SEMIANNUAL REPORT
--------------------------------------------------------------------------------
Premier Money
Market Shares
September 30, 2000
o Treasury Portfolio
Principal Underwriter
Kemper Distributors, Inc.
222 S. Riverside Plaza
Chicago, IL 60606
This report is not to be distributed unless preceded or accompanied by an
Investors Cash Trust prospectus.
<PAGE>
Dear Shareholder:
We appreciate your decision to invest in the Premier Money Market Shares. To
provide you with an update of holdings and financial highlights, on the
following pages you'll find the Fund's semiannual report for the six months
ended September 30, 2000.
Briefly, for the past six months the Fund's Treasury Portfolio registered solid
performance and achieved its objective of providing maximum current income from
high quality money market securities while maintaining the stability of
principal. Additionally, the portfolio's security maintained its "AAA" rating
from Standard and Poor's Corporation.
Economic Review and Outlook
During the past three months expectations of both a growth slowdown and an end
to the path of tightening monetary conditions became more entrenched. Economic
data, with few exceptions, supported these perceptions of a soft landing, and
the forward yield curve suggested a possible ease in the first quarter of 2001.
Nevertheless, the wild card of inflation remained difficult to dismiss. Core CPI
as measured on a year over year basis is in an uptrend, and energy and some
agricultural prices have risen. In this context, short-term instruments traded
rich to 6.5% Federal Funds target. Moreover, the yield curve continued to
flatten and actually inverted with the extension from one- to twelve-month U.S.
Treasury Bills declining from 20 to negative 12 basis points.
We favored lengthening given attractive market opportunities, but the shape of
the yield curve was the limiting factor as U.S. Treasury Bills generally traded
rich to Federal Funds on a historical spread basis. We retained our primary
emphasis in repurchase agreements. The reason is their yield is principally
determined by the trading level of Federal Funds.
It appears the unfolding economic scenario will be marked by both softer growth
and developing inflationary pressures. We believe any slowdown should be modest.
Consumers are highly confident, as gauged by firm housing data and strengthening
personal consumption expenditures, and remain encouraged by tight labor markets.
On the other hand, the Fed is very sensitive to inflation, particularly any
incipient wage pressure, because any growth slowdown may damage labor
productivity, a critical driver of this successful economic run. Under these
conditions, we believe the Fed is on hold for the balance of the year.
(Unaudited)
Fund Results
As of September 30, 2000
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7-Day
Current Yield
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Treasury Portfolio 5.92%
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Thank you again for your investment in the Premier Money Market Shares. We look
forward to serving your investment needs for years to come.
/s/Frank Rachwalski
Frank Rachwalski
Vice President and Lead Portfolio Manager
October 1, 2000
Frank Rachwalski is a Managing Director of Scudder Kemper Investments, Inc. and
is Vice President and Lead Portfolio Manager of all Scudder Kemper Money Funds.
Mr. Rachwalski holds B.B.A. and M.B.A. degrees from Loyola University.
Notes
The fund's net yield is the annualized sum of the daily dividend rates for the
period. Yields are historical, may fluctuate, and do not guarantee future
performance.
Like all money market funds, an investment in the Fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve your investment at $1.00 per share,
it is possible to lose money.
The views expressed in this report reflect those of the portfolio manager only
through the end of the period stated above. The manager's views are subject to
change at any time, based on market and other conditions.
