<PAGE>
As filed with the Securities and Exchange Commission on
August 28, 1997.
1933 Act Registration No. 33-17619
1940 Act Registration No. 811-5349
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
____________
FORM N-1A
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 ( X )
Post-Effective Amendment No. 38 ( X )
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 ( X )
Amendment No. 40 ( X )
(Check appropriate box or boxes)
__________
GOLDMAN SACHS TRUST
(Exact name of registrant as specified in charter)
4900 Sears Tower
Chicago, Illinois 60606-6303
(Address of principal executive offices)
Registrant's Telephone Number,
including Area Code 312-993-4400
____________
Michael J. Richman, Esq. Copies to:
Goldman, Sachs & Co. Jeffrey A. Dalke, Esq.
85 Broad Street - 12th Floor Drinker Biddle & Reath LLP
New York, New York 10004 1345 Chestnut Street
Philadelphia, PA 19107
(Name and address of agent for service)
It is proposed that this filing will become effective (check appropriate box)
[_] Immediately upon filing pursuant to paragraph (b)
[X] On September 5, 1997 pursuant to paragraph (b)
[_] 60 days after filing pursuant to paragraph (a) (1)
[_] On May 1, 1997 pursuant to paragraph (a) (1)
[_] 75 days after filing pursuant to paragraph (a) (2)
[_] On (Date) pursuant to paragraph (a) (2) of rule 485.
Registrant has registered an indefinite number of its shares under the
Securities Act of 1933 pursuant to Rule 24f-2. On February 28, 1997, Registrant
filed a Rule 24f-2 notice for its fiscal year ended December 31, 1997.
This registration statement is being filed solely to fulfill an undertaking to
file a post-effective amendment using financial statements within four to six
months from the effective date of the post-effective amendment to the
Registration Statement relating to the Financial Square Federal Fund and
Financial Square Treasury Instruments Fund.
<PAGE>
GOLDMAN SACHS TRUST
GOLDMAN SACHS MONEY MARKET FUNDS
FST SHARES
OF FINANCIAL SQUARE FUNDS
---------------
CROSS REFERENCE SHEET
(as required by Rule 485)
<TABLE>
<CAPTION>
PART A CAPTION
- ------ -------
<S> <C>
1. Cover Page Cover Page
2. Synopsis An Introduction to the Funds;
Shareholder and Fund Expenses
3. Condensed Financial Financial Highlights
Information
4. General Description An Introduction to the Funds;
of Registrant Investment Policies Matrix; Description
of Securities and Investment Techniques;
Investment Limitations; Organization and
Shares of the Trust
5. Management of the Fund Management; Organization and
Shares of the Trust
6. Capital Stock and Purchase of Shares; Reports to
Other Securities Shareholders; Distributions; Organization
and Shares of the Trust
7. Purchase of Securities Purchase of Shares; Exchanges;
Being Offered Net Asset Value
8. Redemption or Repurchase Redemption of Shares
9. Pending Legal Proceedings Not Applicable
PART B CAPTION
- ------ -------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information Organization and Capitalization
and History
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
13. Investment Objectives Investment Policies and Practices
and Policies of the Funds; Investment Limitations
14. Management of the Fund Trustees and Officers
15. Control Persons and Organization and Capitalization
Principal Holders
of Securities
16. Investment Advisory The Adviser, Distributor and
and Other Services Transfer Agent; Portfolio Transactions;
Custodian and Subcustodian; Independent
Accountants
17. Brokerage Allocation Portfolio Transactions
and Other Practices
18. Capital Stock and Organization and Capitalization
Other Securities
19. Purchase, Redemption and Net Asset Value; Redemptions
Pricing of Securities
Being Offered
20. Tax Status Tax Information
21. Underwriters The Adviser, Distributor and Transfer Agent
22. Calculation of Calculation of Yield Quotations
Performance Data
23. Financial Statements Financial Statements
</TABLE>
<PAGE>
GOLDMAN SACHS TRUST
GOLDMAN SACHS MONEY MARKET FUNDS
FST ADMINISTRATION SHARES
OF FINANCIAL SQUARE FUNDS
---------------
CROSS REFERENCE SHEET
(as required by Rule 485)
PART A CAPTION
- ------ -------
1. Cover Page Cover Page
2. Synopsis An Introduction to the Funds;
Shareholder and Fund Expenses
3. Condensed Financial Financial Highlights
Information
4. General Description
of Registrant An Introduction to the
Funds; Investment Policies
Matrix; Description of Securities
and Investment Techniques; Investment
Limitations; Organization and Shares
of the Trust
5. Management of the Fund Management; Organization and
Shares of the Trust
6. Capital Stock and Purchase of Shares; Reports to
Other Securities Shareholders; Distributions; Or
ganization and Shares of the
Trust
7. Purchase of Securities Purchase of Shares;
Exchanges; Net Asset Value
8. Redemption or Repurchase Redemption of Shares
9. Pending Legal Proceedings Not Applicable
PART B CAPTION
- ------ -------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
<PAGE>
12. General Information Organization and Capitalization
and History
13. Investment Objectives Investment Policies and Practices
and Policies of the Fund; Investment
Limitations
14. Management of the Fund Trustees and Officers
15. Control Persons and Organization and Capitalization
Principal Holders
16. Investment Advisory The Adviser, Distributor and
and Other Services Transfer Agent; Portfolio Trans
actions; Custodian and
Subcustodian; Independent
Accountants
17. Brokerage Allocation Portfolio Transactions
and Other Practices
18. Capital Stock and Organization and Capitalization
Other Securities
19. Purchase, Redemption and Net Asset Value; Redemptions
Pricing of Securities
Being Offered
20. Tax Status Tax Information
21. Underwriters The Adviser, Distributor and
Transfer Agent
22. Calculation of Calculation of Yield Quotations
Performance Data
23. Financial Statements Financial Statements
<PAGE>
GOLDMAN SACHS TRUST
GOLDMAN SACHS MONEY MARKET FUNDS
FST SERVICE SHARES
OF FINANCIAL SQUARE FUNDS
---------------
CROSS REFERENCE SHEET
(as required by Rule 485)
PART A CAPTION
- ------ -------
1. Cover Page Cover Page
2. Synopsis An Introduction to the Funds;
Shareholder and Fund Expenses
3. Condensed Financial Financial Highlights
Information
4. General Description An Introduction to the Funds; Investment
of Registrant Policies Matrix; Description of
Securities and Investment Techniques;
Investment Limitations; Organization and
Shares of the Trust
5. Management of the Fund Fund Management; Organization and
Shares of the Trust
6. Capital Stock and Purchase of Shares; Reports to
Other Securities Shareholders; Distributions;
Organization and Shares of the Trust
7. Purchase of Securities Purchase of Shares; Exchanges;
Being Offered Net Asset Value
8. Redemption or Repurchase Redemption of Shares
9. Pending Legal Proceedings Not Applicable
PART B CAPTION
- ------ -------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
<PAGE>
12. General Information Organization and Capitalization
and History
13. Investment Objectives Investment Policies and Practices
and Policies of the Funds; Investment Limitations
14. Management of the Fund Trustees and Officers
15. Control Persons and Organization and Capitalization
Principal Holders
of Securities
16. Investment Advisory The Adviser, Distributor and
and Other Services Transfer Agent; Portfolio Transaction;
Subcustodian; Indenpendent Accountants
17. Brokerage Allocation Portfolio Transactions
and Other Practices
18. Capital Stock and Organization and Capitalization
Other Securities
19. Purchase, Redemption and Net Asset Value; Redemptions
Pricing of Securities
Being Offered
20. Tax Status Tax Information
21. Underwriters The Adviser, Distributor
and Transfer Agent
22. Calculation of Calculation of Yield Quotations
Performance Data
23. Financial Statements Financial Statements
<PAGE>
GOLDMAN SACHS TRUST
GOLDMAN SACHS MONEY MARKET FUNDS
FST PREFERRED SHARES
OF FINANCIAL SQUARE FUNDS
---------------
CROSS REFERENCE SHEET
(as required by Rule 485)
PART A CAPTION
- ------ -------
1. Cover Page Cover Page
2. Synopsis An Introduction to the Funds;
Shareholder and Fund Expenses
3. Condensed Financial Financial Highlights
Information
4. General Description An Introduction to the Funds;
of Registrant Investment Policies Matrix;
Description of Securities and
Investment Techniques; Investment
Limitations; Organization and Shares
of the Trust
5. Management of the Fund Management; Organization and
Shares of the Trust
6. Capital Stock and Purchase of Shares; Reports to
Other Securities Shareholders; Distributions; Taxes;
Administration Organization
and Shares of the Trust
7. Purchase of Securities Purchase of Shares; Exchanges;
Being Offered Net Asset Value
8. Redemption or Repurchase Redemption of Shares
9. Pending Legal Proceedings Not Applicable
<PAGE>
PART B CAPTION
- ------ -------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information Organization and Capitalization
and History
13. Investment Objectives Investment Policies and Practices
and Policies of the Funds; Investment
Limitations
14. Management of the Fund Trustees and Officers
15. Control Persons and Organization and Capitalization
Principal Holders
of Securities
16. Investment Advisory The Adviser, Distributor and
and Other Services Transfer Agent; Portfolio Transaction
Custodian and Subcustodian;
Independent Accountants
17. Brokerage Allocation Portfolio Transactions
and Other Practices
18. Capital Stock and Organization and Capitalization
Other Securities
19. Purchase, Redemption and Net Asset Value; Redemptions
Pricing of Securities
Being Offered
20. Tax Status Tax Information
21. Underwriters The Adviser, Distributor
and Transfer Agent
22. Calculation of Calculation of Yield Quotations
Performance Data
23. Financial Statements Financial Statements
<PAGE>
Part C
- ------
Information required to be included in Part C is set forth under the appropriate
Item, so numbered in Part C to this Registration Statement.
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST SHARES
4900 Sears Tower
Chicago, Illinois 60606
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management invest-
ment company (a "mutual fund") which includes the Financial Square Funds (the
"Funds"). This Prospectus relates only to the offering of FST shares of bene-
ficial interest ("FST Shares") of the Funds. Goldman Sachs Asset Management, a
separate operating division of Goldman, Sachs & Co., serves as each Fund's in-
vestment adviser. Goldman, Sachs & Co. serves as each Fund's distributor and
transfer agent.
The following Funds seek to maximize current income to the extent consistent
with the preservation of capital and the maintenance of liquidity by investing
exclusively in high quality money market instruments. The Funds may invest in
diversified portfolios of the following types of instruments:
Financial Square Prime Obligations Fund. Securities of the U.S. Government,
its agencies, authorities and instrumentalities, obligations of U.S. banks,
commercial paper and other short-term obligations of U.S. companies, states,
municipalities and other entities, and repurchase agreements.
Financial Square Money Market Fund. Securities of the U.S. Government, its
agencies, authorities and instrumentalities, U.S. dollar denominated obliga-
tions of U.S. and foreign banks, U.S. dollar denominated commercial paper and
other short-term obligations of U.S. and foreign companies, foreign govern-
ments, states, municipalities and other entities, and repurchase agreements.
Financial Square Premium Money Market Fund. Securities of the U.S. Govern-
ment, its agencies, authorities and instrumentalities, U.S. dollar denominated
obligations of U.S. and foreign banks, U.S. dollar denominated commercial pa-
per and other short-term obligations of U.S. and foreign companies, foreign
governments, states, municipalities and other entities, and repurchase agree-
ments. In order to obtain a rating from a rating organization, the Fund will
observe special investment restrictions.
Financial Square Treasury Obligations Fund. Securities issued or guaranteed
by the U.S. Treasury and repurchase agreements relating to such securities.
Financial Square Treasury Instruments Fund. Securities issued or guaranteed
by the U.S. Treasury, the interest income from which is generally exempt from
state income taxation.
Financial Square Government Fund. Securities of the U.S. Government, its
agencies, authorities, and instrumentalities, and repurchase agreements relat-
ing to such securities.
Financial Square Federal Fund. Securities of the U.S. Government and certain
of its agencies, authorities and instrumentalities, the interest income from
which is generally exempt from state income taxation.
Financial Square Tax-Free Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes and
not an item of tax preference under the federal alternative minimum tax.
Financial Square Municipal Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes (but
not necessarily exempt from federal alternative minimum tax or state and local
taxes).
AN INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOV-
ERNMENT AND THERE CAN BE NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- -------------------------------------------------------------------------------
ADDITIONAL INFORMATION........... Goldman Sachs Funds--Toll Free: 800-621-2550
This Prospectus provides you with information about the Funds that you should
know before investing in FST Shares. It should be read and retained for future
reference. If you would like more detailed information, the Statement of Addi-
tional Information dated September 5, 1997, as amended or supplemented from
time to time, is available upon request without charge by calling the tele-
phone number listed above or by writing Goldman Sachs, Attention: Shareholder
Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606. The
Statement of Additional Information, which is incorporated by reference into
this Prospectus, has been filed with the Securities and Exchange Commission.
Not all Funds are available in certain states. Please call the phone number
listed above to determine availability in your state. The SEC maintains a Web
site (http://www.sec.gov) that contains the Statement of Additional Informa-
tion and other information regarding the Trust.
- -------------------------------------------------------------------------------
FST SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK OR OTHER INSURED DEPOSITORY INSTITUTION, AND ARE NOT IN-
SURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN A FUND INVOLVES INVESTMENT
RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is September 5, 1997.
<PAGE>
SHAREHOLDER AND FUND EXPENSES
FST SHARES
<TABLE>
<CAPTION>
FINANCIAL FINANCIAL FINANCIAL
FINANCIAL FINANCIAL SQUARE FINANCIAL FINANCIAL SQUARE SQUARE
SQUARE SQUARE PREMIUM SQUARE SQUARE FINANCIAL FINANCIAL TAX-FREE MUNICIPAL
PRIME MONEY MONEY TREASURY TREASURY SQUARE SQUARE MONEY MONEY
OBLIGATIONS MARKET MARKET OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MARKET MARKET
FUND FUND FUND FUND FUND FUND FUND FUND FUND
----------- --------- --------- ----------- ----------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER
TRANSACTION EXPENSES
Maximum Sales Charge
Imposed on Purchases. None None None None None None None None None
Sales Charge Imposed
on Reinvested
Distributions....... None None None None None None None None None
Deferred Sales Load
Imposed on
Redemptions......... None None None None None None None None None
Exchange Fee......... None None None None None None None None None
ANNUAL OPERATING
EXPENSES (1)
(as a percentage of
average daily net
assets)
Management Fees
(after
limitations) (2).... 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17%
Other Expenses (after
expense limitations)
(3)................. 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01%
---- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL OPERATING EX-
PENSES (4)........... 0.18% 0.18% 0.18% 0.18% 0.18% 0.18% 0.18% 0.18% 0.18%
==== ==== ==== ==== ==== ==== ==== ==== ====
</TABLE>
EXAMPLE OF EXPENSES
You would pay the following expenses on a hypothetical $1,000 investment, as-
suming a 5% annual return and redemption at the end of each time period:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Financial Square Prime Obligations Fund..... $2 $ 6 $10 $23
Financial Square Money Market Fund.......... $ 2 $ 6 $10 $23
Financial Square Premium Money Market Fund.. $ 2 $ 6 N/A N/A
Financial Square Treasury Obligations Fund.. $ 2 $ 6 $10 $23
Financial Square Treasury Instruments Fund.. $ 2 $ 6 N/A N/A
Financial Square Government Fund............ $ 2 $ 6 $10 $23
Financial Square Federal Fund............... $ 2 $ 6 N/A N/A
Financial Square Tax-Free Money Market Fund. $ 2 $ 6 $10 $23
Financial Square Municipal Money Market
Fund....................................... $ 2 $ 6 N/A N/A
</TABLE>
2
<PAGE>
- --------
(1) Based on estimated amounts for the current fiscal year for the Financial
Square Premium Money Market, Financial Square Treasury Instruments, Finan-
cial Square Federal and Financial Square Municipal Money Market Funds.
(2) The Investment Adviser has voluntarily agreed not to impose 0.035% of its
management fee for each Fund. Without such limitation, management fees for
each Fund would be 0.205%.
(3) The Investment Adviser has voluntarily agreed to reduce or limit certain
other expenses (excluding management fees, taxes, interest and brokerage
and litigation, indemnification and other extraordinary expenses) to the
extent such expenses exceed 0.01% of a Fund's average daily net assets.
(4) Without the limitations described above, "Other Expenses" and "Total Oper-
ating Expenses" of the Financial Square Prime Obligations, Financial
Square Money Market, Financial Square Treasury Obligations, Financial
Square Government and Financial Square Tax-Free Money Market Funds for the
semi annual period ended June 30, 1997, would have been as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Prime Obligations Fund................... .025% .23%
Financial Square Money Market Fund........................ .025% .23%
Financial Square Treasury Obligations Fund................ .035% .24%
Financial Square Government Fund.......................... .015% .22%
Financial Square Tax-Free Money Market Fund............... .015% .22%
</TABLE>
In addition, without the limitations described above, "Other Expenses" and
"Total Operating Expenses" of the Financial Square Premium Money Market, Fi-
nancial Square Treasury Instruments, Financial Square Federal and Financial
Square Municipal Money Market Funds for the current fiscal year are estimated
to be as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Premium Money Market Fund................ .035% .24%
Financial Square Treasury Instruments Fund................ .155% .36%
Financial Square Federal Fund............................. .155% .36%
Financial Square Municipal Money Market Fund.............. .285% .49%
</TABLE>
The information set forth in the foregoing table and hypothetical example
relates only to FST Shares of the Funds. The Funds also offer FST Preferred
Shares, FST Administration Shares and FST Service Shares. The other classes of
the Funds are subject to different fees and expenses (which affect perfor-
mance) and are entitled to different services. Information regarding any other
class of the Funds may be obtained from your sales representative or from
Goldman Sachs by calling the number on the front cover of this Prospectus.
The purpose of the foregoing table is to assist investors in understanding
the various fees and expenses of a Fund that an investor will bear directly or
indirectly. The information on fees and expenses included in the table and the
hypothetical example above are based on each Fund's fees and expenses (actual
or estimated) and should not be considered as representative of past or future
expenses. Actual fees and expenses may be greater or less than those indicat-
ed. Moreover, while the example assumes a 5% annual return, a Fund's actual
performance will vary and may result in an actual return greater or less than
5%. See "Management--Investment Adviser."
3
<PAGE>
FINANCIAL HIGHLIGHTS
The following data with respect to a share (of the class specified) of the
Financial Square Prime Obligations, Financial Square Money Market, Financial
Square Treasury Obligations, Financial Square Government and Financial Square
Tax-Free Money Market Funds outstanding during the periods ended on or prior
to December 31, 1996 have been audited by Arthur Andersen LLP, independent
public accountants, whose report, which appears in the annual report to share-
holders of the Funds for the fiscal year ended December 31, 1996 (the "Annual
Report") is incorporated by reference into and attached to the Statement of
Additional Information. The following data for each of the above referenced
funds along with the Financial Square Treasury Instruments and Financial
Square Federal Funds for the period ended June 30, 1997 is unaudited, and de-
rived from financial statements included in the semi-annual report to share-
holders of the Fund for the period ended June 30, 1997, (the "Semi-Annual Re-
port"). The Annual Report and the Semi-Annual Report should be read in con-
junction with the financial statements and related notes incorporated by ref-
erence and attached to the Statement of Additional Information.
Financial Square Municipal Money Market and Financial Square Premium Money
Market Funds had no operations during the periods shown. Accordingly, there
are no selected per share data and ratios presented for these Funds.
4
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding Throughout Each Period
Prime Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET EXPENSES TO INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT AVERAGE INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0267 $ -- $0.0267 $(0.0267) $1.00 5.53%(b) 0.18%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0262 -- 0.0262 (0.0262) 1.00 5.42(b) 0.28(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0255 -- 0.0255 (0.0255) 1.00 5.27(b) 0.43(b) 5.15(b)
1997-FST Service
shares.......... 1.00 0.0243 -- 0.0243 (0.0243) 1.00 5.00(b) 0.68(b) 4.90(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0529 -- 0.0529 (0.0529) 1.00 5.41 0.18 5.29
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0346 -- 0.0346 (0.0346) 1.00 5.28(b) 0.28(b) 5.19(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0506 -- 0.0506 (0.0506) 1.00 5.14 0.43 5.06
1996-FST Service
shares.......... 1.00 0.0478 -- 0.0478 (0.0478) 1.00 4.88 0.68 4.78
1995-FST shares. 1.00 0.0586 -- 0.0586 (0.0586) 1.00 6.02 0.18 5.86
1995-FST Admin-
istration
shares.......... 1.00 0.0559 -- 0.0559 (0.0559) 1.00 5.75 0.43 5.59
1995-FST Service
shares.......... 1.00 0.0533 -- 0.0533 (0.0533) 1.00 5.49 0.68 5.33
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0401 -- 0.0401 (0.0401) 1.00 4.38(b) 0.18(b) 4.38(b)
1994-FST Admin-
istration
shares(d)....... 1.00 0.0383 -- 0.0383 (0.0383) 1.00 4.12(b) 0.43(b) 4.18(b)
1994-FST Service
shares(d)....... 1.00 0.0364 -- 0.0364 (0.0364) 1.00 3.86(b) 0.68(b) 3.98(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0311 0.0002 0.0313 (0.0313) 1.00 3.18 0.17 3.11
1994-FST Admin-
istration
shares.......... 1.00 0.0286 0.0002 0.0288 (0.0288) 1.00 2.92 0.42 2.86
1994-FST Service
shares.......... 1.00 0.0261 0.0002 0.0263 (0.0263) 1.00 2.66 0.67 2.61
1993-FST shares. 1.00 0.0360 0.0007 0.0367 (0.0367) 1.00 3.75 0.18 3.60
1993-FST Admin-
istration
shares(e)....... 1.00 0.0068 0.0001 0.0069 (0.0069) 1.00 3.02(b) 0.44(b) 2.96(b)
1993-FST Service
shares.......... 1.00 0.0301 0.0007 0.0308 (0.0308) 1.00 3.23 0.68 3.01
1992-FST shares. 1.00 0.0572 0.0002 0.0574 (0.0574) 1.00 5.99 0.18 5.72
1992-FST Service
shares(e)....... 1.00 0.0027 -- 0.0027 (0.0027) 1.00 4.10(b) 0.66(b) 4.10(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0727 -- 0.0727 (0.0727) 1.00 8.27(b) 0.18(b) 8.04(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $3,813,081 0.23%(b) 5.34%(b)
1997-FST Pre-
ferred Shares... 240,047 0.33(b) 5.26(b)
1997-FST Admin-
istration
shares.......... 295,977 0.48(b) 5.10(b)
1997-FST Service
shares.......... 121,165 0.73(b) 4.85(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 3,901,797 0.23 5.24
1996-FST Pre-
ferred
shares(c)....... 127,126 0.33(b) 5.14(b)
1996-FST Admin-
istration
shares.......... 215,898 0.48 5.01
1996-FST Service
shares.......... 115,154 0.73 4.73
1995-FST shares. 3,295,791 0.22 5.82
1995-FST Admin-
istration
shares.......... 147,894 0.47 5.55
1995-FST Service
shares.......... 65,278 0.72 5.29
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 2,774,849 0.24(b) 4.32(b)
1994-FST Admin-
istration
shares(d)....... 66,113 0.49(b) 4.12(b)
1994-FST Service
shares(d)....... 41,372 0.74(b) 3.92(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1,831,413 0.25 3.03
1994-FST Admin-
istration
shares.......... 35,250 0.50 2.78
1994-FST Service
shares.......... 14,001 0.75 2.53
1993-FST shares. 813,126 0.25 3.53
1993-FST Admin-
istration
shares(e)....... 1,124 0.52(b) 2.88(b)
1993-FST Service
shares.......... 336 0.75 2.94
1992-FST shares. 917,073 0.27 5.63
1992-FST Service
shares(e)....... 118 0.74(b) 4.02(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 578,495 0.28(b) 7.94(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
(e) FST Administration share and FST Service share activity commenced during
November of 1992 and January of 1992, respectively.
(f) Commencement of operations.
5
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $1.00 $0.0269 $ -- $0.0269 $(0.0269) $1.00 5.57%(b) 0.18%(b) 5.44%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0264 -- 0.0264 (0.0264) 1.00 5.46(b) 0.28(b) 5.36(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0257 -- 0.0257 (0.0257) 1.00 5.30(b) 0.43(b) 5.18(b)
1997-FST Service
shares.......... 1.00 0.0244 -- 0.0244 (0.0244) 1.00 5.04(b) 0.68(b) 4.93(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 1.00 0.0533 0.0001 0.0534 (0.0534) 1.00 5.45 0.18 5.33
1996-FST
Preferred
shares(c)....... 1.00 0.0348 -- 0.0348 (0.0348) 1.00 5.31(b) 0.28(b) 5.23(b)
1996-FST
Administration
shares.......... 1.00 0.0504 0.0001 0.0505 (0.0505) 1.00 5.19 0.43 5.04
1996-FST Service
shares.......... 1.00 0.0484 -- 0.0484 (0.0484) 1.00 4.93 0.68 4.84
1995-FST shares. 1.00 0.0589 -- 0.0589 (0.0589) 1.00 6.07 0.15 5.89
1995-FST
Administration
shares.......... 1.00 0.0561 -- 0.0561 (0.0561) 1.00 5.80 0.40 5.61
1995-FST Service
shares(d)....... 1.00 0.0231 -- 0.0231 (0.0231) 1.00 5.41(b) 0.65(b) 4.93(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 1.00 0.0305 -- 0.0305 (0.0305) 1.00 4.91(b) 0.11(b) 4.88(b)
1994-FST
Administration
shares(d)....... 1.00 0.0298 -- 0.0298 (0.0298) 1.00 4.65(b) 0.36(b) 4.82(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $3,992,002 0.23%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 43,759 0.33(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 276,152 0.48(b) 5.13(b)
1997-FST Service
shares.......... 290,345 0.73(b) 4.88(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 2,540,366 0.23 5.28
1996-FST
Preferred
shares(c)....... 17,510 0.33(b) 5.18(b)
1996-FST
Administration
shares.......... 165,766 0.48 4.99
1996-FST Service
shares.......... 234,376 0.73 4.79
1995-FST shares. 2,069,197 0.23 5.81
1995-FST
Administration
shares.......... 137,412 0.48 5.53
1995-FST Service
shares(d)....... 4,219 0.73(b) 4.85(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 862,971 0.25(b) 4.74(b)
1994-FST
Administration
shares(d)....... 66,560 0.50(b) 4.68(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST, FST Administration and FST Service share activity commenced May 18,
1994, May 20, 1994 and July 14, 1995, respectively.
6
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL RATIO OF NET INVESTMENT
VALUE AT NET GAIN (LOSS) INCOME FROM DISTRIBUTIONS NET ASSET EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS END OF PERIOD RETURN(A) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0262 $0.0001 $0.0263 $(0.0263) $1.00 5.43%(b) 0.18%(b) 5.28%(b)
1997-FST Pre-
ferred shares .. 1.00 0.0257 0.0001 0.0258 (0.0258) 1.00 5.32(b) 0.28(b) 5.18(b)
1997-FST Admin-
istration shares
................. 1.00 0.0249 0.0001 0.0250 (0.0250) 1.00 5.16(b) 0.43(b) 5.03(b)
1997-FST Service
shares ......... 1.00 0.0237 0.0001 0.0238 (0.0238) 1.00 4.90(b) 0.68(b) 4.78(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0522 0.0003 0.0525 (0.0524) 1.00 5.35 0.18 5.22
1996-FST
Preferred
shares(c)....... 1.00 0.0342 0.0001 0.0343 (0.0343) 1.00 5.24(b) 0.28(b) 5.11(b)
1996-FST
Administration
shares.......... 1.00 0.0497 0.0002 0.0499 (0.0498) 1.00 5.09 0.43 4.97
1996-FST Service
shares.......... 1.00 0.0472 0.0002 0.0474 (0.0474) 1.00 4.83 0.68 4.72
1995-FST shares. 1.00 0.0573 0.0005 0.0578 (0.0578) 1.00 5.96 0.18 5.73
1995-FST
Administration
shares.......... 1.00 0.0547 0.0005 0.0552 (0.0552) 1.00 5.69 0.43 5.47
1995-FST Service
shares.......... 1.00 0.0521 0.0005 0.0526 (0.0526) 1.00 5.43 0.68 5.21
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0379 (0.0001) 0.0378 (0.0378) 1.00 4.23(b) 0.18(b) 4.13(b)
1994-FST
Administration
shares(d)....... 1.00 0.0388 (0.0001) 0.0387 (0.0387) 1.00 3.97(b) 0.43(b) 4.24(b)
1994-FST Service
shares(d)....... 1.00 0.0349 (0.0001) 0.0348 (0.0348) 1.00 3.71(b) 0.68(b) 3.82(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0301 0.0007 0.0308 (0.0307) 1.00 3.11 0.17 3.01
1994-FST
Administration
shares.......... 1.00 0.0276 0.0006 0.0282 (0.0281) 1.00 2.85 0.42 2.76
1994-FST Service
shares.......... 1.00 0.0251 0.0008 0.0259 (0.0256) 1.00 2.60 0.67 2.51
1993-FST shares. 1.00 0.0342 0.0012 0.0354 (0.0355) 1.00 3.69 0.18 3.42
1993-FST
Administration
shares(e) ...... 1.00 0.0009 -- 0.0009 (0.0009) 1.00 2.83(b) 0.43(b) 2.83(b)
1993-FST Service
shares.......... 1.00 0.0296 0.0016 0.0312 (0.0309) 1.00 3.17 0.68 2.96
1992-FST shares. 1.00 0.0549 0.0015 0.0564 (0.0561) 1.00 5.84 0.18 5.49
1992-FST Service
shares(e)....... 1.00 0.0113 0.0006 0.0119 (0.0116) 1.00 4.47(b) 0.68(b) 3.77(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0600 0.0006 0.0606 (0.0605) 1.00 8.06(b) 0.21(b) 7.74(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $2,140,063 0.24%(b) 5.22%(b)
1997-FST Pre-
ferred shares .. 2,826 0.34(b) 5.12(b)
1997-FST Admin-
istration shares
................. 638,287 0.49(b) 4.97(b)
1997-FST Service
shares ......... 232,548 0.74(b) 4.72(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 2,291,051 0.24 5.16
1996-FST
Preferred
shares(c)....... 46,637 0.34(b) 5.05(b)
1996-FST
Administration
shares.......... 536,895 0.49 4.91
1996-FST Service
shares.......... 220,560 0.74 4.66
1995-FST shares. 1,587,715 0.23 5.68
1995-FST
Administration
shares.......... 283,186 0.48 5.42
1995-FST Service
shares.......... 139,117 0.73 5.16
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 958,196 0.25(b) 4.06(b)
1994-FST
Administration
shares(d)....... 82,124 0.50(b) 4.17(b)
1994-FST Service
shares(d)....... 81,162 0.75(b) 3.75(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 812,420 0.24 2.94
1994-FST
Administration
shares.......... 24,485 0.49 2.69
1994-FST Service
shares.......... 35,656 0.74 2.44
1993-FST shares. 776,181 0.26 3.34
1993-FST
Administration
shares(e) ...... 1 0.51(b) 2.75(b)
1993-FST Service
shares.......... 5,155 0.76 2.88
1992-FST shares. 413,171 0.28 5.39
1992-FST Service
shares(e)....... 3,634 0.78(b) 3.67(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 229,988 0.34(b) 7.61(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
(e)FST Administration and FST Service share activity commenced during January
of 1993 and October of 1991, respectively.
(f)Commencement of operations.
7
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Instruments Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $1.00 $ 0.0168 0.0002 $ 0.0170 $(0.0170) $1.00 5.29%(b) 0.18%(b) 5.12%(b)
1997-FST Pre-
ferred shares
(c)............. 1.00 0.0043 0.0002 0.0045 (0.0045) 1.00 5.19(b) 0.28(b) 5.04(b)
1997-FST Admin-
istration shares
(c)............. 1.00 0.0122 0.0002 0.0124 (0.0124) 1.00 5.06(b) 0.43(b) 4.89(b)
1997-FST Service
shares (c)...... 1.00 0.0150 0.0002 0.0152 (0.0152) 1.00 4.73(b) 0.68(b) 4.63(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET
ASSETS AT RATIO OF NET
END RATIO OF INVESTMENT
OF PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $237,444 0.36%(b) 4.94%(b)
1997-FST Pre-
ferred shares
(c)............. 2 0.46(b) 4.86(b)
1997-FST Admin-
istration shares
(c)............. 1,132 0.61(b) 4.71(b)
1997-FST Service
shares (c)...... 35,901 0.86(b) 4.45(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the
investment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Share, FST Preferred Share, FST Administration Share, and FST Service
Share activity commenced March 3, 1997, May 30, 1997, April 1, 1997, and
March 5, 1997, respectively.
8
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Government Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
----------------------------------------
NET ASSET TOTAL
VALUE AT NET NET REALIZED GAIN INCOME FROM DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT END TOTAL
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... $1.00 $ 0.0264 $0.0001 $ 0.0265 $(0.0265) $1.00 5.47%(b)
1997-FST Preferred
shares............... 1.00 0.0259 0.0001 0.0260 (0.0260) 1.00 5.37(b)
1997-FST Administra-
tion shares.......... 1.00 0.0251 0.0001 0.0252 (0.0252) 1.00 5.21(b)
1997-FST Service
shares............... 1.00 0.0239 0.0001 0.0240 (0.0240) 1.00 4.95(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 1.00 0.0525 0.0001 0.0526 (0.0526) 1.00 5.38
1996-FST Preferred
shares(c)............ 1.00 0.0344 0.0001 0.0345 (0.0345) 1.00 5.26(b)
1996-FST Administra-
tion shares.......... 1.00 0.0501 0.0001 0.0502 (0.0502) 1.00 5.12
1996-FST Service
shares............... 1.00 0.0474 0.0001 0.0475 (0.0475) 1.00 4.86
1995-FST shares...... 1.00 0.0581 0.0001 0.0582 (0.0582) 1.00 6.00
1995-FST Administra-
tion shares.......... 1.00 0.0554 0.0001 0.0555 (0.0555) 1.00 5.74
1995-FST Service
shares(d)............ 1.00 0.0320 -- 0.0320 (0.0320) 1.00 5.40(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 1.00 0.0424 -- 0.0424 (0.0424) 1.00 4.36(b)
1994-FST Administra-
tion shares(e)....... 1.00 0.0426 -- 0.0426 (0.0426) 1.00 4.10(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 1.00 0.0256 0.0001 0.0257 (0.0257) 1.00 3.14(b)
1993-FST Administra-
tion shares(d)....... 1.00 0.0120 0.0001 0.0121 (0.0121) 1.00 2.87(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET RATIO OF NET
RATIO OF NET INVESTMENT NET RATIO OF INVESTMENT
EXPENSES TO INCOME TO ASSETS AT END EXPENSES TO INCOME TO
AVERAGE NET AVERAGE NET OF PERIOD AVERAGE NET AVERAGE NET
ASSETS ASSETS (IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... 0.18%(b) 5.33%(b) $1,222,437 0.22%(b) 5.29%(b)
1997-FST Preferred
shares............... 0.28(b) 5.32(b) 48,896 0.32(b) 5.28(b)
1997-FST Administra-
tion shares.......... 0.43(b) 5.07(b) 190,742 0.47(b) 5.03(b)
1997-FST Service
shares............... 0.68(b) 4.83(b) 603,520 0.72(b) 4.79(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 0.18 5.25 858,769 0.24 5.19
1996-FST Preferred
shares(c)............ 0.28(b) 5.14(b) 112 0.34(b) 5.08(b)
1996-FST Administra-
tion shares.......... 0.43 5.01 145,108 0.49 4.95
1996-FST Service
shares............... 0.68 4.74 223,554 0.74 4.68
1995-FST shares...... 0.18 5.81 743,884 0.24 5.75
1995-FST Administra-
tion shares.......... 0.43 5.54 82,386 0.49 5.48
1995-FST Service
shares(d)............ 0.68(b) 5.08(b) 14,508 0.74(b) 5.02(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 0.15(b) 4.64(b) 258,350 0.25(b) 4.54(b)
1994-FST Administra-
tion shares(e)....... 0.40(b) 4.67(b) 54,253 0.50(b) 4.57(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 0.08(b) 3.10(b) 44,697 0.59(b) 2.59(b)
1993-FST Administra-
tion shares(d)....... 0.35(b) 2.85(b) 14,126 0.76(b) 2.44(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced April 6, 1993, September 1, 1993 and May 16, 1995, respectively.
(e) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
9
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Federal Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-----------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN ON INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $1.00 $ 0.0178 -- $ 0.0178 $ (0.0178) $1.00 5.47%(b) 0.18%(b) 5.36%(b)
1997-FST Pre-
ferred
shares(c)....... 1.00 0.0047 -- 0.0047 (0.0047) 1.00 5.46(b) 0.28(b) 5.28(b)
1997-FST Admin-
istration
shares(c)....... 1.00 0.0128 -- 0.0128 (0.0128) 1.00 5.25(b) 0.43(b) 5.17(b)
1997-FST Service
shares(c)....... 1.00 0.0131 -- 0.0131 (0.0131) 1.00 4.99(b) 0.68(b) 4.90(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
NET EXPENSE LIMITATIONS
ASSETS -------------------------
AT END RATIO OF NET
OF RATIO OF INVESTMENT
PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $714,024 0.36%(b) 5.18%(b)
1997-FST Pre-
ferred
shares(c)....... 2 0.46(b) 5.10(b)
1997-FST Admin-
istration
shares(c)....... 137,933 0.61(b) 4.99(b)
1997-FST Service
shares(c)....... 122,323 0.86(b) 4.72(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST share, FST Preferred share, FST Administration share, and FST Service
share activity commenced February 28, 1997, May 30, 1997, April 1, 1997 and
March 25, 1997, respectively.
10
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Tax-Free Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET NET TOTAL
ASSET NET REALIZED INCOME NET ASSET RATIO OF NET
VALUE AT INVEST- GAIN ON FROM DISTRIBUTIONS VALUE AT EXPENSES TO
BEGINNING MENT INVESTMENT INVESTMENT TO END OF TOTAL AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS PERIOD RETURN (A) ASSETS
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $ 0.0170 -- $ 0.0170 $(0.0170) $1.00 3.49%(b) 0.18%(b)
1997-FST Pre-
ferred shares... 1.00 0.0165 -- 0.0165 (0.0165) 1.00 3.39(b) 0.28(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0158 -- 0.0158 (0.0158) 1.00 3.23(b) 0.43(b)
1997-FST Service
shares.......... 1.00 0.0146 -- 0.0146 (0.0146) 1.00 2.97(b) 0.68(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 1.00 0.0335 -- 0.0335 (0.0335) 1.00 3.39 0.18
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0218 -- 0.0218 (0.0218) 1.00 3.30(b) 0.28(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0310 -- 0.0310 (0.0310) 1.00 3.13 0.43
1996-FST Service
shares.......... 1.00 0.0285 -- 0.0285 (0.0285) 1.00 2.88 0.68
1995-FST shares. 1.00 0.0381 -- 0.0381 (0.0381) 1.00 3.89 0.14
1995-FST Admin-
istration
shares.......... 1.00 0.0354 -- 0.0354 (0.0354) 1.00 3.63 0.39
1995-FST Service
shares.......... 1.00 0.0332 -- 0.0332 (0.0332) 1.00 3.38 0.64
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 1.00 0.0156 -- 0.0156 (0.0156) 1.00 3.41(b) 0.07(b)
1994-FST
Administration shares(d). 1.00 0.0136 -- 0.0136 (0.0136) 1.00 3.19(b) 0.32(b)
1994-FST Service
shares(d)....... 1.00 0.0091 -- 0.0091 (0.0091) 1.00 3.11(b) 0.57(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET NET RATIO OF NET
INVESTMENT ASSETS AT RATIO OF INVESTMENT
INCOME TO END OF EXPENSES TO INCOME TO
AVERAGE NET PERIOD AVERAGE NET AVERAGE NET
ASSETS (IN 000'S) ASSETS ASSETS
-------------------------------------------------
<S> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... 3.46%(b) $731,783 0.22%(b) 3.42%(b)
1997-FST Pre-
ferred shares... 3.24(b) 5,468 0.32(b) 3.20(b)
1997-FST Admin-
istration
shares.......... 3.25(b) 96,496 0.47(b) 3.21(b)
1997-FST Service
shares.......... 2.94(b) 27,597 0.72(b) 2.90(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 3.35 440,838 0.23 3.30
1996-FST Pre-
ferred
shares(c)....... 3.26(b) 28,731 0.33(b) 3.21(b)
1996-FST Admin-
istration
shares.......... 3.10 51,661 0.48 3.05
1996-FST Service
shares.......... 2.85 19,855 0.73 2.80
1995-FST shares. 3.81 448,367 0.24 3.71
1995-FST Admin-
istration
shares.......... 3.54 20,939 0.49 3.44
1995-FST Service
shares.......... 3.32 19,860 0.74 3.22
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 3.42(b) 183,570 0.31(b) 3.18(b)
1994-FST
Administration shares(d). 3.25(b) 2,042 0.56(b) 3.01(b)
1994-FST Service
shares(d)....... 3.32(b) 2,267 0.81(b) 3.08(b)
</TABLE>
- --------------
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced July 19, 1994, August 1, 1994 and September 23, 1994, respectively.
11
<PAGE>
AN INTRODUCTION TO THE FUNDS
THE TRUST: The Trust is a no-load, open-end, management investment company
registered under the Investment Company Act of 1940, as amended (the "Invest-
ment Company Act"). Each Fund is a separate pool of assets which pursues its
investment objective through separate investment policies, as described below.
THE ADVISER: Goldman Sachs Asset Management, a separate operating division
of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds' investment ad-
viser (the "Adviser" or "GSAM").
THE DISTRIBUTOR: Goldman Sachs, which serves as the Funds' distributor and
transfer agent, is one of the largest international investment banking and
brokerage firms in the United States.
THE INVESTORS: The Funds are designed for institutional investors seeking a
high rate of return, a stable net asset value and convenient liquidation priv-
ileges. The Funds are particularly suitable for banks, corporations and other
financial institutions that seek investment of short-term funds for their own
accounts or for the accounts of their customers. Shares of the Government Fund
are intended to qualify as eligible investments for Federally chartered credit
unions pursuant to Sections 107(7), 107(8) and 107(15) of the Federal Credit
Union Act, Part 703 of the National Credit Union Administration ("NCUA") Rules
and Regulations and NCUA Letter Number 155. The Fund intends to review changes
in the applicable laws, rules and regulations governing eligible investments
for federally chartered credit unions, and to take such action as may be nec-
essary so that the investments of the Fund qualify as eligible investments un-
der the Federal Credit Union Act and the regulations thereunder. Shares of the
Government Fund, however, may or may not qualify as eligible investments for
particular state chartered credit unions. State chartered credit unions should
consult qualified legal counsel to determine whether the Government Fund is a
permissible investment under the law applicable to it.
THE FUNDS: Each Fund's securities are valued by the amortized cost method as
permitted by a rule ("Rule 2a-7") of the Securities and Exchange Commission
("SEC"). Under such rule, each Fund may invest only in securities that are de-
termined to present minimal credit risk and meet certain other criteria.
TAXABLE FUNDS: Prime Obligations, Money Market, Premium Money Market,
Treasury Obligations and Government Funds.
TAX ADVANTAGED FUNDS: Treasury Instruments and Federal Funds.
TAX-EXEMPT FUNDS: Tax-Free Money Market and Municipal Money Market Funds.
INVESTMENT OBJECTIVES AND POLICIES FOR TAXABLE, TAX-ADVANTAGED AND TAX-
EXEMPT FUNDS: To maximize current income to the extent consistent with the
preservation of capital and the maintenance of liquidity by investing ex-
clusively in high quality money market instruments. In order to obtain a
rating from a rating organization, the Premium Money Market Fund will ob-
serve special investment restrictions. The Treasury Instruments and Federal
Funds pursue their objectives by limiting their investments to certain U.S.
Treasury Obligations and U.S. Government Securities (each as defined here-
in), respectively, the interest from which is generally exempt from state
income taxation. Each investor should consult his or her tax adviser to de-
termine whether distributions from the Treasury Instruments and Federal
Funds (and any other Fund that may hold such obligations) derived from in-
terest on such obligations are exempt from state income taxation in the in-
vestor's own state.
NET ASSET VALUE: Each Fund seeks to maintain a stable net asset value of
$1.00 per share.
MAXIMUM REMAINING MATURITY OF PORTFOLIO INVESTMENTS: Thirteen months at the
time of purchase.
12
<PAGE>
DOLLAR-WEIGHTED AVERAGE PORTFOLIO MATURITY ("WAM"): Not more than ninety
days as required by Rule 2a-7.
FIRST TIER SECURITIES: Each Fund may purchase securities which are rated (or
that have been issued by an issuer that is rated with respect to a class of
short-term debt obligations, or any security within that class, comparable in
priority and quality with such securities) in the highest short-term rating
category by at least two NRSROs (as defined below), or if only one NRSRO has
assigned a rating, by that NRSRO. U.S. Government Securities as defined herein
are considered First Tier Securities.
SECOND TIER SECURITIES: The Tax-Exempt Funds may purchase securities which
are not First Tier Securities but which are rated in the top two short-term
rating categories by at least two NRSROs, or if only one NRSRO has assigned a
rating, by that NRSRO. The Taxable Funds will not invest in a security which
is a Second Tier Security at the time of purchase.
UNRATED SECURITIES: To the extent permitted by Rule 2a-7, unrated securities
may be purchased if they are deemed to be of comparable quality to First Tier
Securities, or to the extent that a Fund may purchase Second Tier Securities,
comparable in quality to Second Tier Securities.
NRSROS: Nationally Recognized Statistical Rating Organizations include Stan-
dard & Poor's Ratings Group ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Fitch Investors Services, Inc., Duff and Phelps, Inc., IBCA Lim-
ited and its affiliate IBCA Inc., and Thomson BankWatch, Inc. For a descrip-
tion of each NRSRO's rating categories, see Appendix A to the Statement of Ad-
ditional Information.
13
<PAGE>
INVESTMENT POLICIES MATRIX
<TABLE>
<CAPTION>
SHORT-TERM
OBLIGATIONS OF ASSET-BACKED & FOREIGN
US US CORPORATIONS RECEIVABLES- GOVERNMENT
TREASURY GOVERNMENT BANK COMMERCIAL AND OTHER REPURCHASE BACKED OBLIGATIONS
FUND OBLIGATIONS SECURITIES OBLIGATIONS PAPER ENTITIES AGREEMENTS SECURITIES+ (US$)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Prime Obligations [_] [_] [_] [_] [_] [_] [_]
U.S. banks U.S. entities
only only
- ------------------------------------------------------------------------------------------------------------------------
Money Market [_] [_] [_] [_] [_] [_] [_] [_]
Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Premium Money [_] [_] [_] [_] [_] [_] [_] [_]
Market Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_] [_]
Obligations
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_]
Instruments
- ------------------------------------------------------------------------------------------------------------------------
Government [_] [_] [_]
- ------------------------------------------------------------------------------------------------------------------------
Federal [_] [_] (Does not
intend to
invest)
- ------------------------------------------------------------------------------------------------------------------------
Tax-Free Money [_]
Market Tax-exempt
only
- ------------------------------------------------------------------------------------------------------------------------
Municipal Money [_]
Market Tax-exempt
only
</TABLE>
Note: See "Description of Securities and Investment Techniques" for a descrip-
tion of, and certain criteria applicable to, each of these categories of
investments.
+To the extent required by Rule 2a-7, asset-backed and receivables-backed
securities will be rated by the requisite number of NRSROs.
14
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
SUMMARY OF
TAXABLE TAX-EXEMPT CREDIT INVESTMENT UNRATED TAXATION FOR
MUNICIPALS MUNICIPALS QUALITY**** COMPANIES SECURITIES DISTRIBUTIONS* MISCELLANEOUS
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
[_] First [_] [ ] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
[_] First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
[_]
First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets generally
in other exempt from
investment state taxation
companies
- ---------------------------------------------------------------------------------------------------
First [_]
Tier Up to 10% of Taxable
total assets federal and
in other state**
investment
companies
- ---------------------------------------------------------------------------------------------------
Under
First [_] Taxable extraordinary
Tier Up to 10% of federal and circumstances,
total assets generally may hold cash,
in other exempt from U.S. Government
investment state taxation Securities
companies subject to state
taxation or cash
equivalents
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May (but does
At least 80% of Second Up to 10% of federal and not currently
net assets in Tier total assets taxable intend to)
Municipal in other state*** invest up to 20%
Instruments investment in AMT
(except in companies securities and
extraordinary may temporarily
circumstances) invest in the
taxable money
market
instruments
described herein
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May invest up to
At least 80% of Second Up to 10% of federal and 100% in AMT
net assets in Tier total assets taxable securities and
Municipal in other state*** may temporarily
Instruments investment invest in the
(except in companies taxable money
extraordinary market
circumstances) instruments
described herein
- ---------------------------------------------------------------------------------------------------
</TABLE>
* See "Taxes" below for an explanation of the tax consequences summarized
in the table above.
** Taxable in many states except for distributions from U.S. Treasury obli-
gation interest income and certain U.S. Government securities interest
income.
*** Taxable except for distributions from interest on obligations of an in-
vestor's state of residence in certain states.
**** To the extent permitted by Rule 2a-7, a Fund holding a security fully
supported by a guarantee may substitute the credit quality of the guaran-
tee in determining the credit quality of the security.
15
<PAGE>
DESCRIPTION OF SECURITIES AND INVESTMENT TECHNIQUES
U.S. TREASURY OBLIGATIONS
"U.S. Treasury Obligations" are securities issued or guaranteed by the U.S.
Treasury, payments of principal and interest on which are backed by the full
faith and credit of the U.S. Government.
U.S. GOVERNMENT SECURITIES
"U.S. Government Securities" are obligations issued or guaranteed by the
U.S. Government, its agencies, authorities or instrumentalities. Unlike U.S.
Treasury Obligations, securities issued or guaranteed by U.S. Government agen-
cies, authorities or instrumentalities are supported either by (a) the full
faith and credit of the U.S. Government (such as securities of the Government
National Mortgage Association), (b) the right of the issuer to borrow from the
Treasury (such as securities of the Student Loan Marketing Association), (c)
the discretionary authority of the U.S. Government to purchase the agency's
obligations (such as securities of the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation), or (d) only the credit of the
issuer. No assurance can be given that the U.S. Government will provide finan-
cial support to U.S. Government agencies, authorities or instrumentalities in
the future. U.S. Government Securities may include zero coupon bonds. Such
bonds may be purchased when yields are attractive.
Securities guaranteed as to principal and interest by the U.S. Government,
its agencies, authorities or instrumentalities are deemed to include (a) secu-
rities for which the payment of principal and interest is backed by an irrevo-
cable letter of credit issued by the U.S. Government, its agencies, authori-
ties or instrumentalities and (b) participations in loans made to foreign gov-
ernments or their agencies that are so guaranteed. The secondary market for
certain of these participations is limited. Such participations may therefore
be regarded as illiquid.
Each Fund may also invest in separately traded principal and interest compo-
nents of securities guaranteed or issued by the U.S. Treasury if such compo-
nents are traded independently under the Separate Trading of Registered Inter-
est and Principal of Securities program ("STRIPS").
The Treasury Instruments and Federal Funds invest in U.S. Treasury Obliga-
tions and the Federal Fund may also invest in certain U.S. Government Securi-
ties the interest from which is generally exempt from state income taxation.
Securities generally eligible for this exemption include those issued by the
U.S. Treasury and those issued by certain agencies, authorities or instrumen-
talities of the U.S. Government, including the Federal Home Loan Banks, Fed-
eral Farm Credit Banks, Tennessee Valley Authority and the Student Loan Mar-
keting Association.
CUSTODIAL RECEIPTS
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may also acquire securities issued or guaranteed as
to principal and interest by the U.S. Government, its agencies, authorities or
instrumentalities in the form of custodial receipts that evidence ownership of
future interest payments, principal payments or both on certain notes or bonds
issued by the U.S. Government, its agencies, authorities or instrumentalities.
For certain securities law purposes, custodial receipts are not considered ob-
ligations of the U.S. Government.
U.S. AND FOREIGN BANK OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "U.S. Bank Obligations" limited to securities issued or guaranteed by
U.S. banks (including certificates of deposit, commer -
16
<PAGE>
cial paper, unsecured bank promissory notes and bankers' acceptances) which
have more than $1 billion in total assets at the time of purchase. Such obli-
gations may also include debt obligations issued by U.S. subsidiaries of such
banks.
The Money Market and Premium Money Market Funds may also invest in "Foreign
Bank Obligations" limited to U.S. dollar-denominated obligations issued or
guaranteed (including fixed time deposits) by foreign banks which have more
than $1 billion in total assets at the time of purchase, U.S. branches of such
foreign banks (Yankee obligations), foreign branches of such foreign banks and
foreign branches of U.S. banks having more than $1 billion in total assets at
the time of purchase. Such bank obligations may be general obligations of the
parent bank or may be limited to the issuing branch by the terms of the spe-
cific obligations or by government regulation.
The Money Market and Premium Money Market Funds will invest more than 25% of
their total assets in bank obligations (whether foreign or domestic), includ-
ing bank commercial paper. However, if adverse economic conditions prevail in
the banking industry (such as substantial losses on loans, increases in non-
performing assets and charge-offs and declines in total deposits) the Funds
may, for defensive purposes, temporarily invest less than 25% of their total
assets in bank obligations. As a result, the Funds may be especially affected
by favorable and adverse developments in or related to the banking industry.
The activities of U.S. banks and most foreign banks are subject to comprehen-
sive regulations which, in the case of U.S. regulations, have undergone sub-
stantial changes in the past decade. The enactment of new legislation or regu-
lations, as well as changes in interpretation and enforcement of current laws,
may affect the manner of operations and profitability of domestic and foreign
banks. Significant developments in the U.S. banking industry have included de-
regulation of interest rates, increased competition from other types of finan-
cial institutions, increased acquisition activity, geographic expansion and,
during the late 1980's, an increased number of bank failures. Banks may be
particularly susceptible to certain economic factors, such as interest rate
changes and adverse developments in the market for real estate. Fiscal and
monetary policy and general economic cycles can affect the availability and
cost of funds, loan demand and asset quality and thereby impact the earnings
and financial conditions of banks. See "Foreign Government Obligations--For-
eign Risks" below.
COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Commercial Paper" (including variable amount master demand notes and
asset-backed commercial paper) which is payable in U.S. dollars and is issued
or guaranteed by U.S. corporations, U.S. commercial banks, foreign corpora-
tions (Money Market and Premium Money Market Funds only), foreign commercial
banks (Money Market and Premium Money Market Funds only) or other entities. In
addition, the Funds may invest in other short-term obligations (including
short-term funding agreements) payable in U.S. dollars and issued or guaran-
teed by U.S. corporations, foreign corporations (Money Market and Premium
Money Market Funds only) or other entities.
ASSET-BACKED AND RECEIVABLES-BACKED SECURITIES
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Asset-Backed and Receivables-Backed Securities" which represent par-
ticipations in, or are secured by and payable from, pools of assets such as
motor vehicle installment sale contracts, installment loan contracts, leases
of various types of real and personal property, receivables from revolving
credit (credit card) agreements and other categories of receivables. Such as-
set pools are securitized through the use of privately-formed trusts or spe-
cial purpose corporations. Payments or distributions of principal and interest
may be guaranteed up to certain amounts and
17
<PAGE>
for a certain time period by a letter of credit or a pool insurance policy is-
sued by a financial institution, or other credit enhancements may be present.
To the extent consistent with its investment objectives and policies, each of
the Prime Obligations, Money Market and Money Market Plus Funds may invest in
new types of mortgage-related securities and in other asset-backed securities
that may be developed in the future.
FOREIGN GOVERNMENT OBLIGATIONS
The Money Market and Premium Money Market Funds may invest in U.S. dollar-
denominated obligations (limited to commercial paper and other notes) issued
or guaranteed by a foreign government or any entity located or organized in a
foreign country that maintains a short-term foreign currency rating in the
highest short-term ratings category by the requisite number of NRSROs. The
Money Market and Premium Money Market Funds may not invest more than 25% of
their total assets in the securities of any one foreign government.
FOREIGN RISKS. Investments in foreign securities and bank obligations may
present a greater degree of risk than investments in securities of domestic
issuers because of less publicly-available financial and other information,
less securities regulation, potential imposition of foreign withholding and
other taxes, war, expropriation or other adverse governmental actions. Foreign
banks and their foreign branches are not regulated by U.S. banking authori-
ties, and generally are not bound by the accounting, auditing and financial
reporting standards applicable to U.S. banks.
MUNICIPAL OBLIGATIONS
MUNICIPAL INSTRUMENTS. Obligations issued by or on behalf of states, terri-
tories and possessions of the United States and their political subdivisions,
agencies, authorities and instrumentalities, and the District of Columbia, the
interest from which is, in the opinion of bond counsel, if any, excluded from
gross income for federal income tax purposes.
TYPES OF MUNICIPAL INSTRUMENTS:
<TABLE>
<CAPTION>
TAX-FREE MONEY MARKET AND
MUNICIPAL MONEY MARKET FUNDS
-------------------------------------------------------------------------
<S> <C>
FIXED RATE NOTES AND SIMILAR In highest short-term or one of the
DEBT INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
VARIABLE AND FLOATING RATE In highest short-term or one of the
DEMAND INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
TAX-EXEMPT COMMERCIAL PAPER In highest rating category
-------------------------------------------------------------------------
MUNICIPAL BONDS In one of the two highest rating
categories
-------------------------------------------------------------------------
UNRATED NOTES, PAPER, BONDS AND Determined to be of comparable quality
OTHER INSTRUMENTS by Adviser pursuant to criteria
approved by the Trustees
</TABLE>
18
<PAGE>
As a matter of fundamental policy, at least 80% of each of the Tax-Free
Money Market and Municipal Money Market Fund's net assets will ordinarily be
invested in Municipal Instruments. Each Tax-Exempt Fund may temporarily invest
in taxable money market instruments when the Adviser believes that the market
conditions dictate a defensive posture. Investments in taxable money market
instruments will be limited to those meeting the quality standards of each
Tax-Exempt Fund. The Prime Obligations, Money Market and Premium Money Market
Funds may invest in short-term obligations issued or guaranteed by state and
municipal governments when yields on such securities are attractive compared
to other taxable investments.
MUNICIPAL NOTES AND BONDS. Municipal notes include tax anticipation notes
("TANs"), revenue anticipation notes ("RANs"), bond anticipation notes
("BANs"), tax and revenue anticipation notes ("TRANs") and construction loan
notes. Municipal bonds include general obligation bonds and revenue bonds.
General obligation bonds are backed by the taxing power of the issuing munici-
pality and are considered the safest type of bonds. Revenue bonds are backed
by the revenues of a project or facility such as the tolls from a toll bridge.
Revenue bonds also include lease rental revenue bonds which are issued by a
state or local authority for capital projects and are secured by annual lease
payments from the state or locality sufficient to cover debt service on the
authority's obligations. Industrial development bonds (generally referred to
under current tax law as "private activity bonds") are a specific type of rev-
enue bond backed by the credit and security of a private user and therefore
have more potential risk. Municipal bonds may be issued in a variety of forms,
including commercial paper, tender option bonds and variable and floating rate
securities.
TENDER OPTION BONDS. A tender option bond is a Municipal Instrument (gener-
ally held pursuant to a custodial arrangement) having a relatively long matu-
rity and bearing interest at a fixed rate substantially higher than prevailing
short-term, tax-exempt rates. The bond is typically issued in conjunction with
the agreement of a third party, such as a bank, broker-dealer or other finan-
cial institution, pursuant to which such institution grants the security
holder the option, at periodic intervals, to tender its securities to the in-
stitution and receive the face value thereof. As consideration for providing
the option, the financial institution receives periodic fees equal to the dif-
ference between the bond's fixed coupon rate and the rate, as determined by a
remarketing or similar agent at or near the commencement of such period, that
would cause the securities, coupled with the tender option, to trade at par on
the date of such determination. Thus, after payment of this fee, the security
holder effectively holds a demand obligation that bears interest at the pre-
vailing short-term, tax-exempt rate. However, an institution will not be obli-
gated to accept tendered bonds in the event of certain defaults or a signifi-
cant downgrading in the credit rating assigned to the issuer of the bond. The
tender option will be taken into account in determining the maturity of the
tender option bonds and a Fund's average portfolio maturity. There is a risk
that a Fund will not be considered the owner of a tender option bond for fed-
eral income tax purposes and thus will not be entitled to treat such interest
as exempt from federal income tax.
REVENUE ANTICIPATION WARRANTS. Revenue Anticipation Warrants ("RAWs") are
issued in anticipation of the issuer's receipt of revenues and present the
risk that such revenues will be insufficient to satisfy the issuer's payment
obligations. The entire amount of principal and interest on RAWs is due at ma-
turity. RAWs, including those with a maturity of more than 397 days, may also
be repackaged as instruments which include a demand feature that permits the
holder to sell the RAWs to a bank or other financial institution at a purchase
price equal to par plus accrued interest on each interest rate reset date.
FLOATING AND VARIABLE RATE OBLIGATIONS. The value of floating and variable
rate obligations generally is more stable than that of fixed rate obligations
in response to changes in interest rate levels. Variable and floating rate ob-
ligations usually have demand features that permit the Funds to sell them at
par value plus accrued interest
19
<PAGE>
upon short notice. The issuers or financial intermediaries providing demand
features may support their ability to purchase the obligations by obtaining
credit with liquidity supports. These may include lines of credit, which are
conditional commitments to lend and letters of credit, which will ordinarily
be irrevocable, both of which may be issued by domestic banks or foreign banks
which have a branch, agency or subsidiary in the United States. When consider-
ing whether an obligation meets a Fund's quality standards, the Fund will, to
the extent permitted by Rule 2a-7, look to the creditworthiness of the party
providing unconditional demand features or other unconditional obligations to
support the credit of the issuer of the security. A Fund may consider the ma-
turity of a variable or floating rate Municipal Instrument to be shorter than
its ultimate stated maturity if the Fund has the right to demand prepayment of
its principal at specified intervals prior to the security's ultimate stated
maturity, subject to the conditions for using amortized cost valuation under
the Investment Company Act. A Fund may purchase such variable or floating rate
obligations from the issuers or may purchase certificates of participation, a
type of floating or variable rate obligation, which are interests in a pool of
debt obligations held by a bank or other financial institution.
INDUSTRIAL DEVELOPMENT BONDS. The Funds (other than the Treasury Obliga-
tions, Treasury Instruments, Government and Federal Funds) may invest in in-
dustrial development bonds (generally referred to under current tax law as
"private activity bonds"), the interest from which would be an item of tax
preference when distributed as "exempt-interest dividends" to shareholders un-
der the federal alternative minimum tax. See "Taxes" and "Distributions." Mu-
nicipal Fund may invest up to 100% of its assets in private activity bonds.
Tax-Free Fund does not currently intend to invest in such bonds. If Tax-Free
Fund's policy not to invest in private activity bonds should change in the fu-
ture, shareholders would be notified and such investments would not exceed 20%
of Tax-Free Fund's net assets.
OTHER POLICIES. Ordinarily the Tax-Exempt Funds expect that 100% of their
portfolio securities will be Municipal Instruments. However, the Funds may
hold cash or invest in short-term taxable securities as set forth above. Such
Funds may invest 25% or more of the value of their respective total assets in
Municipal Instruments which are related in such a way that an economic, busi-
ness or political development or change affecting one Municipal Instrument
would also affect the other Municipal Instruments. For example, the Tax-Exempt
Funds may invest all of their respective assets in (a) Municipal Instruments
the interest on which is paid solely from revenues from similar projects such
as hospitals, electric utility systems, multi-family housing, nursing homes,
commercial facilities (including hotels), steel companies or life care facili-
ties, (b) Municipal Instruments whose issuers are in the same state or (c) in-
dustrial development obligations. Concentration of a Fund's investments in
these Municipal Instruments will subject the Fund, to a greater extent than if
such investment was more limited, to the risks of adverse economic, business
or political developments affecting any such state, industry or other area of
concentration.
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may purchase Municipal Instruments which are backed
by letters of credit, which will ordinarily be irrevocable, issued by domestic
banks or foreign banks (excluding Prime Obligations Fund) which have a branch,
agency or subsidiary in the United States. In addition, these Funds may ac-
quire securities in the form of custodial receipts which evidence ownership of
future interest payments, principal payments or both on obligations of certain
state and local governments and authorities.
In order to enhance the liquidity, stability, or quality of a Municipal In-
strument, each Fund (other than the Treasury Obligations, Treasury Instru-
ments, Government and Federal Funds) may acquire the right to sell the secu-
rity to another party at a guaranteed price and date.
20
<PAGE>
REPURCHASE AGREEMENTS
Each Fund (other than the Treasury Instruments Fund) may only enter into re-
purchase agreements with primary dealers in U.S. Government Securities. A re-
purchase agreement is an agreement under which a Fund purchases securities and
the seller agrees to repurchase the securities within a particular time at a
specified price. Such price will exceed the original purchase price, the dif-
ference being income to the Fund, and will be unrelated to the interest rate
on the purchased security. A Fund's custodian or sub-custodian will maintain
custody of the purchased securities for the duration of the agreement. The
value of the purchased securities, including accrued interest, will at all
times equal or exceed the value of the repurchase agreement. In the event of
bankruptcy of the seller or failure of the seller to repurchase the securities
as agreed, a Fund could suffer losses, including loss of interest on or prin-
cipal of the security and costs associated with delay and enforcement of the
repurchase agreement. In evaluating whether to enter into a repurchase agree-
ment, the Adviser will carefully consider the creditworthiness of the seller
pursuant to procedures reviewed and approved by the Trustees. Distributions of
the income from repurchase agreements entered into by a Fund will be taxable
to its shareholders. In addition, each Fund, together with other registered
investment companies having management agreements with the Adviser or any of
its affiliates, may transfer uninvested cash balances into a single joint ac-
count, the daily aggregate balance of which will be invested in one or more
repurchase agreements.
FORWARD COMMITMENTS AND WHEN-ISSUED SECURITIES
Each Fund may purchase when-issued securities and make contracts to purchase
or sell securities for a fixed price at a future date beyond customary settle-
ment time. A Fund is required to hold and maintain in a segregated account
with the Fund's custodian or sub-custodian until three days prior to settle-
ment date, cash or liquid assets in an amount sufficient to meet the purchase
price. Alternatively, a Fund may enter into offsetting contracts for the for-
ward sale of other securities that it owns. Securities purchased or sold on a
when-issued or forward commitment basis involve a risk of loss if the value of
the security to be purchased declines prior to the settlement date or if the
value of the security to be sold increases prior to the settlement date. Al-
though a Fund would generally purchase securities on a when-issued or forward
commitment basis with the intention of acquiring securities for its portfolio,
the Fund may dispose of a when-issued security or forward commitment prior to
settlement if the Adviser deems it appropriate to do so.
OTHER INVESTMENT COMPANIES
The Adviser will determine, under guidelines established by the Trustees,
whether securities issued by other money market investment companies present
minimal credit risks. The amount of each Fund's investments in securities of
other investment companies will be subject to the limitations on such invest-
ments prescribed by the Investment Company Act. These limits include a prohi-
bition on any Fund acquiring more than 3% of the voting shares of any other
investment company and a prohibition on investing more than 5% of a Fund's to-
tal assets in securities of any one investment company or more than 10% of its
total assets in securities of all investment companies. Each Fund will indi-
rectly bear its proportionate share of any management fees and other expenses
paid by such other investment companies. Such other investment companies will
have investment objectives, policies and restrictions substantially similar to
those of the acquiring Fund and will be subject to substantially the same
risks.
INVESTMENT LIMITATIONS
TAXABLE AND TAX-EXEMPT FUNDS. Each Fund will comply with the conditions for
using amortized cost valuation set forth in Rule 2a-7 under the Investment
Company Act including, but not limited to, those condi-
21
<PAGE>
tions relating to maturity, diversification and credit quality. These operat-
ing policies may be more restrictive than the fundamental policies set forth
in the Statement of Additional Information.
INVESTMENT RESTRICTIONS. Each Fund is subject to certain investment restric-
tions that are described in detail under "Investment Restrictions" in the
Statement of Additional Information. Fundamental investment restrictions of a
Fund cannot be changed without approval of a majority of the outstanding
shares of that Fund. Treasury Obligations Fund's policy of limiting its in-
vestments to U.S. Treasury Obligations and related repurchase agreements is
also fundamental. All investment objectives and policies not specifically des-
ignated as fundamental are non-fundamental and may be changed without share-
holder approval.
RESTRICTED AND OTHER ILLIQUID SECURITIES. Each Fund may purchase securities
that are not registered ("restricted securities") under the Securities Act of
1933 ("1933 Act"), but can be offered and sold to "qualified institutional
buyers" under Rule 144A under the 1933 Act. However, a Fund will not invest
more than 10% of its net assets in illiquid investments, which include fixed
time deposits maturing in more than seven days and restricted securities.
Restricted securities (including commercial paper issued pursuant to Section
4(2) of the 1933 Act) which the Board of Trustees has determined are liquid,
based upon a continuing review of the trading markets for the specific re-
stricted security, will not be deemed to be illiquid investments for purposes
of this restriction. The Board of Trustees may adopt guidelines and delegate
to the Adviser the daily function of determining and monitoring the liquidity
of restricted securities. The Board, however, will retain sufficient oversight
and be ultimately responsible for the determinations. Since it is not possible
to predict with assurance that the market for restricted securities eligible
for resale under Rule 144A will continue to be liquid, the Adviser will care-
fully monitor each Fund's investments in these securities, focusing on such
important factors, among others, as valuation, liquidity and availability of
information. This investment practice could have the effect of increasing the
level of illiquidity in a Fund to the extent that qualified institutional buy-
ers become for a time uninterested in purchasing these restricted securities.
In addition, each Fund may not invest in repurchase agreements maturing in
more than seven days and securities which are not readily marketable if, as a
result thereof, more than 10% of the net assets of that Fund (taken at market
value) would be invested in such investments. Certain repurchase agreements
which mature in more than seven days can be liquidated before the nominal
fixed term on seven days or less notice. Such repurchase agreements will be
regarded as liquid instruments.
MANAGEMENT
THE ADVISER
GSAM, One New York Plaza, New York, New York 10004, a separate operating di-
vision of Goldman, Sachs & Co., acts as investment adviser to the Funds.
Goldman Sachs registered as an investment adviser in 1981. As of July , 1997,
Goldman Sachs, together with its affiliates, acted as investment adviser, ad-
ministrator or distributor for approximately $ billion in assets.
As of November 29, 1996, Goldman Sachs and its consolidated subsidiaries had
assets of approximately $152 billion and partners' capital of $5.3 billion and
ranked as one of the largest international investment banking and brokerage
firms in the United States. Founded in 1869, Goldman Sachs is a major invest-
ment banking and brokerage firm providing a broad range of financing and in-
vestment services both in the United States and abroad.
22
<PAGE>
Pursuant to an SEC order, each Taxable and Tax-Advantaged Fund may enter
into principal transactions in certain taxable money market instruments, in-
cluding repurchase agreements, with Goldman Sachs.
Under the Management Agreement, GSAM continually manages each Fund, includ-
ing the purchase, retention and disposition of its securities and other as-
sets. In addition, GSAM administers each Fund's business affairs and performs
various shareholder servicing functions to the extent not provided by other
organizations. The management of each Fund is subject to the supervision of
the Trustees and each Fund's investment policies. For these services, the
Trust, on behalf of each Fund, pays GSAM a monthly fee at an annual rate of
each Fund's average daily net assets as follows:
<TABLE>
<CAPTION>
FISCAL YEAR
ENDED
CONTRACTUAL DECEMBER 31,
RATE 1996
----------- ------------
<S> <C> <C>
Financial Square Prime Obligations Fund................ .205% .17%
Financial Square Money Market Fund..................... .205% .17%
Financial Square Premium Money Market Fund............. .205% N/A*
Financial Square Treasury Obligations Fund............. .205% .17%
Financial Square Treasury Instruments Fund............. .205% N/A*
Financial Square Government Fund....................... .205% .17%
Financial Square Federal Fund.......................... .205% N/A*
Financial Square Tax Free Money Market Fund............ .205% .17%
Financial Square Municipal Money Market Fund........... .205% N/A*
</TABLE>
* As of December 31, 1996, the Premium Money Market Fund, Treasury Instruments
Fund, Federal Fund and Municipal Money Market Fund had not commenced opera-
tions.
A Management Agreement combining both advisory and administrative services
was adopted effective April 30, 1997. The contractual rate set forth in the
table is the rate payable under the Management Agreement and is identical to
the aggregate advisory and administration fees payable by each Fund under the
previously separate investment advisory and administration agreements. For the
fiscal year ended December 31, 1996, the annual rate expressed is the combined
advisory and administration fees paid (after voluntary fee limitations). The
difference, if any, between the stated fees and the actual fees paid by the
Funds reflects the fact that the Investment Adviser did not charge the full
amount of the fees to which it would have been entitled.
GSAM has agreed not to impose a portion of its management fee and/or to re-
duce or otherwise limit the total operating expenses of each Fund (excluding
fees payable to Service Organizations, as defined herein, taxes, interest,
brokerage and litigation, indemnification and other extraordinary expenses).
GSAM has no current intention to but may in the future discontinue or modify
any of such reductions or limitations at its discretion.
THE DISTRIBUTOR AND TRANSFER AGENT
Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606, serves as the Dis-
tributor of shares of each Fund pursuant to a Distribution Agreement with the
Trust. The Distributor will assist in the sale of shares of each Fund upon the
terms described herein. Goldman Sachs also serves as the Transfer Agent of
each Fund.
From time to time, Goldman Sachs or any of its affiliates may purchase and
hold shares of the Funds in order to increase the assets of the Funds. In-
creasing the Fund's assets may enhance investment flexibility and diversifica-
tion. Goldman Sachs reserves the right to redeem at any time some or all of
the Fund shares acquired for its own account. Goldman Sachs will consider the
effect of redemptions on the Funds and other shareholders in deciding whether
to redeem its shares.
23
<PAGE>
TAXES
Each Fund is treated as a separate entity for federal tax purposes. The
Treasury Instruments and Federal Funds intend to elect and each other Fund has
elected to be treated as a regulated investment company and each Fund intends
to continue to qualify for such treatment under Subchapter M of the Internal
Revenue Code of 1986 (the "Code") for each taxable year. To qualify as such,
each Fund must satisfy certain requirements relating to the sources of its in-
come, diversification of its assets and distribution of its income to share-
holders. As a regulated investment company, each Fund will not be subject to
federal income or excise tax on any net investment income and net realized
capital gains that are distributed to its shareholders in accordance with cer-
tain timing requirements of the Code.
Dividends paid by a Fund from net investment income, the excess of net
short-term capital gain over net long-term capital loss and taxable original
issue discount or market discount income will be taxable to shareholders as
ordinary income, except for any "exempt-interest dividends" paid by the Tax-
Exempt Funds, as described below. Dividends paid by a Fund from the excess of
net long-term capital gain over net short-term capital loss will be taxable as
long-term capital gain regardless of how long the shareholders have held their
shares. These tax consequences will apply to distributions of any Fund
regardless of whether distributions are received in cash or reinvested in
shares. Certain distributions paid by the Funds in January of a given year
will be taxable to shareholders as if received on December 31 of the year in
which they are declared. Shareholders will be informed annually about the
amount and character of distributions received from the Funds for federal
income tax purposes, including any distributions that may constitute a return
of capital or any distributions of Municipal Fund that may constitute a tax
preference item under the federal alternative minimum tax.
The Tax-Exempt Funds intend to satisfy certain requirements of the Code for
the payment of "exempt-interest dividends" not included in shareholders' fed-
eral gross income. Dividends paid by these Funds from interest on tax-exempt
obligations and properly designated by the Funds as exempt-interest dividends,
including dividends attributable to exempt-interest dividends received by a
Fund from other regulated investment companies, will generally be exempt from
federal income tax, although a portion of such dividends may be subject to the
federal alternative minimum tax. Exempt-interest dividends will be considered
in computing the corporate federal alternative minimum tax, and the extent, if
any, to which social security or railroad retirement benefits are taxable.
Persons who are "substantial users" of facilities financed by certain indus-
trial development or private activity bonds should consult their own tax ad-
visers before purchasing shares of these Funds. Interest incurred to purchase
or carry shares of these Funds will not be deductible for federal income tax
purposes to the extent related to exempt-interest dividends paid by the Funds.
Individuals and certain other classes of shareholders may be subject to 31%
backup withholding of federal income tax on taxable distributions if they fail
to furnish their correct taxpayer identification number and certain certifica-
tions required by the Internal Revenue Service or if they are otherwise sub-
ject to backup withholding. Individuals, corporations and other shareholders
that are not U.S. persons under the Code are subject to different tax rules
and may be subject to nonresident alien withholding at the rate of 30% (or a
lower rate provided by an applicable tax treaty) on amounts treated as ordi-
nary dividends from the Funds.
If a Fund invests in foreign securities, it may be subject to foreign with-
holding or other foreign taxes on income earned on such securities and is ex-
pected to be unable to pass such taxes through to shareholders, who therefore
are not expected to include such taxes in income or be entitled to claim for-
eign tax credits or deductions with respect to such taxes.
In addition to federal taxes, a shareholder may be subject to state, local
or foreign taxes on payments received from a Fund. A state income (and possi-
bly local income and/or intangible property) tax exemption is
24
<PAGE>
generally available to the extent a Fund's distributions are derived from in-
terest on (or, in the case of intangible property taxes, the value of its as-
sets is attributable to) certain U.S. Government obligations and/or tax-exempt
municipal obligations issued by or on behalf of the particular state or a po-
litical subdivision thereof, provided in some states that certain thresholds
for holdings of such obligations and/or reporting requirements are satisfied.
Shareholders should consult their own tax advisers concerning these matters.
NET ASSET VALUE
The net asset value of each Fund (other than the Government, Treasury Obli-
gations and Money Market Plus Funds) is determined as of the close of regular
trading on the New York Stock Exchange (normally 4:00 p.m. New York time) on
each Business Day. The net asset value of Government, Treasury Obligations and
Money Market Plus Funds is determined as of 5:00 p.m. New York time on each
Business Day. Net asset value per share for each class of shares of each Fund
is calculated by determining the amount of net assets attributable to each
class of shares and dividing by the number of shares for such class.
On any Business Day, as defined herein, when the Public Securities Associa-
tion ("PSA") recommends that the securities markets close early, the Treasury
Instruments and Federal Funds will cease, and each other Fund reserves the
right to cease, accepting purchase and redemption orders for same Business Day
credit at the time PSA recommends that the securities markets close. On days
any Fund closes early, purchase and redemption orders received after the PSA
recommended closing time will be credited to the next Business Day. In addi-
tion, each Fund reserves the right to advance the time by which purchase and
redemption orders must be received for same Business Day credit as permitted
by the SEC.
Each Fund seeks to maintain a net asset value of $1.00 per share. In this
connection, each Fund values its portfolio securities on the basis of amor-
tized cost. The amortized cost method values a security at its cost on the
date of purchase and thereafter assumes a constant amortization to maturity of
any discount or premium, regardless of the impact of fluctuating interest
rates on the market value of the instrument. For a more complete description
of the amortized cost valuation method and its effect on existing and prospec-
tive shareholders, see the Statement of Additional Information. There can be
no assurance that a Fund will be able at all times to maintain a net asset
value per share of $1.00.
YIELD INFORMATION
From time to time, each Fund may advertise its yield, effective yield and
average annual total return. Average annual total return is determined by com-
puting the average annual percentage change in value of $1,000 invested at the
maximum public offering price for a specified period of at least one year, as-
suming reinvestment of all dividends and distributions at net asset value. The
total return calculation assumes a complete redemption of the investment at
the end of the relevant period. Each Fund may furnish total return calcula-
tions based on a cumulative, average, year-by-year or other basis for various
specified periods by means of quotations, charts, graphs or schedules. The
yield of a Fund refers to the income generated by an investment in that Fund
over a seven-day period (which period will be stated in the advertisement).
This income is then annualized; that is, the amount of income generated by the
investment during that week is assumed to be generated each week over a 52-
week period and is shown as a percentage of the investment. The effective
yield is calculated similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The effective yield will
be slightly higher than the yield because of the compounding effect of this
assumed reinvestment.
The Tax-Exempt Funds and the Federal and Treasury Instruments Funds may each
also quote tax-equivalent yield. Each Fund's tax-equivalent yield is calcu-
lated by determining the rate of return that would have to be
25
<PAGE>
achieved on a fully taxable investment to produce the after-tax equivalent of
the Fund's yield, assuming certain tax brackets for a shareholder.
Investors should note that the investment results of a Fund are based on
historical performance and will fluctuate over time. Any presentation of a
Fund's total return, yield, effective yield or tax-equivalent yield for any
prior period should not be considered a representation of what an investment
may earn or what a Fund's total return, yield, effective yield or tax-equiva-
lent yield may be in any future period. In addition to the above, each Fund
may from time to time advertise its performance relative to certain averages,
performance rankings, indices, other information prepared by recognized mutual
fund statistical services and investments for which reliable performance data
is available.
Total return, yield, effective yield and tax-equivalent yield will be calcu-
lated separately for each class of shares in existence. Because each such
class of shares is subject to different expenses, the total return and net
yield of such classes of a Fund for the same period may differ. See "Organiza-
tion and Shares of the Trust" below.
ORGANIZATION AND SHARES OF THE TRUST
Each Fund is a series of the Goldman Sachs Trust, which was formed under the
laws of the State of Delaware on January 28, 1997. The Funds were formerly se-
ries of Goldman Sachs Money Market Trust, a Massachusetts business trust, and
were reorganized into the Trust as of April 30, 1997. The Trustees have au-
thority under the Trust's Declaration of Trust to create and classify shares
of beneficial interest in separate series, without further action by share-
holders. Additional series may be added in the future. The Trustees also have
authority to classify or reclassify any series or portfolio of shares into one
or more classes. (Institutions that provide services to holders of FST Pre-
ferred Shares, FST Administration Shares or FST Service Shares are referred to
in this Prospectus as "Service Organizations").
When issued, shares are fully paid and nonassessable. In the event of liqui-
dation, shareholders are entitled to share pro rata in the net assets of the
applicable Fund available for distribution to such shareholders. All shares
are freely transferable and have no preemptive, subscription or conversion
rights. Shareholders are entitled to one vote per share, provided that, at the
option of the Trustees, shareholders will be entitled to a number of votes
based upon the net asset values represented by their shares.
Shares of a Fund will be voted seperately by Fund with respect to matters
pertaining to that Fund except for the election of Trustees and ratification
of independent accountants. For example, shareholders of each Fund are re-
quired to approve the adoption of any management agreement relating to that
Fund and any changes in fundamental investment restrictions or policies of
such Fund. Approval by the shareholders of one Fund is effective only as to
that Fund.
As of August 8, 1997, Harris Trust & Savings Bank, 200 W. Monroe St. Fl 12,
Chicago, IL 60606, owned of record 35.04% of the outstanding shares of Trea-
sury Instruments Fund and National City Bank, P.O. Box 5756, Cleveland, OH
44101-0756, owned of record 32.86% of the outstanding shares of Premium Money
Market Fund.
The Trust does not intend to hold annual meetings of shareholders. However,
pursuant to the Trust's By-Laws, the recordholders of at least 10% of the
shares outstanding and entitled to vote at a special meeting may require the
Trust to hold such special meeting of shareholders for any purpose, and
recordholders may, under certain circumstances, as permitted by the Investment
Company Act, communicate with other shareholders in connection with requiring
a special meeting of shareholders. The Trustees will call a special meeting of
shareholders for the purpose of electing Trustees if, at any time, less than a
majority of Trustees holding office at the time were elected by shareholders.
26
<PAGE>
PURCHASE OF SHARES
FST Shares of a Fund may be purchased on any Business Day at the net asset
value next determined after receipt of a purchase order in the manner set
forth below, and provided that The Northern Trust Company ("Northern"), Chica-
go, Illinois, the sub-custodian for State Street Bank and Trust Company
("State Street"), receives the purchase amount in federal funds on the same
Business Day. Purchase orders may be made by telephoning Goldman Sachs at 800-
621-2550 or by a written request addressed to Goldman Sachs, Attention: Share-
holder Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois
60606. It is strongly recommended that payment be effected by wiring federal
funds to Northern.
Purchases of FST Shares may also be made by delivering a Federal Reserve
draft or check (except that a third party check will not be accepted) payable
only to the appropriate Fund and drawn on a U.S. bank to Goldman Sachs, Atten-
tion: Shareholder Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago,
Illinois 60606. It is expected that Federal Reserve drafts will ordinarily be
converted to federal funds on the day of receipt and that checks will be con-
verted to federal funds within two Business Days after receipt. FST Shares
purchased by check may not be redeemed until the check has cleared, as de-
scribed under "Redemption of Shares."
Purchases of shares of any Fund may also be made through an Automated Clear-
ing House ("ACH") transfer to Goldman Sachs Trust c/o Northern, as
subcustodian for State Street. Purchase orders are effected at the net asset
value next determined after receipt of both the purchase order and the pur-
chase amount in federal funds. It is expected that ACH transfers will ordinar-
ily be converted to federal funds on the Business Day following receipt of the
ACH transfer.
FST Shares of each Fund are deemed to have been purchased when an order be-
comes effective and are entitled to dividends on FST Shares purchased as fol-
lows:
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
IF ORDER IS RECEIVED BY GOLDMAN SACHS DIVIDENDS BEGIN
------------------------------------- ---------------
<S> <C> <C>
(1) Taxable and Tax-Advantaged Funds (except
Government,
Treasury Obligations and Premium Money Market
Funds)
By:3:00 p.m.--N.Y. time Same Business Day
- ----------------------------------------------------------------
After:3:00 p.m.--N.Y. time Next Business Day
- ----------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By:5:00 p.m.--N.Y. time Same Business Day
- ----------------------------------------------------------------
After:5:00 p.m.--N.Y. time Next Business Day
- ----------------------------------------------------------------
(3) Municipal Fund
By:1:00 p.m.- N.Y. time Same Business Day
- ----------------------------------------------------------------
After:1:00 p.m.- N.Y. time Next Business Day
- ----------------------------------------------------------------
(4) Tax-Free Money Market Fund
By:2:00 p.m.- N.Y. time Same Business Day
- ----------------------------------------------------------------
After:2:00 p.m.- N.Y. time Next Business Day
- ----------------------------------------------------------------
</TABLE>
27
<PAGE>
A Business Day means any day on which the New York Stock Exchange is open,
except for days on which Chicago, Boston or New York banks are closed for lo-
cal holidays.
FST Shares of the Funds are purchased at the net asset value per share with-
out the imposition of a sales charge. However, banks, trust companies or other
institutions through which investors acquire FST Shares may impose charges in
connection with transactions in such Shares.
Goldman Sachs, as each Fund's transfer agent, will maintain a complete rec-
ord of transactions and FST Shares held in each shareholder's account. The
Trust and Goldman Sachs each reserves the right to reject any purchase order
for any reason.
INITIAL PURCHASES
The minimum initial investment requirement is $10 million, which may be al-
located among the Funds. The Trust and Goldman Sachs each reserves the right
to waive the minimum investment requirement. Before or immediately after plac-
ing an initial purchase order, investors should complete and send to Goldman
Sachs the Account Information Form included at the end of this Prospectus.
SUBSEQUENT INVESTMENTS
There is no minimum amount required for subsequent investments. Orders for
the purchase of additional FST Shares should be accompanied by information
identifying the account and the Fund in which FST Shares are to be purchased.
REPORTS TO SHAREHOLDERS
FST Shareholders of each Fund will receive an annual report containing au-
dited financial statements and a semiannual report. Each FST Shareholder will
also be furnished with an individual monthly statement. Upon request, a
printed confirmation for each transaction will be provided by Goldman Sachs.
Any dividends and distributions paid by a Fund are also reflected in regular
statements issued by Goldman Sachs. A year-to-date statement for any account
will be provided upon request made to Goldman Sachs. FST Shareholders with in-
quiries regarding a Fund may call Goldman Sachs at 800-621-2550 (8:00 a.m. to
6:30 p.m. New York time) or write Goldman Sachs at the address shown under
"The Distributor and Transfer Agent."
SUB-ACCOUNTING SERVICES
The Trust has designed special procedures to assist banks and other institu-
tional investors desiring to establish multiple accounts (master accounts and
their sub-accounts). Sub-accounts may be established with registration by name
and/or number. Institutions will not normally be charged for this service un-
less otherwise agreed upon. Upon request, master accounts will be provided
with a monthly summary report which sets forth in order by account number (or
name) the share balance at month-end and the monthly income together with the
total share balance and monthly income for the master account.
To assist banks and other institutional investors performing their own sub-
accounting, each Fund's daily income per share, calculated to nine decimal
places, and its annualized yield are normally available by 4:00 p.m. New York
time.
28
<PAGE>
DISTRIBUTIONS
All or substantially all of each Fund's net investment income will be de-
clared daily (as of 4:00 p.m. New York time for each Fund other than the Gov-
ernment, Treasury Obligations and Premium Money Market Funds and as of 5:00
p.m. New York time for the Government, Treasury Obligations and Premium Money
Market Funds) as a dividend and distributed to FST Shareholders monthly. Dis-
tributions will be made in additional FST Shares of the same Fund or, at the
election of FST Shareholders, in cash. The election to reinvest dividends and
distributions or receive them in cash may be changed at any time upon written
notice to Goldman Sachs. If no election is made, all dividends and capital
gain distributions will be reinvested. Dividends will be reinvested as of the
last calendar day of each month. Cash distributions will be paid on or about
the first business day of each month. Net short-term capital gains, if any,
will be distributed in accordance with the requirements of the Code and may be
reflected in the Fund's daily distributions. Each Fund may distribute at least
annually its long-term capital gains, if any, after reduction by available
capital losses. In order to avoid excessive fluctuations in the amount of
monthly capital gains distributions, a portion of any net capital gains real-
ized on the disposition of securities during the months of November and Decem-
ber may be distributed during the subsequent calendar year. Although realized
gains and losses on the assets of a Fund are reflected in the net asset value
of the Fund, they are not expected to be of an amount which would affect the
Fund's net asset value of $1.00 per share.
The income declared as a dividend for the Treasury Obligations, Government
and Premium Money Market Funds is based on estimates of net investment income
for each Fund. Actual income may differ from estimates, and differences, if
any, will be included in the calculation of subsequent dividends.
A Fund's net investment income consists of the excess of (i) accrued
interest or discount (including both original issue and market discount on
taxable securities) on portfolio securities, and (ii) any income of the Fund
from sources other than capital gains over (iii) the amortization of market
premium on all portfolio securities and (iv) the estimated expenses of the
Fund, including a proportionate share of the general expenses of the Trust.
EXCHANGES
FST Shares of each Fund may be exchanged for shares of the corresponding
class of any Fund or Portfolio of Goldman Sachs Trust at the net asset value
next determined either by writing to Goldman Sachs, Attention: Shareholder
Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606 or,
if previously elected in the Account Information Form included at the end of
this Prospectus, by calling Goldman Sachs at 800-621-2550. All telephone
exchanges must be registered in the same name(s) and with the same address as
are registered in the Fund from which the exchange is being made. It may be
difficult to implement the telephone exchange privilege in times of drastic
economic or market changes. In an effort to prevent unauthorized or fraudulent
exchange requests by telephone, Goldman Sachs employs reasonable procedures as
set forth under "Redemption of Shares" to confirm that such instructions are
genuine. Exchanges are available only in states where the exchange may legally
be made. The exchange privilege may be modified or withdrawn at any time on 60
days' written notice.
