This information must be preceded or accompanied by a current prospectus.
Portfolio changes should not be considered recommendations for action by
individual investors.
Scudder
Gold
Fund
Semiannual Report
December 31, 1995
o A convenient and cost-effective way to broaden a portfolio of stocks, bonds,
and money market investments. Offers potential for maximum return from a
portfolio of gold and gold-related investments in exchange for above-average
risk.
o A pure no-load(TM) fund with no commissions to buy, sell, or exchange shares.
<PAGE>
SCUDDER GOLD FUND
CONTENTS
2 In Brief
3 Letter from the Fund's President
4 Performance Update
5 Portfolio Summary
6 Portfolio Management Discussion
10 Investment Portfolio
15 Consolidated Financial Statements
18 Consolidated Financial Highlights
19 Notes to Consolidated Financial Statements
24 Report of Independent Accountants
25 Tax Information
25 Officers and Directors
26 Investment Products and Services
27 How to Contact Scudder
IN BRIEF
- - Scudder Gold Fund continued its above-average performance relative to the
Lipper average for gold-oriented funds in the six- and 12-month periods
ended December 31, 1995, with total returns of 2.97% and 13.17%,
respectively.
Total Returns for Gold and Gold Funds
(Periods ended December 31, 1995)
6 months 12 months
-------- ---------
Gold Bullion, 0.00% 1.00%
London p.m.
fix
Platinum, -10.00% -4.60%
free market
price
Toronto -2.40% 8.60%
Stock
Exchange
Gold Index
Johannesburg -8.00% -33.00%
(South Africa)
Stock Exchange
Gold Index
Lipper 0.58% 1.76%
Average
for Gold-
Oriented Funds
Scudder 2.97% 13.17%
Gold Fund
Past performance does not guarantee future results.
- - The price of gold fluctuated in a $375-$397 range during the period, on a
gradually upward trend.
- - The Fund kept fully invested in equities during most of the year, since
gold equity prices represented better value than the price of bullion.
2
<PAGE>
LETTER FROM THE FUND'S PRESIDENT
Dear Shareholders,
Scudder Gold Fund is designed for investors who seek a convenient and
cost-effective means to participate in possible increases in the price of gold.
The Fund seeks to maximize its return by investing in a portfolio primarily made
up of gold stocks, gold bullion, and other gold-related investments. Gold
investments, in addition to being traditionally viewed as a hedge against
inflation, can add diversification to a portfolio of stocks, bonds, and money
market investments since historically gold as a tangible asset has not always
moved in the same direction or to the same degree as financial instruments.
What additional qualities does Scudder Gold Fund bring to investors?
The extensive experience of the Fund's portfolio management team affords
investors the potential to benefit from new discoveries -- startups and
exploration ventures that have the potential to capitalize on substantial gold
finds and generate significant profits in the future. In searching for these
prospects, our bywords are "the people, the place, the program." Put another
way, what sort of track record does the company's management have? What is known
geologically about the area the company proposes to mine? And how realistic are
the company's financial plans? Our portfolio managers visit gold-producing
regions around the world, including the four biggest emerging regions -- the
Guyana Shield in South America, West Africa, the Alto Plano of Peru and Bolivia,
and the Indonesian archipelago -- to see for themselves.
As you know, the interests of the Fund's shareholders are represented
by the Fund's Board of Trustees. We would like to take this opportunity to thank
Robert G. Stone, Jr., who recently retired as a Fund Trustee, for his years of
service. We welcome the Board's newest member, Keith R. Fox.
In closing, we would also like to thank all of you, the Fund's
shareholders, for investing in Scudder Gold Fund. We are committed to providing
a portfolio that meets your investment needs.
Sincerely,
/s/Daniel Pierce
Daniel Pierce
President,
Scudder Gold Fund
3
<PAGE>
SCUDDER GOLD FUND
PERFORMANCE UPDATE as of December 31, 1995
- -----------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
- -----------------------------------------------------------------
SCUDDER GOLD FUND
- ----------------------------------------
Total Return
Period Growth --------------
Ended of Average
12/31/95 $10,000 Cumulative Annual
- -------- ------- ---------- ------
1 Year $11,317 13.17% 13.17%
5 Year $14,139 41.39% 7.17%
Life of
Fund* $11,997 19.97% 2.51%
S&P 500 INDEX
- --------------------------------------
Total Return
Period Growth --------------
Ended of Average
12/31/95 $10,000 Cumulative Annual
- -------- ------- ---------- ------
1 Year $13,758 37.58% 37.58%
5 Year $21,544 115.44% 16.58%
Life of
Fund* $28,339 183.39% 15.45%
* The Fund commenced operations on
September 2, 1988. Index comparisons
begin September 30, 1988.
A chart in the form of a line graph appears here,
illustrating the Growth of a $10,000 Investment.
The data points from the graph are as follows:
YEARLY PERIODS ENDED DECEMBER 31
Scudder Gold Fund
Year Amount
- ----------------------
9/30/88* $10,000
88 $ 9,659
89 $10,690
90 $ 8,908
91 $ 8,291
92 $ 7,541
93 $12,026
94 $11,129
95 $12,595
S&P 500 Index
Year Amount
- ----------------------
9/30/88* $10,000
88 $10,309
89 $13,575
90 $13,154
91 $17,161
92 $18,469
93 $20,330
94 $20,559
95 $28,339
The Standard & Poor's (S&P) 500 Index is an unmanaged capitalization-
weighted measure of 500 widely held common stocks listed on the
New York Stock Exchange, American Stock Exchange, and Over-The-Counter
market. Index returns assume reinvestment of dividends and, unlike
Fund returns, do not reflect any fees or expenses.
- -----------------------------------------------------------------
RETURNS AND PER SHARE INFORMATION
- -----------------------------------------------------------------
A chart in the form of a bar graph appears here,
illustrating the Fund Total Return (%) and Index Total
Return (%) with the exact data points listed in the table
below.
YEARLY PERIODS ENDED DECEMBER 31
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1988* 1989 1990 1991 1992 1993 1994 1995
---------------------------------------------------------------
NET ASSET VALUE... $11.04 $12.12 $10.10 $ 9.40 $ 8.55 $13.36 $11.71 $11.53
INCOME DIVIDENDS.. $ -- $ .01 $ -- $ -- $ -- $ .24 $ .25 $ 1.08
CAPITAL GAINS
AND OTHER
DISTRIBUTIONS..... $ -- $ .09 $ -- $ -- $ -- $ -- $ .47 $ .63
FUND TOTAL
RETURN (%)........ -8.00 10.67 -16.67 -6.93 -9.04 59.47 -7.46 13.17
INDEX TOTAL
RETURN (%)........ 3.08 31.63 -3.11 30.40 7.61 10.06 1.32 37.58
</TABLE>
All performance is historical, assumes reinvestment of all dividends and
capital gains, and is not indicative of future results. Investment return
and principal value will fluctuate, so an investor's shares, when redeemed,
may be worth more or less than when purchased. If the Adviser had not
temporarily capped expenses, the average annual total return for the
five year and life of fund periods would have been lower.
