[LOGO] CMA(R)
CMA CALIFORNIA
MUNICIPAL MONEY FUND
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Annual Report
[GRAPHIC OMITTED]
March 31, 1999
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[LOGO] Merrill Lynch
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TO OUR SHAREHOLDERS:
For the year ended March 31, 1999, CMA California Municipal Money Fund paid
shareholders a net annualized yield of 2.68%.* As of March 31, 1999, the Fund's
7-day yield was 2.34%.
Economic Environment and Investment Strategy
During the six-month period ended March 31, 1999, we continued to see volatility
across a broad spectrum of markets. This volatility was the result of continued
uncertainty regarding the financial stability of Asia and Latin America and the
future role of the newly introduced euro. On November 17, 1998, the Federal
Reserve Board initiated what proved to be its final easing of the period with a
25 basis point (0.25%) reduction of the Federal Funds rate to 4.75%. The US
economy continued to see excellent economic growth as exemplified by fourth
quarter gross domestic product growth of 6.1% and business investment, which
grew at a rate of 13.7% for all of 1998. In addition, January housing starts
were at their highest level in 15 years. This growth continued in a benign
inflationary environment and appeared to be fueled by a confident consumer and a
strong stock market. Despite fears that the Asian contagion would adversely
affect California's economy, it continued to perform well during the six-month
period ended March 31, 1999 and the Asian effect was moderated somewhat by
improved trade with both South America and Europe.
In November, Gray Davis was elected governor, replacing incumbent Pete Wilson,
and Philip Angeides replaced Treasurer Matt Fong. California is expected to end
its current fiscal year with a surplus of approximately $1.0 billion, of which
$600 million or 1% of revenues represents a reserve. The fiscal year 1999-2000
budget presented in January by Governor Davis proposed to draw this balance
down. However, Governor Davis' first budget offered few new policy initiatives
but focused primarily on improving education in the state. Rating agencies
applauded the Governor's attempt to restore two items that would facilitate
adjustments to the budget after its enactment. The state legislature repealed
the Governor's ability to make mid-course corrections and implement automatic
expenditure reduction "trigger" mechanisms. The ability to amend the budget and
react to unexpected events would protect the financial interests of the state
and the trigger mechanisms would automatically reduce expenditures in the event
of any deviation from original budget estimates, thus giving the Governor better
control over unforeseen events. The State Treasurer's office supports this
recommendation as well. Revisions to the budget will occur sometime in May after
the state collects income taxes in April and has a more accurate picture of its
revenues.
Asset growth was the driving force in the short-term municipal market during the
six-month period. Total assets of the tax-exempt money fund industry increased
by approximately $19.8 billion during the period ended March 31, 1999 and
approximately $23.6 billion in the past year. Assets of the California
tax-exempt industry increased by about $2.7 billion during the period and
approximately $3.36 billion year-over-year. CMA California Municipal Money
Fund's assets increased by more than $266 million during the six-month period
and by approximately 11% during the past year.
During most of the six-month period ended March 31, 1999, we maintained an
average portfolio maturity in the mid 50-day range. However, late in the period,
asset outflows
* Based on a constant investment throughout the period, with dividends
compounded daily, and reflecting a net return to the investor after all
expenses.
1
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forced a short-lived rise in commercial paper interest rates. We took advantage
of this opportunity to lock in higher yields and extend the average portfolio
maturity to the 60-day range.
Over the course of the Fund's fiscal year, we maintained an average portfolio
maturity that was slightly longer than those of peer funds for several reasons.
First, the size of the Fund and the reduced issuance in the past year has made
diversification a continued priority. Our tax-exempt commercial paper holdings
provided us with the ability to diversify and also allowed us to capitalize on
periods of market weakness. This, in turn, provided the Fund's shareholders with
a yield exceeding the average of its peer group as measured by IBC Donaghue's
Inc. We do not anticipate any significant supply to enter the market until the
annual note financings in June. The improved finances of the state and its
municipalities will most likely result in reduced issuance this year, putting
continued downward pressure on yields of California tax-exempt securities. We
anticipate that our commercial paper holdings will help insulate the Fund from
the ensuing fluctuation in yields. During April, we allowed the Fund's average
portfolio maturity to decrease as we approached tax time, when we typically
experience redemptions associated with the payment of taxes. During this period,
interest rates on variable rate securities tend to rise as remarketing agents
raise interest rates to avoid the financing costs associated with maintaining
positions of these securities during the tax season.
In Conclusion
In the coming months, we will carefully monitor both the revisions to Governor
Davis' budget as well as the financial well-being of the state and any potential
impact that changes may have to our portfolio strategy. We thank you for your
support of CMA California Municipal Money Fund, and we look forward to serving
your investment needs in the months and years ahead.
