TAX EXEMPT MONEY FUND OF AMERICA, 497, 2000-01-07

TAX EXEMPT MONEY FUND OF AMERICA
497, 2000-01-07

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PROSPECTUS SUPPLEMENT
January 10, 2000
for the following funds with prospectuses dated February 1, 1999 - December 1,
1999

<TABLE>
<CAPTION>
<S> <C>
AMCAP Fund, Inc. Limited Term Tax-Exempt Bond
American Balanced Fund, Inc. Fund of America
American High-Income Municipal The New Economy Fund
Bond Fund, Inc. New Perspective Fund, Inc.
American High-Income Trust SMALLCAP World Fund, Inc.
The Bond Fund of America, Inc. The Tax-Exempt Bond Fund of
Capital World Bond Fund, Inc. America, Inc.
Capital World Growth and The Tax-Exempt Fund of
Income Fund, Inc. California
The Cash Management Trust of The Tax-Exempt Fund of
America Maryland
EuroPacific Growth Fund The Tax-Exempt Fund of
Fundamental Investors, Inc. Virginia
The Growth Fund of America, The Tax-Exempt Money Fund
Inc. of America
The Income Fund of America, U.S. Government Securities
Inc. Fund
Intermediate Bond Fund of The U.S. Treasury Money Fund
America of America
The Investment Company of Washington Mutual Investors
America Fund, Inc.
</TABLE>

The initial investment minimum for all funds in The American Funds Group(r),
except the money market funds and the state tax-exempt funds, is now $250. The
initial investment minimum for the money market funds (The Cash Management
Trust of America, The Tax-Exempt Money Fund of America and The U.S. Treasury
Money Fund of America) and the state tax-exempt funds (The Tax-Exempt Fund of
California, The Tax-Exempt Fund of Maryland and The Tax-Exempt Fund of
Virginia) is $1,000.

In addition, effective January 10, 2000, the sales charges applied to purchases
of the equity and fixed-income funds in The American Funds Group are as
follows:

<TABLE>
<CAPTION>
EQUITY FUNDS FIXED-INCOME FUNDS

Sales Charge Dealer Sales Charge Dealer
as % of Concession as % of Concession
as a % of as a % of
Offering Offering
Price Price

AMOUNT OF SALE Offering Net Offering Net
Price Amount Price Amount
Invested Invested

<S> <C> <C> <C> <C> <C> <C>
Less than $25,000 5.75% 6.10% 5.00%

$25,000 but less than 5.00 5.26 4.25 3.75% 3.90% 3.00%
$50,000

$50,000 but less than 4.50 4.71 3.75
$100,000

$100,000 but less than 3.50 3.63 2.75 3.50 3.63 2.75
$250,000

$250,000 but less than 2.50 2.56 2.00 2.50 2.56 2.00
$500,000

$500,000 but less than 2.00 2.04 1.60 2.00 2.04 1.60
$750,000

$750,000 but less than 1.50 1.52 1.20 1.50 1.52 1.20
$1 million

$1 million and above none none see none none see
prospectus prospectus

</TABLE>

THE FUND PROVIDES SPANISH TRANSLATIONS IN CONNECTION WITH THE
PUBLIC OFFERING AND SALE OF ITS SHARES. THE FOLLOWING IS A FAIR
AND ACCURATE ENGLISH TRANSLATION OF A SPANISH LANGUAGE PROSPECTUS
FOR THE FUND.

/s/ Julie F. Williams
Julie F. Williams
Secretary

PROSPECTUS SUPPLEMENT
January 10, 2000
for the following funds with prospectuses dated February 1, 1999 - December 1,
1999

In addition, effective January 10, 2000, the sales charges applied to purchases
of the equity and fixed-income funds in The American Funds Group are as
follows:

<TABLE>
<CAPTION>
EQUITY FUNDS FIXED-INCOME FUNDS

Sales Charge Dealer Sales Charge Dealer
as % of Concession as % of Concession
as a % of as a % of
Offering Offering
Price Price

AMOUNT OF SALE Offering Net Offering Net
Price Amount Price Amount
Invested Invested

<S> <C> <C> <C> <C> <C> <C>
Less than $25,000 5.75% 6.10% 5.00%

$25,000 but less than 5.00 5.26 4.25 3.75% 3.90% 3.00%
$50,000

$50,000 but less than 4.50 4.71 3.75
$100,000

$100,000 but less than 3.50 3.63 2.75 3.50 3.63 2.75
$250,000

$250,000 but less than 2.50 2.56 2.00 2.50 2.56 2.00
$500,000

$500,000 but less than 2.00 2.04 1.60 2.00 2.04 1.60
$750,000

$750,000 but less than 1.50 1.52 1.20 1.50 1.52 1.20
$1 million

$1 million and above none none see none none see
prospectus prospectus

</TABLE>

<PAGE>
THE CASH MANAGEMENT TRUST OF AMERICA
AND
THE U.S. TREASURY MONEY FUND OF AMERICA
AND
THE TAX-EXEMPT MONEY FUND OF AMERICA

Part B
Statement of Additional Information

December 1, 1999
(as amended January 10, 2000)

This document is not a prospectus but should be read in conjunction with the
current prospectus of The Cash Management Trust of America ("CMTA"), The U.S.
Treasury Money Fund of America ("CTRS") and The Tax-Exempt Money Fund of America
("CTEX") dated December 1, 1999. The prospectus may be obtained from your
investment dealer or financial planner or by writing to the fund at the
following address:

The Cash Management Trust of America
The U.S. Treasury Money Fund of AmericaThe
Tax-Exempt Money Fund of America
Attention: Secretary
333 South Hope Street
Los Angeles, California 90071
(213) 486-9200

Shareholders who purchase shares at net asset value through eligible retirement
plans should note that not all of the services or features described below may
be available to them, and they should contact their employer for details.

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Item Page No.
- ---- --------
<S> <C>
Certain Investment Limitations and Guidelines . . . . . . . . . . . 2
Description of Certain Securities and Investment Techniques . . . . 3
Fundamental Policies and Investment Restrictions. . . . . . . . . . 7
Fund Organization and Voting Rights . . . . . . . . . . . . . . . . 13
Fund Trustees and Officers. . . . . . . . . . . . . . . . . . . . . 14
Management. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Dividends, Distributions and Taxes. . . . . . . . . . . . . . . . . 21
Purchase of Shares. . . . . . . . . . . . . . . . . . . . . . . . . 24
Selling Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Shareholder Account Services and Privileges . . . . . . . . . . . . 32
Execution of Portfolio Transactions . . . . . . . . . . . . . . . . 35
General Information . . . . . . . . . . . . . . . . . . . . . . . . 35
Investment Results and Related Statistics . . . . . . . . . . . . . 36
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Financial Statements
</TABLE>

Money Market Funds -- Page 1

<PAGE>

CERTAIN INVESTMENT LIMITATIONS AND GUIDELINES

The following limitations and guidelines are considered at the time of purchase,
under normal market conditions, and are based on a percentage of the fund's net
assets unless otherwise noted. This summary is not intended to reflect all of
the fund's investment limitations.

CASH MANAGEMENT TRUST OF AMERICA

DEBT SECURITIES

-The fund will invest substantially all of its assets in securities
rated in the highest short-term rating categories (i.e., Prime-1,
A-1).

MATURITY

-The fund's dollar-weighted average portfolio maturity will be
approximately 35 days or less.

U.S. TREASURY MONEY FUND

U.S. TREASURY SECURITIES

-The fund will invest substantially all of its assets in U.S. Treasury
securities.

MATURITY

-The fund's dollar-weighted average portfolio maturity will be
approximately 90 days or less.

TAX-EXEMPT MONEY FUND OF AMERICA

TAX-EXEMPT SECURITIES

-The fund will invest at least 80% of its assets in securities the
interest on which is exempt from federal income tax.

DEBT SECURITIES

-The fund may invest up to 20% of its assets in securities that are
subject to alternative minimum taxes.

-The fund will invest substantially all of its assets in securities
rated in the highest short-term rating categories (i.e., Prime-1,
A-1).

MATURITY

-The fund's dollar-weighted average portfolio maturity will be
approximately 60 days or less.

The fund may experience difficulty liquidating certain portfolio securities
during significant market declines or periods of heavy redemptions.

Money Market Funds -- Page 2

<PAGE>

DESCRIPTION OF CERTAIN SECURITIES AND INVESTMENT TECHNIQUES

The descriptions below are intended to supplement the material in the prospectus
under "Investment Objective, Strategies and Risks."

INVESTMENT POLICIES -- CMTA and CTEX may invest in securities that are rated in
the two highest rating categories for debt obligations by at least two
nationally recognized statistical rating organizations (or one rating
organization if the instrument was rated by only one such organization) or, if
unrated, are of comparable quality as determined in accordance with procedures
established by the Board of Trustees ("eligible securities"). The nationally
recognized statistical rating organizations currently rating instruments of the
type each fund may purchase are Moody's Investors Service, Inc., Standard &
Poor's Corporation, Duff and Phelps, Inc., Fitch Investors Service, Inc., and
IBCA Limited and IBCA Inc. Subsequent to its purchase, an issue of securities
may cease to be rated or its rating may be reduced below the minimum rating
required for its purchase. Neither event requires the elimination of such
securities from a fund's portfolio, but Capital Research and Management Company
(the "Investment Adviser") will consider such an event in its determination of
whether the fund should continue to hold the securities. Investments in
eligible securities not rated in the highest category by at least two rating
organizations (or one rating organization if the instrument was rated by only
one such organization), and unrated eligible securities not determined by the
Board of Trustees to be comparable quality to those rated in the highest
category, will be limited to 5% of a fund's total assets, with the investment in
any one such issuer being limited to no more than the greater of 1% of a fund's
total assets or $1,000,000. It is the current policy of CMTA and CTEX to invest
only in instruments rated in the highest short-term rating category by Moody's
Investors Service, Inc. and Standard & Poor's Corporation or in instruments that
do not have short-term ratings by Moody's or S&{ but determined to be of
comparable quality in accordance with U.S. Government, its agencies or
instrumentalities as to the payment of principal and interest. CTRS invests
exclusively in U.S. Treasury securities, which are of the highest credit
quality.

THE CASH MANAGEMENT TRUST OF AMERICA

CMTA may invest in the short-term securities described below:

COMMERCIAL PAPER: Short-term notes (usually maturing in 90 days or less) issued
by companies or governmental bodies.

COMMERCIAL BANK OBLIGATIONS: Certificates of deposit (interest-bearing time
deposits), bank notes, bankers' acceptances (time drafts drawn on a commercial
bank where the bank accepts an irrevocable obligation to pay at maturity)
representing direct or contingent obligations of commercial banks with assets in
excess of $1 billion, based on latest published reports, or obligations issued
by commercial banks with assets of less than $1 billion if the principal amount
of such obligation is fully insured by the U. S. Government. Commercial banks
issuing obligations in which CMTA invests must be on an approved list that is

monitored on a regular basis; currently all approved banks have assets in excess
of $10 billion.

SAVINGS ASSOCIATION OBLIGATIONS: Certificates of deposit (interest-bearing time
deposits) issued by savings banks or savings and loan associations that have
assets in excess of $1 billion, based on latest published reports, or
obligations issued by institutions with assets of less than $1 billion if the
principal amount of such obligation is fully insured by the U. S. Government.
Savings associations issuing obligations in which CMTA invests must be on an
approved list that

Money Market Funds -- Page 3

<PAGE>

is monitored on a regular basis; currently all approved savings associations
have assets in excess of $10 billion.

U.S. GOVERNMENT SECURITIES -- Securities guaranteed by the U.S. Government
include: (1) direct obligations of the U.S. Treasury (such as Treasury bills,
notes and bonds) and (2) federal agency obligations guaranteed as to principal
and interest by the U.S. Treasury. For these securities, the payment of
principal and interest is unconditionally guaranteed by the U.S. Government, and
thus they are of the highest possible credit quality. Such securities are
subject to variations in market value due to fluctuations in interest rates,
but, if held to maturity, will be paid in full.

Certain securities issued by U.S. Government instrumentalities and certain
federal agencies are neither direct obligations of, nor guaranteed by, the
Treasury. However, they generally involve federal sponsorship in one way or
another; some are backed by specific types of collateral; some are supported by
the issuer's right to borrow from the Treasury; some are supported by the
discretionary authority of the Treasury to purchase certain obligations of the
issuer; and others are supported only by the credit of the issuing government
agency or instrumentality. These agencies and instrumentalities include, but are
not limited to, Farmers Home Administration, Federal Home Loan Bank, Federal
Home Loan Mortgage Corporation, Federal National Mortgage Association, Tennessee
Valley Authority, and Federal Farm Credit Bank System.

REPURCHASE AGREEMENTS - The fund may enter into repurchase agreements, under
which it buys a security and obtains a simultaneous commitment from the seller
to repurchase the security at a specified time and price. Repurchase agreements
permit the fund to maintain liquidity and earn income over periods of time as
short as overnight. The seller must maintain with the fund's custodian
collateral equal to at least 100% of the repurchase price, including accrued
interest, as monitored daily by the Investment Adviser. The fund will only enter
into repurchase agreements involving securities in which it could otherwise
invest and with selected banks and securities dealers whose financial condition
is monitored by the Investment Adviser. If the seller under the repurchase
agreement defaults, the fund may incur a loss if the value of the collateral
securing the repurchase agreement has declined and may incur disposition costs
in connection with liquidating the collateral. If bankruptcy proceedings are
commenced with respect to the seller, realization upon the collateral by the
fund may be delayed or limited.

CORPORATE BONDS AND NOTES: Corporate obligations that mature, or may be redeemed
by CMTA, in 13 months or less. These obligations may originally have been issued
with maturities in excess of 13 months. CMTA may currently invest only in
corporate bonds or notes of issuers having outstanding short-term securities
rated in the top rating category by Standard & Poor's Corporation or by Moody's
Investors Service, Inc. See "Description of Ratings for Debt Securities" for a
description of high-quality ratings by Standard & Poor's Corporation and Moody's
Investors Service, Inc.

THE TAX-EXEMPT MONEY FUND OF AMERICA
- ------------------------------------

MUNICIPAL BONDS - Municipal bonds are debt obligations generally issued to
obtain funds for various public purposes, including the construction of public
facilities. Opinions relating to the validity of municipal bonds, their
exclusion from gross income for federal income tax purposes and, where
applicable, state and local income tax are rendered by bond counsel to the
issuing authorities at the time of issuance.

Money Market Funds -- Page 4

<PAGE>

The two principal classifications of municipal bonds are general obligation
bonds and limited obligation or revenue bonds. General obligation bonds are
secured by the issuer's pledge of its full faith and credit including, if
available, its taxing power for the payment of principal and interest. Issuers
of general obligation bonds include states, counties, cities, towns and various
regional or special districts. The proceeds of these obligations are used to
fund a wide range of public facilities such as the construction or improvement
of schools, highways and roads, water and sewer systems and facilities for a
variety of other public purposes. Lease revenue bonds or certificates of
participation in leases are payable from annual lease rental payments from a
state or locality. Annual rental payments are payable to the extent such rental
payments are appropriated annually.

Typically, the only security for a limited obligation or revenue bond is the net
revenue derived from a particular facility or class of facilities financed
thereby or, in some cases, from the proceeds of a special tax or other special
revenues. Revenue bonds have been issued to fund a wide variety of
revenue-producing public capital projects including: electric, gas, water and
sewer systems; highways, bridges and tunnels; port and airport facilities;
colleges and universities; hospitals; and convention, recreational and housing
facilities. Although the security behind these bonds varies widely, many provide
additional security in the form of a debt service reserve fund which may also be
used to make principal and interest payments on the issuer's obligations. In
addition, some revenue obligations (as well as general obligations) are insured
by a bond insurance company or backed by a letter of credit issued by a banking
institution.

Revenue bonds also include, for example, pollution control, health care and
housing bonds, which, although nominally issued by municipal authorities, are
generally not secured by the taxing power of the municipality but by the
revenues of the authority derived from payments by the private entity which owns
or operates the facility financed with the proceeds of the bonds. Obligations of
housing finance authorities have a wide range of security features including
reserve funds and insured or subsidized mortgages, as well as the net revenues
from housing or other public projects. Most of these bonds do not generally
constitute the pledge of the credit of the issuer of such bonds. The credit
quality of such revenue bonds is usually directly related to the credit standing
of the user of the facility being financed or of an institution which provides a
guarantee, letter of credit, or other credit enhancement for the bond issue.

TEMPORARY TAXABLE INVESTMENTS -- A portion of CTEX's assets, which will normally
be less than 20%, may be invested in high-quality taxable short-term securities.
Such temporary investments may include: (1) obligations of the U.S. Treasury;
(2) obligations of agencies and instrumentalities of the U.S. Government; and
(3) money market instruments, such as certificates of deposit issued by domestic
banks, corporate commercial paper, and bankers' acceptances. These investments
may be made when deemed advisable for temporary defensive purposes or when the
Investment Adviser believes there is an unusual disparity between the after-tax
income available on taxable investments and the income available on tax-exempt
securities.

THE TAX-EXEMPT MONEY FUND OF AMERICA AND THE U.S. TREASURY MONEY FUND OF AMERICA
- --------------------------------------------------------------------------------

LOANS OF PORTFOLIO SECURITIES -- Each fund is authorized to lend portfolio
securities to selected securities dealers or other institutional investors whose
financial condition is monitored by the Investment Adviser. The borrower must
maintain with the fund's custodian collateral consisting of cash, cash
equivalents or U.S. Government securities equal to at least 100% of the value of
the borrowed securities, plus any accrued interest. The Investment Adviser will
monitor the adequacy of the collateral on a daily basis. Each fund may at any
time call a loan of its portfolio

Money Market Funds -- Page 5

<PAGE>

securities and obtain the return of the loaned securities. Each fund will
receive any interest paid on the loaned securities and a fee or a portion of the
interest earned on the collateral. The fund will limit its loans of portfolio
securities to an aggregate of 10% of the value of its total assets, measured at
the time any such loan is made.

REPURCHASE AGREEMENTS -- Although CTEX or CTRS have no current intention of
doing so during the next 12 months, each fund is authorized to enter into
repurchase agreements, subject to the standards applicable to CMTA's repurchase
agreement transactions as described above.

THE U.S. TREASURY MONEY FUND OF AMERICA
- ---------------------------------------

The fund may also engage in the following investment practices, although it
has no current intention to do so over the next twelve months:

The fund may also enter into reverse repurchase agreements and "roll"
transactions. A reverse repurchase agreement is the sale of a security by a fund
and its agreement to repurchase the security at a specified time and price. A
"roll" transaction is the sale of mortgage-backed or other securities together
with a commitment to purchase similar, but not identical securities at a later
date. The fund assumes the rights and risks of ownership, including the risk of
price and yield fluctuations as of the time of the agreement. The fund intends
to treat roll transactions as two separate transactions: one involving the
purchase of a security and a separate transaction involving the sale of a
security. Since the fund does not intend to enter into roll transactions for
financing purposes, it may treat these transactions as not falling within the
definition of "borrowing" set forth in Section 2(a)(23) of the Investment
Company Act of 1940. The fund will segregate liquid assets which will be marked
to market daily in an amount sufficient to meet its payment obligations under
"roll" transactions and reverse repurchase agreements with broker-dealers (no
collateral is required for reverse repurchase agreements with banks).

THE CASH MANAGEMENT TRUST OF AMERICA, THE U.S. TREASURY MONEY FUND OF AMERICA
- -----------------------------------------------------------------------------
AND THE TAX-EXEMPT MONEY FUND OF AMERICA
- ----------------------------------------

MONEY MARKET INSTRUMENTS - The funds invest in various high-quality money market
instruments that mature, or may be redeemed or resold, in 13 months or less (25
months or less in the case of U.S. Government securities). For CMTA they
include: (1) commercial paper (notes issued by corporations or governmental
bodies), (2) commercial bank obligations such as certificates of deposit, bank
notes, and bankers' acceptances (time drafts on a commercial bank where the bank
accepts an irrevocable obligation to pay at maturity), (3) savings association
and savings bank obligations, (4) securities of the U.S. Government, its
agencies or instrumentalities, and (5) corporate bonds and notes. CMTA may
invest in securities issued by non-U.S. entities or in securities with credit
and liquidity support features provided by non-U.S. entities. Since these
securities are issued by entities that may have substantial operations outside
the U.S. they may involve additional risks and considerations. These securities
may be affected by unfavorable political, economic, or governmental developments
that could affect the repayment of principal or payment of interest. Securities
of U.S. issuers with substantial operations outside the U.S. may also be subject
to similar risks.

CTRS may invest in instruments that include U.S. Treasury bills, notes, and
bonds. CTEX invests in money market instruments that are issued by states,
territories, or possessions of the United States and the District of Columbia
and their political subdivisions, agencies and instrumentalities
("municipalities") to obtain funds for various public purposes. CTEX may
purchase various types of municipal securities including tax, bond, revenue, and
grant anticipation notes, construction loan notes, municipal commercial paper,
general obligation bonds, revenue bonds and industrial development bonds. In
addition, CTEX may invest in municipal securities that are supported by credit
and liquidity enhancements, which include letters of credit from domestic and
non- U.S. banks and other financial institutions. Changes in the credit quality
of these institutions could cause the fund to experience a loss and may affect
its share price. To the extent that the credit quality of these institutions is
downgraded, investments in such securities could increase the level of
illiquidity of the fund's portfolio for the remaining maturity of the
instruments.

VARIABLE AND FLOATING RATE OBLIGATIONS - The interest rates payable on certain
securities in which the fund may invest may not be fixed but may fluctuate based
upon changes in market rates. Variable and floating rate obligations bear coupon
rates that are adjusted at designated intervals, based on the then current
market rates of interest. Variable and
floating rate obligations permit the fund to "lock in" the current interest rate
for only the period until the next scheduled rate adjustment, but the rate
adjustment feature tends to limit the extent to which the market value of the
obligation will fluctuate.