4
<PAGE>
PORTFOLIO SUMMARY as of December 31, 1995
- ---------------------------------------------------------------------------
DIVERSIFICATION
- ---------------------------------------------------------------------------
As a percentage of net assets
Equity Securities 90% The Fund is broadly
Precious Metals 8% diversified, with holdings in
Cash Equivalents, net 2% over 70 gold stock issues.
----
100%
====
A graph in the form of a pie chart appears here,
illustrating the exact data points in the above table.
- --------------------------------------------------------------------------
QUALITY DISTRIBUTION
- --------------------------------------------------------------------------
Tier breakdown of the Fund's common stocks
Tier I Premier gold producing
companies 25%
Tier II Major established gold
producers 31% The Fund was able to post
Tier III Junior gold producers positive performance mainly
with medium cost through holdings in
production 13% Tiers III through V.
Tier IV Companies with some
gold production on
stream or in startup 7%
Tier V Primarily exploration
companies with or
without mineral reserves 24%
----
100%
====
A graph in the form of a pie chart appears here,
illustrating the exact data points in the above table.
- --------------------------------------------------------------------------
TEN LARGEST EQUITY HOLDINGS
- --------------------------------------------------------------------------
1. STILLWATER MINING CO.
Exploration and development of mines in Montana producing
platinum, palladium and associated metals
2. BARRICK GOLD CORP.
Gold exploration and production in North and South America
3. HEMLO GOLD MINES, INC.
Large gold producer, with single mine in Ontario; active
exploration company
4. PIONEER GROUP INC.
Fund management company owning major gold producer in Ghana
5. ASHANTI GOLDFIELDS CO., LTD. (ADS)
World class gold producer in Ghana
6. EURO-NEVADA MINING, LTD.
Large North American royalty owner
7. SANTA FE PACIFIC GOLD CORP.
Major domestic gold mining company
8. CAMBIOR INC.
Medium-sized gold producer with a major mine in Guyana
9. BRE-X MINERALS LTD.
Gold exploration company in Indonesia
10. PLACER DOME INC.
International gold, silver and copper mining
Bre-X, the Fund's ninth-largest holding and outstanding performer
over the past year, is currently evaluating a large gold discovery.
- --------------------------------------------------------------------------
For more complete details about the Fund's Investment Portfolio,
see page 10.
A monthly Investment Portfolio Summary and quarterly Portfolio Holdings
are available upon request.
5
<PAGE>
SCUDDER GOLD FUND
PORTFOLIO MANAGEMENT DISCUSSION
Dear Shareholders,
During the six months leading up to December 31, 1995, gold stock
prices fluctuated in a very narrow range. Strong gains earlier in the year
evaporated last October when the price of gold failed to rise according to
expectations. The average performance of gold funds tracked by Lipper Analytical
Services, Inc., was 0.58% for the six-month period. Scudder Gold Fund produced a
positive total return of 2.97% for the period, helped by the performance of
several small gold stocks. The Fund's net asset value declined $1.33 to $11.53
during the period, but the price decline was more than offset by payment to
shareholders of $1.08 in income and $0.63 in long-term capital gain
distributions. Historically, the Fund has outpaced the average performance of
gold funds, as shown in the chart below:
Investment Returns for periods ended December 31, 1995
Number of
Period Scudder Gold Fund Lipper Average Funds tracked
------ ----------------- -------------- -------------
6 months 2.97% 0.58% 45
1 year 13.17 1.76 39
2 years* 2.34 (5.93) 34
3 years* 18.65 16.67 31
4 years* 11.02 7.84 29
5 years* 7.17 5.44 28
Life of Fund* 2.51 2.73 23
* Average annual total returns
Performance statistics compiled by Lipper Analytical Services, Inc.
Demand for Gold Outstrips Supply
Though the short-term influences on the price of gold are many, supply
and demand remain the most critical factors over the long term. Currently, the
worldwide demand for gold -- 80-90% of which is represented by jewelry
fabrication demand -- currently exceeds supply by a wide margin. This is why at
the close of the Fund's semiannual period we believed that the price of gold
would break the $400 barrier soon. Since February of 1995 gold has
6
<PAGE>
fluctuated in a price range of $375 to $397. As we described in our previous
report, gold has made several runs at the $400 benchmark, only to be stemmed by
heavy forward selling by gold producers. (Selling forward occurs when producers
borrow gold and sell it in advance of gold they will mine themselves six months
to four years in the future.) We now believe forward selling into rallies may be
diminishing. Central banks and others who have been lending gold to producers
for forward selling are not lending as readily. This has caused the "lease rate"
that gold lenders charge to spike upwards occasionally. In the past this rate
ranged from 0.75% to 1.5%. Recently, we witnessed lease rates that rose to over
6% for a brief time before dropping back down to nearly 2%. This is why, in the
short term, the trend of gold prices will be influenced by the actions of its
large-volume borrowers and lenders.
Two other important trends are apparent: The 1995 gold market was
orderly. This favors gold producers, who can plan production based on reasonable
assumptions concerning the future price of gold. But an orderly market can also
weaken some gold stocks: if gold prices move upward only slowly, some
larger-company gold stocks may be perceived as overvalued because their earnings
depend on more significant increases in gold's value. At the same time, we
believe central banks and others have established a "floor" for the price of
gold -- buying heavily when gold fluctuates to the lower end of its current
range -- to protect the value of their holdings.
Portfolio Review
Tier I and II gold stocks, those from premier and established gold
mining companies, did not change significantly in price during the six months
ended December 31. Scudder Gold Fund was able to post positive performance
mainly through gains in holdings in Tiers III through V (see page 5 for a
complete description of Tier categories I through V). The Fund's outstanding
performer was Bre-X, a Tier V stock. Bre-X is a Canadian exploration company
mining in Indonesia, currently taking inventory of a massive gold discovery,
perhaps the largest of the century. Drilling
7
<PAGE>
to date suggests a minimum resource of perhaps 30 million ounces of gold, and
the potential for further additions remains. As awareness of the company spread
in 1995, its share price climbed 1,850%. Other good performers during the
previous six months were Kinross (Tier III) and South Pacific (Tier V). South
Pacific is in the same geological zone as Bre-X, and we are hopeful that it will
fulfill its bright promise.
