PRUDENTIAL SHORT TERM GLOBAL INCOME FUND INC, N-30D, 1994-01-14

PRUDENTIAL SHORT TERM GLOBAL INCOME FUND INC
N-30D, 1994-01-14

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Prudential
Short-Term Global
Income Fund, Inc.
Global Assets Portfolio
- ------------------------------------------------
Prudential Mutual Funds
BUILDING YOUR FUTURE
(LOGO)
ON OUR STRENGTH
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LETTER TO
SHAREHOLDERS

December 13, 1993

Over the past year, the Prudential Short-Term Global Income Fund/Global
Assets Portfolio was able to circumvent much of the volatility that
continued in the global fixed income and currency markets.

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Total Returns

Historical* Average Annual**
As of October 31 As of September 30

1-Year Since 11/1/90 1-Year Since 11/1/90
<S> <C> <C> <C> <C>
Class A 4.36% 12.15% 3.45% 4.30%
Class B 5.47% 12.34% 5.08% 4.36%+

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*Source: Prudential Mutual Fund Management, Inc. Returns are historical
and do not guarantee future performance. Investment return and principal
value will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than
their original value. These figures do not take into account sales charges.
The Fund charges a maximum sales load of .99% for Class A shares. Class B
shares are subject to a declining contingent deferred sales charge (CDSC)
of 1% for the first
year. Class B shares will automatically convert to Class A shares
after the 1-year CDSC period has expired.

**Source: Prudential Mutual Fund Management, Inc. These averages
take into account sales charges.

+This number does not reflect the conversion of Class B shares to
Class A shares that occurs after the 1-year CDSC period has expired.

The Prudential Global Assets Portfolio net asset value on October
31, 1993, was $1.88 for Class A shares and $1.90 for Class B shares.
The Fund also paid distributions of $0.09 per Class A and $0.09 per
Class B shares during the period.

Economic Review

Over the past year, the economies of the U.S. and the other dollar
bloc nations have continued to expand slowly. Despite this growth,
very low inflation and weak credit demand prevented any rise in
short-term interest rates.

In Europe, on the other hand, recessionary conditions deepened.
Unemployment reached double digits in most countries, and we do
not expect it to improve in the near future. Industrial production
and consumer demand are down sharply, while
social unrest is growing. Also, most European countries are
experiencing a low inflation environment. All this has lead to
lower interest rates in Europe and generally weaker currencies
versus the U.S. dollar. Exchange rate turbulence persisted
within Europe this year, until the beginning of August when the
European Monetary System's (EMS) exchange rate mechanism had another
historic adjustment. EMS authorities decided to widen the currency
fluctuation bands to 15% on either side of their
respective central rates. These broader ranges (previously either
2.25% or 6%), allow individual countries to be less constrained by
exchange rate levels in setting monetary policy. Presumably, central
banks will be freer to lower interest rates
to deal with weak economies.

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Strategy

The majority of the Fund's assets have been allocated among the dollar
bloc markets of the U.S., Australia, New Zealand and, to a lesser extent,
Canada. The Fund benefitted from unhedged positions in Australia and
particularly New Zealand, where
the currencies have strengthened and the yields were higher than
comparable maturity U.S. dollar securities. In our opinion, the
potential for higher commodity prices over the next year, combined
with support from a stronger U.S. dollar, should
continue to support the Australian and New Zealand dollars. The Fund's
holdings in Canada underperformed in 1993, however, as the Federal
elections and the downgrading of Provincial debt weighed on the currency.
As a result, we reduced the Fund's
Canadian allocation and do not expect to add aggressively to this position
until the investment environment becomes more favorable.

The Fund benefitted from securities held in Mexico over the year and, as
of fiscal year end, 3.9% of the portfolio was invested in Mexican Treasury
bills. With the passage of Nafta, Mexican investments continue to be
attractive. As a result,
the Advisor expects to increase exposure to the Mexican Treasury Bill
(CETE) market over the coming months.

The potential for greater currency fluctuation has made cross-currency
hedging more difficult. Also, European interest rates have fallen
dramatically in 1993 and yield spreads to the U.S. have narrowed,
making their short-term securities less attractive. At current
levels, there is limited scope to benefit from hedged European
investments with a maximum maturity of one year.

As always, it is a pleasure to have you as a shareholder of the Prudential
Short-Term Global Income Fund/Global Assets Portfolio and to take the
opportunity to report our activities to you.

Sincerely,

Lawrence C. McQuade
President

Jeffrey E. Brummette
Portfolio Manager

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Principal US$
Amount Value
(000) Description (a) (Note 1)

Australia--5.1%
Australian Treasury
Bills,**
A$ 10,100# 4.73%, 1/12/94........... $ 6,669,861
------------
Canada--12.1%
Canadian Treasury
Bills,**
C$ 11,016# 6.49%, 2/10/94........... 8,241,856
Quebec Treasury Bills,**
10,000# 6.23%, 5/20/94........... 7,368,895
------------
15,610,751
------------
Italy--8.4%
Banco Commerciale
Italiano, T.D.,
Lira 3,033,507 11.40%, 4/13/94.......... 1,868,430
Italian Treasury Bills,**
15,000,000# 12.00%, 3/30/94.......... 8,959,943
------------
10,828,373
------------
Mexico--3.9%
Mexican Treasury Bills,**
MP 3,406,140 18.45%, 11/4/93.......... 1,077,564
5,979,560 18.60%, 11/11/93......... 1,905,359
6,753,150 19.37%, 2/3/94........... 2,088,678
------------
5,071,601
------------
New Zealand--18.7%
New Zealand Treasury
Bills,**
NZ$ 10,700 6.95%, 3/23/94........... 5,806,773
33,850 7.05%, 3/23/94........... 18,370,025
------------
24,176,798
------------
Spain--3.2%
Kingdom of Spain,
Pts 580,000 9.97%, 7/15/94........... 4,080,695
------------
Sweden--3.7%
Swedish Treasury Bills,**
SKr 40,000 7.58%, 1/19/94........... $ 4,842,511
------------
United Kingdom--4.6%
Morgan Guaranty Bank,
Plc., C.D.,
; 3,000# 5.94%, 11/24/93.......... 4,466,879
Union Bank of
Switzerland, C.D.,
1,000# 5.66%, 12/24/93.......... 1,488,668
------------
5,955,547
------------
United States--41.0%
Federal Home Loan
Mortgage Corp.,
US$ 10,000 3.02%, 11/19/93.......... 9,999,657
7,000 3.00%, 11/29/93.......... 6,999,513
Fuji Bank, Ltd., T.D.,
10,000 3.00%, 11/1/93........... 10,000,000
Norwest Corp., T.D.,
10,000 3.13%, 11/22/93.......... 9,981,741
Potomac Elec. Pwr. Co.,
T.D.,
7,015 3.11%, 11/2/93........... 7,014,394
Joint Repurchase
Agreement
Account,
2.93%, 11/1/93, (Note
9,113 5)..................... 9,113,000
------------
53,108,305
------------

-3- See Notes to Financial Statements.
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US$

Value

Contracts+ Description (Note 1)

OUTSTANDING OPTIONS
PURCHASED*--0.9%
Call Options--0.1%
Japanese Yen,
expiring 1/13/94
Y= 5,500,000 @ Y=102.00............. $ 18,150
expiring 1/25/94
6,100,000 @ Y=109.20............. 84,790
------------
102,940
------------
Put Options--0.8%
Deutschemarks,
expiring 1/25/94
DM 11,000 @DM1.72................ 194,700
expiring 3/29/94
10,000 @DM1.68................ 392,000
expiring 4/18/94
6,000 @DM1.68................ 229,200
French Francs,
expiring 4/18/94
FF 6,000 @FF6.08................ 162,000
Japanese Yen,
expiring 1/13/94
Y= 6,100,000 @ Y=100.50............. 6,710
expiring 1/25/94
5,500,000 @ Y=110.00............. 70,400
------------
1,055,010
------------
Total outstanding options
purchased
(cost US$1,113,660).... 1,157,950
------------
Total Investments Before
Outstanding Put Options
Written--101.6%
(cost US$131,390,605;
Note 4)................ 131,502,392
------------
OUTSTANDING PUT OPTIONS
WRITTEN*--(0.1%)
Deutschemarks,
DM 9,500 expiring 11/24/93 @DM1.70
(premiums received
US$71,725)............. $ (85,500)
------------
Total Investments, Net of
Outstanding Put Options
Written--101.5%........ 131,416,892
Other liabilities in
excess of
other assets--(1.5%)... (1,904,368)
------------
Net Assets--100%......... $129,512,524
------------
------------

- ------------------
Portfolio securities are classified by country according to the
security's currency denomination.
(a) The following abbreviations are used in portfolio descriptions:
C.D.--Certificate of Deposit.
T.D.--Time Deposit.
# Principal amount segregated as collateral for forward currency
contracts and put options written. Aggregate value of segregated
securities--$37,196,102.
* Non-income producing security.
** Percentage quoted represent yields to maturity as of purchase date.
+ Expressed in thousands of local currency units.