"PUT" SECURITIES - CMTA and CTEX may purchase securities that provide for the
right to resell them to the issuer, a bank, or a broker-dealer typically at the
par value plus accrued interest

Money Market Funds -- Page 6

<PAGE>

within a specified period of time prior to maturity. This right is commonly
known as a "put" or a "demand feature." The funds may pay a higher price for
such securities than would otherwise be paid for the same security without such
a right. The funds will enter into these transactions only with issuers, banks,
or broker-dealers that are determined by Capital Research and Management Company
to present minimal credit risks. If an issuer, bank, or broker-dealer should
default on its obligation to repurchase, the funds might be unable to recover
all or a portion of any loss sustained. There is no specific limit on the extent
to which the funds may invest in such securities.

MATURITY -- Each fund determines net asset value using the penny-rounding
method, according to rules of the Securities and Exchange Commission, which
permits it to maintain a constant net asset value of $1.00 per share under
normal conditions. In accordance with rule 2a-7, each fund is required to
maintain a dollar-weighted average portfolio maturity of 90 days or less and
purchase only instruments having remaining maturities of 13 months or less (25
months or less in the case of U.S. Government securities) determined in
accordance with procedures established by the Board of Trustees to present
minimal credit risks. For this purpose, certain variable and floating rate
obligations and "put" securities which may otherwise have stated maturities in
excess of 13 months (25 months in the case of U.S. Government securities) will
be deemed to have remaining maturities equal to the period remaining until the
next readjustment of the interest rate or until the fund is entitled to
repayment or repurchase of the security. CMTA, CTRS and CTEX currently intend to
maintain dollar-weighted average portfolio maturities of approximately 35 days
or less, 90 days or less and 60 days or less, respectively.

FORWARD COMMITMENTS - The funds may enter into commitments to purchase or sell
securities at a future date. When the funds agree to purchase such securities
they assume the risk of any decline in value of the security beginning on the
date of the agreement. When the funds agree to sell such securities they do not
participate in further gains or losses with respect to the securities beginning
on the date of the agreement. If the other party to such a transaction fails to
deliver or pay for the securities, the funds could miss a favorable price or
yield opportunity, or could experience a loss.

As the funds' aggregate commitments under these transactions increase, the
opportunity for leverage similarly increases. The funds will not use these
transactions for the purpose of leveraging and will segregate liquid assets
which will be marked to market daily in an amount sufficient to meet its payment
obligations in these transactions. Although these transactions will not be
entered into for leveraging purposes, to the extent the funds' aggregate
commitments under these transactions exceed its segregated assets, the fund
temporarily could be in a leveraged position (because they may have an amount
greater than their net assets subject to market risk). Should market values of
the funds' portfolio securities decline while the funds are in a leveraged
position, greater depreciation of its net assets would likely occur than were it
not in such a position. The funds will not borrow money to settle these
transactions and therefore, will liquidate other portfolio securities in advance
of settlement if necessary to generate additional cash to meet its obligations
thereunder.

FUNDAMENTAL POLICIES AND INVESTMENT RESTRICTIONS

FUNDAMENTAL POLICIES - Each fund has adopted the following fundamental policies
and investment restrictions which may not be changed without approval by holders
of a majority of its outstanding shares. Such majority is defined in the
Investment Company Act of 1940 ("1940 Act") as the vote of the lesser of (i) 67%
or more of the outstanding voting securities present at a

Money Market Funds -- Page 7

<PAGE>

meeting, if the holders of more than 50% of the outstanding voting securities
are present in person or by proxy, or (ii) more than 50% of the outstanding
voting securities. All percentage limitations are considered at the time
securities are purchased and are based on the fund's net assets unless otherwise
indicated. None of the following investment restrictions involving a maximum
percentage of assets will be considered violated unless the excess occurs
immediately after, and is caused by, an acquisition by the fund.

CMTA may not:
---

1. Invest its assets in issues other than those of the U.S. Government, its
agencies or instrumentalities, obligations of commercial banks and savings
institutions with total assets in excess of $1 billion, commercial paper, and
investment-grade corporate obligations--all maturing in one year or less. CMTA
may, however, invest in obligations issued by commercial banks and savings
institutions with assets of less than $1 billion if the principal amounts of
such obligations are fully insured by the U. S. Government;

2. Invest more than 5% of its total assets in the securities of any one
issuer, except the U.S. Government, its agencies and instrumentalities. With
respect to 25% of total assets, commercial banks are excluded from this 5%
limitation;

3. Invest more than 25% of total assets in the securities of issuers in the
same industry. Electric, natural gas distribution, natural gas pipeline,
combined electric and natural gas, and telephone utilities are considered
separate industries for purposes of this restriction. Obligations of the U.S.
Government, its agencies and instrumentalities are not subject to this 25%
limitation on industry concentration. In addition, CMTA may, if deemed
advisable, invest more than 25% of its assets in the obligations of commercial
banks;

4. Enter into any repurchase agreement if, as a result, more than 10% of total
assets would be subject to repurchase agreements maturing in more than seven
days;

5. Make loans to others except for the purchase of debt securities or entering
into repurchase agreements as listed above;

6. Borrow money, except from banks for temporary purposes and then in an
amount not in excess of 33-1/3% of total assets. This borrowing power is
reserved to facilitate the orderly sale of portfolio securities to accommodate
unusually heavy redemption requests, if they should occur; it is not included
for investment purposes;

7. Pledge more than 15% of its assets and then only to secure temporary
borrowings from banks;

8. Sell securities short;

9. Invest in puts, calls, straddles, spreads or any combination thereof;

10. Purchase or sell securities of other investment companies (except in
connection with a merger, consolidation, acquisition or reorganization), real
estate, or commodities;

11. Engage in the underwriting of securities issued by others.

Money Market Funds -- Page 8

<PAGE>

Notwithstanding Investment Restriction #9, the fund may invest in securities
with put and call features. Notwithstanding Investment Restriction #10, the fund
may invest in securities of other investment companies if deemed advisable by
its officers in connection with the administration of a deferred compensation
plan adopted by Trustees pursuant to an exemptive order granted by the
Securities and Exchange Commission.

For purposes of Investment Restriction #1, CMTA currently invests only in high
quality obligations in accordance with rule 2a-7 under the 1940 Act, as
described in the prospectus. (CMTA will notify shareholders 180 days in advance
in the event it no longer is required to adhere to rule 2a-7 and it intends to
stop relying on the rule.) For purposes of Investment Restriction #2, the fund
may invest more than 5% of its total assets in the securities of any one issuer
only to the extent allowed under rule 2a-7 of the Investment Company Act of
1940. For purposes of Investment Restriction #3, CMTA will not invest 25% or
more of total assets in the securities of issuers in the same industry.
Additionally, for purposes of Investment Restriction #3, the Investment Adviser
currently interprets the term "commercial banks" to mean domestic branches of
U.S. banks. These policies are non-fundamental and may be changed by the Board
of Trustees without shareholder approval.

CTRS may not:
---

1. Purchase any security (other than securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities), if immediately after and
as a result of such investment (a) with respect to 75% of CTRS' total assets,
more than 5% of CTRS' total assets would be invested in securities of the
issuer, or (b) CTRS would hold more than 10% of any class of securities or of
the total securities of the issuer (for this purpose all indebtedness of an
issuer shall be deemed a single class).

2. Buy or sell real estate (including real estate limited partnerships) in the
ordinary course of its business; however, CTRS may invest in securities secured
by real estate or interests therein;

3. Acquire securities for which there is no readily available market or enter
into repurchase agreements or purchase time deposits maturing in more than seven
days, if, immediately after and as a result, the value of such securities would
exceed, in the aggregate, 10% of CTRS' total assets;

4. Make loans to others, except by the purchase of debt securities, entering
into repurchase agreements or making loans of portfolio securities;

5. Sell securities short;

6. Purchase securities on margin, except such short-term credits as may be
necessary for the clearance of purchases or sales of securities;

7. Borrow money, except from banks for temporary or emergency purposes, not in
excess of 5% of the value of CTRS' total assets, excluding the amount borrowed.
This borrowing provision is intended to facilitate the orderly sale of portfolio
securities to accommodate unusually heavy redemption requests, if they should
occur; it is not intended for investment purposes. In the event that the asset
coverage for CTRS' borrowings falls below 300%, CTRS will reduce within three
days (excluding Sundays and holidays), the amount of its borrowings in order to
provide for 300% asset coverage, and except that CTRS may enter into reverse
repurchase agreements,

Money Market Funds -- Page 9

<PAGE>

provided that reverse repurchase agreements and any other transactions
constituting borrowing by CTRS may not exceed one-third of CTRS' total assets;

8. Mortgage, pledge, or hypothecate its assets, except in an amount up to 5%
of the value of its total assets, but only to secure borrowings for temporary or
emergency purposes;

9. Underwrite any issue of securities, except to the extent that the purchase
of securities directly from the issuer in accordance with CTRS' investment
objective, policies and restrictions, and later resale, may be deemed to be an
underwriting;

10. Knowingly purchase securities of other managed investment companies, except
in connection with a merger, consolidation, acquisition, or reorganization;

11. Buy or sell commodities or commodity contracts (including futures
contracts) or oil, gas or other mineral exploration or development programs;

12. Write, purchase or sell puts, calls, straddles, spreads or any combination
thereof, except that this shall not prevent the purchase of securities which
have "put" or "stand-by commitment" features;

13. Purchase or retain the securities of any issuer, if, to the knowledge of
CTRS, those individual officers and Board members of CTRS, its Investment
Adviser, or principal underwriter, each owning beneficially more than 1/2 of 1%
of the securities of such issuer, together own more than 5% of the securities of
such issuer;

14. Invest more than 5% of the value of CTRS' total assets in securities of any
issuer with a record of less than three years continuous operation, including
predecessors;

15. Invest 25% or more of total assets in the securities of issuers in the same
industry. Electric, natural gas distribution, natural gas pipeline, combined
electric and natural gas, and telephone utilities are considered separate
industries for purposes of this restriction. Obligations of the U.S. Government,
its agencies and instrumentalities, are not subject to this 25% or more
limitation on industry concentration. In addition, CTRS may, if deemed
advisable, invest 25% or more of its assets in the obligations of commercial
banks.

Notwithstanding Investment Restriction #10, the fund may invest in securities of
other investment companies if deemed advisable by its officers in connection
with the administration of a deferred compensation plan adopted by Trustees
pursuant to an exemptive order granted by the Securities and Exchange
Commission.

For purposes of Investment Restriction #11, the term "oil, gas or other mineral
exploration or development programs" includes oil, gas or other mineral
exploration or development leases. For purposes of Investment Restriction #15,
the Investment Adviser currently interprets the term "commercial banks" to mean
domestic branches of U.S. banks. Finally, CTRS will not invest more than 5% of
its net assets valued at market at the time of purchase, in warrants including
not more than 2% of such net assets in warrants that are not listed on either
the New York Stock Exchange or the American Stock Exchange; however, warrants
acquired in units or attached to securities may be deemed to be without value
for the purpose of this restriction. These policies are not deemed fundamental
and may be changed by the Board of Trustees without shareholder approval.

Money Market Funds -- Page 10

<PAGE>

CTEX may not:
---

1. Purchase any security (other than securities issued or guaranteed by the
U.S. government or its agencies or instrumentalities), if immediately after and
as a result of such investment (a) with respect to 75% of CTEX's total assets,
more than 5% of CTEX's total assets would be invested in securities of the
issuer, or (b) CTEX would hold more than 10% of any class of securities or of
the total securities of the issuer (for this purpose all indebtedness of an
issuer shall be deemed a single class).

2. Enter into any repurchase agreement if, as a result, more than 10% of the
value of CTEX's total assets would be subject to repurchase agreements maturing
in more than seven days;

3. Buy or sell real estate (including real estate limited partnerships) in the
ordinary course of its business; however, CTEX may invest in securities secured
by real estate or interests therein;

4. Acquire securities subject to restrictions on disposition or securities for
which there is no readily available market (including securities of foreign
issuers not listed on any recognized foreign or domestic exchange), or enter
into repurchase agreements or purchase time deposits maturing in more than seven
days, if, immediately after and as a result, the value of such securities would
exceed, in the aggregate, 10% of CTEX's total assets;

5. Make loans to others, except for the purchase of debt securities, entering
into repurchase agreements or making loans of portfolio securities;

6. Sell securities short, except to the extent that CTEX contemporaneously
owns or has the right to acquire at no additional cost securities identical to
those sold short;

7. Purchase securities on margin, except such short-term credits as may be
necessary for the clearance of purchases or sales of securities;

8. Borrow money, except from banks for temporary or emergency purposes, not in
excess of 5% of the value of CTEX's total assets, excluding the amount borrowed.
This borrowing provision is intended to facilitate the orderly sale of portfolio
securities to accommodate unusually heavy redemption requests, if they should
occur; it is not intended for investment purposes. In the event that the asset
coverage for CTEX's borrowings falls below 300%, CTEX will reduce within three
days (excluding Sundays and holidays), the amount of its borrowings in order to
provide for 300% asset coverage;

9. Mortgage, pledge, or hypothecate its assets, except in an amount up to 5%
of the value of its total assets, but only to secure borrowings for temporary or
emergency purposes;

10. Underwrite any issue of securities, except to the extent that the purchase
of municipal securities directly from the issuer in accordance with CTEX's
investment objective, policies and restrictions, and later resale, may be deemed
to be an underwriting;

11. Invest in companies for the purpose of exercising control or management;

12. Knowingly purchase securities of other managed investment companies, except
in connection with a merger, consolidation, acquisition, or reorganization;

Money Market Funds -- Page 11

<PAGE>

13. Buy or sell commodities or commodity contracts or oil, gas or other mineral
exploration or development programs;

14. Write, purchase or sell puts, calls, straddles, spreads or any combination
thereof, except that this shall not prevent the purchase of municipal securities
which have "put" or "stand-by commitment" features;

15. Purchase or retain the securities of any issuer, if, to the knowledge of
CTEX, those individual officers and Board members of CTEX, its Investment
Adviser, or principal underwriter, each owning beneficially more than 1/2 of 1%
of the securities of such issuer, together own more than 5% of the securities of
such issuer;

16. Invest more than 5% of the value of CTEX's total assets in securities of
any issuer with a record of less than three years continuous operation,
including predecessors;

17. Invest 25% or more of the value of its total assets in the securities of
issuers conducting their principal business activities in the same industry.

For purposes of Investment Restriction #2, the fund will not enter into any
repurchase agreement if, as a result, more than 10% of net assets would be
subject to repurchase agreements maturing in more than seven days.

For the purpose of CTEX's investment restrictions, the identification of the
"issuer" of municipal securities that are not general obligation securities is
made by the Investment Adviser on the basis of the characteristics of the
securities as described, the most significant of which is the ultimate source of
funds for the payment of principal and interest on such securities. For purposes
of investment restriction #13 the term "commodities contract" includes futures
contracts.

Notwithstanding Investment Restriction #12, the fund may invest in securities of
other investment companies if deemed advisable by its officers in connection
with the administration of a deferred compensation plan adopted by Trustees
pursuant to an exemptive order granted by the Securities and Exchange
Commission.

For purposes of Investment Restriction #16, the fund may invest more than 5% of
its total assets in the securities of any one issuer only to the extent allowed
under rule a-7 of the Investment Company Act of 1940.

The following policies of CTEX are not deemed fundamental, and thus may be
changed by the Board of Trustees without shareholder approval: CTEX may not
invest 25% or more of its assets in municipal securities the issuers of which
are located in the same state, unless such securities are guaranteed by the U.S.
Government, or more than 25% of its total assets in securities the interest on
which is paid from revenues of similar type projects. CTEX may invest no more
than an aggregate of 20% of its total assets in industrial development
securities. There could be economic, business or political developments which
might affect all municipal securities of a similar category or type or issued by
issuers within any particular geographical area or jurisdiction. Finally, CTEX
will not invest more than 5% of its net assets valued at market at the time of
purchase, in warrants including not more than 2% of such net assets in warrants
that are not listed on either the New York Stock Exchange or the American Stock
Exchange; however,

Money Market Funds -- Page 12

<PAGE>

warrants acquired in units or attached to securities may be deemed to be without
value for the purpose of this restriction.

FUND ORGANIZATION AND VOTING RIGHTS

Each fund, an open-end, diversified management investment company, was organized
as a Massachusetts business trust (Cash Management Trust on March 1, 1976,
Tax-Exempt Money Fund on December 5, 1988 and U.S. Treasury Money Fund on
December 19, 1990).

All fund operations are supervised by each fund's board of trustees which meets
periodically and performs duties required by applicable state and federal laws.
Members of the board who are not employed by Capital Research and Management
Company or its affiliates are paid certain fees for services rendered to the
fund as described in "Trustees and Trustee Compensation" below. They may elect
to defer all or a portion of these fees through a deferred compensation plan in
effect for the fund.

The funds do not hold annual meetings of shareholders. However, significant
matters which require shareholder approval, such as certain elections of board
members or a change in a fundamental investment policy, will be presented to
shareholders at a meeting called for such purpose. Shareholders have one vote
per share owned. At the request of the holders of at least 10% of the shares,
each fund will hold a meeting at which any member of the board could be removed
by a majority vote.

Money Market Funds -- Page 13

<PAGE>

FUND TRUSTEES AND OFFICERS

Trustees and Trustee Compensation

<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
(INCLUDING VOLUNTARILY
DEFERRED
COMPENSATION/1/)
FROM THE FUND
POSITION DURING FISCAL YEAR
WITH PRINCIPAL OCCUPATION(S) DURING ENDED
NAME, ADDRESS AND AGE REGISTRANT PAST 5 YEARS SEPTEMBER 30, 1999
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Richard G. Capen, Jr. Trustee Corporate Director and author; none/3/ CMTA
6077 San Elijo, Box 2494 former United States Ambassador to $1,400 CTEX
Rancho Santa Fe, CA 92067 Spain; former Vice Chairman of the none/3/ CTRS
Age: 65 Board, Knight-Ridder, Inc., former
Chairman and Publisher, The Miami
Herald
- ------------------------------------------------------------------------------------------------------------
H. Frederick Christie Trustee Private Investor. Former President $6,250 CMTA
P.O. Box 144 and Chief Executive Officer, The $2,650 CTEX
Palos Verdes Estates, CA Mission Group (non-utility holding $3,150 CTRS
90274 company, subsidiary of Southern
Age: 66 California Edison Company)
- ------------------------------------------------------------------------------------------------------------
+Don R. Conlan Trustee President (retired), The Capital none/4/
1630 Milan Avenue Group Companies, Inc.
South Pasadena, CA 91030
Age: 63
- ------------------------------------------------------------------------------------------------------------
Diane C. Creel Trustee CEO and President, The Earth $5,200 CMTA
100 W. Broadway Technology Corporation $1,800 CTEX
Suite 5000 (international consulting $2,300 CTRS
Long Beach, CA 90802 engineering)
Age: 51
- ------------------------------------------------------------------------------------------------------------
Martin Fenton Trustee Chairman, Senior Resource Group LLC $5,600/4/ CMTA
4660 La Jolla Village (development and management of $2,000/4/ CTEX
Drive senior living communities) $2,500/4/ CTRS
Suite 725
San Diego, CA 92122
Age: 64
- ------------------------------------------------------------------------------------------------------------
Leonard R. Fuller Trustee President, Fuller Consulting $6,000 CMTA
4337 Marina City Drive (financial management consulting $2400 CTEX
Suite 841 ETN firm) $ 2,900 CTRS
Marina del Rey, CA 90292
Age: 53
- ------------------------------------------------------------------------------------------------------------
+*Abner D. Goldstine President, Senior Vice President and Director, none/5/
Age: 69 PEO Capital Research and Management
and Trustee Company
- ------------------------------------------------------------------------------------------------------------
+**Paul G. Haaga, Jr. Chairman of Executive Vice President and none/5/
Age: 50 the Board Director, Capital Research and
Management Company
- ------------------------------------------------------------------------------------------------------------
Herbert Hoover III Trustee Private Investor $5,800/6/ CMTA
1520 Circle Drive $2,200/6/ CTEX
San Marino, CA 91108 $2,700/6/ CTRS
Age: 72
- ------------------------------------------------------------------------------------------------------------
Richard G. Newman Trustee Chairman, President and CEO, AECOM $5,600/4/ CMTA
3250 Wilshire Boulevard Technology Corporation $2,200/4/ CTEX
Los Angeles, CA 90010-1599 (architectural engineering) $2,700/4/ CTRS
Age: 65
- ------------------------------------------------------------------------------------------------------------
Frank M. Sanchez Trustee President, The Sanchez Family none/3/ CMTA
5234 Via San Delarro, #1 Corporation dba McDonald's $1,200 CTEX/4/
Los Angeles, CA 90022 Restaurants (McDonald's licensee) none/3/ CTRS
Age: 55
- ------------------------------------------------------------------------------------------------------------
<CAPTION>
TOTAL COMPENSATION
(INCLUDING VOLUNTARILY
DEFERRED
COMPENSATION/1/) FROM TOTAL NUMBER
ALL FUNDS MANAGED BY OF FUND
CAPITAL RESEARCH AND BOARDS
MANAGEMENT COMPANY ON WHICH
OR ITS AFFILIATES/2/ FOR THE TRUSTEE
NAME, ADDRESS AND AGE YEAR ENDED SEPTEMBER 30, 1999 SERVES/2/
- ---------------------------------------------------------------------------
<S> <C> <C>
Richard G. Capen, Jr. $ 45,250 14
6077 San Elijo, Box 2494
Rancho Santa Fe, CA 92067
Age: 65
- ---------------------------------------------------------------------------
H. Frederick Christie $211,600 19
P.O. Box 144
Palos Verdes Estates, CA
90274
Age: 66
- ---------------------------------------------------------------------------
+Don R. Conlan none/4/ 12
1630 Milan Avenue
South Pasadena, CA 91030
Age: 63
- ---------------------------------------------------------------------------
Diane C. Creel $ 48,000 12
100 W. Broadway
Suite 5000
Long Beach, CA 90802
Age: 51
- ---------------------------------------------------------------------------
Martin Fenton $132,600 15
4660 La Jolla Village
Drive
Suite 725
San Diego, CA 92122
Age: 64
- ---------------------------------------------------------------------------
Leonard R. Fuller $ 63,267 13
4337 Marina City Drive
Suite 841 ETN
Marina del Rey, CA 90292
Age: 53
- ---------------------------------------------------------------------------
+*Abner D. Goldstine none/5/ 12
Age: 69

- ---------------------------------------------------------------------------
+**Paul G. Haaga, Jr. none/5/ 14
Age: 50

- ---------------------------------------------------------------------------
Herbert Hoover III $ 61,083 1/6/
1520 Circle Drive
San Marino, CA 91108
Age: 72
- ---------------------------------------------------------------------------
Richard G. Newman $107,100 13
3250 Wilshire Boulevard
Los Angeles, CA 90010-1599
Age: 65
- ---------------------------------------------------------------------------
Frank M. Sanchez $ 5,050 12
5234 Via San Delarro, #1
Los Angeles, CA 90022
Age: 55
- ---------------------------------------------------------------------------
</TABLE>

Money Market Funds -- Page 14

<PAGE>

Money Market Funds -- Page 15

<PAGE>

+ "Interested persons" within the meaning of the 1940 Act on the basis of their
affiliation with the fund's Investment Adviser, Capital Research and
Management Company or the parent company of the Investment Adviser, The
Capital Group Companies, Inc.
++ May be deemed an "interested person" of the fund due to membership on the
board of directors of the parent company of a registered broker-dealer.
* Address is 11100 Santa Monica Boulevard, Los Angeles, CA 90025
** Address is 333 South Hope Street, Los Angeles, CA 90071
1 Amounts may be deferred by eligible Trustees under a non-qualified deferred
compensation plan adopted by the fund in 1993. Deferred amounts accumulate at
an earnings rate determined by the total return of one or more funds in The
American Funds Group as designated by the Trustees.

