Filed electronically with the Securities and Exchange Commission
on September 3, 1999
File No. 33-34645
File No. 811-6103
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /___/
Pre-Effective Amendment No. /___/
--
Post-Effective Amendment No. 13 / X /
--
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 /___/
Amendment No. 15 / X /
--
INVESTORS CASH TRUST
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(Exact Name of Registrant as Specified in Charter)
222 South Riverside Plaza, Chicago, Illinois 60606
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (312) 537-7000
Philip J. Collora, Vice President and Secretary
Investors Cash Trust
222 South Riverside Plaza
Chicago, Illinois 60606
-----------------------
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box):
/___/ Immediately upon filing pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a) (1)
/___/ 75 days after filing pursuant to paragraph (a) (2)
/___/ On __________________ pursuant to paragraph (b)
/ X / On November 10, 1999 pursuant to paragraph (a) (1)
/___/ On __________________ pursuant to paragraph (a) (2) of Rule 485.
If Appropriate, check the following box:
/___/ This post-effective amendment designates a new effective date for a
previously filed post-effective amendment
<PAGE>
November 10, 1999
Prospectus
Mutual Funds:
o are not FDIC-insured
o have no bank guarantees
o may lose value
GOVERNMENT SECURITIES PORTFOLIO
Scudder Government Cash Institutional Shares
Scudder Government Cash Managed Shares
The Securities and Exchange Commission has not approved or
disapproved these securities or passed upon the adequacy of
this prospectus. Any representation to the contrary is a
criminal offense.
<PAGE>
CONTENTS
ABOUT THE PORTFOLIO.......................................................3
Investment objective.............................................3
Main investment strategies.......................................3
Risk management strategies.......................................3
Main risks.......................................................4
Past performance.................................................4
Fee and expense information......................................5
Investment restrictions..........................................7
ABOUT YOUR INVESTMENT....................................................10
Share price.....................................................10
Minimum balances................................................10
Initial purchase by wire........................................11
Additional purchases by wire....................................11
Initial Purchase by mail........................................12
Additional purchases by mail....................................12
By Automatic Investment Plan (Managed Shares Only)..............12
Purchase restrictions...........................................12
Processing time.................................................12
Checkwriting (Managed Shares Only)..............................13
Redemption by mail..............................................14
To redeem shares by mail follow the following instructions:.....14
Telephone Redemption............................................14
Third party transactions........................................15
Redemption-in-kind..............................................15
Distributions...................................................15
Taxes...........................................................16
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<PAGE>
ABOUT THE PORTFOLIO
- -------------------
Investment objective
The portfolio seeks to provide maximum current income consistent with stability
of capital.
Except as otherwise noted, the portfolio's investment objective and other
policies may be changed by the portfolio's Board of Trustees, without a vote of
shareholders.
Main investment strategies
The portfolio pursues its objective by investing exclusively in U.S. Treasury
bills, notes, bonds and other obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities, and certain repurchase
agreements. All such securities purchased mature in 12 months or less. The
portfolio maintains a dollar weighted average maturity of 90 days or less and is
managed to maintain a net asset value of $1.00 per share.
The portfolio may invest in repurchase agreements. Repurchase agreements are
instruments under which the portfolio acquires ownership of a U.S. Government
security from a broker-dealer or bank that agrees to repurchase such security at
a mutually agreed upon time and price, which price is higher than the purchase
price. The maturity of the securities subject to repurchase may exceed one year.
Currently, the portfolio will only enter into repurchase agreements with primary
U.S. Government securities dealers recognized by the Federal Reserve Bank of New
York that have been approved pursuant to procedures adopted by the Board of
Trustees.
The portfolio may invest in floating rate and variable rate instruments
(obligations that do not bear interest at fixed rates). Accordingly, as interest
rates decrease or increase, the potential for capital appreciation or
depreciation is less for fixed-rate obligations.
Securities are purchased and sold based on the investment manager's perception
of monetary conditions, the available supply of appropriate investments, and the
managers' projections for short-term interest rate movements.
Of course, there can be no guarantee that by following these investment
strategies, the portfolio will achieve its objective.
Risk management strategies
The portfolio seeks to minimize credit risk by investing exclusively in
short-term obligations issued or guaranteed by the U.S. Government, its agencies
or instrumentalities.
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Main risks
As with most money market Funds, the major factor affecting the portfolio's
performance is short-term interest rates. If short-term interest rates fall, the
portfolio's yields are also likely to fall. Moreover, the portfolio managers'
strategy or choice of specific investments may not perform as expected. This
portfolio may have lower returns than other portfolios that invest in
longer-term lower-quality securities. It is also possible that securities in the
portfolio's investment portfolio could be downgraded in credit rating or go into
default.
Some securities issued by U.S. Government agencies or instrumentalities are
supported only by the credit of that agency or instrumentality, while other
securities have an additional line of credit with the U.S. Treasury. There is no
guarantee that the U.S. Government will provide support to such agencies or
instrumentalities, and such securities may involve risk of loss of principal and
interest.
An investment in the portfolio is not insured or guaranteed by the Federal
Deposit Insurance Company or any other government agency. Although the portfolio
seeks to preserve the value of your investment at $1.00 per share, it is
possible to lose money by investing in the portfolio.
Past performance
No Performance is provided for the Scudder Government Cash Institutional Shares
("Institutional Shares") and Scudder Government Cash Managed Shares ("Managed
Shares") since they do not have a full calendar year of performance. For
reference, the chart and table below shows how the total returns for the
portfolio's Service Shares have varied from year to year, which may give you
some indication of risk. Of course, past performance is not necessarily an
indication of future performance. While Service Shares are not offered in this
prospectus, they have substantially similar gross performance of Institutional
and Managed Shares because both are invested in the same portfolio of
securities. However, Institutional and Managed Shares will generally have higher
returns to the extent that they have lower expenses.
Total returns of the Service Shares for years ended December 31
Bar Chart
1992 3.33
1993 2.89
1994 4.02
1995 5.75
1996 5.20
1997 5.75
1998 5.21
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<PAGE>
For the period included in the bar chart, the portfolio's Service Shares highest
return for a calendar quarter was 1.57% (the first quarter of 1991), and the
portfolio's Service Shares lowest return for a calendar quarter was 0.71% (the
fourth quarter of 1992 and the first quarter of 1993).
The portfolio's Service Shares year-to-date total return as of June 30, 1999 was
2.34%.
Average Annual Total Returns
For periods ended Government
December 31, 1998 Securities Portfolio- Service Shares
- ----------------- ------------------------------------
One Year 5.35%
Five Years 5.21%
Since Portfolio Inception* 4.86%
- -----------
* Inception date for the portfolio is September 27, 1990.
7-Day Yield (Service Shares)
On December 31, 1998 4.84%
Fee and expense information
This information is designed to help you understand the fees and expenses that
you may pay if you buy and hold the respective shares of the portfolio.
<TABLE>
<CAPTION>
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Shareholder Fees (fees paid directly from your investment): Institutional Shares Managed Shares
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<S> <C> <C>
Maximum sales charge (load) imposed on purchases (as % of offering price) NONE NONE
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Maximum deferred sales charge (load) (as % of redemption proceeds) NONE NONE
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Maximum sales charge (load) imposed on reinvested dividends/distribution NONE NONE
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Redemption fee (as % of amount redeemed, if applicable) NONE NONE
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Exchange fee NONE NONE
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Annual portfolio operating expenses (expenses that are deducted from portfolio
assets):
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Management fee 0.15% 0.15%
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Distribution (12b-1) fees 0.xx% 0.xx%
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Other expenses 0.xx%* 0.xx%*
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Total annual portfolio operating expenses 0.xx% 0.xx%
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[Expense reimbursement] [0.xx%] [0.xx%]
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[Net expenses] [0.xx%**] [0.xx%**]
-------------------------------------------------------------------------------------------------------------------------
</TABLE>
* "Other Expenses" are based are based on estimated amounts for each class
for the current fiscal year.
[** By contract, expenses will be capped at ____% through July 31, 2000.]
5
<PAGE>
[ASF language to be added]
6
<PAGE>
Example
This example is to help you compare the cost of investing in the Institutional
or Managed Shares of the portfolio with the cost of investing in other mutual
Funds.
This example illustrates the impact of the above fees and expenses on an account
with an initial investment of $10,000, based on the Institutional and Managed
Shares' respective expenses as shown above. It assumes a 5% annual return, the
reinvestment of all dividends and distributions, the sale of shares at the end
of each period, and "Annual portfolio operating expenses" remaining the same
each year except the first year. [The first year of your investment will take
into account the "Net expenses" for the Institutional and Managed Classes as
shown above.] The expenses would be the same whether you sold your shares at the
end of each period or continued to hold them. Actual portfolio expenses and
return vary from year to year, and may be higher or lower than those shown.
- ---------------------------------------------------------------
Institutional Shares Managed Shares
- ---------------------------------------------------------------
One Year $
- ---------------------------------------------------------------
Three Years $
- ---------------------------------------------------------------
Five Years $
- ---------------------------------------------------------------
Ten Years $
- ---------------------------------------------------------------
Investment restrictions
The portfolio has adopted the following fundamental investment restrictions
which cannot be changed without shareholder approval.
o Except as permitted under the Investment Company Act of 1940, as amended,
and interpreted or modified by regulatory authority having jurisdiction,
from time to time, the portfolio may not:
- borrow money;
- issue senior securities;
- concentrate its investments in a particular industry; or
- make loans.
o The portfolio may not engage in the business of underwriting securities
issued by others, except to the extent that the portfolio may be deemed to
be an underwriter in connection with the disposition of portfolio
securities;
o The portfolio may not purchase or sell real estate, which term does not
include securities of companies which deal in real estate or mortgages or
investments secured by real estate or interests therein, except that the
portfolio reserves freedom of action to hold and to sell real estate
acquired as a result of the portfolio's ownership of securities; or
o The portfolio may not purchase physical commodities or contracts relating
to physical commodities.
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<PAGE>
In addition, the portfolio has adopted the following non-fundamental policies
which may be changed by the Board of Trustees without shareholder approval.
o The portfolio may not:
- make short sales of securities, or purchase any securities on margin
except to obtain such short-term credits as may be necessary for the
clearance of transactions; or
- write, purchase, or sell puts, calls or combinations thereof.
o Except in connection with the master/feeder structure implemented for the
portfolio, the portfolio may not purchase any securities other than
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, and repurchase agreements of such obligations. However,
if the Fund implements a master/feeder Fund structure, shareholder approval
is required.
Investment adviser
The portfolio retains the investment management firm of Scudder Kemper
Investments, Inc., the ("Adviser"), 345 Park Avenue, New York, New York, to
manage the portfolio's daily investment and business affairs subject to the
policies established by the Board of Trustees. The Adviser actively manages the
portfolio's investments. Professional management can be an important advantage
for investors who do not have the time or expertise to invest directly in
individual securities. The Adviser is one of the largest and most experienced
investment management organizations worldwide, managing more than $280 billion
in assets globally for mutual Fund investors, retirement and pension plans,
institutional and corporate clients, and private family and individual accounts.
The Adviser; the portfolio's Principal Underwriter, Kemper Distributors, Inc.
("KDI"); the portfolio's Shareholder Servicing Agent, Kemper Service Company;
and the portfolio's Accounting Agent, Scudder Fund Accounting Corporation, have
contractually agreed to maintain the total annualized expenses of the
portfolio's Managed Shares and Institutional Shares at no more than __% and __%
of the average daily net assets, respectively through July 31, 2000. As a
result, the Adviser received an investment management fee of 0.07% of the
portfolio's average daily net assets on an annual basis for the fiscal year
ended March 31, 1999 reflecting the effect of expense limitations then in
effect.
Portfolio management
The following investment professionals are associated with the portfolio as
indicated:
<TABLE>
<CAPTION>
Name & Title Joined the Portfolio Background
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Frank J. Rachwalski, Jr., 1990 Mr. Rachwalski joined the Adviser in 1973 as
Lead Manager a money market specialist and began his
(inception) investment career at that time. He has been
responsible for the trading and portfolio
management (inception) of money market
portfolios since 1974.
Jerri I. Cohen, 1998 Ms. Cohen joined the Adviser in 1981 as an
Manager accountant and began her investment career
- --------------------------------------------------------------------------------------------------
</TABLE>
8
<PAGE>
Year 2000 readiness
Like all mutual portfolios, this portfolio could be affected by the inability of
some computer systems to recognize the year 2000. The Adviser has a year 2000
readiness program designed to address this problem, and is also researching the
readiness of suppliers and business partners as well as issuers of securities
the portfolio owns. Still, there's some risk that the year 2000 problem could
materially affect the portfolio's operations (such as its ability to calculate
net asset value and process purchases and redemptions), its investments, or
securities markets in general.
9
<PAGE>
ABOUT YOUR INVESTMENT
- ---------------------
TRANSACTION INFORMATION
Share price
Scudder Fund Accounting Corporation determines the net asset value per share of
the portfolio on each day the New York Stock Exchange is open for trading, at
12:00 noon, 2:00 p.m. and 4:00 p.m. Eastern time.
The portfolio seeks to maintain a net asset value of $1.00 per share, and values
its portfolio instruments at amortized cost. Calculations are made to compare
the value of the portfolio's investments, valued at amortized cost, with
market-based values. In order to value its investments at amortized cost, the
portfolio purchases only securities with a maturity of 397 days or less, and
maintains a dollar-weighted average portfolio maturity of 90 days or less. In
addition, the Fund limits its portfolio investments to securities that meet the
quality and diversification requirements under federal law.
The net asset value per share is the value of one share, and is determined by
dividing the value of the portfolio's total net assets attributable to the
applicable class, less liabilities attributable to that class, by the total
number of shares outstanding for that class.
