<PAGE> 1
SCHWABFUNDS(R)
[LOGO]
SCHWAB
TAX-EXEMPT MONEY
FUND-SWEEP SHARES
SEMI-ANNUAL REPORT
JUNE 30, 1995
[Photo of Schwab Building, San Francisco, California]
<PAGE> 2
Dear Fellow Shareholder,
This year, the SchwabFunds Family(TM) celebrates its fifth
anniversary as a mutual fund complex. This celebration follows an
[Photo exciting 1994 when the organization experienced tremendous
of growth-- the third largest asset growth of all mutual fund
Charles companies. By placing your trust in SchwabFunds(R), you've helped
R. Schwab] total assets under management reach $27 billion, ranking
SchwabFunds in the top 6% of all mutual fund complexes in just a
few years.
We believe much of this success can be traced to the Schwab commitment to
serving the needs of Fund shareholders, a commitment demonstrated by the entire
SchwabFunds staff and, in particular, by our experienced team of portfolio
managers.
The 20 professionals who make up our growing portfolio management team are
devoted to monitoring the financial markets for you. Through careful and
disciplined selection of securities, they strive to construct optimal portfolios
that provide shareholders with competitive returns that meet their investment
goals. Shareholders continue to signal their trust in the 175 years of combined
experience behind our SchwabFunds portfolio management by keeping their money
invested in SchwabFunds. In fact, a large number of the 1.5 million shareholders
have been investing in the SchwabFunds Family since its first year of operation.
We believe an important part of serving your needs is keeping you informed about
your investments. For example, we've added the question and answer section of
this report, developed to address what our portfolio managers feel have been the
most pressing questions we've heard from shareholders over the period. It is one
way we hope to keep communication open between you and the people managing your
investments. In addition, now that Charles Schwab Investment Management, Inc.
will be managing the day-to-day portfolio management of the three Schwab equity
funds, we will be even better able to meet your service needs and respond to
your questions.
The SchwabFunds Family has grown to include a solid selection of funds that meet
the "core" needs of investors. The 16 funds available to retail investors offer
effective diversification of the U.S. and international equity markets, both
taxable and tax-free bonds, and a variety of money market investments. With this
level of diversification, you may use the SchwabFunds to create an efficient,
well-rounded portfolio. Or, they can serve as building blocks to an overall
investment program that includes more specialized investments.
To receive a brochure and prospectus for any of the SchwabFunds, you can call
Schwab's toll-free number, 1-800-2 NO-LOAD, or visit any one of the over 200
Schwab offices. The prospectus includes more complete information on the Funds,
including charges and expenses. Please read it carefully before investing.
I'd like to extend my personal gratitude for your trust in the SchwabFunds
Family. You should feel confident that the outstanding efforts of all those who
are part of the SchwabFunds organization will continue going forward. And, we
expect these efforts to help us meet even higher standards of excellence in the
years ahead.
/s/ Charles R. Schwab
Charles R. Schwab
Chairman
Cover: The Schwab Building, San Francisco, California
<PAGE> 3
YES! I'D LIKE TO TAKE
ADVANTAGE OF AN EASY WAY
TO EFFECTIVELY DIVERSIFY MY EQUITY PORTFOLIO.
Please send me more information, including prospectuses, for the three
Schwabfunds(R) equity index funds listed below.
SCHWAB 1000 FUND(R) is designed to match the total return of the Schwab 1000
Index(R), Schwab's own benchmark of America's 1,000 largest companies, based on
market capitalization.
SCHWAB SMALL-CAP INDEX FUND(TM) seeks to track the total return of the Schwab
Small-Cap Index(TM), comprised of the second 1,000 largest U.S. companies,
ranked by market capitalization.
SCHWAB INTERNATIONAL INDEX FUND(TM) seeks to track the total return of the
Schwab International Index(TM), comprised of 350 of the largest publicly traded
companies (based on market capitalization) in countries with developed
securities markets outside of the U.S.
The prospectus provides more complete information, including charges and
expenses. Please read it carefully before investing.
--------------------------------------------------------------------------------
NAME
--------------------------------------------------------------------------------
ADDRESS
--------------------------------------------------------------------------------
CITY STATE ZIP
See the back page for more information.
[SCHWABFUNDS FAMILY LOGO]
TEFS5
<PAGE> 4
-------------
NO POSTAGE
NECESSARY IF
MAILED IN THE
UNITED STATES
-------------
--------------------------------------------------------
BUSINESS REPLY MAIL
FIRST CLASS MAIL PERMIT NO. 18125 SAN FRANCISCO, CA
--------------------------------------------------------
POSTAGE WILL BE PAID BY ADDRESSEE
CHARLES SCHWAB & CO., INC.
P O BOX 7780
SAN FRANCISCO CA 94120-9588
[BARCODE]
<PAGE> 5
COMMENTS FROM THE INVESTMENT ADVISER
We're pleased to report to you on the performance of the Schwab Tax-Exempt Money
Fund -- Sweep Shares for the six-month period ended June 30, 1995. During the
first half of this year, the Fund once again proved successful at providing a
competitive level of current income exempt from federal income tax*, combined
with capital stability and ready access to your money.
The Schwab Tax-Exempt Money Fund -- Sweep Shares experienced strong asset growth
during the period, as both new and existing shareholders contributed additional
assets to the Fund. On June 30, 1995, the Fund's total net assets reached a new
high of nearly $3.2 billion, more than a 5% increase in the six-month reporting
period since the end of 1994.
NEW NAME HIGHLIGHTS SWEEP FEATURE
As you've probably noticed, we've added the term Sweep Shares to the name of the
Schwab Tax-Exempt Money Fund. This addition highlights the Fund's convenient
automatic sweep feature, which can be a useful component of your portfolio. Cash
balances of $100 or more in your Schwab account are automatically invested in
the Fund on a regular basis to keep your cash working in between investments.
You may rest assured that the Fund's investment objectives, strategy and
policies all remain the same.
PERFORMANCE REVIEW
Both short-term taxable interest rates, as well as tax-exempt rates declined
slightly during the first half of 1995. The table below presents the Fund's
7-day average yields at the end of the period. As with all money market funds,
past performance is no guarantee of future results.
================================================================================
7-DAY AVERAGE YIELDS
(As of 6/30/95)
<TABLE>
<CAPTION>
Simple Compound Compound Taxable Equivalent**
--------------------------------------------------------------------------------
<S> <C> <C>
3.47% 3.53% 5.84%
</TABLE>
--------------------------------------------------------------------------------
HIGHER RETURNS, AFTER TAXES
Income taxes can significantly erode your investment returns -- especially if
you're in a high tax bracket. The Schwab Tax-Exempt Money Fund -- Sweep Shares
is designed to provide high after-tax returns in the form of current income that
is exempt from federal income tax.*
* Income may be subject to state or local taxes and the Alternative Minimum Tax
(AMT).
** Taxable equivalent yield assumes a federal income tax rate of 39.6%.
<PAGE> 6
Depending on your tax bracket, the Fund's tax-exempt income may offer you a
significant yield advantage over taxable money funds on a taxable equivalent
basis. For example, although past performance is no guarantee of future results,
on June 27, 1995, the Fund's 7-day simple yield was 3.49% and compound yield was
3.55%; for shareholders in the highest tax bracket, this compound yield
translates to a compound taxable equivalent yield of 5.88%, which surpasses the
5.56% compound 7-day average yield for fully taxable money funds on June
27,1995. 1
KEY GOAL: CAPITAL STABILITY
If you're like most money market fund investors, preserving the value of your
investment is an important concern. That's why the Schwab Tax-Exempt Money Fund
-- Sweep Shares is managed with stability of capital as a fundamental objective.
To protect your principal, the Fund seeks to maintain a stable $1 share price.
As with all money market funds, of course, there can be no assurance that the
Fund will be able to maintain a $1 net asset value, and your investment is
neither insured nor guaranteed by the U.S. Government.
HIGH-QUALITY PORTFOLIO
The Schwab Tax-Exempt Money Fund -- Sweep Shares seeks to invest in a
diversified portfolio of high-quality, short-term municipal securities. To limit
credit risk, the Fund primarily invests in securities rated in the top two
rating categories by national rating agencies. We maintain strict credit quality
standards for the Fund's portfolio, while actively managing portfolio maturity
to help protect and enhance your returns. The chart below illustrates the Fund's
portfolio composition on June 30, 1995. In addition, you'll find a complete
listing of the securities in the Fund's portfolio as of June 30, 1995 later in
this report.
SCHWAB TAX-EXEMPT MONEY FUND
PORTFOLIO COMPOSITION
JUNE 30, 1995
[Pie chart indicating percentages as of June 30, 1995 for the Tax-Exempt Money
Fund]
<TABLE>
<S> <C>
Bonds Under 13 Months 8%
Notes 12%
Put Bonds 8%
Tax-Exempt Commercial Paper 10%
Variable Rate Obligations 55%
Variable Rate Tender Option Bonds/Partnerships 7%
</TABLE>
1 Source: IBC/Donoghue, average compound seven-day yield for the 254 funds in
the First Tier category of Taxable Money Funds as of June 27, 1995.
<PAGE> 7
To enhance your understanding of the performance of the Schwab
Tax-Exempt Money Fund -- Sweep Shares, the portfolio management team offers
insights into economic trends and the Fund's investment strategy in the
following section. If you want more information on the Fund, or any of the
mutual funds in the SchwabFunds Family(TM), visit your local Schwab office or
call 1-800-2 NO-LOAD.
LOOKING FORWARD IN 1995
While the outlook for interest rates in the second half of the year is
uncertain, we remain confident that the Schwab Tax-Exempt Money Fund -- Sweep
Shares will continue to strive to offer you an effective cash management tool
that can help you earn a competitive level of current income exempt from federal
personal income taxes, without sacrificing safety and liquidity.
At SchwabFunds(R), we recognize that we earn your trust day by day. We
appreciate your continued confidence in our efforts, and we look forward to
helping you achieve your financial goals in the future.
CHARLES SCHWAB INVESTMENT MANAGEMENT, INC.
<PAGE> 8
QUESTIONS TO THE PORTFOLIO MANAGEMENT TEAM OF CHARLES SCHWAB INVESTMENT
MANAGEMENT, INC.
Stephen B. Ward - Senior Vice President and Chief Investment Officer Walter
Beveridge - Portfolio Manager
Q. WHAT HAS BEEN THE ECONOMIC CLIMATE IN THE FIRST SIX MONTHS OF 1995?
A. Following an impressive 4.1% growth rate of the Gross Domestic Product
(GDP) during 1994, the highest annual growth rate in ten years, economic
activity is showing increasing signs of slowing. Recent evidence of this trend
includes slowdowns in auto sales, consumer spending and retail sales, home
building and home sales, and a somewhat dramatic slowdown in the labor markets.
The GDP growth rate for the first quarter of 1995 was 2.7%, and 0.5% for the
second quarter.
The primary reason for the slowdown in the GDP growth rate has been a series of
increases in the federal funds rate implemented by the Federal Reserve ("the
Fed") throughout 1994 and into 1995. With the high rate of growth in 1994 and a
falling civilian unemployment rate, potential inflation emerged as a major
concern at the Fed. As a result, the Fed initiated a series of increases in the
federal funds rate, resulting in a rise from 3.0% in January 1994 to 6.0% in
February 1995. As evidenced by the Fed's recent 0.25% reduction in the federal
funds rate in July 1995, these increases appear to have accomplished their
desired effect of slowing the rate of economic growth to more moderate levels
and reducing the likelihood of increases in the rate of inflation.
Q. HOW HAVE THE ECONOMIC EVENTS OF THE LAST SIX MONTHS IMPACTED SHORT-TERM
INTEREST RATES?
A. Short-term interest rates have been declining slowly since the beginning of
the year. For example, the 90-day commercial paper rate dropped from
approximately 6.3% at the beginning of the year to approximately 5.9% on June
30, 1995. This decline has been a result of the anticipation that the Fed will
lower interest rates, a practice known as "easing," as well as the economic
slowdown that was brought on by prior increases in interest rates, a practice
known as "tightening."
Q. HOW HAVE SHORT-TERM TAX-EXEMPT RATES RESPONDED TO THE DECLINES IN TAXABLE
RATES?
A. Unlike short-term taxable rates, short-term tax-exempt rates did not
experience an overall decline during the first four months of 1995. As shown in
the graph on the following page, these rates were characterized by a degree of
volatility with no clear trend during the initial four months of the year.
During May and June, strong demand for shorter term fixed rate securities caused
a significant reduction in the 90-day municipal commercial paper rate.
Differences in rate movements of tax-exempt versus taxable securities are
attributable to the difference in supply and demand conditions in these markets.
The supply of tax-exempt securities is more irregular because tax-exempt issuers
enter the market based on budget, tax, and legal considerations -- different
motivations from those of taxable issuers.
<PAGE> 9
INTEREST RATES DECLINED IN
THE FIRST HALF OF 1995
YIELDS
90-DAY MUNICIPAL COMMERCIAL PAPER
JANUARY 6, 1995 - JUNE 30, 1995
[Graph of 90-Day Municipal Commercial Paper]
<TABLE>
<CAPTION>
90-DAY MUNICIPAL
DATE COMMERCIAL PAPER
---- ----------------
<S> <C>
1/6 4.00
1/13 4.06
1/20 4.02
1/27 4.04
2/3 4.00
2/10 4.15
2/17 4.18
2/24 4.04
3/1 4.08
3/10 3.91
3/17 3.96
3/24 3.90
3/31 3.96
4/7 3.95
4/13 4.06
4/21 4.10
4/28 4.10
5/5 4.10
5/12 4.09
5/19 3.97
5/26 3.81
6/2 3.69
6/9 3.18
6/16 3.40
6/23 3.60
6/30 3.65
</TABLE>
Source: Lehman Brothers, Inc.
Q. WHAT STANDARDS DOES THE INVESTMENT ADVISER USE IN SELECTING SECURITIES FOR
THE PORTFOLIO?
A. Money market funds are required to hold high-quality securities in their
portfolios. For the Schwab Tax-Exempt Money Fund, we have taken the additional
step of only investing in what are referred to as First Tier securities. In
general, a First Tier security is one that is within certain maturity limits and
carries the top rating from the requisite number of Nationally Recognized
Statistical Rating Organizations (NRSROs), or is deemed to be of comparable
quality by the Trust's Board of Trustees if unrated.
One other method we utilize to increase the overall quality of the Schwab
Tax-Exempt Money Fund's portfolio is to selectively purchase securities which
are insured or backed by a letter of credit from a highly rated financial
institution. These arrangements are frequently referred to as "credit
enhancements" because they provide an incremental level of creditworthiness, in
addition to the strength of the underlying issuer. Schwab's thorough credit
review of the portfolio's securities includes ongoing review of the issuer as
well as the insurance company or financial institution providing any credit
enhancement to the security. Banks which provide enhancements on securities we
purchase represent some of the highest rated U.S., Japanese, and British banks.
<PAGE> 10
Recently there has been a fair amount of news coverage concerning the health of
the Japanese economy in general and Japanese banks in particular. As a result of
our continuous monitoring of the situation in Japan, we are confident that we
have selected the Japanese banks that are among the highest rated in the world.
Selected carefully, these banks appear to represent excellent opportunities to
provide credit enhancements which improve the overall quality of the portfolio.
Q. WE CONTINUE TO READ ABOUT PROBLEMS WITH DERIVATIVES. DOES THE SCHWAB
TAX-EXEMPT MONEY FUND INVEST IN THE DERIVATIVE SECURITIES WHICH HAVE CAUSED
PROBLEMS FOR OTHER MONEY FUNDS?