Sincerely,
/s/ Terry K. Glenn
Terry K. Glenn
President and Trustee
/s/ Vincent R. Giordano
Vincent R. Giordano
Senior Vice President
/s/ Helen M. Sheehan
Helen M. Sheehan
Vice President and Portfolio Manager
May 13, 1999
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After more than 20 years of service, Arthur Zeikel recently retired as Chairman
of Merrill Lynch Asset Management, L.P. (MLAM). Mr. Zeikel served as President
of MLAM from 1977 to 1997 and as Chairman since December 1997. Mr. Zeikel is one
of the country's most respected leaders in asset management and presided over
the growth of Merrill Lynch's asset management business. During his tenure,
client assets under management grew from $300 million to over $500 billion. Mr.
Zeikel will remain on CMA California Municipal Money Fund's Board of Trustees.
We are pleased to announce that Terry K. Glenn has been elected President and
Trustee of the Fund. Mr. Glenn has held the position of Executive Vice President
of MLAM since 1983.
Mr. Zeikel's colleagues at MLAM join the Fund's Board of Trustees in wishing him
well in his retirement from Merrill Lynch and are pleased that he will continue
as a member of the Fund's Board of Trustees.
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IMPORTANT TAX INFORMATION
All of the net investment income distributions paid daily by CMA California
Municipal Money Fund of CMA Multi-State Municipal Series Trust during its
taxable year ended March 31, 1999 qualify as tax-exempt interest dividends for
Federal income tax purposes.
Additionally, there were no capital gains distributed by the Fund during the
year.
Please retain this information for your records.
CMA CALIFORNIA MUNICIPAL MONEY FUND
Officers and Trustees
Terry K. Glenn--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Arthur Zeikel--Trustee
Vincent R. Giordano--Senior Vice President
Edward J. Andrews--Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Steven T. Lewis--Vice President
Darrin J. SanFillippo--Vice President
Kevin A. Schiatta--Vice President
Helen Marie Sheehan--Vice President
Donald C. Burke--Vice President and
Treasurer
Robert Harris--Secretary
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Gerald M. Richard, Treasurer of CMA California Municipal Money Fund has recently
retired. His colleagues at Merrill Lynch Asset Management, L.P. join the Fund's
Board of Trustees in wishing Mr. Richard well in his retirement.
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Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 221-7210*
* For inquiries regarding your CMA account, call (800) CMA-INFO [(800)
262-4636].
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CMA CALIFORNIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (IN THOUSANDS)
<TABLE>
<CAPTION>
Face Value
State Amount Issue (Note 1a)
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<S> <C> <C> <C>
California-- $ 6,500 ABN Amro Munitops Certificates Trust, VRDN, Series 1998-17,
93.6% 2.88% due 7/05/2006 (a) .................................................... $ 6,500
4,000 California Educational Facilities Authority Revenue Bonds (Pepperdine
University), VRDN, Series B, 2.85% due 11/01/2029 (a) ...................... 4,000
5,600 California Pollution Control Financing Authority, Environmental Improvement
Revenue Bonds (Atlantic), VRDN, AMT, 2.80% due 12/01/2032 (a) .............. 5,600
California Pollution Control Financing Authority, PCR, Refunding
(Pacific Gas & Electric), VRDN (a):
20,500 AMT, Series B, 3.20% due 11/01/2026 .................................... 20,500
40,050 AMT, Series C, 2.85% due 11/01/2026 .................................... 40,050
1,600 Series C, 2.75% due 11/01/2026 ......................................... 1,600
28,400 Series D, 3.15% due 11/01/2026 ......................................... 28,400
8,400 Series E, 3% due 11/01/2026 ............................................ 8,400
8,200 Series G, 2.80% due 2/01/2016 .......................................... 8,200
California Pollution Control Financing Authority, PCR, Refunding
(Southern California Edison), VRDN (a):
9,000 Series A, 3.05% due 2/28/2008 .......................................... 9,000
5,700 Series B, 3.05% due 2/28/2008 .......................................... 5,700
17,000 Series C, 3.05% due 2/28/2008 .......................................... 17,000
600 Series D, 3.05% due 2/28/2008 .......................................... 600
5,400 California Pollution Control Financing Authority, PCR (Southern California
Edison), CP, Series A, 2.90% due 7/21/1999 ................................. 5,400
California Pollution Control Financing Authority, Resource Recovery Revenue
Bonds (Delano Project), VRDN, AMT (a):
9,100 Series 1, 2.90% due 8/01/2019 .......................................... 9,100
8,300 Series 2, 2.90% due 8/01/2019 .......................................... 8,300
9,600 Series 3, 2.90% due 8/01/2019 .......................................... 9,600
California Pollution Control Financing Authority, Resource Recovery
Revenue Bonds, VRDN (a):
4,600 (Atlantic Richfield Company Project), Series A, 2.85% due 12/01/2024 ... 4,600
