<PAGE>
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- --------------------------------------------------------------------------------
Goldman Sachs Trust
Financial Square Funds
. Prime Obligations Fund
. Money Market Fund
. Premium Money Market Fund
. Treasury Obligations Fund
. Treasury Instruments Fund
. Government Fund
. Federal Fund
. Tax-Free Money Market Fund
ANNUAL REPORT [LOGO] Goldman
December 31, 1998 Sachs
<PAGE>
- --------------------------------------------------------------------------------
Letter to Shareholders
- --------------------------------------- ---------------------------------------
Dear Shareholders:
We welcome this opportunity to provide you with a summary of the trends and
key events that affected the economy and the Goldman Sachs Money Market
Trust/Financial Square Funds in 1998. It was another strong year for the funds,
during which all of them outperformed their respective IBC Financial Data, Inc.
averages. Net assets in the Financial Square Funds totaled $27.5 billion as of
December 31, 1998.
The Economy In Review
Despite a slight tempering due to soft employment numbers, the U.S. economy
continued to see strong growth for most of 1998. This growth, combined with
continued uncertainty about the impact of Asian instability on the U.S.
economy, kept the Federal Reserve in a wait-and-see mode for the first nine
months of the year.
On September 29th, in the wake of increasing global market turmoil, the
Federal Reserve Board cut the federal fund's target rate by 25 basis points, to
5.25%. As increasing illiquidity concerns in the market became more severe, the
Fed followed up with two more surprise rate cuts, easing the target rate and
the discount rate by another 50 basis points.
The Fed's moves were a strong signal that the monetary authorities were
prepared to do whatever was necessary to provide liquidity and to support the
economy against the potential of a substantial economic slowdown in 1999.
At period end, while consumer spending remained strong, the manufacturing
side of the economy appeared to weaken because of a trade drag and a slowdown
in capital spending. However, based on signs of non-inflationary growth in the
areas of consumer spending, new home sales and strong third quarter gross
domestic product (GDP), the general consensus is that any further easing by the
Fed will come later, rather than sooner.
Credit Year 1998: A Year of Crisis With a Hopeful Ending
Domestic credit quality continued its strong positive trend for the first six
months of 1998. Mergers and acquisitions were at an all time high. U.S. banks
remained strong, well capitalized and provisioned, with diversified operations.
The stock market continued its climb and American consumers were spending more
than they were earning. The shocks of the Russian default in August and the
near collapse of Long Term Capital Management (LTCM) caused severe liquidity
problems and a difficult trading environment, as well as a major sell-off in
the stock market. Calm was restored by the rescue of LTCM and the Fed's
lowering of interest rates three times in seven weeks. A newly risk averse
investor moved funds to safer, more liquid credits. The enthusiasm for
globalization was temporarily curbed, as domestic production was suppressed in
response to the Asian crisis and corporate profit gains for the year were
generally mixed.
The international credit environment in 1998 saw the Asian situation explode
into a full-blown global crisis that adversely affected markets around the
world. The default and devaluation of Russia in August came after an already
painful several months of recession and restructuring in Asia. This pain was
exacerbated by Japan's continued slow economic deterioration, which cast a
shadow over the entire region. The unprecedented market volatility that
followed Russia's default took months to dissipate, and only after a more
committed response by the U.S. government to the crisis. By the end of the
year, however, trends were much more positive. The reforming Asian economies
showed notable progress, with signs of a return to economic growth in 1999.
More significant, however, was the successful launch of the euro. Ongoing
policy convergence and political resolution served to create the world's first
regional currency with nary a ripple in the markets. In fact, with the U.S.
economy seemingly impervious to difficulties elsewhere, global markets quickly
rebounded to close the year on a decidedly positive note.
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1
<PAGE>
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- --------------------------------------- ---------------------------------------
Although the U.S. economy remains favorable, the challenges of global
volatility continue to concern us. The Goldman Sachs Credit Department, with
analysts based in London, Tokyo, Frankfurt and New York, as well as extensive
technological assets and credit expertise, will continue to anticipate and
monitor global developments and apply its conservative credit standards to the
money market portfolios.
Strategy
Taxable. For most of the period, a "flight to quality" resulting from the
ongoing Asian economic crisis rendered the short end of the yield curve
expensive. In view of this, the Funds maintained a neutral stance by buying on
market dips and "aging in" when levels got expensive. However, we extended the
weighted average maturity (WAM) ranges from neutral to slightly long as the Fed
began its series of easings in late September in response to market liquidity.
We continued to maintain a barbell structure by holding significant liquidity
in anticipation of year-end outflows, and targeted longer dated maturities to
enhance performance in a declining rate environment.
Tax-Exempt. Early in the period, given the fact that we no longer foresaw a
near-term Fed easing and in preparation for the seasonally short supply of
municipal issuance in January, we increased the funds' WAMs to the 40- to 50-
day range. This decision helped keep the funds' yields competitive during this
period of high cash inflows and high demand for municipal securities. In March,
we shortened the WAMs of the funds to the 30- to 35-day range, seeking to build
liquidity as the April 15th tax deadline approached. This move helped us to
fund tax-time redemptions. In August, when seasonal issuance was strong and
there was less demand in the tax-exempt market in contrast to the "flight to
quality" in the Treasury market, we extended the funds' WAMs to the 40-day
range.
At period end, after a brief period during which the funds' WAMs were brought
into a neutral range, we extended the WAMs in anticipation of technically
driven lower yields (due to inflows from the reinvestment of maturity proceeds,
coupled with a seasonal scarcity of issuance).
Summary for Financial Square Funds Institutional Shares* as of 12/31/98
<TABLE>
<CAPTION>
SEC SEC 1-Mo.
7-Day 7-Day Simple Weighted Avg.
Financial Square Current Effective Average Maturity
Funds Yield Yield Yield (days)
---------------- ------- --------- ------- -------------
<S> <C> <C> <C> <C>
Prime
Obligations.... 5.09% 5.22% 5.04% 39
Money Market.... 5.09 5.22 5.04 51
Premium Money Market.. 5.08 5.21 5.05 31
Treasury
Obligations.... 4.77 4.82 4.74 43
Treasury
Instruments.... 4.26 4.33 4.26 31
Government...... 5.01 5.13 4.92 46
Federal......... 4.97 5.09 4.95 46
Tax-Free Money Market.. 3.51 3.58 3.12 45
</TABLE>
*Financial Square Funds offer four separate classes of shares (Institutional,
Preferred, Administration and Service), each of which is subject to different
fees and expenses that affect performance and entitle shareholders to different
services. The Preferred, Administration and Service shares offer financial
institutions the opportunity to receive a fee for providing administrative
support services. The Preferred shares pay 0.10%, Administration shares pay
0.25%, and the Service shares pay 0.50%. If these fees were reflected in the
above performance, performance would be reduced. Past performance is no
guarantee of future results. Yields will vary. An investment in any one of the
Financial Square Funds is neither insured nor guaranteed by the U.S. Government
nor is there any assurance that the Funds will be able to maintain a stable net
asset value of $1.00 per share. More complete information, including management
fees and expenses, is included in the funds' prospectus or may be obtained by
calling Goldman Sachs Funds at 1-800-621-2550.
Outlook and Strategies for 1999
With the financing pressure of year-end behind institutional investors, we
are looking to extend the funds' weighted average maturities somewhat as we see
opportunities on the yield curve. While there are a
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2
<PAGE>
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Letter to Shareholders (continued)
- --------------------------------------- ---------------------------------------
variety of opinions as to when the Fed will move, based on current signs of
non-inflationary growth in areas of consumer spending, new home sales and
fourth quarter GDP, most economists anticipate that easing will come later
rather than sooner. Goldman Sachs economists' 1999 outlook anticipates a 50
basis point cumulative ease in the second half of the year.
In closing, we thank you for your support and for making 1998 a year of
record assets for the Financial Square money market funds. As in the past, we
will continue to look for additional ways to improve our services, while
seeking to provide you with competitive performance. We welcome your
suggestions and questions, and look forward to another productive year in 1999.
Goldman Sachs Money Market Management Team
January 29, 1999
- --------------------------------------- ---------------------------------------
3
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Prime Obligations Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Commercial Paper and Corporate Obligations--39.3%
Agricultural Services
Cargill, Inc.
$ 25,000,000 5.04% 04/14/99 $ 24,639,500
Bank Holding Companies
BankAmerica Corp.
50,000,000 5.16 01/15/99 49,899,667
40,000,000 5.17 01/22/99 39,879,367
50,000,000 5.12 01/25/99 49,829,333
25,000,000 5.04 05/12/99 24,541,500
Business Credit Institutions
CIT Group Holdings, Inc.
50,000,000 5.05 03/30/99 49,382,778
17,000,000 6.38 05/21/99 17,077,237
Ford Motor Credit Corp.
17,500,000 5.37 02/19/99 17,372,090
100,000,000 4.90 05/24/99 98,054,803
General Electric Capital Corp.
75,000,000 5.36 02/16/99 74,486,333
100,000,000 5.35 03/09/99 99,004,306
10,000,000 4.94 04/23/99 9,846,311
Commercial Banks
CP Trust Certificates Series 1996-1
72,250,000 4.95 03/30/99 72,250,000
Consumer Products
Eastman Kodak Corp.
25,000,000 5.20 02/01/99 24,888,056
25,000,000 5.20 02/03/99 24,880,833
25,000,000 5.20 02/04/99 24,877,222
25,000,000 5.20 02/05/99 24,873,611
Information Management
First Data Corp.
25,000,000 5.37 02/02/99 24,880,667
Receivable/Asset Financing
Asset Portfolio Funding
75,000,000 5.01 02/23/99 74,446,813
48,302,000 5.20 05/13/99 47,381,042
Ciesco, Inc.
100,000,000 5.30 02/05/99 99,484,722
Corporate Receivables Corp.
85,000,000 5.22 01/13/99 84,852,100
40,000,000 5.50 01/12/99 39,932,778
Dakota Certificates of Standard Credit Card Master Trust
80,000,000 5.25 01/14/99 79,848,333
25,000,000 5.25 01/20/99 24,930,729
50,000,000 5.27 02/17/99 49,655,986
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Commercial Paper and Corporate Obligations (continued)
Receivable/Asset Financing (continued)
Dakota Certificates of Standard Credit Card Master Trust (continued)
$ 25,000,000 5.30% 02/17/99 $ 24,827,014
25,000,000 5.22 03/04/99 24,775,250
Delaware Funding Corp.
75,000,000 5.30 01/13/99 74,867,500
23,805,000 5.15 01/15/99 23,757,324
Edison Asset Securitization Corp.
25,000,000 5.13 01/29/99 24,900,250
28,969,000 5.33 02/12/99 28,788,861
100,000,000 5.14 02/26/99 99,200,443
35,000,000 5.19 03/12/99 34,646,792
25,000,000 4.90 03/30/99 24,700,556
25,000,000 5.10 04/30/99 24,578,542
Falcon Asset Securitization Corp.
40,000,000 5.15 01/15/99 39,919,889
25,000,000 5.15 01/20/99 24,932,049
28,935,000 5.29 02/04/99 28,790,438
17,650,000 5.25 02/09/99 17,549,616
66,925,000 5.11 03/22/99 66,165,029
International Securitization Corp.
12,310,000 5.13 03/12/99 12,187,208
Park Avenue Receivables Corp.
16,539,000 5.75 01/22/99 16,483,525
Prudential Financing Corp.
30,000,000 5.39 01/25/99 29,892,200
Receivables Capital Corp.
26,178,000 5.50 01/04/99 26,166,002
50,153,000 5.15 01/21/99 50,009,507
Riverwoods Funding Corp.
50,000,000 5.05 02/25/99 49,614,236
Variable Funding Capital Corp.
25,000,000 5.21 01/05/99 24,985,528
25,000,000 5.26 01/22/99 24,923,292
WCP Funding Corp.
75,000,000 5.53 01/15/99 74,838,708
21,694,000 5.40 01/27/99 21,609,393
50,000,000 5.27 02/17/99 49,655,986
Security and Commodity Brokers, Dealers and Services
J.P. Morgan Securities, Inc.
60,000,000 5.12 01/19/99 59,846,400
30,000,000 5.08 02/26/99 29,762,933
50,000,000 5.75 03/10/99 50,000,000
Morgan Stanley Dean Witter & Co.
60,000,000 5.38 02/19/99 59,560,633
25,000,000 5.35 02/23/99 24,803,090
10,000,000 5.20 03/24/99 9,881,556
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
4
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Prime Obligations Fund (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
Commercial Paper and Corporate Obligations (continued)
Security and Commodity Brokers, Dealers and Services (continued)
Salomon Smith Barney Holdings, Inc.
$ 50,000,000 5.40% 01/12/99 $ 49,917,500
30,000,000 5.40 01/19/99 29,919,000
50,000,000 5.40 02/23/99 49,602,500
50,000,000 5.20 03/12/99 49,494,444
- ------------------------------------------------------------------------------------------------
Total Commercial Paper and Corporate Obligations $2,606,749,311
- ------------------------------------------------------------------------------------------------
Bank Notes--6.4%
BankBoston, N.A.
$ 40,000,000 5.20% 04/01/99 $ 40,000,000
50,000,000 5.74 04/15/99 49,994,542
20,000,000 5.15 05/04/99 20,000,000
First Tennessee Bank, N.A.
40,000,000 5.65 03/02/99 39,996,844
50,000,000 5.82 04/30/99 49,990,641
First Union National Bank
75,000,000 5.12 03/29/99 75,000,000
50,000,000 5.06 05/19/99 50,000,000
NationsBank Corp.
25,000,000 4.96 11/18/99 24,995,756
Norwest Financial
11,000,000 6.68 09/15/99 11,113,844
PNC Bank, N.A.
35,000,000 5.71 04/26/99 34,993,664
Wachovia Bank
25,000,000 4.98 05/25/99 25,000,000
- ------------------------------------------------------------------------------------------------
Total Bank Notes $ 421,085,291
- ------------------------------------------------------------------------------------------------
Certificates of Deposit--7.6%
American Express Centurion Bank
$ 50,000,000 5.26% 01/12/99 $ 50,000,000
Bank of America NT & SA
55,250,000 5.63 02/26/99 55,245,125
Chase Manhattan Bank
100,000,000 5.06 05/12/99 100,007,399
Crestar Bank
100,000,000 5.42 01/07/99 100,000,000
Mellon Bank, N.A.
100,000,000 5.00 02/17/99 100,000,000
Old Kent Bank & Trust Co.
100,000,000 5.06 05/10/99 100,000,000
- ------------------------------------------------------------------------------------------------
Total Certificates of Deposit $ 505,252,524
- ------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Taxable Municipal Notes--0.2%
Ocean Spray Cranberries, Inc.
$ 15,000,000 5.63% 01/07/99 $ 15,000,000
- -----------------------------------------------------------------------------------------------
Total Taxable Municipal Notes $ 15,000,000
- -----------------------------------------------------------------------------------------------
Variable Rate Obligations(a)--32.2%
Allmerica Funding
$ 25,000,000 5.45% 02/08/99 $ 25,000,000
American Express Centurion Bank
50,000,000 5.52 01/25/99 50,000,000
Bank One, N.A.
160,000,000 5.49 01/04/99 159,976,463
Caterpillar Financial Services Corp.
50,000,000 5.62 01/26/99 50,005,314
Comerica Bank Detroit
50,000,000 5.42 01/19/99 49,983,898
150,000,000 5.11 03/10/99 149,954,840
First National Bank of Chicago
40,000,000 5.48 01/04/99 39,987,720
40,000,000 5.42 01/14/99 39,987,244
First Tennessee Bank, N.A.
30,000,000 5.07 01/25/99 29,995,489
First Union Corp.
40,000,000 5.52 01/25/99 40,000,000
25,000,000 5.57 01/28/99 25,000,000
First U.S.A. Bank
10,000,000 5.62 01/20/99 10,029,496
15,000,000 5.52 02/01/99 15,004,382
General Electric Capital Corp.
20,000,000 5.32 02/17/99 20,000,000
45,000,000 5.18 03/08/99 45,000,000
General Motors Acceptance Corp.
25,000,000 5.36 03/01/99 25,007,694
IBM Corp.
50,000,000 5.23 02/12/99 49,968,362
J.P. Morgan Securities, Inc.
30,000,000 5.21 01/04/99 29,997,732
50,000,000 5.48 01/07/99 49,985,055
Keybank, N.A.
100,000,000 5.13 02/22/99 99,992,398
10,000,000 5.18 02/22/99 9,994,987
Merrill Lynch & Co., Inc.
35,000,000 5.58 01/12/99 35,000,000
40,000,000 5.48 01/13/99 39,997,545
25,000,000 5.57 01/25/99 25,000,000
28,250,000 5.47 01/29/99 28,277,808
25,000,000 5.57 01/29/99 25,000,000
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
5
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
Variable Rate Obligations (continued)
Merrill Lynch & Co., Inc. (continued)
$ 30,000,000 5.18% 03/01/99 $ 29,998,003
50,000,000 5.14 03/16/99 50,000,000
Monumental Life Insurance Co.
55,000,000 5.72 02/01/99 55,000,000
Morgan Stanley Dean Witter & Co.
80,000,000 5.58 01/19/99 80,000,000
National Rural Utilities Corp.
25,000,000 5.17 02/25/99 25,000,000
New York Life Insurance Co.