Minimum balances
Institutional Shares
The minimum initial investment and account balance is $1,000,000. There is no
required minimum investment amount for subsequent investments.
Managed Shares
The minimum initial investment and account balance is $100,000. The minimum for
each additional investment is $1,000 and $100 for IRAs.
For each class of shares account balances will be reviewed periodically and the
Adviser reserves the right, following 60 days written notice to shareholders, to
redeem all shares in accounts that have a value below the required minimum for
at least 30 days where such a reduction in value has occurred due to a
redemption, exchange or transfer out of the account.
The minimum investment requirements may be waived or lowered for investments
effected through banks and other institutions that have entered into special
arrangements with the Distributor on behalf of the portfolio and for investments
effected on a group basis by certain other entities and their employees, such as
pursuant to a payroll deduction plan and for investments made in an Individual
Retirement Account. Investment minimums may also be waived for Trustees and
Officers of the Trust.
10
<PAGE>
Initial purchase by wire
1. You may open an account by calling toll free from any continental state:
1-800-537-3177. Give the fund(s) and class(es) to be invested in, name(s)
in which the account is to be registered, address, Social Security or
taxpayer identification number, dividend payment election, amount to be
wired, name of the wiring bank and name and telephone number of the person
to be contacted in connection with the order. An account number will then
be assigned.
2. Instruct the wiring bank to transmit the specified amount to:
UMB Bank N.A.
10th and Grand Avenue
Kansas City, Missouri 64106
ABA Number 101-000-695
DDA# 44:98-0120-0321-1
Attention: Government Securities Portfolio: (Institutional Shares or
Managed Shares as the case may be.)
Account Number (as assigned by telephone and amount invested in the
portfolio
1. Complete a Purchase Application. Indicate the services to be used. A
complete Purchase Application must be received by Kemper Services Company
(the "Shareholder Servicing Agent") before the Expedited Redemption can be
used. Mail the Purchase Application to:
Kemper Service Company
Attn: South Institutional Funds Client Services
222 South Riverside Plaza, 33rd Floor
Chicago, IL 60606
Orders for shares of the portfolio will become effective when an investor's bank
wire order is received by UMB Bank, N.A. or when a check is converted into
federal funds.
Orders for purchase of shares received by wire transfer in the form of Federal
Funds will be effected at the next determined net asset value. Shares purchased
by wire will receive that day's dividend if effected at or prior to the 2:00
p.m. Eastern time net asset value determination, otherwise such shares will
receive the dividend for the next calendar day if effected at 4:00 p.m. Eastern
time. Orders for purchase accompanied by a check or other negotiable bank draft
will be accepted and effected as of 4:00 p.m. Eastern time on the next business
day following receipt, and such shares will receive the dividend for the next
calendar day following the day when the purchase is effected. If an order
accompanied by a check drawn on a foreign bank, funds must normally be collected
on such check before shares will be purchased.
Additional purchases by wire.
Instruct the wiring bank to transmit the specified amount to UMB Bank, N.A. with
the information stated above.
11
<PAGE>
Initial Purchase by mail
1. Complete a Purchase Application and indicate the services to be used.
2. Mail the Purchase Application and check payable to "______" to the
Shareholder Servicing Agent at the address set forth above.
Additional purchases by mail.
1. Send a check with a letter of instruction including your account number and
the portfolio and class name, to the appropriate address listed above.
Write your fund account number on the check. If the check is returned to
the Fund because of insufficient funds a $10 fee will be charged.
2. Mail the check to the Shareholder Services Agent at the address set forth
above.
By Automatic Investment Plan (Managed Shares Only)
You may arrange to make investments of $50 or more on a regular basis through
your automatic deductions from your bank checking account. Please call
1-800-537-3177 for more information and enrollment.
Purchase restrictions
The portfolio and KDI each reserves the right to reject or limit purchases of
shares for any reason. Also, from time to time, the portfolio may temporarily
suspend the offering of its shares to new investors. During the period of such
suspension, persons who are already shareholders normally are permitted to
continue to purchase additional shares and to have dividends reinvested.
Processing time
Payment for shares you sell will be made as promptly as practicable but in no
event later than seven days after receipt of a properly executed request. If you
have share certificates, those must accompany your order in proper form for
transfer. When you place an order to sell shares for which the portfolio may not
yet have received good payment (i.e. purchases by check or certain Automated
Clearing House Transactions), a portfolio may delay transmittal of the proceeds
until it has determined that collected funds have been received for the purchase
of such shares. This may be up to 10 days from receipt by the portfolio of the
purchase amount. If shares being redeemed were acquired from an exchange of
shares of a mutual fund that were offered subject to a contingent deferred sales
charge, the redemption of such shares by the portfolio may be subject to a
contingent deferred sales charge as explained in the prospectus for the other
fund.
12
<PAGE>
Redeeming shares
Upon receipt by the Shareholder Servicing Agent of a redemption request in
proper form, shares of the portfolio will be redeemed at their next determined
net asset value. (See "Share Price"). For the shareholders convenience, the
Trust has established several different redemption procedures.
The Trust may suspend the right of redemption during any period when (i) trading
on the Exchange is restricted or the Exchange is closed, (ii) the SEC has by
order permitted such suspension, (iii) an emergency, as defined by rules of the
SEC, exists making disposal of portfolio securities or determination of the
value of the net assets of the portfolio not reasonably practicable.
Redemption by Expedited Redemption Service
If Expedited Redemption Service has been elected on the Purchase Application on
file with the Transfer Agent, redemption of shares may be requested by
telephoning the Transfer Agent on any day the Trust and the Custodian are open
for business.
No redemption of shares purchased by check will be permitted pursuant to the
Expedited Redemption Service until ten business days after those shares have
been credited to the shareholder's account.
1. Telephone the request to the Transfer Agent by calling toll-fee from any
continental state: 1-800-537-3177
2. Fax your request to 1-800-537-9960, or
3. Mail the request to the Shareholder Servicing Agent at the address set
forth above.
Proceeds of Expedited Redemptions will be wired to your bank indicated in the
Purchase Application. If an Expedited Redemption request for the portfolio is
received by the Transfer Agent by 12:00 noon (Eastern time) on a day when the
Trust and the Custodian are open for business, the redemption proceeds will be
transmitted to your bank that same day. Such Expedited Redemption requests
received after 12:00 noon and prior to 4:00 p.m. (Eastern time) will be honored
the same day if such redemption can be accomplished in time to meet the Federal
Reserve Wire System schedules. In the case of investments in the portfolio that
have been effected through banks and other institutions that have entered into
special arrangements with the Trust, the full amount of the redemption proceeds
will be transmitted by wire.
Checkwriting (Managed Shares Only)
You may redeem shares by writing checks against your account balance in amounts
of at least $1,000 but no more than $5 million. A $10 service charge will be
assessed for checks that are written for less than $1,000. If there are
insufficient shares in your account to meet the withdrawal, checks will be
returned and a $10 service charge will be assessed by the portfolio's
shareholder servicing agent.
13
<PAGE>
Your portfolio investments will continue to earn dividends until your check is
presented to the portfolio for payment. You should not attempt to close an
account by check because the exact balance at the time the check clears will not
be known when the check is written.
Redemption by mail.
To redeem shares by mail follow the following instructions:
1. Write a letter of instruction. Indicate the dollar amount or number of
shares to be redeemed. Refer to your portfolio account number and give your
Social Security or taxpayer identification number (where applicable).
2. Sign the letter in exactly the same way the account was registered. If
there is more than one owner of the shares, all must sign.
3. A signature guarantee is required unless you sell shares worth $50,000 or
less and the proceeds are payable to the shareholder of record at the
address of record. You can obtain a guarantee from most brokerage houses
and financial institutions, although not from a notary public. The
Portfolio will normally send you the proceeds within one business day
following your request, but may take up to seven business days (or longer
in the case of shares recently purchased by check).
4. Mail letter to the Shareholder Servicing Agent at the address set forth
under "Initial Purchase By Wire."
Checks for redemption proceeds will normally be mailed the day following receipt
of the request in proper form, although the fund reserves the right to take up
to seven days. Unless other instructions are given in proper form, a check for
proceeds of a redemption will be sent to the shareholder's address of record.
When proceeds are to be paid to someone other than the shareholder, either by
wire or check, the signature(s) on the letter of instruction must be guaranteed
regardless of the amount of the redemption.
Telephone Redemption
To speak with a service representative, call 1-800-537-3177 from 8:30 a.m. to
6:00 p.m. eastern time. You may have redemption proceeds of up to $50,000 sent
to your address of record.
Redemption by Fax
Send your fax to 1-800-537-9960 and include:
o the name of the portfolio and the class and account number you are
redeeming from;
o your name(s) and address as they appear on the account;
14
<PAGE>
o the dollar amount or number of shares you wish to redeem;
o your signature(s) as it appears on your account; and
o a daytime phone number.
A representative will call to confirm your request before processing.
Redemption by Automatic Withdrawal Plan (Managed Shares Only)
You may arrange to receive automatic cash payments periodically. Call
1-800-537-3177 for information and an enrollment form.
Share certificates
When certificates for shares have been issued, they must be mailed to or
deposited with the Transfer Agent, along with a duly endorsed stock power, and
accompanied by a written request for redemption. Redemption requests and a stock
power must be endorsed by an account holder, with signatures guaranteed. The
redemption request and stock power must be signed exactly as the account is
registered, including any special capacity of the registered owner. Additional
documentation may be requested, and a signature guarantee is normally required,
from institutional and fiduciary account holders, such as corporations,
custodians (e.g., under the Uniform Transfer to Minors Act), executors,
administrators, trustees or guardians.
Third party transactions
If you buy and sell shares of the portfolio with the assistance of a financial
service firm (other than the portfolio's distributor), that member may charge a
fee for that service. This prospectus should be read in connection with such
firms' material regarding their fees and services. You should contact your firm
for information concerning purchasing and selling shares.
Redemption-in-kind
The portfolio reserves the right to honor any request for redemption or
repurchase order by "redeeming in kind," that is, by giving you marketable
securities (which typically will involve brokerage costs for you to liquidate)
rather than cash; in most cases, the portfolio won't make a redemption in kind
unless you requests over 90-day period total more than $250,000 or 1% of the
portfolio's assets, whichever is less.
Distributions
The portfolio's dividends are declared daily and distributed monthly to you. Any
dividends or capital gains distributions declared in October, November or
December with a record date in such month and paid during the following January
will be treated by you for federal income tax purposes as if received on
December 31 of the calendar year declared.
15
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A shareholder may choose to receive distributions in cash or have them
reinvested in additional shares of the same class of the portfolio. If an
investment is in the form of a retirement plan, all dividends and capital gains
distributions must be reinvested into your account.
Dividends will be reinvested unless you elect to receive them in cash. The tax
status of dividends is the same whether they are reinvested or paid in cash.
Exchanges among other mutual Funds may also be taxable events.
Taxes
Generally, dividends from net investment income are taxable to shareholders as
ordinary income. Long-term capital gains distributions, if any, are taxable to
shareholders as long-term capital gains, regardless of length of time
shareholders have owned shares. Short-term capital gains and any other taxable
income distributions are taxable as ordinary income. A portion of dividends from
ordinary income may qualify for the dividends-received deduction for
corporations. Dividends received from the Tax-Exempt Portfolio are exempt from
federal income tax.
The portfolio sends detailed tax information about the amount and type of its
distributions by January 31 of the following year.
The portfolio may be required to withhold U.S. federal income tax at the rate of
31% of all taxable distributions payable to shareholders who fail to provide the
portfolio with their correct taxpayer identification number or to make required
certifications, or who have been notified by the IRS that they are subject to
backup withholding. Any such withheld amounts may be credited against the
shareholder's U.S. federal income tax liability.
You may be subject to state, local, and foreign taxes on portfolio distributions
and dispositions of portfolio shares. You should consult your tax advisor
regarding the particular tax consequences of an investment in a portfolio.
16
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Additional information about Institutional and Managed Shares of the portfolio
may be found in the Statement of Additional Information and in shareholder
reports. Shareholder inquiries may be made by calling the toll-free telephone
number listed below. The Statement of Additional Information contains more
detailed information on the portfolio's investments and operations. The
semiannual and annual shareholder reports contain a discussion of the market
conditions and the investment strategies that significantly affected the
portfolio's performance during the last fiscal year, as well as a listing of
portfolio holdings and financial statements. These and other Fund documents may
be obtained without charge from the following sources:
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
<S> <C>
By telephone Call Institutional Funds Client Services at 1-800-537-3177
- ------------------------------------------------------------------------------------------------------------------------
By mail Scudder Kemper Investment, Inc.
222 S. Riverside Plaza, 33rd Floor
Attn: Institutional Client Services
Chicago, IL 60606
or
Public reference Section Securities and Exchange Commission
Washington, D.C. 20549-6009
- ------------------------------------------------------------------------------------------------------------------------
By Fax 1-800-537-9960
- ------------------------------------------------------------------------------------------------------------------------
In Person Public reference Room
Securities and Exchange Commission,
Washington, D.C.
(Call 1-800-SEC-0330)
- ------------------------------------------------------------------------------------------------------------------------
By Internet http://www.sec.gov
------------------
http://institutionalfunds.scudder.com
-------------------------------------
email address: [email protected]
------------------
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</TABLE>
The Statement of Additional Information dated November 10, 1999 is incorporated
by reference into this prospectus (is legally a part of this prospectus).