3,700 (Honey Lake Power Company Project), AMT, 2.90% due 9/01/2018 ........... 3,700
California Pollution Control Financing Authority, Resource Recovery Revenue
Refunding Bonds (UltraPower-Rocklin), VRDN, AMT (a):
17,400 Series A, 2.90% due 6/01/2017 .......................................... 17,400
5,100 Series B, 2.90% due 6/01/2017 .......................................... 5,100
California Pollution Control Financing Authority, Solid Waste Disposal
Revenue Bonds, VRDN, AMT (a):
3,255 (Edco Disposal Corporation Project), Series A, 3.05% due 10/01/2016 .... 3,255
3,000 (Shell Martinez Refining), Series B, 2.80% due 10/01/2031 .............. 3,000
4,965 (Taormina Industries Inc. Project), 2.80% due 8/01/2014 ................ 4,965
16,320 (Taormina Industries Inc. Project), Series B, 2.80% due 8/01/2014 ...... 16,320
75,000 California Public Capital Improvements Financing Authority Revenue Bonds
(Pooled Project), VRDN, Series D, 2.95% due 6/01/2028 (a) .................. 75,000
</TABLE>
Portfolio Abbreviations for CMA California Municipal Money Fund
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
CP Commercial Paper
FLOATS Floating Rate Securities
GO General Obligation Bonds
HFA Housing Finance Agency
IDR Industrial Development Revenue Bonds
M/F Multi-Family
MSTR Municipal Securities Trust Receipts
PCR Pollution Control Revenue Bonds
RAN Revenue Anticipation Notes
TRAN Tax Revenue Anticipation Notes
VRDN Variable Rate Demand Notes
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CMA CALIFORNIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face Value
State Amount Issue (Note 1a)
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<S> <C> <C> <C>
California $12,000 California School Facilities Financing Corporation, COP, Refunding (Capital
(continued) Improvement Financing Projects), VRDN, Series C, 2.75% due 7/01/2022 (a) ... $ 12,000
California State, CP:
7,300 2.75% due 5/03/1999 .................................................... 7,300
21,000 2.70% due 5/07/1999 .................................................... 21,000
15,000 Local, 2.65% due 5/07/1999 ............................................. 15,000
California State Economic Development Financing Authority, IDR, VRDN, AMT (a):
4,000 (Harvel Plastics Inc. Project), 3.20% due 3/01/2010 .................... 4,000
5,000 (Kuhnash Properties/Arkay Project), 2.95% due 4/01/2017 ................ 5,000
4,000 California State Economic Development Financing Authority Revenue Bonds
(California Independent Systems Project), VRDN, Series D,
2.75% due 4/01/2008 (a) .................................................... 4,000
1,750 California State, GO, 4.50% due 10/01/1999 ................................. 1,764
California State, GO, MSTR, VRDN (a):
8,555 Series SGA 7, 2.87% due 9/01/2018 (e) .................................. 8,555
9,600 Series SGA 39, 2.87% due 6/01/2014 (b) ................................. 9,600
8,340 Series SGA 40, 2.87% due 6/01/2013 (c) ................................. 8,340
9,370 Series SGA 72, 2.87% due 6/01/2017 (c) ................................. 9,370
95,000 California State, RAN, 4% due 6/30/1999 .................................... 95,196
39,330 California Statewide Communities Development Authority, COP (Continuing
Care/University Project), VRDN, 2.80% due 11/15/2028 (a) ................... 39,330
California Statewide Communities Development Authority, M/F Housing
Revenue Bonds, VRDN, AMT (a):
10,000 (Canyon Creek Apartments), Series C, 2.90% due 6/15/2025 (f) ........... 10,000
3,660 (Greenback Manor Apartments), Series A, 2.75% due 2/01/2028 ............ 3,660
4,200 (Kimberly Woods), Series B, 2.90% due 6/15/2025 (f) .................... 4,200
10,300 California Statewide Communities Development Authority, Solid Waste
Facilities Revenue Bonds (Chevron U.S.A. Inc. Project), VRDN, AMT,
2.85% due 12/15/2024 (a) ................................................... 10,300
75,000 California Transit Finance Authority Revenue Bonds, VRDN,
2.85% due 10/01/2027 (a)(e) ................................................ 75,000
Chula Vista, California, IDR, Refunding (San Diego Gas & Electric Co.),
VRDN, AMT (a):
20,100 Series A, 3% due 3/01/2023 ............................................. 20,100
26,200 Series B, 3.10% due 12/01/2021 ......................................... 26,200
Chula Vista, California, IDR (San Diego Gas & Electric Co.), CP, AMT:
10,000 Series D, 2.75% due 5/07/1999 .......................................... 10,000
30,000 Series D, 2.85% due 7/12/1999 .......................................... 30,000
20,000 Series E, 2.85% due 7/12/1999 .......................................... 20,000
10,000 Clipper Tax Exempt, COP, VRDN, AMT, Series 98-9, 3.01% due 7/12/2003 (a) ... 10,000
25,000 Contra Costa, California, GO, MSTR, Series 1998-58, Class A,
2.97% due 7/01/1999 ........................................................ 25,000
Contra Costa, California, Water District, CP, Series A:
10,000 2.65% due 5/10/1999 .................................................... 10,000
7,000 2.90% due 7/16/1999 .................................................... 7,000
15,525 Contra Costa, California, Water District Revenue Bonds, MSTR, VRDN,