25,000,000 5.21 01/07/99 25,000,000
40,000,000 5.31 01/07/99 40,000,000
Old Kent Bank & Trust Co.
35,000,000 5.10 02/01/99 34,994,418
Pacific Mutual Life Insurance Co.
50,000,000 4.98 02/01/99 50,000,000
Pepsico Inc.
75,000,000 5.21 02/19/99 74,946,672
PNC Bank, N.A.
100,000,000 5.49 01/04/99 99,963,281
75,000,000 5.50 01/27/99 74,968,099
Seattle Washington Taxable Series 1994
25,000,000 5.58 02/01/99 25,000,000
SMM Trust Series 1998-A
35,000,000 5.32 03/16/99 35,000,000
Southtrust Bank of Alabama, N.A.
100,000,000 5.42 01/14/99 99,971,298
40,000,000 5.08 01/21/99 39,994,093
Texas State Taxable Veterans Series 1996 A
14,255,000 5.58 02/01/99 14,255,000
U.S. Bank, N.A.
50,000,000 5.50 01/08/99 49,992,464
65,000,000 5.43 01/20/99 64,982,525
- ------------------------------------------------------------------------------------------------
Total Variable Rate Obligations $2,137,212,280
- ------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------
Repurchase Agreements--14.3%
Bear Stearns Companies, Inc.(b)
$ 50,000,000 5.15% 01/04/99 $ 50,000,000
Joint Repurchase Agreement Account
201,300,000 4.82 01/04/99 201,300,000
Joint Repurchase Agreement Account II
700,000,000 4.89 01/04/99 700,000,000
- ----------------------------------------------------------------------------------------------
Total Repurchase Agreements $ 951,300,000
- ----------------------------------------------------------------------------------------------
Total Investments $6,636,599,406(c)
</TABLE>
- --------------------------------------------------------------------------------
(a) Variable rate security-base index is either U.S. Treasury Bill, LIBOR, one
month commercial paper, Federal Funds, or Prime lending rate.
(b) At December 31, 1998, this agreement was fully collateralized by Federal
Agency obligations.
(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 Money Market Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
Commercial Paper and Corporate Obligations--42.0%
Agency/Government
Province of Quebec
$ 35,000,000 5.01% 05/07/99 $ 34,386,275
Bank Holding Companies
Abbey National Treasury Services
35,000,000 4.92 02/19/99 34,765,855
ABN/AMRO Bank
35,000,000 4.89 04/30/99 34,434,254
Banca CRT Financial Corp.
10,621,000 5.41 02/08/99 10,560,348
15,000,000 5.41 02/17/99 14,894,054
20,500,000 5.40 03/01/99 20,318,575
BankAmerica Corp.
20,000,000 5.17 01/22/99 19,939,683
40,000,000 5.04 05/12/99 39,266,400
Banque Et Caisse Epargne
50,000,000 5.01 03/29/99 49,394,625
C.S. First Boston Corp.
30,000,000 5.33 02/10/99 29,822,333
70,000,000 5.02 02/23/99 69,482,661
IMI Funding Corp., U.S.A.
25,000,000 5.03 03/15/99 24,745,007
San Paolo U.S. Finance Co.
25,000,000 5.31 03/01/99 24,782,438
UBS Finance, Inc.
70,000,000 4.90 05/20/99 68,676,450
41,000,000 4.93 05/20/99 40,219,554
Business Credit Institutions
CIT Group Holdings, Inc.
30,000,000 5.05 03/29/99 29,633,875
General Electric Capital Corp.
75,000,000 5.36 02/16/99 74,489,528
Chemicals
Henkel Corp.
21,000,000 5.31 02/26/99 20,826,703
Commercial Banks
CP Trust Certificates Series 1996-1
51,000,000 4.95 03/30/99 51,000,000
CP Trust Certificates Series 1996-2
75,000,000 5.03 12/28/99 75,000,000
Mortgage Banking
Northern Rock PLC
50,000,000 5.12 02/01/99 49,779,556
5,000,000 5.12 02/02/99 4,977,244
22,214,000 5.17 03/29/99 21,936,455
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
Commercial Paper and Corporate Obligations (continued)
Northern Rock PLC (continued)
$ 35,000,000 5.00% 04/27/99 $ 34,436,111
50,000,000 4.91 05/20/99 49,053,063
50,000,000 4.93 05/27/99 49,000,306
Motor Vehicles and Equipment
DaimlerChrysler N.A. Holding Corp.
35,000,000 4.98 05/17/99 34,341,533
Receivable/Asset Financing
Asset Securitization Corp.
50,000,000 5.15 03/12/99 49,499,306
Atlantis One Funding
18,500,000 5.20 03/24/99 18,280,878
38,526,000 5.17 05/12/99 37,801,208
Beta Finance
64,500,000 5.12 03/22/99 63,766,133
Cargill Global Funding
15,000,000 5.37 02/23/99 14,881,413
CC USA, Inc.
30,000,000 5.15 01/15/99 29,939,917
15,000,000 5.40 01/27/99 14,941,500
Ciesco, Inc.
50,000,000 5.30 02/05/99 49,742,361
Corporate Receivables Corp.
100,000,000 5.25 02/18/99 99,300,000
Dakota Certificates of Standard Credit Card Master Trust
25,000,000 5.30 02/17/99 24,827,014
Delaware Funding Corp.
50,000,000 5.22 01/22/99 49,847,750
Edison Asset Securitization Corp.
40,000,000 5.15 01/13/99 39,931,333
27,060,000 5.13 01/29/99 26,952,031
100,000,000 5.14 02/26/99 99,200,443
50,000,000 5.00 03/12/99 49,513,889
15,000,000 5.19 03/12/99 14,848,625
Eureka Securities
25,000,000 5.32 01/13/99 24,955,667
Falcon Asset Securitization Corp.
25,000,000 5.25 02/09/99 24,857,813
41,540,000 5.25 02/19/99 41,243,162
Four Winds Funding
47,000,000 5.25 01/14/99 46,910,896
Rose One Plus
57,980,000 5.30 01/07/99 57,928,784
24,462,000 5.31 01/08/99 24,436,743
25,000,000 5.30 01/19/99 24,933,750
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
7
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Commercial Paper and Corporate Obligations (continued)
Receivable/Asset Financing (continued)
Variable Funding Capital Corp.
$50,000,000 5.21% 01/05/99 $ 49,971,056
25,000,000 5.26 01/22/99 24,923,292
Windmill Funding
25,000,000 5.54 01/06/99 24,980,764
65,000,000 5.27 01/15/99 64,866,786
35,000,000 5.30 01/15/99 34,927,861
25,000,000 5.35 01/15/99 24,947,986
75,000,000 5.27 02/19/99 74,462,021
Security and Commodity Brokers, Dealers and Services
J.P. Morgan Securities, Inc.
45,000,000 5.75 03/10/99 45,000,000
40,000,000 5.02 04/21/99 39,386,444
Morgan Stanley Dean Witter & Co.
35,000,000 5.35 02/23/99 34,724,326
50,000,000 5.20 03/24/99 49,407,778
Salomon Smith Barney Holdings, Inc.
25,000,000 5.40 01/19/99 24,932,500
25,000,000 5.40 02/23/99 24,801,250
55,000,000 5.20 03/12/99 54,443,889
- -----------------------------------------------------------------------------------------------
Total Commercial Paper and Corporate Obligations $2,510,479,455
- -----------------------------------------------------------------------------------------------
Bank Notes--2.6%
BankBoston, N.A.
$50,000,000 5.20% 04/01/99 $ 50,000,000
30,000,000 5.11 04/05/99 30,000,000
First Union National Bank
25,000,000 5.12 03/29/99 25,000,000
NationsBank Corp.
50,000,000 4.96 11/18/99 49,991,512
- -----------------------------------------------------------------------------------------------
Total Bank Notes $ 154,991,512
- -----------------------------------------------------------------------------------------------
Certificates of Deposit--0.8%
Morgan Guaranty Trust Co.
$50,000,000 5.14% 04/19/99 $ 50,000,000
- -----------------------------------------------------------------------------------------------
Total Certificates of Deposit $ 50,000,000
- -----------------------------------------------------------------------------------------------
Certificates of Deposit--Yankeedollar--11.3%
Bank Austria, New York
$25,000,000 5.71% 06/07/99 $ 24,990,221
50,000,000 5.08 12/30/99 49,995,206
Bayerische Landesbank, New York
25,000,000 5.66 02/26/99 25,010,799
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Certificates of Deposit--Yankeedollar (continued)
CIBC Oppenheimer, New York
$100,000,000 5.01% 02/16/99 $100,000,000
Commerzbank, New York
8,000,000 5.37 02/24/99 8,001,946
19,000,000 5.41 03/11/99 19,009,284
Credit Agricole Indosuez, New York
15,000,000 5.74 04/26/99 14,997,286
Creditanstalt, New York
50,000,000 5.85 05/03/99 49,992,009
Deutsche Bank, New York
50,000,000 5.04 05/05/99 50,000,000
National Bank of Canada, New York
45,000,000 5.76 06/10/99 44,988,669
Societe Generale, New York
50,000,000 5.73 03/08/99 49,996,537
30,000,000 5.71 03/29/99 29,997,261
30,000,000 5.63 04/06/99 29,986,800
35,000,000 5.76 04/16/99 34,996,143
Toronto Dominion Bank, New York
30,100,000 4.97 05/20/99 30,090,612
25,000,000 5.10 12/29/99 25,001,195
UBS, New York
50,000,000 5.23 01/13/99 50,000,246
15,000,000 5.74 06/09/99 14,996,246
Westpac Banking Corp., New York
25,000,000 5.77 05/12/99 24,994,846
- ---------------------------------------------------------------------------------------------------
Total Certificates of Deposit--Yankeedollar $677,045,306
- ---------------------------------------------------------------------------------------------------
Taxable Municipal Notes--1.0%
Florida Housing Finance Authority
$ 27,900,000 5.50% 01/06/99 $ 27,900,000
Illinois Health & Education Facilities Authority for Elmhurst Memorial
Series 1998 B
29,400,000 5.70 01/07/99 29,400,000
- ---------------------------------------------------------------------------------------------------
Total Taxable Municipal Notes $ 57,300,000
- ---------------------------------------------------------------------------------------------------
Time Deposits--4.6%
Natexis Banque Grand Cayman(a)
$100,000,000 5.50% 01/05/99 $100,000,000
National City Bank(b)
125,000,000 4.94 01/04/99 125,000,000
Societe Generale
50,000,000 5.00 01/04/99 50,000,000
- ---------------------------------------------------------------------------------------------------
Total Time Deposit $275,000,000
- ---------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
8
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Money Market Fund (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Variable Rate Obligations(c)--38.8%
Abbey National Treasury Services
$ 25,000,000 5.38% 01/04/99 $ 24,988,785
115,000,000 5.07 01/20/99 114,948,047
Allmerica Funding
25,000,000 5.45 02/08/99 25,000,000
Banca CRT Financial Corp.
20,000,000 5.16 03/01/99 19,995,308
25,000,000 5.15 03/05/99 24,994,108
Bank of Austria, New York
50,000,000 5.49 01/04/99 49,985,444
Bank of Western Australia Ltd.
55,000,000 5.35 02/19/99 54,996,751
Barclays Bank PLC
125,000,000 5.49 01/04/99 124,960,609
25,000,000 5.49 02/01/99 24,983,399
Bayerische Landesbank
75,000,000 5.03 01/22/99 74,967,417
75,000,000 5.49 01/29/99 74,972,885
C.S. First Boston Corp.
40,000,000 5.20 01/04/99 40,000,000
40,000,000 5.57 02/01/99 40,000,000
Comerica Bank Detroit
35,000,000 5.42 01/19/99 34,988,729
Den Danske Bank Corp.
20,000,000 5.52 01/04/99 19,995,089
30,000,000 5.56 01/25/99 29,999,348
First Tennessee Bank, N.A.
30,000,000 5.07 01/25/99 29,995,489
First Union National Bank
35,000,000 5.24 01/20/99 35,000,000
25,000,000 5.57 01/28/99 25,000,000
Halifax PLC
40,000,000 5.24 03/10/99 40,010,506
Hydro Quebec
5,000,000 5.35 01/15/99 4,999,554
Istituto Bancario, New York
85,000,000 5.22 01/14/99 84,988,271
100,000,000 5.12 02/24/99 99,973,099
20,000,000 5.09 03/08/99 19,994,054
J.P. Morgan Securities, Inc.
20,000,000 5.21 01/04/99 19,998,488
75,000,000 5.48 01/07/99 74,977,583
Keybank, N.A.
35,000,000 5.13 02/22/99 34,997,339
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Variable Rate Obligations (continued)
Merrill Lynch & Co., Inc.
$ 35,000,000 5.51% 01/11/99 $ 35,000,000
50,000,000 5.51 01/19/99 50,000,000
70,000,000 5.57 01/25/99 70,000,000
25,000,000 5.57 01/29/99 25,000,000
30,000,000 5.14 03/16/99 30,000,000
25,000,000 5.24 03/24/99 25,010,369
Morgan Stanley Dean Witter & Co.
80,000,000 5.30 01/15/99 79,999,704
National Rural Utilities Corp.
25,000,000 5.17 02/25/99 25,000,000
New York Life Insurance Co.
25,000,000 5.21 01/07/99 25,000,000
40,000,000 5.31 01/07/99 40,000,000
Norwest Financial
30,000,000 5.17 03/22/99 29,997,931
Old Kent Bank & Trust Co.
30,000,000 5.10 02/01/99 29,995,215
PNC Bank, N.A.
50,000,000 5.43 01/04/99 49,982,644
100,000,000 5.50 01/04/99 99,960,951
Postipankki Ltd.
25,000,000 5.32 02/09/99 24,998,693
SMM Trust Series 1998-A
40,000,000 5.32 03/16/99 40,000,000
Societe Generale, New York
45,000,000 5.51 01/07/99 44,993,064
25,000,000 5.54 01/26/99 24,992,568
Southtrust Bank of Alabama, N.A.
40,000,000 5.08 01/21/99 39,994,093
SunAmerica Life Insurance Co.
50,000,000 5.64 01/04/99 50,000,000
Svenska Handelsbanken
150,000,000 5.44 01/04/99 149,963,406
34,500,000 5.34 02/18/99 34,496,231
Westpac Banking Corp.
50,000,000 5.10 02/03/99 49,987,061
- ----------------------------------------------------------------------------------------------
Total Variable Rate Obligations $2,324,082,232
- ----------------------------------------------------------------------------------------------
Repurchase Agreement--0.6%
Joint Repurchase Agreement Account(b)
$ 36,200,000 4.82% 01/04/99 $ 36,200,000
- ----------------------------------------------------------------------------------------------
Total Repurchase Agreement $ 36,200,000
- ----------------------------------------------------------------------------------------------
Total Investments $6,085,098,505(d)
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
9
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------------------------------------------------
(a) Forward commitments.
(b) A portion of this security is segregated for forward commitments.
(c) Variable rate security-base index is either U.S. Treasury Bill, LIBOR, one
month commercial paper, Federal Funds, or Prime lending rate.
(d) 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.
10
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Premium Money Market Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Commercial Paper and Corporate Obligations--29.0%
Agricultural Services
Cargill, Inc.
$10,000,000 5.37% 02/23/99 $ 9,920,942
Bank Holding Companies
Banque Et Caisse Epargne
5,000,000 5.01 03/29/99 4,939,463
Deutsche Bank Financial
5,000,000 5.60 01/07/99 4,995,333
Dresdner U.S. Finance
15,000,000 5.41 01/04/99 14,993,238
IMI Funding Corp., U.S.A.
5,927,000 5.38 02/26/99 5,877,398
San Paolo U.S. Finance Co.
5,000,000 5.31 03/01/99 4,956,488
Business Credit Institutions
General Electric Capital Corp.
10,000,000 4.88 06/11/99 9,781,755
Electric and Gas Services
Hydro Quebec
5,510,000 7.74 02/26/99 5,525,996
Receivable/Asset Financing
Asset Portfolio Funding
5,000,000 5.20 03/17/99 4,945,833
Asset Securitization Corp.
15,000,000 5.15 03/12/99 14,849,792
CC USA, Inc.
10,000,000 5.27 01/29/00 9,959,011
Corporate Receivables Corp.
10,000,000 5.50 01/12/99 9,983,194
5,000,000 5.25 02/19/99 4,964,271
Edison Asset Securitization Corp.
5,000,000 5.13 01/29/99 4,980,050
5,000,000 5.14 02/26/99 4,960,022
5,000,000 5.15 03/22/99 4,942,778
Receivables Capital Corp.
15,000,000 5.50 01/04/99 14,993,125
Riverwoods Funding Corp.
10,000,000 5.05 02/25/99 9,922,847
WCP Funding, Inc.
10,000,000 5.53 01/12/99 9,983,103
Windmill Funding
5,000,000 5.30 01/15/99 4,989,694
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Commercial Paper and Corporate Obligations (continued)
Mortgage Banking
Northern Rock PLC
$ 5,000,000 5.12% 02/02/99 $ 4,977,244
Security and Commodity Brokers, Dealers and Services
J.P. Morgan Securities, Inc.
5,000,000 5.02 04/21/99 4,923,306
Morgan Stanley Dean Witter & Co.
5,000,000 5.20 03/24/99 4,940,778
Salomon Smith Barney Holdings, Inc.