1
<PAGE>
Portfolio of Investments at September 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
----------------------------------------------------------------------------------------------------
Treasury Portfolio
Repurchase Agreements** -- 57.6%
----------------------------------------------------------------------------------------------------
<S> <C> <C>
Bear, Stearns, Inc., 6.40%, 10/6/2000
to be repurchased at $2,002,133 $ 2,000,000 $ 2,000,000
----------------------------------------------------------------------------------------------------
Chase Manhattan Bank, 6.40%, 10/20/2000
to be repurchased at $5,017,778 5,000,000 5,000,000
----------------------------------------------------------------------------------------------------
Goldman Sachs, Inc. 6.43%, 12/11/2000
to be repurchased at $5,064,300 5,000,000 5,000,000
----------------------------------------------------------------------------------------------------
Greenwich Capital, 6.45%, 10/5/2000
to be repurchased at $5,004,479 5,000,000 5,000,000
----------------------------------------------------------------------------------------------------
Morgan Stanley, Dean Witter & Co., 6.43%, 10/10/2000
to be repurchased at $5,008,931 5,000,000 5,000,000
----------------------------------------------------------------------------------------------------
Salomon Brothers, Inc., 6.38%, 10/10/2000
to be repurchased at $5,509,747 5,500,000 5,500,000
----------------------------------------------------------------------------------------------------
State Street Bank and Trust Company, 6.48%, 10/2/2000
to be repurchased at $1,044,376 1,044,000 1,044,000
----------------------------------------------------------------------------------------------------
Total Repurchase Agreements (Cost $28,544,000) 28,544,000
----------------------------------------------------------------------------------------------------
Short-Term Notes -- 42.4%
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Overseas Private Investment Corp., 6.55%, 10/2/2000-10/5/2000* 13,000,000 13,000,000
----------------------------------------------------------------------------------------------------
U.S. Treasury Bills, 5.83%, 10/12/2000 8,000,000 7,984,813
----------------------------------------------------------------------------------------------------
Total Short-Term Notes (Cost $20,984,813) 20,984,813
----------------------------------------------------------------------------------------------------
Total Investment Portfolio-- 100.0% (Cost $49,528,813) (a) $ 49,528,813
----------------------------------------------------------------------------------------------------
</TABLE>
Interest rates represent annualized yield to date of maturity, except for
floating rate securities described below.
* Floating rate notes are securities whose yields vary with a designated
market index or market rate, such as the coupon equivalent of the U.S.
Treasury bill rate. These securities are shown at their current rate as
of September 30, 2000. The dates shown represent the demand date or
next interest rate change date.
** Repurchase agreements are fully collateralized by U.S. Treasury or
Government agency securities.
(a) Cost for federal income tax purposes was $49,528,813.
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
Financial Statements
Statement of Assets and Liabilities -- Treasury Portfolio
<TABLE>
<CAPTION>
As of September 30, 2000 (Unaudited)
--------------------------------------------------------------------------------------------------------------
Assets
--------------------------------------------------------------------------------------------------------------
<S> <C>
Investments in securities, at value:
Short-term notes $ 20,984,813
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Repurchase agreements 28,544,000
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Cash 759
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Receivable for investments sold 5,681,452
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Interest receivable 476,034
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Due from Adviser 53,142
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Total assets 55,740,200
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Liabilities
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Dividends payable 292,459
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Other accrued expenses and payables 21,753
---------------
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Total liabilities 314,212
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Net assets, at value $ 55,425,988
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Net Asset Value
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Service Shares
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Net assets applicable to shares outstanding $ 40,606,668
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Shares outstanding of capital stock, $.01 par value, unlimited number of shares authorized 40,606,668
--------------------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share (net assets/shares outstanding) $ 1.00
--------------------------------------------------------------------------------------------------------------
Premier Money Market Shares
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Net assets applicable to shares outstanding $ 14,819,320
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Shares outstanding of capital stock, $.01 par value, unlimited number of shares authorized 14,819,320
--------------------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share (net assets/shares outstanding) $ 1.00
--------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
Statements of Operations
<TABLE>
<CAPTION>
Treasury
Six Months Ended September 30, 2000 (Unaudited) Portfolio
---------------------------------------------------------------------------------------------------------------------
<S> <C>
Investment Income
-----------------------------------------------------------------------------------------------------------------------
Income:
---------------------------------------------------------------------------------------------------------------------
Interest $ 1,750,456
---------------
---------------------------------------------------------------------------------------------------------------------
Total Income 1,750,456
---------------
---------------------------------------------------------------------------------------------------------------------
Expenses:
---------------------------------------------------------------------------------------------------------------------
Management fee 41,532
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Services to shareholders 11,632
---------------------------------------------------------------------------------------------------------------------
Custodian fees 2,992
---------------------------------------------------------------------------------------------------------------------
Distribution services fees 12,123
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Administrative services fees 34,914
---------------------------------------------------------------------------------------------------------------------
Auditing 5,972
---------------------------------------------------------------------------------------------------------------------
Legal 2,153
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Trustees' fees and expenses 883
---------------------------------------------------------------------------------------------------------------------
Reports to shareholders 31,206
