CMA
CMA PENNSYLVANIA
MUNICIPAL MONEY FUND
Semi-Annual Report
September 30, 1996
MERRILL LYNCH
BULL LOGO
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance, which will fluctuate. The Fund
seeks to maintain a consistent $1.00 net asset value per share,
although this cannot be assured. An investment in the Fund is
neither insured nor guaranteed by the US Government. Statements and
other information herein are as dated and are subject to change.
<PAGE>
CMA Pennsylvania
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011
Printed on post-consumer recycled paper
TO OUR SHAREHOLDERS:
For the six-month period ended September 30, 1996, CMA Pennsylvania
Municipal Money Fund paid shareholders a net annualized yield of
2.86%*. As of September 30, 1996, the Fund's 7-day yield was 3.01%.
The Environment
Although the US stock and bond markets rallied late in the six-month
period ended September 30, 1996, much of the period was marked by
volatility in the capital markets. The US economy demonstrated
surprising resilience during the first half of the year. As a
result, when economic data releases appeared to indicate that the US
economy was expanding at a stronger-than-expected (and potentially
inflationary) rate, investors focused on the increasing possibility
of monetary policy tightening by the Federal Reserve Board. During
these periods, stock prices declined and long-term interest rates
moved higher. However, with inflationary pressures still under
control, the US central bank did not tighten monetary policy at its
September 24 meeting. This development, coupled with several
economic data releases that showed growth was at or below
expectations, helped to assuage investors' concerns about an
overheating economy. Stock and bond prices improved, with stock
market averages reaching historic high levels.
<PAGE>
The shifts in perceptions were exemplified by investors' reactions
to the release of recent employment reports. Inflationary concerns
were heightened in early July with the release of a stronger-than-
expected employment report for June. However, more subdued job
growth and decelerating hourly wage gains were subsequently reported
for the month of July. Although the employment report for August
showed that unemployment had dropped to its lowest level since 1989,
these results were generally in line with expectations, and were
received favorably by investors. The greatest boost in investor
confidence occurred in early October with the release of September's
employment report, which showed a slight increase in unemployment.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
Investors will continue to monitor economic data releases to
determine the probable direction of the US economy. The outcome of
the upcoming November election will also increasingly influence
investor psychology in the weeks ahead.
Investment Outlook and Strategy
Economic growth in the Commonwealth of Pennsylvania remained
positive during the six-month period ended September 30, 1996. After
a sharp increase earlier in the period, the pace of growth in the
manufacturing sector moderated. Although still positive, new orders
have begun to decline, and current shipments remain strong. In
addition, expectations about future growth have moderated from
earlier in the period. Finally, with an upbeat economic picture
during the six-month period, Pennsylvania's employment levels showed
modest improvement as the seasonally adjusted unemployment rate has
fluctuated around the national level.
This positive economic growth allowed the Commonwealth to finish its
fiscal year 1996 on a solid note with a positive General Fund
balance of $183.8 million, or $65.5 million above estimates.
Contributing to this positive balance was tax collections for fiscal
year 1996 coming in at $16.3 billion, which is $69.8 million above
estimates and $113.9 million above the previous fiscal year. These
positive results will increase the Commonwealth's "rainy-day" fund
by $27.6 million to $211 million. During the six-month period ended
September 30, 1996, a $16.4 billion General Fund budget was enacted
for fiscal year 1997. This new budget increases government spending
a modest six tenths of 1%, provides for a $15 million tax cut or job
creation tax credit for companies who add new employees, and
increases school funding by $138 million. Finally, Governor Ridge
continues to exercise spending restraint over Commonwealth
expenditures by eliminating 1,000 jobs from the government payroll.
<PAGE>
The positive revenue stream allowed the Commonwealth to pay off its
outstanding $500 million in tax anticipation notes (TAN) in June, as
well as supplement the various Pennsylvania school districts who
continue to issue a very moderate amount of tax and revenue
anticipation notes (TRAN).