These and other solid performers started from relatively small
positions in the Fund's portfolio and grew as their prices rose. Typically, we
sell portions of rapidly growing stocks to accumulate gains and prevent them
from becoming too large a percentage of the Fund's portfolio. This also enables
us to reinvest the proceeds in newer discoveries. Through continual
diversification, we work to prevent unnecessary price fluctuation and maintain a
balanced portfolio.
Investor enthusiasm for Venezuelan gold exploration companies peaked at
the end of 1993 and early 1994 as progress was all but halted due to political
uncertainties. As these uncertainties are removed, we believe investors will
renew their interest in the country's gold companies. In addition, Venezuelan
government ministers are working to reform the country's mining code, which
governs ownership, taxation, and gold sales for foreign companies engaged in
mining or other mineral enterprises. If a new mining code is approved, we
believe several firms will commit meaningful exploration and production
resources to that country.
Lastly, we reviewed our position in South Africa during the period and,
because conditions there have deteriorated, we no longer hold any stocks of
South African gold mining companies.
8
<PAGE>
Outlook
Two factors should benefit prices of gold and gold stocks in the months
to come: First, as we mentioned, global demand for gold exceeds its supply.
Second, in our opinion the supply of gold equities overall is limited. The
worldwide capitalization of gold stocks is approximately $65 billion, half that
of the consumer products and defense firm General Electric.
As of this writing, gold had broken through the $400 barrier, but
whether its pricing will proceed in an orderly or volatile fashion is still
unclear. We believe there are two possible scenarios for gold bullion pricing
over the coming year. In the first scenario, an orderly market is restored as
gold producers resume forward selling and gold settles back to a price higher
than in 1995. In the second scenario, a more volatile market predominates, and
gold's price continues to run up.
In either case, we will seek to benefit from developments in this
market and continue to search for a range of investments in gold exploration and
production firms worldwide. As such, we believe the Fund remains an appropriate
investment for those seeking diversification, a hedge against inflation, and
participation in the world's gold and precious metals markets.
Sincerely,
Your Portfolio Management Team
/s/Douglas D. Donald /s/William J. Wallace
Douglas D. Donald William J. Wallace
9
<PAGE>
<PAGE>
SCUDDER GOLD FUND
INVESTMENT PORTFOLIO as of December 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF PRINCIPAL MARKET
PORTFOLIO AMOUNT ($) VALUE ($)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
---------------------------------------------------------------------------------
1.0% REPURCHASE AGREEMENTS
---------------------------------------------------------------------------------
1,116,000 Repurchase Agreement with Donaldson,
Lufkin & Jenrette dated 12/29/95 at 5.85%,
to be repurchased on 1/2/96 at $1,116,725,
collateralized by a $1,038,000 U.S. Treasury
Note, 8.125%, 2/15/98 (Cost $1,116,000) ............ 1,116,000
----------
---------------------------------------------------------------------------------
3.9% CONVERTIBLE BONDS
---------------------------------------------------------------------------------
AUSTRALIA 0.6% 800,000 Golden Shamrock Mines Ltd., 7.5%, 5/9/00 ............. 744,000
CANADA ----------
0.9% 500,000 Dayton Mining Corp., 7%, 1/31/99 ..................... 910,000
225,000 Texas Star Resources Corp., 8%, 11/16/96 (c) ......... 164,805
----------
1,074,805
----------
UNITED 2.4% 500,000 Bema Gold Corp., 7.5%, 2/28/00 ....................... 560,000
STATES 2,500,000 Horsham Corp., 3.25%, 12/10/18 ....................... 2,262,500
----------
2,822,500
----------
TOTAL CONVERTIBLE BONDS (Cost $4,376,768) ............ 4,641,305
----------
---------------------------------------------------------------------------------
86.4% COMMON STOCKS
---------------------------------------------------------------------------------
Shares
---------------------------------------------------------------------------------
AUSTRALIA 11.4% 600,000 Acacia Resources Ltd.* (Gold and mineral
exploration company with operations
throughout Australia) .............................. 1,079,199
1,000,000 Climax Mining Ltd.* (Gold exploration
company in Australia and the Philippines
Islands) ........................................... 921,630
500,000 Delta Gold NL* (Emerging junior exploration
company with important platinum property
in Zimbabwe) ....................................... 1,211,498
2,500,000 Gold Mines of Kalgoorlie (Major gold producer) ....... 2,322,657
413,992 Newcrest Mining, Ltd. (Senior gold
producer and exploration company) .................. 1,741,580
550,000 Orion Resources (Junior exploration company) ......... 715,378
1,133,976 Poseidon Gold Ltd. (Growing Tier III gold
producer) .......................................... 2,258,779
700,000 Ranger Minerals NL* (Gold producer and
exploration company in Ghana) ...................... 1,508,798
1,600,000 Ross Mining NL (Junior exploration company) .......... 1,510,284
----------
13,269,803
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
INVESTMENT PORTFOLIO
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF MARKET
PORTFOLIO SHARES VALUE ($)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CANADA 51.4% 200,000 Agnico-Eagle Mines, Ltd. (Silver and gold
mining) ............................................ 2,508,698
700,000 Arequipa Resources Ltd. (Exploration
company in Peru)* .................................. 1,204,908
150,000 Arequipa Resources Ltd. Warrants*
(expire 1/14/97) (c) ............................... 122,615
107,399 Barrick Gold Corp. (Gold exploration and
production in North and South America) ............. 2,832,649
241,500 Bema Gold Corp.* (Partner in development
of large Chilean gold deposit) ..................... 468,760
786,600 Bolivar Goldfields Ltd. (Gold exploration
company in Venezuela) .............................. 432,119
85,000 Bre-X Minerals Ltd. (Gold exploration
company in Indonesia) .............................. 3,299,762
325,000 Cambior, Inc. (Medium-sized gold producer
with a major mine in Guyana) ....................... 3,541,018
775,600 Canarc Resources Corp. (Exploration and
development company) ............................... 795,342
415,700 Carson Gold Corp. (Gold exploration and
development company operating in
Venezuela) ......................................... 420,191
400,000 Chase Resource Corp. (Acquisition,
exploration and development of resource
mineral properties) ................................ 468,779
214,000 Corriente Resources, Inc. Special Warrants*
(expire 2/9/96) (Exploration and development
company operating in Bolivia) (c) .................. 418,125
250,000 Crown Butte Resources Ltd. (Small
exploration company holding an important
gold deposit in Montana) ........................... 292,987
200,000 Crystallex International Corp. (Junior
company developing gold property in
Venezuela) ......................................... 342,794
267,000 Crystallex International Corp. Units* (expire
9/29/96) (c) (d) ................................... 579,861
400,000 Da Capo Resources Ltd. (Mineral exploration
and development company in Bolivia) ................ 732,467
200,000 Dayton Mining Corp. (Junior company
developing Chilean gold deposits) .................. 842,337
97,400 Dundee Bancorp Inc. "A" (Junior mine
finance and holding company) ....................... 980,956
823,800 Ecuadorian Minerals Corp. (Exploration
company in Ecuador) ................................ 893,041
1,074,000 El Callao Mining Corp. (Gold exploration
and development company with interests
in Venezuela) ...................................... 472,001
</TABLE>
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
SCUDDER GOLD FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF MARKET
PORTFOLIO SHARES VALUE ($)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
100,000 Euro-Nevada Mining, Ltd. (Large North
American royalty owner) ............................ 3,644,021
384,287 Golden Knight Resources, Inc. (Junior gold
producer, with recently opened mine in
Quebec) ............................................ 2,216,634
117,188 Golden Knight Resources, Inc. Warrants*
(expire 10/6/96) ................................... 30,043
300,000 Golden Star Resources Ltd. (Junior company,
with permits in North and South America
and West Africa) ................................... 1,593,115
700,000 Granges, Inc. (Emerging junior gold producer
and exploration company)* .......................... 1,153,635
360,000 Guyanor Resources S.A. "B" (Company
holding interests in mineral properties in
French Guiana)* .................................... 896,539
448,500 Hemlo Gold Mines, Inc. (Large gold
producer, with single mine in Ontario;
active exploration company) ........................ 4,270,646
400,000 International Gold Resources Corp.
