CMA
CMA NORTH CAROLINA
MUNICIPAL MONEY FUND
Annual Report
March 31, 1994
Merrill Lynch BULL LOGO
Officers and Trustees
Arthur Zeikel--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Terry K. Glenn--Executive Vice President
Vincent R. Giordano--Senior Vice President
Edward J. Andrews--Vice President
Donald C. Burke--Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Kevin A. Schiatta--Vice President
Helen Marie Sheehan--Vice President
Gerald M. Richard--Treasurer
Robert Harris--Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, Massachusetts 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 221-7210*
[FN]
*For inquiries regarding your CMA account,
call (800) CMA-INFO [(800) 262-4636].
<PAGE>
This report is not authorized for use as an offer
of sale or a solicitation of an offer to buy shares
of the Fund unless accompanied or preceded by
the Fund's current prospectus. Past performance
results shown in this report should not be con-
sidered a representation of future performance,
which will fluctuate. The Fund seeks to maintain
a consistent $1.00 net asset value per share,
although this cannot be assured. An investment
in the Fund is neither insured nor guaranteed
by the US Government.
CMA North Carolina
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011
TO OUR SHAREHOLDERS:
For the year ended March 31, 1994, CMA North Carolina Municipal
Money Fund paid shareholders a net annualized yield of 1.85%*. As
of March 31, 1994, the Fund's 7-day yield was 1.63%.
The Environment
Inflationary expectations changed sharply during the March
quarter. Following better-than-expected economic results, Federal
Reserve Board Chairman Alan Greenspan indicated in Congressional
testimony in January that continued strong expansion of the
economy would lead the central bank to tighten monetary policy in
an effort to control inflation. On February 4, 1994, the central
bank broke with tradition and publicly announced a modest 25
basis point (0.25%) increase in short-term interest rates. At the
March 22 meeting of the Federal Open Market Committee, the
Federal Reserve Board again raised the Federal Funds rate by 25
basis points, and also announced the increase.
<PAGE>
Rather than view the Federal Reserve Board's first tightening
move as a preemptive strike against inflation, fixed-income
investors focused on Chairman Greenspan's implicit promise of
further tightening should the rate of inflation accelerate, and
bond prices declined sharply. The setback in the bond market was
also reflected in greater stock market volatility. While the
second increase in the Federal Funds rate was less of a surprise,
investors remained concerned that interest rates would trend
upward sharply. As a result, stock and bond prices continued to
decline through the end of March. The volatility in the US
capital markets was mirrored in international markets. Political
and economic developments, along with concerns of heightened
global inflationary pressures, led to a sell-off in most capital
markets, especially the emerging markets that had appreciated
strongly in 1993.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
In the weeks ahead, investors will continue to gauge the pace of
the economic expansion and watch for signs of an overheating
economy. At this time, there is little evidence that the rate of
inflation will increase rapidly. Therefore, although the secular
long-term trend toward lower interest rates may be over, it is
not yet certain whether the pace of economic activity will
accelerate to the point where significant Federal Reserve Board
tightening will be necessary to contain inflation.
Investment Outlook and Strategy
During the six-month period ended March 31, 1994, the State of
North Carolina continued to exercise budget discipline, maintain
strong financial operations and improve its financial
flexibility. As a result, Moody's Investors Service, Inc. and
Standard & Poor's Corp. once again confirmed the State's AAA
rating. In addition, the State's economy continues to grow, and
unemployment remains among the lowest in the nation at 4.3%.
The current 1993--1994 biennium budget has left the State with a
$443 million surplus at year-end which is attributed to higher-
than-expected income tax revenues and lower-than-expected
expenditures. In mid-February, Governor Jim Hunt proposed a $32.6
billion all-funds budget for the fiscal 1994--1995 biennium that
projects a 6% growth in tax receipts, $100 million in spending
cuts and $1 billion in spending for education.
<PAGE>
North Carolina's January issue of $400 million in general
obligation capital improvement bonds to finance improvements for
parks, clean water systems and State higher education was the
first issue of a $740 million referendum that was passed by
voters on November 2, 1993. The remaining balance of $340
million, however, is not expected to be issued for two years. The
State of North Carolina's issuance of new short-term debt during
the six-month period ended March 31, 1994 totaled $29 million, a
decrease from the $52.8 million brought to market during the
previous six months.