Series SGA 24, 2.84% due 10/01/2019 (a)(b) ................................. 15,525
5,800 Dublin, California, Housing Authority, M/F Housing Revenue Bonds (Park Sierra),
VRDN, AMT, Series A, 3% due 6/01/2028 (a) .................................. 5,800
</TABLE>
5
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CMA CALIFORNIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face Value
State Amount Issue (Note 1a)
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<S> <C> <C> <C>
California Eagle Tax-Exempt, California HFA, Mortgage Revenue Bonds, VRDN (a):
(continued) $12,345 Series 1992 A-C6, 2.91% due 8/01/2017 .................................. $ 12,345
16,355 Series F-C7, 2.91% due 8/01/2023 ....................................... 16,355
Eagle Tax-Exempt Trust, California State, VRDN (a):
2,660 Series 94 C-0503, 2.91% due 9/01/2003 .................................. 2,660
9,705 Series 97 C-0501, 2.91% due 11/01/2020 ................................. 9,705
10,390 Eagle Tax-Exempt, VRDN, Series 95-050-1A, 2.91% due 2/01/2006 (a) .......... 10,390
East Bay, California, Municipal Utility District, Wastewater Treatment System
Revenue Bonds, CP:
19,600 2.75% due 4/07/1999 .................................................... 19,600
19,200 2.80% due 7/12/1999 .................................................... 19,200
4,000 2.80% due 7/14/1999 .................................................... 4,000
7,050 Fontana, California, M/F Housing Revenue Bonds (Springtime Apartments
Project), VRDN, Series A, 3.05% due 12/01/2016 (a) ......................... 7,050
Fremont, California, Unified School District, Alameda County, GO:
12,150 MSTR, VRDN, Series SGA 37, 2.84% due 8/01/2020 (a)(b) .................. 12,150
9,000 TRAN, 4% due 7/30/1999 ................................................. 9,011
4,685 Fresno, California, Water System Revenue Refunding Bonds, MSTR, VRDN,
Series SGA 76, 2.95% due 6/01/2024 (a)(c) .................................. 4,685
6,620 Highland, California, Redevelopment Agency, M/F Housing Revenue Bonds
(Jeffrey Court Senior Apartments), VRDN, AMT, 2.75% due 3/01/2028 (a) ...... 6,620
1,700 Kern County, California, GO, TRAN, 4.25% due 10/01/1999 .................... 1,711
17,185 Kern County, California, Superintendent of Schools, COP, VRDN, Series A,
2.85% due 12/01/2021 (a) ................................................... 17,185
19,430 Loma Linda, California, M/F Housing Revenue Bonds (Loma Linda Springs
Apartments), VRDN, AMT, 2.95% due 7/01/2019 (a) ............................ 19,430
8,500 Long Beach, California, GO, TRAN, 4% due 10/05/1999 ........................ 8,536
33,500 Long Beach, California, Harbor Revenue Bonds, CP, AMT, Series A,
3.85% due 7/12/1999 ........................................................ 33,500
3,000 Los Angeles, California, Department of Airports, Airport Municipal Trust
Revenue Bonds, FLOATS, Series SG 61, 2.90% due 5/15/2020 (a) ............... 3,000
Los Angeles, California, Department of Water and Power, CP:
20,800 2.75% due 4/16/1999 .................................................... 20,800
58,000 2.65% due 5/10/1999 .................................................... 58,000
Los Angeles, California, Department of Water and Power, Electric Plant
Revenue Refunding Bonds, MSTR, VRDN (a):
4,075 Series SGA 4, 2.84% due 11/15/2019 (c) ................................. 4,075
4,005 Series SGA 6, 2.84% due 11/15/2019 (b) ................................. 4,005
5,000 Los Angeles, California, Harbor Department Revenue Bonds, FLOATS,
Series SG-59, 2.90% due 8/01/2026 (a) ...................................... 5,000
7,000 Los Angeles, California, M/F Housing Revenue Bonds, VRDN, Series K,
2.80% due 7/01/2010 (a) .................................................... 7,000
Los Angeles, California, Wastewater System Revenue Bonds, CP:
15,900 2.40% due 5/07/1999 .................................................... 15,900
30,400 2.80% due 7/12/1999 .................................................... 30,400
13,000 2.80% due 7/13/1999 .................................................... 13,000
5,000 2.85% due 8/12/1999 .................................................... 5,000
29,930 Los Angeles County, California, Capital Asset Leasing Corporation Leasehold
Revenue Bonds, CP, 2.70% due 5/07/1999 ..................................... 29,930
99,000 Los Angeles County, California, GO, TRAN, Series A, 4.50% due 6/30/1999 .... 99,197
</TABLE>
6
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CMA CALIFORNIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face Value
State Amount Issue (Note 1a)
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<S> <C> <C> <C>
California $ 5,700 Los Angeles County, California, Housing Authority, M/F Housing Revenue
(continued) Bonds (Park Sierra Project), VRDN, 2.80% due 12/01/2008 (a) ................ $ 5,700
Los Angeles County, California, Metropolitan Transportation Authority, CP:
6,000 2.80% due 7/14/1999 .................................................... 6,000
10,000 2.80% due 7/20/1999 .................................................... 10,000