REDEMPTION OF SHARES
HOW TO REDEEM
FST Shareholders may redeem FST Shares of a Fund without charge upon request
on any Business Day at the net asset value next determined after receipt of
the redemption request. Redemption requests may be made by
29
<PAGE>
telephoning Goldman Sachs at 800-621-2550 or by a written request addressed to
Goldman Sachs, Attention: Shareholder Services, Goldman Sachs Trust, 4900
Sears Tower, Chicago, Illinois 60606. The letter of instruction must specify
the number of FST Shares of the particular Fund to be redeemed, the account
number, payment instructions and the exact registration on the account. Signa-
tures must be guaranteed in accordance with the procedures set forth below, if
the proceeds are to be paid to other than pre-established instructions on file
with the Fund. A FST Shareholder may request redemptions by telephone only if
the optional telephone redemption privilege has been elected on the Account
Information Form included at the end of this Prospectus. It may be difficult
to implement redemptions by telephone in times of drastic economic or market
changes.
In an effort to prevent unauthorized or fraudulent redemption requests by
telephone, Goldman Sachs employs reasonable procedures specified by the Trust
to confirm that such instructions are genuine. Among other things, any redemp-
tion request that requires money to go to an account or address other than
that designated on the Account Information Form must be in writing and signed
by an authorized person designated on the Account Information Form. Any such
written request is also confirmed by telephone with both the requesting party
and the designated bank account to verify instructions. Other procedures may
be implemented from time to time. If reasonable procedures are not implement-
ed, the Trust may be liable for any loss due to unauthorized or fraudulent
transactions. In all other cases, neither the Trust nor Goldman Sachs will be
responsible for the authenticity of redemption instructions received by tele-
phone. A redemption may also be made with respect to certain Funds by means of
the check redemption privilege described in the Statement of Additional Infor-
mation. Goldman Sachs reserves the right to redeem accounts with balances be-
low $500.
Additional documentation may be required by Goldman Sachs in order to estab-
lish that a redemption request has been properly authorized. A redemption re-
quest will not be considered to have been received in proper form until such
additional documentation has been submitted to Goldman Sachs. The payment of
redemption proceeds for FST Shares recently purchased by check will be delayed
for up to 15 days until the check has cleared.
PAYMENT OF REDEMPTION PROCEEDS AND DIVIDENDS
In accordance with the following, redemption proceeds will be wired to the
bank account designated on the FST Shareholder's Account Information Form, un-
less payment by check has been requested.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
REDEMPTION REQUEST RECEIVED REDEMPTION PROCEEDS
BY GOLDMAN SACHS ORDINARILY DIVIDENDS
- --------------------------- ------------------- ---------
<S> <C> <C>
(1) Taxable and Tax-Advantaged Funds (except Government,
Treasury Obligations and Premium Money Market Funds)
By:3:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day request is
received
- ----------------------------------------------------------------------------------------------------
After:3:00 p.m.--N.Y.
time Wired Next Business Day Earned on Day request is
received
- ----------------------------------------------------------------------------------------------------
(2) Government and Treasury Obligations and
Premium Money Market Funds
By:5:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day request is
received
- ----------------------------------------------------------------------------------------------------
After:5:00 p.m.--N.Y.
time Wired Next Business Day Earned on Day request is
received
- ----------------------------------------------------------------------------------------------------
</TABLE>
30
<PAGE>
<TABLE>
- ---------------------------------------------------------------------------------------
<CAPTION>
REDEMPTION REQUEST RECEIVED REDEMPTION PROCEEDS
BY GOLDMAN SACHS ORDINARILY DIVIDENDS
- --------------------------- ------------------- ---------
<S> <C> <C>
(3) Municipal Fund
By:12:00 noon--N.Y. time Wired Same Business Day Not earned on Day request is
received
- ---------------------------------------------------------------------------------------
After:12:00 noon--N.Y.
time Wired Next Business Day Earned on Day request is
received
- ---------------------------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By:1:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day request is
received
- ---------------------------------------------------------------------------------------
After:1:00 p.m.--N.Y.
time Wired Next Business Day Earned on Day request is
received
- ---------------------------------------------------------------------------------------
</TABLE>
The Funds will arrange for the proceeds of redemptions effected by any means
to be wired as federal funds to the bank account designated in the Account In-
formation Form. Redemption proceeds will normally be wired as set forth above,
but may be paid up to three Business Days after receipt of a properly executed
redemption request. For example, payment may be delayed if the Federal Reserve
Bank is closed on the day redemption proceeds would ordinarily be wired. After
a wire has been initiated by Goldman Sachs, neither Goldman Sachs nor the
Trust assumes any further responsibility for the performance of intermediaries
or the FST Shareholder's bank in the transfer process. If a problem with such
performance arises, the FST Shareholder should deal directly with such inter-
mediaries or bank.
An FST Shareholder may change the bank designated to receive redemption pro-
ceeds by providing a written notice to Goldman Sachs which has been signed by
the FST Shareholder or its authorized representative. This signature must be
guaranteed by a bank, a securities broker or dealer, a credit union having au-
thority to issue signature guarantees, a savings and loan association, a
building and loan association, a cooperative bank, a federal savings bank or
association, a national securities exchange, a registered securities associa-
tion or a clearing agency, provided that such institution satisfies the stan-
dards established by Goldman Sachs. Goldman Sachs may also require additional
documentation in connection with a request to change the designated bank.
OTHER REDEMPTION INFORMATION
A minimum account balance of $10 million is required to remain a FST Share-
holder. The Trust and Goldman Sachs each reserves the right to waive the mini-
mum account balance. The Trust also reserves the right to redeem shares of a
shareholder account if the balance is less than the minimum described above.
The Trust will give sixty (60) days' prior written notice to such shareholders
whose FST Shares are to be redeemed to allow them to purchase sufficient addi-
tional FST Shares to avoid such redemption.
----------------
31
<PAGE>
APPENDIX
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON ACCOUNT INFORMATION FORM
You are required by law to provide the Fund with your correct Social Secu-
rity or other Taxpayer Identification Number (TIN), regardless of whether you
file tax returns. Failure to do so may subject you to penalties. Failure to
provide your correct TIN and to sign your name in the certification section of
the Account Information Form could result in withholding of 31% by the Fund
for the federal backup withholding tax on distributions, redemptions, ex-
changes and other payments relating to your account.
Any tax withheld may be credited against taxes owed on your federal income
tax return.
If you do not have a TIN, you should apply for one immediately by contacting
your local office of the Social Security Administration or the Internal Reve-
nue Service (IRS). Backup withholding could apply to payments relating to your
account prior to the Fund's receipt of your TIN.
Special rules apply for certain entities. For example, for an account estab-
lished under a Uniform Gifts or Transfers to Minors Act, the TIN of the minor
should be furnished.
If you have been notified by the IRS that you are subject to backup with-
holding because you failed to report all your interest and/or dividend income
on your tax return and you have not been notified by the IRS that such with-
holding should cease, you must cross out item (2) in the certification section
of the Account Information Form.
If you are an exempt recipient, you should furnish your TIN and certify your
exemption by signing the Certification section and writing "exempt" after your
signature. Exempt recipients include: corporations, tax-exempt pension plans
and IRA's, governmental agencies, financial institutions, registered securi-
ties and commodities dealers and others.
If you are a nonresident alien or foreign entity, you must provide a com-
pleted Form W-8 to the Fund in order to avoid backup withholding on certain
payments. Other payments to you may be subject to non-resident alien withhold-
ing of up to 30%.
For further information regarding backup and nonresident alien withholding,
see Sections 3406, 1441 and 1442 of the Internal Revenue Code and consult your
tax adviser.
A-1
<PAGE>
GOLDMAN
SACHS
GOLDMAN SACHS FUNDS--INSTITUTIONAL ACCOUNT INFORMATION FORM
This Account Information Form Should be Forwarded Promptly to Goldman, Sachs &
Co.
No Redemption Can be Made Prior to Its Receipt
Master No. _________________
Send to: Goldman Sachs Funds Fund Use Only
4900 Sears Tower
Chicago, IL 60606 Date: ______________________
1-800-621-2550
[ ] GOLDMAN SACHS MONEY MARKET FUNDS [ ] GOLDMAN SACHS FIXED INCOME FUNDS
Fill in Fund(s) and Class(es)* of Fill in Fund(s) and Class(es)* of
Shares or Fund number(s): Shares or Fund number(s):
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
[ ] GOLDMAN SACHS EQUITY FUNDS [ ] OTHER
Fill in Fund(s) and Class(es)* of Fill in Fund(s) and Class(es)* of
Shares or Fund number(s): Shares or Fund number(s):
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
------------------------------------- -------------------------------------
* A separate Account Application must be completed for purchases of retail
Class A, Class B or Class C Shares of any Goldman Sachs Fund. This form is
not valid if submitted in connection with the purchase of retail Class A, B
or C Shares of any Fund.
A. ACCOUNT RECORD
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
Name of Account Telephone Number
- --------------------------------------- U.S. Citizen or Resident? Yes [ ] No [ ]
Street or P.O. Box
If "No" is checked, fill in country of
- --------------------------------------- tax residence:
City State Zip
- --------------------------------------- ---------------------------------------
Attention
B. DIVIDENDS AND DISTRIBUTIONS - (see the Prospectus for more information)
- --------------------------------------------------------------------------------
For all Goldman Sachs Equity Funds and
the Global Income Fund, please check
the appropriate box(es):
Dividends [ ] Cash [ ] Units/Shares
[ ] Cash [ ] Units/Shares
Capital gains (including short-term and long-term) [ ] Units/Shares
Dividends and capital gains
reinvested in another Goldman
Sachs Fund (See Prospectus for
more information.)
Fill in Fund(s): _______________________
------------------------------
For all other Goldman Sachs Funds,
pleasecheck the appropriate box(es):
Dividends (including net short-term [ ] Cash [ ] Units/Shares
capital gains)
Net long-term capital gains [ ] Cash [ ] Units/Shares
Dividends and capital gains [ ] Units/Shares
reinvested in another Goldman
Sachs Fund (See Prospectus for
more information.)
Fill in Fund(s): _______________________
------------------------------
(If no box is checked, dividends and capital gains distributions will be rein-
vested in Units/Shares in the account.)
Continued on next page
<PAGE>
C. SOCIAL SECURITY NUMBER OR OTHER TAXPAYER IDENTIFICATION NUMBER CERTIFICA-
TION
- -------------------------------------------------------------------------------
Taxpayer Identification Number: __________________
Under penalties of perjury, I certify that (1) the number shown on this form
is my correct Taxpayer Identification Number (or I am waiting for a number to
be issued to me), and (2) I am not subject to backup withholding because I am
exempt from backup withholding or I have not been notified by the Internal
Revenue Service (IRS) that I am subject to backup withholding as a result of a
failure to report all interest or dividends, or the IRS has notified me that I
am no longer subject to backup withholding. See the "Guidelines for Certifica-
tion of Taxpayer Identification Number on Account Information Form," contained
in the Appendix to the accompanying Prospectus.
SIGN
HERE ------------------------------- ---------------------------------------
Signature Name (print) and Title (if any)
------------------------------- ---------------------------------------
Date
D. OPTIONAL TELEPHONE EXCHANGE (see the Prospectus for more information)
- -------------------------------------------------------------------------------
[] GOLDMAN, SACHS & CO. is hereby authorized to accept and act upon telephone
instructions from the undersigned or any other person for the exchange of
Units/Shares of the Fund into any Fund described in the accompanying Pro-
spectus. The undersigned understands and agrees that neither the applicable
Fund nor GOLDMAN, SACHS & Co. will be liable for any loss, expense, or cost
arising out of any telephone request.
E. REDEMPTION PLANS - Check one box only (see the Prospectus for more informa-
tion)
- -------------------------------------------------------------------------------
[] I authorize GOLDMAN, SACHS & CO. to honor telephone, telegraphic, or other
instructions WITHOUT A MEDALLION SIGNATURE GUARANTEE, from any person for
the redemption of Units/Shares for the above account provided that the pro-
ceeds are transmitted either to the following bank account(s) or mailed to
the address of record of the account, as specified below. I understand any
changes to the following information must be made in writing to GOLDMAN,
SACHS & CO., must contain the appropriate number of signatures listed below
and all signatures MUST BE MEDALLION SIGNATURE GUARANTEED. Absent its own
gross negligence, neither the applicable Fund nor GOLDMAN, SACHS & CO. shall
be liable for such redemptions or for payments made to any unauthorized ac-
count.
[] I have furnished GOLDMAN, SACHS & CO. WITH A MEDALLION SIGNATURE GUARANTEE
(See section H). I authorize GOLDMAN, SACHS & CO. to honor telephone, tele-
graphic, or other instructions from any person for the redemption of
Units/Shares for the above account provided that the proceeds are transmit-
ted either to the following bank account(s) or mailed to the address of rec-
ord of the account, as specified below. Any changes to the following infor-
mation must be made in writing to GOLDMAN, SACHS & CO. (but WITHOUT MEDAL-
LION SIGNATURE GUARANTEE) and contain the appropriate number of signatures
listed below. Absent its own gross negligence, neither the applicable Fund
nor GOLDMAN, SACHS & CO. shall be liable for such redemptions or for pay-
ments made to any unauthorized account.
Check the appropriate box below specifying how redemption proceeds shall be
transmitted to you:
[] BY WIRE (transmitted to my bank account(s) designated below).
or
[] BY MAIL. Please mail a check to the address of record of the account set
forth in Section A.
If you indicated that redemption proceeds should be wired to your bank ac-
count(s), please complete the following bank account information and place a
line through the unused portion.
Number of Bank Account Destinations completed in Section E of this form: q
1) ____________________________________3) ____________________________________
Bank Name Bank Routing No. Bank Name Bank Routing No.
------------------------------------- ---------------------------------------
Street Address Street Address
------------------------------------- ---------------------------------------
City State Zip City State Zip
------------------------------------- ---------------------------------------
Account Name Account No. Account Name Account No.
2) ____________________________________4) ____________________________________
Bank Name Bank Routing No. Bank Name Bank Routing No.
------------------------------------- ---------------------------------------
Street Address Street Address
------------------------------------- ---------------------------------------
City State Zip City State Zip
------------------------------------- ---------------------------------------
Account Name Account No. Account Name Account No.
Continued on next page
<PAGE>
5) ____________________________________6) ____________________________________
Bank Name Bank Routing No. Bank Name Bank Routing No.
------------------------------------- ---------------------------------------
Street Address Street Address
------------------------------------- ---------------------------------------
City State Zip City State Zip
------------------------------------- ---------------------------------------
Account Name Account No. Account Name Account No.
Additional instructions may be added on page 4 of this Form, if necessary.
F. CHECKWRITING PRIVILEGE - FOR ILA MONEY MARKET FUND ACCOUNTS ONLY (OPTIONAL)
- -------------------------------------------------------------------------------
[] I have invested in a Goldman Sachs ILA Money Market Portfolio and would like
to have the checkwriting privilege. Please send a signature card for
checkwriting to me at the address listed in Section A.
G. SIGNATURE AUTHORIZATION
- -------------------------------------------------------------------------------
By the execution of this Account Information Form, the undersigned represents
and warrants that it has full right, power and authority to make the invest-
ment applied for pursuant to this application and is acting for itself or in
some fiduciary capacity in making such investment, and that the individual(s)
signing on behalf of the undersigned represent and warrant that they are duly
authorized to sign this application and to purchase and redeem Fund
Units/Shares on behalf of the undersigned. The undersigned affirms that it has
received and reviewed a current Fund Prospectus. THE UNDERSIGNED UNDERSTANDS
THAT NON-MONEY MARKET FUNDS DO NOT MAINTAIN A CONSTANT NET ASSET VALUE AND
FURTHER THAT A CONSTANT NET ASSET VALUE IN MONEY MARKET FUNDS IS NOT GUARAN-
TEED. AS A RESULT, THE UNDERSIGNED MAY EXPERIENCE A LOSS OF PRINCIPAL ON ITS
INVESTMENTS.
Number of signatures required to make changes to this form. [ ]
SIGN
HERE ------------------------------- ---------------------------------------
Signature Name (print) and Title (if any) Date
------------------------------- ---------------------------------------
Signature Name (print) and Title (if any) Date
------------------------------- ---------------------------------------
Signature Name (print) and Title (if any) Date
H. SIGNATURE GUARANTEE
- -------------------------------------------------------------------------------
- ----------------------------------- AFFIX MEDALLION GUARANTEE STAMP HERE
Signature Guaranteed By
- -----------------------------------
Authorized Signature
<PAGE>
Please use the space below to provide additional Bank Account Destinations, if
any, to which you wish redemption proceeds to be wired in accordance with Sec-
tion E of this Form. Please include these destinations when specifying the to-
tal number of Bank Account Designations you have provided in the box in Sec-
tion E.
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FST SHARES
4900 SEARS TOWER
CHICAGO, ILLINOIS 60606
TOLL FREE: 800-621-2550
-----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Shareholder and Fund Expenses.............................................. 2
Financial Highlights....................................................... 4
An Introduction to the Funds............................................... 12
Investment Policies Matrix................................................. 14
Description of Securities and Investment Techniques........................ 16
Investment Limitations..................................................... 21
Management................................................................. 22
Taxes...................................................................... 23
Net Asset Value............................................................ 25
Yield Information.......................................................... 25
Organization and Shares of the Trust....................................... 26
Purchase of Shares......................................................... 27
Reports to Shareholders.................................................... 28
Distributions.............................................................. 29
Exchanges.................................................................. 29
Redemption of Shares....................................................... 29
Appendix................................................................... A-1
Account Information Form
</TABLE>
FSPROINSTMM
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST SHARES
-----------
PROSPECTUS
-----------
MANAGED BY
GOLDMAN SACHS ASSET MANAGEMENT
A SEPARATE OPERATING DIVISION OF
GOLDMAN, SACHS & CO.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST ADMINISTRATION SHARES
4900 Sears Tower
Chicago, Illinois 60606
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management invest-
ment company (a "mutual fund") which includes the Financial Square Funds (the
"Funds"). This Prospectus relates only to the offering of FST Administration
shares of beneficial interest ("FST Administration Shares") of the Funds.
Goldman Sachs Asset Management, a separate operating division of Goldman,
Sachs & Co., serves as each Fund's investment adviser. Goldman, Sachs & Co.
serves as each Fund's distributor and transfer agent.
The following Funds seek to maximize current income to the extent consistent
with the preservation of capital and the maintenance of liquidity by investing
exclusively in high quality money market instruments. The Funds may invest in
diversified portfolios of the following types of instruments:
Financial Square Prime Obligations Fund. Securities of the U.S. Government,
its agencies, authorities and instrumentalities, obligations of U.S. banks,
commercial paper and other short-term obligations of U.S. companies, states,
municipalities and other entities, and repurchase agreements.
Financial Square Money Market Fund. Securities of the U.S. Government, its
agencies, authorities and instrumentalities, U.S. dollar denominated obliga-
tions of U.S. and foreign banks, U.S. dollar denominated commercial paper and
other short-term obligations of U.S. and foreign companies, foreign govern-
ments, states, municipalities and other entities, and repurchase agreements.
Financial Square Premium Money Market Fund. Securities of the U.S. Govern-
ment, its agencies, authorities and instrumentalities, U.S. dollar denominated
obligations of U.S. and foreign banks, U.S. dollar denominated commercial pa-
per and other short-term obligations of U.S. and foreign companies, foreign
governments, states, municipalities and other entities, and repurchase agree-
ments. In order to obtain a rating from a rating organization, the Fund will
observe special investment restrictions.
Financial Square Treasury Obligations Fund. Securities issued or guaranteed
by the U.S. Treasury and repurchase agreements relating to such securities.
Financial Square Treasury Instruments Fund. Securities issued or guaranteed
by the U.S. Treasury, the interest income from which is generally exempt from
state income taxation.
Financial Square Government Fund. Securities of the U.S. Government, its
agencies, authorities, and instrumentalities, and repurchase agreements relat-
ing to such securities.
Financial Square Federal Fund. Securities of the U.S. Government and certain
of its agencies, authorities and instrumentalities, the interest income from
which is generally exempt from state income taxation.
Financial Square Tax-Free Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes and
not an item of tax preference under the federal alternative minimum tax.
Financial Square Municipal Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes (but
not necessarily exempt from federal alternative minimum tax or state and local
taxes).
AN INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOV-
ERNMENT AND THERE CAN BE NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- -------------------------------------------------------------------------------
ADDITIONAL INFORMATION............. Goldman Sachs Funds-Toll Free: 800-621-2550
This Prospectus provides you with information about the Funds that you should
know before investing in FST Administration Shares. It should be read and re-
tained for future reference. If you would like more detailed information, the
Statement of Additional Information dated September 5, 1997, as amended or
supplemented from time to time, is available upon request without charge from
Service Organizations, as defined herein, or by calling the telephone number
listed above or by writing Goldman Sachs, Attention: Shareholder Services,
Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606. The Statement
of Additional Information, which is incorporated by reference into this Pro-
spectus, has been filed with the Securities and Exchange Commission. Not all
Funds are available in certain states. Please call the phone number listed
above to determine availability in your state. The SEC maintains a Web site
(http://www.sec.gov) that contains the Statement of Additional Information and
other information regarding the Trust.
- -------------------------------------------------------------------------------
FST ADMINISTRATION SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, ANY BANK OR OTHER INSURED DEPOSITORY INSTITUTION,
AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN A FUND INVOLVES
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is September 5, 1997.
<PAGE>
SHAREHOLDER AND FUND EXPENSES
FST ADMINISTRATION SHARES
<TABLE>
<CAPTION>
FINANCIAL FINANCIAL FINANCIAL
FINANCIAL FINANCIAL SQUARE FINANCIAL FINANCIAL SQUARE SQUARE
SQUARE SQUARE PREMIUM SQUARE SQUARE FINANCIAL FINANCIAL TAX-FREE MUNICIPAL
PRIME MONEY MONEY TREASURY TREASURY SQUARE SQUARE MONEY MONEY
OBLIGATIONS MARKET MARKET OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MARKET MARKET
FUND FUND FUND FUND FUND FUND FUND FUND FUND
----------- --------- --------- ----------- ----------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge
Imposed on
Purchases.......... None None None None None None None None None
Sales Charge Imposed
on Reinvested
Distributions...... None None None None None None None None None
Deferred Sales Load
Imposed on
Redemptions........ None None None None None None None None None
Exchange Fee........ None None None None None None None None None
ANNUAL OPERATING
EXPENSES (1)
(as a percentage of
average daily
net assets)
Management Fees
(after limitations)
(2)................ 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17%
Other Expenses
Administration
Fees.............. 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%
Other Expenses
(after ex-
pense limitations)
(3).............. 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01%
---- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL OPERATING
EXPENSES (4)......... 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% 0.43% 0.43%
==== ==== ==== ==== ==== ==== ==== ==== ====
</TABLE>
EXAMPLE OF EXPENSES
You would pay the following expenses on a hypothetical $1,000 investment,
assuming a 5% annual return and redemption at the end of each time period:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Financial Square Prime Obligations Fund... $ 4 $14 $24 $54
Financial Square Money Market Fund........ $ 4 $14 $24 $54
Financial Square Premium Money Market
Fund..................................... $ 4 $14 N/A N/A
Financial Square Treasury Obligations
Fund..................................... $ 4 $14 $24 $54
Financial Square Treasury Instruments
Fund..................................... $ 4 $14 N/A N/A
Financial Square Government Fund.......... $ 4 $14 $24 $54
Financial Square Federal Fund............. $ 4 $14 N/A N/A
Financial Square Tax-Free Money Market
Fund..................................... $ 4 $14 $24 $54
Financial Square Municipal Money Market
Fund..................................... $ 4 $14 N/A N/A
</TABLE>
2
<PAGE>
- --------
(1) Based on estimated amounts for the current fiscal year for the Financial
Square Premium Money Market, Financial Square Treasury Instruments, Finan-
cial Square Federal and Financial Square Municipal Money Market Funds.
(2) The Investment Adviser has voluntarily agreed not to impose 0.035% of its
management fee for each Fund. Without such limitation, management fees for
each Fund would be 0.205%.
(3) The Investment Adviser has voluntarily agreed to reduce or limit certain
other expenses (excluding management fees, fees payable to Service Organi-
zations, as defined herein, taxes, interest and brokerage and litigation,
indemnification and other extraordinary expenses) to the extent such ex-
penses exceed 0.01% of a Fund's average daily net assets.
(4) Without the limitations described above, "Other Expenses" and "Total Oper-
ating Expenses" of the Financial Square Prime Obligations, Financial
Square Money Market, Financial Square Treasury Obligations, Financial
Square Government and Financial Square Tax-Free Money Market Funds for the
semi annual period ended June 30, 1997, would have been as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Prime Obligations Fund................... .025% .48%
Financial Square Money Market Fund........................ .025% .48%
Financial Square Treasury Obligations Fund................ .035% .49%
Financial Square Government Fund.......................... .015% .47%
Financial Square Tax-Free Money Market Fund............... .015% .47%
</TABLE>
In addition, without the limitations described above, "Other Expenses" and
"Total Operating Expenses" of the Financial Square Premium Money Market, Fi-
nancial Square Treasury Instruments, Financial Square Federal and Financial
Square Municipal Money Market Funds for the current fiscal year are estimated
to be as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Premium Money Market Fund................ .035% .49%
Financial Square Treasury Instruments Fund................ .155% .61%
Financial Square Federal Fund............................. .155% .61%
Financial Square Municipal Money Market Fund.............. .285% .74%
</TABLE>
The information set forth in the foregoing table and hypothetical example
relates only to FST Administration Shares of the Funds. The Funds also offer
FST Shares, FST Preferred Shares and FST Service Shares. The other classes of
the Funds are subject to different fees and expenses (which affect perfor-
mance) and are entitled to different services. Information regarding any other
class of the Funds may be obtained from your sales representative or from
Goldman Sachs by calling the number on the front cover of this Prospectus.
Service Organizations may charge other fees to their customers who are the
beneficial owners of FST Administration Shares in connection with their cus-
tomers' accounts. See "Administration." Such fees, if any, may affect the re-
turn such customers realize with respect to their investments.
The purpose of the foregoing table is to assist investors in understanding
the various fees and expenses of a Fund that an investor will bear directly or
indirectly. The information on fees and expenses included in the table and the
hypothetical example above are based on each Fund's fees and expenses (actual
or estimated) and should not be considered as representative of past or future
expenses. Actual fees and expenses may be greater or less than those indicat-
ed. Moreover, while the example assumes a 5% annual return, a Fund's actual
performance will vary and may result in an actual return greater or less than
5%. See "Management--Investment Adviser."
3
<PAGE>
FINANCIAL HIGHLIGHTS
The following data with respect to a share (of the class specified) of the
Financial Square Prime Obligations, Financial Square Money Market, Financial
Square Treasury Obligations, Financial Square Government and Financial Square
Tax-Free Money Market Funds outstanding during the periods ended on or prior
to December 31, 1996 have been audited by Arthur Andersen LLP, independent
public accountants, whose report, which appears in the annual report to share-
holders of the Funds for the fiscal year ended December 31, 1996 (the "Annual
Report") is incorporated by reference into and attached to the Statement of
Additional Information. The following data for each of the above referenced
funds along with the Financial Square Treasury Instruments and Financial
Square Federal Funds for the period ended June 30, 1997 is unaudited, and de-
rived from financial statements included in the semi-annual report to share-
holders of the Fund for the period ended June 30, 1997, (the "Semi-Annual Re-
port"). The Annual Report and the Semi-Annual Report should be read in con-
junction with the financial statements and related notes incorporated by ref-
erence and attached to the Statement of Additional Information.
Financial Square Municipal Money Market and Financial Square Premium Money
Market Funds had no operations during the periods shown. Accordingly, there
are no selected per share data and ratios presented for these Funds.
4
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding Throughout Each Period
Prime Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET EXPENSES TO INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT AVERAGE INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0267 $ -- $0.0267 $(0.0267) $1.00 5.53%(b) 0.18%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0262 -- 0.0262 (0.0262) 1.00 5.42(b) 0.28(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0255 -- 0.0255 (0.0255) 1.00 5.27(b) 0.43(b) 5.15(b)
1997-FST Service
shares.......... 1.00 0.0243 -- 0.0243 (0.0243) 1.00 5.00(b) 0.68(b) 4.90(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0529 -- 0.0529 (0.0529) 1.00 5.41 0.18 5.29
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0346 -- 0.0346 (0.0346) 1.00 5.28(b) 0.28(b) 5.19(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0506 -- 0.0506 (0.0506) 1.00 5.14 0.43 5.06
1996-FST Service
shares.......... 1.00 0.0478 -- 0.0478 (0.0478) 1.00 4.88 0.68 4.78
1995-FST shares. 1.00 0.0586 -- 0.0586 (0.0586) 1.00 6.02 0.18 5.86
1995-FST Admin-
istration
shares.......... 1.00 0.0559 -- 0.0559 (0.0559) 1.00 5.75 0.43 5.59
1995-FST Service
shares.......... 1.00 0.0533 -- 0.0533 (0.0533) 1.00 5.49 0.68 5.33
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0401 -- 0.0401 (0.0401) 1.00 4.38(b) 0.18(b) 4.38(b)
1994-FST Admin-
istration
shares(d)....... 1.00 0.0383 -- 0.0383 (0.0383) 1.00 4.12(b) 0.43(b) 4.18(b)
1994-FST Service
shares(d)....... 1.00 0.0364 -- 0.0364 (0.0364) 1.00 3.86(b) 0.68(b) 3.98(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0311 0.0002 0.0313 (0.0313) 1.00 3.18 0.17 3.11
1994-FST Admin-
istration
shares.......... 1.00 0.0286 0.0002 0.0288 (0.0288) 1.00 2.92 0.42 2.86
1994-FST Service
shares.......... 1.00 0.0261 0.0002 0.0263 (0.0263) 1.00 2.66 0.67 2.61
1993-FST shares. 1.00 0.0360 0.0007 0.0367 (0.0367) 1.00 3.75 0.18 3.60
1993-FST Admin-
istration
shares(e)....... 1.00 0.0068 0.0001 0.0069 (0.0069) 1.00 3.02(b) 0.44(b) 2.96(b)
1993-FST Service
shares.......... 1.00 0.0301 0.0007 0.0308 (0.0308) 1.00 3.23 0.68 3.01
1992-FST shares. 1.00 0.0572 0.0002 0.0574 (0.0574) 1.00 5.99 0.18 5.72
1992-FST Service
shares(e)....... 1.00 0.0027 -- 0.0027 (0.0027) 1.00 4.10(b) 0.66(b) 4.10(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0727 -- 0.0727 (0.0727) 1.00 8.27(b) 0.18(b) 8.04(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $3,813,081 0.23%(b) 5.34%(b)
1997-FST Pre-
ferred Shares... 240,047 0.33(b) 5.26(b)
1997-FST Admin-
istration
shares.......... 295,977 0.48(b) 5.10(b)
1997-FST Service
shares.......... 121,165 0.73(b) 4.85(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 3,901,797 0.23 5.24
1996-FST Pre-
ferred
shares(c)....... 127,126 0.33(b) 5.14(b)
1996-FST Admin-
istration
shares.......... 215,898 0.48 5.01
1996-FST Service
shares.......... 115,154 0.73 4.73
1995-FST shares. 3,295,791 0.22 5.82
1995-FST Admin-
istration
shares.......... 147,894 0.47 5.55
1995-FST Service
shares.......... 65,278 0.72 5.29
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 2,774,849 0.24(b) 4.32(b)
1994-FST Admin-
istration
shares(d)....... 66,113 0.49(b) 4.12(b)
1994-FST Service
shares(d)....... 41,372 0.74(b) 3.92(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1,831,413 0.25 3.03
1994-FST Admin-
istration
shares.......... 35,250 0.50 2.78
1994-FST Service
shares.......... 14,001 0.75 2.53
1993-FST shares. 813,126 0.25 3.53
1993-FST Admin-
istration
shares(e)....... 1,124 0.52(b) 2.88(b)
1993-FST Service
shares.......... 336 0.75 2.94
1992-FST shares. 917,073 0.27 5.63
1992-FST Service
shares(e)....... 118 0.74(b) 4.02(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 578,495 0.28(b) 7.94(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
(e) FST Administration share and FST Service share activity commenced during
November of 1992 and January of 1992, respectively.
(f) Commencement of operations.
5
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $1.00 $0.0269 $ -- $0.0269 $(0.0269) $1.00 5.57%(b) 0.18%(b) 5.44%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0264 -- 0.0264 (0.0264) 1.00 5.46(b) 0.28(b) 5.36(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0257 -- 0.0257 (0.0257) 1.00 5.30(b) 0.43(b) 5.18(b)
1997-FST Service
shares.......... 1.00 0.0244 -- 0.0244 (0.0244) 1.00 5.04(b) 0.68(b) 4.93(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 1.00 0.0533 0.0001 0.0534 (0.0534) 1.00 5.45 0.18 5.33
1996-FST
Preferred
shares(c)....... 1.00 0.0348 -- 0.0348 (0.0348) 1.00 5.31(b) 0.28(b) 5.23(b)
1996-FST
Administration
shares.......... 1.00 0.0504 0.0001 0.0505 (0.0505) 1.00 5.19 0.43 5.04
1996-FST Service
shares.......... 1.00 0.0484 -- 0.0484 (0.0484) 1.00 4.93 0.68 4.84
1995-FST shares. 1.00 0.0589 -- 0.0589 (0.0589) 1.00 6.07 0.15 5.89
1995-FST
Administration
shares.......... 1.00 0.0561 -- 0.0561 (0.0561) 1.00 5.80 0.40 5.61
1995-FST Service
shares(d)....... 1.00 0.0231 -- 0.0231 (0.0231) 1.00 5.41(b) 0.65(b) 4.93(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 1.00 0.0305 -- 0.0305 (0.0305) 1.00 4.91(b) 0.11(b) 4.88(b)
1994-FST
Administration
shares(d)....... 1.00 0.0298 -- 0.0298 (0.0298) 1.00 4.65(b) 0.36(b) 4.82(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $3,992,002 0.23%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 43,759 0.33(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 276,152 0.48(b) 5.13(b)
1997-FST Service
shares.......... 290,345 0.73(b) 4.88(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 2,540,366 0.23 5.28
1996-FST
Preferred
shares(c)....... 17,510 0.33(b) 5.18(b)
1996-FST
Administration
shares.......... 165,766 0.48 4.99
1996-FST Service
shares.......... 234,376 0.73 4.79
1995-FST shares. 2,069,197 0.23 5.81
1995-FST
Administration
shares.......... 137,412 0.48 5.53
1995-FST Service
shares(d)....... 4,219 0.73(b) 4.85(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 862,971 0.25(b) 4.74(b)
1994-FST
Administration
shares(d)....... 66,560 0.50(b) 4.68(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST, FST Administration and FST Service share activity commenced May 18,
1994, May 20, 1994 and July 14, 1995, respectively.
6
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL RATIO OF NET INVESTMENT
VALUE AT NET GAIN (LOSS) INCOME FROM DISTRIBUTIONS NET ASSET EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS END OF PERIOD RETURN(A) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0262 $0.0001 $0.0263 $(0.0263) $1.00 5.43%(b) 0.18%(b) 5.28%(b)
1997-FST Pre-
ferred shares .. 1.00 0.0257 0.0001 0.0258 (0.0258) 1.00 5.32(b) 0.28(b) 5.18(b)
1997-FST Admin-
istration shares
................. 1.00 0.0249 0.0001 0.0250 (0.0250) 1.00 5.16(b) 0.43(b) 5.03(b)
1997-FST Service
shares ......... 1.00 0.0237 0.0001 0.0238 (0.0238) 1.00 4.90(b) 0.68(b) 4.78(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0522 0.0003 0.0525 (0.0524) 1.00 5.35 0.18 5.22
1996-FST
Preferred
shares(c)....... 1.00 0.0342 0.0001 0.0343 (0.0343) 1.00 5.24(b) 0.28(b) 5.11(b)
1996-FST
Administration
shares.......... 1.00 0.0497 0.0002 0.0499 (0.0498) 1.00 5.09 0.43 4.97
1996-FST Service
shares.......... 1.00 0.0472 0.0002 0.0474 (0.0474) 1.00 4.83 0.68 4.72
1995-FST shares. 1.00 0.0573 0.0005 0.0578 (0.0578) 1.00 5.96 0.18 5.73
1995-FST
Administration
shares.......... 1.00 0.0547 0.0005 0.0552 (0.0552) 1.00 5.69 0.43 5.47
1995-FST Service
shares.......... 1.00 0.0521 0.0005 0.0526 (0.0526) 1.00 5.43 0.68 5.21
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0379 (0.0001) 0.0378 (0.0378) 1.00 4.23(b) 0.18(b) 4.13(b)
1994-FST
Administration
shares(d)....... 1.00 0.0388 (0.0001) 0.0387 (0.0387) 1.00 3.97(b) 0.43(b) 4.24(b)
1994-FST Service
shares(d)....... 1.00 0.0349 (0.0001) 0.0348 (0.0348) 1.00 3.71(b) 0.68(b) 3.82(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0301 0.0007 0.0308 (0.0307) 1.00 3.11 0.17 3.01
1994-FST
Administration
shares.......... 1.00 0.0276 0.0006 0.0282 (0.0281) 1.00 2.85 0.42 2.76
1994-FST Service
shares.......... 1.00 0.0251 0.0008 0.0259 (0.0256) 1.00 2.60 0.67 2.51
1993-FST shares. 1.00 0.0342 0.0012 0.0354 (0.0355) 1.00 3.69 0.18 3.42
1993-FST
Administration
shares(e) ...... 1.00 0.0009 -- 0.0009 (0.0009) 1.00 2.83(b) 0.43(b) 2.83(b)
1993-FST Service
shares.......... 1.00 0.0296 0.0016 0.0312 (0.0309) 1.00 3.17 0.68 2.96
1992-FST shares. 1.00 0.0549 0.0015 0.0564 (0.0561) 1.00 5.84 0.18 5.49
1992-FST Service
shares(e)....... 1.00 0.0113 0.0006 0.0119 (0.0116) 1.00 4.47(b) 0.68(b) 3.77(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0600 0.0006 0.0606 (0.0605) 1.00 8.06(b) 0.21(b) 7.74(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $2,140,063 0.24%(b) 5.22%(b)
1997-FST Pre-
ferred shares .. 2,826 0.34(b) 5.12(b)
1997-FST Admin-
istration shares
................. 638,287 0.49(b) 4.97(b)
1997-FST Service
shares ......... 232,548 0.74(b) 4.72(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 2,291,051 0.24 5.16
1996-FST
Preferred
shares(c)....... 46,637 0.34(b) 5.05(b)
1996-FST
Administration
shares.......... 536,895 0.49 4.91
1996-FST Service
shares.......... 220,560 0.74 4.66
1995-FST shares. 1,587,715 0.23 5.68
1995-FST
Administration
shares.......... 283,186 0.48 5.42
1995-FST Service
shares.......... 139,117 0.73 5.16
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 958,196 0.25(b) 4.06(b)
1994-FST
Administration
shares(d)....... 82,124 0.50(b) 4.17(b)
1994-FST Service
shares(d)....... 81,162 0.75(b) 3.75(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 812,420 0.24 2.94
1994-FST
Administration
shares.......... 24,485 0.49 2.69
1994-FST Service
shares.......... 35,656 0.74 2.44
1993-FST shares. 776,181 0.26 3.34
1993-FST
Administration
shares(e) ...... 1 0.51(b) 2.75(b)
1993-FST Service
shares.......... 5,155 0.76 2.88
1992-FST shares. 413,171 0.28 5.39
1992-FST Service
shares(e)....... 3,634 0.78(b) 3.67(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 229,988 0.34(b) 7.61(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
(e)FST Administration and FST Service share activity commenced during January
of 1993 and October of 1991, respectively.
(f)Commencement of operations.
7
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Instruments Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $1.00 $ 0.0168 0.0002 $ 0.0170 $(0.0170) $1.00 5.29%(b) 0.18%(b) 5.12%(b)
1997-FST Pre-
ferred shares
(c)............. 1.00 0.0043 0.0002 0.0045 (0.0045) 1.00 5.19(b) 0.28(b) 5.04(b)
1997-FST Admin-
istration shares
(c)............. 1.00 0.0122 0.0002 0.0124 (0.0124) 1.00 5.06(b) 0.43(b) 4.89(b)
1997-FST Service
shares (c)...... 1.00 0.0150 0.0002 0.0152 (0.0152) 1.00 4.73(b) 0.68(b) 4.63(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET
ASSETS AT RATIO OF NET
END RATIO OF INVESTMENT
OF PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $237,444 0.36%(b) 4.94%(b)
1997-FST Pre-
ferred shares
(c)............. 2 0.46(b) 4.86(b)
1997-FST Admin-
istration shares
(c)............. 1,132 0.61(b) 4.71(b)
1997-FST Service
shares (c)...... 35,901 0.86(b) 4.45(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the
investment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Share, FST Preferred Share, FST Administration Share, and FST Service
Share activity commenced March 3, 1997, May 30, 1997, April 1, 1997, and
March 5, 1997, respectively.
8
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Government Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
----------------------------------------
NET ASSET TOTAL
VALUE AT NET NET REALIZED GAIN INCOME FROM DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT END TOTAL
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... $1.00 $ 0.0264 $0.0001 $ 0.0265 $(0.0265) $1.00 5.47%(b)
1997-FST Preferred
shares............... 1.00 0.0259 0.0001 0.0260 (0.0260) 1.00 5.37(b)
1997-FST Administra-
tion shares.......... 1.00 0.0251 0.0001 0.0252 (0.0252) 1.00 5.21(b)
1997-FST Service
shares............... 1.00 0.0239 0.0001 0.0240 (0.0240) 1.00 4.95(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 1.00 0.0525 0.0001 0.0526 (0.0526) 1.00 5.38
1996-FST Preferred
shares(c)............ 1.00 0.0344 0.0001 0.0345 (0.0345) 1.00 5.26(b)
1996-FST Administra-
tion shares.......... 1.00 0.0501 0.0001 0.0502 (0.0502) 1.00 5.12
1996-FST Service
shares............... 1.00 0.0474 0.0001 0.0475 (0.0475) 1.00 4.86
1995-FST shares...... 1.00 0.0581 0.0001 0.0582 (0.0582) 1.00 6.00
1995-FST Administra-
tion shares.......... 1.00 0.0554 0.0001 0.0555 (0.0555) 1.00 5.74
1995-FST Service
shares(d)............ 1.00 0.0320 -- 0.0320 (0.0320) 1.00 5.40(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 1.00 0.0424 -- 0.0424 (0.0424) 1.00 4.36(b)
1994-FST Administra-
tion shares(e)....... 1.00 0.0426 -- 0.0426 (0.0426) 1.00 4.10(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 1.00 0.0256 0.0001 0.0257 (0.0257) 1.00 3.14(b)
1993-FST Administra-
tion shares(d)....... 1.00 0.0120 0.0001 0.0121 (0.0121) 1.00 2.87(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET RATIO OF NET
RATIO OF NET INVESTMENT NET RATIO OF INVESTMENT
EXPENSES TO INCOME TO ASSETS AT END EXPENSES TO INCOME TO
AVERAGE NET AVERAGE NET OF PERIOD AVERAGE NET AVERAGE NET
ASSETS ASSETS (IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... 0.18%(b) 5.33%(b) $1,222,437 0.22%(b) 5.29%(b)
1997-FST Preferred
shares............... 0.28(b) 5.32(b) 48,896 0.32(b) 5.28(b)
1997-FST Administra-
tion shares.......... 0.43(b) 5.07(b) 190,742 0.47(b) 5.03(b)
1997-FST Service
shares............... 0.68(b) 4.83(b) 603,520 0.72(b) 4.79(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 0.18 5.25 858,769 0.24 5.19
1996-FST Preferred
shares(c)............ 0.28(b) 5.14(b) 112 0.34(b) 5.08(b)
1996-FST Administra-
tion shares.......... 0.43 5.01 145,108 0.49 4.95
1996-FST Service
shares............... 0.68 4.74 223,554 0.74 4.68
1995-FST shares...... 0.18 5.81 743,884 0.24 5.75
1995-FST Administra-
tion shares.......... 0.43 5.54 82,386 0.49 5.48
1995-FST Service
shares(d)............ 0.68(b) 5.08(b) 14,508 0.74(b) 5.02(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 0.15(b) 4.64(b) 258,350 0.25(b) 4.54(b)
1994-FST Administra-
tion shares(e)....... 0.40(b) 4.67(b) 54,253 0.50(b) 4.57(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 0.08(b) 3.10(b) 44,697 0.59(b) 2.59(b)
1993-FST Administra-
tion shares(d)....... 0.35(b) 2.85(b) 14,126 0.76(b) 2.44(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced April 6, 1993, September 1, 1993 and May 16, 1995, respectively.
(e) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
9
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Federal Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-----------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN ON INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $1.00 $ 0.0178 -- $ 0.0178 $ (0.0178) $1.00 5.47%(b) 0.18%(b) 5.36%(b)
1997-FST Pre-
ferred
shares(c)....... 1.00 0.0047 -- 0.0047 (0.0047) 1.00 5.46(b) 0.28(b) 5.28(b)
1997-FST Admin-
istration
shares(c)....... 1.00 0.0128 -- 0.0128 (0.0128) 1.00 5.25(b) 0.43(b) 5.17(b)
1997-FST Service
shares(c)....... 1.00 0.0131 -- 0.0131 (0.0131) 1.00 4.99(b) 0.68(b) 4.90(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
NET EXPENSE LIMITATIONS
ASSETS -------------------------
AT END RATIO OF NET
OF RATIO OF INVESTMENT
PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $714,024 0.36%(b) 5.18%(b)
1997-FST Pre-
ferred
shares(c)....... 2 0.46(b) 5.10(b)
1997-FST Admin-
istration
shares(c)....... 137,933 0.61(b) 4.99(b)
1997-FST Service
shares(c)....... 122,323 0.86(b) 4.72(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST share, FST Preferred share, FST Administration share, and FST Service
share activity commenced February 28, 1997, May 30, 1997, April 1, 1997 and
March 25, 1997, respectively.
10
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Tax-Free Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET NET TOTAL
ASSET NET REALIZED INCOME NET ASSET RATIO OF NET
VALUE AT INVEST- GAIN ON FROM DISTRIBUTIONS VALUE AT EXPENSES TO
BEGINNING MENT INVESTMENT INVESTMENT TO END OF TOTAL AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS PERIOD RETURN (A) ASSETS
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $ 0.0170 -- $ 0.0170 $(0.0170) $1.00 3.49%(b) 0.18%(b)
1997-FST Pre-
ferred shares... 1.00 0.0165 -- 0.0165 (0.0165) 1.00 3.39(b) 0.28(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0158 -- 0.0158 (0.0158) 1.00 3.23(b) 0.43(b)
1997-FST Service
shares.......... 1.00 0.0146 -- 0.0146 (0.0146) 1.00 2.97(b) 0.68(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 1.00 0.0335 -- 0.0335 (0.0335) 1.00 3.39 0.18
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0218 -- 0.0218 (0.0218) 1.00 3.30(b) 0.28(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0310 -- 0.0310 (0.0310) 1.00 3.13 0.43
1996-FST Service
shares.......... 1.00 0.0285 -- 0.0285 (0.0285) 1.00 2.88 0.68
1995-FST shares. 1.00 0.0381 -- 0.0381 (0.0381) 1.00 3.89 0.14
1995-FST Admin-
istration
shares.......... 1.00 0.0354 -- 0.0354 (0.0354) 1.00 3.63 0.39
1995-FST Service
shares.......... 1.00 0.0332 -- 0.0332 (0.0332) 1.00 3.38 0.64
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 1.00 0.0156 -- 0.0156 (0.0156) 1.00 3.41(b) 0.07(b)
1994-FST
Administration shares(d). 1.00 0.0136 -- 0.0136 (0.0136) 1.00 3.19(b) 0.32(b)
1994-FST Service
shares(d)....... 1.00 0.0091 -- 0.0091 (0.0091) 1.00 3.11(b) 0.57(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET NET RATIO OF NET
INVESTMENT ASSETS AT RATIO OF INVESTMENT
INCOME TO END OF EXPENSES TO INCOME TO
AVERAGE NET PERIOD AVERAGE NET AVERAGE NET
ASSETS (IN 000'S) ASSETS ASSETS
-------------------------------------------------
<S> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... 3.46%(b) $731,783 0.22%(b) 3.42%(b)
1997-FST Pre-
ferred shares... 3.24(b) 5,468 0.32(b) 3.20(b)
1997-FST Admin-
istration
shares.......... 3.25(b) 96,496 0.47(b) 3.21(b)
1997-FST Service
shares.......... 2.94(b) 27,597 0.72(b) 2.90(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 3.35 440,838 0.23 3.30
1996-FST Pre-
ferred
shares(c)....... 3.26(b) 28,731 0.33(b) 3.21(b)
1996-FST Admin-
istration
shares.......... 3.10 51,661 0.48 3.05
1996-FST Service
shares.......... 2.85 19,855 0.73 2.80
1995-FST shares. 3.81 448,367 0.24 3.71
1995-FST Admin-
istration
shares.......... 3.54 20,939 0.49 3.44
1995-FST Service
shares.......... 3.32 19,860 0.74 3.22
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 3.42(b) 183,570 0.31(b) 3.18(b)
1994-FST
Administration shares(d). 3.25(b) 2,042 0.56(b) 3.01(b)
1994-FST Service
shares(d)....... 3.32(b) 2,267 0.81(b) 3.08(b)
</TABLE>
- --------------
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced July 19, 1994, August 1, 1994 and September 23, 1994, respectively.
11
<PAGE>
AN INTRODUCTION TO THE FUNDS
THE TRUST: The Trust is a no-load, open-end, management investment company
registered under the Investment Company Act of 1940, as amended (the "Invest-
ment Company Act"). Each Fund is a separate pool of assets which pursues its
investment objective through separate investment policies, as described below.
THE ADVISER: Goldman Sachs Asset Management, a separate operating division
of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds' investment ad-
viser (the "Adviser" or "GSAM").
THE DISTRIBUTOR: Goldman Sachs, which serves as the Funds' distributor and
transfer agent, is one of the largest international investment banking and
brokerage firms in the United States.
THE INVESTORS: The Funds are designed for institutional investors seeking a
high rate of return, a stable net asset value and convenient liquidation priv-
ileges. The Funds are particularly suitable for banks, corporations and other
financial institutions that seek investment of short-term funds for their own
accounts or for the accounts of their customers. Shares of the Government Fund
are intended to qualify as eligible investments for Federally chartered credit
unions pursuant to Sections 107(7), 107(8) and 107(15) of the Federal Credit
Union Act, Part 703 of the National Credit Union Administration ("NCUA") Rules
and Regulations and NCUA Letter Number 155. The Fund intends to review changes
in the applicable laws, rules and regulations governing eligible investments
for federally chartered credit unions, and to take such action as may be nec-
essary so that the investments of the Fund qualify as eligible investments un-
der the Federal Credit Union Act and the regulations thereunder. Shares of the
Government Fund, however, may or may not qualify as eligible investments for
particular state chartered credit unions. State chartered credit unions should
consult qualified legal counsel to determine whether the Government Fund is a
permissible investment under the law applicable to it.
THE FUNDS: Each Fund's securities are valued by the amortized cost method as
permitted by a rule ("Rule 2a-7") of the Securities and Exchange Commission
("SEC"). Under such rule, each Fund may invest only in securities that are de-
termined to present minimal credit risk and meet certain other criteria.
TAXABLE FUNDS: Prime Obligations, Money Market, Premium Money Market,
Treasury Obligations and Government Funds.
TAX ADVANTAGED FUNDS: Treasury Instruments and Federal Funds.
TAX-EXEMPT FUNDS: Tax-Free Money Market and Municipal Money Market Funds.
INVESTMENT OBJECTIVES AND POLICIES FOR TAXABLE, TAX-ADVANTAGED AND TAX-
EXEMPT FUNDS: To maximize current income to the extent consistent with the
preservation of capital and the maintenance of liquidity by investing ex-
clusively in high quality money market instruments. In order to obtain a
rating from a rating organization, the Premium Money Market Fund will ob-
serve special investment restrictions. The Treasury Instruments and Federal
Funds pursue their objectives by limiting their investments to certain U.S.
Treasury Obligations and U.S. Government Securities (each as defined here-
in), respectively, the interest from which is generally exempt from state
income taxation. Each investor should consult his or her tax adviser to de-
termine whether distributions from the Treasury Instruments and Federal
Funds (and any other Fund that may hold such obligations) derived from in-
terest on such obligations are exempt from state income taxation in the in-
vestor's own state.
NET ASSET VALUE: Each Fund seeks to maintain a stable net asset value of
$1.00 per share.
MAXIMUM REMAINING MATURITY OF PORTFOLIO INVESTMENTS: Thirteen months at the
time of purchase.
12
<PAGE>
DOLLAR-WEIGHTED AVERAGE PORTFOLIO MATURITY ("WAM"): Not more than ninety
days as required by Rule 2a-7.
FIRST TIER SECURITIES: Each Fund may purchase securities which are rated (or
that have been issued by an issuer that is rated with respect to a class of
short-term debt obligations, or any security within that class, comparable in
priority and quality with such securities) in the highest short-term rating
category by at least two NRSROs (as defined below), or if only one NRSRO has
assigned a rating, by that NRSRO. U.S. Government Securities as defined herein
are considered First Tier Securities.
SECOND TIER SECURITIES: The Tax-Exempt Funds may purchase securities which
are not First Tier Securities but which are rated in the top two short-term
rating categories by at least two NRSROs, or if only one NRSRO has assigned a
rating, by that NRSRO. The Taxable Funds will not invest in a security which
is a Second Tier Security at the time of purchase.
UNRATED SECURITIES: To the extent permitted by Rule 2a-7, unrated securities
may be purchased if they are deemed to be of comparable quality to First Tier
Securities, or to the extent that a Fund may purchase Second Tier Securities,
comparable in quality to Second Tier Securities.
NRSROS: Nationally Recognized Statistical Rating Organizations include Stan-
dard & Poor's Ratings Group ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Fitch Investors Services, Inc., Duff and Phelps, Inc., IBCA Lim-
ited and its affiliate IBCA Inc., and Thomson BankWatch, Inc. For a descrip-
tion of each NRSRO's rating categories, see Appendix A to the Statement of Ad-
ditional Information.
13
<PAGE>
INVESTMENT POLICIES MATRIX
<TABLE>
<CAPTION>
SHORT-TERM
OBLIGATIONS OF ASSET-BACKED & FOREIGN
US US CORPORATIONS RECEIVABLES- GOVERNMENT
TREASURY GOVERNMENT BANK COMMERCIAL AND OTHER REPURCHASE BACKED OBLIGATIONS
FUND OBLIGATIONS SECURITIES OBLIGATIONS PAPER ENTITIES AGREEMENTS SECURITIES+ (US$)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Prime Obligations [_] [_] [_] [_] [_] [_] [_]
U.S. banks U.S. entities
only only
- ------------------------------------------------------------------------------------------------------------------------
Money Market [_] [_] [_] [_] [_] [_] [_] [_]
Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Premium Money [_] [_] [_] [_] [_] [_] [_] [_]
Market Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_] [_]
Obligations
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_]
Instruments
- ------------------------------------------------------------------------------------------------------------------------
Government [_] [_] [_]
- ------------------------------------------------------------------------------------------------------------------------
Federal [_] [_] (Does not
intend to
invest)
- ------------------------------------------------------------------------------------------------------------------------
Tax-Free Money [_]
Market Tax-exempt
only
- ------------------------------------------------------------------------------------------------------------------------
Municipal Money [_]
Market Tax-exempt
only
</TABLE>
Note: See "Description of Securities and Investment Techniques" for a descrip-
tion of, and certain criteria applicable to, each of these categories of
investments.
+To the extent required by Rule 2a-7, asset-backed and receivables-backed
securities will be rated by the requisite number of NRSROs.
14
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
SUMMARY OF
TAXABLE TAX-EXEMPT CREDIT INVESTMENT UNRATED TAXATION FOR
MUNICIPALS MUNICIPALS QUALITY**** COMPANIES SECURITIES DISTRIBUTIONS* MISCELLANEOUS
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
[_] First [_] [ ] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
[_] First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
[_]
First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets generally
in other exempt from
investment state taxation
companies
- ---------------------------------------------------------------------------------------------------
First [_]
Tier Up to 10% of Taxable
total assets federal and
in other state**
investment
companies
- ---------------------------------------------------------------------------------------------------
Under
First [_] Taxable extraordinary
Tier Up to 10% of federal and circumstances,
total assets generally may hold cash,
in other exempt from U.S. Government
investment state taxation Securities
companies subject to state
taxation or cash
equivalents
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May (but does
At least 80% of Second Up to 10% of federal and not currently
net assets in Tier total assets taxable intend to)
Municipal in other state*** invest up to 20%
Instruments investment in AMT
(except in companies securities and
extraordinary may temporarily
circumstances) invest in the
taxable money
market
instruments
described herein
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May invest up to
At least 80% of Second Up to 10% of federal and 100% in AMT
net assets in Tier total assets taxable securities and
Municipal in other state*** may temporarily
Instruments investment invest in the
(except in companies taxable money
extraordinary market
circumstances) instruments
described herein
- ---------------------------------------------------------------------------------------------------
</TABLE>
* See "Taxes" below for an explanation of the tax consequences summarized
in the table above.
** Taxable in many states except for distributions from U.S. Treasury obli-
gation interest income and certain U.S. Government securities interest
income.
*** Taxable except for distributions from interest on obligations of an in-
vestor's state of residence in certain states.
**** To the extent permitted by Rule 2a-7, a Fund holding a security fully
supported by a guarantee may substitute the credit quality of the guaran-
tee in determining the credit quality of the security.
15
<PAGE>
DESCRIPTION OF SECURITIES AND INVESTMENT TECHNIQUES
U.S. TREASURY OBLIGATIONS
"U.S. Treasury Obligations" are securities issued or guaranteed by the U.S.
Treasury, payments of principal and interest on which are backed by the full
faith and credit of the U.S. Government.
U.S. GOVERNMENT SECURITIES
"U.S. Government Securities" are obligations issued or guaranteed by the
U.S. Government, its agencies, authorities or instrumentalities. Unlike U.S.
Treasury Obligations, securities issued or guaranteed by U.S. Government agen-
cies, authorities or instrumentalities are supported either by (a) the full
faith and credit of the U.S. Government (such as securities of the Government
National Mortgage Association), (b) the right of the issuer to borrow from the
Treasury (such as securities of the Student Loan Marketing Association), (c)
the discretionary authority of the U.S. Government to purchase the agency's
obligations (such as securities of the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation), or (d) only the credit of the
issuer. No assurance can be given that the U.S. Government will provide finan-
cial support to U.S. Government agencies, authorities or instrumentalities in
the future. U.S. Government Securities may include zero coupon bonds. Such
bonds may be purchased when yields are attractive.
Securities guaranteed as to principal and interest by the U.S. Government,
its agencies, authorities or instrumentalities are deemed to include (a) secu-
rities for which the payment of principal and interest is backed by an irrevo-
cable letter of credit issued by the U.S. Government, its agencies, authori-
ties or instrumentalities and (b) participations in loans made to foreign gov-
ernments or their agencies that are so guaranteed. The secondary market for
certain of these participations is limited. Such participations may therefore
be regarded as illiquid.
Each Fund may also invest in separately traded principal and interest compo-
nents of securities guaranteed or issued by the U.S. Treasury if such compo-
nents are traded independently under the Separate Trading of Registered Inter-
est and Principal of Securities program ("STRIPS").
The Treasury Instruments and Federal Funds invest in U.S. Treasury Obliga-
tions and the Federal Fund may also invest in certain U.S. Government Securi-
ties the interest from which is generally exempt from state income taxation.
Securities generally eligible for this exemption include those issued by the
U.S. Treasury and those issued by certain agencies, authorities or instrumen-
talities of the U.S. Government, including the Federal Home Loan Banks, Fed-
eral Farm Credit Banks, Tennessee Valley Authority and the Student Loan Mar-
keting Association.
CUSTODIAL RECEIPTS
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may also acquire securities issued or guaranteed as
to principal and interest by the U.S. Government, its agencies, authorities or
instrumentalities in the form of custodial receipts that evidence ownership of
future interest payments, principal payments or both on certain notes or bonds
issued by the U.S. Government, its agencies, authorities or instrumentalities.
For certain securities law purposes, custodial receipts are not considered ob-
ligations of the U.S. Government.
U.S. AND FOREIGN BANK OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "U.S. Bank Obligations" limited to securities issued or guaranteed by
U.S. banks (including certificates of deposit, commer -
16
<PAGE>
cial paper, unsecured bank promissory notes and bankers' acceptances) which
have more than $1 billion in total assets at the time of purchase. Such obli-
gations may also include debt obligations issued by U.S. subsidiaries of such
banks.
The Money Market and Premium Money Market Funds may also invest in "Foreign
Bank Obligations" limited to U.S. dollar-denominated obligations issued or
guaranteed (including fixed time deposits) by foreign banks which have more
than $1 billion in total assets at the time of purchase, U.S. branches of such
foreign banks (Yankee obligations), foreign branches of such foreign banks and
foreign branches of U.S. banks having more than $1 billion in total assets at
the time of purchase. Such bank obligations may be general obligations of the
parent bank or may be limited to the issuing branch by the terms of the spe-
cific obligations or by government regulation.
The Money Market and Premium Money Market Funds will invest more than 25% of
their total assets in bank obligations (whether foreign or domestic), includ-
ing bank commercial paper. However, if adverse economic conditions prevail in
the banking industry (such as substantial losses on loans, increases in non-
performing assets and charge-offs and declines in total deposits) the Funds
may, for defensive purposes, temporarily invest less than 25% of their total
assets in bank obligations. As a result, the Funds may be especially affected
by favorable and adverse developments in or related to the banking industry.
The activities of U.S. banks and most foreign banks are subject to comprehen-
sive regulations which, in the case of U.S. regulations, have undergone sub-
stantial changes in the past decade. The enactment of new legislation or regu-
lations, as well as changes in interpretation and enforcement of current laws,
may affect the manner of operations and profitability of domestic and foreign
banks. Significant developments in the U.S. banking industry have included de-
regulation of interest rates, increased competition from other types of finan-
cial institutions, increased acquisition activity, geographic expansion and,
during the late 1980's, an increased number of bank failures. Banks may be
particularly susceptible to certain economic factors, such as interest rate
changes and adverse developments in the market for real estate. Fiscal and
monetary policy and general economic cycles can affect the availability and
cost of funds, loan demand and asset quality and thereby impact the earnings
and financial conditions of banks. See "Foreign Government Obligations--For-
eign Risks" below.
COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Commercial Paper" (including variable amount master demand notes and
asset-backed commercial paper) which is payable in U.S. dollars and is issued
or guaranteed by U.S. corporations, U.S. commercial banks, foreign corpora-
tions (Money Market and Premium Money Market Funds only), foreign commercial
banks (Money Market and Premium Money Market Funds only) or other entities. In
addition, the Funds may invest in other short-term obligations (including
short-term funding agreements) payable in U.S. dollars and issued or guaran-
teed by U.S. corporations, foreign corporations (Money Market and Premium
Money Market Funds only) or other entities.
ASSET-BACKED AND RECEIVABLES-BACKED SECURITIES
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Asset-Backed and Receivables-Backed Securities" which represent par-
ticipations in, or are secured by and payable from, pools of assets such as
motor vehicle installment sale contracts, installment loan contracts, leases
of various types of real and personal property, receivables from revolving
credit (credit card) agreements and other categories of receivables. Such as-
set pools are securitized through the use of privately-formed trusts or spe-
cial purpose corporations. Payments or distributions of principal and interest
may be guaranteed up to certain amounts and
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<PAGE>
for a certain time period by a letter of credit or a pool insurance policy is-
sued by a financial institution, or other credit enhancements may be present.
To the extent consistent with its investment objectives and policies, each of
the Prime Obligations, Money Market and Money Market Plus Funds may invest in
new types of mortgage-related securities and in other asset-backed securities
that may be developed in the future.
FOREIGN GOVERNMENT OBLIGATIONS
The Money Market and Premium Money Market Funds may invest in U.S. dollar-
denominated obligations (limited to commercial paper and other notes) issued
or guaranteed by a foreign government or any entity located or organized in a
foreign country that maintains a short-term foreign currency rating in the
highest short-term ratings category by the requisite number of NRSROs. The
Money Market and Premium Money Market Funds may not invest more than 25% of
their total assets in the securities of any one foreign government.
FOREIGN RISKS. Investments in foreign securities and bank obligations may
present a greater degree of risk than investments in securities of domestic
issuers because of less publicly-available financial and other information,
less securities regulation, potential imposition of foreign withholding and
other taxes, war, expropriation or other adverse governmental actions. Foreign
banks and their foreign branches are not regulated by U.S. banking authori-
ties, and generally are not bound by the accounting, auditing and financial
reporting standards applicable to U.S. banks.
MUNICIPAL OBLIGATIONS
MUNICIPAL INSTRUMENTS. Obligations issued by or on behalf of states, terri-
tories and possessions of the United States and their political subdivisions,
agencies, authorities and instrumentalities, and the District of Columbia, the
interest from which is, in the opinion of bond counsel, if any, excluded from
gross income for federal income tax purposes.
TYPES OF MUNICIPAL INSTRUMENTS:
<TABLE>
<CAPTION>
TAX-FREE MONEY MARKET AND
MUNICIPAL MONEY MARKET FUNDS
-------------------------------------------------------------------------
<S> <C>
FIXED RATE NOTES AND SIMILAR In highest short-term or one of the
DEBT INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
VARIABLE AND FLOATING RATE In highest short-term or one of the
DEMAND INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
TAX-EXEMPT COMMERCIAL PAPER In highest rating category
-------------------------------------------------------------------------
MUNICIPAL BONDS In one of the two highest rating
categories
-------------------------------------------------------------------------
UNRATED NOTES, PAPER, BONDS AND Determined to be of comparable quality
OTHER INSTRUMENTS by Adviser pursuant to criteria
approved by the Trustees
</TABLE>
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<PAGE>
As a matter of fundamental policy, at least 80% of each of the Tax-Free
Money Market and Municipal Money Market Fund's net assets will ordinarily be
invested in Municipal Instruments. Each Tax-Exempt Fund may temporarily invest
in taxable money market instruments when the Adviser believes that the market
conditions dictate a defensive posture. Investments in taxable money market
instruments will be limited to those meeting the quality standards of each
Tax-Exempt Fund. The Prime Obligations, Money Market and Premium Money Market
Funds may invest in short-term obligations issued or guaranteed by state and
municipal governments when yields on such securities are attractive compared
to other taxable investments.
MUNICIPAL NOTES AND BONDS. Municipal notes include tax anticipation notes
("TANs"), revenue anticipation notes ("RANs"), bond anticipation notes
("BANs"), tax and revenue anticipation notes ("TRANs") and construction loan
notes. Municipal bonds include general obligation bonds and revenue bonds.
General obligation bonds are backed by the taxing power of the issuing munici-
pality and are considered the safest type of bonds. Revenue bonds are backed
by the revenues of a project or facility such as the tolls from a toll bridge.
Revenue bonds also include lease rental revenue bonds which are issued by a
state or local authority for capital projects and are secured by annual lease
payments from the state or locality sufficient to cover debt service on the
authority's obligations. Industrial development bonds (generally referred to
under current tax law as "private activity bonds") are a specific type of rev-
enue bond backed by the credit and security of a private user and therefore
have more potential risk. Municipal bonds may be issued in a variety of forms,
including commercial paper, tender option bonds and variable and floating rate
securities.
TENDER OPTION BONDS. A tender option bond is a Municipal Instrument (gener-
ally held pursuant to a custodial arrangement) having a relatively long matu-
rity and bearing interest at a fixed rate substantially higher than prevailing
short-term, tax-exempt rates. The bond is typically issued in conjunction with
the agreement of a third party, such as a bank, broker-dealer or other finan-
cial institution, pursuant to which such institution grants the security
holder the option, at periodic intervals, to tender its securities to the in-
stitution and receive the face value thereof. As consideration for providing
the option, the financial institution receives periodic fees equal to the dif-
ference between the bond's fixed coupon rate and the rate, as determined by a
remarketing or similar agent at or near the commencement of such period, that
would cause the securities, coupled with the tender option, to trade at par on
the date of such determination. Thus, after payment of this fee, the security
holder effectively holds a demand obligation that bears interest at the pre-
vailing short-term, tax-exempt rate. However, an institution will not be obli-
gated to accept tendered bonds in the event of certain defaults or a signifi-
cant downgrading in the credit rating assigned to the issuer of the bond. The
tender option will be taken into account in determining the maturity of the
tender option bonds and a Fund's average portfolio maturity. There is a risk
that a Fund will not be considered the owner of a tender option bond for fed-
eral income tax purposes and thus will not be entitled to treat such interest
as exempt from federal income tax.
REVENUE ANTICIPATION WARRANTS. Revenue Anticipation Warrants ("RAWs") are
issued in anticipation of the issuer's receipt of revenues and present the
risk that such revenues will be insufficient to satisfy the issuer's payment
obligations. The entire amount of principal and interest on RAWs is due at ma-
turity. RAWs, including those with a maturity of more than 397 days, may also
be repackaged as instruments which include a demand feature that permits the
holder to sell the RAWs to a bank or other financial institution at a purchase
price equal to par plus accrued interest on each interest rate reset date.
FLOATING AND VARIABLE RATE OBLIGATIONS. The value of floating and variable
rate obligations generally is more stable than that of fixed rate obligations
in response to changes in interest rate levels. Variable and floating rate ob-
ligations usually have demand features that permit the Funds to sell them at
par value plus accrued interest
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<PAGE>
upon short notice. The issuers or financial intermediaries providing demand
features may support their ability to purchase the obligations by obtaining
credit with liquidity supports. These may include lines of credit, which are
conditional commitments to lend and letters of credit, which will ordinarily
be irrevocable, both of which may be issued by domestic banks or foreign banks
which have a branch, agency or subsidiary in the United States. When consider-
ing whether an obligation meets a Fund's quality standards, the Fund will, to
the extent permitted by Rule 2a-7, look to the creditworthiness of the party
providing unconditional demand features or other unconditional obligations to
support the credit of the issuer of the security. A Fund may consider the ma-
turity of a variable or floating rate Municipal Instrument to be shorter than
its ultimate stated maturity if the Fund has the right to demand prepayment of
its principal at specified intervals prior to the security's ultimate stated
maturity, subject to the conditions for using amortized cost valuation under
the Investment Company Act. A Fund may purchase such variable or floating rate
obligations from the issuers or may purchase certificates of participation, a
type of floating or variable rate obligation, which are interests in a pool of
debt obligations held by a bank or other financial institution.
INDUSTRIAL DEVELOPMENT BONDS. The Funds (other than the Treasury Obliga-
tions, Treasury Instruments, Government and Federal Funds) may invest in in-
dustrial development bonds (generally referred to under current tax law as
"private activity bonds"), the interest from which would be an item of tax
preference when distributed as "exempt-interest dividends" to shareholders un-
der the federal alternative minimum tax. See "Taxes" and "Distributions." Mu-
nicipal Fund may invest up to 100% of its assets in private activity bonds.
Tax-Free Fund does not currently intend to invest in such bonds. If Tax-Free
Fund's policy not to invest in private activity bonds should change in the fu-
ture, shareholders would be notified and such investments would not exceed 20%
of Tax-Free Fund's net assets.
OTHER POLICIES. Ordinarily the Tax-Exempt Funds expect that 100% of their
portfolio securities will be Municipal Instruments. However, the Funds may
hold cash or invest in short-term taxable securities as set forth above. Such
Funds may invest 25% or more of the value of their respective total assets in
Municipal Instruments which are related in such a way that an economic, busi-
ness or political development or change affecting one Municipal Instrument
would also affect the other Municipal Instruments. For example, the Tax-Exempt
Funds may invest all of their respective assets in (a) Municipal Instruments
the interest on which is paid solely from revenues from similar projects such
as hospitals, electric utility systems, multi-family housing, nursing homes,
commercial facilities (including hotels), steel companies or life care facili-
ties, (b) Municipal Instruments whose issuers are in the same state or (c) in-
dustrial development obligations. Concentration of a Fund's investments in
these Municipal Instruments will subject the Fund, to a greater extent than if
such investment was more limited, to the risks of adverse economic, business
or political developments affecting any such state, industry or other area of
concentration.
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may purchase Municipal Instruments which are backed
by letters of credit, which will ordinarily be irrevocable, issued by domestic
banks or foreign banks (excluding Prime Obligations Fund) which have a branch,
agency or subsidiary in the United States. In addition, these Funds may ac-
quire securities in the form of custodial receipts which evidence ownership of
future interest payments, principal payments or both on obligations of certain
state and local governments and authorities.
In order to enhance the liquidity, stability, or quality of a Municipal In-
strument, each Fund (other than the Treasury Obligations, Treasury Instru-
ments, Government and Federal Funds) may acquire the right to sell the secu-
rity to another party at a guaranteed price and date.
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<PAGE>
REPURCHASE AGREEMENTS
Each Fund (other than the Treasury Instruments Fund) may only enter into re-
purchase agreements with primary dealers in U.S. Government Securities. A re-
purchase agreement is an agreement under which a Fund purchases securities and
the seller agrees to repurchase the securities within a particular time at a
specified price. Such price will exceed the original purchase price, the dif-
ference being income to the Fund, and will be unrelated to the interest rate
on the purchased security. A Fund's custodian or sub-custodian will maintain
custody of the purchased securities for the duration of the agreement. The
value of the purchased securities, including accrued interest, will at all
times equal or exceed the value of the repurchase agreement. In the event of
bankruptcy of the seller or failure of the seller to repurchase the securities
as agreed, a Fund could suffer losses, including loss of interest on or prin-
cipal of the security and costs associated with delay and enforcement of the
repurchase agreement. In evaluating whether to enter into a repurchase agree-
ment, the Adviser will carefully consider the creditworthiness of the seller
pursuant to procedures reviewed and approved by the Trustees. Distributions of
the income from repurchase agreements entered into by a Fund will be taxable
to its shareholders. In addition, each Fund, together with other registered
investment companies having management agreements with the Adviser or any of
its affiliates, may transfer uninvested cash balances into a single joint ac-
count, the daily aggregate balance of which will be invested in one or more
repurchase agreements.
FORWARD COMMITMENTS AND WHEN-ISSUED SECURITIES
Each Fund may purchase when-issued securities and make contracts to purchase
or sell securities for a fixed price at a future date beyond customary settle-
ment time. A Fund is required to hold and maintain in a segregated account
with the Fund's custodian or sub-custodian until three days prior to settle-
ment date, cash or liquid assets in an amount sufficient to meet the purchase
price. Alternatively, a Fund may enter into offsetting contracts for the for-
ward sale of other securities that it owns. Securities purchased or sold on a
when-issued or forward commitment basis involve a risk of loss if the value of
the security to be purchased declines prior to the settlement date or if the
value of the security to be sold increases prior to the settlement date. Al-
though a Fund would generally purchase securities on a when-issued or forward
commitment basis with the intention of acquiring securities for its portfolio,
the Fund may dispose of a when-issued security or forward commitment prior to
settlement if the Adviser deems it appropriate to do so.
OTHER INVESTMENT COMPANIES
The Adviser will determine, under guidelines established by the Trustees,
whether securities issued by other money market investment companies present
minimal credit risks. The amount of each Fund's investments in securities of
other investment companies will be subject to the limitations on such invest-
ments prescribed by the Investment Company Act. These limits include a prohi-
bition on any Fund acquiring more than 3% of the voting shares of any other
investment company and a prohibition on investing more than 5% of a Fund's to-
tal assets in securities of any one investment company or more than 10% of its
total assets in securities of all investment companies. Each Fund will indi-
rectly bear its proportionate share of any management fees and other expenses
paid by such other investment companies. Such other investment companies will
have investment objectives, policies and restrictions substantially similar to
those of the acquiring Fund and will be subject to substantially the same
risks.
INVESTMENT LIMITATIONS
TAXABLE AND TAX-EXEMPT FUNDS. Each Fund will comply with the conditions for
using amortized cost valuation set forth in Rule 2a-7 under the Investment
Company Act including, but not limited to, those condi-
21
<PAGE>
tions relating to maturity, diversification and credit quality. These operat-
ing policies may be more restrictive than the fundamental policies set forth
in the Statement of Additional Information.
INVESTMENT RESTRICTIONS. Each Fund is subject to certain investment restric-
tions that are described in detail under "Investment Restrictions" in the
Statement of Additional Information. Fundamental investment restrictions of a
Fund cannot be changed without approval of a majority of the outstanding
shares of that Fund. Treasury Obligations Fund's policy of limiting its in-
vestments to U.S. Treasury Obligations and related repurchase agreements is
also fundamental. All investment objectives and policies not specifically des-
ignated as fundamental are non-fundamental and may be changed without share-
holder approval.
RESTRICTED AND OTHER ILLIQUID SECURITIES. Each Fund may purchase securities
that are not registered ("restricted securities") under the Securities Act of
1933 ("1933 Act"), but can be offered and sold to "qualified institutional
buyers" under Rule 144A under the 1933 Act. However, a Fund will not invest
more than 10% of its net assets in illiquid investments, which include fixed
time deposits maturing in more than seven days and restricted securities.
Restricted securities (including commercial paper issued pursuant to Section
4(2) of the 1933 Act) which the Board of Trustees has determined are liquid,
based upon a continuing review of the trading markets for the specific re-
stricted security, will not be deemed to be illiquid investments for purposes
of this restriction. The Board of Trustees may adopt guidelines and delegate
to the Adviser the daily function of determining and monitoring the liquidity
of restricted securities. The Board, however, will retain sufficient oversight
and be ultimately responsible for the determinations. Since it is not possible
to predict with assurance that the market for restricted securities eligible
for resale under Rule 144A will continue to be liquid, the Adviser will care-
fully monitor each Fund's investments in these securities, focusing on such
important factors, among others, as valuation, liquidity and availability of
information. This investment practice could have the effect of increasing the
level of illiquidity in a Fund to the extent that qualified institutional buy-
ers become for a time uninterested in purchasing these restricted securities.
In addition, each Fund may not invest in repurchase agreements maturing in
more than seven days and securities which are not readily marketable if, as a
result thereof, more than 10% of the net assets of that Fund (taken at market
value) would be invested in such investments. Certain repurchase agreements
which mature in more than seven days can be liquidated before the nominal
fixed term on seven days or less notice. Such repurchase agreements will be
regarded as liquid instruments.
MANAGEMENT
THE ADVISER
GSAM, One New York Plaza, New York, New York 10004, a separate operating di-
vision of Goldman, Sachs & Co., acts as investment adviser to the Funds.
Goldman Sachs registered as an investment adviser in 1981. As of July , 1997,
Goldman Sachs, together with its affiliates, acted as investment adviser, ad-
ministrator or distributor for approximately $ billion in assets.
As of November 29, 1996, Goldman Sachs and its consolidated subsidiaries had
assets of approximately $152 billion and partners' capital of $5.3 billion and
ranked as one of the largest international investment banking and brokerage
firms in the United States. Founded in 1869, Goldman Sachs is a major invest-
ment banking and brokerage firm providing a broad range of financing and in-
vestment services both in the United States and abroad.
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<PAGE>
Pursuant to an SEC order, each Taxable and Tax-Advantaged Fund may enter
into principal transactions in certain taxable money market instruments, in-
cluding repurchase agreements, with Goldman Sachs.
Under the Management Agreement, GSAM continually manages each Fund, includ-
ing the purchase, retention and disposition of its securities and other as-
sets. In addition, GSAM administers each Fund's business affairs and performs
various shareholder servicing functions to the extent not provided by other
organizations. The management of each Fund is subject to the supervision of
the Trustees and each Fund's investment policies. For these services, the
Trust, on behalf of each Fund, pays GSAM a monthly fee at an annual rate of
each Fund's average daily net assets as follows:
<TABLE>
<CAPTION>
FISCAL YEAR
ENDED
CONTRACTUAL DECEMBER 31,
RATE 1996
----------- ------------
<S> <C> <C>
Financial Square Prime Obligations Fund................ .205% .17%
Financial Square Money Market Fund..................... .205% .17%
Financial Square Premium Money Market Fund............. .205% N/A*
Financial Square Treasury Obligations Fund............. .205% .17%
Financial Square Treasury Instruments Fund............. .205% N/A*
Financial Square Government Fund....................... .205% .17%
Financial Square Federal Fund.......................... .205% N/A*
Financial Square Tax Free Money Market Fund............ .205% .17%
Financial Square Municipal Money Market Fund........... .205% N/A*
</TABLE>
* As of December 31, 1996, the Premium Money Market Fund, Treasury Instruments
Fund, Federal Fund and Municipal Money Market Fund had not commenced opera-
tions.
A Management Agreement combining both advisory and administrative services
was adopted effective April 30, 1997. The contractual rate set forth in the
table is the rate payable under the Management Agreement and is identical to
the aggregate advisory and administration fees payable by each Fund under the
previously separate investment advisory and administration agreements. For the
fiscal year ended December 31, 1996, the annual rate expressed is the combined
advisory and administration fees paid (after voluntary fee limitations). The
difference, if any, between the stated fees and the actual fees paid by the
Funds reflects the fact that the Investment Adviser did not charge the full
amount of the fees to which it would have been entitled.
GSAM has agreed not to impose a portion of its management fee and/or to re-
duce or otherwise limit the total operating expenses of each Fund (excluding
fees payable to Service Organizations, as defined herein, taxes, interest,
brokerage and litigation, indemnification and other extraordinary expenses).
GSAM has no current intention to but may in the future discontinue or modify
any of such reductions or limitations at its discretion.
THE DISTRIBUTOR AND TRANSFER AGENT
Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606, serves as the Dis-
tributor of shares of each Fund pursuant to a Distribution Agreement with the
Trust. The Distributor will assist in the sale of shares of each Fund upon the
terms described herein. Goldman Sachs also serves as the Transfer Agent of
each Fund.
From time to time, Goldman Sachs or any of its affiliates may purchase and
hold shares of the Funds in order to increase the assets of the Funds. In-
creasing the Fund's assets may enhance investment flexibility and diversifica-
tion. Goldman Sachs reserves the right to redeem at any time some or all of
the Fund shares acquired for its own account. Goldman Sachs will consider the
effect of redemptions on the Funds and other shareholders in deciding whether
to redeem its shares.
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TAXES
Each Fund is treated as a separate entity for federal tax purposes. The
Treasury Instruments and Federal Funds intend to elect and each other Fund has
elected to be treated as a regulated investment company and each Fund intends
to continue to qualify for such treatment under Subchapter M of the Internal
Revenue Code of 1986 (the "Code") for each taxable year. To qualify as such,
each Fund must satisfy certain requirements relating to the sources of its in-
come, diversification of its assets and distribution of its income to share-
holders. As a regulated investment company, each Fund will not be subject to
federal income or excise tax on any net investment income and net realized
capital gains that are distributed to its shareholders in accordance with cer-
tain timing requirements of the Code.
Dividends paid by a Fund from net investment income, the excess of net
short-term capital gain over net long-term capital loss and taxable original
issue discount or market discount income will be taxable to shareholders as
ordinary income, except for any "exempt-interest dividends" paid by the Tax-
Exempt Funds, as described below. Dividends paid by a Fund from the excess of
net long-term capital gain over net short-term capital loss will be taxable as
long-term capital gain regardless of how long the shareholders have held their
shares. These tax consequences will apply to distributions of any Fund
regardless of whether distributions are received in cash or reinvested in
shares. Certain distributions paid by the Funds in January of a given year
will be taxable to shareholders as if received on December 31 of the year in
which they are declared. Shareholders will be informed annually about the
amount and character of distributions received from the Funds for federal
income tax purposes, including any distributions that may constitute a return
of capital or any distributions of Municipal Fund that may constitute a tax
preference item under the federal alternative minimum tax.
The Tax-Exempt Funds intend to satisfy certain requirements of the Code for
the payment of "exempt-interest dividends" not included in shareholders' fed-
eral gross income. Dividends paid by these Funds from interest on tax-exempt
obligations and properly designated by the Funds as exempt-interest dividends,
including dividends attributable to exempt-interest dividends received by a
Fund from other regulated investment companies, will generally be exempt from
federal income tax, although a portion of such dividends may be subject to the
federal alternative minimum tax. Exempt-interest dividends will be considered
in computing the corporate federal alternative minimum tax, and the extent, if
any, to which social security or railroad retirement benefits are taxable.
Persons who are "substantial users" of facilities financed by certain indus-
trial development or private activity bonds should consult their own tax ad-
visers before purchasing shares of these Funds. Interest incurred to purchase
or carry shares of these Funds will not be deductible for federal income tax
purposes to the extent related to exempt-interest dividends paid by the Funds.
Individuals and certain other classes of shareholders may be subject to 31%
backup withholding of federal income tax on taxable distributions if they fail
to furnish their correct taxpayer identification number and certain certifica-
tions required by the Internal Revenue Service or if they are otherwise sub-
ject to backup withholding. Individuals, corporations and other shareholders
that are not U.S. persons under the Code are subject to different tax rules
and may be subject to nonresident alien withholding at the rate of 30% (or a
lower rate provided by an applicable tax treaty) on amounts treated as ordi-
nary dividends from the Funds.
If a Fund invests in foreign securities, it may be subject to foreign with-
holding or other foreign taxes on income earned on such securities and is ex-
pected to be unable to pass such taxes through to shareholders, who therefore
are not expected to include such taxes in income or be entitled to claim for-
eign tax credits or deductions with respect to such taxes.
In addition to federal taxes, a shareholder may be subject to state, local
or foreign taxes on payments received from a Fund. A state income (and possi-
bly local income and/or intangible property) tax exemption is
24
<PAGE>
generally available to the extent a Fund's distributions are derived from in-
terest on (or, in the case of intangible property taxes, the value of its as-
sets is attributable to) certain U.S. Government obligations and/or tax-exempt
municipal obligations issued by or on behalf of the particular state or a po-
litical subdivision thereof, provided in some states that certain thresholds
for holdings of such obligations and/or reporting requirements are satisfied.
Shareholders should consult their own tax advisers concerning these matters.
NET ASSET VALUE
The net asset value of each Fund (other than the Government, Treasury Obli-
gations and Money Market Plus Funds) is determined as of the close of regular
trading on the New York Stock Exchange (normally 4:00 p.m. New York time) on
each Business Day. The net asset value of Government, Treasury Obligations and
Money Market Plus Funds is determined as of 5:00 p.m. New York time on each
Business Day. Net asset value per share for each class of shares of each Fund
is calculated by determining the amount of net assets attributable to each
class of shares and dividing by the number of shares for such class.
On any Business Day, as defined herein, when the Public Securities Associa-
tion ("PSA") recommends that the securities markets close early, the Treasury
Instruments and Federal Funds will cease, and each other Fund reserves the
right to cease, accepting purchase and redemption orders for same Business Day
credit at the time PSA recommends that the securities markets close. On days
any Fund closes early, purchase and redemption orders received after the PSA
recommended closing time will be credited to the next Business Day. In addi-
tion, each Fund reserves the right to advance the time by which purchase and
redemption orders must be received for same Business Day credit as permitted
by the SEC.
Each Fund seeks to maintain a net asset value of $1.00 per share. In this
connection, each Fund values its portfolio securities on the basis of amor-
tized cost. The amortized cost method values a security at its cost on the
date of purchase and thereafter assumes a constant amortization to maturity of
any discount or premium, regardless of the impact of fluctuating interest
rates on the market value of the instrument. For a more complete description
of the amortized cost valuation method and its effect on existing and prospec-
tive shareholders, see the Statement of Additional Information. There can be
no assurance that a Fund will be able at all times to maintain a net asset
value per share of $1.00.
YIELD INFORMATION
From time to time, each Fund may advertise its yield, effective yield and
average annual total return. Average annual total return is determined by com-
puting the average annual percentage change in value of $1,000 invested at the
maximum public offering price for a specified period of at least one year, as-
suming reinvestment of all dividends and distributions at net asset value. The
total return calculation assumes a complete redemption of the investment at
the end of the relevant period. Each Fund may furnish total return calcula-
tions based on a cumulative, average, year-by-year or other basis for various
specified periods by means of quotations, charts, graphs or schedules. The
yield of a Fund refers to the income generated by an investment in that Fund
over a seven-day period (which period will be stated in the advertisement).
This income is then annualized; that is, the amount of income generated by the
investment during that week is assumed to be generated each week over a 52-
week period and is shown as a percentage of the investment. The effective
yield is calculated similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The effective yield will
be slightly higher than the yield because of the compounding effect of this
assumed reinvestment.
The Tax-Exempt Funds and the Federal and Treasury Instruments Funds may each
also quote tax-equivalent yield. Each Fund's tax-equivalent yield is calcu-
lated by determining the rate of return that would have to be
25
<PAGE>
achieved on a fully taxable investment to produce the after-tax equivalent of
the Fund's yield, assuming certain tax brackets for a shareholder.
Investors should note that the investment results of a Fund are based on
historical performance and will fluctuate over time. Any presentation of a
Fund's total return, yield, effective yield or tax-equivalent yield for any
prior period should not be considered a representation of what an investment
may earn or what a Fund's total return, yield, effective yield or tax-equiva-
lent yield may be in any future period. In addition to the above, each Fund
may from time to time advertise its performance relative to certain averages,
performance rankings, indices, other information prepared by recognized mutual
fund statistical services and investments for which reliable performance data
is available.
Total return, yield, effective yield and tax-equivalent yield will be calcu-
lated separately for each class of shares in existence. Because each such
class of shares is subject to different expenses, the total return and net
yield of such classes of a Fund for the same period may differ. See "Organiza-
tion and Shares of the Trust" below.
ORGANIZATION AND SHARES OF THE TRUST
Each Fund is a series of the Goldman Sachs Trust, which was formed under the
laws of the State of Delaware on January 28, 1997. The Funds were formerly se-
ries of Goldman Sachs Money Market Trust, a Massachusetts business trust, and
were reorganized into the Trust as of April 30, 1997. The Trustees have au-
thority under the Trust's Declaration of Trust to create and classify shares
of beneficial interest in separate series, without further action by share-
holders. Additional series may be added in the future. The Trustees also have
authority to classify or reclassify any series or portfolio of shares into one
or more classes. (Institutions that provide services to holders of FST Pre-
ferred Shares, FST Administration Shares or FST Service Shares are referred to
in this Prospectus as "Service Organizations").
When issued, shares are fully paid and nonassessable. In the event of liqui-
dation, shareholders are entitled to share pro rata in the net assets of the
applicable Fund available for distribution to such shareholders. All shares
are freely transferable and have no preemptive, subscription or conversion
rights. Shareholders are entitled to one vote per share, provided that, at the
option of the Trustees, shareholders will be entitled to a number of votes
based upon the net asset values represented by their shares.
Shares of a Fund will be voted seperately by Fund with respect to matters
pertaining to that Fund except for the election of Trustees and ratification
of independent accountants. For example, shareholders of each Fund are re-
quired to approve the adoption of any management agreement relating to that
Fund and any changes in fundamental investment restrictions or policies of
such Fund. Approval by the shareholders of one Fund is effective only as to
that Fund.
As of August 8, 1997, Harris Trust & Savings Bank, 200 W. Monroe St. Fl 12,
Chicago, IL 60606, owned of record 35.04% of the outstanding shares of Trea-
sury Instruments Fund and National City Bank, P.O. Box 5756, Cleveland, OH
44101-0756, owned of record 32.86% of the outstanding shares of Premium Money
Market Fund.
The Trust does not intend to hold annual meetings of shareholders. However,
pursuant to the Trust's By-Laws, the recordholders of at least 10% of the
shares outstanding and entitled to vote at a special meeting may require the
Trust to hold such special meeting of shareholders for any purpose, and
recordholders may, under certain circumstances, as permitted by the Investment
Company Act, communicate with other shareholders in connection with requiring
a special meeting of shareholders. The Trustees will call a special meeting of
shareholders for the purpose of electing Trustees if, at any time, less than a
majority of Trustees holding office at the time were elected by shareholders.