A. No. Unlike some well-publicized examples, it has always been our position
that such securities are inappropriate for use in money market funds. Therefore,
the Fund has never purchased these types of securities. The Fund only invests in
securities appropriate for money market funds, such as fixed rate notes and
simple variable rate notes or variable rate demand notes. These types of
securities are used in virtually all money market funds.
The Fund also uses more complex variable rate securities relying on puts
(purchase agreements) from high-quality banks and dealers. These high-quality
securities feature good liquidity, and attractive yields. In fact, they are
designed and well-suited for money market funds and many funds use them in their
investment strategies. These securities are called tender option bonds and are
created by attaching a put to another security after its initial issuance. The
SEC is aware that tax-exempt money market funds have been using these securities
for many years and has not objected.
Q. DOES THE FUND OWN ANY ORANGE COUNTY SECURITIES?
A. At the time of this writing, the Fund does not own any unenhanced Orange
County-related securities. As of June 30, 1995, the Schwab Tax-Exempt Money Fund
had 2.3% of its net assets invested in a security called the Orange County
Pooled Tax and Revenue Anticipation Note, a security issued on behalf of 27
Orange County, California school districts. Subsequent to the close of the
reporting period, the Pooled Tax and Revenue Anticipation Note was paid on time,
in full.
From time to time, the Fund has invested in certain obligations of Orange County
or former Orange County Investment Pool participants which are either insured or
backed by issuance of a letter of credit. Such "credit enhancements" improve the
creditworthiness of the security. These holdings are high-quality and highly
rated securities and their repayment is guaranteed by a bond insurer or major
financial institution. We believe that these positions represent a minimal
credit risk for the Fund.
<PAGE> 11
Q. WHAT IS THE CURRENT STATUS OF THE ORANGE COUNTY SITUATION AND WHAT IMPACT
IS IT LIKELY TO HAVE ON THE FUND?
A. Since we last reported to you in the December 31, 1994 annual report, a
settlement was approved by the Federal bankruptcy court for Orange County which
allowed for the distribution of most of the County's investment pool to its
former participants. Since that time, all of the cities, school districts and
other municipal entities that had invested in the pool, and also had outstanding
notes that have reached their maturity dates, have paid off those notes in full.
On June 27, 1995, the voters of Orange County rejected County Measure R which
would have provided additional sales tax revenue to assist the County in meeting
its obligations. On July 7, 1995, the owners of the Orange County direct
securities which remain outstanding agreed to extend the maturity of their
outstanding notes to June 30, 1996, in order to provide more time for the County
to develop a financial recovery plan. County officials have proposed a plan
which requires certain changes in state laws and diverts for the County's use
certain tax revenues which would otherwise go to local cities and public
agencies. This proposal has not been adopted by the County, the State of
California, or the bankruptcy court, and any solution must survive serious
opposition before it can result in a plan which can actually pay note holders.
In the event the county officials are not successful in adopting a viable plan,
the State of California may require that a bankruptcy trustee be appointed.
Since the Fund currently owns no unenhanced Orange County securities, there
should be no further exposure to credit loss resulting from the Orange County
bankruptcy.
<PAGE> 12
SchwabFunds(R)
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
PORTFOLIO SUMMARY
(Unaudited)
--------------------------------------------------------------------------------
ASSET GROWTH
<TABLE>
<CAPTION>
Total Total Percentage
Net Assets Net Assets Growth Over
as of 6/30/95 as of 12/31/94 Reporting
(000s) (000s) Period
<S> <C> <C>
------------------------------------------------
$ 3,181,587 $3,015,951 5%
------------------------------------------------
</TABLE>
AVERAGE YIELDS FOR THE PERIODS ENDED ON
JUNE 30, 1995
<TABLE>
<CAPTION>
Last Last Last
Seven Days Three Months Twelve Months
<S> <C> <C>
---------------------------------------------
3.47% 3.46% 2.97%
---------------------------------------------
</TABLE>
MATURITY SCHEDULE
PERCENT OF TOTAL INVESTMENTS
<TABLE>
<CAPTION>
Maturity Range 9/30/94 12/31/94 3/31/95 6/30/95
<S> <C> <C> <C> <C>
-----------------------------------------------------------------
0 - 15 Days.... 71.5% 72.3% 74.7% 70.4%
16 - 30 Days.... 2.9% 3.2% 0.2% 3.8%
31 - 60 Days.... 1.1% 7.9% 6.3% 5.4%
61 - 90 Days.... 3.2% 2.7% 2.6% 3.7%
91 - 120 Days.... 2.4% 0.0% 6.9% 2.1%
Over 120 Days.... 18.9% 13.9% 9.3% 14.6%
Weighted
Average........ 60 Days 39 Days 36 Days 53 Days
-----------------------------------------------------------------
</TABLE>
<PAGE> 13
SchwabFunds(R) 1
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
VARIABLE RATE OBLIGATIONS
--54.72%(a)
ALABAMA--1.16%
Citronelle, Alabama
Industrial Development
Board Pollution Control
Revenue Refunding
Bonds (AKZO Chemicals,
Inc. Project)/
(Wachovia Bank LOC)
4.15%, 07/07/95 $ 1,100 $ 1,100
Mobile, Alabama
Industrial Development
Board Pollution Control
Revenue Refunding
Bonds (Alabama
Power Co. Project)
Series 1993C
4.15%, 07/07/95 12,000 12,000
Montgomery, Alabama
Special Care Facility
Financing Authority
Revenue Bonds
(Baptist Medical Center
VHA) Series 1985C/
(AMBAC Insurance &
FNB Chicago SBPA)
4.05%, 07/07/95 2,000 2,000
Montgomery, Alabama
Special Care Facility
Financing Authority
Revenue Bonds
(Baptist Medical Center
VHA) Series 1985F/
(AMBAC Insurance &
FNB Chicago SBPA)
4.05%, 07/07/95 9,000 9,000
Montgomery, Alabama
Special Care Facility
Financing Authority
Revenue Bonds
(Baptist Medical Center
VHA) Series 1985G/
(AMBAC Insurance &
FNB Chicago SBPA)
4.05%, 07/07/95 6,390 6,390
Montgomery, Alabama
Special Care Facility
Financing Authority
Revenue Bonds
(Baptist Medical Center
VHA) Series 1985H/
(AMBAC Insurance &
FNB Chicago SBPA)
4.05%, 07/07/95 5,295 5,295
Opelika, Alabama Industrial
Development Board
Revenue Bonds
(Power Guard Project)
Series 1994/(SouthTrust
Bank of Alabama LOC)
4.35%, 07/07/95 3,100 3,100
----------
38,885
----------
ARIZONA--0.23%
Yavapai County, Arizona
Industrial Development
Authority Industrial
Development Revenue
Bonds (First Health Care
Corp. Project)/
(Wachovia Bank LOC)
4.25%, 07/07/95 4,230 4,230
Yuma, Arizona
Industrial Development
Authority Multi Family
Housing Revenue Bonds
(El Encanto Apartments)
Series A/(Citibank LOC)
4.30%, 07/07/95 3,000 3,000
Yuma, Arizona
Industrial Development
Authority Multi Family
Housing Revenue Bonds
(El Encanto Apartments)
Series B/(Citibank LOC)
4.60%, 07/07/95 425 425
----------
7,655
----------
CALIFORNIA--1.15%
Anaheim, California
Certificates of
Participation (Anaheim
Memorial Hospital Assoc.
Project)/ (AMBAC Insurance
& Industrial Bank of
Japan SBPA)
4.05%, 07/07/95 1,100 1,100
California Health
Facilities Financing
Authority Revenue Bonds
Pooled Loan Program Series
1985B/(FGIC Insurance &
FGIC SPA)
4.05%, 07/01/95 2,100 2,100
California Pollution
Control
Financing Authority
Pollution Control
Revenue Bonds
(Southern California
Edison) Series 1986B
4.50%, 07/01/95 1,600 1,600
California Pollution
Control
Financing Authority
Pollution Control
Revenue Bonds
(Southern California
Edison) Series 1986C
4.50%, 07/01/95 5,100 5,100
California Statewide
Communities Development
Corp. Revenue Bonds
(Packaging Innovation
DZ Industries, Inc.)
Series 1994A-2/
(Bank of Tokyo LOC)
3.85%, 07/07/95 585 585
</TABLE>
<PAGE> 14
SchwabFunds(R) 2
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Contra Costa, California
Transportation Authority
Sales Tax Revenue
Bonds Series 1993A/
(FGIC Insurance)
3.90%, 07/07/95 $ 300 $ 300
Irvine Ranch, California
Water District
Certificates of
Participation Capital
Improvement Project/
(Morgan Guaranty
Trust LOC)
4.15%, 07/01/95 17,300 17,300
Irvine Ranch, California
Water District
Consolidated District
Numbers 140,240,105,250
Revenue Bonds/
(Bank of America LOC)
4.35%, 07/01/95 2,500 2,500
Irvine Ranch, California
Water District
Consolidated Districts
105,250,290 Revenue
Refunding
Bonds Series 1991/
(National Westminster LOC)
4.15%, 07/01/95 700 700
Irvine Ranch, California
Water District
Consolidated Revenue Bonds
Series 1985B/
(Sumitomo Bank LOC)
4.35%, 07/01/95 1,900 1,900
Los Angeles County,
California Certificates of
Participation ACES (Los
Angeles County Museum of
Art Project) Series 1985A/
(Bank of America LOC)
4.05%, 07/07/95 1,200 1,200
Los Angeles County,
California Metropolitan
Transportation Authority
Sales Tax Revenue
Refunding Bonds Series A
Proposition C Second/
(MBIA Insurance &
Industrial Bank of Japan
SBPA)
3.90%, 07/07/95 300 300
Los Angeles County,
California Transportation
Commission Sales Tax
Revenue Refunding Bonds
Series 1992A/(FGIC
Insurance & Industrial
Bank of Japan SBPA)
3.95%, 07/07/95 600 600
San Diego County,
California Regional
Transportation Commission
Second Senior Sales Tax
Revenue Bonds Series
1992A/(FGIC Insurance &
FGIC SPA)
4.05%, 07/07/95 400 400
Santa Clara, California
Electric Revenue Bonds
Series 1985C/
(National West-
minster LOC)
4.05%, 07/07/95 1,500 1,500
Southern California
Public Power Authority
Transmission Project
Revenue Bonds Series 1991/
(AMBAC Insurance &
Swiss Bank LOC)
3.90%, 07/07/95 1,500 1,500
----------
38,685
----------
COLORADO--4.79%
Colorado Health Facilities
Authority Revenue Bonds
(Sisters of Charity
Health) Series B/(Multiple
Credit Enhancements)
3.95%, 07/07/95 23,300 23,300
Colorado Student Obligation
Bonds Authority Student
Loan Revenue Bonds
(Colorado University)
Series 1989A/
(Sumitomo Bank LOC)
4.30%, 07/07/95 16,600 16,600
Colorado Student Obligation
Bonds Authority Student
Loan Revenue Bonds
(Colorado University)
Series 1990A/
(Sumitomo Bank LOC)
4.30%, 07/07/95 14,000 14,000
Colorado Student Obligation
Bonds Authority Student
Loan Revenue Bonds
(Colorado University)
Series 1993B/
(SLMA LOC)
4.30%, 07/07/95 5,500 5,500
Colorado Student Obligation
Bonds Authority Student
Loan Revenue Bonds
(Colorado University)
Series 1993C-2/
(SLMA LOC)
4.15%, 07/07/95 1,300 1,300
Denver, Colorado City and
County Airport System
Revenue Bonds Series
1992D/(Morgan Guaranty
Trust LOC)
4.25%, 07/01/95 32,900 32,900
Denver, Colorado City and
County Airport System
Revenue Bonds Series
1992E/
(Bank of Tokyo LOC)
4.35%, 07/07/95 30,000 30,000
</TABLE>
<PAGE> 15
SchwabFunds(R) 3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Denver, Colorado City and
County Airport System
Revenue Bonds Series
1992F/
(Bank of Montreal LOC)
4.25%, 07/07/95 $16,000 $ 16,000
Denver, Colorado City and
County Airport System
Revenue Bonds Series
1992G/(Credit Local de
France LOC)
4.25%, 07/07/95 8,500 8,500
Douglas County, Colorado
Multi Family Housing
Revenue Bonds
(Autumn Chase Project)/
(Citibank LOC)
4.00%, 07/07/95 9,600 9,600
Pitkin County, Colorado
Industrial Development
Revenue Bonds (Aspen
Skiing Colorado Project)
Series 1994B/
(FNB Chicago LOC)
4.85%, 07/01/95 2,800 2,800
----------
160,500
----------
CONNECTICUT--3.28%
Connecticut State General
Obligation Economic
Recovery Bonds Series
1991B/(Multiple Credit
Enhancements)
3.95%, 07/07/95 21,100 21,100
Connecticut State Special
Assessment Unemployment
Compensation Advance Fund
Revenue Bonds Series
1993B/(Multiple Credit
Enhancements)
4.20%, 07/07/95 65,900 65,900
Connecticut State Special
Tax Obligation Bonds
(Second Lien Transportation
Information) Series
1990-1/(Industrial Bank of
Japan LOC)
4.00%, 07/07/95 22,800 22,800
----------
109,800
----------
DISTRICT OF COLUMBIA--0.13%
District of Columbia
Revenue Bonds (ACES
Georgetown University)
Series 1988D/ (Sanwa Bank
SBPA)
4.30%, 07/07/95 4,200 4,200
----------
FLORIDA--1.56%
Brevard County, Florida
Housing Finance Authority
Multi Family Housing
Revenue Bonds
(Palm Place Project)/
(Chemical Bank LOC)
3.85%, 07/07/95 5,000 5,000
Dade County, Florida
Solid Waste Industrial
Development Revenue
Bonds (Montenay-Dade,
Ltd. Project)/
(Banque Paribas LOC)
4.45%, 07/07/95 1,380 1,380
Dade County, Florida
Solid Waste Industrial
Development Revenue
Bonds (Montenay-Dade,
Ltd. Project) Series
1990A/
(Banque Paribas LOC)
4.45%, 07/07/95 2,100 2,100
Florida Housing Finance
Agency Multi Family
Housing Revenue Bonds
(Blairstone Project)
Series VV/(Citibank LOC)
4.35%, 07/07/95 1,900 1,900
Hillsborough County,
Florida Industrial
Development Authority
Revenue Bonds (Seaboard
Tampa Terminals) Series
1986A/ (Barclays Bank LOC)
3.85%, 07/07/95 5,500 5,500
Indian Trace, Florida
Community Development
District (Water & Sewer
Special Assessment Basin 1
Water)/(MBIA Insurance &
Swiss Bank SBPA)
4.15%, 07/07/95 9,700 9,700
Orange County, Florida
Housing Finance Authority
Multi Family Housing
Revenue Bonds (Rio Vista
Project)/(First Union Bank
of North Carolina LOC)
3.85%, 07/07/95 3,865 3,865
Orange County, Florida
Housing Finance Authority
Multi Family Housing
Revenue Bonds (Smokewood
Project)/ (Citibank LOC)
4.00%, 07/07/95 10,000 10,000
Palm Beach County, Florida
Health Facilities
Authority Revenue
Refunding Bonds (Joseph L.