5,000,000 5.20 03/12/99 4,949,444
- --------------------------------------------------------------------------------------------------
Total Commercial Paper and Corporate Obligations $180,255,105
- --------------------------------------------------------------------------------------------------
Bank Notes--1.6%
BankBoston, N.A.
$ 5,000,000 5.11% 04/05/99 $ 5,000,000
5,000,000 5.15 05/04/99 5,000,000
- --------------------------------------------------------------------------------------------------
Total Bank Notes $ 10,000,000
- --------------------------------------------------------------------------------------------------
Certificates of Deposit--Yankeedollar--5.3%
Deutsche Bank, New York
$ 5,000,000 5.65% 03/22/99 $ 4,999,422
National Bank of Canada, New York
5,000,000 5.76 06/10/99 4,998,741
Royal Bank of Canada, New York
5,000,000 5.56 02/26/99 5,000,930
Societe Generale, New York
2,000,000 5.72 03/05/99 1,999,835
3,000,000 5.63 04/06/99 2,998,680
Swiss Bank Corp., New York
5,000,000 5.74 06/09/99 4,998,749
UBS, New York
5,000,000 5.23 01/13/99 5,000,024
Westpac Banking Corp., New York
3,000,000 5.77 05/12/99 2,999,382
- --------------------------------------------------------------------------------------------------
Total Certificates of Deposit--Yankeedollar $ 32,995,763
- --------------------------------------------------------------------------------------------------
Variable Rate Obligations(a)--26.6%
Abbey National Treasury Services
$10,000,000 5.37% 01/15/99 $ 9,995,332
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
11
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Variable Rate Obligations (continued)
Bank of Austria, New York
$ 5,000,000 5.49% 01/04/99 $ 4,998,544
BankAmerica Corp.
6,000,000 5.39 01/15/99 6,004,337
Barclays Bank PLC
5,000,000 5.49 01/04/99 4,998,363
Bayerische Landesbank
5,000,000 5.49 01/25/99 4,999,491
2,000,000 5.09 03/23/99 1,999,655
C.S. First Boston Corp.
10,000,000 5.57 02/01/99 10,000,000
Citicorp, Inc.
5,000,000 5.20 03/17/99 5,000,000
Comerica Bank Detroit
5,000,000 5.11 03/10/99 4,998,495
Den Danske Bank Corp.
5,000,000 5.56 01/25/99 4,999,891
First Tennessee Bank, N.A.
5,000,000 5.07 01/25/99 4,999,248
First U.S.A. Bank
5,000,000 5.52 02/01/99 5,001,461
First Union National Bank
2,000,000 4.71 01/04/99 1,997,869
IBM Corp.
10,000,000 5.23 02/12/99 9,993,672
Istituto Bancario, New York
5,000,000 5.12 02/24/99 4,998,655
J.P. Morgan Securities, Inc.
5,000,000 5.48 01/07/99 4,998,506
Keybank, N.A.
3,000,000 5.52 01/11/99 2,999,352
Merrill Lynch & Co., Inc.
5,000,000 5.48 01/13/99 4,999,693
5,000,000 5.57 01/25/99 5,000,000
Morgan Stanley Dean Witter & Co.
5,000,000 5.30 01/15/99 4,999,981
National Rural Utilities Corp.
5,000,000 5.17 02/25/99 5,000,000
Old Kent Bank & Trust Co.
5,000,000 5.10 02/01/99 4,999,203
PepsiCo Inc.
10,000,000 5.21 02/19/99 9,992,890
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Variable Rate Obligations (continued)
PNC Bank, N.A.
$ 5,000,000 5.50% 01/04/99 $ 4,997,873
5,000,000 5.50 01/27/99 4,998,048
SMM Trust Series 1998-A
2,000,000 5.32 03/16/99 2,000,000
Southtrust Bank of Alabama, N.A.
5,000,000 5.08 01/21/99 4,999,262
Svenska Handelsbanken
5,000,000 5.44 01/04/99 4,998,780
U.S. Bank, N.A.
10,000,000 5.50 01/08/99 9,998,493
Westpac Banking Corp.
5,000,000 5.11 02/03/99 4,998,706
- -------------------------------------------------------------------------------------------------
Total Variable Rate Obligations $164,965,800
- -------------------------------------------------------------------------------------------------
Repurchase Agreements--37.5%
Joint Repurchase Agreement Account
$182,800,000 4.82% 01/04/99 $182,800,000
Joint Repurchase Agreement Account II
50,000,000 4.89 01/04/99 50,000,000
- -------------------------------------------------------------------------------------------------
Total Repurchase Agreements $232,800,000
- -------------------------------------------------------------------------------------------------
Total Investments $621,016,668(b)
- -------------------------------------------------------------------------------------------------
</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) 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.
12
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Treasury Obligations Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Treasury Obligations--16.2%
United States Treasury Notes
$ 85,000,000 6.38% 04/30/99 $ 85,209,148
60,000,000 6.38 05/17/99 60,165,750
60,000,000 6.25 06/01/99 60,166,783
115,000,000 6.00 06/30/99 115,515,225
42,000,000 6.00 08/16/99 42,428,849
52,000,000 7.13 09/30/99 52,819,839
202,000,000 7.50 11/01/99 207,137,071
195,000,000 5.88 11/15/99 197,252,584
50,000,000 7.75 11/30/99 51,350,109
- ------------------------------------------------------------------------------------------------
Total U.S. Treasury Obligations $ 872,045,358
- ------------------------------------------------------------------------------------------------
Repurchase Agreements--84.0%
ABN/AMRO, Inc. (a)
$ 235,000,000 4.92% 01/04/99 $ 235,000,000
Barclays Bank(a)
235,000,000 4.88 01/06/99 235,000,000
Bear Stearns Companies, Inc.(a)
235,000,000 4.60 01/04/99 235,000,000
C.S. First Boston Corp.(a)
235,000,000 4.82 01/04/99 235,000,000
CIBC Oppenheimer, Inc.(a)
100,000,000 4.70 01/04/99 100,000,000
Deutsche Bank(a)
235,000,000 4.88 01/04/99 235,000,000
Goldman, Sachs & Co.(a)
235,000,000 4.96 01/04/99 235,000,000
Joint Repurchase Agreement Account
1,678,200,000 4.82 01/04/99 1,678,200,000
J.P. Morgan Securities, Inc.(a)
235,000,000 4.75 01/04/99 235,000,000
Lehman Government Securities, Inc.(a)
235,000,000 4.90 01/04/99 235,000,000
Merrill Lynch Government Securities, Inc.(a)
160,000,000 4.65 01/04/99 160,000,000
Morgan Stanley Government Securities, Inc.(a)
240,000,000 5.75 01/04/99 240,000,000
NationsBanc Montgomery Securities LLC(a)
235,000,000 4.75 01/04/99 235,000,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Repurchase Agreements (continued)
Salomon Smith Barney Holdings, Inc.(a)
$ 235,000,000 4.90% 01/04/99 $ 235,000,000
- -----------------------------------------------------------------------------------------------
Total Repurchase Agreements $4,528,200,000
- -----------------------------------------------------------------------------------------------
Total Investments $5,400,245,358(b)
- -----------------------------------------------------------------------------------------------
</TABLE>
(a) At December 31, 1998, these agreements were fully collateralized by U.S.
Treasury obligations.
(b) The amount stated also represents aggregate cost for federal income tax
purposes.
The percentages shown for each investment category reflects 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.
13
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Treasury Instruments Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Treasury Obligations--100.4%
United States Treasury Bills
$ 80,000,000 4.01% 01/07/99 $ 79,946,533
15,000,000 4.22 01/07/99 14,989,456
82,900,000 4.26 01/07/99 82,841,141
25,000,000 4.03 01/14/99 24,963,663
4,800,000 4.40 01/21/99 4,788,280
174,300,000 4.48 01/21/99 173,866,186
21,900,000 4.26 01/28/99 21,830,030
100,000,000 4.35 02/04/99 99,589,167
18,100,000 4.51 02/04/99 18,022,904
22,000,000 4.29 02/11/99 21,892,512
35,000,000 4.34 02/11/99 34,827,202
100,000,000 4.35 02/11/99 99,504,583
35,900,000 4.36 02/11/99 35,721,737
34,900,000 4.40 02/11/99 34,725,112
84,900,000 4.38 03/04/99 84,260,302
35,000,000 4.41 03/11/99 34,704,163
- -------------------------------------------------------------------------------------------------
Total U.S. Treasury Obligations $866,472,971
- -------------------------------------------------------------------------------------------------
Total Investments $866,472,971(a)
- -------------------------------------------------------------------------------------------------
</TABLE>
(a) The amount stated also represents aggregate cost for federal income tax
purposes.
Interest rates represent the annualized yield on date of purchase for
discounted notes.
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.
14
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Government Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Government Agency Obligations--74.7%
Federal Farm Credit Bank
$ 35,970,000 5.65% 01/04/99 $ 35,969,573
48,000,000 4.76(a) 01/18/00 47,912,400
Federal Home Loan Bank
88,760,000 4.75 01/20/99 88,537,484
50,000,000 5.50 03/26/99 49,981,819
37,795,000 5.63 04/09/99 37,788,930
38,045,000 5.52 08/12/99 38,184,017
125,000,000 4.86(a)(b) 04/11/00 124,913,750
Federal Home Loan Mortgage Corp.
50,000,000 5.41(b) 01/04/99 49,987,532
150,000,000 5.35(b) 01/18/99 149,935,064
115,000,000 5.44(b) 01/26/99 114,994,661
155,000,000 5.15 02/03/99 154,268,271
30,000,000 4.92 03/19/99 29,684,300
81,769,000 4.79 04/09/99 80,702,778
240,000,000 5.36(b) 04/21/99 239,957,326
41,000,000 5.60 04/21/99 41,102,352
Federal National Mortgage Association
85,000,000 4.98(b) 01/05/99 84,974,700
95,000,000 5.07 01/08/99 94,906,346
80,000,000 5.33(b) 01/17/99 79,991,913
200,000,000 5.36(b) 01/22/99 199,993,172
50,000,000 4.96(b) 01/23/99 49,978,159
41,000,000 5.41 02/23/99 40,989,434
35,000,000 5.53 03/11/99 34,994,972
40,000,000 4.98(b) 03/15/99 39,984,830
48,095,000 6.00 09/02/99 48,332,404
70,000,000 4.78 11/30/99 69,973,148
25,890,000 4.72 12/16/99 25,868,971
Student Loan Marketing Association
100,000,000 5.45(b) 01/03/99 99,940,164
25,000,000 5.63 06/30/99 24,995,685
- -----------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations $2,178,844,155
- -----------------------------------------------------------------------------------------------
Repurchase Agreements--31.3%
ABN/AMRO, Inc.(c)
$200,000,000 5.15% 01/04/99 $ 200,000,000
Joint Repurchase Agreement Account(d)
314,000,000 4.82 01/04/99 314,000,000
Joint Repurchase Agreement Account II
200,000,000 4.89 01/04/99 200,000,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Repurchase Agreements (continued)
NationsBanc Montgomery Securities LLC(c)
$200,000,000 5.15% 01/04/99 $ 200,000,000
- ----------------------------------------------------------------------------------------------
Total Repurchase Agreements $ 914,000,000
- ----------------------------------------------------------------------------------------------
Total Investments $3,092,844,155(e)
- ----------------------------------------------------------------------------------------------
</TABLE>
(a) Forward commitments.
(b) Variable rate security-base index is either Federal Funds, Prime lending
rate, or LIBOR.
(c) At December 31, 1998, these securities were fully collateralized by Federal
Agency obligations.
(d) A portion of this security is segregated for forward commitments.
(e) 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.
15
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Federal Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Government Agency Obligations--107.5%
Federal Farm Credit Bank
$ 60,000,000 4.50% 01/04/99 $ 59,977,500
50,000,000 5.09(a) 01/04/99 50,000,000
12,100,000 5.13 01/12/99 12,081,033
14,000,000 5.10 01/13/99 13,976,200
9,700,000 5.07 01/15/99 9,680,875
18,000,000 5.06 01/19/99 17,954,460
9,700,000 5.05 01/20/99 9,674,147
20,000,000 5.01 02/01/99 19,913,717
10,000,000 4.98 02/08/99 9,947,433
10,000,000 5.14 02/10/99 9,942,889
25,000,000 4.98 02/12/99 24,854,750
30,000,000 5.38 03/02/99 29,991,641
75,000,000 5.34(a) 04/15/99 74,989,490
25,000,000 5.35(a) 05/03/99 24,995,886
15,000,000 4.81 05/17/99 14,727,433
35,000,000 5.00(a) 06/01/99 34,991,503
60,000,000 5.00(a) 07/01/99 59,982,547
90,000,000 5.36(a) 07/23/99 89,960,517
100,000,000 5.34(a) 08/05/99 99,959,220
50,000,000 5.50 09/01/99 50,091,696
50,000,000 5.37(a) 10/13/99 50,000,000
60,000,000 5.37(a) 10/15/99 60,000,000
7,500,000 4.75 12/01/99 7,491,229
35,000,000 5.41(a) 12/01/99 35,000,000
58,000,000 4.76(b) 01/18/00 57,942,822
Federal Home Loan Bank
20,000,000 4.30 01/04/99 19,992,833
1,900,000 4.75 01/04/99 1,899,248
32,655,000 5.03 01/04/99 32,641,312
100,000,000 5.04 01/04/99 99,958,042
30,000,000 5.04 01/04/99 29,987,400
3,400,000 5.08 01/04/99 3,398,561
149,000,000 4.70 01/06/99 148,902,735
20,000,000 5.03 01/06/99 19,986,028
25,823,000 5.04 01/06/99 25,804,924
50,000,000 4.75 01/08/99 49,953,819
1,000,000 5.06 01/13/99 998,313
80,000,000 4.75 01/15/99 79,852,222
40,000,000 4.84 01/15/99 39,924,711
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Government Agency Obligations (continued)
Federal Home Loan Bank (continued)
$ 88,600,000 4.75% 01/20/99 $ 88,377,885
10,400,000 5.12 01/20/99 10,371,897
27,700,000 4.79 01/22/99 27,622,602
25,000,000 4.94 01/22/99 24,927,958
28,784,000 4.82 01/27/99 28,683,800
48,970,000 5.03 02/03/99 48,744,207
19,000,000 5.05 02/03/99 18,912,046
40,000,000 5.05 02/05/99 39,803,611
75,000,000 5.34(a) 02/11/99 74,994,231
50,000,000 4.90 02/17/99 49,680,139
117,050,000 5.00 03/03/99 116,059,318
23,000,000 4.95 03/05/99 22,800,763
40,000,000 4.96 03/08/99 39,636,267
34,000,000 4.96 03/10/99 33,681,458
21,000,000 4.99(a) 03/10/99 20,994,784
20,000,000 5.60 03/10/99 19,999,851
83,000,000 4.95 03/17/99 82,144,063
27,095,000 4.97 03/17/99 26,814,454
50,000,000 4.96 03/17/99 49,483,333
48,258,000 4.95 03/19/99 47,747,068
5,000,000 4.97 03/19/99 4,946,849
21,189,000 4.82 05/05/99 20,837,216
34,889,000 4.84 05/05/99 34,307,362
20,000,000 5.61 06/18/99 19,994,919
100,000,000 5.38(a) 09/08/99 99,965,753
75,000,000 4.80(a) 11/09/99 74,956,021
125,000,000 4.86(a)(b) 01/11/00 124,913,750
Student Loan Marketing Association
25,000,000 4.28 01/04/99 24,991,083
150,000,000 4.99(c) 01/19/99 149,625,750
100,000,000 4.73(c) 01/27/99 99,658,389
75,000,000 5.01 02/11/99 74,572,062
12,890,000 4.95 02/16/99 12,808,471
70,000,000 4.99(a) 04/01/99 69,993,268
25,000,000 5.13(a) 04/16/99 24,996,476
30,000,000 5.63 06/02/99 29,993,954
10,000,000 5.63 06/30/99 9,997,815
130,000,000 5.00(a) 09/15/99 129,932,382
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
16
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Federal Fund (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Government Agency Obligations (continued)
Student Loan Marketing Association (continued)
$ 75,000,000 5.37(a) 10/15/99 $ 75,000,000
100,000,000 5.45(a) 12/03/99 99,940,164
65,000,000 5.24(a)(b) 01/11/00 64,968,150
Tennessee Valley Authority
40,000,000 5.08 01/28/99 39,847,600
- ---------------------------------------------------------------------------------------------
Total U.S. Government Agency Obligations $3,639,154,305
- ---------------------------------------------------------------------------------------------
Total Investments $3,639,154,305(d)
- ---------------------------------------------------------------------------------------------
</TABLE>
(a) Variable rate security-base index is either U.S. Treasury Bill, Federal
Funds, Prime lending rate, or LIBOR.
(b) Forward commitments.
(c) A portion of these securities are segregated for forward commitments.
(d) 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.