26
<PAGE>
ADMINISTRATION
Each Fund has adopted an Administration Plan with respect to the FST Admin-
istration Shares which authorizes it to compensate certain institutions for
providing account administration services to their customers who are benefi-
cial owners of such Shares (each a "Service Organization"). Each Fund will en-
ter into agreements with Service Organizations which purchase FST Administra-
tion Shares on behalf of their customers ("Service Agreements"). The Service
Agreements will provide for compensation to the Service Organization in an
amount up to .25% (on an annualized basis) of the average daily net asset
value of the FST Administration Shares of that Fund attributable to or held in
the name of the Service Organization for its customers. The services provided
by a Service Organization may include acting, directly or through an agent, as
the sole shareholder of record, maintaining account records for its customers,
and processing orders to purchase, redeem and exchange FST Administration
Shares for its customers.
For the fiscal year ended December 31, 1996, the Trust, on behalf of the
Prime Obligations Fund, Money Market Fund, Treasury Obligations Fund, Govern-
ment Fund and Tax-Free Fund paid Service Organizations fees at the annual rate
of .25% of each Fund's average daily net assets attributable to FST Adminis-
tration Shares. As of December 31, 1996, the Premium Money Market Fund, Trea-
sury Instruments Fund, Federal Fund and Municipal Money Market Fund had not
commenced operations.
Holders of FST Administration Shares of a Fund will bear all expenses and
fees paid to Service Organizations with respect to such Shares as well as any
other expenses which are directly attributable to such Shares.
Service Organizations may charge other fees to their customers who are the
beneficial owners of FST Administration Shares in connection with their cus-
tomer accounts. These fees would be in addition to any amounts received by the
Service Organization under a Service Agreement and may affect an investor's
return with respect to an investment in a Fund.
All inquiries of beneficial owners of FST Administration Shares of the Funds
should be directed to such owners' Service Organization.
PURCHASE OF SHARES
It is expected that all direct purchasers of FST Administration Shares will
be Service Organizations or their nominees, which may purchase FST Administra-
tion Shares of the Funds through Goldman Sachs. Customers of Service Organiza-
tions may invest in such shares only through their Service Organizations.
As set forth below, FST Administration Shares of the Funds may be purchased
on any Business Day at the net asset value next determined after receipt from
the Service Organization of both the purchase order and the purchase amount in
federal funds. Purchase orders may be made by telephoning Goldman Sachs at
800-621-2550 or by a written request addressed to Goldman Sachs, Attention:
Shareholder Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois
60606. It is strongly recommended that payment be effected by wiring federal
funds to The Northern Trust Company ("Northern"), Chicago, Illinois, as the
sub-custodian for State Street Bank and Trust Company ("State Street").
Purchases of FST Administration Shares may also be made by a Service Organi-
zation by delivering a Federal Reserve draft or check (except that a third
party check will not be accepted) payable only to the appropriate Fund and
drawn on a U.S. bank to Goldman Sachs, Attention: Shareholder Services,
Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606. It is expected
that Federal Reserve drafts will ordinarily be converted to federal funds on
the day of receipt and that checks will be converted to federal funds within
two Business Days after receipt. FST Administration Shares purchased by check
may not be redeemed until the check has cleared, as described under "Redemp-
tion of Shares."
27
<PAGE>
Purchases of shares of any Fund may also be made through an Automated Clear-
ing House ("ACH") transfer to Goldman Sachs Trust c/o Northern, as
subcustodian for State Street. Purchase orders are effected at the net asset
value next determined after receipt of both the purchase order and the pur-
chase amount in federal funds. It is expected that ACH transfers will ordinar-
ily be converted to federal funds on the Business Day following receipt of the
ACH transfer.
FST Administration Shares of each Fund are deemed to have been purchased
when an order becomes effective and are entitled to dividends on FST Adminis-
tration Shares purchased as follows:
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
IF ORDER IS RECEIVED FROM A SERVICE
ORGANIZATION BY GOLDMAN SACHS DIVIDENDS BEGIN
----------------------------------- ---------------
<C> <S> <C>
(1) Taxable and Tax-Advantaged Funds
(except Government, Treasury Obligations
and Premium Money Market Funds)
By: 3:00 p.m.--N.Y. time Same Business Day
- ------------------------------------------------------------------------
After: 3:00 p.m.--N.Y. time Next Business Day
- ------------------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By: 5:00 p.m.--N.Y. time Same Business Day
- ------------------------------------------------------------------------
After: 5:00 p.m.--N.Y. time Next Business Day
- ------------------------------------------------------------------------
(3) Municipal Fund
By: 1:00 p.m.--N.Y. time Same Business Day
- ------------------------------------------------------------------------
After: 1:00 p.m.--N.Y. time Next Business Day
- ------------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By: 2:00 p.m.--N.Y. time Same Business Day
- ------------------------------------------------------------------------
After: 2:00 p.m.--N.Y. time Next Business Day
- ------------------------------------------------------------------------
</TABLE>
The Service Organizations are responsible for timely transmittal of pur-
chase orders to Goldman Sachs and federal funds to Northern. In order to fa-
cilitate timely transmittal, the Service Organizations have established times
by which purchase orders and federal funds must be received by them.
A Business Day means any day on which the New York Stock Exchange is open,
except for days on which Chicago, Boston or New York banks are closed for lo-
cal holidays.
FST Administration Shares of a Fund are purchased at the net asset value per
share without the imposition of a sales charge. Goldman Sachs, as each Fund's
transfer agent, will maintain a complete record of transactions and FST Admin-
istration Shares held in each record holder's account. The Trust and Goldman
Sachs each reserves the right to reject any purchase order for any reason.
28
<PAGE>
MINIMUM INVESTMENT AND OTHER INFORMATION
The minimum initial investment requirement is $10 million, which may be al-
located among the Funds. The Trust and Goldman Sachs each reserves the right
to waive the minimum investment requirement. A Service Organization may impose
a minimum amount for initial and subsequent investments in FST Administration
Shares of the Funds, and may establish other requirements such as a minimum
account balance. A Service Organization may effect redemptions of noncomplying
accounts, and may impose a charge for any special services rendered to its
customers. Customers should contact their Service Organizations for further
information concerning such requirements and charges. A Service Organization
may purchase FST Administration Shares in connection with sweep account pro-
grams.
SUBSEQUENT INVESTMENTS
There is no minimum amount required for subsequent investments. Orders for
the purchase of additional FST Administration Shares should be accompanied by
information identifying the account and the Fund in which FST Administration
Shares are to be purchased.
REPORTS TO SHAREHOLDERS
The Trust will issue an annual report containing audited financial state-
ments and a semi-annual report to record holders of FST Administration Shares
of each Fund, including Service Organizations who hold such Shares for the
benefit of their customers. Upon request, a printed confirmation for each
transaction will be provided by Goldman Sachs. Any dividends and distributions
paid by the Funds are also reflected in regular statements issued by Goldman
Sachs to shareholders of record. Service Organizations will be responsible for
providing similar services to their own customers who are the beneficial own-
ers of such Shares.
DISTRIBUTIONS
All or substantially all of each Fund's net investment income will be de-
clared daily (as of 4:00 p.m. New York time for each Fund other than the Gov-
ernment, Treasury Obligations and Premium Money Market Funds and as of 5:00
p.m. New York time for the Government, Treasury Obligations and Premium Money
Market Funds) as a dividend and distributed to Service Organizations monthly.
Distributions will be made in additional FST Administration Shares of the same
Fund or, at the election of a Service Organization, in cash. The election to
reinvest dividends and distributions or receive them in cash may be changed by
a Service Organization at any time upon written notice to Goldman Sachs. If no
election is made, all dividends and capital gain distributions will be rein-
vested. Dividends will be reinvested as of the last calendar day of each
month. Cash distributions will be paid on or about the first business day of
each month. Net short-term capital gains, if any, will be distributed in ac-
cordance with the requirements of the Code and may be reflected in the Fund's
daily distributions. Each Fund may distribute at least annually its long-term
capital gains, if any, after reduction by available capital losses. In order
to avoid excessive fluctuations in the amount of monthly capital gains distri-
butions, a portion of any net capital gains realized on the disposition of se-
curities during the months of November and December may be distributed during
the subsequent calendar year. Although realized gains and losses on the assets
of a Fund are reflected in the net asset value of the Fund, they are not ex-
pected to be of an amount which would affect the Fund's net asset value of
$1.00 per share.
The income declared as a dividend for the Treasury Obligations, Government
and Premium Money Market Funds is based on estimates of net investment income
for each Fund. Actual income may differ from estimates, and differences, if
any, will be included in the calculation of subsequent dividends.
29
<PAGE>
A Fund's net investment income consists of the excess of (i) accrued inter-
est or discount (including both original issue and market discount on taxable
securities) on portfolio securities, and (ii) any income of the Fund from
sources other than capital gains over (iii) the amortization of market premium
on all portfolio securities and (iv) the estimated expenses of the Fund, in-
cluding a proportionate share of the general expenses of the Trust.
EXCHANGES
FST Administration Shares of each Fund may be exchanged by Service Organiza-
tions for shares of the corresponding class of any Fund or Portfolio of
Goldman Sachs Trust at the net asset value next determined either by writing
to Goldman Sachs, Attention: Shareholder Services, Goldman Sachs Trust, 4900
Sears Tower, Chicago, Illinois 60606 or, if previously elected in the Account
Information Form, by calling Goldman Sachs at 800-621-2550. All telephone ex-
changes must be registered in the same name(s) and with the same address as
are registered in the Fund from which the exchange is being made. It may be
difficult to implement the telephone exchange privilege in times of drastic
economic or market changes. In an effort to prevent unauthorized or fraudulent
exchange requests by telephone, Goldman Sachs employs reasonable procedures as
set forth under "Redemption of Shares" to confirm that such instructions are
genuine. Exchanges are available only in states where the exchange may legally
be made. The exchange privilege may be modified or withdrawn at any time on 60
days' written notice.
REDEMPTION OF SHARES
HOW TO REDEEM
Customers of Service Organizations may redeem FST Administration Shares of a
Fund through their respective Service Organizations. The Service Organizations
are responsible for the transmittal of redemption requests by their customers
to Goldman Sachs. In order to facilitate timely transmittal of redemption re-
quests, Service Organizations have established procedures by which redemption
requests must be made and times by which redemption requests must be received
by them. Additional documentation may be required when deemed appropriate by a
Service Organization.
A Service Organization may redeem such Shares without charge upon request on
any Business Day at the net asset value next determined after receipt by
Goldman Sachs of the redemption request. Redemption requests may be made by
telephoning Goldman Sachs at 800-621-2550 or by a written request addressed to
Goldman Sachs, Attention: Shareholder Services, Goldman Sachs Trust, 4900
Sears Tower, Chicago, Illinois 60606. A Service Organization may request re-
demptions by telephone only if the optional telephone redemption privilege has
been elected on the Account Information Form. It may be difficult to implement
redemptions by telephone in times of drastic economic or market changes.
In an effort to prevent unauthorized or fraudulent redemption requests by
telephone, Goldman Sachs employs reasonable procedures specified by the Trust
to confirm that such instructions are genuine. Among other things, any redemp-
tion request that requires money to go to an account or address other than
that designated on the Account Information Form must be in writing and signed
by an authorized person designated on the Account Information Form. Any such
written request is also confirmed by telephone with both the requesting party
and the designated bank account to verify instructions. Other procedures may
be implemented from time to time. If reasonable procedures are not implement-
ed, the Trust may be liable for any loss due to unauthorized or fraudulent
transactions. In all other cases, neither the Trust nor Goldman Sachs will be
responsible for the authenticity of redemption instructions received by tele-
phone. A redemption may also be made with respect to certain Funds by means of
the check redemption privilege described in the Statement of Additional Infor-
mation. Goldman Sachs reserves the right to redeem accounts with balances be-
low $500.
30
<PAGE>
Additional documentation may be required by Goldman Sachs in order to estab-
lish that a redemption request has been properly authorized. A redemption re-
quest will not be considered to have been received in proper form until such
additional documentation has been submitted to Goldman Sachs by the Service
Organization. The payment of redemption proceeds for FST Administration Shares
recently purchased by check will be delayed for up to 15 days until the check
has cleared.
PAYMENT OF REDEMPTION PROCEEDS AND DIVIDENDS
In accordance with the following, redemption proceeds will be wired to the
record holder of FST Administration Shares.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
REDEMPTION REQUEST
RECEIVED FROM REDEMPTION
SERVICE ORGANIZATION PROCEEDS
BY GOLDMAN SACHS ORDINARILY DIVIDENDS
-------------------- ---------- ---------
<C> <S> <C>
(1) Taxable and Tax-Advantaged Funds (except Government,
Treasury Obligations and Premium Money Market Funds)
By:3:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- -----------------------------------------------------------------------------
After:3:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- -----------------------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By:5:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- -----------------------------------------------------------------------------
After:5:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- -----------------------------------------------------------------------------
(3) Municipal Fund
By:12:00 noon--N.Y. time Wired Same Business Day Not earned on Day
request is received
- -----------------------------------------------------------------------------
After:12:00 noon--N.Y. time Wired Next Business Day Earned on Day
request is received
- -----------------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By:1:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- -----------------------------------------------------------------------------
After:1:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- -----------------------------------------------------------------------------
</TABLE>
The Funds will arrange for the proceeds of redemptions effected by any means
to be wired as federal funds to the Service Organization's bank account desig-
nated in the Account Information Form. Redemption proceeds
31
<PAGE>
will normally be wired as set forth above, but may be paid up to three Busi-
ness Days after receipt of the Service Organization's properly executed re-
demption request. For example, payment may be delayed if the Federal Reserve
Bank is closed on the day redemption proceeds would ordinarily be wired. After
a wire has been initiated by Goldman Sachs, neither Goldman Sachs nor the
Trust assumes any further responsibility for the performance of intermediaries
or the FST Administration Shareholder's Service Organization in the transfer
process. If a problem with such performance arises, the FST Administration
Shareholder should deal directly with such intermediaries or Service
Organization.
OTHER REDEMPTION INFORMATION
A minimum account balance of $10 million is required to remain a FST
Administration Shareholder. The Trust and Goldman Sachs each reserves the
right to waive the minimum account balance. The Trust also reserves the right
to redeem shares of a shareholder account if the balance is less than the
minimum described above. The Trust will give sixty (60) days' prior written
notice to such Shareholders whose FST Administration Shares are to be redeemed
to allow them to purchase sufficient additional FST Administration Shares to
avoid such redemption.
----------------
32
<PAGE>
APPENDIX
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON ACCOUNT INFORMATION FORM
You are required by law to provide the Fund with your correct Social Secu-
rity or other Taxpayer Identification Number (TIN), regardless of whether you
file tax returns. Failure to do so may subject you to penalties. Failure to
provide your correct TIN and to sign your name in the certification section of
the Account Information Form could result in withholding of 31% by the Fund
for the federal backup withholding tax on distributions, redemptions, ex-
changes and other payments relating to your account.
Any tax withheld may be credited against taxes owed on your federal income
tax return.
If you do not have a TIN, you should apply for one immediately by contacting
your local office of the Social Security Administration or the Internal Reve-
nue Service (IRS). Backup withholding could apply to payments relating to your
account prior to the Fund's receipt of your TIN.
Special rules apply for certain entities. For example, for an account estab-
lished under a Uniform Gifts or Transfers to Minors Act, the TIN of the minor
should be furnished.
If you have been notified by the IRS that you are subject to backup with-
holding because you failed to report all your interest and/or dividend income
on your tax return and you have not been notified by the IRS that such with-
holding should cease, you must cross out item (2) in the certification section
of the Account Information Form.
If you are an exempt recipient, you should furnish your TIN and certify your
exemption by signing the Certification section and writing "exempt" after your
signature. Exempt recipients include: corporations, tax-exempt pension plans
and IRA's, governmental agencies, financial institutions, registered securi-
ties and commodities dealers and others.
If you are a nonresident alien or foreign entity, you must provide a com-
pleted Form W-8 to the Fund in order to avoid backup withholding on certain
payments. Other payments to you may be subject to non-resident alien withhold-
ing of up to 30%.
For further information regarding backup and nonresident alien withholding,
see Sections 3406, 1441 and 1442 of the Internal Revenue Code and consult your
tax adviser.
A-1
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FST ADMINISTRATION SHARES
4900 SEARS TOWER
CHICAGO, ILLINOIS 60606
TOLL FREE: 800-621-2550
-----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Shareholder and Fund Expenses.............................................. 2
Financial Highlights....................................................... 4
An Introduction to the Funds............................................... 12
Investment Policies Matrix................................................. 14
Description of Securities and Investment Techniques........................ 16
Investment Limitations..................................................... 21
Management................................................................. 22
Taxes...................................................................... 23
Net Asset Value............................................................ 25
Yield Information.......................................................... 25
Organization and Shares of the Trust....................................... 26
Administration............................................................. 27
Purchase of Shares......................................................... 27
Reports to Shareholders.................................................... 29
Distributions.............................................................. 29
Exchanges.................................................................. 30
Redemption of Shares....................................................... 30
Appendix................................................................... A-1
</TABLE>
FSPROADMM
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST ADMINISTRATION SHARES
-----------
PROSPECTUS
-----------
MANAGED BY
GOLDMAN SACHS ASSET MANAGEMENT
A SEPARATE OPERATING DIVISION OF
GOLDMAN, SACHS & CO.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST SERVICE SHARES
4900 Sears Tower
Chicago, Illinois 60606
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management invest-
ment company (a "mutual fund") which includes the Financial Square Funds (the
"Funds"). This Prospectus relates only to the offering of FST Service shares
of beneficial interest ("FST Service Shares") of the Funds. Goldman Sachs As-
set Management, a separate operating division of Goldman, Sachs & Co., serves
as each Fund's investment adviser. Goldman, Sachs & Co. serves as each Fund's
distributor and transfer agent.
The following Funds seek to maximize current income to the extent consistent
with the preservation of capital and the maintenance of liquidity by investing
exclusively in high quality money market instruments. The Funds may invest in
diversified portfolios of the following types of instruments:
Financial Square Prime Obligations Fund. Securities of the U.S. Government,
its agencies, authorities and instrumentalities, obligations of U.S. banks,
commercial paper and other short-term obligations of U.S. companies, states,
municipalities and other entities, and repurchase agreements.
Financial Square Money Market Fund. Securities of the U.S. Government, its
agencies, authorities and instrumentalities, U.S. dollar denominated obliga-
tions of U.S. and foreign banks, U.S. dollar denominated commercial paper and
other short-term obligations of U.S. and foreign companies, foreign govern-
ments, states, municipalities and other entities, and repurchase agreements.
Financial Square Premium Money Market Fund. Securities of the U.S. Govern-
ment, its agencies, authorities and instrumentalities, U.S. dollar denominated
obligations of U.S. and foreign banks, U.S. dollar denominated commercial pa-
per and other short-term obligations of U.S. and foreign companies, foreign
governments, states, municipalities and other entities, and repurchase agree-
ments. In order to obtain a rating from a rating organization, the Fund will
observe special investment restrictions.
Financial Square Treasury Obligations Fund. Securities issued or guaranteed
by the U.S. Treasury and repurchase agreements relating to such securities.
Financial Square Treasury Instruments Fund. Securities issued or guaranteed
by the U.S. Treasury, the interest income from which is generally exempt from
state income taxation.
Financial Square Government Fund. Securities of the U.S. Government, its
agencies, authorities, and instrumentalities, and repurchase agreements relat-
ing to such securities.
Financial Square Federal Fund. Securities of the U.S. Government and certain
of its agencies, authorities and instrumentalities, the interest income from
which is generally exempt from state income taxation.
Financial Square Tax-Free Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes and
not an item of tax preference under the federal alternative minimum tax.
Financial Square Municipal Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes (but
not necessarily exempt from federal alternative minimum tax or state and local
taxes).
AN INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOV-
ERNMENT AND THERE CAN BE NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- -------------------------------------------------------------------------------
ADDITIONAL INFORMATION............ Goldman Sachs Funds--Toll Free: 800-621-2550
This Prospectus provides you with information about the Funds that you should
know before investing in FST Service Shares. It should be read and retained
for future reference. If you would like more detailed information, the State-
ment of Additional Information dated September 5, 1997, as amended or supple-
mented from time to time, is available upon request without charge from Serv-
ice Organizations, as defined herein, or by calling the telephone number
listed above or by writing Goldman Sachs, Attention: Shareholder Services,
Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606. The Statement
of Additional Information, which is incorporated by reference into this Pro-
spectus, has been filed with the Securities and Exchange Commission. Not all
Funds are available in certain states. Please call the phone number listed
above to determine availability in your state. The SEC maintains a Web site
(http://www.sec.gov) that contains the Statement of Additional Information and
other information regarding the Trust.
- -------------------------------------------------------------------------------
FST SERVICE SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARAN-
TEED OR ENDORSED BY, ANY BANK OR OTHER INSURED DEPOSITORY INSTITUTION, AND ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE
BOARD OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN A FUND INVOLVES INVEST-
MENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is September 5, 1997.
<PAGE>
SHAREHOLDER AND FUND EXPENSES
FST SERVICE SHARES
<TABLE>
<CAPTION>
FINANCIAL FINANCIAL FINANCIAL
FINANCIAL FINANCIAL SQUARE FINANCIAL FINANCIAL SQUARE SQUARE
SQUARE SQUARE PREMIUM SQUARE SQUARE FINANCIAL FINANCIAL TAX-FREE MUNICIPAL
PRIME MONEY MONEY TREASURY TREASURY SQUARE SQUARE MONEY MONEY
OBLIGATIONS MARKET MARKET OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MARKET MARKET
FUND FUND FUND FUND FUND FUND FUND FUND FUND
----------- --------- --------- ----------- ----------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge
Imposed on
Purchases........... None None None None None None None None None
Sales Charge Imposed
on Reinvested
Distributions....... None None None None None None None None None
Deferred Sales Load
Imposed
on Redemptions...... None None None None None None None None None
Exchange Fee......... None None None None None None None None None
ANNUAL OPERATING EXPENSES (1)
(as a percentage of average
daily net assets)
Management Fees
(after limitations)
(2) ................ 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17%
Other Expenses
Service Fees........ 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50%
Other Expenses
(after
expense
limitations) (3)... 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01%
---- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL OPERATING EXPENSES (4). 0.68% 0.68% 0.68% 0.68% 0.68% 0.68% 0.68% 0.68% 0.68%
==== ==== ==== ==== ==== ==== ==== ==== ====
</TABLE>
EXAMPLE OF EXPENSES
You would pay the following expenses on a hypothetical $1,000 investment,
assuming a 5% annual return and redemption at the end of each time period:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Financial Square Prime Obligations Fund... $ 7 $22 $38 $85
Financial Square Money Market Fund........ $ 7 $22 $38 $85
Financial Square Premium Money Market
Fund..................................... $ 7 $22 N/A N/A
Financial Square Treasury Obligations
Fund..................................... $ 7 $22 $38 $85
Financial Square Treasury Instruments
Fund..................................... $ 7 $22 N/A N/A
Financial Square Government Fund.......... $ 7 $22 $38 $85
Financial Square Federal Fund............. $ 7 $22 N/A N/A
Financial Square Tax-Free Money Market
Fund..................................... $ 7 $22 $38 $85
Financial Square Municipal Money Market
Fund..................................... $ 7 $22 N/A N/A
</TABLE>
2
<PAGE>
- --------
(1) Based on estimated amounts for the current fiscal year for the Financial
Square Premium Money Market, Financial Square Treasury Instruments, Finan-
cial Square Federal and Financial Square Municipal Money Market Funds.
(2) The Investment Adviser has voluntarily agreed not to impose 0.035% of its
management fee for each Fund. Without such limitation, management fees for
each Fund would be 0.205%.
(3) The Investment Adviser has voluntarily agreed to reduce or limit certain
other expenses (excluding management fees, fees payable to Service Organi-
zations, as defined herein, taxes, interest and brokerage and litigation,
indemnification and other extraordinary expenses) to the extent such ex-
penses exceed 0.01% of a Fund's average daily net assets.
(4) Without the limitations described above, "Other Expenses" and "Total Oper-
ating Expenses" of the Financial Square Prime Obligations, Financial
Square Money Market, Financial Square Treasury Obligations, Financial
Square Government and Financial Square Tax-Free Money Market Funds for the
semi annual period ended June 30, 1997, would have been as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Prime Obligations Fund................... .025% .73%
Financial Square Money Market Fund........................ .025% .73%
Financial Square Treasury Obligations Fund................ .035% .74%
Financial Square Government Fund.......................... .015% .72%
Financial Square Tax-Free Money Market Fund............... .015% .72%
</TABLE>
In addition, without the limitations described above, "Other Expenses" and
"Total Operating Expenses" of the Financial Square Premium Money Market, Fi-
nancial Square Treasury Instruments, Financial Square Federal and Financial
Square Municipal Money Market Funds for the current fiscal year are estimated
to be as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Premium Money Market Fund................ .035% .74%
Financial Square Treasury Instruments Fund................ .155% .86%
Financial Square Federal Fund............................. .155% .86%
Financial Square Municipal Money Market Fund.............. .285% .99%
</TABLE>
The information set forth in the foregoing table and hypothetical example
relates only to FST Service Shares of the Funds. The Funds also offer FST
Shares, FST Preferred Shares and FST Administration Shares. The other classes
of the Funds are subject to different fees and expenses (which affect perfor-
mance) and are entitled to different services. Information regarding any other
class of the Funds may be obtained from your sales representative or from
Goldman Sachs by calling the number on the front cover of this Prospectus.
Service Organizations may charge other fees to their customers who are the
beneficial owners of FST Service Shares in connection with their customers'
accounts. See "Additional Services." Such fees, if any, may affect the return
such customers realize with respect to their investments.
The purpose of the foregoing table is to assist investors in understanding
the various fees and expenses of a Fund that an investor will bear directly or
indirectly. The information on fees and expenses included in the table and the
hypothetical example above are based on each Fund's fees and expenses (actual
or estimated) and should not be considered as representative of past or future
expenses. Actual fees and expenses may be greater or less than those indicat-
ed. Moreover, while the example assumes a 5% annual return, a Fund's actual
performance will vary and may result in an actual return greater or less than
5%. See "Management--Investment Adviser."
3
<PAGE>
FINANCIAL HIGHLIGHTS
The following data with respect to a share (of the class specified) of the
Financial Square Prime Obligations, Financial Square Money Market, Financial
Square Treasury Obligations, Financial Square Government and Financial Square
Tax-Free Money Market Funds outstanding during the periods ended on or prior
to December 31, 1996 have been audited by Arthur Andersen LLP, independent
public accountants, whose report, which appears in the annual report to share-
holders of the Funds for the fiscal year ended December 31, 1996 (the "Annual
Report") is incorporated by reference into and attached to the Statement of
Additional Information. The following data for each of the above referenced
funds along with the Financial Square Treasury Instruments and Financial
Square Federal Funds for the period ended June 30, 1997 is unaudited, and de-
rived from financial statements included in the semi-annual report to share-
holders of the Fund for the period ended June 30, 1997, (the "Semi-Annual Re-
port"). The Annual Report and the Semi-Annual Report should be read in con-
junction with the financial statements and related notes incorporated by ref-
erence and attached to the Statement of Additional Information.
Financial Square Municipal Money Market and Financial Square Premium Money
Market Funds had no operations during the periods shown. Accordingly, there
are no selected per share data and ratios presented for these Funds.
4
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding Throughout Each Period
Prime Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET EXPENSES TO INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT AVERAGE INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0267 $ -- $0.0267 $(0.0267) $1.00 5.53%(b) 0.18%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0262 -- 0.0262 (0.0262) 1.00 5.42(b) 0.28(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0255 -- 0.0255 (0.0255) 1.00 5.27(b) 0.43(b) 5.15(b)
1997-FST Service
shares.......... 1.00 0.0243 -- 0.0243 (0.0243) 1.00 5.00(b) 0.68(b) 4.90(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0529 -- 0.0529 (0.0529) 1.00 5.41 0.18 5.29
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0346 -- 0.0346 (0.0346) 1.00 5.28(b) 0.28(b) 5.19(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0506 -- 0.0506 (0.0506) 1.00 5.14 0.43 5.06
1996-FST Service
shares.......... 1.00 0.0478 -- 0.0478 (0.0478) 1.00 4.88 0.68 4.78
1995-FST shares. 1.00 0.0586 -- 0.0586 (0.0586) 1.00 6.02 0.18 5.86
1995-FST Admin-
istration
shares.......... 1.00 0.0559 -- 0.0559 (0.0559) 1.00 5.75 0.43 5.59
1995-FST Service
shares.......... 1.00 0.0533 -- 0.0533 (0.0533) 1.00 5.49 0.68 5.33
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0401 -- 0.0401 (0.0401) 1.00 4.38(b) 0.18(b) 4.38(b)
1994-FST Admin-
istration
shares(d)....... 1.00 0.0383 -- 0.0383 (0.0383) 1.00 4.12(b) 0.43(b) 4.18(b)
1994-FST Service
shares(d)....... 1.00 0.0364 -- 0.0364 (0.0364) 1.00 3.86(b) 0.68(b) 3.98(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0311 0.0002 0.0313 (0.0313) 1.00 3.18 0.17 3.11
1994-FST Admin-
istration
shares.......... 1.00 0.0286 0.0002 0.0288 (0.0288) 1.00 2.92 0.42 2.86
1994-FST Service
shares.......... 1.00 0.0261 0.0002 0.0263 (0.0263) 1.00 2.66 0.67 2.61
1993-FST shares. 1.00 0.0360 0.0007 0.0367 (0.0367) 1.00 3.75 0.18 3.60
1993-FST Admin-
istration
shares(e)....... 1.00 0.0068 0.0001 0.0069 (0.0069) 1.00 3.02(b) 0.44(b) 2.96(b)
1993-FST Service
shares.......... 1.00 0.0301 0.0007 0.0308 (0.0308) 1.00 3.23 0.68 3.01
1992-FST shares. 1.00 0.0572 0.0002 0.0574 (0.0574) 1.00 5.99 0.18 5.72
1992-FST Service
shares(e)....... 1.00 0.0027 -- 0.0027 (0.0027) 1.00 4.10(b) 0.66(b) 4.10(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0727 -- 0.0727 (0.0727) 1.00 8.27(b) 0.18(b) 8.04(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $3,813,081 0.23%(b) 5.34%(b)
1997-FST Pre-
ferred Shares... 240,047 0.33(b) 5.26(b)
1997-FST Admin-
istration
shares.......... 295,977 0.48(b) 5.10(b)
1997-FST Service
shares.......... 121,165 0.73(b) 4.85(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 3,901,797 0.23 5.24
1996-FST Pre-
ferred
shares(c)....... 127,126 0.33(b) 5.14(b)
1996-FST Admin-
istration
shares.......... 215,898 0.48 5.01
1996-FST Service
shares.......... 115,154 0.73 4.73
1995-FST shares. 3,295,791 0.22 5.82
1995-FST Admin-
istration
shares.......... 147,894 0.47 5.55
1995-FST Service
shares.......... 65,278 0.72 5.29
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 2,774,849 0.24(b) 4.32(b)
1994-FST Admin-
istration
shares(d)....... 66,113 0.49(b) 4.12(b)
1994-FST Service
shares(d)....... 41,372 0.74(b) 3.92(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1,831,413 0.25 3.03
1994-FST Admin-
istration
shares.......... 35,250 0.50 2.78
1994-FST Service
shares.......... 14,001 0.75 2.53
1993-FST shares. 813,126 0.25 3.53
1993-FST Admin-
istration
shares(e)....... 1,124 0.52(b) 2.88(b)
1993-FST Service
shares.......... 336 0.75 2.94
1992-FST shares. 917,073 0.27 5.63
1992-FST Service
shares(e)....... 118 0.74(b) 4.02(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 578,495 0.28(b) 7.94(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
(e) FST Administration share and FST Service share activity commenced during
November of 1992 and January of 1992, respectively.
(f) Commencement of operations.
5
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $1.00 $0.0269 $ -- $0.0269 $(0.0269) $1.00 5.57%(b) 0.18%(b) 5.44%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0264 -- 0.0264 (0.0264) 1.00 5.46(b) 0.28(b) 5.36(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0257 -- 0.0257 (0.0257) 1.00 5.30(b) 0.43(b) 5.18(b)
1997-FST Service
shares.......... 1.00 0.0244 -- 0.0244 (0.0244) 1.00 5.04(b) 0.68(b) 4.93(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 1.00 0.0533 0.0001 0.0534 (0.0534) 1.00 5.45 0.18 5.33
1996-FST
Preferred
shares(c)....... 1.00 0.0348 -- 0.0348 (0.0348) 1.00 5.31(b) 0.28(b) 5.23(b)
1996-FST
Administration
shares.......... 1.00 0.0504 0.0001 0.0505 (0.0505) 1.00 5.19 0.43 5.04
1996-FST Service
shares.......... 1.00 0.0484 -- 0.0484 (0.0484) 1.00 4.93 0.68 4.84
1995-FST shares. 1.00 0.0589 -- 0.0589 (0.0589) 1.00 6.07 0.15 5.89
1995-FST
Administration
shares.......... 1.00 0.0561 -- 0.0561 (0.0561) 1.00 5.80 0.40 5.61
1995-FST Service
shares(d)....... 1.00 0.0231 -- 0.0231 (0.0231) 1.00 5.41(b) 0.65(b) 4.93(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 1.00 0.0305 -- 0.0305 (0.0305) 1.00 4.91(b) 0.11(b) 4.88(b)
1994-FST
Administration
shares(d)....... 1.00 0.0298 -- 0.0298 (0.0298) 1.00 4.65(b) 0.36(b) 4.82(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $3,992,002 0.23%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 43,759 0.33(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 276,152 0.48(b) 5.13(b)
1997-FST Service
shares.......... 290,345 0.73(b) 4.88(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 2,540,366 0.23 5.28
1996-FST
Preferred
shares(c)....... 17,510 0.33(b) 5.18(b)
1996-FST
Administration
shares.......... 165,766 0.48 4.99
1996-FST Service
shares.......... 234,376 0.73 4.79
1995-FST shares. 2,069,197 0.23 5.81
1995-FST
Administration
shares.......... 137,412 0.48 5.53
1995-FST Service
shares(d)....... 4,219 0.73(b) 4.85(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 862,971 0.25(b) 4.74(b)
1994-FST
Administration
shares(d)....... 66,560 0.50(b) 4.68(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST, FST Administration and FST Service share activity commenced May 18,
1994, May 20, 1994 and July 14, 1995, respectively.
6
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL RATIO OF NET INVESTMENT
VALUE AT NET GAIN (LOSS) INCOME FROM DISTRIBUTIONS NET ASSET EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS END OF PERIOD RETURN(A) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0262 $0.0001 $0.0263 $(0.0263) $1.00 5.43%(b) 0.18%(b) 5.28%(b)
1997-FST Pre-
ferred shares .. 1.00 0.0257 0.0001 0.0258 (0.0258) 1.00 5.32(b) 0.28(b) 5.18(b)
1997-FST Admin-
istration shares
................. 1.00 0.0249 0.0001 0.0250 (0.0250) 1.00 5.16(b) 0.43(b) 5.03(b)
1997-FST Service
shares ......... 1.00 0.0237 0.0001 0.0238 (0.0238) 1.00 4.90(b) 0.68(b) 4.78(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0522 0.0003 0.0525 (0.0524) 1.00 5.35 0.18 5.22
1996-FST
Preferred
shares(c)....... 1.00 0.0342 0.0001 0.0343 (0.0343) 1.00 5.24(b) 0.28(b) 5.11(b)
1996-FST
Administration
shares.......... 1.00 0.0497 0.0002 0.0499 (0.0498) 1.00 5.09 0.43 4.97
1996-FST Service
shares.......... 1.00 0.0472 0.0002 0.0474 (0.0474) 1.00 4.83 0.68 4.72
1995-FST shares. 1.00 0.0573 0.0005 0.0578 (0.0578) 1.00 5.96 0.18 5.73
1995-FST
Administration
shares.......... 1.00 0.0547 0.0005 0.0552 (0.0552) 1.00 5.69 0.43 5.47
1995-FST Service
shares.......... 1.00 0.0521 0.0005 0.0526 (0.0526) 1.00 5.43 0.68 5.21
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0379 (0.0001) 0.0378 (0.0378) 1.00 4.23(b) 0.18(b) 4.13(b)
1994-FST
Administration
shares(d)....... 1.00 0.0388 (0.0001) 0.0387 (0.0387) 1.00 3.97(b) 0.43(b) 4.24(b)
1994-FST Service
shares(d)....... 1.00 0.0349 (0.0001) 0.0348 (0.0348) 1.00 3.71(b) 0.68(b) 3.82(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0301 0.0007 0.0308 (0.0307) 1.00 3.11 0.17 3.01
1994-FST
Administration
shares.......... 1.00 0.0276 0.0006 0.0282 (0.0281) 1.00 2.85 0.42 2.76
1994-FST Service
shares.......... 1.00 0.0251 0.0008 0.0259 (0.0256) 1.00 2.60 0.67 2.51
1993-FST shares. 1.00 0.0342 0.0012 0.0354 (0.0355) 1.00 3.69 0.18 3.42
1993-FST
Administration
shares(e) ...... 1.00 0.0009 -- 0.0009 (0.0009) 1.00 2.83(b) 0.43(b) 2.83(b)
1993-FST Service
shares.......... 1.00 0.0296 0.0016 0.0312 (0.0309) 1.00 3.17 0.68 2.96
1992-FST shares. 1.00 0.0549 0.0015 0.0564 (0.0561) 1.00 5.84 0.18 5.49
1992-FST Service
shares(e)....... 1.00 0.0113 0.0006 0.0119 (0.0116) 1.00 4.47(b) 0.68(b) 3.77(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0600 0.0006 0.0606 (0.0605) 1.00 8.06(b) 0.21(b) 7.74(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $2,140,063 0.24%(b) 5.22%(b)
1997-FST Pre-
ferred shares .. 2,826 0.34(b) 5.12(b)
1997-FST Admin-
istration shares
................. 638,287 0.49(b) 4.97(b)
1997-FST Service
shares ......... 232,548 0.74(b) 4.72(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 2,291,051 0.24 5.16
1996-FST
Preferred
shares(c)....... 46,637 0.34(b) 5.05(b)
1996-FST
Administration
shares.......... 536,895 0.49 4.91
1996-FST Service
shares.......... 220,560 0.74 4.66
1995-FST shares. 1,587,715 0.23 5.68
1995-FST
Administration
shares.......... 283,186 0.48 5.42
1995-FST Service
shares.......... 139,117 0.73 5.16
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 958,196 0.25(b) 4.06(b)
1994-FST
Administration
shares(d)....... 82,124 0.50(b) 4.17(b)
1994-FST Service
shares(d)....... 81,162 0.75(b) 3.75(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 812,420 0.24 2.94
1994-FST
Administration
shares.......... 24,485 0.49 2.69
1994-FST Service
shares.......... 35,656 0.74 2.44
1993-FST shares. 776,181 0.26 3.34
1993-FST
Administration
shares(e) ...... 1 0.51(b) 2.75(b)
1993-FST Service
shares.......... 5,155 0.76 2.88
1992-FST shares. 413,171 0.28 5.39
1992-FST Service
shares(e)....... 3,634 0.78(b) 3.67(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 229,988 0.34(b) 7.61(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
(e)FST Administration and FST Service share activity commenced during January
of 1993 and October of 1991, respectively.
(f)Commencement of operations.
7
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Instruments Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $1.00 $ 0.0168 0.0002 $ 0.0170 $(0.0170) $1.00 5.29%(b) 0.18%(b) 5.12%(b)
1997-FST Pre-
ferred shares
(c)............. 1.00 0.0043 0.0002 0.0045 (0.0045) 1.00 5.19(b) 0.28(b) 5.04(b)
1997-FST Admin-
istration shares
(c)............. 1.00 0.0122 0.0002 0.0124 (0.0124) 1.00 5.06(b) 0.43(b) 4.89(b)
1997-FST Service
shares (c)...... 1.00 0.0150 0.0002 0.0152 (0.0152) 1.00 4.73(b) 0.68(b) 4.63(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET
ASSETS AT RATIO OF NET
END RATIO OF INVESTMENT
OF PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $237,444 0.36%(b) 4.94%(b)
1997-FST Pre-
ferred shares
(c)............. 2 0.46(b) 4.86(b)
1997-FST Admin-
istration shares
(c)............. 1,132 0.61(b) 4.71(b)
1997-FST Service
shares (c)...... 35,901 0.86(b) 4.45(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the
investment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Share, FST Preferred Share, FST Administration Share, and FST Service
Share activity commenced March 3, 1997, May 30, 1997, April 1, 1997, and
March 5, 1997, respectively.
8
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Government Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
----------------------------------------
NET ASSET TOTAL
VALUE AT NET NET REALIZED GAIN INCOME FROM DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT END TOTAL
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... $1.00 $ 0.0264 $0.0001 $ 0.0265 $(0.0265) $1.00 5.47%(b)
1997-FST Preferred
shares............... 1.00 0.0259 0.0001 0.0260 (0.0260) 1.00 5.37(b)
1997-FST Administra-
tion shares.......... 1.00 0.0251 0.0001 0.0252 (0.0252) 1.00 5.21(b)
1997-FST Service
shares............... 1.00 0.0239 0.0001 0.0240 (0.0240) 1.00 4.95(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 1.00 0.0525 0.0001 0.0526 (0.0526) 1.00 5.38
1996-FST Preferred
shares(c)............ 1.00 0.0344 0.0001 0.0345 (0.0345) 1.00 5.26(b)
1996-FST Administra-
tion shares.......... 1.00 0.0501 0.0001 0.0502 (0.0502) 1.00 5.12
1996-FST Service
shares............... 1.00 0.0474 0.0001 0.0475 (0.0475) 1.00 4.86
1995-FST shares...... 1.00 0.0581 0.0001 0.0582 (0.0582) 1.00 6.00
1995-FST Administra-
tion shares.......... 1.00 0.0554 0.0001 0.0555 (0.0555) 1.00 5.74
1995-FST Service
shares(d)............ 1.00 0.0320 -- 0.0320 (0.0320) 1.00 5.40(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 1.00 0.0424 -- 0.0424 (0.0424) 1.00 4.36(b)
1994-FST Administra-
tion shares(e)....... 1.00 0.0426 -- 0.0426 (0.0426) 1.00 4.10(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 1.00 0.0256 0.0001 0.0257 (0.0257) 1.00 3.14(b)
1993-FST Administra-
tion shares(d)....... 1.00 0.0120 0.0001 0.0121 (0.0121) 1.00 2.87(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET RATIO OF NET
RATIO OF NET INVESTMENT NET RATIO OF INVESTMENT
EXPENSES TO INCOME TO ASSETS AT END EXPENSES TO INCOME TO
AVERAGE NET AVERAGE NET OF PERIOD AVERAGE NET AVERAGE NET
ASSETS ASSETS (IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... 0.18%(b) 5.33%(b) $1,222,437 0.22%(b) 5.29%(b)
1997-FST Preferred
shares............... 0.28(b) 5.32(b) 48,896 0.32(b) 5.28(b)
1997-FST Administra-
tion shares.......... 0.43(b) 5.07(b) 190,742 0.47(b) 5.03(b)
1997-FST Service
shares............... 0.68(b) 4.83(b) 603,520 0.72(b) 4.79(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 0.18 5.25 858,769 0.24 5.19
1996-FST Preferred
shares(c)............ 0.28(b) 5.14(b) 112 0.34(b) 5.08(b)
1996-FST Administra-
tion shares.......... 0.43 5.01 145,108 0.49 4.95
1996-FST Service
shares............... 0.68 4.74 223,554 0.74 4.68
1995-FST shares...... 0.18 5.81 743,884 0.24 5.75
1995-FST Administra-
tion shares.......... 0.43 5.54 82,386 0.49 5.48
1995-FST Service
shares(d)............ 0.68(b) 5.08(b) 14,508 0.74(b) 5.02(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 0.15(b) 4.64(b) 258,350 0.25(b) 4.54(b)
1994-FST Administra-
tion shares(e)....... 0.40(b) 4.67(b) 54,253 0.50(b) 4.57(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 0.08(b) 3.10(b) 44,697 0.59(b) 2.59(b)
1993-FST Administra-
tion shares(d)....... 0.35(b) 2.85(b) 14,126 0.76(b) 2.44(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced April 6, 1993, September 1, 1993 and May 16, 1995, respectively.
(e) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
9
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Federal Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-----------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN ON INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $1.00 $ 0.0178 -- $ 0.0178 $ (0.0178) $1.00 5.47%(b) 0.18%(b) 5.36%(b)
1997-FST Pre-
ferred
shares(c)....... 1.00 0.0047 -- 0.0047 (0.0047) 1.00 5.46(b) 0.28(b) 5.28(b)
1997-FST Admin-
istration
shares(c)....... 1.00 0.0128 -- 0.0128 (0.0128) 1.00 5.25(b) 0.43(b) 5.17(b)
1997-FST Service
shares(c)....... 1.00 0.0131 -- 0.0131 (0.0131) 1.00 4.99(b) 0.68(b) 4.90(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
NET EXPENSE LIMITATIONS
ASSETS -------------------------
AT END RATIO OF NET
OF RATIO OF INVESTMENT
PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $714,024 0.36%(b) 5.18%(b)
1997-FST Pre-
ferred
shares(c)....... 2 0.46(b) 5.10(b)
1997-FST Admin-
istration
shares(c)....... 137,933 0.61(b) 4.99(b)
1997-FST Service
shares(c)....... 122,323 0.86(b) 4.72(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST share, FST Preferred share, FST Administration share, and FST Service
share activity commenced February 28, 1997, May 30, 1997, April 1, 1997 and
March 25, 1997, respectively.
10
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Tax-Free Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET NET TOTAL
ASSET NET REALIZED INCOME NET ASSET RATIO OF NET
VALUE AT INVEST- GAIN ON FROM DISTRIBUTIONS VALUE AT EXPENSES TO
BEGINNING MENT INVESTMENT INVESTMENT TO END OF TOTAL AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS PERIOD RETURN (A) ASSETS
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $ 0.0170 -- $ 0.0170 $(0.0170) $1.00 3.49%(b) 0.18%(b)
1997-FST Pre-
ferred shares... 1.00 0.0165 -- 0.0165 (0.0165) 1.00 3.39(b) 0.28(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0158 -- 0.0158 (0.0158) 1.00 3.23(b) 0.43(b)
1997-FST Service
shares.......... 1.00 0.0146 -- 0.0146 (0.0146) 1.00 2.97(b) 0.68(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 1.00 0.0335 -- 0.0335 (0.0335) 1.00 3.39 0.18
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0218 -- 0.0218 (0.0218) 1.00 3.30(b) 0.28(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0310 -- 0.0310 (0.0310) 1.00 3.13 0.43
1996-FST Service
shares.......... 1.00 0.0285 -- 0.0285 (0.0285) 1.00 2.88 0.68
1995-FST shares. 1.00 0.0381 -- 0.0381 (0.0381) 1.00 3.89 0.14
1995-FST Admin-
istration
shares.......... 1.00 0.0354 -- 0.0354 (0.0354) 1.00 3.63 0.39
1995-FST Service
shares.......... 1.00 0.0332 -- 0.0332 (0.0332) 1.00 3.38 0.64
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 1.00 0.0156 -- 0.0156 (0.0156) 1.00 3.41(b) 0.07(b)
1994-FST
Administration shares(d). 1.00 0.0136 -- 0.0136 (0.0136) 1.00 3.19(b) 0.32(b)
1994-FST Service
shares(d)....... 1.00 0.0091 -- 0.0091 (0.0091) 1.00 3.11(b) 0.57(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET NET RATIO OF NET
INVESTMENT ASSETS AT RATIO OF INVESTMENT
INCOME TO END OF EXPENSES TO INCOME TO
AVERAGE NET PERIOD AVERAGE NET AVERAGE NET
ASSETS (IN 000'S) ASSETS ASSETS
-------------------------------------------------
<S> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... 3.46%(b) $731,783 0.22%(b) 3.42%(b)
1997-FST Pre-
ferred shares... 3.24(b) 5,468 0.32(b) 3.20(b)
1997-FST Admin-
istration
shares.......... 3.25(b) 96,496 0.47(b) 3.21(b)
1997-FST Service
shares.......... 2.94(b) 27,597 0.72(b) 2.90(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 3.35 440,838 0.23 3.30
1996-FST Pre-
ferred
shares(c)....... 3.26(b) 28,731 0.33(b) 3.21(b)
1996-FST Admin-
istration
shares.......... 3.10 51,661 0.48 3.05
1996-FST Service
shares.......... 2.85 19,855 0.73 2.80
1995-FST shares. 3.81 448,367 0.24 3.71
1995-FST Admin-
istration
shares.......... 3.54 20,939 0.49 3.44
1995-FST Service
shares.......... 3.32 19,860 0.74 3.22
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 3.42(b) 183,570 0.31(b) 3.18(b)
1994-FST
Administration shares(d). 3.25(b) 2,042 0.56(b) 3.01(b)
1994-FST Service
shares(d)....... 3.32(b) 2,267 0.81(b) 3.08(b)
</TABLE>
- --------------
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced July 19, 1994, August 1, 1994 and September 23, 1994, respectively.
11
<PAGE>
AN INTRODUCTION TO THE FUNDS
THE TRUST: The Trust is a no-load, open-end, management investment company
registered under the Investment Company Act of 1940, as amended (the "Invest-
ment Company Act"). Each Fund is a separate pool of assets which pursues its
investment objective through separate investment policies, as described below.
THE ADVISER: Goldman Sachs Asset Management, a separate operating division
of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds' investment ad-
viser (the "Adviser" or "GSAM").
THE DISTRIBUTOR: Goldman Sachs, which serves as the Funds' distributor and
transfer agent, is one of the largest international investment banking and
brokerage firms in the United States.
THE INVESTORS: The Funds are designed for institutional investors seeking a
high rate of return, a stable net asset value and convenient liquidation priv-
ileges. The Funds are particularly suitable for banks, corporations and other
financial institutions that seek investment of short-term funds for their own
accounts or for the accounts of their customers. Shares of the Government Fund
are intended to qualify as eligible investments for Federally chartered credit
unions pursuant to Sections 107(7), 107(8) and 107(15) of the Federal Credit
Union Act, Part 703 of the National Credit Union Administration ("NCUA") Rules
and Regulations and NCUA Letter Number 155. The Fund intends to review changes
in the applicable laws, rules and regulations governing eligible investments
for federally chartered credit unions, and to take such action as may be nec-
essary so that the investments of the Fund qualify as eligible investments un-
der the Federal Credit Union Act and the regulations thereunder. Shares of the
Government Fund, however, may or may not qualify as eligible investments for
particular state chartered credit unions. State chartered credit unions should
consult qualified legal counsel to determine whether the Government Fund is a
permissible investment under the law applicable to it.
THE FUNDS: Each Fund's securities are valued by the amortized cost method as
permitted by a rule ("Rule 2a-7") of the Securities and Exchange Commission
("SEC"). Under such rule, each Fund may invest only in securities that are de-
termined to present minimal credit risk and meet certain other criteria.
TAXABLE FUNDS: Prime Obligations, Money Market, Premium Money Market,
Treasury Obligations and Government Funds.
TAX ADVANTAGED FUNDS: Treasury Instruments and Federal Funds.
TAX-EXEMPT FUNDS: Tax-Free Money Market and Municipal Money Market Funds.
INVESTMENT OBJECTIVES AND POLICIES FOR TAXABLE, TAX-ADVANTAGED AND TAX-
EXEMPT FUNDS: To maximize current income to the extent consistent with the
preservation of capital and the maintenance of liquidity by investing ex-
clusively in high quality money market instruments. In order to obtain a
rating from a rating organization, the Premium Money Market Fund will ob-
serve special investment restrictions. The Treasury Instruments and Federal
Funds pursue their objectives by limiting their investments to certain U.S.
Treasury Obligations and U.S. Government Securities (each as defined here-
in), respectively, the interest from which is generally exempt from state
income taxation. Each investor should consult his or her tax adviser to de-
termine whether distributions from the Treasury Instruments and Federal
Funds (and any other Fund that may hold such obligations) derived from in-
terest on such obligations are exempt from state income taxation in the in-
vestor's own state.
NET ASSET VALUE: Each Fund seeks to maintain a stable net asset value of
$1.00 per share.
MAXIMUM REMAINING MATURITY OF PORTFOLIO INVESTMENTS: Thirteen months at the
time of purchase.
12
<PAGE>
DOLLAR-WEIGHTED AVERAGE PORTFOLIO MATURITY ("WAM"): Not more than ninety
days as required by Rule 2a-7.
FIRST TIER SECURITIES: Each Fund may purchase securities which are rated (or
that have been issued by an issuer that is rated with respect to a class of
short-term debt obligations, or any security within that class, comparable in
priority and quality with such securities) in the highest short-term rating
category by at least two NRSROs (as defined below), or if only one NRSRO has
assigned a rating, by that NRSRO. U.S. Government Securities as defined herein
are considered First Tier Securities.
SECOND TIER SECURITIES: The Tax-Exempt Funds may purchase securities which
are not First Tier Securities but which are rated in the top two short-term
rating categories by at least two NRSROs, or if only one NRSRO has assigned a
rating, by that NRSRO. The Taxable Funds will not invest in a security which
is a Second Tier Security at the time of purchase.
UNRATED SECURITIES: To the extent permitted by Rule 2a-7, unrated securities
may be purchased if they are deemed to be of comparable quality to First Tier
Securities, or to the extent that a Fund may purchase Second Tier Securities,
comparable in quality to Second Tier Securities.
NRSROS: Nationally Recognized Statistical Rating Organizations include Stan-
dard & Poor's Ratings Group ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Fitch Investors Services, Inc., Duff and Phelps, Inc., IBCA Lim-
ited and its affiliate IBCA Inc., and Thomson BankWatch, Inc. For a descrip-
tion of each NRSRO's rating categories, see Appendix A to the Statement of Ad-
ditional Information.
13
<PAGE>
INVESTMENT POLICIES MATRIX
<TABLE>
<CAPTION>
SHORT-TERM
OBLIGATIONS OF ASSET-BACKED & FOREIGN
US US CORPORATIONS RECEIVABLES- GOVERNMENT
TREASURY GOVERNMENT BANK COMMERCIAL AND OTHER REPURCHASE BACKED OBLIGATIONS
FUND OBLIGATIONS SECURITIES OBLIGATIONS PAPER ENTITIES AGREEMENTS SECURITIES+ (US$)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Prime Obligations [_] [_] [_] [_] [_] [_] [_]
U.S. banks U.S. entities
only only
- ------------------------------------------------------------------------------------------------------------------------
Money Market [_] [_] [_] [_] [_] [_] [_] [_]
Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Premium Money [_] [_] [_] [_] [_] [_] [_] [_]
Market Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_] [_]
Obligations
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_]
Instruments
- ------------------------------------------------------------------------------------------------------------------------
Government [_] [_] [_]
- ------------------------------------------------------------------------------------------------------------------------
Federal [_] [_] (Does not
intend to
invest)
- ------------------------------------------------------------------------------------------------------------------------
Tax-Free Money [_]
Market Tax-exempt
only
- ------------------------------------------------------------------------------------------------------------------------
Municipal Money [_]
Market Tax-exempt
only
</TABLE>
Note: See "Description of Securities and Investment Techniques" for a descrip-
tion of, and certain criteria applicable to, each of these categories of
investments.
+To the extent required by Rule 2a-7, asset-backed and receivables-backed
securities will be rated by the requisite number of NRSROs.
14
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
SUMMARY OF
TAXABLE TAX-EXEMPT CREDIT INVESTMENT UNRATED TAXATION FOR
MUNICIPALS MUNICIPALS QUALITY**** COMPANIES SECURITIES DISTRIBUTIONS* MISCELLANEOUS
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
[_] First [_] [ ] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
[_] First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
[_]
First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets generally
in other exempt from
investment state taxation
companies
- ---------------------------------------------------------------------------------------------------
First [_]
Tier Up to 10% of Taxable
total assets federal and
in other state**
investment
companies
- ---------------------------------------------------------------------------------------------------
Under
First [_] Taxable extraordinary
Tier Up to 10% of federal and circumstances,
total assets generally may hold cash,
in other exempt from U.S. Government
investment state taxation Securities
companies subject to state
taxation or cash
equivalents
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May (but does
At least 80% of Second Up to 10% of federal and not currently
net assets in Tier total assets taxable intend to)
Municipal in other state*** invest up to 20%
Instruments investment in AMT
(except in companies securities and
extraordinary may temporarily
circumstances) invest in the
taxable money
market
instruments
described herein
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May invest up to
At least 80% of Second Up to 10% of federal and 100% in AMT
net assets in Tier total assets taxable securities and
Municipal in other state*** may temporarily
Instruments investment invest in the
(except in companies taxable money
extraordinary market
circumstances) instruments
described herein
- ---------------------------------------------------------------------------------------------------
</TABLE>
* See "Taxes" below for an explanation of the tax consequences summarized
in the table above.
** Taxable in many states except for distributions from U.S. Treasury obli-
gation interest income and certain U.S. Government securities interest
income.
*** Taxable except for distributions from interest on obligations of an in-
vestor's state of residence in certain states.
**** To the extent permitted by Rule 2a-7, a Fund holding a security fully
supported by a guarantee may substitute the credit quality of the guaran-
tee in determining the credit quality of the security.
15
<PAGE>
DESCRIPTION OF SECURITIES AND INVESTMENT TECHNIQUES
U.S. TREASURY OBLIGATIONS
"U.S. Treasury Obligations" are securities issued or guaranteed by the U.S.
Treasury, payments of principal and interest on which are backed by the full
faith and credit of the U.S. Government.
U.S. GOVERNMENT SECURITIES
"U.S. Government Securities" are obligations issued or guaranteed by the
U.S. Government, its agencies, authorities or instrumentalities. Unlike U.S.
Treasury Obligations, securities issued or guaranteed by U.S. Government agen-
cies, authorities or instrumentalities are supported either by (a) the full
faith and credit of the U.S. Government (such as securities of the Government
National Mortgage Association), (b) the right of the issuer to borrow from the
Treasury (such as securities of the Student Loan Marketing Association), (c)
the discretionary authority of the U.S. Government to purchase the agency's
obligations (such as securities of the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation), or (d) only the credit of the
issuer. No assurance can be given that the U.S. Government will provide finan-
cial support to U.S. Government agencies, authorities or instrumentalities in
the future. U.S. Government Securities may include zero coupon bonds. Such
bonds may be purchased when yields are attractive.
Securities guaranteed as to principal and interest by the U.S. Government,
its agencies, authorities or instrumentalities are deemed to include (a) secu-
rities for which the payment of principal and interest is backed by an irrevo-
cable letter of credit issued by the U.S. Government, its agencies, authori-
ties or instrumentalities and (b) participations in loans made to foreign gov-
ernments or their agencies that are so guaranteed. The secondary market for
certain of these participations is limited. Such participations may therefore
be regarded as illiquid.
Each Fund may also invest in separately traded principal and interest compo-
nents of securities guaranteed or issued by the U.S. Treasury if such compo-
nents are traded independently under the Separate Trading of Registered Inter-
est and Principal of Securities program ("STRIPS").
The Treasury Instruments and Federal Funds invest in U.S. Treasury Obliga-
tions and the Federal Fund may also invest in certain U.S. Government Securi-
ties the interest from which is generally exempt from state income taxation.
Securities generally eligible for this exemption include those issued by the
U.S. Treasury and those issued by certain agencies, authorities or instrumen-
talities of the U.S. Government, including the Federal Home Loan Banks, Fed-
eral Farm Credit Banks, Tennessee Valley Authority and the Student Loan Mar-
keting Association.
CUSTODIAL RECEIPTS
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may also acquire securities issued or guaranteed as
to principal and interest by the U.S. Government, its agencies, authorities or
instrumentalities in the form of custodial receipts that evidence ownership of
future interest payments, principal payments or both on certain notes or bonds
issued by the U.S. Government, its agencies, authorities or instrumentalities.
For certain securities law purposes, custodial receipts are not considered ob-
ligations of the U.S. Government.
U.S. AND FOREIGN BANK OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "U.S. Bank Obligations" limited to securities issued or guaranteed by
U.S. banks (including certificates of deposit, commer -
16
<PAGE>
cial paper, unsecured bank promissory notes and bankers' acceptances) which
have more than $1 billion in total assets at the time of purchase. Such obli-
gations may also include debt obligations issued by U.S. subsidiaries of such
banks.
The Money Market and Premium Money Market Funds may also invest in "Foreign
Bank Obligations" limited to U.S. dollar-denominated obligations issued or
guaranteed (including fixed time deposits) by foreign banks which have more
than $1 billion in total assets at the time of purchase, U.S. branches of such
foreign banks (Yankee obligations), foreign branches of such foreign banks and
foreign branches of U.S. banks having more than $1 billion in total assets at
the time of purchase. Such bank obligations may be general obligations of the
parent bank or may be limited to the issuing branch by the terms of the spe-
cific obligations or by government regulation.
The Money Market and Premium Money Market Funds will invest more than 25% of
their total assets in bank obligations (whether foreign or domestic), includ-
ing bank commercial paper. However, if adverse economic conditions prevail in
the banking industry (such as substantial losses on loans, increases in non-
performing assets and charge-offs and declines in total deposits) the Funds
may, for defensive purposes, temporarily invest less than 25% of their total
assets in bank obligations. As a result, the Funds may be especially affected
by favorable and adverse developments in or related to the banking industry.
The activities of U.S. banks and most foreign banks are subject to comprehen-
sive regulations which, in the case of U.S. regulations, have undergone sub-
stantial changes in the past decade. The enactment of new legislation or regu-
lations, as well as changes in interpretation and enforcement of current laws,
may affect the manner of operations and profitability of domestic and foreign
banks. Significant developments in the U.S. banking industry have included de-
regulation of interest rates, increased competition from other types of finan-
cial institutions, increased acquisition activity, geographic expansion and,
during the late 1980's, an increased number of bank failures. Banks may be
particularly susceptible to certain economic factors, such as interest rate
changes and adverse developments in the market for real estate. Fiscal and
monetary policy and general economic cycles can affect the availability and
cost of funds, loan demand and asset quality and thereby impact the earnings
and financial conditions of banks. See "Foreign Government Obligations--For-
eign Risks" below.
COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Commercial Paper" (including variable amount master demand notes and
asset-backed commercial paper) which is payable in U.S. dollars and is issued
or guaranteed by U.S. corporations, U.S. commercial banks, foreign corpora-
tions (Money Market and Premium Money Market Funds only), foreign commercial
banks (Money Market and Premium Money Market Funds only) or other entities. In
addition, the Funds may invest in other short-term obligations (including
short-term funding agreements) payable in U.S. dollars and issued or guaran-
teed by U.S. corporations, foreign corporations (Money Market and Premium
Money Market Funds only) or other entities.
ASSET-BACKED AND RECEIVABLES-BACKED SECURITIES
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Asset-Backed and Receivables-Backed Securities" which represent par-
ticipations in, or are secured by and payable from, pools of assets such as
motor vehicle installment sale contracts, installment loan contracts, leases
of various types of real and personal property, receivables from revolving
credit (credit card) agreements and other categories of receivables. Such as-
set pools are securitized through the use of privately-formed trusts or spe-
cial purpose corporations. Payments or distributions of principal and interest
may be guaranteed up to certain amounts and
17
<PAGE>
for a certain time period by a letter of credit or a pool insurance policy is-
sued by a financial institution, or other credit enhancements may be present.
To the extent consistent with its investment objectives and policies, each of
the Prime Obligations, Money Market and Money Market Plus Funds may invest in
new types of mortgage-related securities and in other asset-backed securities
that may be developed in the future.
FOREIGN GOVERNMENT OBLIGATIONS
The Money Market and Premium Money Market Funds may invest in U.S. dollar-
denominated obligations (limited to commercial paper and other notes) issued
or guaranteed by a foreign government or any entity located or organized in a
foreign country that maintains a short-term foreign currency rating in the
highest short-term ratings category by the requisite number of NRSROs. The
Money Market and Premium Money Market Funds may not invest more than 25% of
their total assets in the securities of any one foreign government.
FOREIGN RISKS. Investments in foreign securities and bank obligations may
present a greater degree of risk than investments in securities of domestic
issuers because of less publicly-available financial and other information,
less securities regulation, potential imposition of foreign withholding and
other taxes, war, expropriation or other adverse governmental actions. Foreign
banks and their foreign branches are not regulated by U.S. banking authori-
ties, and generally are not bound by the accounting, auditing and financial
reporting standards applicable to U.S. banks.
MUNICIPAL OBLIGATIONS
MUNICIPAL INSTRUMENTS. Obligations issued by or on behalf of states, terri-
tories and possessions of the United States and their political subdivisions,
agencies, authorities and instrumentalities, and the District of Columbia, the
interest from which is, in the opinion of bond counsel, if any, excluded from
gross income for federal income tax purposes.
TYPES OF MUNICIPAL INSTRUMENTS:
<TABLE>
<CAPTION>
TAX-FREE MONEY MARKET AND
MUNICIPAL MONEY MARKET FUNDS
-------------------------------------------------------------------------
<S> <C>
FIXED RATE NOTES AND SIMILAR In highest short-term or one of the
DEBT INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
VARIABLE AND FLOATING RATE In highest short-term or one of the
DEMAND INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
TAX-EXEMPT COMMERCIAL PAPER In highest rating category
-------------------------------------------------------------------------
MUNICIPAL BONDS In one of the two highest rating
categories
-------------------------------------------------------------------------
UNRATED NOTES, PAPER, BONDS AND Determined to be of comparable quality
OTHER INSTRUMENTS by Adviser pursuant to criteria
approved by the Trustees
</TABLE>
18
<PAGE>
As a matter of fundamental policy, at least 80% of each of the Tax-Free
Money Market and Municipal Money Market Fund's net assets will ordinarily be
invested in Municipal Instruments. Each Tax-Exempt Fund may temporarily invest
in taxable money market instruments when the Adviser believes that the market
conditions dictate a defensive posture. Investments in taxable money market
instruments will be limited to those meeting the quality standards of each
Tax-Exempt Fund. The Prime Obligations, Money Market and Premium Money Market
Funds may invest in short-term obligations issued or guaranteed by state and
municipal governments when yields on such securities are attractive compared
to other taxable investments.
MUNICIPAL NOTES AND BONDS. Municipal notes include tax anticipation notes
("TANs"), revenue anticipation notes ("RANs"), bond anticipation notes
("BANs"), tax and revenue anticipation notes ("TRANs") and construction loan
notes. Municipal bonds include general obligation bonds and revenue bonds.
General obligation bonds are backed by the taxing power of the issuing munici-
pality and are considered the safest type of bonds. Revenue bonds are backed
by the revenues of a project or facility such as the tolls from a toll bridge.
Revenue bonds also include lease rental revenue bonds which are issued by a
state or local authority for capital projects and are secured by annual lease
payments from the state or locality sufficient to cover debt service on the
authority's obligations. Industrial development bonds (generally referred to
under current tax law as "private activity bonds") are a specific type of rev-
enue bond backed by the credit and security of a private user and therefore
have more potential risk. Municipal bonds may be issued in a variety of forms,
including commercial paper, tender option bonds and variable and floating rate
securities.
TENDER OPTION BONDS. A tender option bond is a Municipal Instrument (gener-
ally held pursuant to a custodial arrangement) having a relatively long matu-
rity and bearing interest at a fixed rate substantially higher than prevailing
short-term, tax-exempt rates. The bond is typically issued in conjunction with
the agreement of a third party, such as a bank, broker-dealer or other finan-
cial institution, pursuant to which such institution grants the security
holder the option, at periodic intervals, to tender its securities to the in-
stitution and receive the face value thereof. As consideration for providing
the option, the financial institution receives periodic fees equal to the dif-
ference between the bond's fixed coupon rate and the rate, as determined by a
remarketing or similar agent at or near the commencement of such period, that
would cause the securities, coupled with the tender option, to trade at par on
the date of such determination. Thus, after payment of this fee, the security
holder effectively holds a demand obligation that bears interest at the pre-
vailing short-term, tax-exempt rate. However, an institution will not be obli-
gated to accept tendered bonds in the event of certain defaults or a signifi-
cant downgrading in the credit rating assigned to the issuer of the bond. The
tender option will be taken into account in determining the maturity of the
tender option bonds and a Fund's average portfolio maturity. There is a risk
that a Fund will not be considered the owner of a tender option bond for fed-
eral income tax purposes and thus will not be entitled to treat such interest
as exempt from federal income tax.
REVENUE ANTICIPATION WARRANTS. Revenue Anticipation Warrants ("RAWs") are
issued in anticipation of the issuer's receipt of revenues and present the
risk that such revenues will be insufficient to satisfy the issuer's payment
obligations. The entire amount of principal and interest on RAWs is due at ma-
turity. RAWs, including those with a maturity of more than 397 days, may also
be repackaged as instruments which include a demand feature that permits the
holder to sell the RAWs to a bank or other financial institution at a purchase
price equal to par plus accrued interest on each interest rate reset date.
FLOATING AND VARIABLE RATE OBLIGATIONS. The value of floating and variable
rate obligations generally is more stable than that of fixed rate obligations
in response to changes in interest rate levels. Variable and floating rate ob-
ligations usually have demand features that permit the Funds to sell them at
par value plus accrued interest
19
<PAGE>
upon short notice. The issuers or financial intermediaries providing demand
features may support their ability to purchase the obligations by obtaining
credit with liquidity supports. These may include lines of credit, which are
conditional commitments to lend and letters of credit, which will ordinarily
be irrevocable, both of which may be issued by domestic banks or foreign banks
which have a branch, agency or subsidiary in the United States. When consider-
ing whether an obligation meets a Fund's quality standards, the Fund will, to
the extent permitted by Rule 2a-7, look to the creditworthiness of the party
providing unconditional demand features or other unconditional obligations to
support the credit of the issuer of the security. A Fund may consider the ma-
turity of a variable or floating rate Municipal Instrument to be shorter than
its ultimate stated maturity if the Fund has the right to demand prepayment of
its principal at specified intervals prior to the security's ultimate stated
maturity, subject to the conditions for using amortized cost valuation under
the Investment Company Act. A Fund may purchase such variable or floating rate
obligations from the issuers or may purchase certificates of participation, a
type of floating or variable rate obligation, which are interests in a pool of
debt obligations held by a bank or other financial institution.
INDUSTRIAL DEVELOPMENT BONDS. The Funds (other than the Treasury Obliga-
tions, Treasury Instruments, Government and Federal Funds) may invest in in-
dustrial development bonds (generally referred to under current tax law as
"private activity bonds"), the interest from which would be an item of tax
preference when distributed as "exempt-interest dividends" to shareholders un-
der the federal alternative minimum tax. See "Taxes" and "Distributions." Mu-
nicipal Fund may invest up to 100% of its assets in private activity bonds.
Tax-Free Fund does not currently intend to invest in such bonds. If Tax-Free
Fund's policy not to invest in private activity bonds should change in the fu-
ture, shareholders would be notified and such investments would not exceed 20%
of Tax-Free Fund's net assets.
OTHER POLICIES. Ordinarily the Tax-Exempt Funds expect that 100% of their
portfolio securities will be Municipal Instruments. However, the Funds may
hold cash or invest in short-term taxable securities as set forth above. Such
Funds may invest 25% or more of the value of their respective total assets in
Municipal Instruments which are related in such a way that an economic, busi-
ness or political development or change affecting one Municipal Instrument
would also affect the other Municipal Instruments. For example, the Tax-Exempt
Funds may invest all of their respective assets in (a) Municipal Instruments
the interest on which is paid solely from revenues from similar projects such
as hospitals, electric utility systems, multi-family housing, nursing homes,
commercial facilities (including hotels), steel companies or life care facili-
ties, (b) Municipal Instruments whose issuers are in the same state or (c) in-
dustrial development obligations. Concentration of a Fund's investments in
these Municipal Instruments will subject the Fund, to a greater extent than if
such investment was more limited, to the risks of adverse economic, business
or political developments affecting any such state, industry or other area of
concentration.
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may purchase Municipal Instruments which are backed
by letters of credit, which will ordinarily be irrevocable, issued by domestic
banks or foreign banks (excluding Prime Obligations Fund) which have a branch,
agency or subsidiary in the United States. In addition, these Funds may ac-
quire securities in the form of custodial receipts which evidence ownership of
future interest payments, principal payments or both on obligations of certain
state and local governments and authorities.
In order to enhance the liquidity, stability, or quality of a Municipal In-
strument, each Fund (other than the Treasury Obligations, Treasury Instru-
ments, Government and Federal Funds) may acquire the right to sell the secu-
rity to another party at a guaranteed price and date.
20
<PAGE>
REPURCHASE AGREEMENTS
Each Fund (other than the Treasury Instruments Fund) may only enter into re-
purchase agreements with primary dealers in U.S. Government Securities. A re-
purchase agreement is an agreement under which a Fund purchases securities and
the seller agrees to repurchase the securities within a particular time at a
specified price. Such price will exceed the original purchase price, the dif-
ference being income to the Fund, and will be unrelated to the interest rate
on the purchased security. A Fund's custodian or sub-custodian will maintain
custody of the purchased securities for the duration of the agreement. The
value of the purchased securities, including accrued interest, will at all
times equal or exceed the value of the repurchase agreement. In the event of
bankruptcy of the seller or failure of the seller to repurchase the securities
as agreed, a Fund could suffer losses, including loss of interest on or prin-
cipal of the security and costs associated with delay and enforcement of the
repurchase agreement. In evaluating whether to enter into a repurchase agree-
ment, the Adviser will carefully consider the creditworthiness of the seller
pursuant to procedures reviewed and approved by the Trustees. Distributions of
the income from repurchase agreements entered into by a Fund will be taxable
to its shareholders. In addition, each Fund, together with other registered
investment companies having management agreements with the Adviser or any of
its affiliates, may transfer uninvested cash balances into a single joint ac-
count, the daily aggregate balance of which will be invested in one or more
repurchase agreements.
FORWARD COMMITMENTS AND WHEN-ISSUED SECURITIES
Each Fund may purchase when-issued securities and make contracts to purchase
or sell securities for a fixed price at a future date beyond customary settle-
ment time. A Fund is required to hold and maintain in a segregated account
with the Fund's custodian or sub-custodian until three days prior to settle-
ment date, cash or liquid assets in an amount sufficient to meet the purchase
price. Alternatively, a Fund may enter into offsetting contracts for the for-
ward sale of other securities that it owns. Securities purchased or sold on a
when-issued or forward commitment basis involve a risk of loss if the value of
the security to be purchased declines prior to the settlement date or if the
value of the security to be sold increases prior to the settlement date. Al-
though a Fund would generally purchase securities on a when-issued or forward
commitment basis with the intention of acquiring securities for its portfolio,
the Fund may dispose of a when-issued security or forward commitment prior to
settlement if the Adviser deems it appropriate to do so.
OTHER INVESTMENT COMPANIES
The Adviser will determine, under guidelines established by the Trustees,
whether securities issued by other money market investment companies present
minimal credit risks. The amount of each Fund's investments in securities of
other investment companies will be subject to the limitations on such invest-
ments prescribed by the Investment Company Act. These limits include a prohi-
bition on any Fund acquiring more than 3% of the voting shares of any other
investment company and a prohibition on investing more than 5% of a Fund's to-
tal assets in securities of any one investment company or more than 10% of its
total assets in securities of all investment companies. Each Fund will indi-
rectly bear its proportionate share of any management fees and other expenses
paid by such other investment companies. Such other investment companies will
have investment objectives, policies and restrictions substantially similar to
those of the acquiring Fund and will be subject to substantially the same
risks.
INVESTMENT LIMITATIONS
TAXABLE AND TAX-EXEMPT FUNDS. Each Fund will comply with the conditions for
using amortized cost valuation set forth in Rule 2a-7 under the Investment
Company Act including, but not limited to, those condi-
21
<PAGE>
tions relating to maturity, diversification and credit quality. These operat-
ing policies may be more restrictive than the fundamental policies set forth
in the Statement of Additional Information.
INVESTMENT RESTRICTIONS. Each Fund is subject to certain investment restric-
tions that are described in detail under "Investment Restrictions" in the
Statement of Additional Information. Fundamental investment restrictions of a
Fund cannot be changed without approval of a majority of the outstanding
shares of that Fund. Treasury Obligations Fund's policy of limiting its in-
vestments to U.S. Treasury Obligations and related repurchase agreements is
also fundamental. All investment objectives and policies not specifically des-
ignated as fundamental are non-fundamental and may be changed without share-
holder approval.
RESTRICTED AND OTHER ILLIQUID SECURITIES. Each Fund may purchase securities
that are not registered ("restricted securities") under the Securities Act of
1933 ("1933 Act"), but can be offered and sold to "qualified institutional
buyers" under Rule 144A under the 1933 Act. However, a Fund will not invest
more than 10% of its net assets in illiquid investments, which include fixed
time deposits maturing in more than seven days and restricted securities.
Restricted securities (including commercial paper issued pursuant to Section
4(2) of the 1933 Act) which the Board of Trustees has determined are liquid,
based upon a continuing review of the trading markets for the specific re-
stricted security, will not be deemed to be illiquid investments for purposes
of this restriction. The Board of Trustees may adopt guidelines and delegate
to the Adviser the daily function of determining and monitoring the liquidity
of restricted securities. The Board, however, will retain sufficient oversight
and be ultimately responsible for the determinations. Since it is not possible
to predict with assurance that the market for restricted securities eligible
for resale under Rule 144A will continue to be liquid, the Adviser will care-
fully monitor each Fund's investments in these securities, focusing on such
important factors, among others, as valuation, liquidity and availability of
information. This investment practice could have the effect of increasing the
level of illiquidity in a Fund to the extent that qualified institutional buy-
ers become for a time uninterested in purchasing these restricted securities.
In addition, each Fund may not invest in repurchase agreements maturing in
more than seven days and securities which are not readily marketable if, as a
result thereof, more than 10% of the net assets of that Fund (taken at market
value) would be invested in such investments. Certain repurchase agreements
which mature in more than seven days can be liquidated before the nominal
fixed term on seven days or less notice. Such repurchase agreements will be
regarded as liquid instruments.
MANAGEMENT
THE ADVISER
GSAM, One New York Plaza, New York, New York 10004, a separate operating di-
vision of Goldman, Sachs & Co., acts as investment adviser to the Funds.
Goldman Sachs registered as an investment adviser in 1981. As of July , 1997,
Goldman Sachs, together with its affiliates, acted as investment adviser, ad-
ministrator or distributor for approximately $ billion in assets.
As of November 29, 1996, Goldman Sachs and its consolidated subsidiaries had
assets of approximately $152 billion and partners' capital of $5.3 billion and
ranked as one of the largest international investment banking and brokerage
firms in the United States. Founded in 1869, Goldman Sachs is a major invest-
ment banking and brokerage firm providing a broad range of financing and in-
vestment services both in the United States and abroad.
22
<PAGE>
Pursuant to an SEC order, each Taxable and Tax-Advantaged Fund may enter
into principal transactions in certain taxable money market instruments, in-
cluding repurchase agreements, with Goldman Sachs.
Under the Management Agreement, GSAM continually manages each Fund, includ-
ing the purchase, retention and disposition of its securities and other as-
sets. In addition, GSAM administers each Fund's business affairs and performs
various shareholder servicing functions to the extent not provided by other
organizations. The management of each Fund is subject to the supervision of
the Trustees and each Fund's investment policies. For these services, the
Trust, on behalf of each Fund, pays GSAM a monthly fee at an annual rate of
each Fund's average daily net assets as follows:
<TABLE>
<CAPTION>
FISCAL YEAR
ENDED
CONTRACTUAL DECEMBER 31,
RATE 1996
----------- ------------
<S> <C> <C>
Financial Square Prime Obligations Fund................ .205% .17%
Financial Square Money Market Fund..................... .205% .17%
Financial Square Premium Money Market Fund............. .205% N/A*
Financial Square Treasury Obligations Fund............. .205% .17%
Financial Square Treasury Instruments Fund............. .205% N/A*
Financial Square Government Fund....................... .205% .17%
Financial Square Federal Fund.......................... .205% N/A*
Financial Square Tax Free Money Market Fund............ .205% .17%
Financial Square Municipal Money Market Fund........... .205% N/A*
</TABLE>
* As of December 31, 1996, the Premium Money Market Fund, Treasury Instruments
Fund, Federal Fund and Municipal Money Market Fund had not commenced opera-
tions.
A Management Agreement combining both advisory and administrative services
was adopted effective April 30, 1997. The contractual rate set forth in the
table is the rate payable under the Management Agreement and is identical to
the aggregate advisory and administration fees payable by each Fund under the
previously separate investment advisory and administration agreements. For the
fiscal year ended December 31, 1996, the annual rate expressed is the combined
advisory and administration fees paid (after voluntary fee limitations). The
difference, if any, between the stated fees and the actual fees paid by the
Funds reflects the fact that the Investment Adviser did not charge the full
amount of the fees to which it would have been entitled.
GSAM has agreed not to impose a portion of its management fee and/or to re-
duce or otherwise limit the total operating expenses of each Fund (excluding
fees payable to Service Organizations, as defined herein, taxes, interest,
brokerage and litigation, indemnification and other extraordinary expenses).
GSAM has no current intention to but may in the future discontinue or modify
any of such reductions or limitations at its discretion.
THE DISTRIBUTOR AND TRANSFER AGENT
Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606, serves as the Dis-
tributor of shares of each Fund pursuant to a Distribution Agreement with the
Trust. The Distributor will assist in the sale of shares of each Fund upon the
terms described herein. Goldman Sachs also serves as the Transfer Agent of
each Fund.
From time to time, Goldman Sachs or any of its affiliates may purchase and
hold shares of the Funds in order to increase the assets of the Funds. In-
creasing the Fund's assets may enhance investment flexibility and diversifica-
tion. Goldman Sachs reserves the right to redeem at any time some or all of
the Fund shares acquired for its own account. Goldman Sachs will consider the
effect of redemptions on the Funds and other shareholders in deciding whether
to redeem its shares.
23
<PAGE>
TAXES
Each Fund is treated as a separate entity for federal tax purposes. The
Treasury Instruments and Federal Funds intend to elect and each other Fund has
elected to be treated as a regulated investment company and each Fund intends
to continue to qualify for such treatment under Subchapter M of the Internal
Revenue Code of 1986 (the "Code") for each taxable year. To qualify as such,
each Fund must satisfy certain requirements relating to the sources of its in-
come, diversification of its assets and distribution of its income to share-
holders. As a regulated investment company, each Fund will not be subject to
federal income or excise tax on any net investment income and net realized
capital gains that are distributed to its shareholders in accordance with cer-
tain timing requirements of the Code.
Dividends paid by a Fund from net investment income, the excess of net
short-term capital gain over net long-term capital loss and taxable original
issue discount or market discount income will be taxable to shareholders as
ordinary income, except for any "exempt-interest dividends" paid by the Tax-
Exempt Funds, as described below. Dividends paid by a Fund from the excess of
net long-term capital gain over net short-term capital loss will be taxable as
long-term capital gain regardless of how long the shareholders have held their
shares. These tax consequences will apply to distributions of any Fund
regardless of whether distributions are received in cash or reinvested in
shares. Certain distributions paid by the Funds in January of a given year
will be taxable to shareholders as if received on December 31 of the year in
which they are declared. Shareholders will be informed annually about the
amount and character of distributions received from the Funds for federal
income tax purposes, including any distributions that may constitute a return
of capital or any distributions of Municipal Fund that may constitute a tax
preference item under the federal alternative minimum tax.
The Tax-Exempt Funds intend to satisfy certain requirements of the Code for
the payment of "exempt-interest dividends" not included in shareholders' fed-
eral gross income. Dividends paid by these Funds from interest on tax-exempt
obligations and properly designated by the Funds as exempt-interest dividends,
including dividends attributable to exempt-interest dividends received by a
Fund from other regulated investment companies, will generally be exempt from
federal income tax, although a portion of such dividends may be subject to the
federal alternative minimum tax. Exempt-interest dividends will be considered
in computing the corporate federal alternative minimum tax, and the extent, if
any, to which social security or railroad retirement benefits are taxable.
Persons who are "substantial users" of facilities financed by certain indus-
trial development or private activity bonds should consult their own tax ad-
visers before purchasing shares of these Funds. Interest incurred to purchase
or carry shares of these Funds will not be deductible for federal income tax
purposes to the extent related to exempt-interest dividends paid by the Funds.
Individuals and certain other classes of shareholders may be subject to 31%
backup withholding of federal income tax on taxable distributions if they fail
to furnish their correct taxpayer identification number and certain certifica-
tions required by the Internal Revenue Service or if they are otherwise sub-
ject to backup withholding. Individuals, corporations and other shareholders
that are not U.S. persons under the Code are subject to different tax rules
and may be subject to nonresident alien withholding at the rate of 30% (or a
lower rate provided by an applicable tax treaty) on amounts treated as ordi-
nary dividends from the Funds.
If a Fund invests in foreign securities, it may be subject to foreign with-
holding or other foreign taxes on income earned on such securities and is ex-
pected to be unable to pass such taxes through to shareholders, who therefore
are not expected to include such taxes in income or be entitled to claim for-
eign tax credits or deductions with respect to such taxes.
In addition to federal taxes, a shareholder may be subject to state, local
or foreign taxes on payments received from a Fund. A state income (and possi-
bly local income and/or intangible property) tax exemption is
24
<PAGE>
generally available to the extent a Fund's distributions are derived from in-
terest on (or, in the case of intangible property taxes, the value of its as-
sets is attributable to) certain U.S. Government obligations and/or tax-exempt
municipal obligations issued by or on behalf of the particular state or a po-
litical subdivision thereof, provided in some states that certain thresholds
for holdings of such obligations and/or reporting requirements are satisfied.
Shareholders should consult their own tax advisers concerning these matters.
NET ASSET VALUE
The net asset value of each Fund (other than the Government, Treasury Obli-
gations and Money Market Plus Funds) is determined as of the close of regular
trading on the New York Stock Exchange (normally 4:00 p.m. New York time) on
each Business Day. The net asset value of Government, Treasury Obligations and
Money Market Plus Funds is determined as of 5:00 p.m. New York time on each
Business Day. Net asset value per share for each class of shares of each Fund
is calculated by determining the amount of net assets attributable to each
class of shares and dividing by the number of shares for such class.
On any Business Day, as defined herein, when the Public Securities Associa-
tion ("PSA") recommends that the securities markets close early, the Treasury
Instruments and Federal Funds will cease, and each other Fund reserves the
right to cease, accepting purchase and redemption orders for same Business Day
credit at the time PSA recommends that the securities markets close. On days
any Fund closes early, purchase and redemption orders received after the PSA
recommended closing time will be credited to the next Business Day. In addi-
tion, each Fund reserves the right to advance the time by which purchase and
redemption orders must be received for same Business Day credit as permitted
by the SEC.
Each Fund seeks to maintain a net asset value of $1.00 per share. In this
connection, each Fund values its portfolio securities on the basis of amor-
tized cost. The amortized cost method values a security at its cost on the
date of purchase and thereafter assumes a constant amortization to maturity of
any discount or premium, regardless of the impact of fluctuating interest
rates on the market value of the instrument. For a more complete description
of the amortized cost valuation method and its effect on existing and prospec-
tive shareholders, see the Statement of Additional Information. There can be
no assurance that a Fund will be able at all times to maintain a net asset
value per share of $1.00.
YIELD INFORMATION
From time to time, each Fund may advertise its yield, effective yield and
average annual total return. Average annual total return is determined by com-
puting the average annual percentage change in value of $1,000 invested at the
maximum public offering price for a specified period of at least one year, as-
suming reinvestment of all dividends and distributions at net asset value. The
total return calculation assumes a complete redemption of the investment at
the end of the relevant period. Each Fund may furnish total return calcula-
tions based on a cumulative, average, year-by-year or other basis for various
specified periods by means of quotations, charts, graphs or schedules. The
yield of a Fund refers to the income generated by an investment in that Fund
over a seven-day period (which period will be stated in the advertisement).
This income is then annualized; that is, the amount of income generated by the
investment during that week is assumed to be generated each week over a 52-
week period and is shown as a percentage of the investment. The effective
yield is calculated similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The effective yield will
be slightly higher than the yield because of the compounding effect of this
assumed reinvestment.
The Tax-Exempt Funds and the Federal and Treasury Instruments Funds may each
also quote tax-equivalent yield. Each Fund's tax-equivalent yield is calcu-
lated by determining the rate of return that would have to be
25
<PAGE>
achieved on a fully taxable investment to produce the after-tax equivalent of
the Fund's yield, assuming certain tax brackets for a shareholder.
Investors should note that the investment results of a Fund are based on
historical performance and will fluctuate over time. Any presentation of a
Fund's total return, yield, effective yield or tax-equivalent yield for any
prior period should not be considered a representation of what an investment
may earn or what a Fund's total return, yield, effective yield or tax-equiva-
lent yield may be in any future period. In addition to the above, each Fund
may from time to time advertise its performance relative to certain averages,
performance rankings, indices, other information prepared by recognized mutual
fund statistical services and investments for which reliable performance data
is available.
Total return, yield, effective yield and tax-equivalent yield will be calcu-
lated separately for each class of shares in existence. Because each such
class of shares is subject to different expenses, the total return and net
yield of such classes of a Fund for the same period may differ. See "Organiza-
tion and Shares of the Trust" below.
ORGANIZATION AND SHARES OF THE TRUST
Each Fund is a series of the Goldman Sachs Trust, which was formed under the
laws of the State of Delaware on January 28, 1997. The Funds were formerly se-
ries of Goldman Sachs Money Market Trust, a Massachusetts business trust, and
were reorganized into the Trust as of April 30, 1997. The Trustees have au-
thority under the Trust's Declaration of Trust to create and classify shares
of beneficial interest in separate series, without further action by share-
holders. Additional series may be added in the future. The Trustees also have
authority to classify or reclassify any series or portfolio of shares into one
or more classes. (Institutions that provide services to holders of FST Pre-
ferred Shares, FST Administration Shares or FST Service Shares are referred to
in this Prospectus as "Service Organizations").
When issued, shares are fully paid and nonassessable. In the event of liqui-
dation, shareholders are entitled to share pro rata in the net assets of the
applicable Fund available for distribution to such shareholders. All shares
are freely transferable and have no preemptive, subscription or conversion
rights. Shareholders are entitled to one vote per share, provided that, at the
option of the Trustees, shareholders will be entitled to a number of votes
based upon the net asset values represented by their shares.
Shares of a Fund will be voted seperately by Fund with respect to matters
pertaining to that Fund except for the election of Trustees and ratification
of independent accountants. For example, shareholders of each Fund are re-
quired to approve the adoption of any management agreement relating to that
Fund and any changes in fundamental investment restrictions or policies of
such Fund. Approval by the shareholders of one Fund is effective only as to
that Fund.
As of August 8, 1997, Harris Trust & Savings Bank, 200 W. Monroe St. Fl 12,
Chicago, IL 60606, owned of record 35.04% of the outstanding shares of Trea-
sury Instruments Fund and National City Bank, P.O. Box 5756, Cleveland, OH
44101-0756, owned of record 32.86% of the outstanding shares of Premium Money
Market Fund.
The Trust does not intend to hold annual meetings of shareholders. However,
pursuant to the Trust's By-Laws, the recordholders of at least 10% of the
shares outstanding and entitled to vote at a special meeting may require the
Trust to hold such special meeting of shareholders for any purpose, and
recordholders may, under certain circumstances, as permitted by the Investment
Company Act, communicate with other shareholders in connection with requiring
a special meeting of shareholders. The Trustees will call a special meeting of
shareholders for the purpose of electing Trustees if, at any time, less than a
majority of Trustees holding office at the time were elected by shareholders.
26
<PAGE>
ADDITIONAL SERVICES
Each Fund has adopted a Service Plan with respect to the FST Service Shares
which authorizes it to compensate certain institutions for providing account
administration and personal and account maintenance services to their custom-
ers who are beneficial owners of such Shares (each a "Service Organization").