-4- See Notes to Financial Statements.
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PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Statement of Assets and Liabilities

Assets
October 31, 1993
----------------
Investments, at value (cost $131,390,605)................... $131,502,392
Foreign currency, at value (cost $858,569).................. 864,031
Interest receivable......................................... 287,059
Receivable for Fund shares sold............................. 7,409
Deferred expenses and other assets.......................... 27,346

---------------
Total assets.............................................. 132,688,237
---------------
Liabilities
Payable for Fund shares
reacquired.................................................. 1,850,845
Forward currency contracts--net amount payable to
counterparties.............................................. 712,572
Accrued expenses............................................ 232,742
Dividends payable........................................... 167,798
Outstanding put options written, at value (premiums received
$71,725)................... 85,500
Due to Manager.............................................. 60,422
Due to Distributor.......................................... 50,894
Withholding taxes payable................................... 14,940
---------------
Total liabilities......................................... 3,175,713
---------------
Net Assets.................................................. $129,512,524
===============
Net assets were comprised of:
Common stock, at par...................................... $ 68,816
Paid-in capital in excess of par.......................... 145,685,303
---------------
145,754,119
Accumulated distributions in excess of net investment
income................................................... (4,673,778)
Accumulated net realized loss on investment and foreign currency
transactions............................................. (10,954,049)
Net unrealized depreciation on investments and foreign
currencies............................................... (613,768)
----------------
Net assets, October 31 ,1993................................ $129,512,524
===============
Class A:
Net asset value and redemption price per share
($127,489,968 / 67,753,600 shares of common stock
issued and outstanding)................................... $1.88
Maximum sales charge (.99% of offering price)............. .02
----------------
Maximum offering price to public.......................... $1.90
===============
Class B:
Net asset value and redemption price per share
($2,022,556 / 1,062,687 shares of common stock
issued and outstanding)................................. $1.90
===============

See Notes to Financial Statements.

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PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Statement of Operations

Year Ended
October 31,
Net Investment Income 1993
------------
Income
Interest (net of foreign
withholding
taxes of $30,390)................ $ 17,448,926
------------
Expenses
Management fee..................... 1,132,954
Distribution fee--Class A.......... 766,695
Distribution fee--Class B.......... 337,966
Custodian's fees and expenses...... 409,000
Transfer agent's fees and
expenses........................... 257,000
Registration fees.................. 56,000
Reports to shareholders............ 40,000
Directors' fees.................... 35,000
Audit fee.......................... 30,000
Legal fees......................... 23,000
Amortization of organization
expense............................ 12,000
Miscellaneous...................... 21,723
------------
Total expenses................... 3,121,338
------------
Net investment income................ 14,327,588
------------
Realized and Unrealized Gain (Loss)
on Investments and Foreign
Currency Transactions
Net realized gain (loss) on:
Investment transactions............ (10,234,268)
Foreign currency transactions...... (11,504,995)
Written option transactions........ 577,550
------------
(21,161,713)
------------
Net change in unrealized
appreciation/ depreciation of:
Investments........................ 23,210,345
Foreign currencies................. (6,048,398)
Written options.................... (3,936)
------------
17,158,011
------------
Net loss on investments, foreign
currencies and written options..... (4,003,702)
------------
Net Increase in Net Assets
Resulting from Operations............ $ 10,323,886
------------
------------
PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Statement of Changes in Net Assets

Year Ended October 31,
Increase (Decrease) ------------------------------
in Net Assets 1993 1992
------------- -------------
Operations
Net investment
Income................. $ 14,327,588 $ 30,353,603
Net realized loss on
investment and
foreign currency
transactions......... (21,161,713) (7,972,334)
Net change in
unrealized
appreciation/depreciation
of investments and
foreign currencies... 17,158,011 (17,605,231)
------------- -------------
Net increase in net
assets resulting from
operations........... 10,323,886 4,776,038
------------- -------------
Contingent deferred sales
charges collected (Note
2)..................... 25,932 --
------------- -------------
Net equalization
debits................. (3,675,103) (830,877)
------------- -------------
Dividends and
distributions (Note 1)
Dividends paid to
shareholders from net
investment income
Class A.............. (3,217,487) (4,271,370)
Class B.............. (1,053,946) (7,114,130)
------------- -------------
(4,271,433) (11,385,500)
------------- -------------
Distributions paid to
shareholders from
paid-in capital
Class A.............. (4,026,397) (5,345,237)
Class B.............. (1,318,920) (8,902,696)
------------- -------------
(5,345,317) (14,247,933)
------------- -------------
Fund share transactions
(Note 6)
Proceeds from shares
subscribed........... 169,695,598 399,041,474
Net asset value of
shares issued to
shareholders in
reinvestment of
dividends............ 5,821,978 15,398,999
Cost of shares
reacquired............. (356,365,191) (299,907,510)
------------- -------------
Net increase (decrease)
in net assets from
Fund share
transactions......... (180,847,615) 114,532,963
------------- -------------
Total increase
(decrease)............. (183,789,650) 92,844,691
Net Assets
Beginning of year........ 313,302,174 220,457,483
------------- -------------
End of year.............. $ 129,512,524 $ 313,302,174
------------- -------------
------------- -------------

See Notes to Financial Statements. See Notes to Financial Statements.

-6-
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PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Notes to Financial Statements

Prudential Short-Term Global Income Fund, Inc. (the ``Fund''), registered
under the Investment Company Act of 1940 as a non-diversified, open-end
management investment company, was incorporated in Maryland on February 21,
1990. The Fund consists of two series, namely: Short-Term Global Income
Portfolio and Global Assets Portfolio. The Global Assets Portfolio (the
``Portfolio'') commenced investment operations on February 15, 1991. The
investment objective of the Portfolio is to seek high current income with
minimum risk to principal, by investing primarily in high-quality debt
securities in the U.S. and abroad having remaining maturities of not more than
one year. The ability of the issuers of the debt securities held by the Fund to
meet their obligations may be affected by economic developments in a specific
country or industry.

Note 1. Accounting The following is a summary
Policies of significant accounting
policies followed by the Fund, and the Portfolio
in the preparation of its financial statements.

Securities Valuation: In valuing the Fund's assets, quotations of foreign
securities in a foreign currency are converted to U.S. dollar equivalents at the
then current exchange rate. Government securities for which quotations are
available will be based on prices provided by an independent pricing service or
principal market makers. Other portfolio securities that are actively traded in
the over-the-counter market, including listed securities for which the primary
market is believed to be over-the-counter, will be valued at the average of the
quoted bid and asked prices provided by an independent pricing service or by
principal market makers. Any security for which the primary market is on an
exchange is valued at the last sale price on such exchange on the day of
valuation or, if there was no sale on such day, the last bid price quoted on
such day. Securities for which market quotations are not readily available are
valued at fair value as determined in good faith by or under the direction of
the Board of Directors.

Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized cost which approximates market value. Certain short-term
securities with remaining maturities of 60 days or less are valued at market
value.

In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian takes possession of the
underlying collateral securities, the value of which exceeds the principal
amount of the repurchase transaction including accrued interest. If the seller
defaults and the value of the collateral declines or if bankruptcy proceedings
are commenced with respect to the seller of the security, realization of the
collateral by the Fund may be delayed or limited.

Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:

(i) market value of investment securities, other assets and liabilities--at
the closing daily rate of exchange;

(ii) purchases and sales of investment securities, income and expenses--at
the rate of exchange prevailing on the respective dates of such transactions.

Although the net assets of the Fund are presented at the foreign exchange
rates and market values at the close of the fiscal year, the Fund does not
isolate that portion of the results of operations arising as a result of changes
in the foreign exchange rates from the fluctuations arising from changes in the
market prices of securities held at the end of the fiscal year. Similarly, the
Fund does not isolate the effect of changes in foreign exchange rates from the
fluctuations arising from changes in the market prices of debt securities sold
during the fiscal year. Accordingly, realized foreign currency gains and losses
are included in the reported net realized loss on investment transactions.

Net realized loss on foreign currency transactions represents net foreign
exchange gains or losses from sales and maturities of short-term securities,
holding of foreign currencies, currency gains or losses realized between the
trade and settlement dates on security transactions, and the difference between
the amounts of interest and foreign taxes recorded on the Fund's books and the
U.S. dollar equivalent amounts actually received or paid. Net currency gains and
losses from valuing foreign currency denominated assets (excluding investments)
and liabilities
-7-
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at fiscal year end exchange rates are reflected as a component of net unrealized
depreciation on investments and foreign currencies.

Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of U.S. companies as a result of,
among other factors, the possibility of political and economic instability and
the level of governmental supervision and regulation of foreign securities
markets.

Forward Currency Contracts: The Fund enters into forward currency contracts in
order to hedge its exposure to changes in foreign currency exchange rates on its
foreign portfolio holdings. A forward contract is a commitment to purchase or
sell a foreign currency at a future date at a negotiated forward rate. The gain
or loss arising from the difference between the settlement value of the original
and renegotiated forward contracts, if any, is isolated and is included in net
realized gain (loss) from foreign currency transactions. Risks may arise upon
entering into these contracts from the potential inability of the counterparties
to meet the terms of their contracts.

Option Writing: When the Fund writes an option, an amount equal to the premium
received by the Fund is recorded as a liability and is subsequently adjusted to
the current market value of the option written. Premiums received from writing
options which expire unexercised are treated by the Fund on the expiration date
as realized gains from securities or currencies based on the type of option
written. The difference between the premium and the amount paid on effecting a
closing purchase transaction, including brokerage commissions, is also treated
as a realized gain, or if the premium is less than the amount paid for the
closing purchase transaction, as a realized loss. If a call option is exercised,
the premium is added to the proceeds from the sale of the underlying security or
currency in determining whether the Fund has realized a gain or loss. If a put
option is exercised, the premium reduces the cost basis of the securities or
currencies purchased by the Fund. The Fund as writer of an option may have no
control over whether the underlying securities or currencies may be sold
(called) or purchased (put) and as a result bears the market risk of an
unfavorable change in the price of the security or currency underlying the
written option.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from security and currency
transactions are calculated on the identified cost basis. Interest income is
recorded on the accrual basis.

Net investment income (other than distribution fees) and unrealized and
realized gains or losses are allocated daily to each class of shares based upon
the relative proportion of net assets of each class at the beginning of the day.

Equalization: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result, undistributed net investment
income per share is unaffected by sales or reacquisitions of the Fund's shares.

Dividends and Distributions: The Fund declares daily and pays dividends of net
investment income monthly and makes distributions at least annually of any net
capital gains. Dividends and distributions are recorded on the ex-dividend date.

Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. These differences are primarily due to differing
treatments for foreign currency transactions.

Reclassification of Capital Accounts: Effective November 1, 1992, the Fund began
accounting and reporting for distributions to shareholders in accordance with
Statement of Position 93-2; Determination, Disclosure, and Financial Statement
Presentation of Income, Capital Gain, and Return of Capital Distributions by
Investment Companies. The effect caused by adopting this statement was to
decrease paid-in capital by $3,433,904, decrease undistributed net investment
income by $15,060,910 and decrease accumulated net realized loss on investments
by $18,494,814 with respect to amounts reported through October 31, 1993, which
includes the effect of the 1993 distributions from paid-in capital reported in
the Statement of Changes in Net Assets. Net investment income, net realized
gains and net assets were not affected by this change.

Federal Income Taxes: For federal income tax purposes, each portfolio in the
Fund is treated as a separate taxpaying entity. It is the Portfolio's intent to
continue to meet the requirements of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its taxable income to
shareholders. Therefore, no federal income tax provision is required.

-8-
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Withholding taxes on foreign interest have been provided for in accordance
with the Fund's understanding of the applicable country's tax rules and rates.

Deferred Organization Expenses: Approximately $60,000 of organization and
initial registration costs were incurred. These costs have been deferred and are
being amortized over the period of benefit not to exceed 60 months from the date
the Portfolio commenced investment operations.

Note 2. Agreements The Fund has a manage
ment agreement with Prudential Mutual Fund
Management, Inc. (``PMF''). Pursuant to this agreement, PMF has responsibility
for all investment advisory services and supervises the subadviser's performance
of such services. PMF has entered into a subadvisory agreement with The
Prudential Investment Corporation (``PIC''); PIC furnishes investment advisory
services in connection with the managment of the Fund. PMF pays for the cost of
the subadviser's services, the compensation of officers of the Fund, occupancy
and certain clerical and bookkeeping costs of the Fund. The Fund bears all other
costs and expenses.

The management fee paid PMF is computed daily and payable monthly at an
annual rate of .55 of 1% of the average daily net assets of the Portfolio.

Pursuant to the Class A Plan, the Portfolio reimburses PMFD for its expenses
with respect to distributing and servicing the Fund's Class A shares at an
annual rate of up to .50 of 1% of the average daily net assets of the Class A
shares. PMFD pays various broker-dealers, including PSI and Pruco Securities
Corporation (``Prusec''), affiliated broker-dealers, for account servicing fees
and other expenses incurred by such broker-dealers.

PMFD recovers the distribution expenses and account servicing fees incurred
through the receipt of reimbursement payments from the Fund under the Class A
Plan and the receipt of initial sales charges. PMFD has advised the Portfolio
that it has received approximately $38,300 in front-end sales charges resulting
from sales of Class A shares during the fiscal year ended October 31, 1993. From
these fees, PMFD paid such sales charges to dealers (PSI and Prusec) which in
turn paid commissions to salespersons.

Pursuant to the Class B Plan, the Portfolio reimburses PSI for its
distribution-related expenses with respect to Class B shares, at an annual rate
of up to 1% of the average daily net assets of the Class B shares.

Effective February 1, 1993, PSI had no distribution costs reimbursable to it
under the Class B Plan and therefore, as of such date, the Fund discontinued
assessing distribution fees on the Class B shares and discontinued the payment
to PSI of any contingent deferred sales charges collected on the redemption of
Class B shares. All such contingent deferred sales charges collected on the
redemption of Class B shares are being retained and credited to the Fund's Class
B shares paid-in capital account. PSI has advised the Portfolio that, for the
period ended January 31, 1993, it received approximately $96,700 in contingent
deferred sales charges imposed upon certain redemptions by investors.

The Class B distribution expenses included commission credits for payment of
commissions and account servicing fees to financial advisers and an allocation
for overhead and other distribution-related expenses, interest and/or carrying
charges, the cost of printing and mailing prospectuses to potential investors
and of advertising incurred in connection with the distribution of shares.

PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.

Note 3. Other Prudential Mutual Fund
Transactions Services, Inc. (``PMFS''), a
With Affiliates wholly-owned subsidiary of
PMF, serves as the Fund's transfer agent and
during the fiscal year ended October 31, 1993, the Portfolio incurred fees of
approximately $170,200 for the services of PMFS. As of October 31, 1993,
approximately $10,200 of such fees were due to PMFS for its services. Transfer
agent fees and expenses in the Statement of Operations include certain out-of-
pocket expenses paid to non-affiliates.

Note 4. Portfolio The federal income tax
Securities basis of the Portfolio's
investments at October 31, 1993 was $131,830,823
and, accordingly, net unrealized depreciation for federal income tax purposes
was $328,431 (gross unrealized appreciation--$1,119,588; gross unrealized
depreciation--$1,448,019).

For federal income tax purposes, the Portfolio has a capital loss
carryforward as of October 31, 1993 of approximately $10,954,000 of which
$4,701,000 expires in 2000 and $6,253,000 expires in 2001. Accordingly, no
-9-
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<PAGE>
capital gains distributions are expected to be paid to shareholders until future
net gains have been realized in excess of such carryforward.

Transactions in options written during the fiscal year ended October 31, 1993
were as follows:

Number of
Contracts Premiums
(000) Received
--------- -----------
Options outstanding at
October 31, 1992............. 488 $ 305,000
Options written................ 134,875 1,781,866
Options terminated in closing
purchase transactions........ (91,817) (1,553,609)
Options expired................ (19,931) (210,475)
Options exercised.............. (14,115) (251,057)
--------- -----------
Options outstanding at
October 31, 1993............. 9,500 $ 71,725
--------- -----------
--------- -----------

At October 31, 1993, the Portfolio had outstanding forward currency
contracts, both to purchase and sell foreign currencies, as follows:

Foreign Currency Value at
Purchase Settlement Date Current Appreciation
Contracts Payable Value (Depreciation)
- ------------------- --------------- ----------- --------------
Australian Dollars,
expiring
11/16/93......... $ 10,851,754 $10,736,172 $ (115,582)
British Pounds,
expiring 11/1-
11/15/93......... 11,472,841 11,345,835 (127,006)
Deutschemarks,
expiring 11/5/93-
3/3/94........... 49,200,000 48,507,865 (692,135)
French Francs,
expiring 2/7-
2/14/94.......... 11,400,000 10,941,842 (458,158)
Italian Lira,
expiring
11/15/93......... 6,163,088 5,954,595 (208,493)
Spanish Pesetas,
expiring 11/2/93-
1/27/94.......... 6,785,598 6,784,293 (1,305)
Swedish Krona,
expiring
11/29/93......... 3,100,000 3,090,247 (9,753)
--------------- ----------- --------------
$ 98,973,281 $97,360,849 $ (1,612,432)
--------------- ----------- --------------
--------------- ----------- --------------
Value at
Foreign Currency Settlement Date Current Appreciation
Sale Contracts Receivable Value (Depreciation)
- ------------------- --------------- ------------ --------------
Australian Dollars,
expiring
11/16/93......... $ 2,151,105 $ 2,199,362 $(48,257)
Belgian Francs,
expiring
11/9/93.......... 6,228,574 6,287,862 (59,288)
British Pounds,
expiring
11/1/93.......... 4,498,163 4,467,561 30,602

Value at
Foreign Currency Settlement Date Current Appreciation
Sale Contracts Receivable Value (Depreciation)
- ------------------- --------------- ------------ --------------
Canadian Dollars,
expiring 11/9-
11/10/93......... $ 12,621,078 $ 12,488,722 $132,356
Danish Kroner,
expiring
11/15/93......... 6,954,987 6,758,032 196,955
Deutschemarks,
expiring 11/5/93-
3/3/94........... 44,889,127 44,375,683 513,444
French Francs,
expiring 11/5/93-
2/14/94.......... 17,629,296 17,790,087 (160,791)
Italian Lira,
expiring
11/15/93......... 3,232,731 3,094,503 138,228
Japanese Yen,
expiring 11/4-
11/8/93.......... 2,326,591 2,249,645 76,946
New Zealand
Dollars,
expiring
12/2/93.......... 12,586,740 12,609,585 (22,845)
Spanish Pesetas,
expiring 11/3/93-
1/14/94.......... 8,820,759 8,720,084 100,675
Swedish Krona,
expiring
11/29/93......... 2,000,000 1,998,165 1,835
--------------- ------------ --------------
$ 123,939,151 $123,039,291 $899,860
=============== ============ ==============

Note 5. Joint The Portfolio, along with
Repurchase other affiliated registered
Agreement investment companies,
Account transfers uninvested cash
balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or Federal agency obligations. As of October 31,
1993, the Portfolio has a 0.67% undivided interest in the repurchase agreements
in the joint account. The undivided interest for the Portfolio represents
$9,113,000 in principal amount. As of such date, each repurchase agreement in
the joint account and the collateral therefor were as follows:

CS First Boston Corp., 2.93%, in the principal amount of $360,000,000,
repurchase price $360,087,900, due 11/1/93, collateralized by $47,400,000 U.S.
Treasury Notes, 6.75%, due 2/28/97; $40,000,000 U.S. Treasury Notes, 11.25%, due
2/15/95; $100,000,000 U.S. Treasury Bonds, 7.50%, due 11/15/16; $50,000,000 U.S.
Treasury Bonds, 10.375%, due 11/15/12 and $50,000,000 U.S. Treasury Bonds,
12.00%, due 5/15/05; aggregate value including accrued interest-- $368,368,052.

-10-
<PAGE>
<PAGE>

Goldman Sachs & Co., 2.93%, in the principal amount of $450,154,000,
repurchase price $450,263,913, due 11/1/93, collateralized by $104,915,000 U.S.
Treasury Bonds, 12.00%, due 8/15/13 and $200,000,000 U.S. Treasury Bonds,
10.75%, due 8/15/05; aggregate value including accrued interest--$462,739,932.