At the outset of the period, the Fund maintained a relatively
aggressive average portfolio maturity in view of the expected
lack of short-term issuance at the beginning of 1994.
Subsequently, with the expectation that the Federal Reserve Board
would tighten monetary policy, the Fund decreased its average
portfolio maturity to take advantage of anticipated higher
interest rates during the second half of the period. CMA North
Carolina Municipal Money Fund's average portfolio maturity, which
began the period in the 75-day range, concluded in the 35-day
range. We continue to work closely with our research department
to provide the highest quality portfolio possible, while seeking
to offer shareholders an attractive tax-exempt yield.
We thank you for your continued support of CMA North Carolina
Municipal Money Fund, and we look forward to serving your
investment needs in the future.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President and Portfolio Manager
April 28, 1994
Portfolio Abbreviations for CMA North Carolina Municipal Money Fund
AMT Alternative Minimum Tax (subject to)
BAN Bond Anticipation Notes
COP Certificates of Participation
CP Commercial Paper
DDN Daily Demand Notes
GO General Obligation Bonds
IDA Industrial Development Authority
IDR Industrial Development Revenue Bonds
TRAN Tax Revenue Anticipation Notes
VRDN Variable Rate Demand Notes
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1994 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
North $ 1,000 Beaufort County, North Carolina, Industrial Facilities and Pollution Control
Carolina--84.5% Finance Authority Revenue Bonds (Texasgulf, Inc. Project), VRDN, Series 1985,
2.45% due 12/01/2000 (a) $ 1,000
1,100 Buncombe County, North Carolina (School and Community Project), BAN, 2.38%
due 4/27/1994 1,100
3,000 Carteret County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority, IDR (Texasgulf, Inc. Project), VRDN, 2.45% due 10/01/2005 (a) 3,000
12,100 Charlotte, North Carolina, Airport Revenue Refunding Bonds, VRDN, Series A,
2.25% due 7/01/2016 (a) 12,100
Charlotte, North Carolina, Revenue Bonds:
1,000 5% due 7/01/1994 1,006
1,000 7% due 7/01/1994 1,011
6,600 Charlotte, North Carolina, Revenue Refunding Bonds, 6.70% due 7/01/1994 6,669
Craven County, North Carolina, Industrial Facilities and Pollution Control Finance
Authority Revenue Bonds (Cravenwood Energy Project), DDN, AMT (a):
2,440 Series A, 2.75% due 5/01/2011 2,440
10,600 Series B, 2.75% due 5/01/2011 10,600
300 Series C, 2.75% due 5/01/2011 300
Cumberland County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority, Revenue Refunding Bonds (Monsanto Co. Project), VRDN (a):
1,715 2.10% due 6/01/2012 1,715
600 2.10% due 10/01/2014 600
2,524 Duplin County, North Carolina, Water District Bonds, BAN, 2.60% due 4/06/1994 2,524
9,769 FB North Carolina, Floating Trust Certificates, VRDN, Series I, 2.30% due
7/01/1995 (a) 9,769
2,000 Gaston County, North Carolina, Industrial Facilities and Pollution Control Finance
Authority Revenue Bonds (Mount Holly Enterprises/Queens G.P. Inc), VRDN,
AMT, 2.55% due 5/01/2004 (a) 2,000
Granville County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority Revenue Bonds, VRDN, AMT (a):
4,000 (Mayville Metal Production Project), 2.40% due 5/23/2020 4,000
2,800 (Tuscarora Plastics, Inc. Project), 2.55% due 12/01/2001 2,800
500 Greene County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority, IDA, Revenue Bonds (Federal Paper Board Company Inc.