Each Fund will enter into agreements with Service Organizations which purchase
FST Service Shares on behalf of their customers ("Service Agreements"). The
Service Agreements will provide for compensation to the Service Organization
in an amount up to .50% (on an annualized basis) of the average daily net as-
set value of the FST Service Shares of that Fund attributable to or held in
the name of the Service Organization for its customers; provided, however,
that the fee paid for personal and account maintenance services shall not ex-
ceed .25% of such average daily net assets. The services provided by a Service
Organization may include acting, directly or through an agent, as the sole
shareholder of record, maintaining account records for its customers, and
processing orders to purchase, redeem and exchange FST Service Shares of a
Fund for its customers, responding to inquiries from prospective and existing
shareholders and assisting customers with investment procedures.
For the fiscal year ended December 31, 1996, the Trust, on behalf of Prime
Obligations Fund, Money Market Fund, Treasury Obligations Fund, Government
Fund and Tax-Free Fund paid Service Organizations fees at the annual rate of
..50% of each Fund's average daily net assets attributable to FST Service
Shares. As of December 31, 1996, the Premium Money Market Fund, Treasury In-
struments Fund, Federal Fund and Municipal Money Market Fund had not commenced
operations.
Holders of FST Service Shares of a Fund will bear all expenses and fees paid
to Service Organizations with respect to such Shares as well as any other ex-
penses which are directly attributable to such Shares.
Service Organizations may charge other fees to their customers who are the
beneficial owners of FST Service Shares in connection with their customer ac-
counts. These fees would be in addition to any amounts received by the Service
Organization under a Service Agreement and may affect an investor's return
with respect to an investment in a Fund.
All inquiries of beneficial owners of FST Service Shares of the Funds should
be directed to such owners' Service Organization.
PURCHASE OF SHARES
It is expected that all direct purchasers of FST Service Shares will be
Service Organizations or their nominees, which may purchase FST Service Shares
of the Funds through Goldman Sachs. Customers of Service Organizations may in-
vest in such shares only through their Service Organizations.
As set forth below, FST Service Shares of the Funds may be purchased on any
Business Day at the net asset value next determined after receipt from the
Service Organization of both the purchase order and the purchase amount in
federal funds. Purchase orders may be made by telephoning Goldman Sachs at
800-621-2550 or by a written request addressed to Goldman Sachs, Attention:
Shareholder Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois
60606. It is strongly recommended that payment be effected by wiring federal
funds to The Northern Trust Company ("Northern"), Chicago, Illinois, as the
sub-custodian for State Street Bank and Trust Company ("State Street").
Purchases of FST Service Shares may also be made by a Service Organization
by delivering a Federal Reserve draft or check (except that a third party
check will not be accepted) payable only to the appropriate
27
<PAGE>
Fund and drawn on a U.S. bank to Goldman Sachs, Attention: Shareholder Servic-
es, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606. It is ex-
pected that Federal Reserve drafts will ordinarily be converted to federal
funds on the day of receipt and that checks will be converted to federal funds
within two Business Days after receipt. FST Service Shares purchased by check
may not be redeemed until the check has cleared, as described under "Redemp-
tion of Shares."
Purchases of shares of any Fund may also be made through an Automated Clear-
ing House ("ACH") transfer to Goldman Sachs Trust c/o Northern, as
subcustodian for State Street. Purchase orders are effected at the net asset
value next determined after receipt of both the purchase order and the pur-
chase amount in federal funds. It is expected that ACH transfers will ordinar-
ily be converted to federal funds on the Business Day following receipt of the
ACH transfer.
FST Service Shares of each Fund are deemed to have been purchased when an
order becomes effective and are entitled to dividends on FST Service Shares
purchased as follows:
- -------------------------------------------------------------------------------
IF ORDER IS
RECEIVED
FROM A
SERVICE
ORGANIZATION
BY GOLDMAN
SACHS DIVIDENDS BEGIN
------------ ---------------
(1) Taxable and Tax-Advantaged Funds (except
Government, Treasury Obligations and
Premium Money Market Funds)
By: 3:00 p.m.--N.Y. time Same Business Day
- -----------------------------------------------------------------------------
After: 3:00 p.m.--N.Y. time Next Business Day
- -----------------------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By: 5:00 p.m.--N.Y. time Same Business Day
- -----------------------------------------------------------------------------
After: 5:00 p.m.--N.Y. time Next Business Day
- -----------------------------------------------------------------------------
(3) Municipal Fund
By: 1:00 p.m.--N.Y. time Same Business Day
- -----------------------------------------------------------------------------
After: 1:00 p.m.--N.Y. time Next Business Day
- -----------------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By: 2:00 p.m.--N.Y. time Same Business Day
- -----------------------------------------------------------------------------
After: 2:00 p.m.--N.Y. time Next Business Day
- -----------------------------------------------------------------------------
The Service Organizations are responsible for timely transmittal of purchase
orders to Goldman Sachs and federal funds to Northern. In order to facilitate
timely transmittal, the Service Organizations have established times by which
purchase orders and federal funds must be received by them.
28
<PAGE>
A Business Day means any day on which the New York Stock Exchange is open,
except for days on which Chicago, Boston or New York banks are closed for lo-
cal holidays.
FST Service Shares of a Fund are purchased at the net asset value per share
without the imposition of a sales charge. Goldman Sachs, as each Fund's trans-
fer agent, will maintain a complete record of transactions and FST Service
Shares held in each record holder's account. The Trust and Goldman Sachs each
reserves the right to reject any purchase order for any reason.
MINIMUM INVESTMENT AND OTHER INFORMATION
The minimum initial investment requirement is $10 million, which may be al-
located among the Funds. The Trust and Goldman Sachs each reserves the right
to waive the minimum investment requirement. A Service Organization may impose
a minimum amount for initial and subsequent investments in FST Service Shares
of the Funds, and may establish other requirements such as a minimum account
balance. A Service Organization may effect redemptions of noncomplying ac-
counts, and may impose a charge for any special services rendered to its cus-
tomers. Customers should contact their Service Organizations for further in-
formation concerning such requirements and charges. A Service Organization may
purchase FST Service Shares in connection with sweep account programs.
SUBSEQUENT INVESTMENTS
There is no minimum amount required for subsequent investments. Orders for
the purchase of additional FST Service Shares should be accompanied by infor-
mation identifying the account and the Fund in which FST Service Shares are to
be purchased.
REPORTS TO SHAREHOLDERS
The Trust will issue an annual report containing audited financial state-
ments and a semi-annual report to record holders of FST Service Shares of each
Fund, including Service Organizations who hold such Shares for the benefit of
their customers. Upon request, a printed confirmation for each transaction
will be provided by Goldman Sachs. Any dividends and distributions paid by the
Funds are also reflected in regular statements issued by Goldman Sachs to
shareholders of record. Service Organizations will be responsible for provid-
ing similar services to their own customers who are the beneficial owners of
such Shares.
DISTRIBUTIONS
All or substantially all of each Fund's net investment income will be de-
clared daily (as of 4:00 p.m. New York time for each Fund other than the Gov-
ernment, Treasury Obligations and Premium Money Market Funds and as of 5:00
p.m. New York time for the Government, Treasury Obligations and Premium Money
Market Funds) as a dividend and distributed to Service Organizations monthly.
Distributions will be made in additional FST Service Shares of the same Fund
or, at the election of a Service Organization, in cash. The election to rein-
vest dividends and distributions or receive them in cash may be changed by a
Service Organization at any time upon written notice to Goldman Sachs. If no
election is made, all dividends and capital gain distributions will be rein-
vested. Dividends will be reinvested as of the last calendar day of each
month. Cash distributions will be paid on or about the first business day of
each month. Net short-term capital gains, if any, will be distributed in ac-
cordance with the requirements of the Code and may be reflected in the Fund's
daily distributions. Each Fund may distribute at least annually its long-term
capital gains, if any, after reduction by available capital losses. In order
to avoid excessive fluctuations in the amount of monthly capital gains distri-
butions, a portion of any net capital gains realized on the disposition of se-
curities during the months of November and
29
<PAGE>
December may be distributed during the subsequent calendar year. Although re-
alized gains and losses on the assets of a Fund are reflected in the net asset
value of the Fund, they are not expected to be of an amount which would affect
the Fund's net asset value of $1.00 per share.
The income declared as a dividend for the Treasury Obligations, Government
and Premium Money Market Funds is based on estimates of net investment income
for each Fund. Actual income may differ from estimates, and differences, if
any, will be included in the calculation of subsequent dividends.
A Fund's net investment income consists of the excess of (i) accrued inter-
est or discount (including both original issue and market discount on taxable
securities) on portfolio securities, and (ii) any income of the Fund from
sources other than capital gains over (iii) the amortization of market premium
on all portfolio securities and (iv) the estimated expenses of the Fund, in-
cluding a proportionate share of the general expenses of the Trust.
EXCHANGES
FST Service Shares of each Fund may be exchanged by Service Organizations
for shares of the corresponding class of any Fund or Portfolio of Goldman
Sachs Trust at the net asset value next determined either by writing to
Goldman Sachs, Attention: Shareholder Services, Goldman Sachs Trust, 4900
Sears Tower, Chicago, Illinois 60606 or, if previously elected in the Account
Information Form, by calling Goldman Sachs at 800-621-2550. All telephone ex-
changes must be registered in the same name(s) and with the same address as
are registered in the Fund from which the exchange is being made. It may be
difficult to implement the telephone exchange privilege in times of drastic
economic or market changes. In an effort to prevent unauthorized or fraudulent
exchange requests by telephone, Goldman Sachs employs reasonable procedures as
set forth under "Redemption of Shares" to confirm that such instructions are
genuine. Exchanges are available only in states where the exchange may legally
be made. The exchange privilege may be modified or withdrawn at any time on 60
days' written notice.
REDEMPTION OF SHARES
HOW TO REDEEM
Customers of Service Organizations may redeem FST Service Shares of a Fund
through their respective Service Organizations. The Service Organizations are
responsible for the transmittal of redemption requests by their customers to
Goldman Sachs. In order to facilitate timely transmittal of redemption re-
quests, Service Organizations have established procedures by which redemption
requests must be made and times by which redemption requests must be received
by them. Additional documentation may be required when deemed appropriate by a
Service Organization.
A Service Organization may redeem such Shares without charge upon request on
any Business Day at the net asset value next determined after receipt by
Goldman Sachs of the redemption request. Redemption requests may be made by
telephoning Goldman Sachs at 800-621-2550 or by a written request addressed to
Goldman Sachs, Attention: Shareholder Services, Goldman Sachs Trust, 4900
Sears Tower, Chicago, Illinois 60606. A Service Organization may request re-
demptions by telephone only if the optional telephone redemption privilege has
been elected on the Account Information Form. It may be difficult to implement
redemptions by telephone in times of drastic economic or market changes.
In an effort to prevent unauthorized or fraudulent redemption requests by
telephone, Goldman Sachs employs reasonable procedures specified by the Trust
to confirm that such instructions are genuine. Among other things, any redemp-
tion request that requires money to go to an account or address other than
that designated on the Account Information Form must be in writing and signed
by an authorized person designated on the Account Information Form. Any such
written request is also confirmed by telephone with both the requesting party
and the designated bank account to verify instructions. Other procedures may
be implemented from time to time. If
30
<PAGE>
reasonable procedures are not implemented, the Trust may be liable for any
loss due to unauthorized or fraudulent transactions. In all other cases, nei-
ther the Trust nor Goldman Sachs will be responsible for the authenticity of
redemption instructions received by telephone. A redemption may also be made
with respect to certain Funds by means of the check redemption privilege de-
scribed in the Statement of Additional Information. Goldman Sachs reserves the
right to redeem accounts with balances below $500.
Additional documentation may be required by Goldman Sachs in order to estab-
lish that a redemption request has been properly authorized. A redemption re-
quest will not be considered to have been received in proper form until such
additional documentation has been submitted to Goldman Sachs by the Service
Organization. The payment of redemption proceeds for FST Service Shares re-
cently purchased by check will be delayed for up to 15 days until the check
has cleared.
PAYMENT OF REDEMPTION PROCEEDS AND DIVIDENDS
In accordance with the following, redemption proceeds will be wired to the
record holder of FST Service Shares.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
REDEMPTION REQUEST RECEIVED
FROM SERVICE ORGANIZATION REDEMPTION PROCEEDS
BY GOLDMAN SACHS ORDINARILY DIVIDENDS
--------------------------- ------------------- ---------
<S> <C> <C>
(1) Taxable and Tax-Advantaged Funds (except Government,
Treasury Obligations and Premium Money Market Funds)
By:3:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------------
After:3:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By:5:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------------
After:5:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------------
(3) Municipal Fund
By:12:00 noon--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------------
After:12:00 noon--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By:1:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------------
After:1:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------------
</TABLE>
31
<PAGE>
The Funds will arrange for the proceeds of redemptions effected by any means
to be wired as federal funds to the Service Organization's bank account desig-
nated in the Account Information Form. Redemption proceeds will normally be
wired as set forth above, but may be paid up to three Business Days after re-
ceipt of the Service Organization's properly executed redemption request. For
example, payment may be delayed if the Federal Reserve Bank is closed on the
day redemption proceeds would ordinarily be wired. After a wire has been ini-
tiated by Goldman Sachs, neither Goldman Sachs nor the Trust assumes any fur-
ther responsibility for the performance of intermediaries or the FST Service
Shareholder's Service Organization in the transfer process. If a problem with
such performance arises, the FST Service Shareholder should deal directly with
such intermediaries or Service Organization.
OTHER REDEMPTION INFORMATION
A minimum account balance of $10 million is required to remain a FST Service
Shareholder. The Trust and Goldman Sachs each reserves the right to waive the
minimum account balance. The Trust reserves the right to redeem shares of a
shareholder account if the balance is less than the minimum described above.
The Trust will give sixty (60) days' prior written notice to such shareholders
whose FST Service Shares are to be redeemed to allow them to purchase suffi-
cient additional FST Service Shares to avoid such redemption.
----------------
32
<PAGE>
APPENDIX
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON ACCOUNT INFORMATION FORM
You are required by law to provide the Fund with your correct Social Secu-
rity or other Taxpayer Identification Number (TIN), regardless of whether you
file tax returns. Failure to do so may subject you to penalties. Failure to
provide your correct TIN and to sign your name in the certification section of
the Account Information Form could result in withholding of 31% by the Fund
for the federal backup withholding tax on distributions, redemptions, ex-
changes and other payments relating to your account.
Any tax withheld may be credited against taxes owed on your federal income
tax return.
If you do not have a TIN, you should apply for one immediately by contacting
your local office of the Social Security Administration or the Internal Reve-
nue Service (IRS). Backup withholding could apply to payments relating to your
account prior to the Fund's receipt of your TIN.
Special rules apply for certain entities. For example, for an account estab-
lished under a Uniform Gifts or Transfers to Minors Act, the TIN of the minor
should be furnished.
If you have been notified by the IRS that you are subject to backup with-
holding because you failed to report all your interest and/or dividend income
on your tax return and you have not been notified by the IRS that such with-
holding should cease, you must cross out item (2) in the certification section
of the Account Information Form.
If you are an exempt recipient, you should furnish your TIN and certify your
exemption by signing the Certification section and writing "exempt" after your
signature. Exempt recipients include: corporations, tax-exempt pension plans
and IRA's, governmental agencies, financial institutions, registered securi-
ties and commodities dealers and others.
If you are a nonresident alien or foreign entity, you must provide a com-
pleted Form W-8 to the Fund in order to avoid backup withholding on certain
payments. Other payments to you may be subject to non-resident alien withhold-
ing of up to 30%.
For further information regarding backup and nonresident alien withholding,
see Sections 3406, 1441 and 1442 of the Internal Revenue Code and consult your
tax adviser.
A-1
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FST SERVICE SHARES
4900 SEARS TOWER
CHICAGO, ILLINOIS 60606
TOLL FREE: 800-621-2550
-----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Shareholder and Fund Expenses.............................................. 2
Financial Highlights....................................................... 4
An Introduction to the Funds............................................... 12
Investment Policies Matrix................................................. 14
Description of Securities and Investment
Techniques................................................................ 16
Investment Limitations..................................................... 21
Management................................................................. 22
Taxes...................................................................... 23
Net Asset Value............................................................ 25
Yield Information.......................................................... 25
Organization and Shares of the Trust....................................... 26
Additional Services........................................................ 27
Purchase of Shares......................................................... 27
Reports to Shareholders.................................................... 29
Distributions.............................................................. 29
Exchanges.................................................................. 30
Redemption of Shares....................................................... 30
Appendix................................................................... A-1
</TABLE>
FSPROSVCMM
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GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST SERVICE SHARES
-----------
PROSPECTUS
-----------
MANAGED BY
GOLDMAN SACHS ASSET MANAGEMENT
A SEPARATE OPERATING DIVISION OF
GOLDMAN, SACHS & CO.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST PREFERRED SHARES
4900 Sears Tower
Chicago, Illinois 60606
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management invest-
ment company (a "mutual fund") which includes the Financial Square Funds (the
"Funds"). This Prospectus relates only to the offering of FST Preferred shares
of beneficial interest ("FST Preferred Shares") of the Funds. Goldman Sachs
Asset Management, a separate operating division of Goldman, Sachs & Co.,
serves as each Fund's investment adviser. Goldman, Sachs & Co. serves as each
Fund's distributor and transfer agent.
The following Funds seek to maximize current income to the extent consistent
with the preservation of capital and the maintenance of liquidity by investing
exclusively in high quality money market instruments. The Funds may invest in
diversified portfolios of the following types of instruments:
Financial Square Prime Obligations Fund. Securities of the U.S. Government,
its agencies, authorities and instrumentalities, obligations of U.S. banks,
commercial paper and other short-term obligations of U.S. companies, states,
municipalities and other entities, and repurchase agreements.
Financial Square Money Market Fund. Securities of the U.S. Government, its
agencies, authorities and instrumentalities, U.S. dollar denominated obliga-
tions of U.S. and foreign banks, U.S. dollar denominated commercial paper and
other short-term obligations of U.S. and foreign companies, foreign govern-
ments, states, municipalities and other entities, and repurchase agreements.
Financial Square Premium Money Market Fund. Securities of the U.S. Govern-
ment, its agencies, authorities and instrumentalities, U.S. dollar denominated
obligations of U.S. and foreign banks, U.S. dollar denominated commercial pa-
per and other short-term obligations of U.S. and foreign companies, foreign
governments, states, municipalities and other entities, and repurchase agree-
ments. In order to obtain a rating from a rating organization, the Fund will
observe special investment restrictions.
Financial Square Treasury Obligations Fund. Securities issued or guaranteed
by the U.S. Treasury and repurchase agreements relating to such securities.
Financial Square Treasury Instruments Fund. Securities issued or guaranteed
by the U.S. Treasury, the interest income from which is generally exempt from
state income taxation.
Financial Square Government Fund. Securities of the U.S. Government, its
agencies, authorities, and instrumentalities, and repurchase agreements relat-
ing to such securities.
Financial Square Federal Fund. Securities of the U.S. Government and certain
of its agencies, authorities and instrumentalities, the interest income from
which is generally exempt from state income taxation.
Financial Square Tax-Free Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes and
not an item of tax preference under the federal alternative minimum tax.
Financial Square Municipal Money Market Fund. Securities issued by or on be-
half of states, territories and possessions of the United States and their po-
litical subdivisions, agencies, authorities and instrumentalities, and the
District of Columbia, the interest from which, if any, is, in the opinion of
bond counsel, excluded from gross income for federal income tax purposes (but
not necessarily exempt from federal alternative minimum tax or state and local
taxes).
AN INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOV-
ERNMENT AND THERE CAN BE NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER SHARE.
- -------------------------------------------------------------------------------
ADDITIONAL INFORMATION..............Goldman Sachs Funds-Toll Free: 800-621-2550
This Prospectus provides you with information about the Funds that you should
know before investing in FST Preferred Shares. It should be read and retained
for future reference. If you would like more detailed information, the State-
ment of Additional Information dated September 5, 1997, as amended or supple-
mented from time to time, is available upon request without charge from Serv-
ice Organizations, as defined herein, or by calling the telephone number
listed above or by writing Goldman Sachs, Attention: Shareholder Services,
Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois 60606. The Statement
of Additional Information, which is incorporated by reference into this Pro-
spectus, has been filed with the Securities and Exchange Commission. Not all
Funds are available in certain states. Please call the phone number listed
above to determine availability in your state. The SEC maintains a Web site
(http://www.sec.gov) that contains the Statement of Additional Information and
other information regarding the Trust.
- -------------------------------------------------------------------------------
FST PREFERRED SHARES OF THE FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUAR-
ANTEED OR ENDORSED BY, ANY BANK OR OTHER INSURED DEPOSITORY INSTITUTION, AND
ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RE-
SERVE BOARD OR ANY OTHER GOVERNMENT AGENCY. AN INVESTMENT IN A FUND INVOLVES
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE AC-
CURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is September 5, 1997.
<PAGE>
SHAREHOLDER AND FUND EXPENSES
FST PREFERRED SHARES
<TABLE>
<CAPTION>
FINANCIAL FINANCIAL FINANCIAL
FINANCIAL FINANCIAL SQUARE FINANCIAL FINANCIAL SQUARE SQUARE
SQUARE SQUARE PREMIUM SQUARE SQUARE FINANCIAL FINANCIAL TAX-FREE MUNICIPAL
PRIME MONEY MONEY TREASURY TREASURY SQUARE SQUARE MONEY MONEY
OBLIGATIONS MARKET MARKET OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MARKET MARKET
FUND FUND FUND FUND FUND FUND FUND FUND FUND
----------- --------- --------- ----------- ----------- ---------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSAC-
TION EXPENSES
Maximum Sales Charge
Imposed on
Purchases........... None None None None None None None None None
Sales Charge Imposed
on Reinvested
Distributions....... None None None None None None None None None
Deferred Sales Load
Imposed on
Redemptions......... None None None None None None None None None
Exchange Fee......... None None None None None None None None None
ANNUAL OPERATING EXPENSES
(1)
(as a percentage of
average daily net
assets)
Management Fees
(after
limitations) (2).... 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17% 0.17%
Other Expenses
Preferred Adminis-
tration Fees....... 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%
Other Expenses
(after expense
limitation) (3).... 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01%
---- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL OPERATING
EXPENSES (4)......... 0.28% 0.28% 0.28% 0.28% 0.28% 0.28% 0.28% 0.28% 0.28%
==== ==== ==== ==== ==== ==== ==== ==== ====
</TABLE>
EXAMPLE OF EXPENSES
You would pay the following expenses on a hypothetical $1,000 investment, as-
suming a 5% annual return and redemption at the end of each time period:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
Financial Square Prime Obligations Fund... $ 3 $9 $16 $36
Financial Square Money Market Fund........ $ 3 $ 9 $16 $36
Financial Square Premium Money Market
Fund..................................... $ 3 $ 9 N/A N/A
Financial Square Treasury Obligations
Fund..................................... $ 3 $ 9 $16 $36
Financial Square Treasury Instruments
Fund..................................... $ 3 $ 9 N/A N/A
Financial Square Government Fund.......... $ 3 $ 9 $16 $36
Financial Square Federal Fund............. $ 3 $ 9 N/A N/A
Financial Square Tax-Free Money Market
Fund..................................... $ 3 $ 9 $16 $36
Financial Square Municipal Money Market
Fund..................................... $ 3 $ 9 N/A N/A
</TABLE>
2
<PAGE>
- --------
(1) Based on estimated amounts for the current fiscal year for the Financial
Square Premium Money Market, Financial Square Treasury Instruments, Finan-
cial Square Federal and Financial Square Municipal Money Market Funds.
(2) The Investment Adviser has voluntarily agreed not to impose 0.035% of its
management fee for each Fund. Without such limitation, management fees for
each Fund would be 0.205%.
(3) The Investment Adviser has voluntarily agreed to reduce or limit certain
other expenses (excluding management fees, fees payable to Service Organi-
zations, as defined herein, taxes, interest and brokerage and litigation,
indemnification and other extraordinary expenses) to the extent such ex-
penses exceed 0.01% of a Fund's average daily net assets.
(4) Without the limitations described above, "Other Expenses" and "Total Oper-
ating Expenses" of the Financial Square Prime Obligations, Financial
Square Money Market, Financial Square Treasury Obligations, Financial
Square Government and Financial Square Tax-Free Money Market Funds for the
semi annual period ended June 30, 1997, would have been as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Prime Obligations Fund................... .025% .33%
Financial Square Money Market Fund........................ .025% .33%
Financial Square Treasury Obligations Fund................ .035% .34%
Financial Square Government Fund.......................... .015% .32%
Financial Square Tax-Free Money Market Fund............... .015% .32%
</TABLE>
In addition, without the limitations described above, "Other Expenses" and
"Total Operating Expenses" of the Financial Square Premium Money Market, Fi-
nancial Square Treasury Instruments, Financial Square Federal and Financial
Square Municipal Money Market Funds for the current fiscal year are estimated
to be as follows:
<TABLE>
<CAPTION>
TOTAL
OTHER OPERATING
EXPENSES EXPENSES
-------- ---------
<S> <C> <C>
Financial Square Premium Money Market Fund................ .035% .34%
Financial Square Treasury Instruments Fund................ .155% .46%
Financial Square Federal Fund............................. .155% .46%
Financial Square Municipal Money Market Fund.............. .285% .59%
</TABLE>
The information set forth in the foregoing table and hypothetical example
relates only to FST Preferred Shares of the Funds. The Funds also offer FST
Shares, FST Administration Shares and FST Service Shares. The other classes of
the Funds are subject to different fees and expenses (which affect perfor-
mance) and are entitled to different services. Information regarding any other
class of the Funds may be obtained from your sales representative or from
Goldman Sachs by calling the number on the front cover of this Prospectus.
Service Organizations may charge other fees to their customers who are the
beneficial owners of FST Preferred Shares in connection with their customers'
accounts. See "Administration." Such fees, if any, may affect the return such
customers realize with respect to their investments.
The purpose of the foregoing table is to assist investors in understanding
the various fees and expenses of a Fund that an investor will bear directly or
indirectly. The information on fees and expenses included in the table and the
hypothetical example above are based on each Fund's fees and expenses (actual
or estimated) and should not be considered as representative of past or future
expenses. Actual fees and expenses may be greater or less than those indicat-
ed. Moreover, while the example assumes a 5% annual return, a Fund's actual
performance will vary and may result in an actual return greater or less than
5%. See "Management--Investment Adviser."
3
<PAGE>
FINANCIAL HIGHLIGHTS
The following data with respect to a share (of the class specified) of the
Financial Square Prime Obligations, Financial Square Money Market, Financial
Square Treasury Obligations, Financial Square Government and Financial Square
Tax-Free Money Market Funds outstanding during the periods ended on or prior
to December 31, 1996 have been audited by Arthur Andersen LLP, independent
public accountants, whose report, which appears in the annual report to share-
holders of the Funds for the fiscal year ended December 31, 1996 (the "Annual
Report") is incorporated by reference into and attached to the Statement of
Additional Information. The following data for each of the above referenced
funds along with the Financial Square Treasury Instruments and Financial
Square Federal Funds for the period ended June 30, 1997 is unaudited, and de-
rived from financial statements included in the semi-annual report to share-
holders of the Fund for the period ended June 30, 1997, (the "Semi-Annual Re-
port"). The Annual Report and the Semi-Annual Report should be read in con-
junction with the financial statements and related notes incorporated by ref-
erence and attached to the Statement of Additional Information.
Financial Square Municipal Money Market and Financial Square Premium Money
Market Funds had no operations during the periods shown. Accordingly, there
are no selected per share data and ratios presented for these Funds.
4
<PAGE>
Goldman Sachs Trust--Financial Square Funds
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FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding Throughout Each Period
Prime Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET EXPENSES TO INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT AVERAGE INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0267 $ -- $0.0267 $(0.0267) $1.00 5.53%(b) 0.18%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0262 -- 0.0262 (0.0262) 1.00 5.42(b) 0.28(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0255 -- 0.0255 (0.0255) 1.00 5.27(b) 0.43(b) 5.15(b)
1997-FST Service
shares.......... 1.00 0.0243 -- 0.0243 (0.0243) 1.00 5.00(b) 0.68(b) 4.90(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0529 -- 0.0529 (0.0529) 1.00 5.41 0.18 5.29
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0346 -- 0.0346 (0.0346) 1.00 5.28(b) 0.28(b) 5.19(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0506 -- 0.0506 (0.0506) 1.00 5.14 0.43 5.06
1996-FST Service
shares.......... 1.00 0.0478 -- 0.0478 (0.0478) 1.00 4.88 0.68 4.78
1995-FST shares. 1.00 0.0586 -- 0.0586 (0.0586) 1.00 6.02 0.18 5.86
1995-FST Admin-
istration
shares.......... 1.00 0.0559 -- 0.0559 (0.0559) 1.00 5.75 0.43 5.59
1995-FST Service
shares.......... 1.00 0.0533 -- 0.0533 (0.0533) 1.00 5.49 0.68 5.33
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0401 -- 0.0401 (0.0401) 1.00 4.38(b) 0.18(b) 4.38(b)
1994-FST Admin-
istration
shares(d)....... 1.00 0.0383 -- 0.0383 (0.0383) 1.00 4.12(b) 0.43(b) 4.18(b)
1994-FST Service
shares(d)....... 1.00 0.0364 -- 0.0364 (0.0364) 1.00 3.86(b) 0.68(b) 3.98(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0311 0.0002 0.0313 (0.0313) 1.00 3.18 0.17 3.11
1994-FST Admin-
istration
shares.......... 1.00 0.0286 0.0002 0.0288 (0.0288) 1.00 2.92 0.42 2.86
1994-FST Service
shares.......... 1.00 0.0261 0.0002 0.0263 (0.0263) 1.00 2.66 0.67 2.61
1993-FST shares. 1.00 0.0360 0.0007 0.0367 (0.0367) 1.00 3.75 0.18 3.60
1993-FST Admin-
istration
shares(e)....... 1.00 0.0068 0.0001 0.0069 (0.0069) 1.00 3.02(b) 0.44(b) 2.96(b)
1993-FST Service
shares.......... 1.00 0.0301 0.0007 0.0308 (0.0308) 1.00 3.23 0.68 3.01
1992-FST shares. 1.00 0.0572 0.0002 0.0574 (0.0574) 1.00 5.99 0.18 5.72
1992-FST Service
shares(e)....... 1.00 0.0027 -- 0.0027 (0.0027) 1.00 4.10(b) 0.66(b) 4.10(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0727 -- 0.0727 (0.0727) 1.00 8.27(b) 0.18(b) 8.04(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $3,813,081 0.23%(b) 5.34%(b)
1997-FST Pre-
ferred Shares... 240,047 0.33(b) 5.26(b)
1997-FST Admin-
istration
shares.......... 295,977 0.48(b) 5.10(b)
1997-FST Service
shares.......... 121,165 0.73(b) 4.85(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 3,901,797 0.23 5.24
1996-FST Pre-
ferred
shares(c)....... 127,126 0.33(b) 5.14(b)
1996-FST Admin-
istration
shares.......... 215,898 0.48 5.01
1996-FST Service
shares.......... 115,154 0.73 4.73
1995-FST shares. 3,295,791 0.22 5.82
1995-FST Admin-
istration
shares.......... 147,894 0.47 5.55
1995-FST Service
shares.......... 65,278 0.72 5.29
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 2,774,849 0.24(b) 4.32(b)
1994-FST Admin-
istration
shares(d)....... 66,113 0.49(b) 4.12(b)
1994-FST Service
shares(d)....... 41,372 0.74(b) 3.92(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1,831,413 0.25 3.03
1994-FST Admin-
istration
shares.......... 35,250 0.50 2.78
1994-FST Service
shares.......... 14,001 0.75 2.53
1993-FST shares. 813,126 0.25 3.53
1993-FST Admin-
istration
shares(e)....... 1,124 0.52(b) 2.88(b)
1993-FST Service
shares.......... 336 0.75 2.94
1992-FST shares. 917,073 0.27 5.63
1992-FST Service
shares(e)....... 118 0.74(b) 4.02(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 578,495 0.28(b) 7.94(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
(e) FST Administration share and FST Service share activity commenced during
November of 1992 and January of 1992, respectively.
(f) Commencement of operations.
5
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $1.00 $0.0269 $ -- $0.0269 $(0.0269) $1.00 5.57%(b) 0.18%(b) 5.44%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0264 -- 0.0264 (0.0264) 1.00 5.46(b) 0.28(b) 5.36(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0257 -- 0.0257 (0.0257) 1.00 5.30(b) 0.43(b) 5.18(b)
1997-FST Service
shares.......... 1.00 0.0244 -- 0.0244 (0.0244) 1.00 5.04(b) 0.68(b) 4.93(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 1.00 0.0533 0.0001 0.0534 (0.0534) 1.00 5.45 0.18 5.33
1996-FST
Preferred
shares(c)....... 1.00 0.0348 -- 0.0348 (0.0348) 1.00 5.31(b) 0.28(b) 5.23(b)
1996-FST
Administration
shares.......... 1.00 0.0504 0.0001 0.0505 (0.0505) 1.00 5.19 0.43 5.04
1996-FST Service
shares.......... 1.00 0.0484 -- 0.0484 (0.0484) 1.00 4.93 0.68 4.84
1995-FST shares. 1.00 0.0589 -- 0.0589 (0.0589) 1.00 6.07 0.15 5.89
1995-FST
Administration
shares.......... 1.00 0.0561 -- 0.0561 (0.0561) 1.00 5.80 0.40 5.61
1995-FST Service
shares(d)....... 1.00 0.0231 -- 0.0231 (0.0231) 1.00 5.41(b) 0.65(b) 4.93(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 1.00 0.0305 -- 0.0305 (0.0305) 1.00 4.91(b) 0.11(b) 4.88(b)
1994-FST
Administration
shares(d)....... 1.00 0.0298 -- 0.0298 (0.0298) 1.00 4.65(b) 0.36(b) 4.82(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ----------------------
1997-FST
shares.......... $3,992,002 0.23%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 43,759 0.33(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 276,152 0.48(b) 5.13(b)
1997-FST Service
shares.......... 290,345 0.73(b) 4.88(b)
FOR THE YEARS ENDED DECEMBER 31,
- ----------------
1996-FST shares. 2,540,366 0.23 5.28
1996-FST
Preferred
shares(c)....... 17,510 0.33(b) 5.18(b)
1996-FST
Administration
shares.......... 165,766 0.48 4.99
1996-FST Service
shares.......... 234,376 0.73 4.79
1995-FST shares. 2,069,197 0.23 5.81
1995-FST
Administration
shares.......... 137,412 0.48 5.53
1995-FST Service
shares(d)....... 4,219 0.73(b) 4.85(b)
FOR THE PERIOD ENDED
DECEMBER 31,
- --------------------
1994-FST
shares(d)....... 862,971 0.25(b) 4.74(b)
1994-FST
Administration
shares(d)....... 66,560 0.50(b) 4.68(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST, FST Administration and FST Service share activity commenced May 18,
1994, May 20, 1994 and July 14, 1995, respectively.
6
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL RATIO OF NET INVESTMENT
VALUE AT NET GAIN (LOSS) INCOME FROM DISTRIBUTIONS NET ASSET EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS END OF PERIOD RETURN(A) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0262 $0.0001 $0.0263 $(0.0263) $1.00 5.43%(b) 0.18%(b) 5.28%(b)
1997-FST Pre-
ferred shares .. 1.00 0.0257 0.0001 0.0258 (0.0258) 1.00 5.32(b) 0.28(b) 5.18(b)
1997-FST Admin-
istration shares
................. 1.00 0.0249 0.0001 0.0250 (0.0250) 1.00 5.16(b) 0.43(b) 5.03(b)
1997-FST Service
shares ......... 1.00 0.0237 0.0001 0.0238 (0.0238) 1.00 4.90(b) 0.68(b) 4.78(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 1.00 0.0522 0.0003 0.0525 (0.0524) 1.00 5.35 0.18 5.22
1996-FST
Preferred
shares(c)....... 1.00 0.0342 0.0001 0.0343 (0.0343) 1.00 5.24(b) 0.28(b) 5.11(b)
1996-FST
Administration
shares.......... 1.00 0.0497 0.0002 0.0499 (0.0498) 1.00 5.09 0.43 4.97
1996-FST Service
shares.......... 1.00 0.0472 0.0002 0.0474 (0.0474) 1.00 4.83 0.68 4.72
1995-FST shares. 1.00 0.0573 0.0005 0.0578 (0.0578) 1.00 5.96 0.18 5.73
1995-FST
Administration
shares.......... 1.00 0.0547 0.0005 0.0552 (0.0552) 1.00 5.69 0.43 5.47
1995-FST Service
shares.......... 1.00 0.0521 0.0005 0.0526 (0.0526) 1.00 5.43 0.68 5.21
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 1.00 0.0379 (0.0001) 0.0378 (0.0378) 1.00 4.23(b) 0.18(b) 4.13(b)
1994-FST
Administration
shares(d)....... 1.00 0.0388 (0.0001) 0.0387 (0.0387) 1.00 3.97(b) 0.43(b) 4.24(b)
1994-FST Service
shares(d)....... 1.00 0.0349 (0.0001) 0.0348 (0.0348) 1.00 3.71(b) 0.68(b) 3.82(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 1.00 0.0301 0.0007 0.0308 (0.0307) 1.00 3.11 0.17 3.01
1994-FST
Administration
shares.......... 1.00 0.0276 0.0006 0.0282 (0.0281) 1.00 2.85 0.42 2.76
1994-FST Service
shares.......... 1.00 0.0251 0.0008 0.0259 (0.0256) 1.00 2.60 0.67 2.51
1993-FST shares. 1.00 0.0342 0.0012 0.0354 (0.0355) 1.00 3.69 0.18 3.42
1993-FST
Administration
shares(e) ...... 1.00 0.0009 -- 0.0009 (0.0009) 1.00 2.83(b) 0.43(b) 2.83(b)
1993-FST Service
shares.......... 1.00 0.0296 0.0016 0.0312 (0.0309) 1.00 3.17 0.68 2.96
1992-FST shares. 1.00 0.0549 0.0015 0.0564 (0.0561) 1.00 5.84 0.18 5.49
1992-FST Service
shares(e)....... 1.00 0.0113 0.0006 0.0119 (0.0116) 1.00 4.47(b) 0.68(b) 3.77(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 1.00 0.0600 0.0006 0.0606 (0.0605) 1.00 8.06(b) 0.21(b) 7.74(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $2,140,063 0.24%(b) 5.22%(b)
1997-FST Pre-
ferred shares .. 2,826 0.34(b) 5.12(b)
1997-FST Admin-
istration shares
................. 638,287 0.49(b) 4.97(b)
1997-FST Service
shares ......... 232,548 0.74(b) 4.72(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST shares. 2,291,051 0.24 5.16
1996-FST
Preferred
shares(c)....... 46,637 0.34(b) 5.05(b)
1996-FST
Administration
shares.......... 536,895 0.49 4.91
1996-FST Service
shares.......... 220,560 0.74 4.66
1995-FST shares. 1,587,715 0.23 5.68
1995-FST
Administration
shares.......... 283,186 0.48 5.42
1995-FST Service
shares.......... 139,117 0.73 5.16
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares(d)....... 958,196 0.25(b) 4.06(b)
1994-FST
Administration
shares(d)....... 82,124 0.50(b) 4.17(b)
1994-FST Service
shares(d)....... 81,162 0.75(b) 3.75(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST shares. 812,420 0.24 2.94
1994-FST
Administration
shares.......... 24,485 0.49 2.69
1994-FST Service
shares.......... 35,656 0.74 2.44
1993-FST shares. 776,181 0.26 3.34
1993-FST
Administration
shares(e) ...... 1 0.51(b) 2.75(b)
1993-FST Service
shares.......... 5,155 0.76 2.88
1992-FST shares. 413,171 0.28 5.39
1992-FST Service
shares(e)....... 3,634 0.78(b) 3.67(b)
FOR THE PERIOD MARCH 8, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST shares. 229,988 0.34(b) 7.61(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
(e)FST Administration and FST Service share activity commenced during January
of 1993 and October of 1991, respectively.
(f)Commencement of operations.
7
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Instruments Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $1.00 $ 0.0168 0.0002 $ 0.0170 $(0.0170) $1.00 5.29%(b) 0.18%(b) 5.12%(b)
1997-FST Pre-
ferred shares
(c)............. 1.00 0.0043 0.0002 0.0045 (0.0045) 1.00 5.19(b) 0.28(b) 5.04(b)
1997-FST Admin-
istration shares
(c)............. 1.00 0.0122 0.0002 0.0124 (0.0124) 1.00 5.06(b) 0.43(b) 4.89(b)
1997-FST Service
shares (c)...... 1.00 0.0150 0.0002 0.0152 (0.0152) 1.00 4.73(b) 0.68(b) 4.63(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET
ASSETS AT RATIO OF NET
END RATIO OF INVESTMENT
OF PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------
1997-FST
shares(c)....... $237,444 0.36%(b) 4.94%(b)
1997-FST Pre-
ferred shares
(c)............. 2 0.46(b) 4.86(b)
1997-FST Admin-
istration shares
(c)............. 1,132 0.61(b) 4.71(b)
1997-FST Service
shares (c)...... 35,901 0.86(b) 4.45(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the
investment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Share, FST Preferred Share, FST Administration Share, and FST Service
Share activity commenced March 3, 1997, May 30, 1997, April 1, 1997, and
March 5, 1997, respectively.
8
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Government Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
----------------------------------------
NET ASSET TOTAL
VALUE AT NET NET REALIZED GAIN INCOME FROM DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO VALUE AT END TOTAL
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... $1.00 $ 0.0264 $0.0001 $ 0.0265 $(0.0265) $1.00 5.47%(b)
1997-FST Preferred
shares............... 1.00 0.0259 0.0001 0.0260 (0.0260) 1.00 5.37(b)
1997-FST Administra-
tion shares.......... 1.00 0.0251 0.0001 0.0252 (0.0252) 1.00 5.21(b)
1997-FST Service
shares............... 1.00 0.0239 0.0001 0.0240 (0.0240) 1.00 4.95(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 1.00 0.0525 0.0001 0.0526 (0.0526) 1.00 5.38
1996-FST Preferred
shares(c)............ 1.00 0.0344 0.0001 0.0345 (0.0345) 1.00 5.26(b)
1996-FST Administra-
tion shares.......... 1.00 0.0501 0.0001 0.0502 (0.0502) 1.00 5.12
1996-FST Service
shares............... 1.00 0.0474 0.0001 0.0475 (0.0475) 1.00 4.86
1995-FST shares...... 1.00 0.0581 0.0001 0.0582 (0.0582) 1.00 6.00
1995-FST Administra-
tion shares.......... 1.00 0.0554 0.0001 0.0555 (0.0555) 1.00 5.74
1995-FST Service
shares(d)............ 1.00 0.0320 -- 0.0320 (0.0320) 1.00 5.40(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 1.00 0.0424 -- 0.0424 (0.0424) 1.00 4.36(b)
1994-FST Administra-
tion shares(e)....... 1.00 0.0426 -- 0.0426 (0.0426) 1.00 4.10(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 1.00 0.0256 0.0001 0.0257 (0.0257) 1.00 3.14(b)
1993-FST Administra-
tion shares(d)....... 1.00 0.0120 0.0001 0.0121 (0.0121) 1.00 2.87(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET RATIO OF NET
RATIO OF NET INVESTMENT NET RATIO OF INVESTMENT
EXPENSES TO INCOME TO ASSETS AT END EXPENSES TO INCOME TO
AVERAGE NET AVERAGE NET OF PERIOD AVERAGE NET AVERAGE NET
ASSETS ASSETS (IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST shares...... 0.18%(b) 5.33%(b) $1,222,437 0.22%(b) 5.29%(b)
1997-FST Preferred
shares............... 0.28(b) 5.32(b) 48,896 0.32(b) 5.28(b)
1997-FST Administra-
tion shares.......... 0.43(b) 5.07(b) 190,742 0.47(b) 5.03(b)
1997-FST Service
shares............... 0.68(b) 4.83(b) 603,520 0.72(b) 4.79(b)
FOR THE YEARS ENDED
DECEMBER 31,
- -------------------
1996-FST shares...... 0.18 5.25 858,769 0.24 5.19
1996-FST Preferred
shares(c)............ 0.28(b) 5.14(b) 112 0.34(b) 5.08(b)
1996-FST Administra-
tion shares.......... 0.43 5.01 145,108 0.49 4.95
1996-FST Service
shares............... 0.68 4.74 223,554 0.74 4.68
1995-FST shares...... 0.18 5.81 743,884 0.24 5.75
1995-FST Administra-
tion shares.......... 0.43 5.54 82,386 0.49 5.48
1995-FST Service
shares(d)............ 0.68(b) 5.08(b) 14,508 0.74(b) 5.02(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST shares(e)... 0.15(b) 4.64(b) 258,350 0.25(b) 4.54(b)
1994-FST Administra-
tion shares(e)....... 0.40(b) 4.67(b) 54,253 0.50(b) 4.57(b)
FOR THE PERIOD ENDED
JANUARY 31,
- --------------------
1993-FST shares(d)... 0.08(b) 3.10(b) 44,697 0.59(b) 2.59(b)
1993-FST Administra-
tion shares(d)....... 0.35(b) 2.85(b) 14,126 0.76(b) 2.44(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the invest-
ment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced April 6, 1993, September 1, 1993 and May 16, 1995, respectively.
(e) The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of
the funds as a series of Goldman Sachs Money Market Trust.
9
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Federal Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-----------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN ON INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $1.00 $ 0.0178 -- $ 0.0178 $ (0.0178) $1.00 5.47%(b) 0.18%(b) 5.36%(b)
1997-FST Pre-
ferred
shares(c)....... 1.00 0.0047 -- 0.0047 (0.0047) 1.00 5.46(b) 0.28(b) 5.28(b)
1997-FST Admin-
istration
shares(c)....... 1.00 0.0128 -- 0.0128 (0.0128) 1.00 5.25(b) 0.43(b) 5.17(b)
1997-FST Service
shares(c)....... 1.00 0.0131 -- 0.0131 (0.0131) 1.00 4.99(b) 0.68(b) 4.90(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
NET EXPENSE LIMITATIONS
ASSETS -------------------------
AT END RATIO OF NET
OF RATIO OF INVESTMENT
PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $714,024 0.36%(b) 5.18%(b)
1997-FST Pre-
ferred
shares(c)....... 2 0.46(b) 5.10(b)
1997-FST Admin-
istration
shares(c)....... 137,933 0.61(b) 4.99(b)
1997-FST Service
shares(c)....... 122,323 0.86(b) 4.72(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST share, FST Preferred share, FST Administration share, and FST Service
share activity commenced February 28, 1997, May 30, 1997, April 1, 1997 and
March 25, 1997, respectively.
10
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Tax-Free Money Market Fund
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET NET TOTAL
ASSET NET REALIZED INCOME NET ASSET RATIO OF NET
VALUE AT INVEST- GAIN ON FROM DISTRIBUTIONS VALUE AT EXPENSES TO
BEGINNING MENT INVESTMENT INVESTMENT TO END OF TOTAL AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS PERIOD RETURN (A) ASSETS
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $ 0.0170 -- $ 0.0170 $(0.0170) $1.00 3.49%(b) 0.18%(b)
1997-FST Pre-
ferred shares... 1.00 0.0165 -- 0.0165 (0.0165) 1.00 3.39(b) 0.28(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0158 -- 0.0158 (0.0158) 1.00 3.23(b) 0.43(b)
1997-FST Service
shares.......... 1.00 0.0146 -- 0.0146 (0.0146) 1.00 2.97(b) 0.68(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 1.00 0.0335 -- 0.0335 (0.0335) 1.00 3.39 0.18
1996-FST Pre-
ferred
shares(c)....... 1.00 0.0218 -- 0.0218 (0.0218) 1.00 3.30(b) 0.28(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0310 -- 0.0310 (0.0310) 1.00 3.13 0.43
1996-FST Service
shares.......... 1.00 0.0285 -- 0.0285 (0.0285) 1.00 2.88 0.68
1995-FST shares. 1.00 0.0381 -- 0.0381 (0.0381) 1.00 3.89 0.14
1995-FST Admin-
istration
shares.......... 1.00 0.0354 -- 0.0354 (0.0354) 1.00 3.63 0.39
1995-FST Service
shares.......... 1.00 0.0332 -- 0.0332 (0.0332) 1.00 3.38 0.64
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 1.00 0.0156 -- 0.0156 (0.0156) 1.00 3.41(b) 0.07(b)
1994-FST
Administration shares(d). 1.00 0.0136 -- 0.0136 (0.0136) 1.00 3.19(b) 0.32(b)
1994-FST Service
shares(d)....... 1.00 0.0091 -- 0.0091 (0.0091) 1.00 3.11(b) 0.57(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
RATIO OF NET NET RATIO OF NET
INVESTMENT ASSETS AT RATIO OF INVESTMENT
INCOME TO END OF EXPENSES TO INCOME TO
AVERAGE NET PERIOD AVERAGE NET AVERAGE NET
ASSETS (IN 000'S) ASSETS ASSETS
-------------------------------------------------
<S> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... 3.46%(b) $731,783 0.22%(b) 3.42%(b)
1997-FST Pre-
ferred shares... 3.24(b) 5,468 0.32(b) 3.20(b)
1997-FST Admin-
istration
shares.......... 3.25(b) 96,496 0.47(b) 3.21(b)
1997-FST Service
shares.......... 2.94(b) 27,597 0.72(b) 2.90(b)
FOR THE YEARS
ENDED DECEMBER
31,
- --------------
1996-FST shares. 3.35 440,838 0.23 3.30
1996-FST Pre-
ferred
shares(c)....... 3.26(b) 28,731 0.33(b) 3.21(b)
1996-FST Admin-
istration
shares.......... 3.10 51,661 0.48 3.05
1996-FST Service
shares.......... 2.85 19,855 0.73 2.80
1995-FST shares. 3.81 448,367 0.24 3.71
1995-FST Admin-
istration
shares.......... 3.54 20,939 0.49 3.44
1995-FST Service
shares.......... 3.32 19,860 0.74 3.22
FOR THE PERIOD
ENDED DECEMBER
31,
- --------------
1994-FST
shares(d)....... 3.42(b) 183,570 0.31(b) 3.18(b)
1994-FST
Administration shares(d). 3.25(b) 2,042 0.56(b) 3.01(b)
1994-FST Service
shares(d)....... 3.32(b) 2,267 0.81(b) 3.08(b)
</TABLE>
- --------------
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST Preferred share activity commenced on May 1, 1996.
(d) FST share, FST Administration share and FST Service share activity com-
menced July 19, 1994, August 1, 1994 and September 23, 1994, respectively.
11
<PAGE>
AN INTRODUCTION TO THE FUNDS
THE TRUST: The Trust is a no-load, open-end, management investment company
registered under the Investment Company Act of 1940, as amended (the "Invest-
ment Company Act"). Each Fund is a separate pool of assets which pursues its
investment objective through separate investment policies, as described below.
THE ADVISER: Goldman Sachs Asset Management, a separate operating division
of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds' investment ad-
viser (the "Adviser" or "GSAM").
THE DISTRIBUTOR: Goldman Sachs, which serves as the Funds' distributor and
transfer agent, is one of the largest international investment banking and
brokerage firms in the United States.
THE INVESTORS: The Funds are designed for institutional investors seeking a
high rate of return, a stable net asset value and convenient liquidation priv-
ileges. The Funds are particularly suitable for banks, corporations and other
financial institutions that seek investment of short-term funds for their own
accounts or for the accounts of their customers. Shares of the Government Fund
are intended to qualify as eligible investments for Federally chartered credit
unions pursuant to Sections 107(7), 107(8) and 107(15) of the Federal Credit
Union Act, Part 703 of the National Credit Union Administration ("NCUA") Rules
and Regulations and NCUA Letter Number 155. The Fund intends to review changes
in the applicable laws, rules and regulations governing eligible investments
for federally chartered credit unions, and to take such action as may be nec-
essary so that the investments of the Fund qualify as eligible investments un-
der the Federal Credit Union Act and the regulations thereunder. Shares of the
Government Fund, however, may or may not qualify as eligible investments for
particular state chartered credit unions. State chartered credit unions should
consult qualified legal counsel to determine whether the Government Fund is a
permissible investment under the law applicable to it.
THE FUNDS: Each Fund's securities are valued by the amortized cost method as
permitted by a rule ("Rule 2a-7") of the Securities and Exchange Commission
("SEC"). Under such rule, each Fund may invest only in securities that are de-
termined to present minimal credit risk and meet certain other criteria.
TAXABLE FUNDS: Prime Obligations, Money Market, Premium Money Market,
Treasury Obligations and Government Funds.
TAX ADVANTAGED FUNDS: Treasury Instruments and Federal Funds.
TAX-EXEMPT FUNDS: Tax-Free Money Market and Municipal Money Market Funds.
INVESTMENT OBJECTIVES AND POLICIES FOR TAXABLE, TAX-ADVANTAGED AND TAX-
EXEMPT FUNDS: To maximize current income to the extent consistent with the
preservation of capital and the maintenance of liquidity by investing ex-
clusively in high quality money market instruments. In order to obtain a
rating from a rating organization, the Premium Money Market Fund will ob-
serve special investment restrictions. The Treasury Instruments and Federal
Funds pursue their objectives by limiting their investments to certain U.S.
Treasury Obligations and U.S. Government Securities (each as defined here-
in), respectively, the interest from which is generally exempt from state
income taxation. Each investor should consult his or her tax adviser to de-
termine whether distributions from the Treasury Instruments and Federal
Funds (and any other Fund that may hold such obligations) derived from in-
terest on such obligations are exempt from state income taxation in the in-
vestor's own state.
NET ASSET VALUE: Each Fund seeks to maintain a stable net asset value of
$1.00 per share.
MAXIMUM REMAINING MATURITY OF PORTFOLIO INVESTMENTS: Thirteen months at the
time of purchase.
12
<PAGE>
DOLLAR-WEIGHTED AVERAGE PORTFOLIO MATURITY ("WAM"): Not more than ninety
days as required by Rule 2a-7.
FIRST TIER SECURITIES: Each Fund may purchase securities which are rated (or
that have been issued by an issuer that is rated with respect to a class of
short-term debt obligations, or any security within that class, comparable in
priority and quality with such securities) in the highest short-term rating
category by at least two NRSROs (as defined below), or if only one NRSRO has
assigned a rating, by that NRSRO. U.S. Government Securities as defined herein
are considered First Tier Securities.
SECOND TIER SECURITIES: The Tax-Exempt Funds may purchase securities which
are not First Tier Securities but which are rated in the top two short-term
rating categories by at least two NRSROs, or if only one NRSRO has assigned a
rating, by that NRSRO. The Taxable Funds will not invest in a security which
is a Second Tier Security at the time of purchase.
UNRATED SECURITIES: To the extent permitted by Rule 2a-7, unrated securities
may be purchased if they are deemed to be of comparable quality to First Tier
Securities, or to the extent that a Fund may purchase Second Tier Securities,
comparable in quality to Second Tier Securities.
NRSROS: Nationally Recognized Statistical Rating Organizations include Stan-
dard & Poor's Ratings Group ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Fitch Investors Services, Inc., Duff and Phelps, Inc., IBCA Lim-
ited and its affiliate IBCA Inc., and Thomson BankWatch, Inc. For a descrip-
tion of each NRSRO's rating categories, see Appendix A to the Statement of Ad-
ditional Information.
13
<PAGE>
INVESTMENT POLICIES MATRIX
<TABLE>
<CAPTION>
SHORT-TERM
OBLIGATIONS OF ASSET-BACKED & FOREIGN
US US CORPORATIONS RECEIVABLES- GOVERNMENT
TREASURY GOVERNMENT BANK COMMERCIAL AND OTHER REPURCHASE BACKED OBLIGATIONS
FUND OBLIGATIONS SECURITIES OBLIGATIONS PAPER ENTITIES AGREEMENTS SECURITIES+ (US$)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Prime Obligations [_] [_] [_] [_] [_] [_] [_]
U.S. banks U.S. entities
only only
- ------------------------------------------------------------------------------------------------------------------------
Money Market [_] [_] [_] [_] [_] [_] [_] [_]
Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Premium Money [_] [_] [_] [_] [_] [_] [_] [_]
Market Over 25% of U.S. and U.S. and
total assets foreign foreign
must be (US$) (US$)
invested in commercial entities
US and paper
Foreign (US$)
Banks
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_] [_]
Obligations
- ------------------------------------------------------------------------------------------------------------------------
Treasury [_]
Instruments
- ------------------------------------------------------------------------------------------------------------------------
Government [_] [_] [_]
- ------------------------------------------------------------------------------------------------------------------------
Federal [_] [_] (Does not
intend to
invest)
- ------------------------------------------------------------------------------------------------------------------------
Tax-Free Money [_]
Market Tax-exempt
only
- ------------------------------------------------------------------------------------------------------------------------
Municipal Money [_]
Market Tax-exempt
only
</TABLE>
Note: See "Description of Securities and Investment Techniques" for a descrip-
tion of, and certain criteria applicable to, each of these categories of
investments.
+To the extent required by Rule 2a-7, asset-backed and receivables-backed
securities will be rated by the requisite number of NRSROs.
14
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
SUMMARY OF
TAXABLE TAX-EXEMPT CREDIT INVESTMENT UNRATED TAXATION FOR
MUNICIPALS MUNICIPALS QUALITY**** COMPANIES SECURITIES DISTRIBUTIONS* MISCELLANEOUS
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
[_] First [_] [ ] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
[_] First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
[_]
First [_] [_] Taxable May invest in
Tier Up to 10% of federal and obligations of
total assets state** the
in other International
investment Bank for
companies Reconstruction
and Development
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets state**
in other
investment
companies
- ---------------------------------------------------------------------------------------------------
First [_] Taxable
Tier Up to 10% of federal and
total assets generally
in other exempt from
investment state taxation
companies
- ---------------------------------------------------------------------------------------------------
First [_]
Tier Up to 10% of Taxable
total assets federal and
in other state**
investment
companies
- ---------------------------------------------------------------------------------------------------
Under
First [_] Taxable extraordinary
Tier Up to 10% of federal and circumstances,
total assets generally may hold cash,
in other exempt from U.S. Government
investment state taxation Securities
companies subject to state
taxation or cash
equivalents
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May (but does
At least 80% of Second Up to 10% of federal and not currently
net assets in Tier total assets taxable intend to)
Municipal in other state*** invest up to 20%
Instruments investment in AMT
(except in companies securities and
extraordinary may temporarily
circumstances) invest in the
taxable money
market
instruments
described herein
- ---------------------------------------------------------------------------------------------------
[_] First or [_] [_] Tax-exempt May invest up to
At least 80% of Second Up to 10% of federal and 100% in AMT
net assets in Tier total assets taxable securities and
Municipal in other state*** may temporarily
Instruments investment invest in the
(except in companies taxable money
extraordinary market
circumstances) instruments
described herein
- ---------------------------------------------------------------------------------------------------
</TABLE>
* See "Taxes" below for an explanation of the tax consequences summarized
in the table above.
** Taxable in many states except for distributions from U.S. Treasury obli-
gation interest income and certain U.S. Government securities interest
income.
*** Taxable except for distributions from interest on obligations of an in-
vestor's state of residence in certain states.
**** To the extent permitted by Rule 2a-7, a Fund holding a security fully
supported by a guarantee may substitute the credit quality of the guaran-
tee in determining the credit quality of the security.
15
<PAGE>
DESCRIPTION OF SECURITIES AND INVESTMENT TECHNIQUES
U.S. TREASURY OBLIGATIONS
"U.S. Treasury Obligations" are securities issued or guaranteed by the U.S.
Treasury, payments of principal and interest on which are backed by the full
faith and credit of the U.S. Government.
U.S. GOVERNMENT SECURITIES
"U.S. Government Securities" are obligations issued or guaranteed by the
U.S. Government, its agencies, authorities or instrumentalities. Unlike U.S.
Treasury Obligations, securities issued or guaranteed by U.S. Government agen-
cies, authorities or instrumentalities are supported either by (a) the full
faith and credit of the U.S. Government (such as securities of the Government
National Mortgage Association), (b) the right of the issuer to borrow from the
Treasury (such as securities of the Student Loan Marketing Association), (c)
the discretionary authority of the U.S. Government to purchase the agency's
obligations (such as securities of the Federal National Mortgage Association
and the Federal Home Loan Mortgage Corporation), or (d) only the credit of the
issuer. No assurance can be given that the U.S. Government will provide finan-
cial support to U.S. Government agencies, authorities or instrumentalities in
the future. U.S. Government Securities may include zero coupon bonds. Such
bonds may be purchased when yields are attractive.
Securities guaranteed as to principal and interest by the U.S. Government,
its agencies, authorities or instrumentalities are deemed to include (a) secu-
rities for which the payment of principal and interest is backed by an irrevo-
cable letter of credit issued by the U.S. Government, its agencies, authori-
ties or instrumentalities and (b) participations in loans made to foreign gov-
ernments or their agencies that are so guaranteed. The secondary market for
certain of these participations is limited. Such participations may therefore
be regarded as illiquid.
Each Fund may also invest in separately traded principal and interest compo-
nents of securities guaranteed or issued by the U.S. Treasury if such compo-
nents are traded independently under the Separate Trading of Registered Inter-
est and Principal of Securities program ("STRIPS").
The Treasury Instruments and Federal Funds invest in U.S. Treasury Obliga-
tions and the Federal Fund may also invest in certain U.S. Government Securi-
ties the interest from which is generally exempt from state income taxation.
Securities generally eligible for this exemption include those issued by the
U.S. Treasury and those issued by certain agencies, authorities or instrumen-
talities of the U.S. Government, including the Federal Home Loan Banks, Fed-
eral Farm Credit Banks, Tennessee Valley Authority and the Student Loan Mar-
keting Association.
CUSTODIAL RECEIPTS
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may also acquire securities issued or guaranteed as
to principal and interest by the U.S. Government, its agencies, authorities or
instrumentalities in the form of custodial receipts that evidence ownership of
future interest payments, principal payments or both on certain notes or bonds
issued by the U.S. Government, its agencies, authorities or instrumentalities.
For certain securities law purposes, custodial receipts are not considered ob-
ligations of the U.S. Government.
U.S. AND FOREIGN BANK OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "U.S. Bank Obligations" limited to securities issued or guaranteed by
U.S. banks (including certificates of deposit, commer -
16
<PAGE>
cial paper, unsecured bank promissory notes and bankers' acceptances) which
have more than $1 billion in total assets at the time of purchase. Such obli-
gations may also include debt obligations issued by U.S. subsidiaries of such
banks.
The Money Market and Premium Money Market Funds may also invest in "Foreign
Bank Obligations" limited to U.S. dollar-denominated obligations issued or
guaranteed (including fixed time deposits) by foreign banks which have more
than $1 billion in total assets at the time of purchase, U.S. branches of such
foreign banks (Yankee obligations), foreign branches of such foreign banks and
foreign branches of U.S. banks having more than $1 billion in total assets at
the time of purchase. Such bank obligations may be general obligations of the
parent bank or may be limited to the issuing branch by the terms of the spe-
cific obligations or by government regulation.
The Money Market and Premium Money Market Funds will invest more than 25% of
their total assets in bank obligations (whether foreign or domestic), includ-
ing bank commercial paper. However, if adverse economic conditions prevail in
the banking industry (such as substantial losses on loans, increases in non-
performing assets and charge-offs and declines in total deposits) the Funds
may, for defensive purposes, temporarily invest less than 25% of their total
assets in bank obligations. As a result, the Funds may be especially affected
by favorable and adverse developments in or related to the banking industry.
The activities of U.S. banks and most foreign banks are subject to comprehen-
sive regulations which, in the case of U.S. regulations, have undergone sub-
stantial changes in the past decade. The enactment of new legislation or regu-
lations, as well as changes in interpretation and enforcement of current laws,
may affect the manner of operations and profitability of domestic and foreign
banks. Significant developments in the U.S. banking industry have included de-
regulation of interest rates, increased competition from other types of finan-
cial institutions, increased acquisition activity, geographic expansion and,
during the late 1980's, an increased number of bank failures. Banks may be
particularly susceptible to certain economic factors, such as interest rate
changes and adverse developments in the market for real estate. Fiscal and
monetary policy and general economic cycles can affect the availability and
cost of funds, loan demand and asset quality and thereby impact the earnings
and financial conditions of banks. See "Foreign Government Obligations--For-
eign Risks" below.
COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Commercial Paper" (including variable amount master demand notes and
asset-backed commercial paper) which is payable in U.S. dollars and is issued
or guaranteed by U.S. corporations, U.S. commercial banks, foreign corpora-
tions (Money Market and Premium Money Market Funds only), foreign commercial
banks (Money Market and Premium Money Market Funds only) or other entities. In
addition, the Funds may invest in other short-term obligations (including
short-term funding agreements) payable in U.S. dollars and issued or guaran-
teed by U.S. corporations, foreign corporations (Money Market and Premium
Money Market Funds only) or other entities.
ASSET-BACKED AND RECEIVABLES-BACKED SECURITIES
The Prime Obligations, Money Market and Premium Money Market Funds may in-
vest in "Asset-Backed and Receivables-Backed Securities" which represent par-
ticipations in, or are secured by and payable from, pools of assets such as
motor vehicle installment sale contracts, installment loan contracts, leases
of various types of real and personal property, receivables from revolving
credit (credit card) agreements and other categories of receivables. Such as-
set pools are securitized through the use of privately-formed trusts or spe-
cial purpose corporations. Payments or distributions of principal and interest
may be guaranteed up to certain amounts and
17
<PAGE>
for a certain time period by a letter of credit or a pool insurance policy is-
sued by a financial institution, or other credit enhancements may be present.
To the extent consistent with its investment objectives and policies, each of
the Prime Obligations, Money Market and Money Market Plus Funds may invest in
new types of mortgage-related securities and in other asset-backed securities
that may be developed in the future.
FOREIGN GOVERNMENT OBLIGATIONS
The Money Market and Premium Money Market Funds may invest in U.S. dollar-
denominated obligations (limited to commercial paper and other notes) issued
or guaranteed by a foreign government or any entity located or organized in a
foreign country that maintains a short-term foreign currency rating in the
highest short-term ratings category by the requisite number of NRSROs. The
Money Market and Premium Money Market Funds may not invest more than 25% of
their total assets in the securities of any one foreign government.
FOREIGN RISKS. Investments in foreign securities and bank obligations may
present a greater degree of risk than investments in securities of domestic
issuers because of less publicly-available financial and other information,
less securities regulation, potential imposition of foreign withholding and
other taxes, war, expropriation or other adverse governmental actions. Foreign
banks and their foreign branches are not regulated by U.S. banking authori-
ties, and generally are not bound by the accounting, auditing and financial
reporting standards applicable to U.S. banks.
MUNICIPAL OBLIGATIONS
MUNICIPAL INSTRUMENTS. Obligations issued by or on behalf of states, terri-
tories and possessions of the United States and their political subdivisions,
agencies, authorities and instrumentalities, and the District of Columbia, the
interest from which is, in the opinion of bond counsel, if any, excluded from
gross income for federal income tax purposes.
TYPES OF MUNICIPAL INSTRUMENTS:
<TABLE>
<CAPTION>
TAX-FREE MONEY MARKET AND
MUNICIPAL MONEY MARKET FUNDS
-------------------------------------------------------------------------
<S> <C>
FIXED RATE NOTES AND SIMILAR In highest short-term or one of the
DEBT INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
VARIABLE AND FLOATING RATE In highest short-term or one of the
DEMAND INSTRUMENTS two highest long-term rating
categories
-------------------------------------------------------------------------
TAX-EXEMPT COMMERCIAL PAPER In highest rating category
-------------------------------------------------------------------------
MUNICIPAL BONDS In one of the two highest rating
categories
-------------------------------------------------------------------------
UNRATED NOTES, PAPER, BONDS AND Determined to be of comparable quality
OTHER INSTRUMENTS by Adviser pursuant to criteria
approved by the Trustees
</TABLE>
18
<PAGE>
As a matter of fundamental policy, at least 80% of each of the Tax-Free
Money Market and Municipal Money Market Fund's net assets will ordinarily be
invested in Municipal Instruments. Each Tax-Exempt Fund may temporarily invest
in taxable money market instruments when the Adviser believes that the market
conditions dictate a defensive posture. Investments in taxable money market
instruments will be limited to those meeting the quality standards of each
Tax-Exempt Fund. The Prime Obligations, Money Market and Premium Money Market
Funds may invest in short-term obligations issued or guaranteed by state and
municipal governments when yields on such securities are attractive compared
to other taxable investments.
MUNICIPAL NOTES AND BONDS. Municipal notes include tax anticipation notes
("TANs"), revenue anticipation notes ("RANs"), bond anticipation notes
("BANs"), tax and revenue anticipation notes ("TRANs") and construction loan
notes. Municipal bonds include general obligation bonds and revenue bonds.
General obligation bonds are backed by the taxing power of the issuing munici-
pality and are considered the safest type of bonds. Revenue bonds are backed
by the revenues of a project or facility such as the tolls from a toll bridge.
Revenue bonds also include lease rental revenue bonds which are issued by a
state or local authority for capital projects and are secured by annual lease
payments from the state or locality sufficient to cover debt service on the
authority's obligations. Industrial development bonds (generally referred to
under current tax law as "private activity bonds") are a specific type of rev-
enue bond backed by the credit and security of a private user and therefore
have more potential risk. Municipal bonds may be issued in a variety of forms,
including commercial paper, tender option bonds and variable and floating rate
securities.
TENDER OPTION BONDS. A tender option bond is a Municipal Instrument (gener-
ally held pursuant to a custodial arrangement) having a relatively long matu-
rity and bearing interest at a fixed rate substantially higher than prevailing
short-term, tax-exempt rates. The bond is typically issued in conjunction with
the agreement of a third party, such as a bank, broker-dealer or other finan-
cial institution, pursuant to which such institution grants the security
holder the option, at periodic intervals, to tender its securities to the in-
stitution and receive the face value thereof. As consideration for providing
the option, the financial institution receives periodic fees equal to the dif-
ference between the bond's fixed coupon rate and the rate, as determined by a
remarketing or similar agent at or near the commencement of such period, that
would cause the securities, coupled with the tender option, to trade at par on
the date of such determination. Thus, after payment of this fee, the security
holder effectively holds a demand obligation that bears interest at the pre-
vailing short-term, tax-exempt rate. However, an institution will not be obli-
gated to accept tendered bonds in the event of certain defaults or a signifi-
cant downgrading in the credit rating assigned to the issuer of the bond. The
tender option will be taken into account in determining the maturity of the
tender option bonds and a Fund's average portfolio maturity. There is a risk
that a Fund will not be considered the owner of a tender option bond for fed-
eral income tax purposes and thus will not be entitled to treat such interest
as exempt from federal income tax.
REVENUE ANTICIPATION WARRANTS. Revenue Anticipation Warrants ("RAWs") are
issued in anticipation of the issuer's receipt of revenues and present the
risk that such revenues will be insufficient to satisfy the issuer's payment
obligations. The entire amount of principal and interest on RAWs is due at ma-
turity. RAWs, including those with a maturity of more than 397 days, may also
be repackaged as instruments which include a demand feature that permits the
holder to sell the RAWs to a bank or other financial institution at a purchase
price equal to par plus accrued interest on each interest rate reset date.
FLOATING AND VARIABLE RATE OBLIGATIONS. The value of floating and variable
rate obligations generally is more stable than that of fixed rate obligations
in response to changes in interest rate levels. Variable and floating rate ob-
ligations usually have demand features that permit the Funds to sell them at
par value plus accrued interest
19
<PAGE>
upon short notice. The issuers or financial intermediaries providing demand
features may support their ability to purchase the obligations by obtaining
credit with liquidity supports. These may include lines of credit, which are
conditional commitments to lend and letters of credit, which will ordinarily
be irrevocable, both of which may be issued by domestic banks or foreign banks
which have a branch, agency or subsidiary in the United States. When consider-
ing whether an obligation meets a Fund's quality standards, the Fund will, to
the extent permitted by Rule 2a-7, look to the creditworthiness of the party
providing unconditional demand features or other unconditional obligations to
support the credit of the issuer of the security. A Fund may consider the ma-
turity of a variable or floating rate Municipal Instrument to be shorter than
its ultimate stated maturity if the Fund has the right to demand prepayment of
its principal at specified intervals prior to the security's ultimate stated
maturity, subject to the conditions for using amortized cost valuation under
the Investment Company Act. A Fund may purchase such variable or floating rate
obligations from the issuers or may purchase certificates of participation, a
type of floating or variable rate obligation, which are interests in a pool of
debt obligations held by a bank or other financial institution.
INDUSTRIAL DEVELOPMENT BONDS. The Funds (other than the Treasury Obliga-
tions, Treasury Instruments, Government and Federal Funds) may invest in in-
dustrial development bonds (generally referred to under current tax law as
"private activity bonds"), the interest from which would be an item of tax
preference when distributed as "exempt-interest dividends" to shareholders un-
der the federal alternative minimum tax. See "Taxes" and "Distributions." Mu-
nicipal Fund may invest up to 100% of its assets in private activity bonds.
Tax-Free Fund does not currently intend to invest in such bonds. If Tax-Free
Fund's policy not to invest in private activity bonds should change in the fu-
ture, shareholders would be notified and such investments would not exceed 20%
of Tax-Free Fund's net assets.
OTHER POLICIES. Ordinarily the Tax-Exempt Funds expect that 100% of their
portfolio securities will be Municipal Instruments. However, the Funds may
hold cash or invest in short-term taxable securities as set forth above. Such
Funds may invest 25% or more of the value of their respective total assets in
Municipal Instruments which are related in such a way that an economic, busi-
ness or political development or change affecting one Municipal Instrument
would also affect the other Municipal Instruments. For example, the Tax-Exempt
Funds may invest all of their respective assets in (a) Municipal Instruments
the interest on which is paid solely from revenues from similar projects such
as hospitals, electric utility systems, multi-family housing, nursing homes,
commercial facilities (including hotels), steel companies or life care facili-
ties, (b) Municipal Instruments whose issuers are in the same state or (c) in-
dustrial development obligations. Concentration of a Fund's investments in
these Municipal Instruments will subject the Fund, to a greater extent than if
such investment was more limited, to the risks of adverse economic, business
or political developments affecting any such state, industry or other area of
concentration.
Each Fund (other than the Treasury Obligations, Treasury Instruments, Gov-
ernment and Federal Funds) may purchase Municipal Instruments which are backed
by letters of credit, which will ordinarily be irrevocable, issued by domestic
banks or foreign banks (excluding Prime Obligations Fund) which have a branch,
agency or subsidiary in the United States. In addition, these Funds may ac-
quire securities in the form of custodial receipts which evidence ownership of
future interest payments, principal payments or both on obligations of certain
state and local governments and authorities.
In order to enhance the liquidity, stability, or quality of a Municipal In-
strument, each Fund (other than the Treasury Obligations, Treasury Instru-
ments, Government and Federal Funds) may acquire the right to sell the secu-
rity to another party at a guaranteed price and date.
20
<PAGE>
REPURCHASE AGREEMENTS
Each Fund (other than the Treasury Instruments Fund) may only enter into re-
purchase agreements with primary dealers in U.S. Government Securities. A re-
purchase agreement is an agreement under which a Fund purchases securities and
the seller agrees to repurchase the securities within a particular time at a
specified price. Such price will exceed the original purchase price, the dif-
ference being income to the Fund, and will be unrelated to the interest rate
on the purchased security. A Fund's custodian or sub-custodian will maintain
custody of the purchased securities for the duration of the agreement. The
value of the purchased securities, including accrued interest, will at all
times equal or exceed the value of the repurchase agreement. In the event of
bankruptcy of the seller or failure of the seller to repurchase the securities
as agreed, a Fund could suffer losses, including loss of interest on or prin-
cipal of the security and costs associated with delay and enforcement of the
repurchase agreement. In evaluating whether to enter into a repurchase agree-
ment, the Adviser will carefully consider the creditworthiness of the seller
pursuant to procedures reviewed and approved by the Trustees. Distributions of
the income from repurchase agreements entered into by a Fund will be taxable
to its shareholders. In addition, each Fund, together with other registered
investment companies having management agreements with the Adviser or any of
its affiliates, may transfer uninvested cash balances into a single joint ac-
count, the daily aggregate balance of which will be invested in one or more
repurchase agreements.
FORWARD COMMITMENTS AND WHEN-ISSUED SECURITIES
Each Fund may purchase when-issued securities and make contracts to purchase
or sell securities for a fixed price at a future date beyond customary settle-
ment time. A Fund is required to hold and maintain in a segregated account
with the Fund's custodian or sub-custodian until three days prior to settle-
ment date, cash or liquid assets in an amount sufficient to meet the purchase
price. Alternatively, a Fund may enter into offsetting contracts for the for-
ward sale of other securities that it owns. Securities purchased or sold on a
when-issued or forward commitment basis involve a risk of loss if the value of
the security to be purchased declines prior to the settlement date or if the
value of the security to be sold increases prior to the settlement date. Al-
though a Fund would generally purchase securities on a when-issued or forward
commitment basis with the intention of acquiring securities for its portfolio,
the Fund may dispose of a when-issued security or forward commitment prior to
settlement if the Adviser deems it appropriate to do so.
OTHER INVESTMENT COMPANIES
The Adviser will determine, under guidelines established by the Trustees,
whether securities issued by other money market investment companies present
minimal credit risks. The amount of each Fund's investments in securities of
other investment companies will be subject to the limitations on such invest-
ments prescribed by the Investment Company Act. These limits include a prohi-
bition on any Fund acquiring more than 3% of the voting shares of any other
investment company and a prohibition on investing more than 5% of a Fund's to-
tal assets in securities of any one investment company or more than 10% of its
total assets in securities of all investment companies. Each Fund will indi-
rectly bear its proportionate share of any management fees and other expenses
paid by such other investment companies. Such other investment companies will
have investment objectives, policies and restrictions substantially similar to
those of the acquiring Fund and will be subject to substantially the same
risks.
INVESTMENT LIMITATIONS
TAXABLE AND TAX-EXEMPT FUNDS. Each Fund will comply with the conditions for
using amortized cost valuation set forth in Rule 2a-7 under the Investment
Company Act including, but not limited to, those condi-
21
<PAGE>
tions relating to maturity, diversification and credit quality. These operat-
ing policies may be more restrictive than the fundamental policies set forth
in the Statement of Additional Information.
INVESTMENT RESTRICTIONS. Each Fund is subject to certain investment restric-
tions that are described in detail under "Investment Restrictions" in the
Statement of Additional Information. Fundamental investment restrictions of a
Fund cannot be changed without approval of a majority of the outstanding
shares of that Fund. Treasury Obligations Fund's policy of limiting its in-
vestments to U.S. Treasury Obligations and related repurchase agreements is
also fundamental. All investment objectives and policies not specifically des-
ignated as fundamental are non-fundamental and may be changed without share-
holder approval.
RESTRICTED AND OTHER ILLIQUID SECURITIES. Each Fund may purchase securities
that are not registered ("restricted securities") under the Securities Act of
1933 ("1933 Act"), but can be offered and sold to "qualified institutional
buyers" under Rule 144A under the 1933 Act. However, a Fund will not invest
more than 10% of its net assets in illiquid investments, which include fixed
time deposits maturing in more than seven days and restricted securities.
Restricted securities (including commercial paper issued pursuant to Section
4(2) of the 1933 Act) which the Board of Trustees has determined are liquid,
based upon a continuing review of the trading markets for the specific re-
stricted security, will not be deemed to be illiquid investments for purposes
of this restriction. The Board of Trustees may adopt guidelines and delegate
to the Adviser the daily function of determining and monitoring the liquidity
of restricted securities. The Board, however, will retain sufficient oversight
and be ultimately responsible for the determinations. Since it is not possible
to predict with assurance that the market for restricted securities eligible
for resale under Rule 144A will continue to be liquid, the Adviser will care-
fully monitor each Fund's investments in these securities, focusing on such
important factors, among others, as valuation, liquidity and availability of
information. This investment practice could have the effect of increasing the
level of illiquidity in a Fund to the extent that qualified institutional buy-
ers become for a time uninterested in purchasing these restricted securities.
In addition, each Fund may not invest in repurchase agreements maturing in
more than seven days and securities which are not readily marketable if, as a
result thereof, more than 10% of the net assets of that Fund (taken at market
value) would be invested in such investments. Certain repurchase agreements
which mature in more than seven days can be liquidated before the nominal
fixed term on seven days or less notice. Such repurchase agreements will be
regarded as liquid instruments.
MANAGEMENT
THE ADVISER
GSAM, One New York Plaza, New York, New York 10004, a separate operating di-
vision of Goldman, Sachs & Co., acts as investment adviser to the Funds.
Goldman Sachs registered as an investment adviser in 1981. As of July , 1997,
Goldman Sachs, together with its affiliates, acted as investment adviser, ad-
ministrator or distributor for approximately $ billion in assets.
As of November 29, 1996, Goldman Sachs and its consolidated subsidiaries had
assets of approximately $152 billion and partners' capital of $5.3 billion and
ranked as one of the largest international investment banking and brokerage
firms in the United States. Founded in 1869, Goldman Sachs is a major invest-
ment banking and brokerage firm providing a broad range of financing and in-
vestment services both in the United States and abroad.
22
<PAGE>
Pursuant to an SEC order, each Taxable and Tax-Advantaged Fund may enter
into principal transactions in certain taxable money market instruments, in-
cluding repurchase agreements, with Goldman Sachs.
Under the Management Agreement, GSAM continually manages each Fund, includ-
ing the purchase, retention and disposition of its securities and other as-
sets. In addition, GSAM administers each Fund's business affairs and performs
various shareholder servicing functions to the extent not provided by other
organizations. The management of each Fund is subject to the supervision of
the Trustees and each Fund's investment policies. For these services, the
Trust, on behalf of each Fund, pays GSAM a monthly fee at an annual rate of
each Fund's average daily net assets as follows:
<TABLE>
<CAPTION>
FISCAL YEAR
ENDED
CONTRACTUAL DECEMBER 31,
RATE 1996
----------- ------------
<S> <C> <C>
Financial Square Prime Obligations Fund................ .205% .17%
Financial Square Money Market Fund..................... .205% .17%
Financial Square Premium Money Market Fund............. .205% N/A*
Financial Square Treasury Obligations Fund............. .205% .17%
Financial Square Treasury Instruments Fund............. .205% N/A*
Financial Square Government Fund....................... .205% .17%
Financial Square Federal Fund.......................... .205% N/A*
Financial Square Tax Free Money Market Fund............ .205% .17%
Financial Square Municipal Money Market Fund........... .205% N/A*
</TABLE>
* As of December 31, 1996, the Premium Money Market Fund, Treasury Instruments
Fund, Federal Fund and Municipal Money Market Fund had not commenced opera-
tions.
A Management Agreement combining both advisory and administrative services
was adopted effective April 30, 1997. The contractual rate set forth in the
table is the rate payable under the Management Agreement and is identical to
the aggregate advisory and administration fees payable by each Fund under the
previously separate investment advisory and administration agreements. For the
fiscal year ended December 31, 1996, the annual rate expressed is the combined
advisory and administration fees paid (after voluntary fee limitations). The
difference, if any, between the stated fees and the actual fees paid by the
Funds reflects the fact that the Investment Adviser did not charge the full
amount of the fees to which it would have been entitled.
GSAM has agreed not to impose a portion of its management fee and/or to re-
duce or otherwise limit the total operating expenses of each Fund (excluding
fees payable to Service Organizations, as defined herein, taxes, interest,
brokerage and litigation, indemnification and other extraordinary expenses).
GSAM has no current intention to but may in the future discontinue or modify
any of such reductions or limitations at its discretion.
THE DISTRIBUTOR AND TRANSFER AGENT
Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606, serves as the Dis-
tributor of shares of each Fund pursuant to a Distribution Agreement with the
Trust. The Distributor will assist in the sale of shares of each Fund upon the
terms described herein. Goldman Sachs also serves as the Transfer Agent of
each Fund.
From time to time, Goldman Sachs or any of its affiliates may purchase and
hold shares of the Funds in order to increase the assets of the Funds. In-
creasing the Fund's assets may enhance investment flexibility and diversifica-
tion. Goldman Sachs reserves the right to redeem at any time some or all of
the Fund shares acquired for its own account. Goldman Sachs will consider the
effect of redemptions on the Funds and other shareholders in deciding whether
to redeem its shares.
23
<PAGE>
TAXES
Each Fund is treated as a separate entity for federal tax purposes. The
Treasury Instruments and Federal Funds intend to elect and each other Fund has
elected to be treated as a regulated investment company and each Fund intends
to continue to qualify for such treatment under Subchapter M of the Internal
Revenue Code of 1986 (the "Code") for each taxable year. To qualify as such,
each Fund must satisfy certain requirements relating to the sources of its in-
come, diversification of its assets and distribution of its income to share-
holders. As a regulated investment company, each Fund will not be subject to
federal income or excise tax on any net investment income and net realized
capital gains that are distributed to its shareholders in accordance with cer-
tain timing requirements of the Code.
Dividends paid by a Fund from net investment income, the excess of net
short-term capital gain over net long-term capital loss and taxable original
issue discount or market discount income will be taxable to shareholders as
ordinary income, except for any "exempt-interest dividends" paid by the Tax-
Exempt Funds, as described below. Dividends paid by a Fund from the excess of
net long-term capital gain over net short-term capital loss will be taxable as
long-term capital gain regardless of how long the shareholders have held their
shares. These tax consequences will apply to distributions of any Fund
regardless of whether distributions are received in cash or reinvested in
shares. Certain distributions paid by the Funds in January of a given year
will be taxable to shareholders as if received on December 31 of the year in
which they are declared. Shareholders will be informed annually about the
amount and character of distributions received from the Funds for federal
income tax purposes, including any distributions that may constitute a return
of capital or any distributions of Municipal Fund that may constitute a tax
preference item under the federal alternative minimum tax.
The Tax-Exempt Funds intend to satisfy certain requirements of the Code for
the payment of "exempt-interest dividends" not included in shareholders' fed-
eral gross income. Dividends paid by these Funds from interest on tax-exempt
obligations and properly designated by the Funds as exempt-interest dividends,
including dividends attributable to exempt-interest dividends received by a
Fund from other regulated investment companies, will generally be exempt from
federal income tax, although a portion of such dividends may be subject to the
federal alternative minimum tax. Exempt-interest dividends will be considered
in computing the corporate federal alternative minimum tax, and the extent, if
any, to which social security or railroad retirement benefits are taxable.
Persons who are "substantial users" of facilities financed by certain indus-
trial development or private activity bonds should consult their own tax ad-
visers before purchasing shares of these Funds. Interest incurred to purchase
or carry shares of these Funds will not be deductible for federal income tax
purposes to the extent related to exempt-interest dividends paid by the Funds.
Individuals and certain other classes of shareholders may be subject to 31%
backup withholding of federal income tax on taxable distributions if they fail
to furnish their correct taxpayer identification number and certain certifica-
tions required by the Internal Revenue Service or if they are otherwise sub-
ject to backup withholding. Individuals, corporations and other shareholders
that are not U.S. persons under the Code are subject to different tax rules
and may be subject to nonresident alien withholding at the rate of 30% (or a
lower rate provided by an applicable tax treaty) on amounts treated as ordi-
nary dividends from the Funds.
If a Fund invests in foreign securities, it may be subject to foreign with-
holding or other foreign taxes on income earned on such securities and is ex-
pected to be unable to pass such taxes through to shareholders, who therefore
are not expected to include such taxes in income or be entitled to claim for-
eign tax credits or deductions with respect to such taxes.
In addition to federal taxes, a shareholder may be subject to state, local
or foreign taxes on payments received from a Fund. A state income (and possi-
bly local income and/or intangible property) tax exemption is
24
<PAGE>
generally available to the extent a Fund's distributions are derived from in-
terest on (or, in the case of intangible property taxes, the value of its as-
sets is attributable to) certain U.S. Government obligations and/or tax-exempt
municipal obligations issued by or on behalf of the particular state or a po-
litical subdivision thereof, provided in some states that certain thresholds
for holdings of such obligations and/or reporting requirements are satisfied.
Shareholders should consult their own tax advisers concerning these matters.
NET ASSET VALUE
The net asset value of each Fund (other than the Government, Treasury Obli-
gations and Money Market Plus Funds) is determined as of the close of regular
trading on the New York Stock Exchange (normally 4:00 p.m. New York time) on
each Business Day. The net asset value of Government, Treasury Obligations and
Money Market Plus Funds is determined as of 5:00 p.m. New York time on each
Business Day. Net asset value per share for each class of shares of each Fund
is calculated by determining the amount of net assets attributable to each
class of shares and dividing by the number of shares for such class.
On any Business Day, as defined herein, when the Public Securities Associa-
tion ("PSA") recommends that the securities markets close early, the Treasury
Instruments and Federal Funds will cease, and each other Fund reserves the
right to cease, accepting purchase and redemption orders for same Business Day
credit at the time PSA recommends that the securities markets close. On days
any Fund closes early, purchase and redemption orders received after the PSA
recommended closing time will be credited to the next Business Day. In addi-
tion, each Fund reserves the right to advance the time by which purchase and
redemption orders must be received for same Business Day credit as permitted
by the SEC.
Each Fund seeks to maintain a net asset value of $1.00 per share. In this
connection, each Fund values its portfolio securities on the basis of amor-
tized cost. The amortized cost method values a security at its cost on the
date of purchase and thereafter assumes a constant amortization to maturity of
any discount or premium, regardless of the impact of fluctuating interest
rates on the market value of the instrument. For a more complete description
of the amortized cost valuation method and its effect on existing and prospec-
tive shareholders, see the Statement of Additional Information. There can be
no assurance that a Fund will be able at all times to maintain a net asset
value per share of $1.00.
YIELD INFORMATION
From time to time, each Fund may advertise its yield, effective yield and
average annual total return. Average annual total return is determined by com-
puting the average annual percentage change in value of $1,000 invested at the
maximum public offering price for a specified period of at least one year, as-
suming reinvestment of all dividends and distributions at net asset value. The
total return calculation assumes a complete redemption of the investment at
the end of the relevant period. Each Fund may furnish total return calcula-
tions based on a cumulative, average, year-by-year or other basis for various
specified periods by means of quotations, charts, graphs or schedules. The
yield of a Fund refers to the income generated by an investment in that Fund
over a seven-day period (which period will be stated in the advertisement).
This income is then annualized; that is, the amount of income generated by the
investment during that week is assumed to be generated each week over a 52-
week period and is shown as a percentage of the investment. The effective
yield is calculated similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The effective yield will
be slightly higher than the yield because of the compounding effect of this
assumed reinvestment.
The Tax-Exempt Funds and the Federal and Treasury Instruments Funds may each
also quote tax-equivalent yield. Each Fund's tax-equivalent yield is calcu-
lated by determining the rate of return that would have to be
25
<PAGE>
achieved on a fully taxable investment to produce the after-tax equivalent of
the Fund's yield, assuming certain tax brackets for a shareholder.
Investors should note that the investment results of a Fund are based on
historical performance and will fluctuate over time. Any presentation of a
Fund's total return, yield, effective yield or tax-equivalent yield for any
prior period should not be considered a representation of what an investment
may earn or what a Fund's total return, yield, effective yield or tax-equiva-
lent yield may be in any future period. In addition to the above, each Fund
may from time to time advertise its performance relative to certain averages,
performance rankings, indices, other information prepared by recognized mutual
fund statistical services and investments for which reliable performance data
is available.
Total return, yield, effective yield and tax-equivalent yield will be calcu-
lated separately for each class of shares in existence. Because each such
class of shares is subject to different expenses, the total return and net
yield of such classes of a Fund for the same period may differ. See "Organiza-
tion and Shares of the Trust" below.