Morse Geriatric
Center)/(Sun Bank LOC)
4.00%, 07/07/95 9,955 9,955
Palm Beach County, Florida
Housing Finance Authority
Multi Family Housing
Revenue Bonds
(Crystal II Project)/
(Citibank LOC)
4.50%, 07/07/95 2,850 2,850
----------
52,250
----------
</TABLE>
<PAGE> 16
SchwabFunds(R) 4
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
GEORGIA--2.41%
Burke County, Georgia
Development Authority
Pollution Control Revenue
Bonds (Oglethorpe
Power Corp. Project)
Series 1993A/(FGIC
Insurance & Industrial
Bank of Japan SBPA)
4.20%, 07/07/95 $15,300 $ 15,300
Cobb County, Georgia
Housing Authority Multi
Family Housing Revenue
Bonds (Williamstown
Apartment Project)/
(Wachovia Bank LOC)
4.15%, 07/07/95 2,000 2,000
Dekalb County, Georgia
Development Authority
Industrial Development
Revenue Bonds (Siemens
Energy, Inc. Project)
4.20%, 07/07/95 3,750 3,750
Dekalb County, Georgia
Housing Authority Multi
Family Housing Revenue
Bonds (Columbia on
Clairmont) Series H/
(Citibank LOC)
4.00%, 07/07/95 2,120 2,120
Dekalb County, Georgia
Housing Authority Multi
Family Housing Revenue
Bonds (Wood Hills
Apartment Project)/
(Bank of Montreal LOC)
3.90%, 07/07/95 5,250 5,250
Dekalb, Georgia Private
Hospital Authority
Revenue Anticipation
Certificates (Egleston
Childs Hospital/Emory
University) Series 1994A
& B4/(Trust Bank of
Atlanta LOC)
4.15%, 07/07/95 12,000 12,000
Douglas County, Georgia
Development Authority
Industrial Development
Revenue Bonds
(Mima Inc. Project)/
(Wachovia Bank LOC)
4.40%, 07/07/95 4,300 4,300
Laurens County, Georgia
Development Authority
Solid Waste Disposal
Revenue Bonds (Southeast
Paper Co. Project)/
(Wachovia Bank LOC)
4.25%, 07/07/95 25,000 25,000
Rockmart, Georgia
Development Authority
Industrial Development
Revenue Bonds
(CW Matthews
Contracting)/ (Wachovia
Bank LOC)
4.25%, 07/07/95 2,500 2,500
Smyrna, Georgia
Housing Authority Multi
Family Housing Revenue
Bonds (Walton Park LP)/
(Wachovia Bank LOC)
4.15%, 07/07/95 7,000 7,000
Villa Rica, Georgia
Industrial Development
Revenue Bonds (Lowes Home
Centers, Inc. Project)/
(Wachovia Bank LOC)
4.15%, 07/07/95 1,500 1,500
----------
80,720
----------
HAWAII--1.63%
Hawaii State Department of
Budget and Finance Special
Purpose Mortgage Revenue
Bonds (Adventist Health
System West)/ (Bank of
California LOC)
4.10%, 07/07/95 3,100 3,100
Hawaii State Housing
Finance & Development
Corp. Revenue Bonds
(Rental Housing System)
Series 1990A/(Industrial
Bank of Japan LOC)
4.25%, 07/07/95 17,100 17,100
Hawaii State Housing
Finance & Development
Corp. Revenue Bonds
(Rental Housing System)
Series 1990B/(Industrial
Bank of Japan LOC)
4.25%, 07/07/95 19,600 19,600
Honolulu, Hawaii
City and County Multi
Family Housing Revenue
Bonds (HaleKa Gardens
Project) Series A/
(Bank of Tokyo LOC)
4.55%, 07/07/95 5,379 5,379
Honolulu, Hawaii
City and County Multi
Family Housing Revenue
Bonds (Iolani Regents
Project) Series 1990A/
(Bank of Hawaii LOC)
4.05%, 07/07/95 9,300 9,300
----------
54,479
----------
</TABLE>
<PAGE> 17
SchwabFunds(R) 5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
ILLINOIS--10.09%
Centralia, Illinois
Industrial Development
Authority Revenue Bonds
(Consolidated Foods
Corp./Hollywood
Brands, Inc. Project)/
(Wachovia Bank LOC)
4.15%, 07/07/95 $ 4,500 $ 4,500
Chicago, Illinois
General Obligation
Bonds Series 1985/
(Sanwa Bank LOC)
3.95%, 07/07/95 14,440 14,440
Chicago, Illinois
General Obligation
Bonds Series 1992B/
(Canadian Imperial
Bank of Commerce LOC)
4.05%, 07/07/95 10,400 10,400
Chicago, Illinois O'Hare
International Airport
Revenue Bonds (ACES
General Airport Second
Lien) Series B/
(Sanwa Bank LOC)
4.35%, 07/07/95 10,000 10,000
Chicago, Illinois O'Hare
International Airport
Revenue Bonds (General
Airport Second Lien)
Series 1994C/
(Societe Generale LOC)
4.00%, 07/07/95 35,000 35,000
Chicago, Illinois O'Hare
International Airport
Revenue Bonds (General
Airport Second Lien)
Series A/(Westpac Banking
Corp. LOC)
4.15%, 07/07/95 13,100 13,100
Illinois Development
Financing Authority
Hospital Revenue
Bonds (Palos Community
Hospital) Series 1994/
(Credit Suisse LOC)
4.00%, 07/01/95 27,700 27,700
Illinois Development
Financing Authority
Industrial Development
Revenue Bonds (Knead
Dough Baking Co.)/
(Bank of America LOC)
4.40%, 07/07/95 4,540 4,540
Illinois Development
Financing Authority
Industrial Development
Revenue Bonds (Marriott
Corp. Deerfield Project)/
(National Westminster
LOC)
4.25%, 07/07/95 1,300 1,300
Illinois Development
Financing Authority
Industrial Development
Revenue Bonds (Rerkin
Paperboard Co. LP)
Series 1994/
(Northern Trust LOC)
4.35%, 07/07/95 5,500 5,500
Illinois Development
Financing Authority
Revenue Residential
Rental Bonds
(River Oak)/
(Swiss Bank LOC)
4.35%, 07/07/95 11,790 11,790
Illinois Educational
Facility Authority
Revenue Bonds (Chicago
Historical Society)/
(Mitsubishi Bank LOC)
4.15%, 07/07/95 8,300 8,300
Illinois Educational
Facility Authority
Revenue Bonds (Illinois
Institute of Technology)
Series 1990A/
(Northern Trust LOC)
4.10%, 07/07/95 11,500 11,500
Illinois Educational
Facility Authority
Revenue Bonds
(Northwestern
University)/ (FNB Chicago
LOC)
4.10%, 07/07/95 22,200 22,200
Illinois Educational
Facility Authority
Revenue Bonds (University
Pooled Financing Program)
Series 1985/
(FGIC Insurance &
Sakura Bank SBPA)
4.45%, 07/07/95 17,695 17,695
Illinois Health Facility
Authority Revenue Bonds
(Franciscan Village
Project) Series 1989A/
(Commonwealth Bank of
Australia LOC)
4.30%, 07/07/95 2,000 2,000
Illinois Health Facility
Authority Revenue Bonds
(Ingalls Memorial
Hospital) Series 1985C/
(Fuji Bank LOC)
4.50%, 07/07/95 1,100 1,100
Illinois Health Facility
Authority Revenue
Bonds (Sisters
Services) Series E/
(MBIA Insurance &
Morgan Guaranty SBPA)
4.00%, 07/07/95 4,300 4,300
Illinois Health Facility
Authority Revenue
Bonds (Streeterville
Corp.) Series A/
(FNB Chicago LOC)
4.15%, 07/07/95 14,400 14,400
</TABLE>
<PAGE> 18
SchwabFunds(R) 6
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Illinois Health Facility
Authority Revenue Bonds
(Washington & Jane Smith
Home) Series 1991/
(Comerica Bank LOC)
4.20%, 07/07/95 $ 2,800 $ 2,800
Illinois Health Facility
Authority Revenue Bonds
Revolving Fund Pooled
Loan Series 1985C/
(FNB Chicago LOC)
4.20%, 07/07/95 6,000 6,000
Illinois Health Facility
Authority Revenue Bonds
Revolving Fund Pooled
Loan Series 1985D/
(FNB Chicago LOC)
4.20%, 07/07/95 20,000 20,000
Illinois State Toll Highway
Authority Revenue Bonds
Series B/(MBIA Insurance)
4.25%, 07/07/95 33,200 33,200
Kane County, Illinois
Revenue Bonds (Glenwood
School for Boys)/(Harris
Trust and Savings Bank
LOC)
4.25%, 07/07/95 9,000 9,000
Lombard, Illinois
Industrial Development
Revenue Refunding
Bonds (B & H
Partnership Project)/
(Comerica Bank LOC)
4.38%, 07/07/95 1,500 1,500
McHenry County, Illinois
Industrial Development
Authority Revenue
Refunding Bonds (Dean
Foods Co. Project)/
(Wachovia Bank LOC)
4.15%, 07/01/95 2,675 2,675
Oak Forest, Illinois
Revenue Bonds (Homewood
Pool) Series 1989/
(FNB Chicago LOC)
4.20%, 07/07/95 37,000 37,000
Savannah, Illinois
Industrial Development
Revenue Bonds (Metform
Corp.) Series 1994A/
(FNB Chicago LOC)
4.30%, 07/07/95 6,000 6,000
----------
337,940
----------
INDIANA--0.45%
Crawfordsville, Indiana
Industrial Development
Revenue Bonds
(National Service
Industries, Inc.
Project)/(Wachovia Bank
LOC)
4.15%, 07/07/95 1,000 1,000
Hammond, Indiana
Adjustable Rate Economic
Development Revenue Bonds
(Lear Seating Corp.
Project) Series 1994/
(Chemical Bank LOC)
4.45%, 07/01/95 5,750 5,750
Indiana Health Facility
Financing Authority
Hospital Revenue Bonds
(Methodist Hospital)
Series C/
(Credit Suisse SBPA)
4.15%, 07/07/95 4,100 4,100
Indianapolis, Indiana
Economic Development
Authority Revenue Bonds
(Herff-Jones, Inc.
Project)/(Wachovia Bank
LOC)
4.25%, 07/07/95 4,100 4,100
----------
14,950
----------
IOWA--0.30%
Des Moines, Iowa
Methodist Health System,
Inc. Hospital Facility
Revenue Bonds
(Methodist Health Care)/
(Fuji Bank LOC)
4.50%, 07/07/95 3,895 3,895
Iowa Higher Education Loan
Authority Revenue Bonds
ACES Education Loan
(Private College
Facility)/ (MBIA
Insurance &
Dai-Ichi Kangyo Bank SBPA)
4.10%, 07/07/95 4,100 4,100
Iowa Housing Finance
Authority Multi Family
Revenue Bonds (Small
Business Loan Project)
Series 1985A/(FHLB of Des
Moines LOC)
4.15%, 07/07/95 2,100 2,100
----------
10,095
----------
KANSAS--0.22%
Kansas City, Kansas
Industrial Revenue Bonds
(Owen Industries, Inc.
Project) Series 1987/
(Sanwa Bank LOC)
4.30%, 07/07/95 2,400 2,400
Wichita, Kansas
Airport Facilities
Revenue Bonds
(Flightsafety
International, Inc.)/
(Wachovia Bank LOC)
4.25%, 07/07/95 3,000 3,000
</TABLE>
<PAGE> 19
SchwabFunds(R) 7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Wichita, Kansas
Health Facilities Revenue
Authority (CSJ Health
System) Series XXV/
(Sumitomo Bank LOC)
4.25%, 07/07/95 $ 1,900 $ 1,900
----------
7,300
----------
KENTUCKY--0.53%
Lebanon, Kentucky
Industrial Development
Revenue Bonds (Wallace
Computer Services, Inc.)/
(Wachovia Bank LOC)
4.20%, 07/07/95 5,000 5,000
Mason County, Kentucky
Pollution Control
Financing Authority
Pollution Control Revenue
Bonds (East Kentucky Power
Corp.) Series 1984B-1/
(N.R.U.--C.F.C. Guaranty)
4.30%, 07/07/95 10,800 10,800
Owensboro, Kentucky
Limited Obligation Revenue
Bonds (Dart Polymers, Inc.
Project) Series 1985A/
(National Westminster LOC)
4.30%, 07/07/95 1,900 1,900
----------
17,700
----------
LOUISIANA--2.97%
De Soto Parish, Louisiana
Pollution Control Revenue
Refunding Bonds (Central
Louisiana Electric Co.)
Series 1991A/
(Swiss Bank LOC)
3.95%, 07/07/95 400 400
Louisiana Public Facilities
Authority Hospital Revenue
Bonds (Willis Knighton
Medical Project)/
(AMBAC Insurance &
Mellon Bank SBPA)
4.10%, 07/07/95 15,300 15,300
New Orleans, Louisiana
Aviation Board Revenue
Bonds (Passenger Facility
Charge Projects)/(Banque
Paribas & Canadian
Imperial
Bank of Commerce LOC)
4.60%, 07/07/95 12,000 12,000
New Orleans, Louisiana
Aviation Board Revenue
Bonds Series B/
(MBIA Insurance &
Industrial Bank of
Japan SBPA)
4.10%, 07/07/95 58,300 58,300
New Orleans, Louisiana
Exhibition Hall Authority
Special Tax Revenue Bonds
(Hotel Occupancy
Project) Series B/
(Sanwa Bank LOC)
4.15%, 07/07/95 1,600 1,600
New Orleans, Louisiana
Exhibition Hall Authority
Special Tax Revenue
Bonds Series 1989B/ (Sanwa
Bank LOC)
4.15%, 07/07/95 3,800 3,800
Rapides Parish, Louisiana
Industrial Development
Board Pollution Control
Revenue Refunding Bonds
(Central Louisiana
Electric Co.) Series 1991/
(Swiss Bank LOC)
3.95%, 07/07/95 8,150 8,150
----------
99,550
----------
MARYLAND--2.40%
Maryland State Health and
Higher Educational
Facility Authority Pooled
Revenue Bonds (Kennedy
Kreiger) Series 1993D/
(FNB Maryland LOC)
4.20%, 07/07/95 2,000 2,000
Maryland State Health and
Higher Educational
Facility Authority Pooled
Revenue Bonds (Pooled Loan
Program) Series A/ (FNB
Chicago SBPA)
4.30%, 07/07/95 9,700 9,700
Mayor and City Council of
Baltimore Industrial
Development Authority
(City of Baltimore Capital
Acquisition Program)
Series 1986/(Dai-Ichi
Kangyo Bank LOC)
4.25%, 07/07/95 52,300 52,300
Montgomery County, Maryland
Housing Opportunity
Commission Housing Revenue
Bonds (Draper Lane) Series
1991I/
(FGIC Insurance &
Sumitomo Bank SBPA)
4.35%, 07/07/95 16,500 16,500
----------
80,500
----------
MICHIGAN--0.10%
Michigan State Strategic
Fund Limited Obligation
Revenue Bonds (Dean Foods
Co. Project)/ (Wachovia
Bank LOC)
4.15%, 07/07/95 3,500 3,500
----------
</TABLE>
<PAGE> 20
SchwabFunds(R) 8
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
MINNESOTA--0.80%
Bloomington, Minnesota
Port Authority Tax
Increment Revenue
Refunding Bonds (Mall of
America) Series 1995A/
(Credit Local de France
SBPA & FSA Insurance)
4.15%, 07/07/95 $ 7,000 $ 7,000
St. Paul, Minnesota
Housing Redevelopment
Authority Rental Multi
Family Housing Development
Bonds (Multi City)
Series 1985A/
(FHLB Des Moines LOC)
4.15%, 07/07/95 19,900 19,900
----------
26,900
----------
MISSOURI--0.44%
Missouri State Development
Finance Board Industrial
Development Revenue Bonds
(H.R. Williams
Mill Supply Project)
Series 1995/(Union Bank of
Switzerland LOC)
4.25%, 07/07/95 3,100 3,100
Missouri State Health and
Educational Facilities
Authority Health
Facilities Revenue Bonds
(Sisters of Mercy) Series
1988A/(Multiple Credit
Enhancements)
4.00%, 07/07/95 3,200 3,200
Missouri State Health and
Educational Facilities
Authority Health
Facilities Revenue Bonds
(Sisters of Mercy) Series
1992B/
(Toronto-Dominion SBPA)
4.00%, 07/07/95 3,400 3,400
Missouri State Health and
Educational Facilities
Authority Health
Facilities
Revenue Bonds (St. Anthony
Medical Center)/
(Mitsubishi Bank SBPA)
3.95%, 07/07/95 900 900
Washington, Missouri
Industrial Development
Authority Revenue
Bonds (Pauwels
Tranformer Project)/
(Generale Bank LOC)
4.65%, 07/07/95 4,000 4,000
----------
14,600
----------
MONTANA--0.49%
Forsyth, Montana Pollution
Control Financing
Authority Pollution
Control Revenue Bonds
(Portland General Electric
Coal Stripping Project)
Series 1983B/ (Swiss Bank
LOC)
4.05%, 07/07/95 1,500 1,500
Montana State Health
Facility Authority Revenue
Bonds (Health Care Pooled
Loan Program) Series
1985A/
(FGIC Insurance & Norwest
Bank of Minnesota SBPA)
4.05%, 07/07/95 15,096 15,096
----------
16,596
----------
NEVADA--0.64%
Clark County, Nevada
Airport Improvement
Revenue Refunding
Bonds Series 1993A/
(MBIA Insurance &
Industrial Bank of
Japan SBPA)
4.20%, 07/07/95 18,650 18,650
Clark County, Nevada
Industrial Development
Revenue Bonds
(Cogeneration Project No.