Investment Company Act file number:
Investors Cash Trust 811-
17
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INVESTORS CASH TRUST
STATEMENT OF ADDITIONAL INFORMATION
November 10, 1999
Government Securities Portfolio
Scudder Government Cash Institutional Shares
Scudder Government Cash Managed Shares
222 South Riverside Plaza, Chicago, Illinois 60606
1-800-231-8568
This Statement of Additional Information contains information about the
Scudder Government Cash Institutional Shares ("Institutional Shares") and
Scudder Government Cash Managed Shares ("Managed Shares")of Government
Securities Portfolio (the "Portfolio) offered by Investors Cash Trust (the
"Trust") an open-end diversified management investment company. This Statement
of Additional Information is not a prospectus and should be read in conjunction
with the prospectus of the Portfolio dated November 10, 1999. The prospectus may
be obtained without charge from the Trust at the address or telephone number on
this cover or the firm from which this Statement of Additional Information was
received and is also available along with other related materials at the SEC's
Internet web site (http://www.sec.gov). The Portfolio's Annual Report, dated
March 31, 1999 is incorporated by reference into and is hereby deemed to be a
part of this Statement of Additional Information.
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TABLE OF CONTENTS
Page
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Investment Restrictions........................... 1
Investment Policies and Techniques................ 2
Investment Manager and Shareholder Services....... 4
Portfolio Transactions............................ 7
Purchase and Redemption of Shares................. 8
Dividends, Taxes and Net Asset Value.............. 11
Performance....................................... 13
Officers and Trustees............................. 15
Special Features.................................. 18
Shareholder Rights................................ 19
The financial statements appearing in the Fund's 1999 Annual Report to
Shareholders are incorporated herein by reference. The Fund's Annual Report
accompanies this Statement of Additional Information, and may be obtained
without charge by calling 1-800-231-8568.
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INVESTMENT RESTRICTIONS
The Trust has adopted for the Portfolio certain investment restrictions which
cannot be changed for the Portfolio without approval by holders of a majority of
its outstanding voting shares. As defined in the Investment Company Act of 1940,
as amended (the "1940 Act"), this means the lesser of the vote of (a) 67% of the
Portfolio's shares present at a meeting where more than 50% of the outstanding
shares of the Portfolio are present in person or by proxy; or (b) more than 50%
of the Portfolio's outstanding shares. Except as otherwise noted, the
Portfolio's investment objective and other policies may be changed by the
Portfolio's Board of Trustees, without a vote of shareholders.
The Fund has elected to be classified as a diversified open-end investment
company.
As a matter of fundamental policy, the Portfolio may not:
1. borrow money, except as permitted under the 1940 Act, and as interpreted or
modified by regulatory authority having jurisdiction, from time to time;
2. issue senior securities, except as permitted under the 1940 Act, and as
interpreted or modified by regulatory authority having jurisdiction, from
time to time;
3. concentrate its investments in a particular industry, as that term is used
in the 1940 Act, and as interpreted or modified by regulatory authority
having jurisdiction, from time to time;
4. engage in the business of underwriting securities issued by others, except
to the extent that the Portfolio may be deemed to be an underwriter in
connection with the disposition of portfolio securities;
5. purchase or sell real estate, which term does not include securities of
companies which deal in real estate or mortgages or investments secured by
real estate or interests therein, except that the Portfolio reserves
freedom of action to hold and to sell real estate acquired as a result of
the Portfolio's ownership of securities;
6. purchase physical commodities or contracts relating to physical
commodities; or
7. make loans, except as permitted under the 1940 Act, and as interpreted or
modified by regulatory authority having jurisdiction, from time to time.
The following policies are non-fundamental, and may be changed or eliminated for
the Portfolio by its Board without a vote of the Portfolio's shareholders:
The Portfolio may not:
1. make short sales of securities, or purchase any securities on margin except
to obtain such short-term credits as may be necessary for the clearance of
transactions,
2. write, purchase, or sell puts, calls or combinations thereof; or
3. purchase any securities other than obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities, and repurchase
agreements of such obligations, except in connection with a master/feeder
fund structure. However, if the Fund implements a master/feeder fund
structure, shareholder approval is required.
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INVESTMENT POLICIES AND TECHNIQUES
Descriptions in this Statement of Additional Information of a particular
investment practice or technique in which the Portfolio may engage or a
financial instrument which the Portfolio may purchase are meant to describe the
spectrum of investments that Scudder Kemper Investments, Inc. (the "Adviser"),
in its discretion, might, but is not required to, use in managing the
Portfolio's assets. The Adviser may, in its discretion, at any time, employ such
practice, technique or instrument for one or more funds but not for all funds
advised by it. Furthermore, it is possible that certain types of financial
instruments or investment techniques described herein may not be available,
permissible, economically feasible or effective for their intended purposes in
all markets. Certain practices, techniques, or instruments may not be principal
activities of the Portfolio, but, to the extent employed, could, from time to
time, have a material impact on the Portfolio's performance.
The Portfolio described in this Statement of Additional seek to provide maximum
current income consistent with the stability of capital. The Portfolio is
managed to maintain a net asset value of $1.00 per share.
The Portfolio will not purchase illiquid securities, including repurchase
agreements maturing in more than seven days, if, as a result thereof, more than
10% of the portfolio's net assets, valued at the time of the transaction, would
be invested in such securities.
The Portfolio seeks maximum current income consistent with stability of capital.
The Portfolio pursues its objective by investing exclusively in U.S. Treasury
bills, notes, bonds and other obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities and repurchase agreements of such
obligations. All securities purchased mature in 12 months or less. Some
securities issued by U.S. Government agencies or instrumentalities are supported
only by the credit of the agency or instrumentality, such as those issued by the
Federal Home Loan Bank; and others have an additional line of credit with the
U.S. Treasury, such as those issued by Fannie Mae and Farm Credit System. Also,
as to securities supported only by the credit of the issuing agency or
instrumentality or by an additional line of credit with the U.S. Treasury, there
is no guarantee that the U.S. Government will provide support to such agencies
or instrumentalities and such securities may involve risk of loss of principal
and interest. The Portfolio's investments in obligations issued or guaranteed by
U.S. Government agencies or instrumentalities currently are limited to those
issued or guaranteed by the following entities: Federal Land Bank, Farm Credit
System, Federal Home Loan Banks, Federal Home Loan Mortgage Corporation, Fannie
Mae, Government National Mortgage Association and Export-Import Credit Bank. The
foregoing list of acceptable entities is subject to change by action of the
Fund's Board of Trustees; however, the Fund will provide written notice to
shareholders at least sixty (60) days before any purchase by the Portfolio of
obligations issued or guaranteed by an entity not named above.
There can be no assurance that the Portfolio's objective can be met.
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Repurchase Agreements. The Portfolio may enter into repurchase agreements with
any member bank of the Federal Reserve System or any domestic broker/dealer
which is recognized as a reporting Government securities dealer, if the
creditworthiness of the bank or broker/dealer has been determined by the Adviser
to be at least as high as that of other obligations the portfolio may purchase
or to be at least equal to that of issuers of commercial paper rated within the
two highest grades assigned by Moody's, S&P or Fitch.
A repurchase agreement provides a means for the Portfolio to earn taxable income
on funds for periods as short as overnight. It is an arrangement under which the
purchaser (i.e., the Portfolio) acquires a security ("Obligation") and the
seller agrees, at the time of sale, to repurchase the Obligation at a specified
time and price. Securities subject to a repurchase agreement are held in a
segregated account, and the value of such securities kept at least equal to the
repurchase price on a daily basis. The repurchase price may be higher than the
purchase price, the difference being income to the Portfolio, or the purchase
and repurchase prices may be the same, with interest at a stated rate due to the
Portfolio together with the repurchase price on the date of repurchase. In
either case, the income to the Portfolio (which is taxable) is unrelated to the
interest rate on the Obligation itself. Obligations will be held by the
custodian or in the Federal Reserve Book Entry system.
For purposes of the 1940 Act, a repurchase agreement is deemed to be a loan from
the Portfolio to the seller of the Obligation subject to the repurchase
agreement, and is therefore subject to that Portfolio's investment restriction
applicable to loans. It is not clear whether a court would consider the
Obligation purchased by the Portfolio subject to a repurchase agreement as being
owned by that Portfolio or as being collateral for a loan by the Portfolio to
the seller. In the event of the commencement of bankruptcy or insolvency
proceedings with respect to the seller of the Obligation before repurchase of
the Obligation under a repurchase agreement, the Portfolio may encounter delay
and incur costs before being able to sell the security. Delays may involve loss
of interest or decline in price of the Obligation. If the court characterized
the transaction as a loan and the Portfolio has not perfected an interest in the
Obligation, that Portfolio may be required to return the Obligation to the
seller's estate and be treated as an unsecured creditor of the seller. As an
unsecured creditor, the Portfolio is at risk of losing some or all of the
principal and income involved in the transaction. As with any unsecured debt
obligation purchased for the Portfolio, the Adviser seeks to minimize the risk
of loss through repurchase agreements by analyzing the creditworthiness of the
obligor, in this case the seller of the Obligation. Apart from the risk of
bankruptcy or insolvency proceedings, there is also the risk that the seller may
fail to repurchase the Obligation, in which case the Portfolio may incur a loss
if the proceeds to the Portfolio of the sale to a third party are less than the
repurchase price. However, if the market value of the Obligation subject to the
repurchase agreement becomes less than the repurchase price (including
interest), the Portfolio will direct the seller of the Obligation to deliver
additional securities so that the market value of all securities subject to the
repurchase agreement will equal or exceed the repurchase price. It is possible
that the Portfolio will be unsuccessful in seeking to enforce the seller's
contractual obligation to deliver additional securities.
Repurchase agreements are instruments under which the Portfolio acquires
ownership of a U.S. Government security from a broker-dealer or bank that agrees
to repurchase the U.S. Government security at a mutually agreed upon time and
price (which price is higher than the purchase price), thereby determining the
yield during the Portfolio's holding period. Maturity of the securities subject
to repurchase may exceed one year. In the event of a bankruptcy or other default
of a seller of a repurchase agreement, the Portfolio might incur expenses in
enforcing its rights, and could experience losses, including a decline in the
value of the underlying securities and loss of income. Currently, the Portfolio
will only enter into repurchase agreements with primary U.S. Government
securities dealers recognized by the Federal Reserve Bank of New York that have
been approved pursuant to procedures adopted by the Board of Trustees of the
Fund. The Portfolio will not purchase illiquid securities including repurchase
agreements maturing in more than seven days if, as a result thereof, more than
10% of the Portfolio's net assets valued at the time of the transaction would be
invested in such securities.
The Portfolio may invest in U.S. Government securities having rates of interest
that are adjusted periodically or which "float" continuously according to
formulae intended to minimize fluctuation in values of the instruments
("Variable Rate Securities"). The interest rate of Variable Rate Securities
ordinarily is determined by reference to or is a percentage of an objective
standard such as a bank's prime rate, the 90-day U.S. Treasury Bill rate, or the
rate of return on commercial paper or bank certificates of deposit. Generally,
the changes in the interest rate on Variable Rate Securities
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reduce the fluctuation in the market value of such securities. Accordingly, as
interest rates decrease or increase, the potential for capital appreciation or
depreciation is less than for fixed-rate obligations. Some Variable Rate
Securities ("Variable Rate Demand Securities") have a demand feature entitling
the purchaser to resell the securities at an amount approximately equal to
amortized cost or the principal amount thereof plus accrued interest. As is the
case for other Variable Rate Securities, the interest rate on Variable Rate
Demand Securities varies according to some objective standard intended to
minimize fluctuation in the values of the instruments. The Portfolio determines
the maturity of Variable Rate Securities in accordance with Rule 2a-7, which
allows the Portfolio to consider certain of such instruments as having
maturities shorter than the maturity date on the face of the instrument.
INVESTMENT MANAGER AND SHAREHOLDER SERVICES
Investment Manager. Scudder Kemper Investments, Inc., 345 Park Avenue, New York,
New York, is the Fund's investment manager. The Adviser is approximately 70%
owned by Zurich Insurance Company, a leading internationally recognized provider
of insurance and financial services in property/casualty and life insurance,
reinsurance and structured financial solutions as well as asset management. The
balance of Scudder Kemper is owned by Scudder Kemper's officers and employees.
Responsibility for overall management of the Portfolio rests with the Fund's
Board of Trustees and officers. Pursuant to an investment management agreement,
the Adviser acts as the Portfolio's investment adviser, manages its investments,
administers its business affairs, furnishes office facilities and equipment,
provides clerical and administrative services and permits any of its officers or
employees to serve without compensation as trustees or officers of the Fund if
elected to such positions. The Fund pays the expenses of its operations,
including the fees and expenses of independent auditors, counsel, custodian and
transfer agent and the cost of share certificates, reports and notices to
shareholders, costs of calculating net asset value and maintaining all
accounting records related thereto, brokerage commissions or transaction costs,
taxes, registration fees, the fees and expenses of qualifying the Fund and its
shares for distribution under federal and state securities laws and membership
dues in the Investment Company Institute or any similar organization. The Fund's
expenses generally are allocated between the Portfolios on the basis of relative
net assets at the time of allocation, except that expenses directly attributable
to a particular Portfolio are charged to that Portfolio.
The agreement provides that the Adviser shall not be liable for any error of
judgment or of law, or for any loss suffered by the Fund in connection with the
matters to which the agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the part of the Adviser in the
performance of its obligations and duties, or by reason of its reckless
disregard of its obligations and duties under the agreement.
The investment management agreement continues in effect from year to year so
long as its continuation is approved at least annually by (a) a majority vote of
the trustees who are not parties to such agreement or interested persons of any
such party except in their capacity as trustees of the Fund, cast in person at a
meeting called for such purpose, and (b) by the shareholders of the Portfolio or
the Board of Trustees. If continuation is not approved for the Portfolio, the
investment management agreement nevertheless may continue in effect for any
Portfolio for which it is approved, and the Adviser may continue to serve as
investment manager for the Portfolio for which it is not approved to the extent
permitted by the 1940 Act. It may be terminated at any time upon 60 days' notice
by either party, or by a majority vote of the outstanding shares, and will
terminate automatically upon assignment.