17
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Tax-Free Money Market Fund
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Alabama--4.4%
City of Mobile Industrial Development PCRB for Alabama Power
Series 1993 A (A-1/VMIG1)
$ 4,600,000 3.95% 01/07/99 $ 4,600,000
City of Valdez Marine Terminal RB for Arco Transportation 1994
Series B (A-1/VMIG1)
8,200,000 4.15 01/07/99 8,200,000
Columbia IDB PCRB for Alabama Power Company Series 1995 B
(A-1/VMIG1)
25,000,000 5.00 01/04/99 25,000,000
Columbia IDB PCRB for Alabama Power Company Series 1995 D
(A-1/VMIG1)
2,000,000 4.80 01/04/99 2,000,000
Columbia Town IDRB for Alabama Power Co. Series 1996 A
(A-1/VMIG1)
8,300,000 5.00 01/04/99 8,300,000
Eutaw City IDB PCRB for Mississippi Power Co. Greene County Plant Project
Series 1992 (A-1/VMIG1)
6,550,000 4.10 01/07/99 6,550,000
Homewood City Educational Building Authority Educational Facilities RB for
Samford University Series 1996 (Bank of Nova Scotia)
(A-1+/VMIG1)
7,900,000 5.00 01/04/99 7,900,000
Jefferson County MF Hsg. RB for Hickory Knolls Project Series 1994
(Amsouth Bank LOC) (P-1)
3,770,000 4.05 01/07/99 3,770,000
Montgomery City Special Care RB Series 1994 A (Amsouth Bank) (VMIG1)
7,900,000 3.95 01/07/99 7,900,000
- -----------------------------------------------------------------------------------------------
$ 74,220,000
- -----------------------------------------------------------------------------------------------
Arizona--2.3%
Maricopa County PCRB for Arizona Pollution Control Corp.
Series 1994 A (Morgan Guaranty Trust Co.) (A-1+/P-1)
$ 5,200,000 5.10% 01/04/99 $ 5,200,000
Maricopa County PCRB Series 1994 D (Bank of America National Trust &
Savings) (A-1+/P-1)
11,700,000 5.05 01/04/99 11,700,000
Tempe VRDN Excise Tax Revenue Obligations Series 1998
(A-1+/VMIG1)
21,800,000 5.00 01/04/99 21,800,000
- -----------------------------------------------------------------------------------------------
$ 38,700,000
- -----------------------------------------------------------------------------------------------
California--2.4%
California Health Facilities Authority Insured Variable Rate Hospital RB
for Adventist Health System/West Series 1998 A
(MBIA) (A-1+/VMIG1)
$ 9,500,000 5.00% 01/04/99 $ 9,500,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
California (continued)
California Pollution Control Financing Authority PCRB for Pacific Gas &
Electric Company Series 1996 F (Banque Nationale de Paris, S.A.) (A-1)
$ 3,600,000 5.00% 01/04/99 $ 3,600,000
City of Long Beach TRANS Series 1998-1999 (SP-1+)
3,400,000 4.00 10/05/99 3,421,009
Irvine Ranch Water District Consolidated Refunding Series 1985 B
(Landesbank Hessen-Thuringen LOC) (A-1+)
4,000,000 5.00 01/04/99 4,000,000
Los Angeles County TRANS Series 1998-99 A (SP-1+/MIG1)
10,000,000 4.50 06/30/99 10,045,198
State of California Municipal Securities Trust Receipt Series 1997 SGA 55
(FGIC) (A-1+)
9,300,000 4.03 01/07/99 9,300,000
- -----------------------------------------------------------------------------------------------
$ 39,866,207
- -----------------------------------------------------------------------------------------------
Colorado--1.0%
Jefferson County School District TANS Series 1998 (SP-1+/MIG1)
$15,910,000 4.00% 06/30/99 $ 15,975,320
- -----------------------------------------------------------------------------------------------
Connecticut--1.5%
State of Connecticut 2nd Lien Special TRANS VRDN (Commerzbank Bank LOC)
(A-1+/VMIG1)
$25,700,000 4.10% 01/07/99 $ 25,700,000
- -----------------------------------------------------------------------------------------------
Florida--1.8%
Florida Local Government Finance Commission Series A (First Union National
Bank) (A-1/P-1)
$16,890,000 3.00% 03/15/99 $ 16,890,000
Putnam County Development Authority Floating/Fixed Rate PCRB for Seminole
Electric Series 1984 H1 (NRU LOC) (A-1+/P-1)
3,600,000 4.05 01/07/99 3,600,000
Putnam County Development Authority Floating/Fixed Rate PCRB for Seminole
Electric Series 1984 H2 (NRU LOC) (A-1+/P-1)
6,530,000 4.05 01/07/99 6,530,000
Putnam County Development Authority Floating/Fixed Rate PCRB for Seminole
Electric Series 1984 S (NRU LOC) (A-1+/P-1)
2,655,000 4.05 01/07/99 2,655,000
- -----------------------------------------------------------------------------------------------
$ 29,675,000
- -----------------------------------------------------------------------------------------------
Georgia--13.4%
Bartow County IDA PCRB for Georgia Power Co. First Series 1997
(A-1/VMIG1)
$38,000,000 5.00% 01/04/99 $ 38,000,000
Burke County IDA Adjustable Tender PCRB for Oglethorpe Power Corp. Series
1993 A (FGIC) (A-1+/VMIG1)
21,200,000 3.85 01/07/99 21,200,000
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
18
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Tax-Free Money Market Fund (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Georgia (continued)
Burke County IDA PCRB for Georgia Power Co. First Series 1997
(A-1/VMIG1)
$11,200,000 5.05% 01/04/99 $ 11,200,000
Burke County IDA PCRB for Oglethorpe Power Corp. Series 1993 A (FGIC)(A-
1+/VMIG1)(a)
12,000,000 3.80 01/07/99 12,000,000
Burke County PCRB Series 1994 A for Oglethorpe Power Corp. (FGIC) (A-
1+/VMIG1)
3,175,000 3.85 01/07/99 3,175,000
Dekalb County Hospital Authority Revenue Anticipation Certificates for
Dekalb Medical Center Series 1993 B (Suntrust Bank) (VMIG1)
2,030,000 4.00 01/07/99 2,030,000
Georgia Municipal Electric and Gas Project One Subordinated Bonds Series
1994 E (ABN/AMRO Bank, N.V.) (A-1+/VMIG1)
31,290,000 3.80 01/07/99 31,290,000
Georgia Municipal Gas Authority RB for Agency Project Series B (C.S. First
Boston/Morgan Guaranty/Bayerische Landesbank Girozentrale/Wachovia Bank
N.A./ABN/AMRO Bank, N.V.) (A-1+)
9,900,000 4.15 01/07/99 9,900,000
Georgia Municipal Gas Authority RB Series A (C.S. First Boston /Morgan
Guaranty/Bayerische Landesbank Girozentrale/Wachovia Bank N.A./ABN/AMRO
Bank, N.V.) (A-1+)
20,305,000 4.15 01/07/99 20,305,000
Georgia Municipal Gas Authority RB for Gas Portfolio II Project Series A
(C.S. First Boston/Morgan Guaranty/Bayerische Landensbank
Girozentrale/Wachovia Bank N.A. ABN/AMRO Bank, N.V.) (A-1+)(a)
6,840,000 3.80 01/07/99 6,840,000
Georgia Municipal Gas Authority RB for Gas Portfolio II Project Series B
(C.S. First Boston/Morgan Guaranty/Bayerische Landesbank
Girozentrale/Wachovia Bank N.A.) (A-1+)
47,055,000 3.90 01/07/99 47,055,000
Municipal Electric Authority of Georgia Subordinated General Resolution
Bonds Series 1985 C (Bayerische Landesbank Girozentrale LOC) (A-1+/VMIG1)
14,400,000 4.15 01/07/99 14,400,000
Municipal Electric Authority of Georgia Subordinate General Resolution
Bonds Series 1985 B (Landesbank Hessen-Thuringen LOC)
(A-1+/VMIG1)
7,200,000 3.95 01/07/99 7,200,000
- -----------------------------------------------------------------------------------------------
$224,595,000
- -----------------------------------------------------------------------------------------------
Idaho--1.2%
State of Idaho TANS Series 1998 (MIG1/SP-1+)
$20,000,000 4.50% 06/30/99 $ 20,085,648
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Illinois--6.0%
Chicago City RB for Chicago Midway Airport Series 1996A Societe Generale
Trustor Municipal Securities Trust Receipts (MBIA) (A-1+C)
$ 7,540,000 4.10% 01/07/99 $ 7,540,000
Cook County GO VRDN Series 1996 (A-1+/VMIG1)
1,000,000 4.10 01/07/99 1,000,000
Illinois Health Facilities Authority VRDN Adjustable RB for Evanston
Northwestern Health Care Corp. Series 1998 (A-1+/VMIG1)
7,500,000 3.70 06/01/99 7,500,000
Illinois Health Facilities Authority VRDN for Elmhurst Memorial Health
Systems Series 93B (VMIG1)
3,200,000 5.15 01/04/99 3,200,000
Illinois Health Facilities Authority VRDN for Northwest Community Hospital
Series 1997 (A-1+/VMIG1)
8,200,000 4.00 01/07/99 8,200,000
Illinois Health Facilities Authority VRDN for the Revolving Fund Pooled
Finance Program Series 1985 C (The First National Bank of Chicago) (A-
1+/VMIG1)
19,000,000 4.10 01/07/99 19,000,000
Illinois Health Facilities Authority VRDN RB for Northwest Community
Hospital Series 1995 (A-1+/VMIG1)
4,800,000 4.00 01/07/99 4,800,000
Illinois Health Facility Authority VRDN Revolving Fund Pooled Finance
Program Series 85D (The First National Bank of Chicago)
(A- 1+/VMIG1)
21,000,000 4.10 01/07/99 21,000,000
Illinois State GO Eagle Tax Exempt Trust Series 1995 96C1305 Class A COPS
(FGIC) (A-1C)
14,850,000 4.15 01/07/99 14,850,000
O'Hare International Airport Adjustable Rate RB for American Airlines
Series 1983 B (P-1)
10,100,000 5.00 01/04/99 10,100,000
Sauget Village PCRB VRDN for Monsanto Project Series 1992 (P-1)
1,000,000 4.15 01/07/99 1,000,000
Sauget Village PCRB VRDN for Monsanto Project Series 1993 (P-1)
1,900,000 4.15 01/07/99 1,900,000
- -----------------------------------------------------------------------------------------------
$100,090,000
- -----------------------------------------------------------------------------------------------
Indiana--2.3%
Fort Wayne Hospital Authority VRDN for Parkview Memorial Hospital Series
1985 B (Bank of America LOC) (VMIG1)
$1,600,000 3.90% 01/07/99 $ 1,600,000
Indiana Development Finance Authority Series 1997 (Bayer Corporation) (A-
1+/P-1)
4,800,000 5.15 01/04/99 4,800,000
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
19
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Indiana (continued)
Indiana Health Facilities Financing Authority Hospital RB Series 1997 E
(A-1+/VMIG1)(a)
$19,540,000 3.80% 01/07/99 $ 19,540,000
Indiana Hospital Equipment Financing Authority VRDN Series 1985 A (MBIA)
(A-1/VMIG1)
5,000,000 4.00 01/07/99 5,000,000
Warrick County PCRB for ALCOA Series 1992 (A-1)
7,475,000 4.15 01/07/99 7,475,000
- -----------------------------------------------------------------------------------------------
$ 38,415,000
- -----------------------------------------------------------------------------------------------
Iowa--1.9%
Chillicothe City PCRB for Midamerican Energy Co./Midwest Power Systems
Series 1993 A (A-1/VMIG1)
$ 2,400,000 4.20% 01/07/99 $ 2,400,000
Louisa County PCRB for Iowa-Illinois Gas & Electric Co./Midamerican Energy
Co. Series 1986 A (A-1)
9,100,000 4.20 01/07/99 9,100,000
Louisa County PCRB for Midwest Power Systems Inc. Series 1994
(A-1/VMIG1)(b)
20,000,000 4.20 01/07/99 20,000,000
- -----------------------------------------------------------------------------------------------
$ 31,500,000
- -----------------------------------------------------------------------------------------------
Kentucky--2.2%
Calvert PCRB for Air Products and Chemicals, Inc. Project Series 1993 A
(A-1)
$ 3,000,000 4.10% 01/07/99 $ 3,000,000
Kentucky Economic Development Financing Authority Adjustable Rate Hospital
Facilities RB for the Health Alliance of Greater Cincinnati Series 1997 D
(MBIA) (A-1+/VMIG1)
11,700,000 4.00 01/07/99 11,700,000
Kentucky Turnpike Authority Resource Recovery Road Refunding RB Series
1987 A Trust Receipts, Series 1997 (FSA) (A-1+/VMIG1)
18,165,000 4.10 01/07/99 18,165,000
Trimble County PCRB for Louisville Gas and Electric Co. Series 1996 A (A-
1/VMIG1)
4,000,000 3.05 03/26/99 4,000,000
- -----------------------------------------------------------------------------------------------
$ 36,865,000
- -----------------------------------------------------------------------------------------------
Louisiana--1.2%
Calcasieu Parish VRDN for Olin Corp. Series 1993 B (Wachovia Bank N.A. (A-
1+)
$ 5,500,000 5.10% 01/04/99 $ 5,500,000
East Baton Rouge PCRB for Exxon Project Series 1993 (A-1+/P-1)
4,900,000 5.00 01/04/99 4,900,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Louisiana (continued)
Parish of Desoto PCRB for Central Louisiana Electric Co. Series 1991 A
(Westdeutsche Landesbank Girozentrale LOC) (A-1+/VMIG1)
$10,000,000 3.85% 01/07/99 $ 10,000,000
- -----------------------------------------------------------------------------------------------
$ 20,400,000
- -----------------------------------------------------------------------------------------------
Maryland--2.4%
Maryland State & Local Loan of 1998 GO Puttable Floating Option
Tax-Exempt Securities Receipts PA-256 Series 1 (A-1+)
$29,665,000 4.10% 01/07/99 $ 29,665,000
Washington Suburban Sanitary District GO VRDN Series 1998 (A-1+/VMIG1)
11,000,000 4.05 01/07/99 11,000,000
- -----------------------------------------------------------------------------------------------
$ 40,665,000
- -----------------------------------------------------------------------------------------------
Massachusetts--4.2%
Commonwealth of Massachusetts GO Refunding Bonds Series 1998 A (A-
1+/VMIG1)
$ 3,000,000 3.90% 01/07/99 $ 3,000,000
Commonwealth of Massachusetts GO Refunding Bonds 1995 A (AA3/AA-)
5,000,000 5.50 07/01/99 5,053,395
Commonwealth of Massachusetts GO Refunding Bonds 1997 A (AA3/AA-)
9,485,000 4.50 08/01/99 9,571,168
Massachusetts Health & Education Facility Authority for Harvard University
Series A Eagle Tax-Exempt Trust Series 972104 Class A COPS (A-1+C)
10,000,000 4.15 01/07/99 10,000,000
Massachusetts Water Resources Authority Subordinated General Revenue RB
Series 1998 D (FGIC) (A-1+/VMIG1)
42,195,000 3.90 01/07/99 42,195,000
- -----------------------------------------------------------------------------------------------
$ 69,819,563
- -----------------------------------------------------------------------------------------------
Michigan--1.8%
Michigan Building Authority CP Notes Series 2 (Canadian Imperial Bank of
Commerce) (A-1+/P-1)
$17,500,000 3.30% 02/09/99 $ 17,500,000
Michigan State Trunk Line Fund Series 1998 A--Eagle Tax-Exempt Trust
Series 982202 Class A Certificates (A-1+C)
12,165,000 4.13 01/07/99 12,165,000
- -----------------------------------------------------------------------------------------------
$ 29,665,000
- -----------------------------------------------------------------------------------------------
Minnesota--0.2%
Port Authority of St. Paul VRDN for Weyerhaeuser Project Series 1993 (A-1)
$ 4,000,000 4.10% 01/07/99 $ 4,000,000
- -----------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
20
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Tax-Free Money Market Fund (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Mississippi--0.6%
Jackson County PCRB for Chevron U.S.A. Series 1992 (VMIG1)
$10,000,000 5.10% 01/04/99 $ 10,000,000
- -----------------------------------------------------------------------------------------------