2)/(Swiss Bank LOC)
4.35%, 07/07/95 2,700 2,700
----------
21,350
----------
NEW HAMPSHIRE--0.24%
New Hampshire Higher
Education and Health
Facilities Authority
Revenue Bonds (VHA New
England, Inc.) Series
1985B/ (AMBAC Insurance &
FNB Chicago SBPA)
4.05%, 07/07/95 1,000 1,000
New Hampshire State Housing
Finance Authority Multi
Family Housing Revenue
Bonds (Fairways Project)
Series 1994-1/ (General
Electric Capital Corp.
LOC)
4.25%, 07/07/95 7,000 7,000
----------
8,000
----------
NEW MEXICO--0.68%
Albuquerque, New Mexico
Gross Receipts Lodgers Tax
Exempt Adjustable Rate
Tender Revenue Bonds
Series 1994/ (Canadian
Imperial Bank of Commerce
LOC)
4.20%, 07/07/95 1,300 1,300
</TABLE>
<PAGE> 21
SchwabFunds(R) 9
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Belen, New Mexico
Industrial Development
Revenue Bonds
(Solo Cup, Inc. Project)/
(Wachovia Bank LOC)
4.15%, 07/07/95 $ 3,250 $ 3,250
New Mexico Educational
Assistance Foundation
Student Loan Revenue Bonds
Series 1992B/ (AMBAC
Insurance & International
Nederladen Bank SBPA)
4.35%, 07/07/95 18,200 18,200
----------
22,750
----------
NEW YORK--1.28%
New York City, New York
General Obligation Revenue
Bonds Series 1993B-2B/
(Dai-Ichi Kangyo Bank LOC)
4.55%, 07/01/95 1,800 1,800
New York City, New York
Housing Development Corp.
Variable Rate Demand
Bonds (East 96th Street
Project) Series 1990A/
(Mitsubishi Bank LOC)
3.75%, 07/07/95 2,000 2,000
New York City, New York
Industrial Development
Agency Industrial
Development Floating Rate
Revenue Bonds
(White Plains Auto)/
(Societe Generale LOC)
3.95%, 07/07/95 400 400
New York City, New York
Industrial Development
Agency Industrial
Development Revenue Bonds
(Japan Airlines) Series
1991/(Morgan Guaranty
Trust LOC)
4.15%, 07/01/95 800 800
New York City, New York
Trust for Cultural
Resources (Solomon R.
Guggenheim Project)
Revenue Bonds Series
1990B/(Swiss Bank LOC)
4.35%, 07/01/95 200 200
New York City, New York
Various Rate General
Obligation Bonds Series
1995B-B10/(Union Bank of
Switzerland LOC)
3.85%, 07/07/95 2,000 2,000
New York City, New York
Various Rate General
Obligation Bonds Series
1995B1-B8/ (Mitsubishi
Bank LOC)
3.95%, 07/07/95 2,000 2,000
New York Local Government
Assistance Corp. Public
Improvement Revenue Bonds
Series 1994B/ (Credit
Suisse LOC & Swiss Bank
LOC)
3.70%, 07/07/95 1,000 1,000
New York State Dormitory
Authority Various Projects
Revenue Bonds
(Masonic Hall Asylum)/
(AMBAC Insurance & Credit
Local de France LOC)
3.95%, 07/07/95 2,900 2,900
New York State Energy
Research & Development
Authority Electric
Facility Revenue Bonds
(Lilco Project) Series
1993B/
(Toronto-Dominion Bank LOC)
3.90%, 07/07/95 1,000 1,000
New York State Energy
Research & Development
Authority Pollution
Control Revenue Refunding
Bonds (Orange and Rockland
Utilities, Inc. Project)
Series 1994A/
(FGIC Insurance &
Societe Generale SBPA)
3.95%, 07/07/95 11,000 11,000
New York State Energy
Resource & Development
Authority Electric
Facility Revenue Bonds
(Lilco Project) Series
1993A/
(Toronto-Dominion Bank LOC)
4.10%, 07/07/95 1,000 1,000
New York State Housing
Finance Agency Variable
Rate Revenue Bonds
(Hospital Special Surgery
Staff) Series 1985A/
(Sakura Bank LOC)
4.00%, 07/07/95 5,400 5,400
New York State Job
Development Authority
State Guaranteed
Special Purpose Series A-1
through A-25/(State of
New York Guaranty &
Sumitomo Bank LOC)
4.20%, 07/01/95 450 450
Niagara Falls, New York
Bridge Commission Weekly
Adjustable/Fixed Rate
Revenue Bonds
(Toll Bridge System)/
(FGIC Insurance &
Industrial Bank of
Japan SBPA)
4.00%, 07/07/95 2,000 2,000
</TABLE>
<PAGE> 22
SchwabFunds(R) 10
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Triborough Bridge and
Tunnel
Authority, New York Special
Obligation Bridge Revenue
Bonds Series 1994/(FGIC
Insurance & FGIC SPA)
3.75%, 07/07/95 $ 7,500 $ 7,500
Yonkers, New York
Industrial Development
Authority Civic Facilities
Revenue Bonds
Consumers Union Facility/
(AMBAC Insurance & Credit
Local de France SBPA)
3.75%, 07/07/95 1,400 1,400
----------
42,850
----------
NORTH CAROLINA--1.55%
Charlotte, North Carolina
Airport Revenue Refunding
Bonds Series 1993A/ (MBIA
Insurance & Industrial
Bank of Japan SBPA)
4.20%, 07/07/95 6,500 6,500
North Carolina Medical Care
Community Hospital Revenue
Bonds (ACES Pooled
Financial Project)/ (MBIA
Insurance & Mitsubishi
Bank SBPA)
3.95%, 07/07/95 1,910 1,910
North Carolina Medical Care
Community Hospital Revenue
Bonds (Pooled Equipment
Finance Project)/(MBIA
Insurance &
Banque Paribas SBPA)
4.15%, 07/07/95 11,300 11,300
Wake County, North Carolina
Industrial Facility and
Pollution Control
Financing Authority
(Carolina Power &
Light) Series 1985B/
(Sumitomo Bank LOC)
4.10%, 07/07/95 2,900 2,900
Wake County, North Carolina
Industrial Facility and
Pollution Control
Financing Authority
(Carolina Power &
Light) Series 1985C/
(Sumitomo Bank LOC)
4.10%, 07/07/95 29,400 29,400
----------
52,010
----------
NORTH DAKOTA--0.20%
Mercer County, North Dakota
National Rural Utility
Pollution Control Revenue
Bonds (Basin Electric
Power Cooperative Antelope
Project) Series 1984C/
(N.R.U.--C.F.C. Guaranty)
4.30%, 07/07/95 7,200 7,200
----------
OHIO--1.04%
Columbus, Ohio Electric
System Revenue Bonds
Series 1984/(Dai-Ichi
Kangyo Bank LOC)
3.65%, 07/01/95 6,880 6,880
Columbus, Ohio
General Obligation
Bonds Series 1995-1/
(Westdeutsche Landesbank
LOC)
3.80%, 07/07/95 6,000 6,000
Dayton, Ohio Special
Facilities Revenue
Refunding Bonds
(Emery Air Freight)
Series 1993F/
(ABN-AMRO LOC)
4.10%, 07/07/95 8,000 8,000
Ohio Air Quality
Development Authority
Revenue Bonds (JMG
Funding, LP) Series 1994A/
(Societe Generale LOC)
4.05%, 07/07/95 12,000 12,000
Ohio Housing Finance Agency
Multi Family Housing
Revenue Bonds
(Kenwood Congregate
Retirement Community)
Series 1985/(Morgan
Guaranty Trust LOC)
3.90%, 07/01/95 2,000 2,000
----------
34,880
----------
OKLAHOMA--0.07%
Oklahoma City, Oklahoma
Industrial & Cultural
Facilities Trust Revenue
Bonds (ACES-SSM Health)
Series 1990A/(Industrial
Bank of Japan LOC)
4.45%, 07/07/95 1,300 1,300
Tulsa, Oklahoma Industrial
Development Authority
Hospital Revenue Bonds
(Hillcrest Medical Center)
Series 1988/ (Mitsubishi
Bank LOC)
4.00%, 07/07/95 685 685
Tulsa, Oklahoma Industrial
Development Revenue Bonds
(Thomas & Betts Project)
Series 1991/ (Wachovia
Bank LOC)
4.25%, 07/07/95 300 300
----------
2,285
----------
OREGON--1.38%
Medford, Oregon
Hospital Facility
Authority
(Rogue Valley Manor
Project) Series 1985/
(Banque Paribas LOC)
4.10%, 07/07/95 7,700 7,700
</TABLE>
<PAGE> 23
SchwabFunds(R) 11
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Oregon State Economic
Development Commission
Economic and Industrial
Development Revenue
Bonds/(Wachovia Bank LOC)
4.15%, 07/07/95 $ 4,100 $ 4,100
Oregon State General
Obligation Notes Series
1973F/ (Mitsubishi Bank
LOC)
4.45%, 07/07/95 11,185 11,185
Oregon State General
Obligation Notes Series
1973H/ (Bank of Tokyo LOC)
4.10%, 07/07/95 18,100 18,100
Port of Portland, Oregon
Industrial Development
Revenue Bonds (Schnitzer
Steel Project)/ (Comerica
Bank LOC)
4.00%, 07/07/95 5,000 5,000
----------
46,085
----------
PENNSYLVANIA--1.72%
Delaware County,
Pennsylvania Industrial
Development Authority
Solid Waste Revenue Bonds
(Scott Paper Co. Project)
Series C/ (Fuji Bank LOC)
4.20%, 07/07/95 2,000 2,000
Montgomery County,
Pennsylvania Industrial
Development Authority
Revenue Bonds (Seton
Medical Supply
Co. Project) / (Banque
Paribas LOC)
4.00%, 07/07/95 5,500 5,500
Pennsylvania Energy
Development Authority
Energy Development Revenue
Bonds (B & W Ebensberg
Project) Series 1986/
(Swiss Bank LOC)
4.35%, 07/07/95 13,450 13,450
Sayre, Pennsylvania Health
Care Facilities Authority
(VHA Capital Finance
Revenue) Series 1985B/
(AMBAC Insurance &
FNB Chicago SBPA)
3.95%, 07/07/95 4,365 4,365
Sayre, Pennsylvania Health
Care Facilities Authority
(VHA Capital Finance
Revenue) Series 1985F/
(AMBAC Insurance &
FNB Chicago SBPA)
3.95%, 07/07/95 3,100 3,100
Sayre, Pennsylvania Health
Care Facilities Authority
(VHA Capital Finance
Revenue) Series 1985J/
(AMBAC Insurance &
FNB Chicago SBPA)
3.95%, 07/07/95 9,800 9,800
Washington County,
Pennsylvania Authority
Revenue Bonds Higher
Education Pooled Equipment
Lease/ (Sanwa Bank LOC)
4.25%, 07/07/95 19,400 19,400
----------
57,615
----------
RHODE ISLAND--0.30%
Rhode Island State Student
Loan Authority Higher
Education Revenue Bonds
Series 1995-1/
(National Westminster LOC)
4.40%, 07/07/95 10,000 10,000
----------
SOUTH CAROLINA--0.35%
Cherokee County, South
Carolina Industrial
Revenue Bonds (Oshkosh
Truck Co. Project)/ (Bank
of Nova Scotia LOC)
4.25%, 07/07/95 4,400 4,400
Greenville County, South
Carolina Industrial
Development Revenue Bonds
(Quality Thermoforming
Project)/ (South Carolina
National Bank LOC)
4.25%, 07/07/95 1,300 1,300
South Carolina Jobs
Economic Development
Authority Industrial
Development Revenue Bonds
(Ado Corp. Project)/(South
Carolina National Bank
LOC)
4.25%, 07/07/95 1,200 1,200
Spartanburg County, South
Carolina Industrial
Development Authority
Revenue Bonds (Bemis,
Inc.)/
(Wachovia Bank LOC)
4.25%, 07/07/95 4,750 4,750
----------
11,650
----------
SOUTH DAKOTA--0.33%
Rapid City, South Dakota
Industrial Development
Revenue Corp. (Property
Associates 5)/ (Lloyds
Bank PLC LOC)
4.05%, 07/07/95 6,025 6,025
</TABLE>
<PAGE> 24
SchwabFunds(R) 12
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
South Dakota State Health
& Educational Facilities
Authority Revenue Bonds
(McKenna Hospital) Series
1994/
(MBIA Insurance &
Banque Paribas SBPA)
4.20%, 07/07/95 $ 5,000 $ 5,000
----------
11,025
----------
TENNESSEE--0.20%
Metropolitan Nashville and
Davidson County, Tennessee
Health and Education
Facility Board Revenue
Bonds Series A/
(FGIC Insurance & Barclays
Bank Line Of Credit)
4.00%, 07/07/95 1,400 1,400
Sullivan County, Tennessee
Industrial Development
Board Multi Family Rental
Housing (Brandymill I
Project) Series 1984/
(Firemans Fund Insurance
Co. Insurance)
4.25%, 07/01/95 5,195 5,195
----------
6,595
----------
TEXAS--6.47%
Amarillo, Texas Health
Facility Corp. Hospital
Revenue Bonds (High Plains
Baptist Hospital) Series
1985/ (Banque Paribas LOC)
3.85%, 07/07/95 9,300 9,300
Bexar County Health
Facilities Development
Corp. Revenue Bonds
(Chandler Memorial Home
Project) Series 1995/
(BancOne LOC)
4.20%, 07/07/95 5,170 5,170
Capital, Texas Industrial
Development Corp.