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On December 31, 1997, pursuant to the terms of an agreement, Scudder, Stevens &
Clark, Inc. ("Scudder"), and Zurich Insurance Company ("Zurich"), formed a new
global investment organization by combining Scudder with Zurich Kemper
Investments, Inc. ("ZKI") and Zurich Kemper Value Advisors, Inc. ("ZKVA"),
former subsidiaries of Zurich. ZKI was the former investment manager for the
Portfolio. Upon completion of the transaction, Scudder changed its name to
Scudder Kemper Investments, Inc. As a result of the transaction, Zurich owns
approximately 70% of Scudder Kemper, with the balance owned by Scudder Kemper's
officers and employees.
On September 7, 1998, the businesses of Zurich (including Zurich's 70% interest
in the Adviser) and the financial services businesses of B.A.T Industries p.l.c.
("B.A.T") were combined to form a new global insurance and financial services
company known as Zurich Financial Services Group. By way of a dual holding
company structure, former Zurich shareholders initially owned approximately 57%
of Zurich Financial Services Group, with the balance initially owned by former
B.A.T shareholders.
Upon consummation of this transaction, the Portfolios' then current investment
management agreement with the Adviser was deemed to have been assigned and,
therefore, terminated. The Board approved a new investment management agreement
(the "Agreement") with the Adviser, which is substantially identical to the
prior investment management agreement, except for the date of execution and
termination. The Agreement became effective on September 7, 1998, upon the
termination of the then current investment management agreement, and was
approved at a shareholder meeting held in December 1998.
The Agreement, dated September 7, 1998, was approved by the Trustees of the Fund
on August 11, 1998. The Agreement will continue in effect until September 30,
1999 and from year to year thereafter only if its continuance is approved
annually by the vote of a majority of those Trustees who are not parties to such
Agreement or interested persons of the Adviser or the Fund, cast in person at a
meeting called for the purpose of voting on such approval, and either by a vote
of the Fund's Trustees or of a majority of the outstanding voting securities of
the Fund. The Agreement may be terminated at any time without payment of penalty
by either party on sixty days' written notice, and automatically terminates in
the event of its assignment.
For services and facilities furnished, the Fund pays a monthly investment
management fee of 1/12 of 0.15% of average daily net assets of the Government
Portfolio and Treasury Portfolios (a separate portfolio of the Fund). The
investment management fee is computed based on the combined average daily net
assets of all Portfolios and allocated between the Portfolios based upon the
relative net asset levels. Pursuant to the investment management agreement, the
Fund incurred investment management fees for the Government Securities Portfolio
of $535,000,$342,000 and $320,000 for the fiscal years ended March 31, 1999,
1998 and 1997, respectively. By contract, the Adviser and certain affiliates
have agreed to limit operating expenses to 0.25% of average daily net assets of
the Portfolio on an annual basis until July 31, 2000. For this purpose,
"Portfolio operating expenses" do not include taxes, interest, extraordinary
expenses, brokerage commissions or transaction costs. During the fiscal years
ended March 31, 1999, 1998, 1997, under expense limits then in effect, the
Adviser (or an affiliate) absorbed $308,000, $294,000 and $150,000,
respectively, of the Government Securities Portfolio's operating expenses.
Certain trustees or officers of the Fund are also directors or officers of the
Adviser and its affiliates as indicated under "Officers and Trustees."
Fund Accounting Agent. Scudder Fund Accounting Corporation ("SFAC"), Two
International Place, Boston, Massachusetts 02110, a subsidiary of the Adviser,
is responsible for determining the daily net asset value per share
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of the Portfolio and maintaining all accounting records related thereto.
Currently, SFAC receives no fee for its services to the Fund; however, subject
to Board approval, at some time in the future, SFAC may seek payment for its
services under this agreement.
Distributor and Administrator. Pursuant to an underwriting and distribution
agreement ("distribution agreement"), Kemper Distributors, Inc. ("KDI"), 222
South Riverside Plaza, Chicago, Illinois 60606, an affiliate of the Adviser,
serves as distributor and principal underwriter for the Trust to provide
information and services for existing and potential shareholders. The
distribution agreement provides that KDI shall appoint various firms to provide
cash management services for their customers or clients through the Trust.
As principal underwriter for the Trust, KDI acts as agent of the Trust in the
sale of its shares of the Portfolio. KDI pays all its expenses under the
distribution agreement. The Trust pays the cost for the prospectus and
shareholder reports to be set in type and printed for existing shareholders, and
KDI pays for the printing and distribution of copies thereof used in connection
with the offering of shares to prospective investors. KDI also pays for
supplementary sales literature and advertising costs. KDI has related selling
group agreements with various firms to provide distribution services for Fund
shareholders. KDI receives no compensation from the Trust as principal
underwriter for the Shares and pays all expenses of distribution of the Shares
not otherwise paid by dealers and other financial services firms. KDI may, from
time to time, pay or allow discounts, commissions or promotional incentives, in
the form of cash, to firms that sell shares of the Portfolio.
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The distribution agreement continues in effect from year to year so long as
such continuance is approved at least annually by a vote of the Board of
Trustees of the Trust, including the Trustees who are not interested persons of
the Trust and who have no direct or indirect financial interest in the
agreement. The distribution agreement automatically terminates in the event of
its assignment and may be terminated at any time without penalty by the Trust or
by KDI upon 60 days' written notice. Termination of the distribution agreement
by the Trust may be by vote of a majority of the Board of Trustees, or a
majority of the Trustees who are not interested persons of the Trust and who
have no direct or indirect financial interest in the agreement, or a "majority
of the outstanding voting securities" of the Trust as defined under the 1940
Act.
Administrative services are provided to the Managed Shares of the Portfolio
under an administration services agreement ("administration agreement") with
KDI. KDI bears all its expenses of providing services pursuant to the
administration agreement between KDI and the Managed Shares of the Portfolio,
including the payment of service fees. Managed Shares of the Portfolio currently
pay KDI an administrative services fee, payable monthly, at an annual rate of up
to 0.15% of average daily net assets attributable to those shares of the
Portfolio. In the discretion of the Board of Trustees of the Trust, the
administrative service fee may be increased to 0.25% of the average daily net
assets.
KDI has entered into related arrangements with various banks, broker-dealer
firms and other service or administrative firms ("firms") that provide services
and facilities for their customers or clients who are investors in Managed
Shares of the Portfolio. The firms provide such office space and equipment,
telephone facilities and personnel as is necessary or beneficial for providing
information and services to their clients. Such services and assistance may
include, but are not limited to, establishing and maintaining accounts and
records, processing purchase and redemption transactions, answering routine
inquiries regarding the Portfolio, assistance to clients in changing dividend
and investment options, account designations and addresses and such other
administrative services as may be agreed upon from time to time and permitted by
applicable statute, rule or regulation. Currently, KDI pays each firm a service
fee, normally payable monthly, at an annual rate of up to 0.15% of the net
assets in the Portfolio's Managed Share accounts that it maintains and services.
Firms to which service fees may be paid may include affiliates of KDI.
In addition, KDI may from time to time, from its own resources pay certain firms
additional amounts for ongoing administrative services and assistance provided
to their customers and clients who are shareholders of the Managed Portfolio.
KDI also may provide some of the above services and may retain any portion of
the fee under the administrative agreement not paid to firms to compensate
itself for administrative functions performed for the Managed Shares of the
Portfolio.
Custodian, Transfer Agent and Shareholder Service Agent. State Street Bank and
Trust Company ("State Street"), 225 Franklin Street, Boston, Massachusetts
02110, as custodian, has custody of all securities and cash of the Fund. State
Street attends to the collection of principal and income, and payment for and
collection of proceeds of securities bought and sold by the Fund. Investors
Fiduciary Trust Company ("IFTC"), 801 Pennsylvania Avenue, Kansas City, Missouri
64105, is the transfer agent of the Fund. Pursuant to a services agreement with
IFTC, Kemper Service Company, an affiliate of the Adviser, serves as
"Shareholder Service Agent." IFTC receives, as transfer agent, and pays to the
Shareholder Service Agent annual account fees of a maximum of $13 per year per
account plus out-of-pocket expense reimbursement. During the fiscal year ended
March 31, 1999 and 1998, IFTC remitted shareholder service fees in the amount of
$41,000 and $26,000, respectively, to the Shareholder Service Agent.
Firms provide varying arrangements for their clients with respect to the
purchase and redemption of Portfolio shares and the confirmation thereof. Such
firms are responsible for the prompt transmission of purchase and redemption
orders. Some firms may establish higher minimum investment requirements than set
forth below. A firm may arrange with its clients for other investment or
administrative services. Such firms may independently establish and charge
additional amounts to their clients for such services, which charges would
reduce the clients' yield or return. Firms may also hold Portfolio shares in
nominee or street name as agent for and on behalf of their clients. In such
instances, the Trust's transfer agent will have no information with respect to
or control over the accounts of specific
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shareholders. Such shareholders may obtain access to their accounts and
information about their accounts only from their firm. Certain of these firms
may receive compensation from the Managed Shares of the Portfolio for
recordkeeping and other expenses relating to these nominee accounts. In
addition, certain privileges with respect to the purchase and redemption of
shares (such as check writing redemptions) or the reinvestment of dividends may
not be available through such firms or may only be available subject to
conditions and limitations. Some firms may participate in a program allowing
them access to their clients' accounts for servicing including, without
limitation, transfers of registration and dividend payee changes; and may
perform functions such as generation of confirmation statements and disbursement
of cash dividends. The prospectus should be read in connection with such firm's
material regarding its fees and services.
Independent Auditors and Reports To Shareholders. The Fund's independent
auditors, Ernst & Young LLP, 233 South Wacker Drive, Chicago, Illinois 60606,
audit and report on the Fund's annual financial statements, review certain
regulatory reports and the Fund's federal income tax return, and perform other
professional accounting, auditing, tax and advisory services when engaged to do
so by the Fund. Shareholders will receive annual audited financial statements
and semi-annual unaudited financial statements.
Legal Counsel. Vedder, Price, Kaufman & Kammholz, 222 North LaSalle Street,
Chicago, Illinois, 60601, serves as legal counsel for the Fund.
PORTFOLIO TRANSACTIONS
Brokerage
Allocation of brokerage is supervised by the Adviser.
The primary objective of the Adviser in placing orders for the purchase and sale
of securities for a Portfolio is to obtain the most favorable net results taking
into account such factors as price, commission where applicable, size of order,
difficulty of execution and skill required of the executing broker-dealer. The
Adviser seeks to evaluate the overall reasonableness of brokerage commissions
paid (to the extent applicable) through its familiarity with commissions charged
on comparable transactions, as well as by comparing commissions paid by the
Portfolio to reported commissions paid by others. The Adviser reviews on a
routine basis commission rates, execution and settlement services performed,
making internal and external comparisons.
When it can be done consistently with the policy of obtaining the most favorable
net results, it is the Adviser's practice to place such orders with
broker-dealers who supply research, market and statistical information to a
Fund. The term "research, market and statistical information" includes advice as
to the value of securities: the advisability of investing in, purchasing or
selling securities; the availability of securities or purchasers or sellers of
securities; and analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and the performance of accounts.
The Adviser is authorized when placing portfolio transactions for a Fund to pay
a brokerage commission in excess of that which another broker might charge for
executing the same transaction solely on account of the receipt of research,
market or statistical information. In effecting transactions solely on account
of the receipt of research, market or statistical information. The Adviser may
place orders with a broker-dealer on the basis that the broker-dealer has or has
not sold shares of the Portfolio. In effecting transactions in over-the-counter
securities, orders are placed with the principal market makers for the security
being traded unless, after exercising care, it appears that more favorable
results are available elsewhere.
In selecting among firms believed to meet the criteria for handling a particular
transaction, the Adviser may give consideration to those firms that have sold or
are selling shares of a Fund managed by the Adviser.
To the maximum extent feasible, it is expected that the Adviser will place
orders for portfolio transactions through Scudder Investor Services, Inc.
("SIS"), a corporation registered as a broker-dealer and a subsidiary of the
Adviser.
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SIS will place orders on behalf of the Fund with issuers, underwriters
or other brokers and dealers. SIS will not receive any commission, fee or other
remuneration from the Fund for this service.
Although certain research, market and statistical information from
broker-dealers may be useful to the Portfolio and to the Adviser, it is the
opinion of the Adviser that such information only supplements its own research
effort since the information must still be analyzed, weighed and reviewed by the
Adviser's staff. Such information may be useful to the Adviser in providing
services to clients other than the Portfolio and not all such information is
used by the Adviser in connection with the Portfolio. Conversely, such
information provided to the Adviser by broker-dealers through whom other clients
of the Adviser effect securities transactions may be useful to the Adviser in
providing services to the Portfolio.
The Trustees review, from time to time, whether the recapture for the benefit of
the Portfolio of some portion of the brokerage commissions or similar fees paid
by the Portfolio on portfolio transactions is legally permissible and advisable.
A fund's average portfolio turnover rate is the ratio of the lesser of sales or
purchases to the monthly average value of the portfolio securities owned during
the year, excluding all securities with maturities or expiration dates at the
time of acquisition of one year or less. A higher rate involves greater
brokerage transaction expenses to the Portfolio and may result in the
realization of net capital gains, which would be taxable to shareholders, when
distributed. Purchases and sales are made for a fund's portfolio whenever
necessary, in management's opinion, to meet a Fund's objective.
Money market instruments are normally purchased in principal transactions
directly from the issuer or from an underwriter or market maker. There usually
are no brokerage commissions paid by the Portfolio for such purchases. During
the last three fiscal years the Portfolio paid no portfolio brokerage
commissions. Purchases from underwriters will include a commission or concession
paid by the issuer to the underwriter, and purchases from dealers serving as
market makers will include the spread between the bid and asked prices.