Missouri--0.4%
Missouri Environmental Improvement & Energy VRDN PCRB for Monsanto Series
1993 (P-1)
$ 1,500,000 4.10% 01/07/99 $ 1,500,000
Missouri Refunding RB for Washington University Series 1984 (A-1+/VMIG1)
5,800,000 4.10 01/07/99 5,800,000
- -----------------------------------------------------------------------------------------------
$ 7,300,000
- -----------------------------------------------------------------------------------------------
Nevada--3.1%
Clark County Refunding RB for Nevada Airport System Series 1993 A (MBIA)
(A-1+/VMIG1)
$52,060,000 3.85% 01/07/99 $ 52,060,000
- -----------------------------------------------------------------------------------------------
New Jersey--1.6%
New Jersey TRANS Series 1999 A (A-1+/P-1)
$ 5,000,000 3.35% 03/11/99 $ 5,000,000
13,500,000 2.95 03/17/99 13,500,000
7,500,000 3.35 04/06/99 7,500,000
- -----------------------------------------------------------------------------------------------
$ 26,000,000
- -----------------------------------------------------------------------------------------------
New Mexico--0.4%
State of New Mexico TRANS Series 1998 (SP-1+/MIG1)
$ 6,800,000 4.25% 06/30/99 $ 6,821,041
- -----------------------------------------------------------------------------------------------
New York--6.2%
Long Island Power Authority Electric System Subordinated RB Series 3
(Bayerische Landesbank Girozentrale/Westdeutsche Landesbank Girozentrale)
(A-1+/VMIG1)
$22,000,000 2.90% 03/11/99 $ 22,000,000
Long Island Power Authority Electric System Subordinated RB Series 4
(Bayerische Landesbank Girozentrale/Westdeutsche Landesbank Girozentrale)
(A-1+/VMIG1)
24,800,000 3.05 03/09/99 24,800,000
Long Island Power Authority Electric System Subordinated RB Series 6
(Morgan Guaranty Trust Co./ABN/AMRO Bank, N.V.) (A-1+/VMIG1)
16,930,000 4.85 01/04/99 16,930,000
New York City Adjustable Rate GO Bonds Series 1994 B/Subseries B-2 (Morgan
Guaranty Trust) (A-1+/VMIG1)
700,000 5.00 01/04/99 700,000
New York City GO Bonds Fiscal 1995 Series B-5 (MBIA) (A-1+/VMIG1)
2,370,000 5.15 01/04/99 2,370,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
New York (continued)
New York City GO Puttable Tax-Exempt Receipts Series 1995 D (MBIA) (VMIG1)
$ 8,500,000 4.25% 01/07/99 $ 8,500,000
New York City Health & Hospitals Corp. Health System Bonds Series 1997 B
(Canadian Imperial Bank of Commerce) (A-1+/VMIG1)
600,000 3.95 01/07/99 600,000
New York City Transitional Finance Authority Future Tax Secured Bonds
Series 1999 A, Subseries A-1 (A-1+/VMIG1)
5,000,000 4.05 01/07/99 5,000,000
New York City Transitional Finance Authority Future Tax Secured Bonds
Series 1999 A, Subseries A-2 (A-1+/VMIG1)
10,000,000 3.90 01/07/99 10,000,000
New York State Environmental Facility Corp. RB Eagle Tax-Exempt Trust
Series 1994 D, Class A COPS (A-1+)
11,000,000 4.13 01/07/99 11,000,000
Syracuse University IDA RB for Syracuse University Eggers Hall Series 1993
(Morgan Guaranty Trust Co.) (A-1+/VMIG1)
2,600,000 5.00 01/04/99 2,600,000
- -----------------------------------------------------------------------------------------------
$ 104,500,000
- -----------------------------------------------------------------------------------------------
North Carolina--4.0%
Charlotte Variable Rate Airport Refunding RB Series 1993 A (MBIA)
(A-1+/VMIG1)
$ 1,500,000 3.85% 01/07/99 $ 1,500,000
City of Greensboro COPS Series 1998 (A-1+/VMIG1)
5,000,000 4.10 01/07/99 5,000,000
North Carolina State Public School Building Bonds Series 1998A Puttable
Floating Option Tax-Exempt Receipts Series PA 283 (A-1+)
8,750,000 4.10 01/07/99 8,750,000
Person County PCRB for Carolina Power & Light Series 1992 A (A-1/P-1)
16,400,000 4.10 01/07/99 16,400,000
Rockingham County Refunding PCRB for Philip Morris Project Series 1992 (A-
1/P-1)(b)
7,700,000 4.10 01/07/99 7,700,000
Wake County Industrial Facilities & Pollution Control Financing Authority
PCRB for Carolina Power & Light Series 1990 B (Bank of New York)(A-1+/P-
1)
7,000,000 3.15 03/11/99 7,000,000
10,000,000 2.90 03/23/99 10,000,000
10,000,000 2.90 03/24/99 10,000,000
- -----------------------------------------------------------------------------------------------
$ 66,350,000
- -----------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
21
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Ohio--0.8%
Columbus Electric System RB Series 1994 (Union Bank of Switzerland LOC)
(VMIG1)
$10,900,000 3.30% 02/01/99 $ 10,900,000
Hamilton County Adjustable Rate Hospital Facilities RB for the Health
Alliance of Greater Cincinnati Series 1997 B (MBIA) (A-1+/VMIG1)
2,800,000 4.00 01/07/99 2,800,000
- -----------------------------------------------------------------------------------------------
$ 13,700,000
- -----------------------------------------------------------------------------------------------
Oklahoma--1.4%
Muskogee Industrial Trust Pollution Control for Oklahoma Gas and Electric
Company Project Series 1997 A (A-1+/VMIG1)
$23,500,000 4.05% 01/07/99 $ 23,500,000
- -----------------------------------------------------------------------------------------------
Oregon--1.2%
Oregon Veterans Welfare VRDN Series 73 H (A-1+/VMIG1)
$19,300,000 4.10% 01/07/99 $ 19,300,000
- -----------------------------------------------------------------------------------------------
Pennsylvania--3.0%
Commonwealth of Pennsylvania GO Bonds First Series 1994 Eagle Tax-Exempt
Trust 943804/Class A COPS (AMBAC) (A-1C)
$15,030,000 4.15% 01/07/99 $ 15,030,000
Philadelphia City TRANS Series A 1998-1999 (SP-1+/MIG1)
31,625,000 4.25 06/30/99 31,757,203
Delaware County IDA PCRB for BP Oil, Inc. Project Series 1985
(A-1+/P-1)
4,300,000 5.00 01/04/99 4,300,000
- -----------------------------------------------------------------------------------------------
$ 51,087,203
- -----------------------------------------------------------------------------------------------
South Carolina--1.7%
Piedmont Municipal Power Agency Refunding RB Series 1996 C (MBIA) (A-
1+/VMIG1)
$20,000,000 3.85% 01/07/99 $ 20,000,000
York County Floating/Fixed Rate PCRB Pooled Series 1984-North Carolina
Electric Membership Corp. VRDN (NRU) (A-1+/VMIG1)
8,425,000 4.05 01/07/99 8,425,000
- -----------------------------------------------------------------------------------------------
$ 28,425,000
- -----------------------------------------------------------------------------------------------
Tennessee--0.1%
Blount County IDB PCRB for Aluminum Company of America Series 1992 (A-1)
$2,450,000 4.15% 01/07/99 $ 2,450,000
- -----------------------------------------------------------------------------------------------
Texas--13.2%
City of San Antonio Electric & Gas System Revenue RB Series 1997 SG 104,
SG 105 (A-1+C)
$20,200,000 4.10% 01/07/99 $ 20,200,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Texas (continued)
Coastal Bend Health Facilities Development Corp. for Incarnate Word Health
System RB Series 1998 B (AMBAC) (VMIG1)
$10,100,000 4.05% 01/07/99 $ 10,100,000
Coastal Bend Health Facilities Development Corp. RB Series 1997
(First National Bank of Chicago) (VMIG1)
1,000,000 4.00 01/07/99 1,000,000
Gulf Coast Waste Disposal Authority PCRB for Monsanto Series 1996 (P-1)
5,300,000 4.15 01/07/99 5,300,000
Gulf Coast Waste Disposal Authority PCRB Series 1992 (Amoco Corp.) (A-
1+/VMIG1)
9,575,000 5.10 01/04/99 9,575,000
Harris County Health Facilities Development Corp. RB for Memorial Hospital
System Series 1997 B (MBIA) (A-1+/VMIG1)
3,500,000 3.90 01/07/99 3,500,000
Harris County Health Facilities Development Corp. RB for Methodist
Hospital Series 1994 (A-1+)
5,000,000 5.00 01/04/99 5,000,000
Harris County Health Facilities Development Corp. Unit Priced Demand
Adjustable RB for St. Luke's Episcopal Hospital Series
1997 A (A-1+)
9,800,000 4.85 01/04/99 9,800,000
Harris County IDA PCRB for Exxon Corp. Series 1984 B (A-1+)
11,300,000 5.00 01/04/99 11,300,000
Harris County Toll Road VRDN Series 1994 E (A-1+/VMIG1)
10,700,000 3.95 01/07/99 10,700,000
Harris County Toll Road VRDN Series 1994 F (A-1+/VMIG1)
11,300,000 3.95 01/07/99 11,300,000
San Antonio Electric & Gas System CP Notes Series A (A-1+/P-1)
18,000,000 3.05 03/16/99 18,000,000
10,000,000 3.00 04/08/99 10,000,000
State of Texas TRANS Series 1997 B (A-1+/P-1)
14,000,000 2.95 07/28/99 14,000,000
14,000,000 2.95 08/23/99 14,000,000
State of Texas TRANS Series 1998 (SP-1+/MIG1)
56,000,000 4.50 08/31/99 56,539,392
Waco Health Facilities Development Corp. Variable Rate RB for Charity
Obligation Group Series 1997 E (A-1+/VMIG1)
4,800,000 3.90 01/07/99 4,800,000
West Side Calhoun County Development Corp. PCRB Series 1985
(A-1+/P-1)
5,800,000 5.00 01/04/99 5,800,000
- -----------------------------------------------------------------------------------------------
$ 220,914,392
- -----------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
22
<PAGE>
Statement of Investments
- --------------------------------------------------------------------------------
Financial Square Tax-Free Money Market Fund (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
Utah--1.9%
Central Utah Water Conservancy District GO Limited Tax Refunding Bonds
Variable Rate Tender Option Bonds Series 1998 F (AMBAC) (A-1+/VMIG1)
$ 6,000,000 3.95% 01/07/99 $ 6,000,000
Salt Lake County PCRB for Service Station/British Petroleum Series 1994 B
(A-1+)
6,800,000 5.00 01/04/99 6,800,000
Utah State Board of Regents Auxiliary and Campus Facilities System RB
Series 1997 A (A-1+/VMIG1)
18,690,000 3.75 01/07/99 18,690,000
- -----------------------------------------------------------------------------------------------
$ 31,490,000
- -----------------------------------------------------------------------------------------------
Virginia--3.5%
Chesterfield County IDA PCRB for Philip Morris Companies, Inc. Series 1992
(A-1/P-1)(b)
$14,700,000 4.10% 01/07/99 $ 14,700,000
Chesterfield County IDA PCRB for Virginia Electric & Power Series 1985 (A-
1/VMIG1)
8,000,000 3.10 01/15/99 8,000,000
Louisa PCRB for Virginia & Electric Power Series 1984 (A-1/VMIG1)
2,000,000 3.15 01/26/99 2,000,000
3,900,000 3.15 01/27/99 3,900,000
4,000,000 3.10 03/17/99 4,000,000
4,000,000 3.15 03/18/99 4,000,000
Roanoke City VRDN for Carilion Health System Hospital Series B (A-1/VMIG1)
6,600,000 5.00 01/04/99 6,600,000
York County IDA PCRB for Virginia Electric & Power Series 1985
(A-1/VMIG1)
5,600,000 3.10 01/15/99 5,600,000
9,000,000 3.00 02/01/99 9,000,000
- -----------------------------------------------------------------------------------------------
$ 57,800,000
- -----------------------------------------------------------------------------------------------
Washington--1.9%
King County Limited Tax GO Bonds Series 1994 A Eagle Tax-Exempt Trust
Series 97C 4701/Class A Certificates (A-1+C)
$ 5,410,000 4.13% 01/07/99 $ 5,410,000
King County Sewer Revenue BANS CP Series A (A-1/P-1)
14,100,000 3.05 03/18/99 14,100,000
Washington Health Care Facilities Authority VRDN for Hutchinson Cancer
Research Center Series 1991 A (Morgan Guaranty Trust LOC) (VMIG1)
6,075,000 5.30 01/04/99 6,075,000
</TABLE>
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------
Washington (continued)
Washington Health Care Facilities Authority VRDN for Fred Hutchinson
Cancer Research Center Series 1996 (Morgan Guaranty Trust LOC) (VMIG1)
$ 6,000,000 5.30% 01/04/99 $ 6,000,000
- ---------------------------------------------------------------------------------------------
$ 31,585,000
- ---------------------------------------------------------------------------------------------
Wisconsin--5.1%
City of Milwaukee Short-Term School Order Notes Series 1998 B
(SP-1+/MIG1)
$48,500,000 4.25% 08/26/99 $ 48,719,616
Milwaukee IDRB Multi-Modal for Pharmacia & Upjohn, Inc.
Series 1994 (P-1)
8,000,000 4.70 01/07/99 8,000,000
Milwaukee Metropolitan Sewage District GO Capital Purpose Bonds Series
1992 A Eagle Tax-Exempt Trust Series 944905 (A-1C)
10,300,000 4.15 01/07/99 10,300,000
State of Wisconsin Operating Notes Series 1998 (SP-1+/MIG1)
12,500,000 4.50 06/15/99 12,578,765
Wisconsin Health & Educational Facilities Authority VRDN for Wheaton
Franciscan Services Series 1997 (Toronto Dominion Bank) (A-1+/VMIG1)
6,575,000 4.00 01/07/99 6,575,000
- ---------------------------------------------------------------------------------------------
$ 86,173,381
- ---------------------------------------------------------------------------------------------
Wyoming--1.6%
Converse County PCRB for PacifiCorp Series 1994 (AMBAC) (A-1/VMIG1)
$ 4,690,000 5.00% 01/04/99 $ 4,690,000
Kemmerer PCRB for Exxon Project Series 1984 (A-1+)
9,400,000 5.10 01/04/99 9,400,000
Lincoln County PCRB for PacifiCorp Project Series 1994 (AMBAC)
(A-1/VMIG1)
4,100,000 5.00 01/04/99 4,100,000
Sweetwater PCRB for Idaho Power Co. Series 1996 C (A-1/VMIG1)
3,400,000 5.15 01/04/99 3,400,000
Uinta County PCRB for Chevron Project Series 1993 (P-1)
5,200,000 5.10 01/04/99 5,200,000
- ---------------------------------------------------------------------------------------------
$ 26,790,000
- ---------------------------------------------------------------------------------------------
Total Investments $1,706,482,755(c)
- ---------------------------------------------------------------------------------------------
</TABLE>
(a) Forward commitments.
(b) A portion of this security is segregated for forward commitments.
(c) The amount stated also represents aggregate cost for federal income
tax purposes.
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
23
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------------------------------------------------
Interest rates represent either the stated coupon rate, annualized yield on
date of purchase for discounted notes, or, for floating rate securities, the
current resent 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.
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.
- --------------------------------------------------------------------------------
Investment Abbreviations:
<TABLE>
<C> <S>
AMBAC --Insured by American Municipal Bond Assurance Corp.
COPS --Certificates of Participation
FGIC --Insured by Financial Guaranty Insurance Co.
FSA --Insured by Financial Security Assistance Co.
GO --General Obligation
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
NRU LOC --Insured by National Rural Utilities Cooperative Finance Corp.