2 Capital Research and Management Company manages The American Funds Group
consisting of 29 funds: AMCAP Fund, Inc., American Balanced Fund, Inc.,
American High-Income Municipal Bond Fund, Inc., American High-Income Trust,
American Mutual Fund, Inc., The Bond Fund of America, Inc., The Cash
Management Trust of America, Capital Income Builder, Inc., Capital World
Growth and Income Fund, Inc., Capital World Bond Fund, Inc., EuroPacific
Growth Fund, Fundamental Investors, Inc., The Growth Fund of America, Inc.,
The Income Fund of America, Inc., Intermediate Bond Fund of America, The
Investment Company of America, Limited Term Tax-Exempt Bond Fund of America,
The New Economy Fund, New Perspective Fund, Inc., New World Fund, Inc.,
SMALLCAP World Fund, Inc., The Tax-Exempt Bond Fund of America, Inc., The
Tax-Exempt Fund of California, The Tax-Exempt Fund of Maryland, The Tax-Exempt
Fund of Virginia, The Tax-Exempt Money Fund of America, The U. S. Treasury
Money Fund of America, U.S. Government Securities Fund and Washington Mutual
Investors Fund, Inc. Capital Research and Management Company also manages
American Variable Insurance Series and Anchor Pathway Fund, which serve as the
underlying investment vehicle for certain variable insurance contracts; and
Endowments, whose shareholders are limited to (i) any entity exempt from
taxation under Section 501(c)(3) of the Internal Revenue Code of 1986, as
amended ("501(c)(3) organization"); (ii) any trust, the present or future
beneficiary of which is a 501(c)(3) organization, and (iii) any other entity
formed for the primary purpose of benefiting a 501(c)(3) organization. An
affiliate of Capital Research and Management Company, Capital International,
Inc., manages Emerging Markets Growth Fund, Inc.

3 Richard G. Capen, Jr. and Frank M. Sanchez did not serve as Trustees of
CMTA or CTRS during each fund's fiscal year ended September 30, 1999 and,
therefore, received no compensation. Both were elected by shareholders as
Trustees of CMTA and CTRS on November 19, 1999.

4 Since the deferred compensation plan's adoption, the total amount of deferred
compensation accrued by the fund (plus earnings thereon) as of fiscal year
ended September 30, 1999 for participating Trustees is as follows: Richard G.
Capen ($1,418 - CTEX), Martin Fenton ($4,566 - CMTA; $434 - CTEX and $1,014 -
CTRS), Richard G. Newman ($21,566 - CMTA; $9,503 - CTEX and $10,658 - CTRS)
and Frank M. Sanchez ($204 - CTEX). Amounts deferred and accumulated earnings
thereon are not funded and are general unsecured liabilities of the fund until
paid to the Trustee. Amounts deferred and accumulated earnings thereon are not
funded and are general unsecured liabilities of the fund until paid to the
Trustees.

5 Don R. Conlan, Abner D. Goldstine, and Paul G. Haaga, Jr. are affiliated with
the Investment Adviser and, accordingly, receive no compensation from the
fund.

6 Herbert Hoover III served as a Trustee of CMTA, CTRS and CTEX through
each fund's fiscal year, but did not stand for re-election as a Trustee of
CMTA and CTRS on November 19, 1999 and retires as a Trustee of CTEX on
December 31, 1999.

Money Market Funds -- Page 16

<PAGE>

OFFICERS

<TABLE>
<CAPTION>
POSITION(S) PRINCIPAL OCCUPATION(S) DURING
NAME AND ADDRESS AGE WITH REGISTRANT PAST 5 YEARS
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Teresa S. Cook 47 Vice President Senior Vice President -
333 South Hope Street (CMTA and CTRS Investment Management Group,
Los Angeles, CA 90071 only) Capital Research and Management
Company
- -------------------------------------------------------------------------------
Michael J. Downer 44 Vice President Senior Vice President - Fund
333 South Hope Street Business Management Group,
Los Angeles, CA 90071 Capital Research and Management
Company
- -------------------------------------------------------------------------------
Neil L. Langberg 46 Senior Vice Vice President - Investment
11100 Santa Monica President (CTEX) Management Group, Capital
Blvd. Research and Management Company
Los Angeles, CA 90025
- -------------------------------------------------------------------------------
Karen F. Hall 34 Assistant Assistant Vice President -
333 South Hope Street Vice President Investment Management Group,
Los Angeles, CA 90071 (CMTA and CTRS Capital Research and Management
only) Company
- -------------------------------------------------------------------------------
Julie F. Williams 51 Secretary Vice President - Fund Business
333 South Hope Street Management Group, Capital
Los Angeles, CA 90071 Research and Management Company
- -------------------------------------------------------------------------------
Anthony W. Hynes, Jr. 37 Treasurer Vice President - Fund Business
135 South State Management Group, Capital
College Blvd. Research and Management Company
Brea, CA 92821
- -------------------------------------------------------------------------------
Kimberly S. Verdick 35 Assistant Assistant Vice President - Fund
333 South Hope Street Secretary Business Management Group,
Los Angeles, CA 90071 Capital Research and Management
Company
- -------------------------------------------------------------------------------
Todd L. Miller 41 Assistant Assistant Vice President - Fund
135 South State Treasurer Business Management Group,
College Blvd. Capital Research and Management
Brea, CA 92821 Company
- -------------------------------------------------------------------------------
</TABLE>

# Positions within the organizations listed may have changed during this period.

All of the officers listed are officers, and/or directors/trustees of one or
more of the other funds for which Capital Research and Management Company serves
as Investment Adviser.

No compensation is paid by a fund to any officer or Trustee who is a director,
officer or employee of the Investment Adviser or affiliated companies. The funds
pay annual fees to Trustees who are not affiliated with the Investment Adviser
as follows: CMTA - $4,000; CTEX - $400 and CTRS - $900. In addition, each
fund pays $200 for each Board of Trustees meeting attended, plus $200 for each
meeting attended as a member of a committee of the Board of Trustees. No pension
or retirement benefits are accrued as part of fund expenses. The Trustees may
elect, on a voluntary basis, to defer all or a portion of their fees through a
deferred compensation plan in effect for the fund. The fund also reimburses
certain expenses of the Trustees who are not affiliated with the Investment
Adviser. As of November 1, 1999 the officers and Directors of the fund and their

Money Market Funds -- Page 17

<PAGE>

families, as a group, owned beneficially or of record less than 1% of the
outstanding shares of the fund.

MANAGEMENT

INVESTMENT ADVISER - The Investment Adviser, founded in 1931, maintains research
facilities in the U.S. and abroad (Los Angeles, San Francisco, New York,
Washington, D.C., London, Geneva, Hong Kong, Singapore and Tokyo), with a staff
of professionals, many of whom have a number of years of investment experience.
The Investment Adviser is located at 333 South Hope Street, Los Angeles, CA
90071, and at 135 South State College Boulevard, Brea, CA 92821. The Investment
Adviser's research professionals travel several million miles a year, making
more than 5,000 research visits in more than 50 countries around the world. The
Investment Adviser believes that it is able to attract and retain quality
personnel. The Investment Adviser is a wholly owned subsidiary of The Capital
Group Companies, Inc.

An affiliate of the Investment Adviser compiles indices for major stock markets
around the world and compiles and edits the Morgan Stanley Capital International
Perspective, providing financial and market information about more than 2,400
companies around the world.

The Investment Adviser is responsible for managing more than $200 billion of
stocks, bonds and money market instruments and serves over eight million
investors of all types throughout the world. These investors include privately
owned businesses and large corporations as well as schools, colleges,
foundations and other non-profit and tax-exempt organizations.

INVESTMENT ADVISORY AND SERVICE AGREEMENT - Each fund has an Investment Advisory
and Service Agreement (the "Agreement") with the Investment Adviser which
provides that the Investment Adviser shall determine which securities shall be
purchased or sold by each fund and provides certain services to each fund.

The CMTA Agreement will continue in effect until May 31, 2000, unless sooner
terminated. The CTEX Agreement will continue in effect until October 1, 2000,
unless sooner terminated, and the CTRS Agreement will continue in effect until
October 31, 2000, unless sooner terminated. Each Agreement may be renewed from
year to year thereafter, provided that any such renewal has been specifically
approved at least annually by (i) the Board of Trustees, or by the vote of a
majority (as defined in the 1940 Act) of the outstanding voting securities of
the fund, and (ii) the vote of a majority of Trustees who are not parties to the
Agreement or interested persons (as defined in the 1940 Act) of any such party,
cast in person at a meeting called for the purpose of voting on such approval.
The Agreement provides that the Investment Adviser has no liability to the fund
for its acts or omissions in the performance of its obligations to the fund not
involving willful misconduct, bad faith, gross negligence or reckless disregard
of its obligations under the Agreement. The Agreement also provides that either
party has the right to terminate it, without penalty, upon 60 days' written
notice to the other party and that the Agreement automatically terminates in the
event of its assignment (as defined in the 1940 Act).

The Investment Adviser, in addition to providing investment advisory services,
furnishes the services and pays the compensation and travel expenses of persons
to perform the executive, administrative, clerical and bookkeeping functions of
each fund, and provides suitable office space, necessary small office equipment
and utilities, general purpose accounting forms, supplies, and postage used at
the offices of the fund. Each fund pays all expenses not assumed by the
Investment Adviser, including, but not limited to, custodian, stock transfer and
dividend

Money Market Funds -- Page 18

<PAGE>

disbursing fees and expenses; costs of the designing, printing and mailing of
reports, prospectuses, proxy statements, and notices to its shareholders; taxes;
expenses of the issuance and redemption of shares of the fund (including stock
certificates, registration and qualification fees and expenses); expenses
pursuant to each fund's Plan of Distribution (described below); legal and
auditing expenses; compensation, fees, and expenses paid to directors
unaffiliated with the Investment Adviser; association dues; costs of stationery
and forms prepared exclusively for the fund; and costs of assembling and storing
shareholder account data.

Capital Research and Management Company manages the investment portfolios and
business affairs of the funds and receives an annual fee from each fund as
follows:

Cash Management Trust: 0.32% on the first $1 billion of average net
assets; plus 0.29% on average net assets between $1 billion and $2 billion;
plus 0.27% on average net assets in excess of $2 billion;

U.S. Treasury Money Fund: 0.30% on the first $800 million of average net
assets; plus 0.285% on average net assets in excess of $800 million;

Tax-Exempt Money Fund: 0.39% on the first $200 million of average net
assets; plus 0.37% on average net assets between $200 million and $600
million; plus 0.33% on the portion of average net assets between $600
million and $1.2 billion; plus 0.29% on average net assets in excess of
$1.2 billion.

The Investment Adviser has agreed to waive its fees by any amount necessary to
assure that such expenses do not exceed applicable expense limitations in any
state in which the funds' shares are being offered for sale.

CMTA The Agreement provides that the Investment Adviser will reimburse CMTA for
- ----
any expenses incurred by CMTA in any fiscal year, exclusive of interest, taxes,
brokerage costs and extraordinary items such as litigation and acquisitions, to
the extent such expenses exceed the lesser of 25% of gross income for the
preceding year or the sum of (a) 1-1/2% of the average daily net assets of the
preceding year up to and including $30 million, and (b) 1% of any excess of
average daily net assets of preceding year over $30 million. The Investment
Advisory fee is included as an expense of CMTA and is subject to the expense
limitation described in the preceding sentence.

CTEX The Investment Adviser has agreed that in the event the expenses of the
- ----
fund (with the exclusion of interest, taxes, brokerage costs, extraordinary
expenses such as litigation and acquisitions or other expenses excludable under
applicable state securities laws or regulations) for any fiscal year ending ona
date on which the Agreement is in effect, exceed the expense limitations, if
any, applicable to the fund pursuant to state securities laws or any regulations
thereunder, it will reduce its fee by the extent of such excess and, if required
pursuant to any such laws or any regulations thereunder, will reimburse the fund
in the amount of such excess.

CTRS The Investment Adviser has agreed to bear any CTRS expenses (with the
- ----
exception of interest, taxes, brokerage costs and extraordinary expenses such as
litigation and acquisitions) in excess of 0.75% of CTRS's average net assets per
annum, subject to reimbursement by CTRS during a period which will terminate at
the earlier of (i) such time as no reimbursement has been required for a period
of 12 consecutive months, provided no advances are outstanding, or (ii) February
1, 2001. Additionally, the Investment Adviser voluntarily agreed to waive its
fees to

Money Market Funds -- Page 19

<PAGE>

the extent necessary to ensure that fund expenses do not exceed 0.675% of the
average daily net assets. There can be no assurance that this voluntary fee
waiver will continue in the future. Each month, to the extent CTRS owes money
to the Investment Adviser pursuant to this provision of the Agreement and CTRS'
annualized expense ratio for the month is below 0.75%, CTRS will reimburse the
Investment Adviser until CTRS' annualized expense ratio equals 0.75% or the debt
is repaid, whichever comes first.

For the fiscal years ended September 30, 1999, 1998, and 1997, the Investment
Adviser received advisory fees from CMTA of $14,593,000, $11,113,000, and
$10,230,000, respectively. For the fiscal years ended September 30, 1999, 1998,
and 1997, the Investment Adviser received advisory fees from CTRS of $1,272,000,
$875,000, and $808,000, respectively. For the fiscal years ended September 30,
1999, 1998, and 1997, the Investment Adviser received advisory fees from CTEX of
$1,003,000, $800,000, and $648,000, respectively. Voluntary fee waivers for CTEX
amounted to $56,000 during the fiscal year ended September 30, 1999.

PRINCIPAL UNDERWRITER - American Funds Distributors, Inc. (the "Principal
Underwriter") is the principal underwriter of the funds' shares. The Principal
Underwriter is located at 333 South Hope Street, Los Angeles, CA 90071, 135
South State College Boulevard, Brea, CA 92821, 3500 Wiseman Boulevard, San
Antonio, TX 78251, 8332 Woodfield Crossing Boulevard, Indianapolis, IN 46240,
and 5300 Robin Hood Road, Norfolk, VA 23513. The fund has adopted a Plan of
Distribution (the Plan), pursuant to rule 12b-1 under the 1940 Act. The
Principal Underwriter receives amounts payable pursuant to the Plan (see below).

As required by rule 12b-1 and the 1940 Act, the Plan (together with the
Principal Underwriting Agreement) has been approved by the full Board of
Trustees and separately by a majority of the trustees who are not "interested
persons" of the fund and who have no direct or indirect financial interest in
the operation of the Plan or the Principal Underwriting Agreement, and the Plan
has been approved by the vote of a majority of the outstanding voting securities
of the fund. The officers and trustees who are "interested persons" of the fund
may be considered to have a direct or indirect financial interest in the
operation of the Plan due to present or past affiliations with the Investment
Adviser and related companies. Potential benefits of the Plan to the fund
include improved shareholder services, savings to the fund in transfer agency
costs, savings to the fund in advisory fees and other expenses, benefits to the
investment process from growth or stability of assets and maintenance of a
financially healthy management organization. The selection and nomination of
trustees who are not "interested persons" of the fund are committed to the
discretion of the trustees who are not "interested persons" during the existence
of the Plan. The Plan is reviewed quarterly and must be renewed annually by the
Board of Trustees.

Under the Plan each fund may expend up to 0.15% of its net assets annually to
finance any activity which is primarily intended to result in the sale of fund
shares, provided each fund's Board of Trustees has approved the category of
expenses for which payment is being made. In this regard, each fund's Board of
Trustees has approved one category of expenses: a service fee to be paid to
qualified dealers. During the fiscal year ended September 30, 1999, CMTA, CTRS
and CTEX paid 4,353,000, 438,000, and 109,000, respectively, to the Principal
Underwriter under the Plan (compensation to dealers). As of September 30, 1999,
distribution expenses accrued and unpaid were $342,000, $38,000 and $7,000 for
CMTA, CTRS and CTEX, respectively.

Money Market Funds -- Page 20

<PAGE>

DIVIDENDS, DISTRIBUTIONS AND TAXES

DAILY INCOME DIVIDENDS - A dividend from net investment income is declared each
day on shares of each fund. This dividend is payable to everyone who was a
shareholder at the close of business the previous day. Accordingly, when shares
are purchased dividends begin to accrue on the day following receipt by the
Transfer Agent of payment for the shares; when shares are redeemed, the shares
are entitled to the dividend declared on the day the redemption request is
received by the Transfer Agent. Dividends are automatically reinvested in
shares, on the last business day of the month, at net asset value (without sales
charge), unless a shareholder otherwise instructs the Transfer Agent in writing.
Shareholders so requesting will be mailed checks in the amount of the
accumulated dividends.

Under the penny-rounding method of pricing (see "Purchase of Shares"), each fund
rounds its per share net asset value to the nearer cent to maintain a stable net
asset value of $1.00 per share. Accordingly its share price ordinarily would not
reflect realized or unrealized gains or losses unless such gains or losses were
to cause the net asset value to deviate from $1.00 by one half-cent or more.
Pursuant to Securities and Exchange Commission regulations, the Trustees have
undertaken, as a particular responsibility within their overall duty of care
owed to shareholders, to assure to the extent reasonably practicable that each
fund's net asset value per share, rounded to the nearer cent, will not deviate
from $1.00. Among the steps that could be taken to maintain the net asset value
at $1.00 when realized or unrealized gains or losses approached one half-cent
per share would be to reflect all or a portion of such gains or losses in the
daily dividends declared. This would cause the amount of the daily dividends to
fluctuate and to deviate from a fund's net investment income for those days, and
could cause the dividend for a particular day to be negative. In that event a
fund would offset any such amount against the dividends that had been accrued
but not yet paid for that month. Alternatively, each fund has reserved the right
to adjust its total number of shares outstanding, if deemed advisable by the
Trustees, in order to maintain the net asset value of its shares at $1.00. This
would be done either by regarding each shareholder as having contributed to the
capital of the fund the number of full and fractional shares that
proportionately represents the excess, thereby reducing the number of
outstanding shares, or by declaring a stock dividend and increasing the number
of outstanding shares. Each shareholder will be deemed to have agreed to such
procedure by investing in a fund. Such action would not change a shareholder's
pro rata share of net assets, but would reflect the increase or decrease in the
value of the shareholder's holdings which resulted from the change in net asset
value.

The funds do not ordinarily realize short- or long-term capital gains or losses
on sales of securities. If a fund should realize gains or losses, it would
distribute to shareholders all of the excess of net long-term capital gain over
net short-term capital loss on sales of securities. Although each fund generally
maintains a stable net asset value of $1.00 per share, if the net asset value of
shares of a fund should, by reason of a distribution of realized capital gains,
be reduced below a shareholder's cost, such distribution would in effect be a
return of capital to that shareholder even though taxable to the shareholder,
and a sale of shares by a shareholder at net asset value at that time would
establish a capital loss for federal tax purposes. See also "Purchase of Shares"
below.

STATE TAXES - Information relating to the percentage of CTEX's income derived
from securities issued in a particular state is available upon request from the
Transfer Agent at year end.

Money Market Funds -- Page 21

<PAGE>

Since all of CTRS' dividends are expected to be attributable to income on U.S.
Treasury securities, they are generally exempt from state personal income taxes.
Also, some states do not have personal income taxes. CTRS believes that, as of
the date of this publication, neither the District of Columbia nor any state
impose an income tax on dividends attributable to income on U.S. Treasury
securities paid by the fund to individuals. However, other taxes may apply to
dividends paid by CTRS to individual shareholders. Further, any distributions of
capital gains will not be exempt from income taxes. Because tax laws vary from
state to state and may change over time, you should consult your tax adviser or
state tax authorities regarding the tax status of distributions from CTRS.
Corporate shareholders may be subject to income tax or other types of tax on
dividends they receive, even in those states that do not impose an income tax on
distributions to individual shareholders of CTRS. Corporate shareholders should
therefore seek advice from their tax adviser regarding the tax treatment of
distributions from CTRS.