Los Angeles County, California, Metropolitan Transportation Authority Revenue
Bonds, Sales Tax Revenue Bonds, FLOATS (a):
6,000 Series SG-46, 2.90% due 7/01/2017 ...................................... 6,000
50,820 Series SG-55, 2.90% due 7/01/2018 ...................................... 50,820
Los Angeles County, California, Metropolitan Transportation Authority,
Revenue Refunding Bonds, MSTR, VRDN (a)(e):
38,675 Series SGB 1, 3.04% due 7/01/2025 ...................................... 38,675
16,300 Series SGB 2, 3.04% due 7/01/2021 ...................................... 16,300
Metropolitan Water District of Southern California, CP:
9,800 Series A, 2.40% due 4/12/1999 .......................................... 9,800
7,400 Series A, 2.70% due 6/16/1999 .......................................... 7,400
5,000 Series B, 2.70% due 5/07/1999 .......................................... 5,000
40,900 Series B, 2.80% due 7/12/1999 .......................................... 40,900
7,435 Monrovia, California, Unified School District, GO, MSTR, VRDN, Series SGA 70,
2.84% due 8/01/2022 (a)(b) ................................................. 7,435
23,650 Northern California Power Agency, Public Power, FLOATS, Series A42,
3% due 7/01/2032 (a) ....................................................... 23,650
41,000 Oakland, California, GO, TRAN, 4.25% due 9/30/1999 ......................... 41,217
5,000 Pittsburg, California, Mortgage Obligation Revenue Refunding Bonds,
VRDN, Series A, 3% due 12/30/2031 (a) ...................................... 5,000
13,570 Port Oakland, California, Port Revenue Bonds, MSTR, VRDN, Series SG 112,
3.15% due 11/01/2025 (a) ................................................... 13,570
3,150 Redlands, California, M/F Housing Revenue Bonds (Orange Village Apartments
Project), VRDN, AMT, Series A, 2.95% due 8/01/2018 (a) ..................... 3,150
12,840 Riverside County, California, GO, TRAN, 4.50% due 9/30/1999 ................ 12,918
9,713 Sacramento, California, Municipal Utility District, Electric Revenue Bonds, CP,
2.90% due 6/18/1999 ........................................................ 9,713
5,760 Sacramento, California, Municipal Utility District, Electric Revenue Bonds,
MSTR, VRDN, Series SGB 4, 2.96% due 8/15/2021 (a)(d) ....................... 5,760
9,400 Sacramento, California, Municipal Utility District, Electric Revenue Refunding
Bonds, MSTR, VRDN, Series SGA 5, 2.84% due 11/15/2006 (a)(e) ............... 9,400
25,000 Sacramento County, California, GO, MSTR, Series 1998-60, Class A,
2.92% due 6/01/1999 ........................................................ 25,000
22,000 San Bernardino, California, City Unified School District, GO, TRAN,
3.50% due 11/30/1999 ....................................................... 22,084
10,000 San Bernardino County, California, COP, Refunding (Medical Center
Financing Project), VRDN, 2.70% due 8/01/2026 (a)(b) ....................... 10,000
3,500 San Bernardino County, California, GO, TRAN, 4.50% due 9/30/1999 3,526
5,900 San Bernardino County, California, Residential Mortgage Revenue Refunding
Bonds (Ramona Garden), VRDN, Series A, 2.80% due 2/01/2017 (a) ............. 5,900
7,300 San Diego, California, GO, TRAN, Series A, 4.50% due 9/30/1999 ............. 7,344
San Diego, California, IDR, Refunding (San Diego Gas & Electric), CP, Series A:
2,000 2.65% due 7/14/1999 .................................................... 2,000
2,500 2.80% due 7/20/1999 .................................................... 2,500
7,000 San Diego, California, Sewer Revenue Bonds, FLOATS, Series SG 14,
2.85% due 5/15/2020 (a) .................................................... 7,000
10,990 San Diego, California, Unified School District, GO, TRAN, Series A,
4.50% due 10/01/1999 ....................................................... 11,065
</TABLE>
7
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face Value
State Amount Issue (Note 1a)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
California San Francisco, California, Bay Area Rapid Transit District, CP, Series A:
(concluded) $10,000 2.70% due 5/07/1999 .................................................... $ 10,000
6,100 2.60% due 7/14/1999 .................................................... 6,100
3,645 San Francisco, California, City and County Airport Commission, International
Airport Revenue Bonds, FLOATS, Series SG-88, 2.85% due 5/01/2021 (a) ....... 3,645
San Francisco, California, City and County Airport Commission, International
Airport Revenue Bonds, MSTR, VRDN (a):
7,705 AMT, Series SGA 56, 2.87% due 5/01/2026 (b) ............................ 7,705
18,590 Series SG 113, 3.10% due 5/01/2026 ..................................... 18,590
28,005 Series SG 115, 3.15% due 5/01/2026 ..................................... 28,005
16,555 Series SG 116, 3.15% due 5/01/2026 ..................................... 16,555
1,000 San Francisco, California, City and County, GO (Public Safety Improvement
Projects 1990), Series C, 8% due 6/15/1999 ................................. 1,009
3,000 San Francisco, California, City and County Sewer Revenue Refunding Bonds,
5.50% due 10/01/1999 (d) ................................................... 3,041