As discussed in our annual report to shareholders dated March 31,
1996, CMA Pennsylvania Municipal Money Fund began the six-month
period ended September 30, 1996 with an average portfolio maturity
in the 40-day range, while preparing to meet tax-related redemptions
in April. Once tax-related redemptions ended, we began to extend the
Fund's holdings of tax-exempt commercial paper into July and August
while waiting for the issuance of the annual City of Philadelphia
and Philadelphia School District TRAN. This extension increased the
Fund's average life to the 50-day range, which helped to stabilize
the Fund's yield as supply imbalances in the months of June and July
adversely affected yields on variable rate demand notes. Despite
strong employment data reports, inflationary data continued to
remain favorable during this period. As it became clearer during the
period that the Federal Reserve Board might hold interest rates
steady with the Federal Funds rate at 5.25% and other economic data
started to suggest a slower pattern of growth, we began taking
advantage of a spike in yields and extended the Fund's average
portfolio maturity to the 60-day range. We utilized the Fund's
holdings of tax-exempt commercial paper and purchases of City of
Philadelphia and Philadelphia school district TRAN as the only
available methods to extend.
Looking ahead, we will continue to monitor the various economic data
as well as the Federal Reserve Board's intentions with regard to
monetary policy. As conditions warrant, we will maintain a slightly
aggressive approach to the market using the annual issuance of
Pennsylvania TAN as a means to extend the average life of the Fund
in preparation for a period of technical strength in the early part
of 1997. We will continue to monitor economic data, and should
inflation begin to increase or the Federal Reserve Board change its
monetary stance to a bias toward tightening, we will change the
Fund's strategy accordingly. We continue to look for opportunities
to diversify the portfolio, and we closely monitor credit quality
while seeking to offer shareholders an attractive tax-exempt yield.
In Conclusion
We thank you for your support of CMA Pennsylvania Municipal Money
Fund, and we look forward to serving your investment needs in the
future.
<PAGE>
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Kevin A. Schiatta)
Kevin A. Schiatta
Vice President and Portfolio Manager
October 28, 1996
Portfolio Abbreviations for CMA Pennsylvania Municipal Money Fund
ACES SM Adjustable Convertible Extendable Securities
AMT Alternative Minimum Tax (subject to)
CP Commercial Paper
IDA Industrial Development Authority
IDR Industrial Development Revenue Bonds
M/F Multi-Family
PCR Pollution Control Revenue Bonds
S/F Single-Family
TRAN Tax Revenue Anticipation Notes
UPDATES Unit Price Daily Adjustable Tax-Exempt Securities
VRDN Variable Rate Demand Notes
<PAGE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF SEPTEMBER 30, 1996 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania-- $ 6,500 Allegheny County, Pennsylvania, IDA, Pollution Revenue Bonds (Duquesne