Industrial Development
Revenue Refunding Bonds
(The National Service
Industries, Inc.
Project)/(Wachovia
Bank LOC)
4.15%, 07/07/95 1,450 1,450
Euless, Texas Industrial
Development Authority
Revenue Bonds (Ferguson
Enterprises, Inc.)/
(Wachovia Bank LOC)
4.15%, 07/07/95 3,000 3,000
Greater East Texas Higher
Education Authority
Student Loan Revenue
Bonds Series 1993A/
(SLMA LOC)
4.20%, 07/07/95 48,150 48,150
Greater East Texas Higher
Education Authority
Student Loan Revenue
Bonds Series A/
(SLMA LOC)
4.15%, 07/07/95 16,000 16,000
Greater East Texas Higher
Education Authority
Student Loan Revenue
Bonds Series A/
(AMBAC Insurance &
Citibank SBPA)
4.15%, 07/07/95 18,300 18,300
Hays, Texas Memorial
Health Facilities
Development Corp.
Hospital Revenue Bonds
AHS/Sunbelt (Central
Texas Medical Center
Project) Series 1990A/
(Swiss Bank LOC)
4.00%, 07/07/95 9,200 9,200
Hays, Texas Memorial Health
Facilities Development
Corp. Hospital Revenue
Bonds AHS/Sunbelt (Central
Texas Medical Center
Project) Series 1990B/
(Swiss Bank LOC)
4.00%, 07/07/95 16,800 16,800
Lavaca-Navidad River
Authority, Texas Water
Supply System Contract
Revenue Bonds (Formosa
Plastics Corp. Project)/
(Canadian Imperial Bank of
Commerce LOC)
4.40%, 07/07/95 13,900 13,900
Lower Neches Valley
Authority, Texas
Industrial Development
Corp. Pollution Control
Revenue
Bonds (Mobil Corp. Neches
River Treatment Project)
Series 1994
4.00%, 07/07/95 12,000 12,000
Midlothian, Texas
Industrial Development
Corp. Pollution Control
Revenue Bonds (Box-Crow
Co. Project)/(Union Bank
of Switzerland LOC)
4.80%, 07/07/95 1,400 1,400
North Texas Higher
Education Loan
Authority, Inc.
(Student Loan Revenue)
Series 1987/ (Fuji Bank
LOC)
4.45%, 07/07/95 5,000 5,000
</TABLE>
<PAGE> 25
SchwabFunds(R) 13
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Panhandle Plains, Texas
Higher Education Loan
Authority, Inc. Student
Loan Revenue Bonds Series
1992A-1/ (SLMA LOC)
4.30%, 07/07/95 $ 5,000 $ 5,000
Panhandle Plains, Texas
Higher Education Loan
Authority, Inc. Student
Loan Revenue Bonds Series
1995A/ (SLMA LOC)
4.30%, 07/07/95 10,400 10,400
Port Authority of Corpus
Christi, Texas Nueces
County Marine Terminal
Revenue Bonds (Reynolds
Metals Co.)/ (Barclays
Bank LOC)
4.25%, 07/07/95 3,100 3,100
Texas Health Facilities
Development Corp.
Adjustable Convertible
Extendable Secondary ACES
Revenue Bonds (North Texas
Pooled Health) Series
1985B/ (Banque Paribas
LOC)
4.15%, 07/07/95 11,000 11,000
Texas Small Business
Industrial Development
Corp. Industrial
Development Revenue Bonds
(Texas Public Facility
Capital Access)/ (Multiple
Credit Enhancements)
4.30%, 07/07/95 24,595 24,595
Trinity River Authority,
Texas Pollution Control
Revenue Bonds (Lafarge
Corp. Project)/(Banque
Nationale de Paris LOC)
4.50%, 07/07/95 3,100 3,100
----------
216,865
----------
VERMONT--0.13%
Vermont Education and
Health Buildings Financing
Agency Revenue Bonds (VHA
New England) Series 1985G/
(AMBAC Insurance &
FNB Chicago SBPA)
4.05%, 07/07/95 4,240 4,240
----------
VIRGINIA--0.45%
Lynchburg, Virginia
Industrial Development
Authority Hospital
Facility
Revenue Bonds (First
Mortgage VHA Mid-Atlantic
States, Inc.)
Series 1985A/(AMBAC
Insurance & Mellon Bank
SBPA)
4.20%, 07/07/95 500 500
Lynchburg, Virginia
Industrial Development
Authority Hospital
Facility
Revenue Bonds (First
Mortgage VHA Mid-Atlantic
States, Inc.)
Series 1985B/(AMBAC
Insurance & Mellon Bank
SBPA)
4.20%, 07/07/95 400
Lynchburg, Virginia
Industrial Development
Authority Hospital
Facility
Revenue Bonds (First
Mortgage VHA Mid-Atlantic
States, Inc.) Series 1985C/
(AMBAC Insurance &
Mellon Bank SBPA)
4.20%, 07/07/95 600 600
Lynchburg, Virginia
Industrial Development
Authority Hospital
Facility
Revenue Bonds (First
Mortgage VHA Mid-Atlantic
States, Inc.) Series
1985F/
(AMBAC Insurance &
Mellon Bank SBPA)
4.20%, 07/07/95 5,600 5,600
Lynchburg, Virginia
Industrial Development
Authority Hospital
Facility
Revenue Bonds (First
Mortgage VHA Mid-Atlantic
States, Inc.)
Series 1985G/
(AMBAC Insurance &
Mellon Bank SBPA)
4.20%, 07/07/95 8,100 8,100
----------
15,200
----------
WASHINGTON--1.11%
Snohomish County,
Washington Public
Utilities District #1
Electric Revenue Bonds
(Generation Systems)/
(MBIA Insurance &
Industrial Bank of Japan
SBPA)
4.95%, 07/07/95 20,000 20,000
Washington State Health
Care Facilities Authority
Revenue Refunding Bonds
(Sisters of St. Joseph of
Peace) Series 1993/ (MBIA
Insurance & U.S. Bank of
Washington SBPA)
4.10%, 07/07/95 12,700 12,700
</TABLE>
<PAGE> 26
SchwabFunds(R) 14
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Washington State Housing
Finance Commission Multi
Family Mortgage Revenue
Bonds (Canyon Lake) Series
1993A/(U.S. Bank of
Washington LOC)
3.90%, 07/07/95 $ 4,565 $ 4,565
----------
37,265
----------
WEST VIRGINIA--0.32%
West Virginia State
Hospital Finance Authority
Hospital Revenue Bonds
(St. Joseph's
Hospital Project)
Series 1987/ (Mitsubishi
Bank LOC)
4.30%, 07/07/95 2,300 2,300
West Virginia State
Hospital Finance Authority
Hospital Revenue Bonds
(VHA Mid Atlantic States,
Inc.) Series 1985H/
(AMBAC Insurance &
FNB Chicago SBPA)
4.20%, 07/07/95 8,600 8,600
----------
10,900
----------
WISCONSIN--1.13%
Chilton, Wisconsin
Industrial Development
Revenue Refunding Bonds
(Kaytee Products, Inc.
Project) Series 1995/(Bank
One Milwaukee LOC)
4.35%, 07/07/95 1,865 1,865
Fairwater, Wisconsin Industrial
Development Revenue
Bonds (Dean Foods
Project) Series 1990/
(Wachovia Bank LOC)
4.15%, 07/07/95 1,450 1,450
Lac Du Flambeau Band of
Lake Superior Chippewa
Indian, Wisconsin Special
Obligation Bonds (Simpson
Electric) Series 1985/
(Barclays Bank LOC)
4.10%, 07/07/95 6,300 6,300
Milwaukee, Wisconsin
Redevelopment Authority
Industrial Development
Revenue Bonds (Field
Container Corp. LP) Series
1994/ (Northern Trust LOC)
4.35%, 07/07/95 5,000 5,000
Pewaukee, Wisconsin
Industrial Development
Revenue Authority (Husco
International Project)
Series 1992/(Bank One
Milwaukee LOC)
4.25%, 07/07/95 4,290 4,290
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Sheboygan, Wisconsin
Pollution Control
Financing Authority
Pollution Control
Revenue Bonds (Wisconsin
Power & Light Co.)
4.25%, 07/07/95 $ 1,000 $ 1,000
Wisconsin State Health and
Education Facilities
Authority Revenue Bonds
(ACES SSM Health Care
Project) Series 1990A/
(Industrial Bank of
Japan LOC)
4.45%, 07/07/95 3,700 3,700
Wisconsin State Health and
Education Facilities
Authority Revenue Bonds
(Sinai Samaritan) Series
1994A/ (Marshall &
Ilsley Bank LOC)
4.10%, 07/07/95 14,170 14,170
----------
37,775
----------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $1,833,345) 1,833,345
----------
VARIABLE RATE DEMAND NOTES--0.24%(a)
INDIANA--0.24%
Indiana State Housing
Finance Authority Single
Family Mortgage Housing
Revenue Bonds Series 1994C
4.00%, 07/01/96 3,500 3,500
Indiana State Housing
Finance Authority Single
Family Mortgage Housing
Revenue Bonds Series 1994D
3.90%, 07/01/96 4,700 4,700
----------
TOTAL VARIABLE RATE DEMAND NOTES
(Cost $8,200) 8,200
----------
VARIABLE RATE TENDER
OPTION BONDS--2.65%(a)
GEORGIA--0.63%
Georgia State Public
Improvement General
Obligation Tender Option
Bonds Series 1995B
(Citi-157)/
(Citibank Tender Option)
4.25%, 07/07/95 16,000 16,000
Metropolitan Atlanta Rapid
Transit Authority, Georgia
Sales Tax Revenue
Tender Option Bonds
Series M (BT-69)/
(AMBAC Insurance & Bankers
Trust Tender Option)
4.25%, 07/06/95 5,280 5,280
----------
21,280
----------
</TABLE>
<PAGE> 27
SchwabFunds(R) 15
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
NEVADA--0.75%
Nevada State General
Obligation Tender Option
Bonds (Colorado River
Community) Series 1994
(Citi-143)/ (Citibank
Tender Option)
4.30%, 07/07/95 $25,000 $ 25,000
----------
TEXAS--0.36%
Harris County, Texas
Toll Road Sub-Lien
Highway Tender Option
Bonds (Citi-138)/
(Citibank Tender Option)
4.30%, 07/07/95 7,000 7,000
Harris County, Texas
Toll Road Sub-Lien
Highway Tender Option
Bonds (Citi-139)/
(Citibank Tender Option)
4.30%, 07/07/95 5,000 5,000
----------
12,000
----------
WASHINGTON--0.91%
King County, Washington
Limited Tax General
Obligation Water & Sewer
Tender Option Bonds Series
1994A (Citi-136)/
(Citibank Tender Option)
4.30%, 07/07/95 15,570 15,570
King County, Washington
Limited Tax General
Obligation Water & Sewer
Tender Option Bonds Series
1994A (Citi-137)/
(Citibank Tender Option)
4.30%, 07/07/95 10,000 10,000
Washington State Public
Power Supply System
Nuclear Project Number 2
Revenue Tender Option
Bonds Series 1990C
(Citi-145)/
(FGIC Insurance,
Escrowed to Maturity with
Government Securities &
Citibank Tender Option)
4.30%, 07/07/95 5,000 5,000
----------
30,570
----------
TOTAL VARIABLE RATE TENDER OPTION
BONDS (Cost $88,850) 88,850
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
VARIABLE RATE TENDER
OPTION BOND
PARTNERSHIPS--4.38%(a)(e)
CONNECTICUT--0.22%
Connecticut State General
Obligation General Purpose
Public Improvement Tender
Option Bond Partnership
Series 1991A (BTP-151)/
(Bankers Trust Tender
Option)
4.20%, 07/07/95 $ 7,365 $ 7,365
----------
GEORGIA--0.46%
Georgia State Public
Improvement General
Obligation Tender Option
Bond Partnership Series
1993B & 1993C
(BTP-135)/(Bankers Trust
Tender Option)
4.20%, 07/07/95 3,865 3,865
Georgia State Public
Improvement General
Obligation Tender Option
Bond Partnership Series
1993B & 1993C
(BTP-140)/(Bankers Trust
Tender Option)
4.20%, 07/07/95 4,575 4,575
Georgia State Public
Improvement General
Obligation Tender
Option Bond Partnership
Series 1994B
(BTP-148)/(Bankers Trust
Tender Option)
4.20%, 07/07/95 7,100 7,100
----------
15,540
----------
ILLINOIS--0.45%
Chicago, Illinois
Metropolitan Water
Reclamation District
Greater Chicago General
Obligation Tender Option
Bond Partnership (Cook
County) (BTP-71)/
(Automated Data Processing
Tender Option)
4.30%, 07/07/95 9,870 9,870
Chicago, Illinois School
Finance Authority General
Obligation School Finance
Tender Option Bond
Partnership (BTP-70)/
(MBIA Insurance &
Automated Data Processing
Tender Option)
4.30%, 07/07/95 5,365 5,365
----------
15,235
----------
</TABLE>
<PAGE> 28
SchwabFunds(R) 16
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
MARYLAND--0.11%
Baltimore County, Maryland
General Obligation
Consolidated Public
Improvement Tender Option
Bond Partnership
Series 1991 (BTP-132)/
(Bankers Trust Tender
Option & Escrowed to
Maturity with Government
Securities)
4.20%, 07/07/95 $ 3,621 $ 3,621
----------
MINNESOTA--0.13%
Minnesota State Various
Purpose Sports Health Club
Tax Tender Option Bond
Partnership (BTP-65)/
(Automated Data
Processing Tender Option &
Escrowed to Maturity with
Government Securities)
4.30%, 07/07/95 4,455 4,455
----------
SOUTH CAROLINA--0.40%
Piedmont, South Carolina
Municipal Power Agency
Electric System Revenue
Tender Option Bond
Partnership Series 1986
(BTP-137)/(Bankers
Trust Tender Option &
Escrowed to Maturity with
Government Securities)
4.20%, 07/07/95 7,856 7,856
South Carolina State
Capital Improvement
Revenue Refunding Tender
Option Bond Partnership
(BTP-147)/(Bankers Trust
Tender Option)
4.20%, 07/07/95 5,370 5,370
----------
13,226
----------
TEXAS--1.07%
Regents of the University
of Texas Permanent University
Fund Revenue Tender Option
Bond Partnership
Series 1992A (BTP-145)/
(Permanent University
Fund Guaranty, Bankers
Trust Tender Option &
Escrowed to Maturity with
Government Securities)
4.20%, 07/07/95 10,685 10,685
Texas State General
Obligation General Purpose
Public Improvement Tender
Option Bond Partnership
Series 1993B/(BTP-116)
(Bankers Trust Tender
Option)
4.20%, 07/07/95 10,170 10,170
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Texas State Public Finance
Authority General
Obligation Tender Option
Bond Partnership Series
1994 (BTP-127)/
(Bankers Trust Tender
Option)
4.20%, 07/07/95 $14,980 $ 14,980
----------
35,835
----------
VIRGINIA--0.39%
Chesterfield County,
Virginia General
Obligation Public
Improvement and Refunding
Tender Option Bond
Partnership Series 1991
(BTP-136)/ (Bankers
Trust Tender Option)
4.20%, 07/07/95 6,025 6,025
Fairfax County, Virginia
Public Improvement
General Obligation Tender
Option Bond Partnership
Series 1991A (BTP-131)/