PURCHASE AND REDEMPTION OF SHARES
Purchase of Shares
Shares of the Portfolio are sold at their net asset value next determined after
an order and payment are received in the form described in the prospectus. The
minimum initial investment is $1 million for Institutional Shares. The minimum
initial investment for managed shares is $100,000 and $1,000 for each subsequent
investment. Such minimum amount may be changed at any time for each class. The
Fund may waive the minimum for purchases by trustees, directors, officers or
employees of the Fund or the Adviser and its affiliates. An investor wishing to
open an account should use the Account Application available from the Fund or
financial services firms. Orders for the purchase of shares that are accompanied
by a check drawn on a foreign bank (other than a check drawn on a Canadian bank
in U.S. Dollars) will not be considered in proper form and will not be processed
unless and until the Fund determines that it has received payment of the
proceeds of the check. The time required for such a determination will vary and
cannot be determined in advance.
Redemption of Shares
General. Upon receipt by the Shareholder Service Agent of a request in the form
described below, shares of the Portfolio will be redeemed by the Fund at the
next determined net asset value. If processed at 3:00 p.m. Central time, the
shareholder will receive that day's dividend. A shareholder may use either the
regular or expedited redemption procedures. Shareholders who redeem all their
shares of the Portfolio will receive the net asset value of such shares and all
declared but unpaid dividends on such shares.
If shares of the Portfolio to be redeemed were purchased by check or through
certain Automated Clearing House ("ACH") transactions, the Fund may delay
transmittal of redemption proceeds until it has determined that collected funds
have been received for the purchase of such shares, which will be up to 10 days
from receipt by the Fund of the purchase amount. Shareholders may not use ACH or
Redemption Checks (see "Redemptions by Draft") until the shares
9
<PAGE>
being redeemed have been owned for at least 10 days and shareholders may not use
such procedures to redeem shares held in certificated form. There is no delay
when shares being redeemed were purchased by wiring Federal Funds.
The Fund may suspend the right of redemption or delay payment more than seven
days (a) during any period when the New York Stock Exchange ("Exchange") is
closed other than customary weekend and holiday closings or during any period in
which trading on the Exchange is restricted, (b) during any period when an
emergency exists as a result of which (i) disposal of the Portfolio's
investments is not reasonably practicable, or (ii) it is not reasonably
practicable for the Fund to determine the value of its net assets, or (c) for
such other periods as the Securities and Exchange Commission may by order permit
for the protection of the Fund's shareholders.
Although it is the Fund's present policy to redeem in cash, if the Board of
Trustees determines that a material adverse effect would be experienced by the
remaining shareholders if payment were made wholly in cash, the Fund will pay
the redemption price in whole or in part by a distribution of portfolio
securities in lieu of cash, in conformity with the applicable rules of the
Securities and Exchange Commission, taking such securities at the same value
used to determine net asset value, and selecting the securities in such manner
as the Board of Trustees may deem fair and equitable. If such a distribution
occurs, shareholders receiving securities and selling them could receive less
than the redemption value of such securities and in addition would incur certain
transaction costs. Such a redemption would not be as liquid as a redemption
entirely in cash. The Fund has elected to be governed by Rule 18f-1 under the
1940 Act, pursuant to which the Fund is obligated to redeem shares of the
Portfolio solely in cash up to the lesser of $250,000 or 1% of the net assets of
the Portfolio during any 90-day period for any one shareholder of record.
If shares being redeemed were acquired from an exchange of shares of a mutual
fund that were offered subject to a contingent deferred sales charge as
described in the prospectus for that other fund, the redemption of such shares
by the Fund may be subject to a contingent deferred sales charge as explained in
such prospectus.
Shareholders can request the following telephone privileges: expedited wire
transfer redemptions, ACH transactions and exchange transactions for individual
and institutional accounts and pre-authorized telephone redemption transactions
for certain institutional accounts. Shareholders may choose these privileges on
the account application or by contacting the Shareholder Service Agent for
appropriate instructions. Please note that the telephone exchange privilege is
automatic unless the shareholder refuses it on the account application. The Fund
or its agents may be liable for any losses, expenses or costs arising out of
fraudulent or unauthorized telephone requests pursuant to these privileges,
unless the Fund or its agents reasonably believe, based upon reasonable
verification procedures, that the telephone instructions are genuine. The
shareholder will bear the risk of loss, resulting from fraudulent or
unauthorized transactions, as long as the reasonable verification procedures are
followed. The verification procedures include recording instructions, requiring
certain identifying information before acting upon instructions and sending
written confirmations.
Because of the high cost of maintaining small accounts, the Fund reserves the
right to redeem an account that falls below the minimum investment level. Thus,
a shareholder who makes only the minimum initial investment and then redeems any
portion thereof might have the account redeemed. A shareholder will be notified
in writing and will be allowed 60 days to make additional purchases to bring the
account value up to the minimum investment level before the Fund redeems the
shareholder account.
Financial services firms provide varying arrangements for their clients to
redeem Fund shares. Such firms may independently establish and charge amounts to
their clients for such services.
Regular Redemptions. When shares are held for the account of a shareholder by
the Fund's transfer agent, the shareholder may redeem them by sending a written
request with signatures guaranteed (if applicable) to Kemper Service Company,
P.O. Box 419153, Kansas City, Missouri 64141-6153. When certificates for shares
have been issued, they must be mailed to or deposited with the Shareholder
Service Agent, along with a duly endorsed stock power and accompanied by a
written request for redemption. Redemption requests and a stock power must be
endorsed by the account holder with signatures guaranteed by a commercial bank,
trust company, savings and loan association, federal savings bank, member firm
of a national securities exchange or other eligible financial institution. The
redemption request and stock power must be signed exactly as the account is
registered including any special capacity of the registered owner. Additional
documentation may be requested, and a signature guarantee is normally required,
10
<PAGE>
from institutional and fiduciary account holders, such as corporations,
custodians (e.g., under the Uniform Transfers to Minors Act), executors,
administrators, trustees or guardians.
Telephone Redemptions. If the proceeds of the redemption are [$50,000] or less
and the proceeds are payable to the shareholder of record at the address of
record, normally a telephone request or a written request by any one account
holder without a signature guarantee is sufficient for redemptions by individual
or joint account holders, and trust, executor, guardian and custodian account
holders, provided the trustee, executor guardian or custodian is named in the
account registration. Other institutional account holders may exercise this
special privilege of redeeming shares by telephone request or written request
without signature guarantee subject to the same conditions as individual account
holders and subject to the limitations on liability described under "General"
above, provided that this privilege has been pre-authorized by the institutional
account holder or guardian account holder by written instruction to the
Shareholder Service Agent with signatures guaranteed. Telephone requests may be
made by calling 1-800-537-3177. Shares purchased by check or through certain ACH
transactions may not be redeemed under this privilege of redeeming shares by
telephone request until such shares have been owned for at least 10 days. This
privilege of redeeming shares by telephone request or by written request without
a signature guarantee may not be used to redeem shares held in certificated form
and may not be used if the shareholder's account has had an address change
within 30 days of the redemption request. During periods when it is difficult to
contact the Shareholder Service Agent by telephone, it may be difficult to use
the telephone redemption privilege, although investors can still redeem by mail.
The Fund reserves the right to terminate or modify this privilege at any time.
Expedited Wire Transfer Redemptions. If the account holder has given
authorization for expedited wire redemption to the account holder's brokerage or
bank account, shares can be redeemed and proceeds sent by a federal wire
transfer to a single previously designated account. Requests received by the
Shareholder Service Agent prior to 11:00 a.m. Central time will result in shares
being redeemed that day and normally the proceeds will be sent to the designated
account that day. Once authorization is on file, the Shareholder Service Agent
will honor requests by telephone at 1-800-337-3177 or in writing, subject to the
limitations on liability described under "General" above. The Fund is not
responsible for the efficiency of the federal wire system or the account
holder's financial services firm or bank. The Fund currently does not charge the
account holder for wire transfers. The account holder is responsible for any
charges imposed by the account holder's firm or bank. There is a $1,000 wire
redemption minimum. To change the designated account to receive wire redemption
proceeds, send a written request to the Shareholder Service Agent with
signatures guaranteed as described above, or contact the firm through which
shares of the Fund were purchased. Shares purchased by check or through certain
ACH transactions may not be redeemed by wire transfer until the shares have been
owned for at least 10 days. Account holders may not use this procedure to redeem
shares held in certificated form. During periods when it is difficult to contact
the Shareholder Service Agent by telephone, it may be difficult to use the
expedited wire transfer redemption privilege. The Fund reserves the right to
terminate or modify this privilege at any time.
Redemptions By Draft. (Managed Shares Only) Upon request, shareholders will be
provided with drafts to be drawn on the Fund ("Redemption Checks"). These
Redemption Checks may be made payable to the order of any person for not more
than $5 million. Shareholders should not write Redemption Checks in an amount
less than [$1,000]. A $10 service fee will be charged as described below. When a
Redemption Check is presented for payment, a sufficient number of full and
fractional shares in the shareholder's account will be redeemed as of the next
determined net asset value to cover the amount of the Redemption Check. This
will enable the shareholder to continue earning dividends until the Fund
receives the Redemption Check. A shareholder wishing to use this method of
redemption must complete and file an Account Application which is available from
the Fund or firms through which shares were purchased. Redemption Checks should
not be used to close an account since the account normally includes accrued but
unpaid dividends. The Fund reserves the right to terminate or modify this
privilege at any time. This privilege may not be available through some firms
that distribute shares of the Fund. In addition, firms may impose minimum
balance requirements in order to offer this feature. Firms may also impose fees
to investors for this privilege or establish variations of minimum check amounts
if approved by the Fund.
Unless one signer is authorized on the Account Application, Redemption Checks
must be signed by all account holders. Any change in the signature authorization
must be made by written notice to the Shareholder Service Agent. Shares
purchased by check or through certain ACH transactions may not be redeemed by
Redemption Check until the shares have been on the Fund's books for at least 10
days. Shareholders may not use this procedure to redeem shares held in
certificated form. The Fund reserves the right to terminate or modify this
privilege at any time.
11
<PAGE>
The Fund may refuse to honor Redemption Checks whenever the right of redemption
has been suspended or postponed, or whenever the account is otherwise impaired.
A $10 service fee will be charged when a Redemption Check is presented to redeem
Fund shares in excess of the value of a Fund account or in an amount less than
$1,000; when a Redemption Check is presented that would require redemption of
shares that were purchased by check or certain ACH transactions within 10 days;
or when "stop payment" of a Redemption Check is requested.
DIVIDENDS, TAXES AND NET ASSET VALUE
Dividends. Dividends are declared daily and paid monthly. Shareholders will
receive cash dividends unless they elect to receive dividends in additional
shares. For cash dividends, checks will be mailed or proceeds wired within five
business days after the reinvestment date described below. For dividends paid in
additional shares, dividends will be reinvested monthly in shares of the same
Portfolio normally on the first day of each month, if a business day, otherwise
on the next business day. The Fund will pay shareholders who redeem their entire
accounts all unpaid dividends at the time of redemption not later than the next
dividend payment date.
The Portfolio calculates its dividends based on its daily net investment income.
For this purpose, net investment income consists of (a) accrued interest income
plus or minus amortized discount or premium, (b) plus or minus all short-term
realized gains and losses on investments and (c) minus accrued expenses.
Expenses of the Portfolio are accrued each day. Since the Portfolio's
investments are valued at amortized cost, there will be no unrealized gains or
losses on such investments. However, should the net asset value of the Portfolio
deviate significantly from market value, the Board of Trustees could decide to
value the investments at market value and then unrealized gains and losses would
be included in net investment income above.
Dividends are paid in cash monthly and shareholders will receive monthly
confirmation of dividends and of purchase and redemption transactions.
Shareholders may select one of the following ways to receive dividends:
1. Receive Dividends in Cash. Checks will be mailed monthly, within five
business days of the reinvestment date (described below), to the shareholder or
any person designated by the shareholder. At the option of the shareholder, cash
dividends may be sent by Federal Funds wire. Shareholders may request to have
dividends sent by wire on the Account Application or by contacting the
Shareholder Service Agent. Dividends will be received in cash unless the
shareholder elects to have them reinvested. If an investment is in the form of a
retirement plan, all dividends and capital gains distributions must be
reinvested into the shareholder's account.
2. Reinvest Dividends at net asset value into additional shares of the same
Portfolio if so requested. Dividends are reinvested on the 1st day of each month
if a business day, otherwise on the next business day.
The Portfolio reinvests dividend checks (and future dividends) in shares of the
Portfolio if checks are returned as undeliverable. Dividends and other
distributions in the aggregate amount of $10 or less are automatically
reinvested in shares of the Fund unless the shareholder requests that such
policy not be applied to the shareholder's account.
Taxes. The Portfolio intends to continue to qualify as a regulated investment
company under Subchapter M of the Internal Revenue Code (the "Code") and, if so
qualified, will not be subject to Federal income taxes to the extent its
earnings are distributed. Dividends derived from interest and short-term capital
gains are taxable as ordinary income whether received in cash or reinvested in
additional shares. Dividends from the Portfolio do not qualify for the dividends
received deduction available to corporate shareholders.
If for any taxable year the Portfolio does not qualify for the special federal
income tax treatment afforded regulated investment companies, all of its taxable
income will be subject to federal income tax at regular corporate rates (without
any deduction for distributions to its shareholders). In such event, dividend
distributions would be taxable to shareholders to the extent of current
accumulated earnings and profits, and would be eligible for the dividends
received deduction, in the case of corporate shareholders.