---------------------------------------------------------------------------------------------------------------------
Registration fees 29,615
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Other 2,033
---------------
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Total expenses, before expense reductions 175,055
---------------------------------------------------------------------------------------------------------------------
Expense reductions (71,278)
---------------
---------------------------------------------------------------------------------------------------------------------
Total expenses, after expense reductions 103,777
---------------------------------------------------------------------------------------------------------------------
Net investment income 1,646,679
---------------------------------------------------------------------------------------------------------------------
Realized and unrealized gain (loss) on investment transactions
---------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) from investments 1,345
---------------------------------------------------------------------------------------------------------------------
Net gain (loss) on investment transactions 1,345
---------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $ 1,648,024
---------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Statements of Changes in Net Assets -- Treasury Portfolio
<TABLE>
<CAPTION>
Six Months
Ended
September 30, Year Ended
2000 March 31,
(Unaudited) 2000
---------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
---------------------------------------------------------------------------------------------------------------------
Net investment income $ 1,646,679 $ 2,276,513
---------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) on investment transactions 1,345 --
------------------------------
---------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 1,648,024 2,276,513
------------------------------
---------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from:
Net investment income (Service Shares) (1,380,236) (2,276,513)
---------------------------------------------------------------------------------------------------------------------
Net investment income (Premier Money Market Shares) (267,788) --
---------------------------------------------------------------------------------------------------------------------
Fund share transactions at net asset value of $1.00 per share:
Service Shares:
---------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 8,106,967 39,943,424
---------------------------------------------------------------------------------------------------------------------
Reinvestment of distributions 1,097,948 2,485,550
---------------------------------------------------------------------------------------------------------------------
Cost of shares redeemed (16,487,094) (52,942,415)
------------------------------
---------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions (7,282,179) (10,513,441)
---------------------------------------------------------------------------------------------------------------------
Premier Money Market Shares (a):
---------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 30,049,266 --
---------------------------------------------------------------------------------------------------------------------
Reinvestment of distributions 190,193 --
---------------------------------------------------------------------------------------------------------------------
Cost of shares redeemed (15,420,139) --
------------------------------
---------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions 14,819,320 --
------------------------------
---------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets 7,537,141 (10,513,441)
---------------------------------------------------------------------------------------------------------------------
Net assets at beginning of period 47,888,847 58,402,288
---------------------------------------------------------------------------------------------------------------------
Net assets at end of period $ 55,425,988 $ 47,888,847
---------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) For the period April 28, 2000 (commencement of operations) to September
30, 2000.
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
Financial Highlights
The following table includes selected data for a share outstanding throughout a
period and other performance information derived from the financial statements
and market price data.
Treasury Portfolio -- Premier Money Market Shares
2000(a)
-------------------------------------------------------------------------------
Net asset value, beginning of period $ 1.00
-------------------------------------------------------------------------------
Net investment income .03
-------------------------------------------------------------------------------
Less distributions from net investment income (.03)
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Net asset value, end of period $ 1.00
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Total Return (%) 2.32**
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Ratios to Average Net Assets and Supplemental Data
-------------------------------------------------------------------------------
Net assets, end of period ($ thousands) 14,819
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Ratio of expenses before expense reductions (%) 1.19*
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Ratio of expenses after expense reductions (%) .97*
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Ratio of net investment income (%) 5.57*
-------------------------------------------------------------------------------
* Annualized
** Not annualized
(a) For the period April 28, 2000 (commencement of operations) to September
30, 2000.
6
<PAGE>
Notes to Financial Statements
1. Significant Accounting Policies
Investors Cash Trust (the "Fund") is registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), as an open-end, diversified management
investment company organized as a Massachusetts business trust. The Fund
currently offers two series of shares (portfolios) -- the Government Securities
Portfolio and the Treasury Portfolio. The Government Securities Portfolio offers
multiple classes of shares that include Service Shares, Institutional Shares and
Managed Shares. Effective April 28, 2000, the Treasury Portfolio began offering
the Premier Money Market Shares. Certain detailed financial information for the
Service Shares, Institutional Shares and Managed Shares of the Government
Securities Portfolio and Service Shares of the Treasury Portfolio is provided
separately and is available upon request.
Investment income, realized and unrealized gains and losses, and certain
fund-level expenses and expense reductions, if any, are borne pro rata on the
basis of relative net assets by the holders of all classes of shares except that
each class bears certain expenses unique to that class such as distribution
services, shareholder services, administrative services and certain other class
specific expenses. Differences in class expenses may result in payment of
different per share dividends by class. All shares of the Fund have equal rights
with respect to voting subject to class specific arrangements.
The Fund's financial statements are prepared in accordance with accounting
principles generally accepted in the United States which require the use of
management estimates. The policies described below are followed consistently by
the Fund in the preparation of its financial statements.