Project), VRDN, AMT, 2.45% due 11/01/2009 (a) 500
850 Guilford County, North Carolina, GO, 5.25% due 4/01/1994 850
1,185 Guilford County, North Carolina, Refunding Bonds, GO, 4.80% due 4/01/1994 1,185
8,000 Halifax County, North Carolina, Industrial Facilities and Pollution Control Finance
Authority Revenue Bonds (Westmoreland Project), DDN, AMT, 3% due
12/01/2019 (a) 8,000
8,050 Iredell County, North Carolina, Industrial Facilities and Pollution Control Finance
Authority Revenue Bonds (Rubbermaid Specialty Products, Inc.), 2.65% due
6/01/1994 8,050
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1994 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
North Carolina $ 3,700 Lenoir County, North Carolina, Industrial Facilities and Pollution Control Finance
(continued) Authority Revenue Bonds (West Co. Nebraska, Inc. Project), VRDN, 2.40% due
10/01/2005 (a) $ 3,700
9,500 Lincoln County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority Revenue Bonds (Hof Textiles Inc. Project), VRDN, AMT,
2.25% due 10/01/2011 (a) 9,500
Mecklenberg County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority Revenue Bonds:
1,000 (Edgecomb Metals Company Project), VRDN, 2.325% due 12/01/2009 (a) 1,000
1,000 (Flawa Corp. Project), AMT, 2.10% due 12/01/2008 1,000
North Carolina Eastern Municipal Power Agency, Power System Revenue
Bonds, CP, Series B:
4,950 2.55% due 4/07/1994 4,950
2,000 2.50% due 5/19/1994 2,000
5,000 2.70% due 7/13/1994 5,000
5,800 2.50% due 7/14/1994 5,800
North Carolina Educational Facilities Finance Agency Revenue Bonds, VRDN (a):
7,350 (Bowman Grey School of Medicine Project), 2.20% due 9/01/2020 7,350
1,500 (Duke University Project), Series A, 2.15% due 6/01/2027 1,500
5,600 (Duke University Project), Series B, 2.15% due 12/01/2021 5,600
3,900 (Various Duke University Project), Series A, 2.15% due 12/01/2017 3,900
2,700 (Wake Forest University Project), 1.95% due 1/01/2009 2,700
North Carolina Medical Care Commission, Hospital Revenue Bonds:
5,100 (Duke University Hospital), VRDN, Series B, 2.15% due 6/01/2015 (a) 5,100
1,130 (Duke University Hospital), VRDN, Series D, 2.15% due 6/01/2015 (a) 1,130
11,600 (North Carolina Baptist Hospital Project), VRDN, Series B, 2.20% due
6/01/2022 (a) 11,600
8,900 (Park Ridge Hospital Project), VRDN, 2.25% due 8/15/2018 (a) 8,900
6,400 (Pooled Equipment Finance Project), VRDN, 2.30% due 12/01/2025 (a) 6,400
8,540 (Wesley Long Community Hospital Project), 2.85% due 4/01/1994 8,540
600 (Wilson Memorial Hospital Project), 5.80% due 11/01/1994 611
7,600 North Carolina Medical Care Commission Revenue Bonds (Carol Woods Project),
DDN, 3.05% due 4/01/2021 (a) 7,600
21,600 North Carolina Medical Care Commission, Revenue Refunding Bonds (Moses H.