Dividends declared in October, November or December to shareholders of record as
of a date in one of those months and paid during the following January are
treated as paid on December 31 of the calendar year in which declared for
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<PAGE>
federal income tax purposes. The Fund may adjust its schedule for dividend
reinvestment for the month of December to assist it in complying with reporting
and minimum distribution requirements contained in the Code.
The Code restricts the ability to invest tax-exempt bond proceeds at yields
materially higher than the yield on the issue. Tax advisers should be consulted
before investing tax-exempt bond proceeds in the Portfolio.
Portfolio dividends that are derived from interest on direct obligations of the
U.S. Government and certain of its agencies and instrumentalities may be exempt
from state and local taxes in certain states. In other states, arguments can be
made that such distributions should be exempt from state and local taxes based
on federal law, 31 U.S.C. Section 3124, and the U.S. Supreme Court's
interpretation of that provision in AMERICAN BANK AND TRUST CO. v. DALLAS
COUNTY, 463 U.S. 855 (1983). The Fund currently intends to advise shareholders
of the proportion of its dividends that consists of such interest. Shareholders
should consult their tax advisers regarding the possible exclusion of such
portion of their dividends for state and local income tax purposes.
The Portfolio is required by law to withhold 31% of taxable dividends paid to
certain shareholders who do not furnish a correct taxpayer identification number
(in the case of individuals, a social security number) and in certain other
circumstances. Trustees of qualified retirement plans and 403(b)(7) accounts are
required by law to withhold 20% of the taxable portion of any distribution that
is eligible to be "rolled over." The 20% withholding requirement does not apply
to distributions from IRAs or any part of a distribution that is transferred
directly to another qualified retirement plan, 403(b)(7) account, or IRA.
Shareholders should consult their tax advisers regarding the 20% withholding
requirements.
Shareholders normally will receive monthly confirmations of dividends and of
purchase and redemption transactions except that confirmations of dividend
reinvestment for fiduciary accounts for which Investors Fiduciary Trust Company
serves as trustee will be sent quarterly. Firms may provide varying arrangements
with their clients with respect to confirmations. Tax information will be
provided annually. Shareholders are encouraged to retain copies of their account
confirmation statements or year-end statements for tax reporting purposes.
However, those who have incomplete records may obtain historical account
transaction information at a reasonable fee.
Net Asset Value. As described in the prospectus, the Portfolio values its
portfolio instruments at amortized cost, which does not take into account
unrealized capital gains or losses. This involves valuing an instrument at its
cost and thereafter assuming a constant amortization to maturity of any discount
or premium, regardless of the impact of fluctuating interest rates on the market
value of the instrument. While this method provides certainty in valuation, it
may result in periods during which value, as determined by amortized cost, is
higher or lower than the price the Portfolio would receive if it sold the
instrument. Calculations are made to compare the value of the Portfolio's
investments valued at amortized cost with market values. Market valuations are
obtained by using actual quotations provided by market makers, estimates of
market value, or values obtained from yield data relating to classes of money
market instruments published by reputable sources at the mean between the bid
and asked prices for the instruments. If a deviation of 1/2 of 1% or more were
to occur between the net asset value per share calculated by reference to market
values and the Portfolio's $1.00 per share net asset value, or if there were any
other deviation which the Board of Trustees of the Fund believed would result in
a material dilution to shareholders or purchasers, the Board of Trustees would
promptly consider what action, if any, should be initiated. If the Portfolio's
net asset value per share (computed using market values) declined, or were
expected to decline, below $1.00 (computed using amortized cost), the Board of
Trustees of the Fund might temporarily reduce or suspend dividend payments in an
effort to maintain the net asset value at $1.00 per share. As a result of such
reduction or suspension of dividends or other action by the Board of Trustees,
an investor would receive less income during a given period than if such a
reduction or suspension had not taken place. Such action could result in
investors receiving no dividend for the period during which they held their
shares and receiving, upon redemption, a price per share lower than that which
they paid. On the other hand, if the Portfolio's net asset value per share
(computed using market values) were to increase, or were anticipated to increase
above $1.00 (computed using amortized cost), the Board of Trustees of the Fund
might supplement dividends in an effort to maintain the net asset value at $1.00
per share.
PERFORMANCE
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<PAGE>
From time to time, the Fund may advertise several types of performance
information for the Portfolio, including "yield" and "effective yield." Each of
these figures is based upon historical earnings and is not representative of the
future performance of the Portfolio. The yield of the Portfolio refers to the
net investment income generated by a hypothetical investment in the Portfolio
over a specific seven-day period. This net investment income is then annualized,
which means that the net investment income generated during the seven-day period
is assumed to be generated each week over an annual period and is shown as a
percentage of the investment. The effective yield is calculated similarly, but
the net investment income earned by the investment is assumed to be compounded
when annualized. The effective yield will be slightly higher than the yield due
to this compounding effect.
The historical performance calculation for the Portfolio may be shown in the
form of "yield" and "effective yield." These various measures of performance are
described below. The Adviser has contractually agreed to absorb certain
operating expenses of the Portfolio to the extent specified in the prospectus.
Without this expense absorption, the performance results noted herein for the
Government Securities Portfolio would have been lower.
The Portfolio's seven-day yield is computed in accordance with a standardized
method prescribed by rules of the Securities and Exchange Commission. Under that
method, the yield quotation is based on a seven-day period and is computed for
the Portfolio as follows. The first calculation is net investment income per
share, which is accrued interest on portfolio securities, plus or minus
amortized discount or premium, less accrued expenses. This number is then
divided by the price per share (expected to remain constant at $1.00) at the
beginning of the period ("base period return"). The result is then divided by 7
and multiplied by 365 and the resulting yield figure is carried to the nearest
one-hundredth of one percent. Realized capital gains or losses and unrealized
appreciation or depreciation of investments are not included in the
calculations. For the period ended March 31, 1999, the Government Securities
Portfolio's Service Shares seven-day yield was 4.73%.
The Portfolio's seven-day effective yield is determined by taking the base
period return (computed as described above) and calculating the effect of
assumed compounding. The formula for the seven-day effective yield is:
(seven-day base period return +1)365/7 - 1. The Portfolio may also advertise a
thirty-day effective yield in which case the formula is (thirty-day base period
return +1)365/30 - 1. For the period ended March 31, 1999, the Government
Securities Portfolio's seven-day effective yield was 4.84%.
The Portfolio's yield fluctuates, and the publication of an annualized yield
quotation is not a representation as to what an investment in the Portfolio will
actually yield for any given future period. Actual yields will depend not only
on changes in interest rates on money market instruments during the period in
which the investment in the Portfolio is held, but also on such matters as
Portfolio expenses.
Investors have an extensive choice of money market funds and money market
deposit accounts and the information below may be useful to investors who wish
to compare the past performance of the Portfolio with that of its competitors.
Past performance cannot be a guarantee of future results.
The Portfolio may depict the historical performance of the securities in which
the Portfolio may invest over periods reflecting a variety of market or economic
conditions either alone or in comparison with alternative investments
performance indexes of those investments or economic indicators. The Portfolio
may also describe its portfolio holdings and depict its size or relative size
compared to other mutual funds, the number and make-up of its shareholder base
and other descriptive factors concerning the Portfolio.
The Portfolio's yield will fluctuate. Shares of the Portfolio are not insured.
The performance of the Portfolio may be compared to that of other mutual funds
tracked by Lipper, Inc. ("Lipper"). Lipper performance calculations include the
reinvestment of all capital gain and income dividends for the periods covered by
the calculations. The Portfolio's performance also may be compared to other
money market funds reported
14
<PAGE>
by IBC Financial Data, Inc. Money Fund Report(R) or
Money Market Insight(R) ("IBC Financial Data, Inc."), reporting services on
money market funds. As reported by IBC Financial Data, Inc., all investment
results represent total return (annualized results for the period net of
management fees and expenses) and one year investment results would be effective
annual yields assuming reinvestment of dividends. In addition, investors may
want to compare the Portfolio's performance to the Consumer Price Index, either
directly or by calculating its "real rate of return," which is adjusted for the
effects of inflation.
15
<PAGE>
Investors also may want to compare the Portfolio's performance to that of U.S.
Treasury bills or notes because such instruments represent alternative income
producing products. Treasury obligations are issued in selected denominations.
Rates of U.S. Treasury obligations are fixed at the time of issuance and payment
of principal and interest is backed by the full faith and credit of the U.S.
Treasury. The market value of such instruments generally will fluctuate
inversely with interest rates prior to maturity and will equal par value at
maturity. Generally, the values of obligations with shorter maturities will
fluctuate less than those with longer maturities. The Portfolio's yield will
fluctuate. Also, while the Portfolio seeks to maintain a net asset value per
share of $1.00, there is no assurance that it will be able to do so.
OFFICERS AND TRUSTEES
The officers and trustees of the Fund, their birth dates, their principal
occupations and their affiliations, if any, with the Adviser and Underwriter,
are listed below. All persons named as trustees also serve in similar capacities
for other funds advised by the Adviser.
JOHN W. BALLANTINE (2/16/46), Trustee, 1500 North Lake Shore Drive, Chicago,
Illinois; First Chicago NBD Corporation/The First National Bank of Chicago:
1996-1998 Executive Vice President and Chief Risk Management Officer; 1995-1996
Executive Vice President and Head of International Banking; 1992-1995 Executive
Vice President, Chief Credit and Market Risk Officer.
LEWIS A. BURNHAM (1/8/33), Trustee, 16410 Avila Boulevard, Tampa, Florida;
Retired; formerly, Partner, Business Resources Group; formerly, Executive Vice
President, Anchor Glass Container Corporation.
DONALD L. DUNAWAY (3/8/37), Trustee, 7011 Green Tree Drive, Naples, Florida;
Retired; formerly, Executive Vice President, A. O. Smith Corporation
(diversified manufacturer).
ROBERT B. HOFFMAN (12/11/36), Trustee, 1530 North State Parkway, Chicago,
Illinois; Chairman, Harnischfeger Industries, Inc. (machinery for the mining and
paper industries); formerly, Vice Chairman and Chief Financial Officer, Monsanto
Company (agricultural, pharmaceutical and nutritional/food products); formerly,
Vice President, Head of International Operations FMC Corporation (manufacturer
of machinery and chemicals).
DONALD R. JONES (1/17/30), Trustee, 182 Old Wick Lane, Inverness, Illinois;
Retired; Director, Motorola, Inc. (manufacturer of electronic equipment and
components); formerly, Executive Vice President and Chief Financial Officer,
Motorola, Inc.
SHIRLEY D. PETERSON (9/3/41), Trustee, 401 Rosemont Avenue, Frederick, Maryland;
President, Hood College; formerly, partner, Steptoe & Johnson (attorneys); prior
thereto, Commissioner, Internal Revenue Service; prior thereto, Assistant
Attorney General Tax, U.S. Department of Justice; Director; Bethlehem Steel
Corp.
CORNELIA M. SMALL (7/28/44), Trustee*, 345 Park Avenue, New York, NY; Managing
Director, Adviser.
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<PAGE>
WILLIAM P. SOMMERS (7/22/33), Trustee, 24717 Harbour View Drive, Ponte Vedra
Beach, Florida; Consultant and Director, SRI Consulting; formerly, President and
Chief Executive Officer, SRI International prior thereto, Executive Vice
President, Iameter (medical information and educational service provider); prior
thereto, Senior Vice President and Director, Booz, Allen & Hamilton Inc.
(management consulting firm) ; Director, PSI, Inc., Evergreen Solar, Inc. and
Litton Industries.
MARK S. CASADY (9/21/60), President*, 345 Park Avenue, New York, New York;
Managing Director, Adviser.
PHILIP J. COLLORA (11/15/45), Vice President and Secretary*, 222 South Riverside
Plaza, Chicago, Illinois; Senior Vice President, Adviser.
THOMAS W. LITTAUER (4/26/55), Vice President and Trustee*, Two International
Place, Boston, Massachusetts; Managing Director, Adviser; formerly, Head of
Broker Dealer Division of an unaffiliated investment management firm during
1997; prior thereto, President of Client Management Services of an unaffiliated
investment management firm from 1991 to 1996.
ANN M. McCREARY (11/6/56), Vice President*, 345 Park Avenue, New York, New York;
Managing Director, Adviser.
ROBERT C. PECK, JR. (10/1/46), Vice President*, 222 South Riverside Plaza,
Chicago, Illinois; Managing Director, Adviser; formerly, Executive Vice
President and Chief Investment Officer with an unaffiliated investment
management firm from 1988 to June 1997.
KATHRYN L. QUIRK (12/3/52), Vice President*, 345 Park Avenue, New York, New
York; Managing Director, Adviser.
FRANK J. RACHWALSKI, JR. (3/26/45), Vice President*, 222 South Riverside Plaza,
Chicago, Illinois; Managing Director, Adviser.
CORNELIA M. SMALL* (7/28/44), Vice President, 345 Park Avenue, New York, New
York; Managing Director, Scudder Kemper Investments, Inc.
LINDA J. WONDRACK (9/12/64), Vice President*, Two International Place, Boston,
Massachusetts; Senior Vice President, Adviser.
JOHN R. HEBBLE (6/27/58), Treasurer*, Two International Place, Boston,
Massachusetts; Senior Vice President, Adviser.
BRENDA LYONS (2/21/63), Assistant Treasurer*, Two International Place, Boston,
Massachusetts Senior Vice President, Adviser.
CAROLINE PEARSON (4/1/62), Assistant Secretary*, Two International Place,
Boston, Massachusetts; Senior Vice President, Adviser; formerly, Associate,
Dechert Price & Rhoads (law firm), from 1989 to 1997.
