CMA
CMA PENNSYLVANIA
MUNICIPAL MONEY FUND
Annual Report
March 31, 1998
MERRILL LYNCH BULL LOGO
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
Steven T. Lewis--Vice President
Darrin J. SanFillippo--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 351
Boston, MA 02101
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 221-7210*
[FN]
*For inquiries regarding your CMA account,
call (800) CMA-INFO [(800) 262-4636].
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.
CMA Pennsylvania
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011
Printed on post-consumer recycled paper
TO OUR SHAREHOLDERS:
For the year ended March 31, 1998, CMA Pennsylvania Municipal Money
Fund paid shareholders a net annualized yield of 3.08%.* As of March
31, 1998, the Fund's 7-day yield was 3.03%.
Economic Environment and
Investment Strategy
The commonwealth of Pennsylvania closed out 1997 with total non-farm
jobs reaching over 5.4 million in December. This equated to more
than 100,000 new jobs being created in 1997 and 230,000 new jobs
since January 1995. Once again, the goods-producing sector led the
way with an increase for the fifth consecutive month. In addition,
three of the six major industry divisions in the service-producing
sector posted gains from their respective November job counts.
Commonwealth general fund collections totaled $1.5 billion in
December, outpacing estimates by $33.7 million or 2.4%, according to
statistics compiled by the Department of Revenue. Most notably,
December saw the commonwealth's strong personal income tax
collections continue, exceeding estimates by over 7%. Pennsylvania
manufacturers polled for the March Business Outlook Survey indicated
that their businesses continued to show growth. A majority of survey
indicators held close to their levels of the previous month,
suggesting continued steady growth for the regions' manufacturing
sector. The indicators reflecting future expectations for the next
six months also showed notable improvement according to the March
survey.
During November, the commonwealth of Pennsylvania brought its annual
short-term financing to market. The $225 million in notes issued
during November is expected to fully satisfy the commonwealth's cash
flow requirements for the year and received the highest short-term
ratings from both Moody's Investors Service, Inc. and Standard &
Poor's Corp. Moreover, as a result of the commonwealth's improved
financial condition, this is the smallest annual issuance of
operating notes in over 20 years. As expected, Governor Tom Ridge
announced that he would seek re-election to a second four-year term.
The Governor kicked off his campaign by proposing the elimination of
the commonwealth's personal income tax for families of four or more
earning $25,000 or less. The cut, which is expected to save those
families over $700 per year, will affect over 350,000 residents.
Finally, during the month of February, the commonwealth's
unemployment rate was reported at 4.7%.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
Throughout the fiscal year ended March 31, 1998, we maintained a
relatively neutral average portfolio maturity. We significantly
extended the Fund's average maturity only when the short-term tax-
exempt yield curve steepened. This steepening occurred at tax time
(April 1997) when cash outflows drove up yields on short-term tax-
exempt securities and, more prominently, in late summer 1997 when
states issued their annual cash flow notes. However, for most of the
fiscal year, a decrease in total fixed-rate issuance resulting from
healthy state economies and continued cash inflows kept the short-
term tax-exempt yield curves relatively flat. For example, yields on
90-day tax-exempt commercial paper performed on average with those
on short-term tax-exempt notes maturing in six months--one year for
most of the period. Thus, for a majority of that time, we used tax-
exempt commercial paper when we wanted to pursue a more aggressive
strategy. Furthermore, during the year ended March 31, 1998, assets
of tax-exempt money market funds rose by $25.6 billion, an increase
of over 17%.
The Fund, which began the fiscal year in the 45-day range, concluded
the period in the 40-day range. Our strategy allowed the Fund to
perform above average relative to similar Pennsylvania tax-exempt
money market funds for the year ended March 31, 1998. Finally, we
continue to focus on diversification and credit quality when
choosing Fund investments, and we constantly monitor the ever-
changing marketplace and adapt our investment strategy when
necessary.