Nomura Securities International, Inc., 2.90%, in the principal amount of
$60,889,000, repurchase price $60,903,715, due 11/1/93, collateralized by
$8,280,000 U.S. Treasury Notes, 7.75%, due 2/15/95; $25,000,000 U.S. Treasury
Notes, 7.375%, due 5/15/96 and $22,775,000 U.S. Treasury Notes, 8.875%, due
2/15/96; aggregate value including accrued interest--$62,140,276.

Smith Barney Shearson, Inc., 2.94%, in the principal amount of $175,000,000,
repurchase price $175,042,875, due 11/1/93, collateralized by $4,465,000 U.S.
Treasury Bonds, 12.00%, due 5/15/05; $11,435,000 U.S. Treasury Notes, 9.125%,
due 5/15/99; $75,000,000 U.S. Treasury Bonds, 8.125%, due 8/15/19 and
$50,000,000 U.S. Treasury Bonds, 8.00%, due 11/15/21; aggregate value including
accrued interest--$178,771,706.

Note 6. Capital The Portfolio currently
offers only Class A shares. Class A shares are
sold with a front-end sales charge of up to .99%. Prior to April 14, 1993, Class
B shares were sold with a contingent deferred sales charge of 1% on shares that
were held for less than one year. Both classes of shares have equal rights as to
earnings, assets and voting privileges except that each class has exclusive
voting rights with respect to its distribution plan. Class B shares held greater
than one year from date of purchase are automatically converted into Class A
shares. There are 500 million authorized shares of $.001 par value common stock
divided into two classes, designated Class A and Class B common stock, each of
which consists of 250 million authorized shares.

Transactions in shares of common stock for the fiscal years ended October 31,
1993 and 1992 were as follows:

Class A Shares Amount
- --------------------------- ------------ -------------
Year ended October 31,
1993:
Shares sold................ 6,064,340 $ 11,274,743
Shares sold--conversion
from Class B............. 83,379,084 154,875,114
Shares issued in
reinvestment of
dividends................ 2,229,981 4,138,266
Shares reacquired.......... (83,960,705) (155,987,024)
------------ -------------
Net increase in shares
outstanding.............. 7,712,700 $ 14,301,099
------------ -------------
------------ -------------
Year ended October 31,
1992:
Shares sold................ 62,227,845 $ 123,936,868
Shares sold--conversion
from
Class B.................. 36,073,212 69,181,633
Shares issued in
reinvestment
of dividends............. 2,381,023 4,661,342
Shares reacquired.......... (83,915,984) (163,633,251)
------------ -------------
Net increase in shares
outstanding.............. 16,766,096 $ 34,146,592
------------ -------------
------------ -------------

Class B
- ---------------------------
Year ended October 31,
1993:
Shares sold................ 1,902,610 $ 3,545,741
Shares issued in
reinvestment of
dividends................ 903,347 1,683,712
Shares reacquired.......... (24,366,585) (45,503,053)
Shares
reacquired--conversion
into Class A............. (83,275,750) (154,875,114)
------------ -------------
Net decrease in shares
outstanding.............. (104,836,378) $(195,148,714)
------------ -------------
------------ -------------
Year ended October 31,
1992:
Shares sold................ 103,880,763 $ 205,922,973
Shares issued in
reinvestment
of dividends............. 5,480,989 10,737,657
Shares reacquired.......... (34,364,047) (67,092,626)
Shares
reacquired--conversion
into Class A............. (36,073,212) (69,181,633)
------------ -------------
Net increase in shares
outstanding.............. 38,924,493 $ 80,386,371
[CAPTION]
------------ -------------
------------ -------------

-11-
<PAGE>
<PAGE>

PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
GLOBAL ASSETS PORTFOLIO
Financial Highlights
<TABLE>
<CAPTION>
Class A Class B
--------------------------------------- ------------------------------------
Year Ended February 15, Year Ended February 15,
October 31, 1991* through October 31, 1991* through
-------------------- October 31, ------------------- October 31,
1993 1992 1991 1993 1992 1991
-------- -------- --------------- ------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.......... $ 1.89 $ 2.00 $ 2.00 $ 1.89 $ 2.00 $ 2.00
-------- -------- ------- ------- -------- -------------
Income from investment operations
Net investment income......................... .12 .16 .12+ .12 .15 .11+
Net realized and unrealized gain (loss) on
investment and foreign currency
transactions................................ (.04) (.13) -- (.04) (.13) --
-------- -------- ------- ------- -------- -------------
Total from investment operations............ .08 .03 .12 .08 .02 .11
-------- -------- ------- ------- -------- -------------
Less distributions
Dividends from net investment income.......... (.04) (.14) (.12) (.04) (.13) (.11)
Distributions from paid-in capital............ (.05) -- -- (.05) -- --
-------- -------- ------- ------- -------- -------------
Total distributions......................... (.09) (.14) (.12) (.09) (.13) (.11)
-------- -------- ------- ------- -------- -------------
Contingent deferred sales charges collected... -- -- -- .02 -- --
-------- -------- ------- ------- -------- -------------
Net asset value, end of period................ $ 1.88 $ 1.89 $ 2.00 $ 1.90 $ 1.89 $ 2.00
-------- -------- ------- ------- -------- -------------
-------- -------- ------- ------- -------- -------------
TOTAL RETURN#:................................ 4.36% 1.46% 5.91% 5.47% 0.94% 5.53%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000)............... $127,490 $113,412 $86,443 $ 2,023 $199,890 $ 134,015
Average net assets (000)...................... $153,339 $138,331 $23,224 $52,653 $248,941 $ 42,449
Ratios to average net assets:
Expenses, including distribution fees....... 1.48% 1.33% 1.25%+** 1.61% 1.83% 1.75%+**
Expenses, excluding distribution fees....... .98% .83% .75%+** .98% .83% .75%+**
Net investment income....................... 6.44% 8.16% 8.64%+** 6.31% 7.66% 8.21%+**

- ---------------
* Commencement of investment operations.
** Annualized.
# Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase
of shares on the first day and a sale on the last day of each period reported and includes reinvestment of
dividends. Total returns for periods of less than a full year are not annualized.
+ Net of expense subsidy.

</TABLE>

See Notes to Financial Statements.

-12-
<PAGE>
<PAGE>

INDEPENDENT AUDITORS' REPORT

The Shareholders and Board of Directors
Prudential Short-Term Global Income Fund, Inc.
Global Assets Portfolio

We have audited the accompanying statement of assets and liabilities of
Prudential Short-Term Global Income Fund, Inc., Global Assets Portfolio,
including the portfolio of investments, as of October 31, 1993, the related
statements of operations for the year then ended and of changes in net assets
for each of the two years in the period then ended, and the financial highlights
for each of the two years in the period then ended and for the period February
15, 1991 (commencement of investment operations) to October 31, 1991. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of the securities owned as of
October 31, 1993 by correspondence with the custodian and brokers; where replies
were not received from brokers, we performed other auditing procedures. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Prudential
Short-Term Global Income Fund, Inc., Global Assets Portfolio, as of October 31,
1993, the results of its operations, the changes in its net assets and the
financial highlights for the respective stated periods in conformity with
generally accepted accounting principles.

Deloitte & Touche
New York, New York
December 15, 1993

-13-
<PAGE>
<PAGE>

Past performance is not predictive of future performance and an investor's
shares may be worth more or less than their original cost.

These graphs are furnished to you in accordance with SEC regulations. They
compare a $10,000 investment in Prudential Short-Term Global Income Fund: Global
Assets Portfolio (Class A and Class B) with a similar investment in the J.P.
Morgan Global Short-Term Index (GSTI) by portraying the initial account values
at the commencement of operations of each class and subsequent account values at
the end of each fiscal year (October 31), as measured on a quarterly basis,
beginning in 1991 for Class A and Class B shares. For purposes of the graphs
and, unless otherwise indicated, the accompanying tables, it has been assumed
that (a) the maximum sales charge was deducted from the initial $10,000
investment in Class A shares; (b) Class B shares converted into Class A shares
on March 1, 1992 and the graph demonstrates performance of Class A shares since
that date; (c) all recurring fees (including management fees) were deducted; and
(d) all dividends and distributions were reinvested.

The GSTI is a weighted index of liquid, short-term government bonds of the
following countries: Belgium, Sweden, Germany, Australia, Canada, Denmark,
France, Italy, Japan, Netherlands, Spain, U.S. and U.K. The GSTI is an unmanaged
index and changes in market capitalization in the GSTI are revised monthly. The
GSTI does not reflect the payment of transaction costs and advisory fees
associated with an investment in the Fund. The securities which comprise the
GSTI may differ substantially from the securities in the Fund's portfolio. The
GSTI is not the only index that may be used to characterize performance of
global income funds and other indices may portray different comparative
performance.

-14-
<PAGE>
<PAGE>

Directors
Stephen C. Eyre
Delayne D. Gold
Don G. Hoff
Harry A. Jacobs, Jr.
Sidney R. Knafel
Robert E. La Blanc
Lawrence C. McQuade
Thomas A. Owens, Jr.
Richard A. Redeker
Clay T. Whitehead

Officers
Lawrence C. McQuade, President
Robert F. Gunia, Vice President
Susan C. Cote, Treasurer
S. Jane Rose, Secretary
Domenick Pugliese, Assistant Secretary

Manager
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, NY 10292

Investment Adviser
The Prudential Investment Corporation
Prudential Plaza
Newark, NJ 07101

Distributors
Prudential Mutual Fund Distributors, Inc.
Prudential Securities Incorporated
One Seaport Plaza
New York, NY 10292

Custodian
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171

Transfer Agent
Prudential Mutual Fund Services, Inc.
P.O. Box 15005
New Brunswick, NJ 08906

Independent Accountants
Deloitte & Touche
1633 Broadway
New York, NY 10019

Legal Counsel
Shereff, Friedman, Hoffman & Goodman
919 Third Ave.
New York, NY 10022

One Seaport Plaza
New York, NY 10292
Toll free (800) 225-1852
Collect (908) 417-7555

This report is not authorized for distribution
to prospective investors unless preceded or
accompanied by a current prospectus.