(Exploration company in Ghana) ..................... 1,054,752
300,000 Jordex Resources, Inc. (Operator of two
mines producing zinc, lead and silver) (c) ......... 344,992
100,000 Kazakhstan Minerals Corp. Warrants* (expire
11/30/96) (Joint venturing in Kazakhstan) (c) ...... 847,000
325,000 Kinross Gold Corp.* (Gold mining company,
with interests in Zimbabwe) ........................ 2,529,299
550,000 Minera Rayrock Inc. "A" (Company
developing a low cost property in Chile) ........... 543,856
100,000 Minera Rayrock Inc. "B" .............................. 97,052
400,000 Namibian Minerals Corp. (Diamond
exploration and development company,
offshore Namibia) .................................. 629,921
125,000 Namibian Minerals Corp. Warrants* (expire
1/13/96) (c) ....................................... --
300,000 Orvana Minerals Corp. (International
exploration and development company) ............... 1,153,635
40,000 Pan African Resources Corp. (Gold
exploration in West Africa) (c) .................... 20,509
400,000 Pangea Goldfields Inc. (Gold exploration
company operating in Tanzania) ..................... 585,973
125,000 Placer Dome Inc. (International gold, silver
and copper mining) ................................. 3,015,625
300,000 Rayrock Yellowknife Resources, Inc. (Junior
diversified mineral producer with operations
in Nevada, Canada and Latin America) ............... 2,252,335
300,000 Redfern Resources Ltd. (Exploration
company in British Columbia) ....................... 395,532
</TABLE>
The accompanying notes are an integral part of the financial statements.
12
<PAGE>
INVESTMENT PORTFOLIO
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF MARKET
PORTFOLIO SHARES VALUE ($)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
622,700 Repadre Capital Corp. (Junior gold royalty
company) ......................................... 1,687,596
518,300 Solitario Resources Corp. (Precious and
base metals exploration company primarily
in Argentina and Peru) ........................... 759,275
7,053 Solitario Resources Corp. Warrants* (expire
3/3/96) (c) ...................................... 723
650,000 South Pacific Resources Warrants* (expire
2/28/96) (Exploration company in
Indonesia) (c) ................................... 2,289,545
125,000 Southwestern Gold Corp. (Multiple gold and
gold/copper exploration properties in Peru)* ..... 709,577
400,000 TVX Gold, Inc. (International gold and silver
mining) .......................................... 2,819,996
350,000 Texas Star Resources Corp. (Diamond
exploration in Arkansas and northern
Canada) .......................................... 76,909
400,000 Triton Mining Corp. (Exploration and
development of mineral properties in
Central and South America) ....................... 1,501,556
270,000 Viceroy Resources Corp. (Gold producer in
California) ...................................... 1,186,596
----------
59,956,297
----------
South Africa 1.3% 246,901 Potgietersrust Platinum Holdings, Ltd.
(Leading platinum producer) ...................... 1,490,007
----------
United States 22.3% 200,000 Ashanti Goldfields Co., Ltd. (ADS) (World
class gold producer in Ghana) .................... 4,025,000
304,000 Crown Resources Corp.* (Gold, silver and
mineral exploration company) ..................... 1,501,000
200,000 FMC Gold Co. (Medium-sized producer of
gold and silver in Nevada) ....................... 825,000
65,000 FirstMiss Gold Inc.* (Gold mining in Nevada) ....... 1,446,250
150,000 Homestake Mining Co. (Major international
gold producer) ................................... 2,343,750
60,000 Newmont Mining Corp. (International gold
exploration and mining company) .................. 2,715,000
759,000 Piedmont Mining Co.* (Gold and mining
development company in the Carolinas) ............ 308,344
150,000 Pioneer Group Inc. (Fund management
company owning major gold producer in
Ghana) ........................................... 4,087,500
300,001 Santa Fe Pacific Gold Corp. (Major
domestic gold mining company) .................... 3,637,510
</TABLE>
The accompanying notes are an integral part of the financial statements.
13
<PAGE>
SCUDDER GOLD FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
% OF MARKET
PORTFOLIO SHARES VALUE ($)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
270,000 Stillwater Mining Co.* (Exploration and
development of mines in Montana
producing platinum, palladium and
associated metals) (e) .............................. 5,197,500
-----------
26,086,854
-----------
TOTAL COMMON STOCKS (Cost $92,588,391) 100,802,961
-----------
</TABLE>
================================================================================
<TABLE>
<CAPTION>
% of Market
Net Assets Value ($)
------------------------
<S> <C> <C>
INVESTMENT PORTFOLIO (Cost $98,081,159) (a) 91.3 106,560,266
SCUDDER PRECIOUS METALS, INC. (NOTE A):
GOLD* (Cost $8,493,768) (b) 7.3 8,511,097
PLATINUM* (Cost $899,757) (b) 0.8 969,088
OTHER ASSETS AND LIABILITIES, NET 0.6 732,043
----- -----------
NET ASSETS 100.0 116,772,494
===== ===========
</TABLE>
* Non-income producing security or commodity.