(Bankers Trust Tender
Option)
4.20%, 07/07/95 7,146 7,146
----------
13,171
----------
WASHINGTON--0.73%
King County, Washington
Limited Tax General
Obligation Tender Option
Bond Partnership Series
1993C (BTP-56)/ (Automated
Data Processing Tender
Option)
4.15%, 07/07/95 6,365 6,365
Washington State General
Obligation Tender Option
Bond Partnership Series
1990 (BTP-152)/ (Bankers
Trust Tender Option)
4.20%, 07/07/95 5,655 5,655
Washington State Public
Power Supply System
Nuclear Project Number 2
Revenue Refunding Tender
Option Bond Partnership
Series 1990C (BTP-130)/
(Bankers Trust
Tender Option)
4.25%, 07/07/95 5,740 5,740
Washington State Public
Power Supply System
Nuclear Project Number 2
Revenue Refunding Tender
Option Bond Partnership
Series 1993B (BTP-137)/
(Bankers Trust
Tender Option)
4.25%, 07/07/95 6,685 6,685
----------
24,445
----------
</TABLE>
<PAGE> 29
SchwabFunds(R) 17
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
WISCONSIN--0.42%
Wisconsin State Public
Improvement General
Obligation Tender Option
Bond Partnership
(BTP-62)/(Automated Data
Processing Tender Option &
Escrowed to Maturity with
Government Securities)
4.25%, 07/07/95 $ 4,500 $ 4,500
Wisconsin State Public
Improvement General
Obligation Tender Option
Bond Partnership Series
1992A (BTP-142)/ (Bankers
Trust Tender Option &
Escrowed to Maturity with
Government Securities)
4.20%, 07/07/95 9,480 9,480
----------
13,980
----------
TOTAL VARIABLE RATE TENDER OPTION
BOND PARTNERSHIPS
(Cost $146,873) 146,873
----------
BOND ANTICIPATION NOTES--0.23%(b)
NEW YORK--0.23%
Broome County, New York
Bond Anticipation Notes
Series 1995-96
4.33%, 04/19/96 3,000 3,015
Nassau County, New York
Bond Anticipation Notes
Series 1994E
4.10%, 08/15/95 4,800 4,804
----------
TOTAL BOND ANTICIPATION NOTES
(Cost $7,819) 7,819
----------
GENERAL OBLIGATIONS--1.11%(b)
CONNECTICUT--0.03%
Connecticut State General
Obligation Bonds Series
1992B
4.15%, 05/15/96 1,000 1,009
----------
GEORGIA--0.09%
Georgia State General
Obligation Bonds Series
1985F/ (Escrowed to
Maturity with
Government Securities)
4.26%, 07/01/95 3,000 3,090
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
MARYLAND--0.14%
Maryland State General
Obligation Bonds Unlimited
Tax Series 1991
3.75%, 10/15/95 $ 1,960 $ 1,967
Montgomery County, Maryland
Unlimited Tax General
Obligation Bonds
4.05%, 06/01/96 2,750 2,876
----------
4,843
----------
MASSACHUSETTS--0.25%
Massachusetts State
Dedicated Income Tax
Unlimited Tax General
Obligation Bonds Series
1990A/ (FGIC Insurance)
4.30%, 06/01/96 5,000 5,131
Massachusetts State
IBC General Obligation
Bonds Series 1990A/
(MBIA Insurance)
3.63%, 06/01/96 3,000 3,097
----------
8,228
----------
NEW MEXICO--0.19%
New Mexico State Capital
Projects Unlimited Tax
General Obligation Bonds
3.25%, 08/01/95 6,500 6,528
----------
TENNESSEE--0.17%
Memphis, Tennessee
Refunding General
Obligation Bonds
Series 1992
4.40%, 09/01/95 3,430 3,433
Tennessee State General
Obligation Bonds
Series 1995A
4.25%, 03/01/96 2,305 2,316
----------
5,749
----------
TEXAS--0.09%
Dallas County, Texas
Hospital District
Refunding General
Obligation Bonds
4.05%, 02/15/96 1,500 1,509
San Antonio, Texas
Limited General Obligation
Bonds Series 1985A/
(Escrowed to Maturity with
Government Securities)
4.30%, 08/01/95 1,000 1,004
----------
2,513
----------
VIRGINIA--0.08%
Norfolk, Virginia Unlimited
General Obligation Bonds/
(Escrowed to Maturity with
Government Securities)
3.75%, 06/01/96 2,495 2,618
----------
</TABLE>
<PAGE> 30
SchwabFunds(R) 18
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
WISCONSIN--0.07%
Wisconsin State General
Obligation Bonds
Series 1995A
3.65%, 05/01/96 $ 2,410 $ 2,465
----------
TOTAL GENERAL OBLIGATIONS
(Cost $37,043) 37,043
----------
MANDATORY PUT BONDS--5.35%(b)
CALIFORNIA--1.75%
California Higher
Educational Loan
Authority, Inc.
Student Loan Revenue
Bonds Series 1987C/
(SLMA LOC)
4.00%, 07/01/95 42,000 42,000
California Higher
Educational Loan
Authority, Inc.
Student Loan Revenue
Bonds Series 1992B/
(SLMA LOC)
3.90%, 07/01/95 5,000 5,000
California Higher
Educational Loan
Authority, Inc.
Student Loan Revenue
Bonds Series 1995 E-5/
(SLMA LOC)
4.25%, 06/01/96 11,700 11,700
----------
58,700
----------
FLORIDA--0.11%
Orange County, Florida
Industrial Development
Authority Industrial
Development Revenue Bonds
(General Accident
Insurance Co.
of America Project)
4.28%, 12/01/95 3,500 3,500
----------
KENTUCKY--0.05%
Calvert City, Kentucky
Industrial Development
Revenue Refunding
Bonds (SKW Alloys, Inc.
Lease Rent)
Series 87/(Bayerische
Vereinsbank LOC)
4.60%, 10/01/95 1,685 1,685
----------
OREGON--0.30%
Klamath Falls, Oregon
Electric Revenue Bonds
(Salt Caves Hydro
Electric) Series 1986E/
(Escrowed to Maturity with
Government Securities)
4.40%, 05/01/96 10,000 10,000
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
TEXAS--2.23%
Greater East Texas Higher
Education Authority Student
Loan Authority Student
Loan Revenue Bonds
Series 1992B/
(SLMA LOC)
4.00%, 07/01/95 $13,000 $ 13,000
Greater East Texas Higher
Education Authority Student
Loan Authority Student
Loan Revenue Bonds
Series 1993B-1/
(SLMA LOC)
4.20%, 07/07/95 11,000 11,000
Greater East Texas Higher
Education Authority Student
Loan Authority Student
Loan Revenue Bonds
Series 1993B-2/
(SLMA LOC)
4.10%, 06/01/96 6,500 6,500
Greater East Texas Higher
Education Authority Student
Loan Authority Student
Loan Secondary Lien
Series 1991A/
(SLMA LOC)
4.34%, 07/01/95 27,000 27,000
Panhandle Plains, Texas
Higher Education
Authority, Inc. Student
Loan Revenue Bonds Series
1992A/ (SLMA LOC)
4.30%, 07/07/95 2,300 2,300
Panhandle Plains, Texas
Higher Education
Authority, Inc. Student
Loan Revenue Bonds Series
1993A/ (SLMA LOC)
4.30%, 07/07/95 15,000 15,000
----------
74,800
----------
VIRGINIA--0.63%
Harrisonburg, Virginia
Redevelopment and
Housing Authority
Multi Family Housing
Revenue Bonds (Rolling
Brook Village Apts.)
Series 1985A/
(Guardian Savings &
Loan Assoc. LOC)
5.10%, 02/01/96 10,000 10,000
Virginia State Housing
Development Authority
Commonwealth Mortgage
Variable Rate Stem Series
B, Sub Series B
4.40%, 07/12/95 11,100 11,100
----------
21,100
----------
</TABLE>
<PAGE> 31
SchwabFunds(R) 19
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
WASHINGTON--0.28%
Washington State Housing
Finance Committee
Adjustable Single Family
Mandatory Put Bonds Series
1995-1A-S
4.10%, 06/01/96 $ 9,400 $ 9,400
----------
TOTAL MANDATORY PUT BONDS
(Cost $179,185) 179,185
----------
OPTIONAL PUT BONDS--2.76%(b)
FLORIDA--0.16%
Putnam County, Florida
Industrial Development
Authority Pollution
Control Revenue
Bonds (Seminole
Electric Corp.)
Series 1984H-3/
(N.R.U.--C.F.C. Guaranty)
4.30%, 09/15/95 5,425 5,425
----------
MISSOURI--1.78%
Missouri State
Environmental Improvement
and Energy Resources
Authority Pollution
Control Revenue Bonds
(Union Electric Co.)
Series 1985A/
(Swiss Bank LOC)
4.00%, 06/01/96 31,000 31,000
Missouri State
Environmental Improvement
and Energy Resources
Authority Pollution
Control Revenue Bonds
(Union Electric Co.)
Series 1985B/(Union Bank
of Switzerland LOC)
4.00%, 06/01/96 28,500 28,500
----------
59,500
----------
NEW HAMPSHIRE--0.09%
New Hampshire Higher
Education and Health
Facilities Authority
Revenue Bonds (Dartmouth
College) Series 1985A-G
4.10%, 06/01/96 3,000 3,000
----------
SOUTH CAROLINA--0.73%
York County, South Carolina
Pollution Control Revenue
Authority (North Carolina
Electric Project)
Series 1984N-6/
(N.R.U.--C.F.C. Guaranty)
4.30%, 09/15/95 24,575 24,575
----------
TOTAL OPTIONAL PUT BONDS
(Cost $92,500) 92,500
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
REVENUE ANTICIPATION NOTES--0.15%(b)
WISCONSIN--0.15%
Milwaukee, Wisconsin
Revenue Anticipation
Notes Series A
4.20%, 02/22/96 $ 5,000 $ 5,039
----------
TOTAL REVENUE ANTICIPATION
NOTES (Cost $5,039) 5,039
----------
REVENUE ANTICIPATION WARRANTS--1.21%(b)
CALIFORNIA--0.15%
California State Revenue
Anticipation Warrants
Series C/ (FGIC
Insurance)(d)
3.52%, 04/25/96 5,000 5,086
----------
IOWA--1.06%
Iowa School Corp. Warrant
Certificates Iowa School
Cash Anticipation Program
Series 1995A/(Capital
Guaranty Insurance Co.)
3.85%, 06/28/96 2,000 2,017
Iowa School Corp. Warrant
Certificates Iowa School
Cash Anticipation Program
Series 1995A/(Capital
Guaranty Insurance Co.)(d)
3.85%, 06/28/96 33,000 33,281
----------
35,298
----------
TOTAL REVENUE ANTICIPATION WARRANTS
(Cost $40,384) 40,384
----------
REVENUE BONDS--7.00%(b)
ARIZONA--0.25%
Salt River, Arizona
Project Agricultural
Improvement and Municipal
Power District Electrical
Systems Revenue
Bonds Series 1986C/
(Escrowed to Maturity with
Government Securities)
3.70%, 01/01/96 3,100 3,213
3.60%, 01/01/96 5,000 5,185
----------
8,398
----------
CALIFORNIA--0.06%
California State Department
Water Resources
(Central Valley Project)
Water System Revenue Bonds
Series 1993M
4.42%, 12/01/95 2,050 2,080
----------
</TABLE>
<PAGE> 32
SchwabFunds(R) 20
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
DELAWARE--0.17%
Delaware Transportation
Authority Fuel Tax Revenue
Bonds Series 1984/
(Escrowed to Maturity with
Government Securities)
4.55%, 07/01/95 $ 5,745 $ 5,860
----------
FLORIDA--0.42%
Jacksonville, Florida
Electric Authority Revenue
Refunding Bonds (St. Johns
River Power Project)
Series 1986-4A/
(Escrowed to Maturity with
Government Securities)
4.12%, 10/01/95 2,725 2,783
Jacksonville, Florida
Electric Authority Revenue
Refunding Bonds (St. Johns
River Power Project)
Series 1986-4B/
(Escrowed to Maturity with
Government Securities)
3.80%, 10/01/95 3,000 3,069
Orlando, Florida Utilities
Commission Water &
Electric Revenue Bonds/
(Escrowed to Maturity with
Government Securities)
4.20%, 10/01/95 8,000 8,243
----------
14,095
----------
ILLINOIS--0.88%
Illinois State Sales Tax
Revenue Bonds Series
1986B/ (Escrowed
to Maturity with
Government Securities)
4.00%, 06/15/96 3,500 3,685
Illinois State Toll Highway
Authority (Northern
Illinois Toll Highway)
Revenue Refunding Bonds
Series 1985/ (Escrowed
to Maturity with
Government Securities)
4.40%, 01/01/96 9,500 9,908
Illinois State Toll Highway
Authority Toll Highway
Priority Revenue Bonds/
(Escrowed to Maturity with
Government Securities)
4.00%, 01/01/96 1,000 1,035
Illinois State Toll Highway
Authority Toll Highway
Priority Revenue
Bonds Series 1996/
(Escrowed to Maturity with
Government Securities)
6.95%, 01/01/96 14,500 15,013
----------
29,641
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
INDIANA--0.37%
Indiana State Toll
Financing Authority Toll
Road Revenue Bonds/
(Escrowed to Maturity with
Government Securities)
4.25%, 07/01/95 $12,210 $ 12,454
----------
MINNESOTA--0.68%
Southern Minnesota Municipal
Power Agency Power
Supply System Revenue
Bonds/(MBIA Insurance &
Escrowed to Maturity
with Government
Securities)
3.44%, 01/01/96 1,000 1,049
Southern Minnesota Municipal
Power Agency Power
Supply System Revenue
Bonds Series 1985/
(Escrowed to Maturity with
Government Securities)
3.70%, 01/01/96 2,750 2,882
Southern Minnesota Municipal
Power Agency Power Supply
System Revenue Bonds
Series 1985C/ (Escrowed to
Maturity with Government
Securities)
4.05%, 01/01/96 2,000 2,087
Southern Minnesota Municipal
Power Agency Power
Supply System Revenue
Bonds Series 1986A/
(Escrowed to Maturity with
Government Securities)
3.44%, 01/01/96 5,760 5,962
Southern Minnesota Municipal
Power Agency Power
Supply System Revenue
Bonds Series 1986C/
(MBIA Insurance &
Escrowed to Maturity with
Government Securities)
4.40%, 01/01/96 9,955 10,304
----------
22,284
----------
NEW YORK--0.30%
Metropolitan Transportation
Authority, New York
Revenue Bonds Series
1986F/ (Escrowed
to Maturity with
Government Securities)
3.70%, 07/01/96 2,000 2,129
New York State Power
Authority Revenues &
General Purpose Power
Revenue Bonds Series
1986T/ (Escrowed
to Maturity with
Government Securities)
4.80%, 01/01/96 1,000 1,032
</TABLE>
<PAGE> 33
SchwabFunds(R) 21
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
New York State Urban
Development Corp.
Correctional Facilities
Revenue Bonds/
(Escrowed to Maturity with
Government Securities)
5.00%, 01/01/96 $ 4,485 $ 4,652
New York State Urban
Development Corp.