74436H309 MF 149E

74436H408 Cat #4443616
<PAGE>
<PAGE>

Prudential
Short-Term Global
Income Fund, Inc.
Short-Term Global
Income Portfolio
- ------------------------------------------------
Prudential Mutual Funds
BUILDING YOUR FUTURE
(LOGO)
ON OUR STRENGTH

Letter to Shareholders

October 31, 1993

Dear Shareholder:

Over the past 12 months, the Prudential Short-Term Global Income
Fund/Short-Term Global Income Portfolio was able to circumvent much
of the volatility that continued in the global fixed income and
currency markets and outperform the Lipper
Short World Multi-Market average.

Total Returns

Historical* Average Annual**
As of October 31 As of September 30

Since Since
1-Year 11/01/90 1-Year 11/01/90

Class A 7.96% 20.27% 4.89% 4.62%
Class B 7.00% 16.53% 4.28% 4.53%

Lipper Short World
Multi-Market Avg.+ 4.53% N/A N/A N/A

*Source: Lipper Analytical Services. Returns are historical and
do not guarantee future performance. Investment return and principal
value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original
value. These figures do not take into account sales charges. The Fund
charges a maximum sales load of 3.0% for Class A shares. Class B shares
are subject to a declining contingent deferred sales charge of 3%, 2%,
1% and 1% for the first four years.

**Source: Prudential Mutual Fund Management, Inc. The 1-year average
takes into account a 3% sales charge, and the since inception return
includes a 1% sales charge.

+This is the average of 48 funds in the Short World Multi-Market
Average, according to Lipper Analytical Services, Inc.

The Short-Term Global Income Portfolio's net asset value on October 31,
1993, was $9.29 for both Class A and Class B shares. The Fund also paid
dividends of $0.58 per Class A and $0.49 per class B shares during the
fiscal year ended October 31, 1993.

Economic Review

Over the past year, the economies of the U.S. and the other dollar
bloc nations continued to expand slowly. Despite this growth, very
low inflation and weak credit demand prevented any short-term interest
rate rises.

-1-

In Europe, on the other hand, recessionary conditions deepened.
Unemployment reached double digits in most countries, and we do
not expect it to improve in the near future. Industrial production
and consumer demand are down sharply, while social
unrest is growing. Also, most European countries are experiencing a
low inflation environment. All this has lead to lower interest rates
in Europe, and generally weaker currencies versus the U.S. dollar.
Exchange rate turbulence persisted within
Europe this year, until the beginning of August when the European
Monetary System's (EMS) exchange rate mechanism had another historic
adjustment. EMS authorities decided to widen their permissible bands
of currency fluctuation to 15% on either side
of their respective central rates. These broader ranges
(previously either 2.25% or 6%), allow individual countries to
be less constrained by exchange rate levels in setting monetary
policy. Presumably, central banks will be freer to lower interest
rates to deal with weak economies.

Our strategy has been to benefit from declining interest rates in
Europe by holding nearly 50% to 60% of the Fund in two and three
year European bonds. The strength in the U.S. dollar has required
that the currency exposure be hedged. Despite
hedging costs, however, interest rates have fallen quickly enough
that short-term European securities have been a rewarding position
for the Fund.

In addition, the Fund maintained some 20% to 30% of its assets in
Australian, New Zealand and, to a lesser extent, Canadian dollar
securities. The Fund benefitted from unhedged positions in Australia
and particularly New Zealand, where the
currencies have strengthened and the yields were higher than comparable
maturity U.S. dollar securities. In our opinion, the potential for higher
commodity prices over the next year, combined with support from a stronger
U.S. dollar, should continue to support the Australian and New Zealand
dollars.

The Fund also maintained a 5% to 10% allocation in Mexican Treasury
bills where we felt the yield compensated for any exchange rate concerns.

Outlook

Looking ahead, we envision a similar strategy for next year. We expect
interest rates to continue to fall in Europe, so that hedged bonds in
these countries will still be an attractive investment. Additionally,
there may be opportunity for
cross-currency hedging, now that most currencies have settled into
their new trading ranges.

The passage of the North American Free Trade Agreement by the U.S.
Congress makes us more optimistic about the Mexican currency and bond
market, and we may increase the Fund's position there. In addition, we
expect to continue to hold Australian
and New Zealand dollar securities on an unhedged basis.

-2-

As always, it is a pleasure to have you as a shareholder of
the Prudential Short-Term Global Income Fund/Short-Term Global
Income Portfolio and to take the opportunity to report our activities
to you.

Sincerely,

Lawrence C. McQuade
President

Jeffrey E. Brummette
Portfolio Manager

-3-
<PAGE>
<PAGE>

Principal US$
Amount Value
(000) Description(a) (Note 1)

LONG-TERM INVESTMENTS--82.7%
Australia--11.3%
Australian Gov't.
Bonds,
A$ 3,840# 12.50%, 4/15/95........ $ 2,826,913
Queensland Treasury
Corp.,
21,700# 12.00%, 3/15/95........ 15,779,924
State Electric Comm.
Victoria,
25,700# 12.00%, 10/22/95....... 19,261,117
Western Australia
Treasury Corp.,
15,400# 12.00%, 9/15/95........ 11,487,762
------------
49,355,716
------------
Canada--7.6%
Alberta Province
Canada,
C$ 20,000# 5.75%, 9/3/96.......... 15,252,366
Canadian Gov't. Bonds,
22,650# 6.50%, 8/1/96.......... 17,672,214
------------
32,924,580
------------
Denmark--10.2%
Danish Treasury Notes,
DKr 285,000# 9.25%, 8/10/95......... 44,207,403
------------
Finland--3.0%
Finland Gov't. Bonds,
FM 74,000 6.50%, 9/15/96......... 12,954,601
------------
France--5.6%
Gov't. of France,
FF 163,000# Zero Coupon, 4/25/96... 24,305,478
------------
Germany--2.3%
German Gov't. Bonds,
DM 15,600# 8.50%, 4/22/96......... 9,983,348
------------
Ireland--1.7%
Irish Gov't. Bonds,
IEP 5,000 9.00%, 7/30/96......... 7,543,346
------------
Italy--12.0%
Eurofima,
Lira 5,500,000# 12.13%, 8/9/95......... $ 3,603,410
Export Finance of
Norway,
8,000,000# 12.25%, 8/5/96......... 5,396,193
General Electric
Capital Corp.,
4,000,000# 11.50%, 2/7/95......... 2,553,648
Italian Gov't. BTP,
63,750,000# 10.00%, 8/1/96......... 40,659,505
------------
52,212,756
------------
New Zealand--9.1%
Electric Corp. of New
Zealand,
NZ$ 30,000# 10.00%, 6/15/96........ 18,319,246
New Zealand Gov't.
Bonds,
36,000# 10.00%, 2/15/95........ 21,065,637
------------
39,384,883
------------
Norway--1.6%
Bolig Og Norgeskreditt
Mortgage Bonds,
NKr 45,200 10.50%, 12/20/95....... 6,762,033
------------
Spain--12.3%
Kingdom of Spain,
Pts 1,500,000 11.90%, 7/15/96........ 12,155,163
4,900,000 11.85%, 8/30/96........ 40,008,229
Nordic Investment Bank,
150,000 13.80%, 11/30/95....... 1,220,213
------------
53,383,605
------------
Sweden--2.3%
SBAB,
SKr 20,000 13.00%, 9/20/95........ 2,712,870
Swedish Gov't. Bonds,
55,000 11.50%, 9/1/95......... 7,323,431
------------
10,036,301
------------

-4- See Notes to Financial Statements.
<PAGE>
<PAGE>

Principal US$
Amount Value
(000) Description(a) (Note 1)

United Kingdom--3.7%
Bayerische Hypothelsen
Bank,
; 5,000# 11.13%, 6/24/96........ $ 8,338,297
United Kingdom Treasury
Notes,
5,000# 10.25%, 7/21/95........ 8,033,502
------------
16,371,799
------------
Total long-term
investments
(cost
US$358,046,699)...... 359,425,849
------------
SHORT-TERM INVESTMENTS--13.3%
Mexico--3.5%
Mexican Treasury
Bills,**
MP 5,676# 14.25%, 11/4/93........ 1,813,633
12,417# 16.95%, 11/11/93....... 3,956,929
8,469# 15.10%, 11/18/93....... 2,691,785
15,490# 13.80%, 12/23/93....... 4,869,268
5,979# 14.73%, 2/3/94......... 1,849,323
------------
15,180,938
------------
United Kingdom--3.4%
Dresdner Bank Sterling
C.D.,
; 10,000# 5.84%, 12/22/93........ 14,890,768
------------
United States--6.4%
Cariplo, IND.,
US$ 5,000 10.25%, 10/11/94....... 2,786,000
Nordbanken, IND.,
5,000 10.00%, 8/16/94........ 3,297,000
5,000 13.30%, 9/6/94......... 2,858,500
5,000 9.85%, 9/27/94......... 3,655,000
Joint Repurchase
Agreement Account,
US$ 15,270 2.93%, 11/1/93 (Note
5)................... $ 15,270,000
------------
27,866,500
------------
Total short-term
investments
(cost US$65,590,035)... 57,938,206
------------