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.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Darrin J. SanFillippo)
Darrin J. SanFillippo
Vice President and Portfolio Manager
April 30, 1998
Portfolio Abbreviations for CMA Pennsylvania Municipal Money Fund
AMT Alternative Minimum Tax (subject to)
CP Commercial Paper
GO General Obligation Bonds
IDA Industrial Development Authority
IDR Industrial Development Revenue Bonds
M/F Multi-Family
MSTR Municipal Securities Trust Receipts
PCR Pollution Control Revenue Bonds
S/F Single-Family
TAN Tax Anticipation Notes
TRAN Tax Revenue Anticipation Notes
UPDATES Unit Price Daily Adjustable Tax-Exempt Securities
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1998 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania-- Allegheny County, Pennsylvania, Hospital Development Authority Revenue
99.0% Bonds, VRDN (a):
$ 1,000 (Allegheny General Hospital), Series B, 3.65% due 9/01/2010 $ 1,000
600 (Presbyterian Health Center), Series A, 3.70% due 3/01/2020 (b) 600
500 (Presbyterian Health Center), Series B, 3.70% due 3/01/2020 (b) 500
5,000 (Saint Francis Medical Center--Accounts Receivable Program),
Series A, 3.80% due 2/15/2012 5,000
Allegheny County, Pennsylvania, IDA, Revenue Bonds (Unitel Mobile Video
Project), VRDN (a):
1,000 3.30% due 7/01/2009 1,000
3,500 Series B, 4.20% due 7/01/2009 3,500
8,800 Allegheny County, Pennsylvania, IDA, Revenue Refunding Bonds (Commercial
Development Parkway Center Mall Project), VRDN, Series A, 3.75% due
5/01/2009 (a) 8,800
8,800 Beaver County, Pennsylvania, IDA, Environmental Improvement Revenue Bonds
(BASF Corporation Project), VRDN, 3.75% due 9/01/2032 (a) 8,800
Beaver County, Pennsylvania, IDA, PCR:
2,000 (Duquesne Light Project), CP, 3.65% due 4/07/1998 2,000
4,200 (Duquesne Light Project), CP, 3.60% due 7/16/1998 4,200
4,000 Refunding (Atlantic Richfield Project), VRDN, 3.65% due 12/01/2020 (a) 4,000
10,000 Refunding (Toledo Edison), CP, Series E, 3.80% due 12/01/1998 10,000
Berks County, Pennsylvania, IDA, IDR:
4,100 (Citizens Utilities Co. Projects), CP, 3.60% due 7/17/1998 4,100
2,235 (Valley Forge Company, Inc. Project), VRDN, AMT, Series A, 3.90% due
9/01/2006 (a) 2,235
4,830 Bucks County, Pennsylvania, IDA, Environmental Improvement Revenue
Refunding Bonds (USX Corporate Project), 3.55% due 6/15/1998 4,830
2,600 Bucks County, Pennsylvania, IDA, Revenue Bonds (Dunmore Corp. Project),
VRDN, AMT, 3.90% due 9/01/2012 (a) 2,600
Carbon County, Pennsylvania, IDA, Resource Recovery Revenue Bonds
(Panther Creek Partners), Series A, CP, AMT:
2,000 3.55% due 4/03/1998 2,000
4,050 3.50% due 5/14/1998 4,050
2,550 3.60% due 5/14/1998 2,550
14,540 3.55% due 5/15/1998 14,540
6,200 3.70% due 5/15/1998 6,200
1,750 Crawford County, Pennsylvania, IDA, Revenue Bonds (Heatrix Inc. Project),
VRDN, AMT, Series A, 3.90% due 11/01/2017 (a) 1,750