Security Valuation. The Fund values all portfolio securities utilizing the
amortized cost method permitted in accordance with Rule 2a-7 under the 1940 Act
and pursuant to which the Fund must adhere to certain conditions. Under this
method, which does not take into account unrealized gains or losses on
securities, an instrument is initially valued at its cost and thereafter assumes
a constant accretion/amortization to maturity of any discount/premium.
Repurchase Agreements. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian or
sub-custodian bank, receives delivery of the underlying securities, the amount
of which at the time of purchase and each subsequent business day is required to
be maintained at such a level that the market value is equal to at least the
principal amount of the repurchase price plus accrued interest.
Federal Income Taxes. The Fund's policy is to comply with the requirements of
the Internal Revenue Code, as amended, which are applicable to regulated
investment companies, and to distribute all of its taxable income to its
shareholders. Accordingly, the Fund paid no federal income taxes and no federal
income tax provision was required.
Distribution of Income and Gains. All of the net investment income of the Fund
is declared as a daily dividend and is distributed to shareholders monthly. Net
investment income includes all realized gains (losses) on portfolio securities.
Investment Transactions and Investment Income. Investment transactions are
accounted for on the trade date. Interest income is recorded on the accrual
basis. Realized gains and losses from investment transactions are recorded on an
identified cost basis. All discounts and premiums are accreted/amortized for
both tax and financial reporting purposes.
Expenses. Expenses arising in connection with a specific portfolio are allocated
to that portfolio. Other Fund expenses are allocated between the portfolios in
proportion to their relative net assets.
7
<PAGE>
2. Transactions with Affiliates
Management Agreement. The Fund has a management agreement with Scudder Kemper
Investments, Inc. ("Scudder Kemper") and pays a monthly investment management
fee of 1/12 of the annual rate of 0.15% of average daily net assets. For the six
months ended September 30, 2000, the Fund incurred the following management
fees:
Management
Management fee waived
fee by Scudder Effective
Portfolio imposed ($) Kemper ($) rate (%)
----------------------------------------------------------------------
Treasury Portfolio 36,198 5,334 0.13
----------------------------------------------------------------------
Administrative Services Agreement. The Fund has an administrative services
agreement with Kemper Distributors, Inc. ("KDI"). KDI provides information and
administrative services to the Treasury Portfolio at an annual fee of up to
0.25% of average daily net assets. For the six months ended September 30, 2000,
the Fund incurred fees as follows:
Portfolio ASF fee Unpaid at
ASF fee waived by September
imposed ($) KDI ($) 30, 2000 ($)
---------------------------------------------------------------------
Treasury Portfolio:
Service Shares -- 22,954 14,956
---------------------------------------------------------------------
Premier Money Market Shares 11,960 -- 1,585
---------------------------------------------------------------------
KDI has related service agreements with various firms to provide cash management
and other services for Fund shareholders. KDI pays these firms at an annual rate
of up to 0.15% of average daily net assets.
Distribution Agreement. Pursuant to a distribution services agreement, KDI
provides distribution and other services to the Premier Money Market Shares of
the Treasury Portfolio at an annual fee of 0.25% of average daily net assets.
For the six months ended September 30, 2000, the Fund incurred a distribution
services fee of $12,123, of which $1,748 is unpaid at September 30, 2000.
Shareholder Services Agreement. Pursuant to a services agreement with the Fund's
transfer agent, Kemper Service Company ("KSvC") is the shareholder service agent
of the Fund. For the six months ended September 30, 2000, KSvC received
shareholder services fees for the Treasury Portfolio of $11,919, of which
$10,710 was unpaid at September 30, 2000.
Officers and Trustees. Certain officers or trustees of the Fund are also
officers or directors of Scudder Kemper. For the six months ended September 30,
2000, the Fund made no payments to its officers and incurred trustees' fees of
$8,983 to independent trustees.
3. Expense Off-Set Arrangements
The Fund has entered into an arrangement with its custodian and transfer agent
whereby credits realized as a result of uninvested cash balances were used to
reduce a portion of the Fund's expenses. During the six months ended September
30, 2000, the Treasury Portfolio's custodian and transfer agent fees were
reduced by $868 and $228, respectively.
4. Line of Credit
The Fund and several Kemper funds (the "Participants") share in a $750 million
revolving credit facility with Chase Manhattan Bank for temporary or emergency
purposes, including the meeting of redemption requests that otherwise might
require the untimely disposition of securities. The Participants are charged an
annual commitment fee which is allocated, pro rata based upon net assets, among
each of the Participants. Interest is calculated based on the market rates at
the time of the borrowing. The Fund may borrow up to a maximum of 33 percent of
its net assets under the agreement.
8