99.1% Light Project), CP, Series A, 3.70% due 2/21/1997 $ 6,500
6,000 Allegheny County, Pennsylvania, IDA, Revenue Refunding Bonds
(Commercial Development Parkway Center Mall Project), VRDN,
Series A, 4% due 5/01/2009 (a) 6,000
Beaver County, Pennsylvania, IDA, PCR:
5,100 (Duquesne Light Project), CP, AMT, Series A, 3.55% due 11/14/1996 5,100
4,200 (Duquesne Light Project), CP, AMT, Series A, 3.70% due 1/30/1997 4,200
4,000 Refunding (Atlantic Richfield Project), VRDN, 3.90% due
12/01/2020 (a) 4,000
8,000 Refunding (Toledo Edison Project), CP, Series E, 3.65% due 12/10/1996 8,000
Berks County, Pennsylvania, IDA, IDR:
4,100 (Citizens Utilities Co. Projects), CP, 3.70% due 12/11/1996 4,100
2,425 (Valley Forge Company, Inc. Project), VRDN, AMT, Series A, 4.25%
due 9/01/2006 (a) 2,425
4,830 Bucks County, Pennsylvania, IDA, Environmental Improvement Revenue
Refunding Bonds (USX Corporate Project), 3.55% due 10/01/1996 4,830
6,600 Bucks County, Pennsylvania, IDA, Revenue Bonds (Thypin Steel Co.),
VRDN, AMT, 3.95% due 12/01/2015 (a) 6,600
Carbon County, Pennsylvania, IDA, Resource Recovery Revenue Bonds
(Panther Creek Partners), CP, AMT:
4,050 Series A, 3.55% due 10/15/1996 4,050
4,445 Series A, 3.55% due 11/14/1996 4,445
6,200 Series A, 3.55% due 11/15/1996 6,200
14,540 Series B, 3.55% due 10/01/1996 14,540
2,550 Series B, 3.55% due 11/15/1996 2,550
1,780 Chartiers Valley, Pennsylvania, Industrial and Commercial
Development Authority, IDR, Refunding (Sycamore Creek Project),
3.75% due 3/01/1997 1,780
1,200 Chester County, Pennsylvania, IDA, IDR, Refunding (General Motors
Corp. Project), VRDN, 4% due 8/01/2001 (a) 1,200
Delaware County, Pennsylvania, IDA, PCR:
2,100 (BP Oil Inc. Project), UPDATES, VRDN, 3.95% due 12/01/2009 (a) 2,100
2,700 Refunding (BP Exploration & Oil), VRDN, 3.95% due 10/01/2019 (a) 2,700
4,500 Refunding (Philadelphia Electric Company), CP, Series A, 3.50%
due 10/01/1996 (c) 4,500
Eagle Tax Exempt Trust, Pennsylvania, VRDN (a):
4,300 Series 94, 4% due 5/01/2008 4,300
5,900 Series A, 3.95% due 7/01/2025 5,900
</TABLE>
<PAGE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF SEPTEMBER 30, 1996 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania Emmaus, Pennsylvania, General Authority Revenue Bonds, VRDN (a):
(continued) $ 3,300 Sub-Series B-12, 3.95% due 3/01/2024 $ 3,300
11,300 Sub-Series C-8, 3.95% due 3/01/2024 11,300
5,000 Sub-Series C-9, 3.95% due 3/01/2024 5,000
4,200 Sub-Series C-11, 3.95% due 3/01/2024 4,200
3,600 Sub-Series D-11, 3.95% due 3/01/2024 3,600
3,500 Sub-Series F-7, 3.95% due 3/01/2024 3,500
5,000 Sub-Series F-8, 3.95% due 3/01/2024 5,000
6,800 Sub-Series G-7, 3.95% due 3/01/2024 6,800
3,100 Erie County, Pennsylvania, IDA, Revenue Bonds (McInnes Steel Co.),
VRDN, AMT, 4% due 11/01/2001 (a) 3,100
10,000 Harrisburg, Pennsylvania, Revenue Bonds (Pool Financing Authority
Fund), VRDN, 4.10% due 7/01/2021 (a) 10,000
8,000 Montgomery County, Pennsylvania, Higher Education and Health
Authority Revenue Bonds (Pennsylvania Higher Education & Health
Loan), VRDN, Series A, 3.90% due 6/01/2021(a) 8,000
Montgomery County, Pennsylvania, IDA, Revenue Bonds (Merck & Co.