ADDITIONAL INFORMATION CONCERNING TAXES

The following is only a summary of certain additional federal, state and local
tax considerations generally affecting CTEX and its shareholders. No attempt is
made to present a detailed explanation of the tax treatment of CTEX or its
shareholders, and the discussion here and in the funds' prospectus is not
intended as a substitute for careful tax planning. Investors should consult
their own tax advisers for additional details as to their particular tax
situations.

CTEX

GENERAL - CTEX is not intended to constitute a balanced investment program and
is not designed for investors seeking capital appreciation or maximum tax-exempt
income irrespective of fluctuations in principal. Shares of CTEX would generally
not be suitable for tax-exempt institutions or tax-deferred retirement plans
(e.g., corporate-type plans, Keogh-type plans and IRA's). Such retirement plans
would not gain any benefit from the tax-exempt nature of CTEX's dividends
because such dividends would be ultimately taxable to beneficiaries when
distributed to them. In addition, CTEX may not be an appropriate investment for
entities which are "substantial users" of facilities financed by private
activity bonds or "related persons" thereof. "Substantial user" is defined under
U.S. Treasury Regulations to include a non-exempt person who regularly uses a
part of such facilities in his trade or business and whose gross revenues
derived with respect to the facilities financed by the issuance of bonds are
more than 5% of the total revenues derived by all users of such facilities, or
who occupies more than 5% of the usable area of such facilities or for whom such
facilities or a part thereof were specifically constructed, reconstructed or
acquired. "Related persons" include certain related natural persons, affiliated
corporations, partnerships and their partners and S Corporations and their
shareholders.

The percentage of total dividends paid by CTEX with respect to any taxable year
which qualify for exclusion from gross income ("exempt-interest dividends") will
be the same for all shareholders receiving dividends during such year. In order
for CTEX to pay exempt-interest dividends during any taxable year, at the close
of each fiscal quarter at least 50% of the aggregate value of CTEX's assets must
consist of tax-exempt securities. Not later than 60 days after the close of its
taxable year, CTEX will notify each shareholder of the portion of the dividends
paid by CTEX to the shareholder with respect to such taxable year which
constitutes exempt-interest dividends. Shareholders are required by the Code to
report to the federal government all exempt-interest dividends received from the
fund (as well as all other similar interest). The aggregate amount of dividends
so designated cannot, however, exceed the excess of the amount of interest
excludable from gross income from tax under Section 103 of the Code received by
CTEX during

Money Market Funds -- Page 22

<PAGE>

the taxable year over any amounts disallowed as deductions under Sections 265
and 171(a)(2) of the Code.

Interest on indebtedness incurred by a shareholder to purchase or carry CTEX
shares is not deductible for federal income tax purposes if CTEX distributes
exempt-interest dividends during the shareholder's taxable year. Although CTEX
normally maintains a constant net asset value of $1.00 per share, in the event a
shareholder receives an exempt-interest dividend with respect to any share and
such share is held for six months or less, and is sold or exchanged at a loss,
such loss will be disallowed to the extent of the amount of such exempt-interest
dividend.

Money Market Funds -- Page 23

<PAGE>

PURCHASE OF SHARES

<TABLE>
<CAPTION>
METHOD INITIAL INVESTMENT ADDITIONAL INVESTMENTS
- -------------------------------------------------------------------------------
<S> <C> <C>
See "Investment $50 minimum (except where a
Minimums and Fund lower minimum is noted under
Numbers "for initial "Investment Minimums and Fund
investment minimums. Numbers").
- -------------------------------------------------------------------------------
By contacting Visit any investment Mail directly to your
your investment dealer dealer who is investment dealer's address
registered in the printed on your account
state where the statement.
purchase is made and
who has a sales
agreement with
American Funds
Distributors.
- -------------------------------------------------------------------------------
By mail Make your check Fill out the account additions
payable to the fund form at the bottom of a recent
and mail to the account statement, make your
address indicated on check payable to the fund,
the account write your account number on
application. Please your check, and mail the check
indicate an investment and form in the envelope
dealer on the account provided with your account
application. statement.
- -------------------------------------------------------------------------------
By telephone Please contact your Complete the "Investments by
investment dealer to Phone" section on the account
open account, then application or American
follow the procedures FundsLink Authorization Form.
for additional Once you establish the
investments. privilege, you, your financial
advisor or any person with your
account information can call
American FundsLine(R) and make
investments by telephone
(subject to conditions noted in
"Shareholder Account Services
and Privileges - Telephone and
Computer Purchases, Redemptions
and Exchanges" below).
- -------------------------------------------------------------------------------
By computer Please contact your Complete the American FundsLink
investment dealer to Authorization Form. Once you
open account, then established the privilege, you,
follow the procedures your financial advisor or any
for additional person with your account
investments. information may access American
FundsLine OnLine(R) on the
Internet and make investments
by computer (subject to
conditions noted in
"Shareholder Account Services
and Privileges - Telephone and
Computer Purchases, Redemptions
and Exchanges" below).
- -------------------------------------------------------------------------------
By wire Call800/421-0180 to Your bank should wire your
obtain your account additional investments in the
number(s), if same manner as described under
necessary. Please "Initial Investment."
indicate an investment
dealer on the account.
Instruct your bank to
wire funds to:

Wells Fargo Bank
155 Fifth Street,
Sixth Floor
San Francisco, CA
94106
(ABA#121000248)

For credit to the
account of:
American Funds Service
Company a/c#
4600-076178
(fund name)
(your fund acct. no.)
- -------------------------------------------------------------------------------
THE FUNDS AND AMERICAN FUNDS DISTRIBUTORS RESERVE THE RIGHT TO REJECT ANY
PURCHASE ORDER.
- -------------------------------------------------------------------------------
</TABLE>

Money Market Funds -- Page 24

<PAGE>

INVESTMENT MINIMUMS AND FUND NUMBERS - Here are the minimum initial investments
required by the funds in The American Funds Group along with fund numbers for
use with our automated phone line, American FundsLine/(R)/ (see description
below):

<TABLE>
<CAPTION>
MINIMUM
INITIAL FUND
FUND INVESTMENT NUMBER
---- ---------- ------
<S> <C> <C>
STOCK AND STOCK/BOND FUNDS
AMCAP Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 250 02
American Balanced Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . 250 11
American Mutual Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . . 250 03
Capital Income Builder/(R)/ . . . . . . . . . . . . . . . . . . . . . . 250 12
Capital World Growth and Income Fund/SM/ . . . . . . . . . . . . . . . . 250 33
EuroPacific Growth Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . 250 16
Fundamental Investors/SM/ . . . . . . . . . . . . . . . . . . . . . . . 250 10
The Growth Fund of America/(R)/ . . . . . . . . . . . . . . . . . . . . 250 05
The Income Fund of America/(R)/ . . . . . . . . . . . . . . . . . . . . 250 06
The Investment Company of America/(R)/ . . . . . . . . . . . . . . . . . 250 04
The New Economy Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . . 250 14
New Perspective Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . . 250 07
New World Fund/SM/ . . . . . . . . . . . . . . . . . . . . . . . . . . . 250 36
SMALLCAP World Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . . . 250 35
Washington Mutual Investors Fund/SM/ . . . . . . . . . . . . . . . . . . 250 01
BOND FUNDS
American High-Income Municipal Bond Fund/(R)/ . . . . . . . . . . . . . 250 40
American High-Income Trust/SM/ . . . . . . . . . . . . . . . . . . . . . 250 21
The Bond Fund of America/SM/ . . . . . . . . . . . . . . . . . . . . . . 250 08
Capital World Bond Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . 250 31
Intermediate Bond Fund of America/SM/ . . . . . . . . . . . . . . . . . 250 23
Limited Term Tax-Exempt Bond Fund of America/SM/ . . . . . . . . . . . . 250 43
The Tax-Exempt Bond Fund of America/(R)/ . . . . . . . . . . . . . . . . 250 19
The Tax-Exempt Fund of California/(R)/* . . . . . . . . . . . . . . . . 1,000 20
The Tax-Exempt Fund of Maryland/(R)/* . . . . . . . . . . . . . . . . . 1,000 24
The Tax-Exempt Fund of Virginia/(R)/* . . . . . . . . . . . . . . . . . 1,000 25
U.S. Government Securities Fund/SM/ . . . . . . . . . . . . . . . . . . 250 22
MONEY MARKET FUNDS
The Cash Management Trust of America/(R)/ . . . . . . . . . . . . . . . 1,000 09
The Tax-Exempt Money Fund of America/SM/ . . . . . . . . . . . . . . . . 1,000 39
The U.S. Treasury Money Fund of America/SM/ . . . . . . . . . . . . . . 1,000 49
___________
*Available only in certain states.
</TABLE>

Minimums are reduced to $50 for purchases through "Automatic Investment Plans"
(except for the money market funds) or to $25 for purchases by retirement plans
through payroll deductions and may be reduced or waived for shareholders of
other funds in The American Funds Group. TAX-EXEMPT FUNDS SHOULD NOT

Money Market Funds -- Page 25

<PAGE>

SERVE AS RETIREMENT PLAN INVESTMENTS. The minimum is $50 for additional
investments (except as noted above).

SALES CHARGES - The sales charges you pay when purchasing the stock, stock/bond,
and bond funds of The American Funds Group are set forth below. The money market
funds of The American Funds Group are offered at net asset value. (See
"Investment Minimums and Fund Numbers" for a listing of the funds.)

<TABLE>
<CAPTION>
<S> <C> <C> <C>
Amount of Purchase SALES CHARGE AS DEALER
at the Offering Price PERCENTAGE OF THE: CONCESSION
AS PERCENTAGE
OF THE
OFFERING
PRICE

NET AMOUNT OFFERING
INVESTED PRICE

STOCK AND STOCK/BOND FUNDS

Less than $25,000 6.10% 5.75% 5.00%

$25,000 but less than $50,000 5.26 5.00 4.25

$50,000 but less than $100,000 4.71 4.50 3.75

BOND FUNDS

Less than $100,000 3.90 3.75 3.00

STOCK, STOCK/BOND, AND BOND
FUNDS

$100,000 but less than 3.63 3.50 2.75
$250,000

$250,000 but less than 2.56 2.50 2.00
$500,000

$500,000 but less than 2.04 2.00 1.60
$750,000

$750,000 but less than 1.52 1.50 1.20
$1,000,000

$1,000,000 or more none none (see below)

</TABLE>

PURCHASES NOT SUBJECT TO SALES CHARGES - Investments of $1 million or more are
sold with no initial sales charge. HOWEVER, A 1% CONTINGENT DEFERRED SALES
CHARGE MAY BE IMPOSED IF REDEMPTIONS ARE MADE WITHIN ONE YEAR OF PURCHASE.
Employer-sponsored defined contribution-type plans investing $1 million or more,
or with 100 or more eligible employees, may invest with no sales charge and are
not subject to a contingent deferred sales charge. Investments made by
retirement plans, endowments or foundations with $50 million or more in assets
may also be made with no sales charge and are not subject to a contingent
deferred sales charge. A dealer concession of up to 1% may be paid by the fund
under its Plan of Distribution on investments made with no initial sales charge.

In addition, the stock, stock/bond and bond funds may sell shares at net asset
value to:

(1) current or retired directors, trustees, officers and advisory board members
of the funds managed by Capital Research and Management Company, employees of
Washington Man-

Money Market Funds -- Page 26

<PAGE>

agement Corporation, employees and partners of The Capital Group Companies, Inc.
and its affiliated companies, certain family members of the above persons, and
trusts or plans primarily for such persons;

(2) current registered representatives, retired registered representatives with
respect to accounts established while active, or full-time employees (and their
spouses, parents, and children) of dealers who have sales agreements with the
Principal Underwriter (or who clear transactions through such dealers) and plans
for such persons or the dealers;

(3) companies exchanging securities with the fund through a merger, acquisition
or exchange offer;

(4) trustees or other fiduciaries purchasing shares for certain retirement
plans of organizations with retirement plan assets of $50 million or more;

(5) insurance company separate accounts;

(6) accounts managed by subsidiaries of The Capital Group Companies, Inc.; and

(7) The Capital Group Companies, Inc., its affiliated companies and Washington
Management Corporation. Shares are offered at net asset value to these persons
and organizations due to anticipated economies in sales effort and expense.

DEALER COMMISSIONS - Commissions of up to 1% will be paid to dealers who
initiate and are responsible for purchases of $1 million or more, for purchases
by any employer-sponsored 403(b) plan or purchases by any defined contribution
plan qualified under Section 401(a) of the Internal Revenue Code including a
"401(k)" plan with 100 or more eligible employees, and for purchases made at net
asset value by certain retirement plans of organizations with collective
retirement plan assets of $50 million or more: 1.00% on amounts of $1 million to
$4 million, 0.50% on amounts over $4 million to $10 million, and 0.25% on
amounts over $10 million.

OTHER COMPENSATION TO DEALERS - The Principal Underwriter, at its expense (from
a designated percentage of its income), currently provides additional
compensation to dealers. Currently these payments are limited to the top 100
dealers who have sold shares of the fund or other funds in The American Funds
Group. These payments will be based principally on a pro rata share of a
qualifying dealer's sales. The Principal Underwriter will, on an annual basis,
determine the advisability of continuing these payments.

Qualified dealers currently are paid a continuing service fee not to exceed
0.25% of average net assets (0.15% in the case of the money market funds)
annually in order to promote selling efforts and to compensate them for
providing certain services. These services include processing purchase and
redemption transactions, establishing shareholder accounts and providing certain
information and assistance with respect to the fund.

REDUCING YOUR SALES CHARGE - You and your "immediate family" (your spouse and
your children under age 21) may combine investments to reduce your costs. You
must let your investment dealer or American Funds Service Company (the "Transfer
Agent") know if you qualify for a reduction in your sales charge using one or
any combination of the methods described below.

Money Market Funds -- Page 27

<PAGE>

STATEMENT OF INTENTION - You may enter into a non-binding commitment to
purchase shares of a fund(s) over a over a 13-month period and receive the
same sales charge as if all shares had been purchased at once. This
includes purchases made during the previous 90 days, but does not include
appreciation of your investment or reinvested distributions. The reduced
sales charges and offering prices set forth in the Prospectus apply to
purchases of $25,000 or more made within a 13-month period subject to the
following statement of intention (the "Statement"). The Statement is not a
binding obligation to purchase the indicated amount. When a shareholder
elects to utilize a Statement in order to qualify for a reduced sales
charge, shares equal to 5% of the dollar amount specified in the Statement
will be held in escrow in the shareholder's account out of the initial
purchase (or subsequent purchases, if necessary) by the Transfer Agent. All
dividends and any capital gain distributions on shares held in escrow will
be credited to the shareholder's account in shares (or paid in cash, if
requested). If the intended investment is not completed within the
specified 13-month period, the purchaser will remit to the Principal
Underwriter the difference between the sales charge actually paid and the
sales charge which would have been paid if the total of such purchases had
been made at a single time. If the difference is not paid by the close of
the period, the appropriate number of shares held in escrow will be
redeemed to pay such difference. If the proceeds from this redemption are
inadequate, the purchaser will be liable to the Principal Underwriter for
the balance still outstanding. The Statement may be revised upward at any
time during the 13-month period, and such a revision will be treated as a
new Statement, except that the 13-month period during which the purchase
must be made will remain unchanged. Existing holdings eligible for rights
of accumulation (see the account application) and any individual
investments in American Legacy variable annuities or variable life
insurance policies (American Legacy, American Legacy II, American Legacy
III, and American Legacy Shareholder's Advantage variable annuities,
American Legacy Life, American Legacy Variable Life, and American Legacy
Estate Builder) may be credited toward satisfying the Statement. During the
Statement period reinvested dividends and capital gain distributions,
investments in money market funds, and investments made under a right of
reinstatement will not be credited toward satisfying the Statement.

When the trustees of certain retirement plans purchase shares by payroll
deduction, the sales charge for the investments made during the 13-month
period will be handled as follows: The regular monthly payroll deduction
investment will be multiplied by 13 and then multiplied by 1.5. The current
value of existing American Funds investments (other than money market fund
investments) and any rollovers or transfers reasonably anticipated to be
invested in non-money market American Funds during the 13-month period, and
any individual investments in American Legacy variable annuities or
variable life insurance policies are added to the figure determined above.
The sum is the Statement amount and applicable breakpoint level. On the
first investment and all other investments made pursuant to the Statement,
a sales charge will be assessed according to the sales charge breakpoint
thus determined.

Shareholders purchasing shares at a reduced sales charge under a Statement
indicate their acceptance of these terms with their first purchase.

AGGREGATION - Sales charge discounts are available for certain aggregated
investments. Qualifying investments include those by you, your spouse and
your children under the age of 21, if all parties are purchasing shares for
their own accounts and/or:

Money Market Funds -- Page 28

<PAGE>

- employee benefit plan(s), such as an IRA, individual-type 403(b) plan,
or single-participant Keogh-type plan;

- business accounts solely controlled by these individuals (for example,
the individuals own the entire business);

- trust accounts established by the above individuals. However, if the
person(s) who established the trust is deceased, the trust account may
be aggregated with accounts of the person who is the primary
beneficiary of the trust.

Individual purchases by a trustee(s) or other fiduciary(ies) may also be
aggregated if the investments are:

- for a single trust estate or fiduciary account, including an employee
benefit plan other than those described above;

- made for two or more employee benefit plans of a single employer or of
affiliated employers as defined in the 1940 Act, again excluding
employee benefit plans described above; or

- for a diversified common trust fund or other diversified pooled
account not specifically formed for the purpose of accumulating fund
shares.

Purchases made for nominee or street name accounts (securities held in the
name of an investment dealer or another nominee such as a bank trust
department instead of the customer) may not be aggregated with those made
for other accounts and may not be aggregated with other nominee or street
name accounts unless otherwise qualified as described above.

CONCURRENT PURCHASES - You may combine purchases of two or more funds in
The American Funds Group, as well as individual holdings in various
American Legacy variable annuities and variable life insurance policies.
Direct purchases of the money market funds are excluded. Shares of money
market funds purchased through an exchange, reinvestment or
cross-reinvestment from a fund having a sales charge do qualify.

RIGHTS OF ACCUMULATION - You may take into account the current value of
your existing holdings in The American Funds Group, as well as your
holdings in Endowments (shares of which may be owned only by tax-exempt
organizations), to determine your sales charge on investments in accounts
eligible to be aggregated, or when making a gift to an individual or
charity. When determining your sales charge, you may also take into account
the value of your individual holdings, as of the end of the week prior to
your investment, in various American Legacy variable annuities and variable
life insurance policies. Direct purchases of the money market funds are
excluded.

PRICE OF MONEY MARKET FUND SHARES - The price you pay for fund shares (normally
$1.00) is the net asset value per share which is calculated once daily at the
normal close of trading (currently 4:00 p.m., New York time) each day the New
York Stock Exchange is open. For example, if the Exchange closes at 1:00 p.m.
on one day and at 4:00 p.m. on the next, the fund's share price would be
determined as of 4:00 p.m. New York time on both days. The New York Stock
Exchange is currently closed on weekends and on the following holidays: New
Year's Day,

Money Market Funds -- Page 29

<PAGE>

Martin Luther King, Jr.'s Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving and Christmas Day.

The valuation of each fund's portfolio securities and calculation of its net
asset value are based upon the penny-rounding method of pricing pursuant to
Securities and Exchange Commission regulations. Under the Securities and
Exchange Commission regulations permitting the use of the penny-rounding method
of pricing, each fund must maintain a dollar-weighted average portfolio maturity
of 90 days or less, purchase instruments having remaining maturities of 13
months or less only (25 months or less in the case of U.S. Government
securities), and invest only in securities determined by the Board of Trustees
to be of high quality with minimal credit risks.

1. All securities with 60 days or less to maturity are amortized to maturity
based on their cost if acquired within 60 days of maturity, or if already held
on the 60th day, based on the value determined on the 61st day. The maturities
of variable or floating rate instruments, with the right to resell them at an
agreed-upon price to the issuer or dealer, are deemed to be the time remaining
until the later of the next interest adjustment date or until they can be
resold.

Other securities with more than 60 days remaining to maturity are valued at
prices obtained from a pricing service selected by the Investment Adviser,
except that, where such prices re not available or where the Investment Adviser
has determined that such prices do not reflect current market value, they are
valued at the mean between current bid and ask quotations obtained from one or
more dealers in such securities.

Where market prices or market quotations are not readily available, securities
are valued at fair value as determined in good faith by the Board of Trustees or
a committee thereof. The fair value of all other assets is added to the value
of securities to arrive at the total assets;

2. There are deducted from the total assets, thus determined, the liabilities,
including proper accruals of expense items; and

3. The net assets so obtained are then divided by the total number of shares
outstanding, and the result, rounded to the nearer cent, is the net asset value
per share. The net asset value of each share will normally remain constant at
$1.00.

In case of orders sent directly to a fund or American Funds Service Company, an
investment dealer MUST be indicated. Any purchase order may be rejected by the
Principal Underwriter or by the funds.

SELLING SHARES

Shares are sold at the net asset value next determined after your request is
received in good order by the Transfer Agent. You may sell (redeem) shares in
your account in any of the following ways:

THROUGH YOUR DEALER (certain charges may apply)

-Shares held for you in your dealer's street name must be sold through the
dealer.

Money Market Funds -- Page 30

<PAGE>

WRITING TO AMERICAN FUNDS SERVICE COMPANY

- Requests must be signed by the registered shareholder(s)

- A signature guarantee is required if the redemption is:

- Over $50,000;

- Made payable to someone other than the registered shareholder(s);
or

- Sent to an address other than the address of record, or an address
of record which has been changed within the last 10 days.