OUTSTANDING OPTIONS
Contracts+ PURCHASED*--1.0%
- --------------

Call Options--0.2%
Japanese Yen,
Y= 18,900,000 expiring 1/13/94 @
Y=109.20............ 262,710
17,600,000 expiring 1/25/94 @
Y=110.00............ 225,280
------------
487,990
------------
Put Options--0.8%
Deutschemarks,
DM 35,100 expiring 1/25/94
@DM1.72.............. 621,270
40,000 expiring 3/29/94
@DM1.68.............. 1,568,000
19,000 expiring 4/18/94
@DM1.68.............. 725,800
French Francs,
FF 19,000 expiring 4/18/94
@FF6.08.............. 513,000
------------
3,428,070
------------
Total outstanding
options
purchased
(cost
US$3,234,535)........ 3,916,060
------------
Total Investments Before
Outstanding Put Options
Written--97.0%
(cost US$426,871,269;
Note 4).............. 421,280,115
------------

-5- See Notes to Financial Statements.
<PAGE>
<PAGE>

US$
Value
Contracts+ Description (Note 1)

OUTSTANDING PUT OPTIONS
WRITTEN*--(0.1%)
Deutschemarks,
DM 30,500 expiring 11/24/93
@DM1.70
(premiums received
US$230,275).......... $ (274,500)
------------
Total Investments, Net of
Outstanding Put Options
Written--96.9%..........421,005,615
Other assets in excess
of
other
liabilities--3.1%.... 13,466,062
------------
Net Assets--100%....... $434,471,677
------------
------------

- ------------------
Portfolio securities are classified according to the security's
currency denomination.
(a) The following abbreviations are used in portfolio descriptions:
C.D.--Certificate of Deposit.
IND.--Foreign Currency Index Linked Commercial Paper.
# Principal amount segregated as collateral for forward currency contracts and
put options written. Aggregate value of segregated securities--$298,817,669.
* Non-income producing security.
** Percentage quoted represent yields to maturity as of purchase date.
+ Expressed in thousands of local currency units.

-6- See Notes to Financial Statements.
<PAGE>
<PAGE>

PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
Short-Term Global Income Portfolio
Statement of Assets and Liabilities

<TABLE>
<CAPTION>
Assets October 31, 1993
----------------
<S> <C>
Investments, at value (cost $426,871,269)............................................... $421,280,115
Foreign currency, at value (cost $2,155,068)............................................ 2,147,115
Cash.................................................................................... 65,948
Receivable for investments sold......................................................... 17,991,844
Interest receivable..................................................................... 8,237,166
Forward currency contracts--net amount receivable from counterparties................... 821,121
Receivable for Fund shares sold......................................................... 104,241
Deferred expenses and other assets...................................................... 90,468
----------------
Total assets........................................................................ 450,738,018
----------------
Liabilities
Payable for investments purchased....................................................... 11,627,027
Payable for Fund shares reacquired...................................................... 2,630,208
Dividends payable....................................................................... 628,545
Accrued expenses........................................................................ 360,103
Due to Distributors..................................................................... 334,905
Outstanding put options written, at value (premiums received $230,275).................. 274,500
Due to Manager.......................................................................... 209,665
Withholding taxes payable............................................................... 201,388
----------------
Total liabilities................................................................... 16,266,341
----------------
Net Assets.............................................................................. $434,471,677
----------------
----------------
Net assets were comprised of:
Common stock, at par.................................................................. $ 46,785
Paid-in capital in excess of par...................................................... 472,008,986
----------------
472,055,771
Overdistributed net investment income................................................. (5,978,475)
Accumulated net realized loss on investment and foreign currency transactions......... (26,697,014)
Net unrealized depreciation on investments and foreign currencies..................... (4,908,605)
----------------
Net assets, October 31, 1993............................................................ $434,471,677
----------------
----------------
Class A:
Net asset value and redemption price per share ($59,458,310 / 6,399,282 shares of
common stock issued and outstanding)................................................ $9.29
Maximum sales charge (3.00% of offering price)........................................ .29
----------------
Maximum offering price to public...................................................... $9.58
----------------
----------------
Class B:
Net asset value, offering price and redemption price per share ($375,013,367 /
40,385,776 shares of common stock issued and outstanding)........................... $9.29
----------------
----------------
</TABLE>

See Notes to Financial Statements.

-7-
<PAGE>
<PAGE>

PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
Short-Term Global Income Portfolio
Statement of Operations

<TABLE>
<CAPTION>
Year Ended
October 31,
Net Investment Income 1993
------------
<S> <C>
Income
Interest (net of foreign
withholding
taxes of $450,769)............... $ 61,871,823
------------
Expenses
Distribution fee--Class A.......... 105,520
Distribution fee--Class B.......... 4,741,746
Management fee..................... 2,994,867
Custodian's fees and expenses...... 770,000
Transfer agent's fees and
expenses......................... 625,000
Reports to shareholders............ 161,000
Registration fees.................. 43,000
Amortization of organization
expenses......................... 40,000
Audit fee.......................... 38,000
Directors' fees.................... 35,000
Legal.............................. 28,000
Miscellaneous...................... 25,279
------------
Total expenses................... 9,607,412
------------
Net investment income................ 52,264,411
------------
Realized and Unrealized Gain (Loss)
on Investments and Foreign
Currency Transactions
Net realized gain (loss) on:
Investment transactions............ (18,599,346)
Foreign currency transactions...... (36,226,723)
Written option transactions........ 2,782,651
------------
(52,043,418)
------------
Net change in unrealized
appreciation/
depreciation of:
Investments........................ 51,502,372
Foreign currencies................. (14,324,433)
Written options.................... (21,806)
------------
37,156,133
------------
Net loss on investments, foreign
currencies and written options..... (14,887,285)
------------
Net Increase in Net Assets
Resulting from Operations............ $ 37,377,126
------------
------------
</TABLE>

PRUDENTIAL SHORT-TERM GLOBAL
INCOME FUND, INC.
Short-Term Global Income Portfolio
Statement of Changes in Net Assets

<TABLE>
<CAPTION>
Year Ended October 31,
Increase (Decrease) ----------------------------
in Net Assets 1993 1992
------------- ------------
<S> <C> <C>
Operations
Net investment income... $ 52,264,411 $ 85,611,889
Net realized loss on
investment and
foreign currency
transactions........ (52,043,418) (51,353,219)
Net change in
unrealized
appreciation/depreciation
of investments and
foreign
currencies.......... 37,156,133 (38,850,911)
------------- ------------
Net increase
(decrease) in net
assets resulting
from operations..... 37,377,126 (4,592,241)
------------- ------------
Net equalization
debits.............. (7,869,071) (3,256,032)
------------- ------------
Dividends to
shareholders from net
investment income
(Note 1)
Class A............... (4,363,707) (9,993,936)
Class B............... (25,199,590) (61,597,698)
------------- ------------
(29,563,297) (71,591,634)
------------- ------------
Fund share transactions
(Note 6)
Proceeds from shares
subscribed.......... 39,187,479 486,194,823
Net asset value of
shares issued to
shareholders in
reinvestment of
dividends........... 17,172,475 38,998,777
Cost of shares
reacquired.......... (330,090,306) (511,730,357)
------------- ------------
Net increase (decrease)
in net assets from
Fund share
transactions.......... (273,730,352) 13,463,243
------------- ------------
Total decrease.......... (273,785,594) (65,976,664)
Net Assets
Beginning of year....... 708,257,271 774,233,935
------------- ------------
End of year............. $ 434,471,677 $708,257,271
------------- ------------
------------- ------------
</TABLE>

See Notes to Financial Statements. See Notes to Financial Statements.

-8-
<PAGE>
<PAGE>

PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
Short-Term Global Income Portfolio
Notes to Financial Statements

Prudential Short-Term Global Income Fund, Inc. (the ``Fund'') is registered
under the Investment Company Act of 1940 as a non-diversified, open-end
management investment company. The Fund consists of two series, namely:
Short-Term Global Income Portfolio and Global Assets Portfolio. The Fund was
incorporated in Maryland on February 21, 1990 and had no significant operations
other than the issuance of 5,000 shares each of Class A and Class B common stock
of the Short-Term Global Income Portfolio for $100,000 on September 21, 1990 to
Prudential Mutual Fund Management, Inc. (``PMF''). The Short-Term Global Income
Portfolio (the ``Portfolio'') commenced investment operations on November 1,
1990. The investment objective of the Portfolio is to seek high current income
with minimum risk to principal, by investing primarily in high-quality debt
securities in both the U.S. and abroad having remaining maturities of not more
than three years. The ability of the issuers of the debt securities held by the
Fund to meet their obligations may be affected by economic developments in a
specific country or industry.

Note 1. Accounting The following is a summary
Policies of significant accounting poli
cies followed by the Fund, and the Portfolio in
the preparation of its financial statements.

Securities Valuation: In valuing the Fund's assets, quotations of foreign
securities in a foreign currency are converted to U.S. dollar equivalents at the
then current currency value. Government securities for which quotations are
available will be based on prices provided by an independent pricing service or
principal market makers. Other portfolio securities that are actively traded in
the over-the-counter market, including listed securities for which the primary
market is believed to be over-the-counter, will be valued at the average of the
quoted bid and asked prices provided by an independent pricing service or by
principal market makers. Any security for which the primary market is on an
exchange is valued at the last sale price on such exchange on the day of
valuation or, if there was no sale on such day, the last bid price quoted on
such day. Securities for which market quotations are not readily available are
valued at fair value as determined in good faith by or under the direction of
the Board of Directors.

Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:

(i) market value of investment securities, other assets and liabilities--at
the closing daily rate of exchange;

(ii) purchases and sales of investment securities, income and expenses--at
the rate of exchange prevailing on the respective dates of such transactions.