ORGANIZATION AND SHARES OF THE TRUST
Each Fund is a series of the Goldman Sachs Trust, which was formed under the
laws of the State of Delaware on January 28, 1997. The Funds were formerly se-
ries of Goldman Sachs Money Market Trust, a Massachusetts business trust, and
were reorganized into the Trust as of April 30, 1997. The Trustees have au-
thority under the Trust's Declaration of Trust to create and classify shares
of beneficial interest in separate series, without further action by share-
holders. Additional series may be added in the future. The Trustees also have
authority to classify or reclassify any series or portfolio of shares into one
or more classes. (Institutions that provide services to holders of FST Pre-
ferred Shares, FST Administration Shares or FST Service Shares are referred to
in this Prospectus as "Service Organizations").
When issued, shares are fully paid and nonassessable. In the event of liqui-
dation, shareholders are entitled to share pro rata in the net assets of the
applicable Fund available for distribution to such shareholders. All shares
are freely transferable and have no preemptive, subscription or conversion
rights. Shareholders are entitled to one vote per share, provided that, at the
option of the Trustees, shareholders will be entitled to a number of votes
based upon the net asset values represented by their shares.
Shares of a Fund will be voted seperately by Fund with respect to matters
pertaining to that Fund except for the election of Trustees and ratification
of independent accountants. For example, shareholders of each Fund are re-
quired to approve the adoption of any management agreement relating to that
Fund and any changes in fundamental investment restrictions or policies of
such Fund. Approval by the shareholders of one Fund is effective only as to
that Fund.
As of August 8, 1997, Harris Trust & Savings Bank, 200 W. Monroe St. Fl 12,
Chicago, IL 60606, owned of record 35.04% of the outstanding shares of Trea-
sury Instruments Fund and National City Bank, P.O. Box 5756, Cleveland, OH
44101-0756, owned of record 32.86% of the outstanding shares of Premium Money
Market Fund.
The Trust does not intend to hold annual meetings of shareholders. However,
pursuant to the Trust's By-Laws, the recordholders of at least 10% of the
shares outstanding and entitled to vote at a special meeting may require the
Trust to hold such special meeting of shareholders for any purpose, and
recordholders may, under certain circumstances, as permitted by the Investment
Company Act, communicate with other shareholders in connection with requiring
a special meeting of shareholders. The Trustees will call a special meeting of
shareholders for the purpose of electing Trustees if, at any time, less than a
majority of Trustees holding office at the time were elected by shareholders.
26
<PAGE>
ADMINISTRATION
Each Fund has adopted a Preferred Administration Plan with respect to the
FST Preferred Shares which authorizes it to compensate certain institutions
for providing account administration services to their customers who are bene-
ficial owners of such Shares (each a "Service Organization"). Each Fund will
enter into agreements with Service Organizations which purchase FST Preferred
Shares on behalf of their customers ("Service Agreements"). The Service Agree-
ments will provide for compensation to the Service Organization in an amount
up to .10% (on an annualized basis) of the average daily net asset value of
the FST Preferred Shares of that Fund attributable to or held in the name of
the Service Organization for its customers. The services provided by a Service
Organization may include acting, directly or through an agent, as the sole
shareholder of record, maintaining account records for its customers, and
processing orders to purchase, redeem and exchange FST Preferred Shares for
its customers.
For the fiscal year ended December 31, 1996, the Trust, on behalf of Prime
Obligations Fund, Money Market Fund, Treasury Obligations Fund, Government
Fund and Tax-Free Fund paid Service Organizations fees at the annual rate of
..10% of each Fund's average daily net assets attributable to FST Preferred Ad-
ministration Shares. As of December 31, 1996, the Premium Money Market Fund,
Treasury Instruments Fund, Federal Fund and Municipal Money Market Fund had
not commenced operations.
Holders of FST Preferred Shares of a Fund will bear all expenses and fees
paid to Service Organizations with respect to such Shares as well as any other
expenses which are directly attributable to such Shares.
Service Organizations may charge other fees to their customers who are the
beneficial owners of FST Preferred Shares in connection with their customer
accounts. These fees would be in addition to any amounts received by the Serv-
ice Organization under a Service Agreement and may affect an investor's return
with respect to an investment in a Fund.
All inquiries of beneficial owners of FST Preferred Shares of the Funds
should be directed to such owners' Service Organization.
PURCHASE OF SHARES
It is expected that all direct purchasers of FST Preferred Shares will be
Service Organizations or their nominees, which may purchase FST Preferred
Shares of the Funds through Goldman Sachs. Customers of Service Organizations
may invest in such shares only through their Service Organizations.
As set forth below, FST Preferred Shares of the Funds may be purchased on
any Business Day at the net asset value next determined after receipt from the
Service Organization of both the purchase order and the purchase amount in
federal funds. Purchase orders may be made by telephoning Goldman Sachs at
800-621-2550 or by a written request addressed to Goldman Sachs, Attention:
Shareholder Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois
60606. It is strongly recommended that payment be effected by wiring federal
funds to The Northern Trust Company ("Northern"), Chicago, Illinois, as the
sub-custodian for State Street Bank and Trust Company ("State Street").
Purchases of FST Preferred Shares may also be made by a Service Organization
by delivering a Federal Reserve draft or check (except that a third party
check will not be accepted) payable only to the appropriate Fund and drawn on
a U.S. bank to Goldman Sachs, Attention: Shareholder Services, Goldman Sachs
Trust, 4900
27
<PAGE>
Sears Tower, Chicago, Illinois 60606. It is expected that Federal Reserve
drafts will ordinarily be converted to federal funds on the day of receipt and
that checks will be converted to federal funds within two Business Days after
receipt. FST Preferred Shares purchased by check may not be redeemed until the
check has cleared, as described under "Redemption of Shares."
Purchases of shares of any Fund may also be made through an Automated Clear-
ing House ("ACH") transfer to Goldman Sachs Trust c/o Northern, as
subcustodian for State Street. Purchase orders are effected at the net asset
value next determined after receipt of both the purchase order and the pur-
chase amount in federal funds. It is expected that ACH transfers will ordinar-
ily be converted to federal funds on the Business Day following receipt of the
ACH transfer.
FST Preferred Shares of each Fund are deemed to have been purchased when an
order becomes effective and are entitled to dividends on FST Preferred Shares
purchased as follows:
- -------------------------------------------------------------------------------
IF ORDER IS RECEIVED FROM A SERVICE
ORGANIZATION BY GOLDMAN SACHS DIVIDENDS BEGIN
----------------------------------- ---------------
(1) Taxable and Tax-Advantaged Funds
(except Government, Treasury
Obligations and Premium Money
Market Funds)
By: 3:00 p.m.--N.Y. time Same Business Day
- ---------------------------------------------------------------------
After: 3:00 p.m.--N.Y. time Next Business Day
- ---------------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By: 5:00 p.m.--N.Y. time Same Business Day
- ---------------------------------------------------------------------
After: 5:00 p.m.--N.Y. time Next Business Day
- ---------------------------------------------------------------------
(3) Municipal Fund
By: 1:00 p.m.--N.Y. time Same Business Day
- ---------------------------------------------------------------------
After: 1:00 p.m.--N.Y. time Next Business Day
- ---------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By: 2:00 p.m.--N.Y. time Same Business Day
- ---------------------------------------------------------------------
After: 2:00 p.m.--N.Y. time Next Business Day
- ---------------------------------------------------------------------
The Service Organizations are responsible for timely transmittal of purchase
orders to Goldman Sachs and federal funds to Northern. In order to facilitate
timely transmittal, the Service Organizations have established times by which
purchase orders and federal funds must be received by them.
A Business Day means any day on which the New York Stock Exchange is open,
except for days on which Chicago, Boston or New York banks are closed for lo-
cal holidays.
28
<PAGE>
FST Preferred Shares of a Fund are purchased at the net asset value per
share without the imposition of a sales charge. Goldman Sachs, as each Fund's
transfer agent, will maintain a complete record of transactions and FST Pre-
ferred Shares held in each record holder's account. The Trust and Goldman
Sachs each reserves the right to reject any purchase order for any reason.
MINIMUM INVESTMENT AND OTHER INFORMATION
The minimum initial investment requirement is $10 million, which may be al-
located among the Funds. The Trust and Goldman Sachs each reserves the right
to waive the minimum investment requirement. A Service Organization may impose
a minimum amount for initial and subsequent investments in FST Preferred
Shares of the Funds, and may establish other requirements such as a minimum
account balance. A Service Organization may effect redemptions of noncomplying
accounts, and may impose a charge for any special services rendered to its
customers. Customers should contact their Service Organizations for further
information concerning such requirements and charges. A Service Organization
may purchase FST Preferred Shares in connection with sweep account programs.
SUBSEQUENT INVESTMENTS
There is no minimum amount required for subsequent investments. Orders for
the purchase of additional FST Preferred Shares should be accompanied by in-
formation identifying the account and the Fund in which FST Preferred Shares
are to be purchased.
REPORTS TO SHAREHOLDERS
The Trust will issue an annual report containing audited financial state-
ments and a semi-annual report to record holders of FST Preferred Shares of
each Fund, including Service Organizations who hold such Shares for the bene-
fit of their customers. Upon request, a printed confirmation for each transac-
tion will be provided by Goldman Sachs. Any dividends and distributions paid
by the Funds are also reflected in regular statements issued by Goldman Sachs
to shareholders of record. Service Organizations will be responsible for pro-
viding similar services to their own customers who are the beneficial owners
of such Shares.
DISTRIBUTIONS
All or substantially all of each Fund's net investment income will be de-
clared daily (as of 4:00 p.m. New York time for each Fund other than the Gov-
ernment, Treasury Obligations and Premium Money Market Funds and as of 5:00
p.m. New York time for the Government, Treasury Obligations and Premium Money
Market Funds) as a dividend and distributed to Service Organizations monthly.
Distributions will be made in additional FST Preferred Shares of the same Fund
or, at the election of a Service Organization, in cash. The election to rein-
vest dividends and distributions or receive them in cash may be changed by a
Service Organization at any time upon written notice to Goldman Sachs. If no
election is made, all dividends and capital gain distributions will be rein-
vested. Dividends will be reinvested as of the last calendar day of each
month. Cash distributions will be paid on or about the first business day of
each month. Net short-term capital gains, if any, will be distributed in ac-
cordance with the requirements of the Code and may be reflected in the Fund's
daily distributions. Each Fund may distribute at least annually its long-term
capital gains, if any, after reduction by available capital losses. In order
to avoid excessive fluctuations in the amount of monthly capital gains distri-
butions, a portion of any net capital gains realized on the disposition of se-
curities during the months of November and December may be distributed during
the subsequent calendar year. Although realized gains and losses on the assets
of a Fund are reflected in the net asset value of the Fund, they are not ex-
pected to be of an amount which would affect the Fund's net asset value of
$1.00 per share.
29
<PAGE>
The income declared as a dividend for the Treasury Obligations, Government
and Premium Money Market Funds is based on estimates of net investment income
for each Fund. Actual income may differ from estimates, and differences, if
any, will be included in the calculation of subsequent dividends.
A Fund's net investment income consists of the excess of (i) accrued inter-
est or discount (including both original issue and market discount on taxable
securities) on portfolio securities, and (ii) any income of the Fund from
sources other than capital gains over (iii) the amortization of market premium
on all portfolio securities and (iv) the estimated expenses of the Fund, in-
cluding a proportionate share of the general expenses of the Trust.
EXCHANGES
FST Preferred Shares of each Fund may be exchanged by Service Organizations
for FST Preferred Shares of any other Financial Square Fund at the net asset
value next determined either by writing to Goldman Sachs, Attention: Share-
holder Services, Goldman Sachs Trust, 4900 Sears Tower, Chicago, Illinois
60606, if previously elected in the Account Information Form, or by calling
Goldman Sachs at 800-621-2550. All telephone exchanges must be registered in
the same name(s) and with the same address as are registered in the Fund from
which the exchange is being made. It may be difficult to implement the tele-
phone exchange privilege in times of drastic economic or market changes. In an
effort to prevent unauthorized or fraudulent exchange requests by telephone,
Goldman Sachs employs reasonable procedures as set forth under "Redemption of
Shares" to confirm that such instructions are genuine. Exchanges are available
only in states where the exchange may legally be made. The exchange privilege
may be modified or withdrawn at any time on 60 days' written notice.
REDEMPTION OF SHARES
HOW TO REDEEM
Customers of Service Organizations may redeem FST Preferred Shares of a Fund
through their respective Service Organizations. The Service Organizations are
responsible for the transmittal of redemption requests by their customers to
Goldman Sachs. In order to facilitate timely transmittal of redemption re-
quests, Service Organizations have established procedures by which redemption
requests must be made and times by which redemption requests must be received
by them. Additional documentation may be required when deemed appropriate by a
Service Organization.
A Service Organization may redeem such Shares without charge upon request on
any Business Day at the net asset value next determined after receipt by
Goldman Sachs of the redemption request. Redemption requests may be made by
telephoning Goldman Sachs at 800-621-2550 or by a written request addressed to
Goldman Sachs, Attention: Shareholder Services, Goldman Sachs Trust, 4900
Sears Tower, Chicago, Illinois 60606. A Service Organization may request re-
demptions by telephone only if the optional telephone redemption privilege has
been elected on the Account Information Form. It may be difficult to implement
redemptions by telephone in times of drastic economic or market changes.
In an effort to prevent unauthorized or fraudulent redemption requests by
telephone, Goldman Sachs employs reasonable procedures specified by the Trust
to confirm that such instructions are genuine. Among other things, any redemp-
tion request that requires money to go to an account or address other than
that designated on
30
<PAGE>
the Account Information Form must be in writing and signed by an authorized
person designated on the Account Information Form. Any such written request is
also confirmed by telephone with both the requesting party and the designated
bank account to verify instructions. Other procedures may be implemented from
time to time. If reasonable procedures are not implemented, the Trust may be
liable for any loss due to unauthorized or fraudulent transactions. In all
other cases, neither the Trust nor Goldman Sachs will be responsible for the
authenticity of redemption instructions received by telephone. A redemption
may also be made with respect to certain Funds by means of the check redemp-
tion privilege described in the Statement of Additional Information. Goldman
Sachs reserves the right to redeem accounts with balances below $500.
Additional documentation may be required by Goldman Sachs in order to estab-
lish that a redemption request has been properly authorized. A redemption re-
quest will not be considered to have been received in proper form until such
additional documentation has been submitted to Goldman Sachs by the Service
Organization. The payment of redemption proceeds for FST Preferred Shares re-
cently purchased by check will be delayed for up to 15 days until the check
has cleared.
PAYMENT OF REDEMPTION PROCEEDS AND DIVIDENDS
In accordance with the following, redemption proceeds will be wired to the
record holder of FST Preferred Shares.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
REDEMPTION REQUEST
RECEIVED FROM REDEMPTION
SERVICE ORGANIZATION PROCEEDS
BY GOLDMAN SACHS ORDINARILY DIVIDENDS
-------------------- ---------- ---------
<C> <S> <C> <C>
(1) Taxable and Tax-Advantaged Funds (except Government,
Treasury Obligations and Premium Money Market Funds)
By: 3:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------
After: 3:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------
(2) Government, Treasury Obligations and
Premium Money Market Funds
By: 5:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------
After: 5:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------
(3) Municipal Fund
By: 12:00 noon--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------
After: 12:00 noon--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------
(4) Tax-Free Money Market Fund
By: 1:00 p.m.--N.Y. time Wired Same Business Day Not earned on Day
request is received
- ---------------------------------------------------------------------------
After: 1:00 p.m.--N.Y. time Wired Next Business Day Earned on Day
request is received
- ---------------------------------------------------------------------------
</TABLE>
31
<PAGE>
The Funds will arrange for the proceeds of redemptions effected by any means
to be wired as federal funds to the Service Organization's bank account desig-
nated in the Account Information Form. Redemption proceeds will normally be
wired as set forth above, but may be paid up to three Business Days after re-
ceipt of the Service Organization's properly executed redemption request. For
example, payment may be delayed if the Federal Reserve Bank is closed on the
day redemption proceeds would ordinarily be wired. After a wire has been ini-
tiated by Goldman Sachs, neither Goldman Sachs nor the Trust assumes any fur-
ther responsibility for the performance of intermediaries or the FST Preferred
Shareholder's Service Organization in the transfer process. If a problem with
such performance arises, the FST Preferred Shareholder should deal directly
with such intermediaries or Service Organization.
OTHER REDEMPTION INFORMATION
A minimum account balance of $10 million is required to remain a FST Pre-
ferred Shareholder. The Trust and Goldman Sachs each reserves the right to
waive the minimum account balance. The Trust reserves the right to redeem
shares of a shareholder account if the balance is less than the minimum de-
scribed above. The Trust will give sixty (60) days' prior written notice to
such shareholders whose FST Preferred Shares are to be redeemed to allow them
to purchase sufficient additional FST Preferred Shares to avoid such redemp-
tion.
----------------
32
<PAGE>
APPENDIX
GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON ACCOUNT INFORMATION FORM
You are required by law to provide the Fund with your correct Social Secu-
rity or other Taxpayer Identification Number (TIN), regardless of whether you
file tax returns. Failure to do so may subject you to penalties. Failure to
provide your correct TIN and to sign your name in the certification section of
the Account Information Form could result in withholding of 31% by the Fund
for the federal backup withholding tax on distributions, redemptions, ex-
changes and other payments relating to your account.
Any tax withheld may be credited against taxes owed on your federal income
tax return.
If you do not have a TIN, you should apply for one immediately by contacting
your local office of the Social Security Administration or the Internal Reve-
nue Service (IRS). Backup withholding could apply to payments relating to your
account prior to the Fund's receipt of your TIN.
Special rules apply for certain entities. For example, for an account estab-
lished under a Uniform Gifts or Transfers to Minors Act, the TIN of the minor
should be furnished.
If you have been notified by the IRS that you are subject to backup with-
holding because you failed to report all your interest and/or dividend income
on your tax return and you have not been notified by the IRS that such with-
holding should cease, you must cross out item (2) in the certification section
of the Account Information Form.
If you are an exempt recipient, you should furnish your TIN and certify your
exemption by signing the Certification section and writing "exempt" after your
signature. Exempt recipients include: corporations, tax-exempt pension plans
and IRA's, governmental agencies, financial institutions, registered securi-
ties and commodities dealers and others.
If you are a nonresident alien or foreign entity, you must provide a com-
pleted Form W-8 to the Fund in order to avoid backup withholding on certain
payments. Other payments to you may be subject to non-resident alien withhold-
ing of up to 30%.
For further information regarding backup and nonresident alien withholding,
see Sections 3406, 1441 and 1442 of the Internal Revenue Code and consult your
tax adviser.
A-1
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FST PREFERRED SHARES
4900 SEARS TOWER
CHICAGO, ILLINOIS 60606
TOLL FREE: 800-621-2550
-----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Shareholder and Fund Expenses.............................................. 2
Financial Highlights....................................................... 4
An Introduction to the Funds............................................... 12
Investment Policies Matrix................................................. 14
Description of Securities and Investment Techniques........................ 16
Investment Limitations..................................................... 21
Management................................................................. 22
Taxes...................................................................... 23
Net Asset Value............................................................ 25
Yield Information.......................................................... 25
Organization and Shares of the Trust....................................... 26
Administration............................................................. 27
Purchase of Shares......................................................... 27
Reports to Shareholders.................................................... 29
Distributions.............................................................. 29
Exchanges.................................................................. 30
Redemption of Shares....................................................... 30
Appendix................................................................... A-1
</TABLE>
FSPROPRMM
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
FST PREFERRED SHARES
-----------
PROSPECTUS
-----------
MANAGED BY
GOLDMAN SACHS ASSET MANAGEMENT
A SEPARATE OPERATING DIVISION OF
GOLDMAN, SACHS & CO.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
4900 Sears Tower, Chicago, Illinois 60606
________________________________________________________________________________
STATEMENT OF ADDITIONAL INFORMATION - SEPTEMBER 5, 1997
FST ADMINISTRATION SHARES
________________________________________________________________________________
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management investment
company (or mutual fund) which includes the Financial Square Funds. This
Statement of Additional Information relates solely to the offering of FST
Administration Shares of Financial Square Prime Obligations Fund ("Prime
Obligations Fund"), Financial Square Premium Money Market Fund ("Premium Fund"),
Financial Square Money Market Fund ("Money Market Fund"), Financial Square
Treasury Obligations Fund ("Treasury Obligations Fund"), Financial Square
Treasury Instruments Fund ("Treasury Instruments Fund"), Financial Square
Government Fund ("Government Fund"), Financial Square Federal Fund ("Federal
Fund"), Financial Square Tax-Free Money Market Fund ("Tax-Free Fund") and
Financial Square Municipal Money Market Fund ("Municipal Fund") (individually, a
"Fund" and collectively the "Funds").
Goldman Sachs Asset Management ("GSAM" or the "Adviser"), a separate operating
division of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds'
investment adviser. Goldman Sachs serves as the Funds' distributor and
transfer agent.
The Goldman Sachs Funds offer banks, corporate cash managers, investment
advisers and other institutional investors a family of professionally-managed
mutual funds, including money market, fixed income and equity funds, and a range
of related services. All products are designed to provide clients with the
benefit of the expertise of GSAM and its affiliates in security selection, asset
allocation, portfolio construction and day-to-day management.
The hallmark of the Goldman Sachs Funds is personalized service, which reflects
the priority that Goldman Sachs places on serving clients' interests. As
Goldman Sachs clients, shareholders will be assigned an Account Administrator
("AA"), who is ready to help shareholders with questions concerning their
accounts. During business hours, service organizations can call their AA
through a toll-free number to place purchase or redemption orders or obtain Fund
and account information. The AA can also answer inquiries about rates of return
and portfolio composition and holdings, and guide service organizations through
operational details. A Goldman Sachs client can also utilize the SMART
personal computer software system which allows shareholders to purchase or
<PAGE>
redeem shares and also obtain Fund and account information directly.
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectuses relating to FST Administration Shares dated
September 5, 1997, a copy of which may be obtained without charge from Service
Organizations, as defined herein, or by calling Goldman Sachs at 800-621-2550 or
by writing Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606.
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page in
Statement of
Additional
Information
------------
<S> <C>
Investment Policies and Practices of the Funds...... 4
Investment Limitations.............................. 17
Trustees and Officers............................... 22
The Adviser, Distributor
and Transfer Agent................................ 28
Portfolio Transactions.............................. 33
Net Asset Value..................................... 35
Redemptions......................................... 37
Calculation of Yield Quotations..................... 38
Tax Information..................................... 41
Organization and Capitalization..................... 46
Custodian and Subcustodian.......................... 51
Independent Accountants............................. 52
Financial Statements................................ 52
Administration Plan................................. 53
Appendix A (Description of Securities Ratings)...... A-1
</TABLE>
3
<PAGE>
ADMINISTRATION PLAN
The Trust, on behalf of each Fund, has adopted an administration plan (the
"Plan") with respect to the FST Administration Shares which authorizes the Funds
to compensate Service Organization for providing certain account administration
services to their customers who are beneficial owners of such shares. Pursuant
to the Plan, the Trust, on behalf of each Fund, will enter into agreements with
Service Organizations which purchase FST Administration Shares on behalf of
their customers ("Service Agreements"). Under such Service Agreements the
Service Organization may: (a) act, directly or through an agent, as the sole
shareholder of record and nominee for all customers, (b) maintain account
records for each customer who beneficially owns FST Administration Shares, (c)
answer questions and handle correspondence from customers regarding their
accounts, (d) process customer orders to purchase, redeem and exchange FST
Administration Shares, and handle the transmission of funds representing the
customers' purchase price or redemption proceeds, and (e) issue confirmations
for transactions in shares by customers. As compensation for such services, each
Fund will pay each Service Organization an administration fee in an amount up to
..25% (on an annualized basis) of the average daily net assets of the FST
Administration Shares of such Fund attributable to or held in the name of such
Service Organization.
For the fiscal years ended December 31, 1996 and December 31, 1995 and the
eleven months ended December 31, 1994, the amount of administration fees paid by
each Fund to Service Organizations was as follows:
<TABLE>
<CAPTION>
Dec. 1996 Dec. 1995 Dec. 1994
---------- --------- ---------
<S> <C> <C> <C>
Prime Obligations Fund $ 527,357 $ 318,346 $ 139,235
Money Market Fund/(1)/ 474,043 283,241 78,743
Treasury Obligations Fund 1,100,814 457,071 79,171
Government Fund 250,618 131,629 83,036
Tax Free Fund/(2)/ 128,721 32,166 1,800
</TABLE>
________________
(1) FST Administration Share activity commenced May 20, 1994.
(2) FST Administration Share activity commenced August 1, 1994.
As of December 31, 1996, the Premium Fund, Treasury Instruments Fund,
Federal Fund and Municipal Fund had not commenced operations.
Conflict of interest restrictions (including the Employee Retirement Income
Security Act of 1974) may apply to a Service Organization's receipt of
compensation paid by the Trust in connection with the investment of fiduciary
funds in FST Administration Shares. Service Organizations, including banks
regulated by the Comptroller of the Currency, the Federal Reserve Board or the
Federal Deposit Insurance Corporation, and investment advisers and other money
managers subject to the jurisdiction of the SEC, the Department of Laboror
state securities commissions, are urged to consult legal advisers before
investing fiduciary assets
53
<PAGE>
in FST Administration Shares. In addition, under some state securities laws,
banks and other financial institutions purchasing FST Administration Shares on
behalf of their customers may be required to register as dealers.
The Trustees, including a majority of the Trustees who are not interested
persons of the Trust and who have no direct or indirect financial interest in
the operation of such Plan or the related Service Agreements, most recently
voted to approve the Plan and Service Agreements for each Fund at a meeting
called for the purpose of voting on such Plan and Service Agreements on April
23, 1997. The Plan and Service Agreements will remain in effect until April 30,
1998 and will continue in effect thereafter only if such continuance is
specifically approved annually by a vote of the Board of Trustees in the manner
described above.
The Plan may not be amended to increase materially the amount to be spent
for the services described therein without approval of the FST Administration
Shareholders of each Fund, and all material amendments of the Plan must also be
approved by the Board of Trustees in the manner described above. The Plan may be
terminated at any time by a majority of the Board of Trustees as described above
or by vote of a majority of the outstanding FST Administration Shares of each
Fund. The Service Agreements may be terminated at any time, without payment of
any penalty, by vote of a majority of the Board of Trustees as described above
or by a vote of a majority of the outstanding FST Administration Shares of each
Fund on not more than sixty (60) days' written notice to any other party to the
Service Agreements. The Service Agreements shall terminate automatically if
assigned. As long as the Plan is in effect, the selection and nomination of
those Trustees who are not interested persons shall be committed to the
discretion of the Trust's Nominating Committee, which consists of all of the
non-interested members of the Board of Trustees. The Board of Trustees has
determined that, in its judgment, there is a reasonable likelihood that the Plan
will benefit each Fund and holders of FST Administration Shares of such Fund. In
the Board of Trustees' quarterly review of the Plan and Service Agreements, the
Board will consider their continued appropriateness and the level of
compensation provided therein.
54
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
4900 Sears Tower, Chicago, Illinois 60606
- --------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION - SEPTEMBER 5, 1997
FST SERVICE SHARES
- --------------------------------------------------------------------------------
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management investment
company (or mutual fund) which includes the Financial Square Funds. This
Statement of Additional Information relates solely to the offering of FST
Service Shares of Financial Square Prime Obligations Fund ("Prime Obligations
Fund"), Financial Square Premium Money Market Fund ("Premium Fund"), Financial
Square Money Market Fund ("Money Market Fund"), Financial Square Treasury
Obligations Fund ("Treasury Obligations Fund"), Financial Square Treasury
Instruments Fund ("Treasury Instruments Fund"), Financial Square Government Fund
("Government Fund"), Financial Square Federal Fund ("Federal Fund"), Financial
Square Tax-Free Money Market Fund ("Tax-Free Fund") and Financial Square
Municipal Money Market Fund ("Municipal Fund") (individually, a "Fund" and
collectively the "Funds").
Goldman Sachs Asset Management ("GSAM" or the "Adviser"), a separate operating
division of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds'
investment adviser. Goldman Sachs serves as the Funds' distributor and transfer
agent.
The Goldman Sachs Funds offer banks, corporate cash managers, investment
advisers and other institutional investors a family of professionally-managed
mutual funds, including money market, fixed income and equity funds, and a range
of related services. All products are designed to provide clients with the
benefit of the expertise of GSAM and its affiliates in security selection, asset
allocation, portfolio construction and day-to-day management.
The hallmark of the Goldman Sachs Funds is personalized service, which reflects
the priority that Goldman Sachs places on serving clients' interests. As
Goldman Sachs clients, shareholders will be assigned an Account Administrator
("AA"), who is ready to help shareholders with questions concerning their
accounts. During business hours, service organizations can call their AA
through a toll-free number to place purchase or redemption orders or obtain Fund
and account information. The AA can also answer inquiries about rates of return
and portfolio composition and holdings, and guide service organizations through
operational details. A Goldman Sachs client can also utilize the SMART
personal computer software system which allows shareholders to purchase or
<PAGE>
redeem shares and also obtain Fund and account information directly.
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectuses relating to FST Service Shares dated
September 5, 1997, a copy of which may be obtained without charge from Service
Organizations, as defined herein, or by calling Goldman Sachs at 800-621-2550 or
by writing Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606.
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page in
Statement of
Additional
Information
------------
<S> <C>
Investment Policies and Practices of the
Funds................................ 4
Investment Limitations.................... 17
Trustees and Officers..................... 22
The Adviser, Distributor
and Transfer Agent................... 28
Portfolio Transactions.................... 33
Net Asset Value........................... 35
Redemptions............................... 37
Calculation of Yield Quotations........... 38
Tax Information........................... 41
Organization and Capitalization........... 46
Custodian and Subcustodian................ 51
Independent Accountants................... 52
Financial Statements...................... 52
Service Plan.............................. 53
Appendix A (Description of Securities
Ratings)............................. A-1
</TABLE>
3
<PAGE>
SERVICE PLAN
The Trust, on behalf of each Fund, has adopted a service plan (the "Plan") with
respect to the FST Service Shares which authorizes the Funds to compensate
Service Organizations for providing certain account administration and personal
and account maintenance services to their customers who are beneficial owners
of such shares. Pursuant to the Plan, the Trust, on behalf of each Fund, enters
into agreements with Service Organizations which purchase FST Service Shares on
behalf of their customers ("Service Agreements"). Under such Service
Agreements the Service Organizations may: (a) act, directly or through an agent,
as the sole shareholder of record and nominee for all customers, (b) maintain
account records for each customer who beneficially owns FST Service Shares, (c)
answer questions and handle correspondence from customers regarding their
accounts, (d) process customer orders to purchase, redeem and exchange FST
Service Shares, and handle the transmission of funds representing the customers'
purchase price or redemption proceeds, (e) issue confirmations for transactions
in shares by customers, (f) provide facilities to answer questions from
prospective and existing investors about FST Service Shares, (g) receive and
answer investor correspondence, including requests for prospectuses and
statements of additional information, (h) display and make prospectuses
available on the Service Organization's premises, (i) assist customers in
completing application forms, selecting dividend and other account options and
opening custody accounts with the Service Organization and (j) act as liaison
between customers and the Funds, including obtaining information from the Funds,
working with the Funds to correct errors and resolve problems and providing
statistical and other information to the Funds. As compensation for such
services, the Trust, on behalf of each Fund, pays each Service Organization a
service fee in an amount up to .50% (on an annualized basis) of the average
daily net assets of the FST Service Shares of each Fund attributable to or held
in the name of such Service Organization for its customers; provided, however,
that the fee paid for personal and account maintenance services shall not exceed
..25% of such average daily net assets.
For the fiscal years ended December 31, 1996 and December 31, 1995 and the
eleven months ended December 31, 1994, the amount of service fees paid by each
Fund to Service Organizations was as follows:
53
<PAGE>
<TABLE>
<CAPTION>
Dec. 1996 Dec. 1995 Dec. 1994
--------- --------- ---------
<S> <C> <C> <C>
Prime Obligations Fund $ 541,076 $299,892 $115,595
Money Market Fund/(1)/ 271,936 8,447 -
Treasury Obligations Fund 849,624 584,861 168,982
Government Fund/(2)/ 1,258,434 39,940 -
Tax-Free Fund/(3)/ 91,599 70,179 1,199
</TABLE>
_______________
(1) FST Service Share activity commenced June 14, 1995.
(2) FST Service Share activity commenced May 16, 1995.
(3) FST Service Share activity commenced September 23, 1994.
As of December 31, 1996, the Premium Fund, Treasury Instruments Fund, Federal
Fund and Municipal Income Fund had not commenced operations.
The Trust has adopted the Plan pursuant to Rule 12b-1 under the Investment
Company Act in order to avoid any possibility that payments to the Service
Organizations pursuant to the Service Agreements might violate the Investment
Company Act. Rule 12b-1, which was adopted by the SEC under the Investment
Company Act, regulates the circumstances under which an investment company or
series thereof may bear expenses associated with the distribution of its shares.
In particular, such an investment company or series thereof cannot engage
directly or indirectly in financing any activity which is primarily intended to
result in the sale of shares issued by the company unless it has adopted a plan
pursuant to, and complies with the other requirements of, such Rule. The Trust
believes that fees paid for the services provided in the Plan and described
above are not expenses incurred primarily for effecting the distribution of FST
Service Shares. However, should such payments be deemed by a court or the SEC
to be distribution expenses, such payments would be duly authorized by the Plan.
The Glass-Steagall Act prohibits all entities which receive deposits from
engaging to any extent in the business of issuing, underwriting, selling or
distributing securities, although institutions such as national banks are
permitted to purchase and sell securities upon the order and for the account of
their customers. In addition, state securities laws on this issue may differ
from the interpretations of federal law expressed herein and banks and other
financial institutions purchasing FST Service Shares on behalf of their
customers may be required to register as dealers pursuant to state law. Should
future legislative or administrative action or judicial or administrative
decisions or interpretations prohibit or restrict the activities of one or more
of the Service Organizations in connection with the Funds, such Service
Organizations might be required to alter materially or discontinue the services
performed under their Service Agreements. If one or more of the Service
Organizations were restricted from effecting purchases or sales of FST Service
Shares automatically pursuant to pre-authorized instructions, for
54
<PAGE>
example, effecting such transactions on a manual basis might affect the size
and/or growth of a Fund. Any such alteration or discontinuance of services
could require the Board of Trustees to consider changing the Funds' method of
operations or providing alternative means of offering FST Service Shares to
customers of such Service Organizations, in which case the operation of a Fund,
its size and/or its growth might be significantly altered. It is not
anticipated, however, that any alteration of the Funds' operations would have
any effect on the net asset value per share or result in financial losses to any
shareholder.
Conflict of interest restrictions (including the Employee Retirement Income
Security Act of 1974) may apply to a Service Organization's receipt of
compensation paid by the Trust in connection with the investment of fiduciary
funds in FST Service Shares. Service Organizations, including banks regulated
by the Comptroller of the Currency, the Federal Reserve Board or the Federal
Deposit Insurance Corporation, and investment advisers and other money managers
subject to the jurisdiction of the SEC, the Department of Labor or state
securities commissions, are urged to consult legal advisers before investing
fiduciary assets in FST Service Shares.
The Trustees, including a majority of the Trustees who are not interested
persons of the Trust and who have no direct or indirect financial interest in
the operation of such Plan or the related Service Agreements, most recently
voted to approve the Plan and Service Agreements for each Fund at a meeting
called for the purpose of voting on such Plan and Service Agreements on April
23, 1997. The Plan and Service Agreements will remain in effect until April 30,
1998 and will continue in effect thereafter only if such continuance is
specifically approved annually by a vote of the Board of Trustees in the manner
described above.
The Plan may not be amended to increase materially the amount to be spent for
the services described therein without approval of the FST Service Shareholders
of each Fund, and all material amendments of the Plan must also be approved by
the Board of Trustees in the manner described above. The Plan may be terminated
at any time by a majority of the Board of Trustees as described above or by vote
of a majority of the outstanding FST Service Shares of each Fund. The Service
Agreements may be terminated at any time, without payment of any penalty, by
vote of a majority of the Board of Trustees as described above or by a vote of a
majority of the outstanding FST Service Shares of each Fund on not more than
sixty (60) days' written notice to any other party to the Service Agreements.
The Service Agreements shall terminate automatically if assigned. As long as
the Plan is in effect, the selection and nomination of those Trustees who are
not interested persons shall be committed to the discretion of the Trust's
Nominating Committee, which consists of all of the non-interested members of the
Board of Trustees. The Board of Trustees has
55
<PAGE>
determined that, in its judgment, there is a reasonable likelihood that the
Plan will benefit each Fund and holders of FST Service Shares of such Fund. In
the Board of Trustees' quarterly review of the Plan and Service Agreements, the
Board will consider their continued appropriateness and the level of
compensation provided therein.
56
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS FINANCIAL SQUARE FUNDS
4900 Sears Tower, Chicago, Illinois 60606
- --------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION - SEPTEMBER 5, 1997
FST PREFERRED SHARES
- --------------------------------------------------------------------------------
Goldman Sachs Trust (the "Trust") is a no-load, open-end, management
investment company (or mutual fund) which includes the Financial Square Funds.
This Statement of Additional Information relates solely to the offering of FST
Preferred Shares of Financial Square Prime Obligations Fund ("Prime Obligations
Fund"), Financial Square Money Market Fund ("Money Market Fund"), Financial
Square Treasury Obligations Fund ("Treasury Obligations Fund"), Financial Square
Treasury Instruments Fund ("Treasury Instruments Fund") Financial Square
Government Fund ("Government Fund"), Financial Square Federal Fund ("Federal
Fund"), Financial Square Tax-Free Money Market Fund ("Tax-Free Fund"), Financial
Square Premium Money Market Fund ("Premium Fund") and Financial Square Municipal
Money Market Fund ("Municipal Fund") (individually, a "Fund" and collectively
the "Funds").
Goldman Sachs Asset Management ("GSAM" or the "Adviser"), a separate
operating division of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the
Funds' investment adviser . Goldman Sachs serves as the Funds' distributor and
transfer agent.
The Goldman Sachs Funds offer banks, corporate cash managers, investment
advisers and other institutional investors a family of professionally-managed
mutual funds, including money market, fixed income and equity funds, and a range
of related services. All products are designed to provide clients with the
benefit of the expertise of GSAM and its affiliates in security selection, asset
allocation, portfolio construction and day-to-day management.
The hallmark of the Goldman Sachs Funds is personalized service, which
reflects the priority that Goldman Sachs places on serving clients' interests.
As Goldman Sachs clients, shareholders will be assigned an Account
Administrator ("AA"), who is ready to help shareholders with questions
concerning their accounts. During business hours, service organizations can call
their AA through a toll-free number to place purchase or redemption orders
or obtain Fund and account information. The AA can also answer inquiries about
rates of return and portfolio composition and holdings, and guide service
organizations through operational details. A Goldman Sachs client can also
utilize the SMART personal computer software system which allows shareholders
<PAGE>
to purchase or redeem shares and also obtain Fund and account information
directly.
This Statement of Additional Information is not a prospectus and should be
read in conjunction with the Prospectus relating to FST Preferred Shares dated
September 5, 1997, a copy of which may be obtained without charge from Service
Organizations, as defined herein, or by calling Goldman Sachs at 800-621-2550 or
by writing Goldman Sachs, 4900 Sears Tower, Chicago, Illinois 60606.
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page in
Statement of
Additional
Information
------------
<S> <C>
Investment Policies and Practices of the
Funds................................ 4
Investment Limitations.................... 17
Trustees and Officers..................... 22
The Adviser, Distributor
and Transfer Agent................... 28
Portfolio Transactions.................... 33
Net Asset Value........................... 35
Redemptions............................... 37
Calculation of Yield Quotations........... 38
Tax Information........................... 41
Organization and Capitalization........... 46
Custodian and Subcustodian................ 51
Independent Accountants................... 52
Financial Statements...................... 52
Preferred Administration Plan............. 53
Appendix A (Description of Securities
Ratings)............................. A-1
</TABLE>
3
<PAGE>
PREFERRED ADMINISTRATION PLAN
The Trust, on behalf of the Funds, has adopted a preferred administration
plan (the "Plan") with respect to the FST Preferred Shares which authorizes the
Funds to compensate Service Organizations for providing certain account
administration services to their customers who are beneficial owners of such
shares. Pursuant to the Plan, the Trust, on behalf of each Fund, will enter
into agreements with Service Organizations which purchase FST Preferred Shares
on behalf of their customers ("Service Agreements"). Under such Service
Agreements the Service Organizations may: (a) act, directly or through an agent,
as the sole shareholder of record and nominee for all customers, (b) maintain
account records for each customer who beneficially owns FST Preferred Shares,
(c) process customer orders to purchase, redeem and exchange FST Preferred
Shares, and handle the transmission of funds representing the customers'
purchase price or redemption proceeds. As compensation for such services, each
Fund, will pay each Service Organization a service fee in an amount up to .10%
(on an annualized basis) of the average daily net assets of the FST Preferred
Shares of the Fund attributable to or held in the name of such Service
Organization.
For the fiscal year ended December 31, 1996 the amount of preferred
administration fees paid by each Fund to Service Organizations was as follows:
<TABLE>
<CAPTION>
Dec. 1996
---------
<S> <C>
Prime Obligations Fund..... $ 42,963
Money Market Fund.......... 2,874
Treasury Obligations Fund.. 15,097
Government Fund............ 395
Tax Free Fund.............. 13,155
</TABLE>
As of December 31, 1996, the Premium Fund, Treasury Instruments Fund,
Federal Fund and Municipal Income Fund had not commenced operations.
Conflict of interest restrictions (including the Employee Retirement Income
Security Act of 1974) may apply to a Service Organization's receipt of
compensation paid by the Trust in connection with the investment of fiduciary
funds in FST Preferred Shares. Service Organizations, including banks
regulated by the Comptroller of the Currency, the Federal Reserve Board or the
Federal Deposit Insurance Corporation, and investment advisers and other money
managers subject to the jurisdiction of the SEC, the Department of Labor or
state securities commissions, are urged to consult legal advisers before
investing fiduciary assets in FST Preferred Shares. In addition, under some
state securities laws, banks and other financial institutions purchasing FST
53
<PAGE>
Preferred Shares on behalf of their customers may be required to register as
dealers.
The Trustees, including a majority of the Trustees who are not interested
persons of the Trust and who have no direct or indirect financial interest in
the operation of such Plan or the related Service Agreements, most recently
voted to approve the Plan and Service Agreements at a meeting called for the
purpose of voting on such Plan and Service Agreements on April 23, 1997. The
Plan and Service Agreements will remain in effect until April 30, 1998 and will
continue in effect thereafter only if such continuance is specifically approved
annually by a vote of the Board of Trustees in the manner described above. The
Plan may not be amended to increase materially the amount to be spent for the
services described therein without approval of the FST Preferred Shareholders of
the Funds, and all material amendments of the Plan must also be approved by the
Board of Trustees in the manner described above. The Plan may be terminated at
any time by a majority of the Board of Trustees as described above or by vote of
a majority of the outstanding FST Preferred Shares of the Funds. The Service
Agreements may be terminated at any time, without payment of any penalty, by
vote of a majority of the Board of Trustees as described above or by a vote of a
majority of the outstanding FST Preferred Shares of the Funds on not more than
sixty (60) days' written notice to any other party to the Service Agreements.
The Service Agreements shall terminate automatically if assigned. As long as the
Plan is in effect, the selection and nomination of those Trustees who are not
interested persons shall be committed to the discretion of the Trust's
Nominating Committee, which consists of all of the non-interested members of the
Board of Trustees. The Board of Trustees has determined that, in its judgment,
there is a reasonable likelihood that the Plan will benefit the Funds and
holders of FST Preferred Shares of the Funds. In the Board of Trustees'
quarterly review of the Plan and Service Agreements, the Board will consider
their continued appropriateness and the level of compensation provided therein.
54
<PAGE>
GOLDMAN SACHS MONEY MARKET FUNDS
FINANCIAL SQUARE FUNDS
4900 Sears Tower, Chicago, Illinois 60606
- --------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION - SEPTEMBER 5, 1997
FST SHARES
- --------------------------------------------------------------------------------
Goldman Sachs Trust (the "Trust") is an open-end management investment company
(or mutual fund) which includes the Financial Square Funds. This Statement of
Additional Information relates solely to the offering of FST Shares of Financial
Square Prime Obligations Fund ("Prime Obligations Fund"), Financial Square
Premium Money Market Fund ("Premium Fund"), Financial Square Money Market Fund
("Money Market Fund"), Financial Square Treasury Obligations Fund ("Treasury
Obligations Fund"), Financial Square Treasury Instruments Fund ("Treasury
Instruments Fund"), Financial Square Government Fund ("Government Fund"),
Financial Square Federal Fund ("Federal Fund"), Financial Square Tax-Free Money
Market Fund ("Tax-Free Fund") and Financial Square Municipal Money Market Fund
("Municipal Fund") (individually, a "Fund" and collectively the "Funds").
Goldman Sachs Asset Management ("GSAM" or the "Adviser"), a separate operating
division of Goldman, Sachs & Co. ("Goldman Sachs"), serves as the Funds'
investment adviser. Goldman Sachs serves as the Funds' distributor and transfer
agent.
The Goldman Sachs Funds offer banks, corporate cash managers, investment
advisers and other institutional investors a family of professionally-managed
mutual funds, including money market, fixed income and equity funds, and a range
of related services. All products are designed to provide clients with the
benefit of the expertise of GSAM and its affiliates in security selection, asset
allocation, portfolio construction and day-to-day management.
The hallmark of the Goldman Sachs Funds is personalized service, which reflects
the priority that Goldman Sachs places on serving clients' interests. As
Goldman Sachs clients, shareholders will be assigned an Account Administrator
("AA"), who is ready to help shareholders with questions concerning their
accounts. During business hours, shareholders can call their AA through a toll-
free number to place purchase or redemption orders or obtain Fund and account
information. The AA can also answer inquiries about rates of return and
portfolio composition/holdings, and guide shareholders through operational
details. A Goldman Sachs client can also utilize the SMART personal computer
software system
<PAGE>
which allows shareholders to purchase or redeem shares and also obtain Fund and
account information directly.
This Statement of Additional Information is not a prospectus and should be read
in conjunction with the Prospectus relating to FST Shares dated September 5,
1997, a copy of which may be obtained without charge by calling Goldman Sachs at
800-621-2550 or by writing Goldman Sachs, 4900 Sears Tower, Chicago, Illinois
60606.
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page in
Statement of
Additional
Information
-------------
<S> <C>
Investment Policies and Practices
of the Funds 4
Investment Limitations 17
Trustees and Officers 22
The Adviser, Distributor and Transfer
Agent 28
Portfolio Transactions 33
Net Asset Value 35
Redemptions 37
Calculation of Yield Quotations 38
Tax Information 42
Organization and Capitalization 47
Custodian and Subcustodian 52
Independent Accountants 52
Financial Statements 52
Appendix A (Description of Securities
Ratings) A-1
</TABLE>
3
<PAGE>
INVESTMENT POLICIES AND PRACTICES OF THE FUNDS
The following discussion elaborates on the description of each Fund's investment
policies and practices contained in the Prospectus:
U.S. GOVERNMENT SECURITIES
- --------------------------
Each Fund may invest in separately traded principal and interest components of
securities issued or guaranteed by the U.S. Treasury. The principal and
interest components of selected securities are traded independently under the
Separate Trading of Registered Interest and Principal of Securities program
("STRIPS"). Under the STRIPS program, the principal and interest components are
individually numbered and separately issued by the U.S. Treasury at the request
of depository financial institutions, which then trade the component parts
independently.
CUSTODIAL RECEIPTS
- ------------------
Each Fund (other than Treasury Obligations, Government, Treasury Instruments and
Federal Funds) may also acquire custodial receipts that evidence ownership of
future interest payments, principal payments or both on certain U.S. Government
notes or bonds. Such notes and bonds are held in custody by a bank on behalf of
the owners. These custodial receipts are known by various names, including
"Treasury Receipts," "Treasury Investors Growth Receipts" ("TIGR's"), and
"Certificates of Accrual on Treasury Securities" ("CATS"). Although custodial
receipts are not considered U.S. Government securities for certain securities
law purposes, they are indirectly issued or guaranteed as to principal and
interest by the U.S. Government, its agencies, authorities or instrumentalities.
BANK AND CORPORATE OBLIGATIONS
- ------------------------------
Each Fund (other than Treasury Obligations, Government, Treasury Instruments and
Federal Funds) may invest in commercial paper. Commercial paper represents
short-term unsecured promissory notes issued in bearer form by banks or bank
holding companies, corporations, and finance companies. The commercial paper
purchased by the Funds consists of direct U.S. dollar denominated obligations of
domestic, or in the case of the Money Market and Premium Funds, foreign issuers.
Bank obligations in which the Funds may invest include certificates of deposit,
bankers' acceptances, fixed time deposits and bank notes. Certificates of
deposit are negotiable certificates issued against funds deposited in a
commercial bank for a definite period of time and earning a specified
return.
Bankers' acceptances are negotiable drafts or bills of exchange, normally drawn
by an importer or exporter to pay for specific merchandise, which are "accepted"
by a bank, meaning, in effect,
4
<PAGE>
that the bank unconditionally agrees to pay the face value of the instrument on
maturity. Fixed time deposits are bank obligations payable at a stated maturity
date and bearing interest at a fixed rate. Fixed time deposits may be withdrawn
on demand by the investor, but may be subject to early withdrawal penalties
which vary depending upon market conditions and the remaining maturity of the
obligation. There are no contractual restrictions on the right to transfer a
beneficial interest in a fixed time deposit to a third party, although there is
no market for such deposits. Bank notes and bankers' acceptances rank junior to
domestic deposit liabilities of the bank and pari passu with other senior,
unsecured obligations of the bank. Bank notes are not insured by the Federal
Deposit Insurance Corporation or any other insurer. Deposit notes are insured
by the Federal Deposit Insurance Corporation only to the extent of $100,000 per
depositor per bank.
Prime Obligations Fund, Premium Fund and Money Market Fund may invest in short-
term funding agreements. A funding agreement is a contract between an issuer
and a purchaser that obligates the issuer to pay a guaranteed rate of interest
on a principal sum deposited by the purchaser. Funding agreements will also
guarantee the return of principal and may guarantee a stream of payments over
time. A funding agreement has a fixed maturity date and may have either a fixed
rate or variable interest rate that is based on an index and guaranteed for a
set time period. Because there is no secondary market for these investments,
any such funding agreement purchased by a Fund will be regarded as
illiquid.
REPURCHASE AGREEMENTS
- ---------------------
Each Fund (other than Treasury Instruments Fund) may enter into repurchase
agreements only with primary dealers in U.S. Government Securities. A
repurchase agreement is an arrangement under which the purchaser (i.e., the
Fund) purchases a U.S. Government security or other high quality short-term debt
obligation (the "Obligation") and the seller agrees, at the time of sale, to
repurchase the Obligation at a specified time and price.
Custody of the Obligation will be maintained by the Funds' custodian or
subcustodian. The repurchase price may be higher than the purchase price, the
difference being income to the Fund, or the purchase and repurchase prices may
be the same, with interest at a stated rate due to the Fund together with the
repurchase price on repurchase. In either case, the income to a Fund is
unrelated to the interest rate on the Obligation subject to the repurchase
agreement.
Repurchase agreements pose certain risks for all entities, including the Funds,
that utilize them. Such risks are not unique to the Funds but are inherent in
repurchase agreements. The Funds seek to minimize such risks by, among others,
the means indicated below, but because of the inherent legal uncertainties
5
<PAGE>
involved in repurchase agreements, such risks cannot be eliminated.
For purposes of the Investment Company Act of 1940, as amended (the "Investment
Company Act"), and, generally, for tax purposes, a repurchase agreement is
deemed to be a loan from a Fund to the seller of the Obligation. It is not
clear whether for other purposes a court would consider the Obligation purchased
by a Fund subject to a repurchase agreement as being owned by a Fund or as being
collateral for a loan by the Fund to the seller.
If, in the event of bankruptcy or insolvency proceedings against the seller of
the Obligation, a court holds that a Fund does not have a perfected security
interest in the Obligation, a Fund may be required to return the Obligation to
the seller's estate and be treated as an unsecured creditor of the seller. As
an unsecured creditor, a Fund would be at risk of losing some or all of the
principal and income involved in the transaction. To minimize this risk, the
Funds utilize custodians and subcustodians that the Adviser believes follow
customary securities industry practice with respect to repurchase agreements,
and the Adviser analyzes the creditworthiness of the obligor, in this case the
seller of the Obligation. But because of the legal uncertainties, this risk,
like others associated with repurchase agreements, cannot be eliminated.
Also, in the event of commencement of bankruptcy or insolvency proceedings with
respect to the seller of the Obligation before repurchase of the Obligation
under a repurchase agreement, a Fund may encounter delay and incur costs before
being able to sell the security. Such a delay may involve loss of interest or a
decline in the price of the Obligation.
Apart from risks associated with bankruptcy or insolvency proceedings, there is
also the risk that the seller may fail to repurchase the security. However, if
the market value of the Obligation subject to the repurchase agreement becomes
less than the repurchase price (including accrued interest), the Fund will
direct the seller of the Obligation to deliver additional securities so that
the market value of all securities subject to the repurchase agreement equals or
exceeds the repurchase price.
Certain repurchase agreements which mature in more than seven days can be
liquidated before the nominal fixed term on seven days or less notice. Such
repurchase agreements will be regarded as liquid instruments.
In addition, the Funds (other than the Treasury Instruments Fund), together with
other registered investment companies having management agreements with the
Adviser or any of its affiliates, may transfer uninvested cash balances into a
single joint account, the daily aggregate balance of which will be invested in
one or more repurchase agreements.
6
<PAGE>
FOREIGN SECURITIES
- ------------------
Money Market Fund and Premium Fund may invest in foreign securities and in
certificates of deposit, bankers' acceptances and fixed time deposits and other
obligations issued by major foreign banks, foreign branches of U.S. banks, U.S.
branches of foreign banks and foreign branches of foreign banks. Tax-Free Fund
and Municipal Fund may also invest in municipal instruments backed by letters of
credit issued by certain of such banks. Under current Securities and Exchange
Commission ("SEC") rules relating to the use of the amortized cost method of
portfolio securities valuation, Money Market Fund and Premium Fund are
restricted to purchasing U.S. dollar denominated securities, but they are not
otherwise precluded from purchasing securities of foreign issuers.
Investments in foreign securities and bank obligations may involve
considerations different from investments in domestic securities due to limited
publicly available information; non-uniform accounting standards; the possible
imposition of withholding or confiscatory taxes; the possible adoption of
foreign governmental restrictions affecting the payment of principal and
interest; expropriation; or other adverse political or economic developments.
In addition, it may be more difficult to obtain and enforce a judgment against a
foreign issuer or a foreign branch of a domestic bank.
ASSET-BACKED AND RECEIVABLES-BACKED SECURITIES
- ----------------------------------------------
Each of Prime Obligations Fund, Money Market Fund and Premium Fund may invest in
asset-backed and receivables-backed securities. Asset-backed and receivables-
backed securities represent participations in, or are secured by and payable
from, pools of assets such as motor vehicle installment sale contracts,
installment loan contracts, leases of various types of real and personal
property, receivables from revolving credit (credit card) agreements, corporate
securities and other categories of receivables. Such asset pools are securitized
through the use of privately-formed trusts or special purpose vehicles. Payments
or distributions of principal and interest may be guaranteed up to certain
amounts and for a certain time period by a letter of credit or a pool insurance
policy issued by a financial institution, or other credit enhancements may be
present. The value of a Fund's investments in asset-backed and receivables-
backed securities may be adversely affected by prepayment of the underlying
obligations. In addition, the risk of prepayment may cause the value of these
investments to be more volatile than a Fund's other investments.
Through the use of trusts and special purpose corporations, various types of
assets, including automobile loans, computer leases, trade receivables and
credit card receivables, are being securitized in pass-through structures
similar to the mortgage pass-through structures. Consistent with their
respective
7
<PAGE>
investment objective and policies, the Funds may invest in these and other types
of asset-backed securities that may be developed in the future. This Statement
of Additional Information will be amended or supplemented as necessary to
reflect the Prime Obligations, Money Market and Premium Funds' intention to
invest in asset-backed securities with characteristics that are materially
different from the securities described in the preceding paragraph. However, a
Fund will generally not invest in an asset-backed security if the income
received with respect to such investment constitutes rental income or other
income not treated as qualifying income under the 90% test described in "Tax
Information" below. In general, the collateral supporting these securities is of
shorter maturity than mortgage loans and is less likely to experience
substantial prepayments in response to interest rate fluctuations.
As set forth above, several types of asset-backed and receivables-backed
securities have already been offered to investors, including, for example,
Certificates for Automobile Receivables/sm/ ("CARS/sm/") and interests in pools
of credit card receivables. CARS/sm/ represent undivided fractional interests
in a trust ("CAR Trust") whose assets consist of a pool of motor vehicle retail
installment sales contracts and security interests in the vehicles securing the
contracts. Payments of principal and interest on CARS/sm/ are passed through
monthly to certificate holders, and are guaranteed up to certain amounts and for
a certain time period by a letter of credit issued by a financial institution
unaffiliated with the trustee or originator of the CAR Trust. An investor's
return on CARS/sm/ may be affected by early prepayment of principal on the
underlying vehicle sales contracts. If the letter of credit is exhausted, the
CAR Trust may be prevented from realizing the full amount due on a sales
contract because of state law requirements and restrictions relating to
foreclosure sales of vehicles and the obtaining of deficiency judgments
following such sales or because of depreciation, damage or loss of a vehicle,
the application of federal and state bankruptcy and insolvency laws, or other
factors. As a result, certificate holders may experience delays in payments or
losses if the letter of credit is exhausted.
Asset-backed securities present certain risks that are not presented by
mortgage-backed securities. Primarily, these securities may not have the
benefit of any security interest in the related assets. Credit card receivables
are generally unsecured and the debtors are entitled to the protection of a
number of state and federal consumer credit laws, many of which give such
debtors the right to set off certain amounts owed on the credit cards, thereby
reducing the balance due. There is the possibility that recoveries on
repossessed collateral may not, in some cases, be available to support payments
on these securities.
Asset-backed securities are often backed by a pool of assets representing the
obligations of a number of different parties. To lessen the effect of failures
by obligors on underlying assets
8
<PAGE>
to make payments, the securities may contain elements of credit support which
fall into two categories: (i) liquidity protection and (ii) protection against
losses resulting from ultimate default by an obligor or servicer. Liquidity
protection refers to the provision of advances, generally by the entity
administering the pool of assets, to ensure that the receipt of payments on the
losses results from payment of the insurance obligations on at least a portion
of the assets in the pool. This protection may be provided through guarantees,
policies or letters of credit obtained by the issuer or sponsor from third
parties, through various means of structuring the transactions or through a
combination of such approaches. The degree of credit support provided for each
issue is generally based on historical information reflecting the level of
credit risk associated with the underlying assets. Delinquency or loss in
excess of that anticipated or failure of the credit support could adversely
affect the value of or return on an investment in such a security.
The availability of asset-backed securities may be affected by legislative or
regulatory developments. It is possible that such developments could require
Prime Obligations, Money Market or Premium Fund to dispose of any of their
respective existing holdings of such securities.
FORWARD COMMITMENTS AND WHEN-ISSUED SECURITIES
- ----------------------------------------------
Each Fund may purchase securities on a when-issued basis or purchase or sell
securities on a forward commitment basis. These transactions involve a
commitment by the Fund to purchase or sell securities at a future date. The
price of the underlying securities (usually expressed in terms of yield) and
the date when the securities will be delivered and paid for (the settlement
date) are fixed at the time the transaction is negotiated. When-issued
purchases and forward commitment transactions are negotiated directly with the
other party, and such commitments are not traded on exchanges, but may be traded
over-the-counter.
A Fund will purchase securities on a when-issued basis or purchase or sell
securities on a forward commitment basis only with the intention of completing
the transaction and actually purchasing or selling the securities. If deemed
advisable as a matter of investment strategy, however, a Fund may dispose of or
renegotiate a commitment after entering into it. A Fund also may sell
securities it has committed to purchase before those securities are delivered to
the Fund on the settlement date. The Fund may realize a capital gain or loss in
connection with these transactions; distributions from any net capital gains
would be taxable to its shareholders. For purposes of determining the Fund's
average dollar weighted maturity, the maturity of when-issued or forward
commitment securities will be calculated from the commitment date.
When a Fund purchases securities on a when-issued or forward commitment basis,
the Fund's custodian or subcustodian will
9
<PAGE>
maintain in a segregated account cash or liquid assets having a value
(determined daily) at least equal to the amount of the Fund's purchase
commitments. In the case of a forward commitment to sell portfolio securities
subject to such commitment, the custodian or subcustodian will hold the
portfolio securities in a segregated account while the commitment is
outstanding. These procedures are designed to ensure that the Fund will
maintain sufficient assets at all times to cover its obligations under when-
issued purchases and forward commitments.
VARIABLE AMOUNT MASTER DEMAND NOTES
- -----------------------------------
Each Fund (other than Treasury Obligations and Treasury Instruments Funds) may
purchase variable amount master demand notes. These obligations permit the
investment of fluctuating amounts at varying rates of interest pursuant to
direct arrangements between a Fund, as lender, and the borrower. Variable
amount master demand notes are direct lending arrangements between the lender
and borrower and are not generally transferable nor are they ordinarily rated.
A Fund may invest in them only if the Adviser believes that the notes are of
comparable quality to the other obligations in which the Fund may invest.
VARIABLE RATE AND FLOATING RATE DEMAND INSTRUMENTS
- --------------------------------------------------
Each Fund (other than Treasury Obligations and Treasury Instruments Funds) may
purchase variable and floating rate demand instruments that are tax exempt
municipal obligations or other debt securities that possess a floating or
variable interest rate adjustment formula. These instruments permit a Fund to
demand payment of the principal balance plus unpaid accrued interest upon a
specified number of days' notice to the issuer or its agent. The demand feature
may be backed by a bank letter of credit or guarantee issued with respect to
such instrument.
The terms of the variable or floating rate demand instruments that a Fund may
purchase provide that interest rates are adjustable at intervals ranging from
daily up to six months, and the adjustments are based upon current market
levels, the prime rate of a bank or other appropriate interest rate adjustment
index as provided in the respective instruments. Some of these instruments are
payable on demand on a daily basis or on not more than seven days' notice.
Others, such as instruments with quarterly or semiannual interest rate
adjustments, may be put back to the issuer on designated days on not more than
thirty days' notice. Still others are automatically called by the issuer unless
a Fund instructs otherwise. The Trust, on behalf of a Fund, intends to exercise
the demand only (1) upon a default under the terms of the debt security, (2) as
needed to provide liquidity to a Fund, (3) to maintain the respective quality
standards of a Fund's investment portfolio, or (4) to attain a more optimal
portfolio structure. A Fund will determine the variable or floating rate demand
instruments that it will purchase in accordance with procedures approved by the
Trustees to minimize credit risks. To
10
<PAGE>
be eligible for purchase by a Fund, a variable or floating rate demand
instrument which is unrated must have quality characteristics similar to those
of other obligations in which the Fund may invest. The Adviser may determine
that an unrated variable or floating rate demand instrument meets a Fund's
quality criteria by reason of being backed by a letter of credit or guarantee
issued by a bank that meets the quality criteria for a Fund. Thus, either the
credit of the issuer of the obligation or the guarantor bank or both will meet
the quality standards of the Fund.
The maturity of the variable or floating rate demand instruments held by a Fund
will ordinarily be deemed to be the longer of (1) the notice period required
before the Fund is entitled to receive payment of the principal amount of the
instrument or (2) the period remaining until the instrument's next interest rate
adjustment. The acquisition of variable or floating rate demand notes for a
Fund must also meet the requirements of rules issued by the SEC applicable to
the use of the amortized cost method of securities valuation. The Funds will
also consider the liquidity of the market for variable and floating rate
instruments and in the event that such instruments are illiquid, the Funds'
investments in such instruments will be subject to the limitation on illiquid
securities.
Each Fund (other than Treasury Obligations, Government, Treasury Instruments and
Federal Funds) may invest in participation interests in variable or floating
rate tax-exempt obligations held by financial institutions (usually commercial
banks). Such participation interests provide a Fund with a specific undivided
interest (up to 100%) in the underlying obligation and the right to demand
payment of its proportional interest in the unpaid principal balance plus
accrued interest from the financial institution upon a specific number of days'
notice. In addition, the participation interest generally is backed by an
irrevocable letter of credit or guarantee from the institution. The financial
institution usually is entitled to a fee for servicing the obligation and
providing the letter of credit.
RESTRICTED AND OTHER ILLIQUID SECURITIES
- ----------------------------------------
A Fund may purchase securities that are not registered ("restricted
securities") under the Securities Act of 1933, as amended ("1933 Act"),
including restricted securities offered and sold to "qualified institutional
buyers" under Rule 144A under the 1933 Act. However, a Fund will not invest
more than 10% of the value of its net assets in securities which are illiquid,
which includes fixed time deposits and repurchase agreements maturing in more
than seven days that cannot be traded on a secondary market and restricted
securities, unless, in the case of restricted securities, the Board of Trustees
determines, based upon a continuing review of the trading markets for the
specific restricted security, that such restricted securities are liquid. The
Board of Trustees may adopt guidelines and delegate to the
11
<PAGE>
Adviser the daily function of determining and monitoring liquidity of
restricted securities. The Board of Trustees, however, will retain sufficient
oversight and be ultimately responsible for the determinations. Since it is not
possible to predict with assurance that the market for securities eligible for
resale under Rule 144A will continue to be liquid, the Board of Trustees will
carefully monitor each Fund's investments in these securities, focusing on such
important factors, among others, as valuation, liquidity and availability of
information. This investment practice could have the effect of increasing the
level of illiquidity in a Fund to the extent that qualified institutional
buyers become for a time uninterested in purchasing these restricted securities.
MUNICIPAL OBLIGATIONS
- ---------------------
Prime Obligations Fund, Premium Fund, Money Market Fund, Tax-Free Fund and
Municipal Fund may invest in municipal obligations. Municipal obligations are
issued by or on behalf of states, territories and possessions of the United
States and their political subdivisions, agencies, authorities and
instrumentalities and the District of Columbia to obtain funds for various
public purposes. The interest on most of these obligations is generally exempt
from regular federal income tax. The two principal classifications of municipal
obligations are "notes" and "bonds."
Notes. Municipal notes are generally used to provide for short-term capital
needs and generally have maturities of one year or less. Municipal notes
include tax anticipation notes, revenue anticipation notes, bond anticipation
notes, tax and revenue anticipation notes, construction loan notes, tax-exempt
commercial paper and certain receipts for municipal obligations.
Tax anticipation notes are sold to finance working capital needs of
Municipalities. They are generally payable from specific tax revenues expected
to be received at a future date. They are frequently general obligations of the
issuer, secured by the taxing power for payment of principal and interest.
Revenue anticipation notes are issued in expectation of receipt of other types
of revenue such as federal or state aid. Tax anticipation notes and revenue
anticipation notes are generally issued in anticipation of various seasonal
revenues such as income, sales, use, and business taxes. Bond anticipation notes
are sold to provide interim financing in anticipation of long-term financing in
the market. In most cases, these monies provide for the repayment of the notes.
Tax-exempt commercial paper consists of short-term unsecured promissory notes
issued by a state or local government or an authority or agency thereof. The
Funds which invest in municipal obligations may also acquire securities in the
form of custodial receipts which evidence ownership of future interest payments,
principal payments or both on certain state and local governmental and authority
obligations where, in the opinion of bond counsel, interest payments with
respect to
12
<PAGE>
such custodial receipts are excluded from gross income for federal income tax
purposes. Such obligations are held in custody by a bank on behalf of the
holders of the receipts. These custodial receipts are known by various names,
including "Municipal Receipts" ("MRs") and "Municipal Certificates of Accrual on
Tax-Exempt Securities" ("M-CATS"). There are a number of other types of notes
issued for different purposes and secured differently from those described
above.
Bonds. Municipal bonds, which generally meet longer term capital needs and have
maturities of more than one year when issued, have two principal
classifications, "general obligation" bonds and "revenue" bonds.
General obligation bonds are issued by entities such as states, counties,
cities, towns and regional districts and are used to fund a wide range of public
projects including the construction or improvement of schools, highways and
roads, water and sewer systems and a variety of other public purposes. The
basic security of general obligation bonds is the issuer's pledge of its faith,
credit and taxing power for the payment of principal and interest. The taxes
that can be levied for the payment of debt service may be limited or unlimited
as to rate or amount or special assessments.
Revenue bonds have been issued to fund a wide variety of capital projects
including: electric, gas, water and sewer systems; highways, bridges and
tunnels; port and airport facilities; colleges and universities; and hospitals.
The principal security for a revenue bond is generally the net revenues derived
from a particular facility or group of facilities or, in some cases, from the
proceeds of a special excise or other specific revenue source. Although the
principal security behind these bonds varies widely, many provide additional
security in the form of a debt service reserve fund whose monies may also be
used to make principal and interest payments on the issuer's obligations.
Housing finance authorities have a wide range of security including partially
or fully insured, rent subsidized and/or collateralized mortgages, and/or the
net revenues from housing or other public projects. In addition to a debt
service reserve fund, some authorities provide further security in the form of a
state's ability (without obligation) to make up deficiencies in the debt service
reserve fund. Lease rental revenue bonds issued by a state or local authority
for capital projects are secured by annual lease rental payments from the state
or locality to the authority sufficient to cover debt service on the authority's
obligations.
Private activity bonds (a term that includes certain types of bonds, the
proceeds of which are used to a specified extent for the benefit of persons
other than governmental units), although nominally issued by municipal
authorities, are generally not secured by the taxing power of the municipality
but are secured by the revenues of the authority derived from payments by the
13
<PAGE>
industrial user. Tax-Free Fund does not intend to invest in private activity
bonds if the interest from such bonds would be an item of tax preference to
shareholders under the federal alternative minimum tax.
Municipal bonds with a series of maturity dates are called serial bonds. The
serial bonds which the Funds may purchase are limited to short-term serial
bonds--those with original or remaining maturities of thirteen months or less.
The Funds may purchase long-term bonds provided that they have a remaining
maturity of thirteen months or less or, in the case of bonds called for
redemption, the date on which the redemption payment must be made is within
thirteen months. The Funds may also purchase long-term bonds (sometimes
referred to as "Put Bonds"), which are subject to a Fund's commitment to put the
bond back to the issuer at par at a designated time within thirteen months and
the issuer's commitment to so purchase the bond at such price and time.
The Funds which invest in municipal obligations may invest in tender option
bonds. A tender option bond is a municipal obligation (generally held pursuant
to a custodial arrangement) having a relatively long maturity and bearing
interest at a fixed rate substantially higher than prevailing short-term tax-
exempt rates. The bond is typically issued in conjunction with the agreement of
a third party, such as a bank, broker-dealer or other financial institution,
pursuant to which such institution grants the security holders the option, at
periodic intervals, to tender their securities to the institution and receive
the face value thereof. As consideration for providing the option, the financial
institution receives periodic fees equal to the difference between the bond's
fixed coupon rate and the rate, as determined by a remarketing or similar agent
at or near the commencement of such period, that would cause the bond, coupled
with the tender option, to trade at par on the date of such determination. Thus,
after payment of this fee, the security holder effectively holds a demand
obligation that bears interest at the prevailing short-term tax-exempt rate.
However, an institution will not be obligated to accept tendered bonds in the
event of certain defaults by, or a significant downgrading in the credit rating
assigned to, the issuer of the bond.
The tender option will be taken into consideration in determining the maturity
of tender option bonds and the average portfolio maturity of each Fund. The
liquidity of a tender option bond is a function of the credit quality of both
the bond issuer and the financial institution providing liquidity.
Consequently, tender option bonds are deemed to be liquid unless, in the opinion
of the Adviser, the credit quality of the bond issuer and the financial
institution is deemed, in light of the relevant Fund's credit quality
requirements, to be inadequate.
Although Tax-Free Fund and Municipal Fund intend to invest in tender option
bonds the interest on which will, in the opinion of counsel for the issuer and
sponsor or counsel selected by the
14
<PAGE>
Adviser, be excluded from gross income for federal income tax purposes, there is
no assurance that the Internal Revenue Service will agree with such counsel's
opinion in any particular case. Consequently, there is a risk that a Fund will
not be considered the owner of such tender option bonds and thus will not be
entitled to treat such interest as exempt from such tax. A similar risk exists
for certain other investments subject to puts or similar rights. Additionally,
the federal income tax treatment of certain other aspects of these investments,
including the proper tax treatment of tender options and the associated fees, in
relation to various regulated investment company tax provisions is unclear.
Tax-Free Fund and Municipal Fund intend to manage their respective portfolios in
a manner designed to eliminate or minimize any adverse impact from the tax
rules applicable to these investments.
In addition to general obligation bonds, revenue bonds and serial bonds, there
are a variety of hybrid and special types of municipal obligations as well as
numerous differences in the security of municipal obligations both within and
between the two principal classifications above.
Tax-Free Fund and Municipal Fund may purchase municipal instruments that are
backed by letters of credit issued by foreign banks that have a branch, agency
or subsidiary in the United States. Such letters of credit, like other
obligations of foreign banks, may involve credit risks in addition to those of
domestic obligations, including risks relating to future political and economic
developments, nationalization, foreign governmental restrictions such as
exchange controls and difficulties in obtaining or enforcing a judgment against
a foreign bank (including branches).
For the purpose of the Funds' investment restrictions, the identification of the
"issuer" of municipal obligations that are not general obligation bonds is made
by the Adviser on the basis of the characteristics of the obligation as
described above, the most significant of which is the source of funds for the
payment of principal of and interest on such obligations.
An entire issue of municipal obligations may be purchased by one or a small
number of institutional investors such as a Fund. Thus, the issue may not be
said to be publicly offered. Unlike securities which must be registered under
the 1933 Act prior to offer and sale, unless an exemption from such registration
is available, municipal obligations which are not publicly offered may
nevertheless be readily marketable. A secondary market may exist for municipal
obligations which were not publicly offered initially.
Municipal obligations purchased for a Fund are subject to the policy on holdings
of securities which are not readily marketable contained in the Fund's
Prospectus. The Adviser determines whether a municipal obligation is liquid
based on whether it may
15
<PAGE>
be sold in a reasonable time consistent with the customs of the municipal
markets (usually seven days) at a price (or interest rate) which accurately
reflects its value. The Adviser believes that the quality standards applicable
to each Fund's investments enhance liquidity. In addition, standby commitments
and demand obligations also enhance liquidity.
Yields on municipal obligations depend on a variety of factors, including money
market conditions, municipal bond market conditions, the size of a particular
offering, the maturity of the obligation and the quality of the issue. High
quality municipal obligations tend to have a lower yield than lower rated
obligations. Municipal obligations are subject to the provisions of bankruptcy,
insolvency and other laws affecting the rights and remedies of creditors, such
as the Federal Bankruptcy Code, and laws, if any, which may be enacted by
Congress or state legislatures extending the time for payment of principal or
interest, or both, or imposing other constraints upon enforcement of such
obligations or municipalities to levy taxes. There is also the possibility that
as a result of litigation or other conditions the power or ability of any one or
more issuers to pay when due principal of and interest on its or their municipal
obligations may be materially affected.
STANDBY COMMITMENTS
- -------------------
In order to enhance the liquidity, stability or quality of municipal
obligations, Prime Obligations Fund, Premium Fund, Money Market Fund, Tax-Free
Fund and Municipal Fund may each acquire the right to sell a security to another
party at a guaranteed price and date. Such a right to resell may be referred
to as a put, demand feature or "standby commitment", depending on its
characteristics. The aggregate price which a Fund pays for securities with
standby commitments may be higher than the price which otherwise would be paid
for the securities. Standby commitments may not be available or may not be
available on satisfactory terms.
Standby commitments may involve letters of credit issued by domestic or foreign
banks supporting the other party's ability to purchase the security from the
Fund. The right to sell may be exercisable on demand or at specific intervals,
and may form part of a security or be acquired separately by the Fund. In
considering whether a security meets a Fund's quality standards, the Adviser
will look to the creditworthiness of the party providing the Fund with the right
to sell.
The Funds each value municipal obligations which are subject to standby
commitments at amortized cost. The exercise price of the standby commitments is
expected to approximate such amortized cost. No value is assigned to the
standby commitments for purposes of determining the Fund's net asset value.
Since the value of a standby commitment is dependent on the ability of the
standby commitment writer to meet its obligation to repurchase,
16
<PAGE>
the policy of each Fund that may enter into such transactions is to enter into
such transactions only with banks, brokers or dealers which represent a minimal
risk of default. The duration of standby commitments will not be a factor in
determining the weighted average maturity of a Fund.
Management of the Trust understands that the Internal Revenue Service has issued
a favorable revenue ruling to the effect that, under specified circumstances, a
registered investment company will be the owner of tax-exempt municipal
obligations acquired subject to a put option. The Internal Revenue Service has
also issued private letter rulings to certain taxpayers (which do not serve as
precedent for other taxpayers, and which are applicable only to the taxpayer
requesting the ruling and which have, on occasion, been reversed by the Internal
Revenue Service) to the effect that they are considered the owners of the
municipal obligations subject to standby commitments so that the interest on
such instruments will be tax-exempt income to them. The Internal Revenue
Service has subsequently announced that it will not ordinarily issue advance
letter rulings as to the identity of the true owner of property in cases
involving the sale of securities or participation interests therein if the
purchaser has the right to cause the security, or the participation interest
therein, to be purchased by either the seller or a third party. The Tax-Free
Fund and Municipal Fund each intends to take the position that it is the owner
of any municipal obligations acquired subject to a standby commitment or
acquired or held with certain other types of put rights and that its
distribution of tax-exempt interest earned with respect to such municipal
obligations will be tax-exempt for its shareholders. There is no assurance that
standby commitments will be available to these Funds and neither Fund has
assumed that such commitments will be available under all market conditions.
INVESTMENT LIMITATIONS
The following restrictions may not be changed with respect to any Fund without
the approval of the majority of outstanding voting securities of that Fund
(which, under the Investment Company Act and the rules thereunder and as used in
the Prospectus and this Statement of Additional Information, means the lesser of
(1) 67% of the shares of that Fund present at a meeting if the holders of more
than 50% of the outstanding shares of that Fund are present in person or by
proxy, or (2) more than 50% of the outstanding shares of that Fund). Investment
restrictions that involve a maximum percentage of securities or assets shall not
be considered to be violated unless an excess over the percentage occurs
immediately after, and is caused by, an acquisition or encumbrance of
securities or assets of, or borrowings by or on behalf of, a Fund, with the
exception of borrowings permitted by Investment Restriction (3).
17
<PAGE>
Accordingly, the Trust may not on behalf of any Fund (except for Government
Fund):
(1) make any investment inconsistent with the Fund's classification as a
diversified company under the Investment Company Act. This restriction does
not, however, apply to any Fund classified as a non-diversified company
under the Investment Company Act.
(2) purchase securities if such purchase would cause more than 25% or more in
the aggregate of the market value of the total assets of the Fund to be
invested in the securities of one or more issuers having their principal
business activities in the same industry. However, there is no limitation
with respect to, and each Fund (other than Money Market Fund and Premium
Fund) reserves freedom of action, when otherwise consistent with its
investment policies, to concentrate its investments in obligations issued
or guaranteed by the U.S. Government, its agencies or instrumentalities,
obligations (other than commercial paper) issued by U.S. banks and U.S.
branches of U.S. or foreign banks and repurchase agreements and securities
loans collateralized by such U.S. Government obligations or such bank
obligations. Each of Money Market Fund and Premium Fund may concentrate its
investments in obligations issued or guaranteed by the U.S. Government, its
agencies and instrumentalities and repurchase agreements and securities
loans collateralized by such obligations and will invest more than 25% of
its total assets in obligations issued or guaranteed by banks (whether
foreign or domestic) and repurchase agreements and securities loans
collateralized by such obligations. However, if adverse economic
conditions prevail in the banking industry, each of Money Market Fund and
Premium Fund may, for defensive purposes, temporarily invest less than 25%
of the value of its total assets in such obligations. For the purposes of
this restriction, state and municipal governments and their agencies,
authorities and instrumentalities are not deemed to be industries;
telephone companies are considered to be a separate industry from water,
gas or electric utilities; personal credit finance companies and business
credit finance companies are deemed to be separate industries; and wholly
owned finance companies are considered to be in the industry of their
parents if their activities are primarily related to financing the
activities of their parents.
(3) borrow money, except that (a) the Fund may borrow from banks (as defined in
the Investment Company Act) or through reverse repurchase agreements in
amounts up to 33 1/3/% of its total assets (including the amount borrowed),
(b) the Fund may, to the extent permitted by applicable law, borrow up to
an additional 5% of its total assets for temporary purposes, (c) the Fund
may obtain such short-term credits as may be necessary for the clearance of
purchases and sales of port-
18
<PAGE>
folio securities, and (d) the Fund may purchase securities on margin to the
extent permitted by applicable law.
(4) make loans, except through (a) the purchase of debt obligations in
accordance with each Fund's investment objective and policies, (b)
repurchase agreements with banks, brokers, dealers and other financial
institutions, and (c) loans of securities as permitted by applicable law.
(5) underwrite securities issued by others, except to the extent that the sale
of portfolio securities by a Fund may be deemed to be an underwriting.
(6) purchase, hold or deal in real estate, although a Fund may purchase and
sell securities that are secured by real estate or interests therein,
securities of real estate investment trusts and mortgage-related securities
and may hold and sell real estate acquired by a Fund as a result of the
ownership of securities.
7) invest in commodities or commodity contracts, except that the Fund may
invest in currency and financial instruments and contracts that are
commodities or commodity contracts.
(8) issue senior securities to the extent such issuance would violate
applicable law.
Government Fund may not:
(1) with respect to 75% of its total assets taken at market value, invest more
than 5% of the value of the total assets of that Fund in the securities of any
one issuer, except U.S. Government securities and repurchase agreements
collateralized by U.S. Government securities. This restriction does not,
however, apply to any Fund classified as a non-diversified company under the
Investment Company Act;
(2) with respect to 75% of its total assets taken at market value, purchase the
securities of any one issuer if, as a result of such purchase, that Fund would
hold more than 10% of the outstanding voting securities of that issuer. This
restriction does not, however, apply to any Fund classified as a non-diversified
company under the Investment Company Act;
(3) borrow money, except from banks on a temporary basis for extraordinary or
emergency purposes, provided that a Fund is required to maintain asset coverage
of 300% for all borrowings and that no purchases of securities will be made if
such borrowings exceed 5% of the value of the Fund's assets. This restriction
does not apply to cash collateral received as a result of portfolio securities
lending;
19
<PAGE>
(4) mortgage, pledge or hypothecate its assets except to secure permitted
borrowings;
(5) act as underwriter of the securities issued by others, except to the extent
that the purchase of securities in accordance with a Fund's investment
objective and policies directly from the issuer thereof and the later
disposition thereof may be deemed to be underwriting;
(6) purchase securities if such purchase would cause more than 25% in the
aggregate of the market value of the total assets of a Fund to be invested in
the securities of one or more issuers having their principal business activities
in the same industry, provided that there is no limitation with respect to, and
the Fund reserves freedom of action, when otherwise consistent with its
investment policies to, concentrate its investments in, U.S. Government
securities, obligations (other than commercial paper) issued or guaranteed by
U.S. banks, and U.S. branches of foreign banks and repurchase agreements and
securities loans collateralized by U.S. Government securities or such bank
obligations. (For the purposes of this restriction, state and municipal
governments and their agencies and authorities are not deemed to be industries,
and telephone companies are considered to be a separate industry from water, gas
or electric utilities, personal credit finance companies and business credit
finance companies are deemed to be separate industries and wholly-owned finance
companies are considered to be in the industry of their parents if their
activities are primarily related to financing the activities of their parents.
Such concentration may be effected when the Adviser determines that risk
adjusted returns in such industries are considered favorable relative to other
industries.)
(7) issue senior securities, except as appropriate to evidence indebtedness
that a Fund is permitted to incur and except for shares of existing or
additional series of the Trust;
(8) purchase or sell real estate (excluding securities secured by real estate
or interests therein), interests in oil, gas or mineral leases, commodities or
commodities contracts. The Trust reserves the freedom to hold and to sell real
estate acquired for any Fund as a result of the ownership of securities;
(9) make loans to other persons, except loans of portfolio securities and
except to the extent that the purchase of debt obligations and entry into
repurchase agreements in accordance with such Fund's investment objective and
policies may be deemed to be loans;
(10) purchase securities on margin (except for delayed delivery or when-issued
transactions or such short-term credits as are necessary for the clearance of
transactions), make short sales of securities, maintain a short position, or
invest in or write puts, calls or combinations thereof (except that a Fund may
20
<PAGE>
acquire puts in connection with the acquisition of a debt instrument);
(11) invest in other companies for the purpose of exercising control or
management.
Each Fund may, notwithstanding any other fundamental restriction or policy,
invest some or all of its assets in a single open-end investment company or
series thereof with substantially the same investment objective, restrictions
and policies as the Fund.
In addition to the fundamental policies mentioned above, the Board of Trustees
of the Trust has adopted the following non-fundamental policies which may be
changed or amended by action of the Board of Trustees without approval of
shareholders. Accordingly, the Trust may not, on the behalf of any Fund:
(a) invest in companies for the purpose of exercising control or
management.
(b) invest more than 10% of a Fund's net assets in illiquid investments
including repurchase agreements maturing in more than seven days,
securities which are not readily marketable and restricted securities
not eligible for resale pursuant to Rule 144A under the 1933 Act.
(c) purchase additional securities if the Fund's borrowings exceed 5% of
its net assets.
(d) make short sales of securities, except short sales against the box.
As money market funds, the Funds must also comply with Rule 2a-7 under the
Investment Company Act. Amendments to Rule 2a-7 have been proposed and are
expected to be effective at some time in 1997. The following assumes that such
amendments are in effect as currently proposed. While a detailed and technical
Rule, Rule 2a-7 has three basic requirements: portfolio maturity, portfolio
quality and portfolio diversification. Portfolio maturity. Rule 2a-7 requires
that the maximum maturity of any security in a Fund's portfolio may not exceed
397 days and a Fund's average portfolio maturity may not exceed 90 days.
Portfolio quality. A money market fund may only invest in First Tier and Second
Tier securities (as defined in the Rule and the Prospectus). Each Fund, other
than the Tax-Exempt Funds, as a matter of non-fundamental policy only invests
in First Tier securities. Portfolio diversification. The Prime Obligations,
Premium, Government, Treasury Obligations, Money Market, Federal, Treasury
Instruments and Tax-Free Money Market Funds may not invest more than 5% of
their total assets in the securities of any one issuer (except U.S. Government
securities, repurchase agreements collateralized by such securities and certain
securities subject to a guarantee or unconditional demand feature). Each of such
Funds may, howev-
21
<PAGE>
er, invest up to 25% of its total assets in the First Tier Securities of a
single issuer for a period of up to three business days after the purchase
thereof. Immediately after the acquisition of any put (i.e., the right to sell
the security within a specified period at a price equal to its amortized cost),
with respect to 75% of the assets of a Fund , no more than 10% of the Fund's
total assets may be invested in securities issued by or subject to puts issued
by the same issuer. In the case of the Tax-Exempt Funds (which are the only
Funds that may invest in Second Tier securities), immediately after the
acquisition of a put that is a Second Tier security, no more than 5% of the Tax-
Exempt Funds' total assets may be invested in securities or puts issued by the
institution that issued the put. The Tax-Exempt Fund's investment in Second Tier
securities that are conduit securities, which are municipal securities involving
an agreement or arrangement providing for payment by a person other than the
issuer of the municipal security, that are not subject to an unconditional
demand feature, may not exceed 5% of the Fund's total assets and the Fund's
investment in such conduit securities issued by any issuer may not exceed 1% of
the Fund's total assets. Securities which are rated in the highest short-term
rating category by at least two Nationally Recognized Statistical Rating
Organizations ("NRSROs"), or if only one NRSRO has assigned a rating, by that
NRSRO, are "First Tier Securities". Securities rated in the top two short-term
rating categories by at least two NRSROs, but which are not First Tier
Securities are "Second Tier Securities." NRSROs include S&P, Moody's, Fitch
Investors Services, Inc., Duff and Phelps, Inc., IBCA Limited and its affiliate
IBCA Inc., and Thomson BankWatch, Inc. For a description of their rating
categories, see Appendix A.
"Value" for the purposes of all investment restrictions shall mean the value
used in determining a Fund's net asset value. "U.S. Government securities"
shall mean securities issued or guaranteed by the U.S. Government or any of its
agencies, authorities or instrumentalities.
TRUSTEES AND OFFICERS
Information pertaining to the Board of Trustees and officers of the Trust is set
forth below. Trustees and officers deemed to be "interested persons" of the
Trust for purposes of the Investment Company Act are indicated by an asterisk.
22
<PAGE>
<TABLE>
<CAPTION>
NAME, AGE POSITIONS PRINCIPAL OCCUPATION(S)
AND ADDRESS WITH TRUST DURING PAST 5 YEARS
- ----------- ---------- -----------------------
<S> <C> <C>
Ashok N. Bakhru, 53 Chairman Executive Vice President -
1325 Ave. of Americas & Trustee Finance and Administration
NY, NY 10019 Chief Financial Officer, Coty
Inc. (since April 1996); President,
ABN Associates (since
June 1994); Senior Vice President
of Scott Paper Company
until June 1994; Director of
Arkwright Mutual Insurance
Company; Trustee of International
House of Philadelphia;
Member of Cornell University
Council; Trustee of the Walnut
Street Theater.
*David B. Ford, 51 Trustee Managing Director, Goldman
One New York Plaza Sachs (since 1996); General
New York, NY 10004 Partner, Goldman Sachs (1986-1996); Co-Head
of GSAM (since December 1994).
*Douglas C. Grip, 35 Trustee & Vice President, Goldman Sachs
One New York Plaza President (since May 1996);
New York, NY 10004 President, MFS Retirement
Services Inc., of Massachusetts
Financial Services
(prior thereto).
*John P. McNulty, 44 Trustee Managing Director, Goldman
One New York Plaza Sachs (since 1996); General
New York, NY 10004 Partner of Goldman Sachs (1990-1994 and
1995-1996); Co-Head of Goldman Sachs Asset
Management (since November 1995); Limited
Partner of Goldman Sachs (1994 to November
1995).
Mary P. McPherson, 60 Trustee President of Bryn Mawr College
Taylor Hall (since 1978); Director of
Bryn Mawr College Josiah Macy, Jr. Foundation
Bryn Mawr, PA 19010 (since 1977); Director of the
Philadelphia Contributionship
(since 1985); Director of
Amherst College (since 1986);
Director of Dayton Hudson
Corporation (since 1988);
</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
NAME, AGE POSITIONS PRINCIPAL OCCUPATION(S)
AND ADDRESS WITH TRUST DURING PAST 5 YEARS
- ----------- ---------- -------------------
<S> <C> <C>
Director of the Spencer
Foundation (since 1993); and
member of PNC Advisory Board
(since 1993).
*Alan A. Shuch, 48 Trustee Limited Partner, Goldman Sachs
One New York Plaza (since 1994); Director and
York, NY 10004 Vice President of Goldman Sachs Funds
Management, Inc. (from April 1990 to
November 1994); President and
Chief Operating Officer, GSAM (from
September 1988 to November 1994).
Jackson W. Smart, 66 Trustee Chairman, Executive Committee,
One Northfield Plaza First Commonwealth, Inc. (a
#218 managed dental care company,
Northfield, IL 60093 (since January 1996); Chairman and Chief
Executive Officer, MSP Communications Inc.
(a company engaged in radio broadcasting)
(since November 1988); Director, Federal
Express Corporation (since 1976), Evanston
Hospital Corporation (since 1980), First
Commonwealth, Inc. (since 1988) and North
American Private Equity Group (a venture
capital fund).
William H. Springer, 67 Trustee Vice Chairman and Chief
701 Morningside Drive Financial and Administrative
Lake Forest, IL 60045 Officer of Ameritech (a telecommunications
holding company,(February 1987 to June 1991);
Director, Walgreen Co. (a retail drug store
business); Director of Baker, Fentress &
Co. (a closed-end, management investment
company.