Your signature may be guaranteed by a domestic stock exchange or the National
Association of Securities Dealers, Inc., bank, savings association or credit
union that is an eligible guarantor institution.

- Additional documentation may be required for sales of shares held in
corporate, partnership or fiduciary accounts.

- You must include any shares you wish to sell that are in certificate
form.

TELEPHONING OR FAXING AMERICAN FUNDS SERVICE COMPANY, OR BY USING AMERICAN
FUNDSLINE/(R)/ OR AMERICAN FUNDSLINE ONLINE/(R)/

- Redemptions by telephone or fax (including American FundsLine/(R)/ and
American FundsLine OnLine/(R)/) are limited to $50,000 per shareholder each
day.

- Checks must be made payable to the registered shareholder(s).

- Checks must be mailed to an address of record that has been used with the
account for at least 10 days.

MONEY MARKET FUNDS

-You may have redemptions of $1,000 or more wired to your bank by writing
American Funds Service Company.

-You may establish check writing privileges (use the money market funds
application).

- If you request check writing privileges, you will be provided with
checks that you may use to draw against your account. These checks may
be made payable to anyone you designate and must be signed by the
authorized number or registered shareholders exactly as indicated on
your checking account signature card.

Redemption proceeds will not be mailed until sufficient time has passed to
provide reasonable assurance that checks or drafts (including certified or
cashier's checks) for shares purchased have cleared (which may take up to 15
calendar days from the purchase date). Except for delays

Money Market Funds -- Page 31

<PAGE>

relating to clearance of checks for share purchases or in extraordinary
circumstances (and as permissible under the 1940 Act), sale proceeds will be
paid on or before the seventh day following receipt and acceptance of an order.
Interest will not accrue or be paid on amounts that represent uncashed
distribution or redemption checks.

You may reinvest proceeds from a redemption or a dividend or capital gain
distribution without a sales charge (any contingent deferred sales charge paid
will be credited to your account) in any fund in The American Funds Group within
90 days after the date of the redemption or distribution. Redemption proceeds of
shares representing direct purchases in the money market funds are excluded.
Proceeds will be reinvested at the next calculated net asset value after your
request is received and accepted by the Transfer Agent.

CONTINGENT DEFERRED SALES CHARGE - A contingent deferred sales charge of 1%
applies to certain redemptions from funds other than the money market funds made
within twelve months of purchase on investments of $1 million or more (other
than redemptions by employer-sponsored retirement plans). The charge is 1% of
the lesser of the value of the shares redeemed (exclusive of reinvested
dividends and capital gain distributions) or the total cost of such shares.
Shares held for the longest period are assumed to be redeemed first for purposes
of calculating this charge. The charge is waived for exchanges (except if shares
acquired by exchange were then redeemed within 12 months of the initial
purchase); for distributions from 403(b) plans or IRAs due to death, disability
or attainment of age 591/2; for tax-free returns of excess contributions to
IRAs; and for redemptions through certain automatic withdrawals not exceeding
10% of the amount that would otherwise be subject to the charge.

SHAREHOLDER ACCOUNT SERVICES AND PRIVILEGES

AUTOMATIC INVESTMENT PLAN - An automatic investment plan enables you to make
monthly or quarterly investments into the American Funds through automatic
debits from your bank account. To set up a plan you must fill out an account
application and specify the amount you would like to invest ($50 minimum) and
the date on which you would like your investments to occur. The plan will begin
within 30 days after your account application is received. Your bank account
will be debited on the day or a few days before your investment is made,
depending on the bank's capabilities. The Transfer Agent will then invest your
money into the fund you specified on or around the date you specified. If your
bank account cannot be debited due to insufficient funds, a stop-payment or the
closing of the account, the plan may be terminated and the related investment
reversed. You may change the amount of the investment or discontinue the plan at
any time by writing to the Transfer Agent. Checks that remain uncashed earn no
interest.

AUTOMATIC REINVESTMENT - Dividends and capital gain distributions are reinvested
in additional shares at no sales charge unless you indicate otherwise on the
account application. You also may elect to have dividends and/or capital gain
distributions paid in cash by informing the fund, the Transfer Agent or your
investment dealer.

If you have elected to receive dividends and/or capital gain distributions in
cash, and the postal or other delivery service is unable to deliver checks to
your address of record, or you do not respond to mailings from American Funds
Service Company with regard to uncashed distribution checks, your distribution
option will automatically be converted to having all dividends and other
distributions reinvested in additional shares.

Money Market Funds -- Page 32

<PAGE>

CROSS-REINVESTMENT OF DIVIDENDS AND DISTRIBUTIONS - You may cross-reinvest
dividends and capital gains ("distributions") into any other fund in The
American Funds Group at net asset value, subject to the following conditions:

(a) The aggregate value of your account(s) in the fund(s) paying distributions
equals or exceeds $5,000 (this is waived if the value of the account in the fund
receiving the distributions equals or exceeds that fund's minimum initial
investment requirement),

(b) If the value of the account of the fund receiving distributions is below
the minimum initial investment requirement, distributions must be automatically
reinvested,

(c) If you discontinue the cross-reinvestment of distributions, the value of
the account of the fund receiving distributions must equal or exceed the minimum
initial investment requirement. If you do not meet this requirement within 90
days of notification, the fund has the right to automatically redeem the
account.

EXCHANGE PRIVILEGE - You may exchange shares into other funds in The American
Funds Group. Exchange purchases are subject to the minimum investment
requirements of the fund purchased and no sales charge generally applies.
However, exchanges of shares from the money market funds are subject to
applicable sales charges on the fund being purchased, unless the money market
fund shares were acquired by an exchange from a fund having a sales charge, or
by reinvestment or cross-reinvestment of dividends or capital gain
distributions.

You may exchange shares by writing to the Transfer Agent (see "Redeeming
Shares"), by contacting your investment dealer, by using American FundsLine and
American FundsLine OnLine (see "American FundsLine and American FundsLine
OnLine" below), or by telephoning 800/421-0180 toll-free, faxing (see "Principal
Underwriter and Transfer Agent" in the prospectus for the appropriate fax
numbers) or telegraphing the Transfer Agent. (See "Telephone and Computer
Purchases, Redemptions and Exchanges" below.) Shares held in corporate-type
retirement plans for which Capital Guardian Trust Company serves as trustee may
not be exchanged by telephone, computer, fax or telegraph. Exchange redemptions
and purchases are processed simultaneously at the share prices next determined
after the exchange order is received. (See "Purchase of Shares--Price of
Shares.") THESE TRANSACTIONS HAVE THE SAME TAX CONSEQUENCES AS ORDINARY SALES
AND PURCHASES.

AUTOMATIC EXCHANGES - You may automatically exchange shares in amounts of $50 or
more among any of the funds in The American Funds Group on any day (or preceding
business day if the day falls on a non-business day of each month you designate.
You must either (a) meet the minimum initial investment requirement for the
receiving fund OR (b) the originating fund's balance must be at least $5,000 and
the receiving fund's minimum must be met within one year.

AUTOMATIC WITHDRAWALS - Withdrawal payments are not to be considered as
dividends, yield or income. Automatic investments may not be made into a
shareholder account from which there are automatic withdrawals. Withdrawals of
amounts exceeding reinvested dividends and distributions and increases in share
value would reduce the aggregate value of the shareholder's account. The
Transfer Agent arranges for the redemption by the fund of sufficient shares,
deposited by the shareholder with the Transfer Agent, to provide the withdrawal
payment specified.

Money Market Funds -- Page 33

<PAGE>

ACCOUNT STATEMENTS - Your account is opened in accordance with your registration
instructions. Transactions in the account, such as additional investments will
be reflected on regular confirmation statements from the Transfer Agent.
Dividend and capital gain reinvestments and purchases through automatic
investment plans and certain retirement plans will be confirmed at least
quarterly.

AMERICAN FUNDSLINE AND AMERICAN FUNDSLINE ONLINE - You may check your share
balance, the price of your shares, or your most recent account transaction,
redeem shares (up to $50,000 per shareholder each day), or exchange shares
around the clock with American FundsLine and American FundsLine OnLine. To use
these services, call 800/325-3590 from a TouchTone(TM) telephone or access the
American Funds Web site on the Internet at www.americanfunds.com. Redemptions
and exchanges through American FundsLine and American FundsLine OnLine are
subject to the conditions noted above and in "Shareholder Account Services and
Privileges - Telephone and Computer Purchases, Redemptions and Exchanges" below.
You will need your fund number (see the list of funds in The American Funds
Group under "Purchase of Shares - Investment Minimums and Fund Numbers"),
personal identification number (the last four digits of your Social Security
number or other tax identification number associated with your account) and
account number.

TELEPHONE AND COMPUTER PURCHASES, REDEMPTIONS AND EXCHANGES - By using the
telephone (including American FundsLine) or computer (including American
FundsLine OnLine), fax or telegraph purchase, redemption and/or exchange
options, you agree to hold the fund, the Transfer Agent, any of its affiliates
or mutual funds managed by such affiliates, and each of their respective
directors, trustees, officers, employees and agents harmless from any losses,
expenses, costs or liability (including attorney fees) which may be incurred in
connection with the exercise of these privileges. Generally, all shareholders
are automatically eligible to use these options. However, you may elect to opt
out of these options by writing the Transfer Agent (you may also reinstate them
at any time by writing the Transfer Agent). If the Transfer Agent does not
employ reasonable procedures to confirm that the instructions received from any
person with appropriate account information are genuine, the fund may be liable
for losses due to unauthorized or fraudulent instructions. In the event that
shareholders are unable to reach the fund by telephone because of technical
difficulties, market conditions, or a natural disaster, redemption and exchange
requests may be made in writing only.

REDEMPTION OF SHARES - Each fund's declaration of trust permits the fund to
direct the Transfer Agent to redeem the shares of any shareholder for their then
current net asset value per share if at such time the shareholder owns of record
shares having an aggregate net asset value of less than the minimum initial
investment amount required of new shareholders as set forth in the fund's
current registration statement under the 1940 Act, and subject to such further
terms and conditions as the Board of Trustees of the fund may from time to time
adopt.

CHECK WRITING -- When the checks you write are presented to The Chase Manhattan
Bank for payment, the bank will instruct the Transfer Agent to withdraw the
appropriate number of shares from your account (provided payment for the shares
has been collected). The bank's rules and regulations governing such checking
accounts include the right of the bank not to honor checks in amounts exceeding
the value of the account at the time the check is presented for payment. Each
month canceled checks will be returned to you. Generally, you pay no fee for
this check writing service; however, reasonable service charges for "regular or
frequent use" of this service may be assessed in the future. Besides being
convenient, this procedure enables you to continue earning daily income
dividends on your money until your checks actually clear.

Money Market Funds -- Page 34

<PAGE>

EXECUTION OF PORTFOLIO TRANSACTIONS

The Investment Adviser places orders for the fund's portfolio securities
transactions. The Investment Adviser strives to obtain the best available prices
in its portfolio transactions taking into account the costs and quality of
executions. When, in the opinion of the Investment Adviser, two or more brokers
(either directly or through their correspondent clearing agents) are in a
position to obtain the best price and execution, preference may be given to
brokers who have sold shares of the fund or who have provided investment
research, statistical, or other related services to the Investment Adviser. The
fund does not consider that it has an obligation to obtain the lowest available
commission rate to the exclusion of price, service and qualitative
considerations.

There are occasions on which portfolio transactions for the fund may be executed
as part of concurrent authorizations to purchase or sell the same security for
other funds served by the Investment Adviser, or for trusts or other accounts
served by affiliated companies of the Investment Adviser. Although such
concurrent authorizations potentially could be either advantageous or
disadvantageous to the fund, they are effected only when the Investment Adviser
believes that to do so is in the interest of the fund. When such concurrent
authorizations occur, the objective is to allocate the executions in an
equitable manner. The fund will not pay a mark-up for research in principal
transactions.

GENERAL INFORMATION

CUSTODIAN OF ASSETS - Securities and cash owned by the funds, including proceeds
from the sale of shares of the fund and of securities in the fund's portfolio,
are held by The Chase Manhattan Bank, One Chase Manhattan Plaza, New York, NY
10081, as Custodian. If the funds hold non-U.S. securities, the Custodian may
hold these securities pursuant to sub-custodial arrangements in non-U.S. banks
or foreign branches of U.S. banks.

TRANSFER AGENT - American Funds Service Company, a wholly owned subsidiary of
the Investment Adviser, maintains the records of each shareholder's account,
processes purchases and redemptions of each fund's shares, acts as dividend and
capital gain distribution disbursing agent, and performs other related
shareholder service functions. American Funds Service Company was paid a fee of
$6,887,000, $411,000, and $153,000, by CMTA, CTRS and CTEX, respectively, for
the fiscal year ended September 30, 1999.

INDEPENDENT ACCOUNTANTS - PricewaterhouseCoopers LLP, 400 South Hope Street, Los
Angeles, CA 90071, serves as each fund's independent accountants providing
audit services, preparation of tax returns and review of certain documents to be
filed with the Securities and Exchange Commission. The financial statements
included in this Statement of Additional Information from the Annual Report have
been so included in reliance on the report PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
accounting and auditing. The selection of each fund's independent accountants is
reviewed and determined annually by the Board of Trustees.

REPORTS TO SHAREHOLDERS - Each fund's fiscal year ends on September 30.
Shareholders are provided at least semiannually with reports showing the
investment portfolio, financial statements and other information. Each fund's
annual financial statements are audited by the fund's independent accountants,
PricewaterhouseCoopers LLP. In an effort to reduce the volume of mail
shareholders receive from the fund when a household owns more than one account,
the

Money Market Funds -- Page 35

<PAGE>

Transfer Agent has taken steps to eliminate duplicate mailings of shareholder
reports. To receive additional copies of a report, shareholders should contact
the Transfer Agent.

YEAR 2000 - Each fund and its shareholders depend on the proper functioning of
computer systems maintained by the Investment Adviser and its affiliates and
other key service providers. The funds understand that these service providers
have updated all of their computer systems to process date-related information
properly following the turn of the century. However, there can be no assurance
that these steps are sufficient to avoid any adverse impact on the fund. In
addition, the fund's investments could be adversely affected by the Year 2000
problem. For example, the markets for securities in which the fund invests could
experience settlement problems and liquidity issues. Corporate and governmental
data processing errors may cause losses for individual companies and overall
economic uncertainties. Earnings of individual issuers are likely to be affected
by the costs of addressing the problem, which may be substantial and may be
reported inconsistently.

PERSONAL INVESTING POLICY - The funds, Capital Research and Management Company
and its affiliated companies, including the funds' principal underwriter, have
adopted codes of ethics which allow for personal investments. The personal
investing policy is consistent with Investment Company Institute guidelines.
This policy includes: a ban on acquisitions of securities pursuant to an initial
public offering; restrictions on acquisitions of private placement securities;
pre-clearance and reporting requirements; review of duplicate confirmation
statements; annual recertification of compliance with codes of ethics; blackout
periods on personal investing for certain investment personnel; ban on
short-term trading profits for investment personnel; limitations on service as a
director of publicly traded companies; and disclosure of personal securities
transactions.

SHAREHOLDER AND TRUSTEE RESPONSIBILITY - Under the laws of certain states,
including Massachusetts where each fund was organized and California where the
fund's principal office is located, shareholders of a Massachusetts business
trust may, under certain circumstances, be held personally liable as partners
for the obligations of the fund. However, the risk of a shareholder incurring
any financial loss on account of shareholder liability is limited to
circumstances in which a fund itself would be unable to meet its obligations.
The Declaration of Trust contains an express disclaimer of shareholder liability
for acts, omissions, obligations or affairs of the fund and provides that notice
of the disclaimer may be given in each agreement, obligation, or instrument
which is entered into or executed by the fund or Trustees. The Declaration of
Trust provides for indemnification out of fund property of any shareholder held
personally liable for the obligations of each fund and also provides for each
fund to reimburse such shareholder for all legal and other expenses reasonably
incurred in connection with any such claim or liability.

Under the Declaration of Trust, the Trustees, officers, employees or agents of
each fund are not liable for actions or failure to act; however, they are not
protected from liability by reason of their willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in the conduct of
their office.

INVESTMENT RESULTS AND RELATED STATISTICS

Each fund may from time to time provide yield information (including CTEX
tax-equivalent yield information) or comparisons of the fund's yield to various
averages in advertisements or in reports furnished to current or prospective
shareholders. Yield will be calculated on a seven-day,

Money Market Funds -- Page 36

<PAGE>

tax-equivalent and effective basis, as appropriate, pursuant to formulas
prescribed by the Securities and Exchange Commission:

Seven-day yield = (net change in account value x /365//\\7\\)

Tax-equivalent yield = tax-exempt portion of seven-day yield/(1-stated
income tax rate) + taxable portion of seven day yield

Effective yield* = [1 + (net change in account value) /1//\\7\\]/365/

*The effective yield will assume a year's compounding of the seven-day
yield.

CMTA The seven-day and effective yields for the period ended September 30, 1999
- ----
are calculated as follows:

ASSUMPTIONS:

Value of hypothetical pre-existing account with exactly one share at the
beginning of the period: $1.0000000

Value of same account* (excluding capital changes) at the end of the
seven-day period ending September 30, 1999: $1.00088449

*Value includes additional shares acquired with dividends paid on the
original share.

CALCULATION:

Ending account value: $1.00088449

Less beginning account value: $1.00000000

Net change in account value: $0.00088449

Seven-day yield = (0.00088449 /365/7/) = 4.61%

Effective yield = [1 + (0.00088449) /1//\\7\\]/365/ = 4.72%

CTRS The seven-day and effective yields for the period ended September 30, 1999
- ----
are calculated as follows:

ASSUMPTIONS:

Value of hypothetical pre-existing account with exactly one share at the
beginning of the period: $1.0000000

Value of same account* (excluding capital changes) at the end of the
seven-day period ending September 30, 1999: $1.00082767

*Value includes additional shares acquired with dividends paid on the
original share.

Money Market Funds -- Page 37

<PAGE>

CALCULATION:

Ending account value: $1.00082767

Less beginning account value: $1.00000000

Net change in account value: $0.00082767

Seven-day yield = (0.00082767 X /365/7/) = 4.23%

Effective yield = [1 + (0.00082767)/1//\\7\\]/365/ = 4.41%

CTEX The seven-day, effective and tax-equivalent yields for the period ended
- ----
September 30, 1999 are calculated as follows:

ASSUMPTIONS:

Value of hypothetical pre-existing account with exactly one share at the
beginning of the period: $1.0000000

Value of same account* (excluding capital changes) at the end of the
seven-day period ending September 30, 1999: $1.0005568

*Value includes additional shares acquired with dividends paid on the
original share.

CALCULATION:

Ending account value: $1.00055568

Less beginning account value: $1.0000000

Net change in account value: $0.00055568

Tax-exempt portion of net change: $0.00055568

Taxable portion of net change: $ -0-

Seven-day yield = ($0.00055568 X /365/7/)
= 2.90%

Seven-day tax equivalent yield = ($0.00055568 X /365/7//(1-0.396)) =
4.80%

Effective yield = [1 + ($0.00055568 X
1/7]/365/ = 2.94%

Each fund's investment results may also be calculated for longer periods in
accordance with the following method: by subtracting (a) the net asset value of
one share at the beginning of the period, from (b) the net asset value of all
shares an investor would own at the end of the period for the share held at the
beginning of the period (assuming reinvestment of all dividends and
distributions) and dividing by (c) the net asset value per share at the
beginning of the period. The resulting percentage indicates the positive or
negative rate of return that an investor would have earned from reinvested
dividends and distributions and any changes in share price during the

Money Market Funds -- Page 38

<PAGE>

period. Based on the foregoing formula, the lifetime return of CMTA was 409.4%
(for the period 11/3/76 through 9/30/99), the lifetime return of CTEX was 35.5%
(for the period 10/24/89 through 9/30/99), and the lifetime return of CTRS was
41.5% (for the period 2/1/91 through 9/30/99).

Each fund's investment results will vary from time to time depending upon market
conditions, the composition of the fund's portfolio and operating expenses of
the fund, so that any yield figure should not be considered representative of
what an investment in a fund may earn in any future period. These factors and
possible differences in calculation methods should be considered when comparing
each fund's investment results with those published for other investment
companies, other investment vehicles and averages. Investment results also
should be considered relative to the risks associated with the investment
objective and policies.

Money Market Funds -- Page 39

<PAGE>

CMTA VS. MONEY MARKET FUND AVERAGE ("MMFA") AND BANK AVERAGE ("BA")

The information below permits investors to compare the results of similar
investment vehicles.

<TABLE>
<CAPTION>
5-YEAR PERIOD CMTA MMFA* BA**
------------- ---- ----- ----
<S> <C> <C> <C>
10/1/94 - 9/30/99 + 27.8% + 27.3% + 24.6%

10-Year Period
1989 - 1999 60.9% 60.5% 60.5%
1988 - 1998 67.7 66.8 64.3
1987 - 1997 70.7 69.2 67.0
1986 - 1996 72.4 70.3 69.0
1985 - 1995 75.6 73.1 73.5
1984 - 1994 80.9 78.0 80.5
1983 - 1993 93.6 89.3 90.9
1982 - 1992 105.7 100.0 101.6
1981 - 1991 126.2 118.6 113.0
1980 - 1990 149.2 135.9 120.9
1979 - 1989 159.8 NA 123.7
1978 - 1988 162.0 NA 123.8
1977 - 1987 159.8 NA 123.9
</TABLE>

* Based on yields compiled by the following publications: for figures prior to
1/1/91, the source is the Money Market Fund Survey published by Survey
Publications; for figures beginning 1/1/91, IBC/Donoghue's Money Fund Report
is used. These publications provide 30-day average yield figures on 1.407
money market funds. This yield figure is mathematically converted to a
per-share dividend amount which is then used to produce hypothetical results
for the average money market fund.
** Calculated from figures supplied by the U.S. League of Savings Institutions
and the Federal Reserve Board which are based on effective annual rates of
interest on both passbook and certificate accounts. Savings accounts offer a
guaranteed return of principal and a fixed rate of interest but no opportunity
for capital growth.