Although the net assets of the Fund are presented at the foreign exchange
rates and market values at the close of the fiscal year, the Fund does not
isolate that portion of the results of operations arising as a result of changes
in the foreign exchange rates from the fluctuations arising from changes in the
market prices of securities held at the end of the fiscal year. Similarly, the
Fund does not isolate the effect of changes in foreign exchange rates from the
fluctuations arising from changes in the market prices of long-term debt
securities sold during the fiscal year. Accordingly, realized foreign currency
gains and losses are included in the reported net realized loss on investment
transactions.

Net realized loss on foreign currency transactions represents net foreign
exchange gains or losses from sales and maturities of short-term securities,
holding of foreign currencies, currency gains or losses realized between the
trade and settlement dates on security transactions, and the difference between
the amounts of interest and foreign taxes recorded on the Fund's books and the
U.S. dollar equivalent amounts actually received or paid. Net currency gains and
losses from valuing foreign currency denominated assets (excluding investments)
and liabilities at fiscal year end
-9-
<PAGE>
<PAGE>
exchange rates are reflected as a component of net unrealized depreciation on
investments and foreign currencies.

Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from security and currency
transactions are calculated on the identified cost basis. Interest income is
recorded on the accrual basis.

Reclassification of Capital Accounts: Effective November 1, 1992, the Fund began
accounting and reporting for distributions to shareholders in accordance with
Statement of Position 93-2: Determination, Disclosure, and Financial Statement
Presentation of Income, Capital Gain, and Return of Capital Distributions by
Investment Companies. The effect caused by adopting this statement was to
decrease paid-in capital by $40,708,162, decrease undistributed net investment
income by $31,574,741 and decrease accumulated net realized loss by $72,282,903
with respect to amounts reported through October 31, 1993. Net investment
income, net realized gains and net assets were not affected by this change.

Withholding taxes on foreign interest have been provided for in accordance
with the Fund's understanding of the applicable country's tax rules and rates.

Deferred Organization Expenses: Approximately $200,000 of organization and
initial registration costs were incurred. These costs have been deferred and are
being amortized over the period of benefit not to exceed 60 months from the date
the Portfolio commenced investment operations. PMF has agreed not to redeem the
10,000
-10-
<PAGE>
<PAGE>
shares purchased until all organization expenses have been amortized.

Note 2. Agreements The Fund has a management
agreement with PMF. Pursuant to this agreement,
PMF has responsibility for all investment advisory services and supervises the
subadviser's performance of such services. PMF has entered into a subadvisory
agreement with The Prudential Investment Corporation (``PIC''); PIC furnishes
investment advisory services in connection with the managment of the Fund. PMF
pays for the cost of the subadviser's services, the compensation of officers of
the Fund, occupancy and certain clerical and bookkeeping costs of the Fund. The
Fund bears all other costs and expenses.

The management fee paid PMF is computed daily and payable monthly at an
annual rate of .55 of 1% of the average daily net assets of the Portfolio.

The Fund has distribution agreements with Prudential Mutual Fund
Distributors, Inc. (``PMFD''), which acts as the distributor of the Class A
shares of the Fund and with Prudential Securities Incorporated (``PSI'') which
acts as distributor of the Class B shares of the Fund (collectively, the
``Distributors''). To reimburse the Distributors for their expenses incurred in
distributing and servicing the Fund's Class A and B shares, the Fund, pursuant
to plans of distribution, pays the Distributors a reimbursement, accrued daily
and payable monthly.

Pursuant to the Class A Plan, the Portfolio reimburses PMFD for its expenses
with respect to Class A shares at an annual rate of up to .30 of 1% of the
average daily net assets of the Class A shares. Such expenses under the Class A
Plan were .15 of 1% of the average daily net assets of the Class A shares for
the fiscal year ended October 31, 1993. PMFD pays various broker-dealers,
including PSI and Pruco Securities Corporation (``Prusec''), affiliated
broker-dealers, for account servicing fees and other expenses incurred by such
broker-dealers.

Pursuant to the Class B Plan, the Portfolio reimburses PSI for its
distribution-related expenses with respect to Class B shares at an annual rate
of up to 1% of the average daily net assets of the Class B shares.

The Class B distribution expenses include commission credits for payment of
commissions and account servicing fees to financial advisers and an allocation
for overhead and other distribution-related expenses, interest and/or carrying
charges, the cost of printing and mailing prospectuses to potential investors
and of advertising incurred in connection with the distribution of shares.

The Distributors recover the distribution expenses and account servicing fees
incurred through the receipt of reimbursement payments from the Portfolio under
the plans and the receipt of initial sales charges (Class A only) and contingent
deferred sales charges (Class B only) from shareholders.

PMFD has advised the Portfolio that it has received approximately $64,400 in
front-end sales charges resulting from sales of Class A shares during the fiscal
year ended October 31, 1993. From these fees, PMFD paid such sales charges to
dealers (PSI and Prusec) which in turn paid commissions to salespersons.

With respect to the Class B Plan, at any given time the amount of expenses
incurred by PSI in distributing the Portfolio's shares and not recovered through
the imposition of contingent deferred sales charges in connection with certain
redemptions of shares may exceed the total payments made by the Portfolio
pursuant to the Class B Plan. PSI has advised the Portfolio that, for the fiscal
year ended October 31, 1993, it received approximately $2,203,700 in contingent
deferred sales charges imposed upon certain redemptions by investors. PSI, as
distributor, has also advised the Portfolio that at October 31, 1993, the amount
of distribution expenses incurred by PSI and not yet reimbursed by the Portfolio
or recovered through contingent deferred sales charges approximated $15,751,800.
This amount may be recovered through future payments under the Class B Plan or
contingent deferred sales charges.

In the event of termination or noncontinuation of the Class B Plan, the Fund
would not be contractually obligated to pay PSI, as distributor, for any
expenses not previously reimbursed or recovered through contingent deferred
sales charges.

PMFD is a wholly-owned subsidiary of PMF; PSI, PMF and PIC are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.

Note 3. Other Prudential Mutual Fund Ser
Transactions vices, Inc. (``PMFS'') a wholly-
With Affiliates owned subsidiary of PMF,
serves as the Fund's transfer agent and during the
fiscal year ended October 31, 1993, the Portfolio incurred fees of approximately
$544,800 for the services of PMFS. As of October 31, 1993, approximately $37,700
of such fees were due to PMFS for its services. Transfer agent fees and expenses
in the Statement of Operations include certain out-of-pocket expenses paid to
non-affiliates.

-11-
<PAGE>
<PAGE>

Note 4. Portfolio Purchases and sales of invest
Securities ment securities, other than
short-term investments and options, for the fiscal
year ended October 31, 1993 aggregated $1,291,897,873 and $1,350,325,743,
respectively.

The federal income tax basis of the Portfolio's investments at October 31,
1993 was $428,334,476 and, accordingly, net unrealized depreciation for federal
income tax purposes was $7,054,361 (gross unrealized appreciation-- $4,122,681;
gross unrealized depreciation--$11,177,042).

For federal income tax purposes, the Portfolio had a capital loss
carryforward as of October 31, 1993, of approximately $26,697,000 which expires
in 2001. Accordingly, no capital gains distributions are expected to be paid to
shareholders until future net gains have been realized in excess of such
carryforward.
Transactions in options written during the fiscal year ended October 31, 1993
were as follows:

<TABLE>
<CAPTION>
Number of
Contracts Premiums
(000) Received
--------- -----------
<S> <C> <C>
Options outstanding at
October 31, 1992............ 1,112 $ 695,000
Options written............... 442,208 6,190,524
Options terminated in closing
purchase transactions....... (316,745) (4,514,322)
Options expired............... (96,075) (2,140,927)
--------- -----------
Options outstanding at
October 31, 1993............ 30,500 $ 230,275
--------- -----------
--------- -----------
</TABLE>

At October 31, 1993, the Portfolio had outstanding forward currency
contracts, both to purchase and sell foreign currencies, as follows:
<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Purchase Contracts Payable Value (Depreciation)
- ------------------ --------------- ------------ -----------
<S> <C> <C> <C>
Australian
Dollars,
expiring
11/16/93........ $ 14,145,407 $ 13,973,601 $ (171,806)
Belgian Francs,
expiring
11/17//93....... 24,549,557 23,924,519 (625,038)
British Pounds,
expiring 11/2-
11/9/93......... 20,548,825 20,609,508 60,683
Canadian Dollars,
expiring
11/10/93........ 18,540,489 18,561,189 20,700
Danish Kroner,
expiring 11/1-
11/15/93........ 45,664,273 46,012,293 348,020
Deutschemarks,
expiring
11/4/93-
3/3/94.......... 167,624,265 165,346,862 (2,277,403)

<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Purchase Contracts Payable Value (Depreciation)
- ------------------ --------------- ------------ -----------
<S> <C> <C> <C>
French Francs,
expiring 2/7-
2/14/94......... $ 64,665,845 $ 63,612,265 $(1,053,580)
Italian Lira,
expiring 11/15-
11/24/93........ 24,072,525 23,045,518 (1,027,007)
New Zealand
Dollars,
expiring
12/2/93......... 9,970,144 9,921,089 (49,055)
Spanish Pesetas,
expiring 11/2-
1/27/94......... 55,093,021 55,083,455 (9,566)
Swedish Krona,
expiring 11/10-
11/29/93........ 20,629,370 20,437,377 (191,993)
Swiss Francs,
expiring
11/8/93......... 53,742,316 51,330,773 (2,411,543)
--------------- ------------ -----------
$ 519,246,037 $511,858,449 $(7,387,588)
--------------- ------------ -----------
--------------- ------------ -----------
</TABLE>