Richard P. Strubel, 57 Trustee Managing Director, Tandem
70 West Madison St. Partners, Inc. (since 1990);
Suite 1400 President and Chief Executive
Chicago, IL 60602 Officer, Microdot, Inc.
(a diversified manufacturer
of fastening systems and
</TABLE>
24
<PAGE>
<TABLE>
<CAPTION>
NAME, AGE POSITIONS PRINCIPAL OCCUPATION(S)
AND ADDRESS WITH TRUST DURING PAST 5 YEARS
- ----------- ---------- -------------------
<S> <C> <C>
connectors)(January 1984 to
October 1994).
*Scott M. Gilman, 37 Treasurer Director, Mutual Funds Administration,
One New York Plaza GSAM (since April 1994); Assistant
New York, NY 10004 Treasurer, Goldman Sachs Funds Management
Inc. (since March 1993); Vice President,
Goldman Sachs (since March 1990).
*John M. Perlowski, 32 Assistant Vice President, Goldman Sachs
One New York Plaza Treasurer (since July 1995); Director,
New York, NY Investors Bank and Trust
10004 Company (November 1993 to July 1995); Audit
Manager of Arthur Andersen LLP (prior
thereto).
*John W. Mosior, 58 Vice President, Goldman Sachs
4900 Sears Tower President and Manager of Shareholder
Chicago, IL Servicing of GSAM (since
60606 November 1989).
*Nancy L. Mucker, 47 Vice Vice President, Goldman Sachs;
4900 Sears Tower President Manager of Shareholder
Chicago, IL Servicing of GSAM (since
60606 November 1989).
*Michael J. Richman, 36 Secretary Associate General Counsel of
85 Broad Street GSAM (since February 1994);
New York, NY Vice President and Assistant
10004 General Counsel of Goldman
Sachs (since June 1992);
Counsel to the Funds Group,
GSAM (since June 1992);
Partner, Hale and Dorr (September
1991 to June 1992).
*Howard B. Surloff, 31 Assistant General Counsel and
85 Broad Street Secretary Vice President, Goldman Sachs
New York, NY 10004 (since November 1993 and May 1994,
respectively ); Counsel to the Funds
Group, GSAM (since
</TABLE>
25
<PAGE>
<TABLE>
<S> <C>
November 1993); Associate
of Shereff, Friedman, Hoffman & Goodman
(prior thereto).
</TABLE>
26
<PAGE>
<TABLE>
<CAPTION>
NAME, AGE POSITIONS PRINCIPAL OCCUPATION(S)
AND ADDRESS WITH TRUST DURING PAST 5 YEARS
- ----------- ---------- --------------------
<S> <C> <C>
*Valerie Zondorak, 31 Assistant Vice President, Goldman Sachs
85 Broad Street Secretary (since March 1997); Counsel to
New York, NY 10004 the Funds Group, GSAM (since
March 1997); Associate of
Shereff Friedman, Hoffman &
Goodman (prior thereto).
*Steven E. Hartstein, 33 Assistant Legal Products Analyst,
85 Broad Street Secretary Goldman Sachs (June 1993 to
New York, NY 10004 present); Funds Compliance
Officer, Citibank Global Asset
Management (August 1991 to
June 1993).
*Deborah Farrell, 25 Assistant Legal Assistant, Goldman
85 Broad Street Secretary Sachs (since January 1994).
New York, NY 10004 Formerly at Cleary Gottlieb,
Steen and Hamilton.
*Kaysie P. Uniacke, 36 Assistant Vice President and Senior
One New York Plaza Secretary Portfolio Manager, GSAM
New York, NY 10004 (since 1988).
*Elizabeth D.
Anderson, 27 Assistant Portfolio Manager, GSAM (since
One New York Plaza Secretary April 1996); Junior Portfolio
New York, NY 10004 Manager, GSAM (since 1995-
1996); Funds Trading Assis-
tant, GSAM (1993-1995); Com-
pliance Analyst, Prudential
Insurance (1991-1993).
</TABLE>
Each interested Trustee and officer holds comparable positions with certain
other investment companies of which Goldman Sachs, GSAM or an affiliate thereof
is the investment adviser, administrator and/or distributor. As of July 1,
1997, the Trustees and officers of the Trust as a group owned less than 1% of
the outstanding shares of beneficial interest of each Fund.
The Trust pays each Trustee, other than those who are "interested persons" of
Goldman Sachs, a fee for each Trustee meeting attended and an annual fee. Such
Trustees are also reimbursed for travel expenses incurred in connection with
attending such meetings.
27
<PAGE>
The following table sets forth certain information with respect to the
compensation of each Trustee of the Trust for the fiscal year ended December 31,
1996:
<TABLE>
<CAPTION>
Pension or Total
Retirement Compensation
Benefits from Goldman Sachs
Aggregate Accrued as Mutual Funds
Compensation Part of (including the
Name of Trustee from the Funds Funds' Expenses Funds)*
- --------------- -------------- --------------- ---------------------
<S> <C> <C> <C>
Paul C. Nagel, Jr.** $28,050 $0 $62,450
Ashok N. Bakhru $35,126 $0 $69,299
Marcia L. Beck*** $0 $0 $0
David B. Ford $0 $0 $0
Alan A. Shuch $0 $0 $0
Jackson W. Smart $29,198 $0 $58,954
William H. Springer $29,198 $0 $58,954
Richard P. Strubel $29,198 $0 $58,594
</TABLE>
_________________________
* The Goldman Sachs Mutual Funds consisted of 29 mutual funds, including
the five Funds in existence on December 31, 1996.
** Retired as of June 30, 1996.
*** Resigned as President and Trustee on May 1, 1996.
28
<PAGE>
THE ADVISER, DISTRIBUTOR AND TRANSFER AGENT
THE ADVISER
- -----------
GSAM, a separate operating division of Goldman Sachs, acts as the investment
adviser to the Funds. Under the Management Agreement between Goldman Sachs and
the Trust on behalf of the Funds, GSAM, subject to the supervision of the Board
of Trustees of the Trust and in conformity with the stated policies of each
Fund, acts as investment adviser and directs the investments of the Funds. In
addition, GSAM administers the Funds' business affairs and, in connection
therewith, furnishes the Trust with office facilities and (to the extent not
provided by the Trust's custodian, transfer agent, or other organizations)
clerical recordkeeping and bookkeeping services and maintains the financial and
account records required to be maintained by the Trust. As compensation for
these services and for assuming expenses related thereto, the Trust pays GSAM a
fee, computed daily and paid monthly at an annual rate of .205% of each Fund's
average daily net assets. GSAM has agreed to reduce or otherwise limit certain
other expenses (excluding management fees, fees payable to Service
Organizations, taxes, interest, brokerage and litigation, indemnification and
other extraordinary expenses) of each Fund, on an annualized basis, to .01% of
the average daily net assets of that Fund. The amount of such reductions or
limits, if any, are calculated monthly and are based on the cumulative
difference between a Fund's estimated annualized expense ratio and the expense
limit for that Fund. This amount shall be reduced by any prior payments related
to the current fiscal year. GSAM has also voluntarily agreed not to impose a
portion of its management fee.
The Trust, on behalf of each Fund, is responsible for all expenses other than
those expressly borne by GSAM under the Funds' Management Agreement. The
expenses borne by shares of each Fund include, without limitation, the fees
payable to GSAM, the fees and expenses of the Funds' custodian, fees and
expenses of the Funds' transfer agent, filing fees for the registration or
qualification of shares under federal or state securities laws, expenses of the
organization of the Funds, taxes (including income and excise taxes, if any),
interest, costs of liability insurance, fidelity bonds, indemnification or
contribution, any costs, expenses or losses arising out of any liability of, or
claim for damages or other relief asserted against, the Funds for violation of
any law, legal and auditing and tax fees and expenses (including the cost of
legal and certain accounting services rendered by employees of Goldman Sachs
with respect to the Trust), expenses of preparing and setting in type
prospectuses, statements of additional information, proxy material, reports and
notices, the printing and distribution of the same to shareholders and
regulatory authorities, their proportionate share of the compensation and
expenses of the Trust's "non-interested" Trustees, and extraordinary expenses
incurred by the Funds.
29
<PAGE>
Prior to May 1, 1997, the Funds then in operation had separate investment
advisory and administration agreements. Effective May 1, 1997 the services
under such agreements were combined in the Management Agreement. The services
required to be performed for the Funds and the combined advisory and
administration fees payable by the Funds under the former advisory and
administration agreements are identical to the services and fees under the
Management Agreement. For the fiscal years ended December 31, 1996 and December
31, 1995 and the eleven months ended December 31, 1994 the amounts of the
management fee (including both advisory and administration fees) incurred by
each Fund (other than the Premium Fund, Treasury Instruments Fund, Federal Fund
and Municipal Fund, which had not yet commenced operations) were as
follows:
<TABLE>
<CAPTION>
Dec. 1996 Dec. 1995 Dec. 1994
---------- --------- ---------
<S> <C> <C> <C>
Prime Obligations Fund $8,504,328 $7,194,392 $3,485,286
Money Market Fund/(1)/ 5,131,644 3,236,027 900,121
Treasury Obligations Fund 4,121,944 2,401,903 1,186,773
Government Fund 2,179,655 1,119,731 243,841
Tax-Free Money Market Fund/(2)/ 930,176 459,413 35,436
</TABLE>
________________________________________
/(1)/ Commenced operations May 18, 1994.
/(2)/ Commenced operations July 19, 1994.
GSAM has agreed that it will not impose a portion of its management fee. Had
such fees been imposed, the following additional fees (including both advisory
and administration fees) would have been incurred by these Funds for the periods
indicated:
<TABLE>
<CAPTION>
Dec. 1996 Dec. 1995 Dec. 1994
---------- ---------- ----------
<S> <C> <C> <C>
Prime Obligations Fund $1,750,891 $3,173,924 $1,609,383
Money Market Fund/(1)/ 1,142,133 1,063,477 482,154
Treasury Obligations Fund 848,635 1,747,326 554,447
Government Fund 448,753 493,804 159,290
Tax-Free Money Market Fund/(2)/ 219,242 304,151 109,909
- --------------------------
</TABLE>
/(1)/ Commenced operations May 18, 1994.
/(2)/ Commenced operations July 19, 1994.
The Management Agreement entered into on behalf of the Funds was most recently
approved by the Trustees, including the "non-interested" Trustees, on April 23,
1997. The Funds' shareholders approved the Management Agreement on April 21,
1997. The Management Agreement will remain in effect until June 30, 1998 and
will continue in effect thereafter only if such continuance is specifically
approved at least annually by a majority of the Trustees or by a vote of a
majority of the outstanding voting securities of the particular Fund (as defined
in the Investment Company Act) and, in either case, by a majority of "non-
interested" Trustees.
30
<PAGE>
Goldman Sachs has authorized any of its directors, partners, officers and
employees who has been elected or appointed as a Trustee or officer of the Trust
to serve in the capacities in which he or she has been elected and appointed.
In addition, GSAM assumed certain expenses related to the operations of each
Fund during various periods of 1996, 1995 and 1994 to the extent such expenses
would have caused each Fund's total expenses to exceed, on an annualized basis,
certain contractual or voluntary expense limitations. Had these expenses not
been assumed, the Funds would have incurred the following additional expenses:
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Prime Obligations Fund $637,605 $382,318 $-0-
Money Market Fund 456,796 420,234 N/A
Treasury Obligations 551,885 280,395 -0-
Government Fund 352,113 197,008 98,125
Tax-Free Money Market Fund 83,097 83,376 N/A
</TABLE>
__________________________
Each Fund may use any name derived from the name "Goldman Sachs" only as long as
its Management Agreement remains in effect. The Management Agreement also
provides that it shall terminate automatically if assigned and that it may be
terminated with respect to any particular Fund without penalty by vote of a
majority of the Trustees or a majority of the outstanding voting securities of
that Fund or by either party upon sixty (60) days' written notice to GSAM or by
GSAM without penalty at any time on 60 days' written notice to the Trust.
In managing the Tax-Free Money Market and Municipal Money Market Funds, GSAM
will draw upon the extensive research generated by Goldman Sachs' Municipal
Credit Group. The Credit Group's research team continually reviews current
information regarding the issuers of municipal and other tax-exempt securities,
with particular focus on long-term creditworthiness, short-term liquidity, debt
service costs, liability structures, and administrative and economic
characteristics.
THE DISTRIBUTOR AND TRANSFER AGENT
- ----------------------------------
Goldman Sachs acts as principal underwriter and distributor of each Fund's
shares pursuant to a Distribution Agreement with the Trust which was most
recently approved by the Board of Trustees on April 23, 1997. Goldman Sachs
also serves as the transfer agent of each Fund. Goldman Sachs provides customary
transfer agency services to the Funds, including the handling of share holder
communications, the processing of shareholder transactions, the maintenance of
shareholder account records, payment of dividends and distributions and related
functions. Goldman Sachs currently imposes no fees under its transfer agency
agreement with the Funds.
31
<PAGE>
Goldman Sachs is one of the largest international investment banking firms in
the United States. Founded in 1869, Goldman Sachs is a major investment banking
and brokerage firm providing a broad range of financing and investment services
both in the United States and abroad. As of November 29, 1996, Goldman Sachs
and its consolidated subsidiaries had assets of approximately $152 billion and
partners' capital of $5.2 billion. Goldman Sachs became registered as an
investment adviser in 1981. As of July , 1997, Goldman Sachs, together with
its affiliates, acted as investment adviser, administrator or distributor for
approximately $ billion in total assets.
ACTIVITIES OF GOLDMAN SACHS AND ITS AFFILIATES AND OTHER ACCOUNTS MANAGED BY
- ----------------------------------------------------------------------------
GOLDMAN SACHS. The involvement of the Adviser and Goldman Sachs and their
- -------------
affiliates, in the management of, or their interest in, other accounts and other
activities of Goldman Sachs may present conflicts of interest with respect to
the Funds or impede their investment activities.
Goldman Sachs and its affiliates, including, without limitation, the Adviser and
its advisory affiliates have proprietary interests in, and may manage or advise
with respect to, accounts or funds (including separate accounts and other funds
and collective investment vehicles) which have investment objectives similar to
those of the Funds and/or which engage in transactions in the same types of
securities, currencies and instruments as the Funds. Goldman Sachs and its
affiliates are major participants in the global currency, equities, swap and
fixed-income markets, in each case on a proprietary basis and for the accounts
of customers. As such, Goldman Sachs and its affiliates are actively engaged in
transactions in the same securities, currencies, and instruments in which the
Funds invest. Such activities could affect the prices and availability of the
securities, currencies, and instruments in which the Funds invest, which could
have an adverse impact on each Fund's performance. Such transactions,
particularly in respect of proprietary accounts or customer accounts other than
those included in the Adviser's and its advisory affiliates' asset management
activities, will be executed independently of the Funds' transactions and thus
at prices or rates that may be more or less favorable. When the Adviser and its
advisory affiliates seek to purchase or sell the same assets for their managed
accounts, including the Funds, the assets actually purchased or sold may be
allocated among the accounts on a basis determined in its good faith discretion
of such entitles to be equitable. In some cases, this system may adversely
affect the size or the price of the assets purchased or sold for the Funds.
From time to time, the Funds' activities may be restricted because of regulatory
restrictions applicable to Goldman Sachs and its affiliates, and/or their
internal policies designed to comply with such restrictions. As a result, there
may be periods, for example, when the Adviser, and/or its affiliates, will not
initiate or recommend certain types of transactions in
32
<PAGE>
certain securities or instruments with respect to which, or in securities of
issuers for which, the Adviser and/or its affiliates are performing services or
when position limits have been reached.
In connection with their management of the Funds, the Adviser may have access to
certain fundamental analysis and proprietary technical models developed by
Goldman Sachs and other affiliates. The Adviser will not be under any
obligation, however, to effect transactions on behalf of the Funds in accordance
with such analysis and models. In addition, neither Goldman Sachs nor any of
its affiliates will have any obligation to make available any information
regarding their proprietary activities or strategies, or the activities or
strategies used for other accounts managed by them, for the benefit of the
management of the Funds and it is not anticipated that the Advisers will have
access to such information for the purpose of managing the Funds. The
proprietary activities or portfolio strategies of Goldman Sachs and its
affiliates or the activities or strategies used for accounts managed by them or
other customer accounts could conflict with the transactions and strategies
employed by the Adviser in managing the Funds.
The results of each Fund's investment activities may differ significantly from
the results achieved by the Adviser and its affiliates for their proprietary
accounts or accounts (including investment companies or collective investment
vehicles) managed or advised by them. It is possible that Goldman Sachs and its
affiliates and such other accounts will achieve investment results which are
substantially more or less favorable than the results achieved by a Fund.
Moreover, it is possible that a Fund will sustain losses during periods in which
Goldman Sachs and its affiliates achieve significant profits on their trading
for proprietary or other accounts. The opposite result is also possible.
An investment policy committee which may include partners of Goldman Sachs and
its affiliates may develop general policies regarding a Fund's activities, but
will not be involved in the day-to-day management of such Fund. In such
instances, those individuals may, as a result, obtain information regarding the
Fund's proposed investment activities which is not generally available to the
public. In addition, by virtue of their affiliation with Goldman Sachs, any
such member of an investment policy committee will have direct or indirect
interests in the activities of Goldman Sachs and its affiliates in securities,
currencies and investments similar to those in which the Fund invests.
In addition, certain principals and certain of the employees of the Adviser are
also principals or employees of Goldman Sachs or its affiliated entities. As a
result, the performance by these principals and employees of their obligations
to such other entities may be a consideration of which investors in the Funds
should be aware.
33
<PAGE>
The Adviser may enter into transactions and invest in instruments in which
customers of Goldman Sachs serve as the counterparty, principal or issuer. In
such cases, such party's interests in the transaction will be adverse to the
interests of the Funds, and such party may have no incentive to assure that the
Funds obtain the best possible prices or terms in connection with the
transactions. Goldman Sachs and its affiliates may also create, write or issue
derivative instruments for customers of Goldman Sachs or its affiliates, the
underlying securities currencies or instruments of which may be those in which
the Funds invest or which may be based on the performance of a Fund. The Funds
may, subject to applicable law, purchase investments which are the subject of an
underwriting or other distribution by Goldman Sachs or its affiliates and may
also enter into transactions with other clients of Goldman Sachs or its
affiliates where such other clients have interests adverse to those of the
Funds. At times, these activities may cause departments of the Firm to give
advice to clients that may cause these clients to take actions adverse to the
interest of the client. To the extent affiliated transactions are permitted,
the Funds will deal with Goldman Sachs and its affiliates on an arm's-length
basis.
Each Fund will be required to establish business relationships with its
counterparties based on the Fund's own credit standing. Neither Goldman Sachs
nor its affiliates will have any obligation to allow their credit to be used in
connection with a Fund's establishment of its business relationships, nor is it
expected that a Fund's counterparties will rely on the credit of Goldman Sachs
or any of its affiliates in evaluating the Fund's creditworthiness.
From time to time, Goldman Sachs or any of its affiliates may, but is not
required to, purchase and hold shares of a Fund in order to increase the assets
of the Fund. Increasing a Fund's assets may enhance investment flexibility and
diversification and may contribute to economies of scale that tend to reduce a
Fund's expense ratio. Goldman Sachs reserves the right to redeem at any time
some or all of the shares of a Fund acquired for its own account. A large
redemption of shares of a Fund by Goldman Sachs could significantly reduce the
asset size of the Fund, which might have an adverse effect on a Fund's
investment flexibility, portfolio diversification and expense ratio. Goldman
Sachs will consider the effect of redemptions on a Fund and other shareholders
in deciding whether to redeem its shares.
PORTFOLIO TRANSACTIONS
GSAM places the portfolio transactions of the Funds and of all other accounts
managed by GSAM for execution with many firms. GSAM uses its best efforts to
obtain execution of portfolio transactions at prices which are advantageous to
each Fund and at reasonably competitive spreads or (when a disclosed commission
is being charged) at reasonably competitive commission rates. In
34
<PAGE>
seeking such execution, GSAM will use its best judgment in evaluating the terms
of a transaction, and will give consideration to various relevant factors,
including without limitation the size and type of the transaction, the nature
and character of the market for the security, the confidentiality, speed and
certainty of effective execution required for the transaction, the general
execution and operational capabilities of the broker-dealer, the general
execution and operational capabilities of the firm, the reputation, reliability,
experience and financial condition of the firm, the value and quality of the
services rendered by the firm in this and other transactions, and the
reasonableness of the spread or commission, if any. Securities purchased and
sold by the Funds are generally traded in the over-the-counter market on a net
basis (i.e., without commission) through broker-dealers and banks acting for
their own account rather than as brokers, or otherwise involve transactions
directly with the issuer of such securities.
Goldman Sachs is active as an investor, dealer and/or underwriter in many types
of municipal and money market instruments. Its activities in this regard could
have some effect on the markets for those instruments which the Funds buy, hold
or sell. An order has been granted by the SEC under the Investment Company Act
which permits the Funds to deal with Goldman Sachs in transactions in certain
taxable securities in which Goldman Sachs acts as principal. As a result, the
Funds may trade with Goldman Sachs as principal subject to the terms and
conditions of such exemption.
Under the Investment Company Act, the Funds are prohibited from purchasing any
instrument of which Goldman Sachs is a principal underwriter during the
existence of an underwriting or selling syndicate relating to such instrument,
absent an exemptive order (the order referred to in the preceding paragraph will
not apply to such purchases) or the adoption of and compliance with certain
procedures under such Act. The Trust has adopted procedures which establish,
among other things, certain limitations on the amount of debt securities that
may be purchased in any single offering and on the amount of the Trust's assets
that may be invested in any single offering. Accordingly, in view of Goldman
Sachs' active role in the underwriting of debt securities, a Fund's ability to
purchase debt securities in the primary market may from time to time be limited.
During the fiscal year ended December 31, 1996, the Trust acquired and sold
securities of its regular broker-dealers: Shearson Lehman, Chase Manhattan, Bear
Stearns Cos., Union Bank of Switzerland, Daiwa Securities America, Inc., Morgan
Stanley, Swiss Bank Corp., Smith Barney Shearson, Salomon Brothers, Inc., and
Bankers Trust. As of December 31, 1996, each Fund held the following amounts of
securities of its regular broker/dealers as defined in Rule 10b-1 under the
Investment Company Act, or their parents ($ in thousands); Prime Obligations
Fund - Bear Stearns ($149,014), Swiss Bank Corp. ($52,981), Chase Manhattan
35
<PAGE>
($246,912), Morgan Stanley & Co., Inc. ($267,039); Government Fund - Bear
Stearns ($50,000), Morgan Stanley & Co. ($138,753), Chase Manhattan ($115,627),
Swiss Bank Corp. ($62,531); Treasury Obligations Fund - Swiss Bank Corp.
($252,384), Bear Stearns ($125,000), Lehman Brothers ($125,000), Union Bank of
Switzerland ($125,000), Chase Manhattan ($466,686), Daiwa Securities ($125,000),
Morgan Stanley & Co., Inc. ($560,024), Smith Barney Inc. ($100,000); and Money
Market Fund - Swiss Bank Corp. ($36,494), Chase Manhattan ($102,482), Morgan
Stanley & Co., Inc. ($103,879).
NET ASSET VALUE
The net asset value per share of each Fund (except for Government Fund, Premium
Fund and Treasury Obligations Fund) is determined by the Funds' custodian as of
the close of regular trading on the New York Stock Exchange (normally 4:00 p.m.
New York time) (in the case of the Government Fund, Premium Fund and Treasury
Obligations Fund, net asset value is determined at 5:00 p.m. New York time) on
each Business Day. A Business Day means any day on which the New York Stock
Exchange is open, except for days on which banks in Chicago, Boston or New York
are closed on local holidays. Such holidays include: New Year's Day, Martin
Luther King Jr. Day, Presidents' Day, Good Friday, Memorial Day, the Fourth of
July, Labor Day, Columbus Day, Veteran's Day, Thanksgiving Day and Christmas
Day.
Each Fund's portfolio securities are valued using the amortized cost method of
valuation in an effort to maintain a constant net asset value of $1.00 per
share, which the Trustees have determined to be in the best interests of each
Fund and its shareholders. This method involves valuing a security at cost on
the date of acquisition and thereafter assuming a constant accretion of a
discount or amortization of a premium to maturity, regardless of the impact of
fluctuating interest rates on the market value of the instrument. While this
method provides certainty in valuation, it may result in periods during which
value, as determined by amortized cost, is higher or lower than the price a Fund
would receive if it sold the instrument. During such periods, the yield to an
investor in a Fund may differ somewhat from that obtained in a similar
investment company which uses available market quotations to value all of its
portfolio securities. During periods of declining interest rates, the quoted
yield on shares of the Funds may tend to be higher than a like computation made
by a fund with identical investments utilizing a method of valuation based upon
market prices and estimates of market prices for all of its portfolio
instruments. Thus, if the use of amortized cost by a Fund resulted in a lower
aggregate portfolio value on a particular day, a prospective investor in the
Fund would be able to obtain a somewhat higher yield if he or she purchased
shares of the Fund on that day, than would result from investment in a fund
utilizing solely market values, and existing
36
<PAGE>
investors in the Fund would receive less investment income. The converse would
apply in a period of rising interest rates.
The Trustees have established procedures designed to stabilize, to the extent
reasonably possible, each Fund's price per share as computed for the purpose of
sales and redemptions at $1.00. Such procedures include review of each Fund's
portfolio by the Trustees, at such intervals as they deem appropriate, to
determine whether such Fund's net asset value calculated by using available
market quotations (or an appropriate substitute which reflects market
conditions) deviates from $1.00 per share based on amortized cost, as well as
review of the methods used to calculate the deviation. If such deviation
exceeds 1/2 of 1%, the Trustees will promptly consider what action, if any, will
be initiated. In the event the Trustees determine that a deviation exists which
may result in material dilution or other unfair results to investors or existing
shareholders, they will take such corrective action as they regard to be
necessary and appropriate, including the sale of portfolio instruments prior to
maturity to realize capital gains or losses or to shorten average portfolio
maturity; withholding part or all of dividends or payment of distributions from
capital or capital gains; redemptions of shares in kind; or establishing a net
asset value per share by using available market quotations or equivalents. In
addition, in order to stabilize the net asset value per share at $1.00 the
Trustees have the authority (1) to reduce or increase the number of shares
outstanding on a pro rata basis, and (2) to offset each shareholder's pro rata
portion of the deviation between the net asset value per share and $1.00 from
the shareholder's accrued dividend account or from future dividends. Each Fund
may hold cash for the purpose of stabilizing its net asset value per share.
Holdings of cash, on which no return is earned, would tend to lower the yield on
such Fund's shares.
In order to continue to use the amortized cost method of valuation each Fund's
investments, including repurchase agreements, must be U.S. dollar-denominated
instruments which the Trustees determine present minimal credit risks and which
are at the time of acquisition rated by the requisite number of NRSROs in one of
the two highest short-term rating categories or, in the case of any instrument
that is not so rated, of comparable quality as determined by GSAM. Also, each
Fund must maintain a dollar-weighted average portfolio maturity (not more than
ninety (90) days) appropriate to its objective of maintaining a stable net asset
value of $1.00 per share and may not purchase any instrument with a remaining
maturity of more than thirteen (13) months. However, a Fund may also,
consistent with the provisions of the above-mentioned rule, invest in securities
with a stated maturity of more than thirteen (13) months, if (i) the security is
a floating or variable rate security with certain demand and interest rate reset
features and (ii) the security, except in the case of Tax-Free Fund and
Municipal Fund, is a First Tier Security.
37
<PAGE>
The proceeds received by each Fund for each issue or sale of its shares, and all
net investment income, realized and unrealized gain and proceeds thereof,
subject only to the rights of creditors, will be specifically allocated to such
Fund and constitute the underlying assets of that Fund. The underlying assets of
each Fund will be segregated on the books of account, and will be charged with
the liabilities in respect to that Fund and with a share of the general
liabilities of the Trust. Expenses are allocated in proportion to the net asset
values of the respective Funds except where allocations of direct expenses can
otherwise be fairly made. In addition, within each Fund, FST Shares, FST
Administration Shares, FST Service Shares and FST Preferred Shares (if any) will
be subject to different expense structures (see "Organization and
Capitalization").
REDEMPTIONS
The Trust may suspend the right of redemption of shares of a Fund and may
postpone payment for any period: (i) during which the New York Stock Exchange
is closed for regular trading other than customary weekend and holiday closings
or during which trading on the New York Stock Exchange is restricted, (ii) when
the SEC determines that a state of emergency exists which may make payment or
transfer not reasonably practicable, (iii) as the SEC may by order permit for
the protection of the shareholders of the Trust or (iv) at any other time when
the Trust may, under applicable laws and regulations, suspend payment on the
redemption of the Fund's shares.
The Trust agrees to redeem shares of each Fund solely in cash up to the lesser
of $250,000 or 1% of the net asset value of the Fund during any 90-day period
for any one shareholder. The Trust reserves the right to pay other
redemptions, either total or partial, by a distribution in kind of securities
(instead of cash) from a Fund's portfolio. The securities distributed in such a
distribution would be valued at the same value as that assigned to them in
calculating the net asset value of the shares being redeemed. If a shareholder
receives a distribution in kind, he or she should expect to incur transaction
costs when he or she converts the securities to cash.
A FST shareholder of any Fund with balances in excess of $100 million may elect
to have a special account with State Street for the purpose of redeeming shares
from its account in that Fund by check. When State Street receives a completed
signature card and authorization form, the shareholder will be provided with a
supply of checks. Checks drawn on this account may be payable to the order of
any person in any amount of $500 or more, but cannot be certified. The payee of
the check may cash or deposit it like any other check drawn on a bank. When
such a check is presented to State Street for payment, a sufficient number of
full and fractional shares will be redeemed to cover the amount of the check.
Cancelled checks will be returned to the shareholder by
38
<PAGE>
State Street. The Trust and Goldman Sachs each reserves the right to waive the
minimum requirement.
The check redemption privilege enables a shareholder to receive the dividends
declared on the shares to be redeemed until such time as the check is processed.
Because of this feature, the check redemption privilege may not be used for a
complete liquidation of an account. If the amount of a check is greater than
the value of shares held in the shareholder's account, the check will be
returned unpaid, and the shareholder may be subject to extra charges.
Goldman Sachs reserves the right to impose conditions on, limit the availability
of or terminate the check redemption privilege at any time with respect to a
particular shareholder or Service Organization in general. The Trust and State
Street reserve the right at any time to suspend the check redemption privilege
and intend to do so in the event that federal legislation or regulations impose
reserve requirements or other restrictions deemed by the Trustees to be adverse
to the interests of the Funds.
CALCULATION OF YIELD QUOTATIONS
Each Fund's yield quotations are calculated in accordance with a standard method
prescribed by the rules of the SEC. Under this method, the yield quotation is
based on a hypothetical account having a balance of exactly one share at the
beginning of a seven-day period.
Yield, effective yield and tax equivalent yield are calculated separately for
each class of a Fund's shares. Each class of shares is subject to different
fees and expenses and, consequently, may have differing yields for the same
period.
The yield quotation is computed as follows: the net change, exclusive of
capital changes (i.e., realized gains and losses from the sale of securities and
unrealized appreciation and depreciation), in the value of a hypothetical pre-
existing account having a balance of one share at the beginning of the base
period is determined by dividing the net change in value by the value of the
account at the beginning of the base period. This base period return is then
multiplied by 365/7 with the resulting yield figure carried to the nearest 100th
of 1%. Such yield quotation shall take into account all fees that are charged
to a Fund.
Each Fund also may advertise a quotation of effective yield for a seven (7)
calendar day period. Effective yield is computed by compounding the
unannualized base period return determined as in the preceding paragraph by
adding one (1) to that return, raising the sum to the 365/7 power and
subtracting one from the result, according to the following formula:
39
<PAGE>
Effective Yield=[(base period return + 1)/365/7/] - 1.
Treasury Instruments, Federal, Tax-Free and Municipal Funds may also advertise a
tax-equivalent yield which is computed by dividing that portion of a Fund's
yield (as computed above) which is tax-exempt by one minus a stated income tax
rate and adding the quotient to that portion, if any, of the yield of the Fund
that is not tax-exempt.
Unlike bank deposits or other investments which pay a fixed yield or return for
a stated period of time, the return for a Fund will fluctuate from time to time
and does not provide a basis for determining future returns. Return is a
function of portfolio quality, composition, maturity and market conditions as
well as the expenses allocated to a Fund. The return of each Fund may not be
comparable to other investment alternatives because of differences in the
foregoing variables and differences in the methods used to value portfolio
securities, compute expenses and calculate return.
The yield, effective yield and tax-equivalent yield of each Fund, with respect
to FST Shares, FST Administration Shares, FST Service Shares and FST Preferred
Shares for the seven-day period ended June 30, 1997 were as follows:
<TABLE>
<CAPTION>
Effective Tax-Equivalent
Yield Yield Yield
--------------------------------------
<S> <C> <C> <C>
Prime Obligations Fund:
FST Shares 5.52 5.67 N/A
FST Administration Shares 5.27 5.42 N/A
FST Service Shares 5.02 5.17 N/A
FST Preferred Shares 5.42 5.57 N/A
Money Market Fund:
FST Shares 5.57 5.73 N/A
FST Administration Shares 5.32 5.48 N/A
FST Service Shares 5.07 5.23 N/A
FST Preferred Shares 5.47 5.63 N/A
Treasury Obligations Fund:
FST Shares 5.39 5.54 N/A
FST Administration Shares 5.14 5.29 N/A
FST Service Shares 4.89 5.04 N/A
FST Preferred Shares 5.29 5.44 N/A
Treasury Instruments Fund:
FST Shares 5.01 5.14 N/A
FST Administration Shares 4.76 4.89 N/A
FST Service Shares 4.51 4.64 N/A
FST Preferred Shares 4.91 5.04 N/A
Government Fund:
FST Shares 5.44 5.59 N/A
FST Administration Shares 5.19 5.34 N/A
FST Service Shares 4.94 5.09 N/A
FST Preferred Shares 5.34 5.49 N/A
</TABLE>
40
<PAGE>
<TABLE>
<S> <C> <C> <C>
Federal Fund:
FST Shares 5.42 5.57 N/A
FST Administration Shares 5.17 5.32 N/A
FST Service Shares 4.92 5.07 N/A
FST Preferred Shares 5.32 5.47 N/A
Tax-Free Fund:
FST Shares 3.87 3.95 6.41
FST Administration Shares 3.62 3.70 5.99
FST Service Shares 3.37 3.45 5.58
FST Preferred Shares 3.77 3.85 6.24
</TABLE>
The information set forth in the foregoing table reflects certain fee reductions
and expense limitations voluntarily agreed to by the Adviser. See "The Adviser,
Distributor and Transfer Agent." In the absence of such fee reductions, the
yield, effective yield and the tax-equivalent yield of each Fund for the same
period would have been as follows:
<TABLE>
<CAPTION>
Effective Tax-Equivalent
Yield Yield Yield
--------------------------------
<S> <C> <C> <C>
Prime Obligations Fund:
FST Shares 5.47 5.62 N/A
FST Administration Shares 5.22 5.37 N/A
FST Service Shares 4.97 5.12 N/A
FST Preferred Shares 5.37 5.52 N/A
Money Market Fund:
FST Shares 5.53 5.68 N/A
FST Administration Shares 5.28 5.43 N/A
FST Service Shares 5.03 5.18 N/A
FST Preferred Shares 5.43 5.58 N/A
Treasury Obligations Fund:
FST Shares 5.34 5.48 N/A
FST Administration Shares 5.09 5.23 N/A
FST Service Shares 4.84 4.98 N/A
FST Preferred Shares 5.24 5.38 N/A
Treasury Instruments Fund:
FST Shares 4.86 4.98 N/A
FST Administration Shares 4.61 4.73 N/A
FST Service Shares 4.36 4.48 N/A
FST Preferred Shares 4.76 4.88 N/A
Government Fund:
FST Shares 5.40 5.54 N/A
FST Administration Shares 5.15 5.29 N/A
FST Service Shares 4.90 5.04 N/A
FST Preferred Shares 5.30 5.44 N/A
Federal Fund:
FST Shares 5.31 5.45 N/A
FST Administration Shares 5.06 5.20 N/A
FST Service Shares 4.81 4.95 N/A
FST Preferred Shares 5.21 5.35 N/A
Tax-Free Fund:
FST Shares 3.83 3.90 6.34
FST Administration Shares 3.58 3.65 5.93
FST Service Shares 3.33 3.40 5.51
FST Preferred Shares 3.73 3.80 6.18
</TABLE>
41
<PAGE>
The quotations of tax-equivalent yield set forth above for the seven-day period
ended June 30, 1997 are based on a federal marginal tax rate of 39.6%.
From time to time any Fund may publish an indication of its past performance as
measured by independent sources such as (but not limited to) Lipper Analytical
Services, Incorporated, Weisenberger Investment Companies Service, Donoghue's
Money Fund Report, Barron's, Business Week, Changing Times, Financial World,
Forbes, Money, Morningstar Mutual Funds, Micropal, Person al Investor, Sylvia
Porter's Personal Finance, and The Wall Street Journal.
The Trust may also advertise information which has been provided to the NASD for
publication in regional and local newspapers. In addition, the Trust may from
time to time advertise a Fund's performance relative to certain indices and
benchmark investments, including (without limitation): inflation and interest
rates, certificates of deposit (CDs), money market deposit accounts (MMDAs),
checking accounts, savings accounts and repurchase agreements. The Trust may
also compare a Fund's performance with that of other mutual funds with similar
investment objectives.
The composition of the investments in such mutual funds, comparative indices
and the characteristics of such benchmark investments are not identical to, and
in some cases are very different from, those of a Fund's portfolio. Indices and
averages are generally unmanaged and the items included in the calculations of
such indices and averages may not be identical to the formulas used by a Fund to
calculate its performance data.
A Fund's performance data will be based on historical results and is not
intended to indicate future performance. A Fund's performance will vary based
on market conditions, portfolio expenses, portfolio investments and other
factors. Return for a Fund will fluctuate unlike certain bank deposits or other
investments which pay a fixed yield of return.
The Trust may also, at its discretion, from time to time make a list of a Fund's
holdings available to investors upon request. The Trust may from time to time
summarize the substance of discussions contained in shareholder reports in
advertisements and publish the Adviser's views as to markets, the rationale for
a Fund's investments and discussions of a Fund's current holdings.
In addition, from time to time, quotations from articles from financial and
other publications, such as those listed above, may be used in advertisements,
sales literature and in reports to shareholders.
42
<PAGE>
In addition, from time to time, advertisements or information may include a
discussion of asset allocation models developed or recommended by GSAM and/or
its affiliates, certain attributes or potential benefits to be derived from
asset allocation strategies and the Goldman Sachs mutual funds that may form
part of such an asset allocation strategy. Such advertisements and information
may also include a discussion of GSAM's current economic outlook and domestic
and international market views and recommend periodic tactical modifications to
current asset allocation strategies. Such advertisements and information may
also highlight or summarize the services that GSAM and/or its affiliates
provide in support of an asset allocation program.
TAX INFORMATION
Each Fund has qualified and has elected or intends to qualify and elect to be
treated as a separate regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"). Such qualification does
not involve supervision of management or investment practices or policies by any
governmental agency or bureau.
In order to qualify as a regulated investment company, each Fund must, among
other things, (a) derive at least 90% oh its gross income for the taxable year
from dividends, interest, payments with respect to securities loans and gains
from the sale or other disposition of stock or securities or certain other
investments (the "90% test"); (b) derive less than 30% of its gross income for
the taxable year from the sale or other disposition of stock, securities or
certain other investments held less than three months (effective for taxable
years beginning after August 4, 1997, recently enacted federal tax
legislation -- the Taxpayer Relief Act of 1997 (the "TRA") -- repeals this
requirement); and (c) diversify its holdings so that, at the close of each
quarter of its taxable year, (i) at least 50% of the market value of the Fund's
total (gross) assets is represented by cash and cash items (including
receivables), U.S. Government securities, securities of other regulated
investment companies and other securities limited, in respect of any one issuer,
to an amount not greater in value than 5% of the value of the Fund's total
assets and not more than 10% of the outstanding voting securities of such
issuer, and (ii) not more than 25% of the value of the Fund's total (gross)
assets is invested in the securities (other than U.S. Government securities and
securities of other regulated investment companies) of any one issuer or two or
more issuers controlled by the Fund and engaged in the same, similar or related
trades or businesses. For purposes of these requirements, participation
interests will be treated as securities, and the issuer will be identified on
the basis of the market risk and credit risk associated with any particular
interest. Certain payments received with respect to such interests, such as
commitment fees and certain facility fees, may not be treated as income
qualifying under the 90% test.
43
<PAGE>
Each Fund, as a regulated investment company, will not be subject to federal
income tax on any of its net investment income and net realized capital gains
that are distributed to shareholders with respect to any taxable year in
accordance with the Code's timing and other requirements, provided that the Fund
distributes at least 90% of its investment company taxable income (generally,
all of its net taxable income other than "net capital gain," which is the excess
of net long-term capital gain over net short-term capital loss) for such year,
and in the case of any Fund that earns tax-exempt interest, at least 90% of the
excess of the tax-exempt interest it earns over certain disallowed deductions.
A Fund will be subject to federal income tax at regular corporate rates on any
investment company taxable income or net capital gain that it does not
distribute for a taxable year. In order to avoid a nondeductible 4% federal
excise tax, a Fund must distribute (or be deemed to have distributed) by
December 31 of each calendar year at least 98% of its taxable ordinary income
for such year, at least 98% of the excess of its capital gains over its capital
losses (generally computed on the basis of the one-year period ending on October
31 of such year), and all taxable ordinary income and the excess of capital
gains over capital losses for the previous year that were not distributed in
such year and on which the Fund paid no federal income tax.
Dividends paid by a Fund from taxable net investment income (including income
attributable to accrued market discount and a portion of the discount on certain
stripped tax-exempt obligations and their coupons) and the excess of net short-
term capital gain over net long-term capital loss will be treated as ordinary
income in the hands of shareholders. Such distributions will not qualify for
the corporate dividends-received deduction. Dividends paid by a Fund from the
excess of net long-term capital gain (if any) over net short-term capital loss
are taxable to shareholders as long-term capital gain, regardless of the length
of time the shares of a Fund have been held by such shareholders, and also will
not qualify for the corporate dividends-received deduction. A Fund's net
realized capital gains for a taxable year are computed by taking into account
any capital loss carryforward of that Fund. At December 31, 1996, the Funds had
approximately the following amounts of capital loss carry forwards:
Years of
Amount Expiration
------ ----------
Tax Free Money Market Fund $13,000 2004
Distributions paid by Tax-Free Fund or Municipal Fund from tax-exempt interest
received by it and properly designated as "exempt-interest dividends" will
generally be exempt from regular federal income tax, provided that at least 50%
of the value of the applicable Fund's total assets at the close of each quarter
of its taxable year consists of tax-exempt obligations, i.e., obligations
described in Section 103(a) of the Code (not including
44
<PAGE>
ing shares of other regulated investment companies that may pay exempt-interest
dividends, because such shares are not treated as tax-exempt obligations for
this purpose). Distributions paid by the other Funds from any tax-exempt
interest they may receive will not be tax-exempt, because they will not satisfy
the 50% requirement described in the preceding sentence. A portion of any tax-
exempt distributions attributable to interest on certain "private activity
bonds", if any, received by a Fund may constitute tax preference items and may
give rise to, or increase liability under, the alternative minimum tax for
particular shareholders. In addition, tax-exempt distributions of a Fund may be
considered in computing the "adjusted current earnings" preference item of its
corporate shareholders in determining the corporate alternative minimum tax. To
the extent that a Fund invests in certain short-term instruments, including
repurchase agreements, the interest on which is not exempt from federal income
tax, or earns other taxable income any distributions of income from such
investments or other taxable income will be taxable to shareholders as ordinary
income. All or substantially all of any interest on indebtedness incurred
directly or indirectly to purchase or carry shares of Tax-Free Fund or
Municipal Fund will generally not be deductible. The availability of tax-exempt
obligations and the value of these Funds may be affected by restrictive tax
legislation enacted in recent years.
In purchasing municipal obligations, Tax-Free Fund and Municipal Fund each
relies on opinions of nationally-recognized bond counsel for each issue as to
the excludability of interest on such obligations from gross income for federal
income tax purposes. Each Fund does not undertake independent investigations
concerning the tax-exempt status of such obligations, nor does it guarantee or
represent that bond counsels' opinions are correct.
Distributions of net investment income and net realized capital gains will be
taxable as described above, whether received in shares or in cash. Shareholders
electing to receive distributions in the form of additional shares will have a
cost basis in each share so received equal to the amount of cash they would have
received had they elected to receive cash.
Money Market Fund and/or Premium Fund may be subject to foreign withholding or
other foreign taxes with respect to its investments in certain securities of
foreign entities. These taxes may be reduced or eliminated under the terms of
applicable U.S. income tax treaties in some cases, and the applicable Fund
intends to satisfy any procedural requirements to qualify for benefits under
these treaties. Although neither Fund anticipates that more than 50% of the
value of its total assets at the close of a taxable year will be composed of
securities of foreign corporations, if the 50% requirement were satisfied by
either Fund, that Fund could make an election under Code Section 853 to permit
its shareholders to claim a credit or deduction on their federal income tax
returns for their pro rata portion of qualified taxes paid by the Fund in
foreign countries. In the event
45
<PAGE>
such an election is made, shareholders will be required to include their pro
rata share of such taxes in gross income and may be entitled to claim a foreign
tax credit or deduction with respect to such taxes, subject to certain
limitations under the Code. Shareholders who are precluded from taking such
credits or deductions will nevertheless be taxed on their pro rata share of the
foreign taxes included in their gross income, unless they are otherwise exempt
from federal income tax.
Each Fund will be required to report to the Internal Revenue Service all taxable
distributions, except in the case of certain exempt shareholders. Under the
backup withholding provisions of Code Section 3406, all such distributions may
be subject to withholding of federal income tax at the rate of 31% in the case
of nonexempt shareholders who fail to furnish the Fund with their taxpayer
identification number and with certain certifications required by the Internal
Revenue Service or if the Internal Revenue Service or a broker notifies a Fund
that the number furnished by the shareholder is incorrect or that the
shareholder is subject to backup withholding as a result of failure to report
interest or dividend income. However, any taxable distributions from Tax-Free
Fund or Municipal Fund will not be subject to backup withholding if the
applicable Fund reasonably estimates that at least 95% of its distributions will
be exempt interest dividends. Each Fund may refuse to accept an application
that does not contain any required taxpayer identification number or
certification that the number provided is correct, if applicable, or that the
investor is an exempt recipient. If the withholding provisions are applicable,
any such distributions, whether taken in cash or reinvested in shares, will be
reduced by the amounts required to be withheld. Investors may wish to consult
their tax advisers about the applicability of the backup withholding provisions.
Redemptions (including exchanges) and other dispositions of Fund shares in
transactions that are treated as sales for tax purposes will generally not
result in taxable gain or loss, provided that the Funds successfully maintain a
constant net asset value per share. Shareholders should consult their own tax
advisers with reference to their particular circumstances to determine whether a
redemption, exchange or other disposition of Fund shares is properly treated as
a sale for tax purposes.
All distributions (including exempt-interest dividends) whether received in
shares or cash, must be reported by each shareholder who is required to file a
federal income tax return. The Funds will inform shareholders of the federal
income tax status of their distributions after the end of each calendar year,
including, in the case of the Tax-Free Fund and the Municipal Fund, the amounts
that qualify as exempt-interest dividends and any portions of such amounts that
constitute tax preference items under the federal alternative minimum tax.
Shareholders who received exempt-interest dividends and have not held their
shares of the applicable Fund for its entire taxable year may have designated
46
<PAGE>
as tax-exempt or as a tax preference item a percentage of their distributions
which is not exactly equal to a proportionate share of the amount of tax-exempt
interest or tax preference income earned during the period of their investment
in such Fund. Each shareholder should consult his or her own tax adviser to
determine the tax consequences of an investment in the Fund in the
shareholder's own state and locality.
Different tax treatment, including penalties on certain excess contributions and
deferrals, certain pre-retirement and post-retirement distributions, and certain
prohibited transactions is accorded to accounts maintained as qualified
retirement plans. Shareholders should consult their tax advisers for more
information.
The foregoing discussion relates solely to U.S. federal income tax law as it
applies to U.S. persons (i.e., U.S. citizens and residents and U.S. domestic
corporations, partnerships, trusts and estates) subject to tax under such law.
The discussion does not address special tax rules applicable to certain classes
of investors, such as tax-exempt entities, insurance companies and financial
institutions. Each shareholder who is not a U.S. person should consult his or
her tax adviser regarding the U.S. and non-U.S. tax consequences of ownership of
shares of a Fund, including the possibility that such a shareholder may be
subject to a U.S. nonresident alien withholding tax at a rate of 30% (or at a
lower rate under an applicable U.S. income tax treaty) on certain distributions
from a Fund and, if a current IRS Form W-8 or acceptable substitute is not on
file with the Fund, may be subject to backup witholding on certain payments.
The Funds may be subject to state or local taxes in jurisdictions in which the
Funds may be deemed to be doing business. In addition, in those states or
localities which have income tax laws, the treatment of a Fund and its
shareholders under such laws may differ from their treatment under federal
income tax laws, and investment in the Funds may have tax consequences for
shareholders different from those of a direct investment in the Funds'
securities. Shareholders should consult their own tax advisers concerning these
matters. For example, in such states or localities it may be appropriate for
shareholders to review with their tax advisers the state income and, if
applicable, intangible property tax consequences of investments by the Funds in
securities issued by the particular state or the U.S. Government or its various
agencies or instrumentalities, because many states exempt from personal income
tax distributions by regulated investment companies from interest on obligations
of the particular state or on direct U.S. Government obligations and/or exempt
from intangible property tax the value of the shares of such companies
attributable to such obligations, subject to certain state-specific requirements
and/or limitations.
This discussion of the tax treatment of the Funds and their shareholders is
based on the tax laws in effect as of the date of
47
<PAGE>
this Statement of Additional Information, which are subject to change either
prospectively or retroactively.
ORGANIZATION AND CAPITALIZATION
The Funds were reorganized from series of a Massachusetts business trust as
part of Goldman Sachs Trust, a Delaware business trust, under a Declaration of
Trust dated January 28, 1997 on April 30, 1997.
The Act requires that where more than one class or series of shares exists, each
class or series must be preferred over all other classes or series in respect of
assets specifically allocated to such class or series. The Trustees also have
authority to classify and reclassify any series of shares into one or more
classes of shares. As of the date of this Statement of Additional Information,
the Trustees have authorized the issuance of up to four classes of shares of
each of the Funds: FST Shares, FST Service Shares, FST Administration Shares
and FST Preferred Shares.
Each FST Share, FST Administration Share, FST Service Share and FST Preferred
Share of a Fund represents a proportionate interest in the assets belonging to
such Fund. It is contemplated that most shares will be held in the accounts of
which the record owner is a bank or other institution acting, directly or
through an agent, as nominee for its customers who are the beneficial owners of
the shares or another organization designated by such bank or institution. FST
Shares may be purchased for accounts held in the name of an investor or
institution that is not compensated by the Fund for services provided to the
institution's investors. FST Administration Shares may be purchased for
accounts held in the name of an institution that provides certain account
administration services to its customers, including maintenance of account
records and processing orders to purchase, redeem and exchange FST
Administration Shares. FST Administration Shares of a Fund bear the cost of
administration fees at the annual rate of up to .25 of 1% of the average daily
net assets of such Shares. FST Preferred Shares may be purchased for accounts
held in the name of an institution that provides certain account administration
services to its customers, including acting directly or through an agent, as the
sole shareholder of record, maintaining account records of its customers and
processing orders to purchase, redeem and exchange FST Preferred Shares. FST
Preferred Shares of a Fund bear the cost of preferred administration fees at an
annual rate of up to 0.10% of the average daily net assets of such shares. FST
Service Shares may be purchased for accounts held in the name of an institution
that provides certain account administration and shareholder liaison services to
its customers, including maintenance of account records, processing orders to
purchase, redeem and exchange FST Service Shares, responding to customer
inquiries and assisting customers with investment procedures. FST Service
48
<PAGE>
Shares of a Fund bear the cost of service fees at the annual rate of up to 0.50%
of the average daily net assets of such shares.
It is possible that an institution or its affiliates may offer different classes
of shares (i.e., FST Shares, FST Administration Shares, FST Service Shares or
FST Preferred Shares) to its customers and thus receive different compensation
with respect to different classes of shares of each Fund. In the event a Fund
is distributed by sales persons or any other persons, they may receive different
compensation with respect to different classes of shares of a Fund. FST
Administration Shares, FST Preferred Shares and FST Service Shares each have
certain exclusive voting rights on matters relating to their respective plans.
Shares of each class may be exchanged only for shares of the same class in
another Fund. Except as described above, the four classes of shares are
identical. Certain aspects of the shares may be altered, after advance notice
to shareholders, if it is deemed necessary in order to satisfy certain tax
regulatory requirements.
When issued shares are fully paid and non-assessable. In the event of
liquidation, shareholders are entitled to share pro rata in the net assets of
the applicable class of the relevant Fund available for distribution to such
shareholders. All shares entitle their holders to one vote per share, are
freely transferable and have no preemptive subscription or conversion rights.
As of the date of this Statement of Additional Information, no shares of
Municipal Fund and Premium Fund were outstanding.
As of August 8, 1997, the entities noted below may have owned beneficially 5% or
more of the outstanding shares of Prime Obligations Fund: Commerce Bank of
Kansas City, P.O. Box 419248, BB41, Kansas City, MO 64141 (11.32%), and Citicorp
Trust NA as Custodian, 400 Royal Palm Way, Palm Beach, FL 33480 (7.26%). As of
August 8, 1997, the entities noted below may have owned beneficially 5% or more
of the outstanding shares of Money Market Fund: Account # 3814308002, 600 Third
Avenue, New York, NY 10016 (9.14%), and Citicorp Trust NA as Custodian, 400
Royal Palm Way, Palm Beach, FL 33480 (5.59%). As of August 8, 1997, the
entities noted below may have owned beneficially 5% or more of the outstanding
shares of Premium Money Market Fund: The Northwestern Mutual Life Insurance
Co., 720 E. Wisconsin Ave., Milwaukee, WI 53202-4703 (16.78%), National City
Bank, P.O. Box 5756, Cleveland, OH 44101-0756 (32.86%), MGIC, P.O. Box 297,
Milwaukee, WI 53201 (16.78%), Clark Refining & Marketing Inc., 8182 Maryland
Ave., F1 6, St. Louis, MO 63105 (16.78%), and Burlington Resourc es, Inc., 5051
Westheimer, Ste. 1400, Houston, TX 77056 (16.78%). As of August 8, 1997, the
entities noted below may have owned beneficially 5% or more of the outstanding
shares of Treasury Obligations Fund: Commerce Bank of Kansas City, NA, PO Box
248, Kansas City, MO 64141 (9.44%), Associated Bank, P.O. Box 1007, Neehah, WI
(6.66%), and Fulton Bank, P.O. Box 3215, Lancaster, PA 17604 (5.98%). As of
August 8, 1997,
49
<PAGE>
the entities noted below may have owned beneficially 5% or more of the
outstanding shares of Government Fund: Chicago Trust Company, 171 N. Clark St.,
Chicago, IL 60601 (13.89%), Mellon Bank, Three Mellon Bank Center, Pittsburgh,
PA 15258 (7.01%), Security Trust Company, P.O. Box 1589, San Diego, CA 92112-
1589 (5.66%), Burlington Resources, Inc., 5051 Westheimer, Ste. 1400, Houston,
TX 77056 (5.50%), AMBAC Capital Management Inc., 300 Nyala Farms Road, Westport,
CT 06880 (5.50%) and @ Entertainment, Inc., One Commercial Plaza, Hartford, CT
06103 (5.49%). As of August 8, 1997, the entities noted below may have owned
beneficially 5% or more of the outstanding shares of Tax-Free Fund: Mercantile
Bank of St. Louis, N.A., Mandell & Company, P.O. Box 387 aaai, St. Louis, MO
63101 (6.74%), Reliance Trust Company, P.O. Box 48449, Atlanta, GA 30362
(7.39%), International Paper Trustees, 2 Manhattanville Road, Purchase, NY 10577
(6.39%), Commerce Bank of Kansas City, P.O. Box 248, Kansas City, MO 64141
(12.48%) and Summit Bank, P.O. Box 821, Hackensack, NJ 07602 (6.32%). As of
August 8, 1997, the entities noted below may have owned beneficially 5% or more
of the outstanding shares of Federal Fund: Commerce Bank of Kansas City, P.O.
Box 419248, BB4-1, Kansas City, MO 64141 (7.37%), First National Bank of
Southwestern Ohio, P.O. Box 476, Hamilton, OH 45012 (6.90%), Mercantile Bank of
St. Louis, N.A., Mandell & Company, P.O. Box 387 MPO, St. Louis, MO 63101
(5.31%), United National Bank-WV, Parbanc Co., 514 Market St., Parkersburg, WV
26101 (6.66%), Louisville Gas & Electric Co., P.O. Box 32030, Louisville, KY
40232 (5.39%), and A.G. Edwards Trust Company, P.O. Box 66734, St. Louis, MO
63166 (6.26%). As of August 8, 1997, the entities noted below may have owned
beneficially 5% or more of the outstanding shares of Treasury Instruments Fund:
Central Bank & Trust Co., CEBANTCO, P.O. Box 1360, Lexington, KY 40590 (9.45%),
Harris Trust & Savings Bank, 200 W. Monroe Street, Fl. 12, Chicago, IL 60606
(35.04%), Northern Capital Trust of Fargo, P.O. Box 829, Fargo, ND 58102
(8.26%), William Harris Investors, Inc., 2 N. LaSalle Street, Ste. 400, Chicago,
IL 60602 (17.00%), Guaranty Bank & Trust Co., Haws & Co., P.O. Box 5847, Denver,
CO 80217 (7.85%), and A.G. Edwards Trust Company, P.O. Box 66734, St. Louis, MO
63166 *6.37%).
Rule 18f-2 under the Act provides that any matter required to be submitted by
the provisions of the Act or applicable state law, or otherwise, to the holders
of the outstanding voting securities of an investment company such as the Trust
shall not be deemed to have been effectively acted upon unless approved by the
holders of a majority of the outstanding shares of each class or series affected
by such matter. Rule 18f-2 further provides that a class or series shall be
deemed to be affected by a matter unless the interests of each class or series
in the matter are substantially identical or the matter does not affect any
interest of such class or series. However, Rule 18f-2 exempts the selection of
independent public accountants, the approval of principal distribution contracts
and the election of directors from the separate voting requirements of Rule 18f-
2.
50
<PAGE>
The Trust is not required to hold annual meetings of shareholders and does not
intend to hold such meetings. In the event that a meeting of shareholders is
held, each share of the Trust will be entitled, as determined by the Trustees,
either to one vote for each share or to one vote for each dollar of net asset
value represented by such shares on all matters presented to shareholders
including the election of Trustees (this method of voting being referred to as
"dollar based voting"). However, to the extent required by the Act or otherwise
determined by the Trustees, series and classes of the Trust will vote
separately from each other. Shareholders of the Trust do not have cumulative
voting rights in the election of Trustees. Meetings of shareholders of the
Trust, or any series or class thereof, may be called by the Trustees, certain
officers or upon the written request of holders of 10% or more of the shares
entitled to vote at such meetings. The shareholders of the Trust will have
voting rights only with respect to the limited number of matters specified in
the Declaration of Trust and such other matters as the Trustees may determine or
may be required by law.
The Declaration of Trust provides for indemnification of Trustees, officers and
agents of the Trust unless the recipient is adjudicated (i) to be liable by
reason of willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of such person's office or (ii) not to
have acted in good faith in the reasonable belief that such person's actions
were in the best interest of the Trust. The Declaration of Trust provides that,
if any shareholder or former shareholder of any series is held personally liable
solely by reason of being or having been a shareholder and not because of the
shareholder's acts or omissions or for some other reason, the shareholder or
former shareholder (or heirs, executors, administrators, legal representatives
or general successors) shall be held harmless from and indemnified against all
loss and expense arising from such liability. The Trust acting on behalf of any
affected series, must, upon request by such shareholder, assume the defense of
any claim made against such shareholder for any act or obligation of the series
and satisfy any judgment thereon from the assets of the series.
The Declaration of Trust permits the termination of the Trust or of any series
or class of the Trust (i) by a majority of the affected shareholders at a
meeting of shareholders of the Trust, series or class; or (ii) by a majority of
the Trustees without shareholder approval if the Trustees determine that such
action is in the best interest of the Trust or its shareholders. The factors
and events that the Trustees may take into account in making such determination
include (i) the inability of the Trust or any successor series or class to
maintain its assets at an appropriate size; (ii) changes in laws or regulations
governing the Trust, series or class or affecting assets of the type in which it
invests; or (iii) economic developments or trends having a significant adverse
impact on their business or operations.
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<PAGE>
The Declaration of Trust authorizes the Trustees without shareholder approval
to cause the Trust, or any series thereof, to merge or consolidate with any
corporation, association, trust or other organization or sell or exchange all or
substantially all of the property belonging to the Trust or any series thereof.
In addition, the Trustees, without shareholder approval, may adopt a master-
feeder structure by investing all or a portion of the assets of a series of the
Trust in the securities of another open-end investment company.
The Declaration of Trust permits the Trustees to amend the Declaration of Trust
without a shareholder vote. However, shareholders of the Trust have the right to
vote on any amendment (i) that would affect the voting rights of shareholders,
(ii) that is required by law to be approved by shareholders; (iii) that would
amend the voting provisions of the Declaration of Trust; or (iv) that the
Trustees determine to submit to shareholders.
The Trustees may appoint separate Trustees with respect to one or more series or
classes of the Trust's shares (the "Series Trustees"). Series Trustees may,
but are not required to, serve as Trustees of the Trust or any other series or
class of the Trust. The Series Trustees have, to the exclusion of any other
Trustees of the Delaware Trust, all the powers and authorities of Trustees under
the Trust Instrument with respect to any other series or class.
SHAREHOLDER AND TRUSTEE LIABILITY
- ---------------------------------
Under Delaware law, the shareholders of the Funds are not generally subject to
liability for the debts or obligations of the Trust. Similarly, Delaware law
provides that a series of the Trust will not be liable for the debts or
obligations of any other series of the Trust. However, no similar statutory or
other authority limiting business trust shareholder liability exists in many
other states. As a result, to the extent that a Delaware business trust or a
shareholder is subject to the jurisdiction of courts of such other states, the
courts may not apply Delaware law and may thereby subject the Delaware business
trust shareholders to liability. To guard against this risk, the Declaration of
Trust contains express disclaimer of shareholder liability for acts or
obligations of a Fund. Notice of such disclaimer will normally be given in each
agreement, obligation or instrument entered into or executed by a Fund or the
Trustees. The Declaration of Trust provides for indemnification by the relevant
Fund for all loss suffered by a shareholder as a result of an obligation of the
Fund. The Declaration of Trust also provides that a Fund shall, upon request,
assume the defense of any claim made against any shareholder for any act or
obligation of the Fund and satisfy any judgment thereon. In view of the above,
the risk of personal liability of shareholders is remote.
52
<PAGE>
In addition to the requirements under the Declaration of Trust, the Trust
provides that shareholders may bring a derivative action on behalf of the Trust
only if the following conditions are met: (a) shareholders eligible to bring
such derivative action under Delaware law who hold at least 10% of the
outstanding shares of the Fund, or 10% of the outstanding shares of the class to
which such action relates, shall join in the request of the Trustees to commence
such action; and (b) the Trustees may be afforded a reasonable amount of time to
consider such shareholder request and to investigate the basis and to employ
other advisers in considering the merit of the request and shall require an
undertaking by the shareholders making such request to reimburse the Fund for
the expense of any such advisers in the event that the Trustees determine not to
bring such action.
The Declaration of Trust further provides that the Trustees will not be liable
for errors of judgment or mistakes of fact or law, but nothing in the
Declaration of Trust protects a Trustee against liability to which he or she
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the conduct of his
or her office.
CUSTODIAN AND SUBCUSTODIAN
State Street Bank and Trust Company ("State Street") has been retained to act as
custodian of the Funds' assets and, in that capacity, maintains the accounting
records and calculates the daily net asset value per share of each Fund. Its
mailing address is P.O. Box 1713, Boston, MA 02105. State Street has appointed
The Northern Trust Company, 50 South LaSalle Street, Chicago, Illinois 60675 as
subcustodian to hold cash and certain securities purchased by the Funds.
INDEPENDENT ACCOUNTANTS
Arthur Andersen LLP, independent public accounts, One International Place, 100
Oliver Street, Boston, Massachusetts 02110, have been selected as auditors of
the Trust. In addition to audit services, Arthur Andersen LLP prepares each
Fund's federal and state tax returns, and provides consultation and assistance
on accounting, internal control and related matters.
FINANCIAL STATEMENTS
The Financial Statements of the Funds then in existence and conducting
investment operations, including the Statements of Investments as of December
31, 1996, the Statements of Assets and Liabilities as of December 31, 1996, the
related Statements of Operations for the period then ended, the Statements of
Changes in Net Assets, the Financial Highlights for the periods presented, the
Notes to the Financial Statements, and the Report of
53
<PAGE>
Independent Public Accountants, all of which are included in the December 31,
1996 Annual Report to the shareholders, are attached hereto and incorporated by
reference into this Statement of Additional Information. Unaudited financial
statements for each fund for the six months ended June 30, 1997 are also
attached hereto and incorporated by reference into this Statement of Additional
Information.
54
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
GOLDMAN SACHS TRUST
FINANCIAL SQUARE FUNDS
- -------------------------------- --------------------------------
- -------------------------------- --------------------------------
TAXABLE FUNDS
FINANCIAL SQUARE PRIME OBLIGATIONS FUND. A diversified money market portfolio
which invests in obligations of U.S. banks, commercial paper and other high
quality, short-term obligations of U.S. companies, securities of the U.S.
Government, its agencies, authorities and instrumentalities, and repurchase
agreements.
FINANCIAL SQUARE MONEY MARKET FUND. A diversified money market portfolio which
invests in obligations of U.S. banks and foreign banks, commercial paper and
other high-quality, short-term obligations of U.S. and foreign companies
payable in U.S. dollars, securities of the U.S. Government, its agencies,
authorities and instrumentalities, and repurchase agreements.
FINANCIAL SQUARE TREASURY INSTRUMENTS FUND. The Fund invests in securities
issued or guaranteed by the U.S. Treasury, the interest income from which is
generally exempt from state income taxation.
FINANCIAL SQUARE TREASURY OBLIGATIONS FUND. Rated "AAA" by Standard & Poor's
Ratings Group and "Aaa" by Moody's Investors Services, Inc., the fund invests
in securities issued or guaranteed by the U.S. Treasury which are backed by the
full faith and credit of the U.S. Government, and repurchase agreements
collateralized by such securities.
FINANCIAL SQUARE GOVERNMENT FUND. The Fund invests in securities of the U.S.
Government, its agencies, authorities and instrumentalities, and repurchase
agreements collateralized by such securities.
FINANCIAL SQUARE FEDERAL FUND. The Fund invests in securities of the U.S.
Government and certain of its agencies, authorities and instrumentalities, the
interest income from which is generally exempt from state income taxation.
TAX-EXEMPT FUND
FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND. The Fund invests in securities
issued by or on behalf of states, territories and possessions of the United
States, its political subdivisions, agencies, authorities, and
instrumentalities, and the District of Columbia, the interest from which is
exempt from federal income tax.
1
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE PRIME OBLIGATIONS FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER AND CORPORATE OBLIGATIONS--54.9%
BANK HOLDING COMPANIES
American Express Centurion Bank
$ 25,000,000 5.66% 07/08/97 $ 25,000,000
25,000,000 5.66 07/14/97 25,000,000
25,000,000 5.66 07/18/97 25,000,000
Bank One Columbus, N.A.
50,000,000 5.67 07/01/97 49,966,129
Bank One Texas
75,000,000 5.47 07/09/97 74,942,056
BankAmerica Corp.
50,000,000 5.34 08/04/97 49,747,833
Comerica Bank Detroit
65,000,000 5.59 07/07/97 64,973,624
75,000,000 5.59 07/15/97 74,959,297
Corestates Bank, N.A.
30,000,000 5.65 07/02/97 30,000,000
FCC National Bank
90,000,000 5.61 07/01/97 89,962,818
First Bank, N.A.
65,000,000 5.59 07/16/97 64,965,101
25,000,000 5.60 07/16/97 24,988,775
Southtrust Bank of Alabama, N.A.
115,000,000 5.63 07/01/97 114,972,080
BUSINESS CREDIT INSTITUTIONS
General Electric Capital Corp.
50,000,000 6.85 07/01/97 50,000,000
50,000,000 5.72 09/16/97 49,405,389
50,000,000 5.91 11/19/97 48,891,583
COMMERCIAL BANKS
CP Trust Certificates Series 1996-1
85,000,000 5.67(a) 07/01/97 85,000,000
HOME BUILDERS
International Lease Finance Corp.
150,000,000 5.62 07/02/97 149,976,583
INDUSTRIAL
Caterpillar Financial Services Corp.
25,000,000 5.39 08/26/97 24,790,389
LIFE INSURANCE
Commonwealth Life Insurance Co.
20,000,000 5.83(b) 07/01/97 20,000,000
Pacific Mutual Life Insurance Co.
50,000,000 5.71(b) 07/01/97 50,000,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER AND CORPORATE OBLIGATIONS
(CONTINUED)
LIFE INSURANCE (CONTINUED)
Prudential Funding Corp.
$100,000,000 5.54% 07/14/97 $ 99,799,944
50,000,000 5.55 08/18/97 49,630,000
MOTOR VEHICLES AND EQUIPMENT
Ford Motor Credit Corp.
100,000,000 5.35 08/18/97 99,286,667
RECEIVABLE/ASSET FINANCINGS
Corporate Receivables Corp.
40,000,000 5.65 07/02/97 39,993,722
25,000,000 5.63 07/10/97 24,964,813
25,000,000 5.57 09/09/97 24,729,236
Enterprise Funding Corp.
79,466,000 5.54 07/08/97 79,380,397
International Securitization Corp.
20,000,000 5.59 07/17/97 19,950,311
7,575,000 5.59 07/24/97 7,547,947
New Center Asset Trust
80,000,000 5.34 08/01/97 79,632,133
Receivables Capital Corp.
39,014,000 5.60 07/02/97 39,007,931
39,371,000 5.60 07/08/97 39,328,129
66,157,000 5.57 07/10/97 66,064,876
WCP Funding Corp.
40,000,000 5.55 07/30/97 39,821,167
SECURITY AND COMMODITY BROKERS, DEALERS AND SERVICES
Bankers Trust Securities Corp.
50,000,000 5.55 07/21/97 49,845,833
Bear Stearns Companies, Inc.
50,000,000 5.64 07/31/97 49,765,000
100,000,000 5.64 08/18/97 99,248,000
JP Morgan Securities, Inc.
50,000,000 5.69 07/15/97 50,000,000
Merrill Lynch & Co., Inc.
45,000,000 5.65 07/11/97 44,993,846
45,000,000 5.65 07/14/97 44,993,860
90,000,000 5.64 08/11/97 89,421,900
50,000,000 5.70 11/17/97 48,899,583
Smith Barney, Inc.
75,000,000 5.64 08/18/97 74,436,000
- ------------------------------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER AND CORPORATE OBLIGATIONS $2,453,282,952
- ------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
BANK NOTES--27.4%
American Express Centurion Bank
$ 32,000,000 5.65% 07/21/97 $ 32,000,000
Amsouth Bank of Alabama, N.A.
50,000,000 5.61 07/28/97 49,982,131
Bank One Milwaukee, N.A.
25,000,000 5.70 07/01/97 24,996,480
50,000,000 5.69 07/02/97 49,974,386
Comerica Bank Detroit
50,000,000 6.00 03/27/98 49,940,225
35,000,000 6.18 05/27/98 34,983,403
Corestates Bank, N.A.
25,000,000 5.65 07/03/97 25,000,000
25,000,000 5.66 07/04/97 25,000,000
25,000,000 5.66 07/07/97 25,000,000
Corestates Capital Corp.
25,000,000 5.65 07/23/97 25,000,000
Dakota Certificates of Standard Credit Card Master Trust
76,585,000 5.63 07/02/97 76,573,023
48,000,000 5.65 08/18/97 47,638,400
Fifth Third Bank of Northwestern Ohio
50,000,000 5.55 07/10/97 49,999,876
First Bank FSB
50,000,000 5.59 07/16/97 49,972,154
First National Bank of Boston
150,000,000 5.50 08/04/97 150,000,000
25,000,000 5.46 08/11/97 25,000,000
First National Bank of Chicago
80,000,000 5.72 08/20/97 80,000,000
First National Bank of Maryland
20,000,000 5.63(b) 07/30/97 19,998,055
Household Bank FSB
50,000,000 5.66(b) 07/23/97 49,999,240
Huntington National Bank
75,000,000 5.42 08/14/97 74,989,053
Morgan Guaranty Trust Co.
60,000,000 6.02 03/25/98 59,958,943
PNC Bank, N.A.
75,000,000 5.58 07/01/97 74,947,125
100,000,000 5.59(b) 07/01/97 99,980,191
25,000,000 5.59 07/21/97 24,990,377
- -------------------------------------------------------------------------------
TOTAL BANK NOTES $1,225,923,062
- -------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BANKERS' ACCEPTANCES--1.1%
Wachovia Bank of Georgia, N.A.
$ 50,000,000 5.54% 07/03/97 $ 49,984,612
- ----------------------------------------------------------------------------------------------
TOTAL BANKERS' ACCEPTANCES $ 49,984,612
- ----------------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT--9.6%
Crestar Bank
$ 50,000,000 5.72% 07/08/97 $ 50,000,000
First National Bank of Boston
10,000,000 5.72 07/07/97 10,000,000
Morgan Guaranty Trust Co.
75,000,000 5.91 03/19/98 74,979,491
Regions Bank
60,000,000 6.00 03/18/98 59,991,832
Union Bank of Los Angeles
150,000,000 5.54 08/27/97 150,000,000
World Savings Bank
60,000,000 5.57 07/07/97 59,999,901
25,000,000 5.61 09/19/97 24,997,809
- ----------------------------------------------------------------------------------------------
TOTAL CERTIFICATES OF DEPOSIT $ 429,969,033
- ----------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--7.1%
Joint Repurchase Agreement Account
$315,700,000 6.01% 07/01/97 $ 315,700,000
- ----------------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT $ 315,700,000
- ----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $4,474,859,659(c)
</TABLE>
- --------------------------------------------------------------------------------
(a)Variable rate security-base index is either U.S. Treasury Bill, one or three
month LIBOR, one month commercial paper, Federal Funds, or Prime lending rate.
(b)Variable rate master note-base index is Federal Funds.
(c)The amount stated also represents aggregate cost for federal income tax
purposes.
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or for floating rate securities, the
current reset rate, which is based upon current interest rate indices.
Maturity dates represent either the stated date on the security, the next
interest reset date for floating rate securities, or the prefunded date for
those types of securities.
The percentages shown for each investment category reflect the value of
investments in that category as a percentage of total net assets.
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE MONEY MARKET FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER AND CORPORATE OBLIGATIONS--54.5%
BANK HOLDING COMPANIES
American Express Centurion Bank
$ 15,000,000 5.66% 07/08/97 $ 15,000,000
15,000,000 5.66 07/14/97 15,000,000
15,000,000 5.66 07/18/97 15,000,000
Bank One Columbus, N.A.
50,000,000 5.67 07/01/97 49,966,129
Comerica Bank Detroit
55,000,000 5.59 07/07/97 54,977,682
90,000,000 5.59 07/15/97 89,951,157
Corestates Bank, N.A.
15,000,000 5.65 07/07/97 15,000,000
FCC National Bank
110,000,000 5.61 07/01/97 109,954,556
First Bank, N.A.
25,000,000 5.60 07/16/97 24,988,775
Southtrust Bank of Alabama, N.A.
75,000,000 5.63 07/01/97 74,981,791
BUSINESS CREDIT INSTITUTIONS
General Electric Capital Corp.
75,000,000 6.75 07/01/97 75,000,000
90,000,000 5.76 08/04/97 90,000,000
COMMERCIAL BANKS
CP Trust Certificates Series 1996-1
60,000,000 5.67(a) 07/01/97 60,000,000
CP Trust Certificates Series 1996-2
50,000,000 5.70(a) 07/01/97 50,000,000
FOREIGN BANKS
Abbey National
150,000,000 5.57 07/15/97 149,887,942
ABN/AMRO Bank, New York
60,000,000 5.62 07/01/97 59,987,388
Banca Crt Financial Corp.
11,150,000 5.65 07/08/97 11,137,750
29,000,000 5.40 09/02/97 28,725,950
Bayerische Landesbank
15,000,000 5.56 07/28/97 14,988,491
BCI Funding Corp.
50,000,000 5.64 07/10/97 49,929,563
50,000,000 5.64 08/13/97 49,663,167
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER AND CORPORATE OBLIGATIONS
(CONTINUED)
FOREIGN BANKS (CONTINUED)
Bex America Finance, Inc.
$ 34,000,000 5.40% 08/01/97 $ 33,841,900
38,000,000 5.64 08/12/97 37,749,960
Den Danske Bank, New York
25,000,000 5.64 07/01/97 24,996,173
35,000,000 5.64 07/25/97 34,996,661
Indosuez North America, Inc.
72,205,000 5.65 07/07/97 72,137,007
50,000,000 5.63 07/11/97 49,921,806
Nordbanken North America
100,000,000 5.64 07/02/97 99,984,333
60,000,000 5.39 08/01/97 59,721,517
San Paolo U.S. Finance Corp.
50,000,000 5.66 07/21/97 49,842,778
37,000,000 5.70 11/24/97 36,144,683
Societe Generale, New York
40,000,000 5.64 07/01/97 39,993,424
LIFE INSURANCE
Sunamerica Life Insurance Co.
50,000,000 5.81(b) 07/01/97 50,000,000
MORTGAGE BROKERS
Nationwide Building Society
50,000,000 5.66 08/01/97 49,756,306
25,000,000 5.34 08/05/97 24,870,208
25,000,000 5.34 08/11/97 24,847,958
MOTOR VEHICLES AND EQUIPMENT
General Motors Acceptance Corp.
40,000,000 5.40 08/04/97 39,796,000
50,000,000 5.42 08/04/97 49,744,056
65,000,000 5.81 10/08/97 63,961,463
RECEIVABLE/ASSET FINANCINGS
Asset Securitization Corp.
74,000,000 5.63 07/02/97 73,988,427
60,000,000 5.65 08/19/97 59,538,583
15,000,000 5.65 08/21/97 14,879,938
Beta Finance
30,000,000 5.63 08/14/97 29,793,567
CC USA, Inc.
48,000,000 5.63 07/15/97 47,894,907
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMERCIAL PAPER AND CORPORATE OBLIGATIONS (CONTINUED)
RECEIVABLE/ASSET FINANCINGS (CONTINUED)
CC U.S.A. Inc. (continued)
$ 30,000,000 5.39% 08/26/97 $ 29,748,467
Eureka Securities
25,000,000 5.63 08/11/97 24,839,701
SECURITY AND COMMODITY BROKERS, DEALERS AND SERVICES
JP Morgan Securities, Inc.
50,000,000 5.69 07/15/97 50,000,000
Merrill Lynch & Co., Inc.
35,000,000 5.65 07/11/97 34,995,214
35,000,000 5.65 07/14/97 34,995,225
120,000,000 5.70 11/17/97 117,359,000
Smith Barney, Inc.
25,000,000 5.64 08/18/97 24,812,000
TELECOMMUNICATIONS
Ameritech Corp.
17,000,000 5.89 08/12/97 17,011,987
- ------------------------------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER AND CORPORATE OBLIGATIONS $2,506,303,590
- ------------------------------------------------------------------------------------------------
BANK NOTES--11.2%
Amsouth Bank of Alabama, N.A.
$ 50,000,000 5.62% 07/15/97 $ 49,980,619
Bank One Columbus, N.A.
25,000,000 5.69 07/02/97 24,987,193
Bankers Trust Co., New York
69,500,000 5.70 07/01/97 69,493,448
First Bank FSB
50,000,000 5.59 07/16/97 49,972,154
First Bank, N.A.
50,000,000 5.60 07/16/97 49,974,424
First National Bank of Maryland
30,000,000 5.63(b) 07/28/97 29,997,211
25,000,000 5.63(b) 07/30/97 24,997,569
Household Bank FSB
25,000,000 5.66(b) 07/23/97 24,999,425
Nationsbank Corp.
24,000,000 5.93 09/29/97 24,028,977
PNC Bank, N.A.
25,000,000 5.58 07/01/97 24,982,375
50,000,000 5.59(b) 07/01/97 49,990,096
42,000,000 5.59(b) 07/03/97 41,994,084
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BANK NOTES (CONTINUED)
Southtrust Bank of Alabama, N.A.
$ 50,000,000 5.62%(b) 07/11/97 $ 49,999,157
- ------------------------------------------------------------------------------------------------
TOTAL BANK NOTES $ 515,396,732
- ------------------------------------------------------------------------------------------------
BANKERS' ACCEPTANCES--0.4%
Royal Bank of Canada, New York
$ 18,419,195 5.65% 09/02/97 $ 18,237,069
- ------------------------------------------------------------------------------------------------
TOTAL BANKERS' ACCEPTANCES $ 18,237,069
- ------------------------------------------------------------------------------------------------
CERTIFICATES OF DEPOSIT - YANKEEDOLLAR--27.3%
Bank of Tokyo, Mitsubishi Bank Ltd., New York
$ 50,000,000 5.80% 07/02/97 $ 49,999,984
Banque National de Paris, New York
50,000,000 5.75 08/19/97 50,000,336
Canadian Imperial Bank of Commerce, New York
63,000,000 5.94 03/17/98 62,987,174
Den Danske Bank, New York
25,000,000 5.64 07/15/97 24,994,539
50,000,000 5.64 07/16/97 49,992,320
Fuji Bank, New York
100,000,000 5.67 07/07/97 100,000,000
National Bank of Canada, New York
20,000,000 5.91 09/10/97 20,009,715
50,000,000 6.03 03/18/98 49,992,849
Norinchukin Bank, New York
70,000,000 5.77 07/07/97 70,000,116
65,000,000 5.78 07/07/97 65,000,215
25,000,000 5.74 07/28/97 25,000,186
45,000,000 5.71 08/18/97 45,000,594
Rabobank Nederland, New York
50,000,000 6.07 03/26/98 49,985,980
45,000,000 6.05 03/27/98 44,962,026
Sanwa Bank Limited, New York
200,000,000 5.75 08/21/97 200,002,795
Societe Generale, New York
50,000,000 5.49 08/11/97 50,000,554
50,000,000 5.55 09/02/97 50,000,000
25,000,000 6.05 03/24/98 24,991,302
Standard Chartered Bank, New York
25,000,000 5.75 07/01/97 25,000,000
50,000,000 5.73 08/15/97 50,000,616
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE MONEY MARKET FUND (continued)
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CERTIFICATES OF DEPOSIT - YANKEEDOLLAR (CONTINUED)
Sumitomo Bank, Los Angeles
$ 70,000,000 5.70% 07/10/97 $ 70,000,825
Westdeutsche Landesbank, New York
80,000,000 5.70 08/13/97 80,000,000
- ----------------------------------------------------------------------------------------------
TOTAL CERTIFICATES OF DEPOSIT - YANKEEDOLLAR $1,257,922,126
- ----------------------------------------------------------------------------------------------
TAXABLE MUNICIPAL NOTES--0.6%
Florida Housing Finance Authority
$ 28,600,000 5.63%(b) 07/07/97 $ 28,600,000
- ----------------------------------------------------------------------------------------------
TOTAL TAXABLE MUNICIPAL NOTES $ 28,600,000
- ----------------------------------------------------------------------------------------------
TIME DEPOSIT--4.3%
Norwest Bank of Minnesota, N.A.
$200,000,000 6.00% 07/01/97 $ 200,000,000
- ----------------------------------------------------------------------------------------------
TOTAL TIME DEPOSIT $ 200,000,000
- ----------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--1.7%
Joint Repurchase Agreement Account
$ 79,600,000 6.01% 07/01/97 $ 79,600,000
- ----------------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT $ 79,600,000
- ----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $4,606,059,517(c)
- ----------------------------------------------------------------------------------------------
</TABLE>
(a)Variable rate security-base index is either U.S. Treasury Bill, one or three
month LIBOR, one month commercial paper, Federal Funds, or Prime lending rate.
(b)Variable rate master note-base index is Federal Funds.
(c)The amount stated also represents aggregate cost for federal income tax
purposes.
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or, for floating rate securities, the
current reset rate, which is based upon current interest rate indices.
Maturity dates represent either the stated date on the security, the next
interest reset date for floating rate securities, or the prerefunded date for
those types of securities.
The percentages shown for each investment category reflect the value of
investments in that category as a percentage of total net assets.
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE TREASURY OBLIGATIONS FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. TREASURY OBLIGATIONS--10.2%
United States Treasury Notes
$ 40,000,000 5.25% 12/31/97 $ 39,950,497
50,000,000 7.25 02/17/98 50,450,535
60,000,000 5.13 03/02/98 59,727,000
70,000,000 6.13 03/31/98 70,126,405
87,000,000 7.88 04/15/98 88,217,136
- ---------------------------------------------------------------------------------------------------
TOTAL U.S. TREASURY OBLIGATIONS $308,471,573
- ---------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--90.0%
Bear Stearns Companies, Inc., dated 06/30/97, repurchase price $130,021,486
(U.S. Treasury Stripped Securities: $132,745,998, 08/15/98-08/15/02)
$130,000,000 5.95% 07/01/97 $130,000,000
BT Securities, dated 06/30/97, repurchase price $130,020,764 (U.S. Treasury
Notes; $132,601,430, 6.375%-6.75%, 06/30/99-07/15/99)
130,000,000 5.75 07/01/97 130,000,000
Chase Manhattan Securities, dated 06/30/97, repurchase price $130,021,306
(U.S. Treasury Notes: $132,601,139, 5.0%-8.87%, 02/15/99-03/31/99)
130,000,000 5.90 07/01/97 130,000,000
CIBC Wood Gundy Securities, dated 06/30/97, repurchase price $130,021,215
(U.S. Treasury Notes: $132,602,343, 5.625%-6.25%, 08/31/97-07/31/98)
130,000,000 5.88 07/01/97 130,000,000
Dresdner Kleinwort Benson, dated 06/30/97, repurchase price $130,021,306
(U.S. Treasury Note: $132,602,740, 6.00%, 6/30/99)
130,000,000 5.90 07/01/97 130,000,000
Goldman, Sachs & Co., dated 06/19/97, repurchase price $201,830,000 (U.S.
Treasury Note: $63,464,539, 6.0%, 06/30/99; U.S. Treasury Bond:
$140,535,465, 11.125%, 08/15/03)
200,000,000 5.49 08/18/97 200,000,000
Goldman, Sachs & Co., dated 06/09/97, repurchase price $202,185,222 (U.S.
Treasury Notes: $204,000,016, 6.625%-7.0%, 07/15/06-05/15/07)
200,000,000 5.54 08/19/97 200,000,000
JP Morgan Securities, Inc., dated 06/30/97, repurchase price $130,021,486
(U.S. Treasury Notes: $132,927,593, 7.5%, 11/15/01)
130,000,000 5.95 07/01/97 130,000,000
Lehman Government Securities, Inc., dated 06/30/97, repurchase price
$50,008,194 (U.S. Treasury Stripped Securities: 51,002,558,
11/15/00-02/15/03)
50,000,000 5.90 07/01/97 50,000,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Merrill Lynch Government Securities, Inc, dated 6/30/97, repurchase
price $130,020,583 (U.S. Treasury Notes: $132,601,532, 7.5%-9.125%,
08/15/97-05/15/02)
$130,000,000 5.70% 07/01/97 $130,000,000
Morgan Stanley & Co., dated 06/30/97, repurchase price $130,020,764
(U.S. Treasury Notes: $132,700,694, 4.75%-8.875%, 08/31/97-08/31/01)
130,000,000 5.75 07/01/97 130,000,000
Nomura Securities International, Inc., dated 06/30/97, repurchase price
$130,020,764 (U.S. Treasury Notes: $132,527,624, 5.62%-6.25%, 10/31/97-
06/30/98)
130,000,000 5.75 07/01/97 130,000,000
Sanwa Securities, dated 06/30/97, repurchase price $130,020,944 (U.S.
Treasury Notes: $132,600,690, 6.25%-8.75%, 11/15/99-05/15/06)
130,000,000 5.80 07/01/97 130,000,000
SBC Warburg, Inc., dated 06/30/97, repurchase price $52,808,697 (U.S.
Treasury Notes: $43,937,914, 5.625%-6.5%, 08/31/97-02/15/06; U.S.
Treasury Bonds: $10,584,692, 9.375%-14.25%, 02/15/02-02/15/06)
52,800,000 5.93 07/01/97 52,800,000
Smith Barney, Inc., dated 06/30/97, repurchase price $130,021,486 (U.S.
Treasury Bill: $11,022,211, 07/31/97; U.S. Treasury Stripped
Securities: $42,330,457, 02/15/98-11/15/04; U.S. Treasury Notes:
$79,248,155, 5.0%-7.75%, 01/31/99-03/31/02)
130,000,000 5.95 07/01/97 130,000,000
UBS Securities, Inc., dated 06/30/97, repurchase price $130,021,486
(U.S. Treasury Note: $132,601,398, 5.0%, 02/15/99)
130,000,000 5.95 07/01/97 130,000,000
Joint Repurchase Agreement Account
650,500,000 6.01 07/01/97 650,500,000
- ----------------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS $2,713,300,000
- ----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $3,021,771,573(a)
- ----------------------------------------------------------------------------------------------
</TABLE>
(a)The amount stated also represents aggregate cost for federal income tax
purposes.
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or, for floating rate securities, the
current reset rate, which is based upon current interest rate indices.
The percentages shown for each investment category reflect the value of the
investments in that category as a percentage of total net assets.
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE TREASURY INSTRUMENTS FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. TREASURY OBLIGATIONS--99.2%
United States Treasury Bills
$ 15,800,000 4.65% 07/03/97 $ 15,795,918
4,600,000 4.75 07/03/97 4,598,786
1,000,000 4.58 07/17/97 997,964
5,000,000 4.87 07/24/97 4,984,443
6,900,000 4.85 07/31/97 6,872,113
3,600,000 4.89 07/31/97 3,585,330
20,000,000 5.02 08/14/97 19,877,289
50,800,000 5.05 08/14/97 50,486,451
United States Treasury Notes
50,000,000 5.88 07/31/97 50,031,466
10,000,000 6.50 08/15/97 10,013,359
40,000,000 6.00 08/31/97 40,024,162
65,000,000 5.75 09/30/97 65,061,598
- -------------------------------------------------------------------------------------------------
TOTAL U.S. TREASURY OBLIGATIONS $272,328,879
- -------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $272,328,879(a)
- -------------------------------------------------------------------------------------------------
</TABLE>
(a)The amount stated also represents aggregate cost for federal income tax
purposes.
The percentages shown for each category reflect the value of investments in
that category as a percentage of total net assets.
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE GOVERNMENT FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS--47.4%
Federal Farm Credit Bank
$ 38,500,000 5.60%(a) 11/03/97 $ 38,507,992
25,000,000 5.45(a) 03/03/98 24,901,135
75,000,000 5.49(a) 04/14/98 74,947,827
Federal Home Loan Bank
30,000,000 5.66 09/05/97 29,694,750
15,000,000 5.45(a) 11/12/97 14,994,186
20,000,000 5.42(a) 12/02/97 19,987,697
50,000,000 5.52(a) 12/26/97 49,979,762
41,000,000 5.51(a) 03/06/98 40,979,288
59,000,000 5.51(a) 03/18/98 58,969,291
100,000,000 5.51(a) 04/14/98 99,945,895
Federal Home Loan Mortgage Corp.