CTEX VS. TAX-EXEMPT MONEY MARKET FUND AVERAGE ("MMFA") AND BANK AVERAGE ("BA")

TAX-EXEMPT
LIFETIME PERIOD CTEX MMFA# BA
- --------------- ---- ----- --
<S> <C> <C> <C>

10/24/89 - 9/30/99 +35.5% +36.0% +60.5%
</TABLE>

# Same as * except it is for tax-exempt money market funds

CTRS VS. GOVT MONEY MARKET FUND AVERAGE (" GOVT MMFA") AND BANK AVERAGE ("BA")

GOVT
LIFETIME PERIOD CTRS MMFA@ BA
- --------------- ---- ----- --
<S> <C> <C> <C>

2/1/91 - 9/30/99 +41.5% +43.5% +47.1%
</TABLE>

@ Same as * except it is for Government money market funds

Money Market Funds -- Page 40

<PAGE>

APPENDIX
Description of Commercial Paper Ratings

MOODY'S employs the designations "Prime-1," "Prime-2" and "Prime-3" to indicate
- -------
commercial paper having the highest capacity for timely repayment. Issuers rated
Prime-1 have a superior capacity for repayment of short-term promissory
obligations. Prime-1 repayment capacity will normally be evidenced by the
following characteristics: leading market positions in well-established
industries; high rates of return on funds employed; conservative capitalization
structures with moderate reliance on debt and ample asset protection; broad
margins in earnings coverage of fixed financial charges and high internal cash
generation; and well-established access to a range of financial markets and
assured sources of alternate liquidity.

Issues rated Prime-2 have a strong capacity for repayment of short-term
promissory obligations. This will normally be evidenced by many of the
characteristics cited above, but to a lesser degree. Earnings trends and
coverage ratios, while sound, will be more subject to variation. Capitalization
characteristics, while still appropriate, may be more affected by external
conditions. Ample alternate liquidity is maintained.

S&P ratings of commercial paper are graded into four categories ranging from "A"
- ---
for the highest quality obligations to "D" for the lowest.

A -- Issues assigned its highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are delineated with numbers
1, 2, and 3 to indicate the relative degree of safety.

A-1 -- This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+) sign
designation.

A-2 -- Capacity for timely payments on issues with this designation is strong;
however, the relative degree of safety is not as high as for issues designated
"A-1."

Description of Bond Ratings

BOND RATINGS -- The ratings of Moody's Investors Service, Inc. (Moody's) and
Standard & Poor's Corporation (S&P) represent their opinions as to the quality
of the municipal bonds which they undertake to rate. It should be emphasized,
however, that ratings are general and are not absolute standards of quality.
Consequently, municipal bonds with the same maturity, coupon and rating may
have different yields, while municipal bonds of the same maturity and coupon
with different ratings may have the same yield.

Moody's rates the long-term debt securities issued by various entities from
- -------
"Aaa" to "C." Moody's applies the numerical modifiers 1, 2, and 3 in each
generic rating classification from Aa through B in its corporate bond rating
system. The modifier 1 indicates that the security ranks in the higher end of
its generic rating category; the modifier 2 indicates a mid-range ranking; and
the modifier 3 indicates that the issue ranks in the lower end of its generic
rating category. Ratings are described as follows:

"Bonds which are rated Aaa are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as 'gilt edge.'
Interest payments are protected by

Money Market Funds -- Page 41

<PAGE>

a large or by an exceptionally stable margin, and principal is secure. While
the various protective elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong position of such
issues."

"Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group, they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities, or fluctuation of
protective elements may be of greater amplitude, or there may be other elements
present which make the long-term risks appear somewhat larger than the Aaa
securities."

"Bonds which are rated A possess many favorable investment attributes and are to
be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future."

"Bonds which are rated Baa are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and, in
fact, have speculative characteristics as well."

"Bonds which are rated Ba are judged to have speculative elements; their future
cannot be considered as well assured. Often the protection of interest and
principal payments may be very moderate and thereby not well safeguarded during
both good and bad times over the future. Uncertainty of position characterizes
bonds in this class."

"Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small."

"Bonds which are rated Caa are of poor standing. Such issues may be in default
or there may be present elements of danger with respect to principal or
interest."

"Bonds which are rated Ca represent obligations which are speculative in a high
degree. Such issues are often in default or have other marked shortcomings."

"Bonds which are rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing."

S & P rates the long-term securities debt of various entities in categories
- -----
ranging from "AAA" to "D" according to quality. The ratings from "AA" to "CCC"
may be modified by the addition of a plus (+) or minus (-) sign to show relative
standing within the major rating categories. Ratings are described as follows:

"Debt rated 'AAA' has the highest rating assigned by S & P. Capacity to pay
interest and repay principal is extremely strong."

"Debt rated 'AA' has a very strong capacity to pay interest and repay principal
and differs from the higher rated issues only in small degree."

"Debt rated 'A' has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories."

Money Market Funds -- Page 42

<PAGE>

"Debt rated 'BBB' is regarded as having an adequate capacity to pay interest and
repay principal. Whereas it normally exhibits adequate protection parameters,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay interest and repay principal for debt in this
category than in higher rated categories."

"Debt rated 'BB' has less near-term vulnerability to default than other
speculative issues. However, it faces major ongoing uncertainties or exposure
to adverse business, financial, or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. The 'BB'
rating category is also used for debt subordinated to senior debt that is
assigned an actual or impled 'BBB-' rating.

"Debt rated 'B' has a greater vulnerability to default but currently has the
capacity to meet interest payments and principal repayments. Adverse business,
financial, or economic conditions will likely impair capacity or willingness to
pay interest and repay principal. The 'B' rating category is also used for debt
subordinated to senior debt that is assigned an actual or implied 'BB' or 'BB-'
rating."

"The rating 'CC' is typically applied to debt subordinated to senior debt that
is assigned an actual or implied 'CCC' rating."

"The rating 'C' is typically applied to debt subordinated to senior debt which
is assigned an actual or implied 'CCC-' debt rating. The 'C' rating may be used
to cover a situation where a bankruptcy petition has been filed, but debt
service payments are continued."

"The rating 'C1' is reserved for income bonds on which no interest is being
paid."

"Debt rated 'D' is in payment default. The 'D' rating category is used when
interest payments or principal payments are not made on the date due even if the
applicable grace period has not expired, unless S&P believes that such payments
will be made during such grace period. The 'D' rating also will be used upon
the filing of a bankruptcy petition if debt service payments are jeopardized."

Note Ratings

STANDARD & POOR'S CORPORATION: "SP-1" and "SP-2" are the two highest note rating
categories, and are described as follows:

"SP-1 Very strong or strong capacity to pay principal and interest. Those issues
determined to possess overwhelming safety characteristics will be given a plus
(+) designation."

"SP-2 Satisfactory capacity to pay principal and interest."

MOODY'S INVESTORS SERVICE, INC.: "MIG-1" and "MIG-2" are the two highest note
rating categories, and are described as follows:

"MIG 1: This designation denotes best quality. There is present strong
protection by established cash flows, superior liquidity support or demonstrated
broad based access to the market for refinancing."

"MIG 2: This designation denotes high quality. Margins of protection are ample
although not as large as in the preceding group."

Money Market Funds -- Page 43

<TABLE>
The Cash Management Trust of America
Investment Portfolio, September 30, 1999
<S> <C> <C> <C>
Yield at Principal Market
Acquisition Amount Value
(000) (000)
-------- -------- --------

Certificates of Deposit - 0.85%
Canadian Imperial Bank of Commerce
5.35% November 19, 1999 5.35% $50,000 $ 50,000
----------
Total Certificates of Deposit 50,000
----------

Commercial Paper - 74.24%
Abbey National North America
November 8, 1999 5.35 50,000 49,713
American Express Credit Corp.
October 27, 1999 5.31 100,000 99,604
American General Finance Corp.
November 12, 1999 5.36 50,000 49,683
November 16, 1999 5.37 25,000 24,826
American Honda Finance Corp.
October 14, 1999 5.31 75,000 74,846
ANZ (Delaware) Inc.
October 18, 1999 5.31 75,000 74,802
Archer Daniels Midland Co.
October 5, 1999 5.29 35,000 34,975
Associates Corp. of North America
October 1, 1999 5.53 25,000 24,996
October 8, 1999 5.27 25,000 24,971
November 2, 1999 5.31 50,000 49,758
Atlantic Richfield Co.
November 1, 1999 (1) 5.34 25,000 24,882
Barclays U.S. Funding Corp.
October 18, 1999 5.31 50,000 49,869
Bayer Corp.
October 5, 1999 (1) 5.28 40,000 39,971
BellSouth Capital Funding Corp.
October 18, 1999 (1) 5.28 35,000 34,908
November 16, 1999 (1) 5.33 25,000 24,828
November 17, 1999 (1) 5.33 40,000 39,718
BMW U.S. Capital Corp.
October 7, 1999 5.29 40,000 39,960
October 28, 1999 5.32 35,000 34,857
Campbell Soup Co.
November 15, 1999 5.33 35,000 34,764
CBA (Delaware) Finance Inc.
October 5, 1999 5.25 25,000 24,982
October 13, 1999 5.33 25,000 24,956
Chevron USA Inc.
October 12, 1999 (1) 5.34 35,000 34,939
November 18, 1999 (1) 5.37 15,000 14,891
Ciesco LP
October 12, 1999 5.34 50,000 49,912
CIT Group, Inc.
October 8, 1999 5.26 30,000 29,965
October 26, 1999 5.30 20,000 19,924
November 22, 1999 5.37 25,000 24,804
Coca-Cola Co.
October 18, 1999 5.25 50,000 49,870
October 26, 1999 5.30 25,000 24,905
November 22, 1999 5.32 35,000 34,728
Colgate-Palmolive Co.
October 20, 1999 (1) 5.30 75,000 74,780
Duke Energy Corp.
October 1, 1999 5.50 20,000 19,997
October 12, 1999 5.25 30,000 29,948
Eastman Kodak Co.
October 6, 1999 5.24 25,000 24,978
November 10, 1999 5.34 20,000 19,879
November 17, 1999 5.35 20,000 19,859
November 18, 1999 5.34 35,000 34,748
E.I. du Pont de Nemours and Co.
October 5, 1999 5.28 20,000 19,986
October 6, 1999 5.23 25,000 24,978
November 12, 1999 5.31 30,000 29,811
Electronic Data Systems Corp.
October 06, 1999 (1) 5.30 25,000 24,978
October 25, 1999 (1) 5.31 25,000 24,909
Emerson Electric Co.
October 21, 1999 5.82 50,000 49,846
Ford Motor Credit Co.
October 7, 1999 5.26 25,000 24,975
October 26, 1999 5.31 25,000 24,904
November 17, 1999 5.33 50,000 49,648
Fortune Brands Inc.
October 8, 1999 (1) 5.28 10,000 9,988
October 15, 1999 (1) 5.31 50,000 49,890
France Telecom SA
October 1, 1999 5.21 9,192 9,191
October 6, 1999 5.28 25,000 24,978
November 2, 1999 5.34 38,000 37,814
Gannett Co.
October 6, 1999 (1) 5.29 25,000 24,978
October 22, 1999 5.30 50,000 49,839
General Electric Capital Corp.
October 29, 1999 5.35 50,000 49,786
November 16, 1999 5.37 50,000 49,653
General Motors Acceptance Corp.
October 1, 1999 5.24 25,000 24,996
October 26, 1999 5.31 75,000 74,712
Gillette Co.
October 7, 1999 (1) 5.19 25,000 24,975
November 4, 1999 (1) 5.35 25,000 24,871
Glaxo Wellcome PLC
October 4, 1999 (1) 5.24 15,000 14,991
October 12, 1999 (1) 5.31 15,000 14,974
October 20, 1999 (1) 5.31 30,000 29,912
Halifax PLC
October 4, 1999 5.20 25,000 24,986
November 8, 1999 5.34 50,000 49,713
Halliburton Co.
November 5, 1999 5.34 25,000 24,868
November 8, 1999 5.31 45,000 44,743
Hewlett-Packard Co.
October 12, 1999 5.30 50,000 49,912
H.J. Heinz Co.
October 19, 1999 5.30 50,000 49,861
October 20, 1999 5.31 20,000 19,941
October 21, 1999 5.30 25,000 24,923
Household Finance Corp.
October 8, 1999 5.26 30,000 29,965
October 13, 1999 5.31 50,000 49,905
IBM Credit Corp.
October 1, 1999 5.29 50,000 49,993
October 28, 1999 5.33 50,000 49,794
International Lease Finance Corp.
October 1, 1999 5.29 50,000 49,993
Internationale Nederlanden (U.S.) Funding Corp.
October 14, 1999 5.30 50,000 49,898
Johnson & Johnson
October 12, 1999 (1) 5.25 50,000 49,913
KfW International Finance Inc.
October 6, 1999 5.26 25,000 24,978
November 1, 1999 5.29 55,000 54,742
Kimberly-Clark Worldwide Inc.
October 13, 1999 (1) 5.32 50,000 49,905
Lucent Technologies Inc.
October 4, 1999 5.17 25,000 24,986
October 21, 1999 5.29 50,000 49,847
Minnesota Mining & Manufacturing Co.
October 20, 1999 5.30 25,000 24,927
Monsanto Co.
October 5, 1999 (1) 5.26 35,000 34,975
Motorola Credit Corp.
October 8, 1999 5.20 10,500 10,488
October 14, 1999 5.29 20,000 19,959
November 12, 1999 5.60 25,000 24,842
National Australia Funding (Delaware) Inc.
October 4, 1999 5.21 36,500 36,479
October 7, 1999 5.23 35,000 34,965
National Rural Utilities Cooperative
Finance Corp.
October 8, 1999 5.24 20,000 19,977
October 19, 1999 5.31 55,000 54,850
Pfizer Inc.
October 4, 1999 (1) 5.30 40,000 39,977
October 7, 1999 (1) 5.30 25,000 24,974
October 14, 1999 (1) 5.48 35,000 34,928
Pitney Bowes Credit Corp.
October 7, 1999 5.24 25,000 24,975
Procter & Gamble Co.
October 13, 1999 5.29 80,000 79,848
October 27, 1999 5.31 20,000 19,921
Reed Elsevier Inc.
October 28, 1999 (1) 5.31 50,000 49,795
Rio Tinto America Inc.
October 5, 1999 (1) 5.33 50,000 49,964
November 9, 1999 (1) 5.37 25,000 24,852
SBC Communications Inc.
November 18, 1999 (1) 5.32 50,000 49,641
Schering Corp.
October 7, 1999 5.31 50,000 49,949
Shell Finance (U.K.) PLC
October 6, 1999 5.25 15,000 14,987
October 29, 1999 5.32 25,000 24,894
November 4, 1999 5.42 35,000 34,820
November 22, 1999 5.34 25,000 24,805
Sony Capital Corp.
October 25, 1999 (1) 5.76 50,000 49,817
Svenska Handelsbanken Inc.
October 1, 1999 5.20 25,000 24,996
United Parcel Service of America, Inc.
October 4, 1999 5.31 50,000 49,971
Vodafone Airtouch PLC
October 19, 1999 (1) 5.34 25,000 24,930
October 25, 1999 (1) 5.37 25,000 24,908
Wal-Mart Stores, Inc.
October 18, 1999 (1) 5.31 25,000 24,934
October 25, 1999 (1) 5.30 30,000 29,890
November 1, 1999 (1) 5.32 45,000 44,795
Warner-Lambert Co.
November 10, 1999 (1) 5.33 50,000 49,699
Westpac Captial Corp.
November 9, 1999 5.38 50,000 49,706
Xerox Capital (Europe) PLC
October 4, 1999 5.20 50,000 49,971
October 6, 1999 5.22 10,000 9,991
October 22, 1999 5.30 40,000 39,871
Yale University
October 5, 1999 5.21 17,000 16,988
----------
Total Commercial Paper 4,302,704
----------

Federal Agency Discount Notes - 25.39%
Fannie Mae
October 1, 1999 5.10 6,000 5,999
October 7, 1999 5.18 25,000 24,975
October 25, 1999 5.28 25,000 24,909
November 1, 1999 5.30 65,500 65,194
November 2, 1999 5.30 50,000 49,759
November 3, 1999 5.28 100,000 99,505
November 4, 1999 5.30 25,000 24,872
November 5, 1999 5.30 40,000 39,790
November 9, 1999 5.21 100,000 99,435
November 23, 1999 5.24 80,000 79,378
Federal Home Loan Bank
October 8, 1999 5.15 156,200 156,023
October 15, 1999 5.22 100,000 99,785
October 22, 1999 5.24 59,205 59,017
November 5, 1999 5.29 65,000 64,659
November 12, 1999 5.20 25,000 24,849
November 19, 1999 5.27 45,000 44,674
Freddie Mac
October 7, 1999 5.20 25,000 24,975
October 8, 1999 5.15 103,000 102,883
October 14, 1999 5.20 55,000 54,890
October 15, 1999 5.22 45,000 44,903
October 21, 1999 5.25 25,000 24,924
November 4, 1999 5.23 60,000 59,694
November 9, 1999 5.29 75,000 74,563
November 10, 1999 5.29 50,000 49,701
November 15, 1999 5.24 65,000 64,564
November 18, 1999 5.27 25,000 24,822
----------
Total Federal Agency Discount Notes 1,488,742
----------
OTHER - 0.85%
Canada BHS
October 13, 1999 5.25 50,000 49,906
----------

Total Investment Securities 5,891,352
( cost: $5,891,320,000 )
Excess of payables over cash and receivables (28,302)
----------
Net Assets $5,863,050
============

(1) Restricted securities that can be resold
only to institutional investors. In practice,
these securities are as liquid as unrestricted
securities in the portfolio.

See Notes to the Financial Statements

</TABLE>

<TABLE>
Cash Management Trust of America
Financial Statements
<S> <C> <C>
- ---------------------------------------- ------------ ------------
Statement of Assets and Liabilities
at September 30, 1999 (dollars in thousands)
- ---------------------------------------- ------------ -----------
Assets:
Investment securities at market
(cost: $5,891,320) $5,891,352
Cash 1,293
Receivables for--
Sales of fund's shares $50,805
Accrued interest 71 50,876
------------ -----------
5,943,521
Liabilities:
Payables for--
Purchases of investments 0
Repurchases of fund's shares 77,839
Dividends payable 1,066
Management services 1,338
Accrued expenses 228 80,471
------------ -----------
Net Assets at September 30, 1999 -
Equivalent to $1.00 per share on
5,863,017,250 shares of beneficial
interest issued and outstanding;
unlimited shares authorized $5,863,050
===========

Statement of Operations
for the year ended, September 30,1999 (dollars in thousands)
------------ -----------
Investment Income:
Income:
Interest $ 261,262

Expenses:
Management services fee $14,593
Distribution expenses 4,353
Transfer agent fee 6,887
Reports to shareholders 259
Registration statement and prospectus 806
Postage, stationery and supplies 1,972
Trustees' fees 23
Auditing and legal fees 46
Custodian fee 456
Taxes other than federal income tax 52
Other expenses 160 29,607
------------ -----------
Net investment income 231,655
-----------
Increase in Unrealized Appreciation
on Investments:
Net realized gain 0
Net unrealized appreciation
on investments:
Beginning of year 16
End of year 32
------------
Net increase in unrealized appreciation
on investments 16
------------
Net Increase in Net Assets
Resulting from Operations $231,671
============

Statement of Changes in Net Assets (dollars in thousands)
- ---------------------------------------- ------------ -----------
Year ended September 30

1999 1998
Operations: ------------ -----------
Net investment income $ 231,655 $ 193,772
Net change in unrealized appreciation
on investments 16 (3)
------------ -----------
Net increase in net assets
resulting from operations 231,671 193,769
------------ -----------
Dividends Paid to Shareholders (231,656) (193,772)
------------ -----------
Capital Share Transactions:
Proceeds from shares sold:
14,382,799,048 and 12,930,964,595
shares, respectively 14,382,799 12,930,965
Proceeds from shares issued in
reinvestment of net investment income
dividends:
215,272,362 and 177,120,323 shares,
respectively 215,273 177,120
Cost of shares repurchased:
13,338,941,818 and 12,030,835,086
shares, respectively (13,338,942) (12,030,835)
------------ -----------
Net increase in net assets resulting
from capital share transactions 1,259,130 1,077,250
------------ -----------
Total Increase in Net Assets 1,259,145 1,077,247

Net Assets:
Beginning of year 4,603,905 3,526,658
------------ -----------
End of year $5,863,050 $4,603,905
============= =============

See Notes to Financial Statements

</TABLE>

Notes to Financial Statements

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION - The Cash Management Trust of America (the "fund") is registered
under the Investment Company Act of 1940 as an open-end, diversified management
investment company. The fund seeks to provide income on cash reserves, while
preserving capital and maintaining liquidity, through investments in
high-quality short-term money market instruments.

SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared
in conformity with generally accepted accounting principles which require
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates. The following is a summary of the significant accounting
policies consistently followed by the fund in the preparation of its financial
statements:

NET ASSET VALUE - The fund uses the penny-rounding method of valuing its
shares, in accordance with Securities and Exchange Commission (SEC) rules.
This method permits the fund to maintain a constant net asset value of $1.00
per share, provided the market value of the fund's shares does not deviate from
$1.00 by more than one-half of 1% and the fund complies with other restrictions
set forth in the SEC rules.