PCRB --Pollution Control Revenue Bond
RB --Revenue Bond
TANS --Tax Anticipation Note
TRANS --Tax Revenue Anticipation Note
VRDN --Variable Rate Demand Note
- ------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
24
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Statements of Assets and Liabilities
December 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Prime Premium
Obligations Money Market Money Market
Fund Fund Fund
-----------------------------------
<S> <C> <C> <C>
Assets:
Investment in securities, at value
based on amortized cost $6,636,599,406 $6,085,098,505 $621,016,668
Cash 298,327 -- 80,748
Receivables:
Interest 27,706,012 33,999,989 2,181,794
Reimbursement from advisor 450,137 294,071 100,349
Deferred organization expenses, net -- 3,394 --
Other assets 84,694 13,758 --
- -------------------------------------------------------------------------------
Total assets 6,665,138,576 6,119,409,717 623,379,559
- -------------------------------------------------------------------------------
Liabilities:
Due to Bank -- 61,649 --
Payables:
Investment securities purchased -- 100,000,000 --
Income distribution 31,259,879 32,340,715 2,339,046
Management fee 1,114,213 1,131,543 81,432
Accrued expenses and other
liabilities 1,032,401 882,057 208,824
- -------------------------------------------------------------------------------
Total liabilities 33,406,493 134,415,964 2,629,302
- -------------------------------------------------------------------------------
Net Assets:
Paid-in capital 6,631,732,083 5,984,993,753 620,750,257
Accumulated undistributed net
investment income -- -- --
Accumulated net realized gain
(loss) on investment transactions -- -- --
- -------------------------------------------------------------------------------
Net assets $6,631,732,083 $5,984,993,753 $620,750,257
- -------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share
(net assets/shares outstanding) $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------
Shares outstanding:
FST shares 5,831,768,188 4,995,780,038 479,851,439
FST Preferred shares 132,561,671 93,218,173 107,516,022
FST Administration shares 331,197,822 399,471,260 13,727,829
FST Service shares 336,204,402 496,524,282 19,654,967
- -------------------------------------------------------------------------------
Total shares of beneficial interest
outstanding, $.001 par value
(unlimited number of shares
authorized) 6,631,732,083 5,984,993,753 620,750,257
- -------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
25
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Treasury Treasury Tax-Free
Obligations Instruments Government Federal Money Market
Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$5,400,245,358 $866,472,971 $3,092,844,155 $3,639,154,305 $1,706,482,755
3,332 27,082 14,592 4,901 762,747
11,441,856 -- 9,337,823 8,090,270 10,521,899
165,686 89,086 88,747 214,668 68,684
-- -- -- -- 8,495
18,445 1,084 -- 3,117 1,307
- --------------------------------------------------------------------------
5,411,874,677 866,590,223 3,102,285,317 3,647,467,261 1,717,845,887
- --------------------------------------------------------------------------
-- -- -- -- --
-- -- 172,826,151 247,824,722 38,380,000
21,345,388 3,278,932 11,985,692 14,253,493 4,276,340
785,788 131,417 430,250 498,403 236,180
1,041,214 167,150 696,073 704,865 279,077
- --------------------------------------------------------------------------
23,172,390 3,577,499 185,938,166 263,281,483 43,171,597
- --------------------------------------------------------------------------
5,388,702,287 863,008,071 2,916,347,151 3,384,185,270 1,674,687,909
-- -- -- -- --
-- 4,653 -- 508 (13,619)
- --------------------------------------------------------------------------
$5,388,702,287 $863,012,724 $2,916,347,151 $3,384,185,778 $1,674,674,290
- --------------------------------------------------------------------------
$1.00 $1.00 $1.00 $1.00 $1.00
- --------------------------------------------------------------------------
3,521,332,237 822,206,369 1,563,870,902 2,346,253,833 1,456,015,068
285,244,600 1,616 245,628,297 26,723,880 20,882,055
1,080,496,197 23,673,636 407,360,955 690,084,049 146,800,755
501,629,253 17,126,450 699,486,997 321,123,508 50,990,031
- --------------------------------------------------------------------------
5,388,702,287 863,008,071 2,916,347,151 3,384,185,270 1,674,687,909
- --------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
26
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Statements of Operations
For the Year Ended December 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Prime Premium
Obligations Money Market Money Market
Fund Fund Fund
----------------------------------------
<S> <C> <C> <C>
Investment income:
Interest $318,336,858 $338,553,940 $22,796,216
- -------------------------------------------------------------------------------
Expenses:
Management fees 11,710,577 12,445,772 843,317
Custodian fees 552,698 555,902 84,641
Registration fees 819,764 331,256 206,183
Professional fees 41,981 73,465 36,472
Trustee fees 35,073 36,175 10,931
Amortization of deferred organization
expenses -- 9,038 --
Service share fees 1,167,952 2,478,988 49,926
Administration share fees 832,405 947,740 20,162
Preferred share fees 156,506 76,867 102,701
Other 165,425 107,752 20,694
- -------------------------------------------------------------------------------
Total expenses 15,482,381 17,062,955 1,375,027
Less--expenses reimbursed and fees
waived by Goldman Sachs (2,956,784) (2,537,081) (534,957)
- -------------------------------------------------------------------------------
Net expenses 12,525,597 14,525,874 840,070
- -------------------------------------------------------------------------------
Net investment income 305,811,261 324,028,066 21,956,146
- -------------------------------------------------------------------------------
Net realized gain on investment
transactions 78,008 66,176 16,410
- -------------------------------------------------------------------------------
Net increase in net assets resulting
from operations $305,889,269 $324,094,242 $21,972,556
- -------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
27
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Treasury Treasury Tax-Free
Obligations Instruments Government Federal Money Market
Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$251,765,564 $21,275,471 $150,324,658 $137,467,745 $48,952,424
- ----------------------------------------------------------------------------
9,566,416 884,528 5,599,007 5,186,650 2,900,718
517,367 58,559 372,110 314,288 54,454
510,717 219,192 134,697 249,970 201,854
41,553 36,820 39,892 38,967 38,607
28,238 12,231 21,777 19,410 15,405
-- -- -- -- 15,585
2,019,235 97,057 3,225,643 1,312,961 254,984
2,373,198 49,689 845,644 951,754 360,347
307,604 -- 96,834 122,073 93,209
133,448 22,879 63,455 57,032 21,191
- ----------------------------------------------------------------------------
15,497,776 1,380,955 10,399,059 8,253,105 3,956,354
(2,327,675) (449,425) (1,275,663) (1,269,935) (678,201)
- ----------------------------------------------------------------------------
13,170,101 931,530 9,123,396 6,983,170 3,278,153
- ----------------------------------------------------------------------------
238,595,463 20,343,941 141,201,262 130,484,575 45,674,271
- ----------------------------------------------------------------------------
1,450,576 174,690 -- 31,979 1,321
- ----------------------------------------------------------------------------
$240,046,039 $20,518,631 $141,201,262 $130,516,554 $45,675,592
- ----------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
28
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
For the Year Ended December 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Prime Premium
Obligations Money Market Money Market
Fund Fund Fund
----------------------------------------
<S> <C> <C> <C>
From operations:
Net investment income $ 305,811,261 $ 324,028,066 $ 21,956,146
Net realized gain on
investment transactions 78,008 66,176 16,410
- ---------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 305,889,269 324,094,242 21,972,556
- ---------------------------------------------------------------------------------
Distributions to
shareholders from:
Net investment income
FST shares (269,081,520) (276,370,684) (15,650,407)
FST Preferred shares (8,232,389) (4,076,565) (5,432,663)
FST Administration shares (17,131,415) (19,556,691) (410,201)
FST Service shares (11,435,814) (24,091,684) (479,285)
- ---------------------------------------------------------------------------------
Total distributions to
shareholders (305,881,138) (324,095,624) (21,972,556)
- ---------------------------------------------------------------------------------
From share transactions (at
$1.00 per share):
Proceeds from sales of
shares 57,969,401,996 69,898,690,078 5,229,951,088
Reinvestment of dividends
and distributions 93,909,532 166,197,933 14,446,374
Cost of shares repurchased (55,869,833,965) (68,984,229,619) (4,844,668,494)
- ---------------------------------------------------------------------------------
Net increase in net assets
resulting from share
transactions 2,193,477,563 1,080,658,392 399,728,968
- ---------------------------------------------------------------------------------
Total increase 2,193,485,694 1,080,657,010 399,728,968
Net assets:
Beginning of year 4,438,246,389 4,904,336,743 221,021,289
- ---------------------------------------------------------------------------------
End of year $ 6,631,732,083 $ 5,984,993,753 $ 620,750,257
- ---------------------------------------------------------------------------------
Accumulated undistributed
net investment income -- -- --
- ---------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements.
29
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Treasury Treasury Tax-Free
Obligations Instruments Government Federal Money Market
Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 238,595,463 $ 20,343,941 $ 141,201,262 $ 130,484,575 $ 45,674,271
1,450,576 174,690 -- 31,979 1,321
- ----------------------------------------------------------------------------------------
240,046,039 20,518,631 141,201,262 130,516,554 45,675,592
- ----------------------------------------------------------------------------------------
(157,673,844) (18,729,601) (87,893,105) (92,448,326) (36,931,756)
(47,202,665) (78) (4,985,314) (6,428,582) (2,953,491)
(19,083,866) (927,699) (17,131,280) (19,097,019) (4,375,262)
(16,085,664) (857,978) (31,191,563) (12,542,759) (1,413,762)
- ----------------------------------------------------------------------------------------
(240,046,039) (20,515,356) (141,201,262) (130,516,686) (45,674,271)
- ----------------------------------------------------------------------------------------
53,000,555,348 3,317,001,578 29,790,708,579 14,894,751,480 9,696,660,958
91,114,922 8,446,401 37,971,285 64,289,412 19,443,237
(51,218,122,026) (2,983,195,546) (29,278,022,826) (13,748,692,419) (9,161,617,389)
- ----------------------------------------------------------------------------------------
1,873,548,244 342,252,433 550,657,038 1,210,348,473 554,486,806
- ----------------------------------------------------------------------------------------
1,873,548,244 342,255,708 550,657,038 1,210,348,341 554,488,127
3,515,154,043 520,757,016 2,365,690,113 2,173,837,437 1,120,186,163
- ----------------------------------------------------------------------------------------
$ 5,388,702,287 $ 863,012,724 $ 2,916,347,151 $ 3,384,185,778 $ 1,674,674,290
- ----------------------------------------------------------------------------------------
-- -- -- -- --
- ----------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
30
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
For the Year Ended December 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Prime Premium
Obligations Money Market Money Market
Fund Fund Fund(a)
--------------------------------------------------
<S> <C> <C> <C>
From operations:
Net investment income $ 277,979,593 $ 266,229,854 $ 4,194,052
Net realized gain (loss) on
investment transactions 15,992 32,849 --
- --------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 277,995,585 266,262,703 4,194,052
- --------------------------------------------------------------------------------
Distributions to
shareholders from:
Net investment income
FST shares (247,361,553) (231,700,902) (3,890,656)
FST Preferred shares (9,751,263) (3,010,280) (7,210)
FST Administration shares (13,824,313) (16,410,842) (295,011)
FST Service shares (7,042,464) (15,107,830) (1,175)
Net realized gain on
investment transactions
FST shares (22,695) (24,966) --
FST Preferred shares (752) (571) --
FST Administration shares (1,302) (31) --
FST Service shares (464) (6,853) --
- --------------------------------------------------------------------------------
Total distributions to
shareholders (278,004,806) (266,262,275) (4,194,052)
- --------------------------------------------------------------------------------
From share transactions (at
$1.00 per share):
Proceeds from sales of
shares 53,179,415,600 68,053,947,094 1,075,863,230
Reinvestment of dividends
and distributions 112,453,328 134,114,443 1,495,718
Cost of shares repurchased (53,213,589,524) (66,241,742,997) (856,337,659)
- --------------------------------------------------------------------------------
Net increase in net assets
resulting from share
transactions 78,279,404 1,946,318,540 221,021,289
- --------------------------------------------------------------------------------
Total increase 78,270,183 1,946,318,968 221,021,289
Net assets:
Beginning of period 4,359,976,206 2,958,017,775 --
- --------------------------------------------------------------------------------
End of period $ 4,438,246,389 $ 4,904,336,743 $ 221,021,289
- --------------------------------------------------------------------------------
Accumulated undistributed
net investment income -- -- --
- --------------------------------------------------------------------------------
</TABLE>
(a) Commencement dates of operations for the Premium Money Market, Treasury
Instruments and the Federal Fund were August 1, 1997, March 3, 1997 and
February 28, 1997, respectively.
- --------------------------------------- ---------------------------------------
The accompanying notes are an integral
part of these financial statements
31
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
Treasury Treasury Tax-Free
Obligations Instruments Government Federal Money Market
Fund Fund(a) Fund Fund(a) Fund
- ---------------------------------------------------------------------------------------
$ 165,098,980 $ 11,388,062 $ 110,081,406 $ 50,895,735 $ 28,536,346
300,712 89,851 127,727 (7,673) (2,081)
- ---------------------------------------------------------------------------------------
165,399,692 11,477,913 110,209,133 50,888,062 28,534,265
- ---------------------------------------------------------------------------------------
(112,020,839) (10,293,085) (70,362,803) (35,377,629) (23,828,347)
(5,711,597) (45) (1,492,230) (3,504,242) (542,008)
(35,669,978) (62,666) (13,365,067) (7,278,709) (3,161,663)
(11,696,566) (1,032,266) (24,861,306) (4,726,842) (1,004,328)
(253,465) (78,370) (94,763) -- --
(9,681) (1) (1,310) -- --
(92,228) (459) (15,668) -- --
(25,376) (9,643) (42,470) -- --
- ---------------------------------------------------------------------------------------
(165,479,730) (11,476,535) (110,235,617) (50,887,422) (28,536,346)
- ---------------------------------------------------------------------------------------
30,901,418,469 1,886,752,702 20,842,203,467 7,175,698,490 6,856,129,085
61,924,789 3,001,270 30,237,427 17,286,075 8,395,593
(30,543,252,110) (1,368,998,334) (19,734,267,186) (5,019,147,768) (6,285,421,492)
- ---------------------------------------------------------------------------------------
420,091,148 520,755,638 1,138,173,708 2,173,836,797 579,103,186
- ---------------------------------------------------------------------------------------
420,011,110 520,757,016 1,138,147,224 2,173,837,437 579,101,105
3,095,142,933 -- 1,227,542,889 -- 541,085,058
- ---------------------------------------------------------------------------------------
$ 3,515,154,043 $ 520,757,016 $ 2,365,690,113 $ 2,173,837,437 $ 1,120,186,163
- ---------------------------------------------------------------------------------------
-- -- -- $ 8,313 --
- ---------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
32
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Notes to Financial Statements
December 31, 1998
- --------------------------------------- ---------------------------------------
1. Organization
The Goldman Sachs Trust (the "Trust") is a Delaware business trust registered
under the Investment Company Act of 1940 (as amended) as an open-end management
investment company. The Trust includes the Financial Square Funds, collectively
"the Funds" or individually a "Fund". Financial Square consists of nine
diversified funds: Prime Obligations, Money Market, Premium Money Market,
Treasury Obligations, Treasury Instruments, Government, Federal, Tax-Free Money
Market and Municipal Money Market (inactive as of December 31, 1998). The
Financial Square Funds offer four classes of shares: FST shares, FST Preferred
shares, FST Administration shares and FST Service 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. In addition, the
Tax-Free Money Market Fund seeks to provide shareholders with a high level of
income exempt from federal income tax.
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, 1998 (tax year-end), the following fund had a capital loss
carryforward for U.S. Federal tax purposes of approximately:
<TABLE>
<CAPTION>
Years of
Fund Amount Expiration
---- ------- ----------
<S> <C> <C>
Tax-Free Money Market....................................... $11,000 2003-2005
</TABLE>
This amount is available to be carried forward to offset future capital gains
to the extent permitted by applicable laws or regulations.
D. Deferred Organization Expenses--
Organization-related costs are 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 generally allocated to the Funds based on the nature of the expense.
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 such shares.
- --------------------------------------- ---------------------------------------
33
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
3. Agreements
Goldman Sachs Asset Management ("GSAM"), a separate operating division of
Goldman, Sachs & Co. ("Goldman Sachs"), acts as investment adviser (the
"Adviser") pursuant to an Investment Management Agreement (the "Agreement").
Under the Agreement, GSAM, subject to general supervision by the Trust's Board
of Trustees, manages the Funds' portfolios and administers each Fund's business
affairs, including providing facilities. As compensation for the services
rendered under the 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.
For the year ended December 31, 1998, GSAM has voluntarily agreed to waive a
portion of its management fee. In addition, GSAM has limited certain of each of
the Fund's expenses (excluding management fees, service organization fees,
taxes, interest, brokerage commissions, litigation, indemnification and other
extraordinary expenses) to the extent that such expenses exceed .01% per annum
of each Fund's average daily net assets.
Goldman Sachs serves as Transfer Agent and Distributor of shares of the Funds
pursuant to Transfer Agent and Distribution Agreements and receives no separate
fee.
The following chart outlines the fee waivers and expense reimbursements for
the year ended December 31, 1998 (in thousands):
<TABLE>
<CAPTION>
Management
Fees Expense
Fund Waived Reimbursements Total
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Prime Obligations $2,000 $957 $2,957
- ------------------------------------------------------------------------------------------
Money Market 2,125 412 2,537
- ------------------------------------------------------------------------------------------
Premium Money Market 224 311 535
- ------------------------------------------------------------------------------------------
Treasury Obligations 1,633 695 2,328
- ------------------------------------------------------------------------------------------
Treasury Instruments 151 298 449
- ------------------------------------------------------------------------------------------
Government 956 320 1,276
- ------------------------------------------------------------------------------------------
Federal 886 384 1,270
- ------------------------------------------------------------------------------------------
Tax-Free Money Market 495 183 678
</TABLE>
4. Preferred, Administration and Service Plans
The Funds have adopted Preferred, Administration and Service 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.
- --------------------------------------- ---------------------------------------
34
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Notes to Financial Statements (continued)
December 31, 1998
- --------------------------------------- ---------------------------------------
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 total bank borrowings. The interest rate on the
borrowings is based on the Federal Funds rate. During the year ended December
31, 1998, 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.
At December 31, 1998, the Prime Obligations, Money Market, Premium Money
Market, Treasury Obligations and Government Funds had undivided interests in
the repurchase agreements held in the following joint account, which equaled
$201,300,000, $36,200,000, $182,800,000, $1,678,200,000 and $314,000,000 in
principal amount, respectively. At December 31, 1998, the repurchase agreements
held in this joint account were fully collateralized by U.S. Treasury
obligations.
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Donaldson, Lufkin & Jenrette, Inc.
$1,285,000,000 4.95% 01/04/1999 $1,285,000,000
Goldman, Sachs & Co.
500,000,000 4.75 01/04/1999 500,000,000
SBC Warburg Dillon Read Corp.
500,000,000 4.70 01/04/1999 500,000,000
1,098,400,000 4.75 01/04/1999 1,098,400,000
- -----------------------------------------------------------------------------------------------
Total Joint Repurchase Agreement Account $3,383,400,000
- -----------------------------------------------------------------------------------------------
</TABLE>
At December 31, 1998, the Prime Obligations, Premium Money Market, and
Government Funds had undivided interests in the repurchase agreements in the
following joint account II, which equaled $700,000,000 and $50,000,000, and
$200,000,000 in principal amount, respectively. At December 31, 1998, the
following repurchase agreements held in the following joint account were fully
collateralized by Federal Agency obligations.
<TABLE>
<CAPTION>
Principal Interest Maturity Amortized
Amount Rate Date Cost
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ABN/AMRO, Inc.
$120,000,000 5.15% 01/04/1999 $ 120,000,000
Deutsche Bank
77,300,000 5.07 01/04/1999 77,300,000
Donaldson, Lufkin & Jenrette, Inc.
150,000,000 4.95 01/04/1999 150,000,000
J.P. Morgan Securities, Inc.
700,000,000 4.75 01/04/1999 700,000,000
Morgan Stanley & Co.
200,000,000 4.95 01/04/1999 200,000,000
NationsBanc Montgomery Securities LLC
125,000,000 5.15 01/04/1999 125,000,000
- ---------------------------------------------------------------------------------------------
Total Joint Repurchase Agreement Account II $1,372,300,000
- ---------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
35
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
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 annual limitations as follows: 25% of eligible security
transactions, as defined, and 10% of repurchase agreement transactions.