20,000,000 5.72(a) 03/17/98 19,981,607
Federal National Mortgage Association
100,000,000 5.52(a) 09/12/97 99,982,960
50,000,000 5.26(a) 09/29/97 49,993,869
12,500,000 5.53(a) 10/29/97 12,498,056
75,000,000 5.53(a) 12/03/97 74,978,272
40,000,000 5.52 01/15/98 39,986,987
20,000,000 5.71 03/18/98 19,981,479
20,000,000 5.79 03/25/98 19,971,588
40,000,000 6.02 04/15/98 39,966,860
30,000,000 5.89 05/21/98 29,978,035
100,000,000 5.49(a)(b) 07/15/98 99,936,750
Student Loan Marketing Association
19,200,000 5.50 10/24/97 19,199,151
- ---------------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS $979,363,437
- ---------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--57.6%
Bear Stearns Companies, Inc., dated 6/30/97, repurchase price
$75,012,396 (GNMA: $78,000,950, 7.50%-8.00%, 02/15/25-08/15/25)
$ 75,000,000 5.95% 07/01/97 $ 75,000,000
CS First Boston Corp., dated 05/23/97, repurchase price $100,926,667
(FNMA: $103,620,392, 6.75%-6.79%, 09/01/34-03/01/35)
100,000,000 5.56 07/22/97 100,000,000
Goldman, Sachs & Co., dated 06/20/97, repurchase price $100,923,333
(FNMA: $91,400,123, 5.5%-8.0%, 10/01/97-06/01/07, FMAC: $10,599,877,
5.5%-13.5%, 11/01/97-06/01/07)
100,000,000 5.54 08/19/97 100,000,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Lehman Government Securities, Inc., dated 06/30/97, repurchase price
$54,708,965 (U.S. Treasury Stripped Securities: $55,796,251, 05/15/99-
11/15/00)
$ 54,700,000 5.90% 07/01/97 $ 54,700,000
Merrill Lynch Government Securities, Inc., dated 06/30/97, repurchase
price $25,003,958 (FNMA: $25,447,483, 5.632%, 11/25/97; FHLMC: $55,027,
5.30%, 10/26/98)
25,000,000 5.70 07/01/97 25,000,000
Morgan Stanley Group, Inc., dated 05/23/97, repurchase price
$100,926,667 (FGCI: $45,097,480, 6.0%-8.0%, 08/01/08-05/01/12; FGLMC:
$25,204,481, 6.5%-8.5%, 03/01/25-01/01/26; FGSB: $31,885,675, 6.5%-
8.0%, 07/01/01-01/01/04; FNCL: $62,097, 6.5%, 12/01/25; FNCI: $62,070,
7.0%, 03/01/08)
100,000,000 5.56 07/22/97 100,000,000
Nomura Securities International, Inc., dated 06/30/97, repurchase price
$325,054,618 (U.S. Treasury Notes: $14,710,695, 5.00%-8.25%, 08/15/97-
10/15/06; U.S. Treasury Bonds: $1,690,180, 9.375%-11.125%, 08/15/03-
02/15/06; TVA: $2,580,358, 6.58%-6.875%, 04/09/99-01/15/02; SLMA:
$10,770,650, 6.115%-6.365%, 08/12/98-01/28/99; FNMA: $117,276,185,
5.30%-9.55%, 07/25/97-06/26/07; FMAC: $65,469,251 5.37%-8.61%,
07/30/97-07/31/06; FHLB: $105,996,953, 4.86%-8.03%, 07/02/97-06/19/07;
FCSB: $13,006,144, 5.86%-7.51%, 10/09/97-10/10/00)
325,000,000 6.05 07/01/97 325,000,000
SBC Warburg, Inc., dated 06/30/97, repurchase price $50,008,236 (U.S.
Treasury Notes: $47,307,879, 5.125%-6.625%, 03/31/98-07/31/01; U.S.
Treasury Bonds: $5,188,694, 12.0%-14.25%, 02/15/02-05/15/05)
50,000,000 5.93 07/01/97 50,000,000
Joint Repurchase Agreement Account(c)
361,000,000 6.01 07/01/97 361,000,000
- ----------------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS $1,190,700,000
- ----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $2,170,063,437(d)
- ----------------------------------------------------------------------------------------------
</TABLE>
(a)Variable rate security-base index is either Federal Funds, Prime lending
rate, or one month LIBOR.
(b)When-issued security.
(c)Portion of this security is being segregated for when issued securities.
(d)The amount stated also represents aggregate cost for federal income tax
purposes.
The percentages shown for each investment category reflect the value of
investments in that category as a percentage of total net assets.
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or, for floating rate securities, the
current reset rate, which is based upon current interest rate indices.
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE FEDERAL FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS--107.0%
Federal Farm Credit Bank
$ 8,600,000 5.43% 07/02/97 $ 8,598,702
18,900,000 5.39 07/07/97 18,883,022
12,200,000 5.40 07/10/97 12,183,530
23,495,000 5.42 07/15/97 23,445,478
10,000,000 5.48 07/24/97 9,964,989
12,765,000 5.48 07/25/97 12,718,365
23,075,000 5.40 07/29/97 22,978,085
13,800,000 5.51 08/11/97 13,713,401
4,300,000 5.51 08/14/97 4,271,042
1,700,000 5.51 08/19/97 1,687,250
16,000,000 5.46 08/21/97 15,876,353
35,000,000 5.46 08/25/97 34,708,042
8,255,000 5.61 10/20/97 8,112,209
18,785,000 5.61 11/03/97 18,419,084
10,000,000 5.61 11/04/97 9,803,650
10,000,000 5.45 03/03/98 9,960,518
75,000,000 5.49 04/14/98 74,947,827
Federal Home Loan Bank
11,100,000 5.43 07/07/97 11,089,955
46,300,000 5.42 07/24/97 46,139,673
50,000,000 5.45 07/30/97 49,780,486
35,000,000 5.50 07/31/97 34,839,583
18,400,000 5.44 08/01/97 18,313,806
20,000,000 5.67 08/01/97 20,000,000
11,355,000 5.43(a) 08/14/97 11,279,641
22,580,000 5.45(a) 08/14/97 22,429,592
34,330,000 5.54(a) 08/14/97 34,097,548
11,100,000 5.45 08/28/97 11,002,536
28,805,000 5.46 08/28/97 28,551,612
8,700,000 5.47 08/28/97 8,623,329
20,000,000 5.62 10/30/97 19,622,211
25,000,000 5.51 03/06/98 24,987,371
25,000,000 5.51 04/14/98 24,985,508
65,000,000 5.47(b) 07/02/98 64,943,073
Student Loan Marketing Association
25,000,000 5.42 07/31/97 24,887,083
13,500,000 5.43 08/01/97 13,436,876
25,000,000 5.44 08/01/97 24,882,889
25,000,000 5.43 08/15/97 24,830,313
25,000,000 5.42 08/29/97 24,778,135
25,000,000 5.42 09/29/97 24,661,250
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENCY OBLIGATIONS (CONTINUED)
Tennessee Valley Authority
$50,000,000 5.52% 07/14/97 $ 49,900,333
13,170,000 5.42 07/17/97 13,138,275
20,000,000 5.50 07/23/97 19,932,778
25,000,000 5.38 07/28/97 24,899,125
51,360,000 5.45 08/04/97 51,095,639
15,000,000 5.43 09/15/97 14,828,050
- ---------------------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS $1,042,228,217
- ---------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $1,042,228,217(c)
- ---------------------------------------------------------------------------------------------
</TABLE>
(a)Portions of these securities are being segregated for when-issued
securities.
(b)When-issued securities.
(c)The amount stated also represents aggregate cost for federal income tax
purposes.
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or, for floating rate securities, the
current reset rate, which is based upon current interest rate indices.
The percentages shown for each investment category reflect the value of
investments in that category as a percentage of total net assets.
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ALABAMA--3.3%
Columbia IDB PCRB VRDN for Alabama Power Company Series 1995 B
(A-1/VMIG1)
$ 1,500,000 4.05% 07/01/97 $ 1,500,000
Homewood RB for Samford University (Bank of Nova Scotia LOC)
(VMIG1/A-1+)
17,300,000 4.05 07/01/97 17,300,000
Jefferson County MF Hsg. RB for Hickory Knolls Project Series 1994
(Amsouth Bank LOC)(P-1)
3,910,000 4.25 07/07/97 3,910,000
Mobile IDA PCRB for Alabama Power Series 1994(A-1/VMIG1)
5,700,000 4.05 07/01/97 5,700,000
- --------------------------------------------------------------------------------------------------
$ 28,410,000
- --------------------------------------------------------------------------------------------------
ALASKA--0.5%
Valdez Marine Terminal RB for Exxon Corporation Series 1993 A
(A-1+/VMIG1)
$ 4,300,000 4.00% 07/01/97 $ 4,300,000
- --------------------------------------------------------------------------------------------------
ARIZONA--2.5%
Maricopa County PCRB for Arizona Pollution Control Corp. Series
1994 A (Morgan Guaranty Trust Company)(A-1/P-1)
$19,200,000 4.00% 07/01/97 $ 19,200,000
Maricopa County PCRB for Southern California Edison Co.
Series 1995 G(A-1/P-1)
1,300,000 3.85 08/20/97 1,300,000
Phoenix IDA MF Hsg. VRDN for Del Mar Terrace Apartments (Bank of America
LOC)(VMIG1)
1,300,000 4.10 07/07/97 1,300,000
- --------------------------------------------------------------------------------------------------
$ 21,800,000
- --------------------------------------------------------------------------------------------------
ARKANSAS--0.5%
Crossett PCRB for Georgia Pacific Corp. Series 1991 VRDN (Suntrust Bank
LOC)(A-1+/P-1)
$ 4,500,000 4.20% 07/07/97 $ 4,500,000
- --------------------------------------------------------------------------------------------------
CALIFORNIA--1.1%
California School Cash Reserves Program Authority Series 1996 B (MBIA)(SP-
1/VMIG1)
$ 4,500,000 4.50% 12/19/97 $ 4,518,310
Los Angeles County, VRDN MF Hsg. for Valencia Village Series 1984 C
(Industrial Bank of Japan Ltd. LOC)(A-1)
4,700,000 4.30 07/07/97 4,700,000
- --------------------------------------------------------------------------------------------------
$ 9,218,310
- --------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COLORADO--0.6%
Colorado Health Facilities Authority Series 92 C (A-1+/VMIG1)
$ 5,400,000 4.15% 07/07/97 $ 5,400,000
- --------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA--1.5%
District of Columbia VRDN ACES for Georgetown University Series 1988 C(A-
1+/VMIG1)
$ 6,100,000 4.15% 07/07/97 $ 6,100,000
HFA MF Hsg. for Mclean Gardens South Apartments VRDN (Sumitomo Bank
LOC)(VMIG1)
7,000,000 4.35 07/07/97 7,000,000
- --------------------------------------------------------------------------------------------------
$ 13,100,000
- --------------------------------------------------------------------------------------------------
FLORIDA--4.7%
Dade County Water & Sewer System RB Series 1994 (FGIC)
(A-1/VMIG1)
$ 3,700,000 4.15% 07/07/97 $ 3,700,000
Florida Local Government Pooled CP Notes Series A (First Union National
Bank of Florida LOC)(A-1/P-1)
17,225,000 3.85 07/31/97 17,225,000
5,500,000 3.85 09/30/97 5,500,000
Putnam County Development Authority VRDN PCRB for Seminole Electric Series
1984 H(A-1+/P-1)
3,650,000 4.20 07/07/97 3,650,000
9,395,000 4.20 07/07/97 9,395,000
St Lucie County PCRB for Florida Power & Light Co. Series 1995
(A-1+/VMIG1)
1,000,000 4.00 07/01/97 1,000,000
- --------------------------------------------------------------------------------------------------
$ 40,470,000
- --------------------------------------------------------------------------------------------------
GEORGIA--6.9%
Bartow County PCRB for Georgia Power Company Co. 1996 (VMIG1)
$ 1,300,000 4.00% 07/01/97 $ 1,300,000
Burke County 1995 PCRB for Georgia Power Co. Fifth Series 1995 (VMIG1)
3,500,000 5.50 07/01/97 3,500,000
Burke County PCRB for Georgia Power Co.(A-1/VMIG1)
800,000 4.05 07/01/97 800,000
Burke County PCRB for Georgia Power Co. Eighth Series 1994
(A-1/VMIG1)
200,000 5.50 07/01/97 200,000
Burke County PCRB for Georgia Power Co. Ninth Series 1994
(A-1/VMIG1)
12,100,000 4.05 07/01/97 12,100,000
</TABLE>
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND (continued)
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
GEORGIA (CONTINUED)
Effingham County PCRB for Savannah Electric and Power Company Series
1997(A-1/VMIG1)
$ 2,600,000 5.50% 07/01/97 $ 2,600,000
Floyd County PCRB for Georgia Power Co. Series 1996(A-1/VMIG1)
3,000,000 5.50 07/01/97 3,000,000
Georgia Municipal Gas Authority RB for Gas Portfolio II Project Series A(A-
1+)
19,500,000 4.15 07/07/97 19,500,000
Municipal Electric Authority of Georgia Subordinated General Resolution
Series 1985 A (Credit Suisse First Boston/Morgan Guaranty/Bayerische
Landesbank Girozentrale LOC)(A-1/VMIG1)
10,200,000 3.80 09/12/97 10,200,000
Municipal Electric Authority of Georgia Subordinated General Resolution
Series 1985 B (Credit Suisse First Boston/Morgan Guaranty/Bayerische
Landesbank Girozentrale LOC)(A-1+/VMIG1)
6,000,000 3.75 07/25/97 6,000,000
- --------------------------------------------------------------------------------------------------
$ 59,200,000
- --------------------------------------------------------------------------------------------------
HAWAII--0.5%
Hawaii Housing Finance and Development Authority VRDN
(FHLB)(A-1+)
$ 4,000,000 4.10% 07/07/97 $ 4,000,000
- --------------------------------------------------------------------------------------------------
ILLINOIS--6.7%
Chicago GO Tender Notes Series 1997(A-1+/MIG1)
$10,000,000 3.65% 02/05/98 $ 10,000,000
Illinois Health Facilities Authority VRDN for Central Dupage Hospital
(Rabobank Nederland LOC)(VMIG1)
3,100,000 4.10 07/01/97 3,100,000
Illinois Health Facilities Authority VRDN for Healthcorp Affiliates
Projects Series 1985 A (Northern Trust Company LOC)(VMIG1)
2,400,000 4.20 07/07/97 2,400,000
Illinois Health Facilities Authority VRDN for Resurrection Healthcare
(VMIG1)
2,100,000 4.25 07/01/97 2,100,000
Illinois Health Facilities Authority VRDN Series 1985 C Revolving Fund
Pooled Finance Program (First National Bank of Chicago LOC) (A-1+/VMIG1)
4,000,000 4.15 07/07/97 4,000,000
Illinois Health Facilities Authority VRDN Series 1985 D Revolving Fund
Pooled Finance Program (First National Bank of Chicago LOC) (A-1+/VMIG1)
21,000,000 4.15 07/07/97 21,000,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ILLINOIS (CONTINUED)
O'Hare International Airport RB(P-1)
$ 5,100,000 4.15% 07/01/97 $ 5,100,000
Sauget PCRB VRDN Series 1992(P-1)
1,000,000 4.25 07/07/97 1,000,000
Sauget PCRB VRDN Series 1993(P-1)
1,900,000 4.25 07/07/97 1,900,000
Societe Generale Municipal Securities Trust Receipts for Chicago Midway
Airport RB Series 1996 A (MBIA)(A-1+)
7,540,000 4.35 07/07/97 7,540,000
- --------------------------------------------------------------------------------------------------
$ 58,140,000
- --------------------------------------------------------------------------------------------------
INDIANA--2.5%
Fort Wayne Hospital Authority VRDN for Parkview Memorial Hospital Series
1985 B (Bank of America LOC)(VMIG1)
$ 1,600,000 4.15% 07/07/97 $ 1,600,000
Fort Wayne Parkview Memorial Hospital VRDN Series 1985 B, C & D (Bank of
America LOC)(VMIG1)
10,000,000 4.15 07/07/97 10,000,000
Jasper County PCRB for Nipsco Series 1994 A(A-1/VMIG1)
2,800,000 4.05 07/01/97 2,800,000
Warrick County PCRB for Aluminum Company of America Series 1992(A-1)
7,475,000 4.20 07/07/97 7,475,000
- --------------------------------------------------------------------------------------------------
$ 21,875,000
- --------------------------------------------------------------------------------------------------
IOWA--3.2%
Chillicothe PCRB for Midwest Power Systems Series 1993 A (A-1/VMIG1)
$ 3,300,000 4.20% 07/07/97 $ 3,300,000
Louisa County PCRB for Iowa-Illinois Gas & Electric Co./Midamerican Energy
Co. Series 1986 A(A-1)
10,000,000 4.20 07/07/97 10,000,000
Salix PCRB VRDN for Midwest Power Systems Inc.(A-1/VMIG1)
14,000,000 4.20 07/07/97 14,000,000
- --------------------------------------------------------------------------------------------------
$ 27,300,000
- --------------------------------------------------------------------------------------------------
KENTUCKY--0.3%
Calvert PCRB for Air Products and Chemicals, Inc. Project
Series 1993 A(A-1)
$ 3,000,000 4.20% 07/07/97 $ 3,000,000
</TABLE>
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
LOUISIANA--2.1%
Calcasieu Parish VRDN RB for Olin Corp. Series 1993 B
(Wachovia Bank of North Carolina)(A-1+)
$ 1,200,000 4.00% 07/01/97 $ 1,200,000
Louisiana Public Facilities Authority Health Care System
Series 1997 D(A-1+/VMIG1)
9,500,000 3.70 07/30/97 9,500,000
Plaquemines Port Marine Terminal RB for Teco Energy Inc.
Series 1985 B(A-1/P-1)
4,450,000 3.85 08/20/97 4,450,000
St. James Parish PCRB for Occidental Petroleum Corp.
Series 1996 (Wachovia Bank LOC)(P-1)
3,000,000 4.05 07/07/97 3,000,000
- --------------------------------------------------------------------------------------------------
$ 18,150,000
- --------------------------------------------------------------------------------------------------
MARYLAND--1.2%
Anne Arundel County RB for Baltimore Gas & Electric Series 1985
(A-1/VMIG1)
$ 1,000,000 3.75% 08/13/97 $ 1,000,000
5,380,000 3.85 09/12/97 5,380,000
Baltimore County PCRB Baltimore Gas & Electric Series 1985
(A-1/VMIG1)
4,000,000 3.75 07/24/97 4,000,000
- --------------------------------------------------------------------------------------------------
$ 10,380,000
- --------------------------------------------------------------------------------------------------
MASSACHUSETTS--5.0%
Massachusetts Health & Education Authority RB For Harvard University Series
I(VMIG1)
$42,700,000 4.00% 07/07/97 $ 42,700,000
- --------------------------------------------------------------------------------------------------
MICHIGAN--2.7%
Michigan GO Notes(SP-1+/MIG1)
$18,000,000 4.50% 09/30/97 $ 18,044,101
Michigan Job Development Authority for Mazda Motor Manufacturing VRDN
(Sumitomo Bank LOC)(VMIG1)
1,400,000 4.38 07/07/97 1,400,000
Michigan State Strategic Fund Ltd. PCRB for Dow Chemical
Series 1987(P-1)
2,000,000 3.75 08/08/97 2,000,000
Monroe County Economic Development Corp. Ltd. RB Series 1992 CC (Barclays
Bank)(P-1)
1,900,000 4.25 07/07/97 1,900,000
- --------------------------------------------------------------------------------------------------
$ 23,344,101
- --------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
MINNESOTA--0.7%
Minnesota Higher Education Facility Authority, VRDN RB for Carleton College
Series 3-12(VMIG1)
$ 2,070,000 4.05% 07/07/97 $ 2,070,000
Port Authority of St. Paul VRDN for Weyerhaeuser Project
Series 1993(A-1)
4,000,000 4.20 07/07/97 4,000,000
- --------------------------------------------------------------------------------------------------
$ 6,070,000
- --------------------------------------------------------------------------------------------------
MISSISSIPPI--0.3%
Grenada County Refunding RB VRDN for Georgia Pacific Corp. Series 1994
(Sumitomo Bank LOC)(A-1/P-1)
$ 1,000,000 4.35% 07/07/97 $ 1,000,000
Mississippi Higher Education Facilities Authority VRDN RB for Baptist
Medical Center Series 1990 B (Rabobank Nederland)(VMIG1)
1,300,000 4.25 07/07/97 1,300,000
- --------------------------------------------------------------------------------------------------
$ 2,300,000
- --------------------------------------------------------------------------------------------------
MISSOURI--0.7%
Missouri Health & Education Facility Authority VRDN
(MBIA)(A-1+/AAA)
$ 4,500,000 4.15% 07/07/97 $ 4,500,000
Monsanto Corporation State Environmental Improvement and Energy Resources
Authority(P-1)
1,500,000 4.25 07/07/97 1,500,000
- --------------------------------------------------------------------------------------------------
$ 6,000,000
- --------------------------------------------------------------------------------------------------
NEVADA--2.4%
Clark County VRDN for Nevada Airport System (MBIA)(A-1/VMIG1)
$16,500,000 4.15% 07/07/97 $ 16,500,000
Eagle Tax Exempt Trust Series 97C2801 Class A COPS for Nevada GO Bonds
Series 1994(A-1+)
4,000,000 4.25 07/07/97 4,000,000
- --------------------------------------------------------------------------------------------------
$ 20,500,000
- --------------------------------------------------------------------------------------------------
NEW HAMPSHIRE--0.4%
New Hampshire Business Finance Authority PCRB for New England Power Series
1990 B(A-1/VMIG1)
$ 3,100,000 3.70% 07/31/97 $ 3,100,000
- --------------------------------------------------------------------------------------------------
NEW MEXICO--2.1%
Albuquerque RB for Sisters of Charity Series 1992
(A-1+/VMIG1)
$ 5,000,000 4.15% 07/07/97 $ 5,000,000
</TABLE>
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND (continued)
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NEW MEXICO (CONTINUED)
Farmington PCRB for Public Service Co. of New Mexico San Juan Project
Series 1997 A (Bank of America LOC)(A-1+/VMIG1)
$ 3,200,000 4.20% 07/07/97 $ 3,200,000
Farmington PCRB for Public Service Co. of New Mexico San Juan Project
Series 1997 B (Societe Generale LOC)(A-1+/VMIG1)
10,000,000 4.15 07/07/97 10,000,000
- -------------------------------------------------------------------------------------------------
$18,200,000
- -------------------------------------------------------------------------------------------------
NEW YORK--6.0%
Great Neck, NY North Water Authority Water System RB Series 1993 A VRDN
(FGIC)(A-1+/VMIG1)
$ 900,000 4.05% 07/07/97 $ 900,000
Metropolitan Transportation Authority Commuter Facility VRDN Series 1991
(National Westminster/Morgan Guaranty/Industrial Bank of Japan/Sumitomo
Bank/J.P. Morgan/Bank of Tokyo LOC)(AA-/VMIG1)
2,000,000 4.15 07/07/97 2,000,000
New York City Municipal Water Finance Authority CP Notes Series 5
(Bayerische Landesank/Westdeutsche Landesbank/Landesbank Hessen-
Thueringen LOC)(A-1+/P-1)
12,500,000 3.75 07/31/97 12,500,000
New York City Puttable Tax-exempt Receipts GO Bonds Fiscal 1995 Series D
(MBIA)(VMIG1)
10,000,000 4.10 07/07/97 10,000,000
New York State Energy Research & Development Authority PCRB for Brooklyn
Union Gas Series 1997 A-1 (MBIA)(A-1+/VMIG1)
3,500,000 4.05 07/07/97 3,500,000
New York State Energy Research & Development Authority PCRB for Rochester
Gas Series 1984 (Credit Suisse LOC)(P-1)
2,900,000 3.55 07/31/97 2,900,000
New York State Floating Rate Trust Receipts Series 1997(A-1/VMIG1)
2,500,000 4.35 07/07/97 2,500,000
New York State GO BANS Series S(A-1/P-1)
12,700,000 3.80 08/11/97 12,700,000
New York State Triborough Bridge & Tunnel Authority VRDN
(FGIC)(A-1+/VMIG1)
4,000,000 4.15 07/07/97 4,000,000
Trust for Cultural Resource of the City of New York 1990 Series B
(VMIG1/A-1+)
800,000 4.00 07/01/97 800,000
- -------------------------------------------------------------------------------------------------
$51,800,000
- -------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NORTH CAROLINA--6.1%
Person County PCRB for Carolina Power & Light Series 1992
A(A-1/P-1)
$16,400,000 4.30% 07/07/97 $ 16,400,000
Rockingham County IDA PCRB for Philip Morris Company(A-1/P-1)
7,700,000 4.40 07/07/97 7,700,000
Wake County PCRB for Carolina Power & Light 1990 A (Fuji Bank LOC)(A-2/P-1)
18,870,000 3.80 07/09/97 18,870,000
Wake County PCRB for Carolina Power & Light 1990 B (Fuji Bank LOC)(A-2/P-1)
10,000,000 3.85 07/15/97 10,000,000
- --------------------------------------------------------------------------------------------------
$ 52,970,000
- --------------------------------------------------------------------------------------------------
OHIO--2.8%
Columbus Electric System Series 1994 RB (Union Bank of Switzerland
LOC)(VMIG1)
$12,000,000 3.70% 07/31/97 $ 12,000,000
Franklin County Hospital RB for Holy Cross Health System Series 1995(A-
1+/VMIG1)
11,000,000 4.15 07/07/97 11,000,000
Ohio State Air Quality Development Authority RB for Cincinnati Gas &
Electric Series 1995 A (ABN/AMRO Bank LOC)(A-1+/VMIG1)
400,000 4.00 07/01/97 400,000
Ohio State PCRB for Sohio Water-British Petroleum Series 1995
(A-1/P-1)
1,110,000 4.05 07/01/97 1,110,000
- --------------------------------------------------------------------------------------------------
$ 24,510,000
- --------------------------------------------------------------------------------------------------
OREGON--1.1%
Portland VRDN for Columbia Grain Inc. Project (Fuji Bank/Bank of Tokyo
LOC)(VMIG1)
$ 9,450,000 4.38% 07/07/97 $ 9,450,000
- --------------------------------------------------------------------------------------------------
PENNSYLVANIA--0.5%
Philadelphia Hospital & Higher Education Facility Authority Series 1992
B(A-1+/VMIG1)
$ 4,100,000 4.05% 07/01/97 $ 4,100,000
- --------------------------------------------------------------------------------------------------
PUERTO RICO--5.4%
Commonwealth of Puerto Rico RANS Series 1997 A(SP-1+/MIG1)
$12,500,000 4.00% 07/30/97 $ 12,505,559
Puerto Rico Government Development Bank VRDN(A-1+)
24,335,000 3.80 08/13/97 24,335,000
</TABLE>
The accompanying notes are an integral part of these financial statements.
14
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
PUERTO RICO (CONTINUED)
Puerto Rico Government Development Bank TECP(A-1+)
$10,000,000 3.90% 09/12/97 $ 10,000,000
- --------------------------------------------------------------------------------------------------
$ 46,840,559
- --------------------------------------------------------------------------------------------------
SOUTH CAROLINA--0.7%
York County Floating/Fixed Rate PCRB Pooled Series 1984-North Carolina
Electric Membership Corp. VRDN (CFC)(A-1+/MIG1)
$ 5,775,000 4.20% 07/07/97 $ 5,775,000
- --------------------------------------------------------------------------------------------------
TENNESSEE--0.4%
Blount County PCRB for Aluminum Company of America Series 1992(A-1)
$ 2,450,000 4.20% 07/07/97 $ 2,450,000
Bradley County VRDN RB for Olin Corp. Series 1993 C (Wachovia Bank of North
Carolina LOC)(A-1+)
600,000 4.00 07/01/97 600,000
- --------------------------------------------------------------------------------------------------
$ 3,050,000
- --------------------------------------------------------------------------------------------------
TEXAS--12.1%
Coastal Bend Health Facilities Development Corp. (VMIG1)
$ 1,000,000 4.30% 07/07/97 $ 1,000,000
Gulf Coast Waste Disposal Authority PCRB for Monsanto Series 1996 (P-1)
5,300,000 4.25 07/07/97 5,300,000
Harris County Health Facilities Development Corp. Series 1997 A
(A-1+/VMIG1)
2,500,000 3.70 07/29/97 2,500,000
Harris County Hospital RB for Childrens Hospital Series 1989 B-2 (VMIG1)
5,000,000 4.15 07/07/97 5,000,000
Harris County Industrial Development Corp (A-1+)
800,000 4.05 07/01/97 800,000
Harris County Toll Road VRDN Series 1994 D(A-1+/VMIG1)
9,400,000 4.05 07/07/97 9,400,000
Houston GO CP Notes Series A(A-1+/P-1)
5,000,000 3.80 09/16/97 5,000,000
Lower Colorado River Authority CP Notes Series B(A-1+/P-1)
6,000,000 3.85 07/30/97 6,000,000
San Antonio Electric & Gas Systems CP Notes Series A(A-1+/P-1)
6,200,000 3.80 08/20/97 6,200,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
TEXAS (CONTINUED)
Societe Generale Municipal Securities Trust Receipts for San Antonio Texas
Electric and Gas System RB New Series 1997
SG 104/SG 105(A-1+)
$17,000,000 3.85% 08/07/97 $ 17,000,000
State of Texas TRANS Series 1996(SP-1+/MIG1)
43,420,000 4.75 08/29/97 43,481,234
West Side Calhoun County Development Corp. PCRB Series 1985
(A-1+/P-1)
2,800,000 4.15 07/01/97 2,800,000
- --------------------------------------------------------------------------------------------------
$104,481,234
- --------------------------------------------------------------------------------------------------
VIRGINIA--9.6%
Chesterfield County PCRB for Philip Morris Series 1992(A-1/P-1)
$14,700,000 4.35% 07/07/97 $ 14,700,000
Louisa PCRB for Virginia Electric & Power Series 1984(A-1/VMIG1)
4,000,000 3.85 07/15/97 4,000,000
2,000,000 3.85 07/17/97 2,000,000
4,000,000 3.80 07/23/97 4,000,000
4,000,000 3.90 08/14/97 4,000,000
1,500,000 3.90 08/20/97 1,500,000
3,900,000 3.90 08/22/97 3,900,000
Richmond VRDN Public Utility Revenue Notes Series A(A1+/VMIG1)
10,000,000 4.25 07/07/97 10,000,000
Roanoke VRDN for Carilion Health Systems Hospital Series A(A-1)
26,500,000 4.15 07/07/97 26,500,000
York County PCRB for Virginia Electric & Power Series 1985(A-1/A3)
2,900,000 3.85 07/17/97 2,900,000
9,000,000 3.75 08/13/97 9,000,000
- --------------------------------------------------------------------------------------------------
$ 82,500,000
- --------------------------------------------------------------------------------------------------
WASHINGTON--0.9%
Washington Healthcare Facility Authority VRDN for Fred Hutchinson Cancer
Research Center Series 1991 B(VMIG1)
$ 1,010,000 4.10% 07/01/97 $ 1,010,000
Washington Public Power Supply Project Electric RB Series 1993-2A (Bank of
America LOC)(A-1/VMIG1)
6,880,000 4.10 07/07/97 6,880,000
- --------------------------------------------------------------------------------------------------
$ 7,890,000
- --------------------------------------------------------------------------------------------------
WISCONSIN--0.9%
Milwaukee IDRB Multi-Modal for Pharmacia & Upjohn, Inc. Series 1994(P-1)
$ 8,000,000 4.65% 07/07/97 $ 8,000,000
- --------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
15
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND (continued)
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
WYOMING--0.6%
Lincoln County PCRB for Pacificorp Project Series 1991 (Union Bank of
Switzerland LOC)(A-1+/VMIG1)
$ 3,000,000 3.75% 09/11/97 $ 3,000,000
400,000 3.80 09/11/97 400,000
Pacificorp PCRB VRDN for Sweetwater County Series 1990 A (Credit Suisse
LOC)(VMIG1)
1,500,000 4.05 07/07/97 1,500,000
- ------------------------------------------------------------------------------------------------
$ 4,900,000
- ------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS $857,724,204(a)
- ------------------------------------------------------------------------------------------------
</TABLE>
(a)The amount stated also represents aggregate cost for federal income tax
purposes.
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or, for floating rate securities, the
current reset rate, which is based upon current interest rates indices.
Maturity dates represent either the stated date on the security, the next
interest reset date for floating rate securities, or the prerefunded date for
those types of securities.
Security ratings are unaudited.
The percentages shown for each investment category reflect the value of
investments in that category as a percentage of total net assets.
The accompanying notes are an integral part of these financial statements.
16
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------------------------------------------------
INVESTMENT ABBREVIATIONS:
ACES --Adjustable Convertible Extendible Securities
BANS --Bond Anticipation Notes
CFC --Unconditionally Guaranteed by CFC, Cooperative Finance Corp.
COPS --Certificates of Participation
CP --Commercial Paper
FGIC --Insured by Financial Guaranty Insurance Co.
FHLB --Federal Home Loan Bank
GO --General Obligation
HFA --Housing Finance Agency
IDA --Industrial Development Authority
IDB --Industrial Development Bond
IDRB --Industrial Development Revenue Bond
LOC --Letter of Credit
MBIA --Insured by Municipal Bond Investors Assurance
MF Hsg. --Multi-Family Housing
PCRB --Pollution Control Revenue Bond
RANS --Revenue Anticipation Notes
RB --Revenue Bond
TECP --Tax Exempt Commercial Paper
TRANS --Tax Revenue Anticipation Notes
VRDN --Variable Rate Demand Note
17
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
June 30, 1997
(Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
PRIME
OBLIGATIONS MONEY MARKET
FUND FUND
---------------------------
ASSETS:
<S> <C> <C>
Investments in securities, at value based on
amortized cost $4,474,859,659 $4,606,059,517
Cash 56,418 65,970
Interest receivable 20,217,354 19,572,861
Deferred organization expenses, net -- 16,990
Other assets 265,919 141,603
- -------------------------------------------------------------------------------
TOTAL ASSETS 4,495,399,350 4,625,856,941
- -------------------------------------------------------------------------------
LIABILITIES:
Payable for investment securities
purchased -- --
Dividends payable 24,125,326 22,503,359
Accrued expenses and other liabilities 1,004,433 1,095,510
- -------------------------------------------------------------------------------
TOTAL LIABILITIES 25,129,759 23,598,869
- -------------------------------------------------------------------------------
NET ASSETS:
Paid in capital 4,470,268,862 4,602,242,978
Accumulated undistributed net investment income -- --
Accumulated undistributed net realized gain
(loss) on investments 729 15,094
- -------------------------------------------------------------------------------
NET ASSETS $4,470,269,591 $4,602,258,072
- -------------------------------------------------------------------------------
Net asset value, offering and redemption price
per share
(net assets/shares outstanding) $1.00 $1.00
- -------------------------------------------------------------------------------
SHARES OUTSTANDING:
FST shares 3,813,081,114 3,991,996,825
FST Preferred shares 240,046,253 43,756,223
FST Administration shares 295,976,966 276,148,987
FST Service shares 121,164,529 290,340,943
- -------------------------------------------------------------------------------
Total shares of beneficial interest outstanding,
$0.001 par value
(unlimited number of shares authorized) 4,470,268,862 4,602,242,978
- -------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
18
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
TREASURY TREASURY TAX-FREE
OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MONEY MARKET
FUND FUND FUND FUND FUND
- --------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$3,021,771,573 $272,328,879 $2,170,063,437 $1,042,228,217 $857,724,204
35,130 84,333 66,012 24,734 500,205
6,319,006 3,205,591 6,340,836 1,536,865 5,824,393
-- -- -- -- 31,935
140,163 26,802 7,144 75,617 3,273
- --------------------------------------------------------------------------
3,028,265,872 275,645,605 2,176,477,429 1,043,865,433 864,084,010
- --------------------------------------------------------------------------
-- -- 99,936,750 64,943,073 --
13,561,282 1,020,530 10,164,164 4,121,432 2,564,575
980,923 146,082 781,543 519,065 174,967
- --------------------------------------------------------------------------
14,542,205 1,166,612 110,882,457 69,583,570 2,739,542
- --------------------------------------------------------------------------
3,013,687,919 274,466,741 2,065,599,431 974,281,863 861,358,000
-- -- -- 2,859 --
35,748 12,252 (4,459) (2,859) (13,532)
- --------------------------------------------------------------------------
$3,013,723,667 $274,478,993 $2,065,594,972 $ 974,281,863 $861,344,468
- --------------------------------------------------------------------------
$1.00 $1.00 $1.00 $1.00 $1.00
- --------------------------------------------------------------------------
2,140,037,970 237,434,466 1,222,438,256 714,024,245 731,787,339
2,825,740 1,500 48,896,830 1,501 5,469,429
638,279,282 1,131,506 190,743,421 137,933,257 96,498,886
232,544,927 35,899,269 603,520,924 122,322,860 27,602,346
- --------------------------------------------------------------------------
3,013,687,919 274,466,741 2,065,599,431 974,281,863 861,358,000
- --------------------------------------------------------------------------
</TABLE>
19
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
For the Six Months Ended June 30, 1997
(Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
PRIME
OBLIGATIONS MONEY MARKET
FUND FUND
-------------------------
<S> <C> <C>
INVESTMENT INCOME:
Interest income $150,778,630 $123,020,722
- -----------------------------------------------------------------------------
EXPENSES:
Management fees 5,549,296 4,491,570
Custodian fees 313,951 197,162
Registration fees 209,169 168,020
Amortization of deferred organization expenses -- 4,483
Trustees' fees 32,010 20,297
Other 228,337 109,781
- -----------------------------------------------------------------------------
TOTAL EXPENSES 6,332,763 4,991,313
Less--Expenses reimbursable and fees
waived by Goldman Sachs (1,460,211) (1,047,496)
- -----------------------------------------------------------------------------
Net expenses 4,872,552 3,943,817
Preferred share fees 79,582 14,218
Administration share fees 321,986 315,070
Service share fees 320,337 845,268
- -----------------------------------------------------------------------------
NET EXPENSES AND SHARE FEES 5,594,457 5,118,373
- -----------------------------------------------------------------------------
NET INVESTMENT INCOME 145,184,173 117,902,349
- -----------------------------------------------------------------------------
NET REALIZED GAIN (LOSS) ON INVESTMENT TRANSAC-
TIONS 13,632 24,659
- -----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERA-
TIONS $145,197,805 $117,927,008
- -----------------------------------------------------------------------------
</TABLE>
(a) Commencement date of operations for the Treasury Instruments and the
Federal Fund was March 3, 1997 and February 28, 1997, respectively.
The accompanying notes are an integral part of these financial statements.
20
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
TREASURY TREASURY TAX-FREE
OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MONEY MARKET
FUND FUND(A) FUND FUND(A) FUND
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$78,310,881 $3,909,008 $52,696,383 $12,455,299 $13,377,712
- -------------------------------------------------------------------------------------
2,940,015 151,180 1,960,199 460,458 752,437
203,827 28,274 101,930 97,389 15,852
154,721 49,274 -- 171,916 5,157
-- -- -- -- 7,727
15,506 6,575 5,991 11,457 2,554
119,636 30,811 32,242 60,914 20,928
- -------------------------------------------------------------------------------------
3,433,705 266,114 2,100,362 802,134 804,655
(852,226) (134,465) (379,211) (406,158) (143,979)
- -------------------------------------------------------------------------------------
2,581,479 131,649 1,721,151 395,976 660,676
10,143 -- 9,068 -- 5,090
730,961 773 314,524 47,126 101,011
536,935 48,176 1,166,051 77,066 54,216
- -------------------------------------------------------------------------------------
3,859,518 180,598 3,210,794 520,168 820,993
- -------------------------------------------------------------------------------------
74,451,363 3,728,410 49,485,589 11,935,131 12,556,719
- -------------------------------------------------------------------------------------
174,705 51,826 127,727 (2,859) (673)
- -------------------------------------------------------------------------------------
$74,626,068 $3,780,236 $49,613,316 $11,932,272 $12,556,046
- -------------------------------------------------------------------------------------
</TABLE>
21
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Six Months Ended June 30, 1997
(Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<S> <C> <C>
PRIME
OBLIGATIONS MONEY MARKET
FUND FUND
-----------------------------
FROM OPERATIONS:
Net investment income $ 145,184,173 $ 117,902,349
Net realized gain (loss) on
investment transactions 13,632 24,659
- -----------------------------------------------------------------------------
Net increase in net assets
resulting from operations 145,197,805 117,927,008
- -----------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
FST shares (131,189,598) (102,274,186)
FST Preferred shares (4,222,876) (761,752)
FST Administration shares (6,635,324) (6,533,435)
FST Service shares (3,136,375) (8,332,976)
Net realized gain on investment
transactions
FST shares (12,652) (9,091)
FST Preferred shares (335) (81)
FST Administration shares (675) (591)
FST Service shares (331) (756)
- -----------------------------------------------------------------------------
Total distributions to shareholders (145,198,166) (117,912,868)
- -----------------------------------------------------------------------------
FROM SHARE TRANSACTIONS (AT $1.00 PER
SHARE):
Proceeds from sales of shares 28,504,262,585 32,669,134,604
Reinvestment of dividends and
distributions 64,069,452 55,880,000
Cost of shares repurchased (28,458,038,291) (31,080,788,447)
- -----------------------------------------------------------------------------
Net increase (decrease) in net assets
resulting from share transactions 110,293,746 1,644,226,157
- -----------------------------------------------------------------------------
Total increase (decrease) 110,293,385 1,644,240,297
NET ASSETS:
Beginning of period 4,359,976,206 2,958,017,775
- -----------------------------------------------------------------------------
End of period $ 4,470,269,591 $ 4,602,258,072
- -----------------------------------------------------------------------------
Accumulated undistributed net investment
income -- --
</TABLE>
- --------------------------------------------------------------------------------
(a) Commencement date of operations for the Treasury Instruments and the
Federal Fund was March 3, 1997 and February 28, 1997, respectively.
The accompanying notes are an integral part of these financial statements.
22
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
TREASURY TREASURY TAX-FREE
OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MONEY MARKET
FUND FUND(A) FUND FUND(A) FUND
- --------------------------------------------------------------------------------
$ 74,451,363 $ 3,728,410 $ 49,485,589 $ 11,935,131 $ 12,556,719
174,705 51,826 127,727 (2,859) (673)
- --------------------------------------------------------------------------------
74,626,068 3,780,236 49,613,316 11,932,272 12,556,046
- --------------------------------------------------------------------------------
(54,078,253) (3,268,016) (31,359,341) (10,204,220) (10,760,679)
(525,690) (7) (482,455) (7) (165,047)
(14,710,547) (15,122) (6,376,770) (973,290) (1,312,189)
(5,136,873) (445,265) (11,267,023) (754,755) (318,804)
(155,521) (34,205) (95,927) -- --
(1,317) -- (1,268) -- --
(45,320) (195) (20,586) -- --
(16,837) (5,174) (40,889) -- --
- --------------------------------------------------------------------------------
(74,670,358) (3,767,984) (49,644,259) (11,932,272) (12,556,719)
- --------------------------------------------------------------------------------
12,940,991,607 742,388,723 9,016,688,309 2,187,239,403 3,179,706,866
28,055,275 708,003 10,542,051 3,099,430 3,171,712
(13,050,421,858) (468,629,985) (8,189,147,334) (1,216,056,970) (2,862,618,495)
- --------------------------------------------------------------------------------
(81,374,976) 274,466,741 838,083,026 974,281,863 320,260,083
- --------------------------------------------------------------------------------
(81,419,266) 274,478,993 838,052,083 974,281,863 320,259,410
3,095,142,933 -- 1,227,542,889 -- 541,085,058
- --------------------------------------------------------------------------------
$ 3,013,723,667 $ 274,478,993 $ 2,065,594,972 $ 974,281,863 $ 861,344,468
- --------------------------------------------------------------------------------
-- -- -- $ 2,859 --
</TABLE>
- --------------------------------------------------------------------------------
23
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
For the Year Ended December 31, 1996
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
PRIME TREASURY TAX-FREE
OBLIGATIONS MONEY MARKET OBLIGATIONS GOVERNMENT MONEY MARKET
FUND FUND FUND FUND FUND
---------------------------------------------------
FROM OPERATIONS:
Net investment income $ 263,491,381 $ 162,277,598 $ 124,545,016 $ 65,841,904 $ 18,529,517
Net realized gain (loss)
on
investment transactions 105,304 189,110 587,091 136,538 (5,995)
- --------------------------------------------------------------------------------
Net increase in net as-
sets resulting
from operations 263,596,685 162,466,708 125,132,107 65,978,442 18,523,522
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHARE-
HOLDERS FROM:
Net investment income
FST shares (245,389,523) (149,928,272) (93,857,124) (48,867,861) (15,981,710)
FST Preferred shares (2,239,677) (162,278) (797,088) (19,753) (431,737)
FST Administration
shares (10,697,750) (9,558,151) (21,870,105) (5,023,737) (1,593,538)
FST Service shares (5,164,431) (2,628,897) (8,020,699) (11,930,553) (522,532)
Net realized gain on
investment transactions
FST shares (128,847) (173,838) (385,734) (81,682) --
FST Preferred shares (1,177) (188) (3,276) (33) --
FST Administration
shares (5,617) (11,082) (89,882) (8,397) --
FST Service shares (2,712) (3,048) (32,963) (19,942) --
- --------------------------------------------------------------------------------
Total distributions to
shareholders (263,629,734) (162,465,754) (125,056,871) (65,951,958) (18,529,517)
- --------------------------------------------------------------------------------
FROM SHARE TRANSACTIONS
(AT $1.00 PER SHARE):
Proceeds from sales of
shares 48,481,127,400 44,257,102,764 20,383,057,696 14,111,648,633 4,669,259,507
Reinvestment of
dividends and
distributions 126,514,648 91,077,089 45,060,831 21,912,928 6,495,873
Cost of shares repur-
chased (47,756,596,271) (43,600,991,427) (19,343,068,853) (13,746,823,336) (4,623,830,243)
- --------------------------------------------------------------------------------
Net increase in net
assets resulting
from share
transactions 851,045,777 747,188,426 1,085,049,674 386,738,225 51,925,137
- --------------------------------------------------------------------------------
Total increase 851,012,728 747,189,380 1,085,124,910 386,764,709 51,919,142
NET ASSETS:
Beginning of year 3,508,963,478 2,210,828,395 2,010,018,023 840,778,180 489,165,916
- --------------------------------------------------------------------------------
End of year $ 4,359,976,206 $ 2,958,017,775 $ 3,095,142,933 $ 1,227,542,889 $ 541,085,058
</TABLE>
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
24
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
1.ORGANIZATION
Effective May 1, 1997, the Goldman Sachs Money Market Trust was reorganized
from a Massachusetts business trust to a Delaware business trust named the
Goldman Sachs Trust (the "Trust"). The Trust includes the Financial Square
Funds, collectively "the Funds" or individually a "Fund". The Trust is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company. Financial Square consists of nine diversified
funds: Prime Obligations, Money Market, Treasury Obligations, Treasury
Instruments, Government, Federal, Tax-Free Money Market, Municipal Money Market
(inactive as of June 30, 1997) and Premium Money Market (inactive as of June
30, 1997). The Financial Square Funds offer four classes of shares: FST shares,
FST Administration shares, FST Service shares and FST Preferred shares. The
investment objective of the Funds is to maximize current income to the extent
consistent with the preservation of capital and maintenance of liquidity.
2.SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds. The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that may affect the reported amounts.
A. Investment Valuation--
Each Fund uses the amortized-cost method for valuing portfolio securities which
approximates market value. Under this method, all investments purchased at a
discount or premium are valued by amortizing the difference between the
original purchase price and maturity value of the issue over the period to
maturity.
B. Interest Income--
Interest income is determined on the basis of interest accrued, premium
amortized and discount earned.
C. Federal Taxes--
It is each Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
each year substantially all investment company taxable and tax-exempt income to
shareholders. Accordingly, no federal tax provisions are required.
The characterization of distributions to shareholders for financial reporting
purposes is determined in accordance with federal income tax rules. Therefore,
the source of the Funds' distributions may be shown in the accompanying
financial statements as either from or in excess of net investment income or
net realized gain on investment transactions, or from paid-in capital,
depending on the type of book/tax differences that may exist.
At December 31, 1996, the Funds' tax year end, the Tax-Free Money Market Fund
had approximately $13,000 of capital loss carryforward for U.S. Federal tax
purposes. This capital loss carryforward expires in the year 2004.
D. Deferred Organization Expenses--
Organization-related costs are being amortized on a straight-line basis over a
period of five years.
E. Expenses--
Expenses incurred by the Funds that do not specifically relate to an individual
fund are allocated to the Funds based on each Fund's relative average net
assets for the period.
Shareholders of FST Preferred, FST Administration and FST Service shares bear
all expenses and fees paid to service organizations for their services with
respect to
25
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 1997
(Unaudited)
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
such shares as well as other expenses (subject to expense limitations) that are
directly attributable to such shares.
3.AGREEMENTS
As of May 1, 1997, the Fund's Investment Advisory and Administration Agreements
were combined into an Investment Management Agreement (the "Agreement")
encompassing the same services and fee structure. Goldman Sachs Asset
Management ("GSAM"), a separate operating division of Goldman, Sachs & Co.
("Goldman Sachs"), manages the portfolios of the Funds, subject to general
supervision by the Trust's Board of Trustees and administers each Fund's
business affairs, including providing facilities. As compensation for the
services rendered under the Investment Management Agreement and the assumption
of the expenses related thereto, GSAM is entitled to a fee, computed daily and
payable monthly, at an annual rate equal to .205% of each Fund's average daily
net assets. These amounts are included in "Accrued expenses and other
liabilities" in the accompanying Statements of Assets and Liabilities.
For the six months ended June 30, 1997, GSAM has voluntarily agreed to waive a
portion of its management fee and limit certain of each of the Fund's expenses
(excluding management fees, service organization fees, taxes, interest,
brokerage commissions and extraordinary expenses) to the extent that such
expenses exceed .01% per annum of the Fund's average daily net assets. These
amounts are included in "Other assets" in the accompanying Statement of Assets
and Liabilities.
Goldman Sachs serves as Transfer Agent and Distributor of shares of the Funds
pursuant to Transfer Agent and Distribution Agreements and receives no fee.
The following chart outlines the fee waivers and expense reimbursements for
the six months ended June 30, 1997 and amounts owed to and due from GSAM at
June 30, 1997 (in thousands):
<TABLE>
<CAPTION>
Amounts
Management Expense Amounts due
Fees Reimburse- due to from
Fund Waived ments Total GSAM GSAM
<S> <C> <C> <C> <C> <C>
Prime
Obligations
Fund $947 $513 $1,460 $699 $231
- -------------------------------------------------------------
Money Market
Fund 767 280 1,047 710 119
- -------------------------------------------------------------
Treasury
Obligations
Fund 502 350 852 409 125
- -------------------------------------------------------------
Treasury
Instruments
Fund 27 107 134 34 27
- -------------------------------------------------------------
Government Fund 335 44 379 328 --
- -------------------------------------------------------------
Federal Fund 87 319 406 131 76
- -------------------------------------------------------------
Tax-Free Money
Market Fund 128 16 144 121 --
</TABLE>
4.ADMINISTRATION, SERVICE AND PREFERRED PLANS
The Funds have adopted Administration, Service and Preferred Plans to
compensate service organizations for providing varying levels of account
administration and shareholder liaison services to their customers who are
beneficial owners of such shares. The Preferred, Administration and Service
Plans provide for compensation to the service organizations in an amount up to
..10%, .25% and .50% (on an annualized basis), respectively, of the average
daily net asset value of the respective shares.
5.LINE OF CREDIT FACILITY
The Funds participate in a $250,000,000 uncommitted, unsecured revolving line
of credit facility to be used solely for temporary or emergency purposes. Under
the most restrictive arrangement, each Fund must own securities having a market
value in excess of 300% of the
26
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
total bank borrowings. The interest rate on the borrowings is based on the
Federal Funds rate. During the six months ended June 30, 1997, the Funds did
not have any borrowings under this facility.
6.REPURCHASE AGREEMENTS
During the term of a repurchase agreement, the value of the underlying
securities, including accrued interest, is required to equal or exceed the
value of the repurchase agreement. The underlying securities for all repurchase
agreements are held in safekeeping at a custodian.
7.JOINT REPURCHASE AGREEMENT ACCOUNTS
The Funds, together with other registered investment companies having
management agreements with GSAM or its affiliates, transfer uninvested cash
balances into joint accounts, the daily aggregate balances of which are
invested in one or more repurchase agreements. The underlying securities for
the repurchase agreements are U.S. Treasury obligations.
At June 30, 1997, the Prime Obligations, Money Market, Treasury Obligations
and Government Funds had undivided interests in the repurchase agreements in
the following joint account, which equaled $315,700,000, $79,600,000,
$650,500,000 and $361,000,000 in principal amount, respectively. At June 30,
1997, the repurchase agreements in this joint account, along with the
corresponding underlying securities (including the type of security, market
value, interest rate and maturity date), were as follows:
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS
CIBC Wood Gundy Securities, dated 06/30/97, repurchase price $32,905,438
(U.S. Treasury Note: $33,560,121, 6.375%, 03/31/01)
$32,900,000 5.95% 07/01/97 $ 32,900,000
Deutshe Bank, dated 06/30/97, repurchase price $975,165,208 (U.S. Treasury
Notes: $972,860,973, 5.00%-8.50%, 11/30/97-05/15/07; U.S. Treasury
Stripped Securities: $21,639,768, 08/15/99-02/15/07)
975,000,000 6.10 07/01/97 975,000,000
Donaldson Lufkin & Jenrette, Inc., dated 06/30/97, repurchase price
$520,085,944 (U.S. Treasury Stripped Securities: $499,717,019, 08/15/97-
05/15/07; U.S. Treasury Notes: $30,683,075, 6.125%-6.25%, 09/30/00-
02/15/07))
520,000,000 5.95 07/01/97 520,000,000
Swiss Bank Corp., dated 06/30/97, repurchase price $503,483,200 (U.S.
Treasury Notes: $480,019,868, 3.375%-9.125%, 07/31/97-01/15/07; U.S.
Treasury Bills: $34,569,420, 07/24/97-05/28/98; U.S. Treasury Bond:
$615,008, 10.75%, 08/15/05)
503,400,000 5.95 07/01/97 503,400,000
Swiss Bank Corp., dated 06/30/97, repurchase price $100,014,722 (U.S.
Treasury Notes: $95,543,523, 3.375%-9.125%, 07/31/97-01/15/07; U.S.
Treasury Bills: $6,880,724, 07/24/97-05/28/98; U.S. Treasury Bond:
$122,412, 10.75%, 08/15/05)
100,000,000 5.30 07/01/97 100,000,000
- -----------------------------------------------------------------------------------------------
Total Joint Repurchase Agreement Account $2,131,300,000
- -----------------------------------------------------------------------------------------------
</TABLE>
8.OTHER MATTERS
Pursuant to an SEC exemptive order, certain of the Funds may enter into certain
principal transactions, including repurchase agreements, with Goldman, Sachs &
Co. subject to certain limitations as follows: 25% of eligible security
transactions, as defined, and 10% of repurchase agreement transactions.
27
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
June 30, 1997
(Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
9. SUMMARY OF SHARE TRANSACTIONS
Share activity for the six months ended June 30, 1997 is as follows:
<TABLE>
<CAPTION>
PRIME TREASURY TREASURY TAX-FREE
OBLIGATIONS MONEY MARKET OBLIGATIONS INSTRUMENTS GOVERNMENT FEDERAL MONEY MARKET
FUND FUND FUND FUND FUND FUND FUND
FST SHARES:
<S> <C> <C> <C> <C> <C> <C> <C>
Shares sold 25,861,076,069 31,009,843,613 9,588,228,683 640,129,197 6,726,062,143 1,573,533,976 2,882,561,349
Reinvestment of
dividends and
distributions 59,912,303 50,520,073 18,635,046 703,538 8,376,837 2,584,933 2,457,993
Shares
repurchased (26,009,699,328) (29,608,727,868) (9,757,793,211) (403,398,269) (6,370,744,629) (862,094,664) (2,594,082,121)
- -------------------------------------------------------------------------------------------------------------------------------
(88,710,956) 1,451,635,818 (150,929,482) 237,434,466 363,694,351 714,024,245 290,937,221
- -------------------------------------------------------------------------------------------------------------------------------
FST PREFERRED
SHARES:
Shares sold 702,667,176 165,812,836 46,161,803 1,500 91,625,116 1,500 49,262,422
Reinvestment of
dividends and
distributions 176,800 467,908 611,548 0 41,460 1 76,867
Shares
repurchased (589,926,457) (140,035,071) (90,584,204) 0 (42,882,176) 0 (72,600,418)
- -------------------------------------------------------------------------------------------------------------------------------
112,917,519 26,245,673 (43,810,853) 1,500 48,784,400 1,501 (23,261,129)
- -------------------------------------------------------------------------------------------------------------------------------
FST
ADMINISTRATION
SHARES:
Shares sold 902,415,355 939,526,100 1,939,119,896 2,856,365 953,075,246 231,075,379 126,938,261
Reinvestment of
dividends and
distributions 2,104,432 4,135,993 4,689,067 4,465 1,184,462 158,912 379,940
Shares
repurchased (824,443,074) (833,277,833) (1,842,433,066) (1,729,324) (908,619,456) (93,301,034) (82,481,110)
- -------------------------------------------------------------------------------------------------------------------------------
80,076,713 110,384,260 101,375,897 1,131,506 45,640,252 137,933,257 44,837,091
- -------------------------------------------------------------------------------------------------------------------------------
FST SERVICE
SHARES:
Shares sold 1,038,103,985 553,952,055 1,367,481,225 99,401,661 1,245,925,804 382,628,548 120,944,834
Reinvestment of
dividends and
distributions 1,875,917 756,026 4,119,614 0 939,292 355,584 256,912
Shares
repurchased (1,033,969,432) (498,747,675) (1,359,611,377) (63,502,392) (866,901,073) (260,661,272) (113,454,846)
- -------------------------------------------------------------------------------------------------------------------------------
6,010,470 55,960,406 11,989,462 35,899,269 379,964,023 122,322,860 7,746,900
- -------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) in
shares 110,293,746 1,644,226,157 (81,374,976) 274,466,741 838,083,026 974,281,863 320,260,083
- ------------------=============================================================================================================
</TABLE>
28
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
Share activity for the year ended December 31, 1996 is as follows:
<TABLE>
<CAPTION>
TAX-FREE
PRIME OBLIGATIONS MONEY MARKET TREASURY GOVERNMENT MONEY MARKET
FUND FUND OBLIGATIONS FUND FUND FUND
FST SHARES:
<S> <C> <C> <C> <C> <C>
Shares sold 44,941,258,260 41,611,799,874 15,303,462,361 11,674,849,553 4,186,677,890
Reinvestment of
dividends and
distributions 120,569,689 84,724,371 33,617,264 19,640,980 4,879,667
Shares repurchased (44,455,790,432) (41,225,360,339) (14,633,812,470) (11,579,631,835) (4,199,081,918)
- ----------------------------------------------------------------------------------------------------------------
606,037,517 471,163,906 703,267,155 114,858,698 (7,524,361)
- ----------------------------------------------------------------------------------------------------------------
FST PREFERRED SHARES:
Shares sold 377,996,154 77,361,171 94,309,002 8,202,329 65,543,581
Reinvestment of
dividends and
distributions 6,257 76,227 473,231 7,480 322,508
Shares repurchased (250,873,677) (59,926,848) (48,145,640) (8,097,379) (37,135,531)
- ----------------------------------------------------------------------------------------------------------------
127,128,734 17,510,550 46,636,593 112,430 28,730,558
- ----------------------------------------------------------------------------------------------------------------
FST ADMINISTRATION
SHARES:
Shares sold 1,718,885,581 2,097,089,351 2,868,056,191 1,074,614,378 177,906,627
Reinvestment of
dividends and
distributions 2,721,453 5,879,304 4,640,302 1,055,828 844,377
Shares repurchased (1,653,602,695) (2,074,616,324) (2,618,986,546) (1,012,951,862) (148,027,716)
- ----------------------------------------------------------------------------------------------------------------
68,004,339 28,352,331 253,709,947 62,718,344 30,723,288
- ----------------------------------------------------------------------------------------------------------------
FST SERVICE SHARES:
Shares sold 1,442,987,405 470,852,368 2,117,230,142 1,353,982,373 239,131,409
Reinvestment of
dividends and
distributions 3,217,249 397,187 6,330,034 1,208,640 449,321
Shares repurchased (1,396,329,467) (241,087,916) (2,042,124,197) (1,146,142,260) (239,585,078)
- ----------------------------------------------------------------------------------------------------------------
49,875,187 230,161,639 81,435,979 209,048,753 (4,348)
- ----------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in shares 851,045,777 747,188,426 1,085,049,674 386,738,225 51,925,137
- -----------------------------===================================================================================
</TABLE>
29
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding Throughout Each Period
Prime Obligations Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0267 $ -- $0.0267 $(0.0267) $1.00 5.53%(b) 0.18%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0262 -- 0.0262 (0.0262) 1.00 5.42(b) 0.28(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0255 -- 0.0255 (0.0255) 1.00 5.27(b) 0.43(b) 5.15(b)
1997-FST Service
shares.......... 1.00 0.0243 -- 0.0243 (0.0243) 1.00 5.00(b) 0.68(b) 4.90(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 1.00 0.0529 -- 0.0529 (0.0529) 1.00 5.41 0.18 5.29
1996-FST Pre-
ferred
Shares (c)...... 1.00 0.0346 -- 0.0346 (0.0346) 1.00 5.28(b) 0.28(b) 5.19(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0506 -- 0.0506 (0.0506) 1.00 5.14 0.43 5.06
1996-FST Service
shares.......... 1.00 0.0478 -- 0.0478 (0.0478) 1.00 4.88 0.68 4.78
1995-FST
shares.......... 1.00 0.0586 -- 0.0586 (0.0586) 1.00 6.02 0.18 5.86
1995-FST Admin-
istration
shares.......... 1.00 0.0559 -- 0.0559 (0.0559) 1.00 5.75 0.43 5.59
1995-FST Service
shares.......... 1.00 0.0533 -- 0.0533 (0.0533) 1.00 5.49 0.68 5.33
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 1.00 0.0401 -- 0.0401 (0.0401) 1.00 4.38(b) 0.18(b) 4.38(b)
1994-FST Pre-
ferred
Shares (d)...... 1.00 0.0383 -- 0.0383 (0.0383) 1.00 4.12(b) 0.43(b) 4.18(b)
1994-FST Service
shares (d)...... 1.00 0.0364 -- 0.0364 (0.0364) 1.00 3.86(b) 0.68(b) 3.98(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST
shares.......... 1.00 0.0311 0.0002 0.0313 (0.0313) 1.00 3.18 0.17 3.11
1994-FST Admin-
istration
shares.......... 1.00 0.0286 0.0002 0.0288 (0.0288) 1.00 2.92 0.42 2.86
1994-FST Service
shares.......... 1.00 0.0261 0.0002 0.0263 (0.0263) 1.00 2.66 0.67 2.61
1993-FST
shares.......... 1.00 0.0360 0.0007 0.0367 (0.0367) 1.00 3.75 0.18 3.60
1993-FST Admin-
istration
shares (e)...... 1.00 0.0068 0.0001 0.0069 (0.0069) 1.00 3.02(b) 0.44(b) 2.96(b)
1993-FST Service
shares.......... 1.00 0.0301 0.0007 0.0308 (0.0308) 1.00 3.23 0.68 3.01
1992-FST
shares.......... 1.00 0.0572 0.0002 0.0574 (0.0574) 1.00 5.99 0.18 5.72
1992-FST Service
shares (e)...... 1.00 0.0027 -- 0.0027 (0.0027) 1.00 4.10(b) 0.66(b) 4.10(b)
FOR THE PERIOD MARCH 8, 1990 (F) THROUGH JANUARY 31,
- ----------------------------------------------------
1991-FST
shares.......... 1.00 0.0727 -- .0727 (0.0727) 1.00 8.27(b) 0.18(b) 8.04(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $3,813,081 0.23%(b) 5.34%(b)
1997-FST Pre-
ferred Shares... 240,047 0.33(b) 5.26(b)
1997-FST Admin-
istration
shares.......... 295,977 0.48(b) 5.10(b)
1997-FST Service
shares.......... 121,165 0.73(b) 4.85(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 3,901,797 0.23 5.24
1996-FST Pre-
ferred
Shares (c)...... 127,126 0.33(b) 5.14(b)
1996-FST Admin-
istration
shares.......... 215,898 0.48 5.01
1996-FST Service
shares.......... 115,114 0.73 4.73
1995-FST
shares.......... 3,295,791 0.22 5.82
1995-FST Admin-
istration
shares.......... 147,894 0.47 5.55
1995-FST Service
shares.......... 65,278 0.72 5.29
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 2,774,849 0.24(b) 4.32(b)
1994-FST Pre-
ferred
Shares (d)...... 66,113 0.49(b) 4.12(b)
1994-FST Service
shares (d)...... 41,372 0.74(b) 3.92(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST
shares.......... 1,831,413 0.25 3.03
1994-FST Admin-
istration
shares.......... 35,250 0.50 2.78
1994-FST Service
shares.......... 14,001 0.75 2.53
1993-FST
shares.......... 813,126 0.25 3.53
1993-FST Admin-
istration
shares (e)...... 1,124 0.52(b) 2.88(b)
1993-FST Service
shares.......... 336 0.75 2.94
1992-FST
shares.......... 917,073 0.27 5.63
1992-FST Service
shares (e)...... 118 0.74(b) 4.02(b)
FOR THE PERIOD MARCH 8, 1990 (F) THROUGH JANUARY 31,
- ----------------------------------------------------
1991-FST
shares.......... 578,495 0.28(b) 7.94(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
(e)FST Administration share and FST Service share activity commenced during
November of 1992 and January 1992, respectively.
(f)Commencement of operations.
The accompanying notes are an integral part of these financial statements.
30
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Money Market Fund
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0269 $ -- $0.0269 $(0.0269) $1.00 5.57%(b) 0.18%(b) 5.44%(b)
1997-FST Pre-
ferred Shares... 1.00 0.0264 -- 0.0264 (0.0264) 1.00 5.46(b) 0.28(b) 5.36(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0257 -- 0.0257 (0.0257) 1.00 5.30(b) 0.43(b) 5.18(b)
1997-FST Service
shares.......... 1.00 0.0244 -- 0.0244 (0.0244) 1.00 5.04(b) 0.68(b) 4.93(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 1.00 0.0533 0.0001 0.0534 (0.0534) 1.00 5.45 0.18 5.33
1996-FST Pre-
ferred
shares (c)...... 1.00 0.0348 -- 0.0348 (0.0348) 1.00 5.31(b) 0.28(b) 5.23(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0504 0.0001 0.0505 (0.0505) 1.00 5.19 0.43 5.04
1996-FST Service
shares.......... 1.00 0.0484 -- 0.0484 (0.0484) 1.00 4.93 0.68 4.84
1995-FST
Shares.......... 1.00 0.0589 -- 0.0589 (0.0589) 1.00 6.07 0.15 5.89
1995-FST Admin-
istration
shares.......... 1.00 0.0561 -- 0.0561 (0.0561) 1.00 5.80 0.40 5.61
1995-FST Service
shares (d)...... 1.00 0.0231 -- 0.0231 (0.0231) 1.00 5.41(b) 0.65(b) 4.93(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 1.00 0.0305 -- 0.0305 (0.0305) 1.00 4.91(b) 0.11(b) 4.88(b)
1994-FST Admin-
istration
shares (d)...... 1.00 0.0298 -- 0.0298 (0.0298) 1.00 4.65(b) 0.36(b) 4.82(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $3,992,002 0.23%(b) 5.39%(b)
1997-FST Pre-
ferred Shares... 43,759 0.33(b) 5.31(b)
1997-FST Admin-
istration
shares.......... 276,152 0.48(b) 5.13(b)
1997-FST Service
shares.......... 290,345 0.73(b) 4.88(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 2,540,366 0.23 5.28
1996-FST Pre-
ferred
shares (c)...... 17,510 0.33(b) 5.18(b)
1996-FST Admin-
istration
shares.......... 165,766 0.48 4.99
1996-FST Service
shares.......... 234,376 0.73 4.79
1995-FST
Shares.......... 2,069,197 0.23 5.81
1995-FST Admin-
istration
shares.......... 137,412 0.48 5.53
1995-FST Service
shares (d)...... 4,219 0.73(b) 4.85(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 862,971 0.25(b) 4.74(b)
1994-FST Admin-
istration
shares (d)...... 66,560 0.50(b) 4.68(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST, FST Administration and FST Service share activity commenced May 18,
1994, May 20, 1994 and July 14, 1995, respectively.
The accompanying notes are an integral part of these financial statements.
31
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Obligations Fund
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN (LOSS) INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0262 $ 0.0001 $0.0263 $(0.0263) $1.00 5.43%(b) 0.18%(b) 5.28%(b)
1997-FST Pre-
ferred shares .. 1.00 0.0257 0.0001 0.0258 (0.0258) 1.00 5.32(b) 0.28(b) 5.18(b)
1997-FST Admin-
istration shares
................. 1.00 0.0249 0.0001 0.0250 (0.0250) 1.00 5.16(b) 0.43(b) 5.03(b)
1997-FST Service
shares ......... 1.00 0.0237 0.0001 0.0238 (0.0238) 1.00 4.90(b) 0.68(b) 4.78(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 1.00 0.0522 0.0003 0.0525 (0.0524) 1.00 5.35 0.18 5.22
1996-FST Pre-
ferred
shares (c)...... 1.00 0.0342 0.0001 0.0343 (0.0343) 1.00 5.24(b) 0.28(b) 5.11(b)
1996-FST Admin-
istration shares
................. 1.00 0.0497 0.0002 0.0499 (0.0498) 1.00 5.09 0.43 4.97
1996-FST Service
shares ......... 1.00 0.0472 0.0002 0.0474 (0.0474) 1.00 4.83 0.68 4.72
1995-FST shares
................. 1.00 0.0573 0.0005 0.0578 (0.0578) 1.00 5.96 0.18 5.73
1995-FST Admin-
istration shares
................. 1.00 0.0547 0.0005 0.0552 (0.0552) 1.00 5.69 0.43 5.47
1995-FST Service
shares ......... 1.00 0.0521 0.0005 0.0526 (0.0526) 1.00 5.43 0.68 5.21
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 1.00 0.0379 (0.0001) 0.0378 (0.0378) 1.00 4.23(b) 0.18(b) 4.13(b)
1994-FST Admin-
istration
shares (d)...... 1.00 0.0388 (0.0001) 0.0387 (0.0387) 1.00 3.97(b) 0.43(b) 4.24(b)
1994-FST Service
shares (d)...... 1.00 0.0349 (0.0001) 0.0348 (0.0348) 1.00 3.71(b) 0.68(b) 3.82(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST
shares.......... 1.00 0.0301 0.0007 0.0308 (0.0307) 1.00 3.11 0.17 3.01
1994-FST Admin-
istration shares
................. 1.00 0.0276 0.0006 0.0282 (0.0281) 1.00 2.85 0.42 2.76
1994-FST Service
shares ......... 1.00 0.0251 0.0008 0.0259 (0.0256) 1.00 2.60 0.67 2.51
1993-FST shares
................. 1.00 0.0342 0.0012 0.0354 (0.0355) 1.00 3.69 0.18 3.42
1993-FST Admin-
istration
shares (e)...... 1.00 0.0009 -- 0.0009 (0.0009) 1.00 2.83(b) 0.43(b) 2.83(b)
1993-FST Service
shares ......... 1.00 0.0296 0.0016 0.0312 (0.0309) 1.00 3.17 0.68 2.96
1992-FST shares
................. 1.00 0.0549 0.0015 0.0564 (0.0561) 1.00 5.84 0.18 5.49
1992-FST Service
shares (e)...... 1.00 0.0113 0.0006 0.0119 (0.0116) 1.00 4.47(b) 0.68(b) 3.77(b)
FOR THE PERIOD MARCH 5, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST
shares.......... 1.00 0.0600 0.0006 0.0606 (0.0605) 1.00 8.06(b) 0.21(b) 7.74(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $2,140,063 0.24%(b) 5.22%(b)
1997-FST Pre-
ferred shares .. 2,826 0.34(b) 5.12(b)
1997-FST Admin-
istration shares
................. 638,287 0.49(b) 4.97(b)
1997-FST Service
shares ......... 232,548 0.74(b) 4.72(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 2,291,051 0.24 5.16
1996-FST Pre-
ferred
shares (c)...... 46,637 0.34(b) 5.05(b)
1996-FST Admin-
istration shares
................. 536,895 0.49 4.91
1996-FST Service
shares ......... 220,560 0.74 4.66
1995-FST shares
................. 1,587,715 0.23 5.68
1995-FST Admin-
istration shares
................. 283,186 0.48 5.42
1995-FST Service
shares ......... 139,117 0.73 5.16
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 958,196 0.25(b) 4.06(b)
1994-FST Admin-
istration
shares (d)...... 82,124 0.50(b) 4.17(b)
1994-FST Service
shares (d)...... 81,162 0.75(b) 3.75(b)
FOR THE YEARS ENDED JANUARY 31,
- -------------------------------
1994-FST
shares.......... 812,420 0.24 2.94
1994-FST Admin-
istration shares
................. 24,485 0.49 2.69
1994-FST Service
shares ......... 35,656 0.74 2.44
1993-FST shares
................. 776,181 0.26 3.34
1993-FST Admin-
istration
shares (e)...... 1 0.51(b) 2.75(b)
1993-FST Service
shares ......... 5,155 0.76 2.88
1992-FST shares
................. 413,171 0.28 5.39
1992-FST Service
shares (e)...... 3,634 0.78 3.67(b)
FOR THE PERIOD MARCH 5, 1990(F) THROUGH JANUARY 31,
- ---------------------------------------------------
1991-FST
shares.......... 229,988 0.34(b) 7.61(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced May 1, 1996.
(d)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
(e)FST Administration and PST Service share activity commenced during January
of 1993 and October of 1991, respectively.
(f)Commencement of operations.
The accompanying notes are an integral part of these financial statements.
32
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Instruments Fund
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
---------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------------------------
1997-FST
shares(c)....... $1.00 $ 0.0168 $ 0.0002 $ 0.0170 $(0.0170) $1.00 5.29%(b) 0.18%(b) 5.12%(b)
1997-FST Pre-
ferred Shares
(c)............. 1.00 0.0043 0.0002 0.0045 (0.0045) 1.00 5.19(b) 0.28(b) 5.04(b)
1997-FST Admin-
istration shares
(c)............. 1.00 0.0122 0.0002 0.0124 (0.0124) 1.00 5.06(b) 0.43(b) 4.89(b)
1997-FST Service
shares (c)...... 1.00 0.0150 0.0002 0.0152 (0.0152) 1.00 4.73(b) 0.68(b) 4.63(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET
ASSETS AT RATIO OF NET
END RATIO OF INVESTMENT
OF PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30, (UNAUDITED)
- -----------------------------------------
1997-FST
shares(c)....... $237,444 0.36%(b) 4.94%(b)
1997-FST Pre-
ferred Shares
(c)............. 2 0.46(b) 4.86(b)
1997-FST Admin-
istration shares
(c)............. 1,132 0.61(b) 4.71(b)
1997-FST Service
shares (c)...... 35,901 0.86(b) 4.45(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the
investment at the net asset value at the end of the period.
(b) Annualized.
(c) FST Share, FST Preferred Share, FST Administration Share, and FST Service
Share activity commenced March 3, 1997, May 30, 1997, April 1, 1997, and
March 5, 1997, respectively.
The accompanying notes are an integral part of these financial statements.
33
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Government Fund
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $ 0.0264 $0.0001 $ 0.0265 $(0.0265) $1.00 5.47%(b) 0.18%(b) 5.33%(b)
1997-FST Pre-
ferred shares... 1.00 0.0259 0.0001 0.0260 (0.0260) 1.00 5.37(b) 0.28(b) 5.32(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0251 0.0001 0.0252 (0.0252) 1.00 5.21(b) 0.43(b) 5.07(b)
1997-FST Service
shares.......... 1.00 0.0239 0.0001 0.0240 (0.0240) 1.00 4.95(b) 0.68(b) 4.83(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 1.00 0.0525 0.0001 0.0526 (0.0526) 1.00 5.38 0.18 5.25
1996-FST Pre-
ferred
shares (c)...... 1.00 0.0344 0.0001 0.0345 (0.0345) 1.00 5.26(b) 0.28(b) 5.14(b)
1996-FST Admin-
istration
shares.......... 1.00 0.0501 0.0001 0.0502 (0.0502) 1.00 5.12 0.43 5.01
1996-FST Service
shares.......... 1.00 0.0474 0.0001 0.0475 (0.0475) 1.00 4.86 0.68 4.74
1995-FST
shares.......... 1.00 0.0581 0.0001 0.0582 (0.0582) 1.00 6.00 0.18 5.81
1995-FST Admin-
istration
shares.......... 1.00 0.0554 0.0001 0.0555 (0.0555) 1.00 5.74 0.43 5.54
1995-FST Service
shares (d)...... 1.00 0.0320 -- 0.0320 (0.0320) 1.00 5.40(b) 0.68(b) 5.08(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (e)...... 1.00 0.0424 -- 0.0424 (0.0424) 1.00 4.36(b) 0.15(b) 4.64(b)
1994-FST Admin-
istration
shares (e)...... 1.00 0.0426 -- 0.0426 (0.0426) 1.00 4.10(b) 0.40(b) 4.67(b)
FOR THE PERIOD ENDED JANUARY 31,
- --------------------------------
1994-FST
shares (d)...... 1.00 0.0256 0.0001 0.0257 (0.0257) 1.00 3.14(b) 0.08(b) 3.10(b)
1994-FST Admin-
istration
shares (d)...... 1.00 0.0120 0.0001 0.0121 (0.0121) 1.00 2.87(b) 0.35(b) 2.85(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
--------------------------
NET RATIO OF NET
ASSETS AT RATIO OF INVESTMENT
END EXPENSES TO INCOME TO
OF PERIOD AVERAGE NET AVERAGE NET
(IN 000'S) ASSETS ASSETS
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1,222,437 0.22%(b) 5.29%(b)
1997-FST Pre-
ferred shares... 48,896 0.32(b) 5.28(b)
1997-FST Admin-
istration
shares.......... 190,742 0.47(b) 5.03(b)
1997-FST Service
shares.......... 603,520 0.72(b) 4.79(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 858,769 0.24 5.19
1996-FST Pre-
ferred
shares (c)...... 112 0.34(b) 5.08(b)
1996-FST Admin-
istration
shares.......... 145,108 0.49 4.95
1996-FST Service
shares.......... 223,554 0.74 4.68
1995-FST
shares.......... 743,884 0.24 5.75
1995-FST Admin-
istration
shares.......... 82,386 0.49 5.48
1995-FST Service
shares (d)...... 14,508 0.74(b) 5.02(b)
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (e)...... 258,350 0.25(b) 4.54(b)
1994-FST Admin-
istration
shares (e)...... 54,253 0.50(b) 4.57(b)
FOR THE PERIOD ENDED JANUARY 31,
- --------------------------------
1994-FST
shares (d)...... 44,697 0.59(b) 2.59(b)
1994-FST Admin-
istration
shares (d)...... 14,126 0.76(b) 2.44(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and complete redemption of the investment at
the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST share, FST Administration share and FST Service share activity
commenced April 6, 1993, September 1, 1993 and May 16, 1995, respectively.
(e)The information presented reflects eleven months of operations due to a
change in fiscal year end. This change was caused by the reorganization of the
funds as a series of Goldman Sachs Money Market Trust.
The accompanying notes are an integral part of these financial statements.
34
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Federal Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-----------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN ON INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $1.00 $ 0.0178 -- $ 0.0178 $ (0.0178) $1.00 5.47%(b) 0.18%(b) 5.36%(b)
1997-FST Pre-
ferred
shares(c)....... 1.00 0.0047 -- 0.0047 (0.0047) 1.00 5.46(b) 0.28(b) 5.28(b)
1997-FST
Administration
shares(c)....... 1.00 0.0128 -- 0.0128 (0.0128) 1.00 5.25(b) 0.43(b) 5.17(b)
1997-FST Service
shares(c)....... 1.00 0.0131 -- 0.0131 (0.0131) 1.00 4.99(b) 0.68(b) 4.90(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
NET EXPENSE LIMITATIONS
ASSETS -------------------------
AT END RATIO OF NET
OF RATIO OF INVESTMENT
PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE PERIOD ENDED JUNE 30,
(UNAUDITED)
- -----------------------------
1997-FST
shares(c)....... $714,024 0.36%(b) 5.18%(b)
1997-FST Pre-
ferred
shares(c)....... 2 0.46(b) 5.10(b)
1997-FST
Administration
shares(c)....... 137,933 0.61(b) 4.99(b)
1997-FST Service
shares(c)....... 122,323 0.86(b) 4.72(b)
</TABLE>
- ----
(a) Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b) Annualized.
(c) FST share, FST Preferred share, FST Administration share, and FST Service
share activity commenced February 28, 1997, May 30, 1997, April 1, 1997 and
March 25, 1997, respectively.
The accompanying notes are an integral part of these financial statements.
35
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
Selected Data for a Share Outstanding Throughout Each Period
Tax-Free Money Market Fund
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
------------------------------------
RATIO OF NET
NET ASSET NET REALIZED TOTAL NET ASSET RATIO OF NET INVESTMENT
VALUE AT NET GAIN INCOME FROM DISTRIBUTIONS VALUE AT EXPENSES TO INCOME TO
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT TO END TOTAL AVERAGE NET AVERAGE NET
OF PERIOD INCOME TRANSACTIONS OPERATIONS SHAREHOLDERS OF PERIOD RETURN(A) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $1.00 $0.0170 -- $0.0170 $(0.0170) $1.00 3.49%(b) 0.18%(b) 3.46%(b)
1997-FST Pre-
ferred shares... 1.00 0.0165 -- 0.0165 (0.0165) 1.00 3.39(b) 0.28(b) 3.24(b)
1997-FST Admin-
istration
shares.......... 1.00 0.0158 -- 0.0158 (0.0158) 1.00 3.23(b) 0.43(b) 3.25(b)
1997-FST Service
shares.......... 1.00 0.0146 -- 0.0146 (0.0146) 1.00 2.97(b) 0.68(b) 2.94(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 1.00 0.0335 -- 0.0335 (0.0335) 1.00 3.39 0.18 3.35
1996-FST Pre-
ferred shares... 1.00 0.0218 -- 0.0218 (0.0218) 1.00 3.30(b) 0.28(b) 3.26(b)
1996-FST Admin-
istration
shares (c)...... 1.00 0.0310 -- 0.0310 (0.0310) 1.00 3.13 0.43 3.10
1996-FST Service
shares.......... 1.00 0.0285 -- 0.0285 (0.0285) 1.00 2.88 0.68 2.85
1995-FST
shares.......... 1.00 0.0381 -- 0.0381 (0.0381) 1.00 3.89 0.14 3.81
1995-FST Admin-
istration
shares.......... 1.00 0.0354 -- 0.0354 (0.0354) 1.00 3.63 0.39 3.54
1995-FST Service
shares.......... 1.00 0.0332 -- 0.0332 (0.0332) 1.00 3.38 0.64 3.32
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 1.00 0.0156 -- 0.0156 (0.0156) 1.00 3.41(b) 0.07(b) 3.42(b)
1994-FST Admin-
istration
shares (d)...... 1.00 0.0136 -- 0.0136 (0.0136) 1.00 3.19(b) 0.32(b) 3.25(b)
1994-FST Service
shares (d)...... 1.00 0.0091 -- 0.0091 (0.0091) 1.00 3.11(b) 0.57(b) 3.32(b)
<CAPTION>
RATIOS ASSUMING NO
WAIVER OF FEES AND NO
EXPENSE LIMITATIONS
-------------------------
NET
ASSETS AT RATIO OF NET
END RATIO OF INVESTMENT
OF PERIOD EXPENSES TO INCOME TO
(IN AVERAGE NET AVERAGE NET
000'S) ASSETS ASSETS
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FOR THE SIX MONTHS ENDED JUNE 30, (UNAUDITED)
- ---------------------------------------------
1997-FST
shares.......... $731,783 0.22%(b) 3.42%(b)
1997-FST Pre-
ferred shares... 5,468 0.32(b) 3.20(b)
1997-FST Admin-
istration
shares.......... 96,496 0.47(b) 3.21(b)
1997-FST Service
shares.......... 27,597 0.72(b) 2.90(b)
FOR THE YEARS ENDED DECEMBER 31,
- --------------------------------
1996-FST
shares.......... 440,838 0.23 3.30
1996-FST Pre-
ferred shares... 28,731 0.33(b) 3.21(b)
1996-FST Admin-
istration
shares (c)...... 51,661 0.48 3.05
1996-FST Service
shares.......... 19,855 0.73 2.80
1995-FST
shares.......... 448,367 0.24 3.71
1995-FST Admin-
istration
shares.......... 20,939 0.49 3.44
1995-FST Service
shares.......... 19,860 0.74 3.22
FOR THE PERIOD ENDED DECEMBER 31,
- ---------------------------------
1994-FST
shares (d)...... 183,570 0.31(b) 3.18(b)
1994-FST Admin-
istration
shares (d)...... 2,042 0.56(b) 3.01(b)
1994-FST Service
shares (d)...... 2,267 0.81(b) 3.08(b)
</TABLE>
- ----
(a)Assumes investment at the net asset value at the beginning of the period,
reinvestment of all distributions and a complete redemption of the investment
at the net asset value at the end of the period.
(b)Annualized.
(c)FST Preferred share activity commenced on May 1, 1996.
(d)FST share, FST Administration share and FST Service share activity
commenced July 19, 1994, August 1, 1994 and September 23, 1994, respectively.
The accompanying notes are an integral part of these financial statements.
36
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
[This page intentionally left blank]
37
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------- ---------------------------------------
[This page intentionally left blank]
38
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------------------------------------------------
This Semiannual Report is authorized for distribution to prospective investors
only when preceded or accompanied by a Goldman Sachs Trust Financial Square
Funds Prospectus which contains facts concerning each Fund's objectives and
policies, management, expenses and other information.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
Goldman Sachs
1 New York Plaza
New York, NY 10004
TRUSTEES
Ashok N. Bakhru, Chairman
David B. Ford
Douglas C. Grip
John P. McNulty
Mary P. McPherson
Alan A. Shuch
Jackson W. Smart, Jr.
William H. Springer
Richard P. Strubel
OFFICERS
Douglas C. Grip, President
John W. Mosior, Vice President
Nancy L. Mucker, Vice President
Scott M. Gilman, Treasurer
John M. Perlowski, Assistant Treasurer
Michael J. Richman, Secretary
Howard B. Surloff, Assistant Secretary
GOLDMAN SACHS
Investment Adviser,
Distributor and Transfer Agent
FS/SAR 6/97
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
GOLDMAN SACHS
TRUST
FINANCIAL SQUARE
FUNDS
- --------------------------------------------------------------------------------
SEMIANNUAL REPORT
JUNE 30, 1997
PRIME OBLIGATIONS FUND
MONEY MARKET FUND
TREASURY OBLIGATIONS FUND
TREASURY INSTRUMENTS FUND
GOVERNMENT FUND
FEDERAL FUND
TAX-FREE MONEY MARKET FUND
[LOGO] GOLDMAN SACHS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
APPENDIX A
DESCRIPTION OF SECURITIES RATINGS*
MOODY'S INVESTORS SERVICE, INC.
Bond Ratings
- ------------
AAA: Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edged." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.
AA: Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than with Aaa securities.
A: Bonds which are rated A possess many favorable investment attributes and are
to be considered a upper-medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment some time in the future.
Moody's applies numerical modifiers 1, 2, and 3 in the Aa and A categories. The
modifier 1 indicates that the obligation ranks in the higher end of the
category; the modifier 2 indicates a mid-range ranking; and the modifier 3
indicates that the issue ranks in the lower end of the respective category.
- --------------------------------------------------------------------------------
* The ratings indicated herein are believed to be the most recent ratings
available at the date of this Statement of Additional Information for the
securities listed. Ratings are generally given to securities at the time of
issuance. While the rating agencies may from time to time revise such ratings,
they undertake no obligation to do so, and the ratings indicated do not
necessarily represent ratings which will be given to these securities on the
date of the Portfolios' taxable year end.
A-1
<PAGE>
Short-Term Ratings
- ------------------
P-1: Issuers have a superior ability for repayment of senior short-term
promissory obligations. Prime-1 or P-1 repayment ability will often be evidenced
by many of the following characteristics:
. Leading market positions in well established industries.
. High rates of return on funds employed.
. Conservative capitalization structure with moderate reliance on debt and
ample asset protection.
. Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.
. Well established access to a range of financial markets and assured
sources of alternate liquidity.
P-2: Issuers have a strong ability for repayment of senior short-term
promissory obligations. This will normally be evidenced by many of the
characteristics cited above but to a lesser degree. Earnings trends and
coverage ratios, while sound, may be more subject to variation. Capitalization
characteristics, while still appropriate, may be more affected by external
conditions. Ample alternate liquidity is maintained.
State and Municipal Obligations
- -------------------------------
Moody's ratings for state and municipal short-term obligations will be
designated Moody's Investment Grade or (MIG). Such ratings recognize the
differences between short-term credit risk and long-term risk. Factors
affecting the liquidity of the borrower and short-term cyclical elements are
critical in short-term ratings, while other factors of major importance in bond
risk, long-term secular trends for example, may be less important over the short
run. Symbols used will be as follows:
MIG 1/VMIG 1 -- This designation denotes best quality. There is present strong
protection by established cash flows, superior liquidity support or demonstrated
broadbased access to the market for refinancing.
MIG 2/VMIG 2 -- This designation denotes high quality. Margins of protection
are ample although not so large as in the preceding group.
A short-term rating may also be assigned on an issue having a demand feature-
variable rate demand obligation. Such ratings will be designated as VMIG to
reflect such characteristics as payment upon periodic demand rather than fixed
maturity dates and payment relying on external liquidity. Additionally,
investors
A-2
<PAGE>
should be alert to the fact that the source of payment may be limited to the
external liquidity with no or limited legal recourse to the issuer in the event
the demand is not met.
STANDARD & POOR'S RATINGS GROUP
Bond Ratings
- ------------
AAA: An obligation rated AAA has the highest rating assigned by Standard &
Poor's. The obligor's capacity to pay interest and repay principal on the
obligation is extremely strong.
AA: An obligation rated AA differs from the highest rated obligations only in
small degree. The obligor's capacity to pay interest and repay principal on the
obligation is very strong.
A: An obligation rated A is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in higher
rated categories. However, the obligor's capacity to pay interest and repay
principal on the obligation is still strong.
PLUS (+) OR MINUS (-): The AA and A ratings may be modified by the addition of
a plus or minus sign to show relative standing within the category.
Short-Term Ratings
- ------------------
A-1: A short-term obligation rated A-1 is rated in the highest category by
Standard & Poor's. The obligor's capacity to meet its financial commitment on
the obligation is strong. Within this category, certain obligations are
designated with a plus sign (+). This indicates that the obligor's capacity to
meet its financial commitment on these obligations is extremely strong.
A-2: A short-term obligation rated A-2 is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than
obligations in higher rating categories. However, the obligor's capacity to
meet its financial commitment on the obligation is satisfactory.
Municipal Notes
- ---------------
A Standard & Poor's note rating reflects the liquidity factors and market access
risks unique to notes. Notes maturing in 3 years or less will likely receive a
note rating. Notes maturing beyond 3 years will most likely receive a long-term
debt rating. The following criteria will be used in making that assessment.