Correctional Facilities
Revenue Bonds Series
1986B/ (Escrowed
to Maturity with
Government Securities)
4.40%, 01/01/96 2,170 2,250
----------
10,063
----------
NORTH CAROLINA--0.82%
North Carolina Eastern
Municipal Power Agency
Power System Revenue Bonds
Series 1986A/ (Escrowed to
Maturity with Government
Securities)
3.70%, 01/01/96 3,400 3,568
North Carolina Municipal
Power Agency Revenue Bonds
(Catawba Electric Project)
Series 1985B/ (Escrowed to
Maturity with Government
Securities)
3.53%, 01/01/96 23,000 24,015
----------
27,583
----------
OHIO--0.32%
Trumbull County, Ohio
Hospital Revenue Bonds
(Trumbull Memorial
Hospital Project)/ (FGIC
Insurance & Escrowed to
Maturity with Government
Securities)
4.04%, 11/01/95 10,250 10,639
----------
SOUTH CAROLINA--0.32%
Piedmont, South Carolina
Municipal Power Agency
Electric System
Revenue Bonds/
(Escrowed to Maturity with
Government Securities)
4.10%, 01/01/96 5,000 5,283
3.70%, 01/01/96 5,000 5,293
----------
10,576
----------
TENNESSEE--0.18%
Metropolitan Nashville &
Davidson County, Tennessee
Water & Sewer Revenue
Bonds Series 1985B/
(Escrowed to Maturity with
Government Securities)
4.23%, 01/01/96 5,650 5,885
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
TEXAS--0.77%
Austin, Texas Utilities
System Revenue Bonds/
(Escrowed to Maturity with
Government Securities)
4.73%, 11/15/95 $ 2,180 $ 2,267
Houston, Texas
Water & Sewer System
Revenue Jr. Lien Bonds/
(Escrowed to Maturity with
Government Securities)
3.92%, 12/01/95 4,875 5,068
Houston, Texas Water &
Sewer System Revenue Jr.
Lien Refunding Bonds
Series 1991D/
(FGIC Insurance)
2.91%, 12/01/95 5,250 5,295
Lower Colorado River
Authority, Texas Revenue
Refunding Bonds/ (Escrowed
to Maturity with
Government Securities)
4.00%, 01/01/96 3,150 3,289
San Antonio, Texas
Electric & Gas Revenue
Bonds Series 1986A/
(Escrowed to Maturity with
Government Securities)
4.25%, 02/01/96 2,150 2,235
San Antonio, Texas
Electric & Gas Revenue
Bonds Series 1991A
4.25%, 02/01/96 3,000 3,030
Texas State Public Property
Financing Corp. Revenue
Refunding Bonds (Mental
Health and Retardation)/
(Capital Guaranty
Insurance)
3.80%, 09/01/95 4,770 4,773
----------
25,957
----------
UTAH--1.02%
Intermountain Power Agency,
Utah Power Supply Revenue
Bonds Series 1985A/
(AMBAC Insurance &
Escrowed to Maturity with
Government Securities)
4.32%, 07/01/95 5,650 5,791
Intermountain Power Agency,
Utah Power Supply Revenue
Bonds Series 1985D
4.20%, 07/01/95 500 500
Intermountain Power Agency,
Utah Power Supply Revenue
Bonds Series 1985H/
(Escrowed to Maturity with
Government Securities)
4.30%, 07/01/95 9,375 9,516
4.40%, 07/01/95 1,200 1,218
</TABLE>
<PAGE> 34
SchwabFunds(R) 22
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Intermountain Power Agency,
Utah Power Supply Revenue
Bonds Series 1985I/
(Escrowed to Maturity with
Government Securities)
4.25%, 07/01/95 $10,000 $ 10,150
Intermountain Power Agency,
Utah Power Supply Revenue
Bonds Series 1985J/
(MBIA Insurance &
Escrowed to Maturity with
Government Securities)
4.32%, 07/01/95 3,885 3,963
Intermountain Power Agency,
Utah Power Supply Revenue
Bonds Series 1992B
4.32%, 07/01/95 3,000 3,000
----------
34,138
----------
VIRGINIA--0.33%
Southeastern Public Service
Authority of Virginia
Regulated Solid Waste
System Series A/ (Escrowed
to Maturity with
Government Securities)
4.30%, 07/01/95 10,890 11,108
----------
WASHINGTON--0.11%
Seattle, Washington
Metropolitan Municipality
Sales Tax Revenue
Bonds Series 1986/
(Escrowed to Maturity with
Government Securities)
3.60%, 01/01/96 1,040 1,082
Seattle, Washington
Municipal Metropolitan
Seattle Sewer Revenue
Bonds Series 1988R/
(Escrowed to Maturity with
Government Securities)
3.70%, 01/01/96 1,000 1,039
Seattle, Washington
Municipal Metropolitan
Seattle Sewer Revenue
Bonds Series 1988R2/
(Escrowed to Maturity with
Government Securities)
3.70%, 01/01/96 1,650 1,715
----------
3,836
----------
TOTAL REVENUE BONDS (Cost $234,597)
234,597
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
TAX ANTICIPATION
NOTES--1.38%(b)
GEORGIA--0.35%
Dekalb County, Georgia
Tax Anticipation Notes
Series 1995
4.25%, 12/29/95 $11,350 $ 11,391
4.00%, 12/29/95 500 502
----------
11,893
----------
OREGON--0.32%
Multnomah County, Oregon
School District Number 1J
Portland Tax Anticipation
Notes(d)
3.65%, 05/30/96 10,500 10,601
----------
TEXAS--0.71%
Texas Association of School
Boards Certificates of
Participation Tax
Anticipation Notes Series
1994A/(Capital
Guaranty Insurance &
Sanwa Bank LOC)
4.15%, 08/31/95 22,620 22,642
4.10%, 08/31/95 1,000 1,001
----------
23,643
----------
TOTAL TAX ANTICIPATION NOTES (Cost
$46,137) 46,137
----------
TAX AND REVENUE ANTICIPATION
NOTES--9.25%(b)
CALIFORNIA--8.41%
California School Cash
Reserve Program Authority
Pooled Tax and Revenue
Anticipation Notes
Series 1994A
3.75%, 07/05/95 50,000 50,004
California School Cash
Reserve Program Authority
Pooled Tax and Revenue
Anticipation Notes Series
1995A/ (MBIA Insurance)(d)
3.75%, 07/03/96 60,000 60,575
East Side Unified High School
District, California Tax and
Revenue Anticipation Notes
Series 1994
4.10%, 10/26/95 8,000
Kern, California High
School District Tax and
Revenue Anticipation Notes
4.20%, 08/10/95 20,000 20,017
Los Angeles County,
California Tax and Revenue
Anticipation Notes Series
1995/1996/ (Multiple
Credit Enhancements)(d)
3.80%, 07/01/96 42,000 42,281
</TABLE>
<PAGE> 35
SchwabFunds(R) 23
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
Los Rios, California
Community College District
Tax and Revenue Anticipation
Notes Series 1994
4.14%, 09/29/95 $12,000 $ 12,017
Orange County, California
Pooled Tax and Revenue
Anticipation Notes Primary
and Secondary Education
Series 1994-95(c)
3.70%, 07/28/95 74,160 74,202
Sacramento, California
Unified School District
Tax and Revenue
Anticipation Notes
Series 1994-95
4.30%, 11/10/95 9,500 9,523
Santa Rosa, California
High School District Tax
and Revenue Anticipation
Notes Series 1994-95
4.25%, 11/10/95 5,000 5,013
----------
281,654
----------
NEW YORK--0.17%
Half Hollow Hills
Huntington-Babylon
Consolidated School
District Suffolk County
Tax and Revenue
Anticipation Notes(d)
3.70%, 06/28/96 5,800 5,830
----------
TEXAS--0.53%
Irvine, Texas Independent
School District Tax and
Revenue Anticipation Notes
Primary and Secondary
Education Series 1994-95
4.02%, 08/31/95 1,535 1,537
Texas State Tax and Revenue
Anticipation Notes
Series 1994/1995 A
3.09%, 08/31/95 5,000 5,014
Texas State Tax and Revenue
Anticipation Notes
Series Oct. 1995
3.41%, 08/31/95 11,000 11,028
----------
17,579
----------
WISCONSIN--0.14%
Appleton, Wisconsin
Area School District Tax
and Revenue Anticipation
Promissory Notes Series
1994-95
4.35%, 09/29/95 4,750 4,754
----------
TOTAL TAX AND REVENUE ANTICIPATION
NOTES (Cost $309,817) 309,817
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
TAX-EXEMPT COMMERCIAL
PAPER--9.57%(b)
ARIZONA--1.01%
Maricopa County, Arizona
Pollution Control
Financing Authority
Pollution Control Revenue
Bonds (Southern California
Edison Co. Palo Verde
Project) Series 1985B
4.20%, 07/26/95 $ 4,200 $ 4,200
4.25%, 08/24/95 4,250 4,250
4.05%, 08/24/95 1,500 1,500
Maricopa County, Arizona
Pollution Control
Financing Authority
Pollution Control Revenue
Bonds (Southern California
Edison Co. Palo Verde
Project) Series 1985C
4.25%, 08/24/95 3,100 3,100
4.15%, 09/11/95 6,450 6,450
3.15%, 10/10/95 6,250 6,250
Maricopa County, Arizona
Pollution Control
Financing Authority
Pollution Control
Revenue Bonds (Southern
California Edison Co.
Palo Verde Project)
Series 1985G
4.15%, 07/13/95 5,500 5,500
4.05%, 07/13/95 2,700 2,700
----------
33,950
----------
CALIFORNIA--0.18%
Los Angeles County,
California Transportation
Commission Second
Subordinate Sales Tax
Revenue Bonds Series A/
(Multiple Credit
Enhancements)
3.25%, 08/18/95 6,100 6,100
----------
COLORADO--1.21%
Denver, Colorado
City and County Airport
System Revenue Bonds
(Denver International
Airport) Series 1990C/
(Sumitomo Bank LOC)(d)
4.01%, 07/24/95 13,000 13,001
Platte River, Colorado
Power Authority Adjustable
Tender Electric Revenue
Secondary Lien Bonds
Series S-1/(Morgan
Guaranty Trust SBPA)
4.00%, 07/20/95 5,600 5,600
4.15%, 07/26/95 2,600 2,600
4.20%, 08/24/95 5,500 5,500
3.10%, 10/10/95 13,800 13,800
----------
40,501
----------
</TABLE>
<PAGE> 36
SchwabFunds(R) 24
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
GEORGIA--1.33%
Burke County, Georgia
Development Authority
Pollution Control Revenue
Bonds (Oglethorpe Power
Project) 1st Series 1989/
(Credit Suisse LOC)
4.20%, 07/13/95 $10,200 $ 10,200
4.15%, 08/21/95 3,000 3,000
4.20%, 08/24/95 4,400 4,400
4.15%, 09/12/95 22,700 22,700
3.20%, 10/10/95 4,300 4,300
----------
44,600
----------
ILLINOIS--0.15%
Chicago, Illinois Tender
Notes Limited General
Purpose Public Improvement
Series 1994A2/(Union Bank
of Switzerland LOC)
4.15%, 07/19/95 5,000 5,000
----------
KANSAS--0.43%
Burlington, Kansas
Pollution Control Revenue
Refunding Bonds (Kansas
City Power & Light)
Series 1987A/
(Toronto-Dominion Bank LOC)
4.20%, 08/21/95 12,150 12,150
Burlington, Kansas
Pollution Control Revenue
Refunding Bonds (Kansas
City Power & Light) Series
1987B/ (Deutsche Bank LOC)
4.15%, 08/07/95 2,200 2,200
----------
14,350
----------
KENTUCKY--0.07%
Pendleton County, Kentucky
Multiple County Lease
Revenue Bonds (Kentucky
Association of Counties
Lease Program) Series
1989/ (Commonwealth Bank
of Australia LOC)
4.05%, 07/25/95 2,300 2,300
----------
LOUISIANA--1.40%
Louisiana State Adjustable
Tender Refunding Bonds
Series 1991A/(Credit Local
de France & Fuji Bank LOC)
3.75%, 08/03/95 7,600 7,600
3.60%, 08/09/95 4,275 4,275
St. James Parish, Louisiana
Pollution Control Revenue
Bonds (Texaco Project)
Series 1988B
4.20%, 08/08/95 30,000 30,000
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
West Baton Rouge Parish,
Louisiana Industrial
District Number 3
Adjustable Tender
Pollution Control Revenue
Refunding Bonds
(Dow Chemical Corp.)
3.85%, 07/11/95 $ 1,000 $ 1,000
West Baton Rouge Parish,
Louisiana Industrial
District Number 3
Adjustable Tender
Pollution Control Revenue
Refunding Bonds
(Dow Chemical Corp.)
Series 1987
3.85%, 07/11/95 4,050 4,050
----------
46,925
----------
MINNESOTA--0.34%
Rochester, Minnesota
Adjustable Tender Health
Care Facility Revenue
Bonds (Mayo Foundation/
Mayo Medical Center)
Series 1988F/
(Credit Suisse SBPA)
3.90%, 07/20/95 5,100 5,100
4.15%, 07/26/95 3,250 3,250
Rochester, Minnesota
Adjustable Tender Health
Care Facility Revenue
Bonds (Mayo Foundation/
Mayo Medical Center)
Series 1992A
4.15%, 08/21/95 3,000 3,000
----------
11,350
----------
NORTH CAROLINA--1.94%
North Carolina Eastern
Municipal Power Agency
Power System Revenue
Bonds/(Industrial Bank of
Japan LOC)
4.25%, 07/06/95 11,000 11,000
4.15%, 07/06/95 7,321 7,321
3.70%, 08/03/95 6,000 6,000
3.50%, 08/09/95 10,076 10,076
3.10%, 08/10/95 11,244 11,242
North Carolina Eastern
Municipal Power Agency
Power System Revenue Bonds
Series 1988B/
(Union Bank of Switzerland &
Morgan Guaranty
Trust LOC)
3.80%, 09/05/95 9,500 9,500
3.95%, 09/07/95 5,000 5,000
3.45%, 10/05/95 4,900 4,900
----------
65,039
----------
</TABLE>
<PAGE> 37
SchwabFunds(R) 25
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
PENNSYLVANIA--0.49%
Delaware County,
Pennsylvania Industrial
Development Authority
Pollution Control Variable
Rate Refunding Bonds
(Philadelphia Electric)
Series 1988A/(FGIC
Insurance & FGIC SPA)
3.95%, 07/25/95 $ 6,300 $ 6,300
Montgomery County,
Pennsylvania Industrial
Development Authority
Pollution Control
Revenue Bonds/ (Deutsche
Bank LOC)
4.15%, 07/13/95 10,000 10,000
----------
16,300
----------
TEXAS--0.81%
Texas Municipal Power
Agency Revenue Bonds/
(Canadian Imperial Bank of
Commerce & Morgan Guaranty
Trust LOC)
3.60%, 08/18/95 27,150 27,150
----------
<CAPTION>
Par Value
------- ----------
<S> <C> <C>
WYOMING--0.21%
Lincoln County, Wyoming
Pollution Control
Financing Authority
Pollution Control
Revenue Flexible Refunding
Bonds (PacifiCorp Project)
Series 1991/(Union Bank
of Switzerland LOC)
4.20%, 08/24/95 $ 7,100 $ 7,100
----------
TOTAL TAX-EXEMPT COMMERCIAL PAPER
(Cost $320,665)
320,665
----------
TOTAL INVESTMENTS--100.0%
(Cost $3,350,454) $3,350,454
============
</TABLE>
NOTES TO SCHEDULE OF INVESTMENTS.