9. Certain Reclassifications
In accordance with Statement of Position 93-2, the Financial Square Federal
Fund has reclassified $8,313 from accumulated undistributed net investment
income to accumulated net realized loss. This reclassification has no impact on
the net asset value of the Fund and is designed to present the Fund's capital
accounts on a tax basis.
- --------------------------------------- ---------------------------------------
36
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Notes to Financial Statements (continued)
December 31, 1998
- --------------------------------------------------------------------------------
10. Summary of Share Transactions (at $1.00 per share)
Share activity for the year ended December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Prime Premium
Obligations Money Market Money Market
Fund Fund Fund
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
FST shares:
Shares sold 50,577,781,681 64,642,205,884 4,885,235,788
Reinvestment of dividends
and distributions 81,013,084 145,091,154 9,694,829
Shares repurchased (48,694,767,051) (64,138,032,706) (4,633,271,570)
-----------------------------------------
1,964,027,714 649,264,332 261,659,047
- -------------------------------------------------------------------------------
FST Preferred shares:
Shares sold 1,635,375,108 587,335,211 212,622,508
Reinvestment of dividends
and distributions 1,663,959 3,560,753 4,477,152
Shares repurchased (1,657,247,424) (517,936,393) (110,141,465)
-----------------------------------------
(20,208,357) 72,959,571 106,958,195
- -------------------------------------------------------------------------------
FST Administration shares:
Shares sold 2,386,485,745 2,258,106,370 37,942,427
Reinvestment of dividends
and distributions 5,232,944 13,668,515 128,617
Shares repurchased (2,302,131,386) (2,093,556,998) (25,799,913)
-----------------------------------------
89,587,303 178,217,887 12,271,131
- -------------------------------------------------------------------------------
FST Service shares:
Shares sold 3,369,759,462 2,411,042,613 94,150,365
Reinvestment of dividends
and distributions 5,999,545 3,877,511 145,776
Shares repurchased (3,215,688,104) (2,234,703,522) (75,455,546)
-----------------------------------------
160,070,903 180,216,602 18,840,595
- -------------------------------------------------------------------------------
Net increase in shares 2,193,477,563 1,080,658,392 399,728,968
- -------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
37
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Treasury Treasury Tax-Free
Obligations Instruments Government Federal Money Market
Fund Fund Fund Fund Fund
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
38,811,128,138 3,155,786,943 19,929,403,199 10,287,288,538 8,343,229,377
53,825,326 7,667,006 28,357,386 45,213,214 17,430,024
(37,561,525,035) (2,837,666,325) (19,872,424,728) (9,111,928,825) (7,844,065,473)
- -----------------------------------------------------------------------------------
1,303,428,429 325,787,624 85,335,857 1,220,572,927 516,593,928
- -----------------------------------------------------------------------------------
2,747,117,320 -- 1,063,864,036 138,883,456 451,367,441
6,885,153 77 2,648,231 7,188,094 155,091
(2,714,118,870) -- (828,030,762) (313,722,647) (465,792,140)
- -----------------------------------------------------------------------------------
39,883,603 77 238,481,505 (167,651,097) (14,269,608)
- -----------------------------------------------------------------------------------
5,954,832,820 69,117,817 5,103,623,628 2,165,279,603 557,825,919
16,115,116 770,968 4,155,641 6,022,375 1,389,127
(5,629,346,838) (50,374,164) (5,000,220,220) (2,106,551,874) (515,464,054)
- -----------------------------------------------------------------------------------
341,601,098 19,514,621 107,559,049 64,750,104 43,750,992
- -----------------------------------------------------------------------------------
5,487,477,070 92,096,818 3,693,817,716 2,303,299,883 344,238,221
14,289,327 8,350 2,810,027 5,865,729 468,995
(5,313,131,283) (95,155,057) (3,577,347,116) (2,216,489,073) (336,295,722)
- -----------------------------------------------------------------------------------
188,635,114 (3,049,889) 119,280,627 92,676,539 8,411,494
- -----------------------------------------------------------------------------------
1,873,548,244 342,252,433 550,657,038 1,210,348,473 554,486,806
- -----------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
38
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Notes to Financial Statements (continued)
December 31, 1998
- --------------------------------------------------------------------------------
10. Summary of Share Transactions (at $1.00 per share) (continued)
Share activity for the year ended December 31, 1997 is as follows:
<TABLE>
<CAPTION>
Prime Premium
Obligations Money Market Money Market
Fund Fund Fund(a)
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
FST shares:
Shares sold 47,147,215,061 63,982,789,001 1,031,854,202
Reinvestment of dividends
and distributions 103,377,234 118,914,805 1,491,071
Shares repurchased (47,284,643,891) (62,295,549,107) (815,152,881)
----------------------------------------
(34,051,596) 1,806,154,699 218,192,392
- ------------------------------------------------------------------------------
FST Preferred shares:
Shares sold 1,624,299,212 754,498,086 553,233
Reinvestment of dividends
and distributions 1,010,173 1,861,300 4,594
Shares repurchased (1,599,668,091) (753,611,334) --
----------------------------------------
25,641,294 2,748,052 557,827
- ------------------------------------------------------------------------------
FST Administration shares:
Shares sold 2,052,177,068 2,237,080,367 42,641,449
Reinvestment of dividends
and distributions 4,016,672 11,388,582 27
Shares repurchased (2,030,483,474) (2,192,980,303) (41,184,778)
----------------------------------------
25,710,266 55,488,646 1,456,698
- ------------------------------------------------------------------------------
FST Service shares:
Shares sold 2,355,724,259 1,079,579,640 814,346
Reinvestment of dividends
and distributions 4,049,249 1,949,756 26
Shares repurchased (2,298,794,068) (999,602,253) --
----------------------------------------
60,979,440 81,927,143 814,372
- ------------------------------------------------------------------------------
Net increase in shares 78,279,404 1,946,318,540 221,021,289
- ------------------------------------------------------------------------------
</TABLE>
(a) Commencement date of operations for the Premium Money Market, Treasury
Instruments and the Federal Fund was August 1, 1997, March 3, 1997 and
February 28, 1997, respectively.
- --------------------------------------- ---------------------------------------
39
<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>
21,293,469,586 1,757,063,242 16,068,538,976 4,332,722,729 6,019,992,055
39,794,793 2,990,503 25,573,363 11,815,388 6,844,739
(21,406,328,023) (1,263,635,000) (15,474,321,199) (3,218,857,211) (5,528,265,772)
- -----------------------------------------------------------------------------------
(73,063,644) 496,418,745 619,791,140 1,125,680,906 498,571,022
- -----------------------------------------------------------------------------------
1,389,183,384 1,500 141,301,549 300,365,996 271,642,865
1,089,957 39 164,952 2,470,479 87,192
(1,191,548,937) -- (134,432,139) (108,461,498) (265,308,952)
- -----------------------------------------------------------------------------------
198,724,404 1,539 7,034,362 194,374,977 6,421,105
- -----------------------------------------------------------------------------------
5,271,440,356 9,051,015 2,286,537,497 1,298,319,389 271,268,796
12,077,349 5,093 2,533,048 1,136,485 865,271
(5,081,525,991) (4,897,093) (2,134,371,808) (674,121,929) (220,746,099)
- -----------------------------------------------------------------------------------
201,991,714 4,159,015 154,698,737 625,333,945 51,387,968
- -----------------------------------------------------------------------------------
2,947,325,143 120,636,945 2,345,825,445 1,244,406,778 293,225,369
8,962,690 5,635 1,966,064 1,747,321 598,391
(2,863,849,159) (100,466,241) (1,991,142,040) (1,017,707,130) (271,100,669)
- -----------------------------------------------------------------------------------
92,438,674 20,176,339 356,649,469 228,446,969 22,723,091
- -----------------------------------------------------------------------------------
420,091,148 520,755,638 1,138,173,708 2,173,836,797 579,103,186
- -----------------------------------------------------------------------------------
</TABLE>
- --------------------------------------- ---------------------------------------
40
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights
Selected Data for a Share Outstanding Throughout Each Period
Prime Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Ratio of net
Net asset Net asset assets at Ratio of net investment
value at Net Distributions value at end expenses to income to
beginning investment to end Total of period average net average net
of period income(a) shareholders of period return(b) (in 000's) assets assets
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.55% $5,831,773 0.18% 5.39%
1998-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.45 132,558 0.28 5.26
1998-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.29 331,196 0.43 5.14
1998-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.03 336,205 0.68 4.89
- --------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.60 3,867,739 0.18 5.46
1997-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.50 152,767 0.28 5.38
1997-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.34 241,607 0.43 5.22
1997-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.08 176,133 0.68 4.97
- --------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.41 3,901,797 0.18 5.29
1996-FST Pre-
ferred Shares
(commenced May
1).............. 1.00 0.03 (0.03) 1.00 5.28(c) 127,126 0.28(c) 5.19(c)
1996-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.14 215,898 0.43 5.06
1996-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.88 115,114 0.68 4.78
- --------------------------------------------------------------------------------------------------------------
1995-FST
shares.......... 1.00 0.06 (0.06) 1.00 6.02 3,295,791 0.18 5.86
1995-FST Admin-
istration
shares.......... 1.00 0.06 (0.06) 1.00 5.75 147,894 0.43 5.59
1995-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.49 65,278 0.68 5.33
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,(d)
- ------------------------------------
1994-FST
shares.......... 1.00 0.04 (0.04) 1.00 4.38(c) 2,774,849 0.18(c) 4.38(c)
1994-FST Pre-
ferred Shares... 1.00 0.04 (0.04) 1.00 4.12(c) 66,113 0.43(c) 4.18(c)
1994-FST Service
shares.......... 1.00 0.04 (0.04) 1.00 3.86(c) 41,372 0.68(c) 3.98(c)
- --------------------------------------------------------------------------------------------------------------
For the Years Ended January 31,
- -------------------------------
1994-FST
shares.......... 1.00 0.03 (0.03) 1.00 3.18 1,831,413 0.17 3.11
1994-FST Admin-
istration
shares.......... 1.00 0.03 (0.03) 1.00 2.92 35,250 0.42 2.86
1994-FST Service
shares.......... 1.00 0.03 (0.03) 1.00 2.66 14,001 0.67 2.61
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
------------------------------------------------------------------------------------------
<S> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... 0.24% 5.33%
1998-FST Pre-
ferred shares... 0.34 5.20
1998-FST Admin-
istration
shares.......... 0.49 5.08
1998-FST Service
shares.......... 0.74 4.83
- --------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 0.23 5.41
1997-FST Pre-
ferred shares... 0.33 5.33
1997-FST Admin-
istration
shares.......... 0.48 5.17
1997-FST Service
shares.......... 0.73 4.92
- --------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 0.23 5.24
1996-FST Pre-
ferred Shares
(commenced May
1).............. 0.33(c) 5.14(c)
1996-FST Admin-
istration
shares.......... 0.48 5.01
1996-FST Service
shares.......... 0.73 4.73
- --------------------------------------------------------------------------------------------------------------
1995-FST
shares.......... 0.22 5.82
1995-FST Admin-
istration
shares.......... 0.47 5.55
1995-FST Service
shares.......... 0.72 5.29
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,(d)
- ------------------------------------
1994-FST
shares.......... 0.24(c) 4.32(c)
1994-FST Pre-
ferred Shares... 0.49(c) 4.12(c)
1994-FST Service
shares.......... 0.74(c) 3.92(c)
- --------------------------------------------------------------------------------------------------------------
For the Years Ended January 31,
- -------------------------------
1994-FST
shares.......... 0.25 3.03
1994-FST Admin-
istration
shares.......... 0.50 2.78
1994-FST Service
shares.......... 0.75 2.53
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
(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 Trust (formerly Goldman Sachs Money
Market Trust).
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
41
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights (continued)
Selected Data for a Share Outstanding Throughout Each Period
Money Market Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Ratio of net
Net asset Net asset assets at Ratio of net investment
value at Net Distributions value at end expenses to income to
beginning investment to end Total of period average net average net
of period income(a) shareholders of period return(b) (in 000's) assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.55% $4,995,782 0.18% 5.40%
1998-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.45 93,218 0.28 5.30
1998-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.29 399,474 0.43 5.16
1998-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.03 496,520 0.68 4.86
- --------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 1.00 0.06 (0.06) 1.00 5.63 4,346,519 0.18 5.50
1997-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.53 20,258 0.28 5.44
1997-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.37 221,256 0.43 5.26
1997-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.11 316,304 0.68 4.99
- --------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.45 2,540,366 0.18 5.33
1996-FST Pre-
ferred shares
(commenced May
1).............. 1.00 0.03 (0.03) 1.00 5.31(c) 17,510 0.28(c) 5.23(c)
1996-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.19 165,766 0.43 5.04
1996-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.93 234,376 0.68 4.84
- --------------------------------------------------------------------------------------------------------------
1995-FST
Shares.......... 1.00 0.06 (0.06) 1.00 6.07 2,069,197 0.15 5.89
1995-FST Admin-
istration
shares.......... 1.00 0.06 (0.06) 1.00 5.80 137,412 0.40 5.61
1995-FST Service
shares
(commenced
July 14)........ 1.00 0.02 (0.02) 1.00 5.41(c) 4,219 0.65(c) 4.93(c)
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1994-FST shares
(commenced May
18)............. 1.00 0.03 (0.03) 1.00 4.91(c) 862,971 0.11(c) 4.88(c)
1994-FST Admin-
istration shares
(commenced May
20)............. 1.00 0.03 (0.03) 1.00 4.65(c) 66,560 0.36(c) 4.82(c)
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... 0.23% 5.35%
1998-FST Pre-
ferred shares... 0.33 5.25
1998-FST Admin-
istration
shares.......... 0.48 5.11
1998-FST Service
shares.......... 0.73 4.81
- --------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 0.23 5.45
1997-FST Pre-
ferred shares... 0.33 5.39
1997-FST Admin-
istration
shares.......... 0.48 5.21
1997-FST Service
shares.......... 0.73 4.94
- --------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 0.23 5.28
1996-FST Pre-
ferred shares
(commenced May
1).............. 0.33(c) 5.18(c)
1996-FST Admin-
istration
shares.......... 0.48 4.99
1996-FST Service
shares.......... 0.73 4.79
- --------------------------------------------------------------------------------------------------------------
1995-FST
Shares.......... 0.23 5.81
1995-FST Admin-
istration
shares.......... 0.48 5.53
1995-FST Service
shares
(commenced
July 14)........ 0.73(c) 4.85(c)
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1994-FST shares
(commenced May
18)............. 0.25(c) 4.74(c)
1994-FST Admin-
istration shares
(commenced May
20)............. 0.50(c) 4.68(c)
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
42
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights (continued)
Selected Data for a Share Outstanding Throughout Each Period
Premium Money Market Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net
assets at Ratio of net
Net asset Net asset end Ratio of net investment
value at Net Distributions value at of period expenses to income to
beginning investment to end Total (in average net average net
of period income(a) shareholders of period return(b) 000's) assets assets
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Year Ended December 31,
- -------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.55% $479,851 0.16% 5.38%
1998-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.45 107,517 0.26 5.29
1998-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.29 13,728 0.41 5.08
1998-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.03 19,655 0.66 4.79
- ------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1997-FST shares
(commenced
August 1)....... 1.00 0.02 (0.02) 1.00 5.73(c) 218,192 0.08(c) 5.59(c)
1997-FST
Preferred Shares
(commenced
August 1)....... 1.00 0.02 (0.02) 1.00 5.62(c) 558 0.18(c) 5.50(c)
1997-FST
Administration
shares
(commenced
August 1)....... 1.00 0.02 (0.02) 1.00 5.47(c) 1,457 0.33(c) 5.33(c)
1997-FST Service
shares
(commenced
August 1)....... 1.00 0.02 (0.02) 1.00 5.20(c) 814 0.58(c) 5.17(c)
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
------------------------------------------------------------------------------------------
<S> <C> <C>
For the Year Ended December 31,
- -------------------------------
1998-FST
shares.......... 0.29% 5.25%
1998-FST Pre-
ferred shares... 0.39 5.16
1998-FST Admin-
istration
shares.......... 0.54 4.95
1998-FST Service
shares.......... 0.79 4.66
- ------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1997-FST shares
(commenced
August 1)....... 0.43(c) 5.24(c)
1997-FST
Preferred Shares
(commenced
August 1)....... 0.53(c) 5.15(c)
1997-FST
Administration
shares
(commenced
August 1)....... 0.68(c) 4.98(c)
1997-FST Service
shares
(commenced
August 1)....... 0.93(c) 4.82(c)
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
43
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Obligations Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Ratio of net
Net asset Net asset assets at Ratio of net investment
value at Net Distributions value at end expenses to income to
beginning investment to end Total of period average net average net
of period income(a) shareholders of period return(b) (in 000's) assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.40% $3,521,389 0.18% 5.22%
1998-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.29 285,240 0.28 5.20
1998-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.14 1,080,454 0.43 4.94
1998-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.87 501,619 0.68 4.69
- ---------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.50 2,217,943 0.18 5.36
1997-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.40 245,355 0.28 5.32
1997-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.24 738,865 0.43 5.12
1997-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.98 312,991 0.68 4.87
- ---------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.35 2,291,051 0.18 5.22
1996-FST Pre-
ferred
shares (commenced
May 1).......... 1.00 0.03 (0.03) 1.00 5.24(c) 46,637 0.28(c) 5.11(c)
1996-FST Admin-
istration shares
................ 1.00 0.05 (0.05) 1.00 5.09 536,895 0.43 4.97
1996-FST Service
shares ......... 1.00 0.05 (0.05) 1.00 4.83 220,560 0.68 4.72
- ---------------------------------------------------------------------------------------------------------------
1995-FST shares
................ 1.00 0.06 (0.06) 1.00 5.96 1,587,715 0.18 5.73
1995-FST Admin-
istration shares
................ 1.00 0.06 (0.06) 1.00 5.69 283,186 0.43 5.47
1995-FST Service
shares ......... 1.00 0.05 (0.05) 1.00 5.43 139,117 0.68 5.21
- ---------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,(d)
- ------------------------------------
1994-FST
shares ......... 1.00 0.04 (0.04) 1.00 4.23(c) 958,196 0.18(c) 4.13(c)
1994-FST Admin-
istration
shares ......... 1.00 0.04 (0.04) 1.00 3.97(c) 82,124 0.43(c) 4.24(c)
1994-FST Service
shares ......... 1.00 0.03 (0.03) 1.00 3.71(c) 81,162 0.68(c) 3.82(c)
- ---------------------------------------------------------------------------------------------------------------
For the Year Ended January 31,
- ------------------------------
1994-FST
shares.......... 1.00 0.03 (0.03) 1.00 3.11 812,420 0.17 3.01
1994-FST Admin-
istration shares
................ 1.00 0.03 (0.03) 1.00 2.85 24,485 0.42 2.76
1994-FST Service
shares ......... 1.00 0.03 (0.03) 1.00 2.60 35,656 0.67 2.51
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... 0.23% 5.17%
1998-FST Pre-
ferred shares... 0.33 5.15
1998-FST Admin-
istration
shares.......... 0.48 4.89
1998-FST Service
shares.......... 0.73 4.64
- ---------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 0.23 5.31
1997-FST Pre-
ferred shares... 0.33 5.27
1997-FST Admin-
istration
shares.......... 0.48 5.07
1997-FST Service
shares.......... 0.73 4.82
- ---------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 0.24 5.16
1996-FST Pre-
ferred
shares (commenced
May 1).......... 0.34(c) 5.05(c)
1996-FST Admin-
istration shares
................ 0.49 4.91
1996-FST Service
shares ......... 0.74 4.66
- ---------------------------------------------------------------------------------------------------------------
1995-FST shares
................ 0.23 5.68
1995-FST Admin-
istration shares
................ 0.48 5.42
1995-FST Service
shares ......... 0.73 5.16
- ---------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,(d)
- ------------------------------------
1994-FST
shares ......... 0.25(c) 4.06(c)
1994-FST Admin-
istration
shares ......... 0.50(c) 4.17(c)
1994-FST Service
shares ......... 0.75(c) 3.75(c)
- ---------------------------------------------------------------------------------------------------------------
For the Year Ended January 31,
- ------------------------------
1994-FST
shares.......... 0.24 2.94
1994-FST Admin-
istration shares
................ 0.49 2.69
1994-FST Service
shares ......... 0.74 2.44
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
(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 Trust (formerly Goldman Sachs Money
Market Trust).