MAUREEN E. KANE (2/14/62), Assistant Secretary*, Two International Place,
Boston, Massachusetts; Vice President, Adviser; formerly, Assistant Vice
President of an unaffiliated investment management firm; prior thereto,
Associate Staff Attorney of an unaffiliated investment management firm;
Associate, Peabody & Arnold (law firm).
* Interested persons as defined in the 1940 Act.
The trustees and officers who are "interested persons" as designated above
receive no compensation from the Fund. The table below shows amounts paid or
accrued to those trustees who are not designated "interested persons" during the
Fund's fiscal year ended March 31, 1999, except that the information in the last
column is for calendar year 1998.
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<PAGE>
Total
Aggregate Compensation From
Compensation Kemper Fund Complex
Name Of Trustee From Fund Paid To Trustees(1)
--------------- --------- -------------------
John W. Ballantine(2) $ 0 $ 0
Lewis A. Burnham........................ 2,800 126,100
Donald L. Dunaway(3).................... 3,100 135,000
Robert B. Hoffman....................... 2,800 116,100
Donald R. Jones......................... 2,800 129,600
Shirley D. Peterson..................... 2,600 108,800
William P. Sommers...................... 2,600 108,800
- --------------------
(1) Includes compensation for service on the Boards of 25 Kemper funds with 43
fund portfolios. Each trustee currently serves as trustee of 26 Kemper
Funds with 48 fund portfolios.
(2) John W. Ballantine became a Trustee on May 18, 1999.
(3) Pursuant to deferred compensation agreements with the Kemper Funds,
deferred amounts accrue interest monthly at a rate approximate to the yield
of Zurich Money Funds - Zurich Money Market Fund. Total deferred fees and
interest accrued for all prior fiscal years are $13,700 for Mr. Dunaway
from Investors Cash Trust.
On June 30, 1999, the trustees and officers as a group owned less than 1% of the
outstanding shares of the Portfolio. No person owned of record 5% or more of the
outstanding shares of the Government Securities Portfolio except the entities
indicated in the chart below.
18
<PAGE>
Name And Address % Owned
TBD
- --------------------
* Record and beneficial owner.
SPECIAL FEATURES
Exchange Privilege. Subject to the limitations described below, Class A Shares
(or the equivalent) of the following Kemper Mutual Funds may be exchanged for
each other at their relative net asset values: Kemper Technology Fund, Kemper
Total Return Fund, Kemper Growth Fund, Kemper Small Capitalization Equity Fund,
Kemper Income and Capital Preservation Fund, Kemper Municipal Bond Fund, Kemper
Diversified Income Fund, Kemper High Yield Series, Kemper U.S. Government
Securities Fund, Kemper International Fund, Kemper State Tax-Free Income Series,
Kemper Adjustable Rate U.S. Government Fund, Kemper Blue Chip Fund, Kemper
Global Income Fund, Kemper Target Equity Fund (series are subject to a limited
offering period), Kemper Intermediate Municipal Bond Fund, Kemper Cash Reserves
Fund, Kemper U.S. Mortgage Fund, Kemper Value Series, Inc., Kemper Value Plus
Growth Fund, Kemper Horizon Fund, Kemper Europe Fund, Kemper Asian Growth Fund,
Kemper Aggressive Growth Fund, Kemper Global/International Series, Inc., Kemper
U.S. Growth and Income Fund, Kemper Small Cap Relative Value Fund, Kemper-Dreman
Financial Services Fund, Kemper Value Fund, Kemper Classic Growth Fund, Kemper
Global Discovery Fund, Kemper High Yield Fund II, Kemper Equity Trust, Kemper
Income Trust, Kemper Funds Trust and Kemper Securities Trust ("Kemper Mutual
Funds") and certain "Money Market Funds" (Zurich Money Funds, Zurich Yieldwise
Funds, Cash Equivalent Fund, Tax-Exempt California Money
19
<PAGE>
Market Fund, Cash Account Trust, Investors Municipal Cash Fund and Investors
Cash Trust). Shares of Money Market Funds and Kemper Cash Reserves Fund that
were acquired by purchase (not including shares acquired by dividend
reinvestment) are subject to the applicable sales charge on exchange. In
addition, shares of a Kemper Fund in excess of $1,000,000 (except Kemper Cash
Reserves Fund), acquired by exchange from another Fund may not be exchanged
thereafter until they have been owned for 15 days (the "15-Day Hold Policy"). In
addition to the current limits on exchanges of shares with a value over
$1,000,000, shares of a Kemper fund with a value of $1,000,000 or less (except
Kemper Cash Reserves Fund) acquired by exchange from another Kemper fund, or
from a money market fund, may not be exchanged thereafter until they have been
owned for 15 days, if, in the investment manager's judgement, the exchange
activity may have an adverse effect on the fund. In particular, a pattern of
exchanges that coincides with a "market timing" strategy may be disruptive to
the Kemper fund and therefore may be subject to the 15-day hold policy. For
purposes of determining whether the 15-Day Hold Policy applies to a particular
exchange, the value of the shares to be exchanged shall be computed by
aggregating the value of shares being exchanged for all accounts under common
control, discretion or advice, including without limitation accounts
administered by a financial services firm offering market timing, asset
allocation or similar services. Series of Kemper Target Equity Fund will be
available on exchange only during the Offering Period for such series as
described in the prospectus for such series. Cash Equivalent Fund, Tax-Exempt
California Money Market Fund, Cash Account Trust, Investors Municipal Cash Fund
and Investors Cash Trust are available on exchange but only through a financial
services firm having a services agreement with the Underwriter with respect to
such Funds. Exchanges may only be made for funds that are available for sale in
the shareholder's state of residence. Currently, Tax-Exempt California Money
Market Fund is available for sale only in California and the portfolios of
Investors Municipal Cash Fund are available for sale in certain states.
The total value of shares being exchanged must at least equal the minimum
investment requirement of the fund into which they are being exchanged.
Exchanges are made based on relative dollar values of the shares involved in the
exchange. There is no service fee for an exchange; however, financial services
firms may charge for their services in effecting exchange transactions.
Exchanges will be effected by redemption of shares of the fund held and purchase
of shares of the other fund. For federal income tax purposes, any such exchange
constitutes a sale upon which a gain or loss may be realized, depending upon
whether the value of the shares being exchanged is more or less than the
shareholder's adjusted cost basis. Shareholders interested in exercising the
exchange privilege may obtain an exchange form and prospectuses of the other
funds from firms or the Underwriter. Exchanges also may be authorized by
telephone if the shareholder has given authorization. Once the authorization is
on file, the Shareholder Service Agent will honor requests by telephone at
1-800-231-8568 or in writing subject to the limitations on liability described
in the prospectus. Any share certificates must be deposited prior to any
exchange of such shares. During periods when it is difficult to contact the
Shareholder Service Agent by telephone, it may be difficult to implement the
telephone exchange privilege. The exchange privilege is not a right and may be
suspended, terminated or modified at any time. Except as otherwise permitted by
applicable regulations, 60 days' prior written notice of any termination or
material change will be provided.
SHAREHOLDER RIGHTS
The Fund is an open-end, diversified management investment company, organized as
a business trust under the laws of Massachusetts on March 2, 1990. The Fund may
issue an unlimited number of shares of beneficial interest in one or more series
or "Portfolios," all having no par value, which may be divided by the Board of
Trustees into classes of shares, subject to compliance with the Securities and
Exchange Commission regulations permitting the creation of separate classes of
shares. The Portfolio's shares are currently divided into three classes: Service
Shares; Managed Shares and Institutional Shares. While only shares of the
"Government Securities Portfolio" and "Treasury Portfolio" are presently being
offered, the Board of Trustees may authorize the issuance of additional
Portfolios if deemed desirable, each with its own investment objective, policies
and restrictions. Since the Fund offers multiple Portfolios, it is known as a
"series company." Shares of the Portfolio have equal noncumulative voting
20
<PAGE>
rights and equal rights with respect to dividends, assets and liquidation of
such Portfolio subject to any preferences, rights or privileges of any classes
of shares within the Portfolio. Generally each class of shares issued by a
particular Portfolio would differ as to the allocation of certain expenses of
the Portfolio such as distribution and administrative expenses, permitting,
among other things, different levels of services or methods of distribution
among various classes. Shares are fully paid and nonassessable when issued, are
transferable without restriction and have no preemptive or conversion rights.
The Fund is not required to hold annual shareholders' meetings and does not
intend to do so. However, it will hold special meetings as required or deemed
desirable for such purposes as electing trustees, changing fundamental policies
or approving an investment management agreement. Subject to the Agreement and
Declaration of Trust of the Fund, shareholders may remove trustees. Shareholders
will vote by Portfolio and not in the aggregate or by class except when voting
in the aggregate is required under the 1940 Act, such as for the election of
trustees, or when the Board of Trustees determines that voting by class is
appropriate.
The Fund generally is not required to hold meetings of its shareholders. Under
the Agreement and Declaration of Trust of the Fund ("Declaration of Trust"),
however, shareholder meetings will be held in connection with the following
matters: (a) the election or removal of trustees if a meeting is called for such
purpose; (b) the adoption of any contract for which shareholder approval is
required by the 1940 Act; (c) any termination of the Fund to the extent and as
provided in the Declaration of Trust; (d) any amendment of the Declaration of
Trust (other than amendments changing the name of the Fund or any Portfolio,
establishing the Portfolio, supplying any omission, curing any ambiguity or
curing, correcting or supplementing any defective or inconsistent provision
thereof); and (e) such additional matters as may be required by law, the
Declaration of Trust, the By-laws of the Fund, or any registration of the Fund
with the Securities and Exchange Commission or any state, or as the trustees may
consider necessary or desirable. The shareholders also would vote upon changes
in fundamental investment objectives, policies or restrictions.
Each trustee serves until the next meeting of shareholders, if any, called for
the purpose of electing trustees and until the election and qualification of a
successor or until such trustee sooner dies, resigns, retires or is removed by a
majority vote of the shares entitled to vote (as described below) or a majority
of the trustees. In accordance with the 1940 Act (a) the Fund will hold a
shareholder meeting for the election of trustees at such time as less than a
majority of the trustees have been elected by shareholders, and (b) if, as a
result of a vacancy on the Board of Trustees, less than two-thirds of the
trustees have been elected by the shareholders, that vacancy will be filled only
by a vote of the shareholders.
Trustees may be removed from office by a vote of the holders of a majority of
the outstanding shares at a meeting called for that purpose, which meeting shall
be held upon the written request of the holders of not less than 10% of the
outstanding shares. Upon the written request of ten or more shareholders, who
have been such for at least six months and who hold shares constituting at least
1% of the outstanding shares of the Fund, stating that such shareholders wish to
communicate with the other shareholders for the purpose of obtaining the
signatures necessary to demand a meeting to consider removal of a trustee, the
Fund has undertaken to disseminate appropriate materials at the expense of the
requesting shareholders.
The Declaration of Trust provides that the presence at a shareholder meeting in
person or by proxy of at least 30% of the shares entitled to vote on a matter
shall constitute a quorum. Thus, a meeting of shareholders of the Fund could
take place even if less than a majority of the shareholders were represented on
its scheduled date. Shareholders would in such a case be permitted to take
action which does not require a larger vote than a majority of a quorum, such as
the election of trustees and ratification of the selection of auditors. Some
matters requiring a larger vote under the Declaration of Trust, such as
termination or reorganization of the Fund and certain amendments of the
Declaration of Trust, would not be affected by this provision; nor would matters
which under the 1940 Act require the vote of a "majority of the outstanding
voting securities" as defined in the 1940 Act.
The Declaration of Trust specifically authorizes the Board of Trustees to
terminate the Fund (or any Portfolio or class) by notice to the shareholders
without shareholder approval.
Under Massachusetts law, shareholders of a Massachusetts business trust could,
under certain circumstances, be held personally liable for obligations of the
Fund. The Declaration of Trust, however, disclaims shareholder liability for
acts or obligations of the Fund and requires that notice of such disclaimer be
given in each agreement, obligation, or instrument entered into or executed by
the Fund or the trustees. Moreover, the Declaration of Trust provides for
21
<PAGE>
indemnification out of Fund property for all losses and expenses of any
shareholder held personally liable for the obligations of the Fund and the Fund
will be covered by insurance which the trustees consider adequate to cover
foreseeable tort claims. Thus, the risk of a shareholder incurring financial
loss on account of shareholder liability is considered by the Adviser remote and
not material, since it is limited to circumstances in which a disclaimer is
inoperative and the Fund itself is unable to meet its obligations.
22
<PAGE>
INVESTORS CASH TRUST
PART C. OTHER INFORMATION
<TABLE>
<CAPTION>
Item 23. Exhibits.
- -------- ---------
<S> <C> <C> <C>
(a) (1) Amended and Restated Agreement and Declaration of Trust, dated March 9,
1990, is incorporated by reference to Post-Effective Amendment No. 7 to the
Registration Statement.
(2) Written Instrument Amending Agreement and Declaration of Trust, dated August
14, 1990 is incorporated by reference to Post-Effective Amendment No. 7 to
the Registration Statement.
(3) Written Instrument Amending Agreement and Declaration of Trust, dated
September 19, 1990 is incorporated by reference to Post-Effective Amendment
No. 7 to the Registration Statement.
(b) By-laws of the Trust are incorporated by reference to Post-Effective
Amendment No. 7 to the Registration Statement.
(c) (1) Text of Share Certificate is incorporated by reference to Post-Effective
Amendment No. 7 to the Registration Statement.
(2) Establishment and Declaration of Series of Beneficial Interest with respect
to the Scudder Government Securities Institutional Shares of the Government
Securities Portfolio to be filed by subsequent amendment.
(3) Establishment and Declaration of Series of Beneficial Interest with respect
to the Scudder Government Securities Managed Shares of the Government
Securities Portfolio to be filed by subsequent amendment.