(a) The cost for federal income tax purposes was $102,799,377. At December 31,
1995, net unrealized appreciation for all investment securities based on
tax cost was $3,760,889. This consisted of aggregate gross unrealized
appreciation for all investments in which there was an excess of market
value over tax cost of $20,778,814 and aggregate gross unrealized
depreciation for all investment securities in which there was an excess of
tax cost over market value of $17,017,925.
(b) The cost of Gold for federal income tax purposes was $8,493,768. At
December 31, 1995, gross and net unrealized appreciation was $17,329 based
on tax cost. The cost of Platinum for federal income tax purposes was
$899,757. At December 31, 1995, gross and net unrealized appreciation was
$69,331 based on tax cost.
(c) Securities valued in good faith by the Valuation Committee of the Board of
Directors. The cost for these securities at December 31, 1995, aggregated
$2,478,638. See Note A of the Notes to Consolidated Financial Statements.
(d) 1 Unit = 1 common share and 1 warrant.
(e) Restricted Securities - securities which have not been registered with the
Securities and Exchange Commission under the Securities Act of 1933.
Information concerning such restricted securities at December 31, 1995 is
as follows:
<TABLE>
<CAPTION>
Security Shares Acquisition Date Cost ($)
-------- ------ ---------------- --------
<S> <C> <C> <C> <C>
Stillwater Mining Co. 165,454 9/12/94 970,669
</TABLE>
See page 5 for the breakdown of the Fund's common stocks.
The accompanying notes are an integral part of the financial statements.
14
<PAGE>
CONSOLIDATED FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES
- ----------------------------------------------------------------------------------------------------------------
DECEMBER 31, 1995
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investments, at market (identified cost $98,081,159) (Note A) ........... $106,560,266
Gold, at market, 21,975.463 oz. (identified cost $8,493,768) (Note A) ... 8,511,097
Platinum, at market, 2,433.672 oz. (identified cost $899,757) (Note A) .. 969,088
Cash .................................................................... 899
Receivables:
Investments sold ................................................ 1,237,500
Dividends and interest .......................................... 95,733
Fund shares sold ................................................ 374,883
Other assets ............................................................ 2,649
------------
Total assets ............................................ 117,752,115
LIABILITIES
Payables:
Fund shares redeemed ............................................ $736,147
Accrued management fee (Note C) ................................. 102,145
Other accrued expenses (Note C) ................................. 141,329
--------
Total liabilities 979,621
------------
Net assets, at market value ............................................. $116,772,494
============
Net Assets
Net assets consist of:
Accumulated distributions in excess of net investment income .... $(13,388,480)
Net unrealized appreciation (depreciation) on:
Investment securities ................................... 8,479,107
Gold .................................................... 17,329
Platinum ................................................ 69,331
Foreign currency related transactions ................... (124)
Accumulated net realized gains .................................. 3,357,669
Capital stock ................................................... 101,241
Additional paid-in capital ...................................... 118,136,421
------------
Net assets, at market value ............................................. $116,772,494
============
Net asset value, offering and redemption price per share
($116,772,494 divided by 10,124,066 shares of
capital stock outstanding, $.01 par value,
100,000,000 shares of capital stock authorized) ................. $ 11.53
============
</TABLE>
The accompanying notes are an integral part of the financial statements.
15
<PAGE>
SCUDDER GOLD FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF OPERATIONS
- ----------------------------------------------------------------------------------------------------------------
SIX MONTHS ENDED DECEMBER 31, 1995
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME
Dividends (net of withholding taxes of $34,913) $ 372,372
Interest (net of withholding taxes of $2,439) 237,128
-----------
609,500
Expenses:
Management fee (Note C) $ 607,427
Services to shareholders (Note C) 157,408
Custodian and accounting fees (Note C) 58,444
Directors' fees (Note C) 11,850
Auditing 44,700
Reports to shareholders 36,490
State registration 27,569
Legal 8,940
Other 12,429 965,257
--------------------------
Net investment loss (355,757)
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENT TRANSACTIONS
Net realized gain (loss) from:
Investment securities 8,841,008
Gold (56,279)
Platinum 40,000
Foreign currency related transactions (2,775) 8,821,954
-----------
NET UNREALIZED APPRECIATION (DEPRECIATION) DURING THE PERIOD ON:
Investment securities (4,896,507)
Gold 51,099
Platinum (158,251)
Foreign currency related transactions (439) (5,004,098)
--------------------------
Net gain on investment transactions 3,817,856
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 3,462,099
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
16
<PAGE>
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
DECEMBER 31, JUNE 30,
INCREASE (DECREASE) IN NET ASSETS 1995 1995
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment loss .......................................... $ (355,757) $ (890,406)
Net realized gain from investment transactions ............... 8,821,954 3,275,125
Net unrealized appreciation (depreciation) on investment
transactions during the period ....................... (5,004,098) 5,187,427
------------- -------------
Net increase in net assets resulting from operations ......... 3,462,099 7,572,146
------------- -------------
Distributions to shareholders:
In excess of net investment income ($1.08 and $.25 per
share, respectively) ................................. (10,004,029) (2,869,449)
------------- -------------
From net realized gains from investment
transactions ($.63 and $.47 per share, respectively) . (5,863,581) (5,245,021)
------------- -------------
Fund share transactions:
Proceeds from shares sold .................................... 49,182,094 143,035,136
Net asset value of shares issued to shareholders
in reinvestment of distributions ..................... 14,863,510 7,611,778
Cost of shares redeemed ...................................... (61,278,289) (153,550,282)
------------- -------------
Net increase (decrease) in net assets from Fund
share transactions ................................... 2,767,315 (2,903,368)
------------- -------------
DECREASE IN NET ASSETS ....................................... (9,638,196) (3,445,692)
Net assets at beginning of period ............................ 126,410,690 129,856,382
------------- -------------
NET ASSETS AT END OF PERIOD (including accumulated
distributions in excess of net investment income of
$13,388,480 and $3,028,694, respectively) ............ $ 116,772,494 $ 126,410,690
============= =============
OTHER INFORMATION
INCREASE (DECREASE) IN FUND SHARES
Shares outstanding at beginning of period .................... 9,826,603 10,277,443
------------- -------------
Shares sold .................................................. 3,899,533 11,733,937
Shares issued to shareholders in reinvestment of distributions 1,267,675 589,031
Shares redeemed .............................................. (4,869,745) (12,773,808)
------------- -------------
Net increase (decrease) in Fund shares ....................... 297,463 (450,840)
------------- -------------
Shares outstanding at end of period .......................... 10,124,066 9,826,603
============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
17
<PAGE>
SCUDDER GOLD FUND
CONSOLIDATED FINANCIAL HIGHLIGHTS
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the financial
statements.