Project), Series A:
10,000 CP, 3.50% due 10/01/1996 10,000
1,700 VRDN, 4.30% due 10/01/2017 (a) 1,700
3,850 Montour County, Pennsylvania, IDA, PCR (Merck & Co. Project), VRDN,
Series A, 4.05% due 10/01/2003 (a) 3,850
5,000 Northeastern Pennsylvania, Hospital and Education Authority Revenue
Bonds (Allhealth Pooled Financing Program),VRDN, 3.95% due
7/01/2026 (a) 5,000
Pennsylvania Economic Development Financing Authority, Economic
Development Revenue Bonds:
1,600 (Erie Forge & Steel Project), VRDN, AMT, Series B-4, 4% due
12/01/1999 (a) 1,600
1,800 (Erie Plating Company Project), VRDN, AMT, Series B-5, 4% due
12/01/2004 (a) 1,800
5,300 (Gutchess Hardwoods Project), Series B, 3.60% due 4/01/2005 5,300
5,000 VRDN, AMT, Series D-7, 4% due 8/01/2022 (a) 5,000
2,100 VRDN, AMT, Series I-3, 4% due 12/01/2011 (a) 2,100
1,170 (Wendt Dunning Co. Project), VRDN, AMT, 4% due 9/01/2010 (a) 1,170
Pennsylvania Energy Development Authority, Energy Development Revenue
Bonds, VRDN, AMT (a):
5,850 (BIW Ebensburg Project), 3.90% due 12/01/2011 5,850
14,000 (Piney Creek Project), Series A, 3.95% due 12/01/2011 14,000
900 (Piney Creek Project), Series C, 3.95% due 12/01/2011 900
4,000 Pennsylvania Intergovernmental Cooperative Authority, Special Tax
Revenue Refunding Bonds (Philadelphia Funding Project), 5% due
6/15/1997 (b) 4,036
Pennsylvania State Higher Education Assistance Agency, Student Loan
Revenue Bonds, VRDN, AMT (a):
11,600 Series A, 3.90% due 1/01/2018 11,600
6,900 Series C, 3.90% due 7/01/2018 6,900
3,400 Pennsylvania State Higher Educational Facilities Authority, College
and University Revenue Refunding Bonds (Pennsylvania College of
Optometry), VRDN, 3.80% due 3/01/2026 (a) 3,400
Pennsylvania State Higher Educational Facilities Authority Revenue
Bonds (a):
3,000 (Allegheny College Project), VRDN, 3.95% due 11/01/2026 3,000
2,400 Refunding (Carnegie Mellon University), VRDN, Series C, 3.95%
due 11/01/2029 2,400
10,000 Refunding (Thomas Jefferson University), ACES, Series C, 3.70%
due 2/26/1997 10,000
</TABLE>
<PAGE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF SEPTEMBER 30, 1996 (CONCLUDED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania $ 5,000 Pennsylvania State University, Series A, 4% due 12/18/1996 $ 5,007
(concluded) 6,000 Pennsylvania State, VRDN, 4% due 5/01/2014 (a) 6,000
2,280 Philadelphia, Pennsylvania, Hospitals and Higher Educational
Facilities Authority, Hospital Revenue Refunding Bonds (Pennsylvania
Hospital), VRDN, Series B, 3.90% due 7/01/2023 (a) (b) 2,280
7,300 Philadelphia, Pennsylvania, IDA, Revenue Bonds (Institute for Cancer
Research Project), VRDN, Series A, 3.95% due 7/01/2013 (a) 7,300
4,425 Philadelphia, Pennsylvania, Redevelopment Authority, M/F Housing
Revenue Refunding Bonds (Courts Project), VRDN, Series A, 3.80%
due 6/01/2025 (a) 4,425
9,545 Philadelphia, Pennsylvania, School District, TRAN, 4.50% due
6/30/1997 9,579
15,000 Philadelphia, Pennsylvania, TRAN, Series A, 4.50% due 6/30/1997 15,059
1,650 Pittsburgh, Pennsylvania, Urban Redevelopment Authority, S/F
Mortgage Revenue Bonds, AMT, Series C, 3.70% due 12/01/1996 (c) 1,650
2,200 Red Lion, Pennsylvania, Area School District, TRAN, 4.25% due
6/30/1997 2,206
15,000 Temple University of the Commonwealth System of Higher Education,
Pennsylvania (University Funding Obligations), 4.625% due 5/20/1997 15,085
Venango, Pennsylvania, IDA Resource Recovery Revenue Bonds
(Scrubgrass Project), CP:
2,915 AMT, 3.55% due 10/15/1996 2,915
2,000 AMT, 3.55% due 11/15/1996 2,000
9,100 Refunding, AMT, Series A, 3.55% due 11/14/1996 9,100
4,300 Refunding, AMT, Series B, 3.55% due 11/14/1996 4,300
3,900 Washington County, Pennsylvania, Lease Authority Revenue Bonds
(Higher Education Pooled Equipment Lease), VRDN, Series 1985-A,
3.95% due 11/01/2005 (a) 3,900
3,000 Westmoreland County, Pennsylvania, IDA, Revenue Bonds (National
Waste and Energy Corp.--Valley Landfill Expansion Project), AMT,
4.375% due 5/01/1997 3,000
13,000 York, Pennsylvania, General Pooled Financing Authority Revenue
Bonds, VRDN, 3.85% due 9/01/2026 (a) 13,000
Total Investments (Cost--$376,232*)--99.1% 376,232
Other Assets Less Liabilities--0.9% 3,344
----------
Net Assets--100.0% $ 379,576
==========
<FN>
(a)The interest rate is subject to change periodically based on
certain indexes. The interest rate shown is the rate in effect at
September 30, 1996.