16,400 San Joaquin County, California, GO, TRAN, 3.50% due 12/31/1999 ............. 16,469
13,000 San Jose, California, M/F Housing Revenue Bonds (Siena), VRDN,
2.95% due 12/01/2029 (a) ................................................... 13,000
2,000 San Jose-Santa Clara, California, Water Financing Authority, Sewer Revenue
Bonds, FLOATS, Series SG-49, 2.85% due 11/15/2020 (a) ...................... 2,000
9,935 Santa Clara, California, Electric Revenue Refunding Bonds, MSTR, VRDN,
Series SGA 75, 2.95% due 7/01/2027 (a)(d) .................................. 9,935
2,500 Santa Clara County, California, GO, TRAN, 4.50% due 10/01/1999 ............. 2,516
8,315 Santa Cruz County, California, Public Financing Authority Revenue Bonds,
MSTR, VRDN, Series SG-23, 2.90% due 9/01/2023 (a) .......................... 8,315
5,225 Santa Rosa, California, M/F Housing Revenue Bonds (Oak Creek Apartments
Project), VRDN, Series A, 2.80% due 6/01/2018 (a) .......................... 5,225
3,550 Simi Valley, California, Community Redevelopment Agency, M/F Housing Revenue
Bonds (Ashlee Manor Project), VRDN, AMT, Series A, 3.05% due 10/01/2017 (a) 3,550
12,000 Simi Valley, California, M/F Housing Revenue Bonds (Shadowridge Apartments),
VRDN, 3% due 9/01/2019 (a) ................................................. 12,000
6,765 Southern California Public Power Authority, Power Project Revenue Bonds,
MSTR, VRDN, Series SG-35, 2.85% due 7/01/2012 (a) .......................... 6,765
Southern California Public Power Authority, Power Project Revenue Refunding
Bonds (Palo Verde Project), VRDN (a)(d):
9,270 Series B, 2.85% due 7/01/2009 .......................................... 9,270
8,500 Series C, 2.85% due 7/01/2017 .......................................... 8,500
Southern California Public Power Authority, Transmission Project Revenue
Refunding Bonds (Southern Transmission):
5,000 Series A, 4% due 7/01/1999 (b) ......................................... 5,004
26,600 VRDN, 2.85% due 7/01/2019 (a)(d) ....................................... 26,600
University of California, Board of Regents Revenue Bonds, CP:
10,000 2.75% due 4/16/1999 .................................................... 10,000
10,000 2.50% due 5/06/1999 .................................................... 10,000
5,300 2.70% due 5/07/1999 .................................................... 5,300
20,000 2.65% due 5/10/1999 .................................................... 20,000
5,000 2.80% due 7/13/1999 .................................................... 5,000
25,000 2.70% due 7/23/1999 .................................................... 25,000
20,000 2.95% due 8/18/1999 .................................................... 20,000
7,000 Upland, California, Apartment Development Revenue Refunding Bonds
(Mountain Springs--Issue A), VRDN, 2.80% due 11/15/2028 (a)(f) ............. 7,000
20,000 Watereuse Finance Authority, California, Revenue Bonds, VRDN,
2.65% due 5/01/2028 (a)(e) ................................................. 20,000
</TABLE>
8
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONCLUDED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face Value
State Amount Issue (Note 1a)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Guam--0.3% $ 7,200 Guam Power Authority Revenue Bonds, CP, 2.90% due 6/18/1999 ............... $ 7,200
- ---------------------------------------------------------------------------------------------------------------------
Puerto Rico-- Puerto Rico Commonwealth, Government Development Bank, CP:
5.4% 12,758 2.60% due 4/05/1999 .................................................... 12,758
10,000 2.40% due 5/07/1999 .................................................... 10,000
17,300 2.65% due 5/12/1999 .................................................... 17,300
11,655 2.80% due 5/18/1999 .................................................... 11,655
2,500 3% due 7/07/1999 ....................................................... 2,500
20,530 2.60% due 7/14/1999 .................................................... 20,530
23,765 2.65% due 7/14/1999 .................................................... 23,765
3,342 3% due 7/29/1999 ....................................................... 3,342
4,644 3% due 8/24/1999 ....................................................... 4,644
16,700 Puerto Rico Electric Power Authority, Power Revenue Bonds, MSTR, VRDN,
Series SGA-44, 2.75% due 7/01/2023 (a) ..................................... 16,700
- ---------------------------------------------------------------------------------------------------------------------
Total Investments (Cost--$2,255,290*)--99.3% ............................... 2,255,290
Other Assets Less Liabilities--0.7% ........................................ 15,574
----------
Net Assets--100.0% ......................................................... $2,270,864
==========
=====================================================================================================================
</TABLE>
(a) The interest rate is subject to change periodically based on certain
indexes. The interest rate shown is the rate in effect at March 31, 1999.