Cone Memorial Hospital Project), VRDN, 2.20% due 10/01/2023 (a) 21,600
1,000 North Carolina State, GO, 5.70% due 6/01/1994 1,005
700 Rowan County, North Carolina, Industrial Facilities and Pollution Control
Finance Authority Revenue Bonds (Reynolds Metals Company Project), VRDN,
2.70% due 6/01/1994 (a) 700
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1994 (CONCLUDED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
North Carolina $ 9,000 Union County, North Carolina, Industrial Facilities and Pollution Control
(concluded) Financing Authority, IDR, Refunding (Square D Co. Project), VRDN, 2.20% due
3/01/2003 (a) $ 9,000
4,500 University of North Carolina, Chapel Hill Foundation, Inc., COP, CP, 2% due
4/22/1994 4,500
4,250 University of North Carolina, Chapel Hill Revenue Bonds (Kenan Memorial
Stadium), VRDN, 2.30% due 11/01/2007 (a) 4,250
3,000 University of North Carolina, Chapel Hill, School of Medicine and Ambulatory
Care Clinic Revenue Bonds, 2.30% due 10/01/2002 3,000
Wake County, North Carolina, Industrial Facilities and Pollution Control Finance
Authority Revenue Bonds:
200 (Carolina Power and Light Company), DDN, AMT, 3.10% due 3/01/2017 (a) 200
4,500 (Carolina Power and Light Company), VRDN, Series C, 2.40% due
10/01/2015 (a) 4,500
5,000 (P and L Company Project), CP, 2.35% due 4/06/1994 5,000
2,000 Wayne County, North Carolina, Industrial Facilities and Pollution Control
Financing Authority, Revenue Refunding Bonds, VRDN, 2.20% due 12/01/2000 (a) 2,000
1,350 Winston-Salem, North Carolina, Urban Redevelopment, Mortgage Revenue
Refunding Bonds (Summit Square Gardens Apts.), CP, 2.05% due 4/27/1994 1,350
6,000 Winston-Salem, North Carolina, Water and Sewer System Revenue Bonds, CP,
2.65% due 6/16/1994 6,000
Puerto Rico-- 30,185 Commonwealth of Puerto Rico, TRAN, Series A, 3% due 7/29/1994 30,218
15.0% 600 Puerto Rico Commonwealth, Government Development Bank, Revenue Refunding
Bonds, VRDN, 2% due 12/01/2015 (a) 600
5,000 Puerto Rico Commonwealth, Highway and Transportation Authority, Highway
Revenue Bonds, VRDN, Series X, 2.05% due 7/01/1999 (a) 5,000
Puerto Rico, Industrial, Medical and Environmental Pollution Control Facilities,
Financing Authority Revenue Bonds:
1,700 (Anna G. Mendez Foundation), CP, 1.85% due 4/22/1994 1,700
2,250 (Merck & Co. Inc. Project), Series A, VRDN, 2.70% due 12/01/1994 2,250
4,000 (Reynolds Metal Co. Project), VRDN, 2.90% due 9/01/1994 4,002
Total Investments (Cost--$291,975*)--99.5% 291,975
Other Assets Less Liabilities--0.5% 1,477
--------
Net Assets--100.0% $293,452
========
<FN>
(a)The interest rate is subject to change periodically based on certain indexes.
The interest rates shown are the rates in effect at March 31, 1994.
* Cost for Federal income tax purposes.
See Notes to Financial Statements.
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES AS OF MARCH 31, 1994
<S> <C> <C>
Assets:
Investments, at value (identified cost--$291,974,570) (Note 1a) $ 291,974,570
Cash 199,935
Interest receivable 1,461,743
Deferred organization expenses (Note 1d) 17,459
Prepaid registration fees and other assets (Note 1d) 933
-------------
Total assets 293,654,640
-------------
Liabilities:
Payables:
Investment adviser (Note 2) $ 98,249
Distributor (Note 2) 49,544
Beneficial interest redeemed 31 147,824
------------
Accrued expenses and other liabilities 54,984
-------------
Total liabilities 202,808
-------------
Net Assets $ 293,451,832
=============
Net Assets Consist of:
Shares of beneficial interest, $.10 par value, unlimited number of shares authorized $ 29,346,696
Paid-in capital in excess of par 264,120,266
Undistributed investment income--net 298
Accumulated realized capital losses--net (Note 4) (15,428)
-------------
Net Assets--Equivalent to $1.00 per share based on 293,466,962 shares of beneficial
interest outstanding $ 293,451,832
=============
See Notes to Financial Statements.