. Amortization schedule (the larger the final maturity relative to other
maturities the more likely it will be treated as a note).
A-3
<PAGE>
. Source of payment (the more dependent the issue is on the market for
its refinancing, the more likely it will be treated as a note).
Note rating symbols are as follows:
SP-1 -- Strong capacity to pay principal and interest. Those issues determined
to possess very strong characteristics will be given a plus (+) designation.
SP-2 -- Satisfactory capacity to pay principal and interest with some
vulnerability to adverse financial and economic changes over the term of the
notes.
Standard & Poor's assigns "dual" ratings to all debt issues that have a put
option or demand feature as part of their structure.
The first rating addresses the likelihood of repayment of principal and interest
as due, and the second rating addresses only the demand feature. The long-term
debt rating symbols are used for bonds to denote the long-term maturity and the
Resources commercial paper rating symbols for the put option (for example,
"AAA/A-1+"). With short-term demand debt, S&P's note rating symbols are used
with the commercial paper rating symbols (for example, "SP-1+/A-1+").
DUFF & PHELPS, INC.
Bond Ratings
- ------------
AAA: The highest credit quality. The risk factors are negligible, being only
slightly more than for risk-free U.S. Treasury debt.
AA: High credit quality. Protection factors are strong. Risk is modest but
may vary slightly from time to time because of economic conditions.
A: Protection factors are average but adequate. However, risk factors are more
variable and greater in periods of economic stress.
Duff & Phelps applies modifiers, + and - in the AA and A categories for long-
term fixed securities. The modifier + indicates that the security ranks in the
higher end of the category; the modifier AA or A indicates a mid-range ranking;
and the modifier - indicates that the issue ranks in the lower end of the
category.
A-4
<PAGE>
Short-Term Ratings
- ------------------
D-1: Commercial paper and certificates of deposit rated Duff 1 are considered
to have a very high certainty of timely payment. Liquidity factors are
considered excellent and are supported by strong fundamental protection factors.
Risk factors are minor.
D-2: Commercial paper and certificates of deposit rated Duff 2 are considered
to have a good certainty of timely payment. Liquidity factors and company
fundamentals are considered sound. Although ongoing funding needs may enlarge
total financing requirements, access to capital markets is good and risk factors
are small.
Duff & Phelps applies a plus and minus rating scale, D-1+, D-1 and D-1- in the
Duff 1 top grade category for short-term debt. The rating D-1+ indicates that
the security has the highest certainty of timely payment, short-term liquidity
is clearly outstanding and safety is just below risk-free U.S. Treasury short-
term obligations; the rating D-1 indicates a very high certainty of timely
payment, liquidity factors are excellent and risk factors are minimal; and the
rating D-1- indicates a high certainty of timely payment, liquidity factors are
strong and risk factors are very small.
FITCH INVESTORS SERVICE CORP.
AAA: Bonds which are rated AAA are considered to be investment grade and of the
highest credit quality. The obligor has an exceptionally strong ability to pay
its obligations, which is unlikely to be affected by reasonably foreseeable
events.
AA: Bonds which are rated AA are considered to be investment grade and of very
high credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because bonds
rated in the AAA and AA categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these issuers is generally
rated "F-1+".
A: Bonds which are rated A are considered to be investment grade and of high
credit quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.
Fitch applies plus (+) and minus (-) modifiers in the AA and A categories to
indicate the relative position of a credit within the rating category. The
modifier AA+ indicates that the security ranks at the higher end of the AA
category than a security rated AA or AA- .
A-5
<PAGE>
Fitch's short-term ratings apply to debt obligations that are payable on demand
or have original maturities of up to three years, including commercial paper,
certificates of deposit, medium-term notes, and municipal and investment notes.
The short-term rating places greater emphasis than a long-term rating on the
existence of liquidity necessary to meet the issuer's obligations in a timely
manner.
F-1: Short-term debt obligations rated F-1 are considered to be of very strong
credit quality. Those issues determined to possess exceptionally strong credit
quality and having the strongest degree of assurance for timely payment will be
denoted with a plus ("+") sign designation.
F-2: Short-term debt obligations rated F-2 are considered to be of good credit
quality. Issues assigned this rating have a satisfactory degree of assurance
for timely payment, but the margin of safety is not as great as for issues
assigned F-1+ and F-1 ratings.
IBCA LIMITED AND IBCA INC.
A1: Short-term obligations rated A1 are supported by the highest capacity for
timely repayment. Where issues possess a particularly strong credit feature a
rating of A1+ is assigned.
A2: Short-term obligations rated A2 are supported by a satisfactory capacity
for timely repayment, although such capacity may be susceptible to adverse
changes in business, economic or financial conditions.
THOMSON BANKWATCH, INC.
AAA: The highest category; indicates an extremely high ability to repay
principal and interest on a timely basis.
AA:The second highest category; indicates a very strong ability to repay
principal and interest on a timely basis, with limited incremental risk compared
to issues rated in the highest category.
A: The third highest category; indicates the ability to repay principal and
interest is strong. Issuer rated A could be more vulnerable to adverse
developments (both internal an external) than obligations with higher ratings.
Ratings in the AA and A Long-Term Debt categories may include a plus (+) or
minus (-) designation which indicates where within the respective category the
issue is placed.
The TBW Short-Term Ratings apply only to specific debt instruments that have a
maturity of one year or less.
A-6
<PAGE>
The TBW Short-Term Ratings specifically assess the likelihood of an untimely
payment of principal and interest.
TBW-1: The highest category; indicates a very high likelihood that principal
and interest will be paid on a timely basis.
TBW-2: The second highest category; while the degree of safety regarding timely
repayment of principal and interest is strong, the relative degree of safety is
not as high as for issues rated TBW-1.
A-7
<PAGE>
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
---------------------------------
(a) Financial Statements
Included in the Prospectus:
Financial Highlights for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Treasury Instruments Fund, Financial Square
Government Fund, Financial Square Federal Fund and Financial Square Tax-
Free Money Market Fund (collectively, the "Financial Square Funds") for the
period ended June 30, 1997 (unaudited),
Financial Highlights for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Government Fund and Financial Square Tax-Free Money
Market Fund (collectively, the "Financial Square Funds") for the period
ended December 31, 1996 (audited)
Incorporated by Reference into the Statement of Additional Information:
Statements of Investments for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Treasury Instruments Fund, Financial Square
Government Fund, Financial Square Federal Fund and Financial Square Tax-
Free Money Market Fund as of June 30, 1997 (unaudited),
Statements of Investments for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Government Fund and Financial Square Tax-Free Money
Market Fund (collectively, the "Financial Square Funds") for the period
ended December 31, 1996 (audited)
Statements of Assets and Liabilities for the Financial Square Prime
Obligations Fund, Financial Square Money Market Fund, Financial Square
Treasury Obligations Fund, Financial Square Treasury Instruments Fund,
Financial Square Government Fund, Financial Square Federal Fund and
Financial Square Tax-Free Money Market Fund as of June 30, 1997
(unaudited),
<PAGE>
Statements of Assets and Liabilities for the Financial Square Prime
Obligations Fund, Financial Square Money Market Fund, Financial Square
Treasury Obligations Fund, Financial Square Government Fund and Financial
Square Tax-Free Money Market Fund (collectively, the "Financial Square
Funds") for the period ended December 31, 1996 (audited)
Statements of Operations for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Treasury Instruments Fund, Financial Square
Government Fund, Financial Square Federal Fund and Financial Square Tax-
Free Money Market Fund as of June 30, 1997 (unaudited),
Statements of Operations for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Government Fund and Financial Square Tax-Free Money
Market Fund (collectively, the "Financial Square Funds") for the period
ended December 31, 1996 (audited)
Statements of Changes in Net Assets for the Financial Square Prime
Obligations Fund, Financial Square Money Market Fund, Financial Square
Treasury Obligations Fund, Financial Square Treasury Instruments Fund,
Financial Square Government Fund, Financial Square Federal Fund and
Financial Square Tax-Free Money Market Fund as of June 30, 1997
(unaudited),
Statements of Changes in Net Assets for the Financial Square Prime
Obligations Fund, Financial Square Money Market Fund, Financial Square
Treasury Obligations Fund, Financial Square Government Fund and Financial
Square Tax-Free Money Market Fund (collectively, the "Financial Square
Funds") for the period ended December 31, 1996 (audited)
Financial Highlights for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Treasury Instruments Fund, Financial Square
Government Fund, Financial Square Federal Fund and Financial Square Tax-
Free Money Market Fund as of June 30, 1997 (unaudited),
Statements of Investments for the Financial Square Prime Obligations Fund,
Financial Square Money Market Fund, Financial Square Treasury Obligations
Fund, Financial Square Government Fund and Financial Square Tax-Free Money
Market Fund (collectively, the "Financial Square Funds") for the period
ended December 31, 1996 (audited)
Notes to Financial Statements.
2
<PAGE>
(b) Exhibits
The following exhibits are incorporated herein by reference to Registrant's
Registration Statement on form N-1A as initially filed (Reference A), to Pre-
Effective Amendment No. 1 to such Registration Statement (Reference B), or to
Post-Effective Amendment No. 1 to such Registration Statement (Reference C), or
to Post-Effective Amendment No. 2 to such Registration Statement (Reference D),
or to Post-Effective Amendment No. 4 to such Registration Statement (Reference
F), or to Post-Effective Amendment No. 12 to such Registration Statement
(Reference M), or to Post-Effective Amendment No. 16 to such Registration
Statement (Reference Q) or to Post-Effective Amendment No. 17 to such
Registration Statement (Reference R), or to Post-Effective Amendment No. 19 to
such Registration Statement (Reference T), or to Post-Effective Amendment No. 20
to such Registration Statement (Reference U), or to Post-Effective Amendment No.
21 to such Registration Statement (Reference V), or to Post-Effective Amendment
No. 24 to such Registration Statement (Reference Y), or to Post-Effective
Amendment No. 25 to such Registration Statement (Reference Z), to Post-Effective
Amendment No. 26 to such Registration Statement (Accession No. 0000950130-95-
002856), to Post-Effective Amendment No. 27 to such Registration Statement
(Accession No. 0000950130-96-004931), to Post-Effective Amendment No. 29 to such
Registration Statement (Accession No.0000950130-97-000573), to Post-Effective
Amendment No. 31 to such Registration Statement (Accession No. 0000950130-97-
000805) and to Post-Effective Amendment No. 33 to such Registration Statement
(Accession No. 0000950130-97-0001867).
1. Agreement and Declaration of Trust. (Accession No. 0000950130-97-
000573)
2. By-laws of the Delaware business trust (Accession No. 0000950130-
97-000573)
3. Not applicable.
4. Not applicable.
5(a). Advisory Agreement between Registrant on behalf of GS Short-Term
Government Agency Fund and Goldman, Sachs & Co. (Reference P)
5(b). Advisory Agreement between Registrant on behalf of GS Adjustable
Rate Government Agency Fund and Goldman Sachs Asset Management.
(Reference P)
5(c). Advisory Agreement between Registrant on behalf of GS Short
Duration Tax-Free Fund and Goldman, Sachs & Co. (Reference P)
3
<PAGE>
5(d). Advisory Agreement between Registrant on behalf of GS Core Fixed
Income Fund and Goldman Sachs Asset Management. (Reference T)
5(e). Form of Management Agreements on behalf of Delaware business
trust (Accesssion No. 0000950130-97-000573)
6(a). Distribution Agreement between Registrant and Goldman, Sachs &
Co. (Reference P)
7. Not applicable.
8(a). Custodian Agreement between Registrant and State Street Bank and
Trust Company. (Reference P)
8(b). Form of Wiring Agreement among State Street Bank and Trust
Company, Goldman, Sachs & Co. and The Northern Trust Company.
(Reference B)
8(c). Fee schedule relating to the Custodian Agreement between
Registrant and State Street Bank and Trust Company. (Reference C)
8(d). Form of Letter Agreement between Registrant and State Street Bank
and Trust pertaining to the latter's designation of Security
Pacific National Bank as its sub-custodian and certain other
matters. (Reference C)
8(g). Form of Amendment dated August, 1989 to the Wiring Agreement
among State Street Bank and Trust Company, Goldman, Sachs & Co.
and The Northern Trust Company relating to the indemnification of
The Northern Trust Company. (Reference D)
9(a). Transfer Agency Agreement between Registrant and Goldman, Sachs &
Co. (Reference P)
9(b). Fee schedule relating to the Transfer Agency Agreement between
Registrant and Goldman, Sachs & Co. (Reference B)
10. Opinion of Delaware Counsel (Accession No. 0000950130-97-0001867)
11. Not applicable.
12. Not applicable.
13. Subscription Agreement with Goldman, Sachs & Co. (Reference B)
4
<PAGE>
14. Not applicable.
15(a). Distribution Plan pursuant to Rule 12b-1 for Goldman Sachs
Municipal Income Fund. (Reference P)
15(c). Distribution Plan pursuant to Rule 12b-1 for Goldman Sachs
Government Income Fund (Reference O)
15(d). Distribution Plan pursuant to Rule 12b-1 for Goldman Sachs Global
Income Fund. (Reference O)
15(f). Distribution Plan Pursuant to Rule 12b-1 for GS Adjustable Rate
Government Agency Fund-Class A Shares. (Reference Y)
15(h). Administration Plan and Service Plan of the Trust. (Reference X)
16. Schedule for Computation of Performance Data. (Reference V)
18. Form of Plan entered into by Registrant pursuant to Rule 18f-3.
(Reference Z)
19. Powers of Attorney of Messrs. Bakhru, Ford, Grip, Shuch, Smart,
Sringer, Strubel, Mosior, Gilman, Perlowski, Richman, Surloff,
Mmes. MacPherson, Mucker and Taylor (Accession No. 0000950130-97-
000805)
27. Financial Data Schedules (Accession No. 0000950130-97-0001867)
The following exhibit relating to Goldman Sachs Trust is filed herewith
electronically pursuant to EDGAR rules:
11. Consent of Arthur Andersen LLP.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT.
-------------------------------------------------------------
Not Applicable.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES.
-------------------------------
<TABLE>
<CAPTION>
Number of
Title of Class Record Holders
- -------------- --------------
<S> <C>
Treasury Obligations Portfolio
ILA Units 757
ILA Administration Units 78
ILA Service Units 9
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
Treasury Instruments Portfolio
ILA Units 329
ILA Administration Units 44
ILA Service Units 18
Federal Portfolio
ILA Units 2,621
ILA Administration Units 655
ILA Service Units 134
Government Portfolio
ILA Units 1,377
ILA Administration Units 67
ILA Service Units 11
Prime Obligations Portfolio
ILA Units 804
ILA Class B Units 0
ILA Administration Units 71
ILA Service Units 18
Money Market Portfolio
ILA Units 1,633
ILA Administration Units 952
ILA Service Units 6
Tax-Exempt Diversified Portfolio
ILA Units 2,249
ILA Administration Units 25
ILA Service Units 21
Tax-Exempt California Portfolio
ILA Units 870
ILA Administration Units 4
ILA Service Units 1
Tax-Exempt New York Portfolio
ILA Units 219
ILA Administration Units 68
ILA Service Units 2
Financial Square Treasury Obligations Fund
FST Shares 404
FST Administration Shares 123
FST Service Shares 663
FST Preferred Shares 15
Financial Square Prime Obligations Fund
FST Shares 474
FST Administration Shares 131
FST Service Shares 341
FST Preferred Shares 16
Financial Square Government Fund
FST Shares 252
FST Administration Shares 208
FST Service Shares 93
FST Preferred Shares 16
Financial Square Money Market Fund
FST Shares 548
FST Administration Shares 264
FST Service Shares 155
</TABLE>
6
<PAGE>
<TABLE>
<S> <C>
FST PreFerred Shares 27
Financial Square Tax-Free Money Market Fund
FST Shares 282
FST Administration Shares 52
FST Service Shares 96
FST Preferred Shares 12
Financial Square Treasury Instruments Fund
FST Shares 167
FST Administration Shares 3
FST Service Shares 7
FST Preferred Shares 2
Financial Square Federal Fund
FST Shares 193
FST Administration Shares 126
FST Service Shares 142
FST Preferred Shares 3
Financial Square Municipal Money Market Fund
FST Shares 0
FST Administration Shares 0
FST Service Shares 0
FST Preferred Shares 0
Financial Square Money Market Plus Fund
FST Shares 9
FST Administration Shares 1
FST Service Shares 1
FST Preferred Shares 1
GS Short Duration Government Fund
Institutional Shares 351
Administration Shares 33
Service Shares 6
Class A 32
Class B 20
GS Adjustable Rate Government Fund
Institutional Shares 461
Administration Shares 19
Service Shares 3
Class A Shares 384
GS Short Duration Tax-Free Fund
Institutional Shares 145
Administration Shares 5
Service Shares 0
Class A 57
Class B 10
GS Core Fixed Income Fund
Institutional Shares 183
Administration Shares 32
Service Shares 4
Class A 69
Class B 18
Goldman Sachs Global Income Fund
Institutional Shares 36
Service Shares 4
</TABLE>
7
<PAGE>
<TABLE>
<S> <C>
Class A Shares 2,793
Class B Shares 222
Goldman Sachs Government Income Fund
Class A Shares 1,030
Class B Shares 270
Goldman Sachs Municipal Income Fund
Class A Shares 1,529
Class B Shares 42
Goldman Sachs Capital Growth Fund Shares
Class A 32,826
Class B 1,355
Class C 1
Goldman Sachs CORE U.S. Equity Fund Shares
Class A 13,802
Class B 2,310
Class C 0
Institutional Class 22
Service Class 7
Goldman Sachs Small Cap Equity Fund Shares
Class A 18,109
Class B 1,863
Class C 0
Goldman Sachs International Equity Fund Shares
Class A 26,654
Class B 4,307
Class C 10
Institutional Class 42
Service Class 10
Goldman Sachs Growth and Income Fund Shares
Class A 43,882
Class B 10,172
Class C 1
Institutional Class 20
Service Class 11
Goldman Sachs Asia Growth Fund Shares
Class A 10,575
Class B 613
Class C 1
Institutional Class 11
Service Class 3
Goldman Sachs Balanced Fund Shares
Class A 4,727
Class B 674
Class C 0
Goldman Sachs Mid-Cap Equity Fund
Institutional Shares 27
Service Shares 4
Goldman Sachs CORE Large Cap Growth Fund
Class A 512
Class B 254
Class C 0
Institutional 7
</TABLE>
8
<PAGE>
<TABLE>
<S> <C>
Service 5
Goldman Sachs Emerging Markets Equity Fund
Class A 0
Class B 0
Class C 0
Institutional 0
Service 0
Goldman Sachs CORE Small Cap Equity Fund
Class A 0
Class B 0
Class C 0
Institutional 0
Service 0
Goldman Sachs CORE International Fund
Class A 0
Class B 0
Class C 0
Institutional 0
Service 0
Goldman Sachs Real Estate Securities Fund
Class A 0
Class B 0
Class C 0
Institutional 0
Service 0
</TABLE>
(Information supplied as of August 8, 1997)
ITEM 27. INDEMNIFICATION
---------------
Article III of the Declaration of Trust of Goldman Sachs Trust, the Delaware
business trust, provides for indemnification of the Trustees, offices and agents
of the Trust, subject to certain limitations. The Declaration of Trust was
filed as Exhibit 1.
The Management Agreement with each of the Funds (other than the ILA Portfolios)
provides that the applicable Investment Adviser will not be liable for any error
of judgment or mistake of law or for any loss suffered by a Fund, except a loss
resulting from wilful misfeasance, bad faith or gross negligence on the party of
the Investment Adviser or from reckless disregard by the Investment Adviser of
its obligations or duties under the Management Agreement. Section 7 of the
Advisory Agreement with respect to the ILA Portfolios provides that the ILA
Portfolios will indemnify the Adviser against certain liabilities; provided,
however, that such indemnification does not apply to any loss by reason of its
wilful misfeasance, bad faith or gross negligence or the Adviser's reckless
disregard of its obligation under the Advisory Agreement. The Management
Agreements were filed as Exhibit 5(e).
9
<PAGE>
Section XI of the Distribution Agreement and Section 7 of the Transfer Agency
Agreement between the Registrant and Goldman, Sachs & Co. dated July 15, 1991
each provides that the Registrant will indemnify Goldman, Sachs & Co. against
certain liabilities. A copy of such Agreements were filed as Exhibits 6(a) and
9(a), respectively, to the Registrant's Registration Statement.
Mutual fund and Trustees and officers liability policies purchased jointly by
the Registrant, Goldman Sachs Money Market Trust, Goldman Sachs Equity
Portfolios, Inc., Trust for Credit Unions, The Benchmark Funds and The Commerce
Funds and Goldman, Sachs & Co. insure such persons and their respective
trustees, partners, officers and employees, subject to the policies' coverage
limits and exclusions and varying deductibles, against loss resulting from
claims by reason of any act, error, omission, misstatement, misleading
statement, neglect or breach of duty.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.
----------------------------------------------------
The business and other connections of the officers and Managing Directors of
Goldman, Sachs & Co., Goldman Sachs Funds Management, L.P., and Goldman Sachs
Asset Management International are listed on their respective Forms ADV as
currently filed with the Commission (File Nos. 801-16048, 801-37591 and 801-
38157, respectively) the text of which are hereby incorporated by reference.
ITEM 29. PRINCIPAL UNDERWRITERS.
----------------------
(a). Goldman, Sachs & Co. or an affiliate or a division thereof currently
serves as investment adviser and distributor of the units of Trust for Credit
Unions and for shares of Goldman Sachs Trust. Goldman, Sachs & Co., or a
division thereof currently serves as administrator and distributor of the units
or shares of The Benchmark Funds and The Commerce Funds.
(b). Set forth below is certain information pertaining to the Managing
Directors of Goldman, Sachs & Co., the Registrant's principal underwriter, who
are members of Goldman, Sachs & Co.'s Executive Committee. None of the members
of the executive committee holds a position or office with the Registrant.
GOLDMAN SACHS EXECUTIVE COMMITTEE
Name and Principal
Business Address Position
---------------- --------
Jon S. Corzine (1) Chief Executive Officer
Robert J. Hurst (1) Managing Director
Henry M. Paulson, Jr. (1) Chief Operating Officer
10
<PAGE>
John A. Thain (1)(3) Chief Financial Officer
John L. Thornton (3) Managing Director
Roy J. Zuckerberg (2) Managing Director
_______________________
(1) 85 Broad Street, New York, NY 10004
(2) One New York Plaza, New York, NY 10004
(3) Peterborough Court, 133 Fleet Street, London EC4A 2BB, England
(c) Not Applicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS.
--------------------------------
The Declaration of Trust, By-laws and minute books of the Registrant are in the
physical possession of Goldman Sachs Asset Management, One New York Plaza, New
York, New York 10004. All other accounts, books and other documents required
to be maintained under Section 31(a) of the Investment Company Act of 1940 and
the Rule promulgated thereunder are in the physical possession of State Street
Bank and Trust Company, P.O. Box 1713, Boston, Massachusetts 02105 except for
certain transfer agency records which are maintained by Goldman, Sachs & Co.,
4900 Sears Tower, Chicago, Illinois 60606.
ITEM 31. MANAGEMENT SERVICES
-------------------
Not applicable.
ITEM 32. UNDERTAKINGS
------------
(a) The Funds undertake to furnish each person to whom a prospectus is
delivered with the latest Annual Report.
(b) With respects to Goldman Sachs CORE Small Cap Equity Fund, Goldman Sachs
CORE International Fund and Goldman Sachs Real Estate Securities Fund, the
Registrant undertakes to file a post-effective amendment, using financial
statements which need not be certified, within four to six months from the
effective date of the Post-Effective Amendment to the Registration Statement
relating to shares of such Funds.
11
<PAGE>
SIGNATURES
-----------
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, Goldman Sachs Trust, a Massachusetts business trust (the
"Massachusetts Trust") certifies that it meets all of the requirements for
effectiveness pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Post-Effective Amendment No. 38 to its Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City and State of New York on the 28th day of August, 1997.
GOLDMAN SACHS TRUST
(A Massachusett business trust)
By: Michael J. Richman
--------------------------
Michael J. Richman
Secretary
Pursuant to the requirements of the Securities Act of 1933, this Post-
Effective Amendment No. 38 to the Registration Statement of the Massachusetts
Trust has been signed below by the following persons in the capacities and on
the date indicated.
<TABLE>
<CAPTION>
NAME TITLE DATE
- ---- ----- ----
<S> <C> <C>
*Douglas C. Grip President August 28, 1997
- ------------------------
Douglas C. Grip
*Scott M. Gilman Principal Accounting August 28, 1997
- ------------------------
Scott M. Gilman Officer And Principal
Financial Officer
*David B. Ford Trustee August 28, 1997
- ------------------------
David B. Ford
*Ashok N. Bakhru Trustee August 28, 1997
- ------------------------
Ashok N. Bakhru
*Alan A. Shuch Trustee August 28, 1997
- ------------------------
Alan A. Shuch
*Jackson W. Smart Trustee August 28, 1997
- ------------------------
Jackson W. Smart, Jr.
</TABLE>
12
<PAGE>
*William H. Springer Trustee August 28, 1997
- ---------------------
William H. Springer
*Richard P. Strubel Trustee August 28, 1997
- ---------------------
Richard P. Strubel
*By: Michael J. Richman August 28, 1997
----------------------
Michael J. Richman,
Attorney-In-Fact
* Pursuant to a power of attorney previously filed.
13
<PAGE>
INDEX TO EXHIBITS
-----------------
Exhibit
- -------
11. Consent of Arthur Andersen LLP.
14
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Goldman Sachs Trust:
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 10, 1997
for the Goldman Sachs Trust Financial Square Funds (which includes, Prime
Obligations Fund, Money Market Fund, Treasury Obligations Fund, Government Fund
and Federal Tax-Free Money Market Fund) and to all references to our firm
included in or made a part of Post-Effective Amendment No. 38 and Amendment No.
40 to Registration Statement File Nos. 33-17619 and 811-5349, respectively.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
Boston, Massachusetts
August 25, 1997
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM GOLDMAN
SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET FUNDS
DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 212
<NAME> ILA PRIME OBLIGATIONS PORTFOLIO-CLASS B
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,300,736,250
<INVESTMENTS-AT-VALUE> 1,300,736,250
<RECEIVABLES> 5,670,220
<ASSETS-OTHER> 231,711
<OTHER-ITEMS-ASSETS> 557,572
<TOTAL-ASSETS> 1,307,195,753
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,403,041
<TOTAL-LIABILITIES> 6,403,041
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,300,792,712
<SHARES-COMMON-STOCK> 627,546
<SHARES-COMMON-PRIOR> 346,328
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,300,792,712
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 36,818,726
<OTHER-INCOME> 0
<EXPENSES-NET> (2,917,232)
<NET-INVESTMENT-INCOME> 33,901,494
<REALIZED-GAINS-CURRENT> 1,238
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 33,902,732
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,813)
<DISTRIBUTIONS-OF-GAINS> (2)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,106,646
<NUMBER-OF-SHARES-REDEEMED> (830,263)
<SHARES-REINVESTED> 4,835
<NET-CHANGE-IN-ASSETS> 37,214,616
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (421)
<GROSS-ADVISORY-FEES> 2,304,601
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,070,960
<AVERAGE-NET-ASSETS> 1,327,828,605
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.021
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.021)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 1.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 213
<NAME> ILA PRIME OBLIGATIONS PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,300,736,250
<INVESTMENTS-AT-VALUE> 1,300,736,250
<RECEIVABLES> 5,670,220
<ASSETS-OTHER> 231,711
<OTHER-ITEMS-ASSETS> 557,572
<TOTAL-ASSETS> 1,307,195,753
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,403,041
<TOTAL-LIABILITIES> 6,403,041
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,300,792,712
<SHARES-COMMON-STOCK> 1,175,000,909
<SHARES-COMMON-PRIOR> 1,154,745,689
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,300,792,712
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 36,818,726
<OTHER-INCOME> 0
<EXPENSES-NET> (2,917,232)
<NET-INVESTMENT-INCOME> 33,901,494
<REALIZED-GAINS-CURRENT> 1,238
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 33,902,732
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (31,099,511)
<DISTRIBUTIONS-OF-GAINS> (747)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,350,620,464
<NUMBER-OF-SHARES-REDEEMED> (3,345,057,769)
<SHARES-REINVESTED> 14,692,525
<NET-CHANGE-IN-ASSETS> 37,214,616
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (421)
<GROSS-ADVISORY-FEES> 2,304,601
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,070,960
<AVERAGE-NET-ASSETS> 1,327,828,605
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIREY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 215
<NAME> ILA PRIME OBLIGATIONS PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,300,736,250
<INVESTMENTS-AT-VALUE> 1,300,736,250
<RECEIVABLES> 5,670,220
<ASSETS-OTHER> 231,711
<OTHER-ITEMS-ASSETS> 557,572
<TOTAL-ASSETS> 1,307,195,753
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,403,041
<TOTAL-LIABILITIES> 6,403,041
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,300,792,712
<SHARES-COMMON-STOCK> 33,005,504
<SHARES-COMMON-PRIOR> 23,775,858
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,300,792,712
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 36,818,726
<OTHER-INCOME> 0
<EXPENSES-NET> (2,917,232)
<NET-INVESTMENT-INCOME> 33,901,494
<REALIZED-GAINS-CURRENT> 1,238
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 33,902,732
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (749,719)
<DISTRIBUTIONS-OF-GAINS> (19)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 135,768,531
<NUMBER-OF-SHARES-REDEEMED> (127,223,457)
<SHARES-REINVESTED> 684,572
<NET-CHANGE-IN-ASSETS> 37,214,616
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (421)
<GROSS-ADVISORY-FEES> 2,304,601
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,070,960
<AVERAGE-NET-ASSETS> 1,327,828,605
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.56
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 216
<NAME> ILA PRIME OBLIGATIONS PORTFOLIO-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,300,736,250
<INVESTMENTS-AT-VALUE> 1,300,736,250
<RECEIVABLES> 5,670,220
<ASSETS-OTHER> 231,711
<OTHER-ITEMS-ASSETS> 557,572
<TOTAL-ASSETS> 1,307,195,753
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,403,041
<TOTAL-LIABILITIES> 6,403,041
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,300,792,712
<SHARES-COMMON-STOCK> 92,158,753
<SHARES-COMMON-PRIOR> 84,710,642
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,300,792,712
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 36,818,726
<OTHER-INCOME> 0
<EXPENSES-NET> (2,917,232)
<NET-INVESTMENT-INCOME> 33,901,494
<REALIZED-GAINS-CURRENT> 1,238
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 33,902,732
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,046,451)
<DISTRIBUTIONS-OF-GAINS> (49)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 273,194,749
<NUMBER-OF-SHARES-REDEEMED> (266,890,746)
<SHARES-REINVESTED> 1,144,108
<NET-CHANGE-IN-ASSETS> 37,214,616
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (421)
<GROSS-ADVISORY-FEES> 2,304,601
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,070,960
<AVERAGE-NET-ASSETS> 1,327,828,605
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.81
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 223
<NAME> ILA MONEY MARKET PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,142,198,656
<INVESTMENTS-AT-VALUE> 1,142,198,656
<RECEIVABLES> 4,792,986
<ASSETS-OTHER> 10,660
<OTHER-ITEMS-ASSETS> 140,469
<TOTAL-ASSETS> 1,147,142,771
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,448,827
<TOTAL-LIABILITIES> 5,448,827
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,141,690,924
<SHARES-COMMON-STOCK> 818,627,520
<SHARES-COMMON-PRIOR> 703,096,586
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,020
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,141,693,944
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 31,551,085
<OTHER-INCOME> 0
<EXPENSES-NET> (2,320,192)
<NET-INVESTMENT-INCOME> 29,230,893
<REALIZED-GAINS-CURRENT> 5,729
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 29,236,622
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (20,978,957)
<DISTRIBUTIONS-OF-GAINS> (2,182)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2,908,319,866
<NUMBER-OF-SHARES-REDEEMED> (2,810,895,116)
<SHARES-REINVESTED> 18,106,184
<NET-CHANGE-IN-ASSETS> 152,494,037
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 409
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,970,975
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,614,708
<AVERAGE-NET-ASSETS> 1,135,605,243
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.36
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 225
<NAME> ILA MONEY MARKET PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,142,198,656
<INVESTMENTS-AT-VALUE> 1,142,198,656
<RECEIVABLES> 4,792,986
<ASSETS-OTHER> 10,660
<OTHER-ITEMS-ASSETS> 140,469
<TOTAL-ASSETS> 1,147,142,771
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,448,827
<TOTAL-LIABILITIES> 5,448,827
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,141,690,924
<SHARES-COMMON-STOCK> 298,516,525
<SHARES-COMMON-PRIOR> 257,258,398
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,020
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,141,693,944
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 31,551,085
<OTHER-INCOME> 0
<EXPENSES-NET> (2,320,192)
<NET-INVESTMENT-INCOME> 29,230,893
<REALIZED-GAINS-CURRENT> 5,729
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 29,236,622
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (7,677,118)
<DISTRIBUTIONS-OF-GAINS> (876)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2,045,066,180
<NUMBER-OF-SHARES-REDEEMED> (2,010,111,055)
<SHARES-REINVESTED> 6,303,002
<NET-CHANGE-IN-ASSETS> 152,494,037
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 409
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,970,975
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,614,708
<AVERAGE-NET-ASSETS> 1,135,605,243
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.51
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 226
<NAME> ILA MONEY MARKET PORTFOLIO-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,142,198,656
<INVESTMENTS-AT-VALUE> 1,142,198,656
<RECEIVABLES> 4,792,986
<ASSETS-OTHER> 10,660
<OTHER-ITEMS-ASSETS> 140,469
<TOTAL-ASSETS> 1,147,142,771
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,448,827
<TOTAL-LIABILITIES> 5,448,827
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,141,690,924
<SHARES-COMMON-STOCK> 24,546,879
<SHARES-COMMON-PRIOR> 28,844,514
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,020
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,141,693,944
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 31,551,085
<OTHER-INCOME> 0
<EXPENSES-NET> (2,320,192)
<NET-INVESTMENT-INCOME> 29,230,893
<REALIZED-GAINS-CURRENT> 5,729
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 29,236,622
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (574,818)
<DISTRIBUTIONS-OF-GAINS> (60)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 87,794,204
<NUMBER-OF-SHARES-REDEEMED> (92,264,134)
<SHARES-REINVESTED> 172,295
<NET-CHANGE-IN-ASSETS> 152,494,037
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 409
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,970,975
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,614,708
<AVERAGE-NET-ASSETS> 1,135,605,243
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.76
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 233
<NAME> ILA GOVERNMENT PORTFOLIO-INSTITUTIONAL SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 540,828,714
<INVESTMENTS-AT-VALUE> 540,828,714
<RECEIVABLES> 2,825,131
<ASSETS-OTHER> 4,361
<OTHER-ITEMS-ASSETS> 377,130
<TOTAL-ASSETS> 544,035,336
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,682,760
<TOTAL-LIABILITIES> 2,682,760
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 541,306,770
<SHARES-COMMON-STOCK> 448,716,539
<SHARES-COMMON-PRIOR> 694,604,345
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 45,806
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 541,352,576
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20,415,357
<OTHER-INCOME> 0
<EXPENSES-NET> (1,755,483)
<NET-INVESTMENT-INCOME> 18,659,874
<REALIZED-GAINS-CURRENT> 39,273
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18,699,147
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (15,587,434)
<DISTRIBUTIONS-OF-GAINS> (53,496)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,924,754,590
<NUMBER-OF-SHARES-REDEEMED> (2,178,032,034)
<SHARES-REINVESTED> 7,389,638
<NET-CHANGE-IN-ASSETS> (283,581,375)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 71,523
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,296,807
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,755,483
<AVERAGE-NET-ASSETS> 747,173,835
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 235
<NAME> ILA GOVERNMENT PORTFOLIO-ADMINISTRATION SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 540,828,714
<INVESTMENTS-AT-VALUE> 540,828,714
<RECEIVABLES> 2,825,131
<ASSETS-OTHER> 4,361
<OTHER-ITEMS-ASSETS> 377,130
<TOTAL-ASSETS> 544,035,336
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,682,760
<TOTAL-LIABILITIES> 2,682,760
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 541,306,770
<SHARES-COMMON-STOCK> 10,011,985
<SHARES-COMMON-PRIOR> 36,044,854
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 45,806
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 541,352,576
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20,415,357
<OTHER-INCOME> 0
<EXPENSES-NET> (1,755,483)
<NET-INVESTMENT-INCOME> 18,659,874
<REALIZED-GAINS-CURRENT> 39,273
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18,699,147
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (635,632)
<DISTRIBUTIONS-OF-GAINS> (2,184)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 61,155,315
<NUMBER-OF-SHARES-REDEEMED> (87,310,534)
<SHARES-REINVESTED> 122,350
<NET-CHANGE-IN-ASSETS> (283,581,375)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 71,523
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,296,807
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,755,483
<AVERAGE-NET-ASSETS> 747,173,835
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.56
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 236
<NAME> ILA GOVERNMENT PORTFOLIO-SERVICE SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 540,828,714
<INVESTMENTS-AT-VALUE> 540,828,714
<RECEIVABLES> 2,825,131
<ASSETS-OTHER> 4,361
<OTHER-ITEMS-ASSETS> 377,130
<TOTAL-ASSETS> 544,035,336
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,682,760
<TOTAL-LIABILITIES> 2,682,760
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 541,306,770
<SHARES-COMMON-STOCK> 82,578,246
<SHARES-COMMON-PRIOR> 94,213,229
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 45,806
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 541,352,576
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20,415,357
<OTHER-INCOME> 0
<EXPENSES-NET> (1,755,483)
<NET-INVESTMENT-INCOME> 18,659,874
<REALIZED-GAINS-CURRENT> 39,273
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18,699,147
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,436,808)
<DISTRIBUTIONS-OF-GAINS> (9,310)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 212,952,582
<NUMBER-OF-SHARES-REDEEMED> (226,434,987)
<SHARES-REINVESTED> 1,847,422
<NET-CHANGE-IN-ASSETS> (283,581,375)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 71,523
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,296,807
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,755,483
<AVERAGE-NET-ASSETS> 747,173,835
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.023
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.023)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.81
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 243
<NAME> ILA TREASURY OBLIGATIONS PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 780,377,857
<INVESTMENTS-AT-VALUE> 780,377,857
<RECEIVABLES> 1,744,407
<ASSETS-OTHER> 4,858
<OTHER-ITEMS-ASSETS> 39,605
<TOTAL-ASSETS> 782,166,727
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,227,128
<TOTAL-LIABILITIES> 3,227,128
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 778,938,312
<SHARES-COMMON-STOCK> 511,112,612
<SHARES-COMMON-PRIOR> 574,608,995
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,287
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 778,939,599
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20,288,543
<OTHER-INCOME> 0
<EXPENSES-NET> (1,831,485)
<NET-INVESTMENT-INCOME> 18,457,058
<REALIZED-GAINS-CURRENT> 54,081
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18,511,139
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (13,549,901)
<DISTRIBUTIONS-OF-GAINS> (60,363)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,762,782,076
<NUMBER-OF-SHARES-REDEEMED> (1,832,017,336)
<SHARES-REINVESTED> 5,738,877
<NET-CHANGE-IN-ASSETS> (28,126,951)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 30,784
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,299,943
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,853,425
<AVERAGE-NET-ASSETS> 748,980,487
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL REPORT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 245
<NAME> ILA TREASURY OBLIGATIONS PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 780,377,857
<INVESTMENTS-AT-VALUE> 780,377,857
<RECEIVABLES> 1,744,407
<ASSETS-OTHER> 4,858
<OTHER-ITEMS-ASSETS> 39,605
<TOTAL-ASSETS> 782,166,727
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,227,128
<TOTAL-LIABILITIES> 3,227,128
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 778,938,312
<SHARES-COMMON-STOCK> 126,423,998
<SHARES-COMMON-PRIOR> 108,916,431
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,287
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 778,939,599
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20,288,543
<OTHER-INCOME> 0
<EXPENSES-NET> (1,831,485)
<NET-INVESTMENT-INCOME> 18,457,058
<REALIZED-GAINS-CURRENT> 54,081
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18,511,139
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,256,930)
<DISTRIBUTIONS-OF-GAINS> (10,461)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 230,971,899
<NUMBER-OF-SHARES-REDEEMED> 213,684,999
<SHARES-REINVESTED> 220,667
<NET-CHANGE-IN-ASSETS> (28,126,951)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 30,784
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,299,943
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,853,425
<AVERAGE-NET-ASSETS> 748,980,487
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.56
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 246
<NAME> ILA TREASURY OBLIGATIONS PORTFOLIO-SERVICE SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 780,377,857
<INVESTMENTS-AT-VALUE> 780,377,857
<RECEIVABLES> 1,744,407
<ASSETS-OTHER> 4,858
<OTHER-ITEMS-ASSETS> 39,605
<TOTAL-ASSETS> 782,166,727
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,227,128
<TOTAL-LIABILITIES> 3,227,128
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 778,938,312
<SHARES-COMMON-STOCK> 141,401,702
<SHARES-COMMON-PRIOR> 123,510,340
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,287
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 778,939,599
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 20,288,543
<OTHER-INCOME> 0
<EXPENSES-NET> (1,831,485)
<NET-INVESTMENT-INCOME> 18,457,058
<REALIZED-GAINS-CURRENT> 54,081
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 18,511,139
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,650,227)
<DISTRIBUTIONS-OF-GAINS> (12,754)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 517,403,519
<NUMBER-OF-SHARES-REDEEMED> (500,172,273)
<SHARES-REINVESTED> 660,116
<NET-CHANGE-IN-ASSETS> (28,126,951)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 30,784
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,299,943
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,853,425
<AVERAGE-NET-ASSETS> 748,980,487
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.023
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.023)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.81
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY MARKET
FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 25
<NAME> ILA TREASURY INSTRUMENTS PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 753,931,928
<INVESTMENTS-AT-VALUE> 753,931,928
<RECEIVABLES> 12,497,120
<ASSETS-OTHER> 5,543
<OTHER-ITEMS-ASSETS> 306,146
<TOTAL-ASSETS> 766,740,737
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,516,273
<TOTAL-LIABILITIES> 3,516,273
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 763,220,615
<SHARES-COMMON-STOCK> 334,968,813
<SHARES-COMMON-PRIOR> 708,990,271
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,849
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 763,224,464
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 22,781,661
<OTHER-INCOME> 0
<EXPENSES-NET> (1,579,355)
<NET-INVESTMENT-INCOME> 21,202,306
<REALIZED-GAINS-CURRENT> 38,676
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 21,240,982
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (12,526,985)
<DISTRIBUTIONS-OF-GAINS> (27,381)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,667,129,939
<NUMBER-OF-SHARES-REDEEMED> (2,050,046,518)
<SHARES-REINVESTED> 8,895,121
<NET-CHANGE-IN-ASSETS> (467,381,219)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 15,350
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,533,942
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,510,206
<AVERAGE-NET-ASSETS> 883,802,079
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.21
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 25
<NAME> ILA TREASURY INSTRUMENTS PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 753,931,928
<INVESTMENTS-AT-VALUE> 753,931,928
<RECEIVABLES> 12,497,120
<ASSETS-OTHER> 5,543
<OTHER-ITEMS-ASSETS> 306,146
<TOTAL-ASSETS> 766,740,737
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,516,273
<TOTAL-LIABILITIES> 3,516,273
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 763,220,615
<SHARES-COMMON-STOCK> 93,941,688
<SHARES-COMMON-PRIOR> 137,701,171
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,849
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 763,224,464
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 22,781,661
<OTHER-INCOME> 0
<EXPENSES-NET> (1,579,355)
<NET-INVESTMENT-INCOME> 21,202,306
<REALIZED-GAINS-CURRENT> 38,676
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 21,240,982
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,952,923)
<DISTRIBUTIONS-OF-GAINS> (5,258)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 181,044,845
<NUMBER-OF-SHARES-REDEEMED> (225,303,784)
<SHARES-REINVESTED> 499,456
<NET-CHANGE-IN-ASSETS> (467,381,219)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 15,350
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,533,942
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,510,206
<AVERAGE-NET-ASSETS> 883,802,079
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.36
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 25
<NAME> ILA TREASURY INSTRUMENTS PORTFOLIO-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 753,931,928
<INVESTMENTS-AT-VALUE> 753,931,928
<RECEIVABLES> 12,497,120
<ASSETS-OTHER> 5,543
<OTHER-ITEMS-ASSETS> 306,146
<TOTAL-ASSETS> 766,740,737
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,516,273
<TOTAL-LIABILITIES> 3,516,273
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 763,220,615
<SHARES-COMMON-STOCK> 334,310,114
<SHARES-COMMON-PRIOR> 383,898,891
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,849
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 763,224,464
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 22,781,661
<OTHER-INCOME> 0
<EXPENSES-NET> (1,579,355)
<NET-INVESTMENT-INCOME> 21,202,306
<REALIZED-GAINS-CURRENT> 38,676
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 21,240,982
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (6,722,398)
<DISTRIBUTIONS-OF-GAINS> (17,538)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 349,907,234
<NUMBER-OF-SHARES-REDEEMED> (339,535,859)
<SHARES-REINVESTED> 39,848
<NET-CHANGE-IN-ASSETS> (467,381,219)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 15,350
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,533,942
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,510,206
<AVERAGE-NET-ASSETS> 883,802,079
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.023
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.023)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.61
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 26
<NAME> ILA FEDERAL PORTFOLIO-INSTITUTIONAL SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,302,817,253
<INVESTMENTS-AT-VALUE> 2,302,817,253
<RECEIVABLES> 6,786,880
<ASSETS-OTHER> 18,013
<OTHER-ITEMS-ASSETS> 2,458,781
<TOTAL-ASSETS> 2,312,080,927
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 11,367,693
<TOTAL-LIABILITIES> 11,367,693
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,300,713,234
<SHARES-COMMON-STOCK> 1,576,686,979
<SHARES-COMMON-PRIOR> 2,303,703,731
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (520)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,300,713,234
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 79,599,126
<OTHER-INCOME> 0
<EXPENSES-NET> (4,634,708)
<NET-INVESTMENT-INCOME> 74,964,418
<REALIZED-GAINS-CURRENT> 73,578
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 75,037,996
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (54,464,717)
<DISTRIBUTIONS-OF-GAINS> (3,814)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6,237,841,459
<NUMBER-OF-SHARES-REDEEMED> (7,007,897,193)
<SHARES-REINVESTED> 43,038,982
<NET-CHANGE-IN-ASSETS> (989,917,042)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (68,833)
<GROSS-ADVISORY-FEES> 5,088,963
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,774,268
<AVERAGE-NET-ASSETS> 2,932,078,303
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.26
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 26
<NAME> ILA FEDERAL PORTFOLIO-ADMINISTRATION SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,302,817,253
<INVESTMENTS-AT-VALUE> 2,302,817,253
<RECEIVABLES> 6,786,880
<ASSETS-OTHER> 18,013
<OTHER-ITEMS-ASSETS> 2,458,781
<TOTAL-ASSETS> 2,312,080,927
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 11,367,693
<TOTAL-LIABILITIES> 11,367,693
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,300,713,234
<SHARES-COMMON-STOCK> 664,317,311
<SHARES-COMMON-PRIOR> 794,578,398
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (520)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,300,713,234
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 79,599,126
<OTHER-INCOME> 0
<EXPENSES-NET> (4,634,708)
<NET-INVESTMENT-INCOME> 74,964,418
<REALIZED-GAINS-CURRENT> 73,578
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 75,037,996
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (16,678,440)
<DISTRIBUTIONS-OF-GAINS> (1,246)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2,164,353,021
<NUMBER-OF-SHARES-REDEEMED> (2,302,579,048)
<SHARES-REINVESTED> 7,964,940
<NET-CHANGE-IN-ASSETS> (989,917,042)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (68,833)
<GROSS-ADVISORY-FEES> 5,088,963
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,774,268
<AVERAGE-NET-ASSETS> 2,932,078,303
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 26
<NAME> ILA FEDERAL PORTFOLIO-SERVICE SHARES
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,302,817,253
<INVESTMENTS-AT-VALUE> 2,302,817,253
<RECEIVABLES> 6,786,880
<ASSETS-OTHER> 18,013
<OTHER-ITEMS-ASSETS> 2,458,781
<TOTAL-ASSETS> 2,312,080,927
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 11,367,693
<TOTAL-LIABILITIES> 11,367,693
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,300,713,234
<SHARES-COMMON-STOCK> 59,709,464
<SHARES-COMMON-PRIOR> 192,416,980
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (520)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,300,713,234
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 79,599,126
<OTHER-INCOME> 0
<EXPENSES-NET> (4,634,708)
<NET-INVESTMENT-INCOME> 74,964,418
<REALIZED-GAINS-CURRENT> 73,578
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 75,037,996
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (3,821,261)
<DISTRIBUTIONS-OF-GAINS> (205)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 528,472,623
<NUMBER-OF-SHARES-REDEEMED> (662,343,632)
<SHARES-REINVESTED> 1,162,493
<NET-CHANGE-IN-ASSETS> (989,917,042)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (68,833)
<GROSS-ADVISORY-FEES> 5,088,963
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,774,268
<AVERAGE-NET-ASSETS> 2,932,078,303
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.66
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 27
<NAME> ILA TAX-EXEMPT DIVERSIFIED PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,527,913,444
<INVESTMENTS-AT-VALUE> 1,527,913,444
<RECEIVABLES> 12,123,421
<ASSETS-OTHER> 75,981
<OTHER-ITEMS-ASSETS> 534,437
<TOTAL-ASSETS> 1,540,647,283
<PAYABLE-FOR-SECURITIES> 17,100,341
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,878,724
<TOTAL-LIABILITIES> 21,979,065
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,518,550,991
<SHARES-COMMON-STOCK> 1,439,400,936
<SHARES-COMMON-PRIOR> 1,514,523,522
<ACCUMULATED-NII-CURRENT> 362,642
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (245,415)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,518,668,218
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 28,921,005
<OTHER-INCOME> 0
<EXPENSES-NET> (2,670,961)
<NET-INVESTMENT-INCOME> 26,250,044
<REALIZED-GAINS-CURRENT> (1,025)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 26,249,019
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (24,783,319)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,670,298,460
<NUMBER-OF-SHARES-REDEEMED> (4,765,380,801)
<SHARES-REINVESTED> 19,959,755
<NET-CHANGE-IN-ASSETS> (83,792,595)
<ACCUMULATED-NII-PRIOR> 362,642
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (244,390)
<GROSS-ADVISORY-FEES> 2,839,675
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,549,473
<AVERAGE-NET-ASSETS> 1,636,119,119
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.016
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.016)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.31
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 27
<NAME> ILA TAX-EXEMPT DIVERSIFIED PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,527,913,444
<INVESTMENTS-AT-VALUE> 1,527,913,444
<RECEIVABLES> 12,123,421
<ASSETS-OTHER> 75,981
<OTHER-ITEMS-ASSETS> 534,437
<TOTAL-ASSETS> 1,540,647,283
<PAYABLE-FOR-SECURITIES> 17,100,341
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,878,724
<TOTAL-LIABILITIES> 21,979,065
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,518,550,991
<SHARES-COMMON-STOCK> 39,370,344
<SHARES-COMMON-PRIOR> 59,097,259
<ACCUMULATED-NII-CURRENT> 362,642
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (245,415)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,518,668,218
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 28,921,005
<OTHER-INCOME> 0
<EXPENSES-NET> (2,670,961)
<NET-INVESTMENT-INCOME> 26,250,044
<REALIZED-GAINS-CURRENT> (1,025)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 26,249,019
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (791,248)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 41,568,155
<NUMBER-OF-SHARES-REDEEMED> (61,378,482)
<SHARES-REINVESTED> 83,412
<NET-CHANGE-IN-ASSETS> (83,792,595)
<ACCUMULATED-NII-PRIOR> 362,642
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (244,390)
<GROSS-ADVISORY-FEES> 2,839,675
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,549,473
<AVERAGE-NET-ASSETS> 1,636,119,119
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.46
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 27
<NAME> ILA TAX-EXEMPT DIVERSIFIED PORTFOLIO-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,527,913,444
<INVESTMENTS-AT-VALUE> 1,527,913,444
<RECEIVABLES> 12,123,421
<ASSETS-OTHER> 75,981
<OTHER-ITEMS-ASSETS> 534,437
<TOTAL-ASSETS> 1,540,647,283
<PAYABLE-FOR-SECURITIES> 17,100,341
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,878,724
<TOTAL-LIABILITIES> 21,979,065
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,518,550,991
<SHARES-COMMON-STOCK> 39,976,303
<SHARES-COMMON-PRIOR> 28,918,372
<ACCUMULATED-NII-CURRENT> 362,642
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (245,415)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1,518,668,218
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 28,921,005
<OTHER-INCOME> 0
<EXPENSES-NET> (2,670,961)
<NET-INVESTMENT-INCOME> 26,250,044
<REALIZED-GAINS-CURRENT> (1,025)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 26,249,019
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (675,477)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 98,849,724
<NUMBER-OF-SHARES-REDEEMED> (88,170,603)
<SHARES-REINVESTED> 378,810
<NET-CHANGE-IN-ASSETS> (83,792,595)
<ACCUMULATED-NII-PRIOR> 362,642
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (244,390)
<GROSS-ADVISORY-FEES> 2,839,675
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,549,473
<AVERAGE-NET-ASSETS> 1,636,119,119
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.71
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 28
<NAME> ILA TAX-EXEMPT CALIFORNIA PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 477,864,590
<INVESTMENTS-AT-VALUE> 477,864,590
<RECEIVABLES> 3,362,359
<ASSETS-OTHER> 32,512
<OTHER-ITEMS-ASSETS> 48,551,676
<TOTAL-ASSETS> 529,811,137
<PAYABLE-FOR-SECURITIES> 21,864,747
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,569,552
<TOTAL-LIABILITIES> 23,434,299
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 506,395,032
<SHARES-COMMON-STOCK> 506,030,319
<SHARES-COMMON-PRIOR> 440,495,857
<ACCUMULATED-NII-CURRENT> 10,495
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (28,689)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 506,376,838
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 8,196,886
<OTHER-INCOME> 0
<EXPENSES-NET> (972,498)
<NET-INVESTMENT-INCOME> 7,224,388
<REALIZED-GAINS-CURRENT> 1,331
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 7,225,719
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (7,219,332)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,646,349,481
<NUMBER-OF-SHARES-REDEEMED> (1,587,397,014)
<SHARES-REINVESTED> 6,581,995
<NET-CHANGE-IN-ASSETS> 65,758,484
<ACCUMULATED-NII-PRIOR> 10,495
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (30,020)
<GROSS-ADVISORY-FEES> 823,200
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,002,317
<AVERAGE-NET-ASSETS> 474,298,299
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.41
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 28
<NAME> ILA TAX-EXEMPT CALIFORNIA PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 477,864,590
<INVESTMENTS-AT-VALUE> 477,864,590
<RECEIVABLES> 3,362,359
<ASSETS-OTHER> 32,512
<OTHER-ITEMS-ASSETS> 48,551,676
<TOTAL-ASSETS> 529,811,137
<PAYABLE-FOR-SECURITIES> 21,864,747
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,569,552
<TOTAL-LIABILITIES> 23,434,299
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 506,395,032
<SHARES-COMMON-STOCK> 364,713
<SHARES-COMMON-PRIOR> 142,022
<ACCUMULATED-NII-CURRENT> 10,495
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (28,689)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 506,376,838
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 8,196,886
<OTHER-INCOME> 0
<EXPENSES-NET> (972,498)
<NET-INVESTMENT-INCOME> 7,224,388
<REALIZED-GAINS-CURRENT> 1,331
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 7,225,719
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,056)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 724,321
<NUMBER-OF-SHARES-REDEEMED> (501,911)
<SHARES-REINVESTED> 281
<NET-CHANGE-IN-ASSETS> 65,758,484
<ACCUMULATED-NII-PRIOR> 10,495
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (30,020)
<GROSS-ADVISORY-FEES> 823,200
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,002,317
<AVERAGE-NET-ASSETS> 474,298,299
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.56
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 29
<NAME> ILA TAX-EXEMPT NEW YORK PORTFOLIO-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 109,546,005
<INVESTMENTS-AT-VALUE> 109,546,005
<RECEIVABLES> 621,487
<ASSETS-OTHER> 523
<OTHER-ITEMS-ASSETS> 145,047
<TOTAL-ASSETS> 110,313,062
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 314,726
<TOTAL-LIABILITIES> 314,726
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 110,003,221
<SHARES-COMMON-STOCK> 64,377,577
<SHARES-COMMON-PRIOR> 70,178,026
<ACCUMULATED-NII-CURRENT> 1,634
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (6,519)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 109,998,336
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,883,639
<OTHER-INCOME> 0
<EXPENSES-NET> (197,610)
<NET-INVESTMENT-INCOME> 1,686,029
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 1,686,029
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,199,325)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 238,303,240
<NUMBER-OF-SHARES-REDEEMED> (245,190,270)
<SHARES-REINVESTED> 1,086,581
<NET-CHANGE-IN-ASSETS> (4,496,145)
<ACCUMULATED-NII-PRIOR> 1,634
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (6,519)
<GROSS-ADVISORY-FEES> 188,173
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 248,889
<AVERAGE-NET-ASSETS> 108,418,478
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.016
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.016)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.32
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 29
<NAME> ILA TAX-EXEMPT NEW YORK PORTFOLIO-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 109,546,005
<INVESTMENTS-AT-VALUE> 109,546,005
<RECEIVABLES> 621,487
<ASSETS-OTHER> 523
<OTHER-ITEMS-ASSETS> 145,047
<TOTAL-ASSETS> 110,313,062
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 314,726
<TOTAL-LIABILITIES> 314,726
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 110,003,221
<SHARES-COMMON-STOCK> 45,625,644
<SHARES-COMMON-PRIOR> 44,321,340
<ACCUMULATED-NII-CURRENT> 1,634
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (6,519)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 109,998,336
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,883,639
<OTHER-INCOME> 0
<EXPENSES-NET> (197,610)
<NET-INVESTMENT-INCOME> 1,686,029
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 1,686,029
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (486,704)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 182,900,162
<NUMBER-OF-SHARES-REDEEMED> (182,067,302)
<SHARES-REINVESTED> 471,444
<NET-CHANGE-IN-ASSETS> (4,496,145)
<ACCUMULATED-NII-PRIOR> 1,634
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (6,519)
<GROSS-ADVISORY-FEES> 188,173
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 248,889
<AVERAGE-NET-ASSETS> 108,418,478
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.47
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 35
<NAME> FINANCIAL SQUARE PRIME OLIGATIONS FUND-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,474,859,659
<INVESTMENTS-AT-VALUE> 4,474,859,659
<RECEIVABLES> 20,217,354
<ASSETS-OTHER> 265,919
<OTHER-ITEMS-ASSETS> 56,418
<TOTAL-ASSETS> 4,495,399,350
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 25,129,759
<TOTAL-LIABILITIES> 25,129,759
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,470,268,862
<SHARES-COMMON-STOCK> 3,813,081,114
<SHARES-COMMON-PRIOR> 3,901,792,070
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 729
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,470,269,591
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 150,778,630
<OTHER-INCOME> 0
<EXPENSES-NET> (5,594,457)
<NET-INVESTMENT-INCOME> 145,184,173
<REALIZED-GAINS-CURRENT> 13,632
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 145,197,805
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (131,189,598)
<DISTRIBUTIONS-OF-GAINS> (12,652)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 25,861,076,069
<NUMBER-OF-SHARES-REDEEMED> (26,009,699,328)
<SHARES-REINVESTED> 59,912,303
<NET-CHANGE-IN-ASSETS> 110,293,385
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1,090
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,549,296
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 7,054,668
<AVERAGE-NET-ASSETS> 5,458,813,978
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.027
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.027)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 35
<NAME> FINANCIAL SQUARE PRIME OBLIGATIONS FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,474,859,659
<INVESTMENTS-AT-VALUE> 4,474,859,659
<RECEIVABLES> 20,217,354
<ASSETS-OTHER> 265,919
<OTHER-ITEMS-ASSETS> 56,418
<TOTAL-ASSETS> 4,495,399,350
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 25,129,759
<TOTAL-LIABILITIES> 25,129,759
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,470,268,862
<SHARES-COMMON-STOCK> 240,046,253
<SHARES-COMMON-PRIOR> 127,128,734
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 729
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,470,269,591
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 150,778,630
<OTHER-INCOME> 0
<EXPENSES-NET> (5,594,457)
<NET-INVESTMENT-INCOME> 145,184,173
<REALIZED-GAINS-CURRENT> 13,632
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 145,197,805
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (4,222,876)
<DISTRIBUTIONS-OF-GAINS> (335)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 702,667,176
<NUMBER-OF-SHARES-REDEEMED> (589,926,457)
<SHARES-REINVESTED> 176,800
<NET-CHANGE-IN-ASSETS> 110,293,385
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1,090
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,549,296
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 7,054,668
<AVERAGE-NET-ASSETS> 5,458,813,978
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 35
<NAME> FINANCIAL SQUARE PRIME OBLIGATIONS FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,474,859,659
<INVESTMENTS-AT-VALUE> 4,474,859,659
<RECEIVABLES> 20,217,354
<ASSETS-OTHER> 265,919
<OTHER-ITEMS-ASSETS> 56,418
<TOTAL-ASSETS> 4,495,399,350
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 25,129,759
<TOTAL-LIABILITIES> 25,129,759
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,470,268,862
<SHARES-COMMON-STOCK> 295,976,966
<SHARES-COMMON-PRIOR> 215,900,253
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 729
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,470,269,591
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 150,778,630
<OTHER-INCOME> 0
<EXPENSES-NET> (5,594,457)
<NET-INVESTMENT-INCOME> 145,184,173
<REALIZED-GAINS-CURRENT> 13,632
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 145,197,805
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (6,635,324)
<DISTRIBUTIONS-OF-GAINS> (675)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 902,415,355
<NUMBER-OF-SHARES-REDEEMED> (824,443,074)
<SHARES-REINVESTED> 2,104,432
<NET-CHANGE-IN-ASSETS> 110,293,385
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1,090
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,549,296
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 7,054,668
<AVERAGE-NET-ASSETS> 5,458,813,978
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 35
<NAME> FINANCIAL SQUARE PRIME OBLIGATIONS FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,474,859,659
<INVESTMENTS-AT-VALUE> 4,474,859,659
<RECEIVABLES> 20,217,354
<ASSETS-OTHER> 265,919
<OTHER-ITEMS-ASSETS> 56,418
<TOTAL-ASSETS> 4,495,399,350
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 25,129,759
<TOTAL-LIABILITIES> 25,129,759
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,470,268,862
<SHARES-COMMON-STOCK> 121,164,529
<SHARES-COMMON-PRIOR> 115,154,059
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 729
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,470,269,591
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 150,778,630
<OTHER-INCOME> 0
<EXPENSES-NET> (5,594,457)
<NET-INVESTMENT-INCOME> 145,184,173
<REALIZED-GAINS-CURRENT> 13,632
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 145,197,805
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (3,136,375)
<DISTRIBUTIONS-OF-GAINS> (331)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,038,103,985
<NUMBER-OF-SHARES-REDEEMED> (1,033,969,432)
<SHARES-REINVESTED> 1,875,917
<NET-CHANGE-IN-ASSETS> 110,293,385
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 1,090
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,549,296
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 7,054,668
<AVERAGE-NET-ASSETS> 5,458,813,978
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 36
<NAME> FINANCIAL SQUARE MONEY MARKET FUND-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,606,059,517
<INVESTMENTS-AT-VALUE> 4,606,059,517
<RECEIVABLES> 19,572,861
<ASSETS-OTHER> 141,603
<OTHER-ITEMS-ASSETS> 82,960
<TOTAL-ASSETS> 4,625,856,941
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 23,598,869
<TOTAL-LIABILITIES> 23,598,869
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,602,242,978
<SHARES-COMMON-STOCK> 3,991,996,825
<SHARES-COMMON-PRIOR> 2,540,361,007
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,094
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,602,258,072
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 123,020,722
<OTHER-INCOME> 0
<EXPENSES-NET> (5,118,373)
<NET-INVESTMENT-INCOME> 117,902,349
<REALIZED-GAINS-CURRENT> 24,659
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 117,927,008
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (102,274,186)
<DISTRIBUTIONS-OF-GAINS> (9,091)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 31,009,843,613
<NUMBER-OF-SHARES-REDEEMED> (29,608,727,868)
<SHARES-REINVESTED> 50,520,073
<NET-CHANGE-IN-ASSETS> 1,644,226,157
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 954
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,491,570
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,165,869
<AVERAGE-NET-ASSETS> 4,418,334,727
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.027
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.027)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 36
<NAME> FINANCIAL SQUARE MONEY MARKET FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,606,059,517
<INVESTMENTS-AT-VALUE> 4,606,059,517
<RECEIVABLES> 19,572,861
<ASSETS-OTHER> 141,603
<OTHER-ITEMS-ASSETS> 82,960
<TOTAL-ASSETS> 4,625,856,941
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 23,598,869
<TOTAL-LIABILITIES> 23,598,869
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,602,242,978
<SHARES-COMMON-STOCK> 43,756,223
<SHARES-COMMON-PRIOR> 17,510,550
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,094
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,602,258,072
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 123,020,722
<OTHER-INCOME> 0
<EXPENSES-NET> (5,118,373)
<NET-INVESTMENT-INCOME> 117,902,349
<REALIZED-GAINS-CURRENT> 24,659
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 117,927,008
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (761,752)
<DISTRIBUTIONS-OF-GAINS> (81)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 165,812,836
<NUMBER-OF-SHARES-REDEEMED> (140,035,071)
<SHARES-REINVESTED> 467,908
<NET-CHANGE-IN-ASSETS> 1,644,226,157
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 954
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,491,570
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,165,869
<AVERAGE-NET-ASSETS> 4,418,334,727
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 36
<NAME> FINANCIAL SQUARE MONEY MARKET FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,606,059,517
<INVESTMENTS-AT-VALUE> 4,606,059,517
<RECEIVABLES> 19,572,861
<ASSETS-OTHER> 141,603
<OTHER-ITEMS-ASSETS> 82,960
<TOTAL-ASSETS> 4,625,856,941
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 23,598,869
<TOTAL-LIABILITIES> 23,598,869
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,602,242,978
<SHARES-COMMON-STOCK> 276,148,987
<SHARES-COMMON-PRIOR> 165,764,727
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,094
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,602,258,072
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 123,020,722
<OTHER-INCOME> 0
<EXPENSES-NET> (5,118,373)
<NET-INVESTMENT-INCOME> 117,902,349
<REALIZED-GAINS-CURRENT> 24,659
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 117,927,008
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (6,533,435)
<DISTRIBUTIONS-OF-GAINS> (591)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 939,526,100
<NUMBER-OF-SHARES-REDEEMED> (833,277,833)
<SHARES-REINVESTED> 4,135,993
<NET-CHANGE-IN-ASSETS> 1,644,226,157
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 954
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,491,570
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,165,869
<AVERAGE-NET-ASSETS> 4,418,334,727
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 36
<NAME> FINANCIAL SQUARE MONEY MARKET FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 4,606,059,517
<INVESTMENTS-AT-VALUE> 4,606,059,517
<RECEIVABLES> 19,572,861
<ASSETS-OTHER> 141,603
<OTHER-ITEMS-ASSETS> 82,960
<TOTAL-ASSETS> 4,625,856,941
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 23,598,869
<TOTAL-LIABILITIES> 23,598,869
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,602,242,978
<SHARES-COMMON-STOCK> 290,340,943
<SHARES-COMMON-PRIOR> 234,380,537
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,094
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 4,602,258,072
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 123,020,722
<OTHER-INCOME> 0
<EXPENSES-NET> (5,118,373)
<NET-INVESTMENT-INCOME> 117,902,349
<REALIZED-GAINS-CURRENT> 24,659
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 117,927,008
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (8,332,976)
<DISTRIBUTIONS-OF-GAINS> (756)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 553,952,055
<NUMBER-OF-SHARES-REDEEMED> (498,747,675)
<SHARES-REINVESTED> 756,026
<NET-CHANGE-IN-ASSETS> 1,644,226,157
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 954
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,491,570
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 6,165,869
<AVERAGE-NET-ASSETS> 4,418,334,727
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 37
<NAME> FINANCIAL SQUARE TREASURY OBLIGATIONS FUND-INST.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 3,021,771,573
<INVESTMENTS-AT-VALUE> 3,021,771,573
<RECEIVABLES> 6,319,006
<ASSETS-OTHER> 140,163
<OTHER-ITEMS-ASSETS> 35,130
<TOTAL-ASSETS> 3,028,265,872
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 14,542,205
<TOTAL-LIABILITIES> 14,542,205
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,013,687,919
<SHARES-COMMON-STOCK> 2,140,037,970
<SHARES-COMMON-PRIOR> 2,290,967,452
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 35,748
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 3,013,723,667
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 78,310,881
<OTHER-INCOME> 0
<EXPENSES-NET> (3,859,518)
<NET-INVESTMENT-INCOME> 74,451,363
<REALIZED-GAINS-CURRENT> 174,705
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 74,626,068
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (54,078,253)
<DISTRIBUTIONS-OF-GAINS> (155,521)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 9,588,228,683
<NUMBER-OF-SHARES-REDEEMED> (9,757,793,211)
<SHARES-REINVESTED> 18,635,046
<NET-CHANGE-IN-ASSETS> (81,419,266)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 80,038
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2,940,015
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,711,744
<AVERAGE-NET-ASSETS> 2,892,078,072
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 37
<NAME> FINANCIAL SQUARE TREASURY OBLIGATIONS FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 3,021,771,573
<INVESTMENTS-AT-VALUE> 3,021,771,573
<RECEIVABLES> 6,319,006
<ASSETS-OTHER> 140,163
<OTHER-ITEMS-ASSETS> 35,130
<TOTAL-ASSETS> 3,028,265,872
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 14,542,205
<TOTAL-LIABILITIES> 14,542,205
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,013,687,919
<SHARES-COMMON-STOCK> 2,825,740
<SHARES-COMMON-PRIOR> 46,636,593
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 35,748
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 3,013,723,667
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 78,310,881
<OTHER-INCOME> 0
<EXPENSES-NET> (3,859,518)
<NET-INVESTMENT-INCOME> 74,451,363
<REALIZED-GAINS-CURRENT> 174,705
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 74,626,068
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (525,690)
<DISTRIBUTIONS-OF-GAINS> (1,317)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 46,161,803
<NUMBER-OF-SHARES-REDEEMED> (90,584,204)
<SHARES-REINVESTED> 611,548
<NET-CHANGE-IN-ASSETS> (81,419,266)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 80,038
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2,940,015
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,711,744
<AVERAGE-NET-ASSETS> 2,892,078,072
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 37
<NAME> FINANCIAL SQUARE TREASURY OBLIGATIONS FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 3,021,771,573
<INVESTMENTS-AT-VALUE> 3,021,771,573
<RECEIVABLES> 6,319,006
<ASSETS-OTHER> 140,163
<OTHER-ITEMS-ASSETS> 35,130
<TOTAL-ASSETS> 3,028,265,782
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 14,542,205
<TOTAL-LIABILITIES> 14,542,205
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,013,687,919
<SHARES-COMMON-STOCK> 638,279,282
<SHARES-COMMON-PRIOR> 536,903,385
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 35,748
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 3,013,723,667
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 78,310,881
<OTHER-INCOME> 0
<EXPENSES-NET> (3,859,518)
<NET-INVESTMENT-INCOME> 74,451,363
<REALIZED-GAINS-CURRENT> 174,705
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 74,626,068
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (14,710,547)
<DISTRIBUTIONS-OF-GAINS> (45,320)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,939,119,896
<NUMBER-OF-SHARES-REDEEMED> (1,842,433,066)
<SHARES-REINVESTED> 4,689,067
<NET-CHANGE-IN-ASSETS> (81,419,266)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 80,038
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2,940,015
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,711,744
<AVERAGE-NET-ASSETS> 2,892,078,072
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 37
<NAME> FINANCIAL SQUARE TREASURY OBLIGATIONS FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 3,021,771,573
<INVESTMENTS-AT-VALUE> 3,021,771,573
<RECEIVABLES> 6,319,006
<ASSETS-OTHER> 140,163
<OTHER-ITEMS-ASSETS> 35,130
<TOTAL-ASSETS> 3,028,265,872
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 14,542,205
<TOTAL-LIABILITIES> 14,542,205
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 3,013,687,919
<SHARES-COMMON-STOCK> 232,544,927
<SHARES-COMMON-PRIOR> 220,555,465
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 35,748
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 3,013,723,667
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 78,310,881
<OTHER-INCOME> 0
<EXPENSES-NET> (3,859,518)
<NET-INVESTMENT-INCOME> 74,451,363
<REALIZED-GAINS-CURRENT> 174,705
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 74,626,068
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,136,873)
<DISTRIBUTIONS-OF-GAINS> (16,837)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,367,481,225
<NUMBER-OF-SHARES-REDEEMED> (1,359,611,377)
<SHARES-REINVESTED> 4,119,614
<NET-CHANGE-IN-ASSETS> (81,419,266)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 80,038
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2,940,015
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,711,744
<AVERAGE-NET-ASSETS> 2,892,078,072
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 38
<NAME> FINANCIAL SQUARE TREASURY INSTRUMENTS FUND-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 272,328,879
<INVESTMENTS-AT-VALUE> 272,328,879
<RECEIVABLES> 3,205,591
<ASSETS-OTHER> 26,802
<OTHER-ITEMS-ASSETS> 84,333
<TOTAL-ASSETS> 275,645,605
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,166,612
<TOTAL-LIABILITIES> 1,166,612
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 274,466,741
<SHARES-COMMON-STOCK> 237,434,466
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,252
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 274,478,993
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,909,008
<OTHER-INCOME> 0
<EXPENSES-NET> (180,598)
<NET-INVESTMENT-INCOME> 3,728,410
<REALIZED-GAINS-CURRENT> 51,826
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 3,780,236
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (3,268,016)
<DISTRIBUTIONS-OF-GAINS> (34,205)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 640,129,197
<NUMBER-OF-SHARES-REDEEMED> (403,398,269)
<SHARES-REINVESTED> 703,538
<NET-CHANGE-IN-ASSETS> 274,478,993
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 151,180
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 315,063
<AVERAGE-NET-ASSETS> 224,311,332
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.017
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.017)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 38
<NAME> FINANCIAL SQUARE TREASURY INSTRUMENTS FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 272,328,879
<INVESTMENTS-AT-VALUE> 272,328,879
<RECEIVABLES> 3,205,591
<ASSETS-OTHER> 26,802
<OTHER-ITEMS-ASSETS> 84,333
<TOTAL-ASSETS> 275,645,605
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,166,612
<TOTAL-LIABILITIES> 1,166,612
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 274,466,741
<SHARES-COMMON-STOCK> 1,500
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,252
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 274,478,993
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,909,008
<OTHER-INCOME> 0
<EXPENSES-NET> (180,598)
<NET-INVESTMENT-INCOME> 3,728,410
<REALIZED-GAINS-CURRENT> 51,826
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 3,780,236
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (7)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,500
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 274,478,993
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 151,180
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 315,063
<AVERAGE-NET-ASSETS> 224,311,332
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.004
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.005)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 38
<NAME> FINANCIAL SQUARE TREASURY INSTRUMENTS FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 272,328,879
<INVESTMENTS-AT-VALUE> 272,328,879
<RECEIVABLES> 3,205,591
<ASSETS-OTHER> 26,802
<OTHER-ITEMS-ASSETS> 84,333
<TOTAL-ASSETS> 275,645,605
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,166,612
<TOTAL-LIABILITIES> 1,166,612
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 274,466,741
<SHARES-COMMON-STOCK> 1,131,506
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,252
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 274,478,993
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,909,008
<OTHER-INCOME> 0
<EXPENSES-NET> (180,598)
<NET-INVESTMENT-INCOME> 3,728,410
<REALIZED-GAINS-CURRENT> 51,826
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 3,780,236
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (15,122)
<DISTRIBUTIONS-OF-GAINS> (195)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2,856,365
<NUMBER-OF-SHARES-REDEEMED> (1,729,324)
<SHARES-REINVESTED> 4,465
<NET-CHANGE-IN-ASSETS> 274,478,993
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 151,180
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 315,063
<AVERAGE-NET-ASSETS> 224,311,332
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.012
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.012)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 38
<NAME> FINANCIAL SQUARE TREASURY INSTRUMENTS FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 272,328,879
<INVESTMENTS-AT-VALUE> 272,328,879
<RECEIVABLES> 3,205,591
<ASSETS-OTHER> 26,802
<OTHER-ITEMS-ASSETS> 84,333
<TOTAL-ASSETS> 275,645,605
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,166,612
<TOTAL-LIABILITIES> 1,166,612
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 274,466,741
<SHARES-COMMON-STOCK> 35,899,269
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 12,252
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 274,478,993
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,909,008
<OTHER-INCOME> 0
<EXPENSES-NET> (180,598)
<NET-INVESTMENT-INCOME> 3,728,410
<REALIZED-GAINS-CURRENT> 51,826
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 3,780,236
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (445,265)
<DISTRIBUTIONS-OF-GAINS> (5,174)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 99,401,661
<NUMBER-OF-SHARES-REDEEMED> (63,502,392)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 274,478,993
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 151,180
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 315,063
<AVERAGE-NET-ASSETS> 224,311,332
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 39
<NAME> FINANCIAL SQUARE FEDERAL FUND-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,042,228,217
<INVESTMENTS-AT-VALUE> 1,042,228,217
<RECEIVABLES> 1,536,865
<ASSETS-OTHER> 75,617
<OTHER-ITEMS-ASSETS> 24,734
<TOTAL-ASSETS> 1,043,865,433
<PAYABLE-FOR-SECURITIES> 64,943,073
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,640,497
<TOTAL-LIABILITIES> 69,583,570
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 974,281,863
<SHARES-COMMON-STOCK> 714,024,245
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 2,859
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (2,859)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 974,281,863
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 12,455,299
<OTHER-INCOME> 0
<EXPENSES-NET> (520,168)
<NET-INVESTMENT-INCOME> 11,935,131
<REALIZED-GAINS-CURRENT> (2,859)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,932,272
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (10,204,220)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,573,533,976
<NUMBER-OF-SHARES-REDEEMED> (862,094,664)
<SHARES-REINVESTED> 2,584,933
<NET-CHANGE-IN-ASSETS> 974,281,863
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 460,458
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 926,326
<AVERAGE-NET-ASSETS> 666,536,818
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.018
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.018)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
MONEY MARKET TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 39
<NAME> FINANCIAL SQUARE FEDERAL FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,042,228,217
<INVESTMENTS-AT-VALUE> 1,042,228,217
<RECEIVABLES> 1,536,865
<ASSETS-OTHER> 75,617
<OTHER-ITEMS-ASSETS> 24,734
<TOTAL-ASSETS> 1,043,865,433
<PAYABLE-FOR-SECURITIES> 64,943,073
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,640,497
<TOTAL-LIABILITIES> 69,583,570
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 974,281,863
<SHARES-COMMON-STOCK> 1,501
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 2,859
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (2,859)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 974,281,863
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 12,455,299
<OTHER-INCOME> 0
<EXPENSES-NET> (520,168)
<NET-INVESTMENT-INCOME> 11,935,131
<REALIZED-GAINS-CURRENT> (2,859)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,932,272
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (7)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,500
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 1
<NET-CHANGE-IN-ASSETS> 974,281,863
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 460,458
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 926,326
<AVERAGE-NET-ASSETS> 666,536,818
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.005
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.005)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 39
<NAME> FINANCIAL SQUARE FEDERAL FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,042,228,217
<INVESTMENTS-AT-VALUE> 1,042,228,217
<RECEIVABLES> 1,536,865
<ASSETS-OTHER> 75,617
<OTHER-ITEMS-ASSETS> 24,734
<TOTAL-ASSETS> 1,043,865,433
<PAYABLE-FOR-SECURITIES> 64,943,073
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,640,497
<TOTAL-LIABILITIES> 69,583,570
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 974,281,863
<SHARES-COMMON-STOCK> 137,933,257
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 2,859
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (2,859)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 974,281,863
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 12,455,299
<OTHER-INCOME> 0
<EXPENSES-NET> (520,168)
<NET-INVESTMENT-INCOME> 11,935,131
<REALIZED-GAINS-CURRENT> (2,859)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,932,272
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (973,290)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 231,075,379
<NUMBER-OF-SHARES-REDEEMED> (93,301,034)
<SHARES-REINVESTED> 158,912
<NET-CHANGE-IN-ASSETS> 974,281,863
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 460,458
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 926,326
<AVERAGE-NET-ASSETS> 666,536,818
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.013
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.013)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 39
<NAME> FINANCIAL SQUARE FEDERAL FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 1,042,228,217
<INVESTMENTS-AT-VALUE> 1,042,228,217
<RECEIVABLES> 1,536,865
<ASSETS-OTHER> 75,617
<OTHER-ITEMS-ASSETS> 24,734
<TOTAL-ASSETS> 1,043,865,433
<PAYABLE-FOR-SECURITIES> 64,943,073
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4,640,497
<TOTAL-LIABILITIES> 69,583,570
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 974,281,863
<SHARES-COMMON-STOCK> 122,322,860
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 2,859
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (2,859)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 974,281,863
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 12,455,299
<OTHER-INCOME> 0
<EXPENSES-NET> (520,168)
<NET-INVESTMENT-INCOME> 11,935,131
<REALIZED-GAINS-CURRENT> (2,859)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,932,272
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (754,755)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 382,628,548
<NUMBER-OF-SHARES-REDEEMED> (260,661,272)
<SHARES-REINVESTED> 355,584
<NET-CHANGE-IN-ASSETS> 974,281,863
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 460,458
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 926,326
<AVERAGE-NET-ASSETS> 666,536,818
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.013
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.013)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 40
<NAME> FINANCIAL SQUARE GOVERNMENT FUND-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,170,063,437
<INVESTMENTS-AT-VALUE> 2,170,063,437
<RECEIVABLES> 6,340,836
<ASSETS-OTHER> 7,144
<OTHER-ITEMS-ASSETS> 66,012
<TOTAL-ASSETS> 2,176,477,429
<PAYABLE-FOR-SECURITIES> 99,936,750
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 10,945,707
<TOTAL-LIABILITIES> 110,882,457
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,065,599,431
<SHARES-COMMON-STOCK> 1,222,438,256
<SHARES-COMMON-PRIOR> 858,743,905
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (4,459)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,065,594,972
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 52,696,383
<OTHER-INCOME> 0
<EXPENSES-NET> (3,210,794)
<NET-INVESTMENT-INCOME> 49,485,589
<REALIZED-GAINS-CURRENT> 127,727
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 49,613,316
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (31,359,341)
<DISTRIBUTIONS-OF-GAINS> (95,927)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6,726,062,143
<NUMBER-OF-SHARES-REDEEMED> (6,370,744,629)
<SHARES-REINVESTED> 8,376,837
<NET-CHANGE-IN-ASSETS> 838,052,083
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 26,484
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,960,199
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,590,005
<AVERAGE-NET-ASSETS> 1,928,238,366
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.027)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 40
<NAME> FINANCIAL SQUARE GOVERNMENT FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,170,063,437
<INVESTMENTS-AT-VALUE> 2,170,063,437
<RECEIVABLES> 6,340,836
<ASSETS-OTHER> 7,144
<OTHER-ITEMS-ASSETS> 66,012
<TOTAL-ASSETS> 2,176,477,429
<PAYABLE-FOR-SECURITIES> 99,936,750
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 10,945,707
<TOTAL-LIABILITIES> 110,882,457
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,065,599,431
<SHARES-COMMON-STOCK> 48,896,830
<SHARES-COMMON-PRIOR> 112,430
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (4,459)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,065,594,972
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 52,696,383
<OTHER-INCOME> 0
<EXPENSES-NET> (3,210,794)
<NET-INVESTMENT-INCOME> 49,485,589
<REALIZED-GAINS-CURRENT> 127,727
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 49,613,316
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (482,455)
<DISTRIBUTIONS-OF-GAINS> (1,268)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 91,625,116
<NUMBER-OF-SHARES-REDEEMED> (42,882,176)
<SHARES-REINVESTED> 41,460
<NET-CHANGE-IN-ASSETS> 838,052,083
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 26,484
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,960,199
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,590,005
<AVERAGE-NET-ASSETS> 1,928,238,366
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.026
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.026)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 40
<NAME> FINANCIAL SQUARE GOVERNMENT FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,170,063,437
<INVESTMENTS-AT-VALUE> 2,170,063,437
<RECEIVABLES> 6,340,836
<ASSETS-OTHER> 7,144
<OTHER-ITEMS-ASSETS> 66,012
<TOTAL-ASSETS> 2,176,477,429
<PAYABLE-FOR-SECURITIES> 99,936,750
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 10,945,707
<TOTAL-LIABILITIES> 110,882,457
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,065,599,431
<SHARES-COMMON-STOCK> 190,743,421
<SHARES-COMMON-PRIOR> 145,103,169
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (4,459)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,065,594,972
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 52,696,383
<OTHER-INCOME> 0
<EXPENSES-NET> (3,210,794)
<NET-INVESTMENT-INCOME> 49,485,589
<REALIZED-GAINS-CURRENT> 127,727
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 49,613,316
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (6,376,770)
<DISTRIBUTIONS-OF-GAINS> (20,586)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 953,075,246
<NUMBER-OF-SHARES-REDEEMED> (908,619,456)
<SHARES-REINVESTED> 1,184,462
<NET-CHANGE-IN-ASSETS> 838,052,083
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 26,484
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,960,199
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,590,005
<AVERAGE-NET-ASSETS> 1,928,238,366
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.025
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.025)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 40
<NAME> FINANCIAL SQUARE GOVERNMENT FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 2,170,063,437
<INVESTMENTS-AT-VALUE> 2,170,063,437
<RECEIVABLES> 6,340,836
<ASSETS-OTHER> 7,144
<OTHER-ITEMS-ASSETS> 66,012
<TOTAL-ASSETS> 2,176,477,429
<PAYABLE-FOR-SECURITIES> 99,936,750
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 10,945,707
<TOTAL-LIABILITIES> 110,882,457
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,065,599,431
<SHARES-COMMON-STOCK> 603,520,924
<SHARES-COMMON-PRIOR> 223,556,901
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (4,459)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 2,065,594,972
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 52,696,383
<OTHER-INCOME> 0
<EXPENSES-NET> (3,210,794)
<NET-INVESTMENT-INCOME> 49,485,589
<REALIZED-GAINS-CURRENT> 127,727
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 49,613,316
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (11,267,023)
<DISTRIBUTIONS-OF-GAINS> (40,889)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,245,925,804
<NUMBER-OF-SHARES-REDEEMED> (866,901,073)
<SHARES-REINVESTED> 939,292
<NET-CHANGE-IN-ASSETS> 838,052,083
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 26,484
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,960,199
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3,590,005
<AVERAGE-NET-ASSETS> 1,928,238,366
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.024
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.024)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 41
<NAME> FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND-INSTITUTIONAL
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 857,724,204
<INVESTMENTS-AT-VALUE> 857,724,204
<RECEIVABLES> 5,824,393
<ASSETS-OTHER> 3,273
<OTHER-ITEMS-ASSETS> 532,140
<TOTAL-ASSETS> 864,084,010
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,739,542
<TOTAL-LIABILITIES> 2,739,542
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 861,358,000
<SHARES-COMMON-STOCK> 731,787,339
<SHARES-COMMON-PRIOR> 440,850,118
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (13,532)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 861,344,468
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 13,377,712
<OTHER-INCOME> 0
<EXPENSES-NET> (820,993)
<NET-INVESTMENT-INCOME> 12,556,719
<REALIZED-GAINS-CURRENT> (673)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 12,556,046
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (10,760,679)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2,882,561,349
<NUMBER-OF-SHARES-REDEEMED> (2,594,082,121)
<SHARES-REINVESTED> 2,457,993
<NET-CHANGE-IN-ASSETS> 320,259,410
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (12,859)
<GROSS-ADVISORY-FEES> 752,437
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 964,972
<AVERAGE-NET-ASSETS> 740,167,616
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.017
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.017)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.18
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 41
<NAME> FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND-PREFERRED
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 857,724,204
<INVESTMENTS-AT-VALUE> 857,724,204
<RECEIVABLES> 5,824,393
<ASSETS-OTHER> 3,273
<OTHER-ITEMS-ASSETS> 532,140
<TOTAL-ASSETS> 864,084,010
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,739,542
<TOTAL-LIABILITIES> 2,739,542
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 861,358,000
<SHARES-COMMON-STOCK> 5,469,429
<SHARES-COMMON-PRIOR> 28,730,558
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (131,532)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 861,344,468
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 13,377,712
<OTHER-INCOME> 0
<EXPENSES-NET> (820,993)
<NET-INVESTMENT-INCOME> 12,556,719
<REALIZED-GAINS-CURRENT> (673)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 12,556,046
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (165,047)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 49,262,422
<NUMBER-OF-SHARES-REDEEMED> (72,600,418)
<SHARES-REINVESTED> 76,867
<NET-CHANGE-IN-ASSETS> 320,259,410
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (12,859)
<GROSS-ADVISORY-FEES> 752,437
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 964,972
<AVERAGE-NET-ASSETS> 740,167,616
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.017
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.017)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.28
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 41
<NAME> FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND-ADMINISTRATION
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 857,724,204
<INVESTMENTS-AT-VALUE> 857,724,204
<RECEIVABLES> 5,824,393
<ASSETS-OTHER> 3,273
<OTHER-ITEMS-ASSETS> 532,140
<TOTAL-ASSETS> 864,084,010
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,739,542
<TOTAL-LIABILITIES> 2,739,542
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 861,358,000
<SHARES-COMMON-STOCK> 96,498,886
<SHARES-COMMON-PRIOR> 51,661,795
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (13,532)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 861,344,468
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 13,377,712
<OTHER-INCOME> 0
<EXPENSES-NET> (820,993)
<NET-INVESTMENT-INCOME> 12,556,719
<REALIZED-GAINS-CURRENT> (673)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 12,556,046
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,312,189)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 126,938,261
<NUMBER-OF-SHARES-REDEEMED> (82,481,110)
<SHARES-REINVESTED> 379,940
<NET-CHANGE-IN-ASSETS> 320,259,410
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (12,859)
<GROSS-ADVISORY-FEES> 752,437
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 964,972
<AVERAGE-NET-ASSETS> 740,167,616
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.016
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.016)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
GOLDMAN SACHS TRUST'S SEMI-ANNUAL STATEMENT ON BEHALF OF THE MONEY
MARKET FUNDS DATED JUNE 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 41
<NAME> FINANCIAL SQUARE TAX-FREE MONEY MARKET FUND-SERVICE
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 857,724,204
<INVESTMENTS-AT-VALUE> 857,724,204
<RECEIVABLES> 5,824,393
<ASSETS-OTHER> 3,273
<OTHER-ITEMS-ASSETS> 532,140
<TOTAL-ASSETS> 864,084,010
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,739,542
<TOTAL-LIABILITIES> 2,739,542
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 861,358,000
<SHARES-COMMON-STOCK> 27,602,346
<SHARES-COMMON-PRIOR> 19,855,446
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (13,532)
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 861,344,468
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 13,377,712
<OTHER-INCOME> 0
<EXPENSES-NET> (820,993)
<NET-INVESTMENT-INCOME> 12,556,719
<REALIZED-GAINS-CURRENT> (673)
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 12,556,046
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (318,804)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 120,944,834
<NUMBER-OF-SHARES-REDEEMED> (113,454,846)
<SHARES-REINVESTED> 256,912
<NET-CHANGE-IN-ASSETS> 320,259,410
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> (12,859)
<GROSS-ADVISORY-FEES> 752,437
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 964,972
<AVERAGE-NET-ASSETS> 740,167,616
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.015
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (0.015)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.68
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