(b) MBIA Insured.
(c) FGIC Insured.
(d) AMBAC Insured.
(e) FSA Insured.
(f) FNMA Collateralized.
* Cost for Federal income tax purposes.
See Notes to Financial Statements.
9
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF MARCH 31, 1999
<TABLE>
<S> <C> <C>
Assets:
Investments, at value (identified cost--$2,255,289,972) (Note 1a) ........ $ 2,255,289,972
Cash ..................................................................... 79,177
Receivables:
Interest ............................................................... $ 17,031,922
Securities sold ........................................................ 193,750 17,225,672
---------------
Prepaid registration fees and other assets (Note 1d) ..................... 22,169
---------------
Total assets ............................................................. 2,272,616,990
---------------
Liabilities:
Payables:
Investment adviser (Note 2) ............................................ 833,111
Distributor (Note 2) ................................................... 667,938
Dividends to shareholders (Note 1e) .................................... 683 1,501,732
---------------
Accrued expenses and other liabilities ................................... 251,532
---------------
Total liabilities ........................................................ 1,753,264
---------------
Net Assets ............................................................... $ 2,270,863,726
===============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of shares
authorized ............................................................... $ 227,169,835
Paid-in capital in excess of par ......................................... 2,044,526,857
Accumulated realized capital losses--net (Note 4) ........................ (832,966)
---------------
Net Assets--Equivalent to $1.00 per share based on 2,271,698,351 shares of
beneficial interest outstanding .......................................... $ 2,270,863,726
===============
</TABLE>
See Notes to Financial Statements.
10
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 1999
<TABLE>
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $67,002,037
Expenses:
Investment advisory fees (Note 2) ...................... $ 8,687,408
Distribution fees (Note 2) ............................. 2,589,655
Transfer agent fees (Note 2) ........................... 240,243
Accounting services (Note 2) ........................... 182,407
Registration fees (Note 1d) ............................ 153,941
Custodian fees ......................................... 105,672
Professional fees ...................................... 67,112
Printing and shareholder reports ....................... 66,458
Pricing fees ........................................... 16,718
Trustees' fees and expenses ............................ 13,681
Other .................................................. 21,462
-----------
Total expenses ......................................... 12,144,757
-----------
Investment income--net ................................. 54,857,280
Realized Gain on Investments--Net (Note 1c) ............ 125,182
-----------
Net Increase in Net Assets Resulting from Operations ... $54,982,462
===========
</TABLE>
See Notes to Financial Statements.
11
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the Year Ended March 31,
----------------------------------
Increase (Decrease) in Net Assets: 1999 1998
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Investment income--net ................................................. $ 54,857,280 $ 52,482,352
Realized gain (loss) on investments--net ............................... 125,182 (44,912)
--------------- ---------------
Net increase in net assets resulting from operations ................... 54,982,462 52,437,440
--------------- ---------------
Dividends to Shareholders (Note 1e):
Investment income--net ................................................. (54,857,280) (52,480,433)
--------------- ---------------
Net decrease in net assets resulting from dividends to shareholders .... (54,857,280) (52,480,433)
--------------- ---------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares ....................................... 8,434,578,655 7,751,865,673
Net asset value of shares issued to shareholders in reinvestment of
dividends (Note 1e) .................................................... 54,856,838 52,479,878
--------------- ---------------
8,489,435,493 7,804,345,551
Cost of shares redeemed ................................................ (8,224,359,781) (7,364,441,995)
--------------- ---------------
Net increase in net assets derived from beneficial interest transactions 265,075,712 439,903,556
--------------- ---------------
Net Assets:
Total increase in net assets ........................................... 265,200,894 439,860,563
Beginning of year ...................................................... 2,005,662,832 1,565,802,269
--------------- ---------------
End of year ............................................................ $ 2,270,863,726 $ 2,005,662,832
=============== ===============
</TABLE>
See Notes to Financial Statements.
CMA CALIFORNIA MUNICIPAL MONEY FUND
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements. For the Year Ended March 31,
----------------------------------------------------------------------
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1996 1995
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Investment income--net ................... .03 .03 .03 .03 .03
Realized gain (loss) on investments--net . -- + -- + -- + -- + -- +
---------- ---------- ---------- ---------- ----------
Total from investment operations ......... .03 .03 .03 .03 .03
---------- ---------- ---------- ---------- ----------
Less dividends from investment income--net (.03) (.03) (.03) (.03) (.03)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Investment Return .................. 2.68% 3.06% 2.90% 3.15% 2.66%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses ................................. .58% .59% .60% .64% .63%
========== ========== ========== ========== ==========
Investment income--net ................... 2.63% 3.00% 2.85% 3.11% 2.62%
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of year (in thousands) ... $2,270,864 $2,005,663 $1,565,802 $1,421,140 $1,168,234
========== ========== ========== ========== ==========
</TABLE>
+ Amount is less than $.01 per share.