<TABLE>
<CAPTION>
FOR THE PERIOD
SEPTEMBER 2, 1988
SIX MONTHS (COMMENCEMENT
ENDED OF OPERATIONS)
DECEMBER 31, YEARS ENDED JUNE 30, TO JUNE 30,
--------------------------------------------------------
1995(b) 1995(b) 1994(b) 1993(b) 1992(b) 1991 1990 1989
------------ -------------------------------------------------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ...................... $12.86 $12.64 $12.13 $9.19 $9.87 $10.21 $10.58 $12.00
------ ------ ------ ----- ----- ------ ------ ------
Income from investment
operations:
Net investment income
(loss) (a) .................. (.04) (.08) (.10) (.08) (.12) (.04) .07 (.06)
Net realized and unrealized
gain (loss) on investment
transactions ................ .42 1.02 .85 3.02 (.56) (.30) (.34) (1.36)
------ ------ ------ ----- ----- ------ ------ ------
Total from investment
operations ..................... .38 .94 .75 2.94 (.68) (.34) (.27) (1.42)
------ ------ ------ ----- ----- ------ ------ ------
Less distributions:
From net investment income ..... -- -- -- -- -- -- (.01) --
In excess of net investment
income ...................... (1.08) (.25) (.24) -- -- -- -- --
From net realized gains on
investment transactions ..... (.63) (.47) -- -- -- -- (.03) --
From additional paid-in capital -- -- -- -- -- -- (.06) --
------ ------ ------ ----- ----- ------ ------ ------
Total distributions ............ (1.71) (.72) (.24) -- -- -- (.10) --
------ ------ ------ ----- ----- ------ ------ ------
Net asset value, end of period . $11.53 $12.86 $12.64 $12.13 $9.19 $9.87 $10.21 $10.58
====== ====== ====== ====== ===== ===== ====== ======
TOTAL RETURN (%) ................... 2.97** 7.50 6.35 31.99 (6.89) (3.33) (2.71) (11.83)**
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
($ millions) ................... 117 126 130 90 31 33 17 9
Ratio of operating expenses,
net to average daily net
assets (%) (a) ................. 1.59* 1.65 1.69 2.17 2.54 2.54 2.60 3.00*
Ratio of net investment income
(loss) to average daily net
assets (%) ..................... (.59)* (.69) (.81) (.81) (1.34) (.59) .34 (1.06)*
Portfolio turnover rate (%) ........ 13.2* 42.0 50.8 59.2 57.5 71.4 80.6 34.5*
(a) Reflects a per share amount
of expenses reimbursed by
the Adviser of .............. $-- $-- $-- $-- $-- $.02 $.20 $.18
Operating expense ratio
before expense reductions (%) -- -- -- -- 2.57 2.82 3.74 6.59*
</TABLE>
(b) Based on monthly average shares outstanding during the period.
* Annualized
** Not annualized
18
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. SIGNIFICANT ACCOUNTING POLICIES
- --------------------------------------------------------------------------------
Scudder Gold Fund (the "Fund") is a non-diversified series of Scudder Mutual
Funds, Inc. (the "Corporation"). The Corporation is a Maryland corporation,
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company. The policies described below are followed
consistently by the Fund in the preparation of its financial statements in
conformity with generally accepted accounting principles.
PRINCIPLES OF CONSOLIDATION. The consolidated financial statements of the Fund
include the accounts of the Fund and Scudder Precious Metals, Inc., a
wholly-owned subsidiary of the Corporation, whose principal assets are precious
metals. All intercompany accounts and transactions have been eliminated.
SECURITY VALUATION. Portfolio securities which are traded on U.S. or foreign
stock exchanges are valued at the most recent sale price reported on the
exchange on which the security is traded most extensively. If no sale occurred,
the security is then valued at the calculated mean between the most recent bid
and asked quotations. If there are no such bid and asked quotations, the most
recent bid quotation is used. Securities quoted on the National Association of
Securities Dealers Automatic Quotation ("NASDAQ") System, for which there have
been sales, are valued at the most recent sale price reported on such system. If
there are no such sales, the value is the high or "inside" bid quotation.
Securities which are not quoted on the NASDAQ System but are traded in another
over-the-counter market are valued at the most recent sale price on such market.
If no sale occurred, the security is then valued at the calculated mean between
the most recent bid and asked quotations. If there are no such bid and asked
quotations, the most recent bid quotation shall be used.
Portfolio debt securities with remaining maturities greater than sixty days are
valued by pricing agents approved by the Officers of the Fund, which prices
reflect broker/dealer-supplied valuations and electronic data processing
techniques. If the pricing agents are unable to provide such quotations, the
most recent bid quotation supplied by a bona fide market maker shall be used.
Short-term investments having a maturity of sixty days or less are valued at
amortized cost. All other securities are valued at their fair value as
determined in good faith by the Valuation Committee of the Board of Directors.
Securities valued in good faith by the Valuation Committee of the Board of
Directors at
19
<PAGE>
SCUDDER GOLD FUND
- --------------------------------------------------------------------------------
fair value amounted to $4,788,175 (4.1% of net assets) and have been noted in
the investment portfolio as of December 31, 1995.
RESTRICTED SECURITIES. The Fund may not purchase restricted securities (for
these purposes, restricted security means a security which cannot be sold to the
public without registration under the Securities Act of 1933 or the availability
of an exemption from registration, or which is subject to other legal or
contractual delays in or restrictions on resale), if, as a result thereof, more
than 10% of the value of the Fund's total assets would be invested in restricted
securities. The aggregate fair value of restricted securities at December 31,
1995 amounted to $3,184,990 which represents 2.7% of net assets.
PRECIOUS METALS VALUATION. Gold bullion will be valued on quotations obtained
from U.S. dealers and on the London afternoon gold price. Precious metals other
than gold will be valued on current prices provided by market makers.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian,
receives delivery of the underlying securities, the amount of which at the time
of purchase and each subsequent business day is required to be maintained at
such a level that the market value, depending on the maturity of the repurchase
agreement and the underlying collateral, is equal to at least 100.5% of the
resale price.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currency transactions are translated into U.S. dollars
on the following basis:
(i) market value of investment securities, other assets and liabilities at
the daily rates of exchange, and
(ii) purchases and sales of investment securities, dividend and interest
income and certain expenses at the rates of exchange prevailing on the
respective dates of such transactions.