For each security, cost (for financial reporting and federal income tax
purposes) and carrying value are the same.
(a) Variable rate securities. Interest rates vary periodically based on
current market rates. Rates shown are the effective rates on June 30, 1995.
Dates shown represent the latter of the demand date or next interest rate
change date, which is considered the maturity date for financial reporting
purposes. For variable rate securities without demand features the next
interest reset date is shown.
(b) Interest rates represent effective yield to put or call date at time of
purchase.
(c) As of June 30, 1995, the Fund was the beneficiary under an $18,540,000
irrevocable letter of credit issued by Bank of America National Trust and
Savings Association which permitted the Fund to make a demand for partial
payment of this security's principal amount under certain conditions upon
maturity or disposition of this security by the Fund. Subsequent to June
30, 1995, this security matured and was paid in full and the letter of
credit expired.
(d) Security traded on a delayed-delivery basis. Payment and delivery is
scheduled for a future time, generally within two weeks of entering into
the transaction. The transaction is subject to market fluctuation and to
the risk that the value may be more or less than the purchase price when
the transaction was entered into. The Fund has set aside sufficient
investment securities as collateral for securities purchased on a
delayed-delivery basis.
<PAGE> 38
SchwabFunds(R) 26
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
SCHEDULE OF INVESTMENTS (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
(e) Certain securities purchased by the Fund are private placement
securities exempt from registration by Section 4(2) of the Securities Act
of 1933. These securities generally are issued to institutional investors,
such as the Schwab Tax-Exempt Money Fund. Any resale by the Fund must be in
an exempt transaction, normally to a qualified institutional buyer. At June
30, 1995, the aggregate value of private placement securities held by the
Fund was $146,873,000, which represented 4.62% of net assets. All of these
private placement investments were determined by the Investment Manager to
be liquid in accordance with a resolution adopted by the Board of Trustees
relating to Rule 144A, promulgated under the Securities Act of 1933.
<TABLE>
<CAPTION>
Abbreviations
---------------
<S> <C>
AMBAC AMBAC Indemnity Corporation
ABN-AMRO Algemene Bank of the Netherlands/Amsterdam-Rotterdam
FGIC Financial Guaranty Insurance Company
FHLB Federal Home Loan Bank
FNB First National Bank
FSA Financial Security Assurance
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance Corporation
N.R.U.-C.F.C. National Rural Utilities Cooperative Financing
Corporation
SBPA Standby Purchase Agreement
SLMA Student Loan Marketing Association
SPA Securities Purchase Agreement
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE> 39
SchwabFunds(R) 27
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES (in thousands)
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments, at value (Cost: $3,350,454) $3,350,454
Cash 94
Interest receivable 34,270
Receivable for securities sold 16,987
Prepaid expenses 90
----------
Total assets 3,401,895
----------
LIABILITIES
Payable for:
Dividends 4,527
Investments purchased 213,970
Investment advisory and administration fee 519
Transfer agency and shareholder service fees 1,095
Other 197
----------
Total liabilities 220,308
----------
Net assets applicable to outstanding shares $3,181,587
==========
NET ASSETS CONSIST OF:
Capital paid in $3,183,369
Accumulated net realized loss on investments sold (1,782)
----------
$3,181,587
==========
THE PRICING OF SHARES
Outstanding shares, $0.00001 par value
(unlimited shares authorized) 3,183,369
Net asset value, offering and redemption
price per share $1.00
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE> 40
SchwabFunds(R) 28
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
STATEMENT OF OPERATIONS (in thousands)
For the six months ended June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
Interest income $60,882
-------
Expenses:
Investment advisory and administration fee 6,501
Transfer agency and shareholder service fees 6,923
Custodian fees 179
Registration fees 121
Professional fees 49
Shareholder reports 98
Trustees' fees 8
Amortization of deferred organization costs and
other prepaid expenses 65
Insurance and other expenses 88
-------
14,032
Less expenses reduced (3,878)
-------
Total expenses incurred by Fund 10,154
-------
Net investment income 50,728
Net realized gain on investments sold 45
-------
Increase in net assets resulting from operations $50,773
=======
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE> 41
SchwabFunds(R) 29
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
STATEMENT OF CHANGES IN NET ASSETS (in thousands)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the six For the
months ended year ended
June 30, 1995 December 31,
(Unaudited) 1994
------------- ------------
<S> <C> <C>
Operations:
Net investment income $ 50,728 $ 65,678
Net realized gain (loss) on
investments sold 45 (1,586)
---------- ----------
Increase in net assets resulting
from operations 50,773 64,092
---------- ----------
Dividends to shareholders from
net investment income (50,728) (65,678)
---------- ----------
Capital Share Transactions (dollar amounts
and number of shares are the same):
Proceeds from shares sold 4,891,284 8,184,151
Net asset value of shares issued in
reinvestment of dividends 57,259 57,664
Less payments for shares redeemed (4,782,952) (7,647,595)
---------- ----------
Increase in net assets from capital
share transactions 165,591 594,220
---------- ----------
Total increase in net assets 165,636 592,634
Net Assets:
Beginning of period 3,015,951 2,423,317
---------- ----------
End of period $ 3,181,587 $ 3,015,951
========== ==========
</TABLE>
See accompanying Notes to Financial Statements.
<PAGE> 42
SchwabFunds(R) 30
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
NOTES TO FINANCIAL STATEMENTS
For the six months ended June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
1. DESCRIPTION OF THE FUND
The Schwab Tax-Exempt Money Fund (the "Fund") is a series of The Charles Schwab
Family of Funds (the "Trust"), an open-end, management investment company
organized as a Massachusetts business trust on October 20, 1989 and registered
under the Investment Company Act of 1940, as amended.
On May 9, 1995, the Board of Trustees of the Trust adopted a multiple class plan
for the Fund. On July 7, 1995, the Fund began offering more than one class of
shares. Pursuant to the plan, the existing shares were redesignated as Sweep
Shares, and a new class of shares was added -- the Value Advantage Shares. Both
classes represent interests in the same portfolio of investments of the Fund and
are substantially the same in all respects except that the shares are subject to
different transfer agency and shareholder service fees, investment minimums and
certain other expenses.
In addition to the Fund, the Trust also offers -- the Schwab Money Market Fund,
the Schwab Government Money Fund, the Schwab U.S. Treasury Money Fund, the
Schwab California Tax-Exempt Money Fund, the Schwab Value Advantage Money
Fund(R), the Schwab Institutional Advantage Money Fund(TM), the Schwab
Retirement Money Fund(TM) and the Schwab New York Tax-Exempt Money Fund. The
assets of each series are segregated and accounted for separately.
The Schwab Tax-Exempt Money Fund invests in a diversified portfolio of
short-term high quality municipal securities.
2. SIGNIFICANT ACCOUNTING POLICIES
Security valuation -- Investments are stated at amortized cost which
approximates market value.
Security transactions and interest income -- Security transactions, in the
accompanying financial statements, are accounted for on a trade date basis (date
the order to buy or sell is executed). Interest income is recorded on the
accrual basis and includes amortization of premium on investments. Realized
gains and losses from security transactions are determined on an identified cost
basis.
Dividends to shareholders -- The Fund declares a daily dividend, equal to its
net investment income for that day, payable monthly.
Deferred organization costs -- Costs incurred in connection with the
organization of the Fund, its initial registration with the Securities and
Exchange Commission and with various states are amortized on a straight-line
basis over a five year period from the Fund's commencement of operations.
Expenses -- Expenses arising in connection with the Fund are charged directly to
the Fund. Expenses common to all series of the Trust are allocated to each
series in proportion to their relative net assets.
<PAGE> 43
SchwabFunds(R) 31
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Federal income taxes -- It is the Fund's policy to meet the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its net investment income and realized net capital gains, if
any, to shareholders. Therefore, no federal income tax provision is required.
The Fund is considered a separate entity for tax purposes.
3. TRANSACTIONS WITH AFFILIATES
Investment advisory and administration agreements -- The Trust has investment
advisory and administration agreements with Charles Schwab Investment
Management, Inc. (the "Investment Manager"). For advisory services and
facilities furnished, the Fund pays an annual fee, payable monthly, of .46% of
the first $1 billion of average daily net assets, .41% of such assets over $1
billion, and .40% of such assets in excess of $2 billion. Under these
agreements, the Fund incurred investment advisory and administration fees of
$6,501,000 during the six months ended June 30, 1995, before the Investment
Manager reduced its fee (see Note 4).
Transfer agency and shareholder service agreements -- The Trust has transfer
agency and shareholder service agreements with Charles Schwab & Co., Inc.
("Schwab"). For services provided under these agreements, Schwab receives an
annual fee, payable monthly, of .45% of average daily net assets. For the six
months ended June 30, 1995, the Fund incurred transfer agency and shareholder
service fees of $6,923,000, before Schwab reduced its fees (see Note 4).
Officers and trustees -- Certain officers and trustees of the Trust are also
officers or directors of the Investment Manager and/or Schwab. During the six
months ended June 30, 1995, the Trust made no direct payments to its officers or
trustees who are "interested persons" within the meaning of the Investment
Company Act of 1940, as amended. The Fund incurred fees of $8,000 related to the
Trust's unaffiliated trustees.
4. EXPENSES REDUCED BY THE INVESTMENT MANAGER AND SCHWAB
The Investment Manager and Schwab reduced a portion of their fees in order to
limit the Fund's ratio of operating expenses to average net assets. For the six
months ended June 30, 1995, the total of such fees reduced by the Investment
Manager and Schwab was $3,424,000 and $454,000, respectively.
5. INVESTMENT TRANSACTIONS
Purchases, sales and maturities of investment securities during the six months
ended June 30, 1995, aggregated (in thousands) $2,972,311 and $2,657,899,
respectively.
<PAGE> 44
SchwabFunds(R) 32
--------------------------------------------------------------------------------
SCHWAB TAX-EXEMPT MONEY FUND
NOTES TO FINANCIAL STATEMENTS
For the six months ended June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
6. FINANCIAL HIGHLIGHTS
Per share income and capital changes for a share outstanding throughout the
period:
<TABLE>
<CAPTION>
For the period
January 26, 1990
(commencement
For the six of operations)
months ended to
June 30, 1995 For the year ended December 31, December 31,
(Unaudited) 1994 1993 1992 1991 1990
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment
----------------------
Operations
----------
Net investment income .02 .02 .02 .03 .04 .05
Net realized and unrealized
gain (loss) on investments -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total from investment
operations .02 .02 .02 .03 .04 .05
Less Distributions
------------------
Dividends from net
investment income (.02) (.02) (.02) (.03) (.04) (.05)
Distributions from realized
gain on investments -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions (.02) (.02) (.02) (.03) (.04) (.05)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at
end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
========== ========== ========== ========== ========== ==========
Total return (%) 1.65 2.32 1.93 2.49 4.01 5.08
----------------
Ratios/Supplemental Data
------------------------
Net assets, end of
period (000s) $ 3,181,587 $3,015,951 $2,423,317 $1,744,903 $1,359,121 $1,185,974
Ratio of expenses to
average net assets (%) .66* .65 .63 .63 .63 .63*
Ratio of net investment
income to average
net assets (%) 3.30* 2.31 1.92 2.45 3.91 5.33*
</TABLE>
The Investment Manager and Schwab have reduced a portion of their fees and
absorbed certain expenses in order to limit the Fund's ratio of operating
expenses to average net assets. Had these fees and expenses not been reduced and
absorbed, the ratio of expenses to average net assets for the periods ended June
30, 1995, December 31, 1994, 1993, 1992, 1991 and 1990 would have been .91%*,
.91%, .93%, .94%, .95% and .95%*, respectively, and the ratio of net investment
income to average net assets would have been 3.05%*, 2.05%, 1.62%, 2.14%, 3.59%
and 5.01%*, respectively.
* Annualized
<PAGE> 45
CAPTURING GROWTH OPPORTUNITIES DOESN'T HAVE TO BE GUESSWORK.
Large-cap stocks, small-cap stocks, or international stocks? It's difficult to
predict which stock market segment will come out ahead during given time
periods, especially since these markets do not always move in tandem. While one
market segment may be experiencing only moderate growth, others, at the same
time, may be expanding rapidly.
SchwabFunds(R) three equity index funds help you take some of the guesswork out
of equity investing. These Funds provide a way for you to put the growth
potential of all three markets into your portfolio -- rather than relying on
just one market. The Funds offer an easy and efficient way to achieve a broad
level of effective equity diversification. In fact, they provide market
coverage that could require investments in many more funds.
SCHWAB 1000 FUND(R) is designed to match the total return of the
[FIGURE 1] Schwab 1000 Index(R), which is comprised of the largest 1,000
publicly traded U.S. companies -- the stocks of which represent
about 91% of the total market capitalization of the U.S. stock
market. 1
SCHWAB SMALL-CAP INDEX FUND(TM) is designed to track the total
[FIGURE 2] return of the Schwab Small-Cap Index(TM), which tracks the
performance of smaller-capitalization companies. The Schwab
Small-Cap Index is comprised of the second 1,000 largest publicly
traded companies in the U.S. 1
SCHWAB INTERNATIONAL INDEX FUND(TM) is designed to track the total
[FIGURE 3] return of the Schwab International Index,(TM) which is comprised
of 350 of the largest companies, based on market capitalization,
in foreign countries with developed securities markets. 2
You can begin building your diversified equity investment portfolio with the
three SchwabFunds equity index funds by calling Schwab at the toll-free number
below, or by sending back the enclosed postcard. We'll be happy to provide you
with a free prospectus and brochure for the Funds.
EACH PROSPECTUS PROVIDES MORE COMPLETE INFORMATION, INCLUDING CHARGES AND
EXPENSES. PLEASE READ IT CAREFULLY BEFORE INVESTING.
--------------------------------------------------------------------------------
SCHWAB'S FUNDMAP(TM) SOFTWARE MAKES FUND
SELECTION EASIER.
FundMap Mutual Fund Selection Software for Windows(R) allows you to calculate
your long-term investment needs and can help you to decide how much you may need
to invest in each of the three SchwabFunds equity index funds. 3 You can explore
ways to allocate your assets, even re-evaluate your current strategy and set up
several "what if" scenarios. SchwabFunds and FundMap make it easy for you to
build a diversified portfolio today.
--------------------------------------------------------------------------------
1-800-2 NO-LOAD
1-800-266-5623
1 Each Index consists of publicly traded companies ranked by market
capitalization. Each Index does not include privately held companies,
investment companies and companies incorporated outside of the United
States.
2 The Index is comprised of publicly traded companies ranked by market
capitalization in countries with developed securities markets around the
world. It does not include privately held companies, investment companies,
or companies from the United States.
3 FundMap is available for Schwab customers only. Please allow 2-4 weeks for
delivery.
Windows is a registered trademark of Microsoft Corporation.
<PAGE> 46
--------------
BULK RATE
U.S. POSTAGE
PAID
CHARLES SCHWAB
--------------
[SCHWABFUNDS FAMILY(TM) LOGO]
101 Montgomery Street
San Francisco, California 94104
INVESTMENT ADVISER
Charles Schwab Investment Management, Inc.
101 Montgomery Street, San Francisco, CA 94104
DISTRIBUTOR
Charles Schwab & Co., Inc.
101 Montgomery Street, San Francisco, CA 94104
This report is not authorized for distribution to prospective
investors unless preceded or accompanied by a current prospectus.
CRS 3850 TF3632R (8/95) Printed on recycled paper.