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 1994
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 5,834,768
Expenses:
Investment advisory fees (Note 2) $ 1,193,861
Distribution fees (Note 2) 297,463
Transfer agent fees (Note 2) 41,338
Professional fees 35,378
Accounting services (Note 2) 34,996
Registration fees (Note 1d) 23,335
Custodian fees 21,411
Printing and shareholder reports 21,118
Amortization of organization expenses (Note 1d) 8,097
Pricing fees 7,678
Trustees' fees and expenses 3,053
Other 2,088
------------
Total expenses before reimbursement 1,689,816
Reimbursement of expenses (Note 2) (238,772)
------------
Total expenses after reimbursement 1,451,044
-------------
Investment income--net 4,383,724
Realized Loss on Investments--Net (Note 1c) (14,754)
-------------
Net Increase in Net Assets Resulting from Operations $ 4,368,970
=============
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended March 31,
1994 1993
Increase (Decrease) in Net Assets:
<S> <C> <C>
Operations:
Investment income--net $ 4,383,724 $ 4,913,631
Realized gain (loss) on investments--net (14,754) 105
------------- -------------
Net increase in net assets resulting from operations 4,368,970 4,913,736
------------- -------------
Dividends to Shareholders (Note 1e):
Investment income--net (4,380,466) (4,912,181)
------------- -------------
Net decrease in net assets resulting from dividends to shareholders (4,380,466) (4,912,181)
------------- -------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 819,514,191 856,834,367
Net asset value of shares issued to shareholders in reinvestment of dividends
(Note 1e) 4,380,479 4,912,146
------------- -------------
823,894,670 861,746,513
Cost of shares redeemed (765,815,611) (847,423,772)
------------- -------------
Net decrease in net assets derived from beneficial interest transactions 58,079,059 14,322,741
------------- -------------
Net Assets:
Total increase in net assets 58,067,563 14,324,296
Beginning of year 235,384,269 221,059,973
------------- -------------
End of year* $ 293,451,832 $ 235,384,269
============= =============
<FN>
* Undistributed investment income--net $ 298 $ 1,692
============= =============
See Notes to Financial Statements.
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
For the
Period
The following per share data and ratios have been derived May 28,
from information provided in the financial statements. 1991++
For the Year Ended March 31, to March 31,
Increase (Decrease) in Net Asset Value: 1994 1993 1992
<S> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
---------- ---------- ----------
Investment income--net .02 .02 .03
---------- ---------- ----------
Total from investment operations .02 .02 .03
---------- ---------- ----------
Less dividends:
Investment income--net (.02) (.02) (.03)
---------- ---------- ----------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
========== ========== ==========
Total Investment Return 1.85% 2.25% 3.49%*
========== ========== ==========
Ratios to Average Net Assets:
Expenses, net of reimbursement and excluding distribution fees .48% .45% .33%*
========== ========== ==========
Expenses, net of reimbursement .61% .57% .45%*
========== ========== ==========
Expenses .71% .73% .83%*
========== ========== ==========
Investment income--net 1.84% 2.20% 3.25%*
========== ========== ==========
Supplemental Data:
Net assets, end of period (in thousands) $ 293,452 $ 235,384 $ 221,060
========== ========== ==========
<FN>
*Annualized.
++Commencement of Operations.
See Notes to Financial Statements.
</TABLE>
<PAGE>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA North Carolina Municipal Money Fund (the "Fund") is part of
CMA Multi-State Municipal Series Trust (the "Trust"). The Fund
is registered under the Investment Company Act of 1940 as a non-
diversified, open-end investment management company. The
following is a summary of significant accounting policies
followed by the Fund.
(a) Valuation of investments--Investments are valued at amortized
cost, which approximates market. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be
the next coupon date on which the interest rate is to be
adjusted. In the case of a floating rate instrument, the
remaining maturity is the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income
tax provision is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are
entered into (the trade dates). Interest income (including
amortization of premium and discount) is recognized on the
accrual basis. Realized gains and losses on security transactions
are determined on the identified cost basis.
(d) Deferred organization expenses and prepaid registration
fees--Deferred organization expenses are charged to expense on a
straight-line basis over a five-year period. Prepaid registration
fees are charged to expense as the related shares are issued.
(e) Dividends to shareholders--The Fund declares dividends daily
and reinvests daily such dividends (net of non-resident alien tax
withheld) in additional fund shares at net asset value. Dividends
are declared from the total of net investment income, excluding
discounts earned other than original issue discounts. Net
realized capital gains, if any, are normally distributed annually
after deducting prior years' loss carryforward. The Fund may
distribute capital gains more frequently than annually in order
to maintain the Fund's net asset value at $1.00 per share.
<PAGE>
(f) Reclassifications--Undistributed investment income--net, in
the amount of $4,652, has been reclassified to accumulated
realized capital losses--net.