<TABLE>
<CAPTION>
Value at
Foreign Currency Settlement Date Current Appreciation
Sale Contracts Receivable Value (Depreciation)
- ------------------ --------------- ------------ -----------
<S> <C> <C> <C>
Australian
Dollars,
expiring
11/16/93........ $ 19,881,425 $ 20,327,438 $ (446,013)
Belgian Francs,
expiring 11/9-
11/16/93........ 48,181,987 47,788,761 393,226
British Pounds,
expiring
11/9/93......... 11,421,280 11,309,479 111,801
Canadian Dollars,
expiring 11/9-
11/10/93........ 40,300,000 39,812,040 487,960
Danish Kroner,
expiring 11/1-
12/1/93......... 112,577,537 110,971,009 1,606,528
Deutschemarks,
expiring
11/1/93-
3/3/94.......... 200,173,868 197,000,447 3,173,421
French Francs,
expiring
11/4/93-
2/14/94......... 116,925,020 117,045,973 (120,953)
Italian Lira,
expiring 11/15-
11/17/93........ 45,163,381 43,935,801 1,227,580
Japanese Yen,
expiring 11/4-
11/8/93......... 4,426,666 4,284,090 142,576
New Zealand
Dollars,
expiring
12/2/93......... 12,310,420 12,388,364 (77,944)
Norwegian Kroner,
expiring
11/26/93........ 7,026,179 6,945,979 80,200
Spanish Pesetas,
expiring
11/2/93-
1/14/94......... 91,037,924 89,643,732 1,394,192
Swedish Krona,
expiring 11/1-
11/29/93........ 19,794,621 19,782,288 12,333
Swiss Francs,
expiring
11/8/93......... 10,933,085 10,709,283 223,802
--------------- ------------ -----------
$ 740,153,393 $731,944,684 $ 8,208,709
--------------- ------------ -----------
--------------- ------------ -----------
</TABLE>

-12-
<PAGE>
<PAGE>

Note 5. Joint The Portfolio, along with
Repurchase other affiliated registered
Agreement investment companies, trans
Account fers uninvested cash balances
into a single joint account, the daily aggregate
balance of which is invested in one or more repurchase agreements collateralized
by U.S. Treasury or Federal agency obligations. As of October 31, 1993, the
Portfolio has a 1.1% undivided interest in the repurchase agreements in the
joint account. The undivided interest for the Portfolio represents $15,270,000
in principal amount. As of such date, each repurchase agreement in the joint
account and the collateral therefor were as follows:

Kidder, Peabody & Co. Inc., 2.95%, in the principal amount of $305,000,000,
repurchase price $305,074,979, due 11/1/93, collateralized by $210,030,000 U.S.
Treasury Bonds, 9.875%, due 11/15/15; value including accrued
interest--$311,527,136.
Nomura Securities International, Inc., 2.90%, in the principal amount of
$60,889,000, repurchase price $60,903,715, due 11/1/93, collateralized by
$8,280,000 U.S. Treasury Notes, 7.75%, due 2/15/95; $25,000,000 U.S. Treasury
Notes, 7.375%, due 5/15/96 and $22,775,000 U.S. Treasury Notes, 8.875%, due
2/15/96; aggregate value including accrued interest--$62,140,276.
Smith Barney Shearson, Inc., 2.94%, in the principal amount of $175,000,000,
repurchase price $175,042,875, due 11/1/93, collateralized by $4,465,000 U.S.
Treasury Bonds, 12.00%, due 5/15/05; $11,435,000 U.S. Treasury Notes, 9.125%,
due 5/15/99; $75,000,000 U.S. Treasury Bonds, 8.125%, due 8/15/19 and
$50,000,000 U.S. Treasury Bonds, 8.00%, due 11/15/21; aggregate value including
accrued interest--$178,771,706.

Note 6. Capital The Portfolio offers both
Class A and Class B shares. Class A shares are
sold with a front-end sales charge of up to 3.0%. Class B shares are sold with a
contingent deferred sales charge which declines from 3% to zero depending on the
period of time the shares are held. Both classes of shares have equal rights as
to earnings, assets and voting privileges except that each class bears different
distribution expenses and has exclusive voting rights with respect to its
distribution plan.

There are 1.5 billion authorized shares of $.001 par value common stock
divided into two classes, designated Class A and Class B common stock, each of
which consists of 750 million authorized shares. Of the 46,758,058 shares issued
and outstanding at October 31, 1993, PMF owned 10,000 shares.

Transactions in shares of common stock for the fiscal years ended October 31,
1993 and fiscal 1992 were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ---------------------------- ----------- -------------
<S> <C> <C>
Year ended October 31, 1993:
Shares sold................. 2,800,748 $ 25,157,507
Shares issued in
reinvestment of
dividends................. 334,726 3,006,237
Shares reacquired........... (7,797,277) (69,726,785)
----------- -------------
Net decrease in shares
outstanding............... (4,661,803) $ (41,563,041)
----------- -------------
----------- -------------
Year ended October 31, 1992:
Shares sold................. 8,598,472 $ 84,065,302
Shares issued in
reinvestment of
dividends................. 575,099 5,554,232
Shares reacquired........... (8,654,040) (83,274,185)
----------- -------------
Net increase in shares
outstanding............... 519,531 $ 6,345,349
----------- -------------
----------- -------------
<CAPTION>
Class B
- ----------------------------
<S> <C> <C>
Year ended October 31, 1993:
Shares sold................. 1,558,807 $ 14,029,972
Shares issued in
reinvestment of
dividends................. 1,575,399 14,166,238
Shares reacquired........... (29,032,710) (260,363,521)
----------- -------------
Net decrease in shares
outstanding............... (25,898,504) $(232,167,311)
----------- -------------
----------- -------------
Year ended October 31, 1992:
Shares sold................. 40,963,635 $ 402,129,521
Shares issued in
reinvestment of
dividends................. 3,451,357 33,444,545
Shares reacquired........... (45,225,866) (428,456,172)
----------- -------------
Net decrease in shares
outstanding............... (810,874) $ 7,117,894
----------- -------------
----------- -------------
</TABLE>
-13-
<PAGE>
<PAGE>

PRUDENTIAL SHORT-TERM GLOBAL INCOME FUND, INC.
Short-Term Global Income Portfolio
Financial Highlights

<TABLE>
<CAPTION>
Class A Class B
---------------------------------- ----------------------------------
Year Ended October 31, Year Ended October 31,
---------------------------------- ----------------------------------
1993 1992 1991 1993 1992 1991
---------- -------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of year................. $ 9.16 $ 9.97 $ 10.00 $ 9.16 $ 9.97 $ 10.00
---------- -------- -------- ---------- -------- --------
Income from investment operations
Net investment income.............................. .97 .96 1.03 .88 .88 .95
Net realized and unrealized loss on investment and
foreign currency transactions.................... (.26) (.95) (.02) (.26) (.95) (.02)
---------- -------- -------- ---------- -------- --------
Total from investment operations................. .71 .01 1.01 .62 (.07) .93
---------- -------- -------- ---------- -------- --------
Less distributions
Dividends from net investment income............... (.58) (.82) (1.03) (.49) (.74) (.95)
Distributions from net capital gains............... -- -- (.01) -- -- (.01)
---------- -------- -------- ---------- -------- --------
Total distributions.............................. (.58) (.82) (1.04) (.49) (.74) (.96)
---------- -------- -------- ---------- -------- --------
Net asset value, end of year....................... $ 9.29 $ 9.16 $ 9.97 $ 9.29 $ 9.16 $ 9.97
---------- -------- -------- ---------- -------- --------
---------- -------- -------- ---------- -------- --------
TOTAL RETURN#:..................................... 7.96% (0.07)% 10.41% 7.00% (0.86)% 9.51%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000)...................... $59,458 $101,358 $105,148 $375,013 $606,899 $669,086
Average net assets (000)........................... $70,347 $119,171 $51,830 $474,175 $814,734 $349,607
Ratios to average net assets:
Expenses, including distribution fees............ 1.02% 1.08% 1.01% 1.87% 1.93% 1.87%
Expenses, excluding distribution fees............ .87% .93% .86% .87% .93% .87%
Net investment income............................ 10.81% 9.93% 10.23% 9.42% 9.05% 9.46%
Portfolio turnover rate............................ 307% 180% 66% 307% 180% 66%
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# Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of
shares on the first day and a sale on the last day of each period reported and includes reinvestment of
dividends and distributions.
</TABLE>

See Notes to Financial Statements.

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INDEPENDENT AUDITORS' REPORT

The Shareholders and Board of Directors
Prudential Short-Term Global Income Fund, Inc.
Short-Term Global Income Portfolio

We have audited the accompanying statement of assets and liabilities of
Prudential Short-Term Global Income Fund, Inc., Short-Term Global Income
Portfolio, including the portfolio of investments, as of October 31, 1993, the
related statements of operations for the year then ended and of changes in net
assets for each of the two years in the period then ended, and the financial
highlights for each of the three years in the period then ended. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.

In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Prudential
Short-Term Global Income Fund, Inc., Short-Term Global Income Portfolio, as of
October 31, 1993, the results of its operations, the changes in its net assets
and its financial highlights for the respective stated periods in conformity
with generally accepted accounting principles.

Deloitte & Touche
New York, New York
December 15, 1993

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Past performance is not predictive of future performance and an investor's
shares may be worth more or less than their original cost.

These graphs are furnished to you in accordance with SEC regulations. They
compare a $10,000 investment in Prudential Short-Term Global Income Fund:
Short-Term Global Income Portfolio (Class A and Class B) with a similar
investment in the J.P. Morgan Global Short-Term Index (GSTI) by portraying the
initial account values at the commencement of operations of each class and
subsequent account values at the end of each fiscal year (October 31) beginning
in 1990 for Class A and Class B shares. For purposes of the graphs and, unless
otherwise indicated, the accompanying tables, it has been assumed that (a) the
maximum sales charge was deducted from the initial $10,000 investment in Class A
shares; (b) the maximum applicable contingent deferred sales charge was deducted
from the value of the investment in Class B shares assuming full redemption on
October 31, 1993; (c) all recurring fees (including management fees) were
deducted; and (d) all dividends and distributions were reinvested.

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