4,690 Cumberland County, Pennsylvania, Municipal Authority College Revenue Bonds
(Dickinson College), Series B, 3.75% due 11/02/1998 4,690
5,300 Dauphin County, Pennsylvania, General Authority Revenue Bonds (School
District Pooled Financing Program II), VRDN, 4.10% due 9/01/2032 (a)(f) 5,300
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1998 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania $ 4,600 Delaware County, Pennsylvania, IDA, PCR (BP Oil Inc. Project), UPDATES, VRDN,
(continued) 3.70% due 12/01/2009 (a) $ 4,600
2,000 Delaware County, Pennsylvania, Revenue Bonds (Widener University Inc.),
VRDN, 3.80% due 7/01/2014 (a) 2,000
Eagle Tax-Exempt Trust, Pennsylvania, VRDN (a):
4,300 GO, Series 94, Class 3803, 3.63% due 5/01/2008 4,300
5,700 GO, Series 96-C, 3.63% due 5/01/2014 5,700
9,800 Housing Resident Development, Series 92, Class 3801, 3.75% due 7/01/1998 9,800
5,800 Housing Security, Series A, Class 3801, 3.48% due 7/01/2025 5,800
3,570 East Hempfield Township, Pennsylvania, IDA, Revenue Bonds (Steckel
Printing Inc.), VRDN, AMT, 3.90% due 2/01/2013 (a) 3,570
5,000 Emmaus, Pennsylvania, General Authority Revenue Bonds, VRDN, 3.75%
due 12/01/2028 (a)(d) 5,000
Erie County, Pennsylvania, IDA, Revenue Bonds, VRDN, AMT (a):
1,900 (McInnes Steel Co.), 3.75% due 11/01/2001 1,900
3,250 (Reed Manufacturing), 3.90% due 6/01/2006 3,250
6,000 Erie County, Pennsylvania, TRAN, 4.375% due 12/31/1998 6,025
3,700 Geisinger, Pennsylvania, Health System Revenue Bonds, VRDN, Series B,
3.70% due 7/01/2022 (a) 3,700
2,950 Jeannette, Pennsylvania, Health Service Authority, Hospital Revenue Bonds
(Jeannette District Memorial Hospital), VRDN, Series B, 3.80% due 11/01/2018 (a) 2,950
6,390 Lackawanna County, Pennsylvania, MSTR, VRDN, UT,Series SGB-38, 3.80%
due 9/15/2020 (a)(f) 6,390
Lancaster, Pennsylvania, IDA, Revenue Bonds (Kalas Manufacturing Inc.
Project), VRDN, AMT (a):
2,225 Series A, 3.90% due 10/01/2004 2,225
1,800 Series B, 3.90% due 10/01/2004 1,800
3,400 Lehigh County, Pennsylvania, General Purpose Authority Revenue Bonds
(Lehigh Valley Hospital), VRDN, Series A, 3.70% due 7/01/2028 (a)(f) 3,400
1,100 Montgomery County, Pennsylvania, GO, VRDN, UT, 3.45% due 11/15/2001 (a) 1,100
17,800 Montgomery County, Pennsylvania, Higher Education and Health Authority
Revenue Bonds (Pennsylvania Higher Education & Health Loan), VRDN,
Series A, 3.80% due 8/01/2021 (a) 17,800
1,700 Montgomery County, Pennsylvania, IDA, Revenue Bonds (Merck & Co. Project),
VRDN, Series A, 4.15% due 10/01/2017 (a) 1,700
4,810 Montgomery County, Pennsylvania, IDA, Revenue Refunding Bonds (Commercial
Development--Valley Forge Plaza), VRDN, 3.70% due 12/01/2013 (a) 4,810
3,850 Montour County, Pennsylvania, IDA, PCR (Merck & Co. Project), VRDN,
Series A, 3.70% due 10/01/2003 (a) 3,850
3,500 Moon, Pennsylvania, IDA, Commerical Development Revenue Bonds