2. Investment Advisory Agreement and Transactions with
Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Fund Asset Management, L.P. ("FAM"). Effective January 1, 1994,
the investment advisory business of FAM was reorganized from a
corporation to a limited partnership. Both prior to and after the
reorganization, ultimate control of FAM was vested with Merrill
Lynch & Co., Inc. ("ML & Co."). The general partner of FAM is
Princeton Services, Inc., an indirect wholly-owned subsidiary of
ML & Co. The limited partners are ML & Co. and Merrill Lynch
Investment Management, Inc. ("MLIM"), which is also an indirect
wholly-owned subsidiary of ML & Co.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and
certain other services necessary to the operations of the Fund.
For such services, the Fund pays a monthly fee based upon the
average daily value of the Fund's net assets at the following
annual rates: 0.50% of the Fund's average daily net assets not
exceeding $500 million; 0.425% of average daily net assets in
excess of $500 million but not exceeding $1 billion; and 0.375%
of average daily net assets in excess of $1 billion. FAM has
elected to waive a portion of its fee. For the year ended March
31, 1994, FAM earned a fee of $1,193,861, of which $238,772 was
voluntarily waived.
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
The most restrictive annual expense limitation requires that the
adviser reimburse the Fund to the extent the Fund's expenses
(excluding interest, taxes, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed in any fiscal year
2.5% of the Fund's first $30 million of average daily net assets,
2.0% of the next $70 million of average daily net assets, and
1.5% of the average daily net assets in excess thereof. No fee
payment will be made to the Investment Adviser during any year
which will cause such expenses to exceed the pro rata expense
limitation at the time of such payment.
<PAGE>
Pursuant to the Distribution and Shareholder Servicing Plan in
compliance with Rule 12b-1 under the Investment Company Act of
1940, Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S")
receives a distribution fee from the Fund at the end of each
month at the annual rate of 0.125% of the average daily net
assets of the Fund. The distribution fee is to compensate MLPF&S
financial consultants and other directly involved branch office
personnel for selling shares of the Fund and for providing direct
personal services to shareholders. The distribution fee is not
compensation for the administrative and operational services
rendered to the Fund by MLPF&S in processing share orders and
administering shareholder accounts.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary
of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, MLIM, MLPF&S, FDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the period
corresponds to the amounts included in the Statements of Changes
in Net Assets for net proceeds from sale of shares and cost of
shares redeemed, respectively, since shares are recorded at $1.00
per share.
4. Capital Loss Carryforward:
At March 31, 1994, the Fund had a net capital loss carryforward
of approximately $15,400, of which $5,100 expires in 2001 and
$10,300 expires in 2002. This amount will be available to offset
like amounts of any future taxable gains.
<AUDIT-REPORT>
CMA NORTH CAROLINA MUNICIPAL MONEY FUND
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders,
CMA North Carolina Municipal Money Fund
of CMA Multi-State Municipal Series Trust:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of CMA
North Carolina Municipal Money Fund of CMA Multi-State Municipal
Series Trust as of March 31, 1994, the related statements of
operations for the year then ended and changes in net assets
for each of the years in the two-year period then ended, and
the financial highlights for the two-year period then ended
and the period May 28, 1991 (commencement of operations) to
March 31, 1992. These financial statements and the financial
highlights are the responsibility of the Fund's management.
Our responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.
<PAGE>
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements and financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of
securities owned at March 31, 1994 by correspondence with the
custodian. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial
highlights present fairly, in all material respects, the
financial position of CMA North Carolina Municipal Money Fund of
CMA Multi-State Municipal Series Trust as of March 31, 1994, the
results of its operations, the changes in its net assets, and the
financial highlights for the respective stated periods in
conformity with generally accepted accounting principles.
Deloitte & Touche
Princeton, New Jersey
April 29, 1994
</AUDIT-REPORT>
IMPORTANT TAX INFORMATION (UNAUDITED)
All of the net investment income distributions paid daily by CMA
North Carolina Municipal Money Fund on CMA Multi-State Municipal
Series Trust during the taxable year ended March 31, 1994 qualify
as tax-exempt interest dividends for Federal income tax purposes.
Additionally, there were no capital gains distributed during the
Fund's taxable year ended March 31, 1994.
Please retain this information for your records.