SECURITY VALUATION - Fixed-income securities are valued at prices obtained from
a pricing service, when such prices are available; however, in circumstances
where the investment adviser deems it appropriate to do so, such securities
will be valued at the mean quoted bid and asked prices or at prices for
securities of comparable maturity, quality and type. The ability of the issuers
of the debt securities held by the fund to meet their obligations may be
affected by economic developments in a specific industry, state or region.
Short-term securities maturing within 60 days are valued at amortized cost,
which approximates market value. Securities and assets for which
representative market quotations are not readily available are valued at fair
value as determined in good faith by a committee appointed by the Board of
Trustees.

SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions are
accounted for as of the trade date. Interest income is recognized on an accrual
basis. Market discounts, premiums, and original issue discounts on securities
purchased are amortized daily over the expected life of the security.
DIVIDENDS TO SHAREHOLDERS - Dividends to shareholders are declared daily after
the determination of the fund's net investment income and are paid to
shareholders monthly.

2. FEDERAL INCOME TAXATION
The fund complies with the requirements of the Internal Revenue Code applicable
to regulated investment companies and intends to distribute all of its net
taxable income for the fiscal year. As a regulated investment company, the
fund is not subject to income taxes if such distributions are made. Required
distributions are determined on a tax basis and may differ from net investment
income for financial reporting purposes. In addition, the fiscal year in which
amounts are distributed may differ from the year in which the net investment
income is recorded by the fund.

As of September 30, 1999, net unrealized appreciation on investments for
book and federal income tax purposes aggregated $32,000, of which $33,000
related to appreciated securities and $1,000 related to depreciated securities.
The cost of portfolio securities for book and federal income tax purposes was
$5,891,320,000 at September 30, 1999.

3. FEES AND TRANSACTIONS WITH RELATED PARTIES

INVESTMENT ADVISORY FEE - The fee of $14,593,000 for management services was
incurred pursuant to an agreement with Capital Research and Management Company
(CRMC), with which certain officers and Trustees of the fund are affiliated.
The Investment Advisory and Service Agreement provides for monthly fees,
accrued daily, based on an annual rate of 0.32% of the first $1 billion of
average net assets; 0.29% of such assets in excess of $1 billion but not
exceeding $2 billion; and 0.27% of such assets in excess of $2 billion.

DISTRIBUTION EXPENSES - Pursuant to a Plan of Distribution with American Funds
Distributors, Inc. (AFD), the fund may expend up to 0.15% of its average net
assets annually for any activities primarily intended to result in sales of
fund shares, provided the categories of expenses for which reimbursement is
made are approved by the fund's Board of Trustees. Fund expenses under the Plan
include payments to dealers to compensate them for their selling and servicing
efforts. During the year ended September 30, 1999, distribution expenses under
the Plan were $4,353,000. As of September 30, 1999, accrued and unpaid
distribution expenses were $342,000.

TRANSFER AGENT FEE - American Funds Service Company (AFS), the transfer agent
for the fund, was paid a fee of $6,887,000.

DEFERRED TRUSTEES' FEES - Trustees who are unaffiliated with CRMC may elect to
defer part or all of the fees earned for services as members of the Board.
Amounts deferred are not funded and are general unsecured liabilities of the
fund. As of Septmeber 30, 1999, aggregate deferred amounts and earnings thereon
since the deferred compensation plan's adoption (1993), net of any payments to
Trustees, were $26,000.

CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both wholly
owned subsidiaries of CRMC. Certain Trustees and officers of the fund are or
may be considered to be affiliated with CRMC, AFS and AFD. No such persons
received any remuneration directly from the fund.

4. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES

The fund made purchases and sales of investment securities, including
maturities, of $49,109,036,000 and $48,100,307,000, respectively, during the
year ended September 30, 1999.

Net Asset Value, Beginning of Year $1.00 $1.00 $1.00
------------ ------------ ----------
Income From Investment Operations:
Net investment income .045 .050 .049
------------ ------------ ----------
Total from investment operations .045 .050 .049
----------- ----------- ---------
Less Distributions:
Dividends (from net investment income) (.045) (.050) (.049)
----------- ----------- ---------
Total distributions (.045) (.050) (.049)
----------- ----------- ---------
Net Asset Value, End of Year $1.00 $1.00 $1.00
========== ========== ========

Total Return 4.59% 5.15% 5.03%

Ratios/Supplemental Data:
Net assets, end of year (in millions) $5,863 $4,604 $3,527
Ratio of expenses to average net assets .58% .58% .57%
Ratio of net income to average net assets 4.52% 5.02% 4.93%

Per-Share Data and Ratios ---------- ---------

1996 1995

Net Asset Value, Beginning of Year $1.00 $1.00
---------- ---------
Income From Investment Operations:
Net investment income .050 .052
---------- ---------
Total from investment operations .050 .052
----------- ---------
Less Distributions:
Dividends (from net investment income) (.050) (.052)
----------- ---------
Total distributions (.050) (.052)
---------- ---------
Net Asset Value, End of Year $1.00 $1.00
======== =======

Total Return 5.06% 5.34%

Ratios/Supplemental Data:
Net assets, end of year (in millions) $3,304 $2,996
Ratio of expenses to average net assets .60% .60%
Ratio of net income to average net assets 4.95% 5.21%

</TABLE>

Report of Independent Accountants

To the Board of Trustees and Shareholders of The Cash Management Trust of
America:

In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, and the related statements of operations and of
changes in net assets and the per-share data and ratios present fairly, in all
material respects, the financial position of The Cash Management Trust of
America(the "Fund") at September 30, 1999, the results of its operations, the
changes in its net assets and the per-share data and ratios for the years
indicated, in conformity with generally accepted accounting principles. These
financial statements and per-share data and ratios (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at September 30, 1999 by correspondence with the custodian, provide
a reasonable basis for the opinion expressed above.

/s/PricewaterhouseCoopers LLP
Los Angeles, California
October 29, 1999

1999 Tax Information (unaudited)

We are required to advise you within 60 days of the fund's fiscal year-end
regarding the federal tax status of distributions received by shareholders
during such fiscal year.

Certain states may exempt from income taxation that portion of the dividends
paid from net investment income that was derived from direct U.S. Treasury
obligations. For purposes of computing this exclusion, none of the dividends
paid by the fund from net investment income were derived from interest on
direct U.S. Treasury obligations.

Dividends received by retirement plans such as IRAs, Keogh-type plans and
403(b) plans need not be reported as taxable income. However, many retirement
plan trusts may need this information for their annual information reporting.

SINCE THE AMOUNTS ABOVE ARE REPORTED FOR THE FUND'S FISCAL YEAR AND NOT THE
CALENDAR YEAR, SHAREHOLDERS SHOULD REFER TO THEIR FORM 1099-DIV OR OTHER TAX
INFORMATION WHICH WILL BE MAILED IN JANUARY 2000 TO DETERMINE THE CALENDAR YEAR
AMOUNTS TO BE INCLUDED ON THEIR 1999 TAX RETURNS. SHAREHOLDERS SHOULD CONSULT
THEIR TAX ADVISERS.
<TABLE>
The U.S. Treasury Money Fund of America
Investment Portfolio
September 30, 1999
<S> <C> <C> <C>
Principal Market
Yield at Amount Value
Acquisition (000) (000)
------------- ------- -------------
U.S. Treasury Securities - 99.99%

U.S. Treasury bills 10/7/99 4.64% - 4.74% $58,790 $58,740
U.S. Treasury bills 10/14/99 4.57% - 4.80% 40,960 40,888
U.S. Treasury bills 10/21/99 4.52% - 4.77% 29,470 29,395
U.S. Treasury bills 10/28/99 4.60% - 4.73% 55,720 55,525
U.S. Treasury bills 11/4/99 4.59% - 4.82% 56,790 56,556
U.S. Treasury bills 11/12/99 4.60% - 4.92% 38,645 38,396
U.S. Treasury bills 11/18/99 4.75% - 4.86% 55,130 54,807
U.S. Treasury bills 11/26/99 4.91% 44,300 44,002
U.S. Treasury bills 12/2/99 4.70% - 4.92% 43,980 43,632
U.S. Treasury bills 12/9/99 4.67% - 4.90% 43,100 42,721
U.S. Treasury bills 12/23/99 4.77% - 4.78% 2,000 1,978

-------------
Total Investment Securities
(cost: $466,561,000) 466,640

Excess of cash and receivables 55
over payables -------------

Net Assets $466,695
=============

See Notes to Financial Statements

</TABLE>

<TABLE>
The U.S. Treasury Money Fund of America
Financial Statements
<S> <C> <C>
- ---------------------------------------- ------------ ------------
Statement of Assets and Liabilities
at September 30, 1999 (dollars in thousands)
- ---------------------------------------- ------------ ------------
Assets:
Investment securities at market
(cost: $466,561) $466,640
Cash 437
Receivables for --
Sales of fund's shares 2,002
------------
469,079
Liabilities:
Payables for --
Repurchases of fund's shares $2,157
Dividends payable 67
Management services 114
Accrued expenses 46 2,384
------------ ------------
Net Assets at September 30, 1999 --
Equivalent to $1.00 per share on
466,616,074 shares of beneficial
interest issued and outstanding;
unlimited shares authorized $466,695
=============

Statement of Operations
for the year ended September 30, 1999 (dollars in thousands)
------------ ------------
Investment Income:
Income:
Interest $ 19,153

Expenses:
Management services fee $1,272
Distribution expenses 438
Transfer agent fee 411
Reports to shareholders 24
Registration statement and prospectus 138
Postage, stationery and supplies 108
Trustees' fees 16
Auditing and legal fees 31
Custodian fee 38
Taxes other than federal income tax 4
Other expenses 9 2,489
------------ ------------
Net investment income 16,664
------------
Change in Unrealized Appreciation
on Investments:
Net unrealized
appreciation on investments:
Beginning of year 219
End of year 79
------------
Net change in unrealized appreciation
on investments (140)
------------
Net Increase in Net Assets Resulting
from Operations $16,524
============
Statement of Changes in Net
Assets (dollars in thousands)
- ---------------------------------------- --------------------------
Year ended September 30

1999 1998
Operations: --------------------------
Net investment income 16,664 $13,215
Net change in unrealized appreciation
on investments (140) 141
--------------------------
Net increase in net assets
resulting from operations 16,524 13,356
--------------------------
Dividends Paid to Shareholders (16,664) (13,215)
--------------------------
Capital Share Transactions:
Proceeds from shares sold:
774,656,722 and 660,343,206
shares, respectively 774,656 660,344
Proceeds from shares issued in
reinvestment of net investment income
dividends: 15,676,872 and
12,201,748 shares, respectively 15,677 12,201
Cost of shares repurchased:
679,107,911 and 596,431,556
shares, respectively (679,108) (596,431)
--------------------------
Net increase in net assets resulting
from capital share transactions 111,225 76,114
--------------------------
Total Increase in Net Assets 111,085 76,255

Net Assets:
Beginning of year 355,610 279,355
--------------------------
End of year $466,695 $355,610
==========================

See Notes to Financial Statements

</TABLE>

Notes to Financial Statements

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION - The U.S. Treasury Money Fund of America (the "fund") is
registered under the Investment Company Act of 1940 as an open-end, diversified
management investment company. The fund seeks to provide income on cash
reserves, while preserving capital and maintaining liquidity, through
investments in U.S. Treasury securities maturing in one year or less.

SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been
prepared in conformity with generally accepted accounting principles which
require management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could
differ from those estimates. The following is a summary of the significant
accounting policies consistently followed by the fund in the preparation of its
financial statements:

SECURITY VALUATION - Fixed-income securities are valued at prices obtained
from a pricing service, when such prices are available; however, in
circumstances where the investment adviser deems it appropriate to do so, such
securities will be valued at the mean quoted bid and asked prices or at prices
for securities of comparable maturity, quality and type. Short-term securities
maturing within 60 days are valued at amortized cost, which approximates market
value. Securities and assets for which representative market quotations are not
readily available are valued at fair value as determined in good faith by a
committee appointed by the Board of Trustees.

SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME <UNDEF> Security
transactions are accounted for as of the trade date. Interest income is
recognized on an accrual basis. Market discounts, premiums, and original issue
discounts on securities purchased are amortized daily over the expected life of
the security.

DIVIDENDS TO SHAREHOLDERS - Dividends to shareholders are declared daily
after the determination of the fund's net investment income and are paid to
shareholders monthly.

2. FEDERAL INCOME TAXATION

The fund complies with the requirements of the Internal Revenue Code
applicable to regulated investment companies and intends to distribute all of
its net taxable income for the fiscal year. As a regulated investment company,
the fund is not subject to income taxes if such distributions are made.
Required distributions are determined on a tax basis and may differ from net
investment income for financial reporting purposes. In addition, the fiscal
year in which amounts are distributed may differ from the year in which the net
investment income is recorded by the fund.

As of September 30, 1999, net unrealized appreciation on investments for
book and federal income tax purposes aggregated $79,000, of which $115,000
related to appreciated securities and $36,000 related to depreciated
securities. The cost of portfolio securities for book and federal income tax
purposes was $466,561,000 at September 30, 1999.

3. FEES AND TRANSACTIONS WITH RELATED PARTIES

INVESTMENT ADVISORY FEE - The fee of $1,272,000 for management services
was incurred pursuant to an agreement with Capital Research and Management
Company (CRMC) with which certain officers and Trustees of the fund are
affiliated. The Investment Advisory and Service Agreement provides for monthly
fees, accrued daily, based on an annual rate of 0.30% of the first $800 million
of average net assets and 0.285% of such assets in excess of $800 million.

DISTRIBUTION EXPENSES - Pursuant to a Plan of Distribution with American
Funds Distributors, Inc. (AFD), the fund may expend up to 0.15% of its average
net assets annually for any activities primarily intended to result in sales of
fund shares, provided the categories of expenses for which reimbursement is
made are approved by the fund's Board of Trustees. Fund expenses under the Plan
include payments to dealers to compensate them for their selling and servicing
efforts. During the year ended September 30, 1999, distribution expenses under
the Plan were $438,000. As of September 30, 1999, accrued and unpaid
distribution expenses were $38,000.

TRANSFER AGENT FEE - American Funds Service Company (AFS), the transfer
agent for the fund, was paid a fee of $411,000.

DEFERRED TRUSTEES' FEES - Trustees who are unaffiliated with CRMC may
elect to defer part or all of the fees earned for services as members of the
Board. Amounts deferred are not funded and are general unsecured liabilities of
the fund. As of September 30, 1999, aggregate deferred amounts and earnings
thereon since the deferred compensation plan's adoption (1993), net of any
payments to Trustees, were $12,000.

CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both
wholly owned subsidiaries of CRMC. Certain Trustees and officers of the fund
are or may be considered to be affiliated with CRMC, AFS and AFD. No such
persons received any remuneration directly from the fund.

4. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES

The fund made purchases and sales of investment securities, including
maturities, of $2,078,933,000 and $1,986,103,000, respectively, during the year
ended September 30, 1999.

Pursuant to the custodian agreement, the fund receives credits against its
custodian fee for imputed interest on certain balances with the custodian bank.
The custodian fee of $38,000 includes $19,000 that was paid by these credits
rather than in cash.
<TABLE>
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA AND RATIOS
- ------------------------------ --------------------------------------
Year endSeptembe 30
--------------------------------------
1999 1998 1997 1996 1995
--------------------------------------
Net Asset Value, Beginning
of Year $1.00 $1.00 $1.00 $1.00 $1.00
--------------------------------------

Income from Investment
Operations:
Net investment income .039 .045 .046 .046 .048
Total from investment --------------------------------------
operations .039 .045 .046 .046 .048
--------------------------------------
Less Distributions:
Dividends (from net investment
income) (.039) (.045) (.046) (.046) (.048)
--------------------------------------
Total distributions (.039) (.045) (.046) (.046) (.048)
--------------------------------------
Net Asset Value, End of Year $1.00 $1.00 $1.00 $1.00 $1.00
======================================
Total Return 4.00% 4.63% 4.71% 4.66% 4.89%

Ratios/Supplemental Data:
Net assets, end of year (in
millions) $467 $356 $279 $256 $231
Ratio of expenses to average
net assets .59% .59% .53% .65% .67%
Ratio of net income to
average net assets 3.95% 4.49% 4.61% 4.53% 4.79%

</TABLE>

Report of Independent Accountants

To the Board of Trustees and Shareholders of The U.S. Treasury Money Fund of
America:

In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, and the related statements of operations and of
changes in net assets and the per-share data and ratios present fairly, in all
material respects, the financial position of The U.S. Treasury Money Fund of
America(the "Fund") at September 30, 1999, the results of its operations, the
changes in its net assets and the per-share data and ratios for the years
indicated, in conformity with generally accepted accounting principles. These
financial statements and per-share data and ratios (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at September 30, 1999 by correspondence with the custodian, provide
a reasonable basis for the opinion expressed above.

/s/PricewaterhouseCoopers LLP
Los Angeles, California
October 29, 1999

1999 Tax Information (unaudited)

We are required to advise you within 60 days of the fund's fiscal year-end
regarding the federal tax status of distributions received by shareholders
during such fiscal year.

Certain states may exempt from income taxation that portion of the dividends
paid from net investment income that was derived from direct U.S. Treasury
obligations. For purposes of computing this exclusion, all of the dividends
paid by the fund from net investment income were derived from interest on
direct U.S. Treasury obligations.

SINCE THE AMOUNTS ABOVE ARE REPORTED FOR THE FUND'S FISCAL YEAR AND NOT THE
CALENDAR YEAR, SHAREHOLDERS SHOULD REFER TO THEIR FORM 1099-DIV OR OTHER TAX
INFORMATION WHICH WILL BE MAILED IN JANUARY 2000 TO DETERMINE THE CALENDAR YEAR
AMOUNTS TO BE INCLUDED ON THEIR 1999 TAX RETURNS. SHAREHOLDERS SHOULD CONSULT
THEIR TAX ADVISERS.
<TABLE>
THE TAX-EXEMPT MONEY FUND OF AMERICA
Investment Portfolio
September 30, 1999
<S> <C> <C> <C>
Principa Market
Yield at Amount Value
Municipal Securities Acquisiti (000) (000)

Alabama - 1.17%
Town of Chatom, Industrial Development Board,
Pollution Control
Revenue Refunding Bonds (Alabama Electric
Cooperative, Inc.
Project), Pooled Series 1993, TECP:
3.40% 11/2/99 3.40% $1,400 $1,400
3.60% 11/2/99 3.60 1,600 1,600

Alaska - 4.15%
City of Valdez, Marine Terminal Revenue Refunding
Bonds
(ARCO Transportation Alaska, Inc. Project),TECP:
1994 Series A,
3.35% 10/12/99 3.35 1,500 1,500
3.45% 11/08/99 3.45 2,200 2,200
3.55% 11/08/99 3.55 1,700 1,700
3.55% 11/12/99 3.55 1,500 1,500
1994 Series C, 3.25% 10/06/99 3.25 2,000 2,000
City of Valdez, Variable Rate Marine Terminal
Revenue Refunding
Bonds (Mobil Alaska Pipeline Co. Project),
1993 Series A,
3.77% 10/6/99* 3.77 1,700 1,700

Arizona - 3.95%
Salt River Project Agricultural Improvement and
Power District,
Promissory Notes, TECP:
Series B:
3.30% 10/18/99 3.30 1,000 1,000
3.35% 10/26/99 3.35 2,100 2,100
Series G, 3.45% 11/09/99 3.45 2,000 2,000
Series L:
3.40% 11/03/99 3.40 2,000 2,000
3.50% 11/05/99 3.50 2,000 2,000
County of Apache, Industustrial Development
Revenue Bonds,(Tuscon Electric Power Co.
Springerville Project), 1983 Series B, 3.85%
10/6/99* 3.85 1,000 1,000

Connecticut - 1.06%
Health and Educational Facilities Authority, Revenue
Bonds, Yale University Issue, Series T, 3.70%, 10/7/99* 3.70 2,700 2,700

Florida - 5.91%
Florida Municipal Power Agency Initial Pooled
Loan Project
Commercial Paper Notes, Series A, TECP:
3.35% 10/07/99 3.35 3,000 3,000
3.55% 10/14/99 3.55 1,990 1,990
3.35% 10/19/99 3.35 1,400 1,400
Jacksonville Electric Authority Electric System,TECP:
Series A, TECP:
3.15% 10/06/99 3.15 1,500 1,500
3.45% 10/13/99 3.45 2,000 2,000
Series C-1:
3.35% 10/05/99 3.35 2,000 2,000
3.35% 10/06/99 3.35 2,000 2,000
3.50% 11/03/99 3.50 1,200 1,200

Idaho - 0.59%
Tax Anticipation Notes, Series 1999, 4.25% 6/30/00 3.42 1,500 1,507

Indiana - 2.39%
City of Fort Wayne, Hospital Authority, Variable
Rate Demand Bonds (Parkview Memorial
Hospital,Inc. Project), Series 1989B, 3.80% 10/7/99* 3.80 1,600 1,600
City of Sullivan, Pollution Control Revenue Bonds
(Hoosier Energy Rural Electric Cooperative, Inc.
Project), Series 1985L-4, TECP:
3.65% 10/26/99 3.65 2,000 2,000
3.65% 11/16/99 3.65 2,500 2,500

Iowa - 1.18%
Iowa School Cash Anticipation Program, Iowa
School Corporations, Warrant Certificates,
1998-99 Series A, FSA Insured, 4.00% 6/23/00 3.44 3,000 3,006

Kentucky - 2.13%
Asset/Liability Commission General Fund Tax
and Revenue Anticipation Notes, 1999 Series A,
4.25% 6/28/00 3.54 2,400 2,411
Pendleton County, Multi-County Lease Revenue Bonds
(Kentucky Association of Counties Leasing Trust
Program), Series 1989, Money Market Municipal, TECP:
3.35% 10/7/99 3.35 1,785 1,785
3.40% 11/2/99 3.40 1,250 1,250