(One Thorn Run Center Project), VRDN, Series A, 3.60% due 11/01/2015 (a) 3,500
Northampton County, Pennsylvania, IDA, Revenue Bonds, VRDN, AMT (a):
4,250 (MCS Industries Inc.), 3.90% due 6/01/2012 4,250
4,750 Refunding (Reale Association Project), 3.90% due 4/01/2012 4,750
1,000 Oil City, Pennsylvania, School District, UT, 3.95% due 8/27/1998 1,000
Pennsylvania Economic Development Financing Authority, Economic
Development Revenue Bonds, VRDN (a):
5,000 AMT, Series D-7, 3.95% due 8/01/2022 5,000
1,800 AMT, Series F-5, 3.95% due 12/01/2006 1,800
800 (Erie Forge & Steel Project), AMT, Series B-4, 3.95% due 12/01/1999 800
1,400 (Erie Plating Company Project), AMT, Series B-5, 3.95% due 12/01/2004 1,400
4,500 (Gutchess Hardwoods Project), Series B, 3.85% due 4/01/2005 4,500
1,090 (Wendt Dunnington Co. Project), AMT, 3.80% due 9/01/2010 1,090
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1998 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania $ 7,500 Pennsylvania Economic Development Financing Authority, Exempt Facilities
(continued) Revenue Bonds (National Gypsum Company Project), VRDN, AMT, Series A,
3.80% due 11/01/2027 (a) $ 7,500
Pennsylvania Energy Development Authority, Energy Development Revenue
Bonds, VRDN, AMT (a):
5,450 (B&W Ebensburg Project), 3.75% due 12/01/2011 5,450
14,000 (Piney Creek Project), Series A, 3.70% due 12/01/2011 14,000
900 (Piney Creek Project), Series C, 3.70% due 12/01/2011 900
9,900 Pennsylvania Intergovernmental Cooperative Authority, Special Tax Revenue
Bonds, VRDN, UT, 3.60% due 6/15/2007 (a) 9,900
Pennsylvania State Higher Education Assistance Agency, Student Loan
Revenue Bonds, VRDN (a):
3,100 AMT, Series A, 3.80% due 1/01/2018 3,100
15,000 AMT, Series A, 4.10% due 3/01/2027 15,000
1,800 Series C, 3.80% due 7/01/2018 1,800
3,400 Pennsylvania State Higher Educational Facilities Authority, College and
University Revenue Refunding Bonds (Pennsylvania College of Optometry),
VRDN, 3.70% due 3/01/2026 (a) 3,400
Pennsylvania State Higher Educational Facilities Authority Revenue Bonds:
5,000 CICU Financing Program (Rosemont College), Series B-6, 4.50% due
11/01/1998 5,018
2,500 Council Independent Colleges (Bucknell University), Series A-1, 3.58% due
4/01/1998 2,500
1,600 Council Independent Colleges (Duquesne University), Series A-4, 3.58% due
4/01/1998 1,600
Pennsylvania State Higher Educational Facilities Authority, Revenue Refunding
Bonds (Carnegie Mellon University), VRDN (a):
1,000 Series A, 3.70% due 11/01/2025 1,000
4,850 Series B, 3.70% due 11/01/2027 4,850
900 Series C, 3.70% due 11/01/2029 900
300 Series D, 3.70% due 11/01/2030 300
7,500 Pennsylvania State, TAN, 4.50% due 6/30/1998 7,515
2,000 Pennsylvania State Turnpike Commission, Turnpike Revenue Bonds, Series C,
7.55% due 12/01/1998 (c)(g) 2,086
3,000 Pennsylvania State University, Series A, 4.50% due 3/30/1999 3,027