The Fund does not isolate that portion of gains and losses on investments which
is due to changes in foreign exchange rates from that which is due to changes in
market prices of the investments. Such fluctuations are included with the net
realized and unrealized gains and losses from investments.
20
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Net realized and unrealized gain (loss) from foreign currency related
transactions includes gains and losses between trade and settlement dates on
securities transactions, gains and losses arising from the sales of foreign
currency, and gains and losses between the ex and payment dates on dividends,
interest, and foreign withholding taxes.
FEDERAL INCOME TAXES. The Fund's policy is to comply with the requirements of
the Internal Revenue Code which are applicable to regulated investment
companies, and to distribute all of its taxable income to its shareholders. The
Fund paid no federal income taxes and no federal income tax provision was
required.
DISTRIBUTION OF INCOME AND GAINS. Distributions of net investment income are
made annually. During any particular year net realized gains from investment
transactions, in excess of available capital loss carryforwards, would be
taxable to the Fund if not distributed and, therefore, will be distributed to
shareholders. An additional distribution may be made to the extent necessary to
avoid the payment of a four percent federal excise tax. The Fund uses the
identified cost method for determining realized gain or loss on investments for
both financial and federal income tax reporting purposes.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with federal tax regulations
which may differ from generally accepted accounting principles. These
differences relate primarily to investments in Passive Foreign Investment
Companies. As a result, net investment income (loss) and net realized gain
(loss) on investment transactions for a reporting period may differ
significantly from distributions during such period. Accordingly, the Fund may
periodically make reclassifications among certain of its capital accounts
without impacting the net asset value of the Fund.
OTHER. Investment security and precious metals transactions are accounted for on
a trade date basis. Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. All original issue discounts are accreted for both tax and financial
reporting purposes.
21
<PAGE>
SCUDDER GOLD FUND
- --------------------------------------------------------------------------------
B. PURCHASES AND SALES
- --------------------------------------------------------------------------------
For the six months ended December 31, 1995, purchases and sales of investment
securities (excluding short-term investments) aggregated $7,248,565 and
$23,258,821, respectively. During the six months ended December 31, 1995,
purchases and sales of gold aggregated $6,173,328 and $1,950,241, respectively;
and sales of platinum aggregated $430,000.
C. RELATED PARTIES
- --------------------------------------------------------------------------------
Under the Fund's Investment Advisory Agreement (the "Agreement") with Scudder,
Stevens & Clark, Inc. (the "Adviser"), the Fund agrees to pay to the Adviser a
fee equal to an annual rate of 1% of the Fund's average net assets, computed and
accrued daily and payable monthly. For the six months ended December 31, 1995,
the fee pursuant to the Agreement amounted to $607,427. However, the Adviser
agreed to absorb a portion of expenses in order to maintain the annualized
expenses of the Fund at not more than 3% of the average net assets until October
31, 1995. The Adviser did not absorb any expenses for the six months ended
December 31, 1995. The Agreement also provides that if the Fund's expenses,
exclusive of taxes, interest and extraordinary expenses, exceed the lowest
applicable state expense limitation, such excess up to the amount of the
management fee will be paid by the Adviser.
Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend paying and shareholder service agent. For the six months
ended December 31, 1995, the amount charged to the Fund by SSC aggregated
$129,734, of which $21,928 is unpaid at December 31, 1995.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records of the Fund. For the six months
ended December 31, 1995, the amount charged to the Fund by SFAC aggregated
$21,795, of which $3,490 is unpaid at December 31, 1995.
The Fund pays each Director not affiliated with the Adviser $4,000 annually,
plus specified amounts for attended board and committee meetings. For the six
months ended December 31, 1995, Directors' fees and expenses aggregated $11,850.
22
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
D. LETTER OF CREDIT
- --------------------------------------------------------------------------------
The Fund and several affiliated Funds ("the Participants") share in a $500
million revolving credit facility for temporary or emergency purposes, including
the meeting of redemption requests that otherwise might require the untimely
disposition of securities. The Participants are charged an annual commitment fee
which is allocated among each of the Participants. Interest is calculated based
on the market rates at the time of the borrowing. The Fund may borrow up to a
maximum of 33 percent of its net assets under the agreement. In addition, the
Fund also maintains an uncommitted line of credit.
23
<PAGE>
SCUDDER GOLD FUND
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
TO THE BOARD OF DIRECTORS OF SCUDDER MUTUAL FUNDS, INC. AND THE SHAREHOLDERS
OF SCUDDER GOLD FUND:
We have audited the accompanying consolidated statement of assets and
liabilities of Scudder Gold Fund, including the investment portfolio, as of
December 31, 1995, and the related consolidated statement of operations for the
six-month period then ended, the consolidated statements of changes in net
assets for the six-month period then ended and for the year ended June 30, 1995,
and the consolidated financial highlights for the six-month period ended
December 31, 1995, for each of the six years in the period ended June 30, 1995,
and for the period September 2, 1988 (commencement of operations) to June 30,
1989. These financial statements and financial highlights are the responsibility
of the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities and precious
metals owned as of December 31, 1995, by correspondence with the custodians 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 consolidated financial
position of Scudder Gold Fund as of December 31, 1995, the consolidated results
of its operations for the six-month period then ended, the consolidated changes
in its net assets for the six-month period then ended and for the year ended
June 30, 1995, and the consolidated financial highlights for the six-month
period ended December 31, 1995, for each of the six years in the period ended
June 30, 1995, and for the period September 2, 1988 (commencement of operations)
to June 30, 1989 in conformity with generally accepted accounting principles.
Boston, Massachusetts COOPERS & LYBRAND L.L.P.
February 2, 1996
24
<PAGE>
TAX INFORMATION
By now shareholders to which year-end tax reporting is required by the IRS
should have received their Form 1099-DIV and tax information letter from the
Fund.
Please consult a tax adviser if you have any questions about federal or state
income tax laws, or on how to prepare your tax returns. If you have specific
questions about your Scudder Fund account, please call a Scudder Investor
Relations Representative at 1-800-225-5163.
OFFICERS AND DIRECTORS
Daniel Pierce*
President and Director
Thomas J. Devine
Director; Consultant
Keith R. Fox
Director
Dr. Gordon Shillinglaw
Director; Professor Emeritus of Accounting, Columbia University
Graduate School of Business
Douglas M. Loudon*
Vice President and Director
Robert G. Stone, Jr.
Honorary Director; Chairman of the Board, Kirby Corporation
Jerard K. Hartman*
Vice President
Thomas W. Joseph*
Vice President
David S. Lee*
Vice President
Thomas F. McDonough*
Vice President and Secretary
Pamela A. McGrath*
Vice President and Treasurer
Edward J. O'Connell*
Vice President and Assistant Treasurer
Juris Padegs*
Vice President and Assistant Secretary
Kathryn L. Quirk*
Vice President and Assistant Secretary
Coleen Downs Dinneen*
Assistant Secretary
* Scudder, Stevens & Clark, Inc.