(d) Investment Management Agreement, dated September 7, 1998, is incorporated by
reference to Post-Effective Amendment No. 11 to the Registration Statement.
(e) (2) Underwriting and Distribution Services Agreement between the Registrant and
Kemper Distributors, Inc., dated September 7, 1998, is incorporated by
reference to Post-Effective Amendment No. 11 to the Registration Statement.
(3) Form of Selling Group Agreement is incorporated by reference to
Post-Effective Amendment No. 7 to the Registration Statement.
(f) Inapplicable.
(g) (1) Custody Agreement between the Registrant, on behalf of Government Securities
Portfolio and Treasury Portfolio, and State Street Bank and Trust Company,
dated April 19, 1999, incorporated by reference to Post-Effective Amendment
No. 11 to the Registrant's Registration Statement on Form N-1A; filed with
the SEC on May 18, 1999.
(h) (1) Agency Agreement, dated September 21, 1990, is incorporated by reference to
Post-Effective Amendment No. 7 to the Registration Statement.
1
<PAGE>
(2) Supplement to Agency Agreement, dated April 1, 1991,is incorporated by
reference to Post-Effective Amendment No. 7 to the Registration Statement.
(3) Supplement to Agency Agreement, dated October 1, 1992, is incorporated by
reference to Post-Effective Amendment No. 7 to the Registration Statement.
(4) Supplement to Agency Agreement, dated April 1, 1995 is incorporated by
reference to Post-Effective Amendment No. 8 to the Registration Statement.
(5) Administration and Shareholder Services Agreement, dated October 1, 1991, is
incorporated by reference to Post-Effective Amendment No. 7 to the
Registration Statement on Form N-1A.
(6) Amendment to Administration and Shareholder Services Agreement, dated
December 1, 1993, is incorporated by reference to Post-Effective Amendment
No. 7 to the Registration Statement.
(7) Assignment and Assumption Agreement, dated February 1, 1995, is incorporated
by reference to Post-Effective Amendment No. 7 to the Registration Statement.
(8) Fund Accounting Services Agreements, each dated December 31, 1997, on behalf
of Government Securities Portfolio and Treasury Portfolio, respectively, is
incorporated by reference to Post-Effective Amendment No. 10 to the
Registration Statement.
(9) Amendment to the Fund Accounting and Services Agreements between the
Registrant, on behalf of Scudder Government Securities Institutional Shares
and Scudder Government Securities Managed Shares, to be filed by subsequent
amendment.
(i) Opinion and Consent of Counsel; to be filed by subsequent amendment.
(j) Report and Consent of Independent Auditors; to be filed by subsequent
amendment.
(k) Inapplicable
(l) Inapplicable
(m) Inapplicable
(n) Inapplicable
(o) Inapplicable
</TABLE>
Item 24. Persons Controlled by or under Common Control with Fund.
- -------- --------------------------------------------------------
None
Item 25. Indemnification.
- -------- ----------------
Article VIII of the Registrant's Agreement and Declaration of Trust
(Exhibit 1 hereto, which is incorporated herein by reference) provides in effect
that the Registrant will indemnify its officers and trustees under certain
2
<PAGE>
circumstances. However, in accordance with Section 17(h) and 17(i) of the
Investment Company Act of 1940 and its own terms, said Article of the Agreement
and Declaration of Trust does not protect any person against any liability to
the Registrant or its shareholders to which he would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of his office.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers, and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a trustee, officer, or controlling
person of the Registrant in the successful defense of any action, suit, or
proceeding) is asserted by such trustee, officer, or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question as to whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
Item 26. Business and Other Connections of Investment Adviser.
- -------- -----------------------------------------------------
Scudder Kemper Investments, Inc. has stockholders and
employees who are denominated officers but do not as such have
corporation-wide responsibilities. Such persons are not
considered officers for the purpose of this Item 26.
<TABLE>
<CAPTION>
Business and Other Connections of Board
Name of Directors of Registrant's Adviser
---- ------------------------------------
<S> <C>
Stephen R. Beckwith Treasurer and Chief Financial Officer, Scudder Kemper Investments, Inc.**
Vice President and Treasurer, Scudder Fund Accounting Corporation*
Director, Scudder Stevens & Clark Corporation**
Director and Chairman, Scudder Defined Contribution Services, Inc.**
Director and President, Scudder Capital Asset Corporation**
Director and President, Scudder Capital Stock Corporation**
Director and President, Scudder Capital Planning Corporation**
Director and President, SS&C Investment Corporation**
Director and President, SIS Investment Corporation**
Director and President, SRV Investment Corporation**
Lynn S. Birdsong Director and Vice President, Scudder Kemper Investments, Inc.**
Director, Scudder, Stevens & Clark (Luxembourg) S.A.#
William H. Bolinder Director, Scudder Kemper Investments, Inc.**
Member, Group Executive Board, Zurich Financial Services, Inc.##
Chairman, Zurich-American Insurance Company o
Laurence W. Cheng Director, Scudder Kemper Investments, Inc.**
Member, Corporate Executive Board, Zurich Insurance Company of Switzerland##
Director, ZKI Holding Corporation xx
Gunther Gose Director, Scudder Kemper Investments, Inc.**
CFO and Member, Group Executive Board, Zurich Financial Services, Inc.##
CEO/Branch Offices, Zurich Life Insurance Company##
Rolf Huppi Director, Chairman of the Board, Scudder Kemper Investments, Inc.**
Member, Corporate Executive Board, Zurich Insurance Company of Switzerland##
Director, Chairman of the Board, Zurich Holding Company of America o
Director, ZKI Holding Corporation xx
3
<PAGE>
Kathryn L. Quirk Chief Legal Officer, Chief Compliance Officer and Secretary, Scudder Kemper
Investments, Inc.**
Director, Senior Vice President & Assistant Clerk, Scudder Investor Services, Inc.*
Director, Vice President & Secretary, Scudder Fund Accounting Corporation*
Director, Vice President & Secretary, Scudder Realty Holdings Corporation*
Director & Assistant Clerk, Scudder Service Corporation*
Director, SFA, Inc.*
Vice President, Director & Assistant Secretary, Scudder Precious Metals, Inc.***
Director, Scudder, Stevens & Clark Japan, Inc.***
Director, Vice President and Secretary, Scudder, Stevens & Clark of Canada, Ltd.***
Director, Vice President and Secretary, Scudder Canada Investor Services Limited***
Director, Vice President and Secretary, Scudder Realty Advisers, Inc. x
Director and Secretary, Scudder, Stevens & Clark Corporation**
Director and Secretary, Scudder, Stevens & Clark Overseas Corporation oo
Director and Secretary, SFA, Inc.*
Director, Vice President and Secretary, Scudder Defined Contribution Services, Inc.**
Director, Vice President and Secretary, Scudder Capital Asset Corporation**
Director, Vice President and Secretary, Scudder Capital Stock Corporation**
Director, Vice President and Secretary, Scudder Capital Planning Corporation**
Director, Vice President and Secretary, SS&C Investment Corporation**
Director, Vice President and Secretary, SIS Investment Corporation**
Director, Vice President and Secretary, SRV Investment Corporation**
Director, Vice President and Secretary, Scudder Financial Services, Inc.*
Director, Korea Bond Fund Management Co., Ltd.+
Cornelia M. Small Director and Vice President, Scudder Kemper Investments, Inc.**
Edmond D. Villani Director, President and Chief Executive Officer, Scudder Kemper Investments, Inc.**
Director, Scudder, Stevens & Clark Japan, Inc.###
President and Director, Scudder, Stevens & Clark Overseas Corporation oo
President and Director, Scudder, Stevens & Clark Corporation**
Director, Scudder Realty Advisors, Inc.x
Director, IBJ Global Investment Management S.A. Luxembourg, Grand-Duchy of Luxembourg
* Two International Place, Boston, MA
x 333 South Hope Street, Los Angeles, CA
** 345 Park Avenue, New York, NY
# Societe Anonyme, 47, Boulevard Royal, L-2449 Luxembourg, R.C. Luxembourg B 34.564
*** Toronto, Ontario, Canada
oo 20-5, Ichibancho, Chiyoda-ku, Tokyo, Japan
### 1-7, Kojimachi, Chiyoda-ku, Tokyo, Japan
xx 222 S. Riverside, Chicago, IL
o Zurich Towers, 1400 American Ln., Schaumburg, IL
+ P.O. Box 309, Upland House, S. Church St., Grand Cayman, British West Indies
## Mythenquai-2, P.O. Box CH-8022, Zurich, Switzerland
</TABLE>
Item 27. Principal Underwriters.
- -------- -----------------------
(a)
Kemper Distributors, Inc. acts as principal underwriter of the
Registrant's shares and acts as principal underwriter of the Kemper
Funds.
4
<PAGE>
(b)
Information on the officers and directors of Kemper Distributors, Inc.,
principal underwriter for the Registrant is set forth below. The
principal business address is 222 South Riverside Plaza, Chicago,
Illinois 60606.
<TABLE>
<CAPTION>
(1) (2) (3)
Positions and Offices with Positions and
Name Kemper Distributors, Inc. Offices with Registrant
---- ------------------------- -----------------------
<S> <C> <C> <C>
James L. Greenawalt President None
Thomas W. Littauer Director, Chief Executive Officer Trustee and Vice President
Kathryn L. Quirk Director, Secretary, Chief Legal Vice President
Officer and Vice President
James J. McGovern Chief Financial Officer and Vice None
President
Linda J. Wondrack Vice President and Chief Compliance Vice President
Officer
Paula Gaccione Vice President None
Michael E. Harrington Vice President None
Robert A. Rudell Vice President None
William M. Thomas Vice President None
Todd N. Gierke Assistant Treasurer None
Philip J. Collora Assistant Secretary Vice President and Secretary
Paul J. Elmlinger Assistant Secretary None
Diane E. Ratekin Assistant Secretary None
Mark S. Casady Director, Chairman President
Stephen R. Beckwith Director None
(c) Not applicable
</TABLE>
Item 28. Location of Accounts and Records.
- -------- ---------------------------------
Accounts, books and other documents are maintained at the offices of
the Registrant, the offices of Registrant's investment adviser, Scudder Kemper
Investments, Inc., 222 South Riverside Plaza, Chicago, Illinois 60606, at the
offices of the Registrant's principal underwriter, Kemper Distributors, Inc.,
222 South Riverside Plaza, Chicago, Illinois 60606 or, in the case of records
concerning custodial functions, at the offices of the custodian, State Street
Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts 02110 or, in
the case of records concerning transfer agency functions, at the offices of
State Street Bank and Trust Company and of the shareholder service agent, Kemper
Service Company, 811 Main Street, Kansas City, Missouri 64105.
5
<PAGE>
Item 29. Management Services.
- -------- --------------------
Inapplicable.
Item 30. Undertakings.
- -------- -------------
Inapplicable.
6
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this amendment to
its Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Chicago and State of Illinois, on the
3rd day of September, 1999.
INVESTORS CASH TRUST
By /s/ Mark S. Casady
------------------
Mark S. Casady
President
Pursuant to the requirements of the Securities Act of 1933, this
amendment to its Registration Statement has been signed below on September 3,
1999, on behalf of the following persons in the capacities indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ Mark S. Casady September 3, 1999
- --------------------------------------
Mark S. Casady President
/s/ Thomas W. Littauer September 3, 1999
- --------------------------------------
Thomas W. Littauer Chairman and Trustee
/s/ John W. Ballantine September 3, 1999
- --------------------------------------
John W. Ballantine Trustee
/s/ Lewis A. Burnham September 3, 1999
- --------------------------------------
Lewis A. Burnham* Trustee
/s/ Donald L. Dunaway September 3, 1999
- --------------------------------------
Donald L. Dunaway* Trustee
/s/ Robert B. Hoffman September 3, 1999
- --------------------------------------
Robert B. Hoffman* Trustee
/s/ Donald R. Jones September 3, 1999
- --------------------------------------
Donald R. Jones* Trustee
/s/ Shirley D. Peterson September 3, 1999
- --------------------------------------
Shirley D. Peterson* Trustee
<PAGE>
/s/ Cornelia M. Small
- --------------------------------------
Cornelia M. Small Trustee September 3, 1999
/s/ William P. Sommers September 3, 1999
- --------------------------------------
William P. Sommers* Trustee
/s/ John R. Hebble September 3, 1999
- --------------------------------------
John R. Hebble Treasurer (Principal Financial and
Accounting Officer)
</TABLE>
*By: /s/ Philip J. Collora
----------------------------------
Philip J. Collora**
** Philip J. Collora signs this document
pursuant to powers of attorney contained in
Post-Effective Amendment No. 10 to the
Registration Statement, filed on July 28,
1998 and pursuant to a power of attorney
filed herewith.
2
<PAGE>
POWER OF ATTORNEY
-----------------
The person whose signature appears below hereby appoints Kathryn L.
Quirk, Caroline Pearson, and Philip J. Collora and each of them, any of whom may
act without the joinder of the others, as such person's attorney-in-fact to sign
and file on such person's behalf individually and in the capacity stated below
such registration statements, amendments, post-effective amendments, exhibits,
applications and other documents with the Securities and Exchange Commission or
any other regulatory authority as may be desirable or necessary in connection
with the public offering of shares of Investors Cash Trust.
Signature Title Date
- --------- ----- ----
/s/ John W. Ballantine Trustee September 3, 1999
- ----------------------
<PAGE>
File No. 33-34645
File No. 811-6103
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
EXHIBITS
TO
FORM N-1A
POST-EFFECTIVE AMENDMENT NO. 13
TO REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AND
AMENDMENT NO. 15
TO REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
INVESTORS CASH TRUST
<PAGE>
INVESTORS CASH TRUST
EXHIBIT INDEX