2,560 Philadelphia, Pennsylvania, Authority for IDR (David Michael & Co. Inc.), VRDN,
AMT, 3.90% due 10/01/2006 (a) 2,560
Philadelphia, Pennsylvania, Hospital and Higher Education Facilities
Authority, Hospital Revenue Bonds (Children's Hospital Project), VRDN (a):
4,800 3.70% due 3/01/2027 4,800
4,300 Series A, 3.70% due 3/01/2027 4,300
2,185 Philadelphia, Pennsylvania, Hospital and Higher Education Facilities Authority,
Hospital Revenue Refunding Bonds (Pennsylvania Hospital), VRDN, Series B,
3.70% due 7/01/2023 (a)(c) 2,185
4,425 Philadelphia, Pennsylvania, Redevelopment Authority, M/F Housing Revenue
Refunding Bonds (Courts Project), VRDN, Series A, 3.70% due 6/01/2025 (a) 4,425
5,000 Philadelphia, Pennsylvania, School District, TRAN, 4.50% due 6/30/1998 5,008
15,000 Philadelphia, Pennsylvania, TRAN, Series A, 4.50% due 6/30/1998 15,018
8,000 Philadelphia, Pennsylvania, Water and Wastewater Revenue Bonds, VRDN,
Series B, 3.82% due 8/05/1998 (a)(f) 8,000
2,100 Pittsburgh, Pennsylvania, Urban Redevelopment Authority, S/F Mortgage
Revenue Bonds, AMT, Series C, 3.60% due 6/01/1998 (e) 2,100
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1998 (CONCLUDED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Pennsylvania Schuylkill County, Pennsylvania, IDA, Resource Recovery Revenue Refunding
(concluded) Bonds (Northeastern Power Co.), VRDN (a):
$ 24,300 AMT, Series B, 3.70% due 12/01/2022 $ 24,300
2,600 Series A, 3.60% due 12/01/2022 2,600
3,300 Scranton-Lackawanna, Pennsylvania, Health and Welfare Authority, Hospital
Facilities Revenue Refunding Bonds (Mercy Health Systems), VRDN, Series A,
3.65% due 12/01/2021 (a) 3,300
11,000 Temple University of the Commonwealth System of Higher Education,
Pennsylvania, University Funding Obligations, 4.75% due 5/18/1998 11,012
Venango, Pennsylvania, IDA, Resource Recovery Revenue Bonds (Scrubgrass
Progress), CP, AMT:
1,000 3.65% due 4/07/1998 1,000
2,000 3.70% due 4/07/1998 2,000
2,000 3.60% due 7/10/1998 2,000
6,000 Refunding, Series A, 3.85% due 4/08/1998 6,000
4,200 Refunding, Series A, 3.65% due 7/09/1998 4,200
7,300 Refunding, Series A, 3.45% due 7/17/1998 7,300
2,500 York, Pennsylvania, General Pooled Financing Authority Revenue Bonds, VRDN,
3.80% due 9/01/2026 (a) 2,500
Puerto Rico-- 5,000 Puerto Rico Commonwealth, Government Development Bank, Revenue
1.1% Refunding Bonds, VRDN, 3.375% due 12/01/2015 (a)(b) 5,000
Total Investments (Cost--$443,459*)--100.1% 443,459
Liabilities in Excess of Other Assets--(0.1%) (447)
---------
Net Assets--100.0% $ 443,012
=========
<FN>
(a)The interest rate is subject to change periodically based on
certain indexes. The interest rate shown is the rate in effect at
March 31, 1998.
(b)MBIA Insured.
(c)FGIC Insured.
(d)FSA Insured.
(e)GNMA Collateralized.
(f)AMBAC Insured.
(g)Prerefunded.
*Cost for Federal income tax purposes.