25
<PAGE>
INVESTMENT PRODUCTS AND SERVICES
<TABLE>
<CAPTION>
The Scudder Family of Funds
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Money Market Income
Scudder Cash Investment Trust Scudder Emerging Markets Income Fund
Scudder U.S. Treasury Money Fund Scudder Global Bond Fund
Tax Free Money Market+ Scudder GNMA Fund
Scudder Tax Free Money Fund Scudder Income Fund
Scudder California Tax Free Money Fund* Scudder International Bond Fund
Scudder New York Tax Free Money Fund* Scudder Short Term Bond Fund
Tax Free+ Scudder Zero Coupon 2000 Fund
Scudder California Tax Free Fund* Growth
Scudder High Yield Tax Free Fund Scudder Capital Growth Fund
Scudder Limited Term Tax Free Fund Scudder Development Fund
Scudder Managed Municipal Bonds Scudder Global Fund
Scudder Massachusetts Limited Term Tax Free Fund* Scudder Global Small Company Fund
Scudder Massachusetts Tax Free Fund* Scudder Gold Fund
Scudder Medium Term Tax Free Fund Scudder Greater Europe Growth Fund
Scudder New York Tax Free Fund* Scudder International Fund
Scudder Ohio Tax Free Fund* Scudder Latin America Fund
Scudder Pennsylvania Tax Free Fund* Scudder Pacific Opportunities Fund
Growth and Income Scudder Quality Growth Fund
Scudder Balanced Fund Scudder Small Company Value Fund
Scudder Growth and Income Fund Scudder Value Fund
The Japan Fund
Retirement Plans and Tax-Advantaged Investments
-----------------------------------------------------------------------------------------------------------------
IRAs 403(b) Plans
Keogh Plans SEP-IRAs
Scudder Horizon Plan+++* (a variable annuity) Profit Sharing and Money Purchase
401(k) Plans Pension Plans
Closed-End Funds#
-----------------------------------------------------------------------------------------------------------------
The Argentina Fund, Inc. The Latin America Dollar Income Fund, Inc.
The Brazil Fund, Inc. Montgomery Street Income Securities, Inc.
The First Iberian Fund, Inc. Scudder New Asia Fund, Inc.
The Korea Fund, Inc. Scudder New Europe Fund, Inc.
Scudder World Income
Opportunities Fund, Inc.
Institutional Cash Management
-----------------------------------------------------------------------------------------------------------------
Scudder Institutional Fund, Inc. Scudder Treasurers Trust(TM)++
Scudder Fund, Inc.
-----------------------------------------------------------------------------------------------------------------
<FN>
For complete information on any of the above Scudder funds, including
management fees and expenses, call or write for a free prospectus. Read it
carefully before you invest or send money. +A portion of the income from the
tax-free funds may be subject to federal, state, and local taxes. *Not
available in all states. +++A no-load variable annuity contract provided by
Charter National Life Insurance Company and its affiliate, offered by
Scudder's insurance agencies, 1-800-225-2470. #These funds, advised by
Scudder, Stevens & Clark, Inc. are traded on various stock exchanges. ++For
information on Scudder Treasurers Trust,(TM) an institutional cash
management service that utilizes certain portfolios of Scudder Fund, Inc.
($100,000 minimum), call 1-800-541-7703.
</FN>
</TABLE>
26
<PAGE>
HOW TO CONTACT SCUDDER
<TABLE>
<CAPTION>
<S> <C>
Account Service and Information
-------------------------------------------------------------------------------------------------------------
For existing account service and transactions
SCUDDER INVESTOR RELATIONS
1-800-225-5163
For personalized information about your Scudder accounts;
exchanges and redemptions; or information on any Scudder fund
SCUDDER AUTOMATED INFORMATION LINE (SAIL)
1-800-343-2890
Investment Information
-------------------------------------------------------------------------------------------------------------
To receive information about the Scudder funds, for additional
applications and prospectuses, or for investment questions
SCUDDER INVESTOR RELATIONS
1-800-225-2470
For establishing 401(k) and 403(b) plans
SCUDDER DEFINED CONTRIBUTION SERVICES
1-800-323-6105
Please address all correspondence to
-------------------------------------------------------------------------------------------------------------
THE SCUDDER FUNDS
P.O. BOX 2291
BOSTON, MASSACHUSETTS
02107-2291
Or stop by a Scudder Funds Center
-------------------------------------------------------------------------------------------------------------
Many shareholders enjoy the personal, one-on-one service of the
Scudder Funds Centers. Check for a Funds Center near you--they can
be found in the following cities:
Boca Raton New York
Boston Portland, OR
Chicago San Diego
Cincinnati San Francisco
Los Angeles Scottsdale
-------------------------------------------------------------------------------------------------------------
For information on Scudder For information on Scudder
Treasurers Trust,(TM)an institutional Institutional Funds,* funds
cash management service for designed to meet the broad
corporations, non-profit investment management and
organizations and trusts that uses service needs of banks and
certain portfolios of Scudder Fund, other institutions, call
Inc.* ($100,000 minimum), call 1-800-854-8525.
1-800-541-7703.
-------------------------------------------------------------------------------------------------------------
Scudder Investor Relations and Scudder Funds Centers are services provided
through Scudder Investor Services, Inc., Distributor.
<FN>
* Contact Scudder Investor Services, Inc., Distributor, to receive a
prospectus with more complete information, including management fees and
expenses. Please read it carefully before you invest or send money.
</FN>
</TABLE>
27
<PAGE>
Celebrating Over 75 Years of Serving Investors
Established in 1919 by Theodore Scudder, Sidney Stevens, and F. Haven Clark,
Scudder, Stevens & Clark was the first independent investment counsel firm in
the United States. Since its birth, Scudder's pioneering spirit and commitment
to professional long-term investment management have helped shape the investment
industry. In 1928, we introduced the nation's first no-load mutual fund. Today
we offer 37 pure no load(TM) funds, including the first international mutual
fund offered to U.S. investors.
Over the years, Scudder's global investment perspective and dedication to
research and fundamental investment disciplines have helped us become one of the
largest and most respected investment managers in the world. Though times have
changed since our beginnings, we remain committed to our long-standing
principles: managing money with integrity and distinction; keeping the interests
of our clients first; providing access to investments and markets that may not
be easily available to individuals; and making investing as simple and
convenient as possible through friendly, comprehensive service.