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
44
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights (continued)
Selected Data for a Share Outstanding Throughout Each Period
Treasury Instruments Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net
assets at Ratio of net
Net asset Net asset end Ratio of net investment
value at Net Distributions value at of period expenses to income to
beginning investment to end Total (in average net average net
of period income(a) shareholders of period return(b) 000's) assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Year Ended December 31,
- -------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.05% $822,207 0.18% 4.74%
1998-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 4.94 2 0.28 4.68
1998-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 4.79 23,676 0.43 4.62
1998-FST Service
shares.......... 1.00 0.04 (0.04) 1.00 4.53 17,128 0.68 4.37
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1997-FST
shares (commenced
March 3)........ 1.00 0.04 (0.04) 1.00 5.25(c) 496,419 0.18(c) 5.09(c)
1997-FST Pre-
ferred shares
(commenced
May 30)......... 1.00 0.03 (0.03) 1.00 5.13(c) 2 0.28(c) 5.00(c)
1997-FST Admin-
istration shares
(commenced
April 1)........ 1.00 0.04 (0.04) 1.00 4.99(c) 4,159 0.43(c) 4.84(c)
1997-FST Service
shares (com-
menced
March 5)........ 1.00 0.04 (0.04) 1.00 4.71(c) 20,177 0.68(c) 4.62(c)
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C>
For the Year Ended December 31,
- -------------------------------
1998-FST
shares.......... 0.29% 4.63%
1998-FST Pre-
ferred shares... 0.39 4.57
1998-FST Admin-
istration
shares.......... 0.54 4.51
1998-FST Service
shares.......... 0.79 4.26
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1997-FST
shares (commenced
March 3)........ 0.29(c) 4.98(c)
1997-FST Pre-
ferred shares
(commenced
May 30)......... 0.39(c) 4.89(c)
1997-FST Admin-
istration shares
(commenced
April 1)........ 0.54(c) 4.73(c)
1997-FST Service
shares (com-
menced
March 5)........ 0.79(c) 4.51(c)
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
45
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights (continued)
Selected Data for a Share Outstanding Throughout Each Period
Government Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Ratio of net
Net asset Net asset assets at Ratio of net investment
value at Net Distributions value at end expenses to income to
beginning investment to end Total of period average net average net
of period income(a) shareholders of period return(b) (in 000's) assets assets
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.46% $1,563,875 0.18% 5.32%
1998-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.36 245,628 0.28 5.15
1998-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.20 407,363 0.43 5.06
1998-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.94 699,481 0.68 4.83
- -----------------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.54 1,478,539 0.18 5.41
1997-FST Pre-
ferred shares... 1.00 0.05 (0.05) 1.00 5.43 7,147 0.28 5.34
1997-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.28 299,804 0.43 5.15
1997-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 5.02 580,200 0.68 4.91
- -----------------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 1.00 0.05 (0.05) 1.00 5.38 858,769 0.18 5.25
1996-FST Pre-
ferred shares
(commenced May
1).............. 1.00 0.03 (0.03) 1.00 5.26(c) 112 0.28(c) 5.14(c)
1996-FST Admin-
istration
shares.......... 1.00 0.05 (0.05) 1.00 5.12 145,108 0.43 5.01
1996-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.86 223,554 0.68 4.74
- -----------------------------------------------------------------------------------------------------------------------
1995-FST
shares.......... 1.00 0.06 (0.06) 1.00 6.00 743,884 0.18 5.81
1995-FST Admin-
istration
shares.......... 1.00 0.06 (0.06) 1.00 5.74 82,386 0.43 5.54
1995-FST Service
shares (com-
menced May 16).. 1.00 0.03 (0.03) 1.00 5.40(c) 14,508 0.68(c) 5.08(c)
- -----------------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,(d)
- ------------------------------------
1994-FST
shares.......... 1.00 0.04 (0.04) 1.00 4.36(c) 258,350 0.15(c) 4.64(c)
1994-FST Admin-
istration
shares.......... 1.00 0.04 (0.04) 1.00 4.10(c) 54,253 0.40(c) 4.67(c)
- -----------------------------------------------------------------------------------------------------------------------
For the Period Ended January 31,
- --------------------------------
1993-FST shares
(commenced April
6).............. 1.00 0.03 (0.03) 1.00 3.14(c) 44,697 0.08(c) 3.10(c)
1993-FST
Administration
shares
(commenced September 1).. 1.00 0.01 (0.01) 1.00 2.87(c) 14,126 0.35(c) 2.85(c)
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
--------------------------------------------------------------------------------------------------
<S> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... 0.23% 5.27%
1998-FST Pre-
ferred shares... 0.33 5.10
1998-FST Admin-
istration
shares.......... 0.48 5.01
1998-FST Service
shares.......... 0.73 4.78
- -----------------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 0.24 5.35
1997-FST Pre-
ferred shares... 0.34 5.28
1997-FST Admin-
istration
shares.......... 0.49 5.09
1997-FST Service
shares.......... 0.74 4.85
- -----------------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 0.24 5.19
1996-FST Pre-
ferred shares
(commenced May
1).............. 0.34(c) 5.08(c)
1996-FST Admin-
istration
shares.......... 0.49 4.95
1996-FST Service
shares.......... 0.74 4.68
- -----------------------------------------------------------------------------------------------------------------------
1995-FST
shares.......... 0.24 5.75
1995-FST Admin-
istration
shares.......... 0.49 5.48
1995-FST Service
shares (com-
menced May 16).. 0.74(c) 5.02(c)
- -----------------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,(d)
- ------------------------------------
1994-FST
shares.......... 0.25(c) 4.54(c)
1994-FST Admin-
istration
shares.......... 0.50(c) 4.57(c)
- -----------------------------------------------------------------------------------------------------------------------
For the Period Ended January 31,
- --------------------------------
1993-FST shares
(commenced April
6).............. 0.59(c) 2.59(c)
1993-FST
Administration
shares
(commenced September 1).. 0.76(c) 2.44(c)
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
(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 Trust (formerly Goldman Sachs Money
Market Trust).
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
46
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- -------------------------------------------------------------------------------
Financial Highlights (continued)
Selected Data for a Share Outstanding Throughout Each Period
Federal Fund
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Ratio of net
Net Asset Net asset assets at Ratio of net investment
value at Net Distributions value at end expenses to income to
beginning investment to end Total of period average net average net
of period income(a) shareholders of period return(b) (in 000's) assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Year Ended December 31,
- -------------------------------
1998-FST
shares.......... $1.00 $0.05 $(0.05) $1.00 5.41% $2,346,254 0.18% 5.24%
1998-FST
Preferred
shares.......... 1.00 0.05 (0.05) 1.00 5.31 26,724 0.28 5.20
1998-FST
Administration
shares.......... 1.00 0.05 (0.05) 1.00 5.15 690,084 0.43 5.02
1998-FST Service
shares.......... 1.00 0.05 (0.05) 1.00 4.89 321,124 0.68 4.78
- -------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1997-FST shares
(commenced
February 28).... 1.00 0.05 (0.05) 1.00 5.51(c) 1,125,681 0.18(c) 5.39(c)
1997-FST
Preferred shares
(commenced May
30)............. 1.00 0.03 (0.03) 1.00 5.43(c) 194,375 0.28(c) 5.26(c)
1997-FST
Administration
shares
(commenced April
1).............. 1.00 0.04 (0.04) 1.00 5.27(c) 625,334 0.43(c) 5.15(c)
1997-FST Service
shares
(commenced March
25)............. 1.00 0.04 (0.04) 1.00 5.00(c) 228,447 0.68(c) 4.78(c)
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
-------------------------------------------------------------------------------------------
<S> <C> <C>
For the Year Ended December 31,
- -------------------------------
1998-FST
shares.......... 0.24% 5.18%
1998-FST
Preferred
shares.......... 0.34 5.14
1998-FST
Administration
shares.......... 0.49 4.96
1998-FST Service
shares.......... 0.74 4.72
- -------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1997-FST shares
(commenced
February 28).... 0.27(c) 5.30(c)
1997-FST
Preferred shares
(commenced May
30)............. 0.37(c) 5.17(c)
1997-FST
Administration
shares
(commenced April
1).............. 0.52(c) 5.06(c)
1997-FST Service
shares
(commenced March
25)............. 0.77(c) 4.69(c)
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
47
<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>
Net Ratio of net
Net asset Net asset assets at Ratio of net investment
value at Net Distributions value at end expenses to income to
beginning investment to end Total of period average net average net
of period income(a) shareholders of period return(b) (in 000's) assets assets
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... $1.00 $0.03 $(0.03) $1.00 3.34% $1,456,002 0.18% 3.28%
1998-FST Pre-
ferred shares... 1.00 0.03 (0.03) 1.00 3.24 20,882 0.28 3.17
1998-FST Admin-
istration
shares.......... 1.00 0.03 (0.03) 1.00 3.08 146,800 0.43 3.04
1998-FST Service
shares.......... 1.00 0.03 (0.03) 1.00 2.83 50,990 0.68 2.77
- --------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 1.00 0.04 (0.04) 1.00 3.54 939,407 0.18 3.50
1997-FST Pre-
ferred shares... 1.00 0.03 (0.03) 1.00 3.43 35,152 0.28 3.39
1997-FST Admin-
istration
shares.......... 1.00 0.03 (0.03) 1.00 3.28 103,049 0.43 3.27
1997-FST Service
shares.......... 1.00 0.03 (0.03) 1.00 3.02 42,578 0.68 3.01
- --------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 1.00 0.03 (0.03) 1.00 3.39 440,838 0.18 3.35
1996-FST Pre-
ferred shares
(commenced May
1).............. 1.00 0.02 (0.02) 1.00 3.30(c) 28,731 0.28(c) 3.26(c)
1996-FST Admin-
istration shares
................ 1.00 0.03 (0.03) 1.00 3.13 51,661 0.43 3.10
1996-FST Service
shares.......... 1.00 0.03 (0.03) 1.00 2.88 19,855 0.68 2.85
- --------------------------------------------------------------------------------------------------------------
1995-FST
shares.......... 1.00 0.04 (0.04) 1.00 3.89 448,367 0.14 3.81
1995-FST Admin-
istration
shares.......... 1.00 0.04 (0.04) 1.00 3.63 20,939 0.39 3.54
1995-FST Service
shares.......... 1.00 0.03 (0.03) 1.00 3.38 19,860 0.64 3.32
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1994-FST shares
(commenced July
19)............. 1.00 0.02 (0.02) 1.00 3.41(c) 183,570 0.07(c) 3.42(c)
1994-FST Admin-
istration shares
(commenced Au-
gust 1)......... 1.00 0.01 (0.01) 1.00 3.19(c) 2,042 0.32(c) 3.25(c)
1994-FST Service
shares (com-
menced September
23)............. 1.00 0.01 (0.01) 1.00 3.11(c) 2,267 0.57(c) 3.32(c)
<CAPTION>
Ratios assuming no
waiver of fees and no
expense limitations
------------------------
Ratio of net
Ratio of investment
expenses to income to
average net average net
assets assets
------------------------------------------------------------------------------------------
<S> <C> <C>
For the Years Ended December 31,
- --------------------------------
1998-FST
shares.......... 0.23% 3.23%
1998-FST Pre-
ferred shares... 0.33 3.12
1998-FST Admin-
istration
shares.......... 0.48 2.99
1998-FST Service
shares.......... 0.73 2.72
- --------------------------------------------------------------------------------------------------------------
1997-FST
shares.......... 0.24 3.44
1997-FST Pre-
ferred shares... 0.34 3.33
1997-FST Admin-
istration
shares.......... 0.49 3.21
1997-FST Service
shares.......... 0.74 2.95
- --------------------------------------------------------------------------------------------------------------
1996-FST
shares.......... 0.23 3.30
1996-FST Pre-
ferred shares
(commenced May
1).............. 0.33(c) 3.21(c)
1996-FST Admin-
istration shares
................ 0.48 3.05
1996-FST Service
shares.......... 0.73 2.80
- --------------------------------------------------------------------------------------------------------------
1995-FST
shares.......... 0.24 3.71
1995-FST Admin-
istration
shares.......... 0.49 3.44
1995-FST Service
shares.......... 0.74 3.22
- --------------------------------------------------------------------------------------------------------------
For the Period Ended December 31,
- ---------------------------------
1994-FST shares
(commenced July
19)............. 0.31(c) 3.18(c)
1994-FST Admin-
istration shares
(commenced Au-
gust 1)......... 0.56(c) 3.01(c)
1994-FST Service
shares (com-
menced September
23)............. 0.81(c) 3.08(c)
</TABLE>
- ----
(a) Calculated based on the average shares outstanding methodology.
(b) 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.
(c) Annualized.
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
48
<PAGE>
Goldman Sachs Trust--Financial Square Funds
- --------------------------------------------------------------------------------
Report of Independent Public Accountants
- --------------------------------------- ---------------------------------------
To the Shareholders and Board of Trustees of
Goldman Sachs Trust--Financial Square Funds:
We have audited the accompanying statements of assets and liabilities of
Goldman Sachs Trust--Financial Square Funds (a Delaware Business Trust
comprising the Prime Obligations, Money Market, Premium Money Market, Treasury
Obligations, Treasury Instruments, Government, Federal and Tax-Free Money
Market Funds), including the statements of investments, as of December 31,
1998, and the related statements of operations and the statements of changes in
net assets and the financial highlights for the periods presented. These
financial statements and the financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of December 31, 1998 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective Funds constituting Goldman Sachs Trust--Financial Square
Funds as of December 31, 1998, the results of their operations and the changes
in their net assets and the financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
February 12, 1999
49
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------- ---------------------------------------
- --------------------------------------------------------------------------------
This Annual 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.
- --------------------------------------------------------------------------------
50
<PAGE>
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
Jesse H. Cole, Vice President
James A. Fitzpatrick, Vice President
Anne E. Marcel, Vice President
Nancy L. Mucker, Vice President
John M. Perlowski, Treasurer
Michael J. Richman, Secretary
Howard B. Surloff, Assistant Secretary
Valerie A. Zondorak, Assistant Secretary
GOLDMAN SACHS
Investment Adviser,
Distributor and Transfer Agent
Goldman Sachs Funds
One New York Plaza, 41st Floor
New York, NY 10004
[LOGO] Goldman
Sachs