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF MARCH 31, 1998
<S> <C> <C>
Assets:
Investments, at value (identified cost--$443,458,955) (Note 1a) $ 443,458,955
Cash 106,588
Interest receivable 3,113,234
Prepaid registration fees and other assets (Note 1d) 837,345
---------------
Total assets 447,516,122
---------------
Liabilities:
Payables:
Securities purchased $ 4,100,000
Investment adviser (Note 2) 194,255
Distributor (Note 2) 132,478 4,426,733
---------------
Accrued expenses and other liabilities 77,226
---------------
Total liabilities 4,503,959
---------------
Net Assets $ 443,012,163
===============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of shares
authorized $ 44,305,889
Paid-in capital in excess of par 398,752,672
Accumulated realized capital losses--net (Note 4) (46,398)
---------------
Net Assets--Equivalent to $1.00 per share based on 443,058,886 shares of
beneficial interest outstanding $ 443,012,163
===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 1998
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 15,440,314
Expenses:
Investment advisory fees (Note 2) $ 2,072,950
Distribution fees (Note 2) 513,883
Transfer agent fees (Note 2) 92,719
Accounting services (Note 2) 66,136
Professional fees 58,610
Registration fees (Note 1d) 37,186
Custodian fees 33,785
Pricing fees 8,368
Printing and shareholder reports 7,329
Trustees' fees and expenses 3,216
Other 4,243
---------------
Total expenses 2,898,425
---------------
Investment income--net 12,541,889
Realized Loss on Investments--Net (Note 1c) (22,010)
---------------
Net Increase in Net Assets Resulting from Operations $ 12,519,879
===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended
March 31,
Increase (Decrease) in Net Assets: 1998 1997
<S> <C> <C>
Operations:
Investment income--net $ 12,541,889 $ 11,528,806
Realized loss on investments--net (22,010) (1,453)
-------------- --------------
Net increase in net assets resulting from operations 12,519,879 11,527,353
-------------- --------------
Dividends to Shareholders (Note 1e):
Investment income--net (12,541,889) (11,525,719)
-------------- --------------
Net decrease in net assets resulting from dividends to shareholders (12,541,889) (11,525,719)
-------------- --------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 1,609,592,001 1,355,806,175
Net asset value of shares issued to shareholders in reinvestment of
dividends (Note 1e) 12,541,999 11,525,515
-------------- --------------
1,622,134,000 1,367,331,690
Cost of shares redeemed (1,607,995,896) (1,355,166,461)
-------------- --------------
Net increase in net assets derived from beneficial interest
transactions 14,138,104 12,165,229
-------------- --------------
Net Assets:
Total increase in net assets 14,116,094 12,166,863
Beginning of year 428,896,069 416,729,206
-------------- --------------
End of year $ 443,012,163 $ 428,896,069
============== ==============
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 statements.
For the Year Ended March 31,
Increase (Decrease) in Net Asset Value: 1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Investment income--net .03 .03 .03 .03 .02
---------- ---------- ---------- ---------- ----------
Total from investment operations .03 .03 .03 .03 .02
---------- ---------- ---------- ---------- ----------
Less dividends from investment income--net (.03) (.03) (.03) (.03) (.02)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Investment Return 3.08% 2.92% 3.19% 2.65% 1.87%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses .70% .71% .72% .71% .72%
========== ========== ========== ========== ==========
Investment income--net 3.03% 2.86% 3.13% 2.64% 1.85%
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of year (in thousands) $ 443,012 $ 428,896 $ 416,729 $ 353,635 $ 336,853
========== ========== ========== ========== ==========
See Notes to Financial Statements.
</TABLE>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
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. 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 and back-up withholding 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"). 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.
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, 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, 1998, the Fund had a net capital loss carryforward of
approximately $46,000, of which $13,000 expires in 2002; $11,000
expires in 2003; and $22,000 expires in 2006. This amount will be
available to offset like amounts of any future taxable gains.
<AUDIT-REPORT>
CMA PENNSYLVANIA MUNICIPAL MONEY FUND
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders,
CMA Pennsylvania Municipal Money Fund
of CMA Multi-State Municipal Series Trust:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of CMA Penn-
sylvania Municipal Money Fund of CMA Multi-State Municipal Series
Trust as of March 31, 1998, the related statements of operations for
the year then ended and changes in net assets for each of the years
in the two-year period then ended, and the financial highlights for
each of the years in the five-year period then ended. These
financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and the 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 the financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities owned at March
31, 1998 by correspondence with the custodian and broker. 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
CMA Pennsylvania Municipal Money Fund of CMA Multi-State Municipal
Series Trust as of March 31, 1998, 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 LLP
Princeton, New Jersey
May 1, 1998
</AUDIT-REPORT>
IMPORTANT TAX INFORMATION (UNAUDITED)
All of the net investment income distributions paid daily by CMA
Pennsylvania Municipal Money Fund of CMA Multi-State Municipal
Series Trust during its taxable year ended March 31, 1998 qualify as
tax-exempt interest dividends for Federal income tax purposes.
Additionally, there were no capital gains distributed by the Fund
during the year.
Please retain this information for your records.