(b)FGIC Insured.
(c)GNMA Collateralized.
*Cost for Federal income tax purposes.
<PAGE>
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF SEPTEMBER 30, 1996
<S> <C> <C>
Assets:
Investments, at value (identified cost--$376,232,297) (Note 1a) $ 376,232,297
Cash 54,892
Receivables:
Interest $ 1,948,590
Securities sold 15,346 1,963,936
---------------
Prepaid registration fees and other assets (Note 1d) 1,690,117
---------------
Total assets 379,941,242
---------------
Liabilities:
Payables:
Investment adviser (Note 2) 165,423
Distributor (Note 2) 95,736
Beneficial interest redeemed 9 261,168
---------------
Accrued expenses and other liabilities 103,906
---------------
Total liabilities 365,074
---------------
Net Assets $ 379,576,168
===============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of shares
authorized $ 37,960,050
Paid-in capital in excess of par 341,640,134
Undistributed investment income--net 3,087
Accumulated realized capital losses--net (Note 4) (27,103)
---------------
Net Assets--Equivalent to $1.00 per share based on 379,600,510 shares of
beneficial interest outstanding $ 379,576,168
===============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 7,158,834
Expenses:
Investment advisory fees (Note 2) $ 997,555
Distribution fees (Note 2) 246,150
Transfer agent fees (Note 2) 53,434
Registration fees (Note 1d) 38,188
Accounting services (Note 2) 28,676
Professional fees 27,470
Custodian fees 18,202
Printing and shareholder reports 17,488
Pricing fees 3,571
Trustees' fees and expenses 1,984
Other 2,481
---------------
Total expenses 1,435,199
---------------
Investment income--net 5,723,635
Realized Loss on Investments--Net (Note 1c) (1,083)
---------------
Net Increase in Net Assets Resulting from Operations $ 5,722,552
===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the
Months Ended Year Ended
Sept. 30, 1996 March 31, 1996
Increase (Decrease) in Net Assets:
<S> <C> <C>
Operations:
Investment income--net $ 5,723,635 $ 12,163,742
Realized loss on investments--net (1,083) --
--------------- ---------------
Net increase in net assets resulting from operations 5,722,552 12,163,742
--------------- ---------------
Dividends to Shareholders (Note 1e):
Investment income--net (5,720,548) (12,163,742)
--------------- ---------------
Net decrease in net assets resulting from dividends to shareholders (5,720,548) (12,163,742)
--------------- ---------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 623,022,453 1,486,225,661
Net asset value of shares issued to shareholders in reinvestment of
dividends (Note 1e) 5,720,715 12,166,441
--------------- ---------------
628,743,168 1,498,392,102
Cost of shares redeemed (665,898,210) (1,435,297,725)
--------------- ---------------
Net increase (decrease) in net assets derived from beneficial interest
transactions (37,155,042) 63,094,377
--------------- ---------------
Net Assets:
Total increase (decrease) in net assets (37,153,038) 63,094,377
Beginning of period 416,729,206 353,634,829
--------------- ---------------
End of period* $ 379,576,168 $ 416,729,206
=============== ===============
<FN>
*Undistributed investment income--net $ 3,087 $ --
=============== ===============
<PAGE>
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been
derived from information provided in the financial For the
statements. Six Months
Ended Sept. 30, For the Year Ended March 31,
Increase (Decrease) in Net Asset Value: 1996 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Investment income--net .01 .03 .03 .02 .02
---------- ---------- ---------- ---------- ----------
Total from investment operations .01 .03 .03 .02 .02
---------- ---------- ---------- ---------- ----------
Less dividends from investment income--net (.01) (.03) (.03) (.02) (.02)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Investment Return 2.86%* 3.20% 2.65% 1.87% 2.29%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses .72%* .72% .71% .72% .72%
========== ========== ========== ========== ==========
Investment income--net 2.86%* 3.13% 2.64% 1.85% 2.22%
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of period (in thousands) $ 379,576 $ 416,729 $ 353,635 $ 336,853 $ 318,954
========== ========== ========== ========== ==========
<FN>
*Annualized.