Louisiana - 0.43%
South Louisiana Port Commission, Port Facility
Revenue Bonds (Holman Inc. Project), Series
1997, AMT, 3.85% 10/6/99* 3.85 1,100 1,100

Maryland - 10.25%
Maryland Health and Higher Education Facilities
Authority, Pooled Loan Program Revenue Notes
(The Johns Hopkins Hospital), Series C, TECP:
3.15% 10/5/99 3.15 1,000 1,000
3.55% 11/15/99 3.55 2,200 2,200
Series D, 3.75% 10/7/99* 3.75 2,485 2,485
Anne Arundel County, Economic Development Revenue
Bonds (Baltimore Gas and Electric Co. Project):
Series 1985:
3.45% 10/6/99 3.45 1,000 1,000
3.50% 11/4/99 3.50 3,000 3,000
Series 1988, AMT:
3.30% 10/4/99 3.30 2,000 2,000
3.40% 10/12/99 3.40 1,500 1,500
3.35% 10/14/99 3.35 2,000 2,000
Montgomery County, Consolidated Commercial Paper
Bond Anticipation Notes, Series 1995, TECP:
3.25% 10/4/99 3.25 4,000 4,000
3.35% 10/15/99 3.35 3,000 3,000
3.45% 11/5/99 3.45 3,000 3,000
Washington Suburban Sanitary District (Montgomery
and Prince George's Counties), Sewage Disposal
Bonds, Series 1993, 5.00% 06/01/00 2.01 1,000 1,009

Massachusetts - 1.17%
"yield at acquisition" reflects current coupon rate.
Revenue Variable Rate Bonds (Lassell Village Project),
Series 1998C, 3.65% 10/6/99* 3.65 3,000 3,000

Michigan - 0.39%
Regents of the University of Michigan, Public Higher
Education Revenue Notes, Series B, TECP,
3.20% 10/20/99 3.20 1,000 1,000

Minnesota - 4.19%
City of Rochester, Health Care Facilities Revenue
Bonds (Mayo Foundation/Mayo Medical Center),
Adjustable Tender, TECP:
Series 1992A:
3.35% 10/18/99 3.35 2,400 2,400
3.30% 10/19/99 3.30 5,700 5,700
Series 1992C, 3.35% 10/20/99 3.35 2,600 2,600

Missouri - 1.41%
Higher Education Loan Authority, Adjustable Rate
Demand Student Loan Revenue Bonds, AMT*:
Series 1990A, 3.90% 10/6/99 3.90 1,600 1,600
Series 1990B, 3.90% 10/6/99 3.90 1,000 1,000
City of Columbia, Special Obligation Insurance
Reserve Bonds, Series 1988A, 3.70% 10/6/99* 3.70 1,000 1,000

New Jersey - 1.29%
Tax and Revenue Anticipation Notes, Series 2000A,
TECP, 3.50% 10/28/99 3.50 3,300 3,300

New York - 1.41%
State Housing Finance Agency, Revenue Bonds
(Saxony Housing), 1997 Series A, AMT 3.75% 10/6/99* 3.75 3,600 3,600

North Carolina - 4.35%
Eastern Municipal Power Agency, TECP, 3.45% 10/6/99 3.45 4,000 4,000
Educational Facilities Finance Agency, Revenue Bonds
(Duke University Project):
Series 1991D, 3.65% 10/7/99* 3.65 1,800 1,800
Series 1992A, 3.65% 10/7/99* 3.65 2,800 2,800
Board of Governors of the University of North Carolina
at Chapel Hill, Athletic Facilities Revenue Bonds,
Series 1998, 3.80% 10/7/99* 3.80 2,500 2,500

Ohio - 5.83%
Water Development Authority, Pollution Control
Revenue Bonds, Series 1988 (Duquesne Light Co.
Project), TECP, AMT, 3.45% 10/29/99 3.45 3,000 3,000
City of Cleveland, Income Tax Revenue Bonds,
3.80% 10/6/99* 3.80 4,500 4,500
County of Hamilton, Hospital Revenue Bonds
(Bethesda Hospital, Inc.), Series 1995, 3.65%
10/7/99* 3.65 2,100 2,100
Ohio State University, Revenue Bonds, Series
1998A, TECP:
3.30% 10/21/99 3.30 2,300 2,300
3.40% 10/25/99 3.40 3,000 3,000

Pennsylvania - 13.15%
Higher Education Assistance Agency Student
Loan Adjustable Rate Revenue Bonds, 1997
Series A, AMT, 3.95% 10/6/99* 3.95 2,000 2,000
Beaver County Industrial Development Authority,
Pollution Control Revenue Refunding Bonds
(Duquesne Light Co. Beaver Valley Project),
1990 Series C, TECP, 3.30% 10/22/99 3.30 3,000 3,000
Carbon County Industrial Development Authority,
Resource Recovery Revenue Bonds (Panther
Creek Partners Project), TECP,AMT:
Series 1990B, 3.40% 10/27/99 3.40 3,000 3,000
Series 1990B, 3.55% 11/12/99 3.55 2,500 2,500
Series 1992A, 3.20% 10/5/99 3.20 4,000 4,000
Delaware County Industrial Development Authority:
Pollution Control Revenue Refunding Bonds (Philadelphia
Electric Co.Project), 1998 Series A, FGIC Insured, TECP:
3.35% 10/7/99 3.35 4,600 4,600
3.35% 10/8/99 3.35 3,500 3,500
3.40% 10/8/99 3.40 2,000 2,000
Solid Waste Revenue Bonds (Scott Paper Co. Project),
Series 1984D, 3.80% 10/6/99* 3.80 1,000 1,000
Montgomery County Industrial Development Authority
Variable Rate Demand Commercial Development
Revenue Bonds (Valley ForgePlaza Associates -
Trasde Shoe Facilities Project),Series T, 3.80%
10/7/99* 3.80 4,000 4,000
Venango Industrial Development Authority,
Resource Recovery Revenue Bonds (Scrubgrass
Project), Series 1990A, TECP, AMT:
3.35% 10/14/99 3.35 2,500 2,500
3.60% 10/26/99 3.60 1,500 1,500

South Carolina - 2.13%
Public Service Authority (Santee Cooper Hydroelectric
Project), Series 1998, TECP, 3.55% 11/1/99 3.55 1,500 1,500
Lexington County Health Service District, Inc.,
Hospital Revenue Refunding and Improvement
Bonds, Series 1997, 4.75% 11/1/99 3.20 1,590 1,591
York County, Pollution Control Facilities Revenue
Refunding Bonds(Duke Power Company Project),
Series 1990, 3.40% 10/18/99 3.40 2,350 2,350

Tennessee - 3.29%
Montgomery County Public Building Authority,
Pooled Financing Revenue Bonds, Series 1997
(Tennessee County Loan Pool), 3.80% 10/7/99* 3.80 8,400 8,400

Texas - 14.33%
Tax and Revenue Anticipation Notes, Series 1999A, 3.72 6,700 6,750
4.50% 8/31/00 Board of Regents of the Texas A&M
University System, Permanent University Fund
Subordinate Lien Notes, Series B, TECP, 3.40%
10/20/1999 3.40 2,800 2,800
Board of Regents of the University of Texas System,
Revenue Financing System Commercial Paper Notes,
Series A, TECP, 3.40% 10/21/99 3.40 2,500 2,500
City of Austin (Travis and Williams Counties),
Combined Utility Systems Notes, Series A, TECP,
3.40% 10/28/99 3.40 1,900 1,900
Brazos Higher Education Authority Inc., Student Loan
Revenue Bonds, Series 1993B-1, AMT, 3.75% 10/6/99* 3.75 1,000 1,000
Brazos River Authority, Collateralized Pollution
Control Revenue Refunding Bonds (Texas Utilities
Electric Co, Project):
Series D, MBIA Insured, AMT, 3.90% 10/6/99* 3.90 3,000 3,000
Series 1994, TECP, AMT, 3.40 10/13/99 3.40 1,500 1,500
City of Brownsville Utility System, Series A, TECP,
3.30% 10/15/99 3.30 1,950 1,950
Harris County General Obligation Notes, Series A,
TECP:
3.45% 10/1/99 3.45 2,315 2,315
3.50% 10/25/99 3.50 1,700 1,700
City of Houston, General Obligation Commercial
Paper Notes, TECP, Series B, 3.25 10/1/99 3.25 2,000 2,000
City of Midlothian Industrial Development Corporation,
Variable Rate Demand Pollution Control Revenue Bonds
(Box-Crow Cement Company Project), 3.75% 10/6/99* 3.75 4,300 4,300
South Texas Higher Education Authority, Inc.,
Student Loan Revenue Bonds, Series 1997,
MBIA Insured, AMT, 3.80% 10/6/99* 3.80 4,900 4,900

Virginia - 4.38%
General Obligation Bond Anticipation Notes,
Series 1998, TECP, 3.20% 10/12/99 3.20 1,700 1,700
Peninsula Ports Authority, Coal Terminal Revenue
Refunding Bonds (Dominion Terminal Associates
Project), Series 1987-B, TECP, 3.30% 10/13/99 3.30 2,100 2,100
City of Hampton, Industrial Development Authority,
Hospital Facilities Revenue Bonds Sentara Health
System Obligated Group), Series 1997B, TECP,
3.55% 10-27-99 3.55 2,900 2,900
City of Norfolk, Industrial Development Authority,
Hospital Revenue Bonds (Sentara Hospitals -
Norfolk Project) Series 1990A, TECO, 3.55% 11/9/99 3.55 4,500 4,500

Washington - 2.67%
Port of Seattle:
Variable Rate General Obligation Bonds,
Series 1985, 3.77% 10/6/99* 3.77 3,000 3,000
Subordinate Lien Revenue Notes, Series A, TECP:
3.40% 10/1/99 3.40 2,310 2,310
2.80% 11/3/99 3.40 1,500 1,500

West Virginia - 0.63%
The County Commission of Marion County, Solid
Waste Disposal Facility Revenue Bonds, 1990
Series A (Grant Town Cogeneration Project),
AMT, 3.85% 10/6/99* 3.85 1,600 1,600

Wisconsin - 5.60%
General Obligation Bonds, Series 1998A, TECP, 3.55 2,631 2,631
3.55% 10/29/99 Health and Educational Facilities
Authority, Variable Rate Demand Revenue Bonds
(Felican Services, Inc. Obligated Group), Series
1997A, AMBAC Insured, 3.80 10/6/99* 3.80 5,000 5,000
Transportation Revenue Commercial Paper Notes
of 1997, Series A, TECP:
Series A, TECP:
3.35% 10/8/99 3.35 1,000 1,000
2.50% 11/4/99 3.50 2,305 2,305
3.5% 11/10/99 3.50 3,363 3,363

Wyoming - 1.02%
Tax and Revenue Anticipation Notes, Series 1999,
4.00% 6/27/00 3.30 1,600 1,603
Sweetwater County Pollution Control Revenue
Bonds (PacificCorp Projects), Series 1988A,
TECP, 3.40% 10/4/99 3.40 1,000 1,000
----------
Total Tax-Exempt Securities (cost: $256,624,000)
Excess of payables over cash and receivables 256,611
(1,171)
----------
255,440
NET ASSETS ======

* Coupon rate may change periodically;
"yield at acquisition" reflects current coupon rate.

</TABLE>

<TABLE>
The Tax-Exempt Money Fund of America
Financial Statements
<S> <C> <C>
- --------------------------------- ------------ ------------
Statement of Assets and Liabilities (dollars in
at September 30, 1999 thousands)
- --------------------------------- ------------ ------------
Assets:
Investment securities at market
(cost: $256,624) $256,611
Cash 248
Receivables for--
Sales of fund's shares $648
Accrued interest 906 1,554
------------ ------------
258,413
Liabilities:
Payables for--
Purchases of investments 1,011
Repurchases of fund's shares 1,826
Dividends payable 31
Management services 86
Accrued expenses 19 2,973
------------ ------------
Net Assets at
September 30, 1999 --
Equivalent to $1.00 per share on
255,515,417 shares of beneficial
interest issued and outstanding;
unlimited shares authorized $255,440
=============
Statement of Operations
for the year ended September 30, 1999 (dollars in thousands)
------------ ------------
Investment Income:
Income:
Interest $7,148
Expenses:
Management services fee $1,003
Distribution expenses 109
Transfer agent fee 153
Reports to shareholders 15
Registration statement
and prospectus 82
Postage, stationery
and supplies 54
Trustees' fees 15
Auditing and legal fees 34
Custodian fee 63
Taxes other than federal income tax 3
Other expenses 14
------------
Total expenses before
reimbursement 1,545
Reimbursement of expenses 56 1,489
------------ ------------
Net investment income 5,659
------------
Change in Unrealized Appreciation
(Depreciation) on Investments:
Net unrealized appreciation
(Depreciation) on investments:
Beginning of year 46
End of year (13)
------------
Net change in unrealized
appreciation (depreciation)
on investments (59)
------------
Net Increase in Net Assets
Resulting from Operations $5,600
============

Statement of Changes in Net Assets
(dollars in thousands)
- --------------------------------- ------------- -------------
Year ended September 30

1999 1998
Operations: ------------- -------------
Net investment income $5,659 $5,296
Net change in unrealized
appreciation (depreciation)
on investments (59) 37
------------- -------------
Net increase in net
assets resulting
from operations 5,600 5,333
------------- -------------
Dividends Paid to Shareholders (5,698) (5,316)
------------- -------------
Capital Share Transactions:
Proceeds from shares sold:
475,331,901 and 373,325,429
373,325,429 shares,
respectively 475,332 373,325
Proceeds from shares issued
in reinvestment of net
investment income
dividends 5,248,578
and 4,856,600 shares,
respectively 5,249 4,857
Cost of shares repurchased:
423,236,513 and
339,912,546 shares
respectively (423,237) (339,912)
------------- -------------
Net increase in net assets
resulting from capital
share transactions 57,344 38,270
------------- -------------
Total Increase in Net Assets 57,246 38,287

Net Assets:
Beginning of year 198,194 159,907
------------- -------------

End of year $255,440 $198,194
============= ==============

See Notes to Financial Statements

</TABLE>

Notes to Financial Statements

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION - The Tax-Exempt Money Fund of America (the "fund") is
registered under the Investment Company Act of 1940 as an open-end, diversified
management investment company. The fund seeks to provide income free from
federal taxes, while preserving capital and maintaining liquidity, through
investments in high-quality municipal securities with effective maturities of
one year or less.

SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been
prepared in conformity with generally accepted accounting principles which
require management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could
differ from those estimates. The following is a summary of the significant
accounting policies consistently followed by the fund in the preparation of its
financial statements:

SECURITY VALUATION - Fixed-income securities are valued at prices obtained
from a pricing service, when such prices are available; however, in
circumstances where the investment adviser deems it appropriate to do so, such
securities will be valued at the mean quoted bid and asked prices or at prices
for securities of comparable maturity, quality and type. The ability of the
issuers of the debt securities held by the fund to meet their obligations may
be affected by economic developments in a specific industry, state or region.
Short-term securities maturing within 60 days are valued at amortized cost,
which approximates market value. Securities and assets for which representative
market quotations are not readily available are valued at fair value as
determined in good faith by a committee appointed by the Board of Trustees.

DIVIDENDS TO SHAREHOLDERS - Dividends to shareholders are declared daily
after the determination of the fund's net investment income and are paid to
shareholders monthly.

2. FEDERAL INCOME TAXATION

The fund complies with the requirements of the Internal Revenue Code applicable
to regulated investment companies and intends to distribute all of its net
taxable income for the fiscal year. As a regulated investment company, the
fund is not subject to income taxes if such distributions are made. Required
distributions are determined on a tax basis and may differ from net investment
income for financial reporting purposes. In addition, the fiscal year in which
amounts are distributed may differ from the year in which the net investment
income is recorded by the fund.

As of September 30, 1999, net unrealized depreciation on investments for book
and federal income tax purposes aggregated $13,000, of which $3,000 related to
appreciated securities and $16,000 related to depreciated securities. The cost
of portfolio securities for book and federal income tax purposes was
$256,624,000 at September 30, 1999.

3. FEES AND TRANSACTIONS WITH RELATED PARTIES

INVESTMENT ADVISORY FEE - The fee of $1,003,000 for management services
was incurred pursuant to an agreement with Capital Research and Management
Company (CRMC), with which certain officers and Trustees of the fund are
affiliated. The Investment Advisory and Service Agreement in effect through
October 1, 1999, provided for monthly fees, accrued daily, based on an annual
rate of 0.44% of the first $200 million of average net assets; 0.42% of such
assets in excess of $200 million but not exceeding $600 million; 0.38% of such
assets in excess of $600 million but not exceeding $1.2 billion; and 0.34% of
such assets in excess of $1.2 billion.

The Investment Advisory and Service Agreement also provided for a fee
reduction to the extent that annual operating expenses exceed 0.75% of the
average daily net assets of the fund, during a period which will terminate at
the earlier of such time as no reimbursement has been required for a period of
twelve consecutive months, provided no advances are outstanding, or October 2,
1999. CRMC had also voluntarily agreed to waive its fees to the extent
necessary to ensure that the fund's expenses do not exceed 0.65% of the average
daily net assets. Expenses that are not subject to these limitations are
interest, taxes, brokerage commissions, transaction costs, and extraordinary
expenses. Fee reductions were $56,000 for the year ended September 30, 1999.

The Board of Trustees approved an amended agreement effective October 2,
1999, reducing the fees to 0.39% of the first $200 million of average net
assets; 0.37% of such assets in excess of $200 million but not exceeding $600
million; 0.33% of such assets in excess of $600 million but not exceeding $1.2
billion; and 0.29% of such assets in excess of $1.2 billion.

DISTRIBUTION EXPENSES - Pursuant to a Plan of Distribution with American
Funds Distributors, Inc. (AFD), the fund may expend up to 0.15% of its average
net assets annually for any activities primarily intended to result in sales of
fund shares, provided the categories of expenses for which reimbursement is
made are approved by the fund's Board of Trustees. Fund expenses under the Plan
include payments to dealers to compensate them for their selling and servicing
efforts. During the year ended September 30, 1999, distribution expenses under
the Plan were $109,000. As of September 30, 1999, accrued and unpaid
distribution expenses were $7,000.

TRANSFER AGENT FEE - American Funds Service Company (AFS), the transfer
agent for the fund, was paid a fee of $153,000.

DEFERRED TRUSTEES' FEES - Trustees who are unaffiliated with CRMC may
elect to defer part or all of the fees earned for services as members of the
Board. Amounts deferred are not funded and are general unsecured liabilities of
the fund. As of September 30, 1999, aggregate deferred amounts and earnings
thereon since the deferred compensation plan's adoption (1993), net of any
payments to Trustees, were $11,000.

CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both
wholly owned subsidiaries of CRMC. Certain Trustees and officers of the fund
are or may be considered to be affiliated with CRMC, AFS and AFD. No such
persons received any remuneration directly from the fund.

4. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES

The fund made purchases and sales of investment securities, including
maturities of $1,277,000,000 and $1,217,379,000, respectively, during the year
ended September 30, 1999.

PER-SHARE DATA AND RATIOS
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------
Year ended September 3
-----------------------------------
1999 1998 1997
-----------------------------------
Net Asset Value, Beginning of Year $1.00 $1.00 $1.00
-----------------------------------
Income from Investment Operations:
Net investment income .025 .029 .029
-----------------------------------
Total from investment operations .025 .029 .029
-----------------------------------
Less Distributions:
Dividends (from net investment income) (.025) (.029) (.029)
-----------------------------------
Total distributions (.025) (.029) (.029)
-----------------------------------
Net Asset Value, End of Year $1.00 $1.00 $1.00
========== ========== ============
Total Return 2.51% 2.97% 2.94%

Ratios/Supplemental Data:
Net assets, end of year (in millions) $255 $198 $160
Ratio of expenses to average net assets -- 0.68% .71% .74%
before fee waiver
Ratio of expenses to average net assets -- 0.65% .65% .65%
after fee waiver
Ratio of net income to average net assets 2.33% 2.94% 2.94%

1996 1995
------------------------
Net Asset Value, Beginning of Year $1.00 $1.00
------------------------
Income from Investment Operations:
Net investment income .029 .031
------------------------
Total from investment operations .029 .031
------------------------
Less Distributions:
Dividends (from net investment income) (.029) (.031)
------------------------
Total distributions (.029) (.031)
------------------------
Net Asset Value, End of Year $1.00 $1.00
========== ============
Total Return 2.91% 3.14%

Ratios/Supplemental Data:
Net assets, end of year (in millions) $144 $150
Ratio of expenses to average net assets -- .77% .75%
before fee waiver
Ratio of expenses to average net assets -- .65% .65%
after fee waiver
Ratio of net income to average net assets 2.88% 3.09%

</TABLE>

Report of Independent Accountants

To the Board of Trustees and Shareholders of The Tax-Exempt Money Fund of
America:

In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, and the related statements of operations and of
changes in net assets and the per-share data and ratios present fairly, in all
material respects, the financial position of The Tax-Exempt Money Fund of
America(the "Fund") at September 30, 1999, the results of its operations, the
changes in its net assets and the per-share data and ratios for the years
indicated, in conformity with generally accepted accounting principles. These
financial statements and per-share data and ratios (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at September 30, 1999 by correspondence with the custodian, provide
a reasonable basis for the opinion expressed above.

/s/PricewaterhouseCoopers LLP
Los Angeles, California
October 29, 1999

1999 Tax Information (unaudited)

We are required to advise you within 60 days of the fund's fiscal year-end
regarding the federal tax status of distributions received by shareholders
during such fiscal year.

Shareholders may exclude from federal taxable income any exempt-interest
dividends paid from net investment income. All of the dividends paid from net
investment income qualify as exempt-interest dividends.