See Notes to Financial Statements.
12
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA California Municipal Money Fund (the "Fund") is part of CMA Multi-State
Municipal Series Trust (the "Trust"). The Fund is registered under the
Investment Company Act of 1940 as a non-diversified, open-end management
investment company. The Fund's financial statements are prepared in accordance
with generally accepted accounting principles which may require the use of
management accruals and estimates. The following is a summary of significant
accounting policies followed by the Fund.
(a) Valuation of investments--Investments are valued at amortized cost, which
approximates market value. For the purpose of valuation, the maturity of a
variable rate demand instrument is deemed to be the next coupon date on which
the interest rate is to be adjusted. In the case of a floating rate instrument,
the remaining maturity is the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no Federal income tax provision is required.
(c) Security transactions and investment income--Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Interest income (including amortization of premium and discount) is recognized
on the accrual basis. Realized gains and losses on security transactions are
determined on the identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are charged to expense
as the related shares are issued.
(e) Dividends and distributions to shareholers--The Fund declares dividends
daily and reinvests daily such dividends (net of nonresident alien tax withheld)
in additional fund shares at net asset value. Dividends are declared from the
total of net investment income, excluding discounts earned other than original
issue discounts. Net realized capital gains, if any, are normally distributed
annually after deducting prior years' loss carryforward. The Fund may distribute
capital gains more frequently than annually in order to maintain the Fund's net
asset value at $1.00 per share.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund Asset
Management, L.P. ("FAM"). The general partner of FAM is Princeton Services, Inc.
("PSI"), an indirect wholly-owned subsidiary of Merrill Lynch & Co., Inc. ("ML &
Co."), which is the limited partner.
FAM is responsible for the management of the Fund's portfolio and provides the
necessary personnel, facilities, equipment and certain other services necessary
to the operations of the Fund. For such services, the Fund pays a monthly fee
based upon the average daily value of the Fund's net assets, at the following
annual rates: 0.50% of the first $500 million of average daily net assets;
0.425% of average daily net assets in excess of $500 million but not exceeding
$1 billion, and 0.375% of average daily net assets in excess of $1 billion.
Pursuant to the Distribution and Shareholder Servicing Plan in compliance with
Rule 12b-1 under the Investment Company Act of 1940, Merrill Lynch, Pierce,
Fenner & Smith Incorporated ("MLPF&S") receives a distribution fee from the Fund
at the end of each month at the annual rate of 0.125% of average daily net
assets of the Fund. The distribution fee is to compensate MLPF&S financial
consultants and other directly involved branch office personnel for selling
shares of the Fund and
13
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
for providing direct personal services to shareholders. The distribution fee is
not compensation for the administrative and operational services rendered to the
Fund by MLPF&S in processing share orders and administering shareholder
accounts.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of ML & Co., is
the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or directors of
FAM, PSI, FDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the period corresponds to the
amounts included in the Statements of Changes in Net Assets for net proceeds
from sale of shares and cost of shares redeemed, respectively, since shares are
recorded at $1.00 per share.
4. Capital Loss Carryforward:
At March 31, 1999, the Fund had a net capital loss carryforward of approximately
$833,000, of which $315,000 expires in 2002, $476,000 expires in 2003 and
$42,000 expires in 2006. This amount will be available to offset a like amount
of any future taxable gains.
14
<PAGE>
CMA CALIFORNIA MUNICIPAL MONEY FUND
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders, CMA California Municipal Money Fund of
CMA Multi-State Municipal Series Trust:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of CMA California Municipal Money Fund of CMA
Multi-State Municipal Series Trust as of March 31, 1999, the related statements
of operations for the year then ended and changes in net assets for each of the
years in the two-year period then ended, and the financial highlights for each
of the years in the five-year period then ended. These financial statements and
the financial highlights are the responsibility of the Fund's 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. Our procedures included confirmation of securities owned at March
31, 1999 by correspondence with the custodian. 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, such financial statements and financial highlights present
fairly, in all material respects, the financial position of CMA California
Municipal Money Fund of CMA Multi-State Municipal Series Trust as of March 31,
1999, the results of its operations, the changes in its net assets, and the
financial highlights for the respective stated periods in conformity with
generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
May 14, 1999
15
<PAGE>
This report is not authorized for use as an offer of sale or a solicitation of
an offer to buy shares of the Fund unless accompanied or preceded by the Fund's
current prospectus. An investment in the Fund is not insured or guaranteed by
the Federal Deposit Insurance Corporation or any other Government agency.
Although the Fund seeks to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund. Past performance
results shown in this report should not be considered a representation of future
performance, which will fluctuate. Statements and other information herein are
as dated and are subject to change.
CMA California
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011 #11211--3/99
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