See Notes to Financial Statements.
</TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
<PAGE>
1. Significant Accounting Policies:
CMA Pennsylvania Municipal Money Fund (the "Fund") is part of CMA
Multi-State Municipal Series Trust (the "Trust"). The Fund is
registered under the Investment Company Act of 1940 as a non-
diversified, open-end management investment company. These unaudited
financial statements reflect all adjustments which are, in the
opinion of management, necessary to a fair statement of the results
for the interim period presented. All such adjustments are of a
normal recurring nature. The following is a summary of significant
accounting policies followed by the Fund.
(a) Valuation of investments--Investments are valued at amortized
cost, which approximates market value. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be
the next coupon date on which the interest rate is to be adjusted.
In the case of a floating rate instrument, the remaining maturity is
the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
premium and discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(e) Dividends and distributions to shareholders--The Fund declares
dividends daily and reinvests daily such dividends (net of non-
resident alien tax withheld) in additional fund shares at net asset
value. Dividends are declared from the total of net investment
income, excluding discounts earned other than original issue
discounts. Net realized capital gains, if any, are normally
distributed annually after deducting prior years' loss carryforward.
The Fund may distribute capital gains more frequently than annually
in order to maintain the Fund's net asset value at $1.00 per share.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM" or "Adviser"). The general partner of
FAM is Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
<PAGE>
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets, at the following annual rates: 0.50%
of the first $500 million of average daily net assets; 0.425% of
average daily net assets in excess of $500 million but not exceeding
$1 billion; and 0.375% of average daily net assets in excess of $1
billion.
Pursuant to the Distribution and Shareholder Servicing Plan in
compliance with Rule 12b-1 under the Investment Company Act of 1940,
Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S") receives a
distribution fee from the Fund at the end of each month at the
annual rate of 0.125% of average daily net assets of the Fund. The
distribution fee is to compensate MLPF&S financial consultants and
other directly involved branch office personnel for selling shares
of the Fund and for providing direct personal services to
shareholders. The distribution fee is not compensation for the
administrative and operational services rendered to the Fund by
MLPF&S in processing share orders and administering shareholder
accounts.
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, PSI, MLPF&S, MLFDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the period
corresponds to the amounts included in the Statements of Changes in
Net Assets for net proceeds from sale of shares and cost of shares
redeemed, respectively, since shares are recorded at $1.00 per
share.
4. Capital Loss Carryforward:
At March 31, 1996, the Fund had a net capital loss carryforward of
approximately $26,000, of which $15,000 expires in 2002 and $11,000
expires in 2003. This amount will be available to offset like
amounts of any future taxable gains.
<PAGE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
Officers and Trustees
Arthur Zeikel--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Terry K. Glenn--Executive Vice President
Vincent R. Giordano--Senior Vice President
Edward J. Andrews--Vice President
Donald C. Burke--Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Kevin A. Schiatta--Vice President
Helen Marie Sheehan--Vice President
Gerald M. Richard--Treasurer
Robert Harris--Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, Massachusetts 02101
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 221-7210*
[FN]
*For inquiries regarding your CMA account, call (800) CMA-INFO
[(800) 262-4636].
