[LOGO] CMA(R)
CMA MICHIGAN
MUNICIPAL MONEY FUND
Annual Report
March 31, 2000
[LOGO] Merrill Lynch
<PAGE>
TO OUR SHAREHOLDERS:
For the year ended March 31, 2000, CMA Michigan Municipal Money Fund paid
shareholders a net annualized yield of 2.86%.* As of March 31, 2000, the Fund's
7-day yield was 3.16%.
Economic Environment
Michigan's economy grew at a steady pace during the year ended March 31, 2000 as
the state's unemployment rate fell to a record 3.2% in January. This strength in
the state's labor market has helped gradually push Michigan's poverty rate down
to 11% as compared to 13% on the national level. However, tight labor markets
and the continued restructuring of the state's manufacturing industry hindered
stronger performance.
Going forward, Michigan's manufacturing industry is expected to continue
restructuring through mergers, acquisitions and efficiency improvements while
remaining the center of the state's economy. Although the state's cost of doing
business remains high, tax cuts and aggressive economic development programs
will improve Michigan's competitiveness. Specifically, the state plans to cut
unemployment taxes by $200 million during the upcoming year. This will benefit
most of Michigan's 210,000 employers who pay unemployment taxes, reducing their
tax burden by an average of almost 10%. Under these conditions, the University
of Michigan's economists expect that the state's economy may continue to expand
through the end of 2001, although at a slower pace than the 1.6% recorded in
each of the past two years.
Fueled by a strong economy, low unemployment and good weather, seasonal retail
sales surpassed predictions of many industry analysts. According to the Michigan
Retailers December Index, seasonal sales increased 5.9% relative to 1998 and
year-over-year sales increased 5.4%. The survey also reflected that consumers
spent an average 10% more than during the 1998 holiday season. The automobile
industry picked up where it left off as US car and light truck sales rose 7.8%
year-over-year in January 2000. In addition, auto makers are coming off a record
year in 1999 with industry sales totaling 16.95 million units, an increase of
8.8% compared to 1998 and up 5.8% from the previous record set in 1986. Finally,
in September 1999, the United Auto Workers union negotiated a new four-year
contract with Ford Motor Company, DaimlerChrysler, General Motors Corporation
and Delphi Automotive Systems. According to the agreement, production workers
will receive a 3% per annum wage increase for each of the next four years in
addition to a cost of living adjustment, which will provide an annual increase
of about 5%.
Investment Strategy
During the year ended March 31, 2000, the persistent strength of the US economy
continued to fuel an already volatile interest rate environment. We began the
period building on CMA Michigan Municipal Money Fund's relatively bearish
position by continuing to reinvest the proceeds of maturing tax-exempt
commercial paper into variable rate products. We did this in an effort to take
advantage of the higher yields that were expected in April and May 1999 as a
result of cash outflows during tax time. As May 1999 ended, a string of economic
data pointing to the presence of inflationary pressures caused concern about
higher interest rates. These factors, along with comments made by Federal
Reserve Board Chairman Alan Greenspan, caused yields on US Treasury securities
to rise
* Based on a constant investment throughout the period, with dividends
compounded daily, and reflecting a net return to the investor after all
expenses.
1
<PAGE>
significantly as expectations of tighter monetary policy increased. For example,
the yield on the one-year Treasury note, which began the period at 4.70%, rose
to 5.20% by late June, an increase of 50 basis points (0.50%). On June 30, 1999,
the Federal Reserve Board tightened monetary policy by raising the Federal Funds
rate from 4.75% to 5.00%. Given our bearish position, as well as a meager June
inflation report and the need to replace maturing notes, we purchased some
one-year issues. However, with the bulk of the tax-exempt fixed rate supply
expected during the late summer and concerns about inflation by the Federal
Reserve Board once again in July, we maintained this bearish position for the
Fund. On August 24, 1999, the Federal Reserve Board tightened monetary policy
again by increasing the Federal Funds rate 25 basis points to 5.25%. At that
time, we chose to attain a slightly bullish strategy. The basis for this
strategy was twofold. First, comments made by the Federal Reserve Board after
the second interest rate increase were not as negative as those made following
the previous tightening. Second, the expectation of tighter monetary policy,
combined with traditional issuance of cash flows notes in August and September,
caused yields on fixed rate issues to become more attractive, thus providing a
valuable opportunity to take a more aggressive stance.
The second half of the fiscal year ended March 31, 2000 began with economic data
that continued to point to a US economy that was overheating. Consequently, on
November 16, 1999, the Federal Reserve Board tightened monetary policy a third
time, increasing the Federal Funds rate to 5.50%. Although we expected the
Federal Reserve Board would keep monetary policy on hold through year-end
because of Year 2000 worries, we anticipated additional tightening of monetary
policy early in 2000. Thus, during this time we managed the Fund's interest rate
risk by purchasing fixed rate issues that matured within 90 days - 120 days in
order to lock in higher yields than were expected in January and February 2000.
As anticipated, the Federal Reserve Board tightened monetary policy by
increasing the Federal Funds rate 25 basis points at both the February and March
2000 Federal Open Market Committee meetings.
Looking ahead, we continue to believe that the Federal Reserve Board may have to
tighten monetary policy at least once more to slow the domestic economy. In
addition, variable rate products traditionally outperform fixed rate products in
April and May because of cash outflows during tax time. Given these factors, we
ended the period with a slightly defensive position. This strategy allowed the
Fund to perform above the average of its peer group for the year ended March 31,
2000, as measured by IBC's Money Fund Report.
In Conclusion
We thank you for your support of CMA Michigan Municipal Money Fund, and we look
forward to serving your investment needs in the months and years ahead.
Sincerely,
/s/ Terry K. Glenn
Terry K. Glenn
President and Trustee
/s/ Vincent R. Giordano
Vincent R. Giordano
Senior Vice President
/s/ Darrin J. SanFillippo
Darrin J. SanFillippo
Vice President and Portfolio Manager
April 27, 2000
2
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CMA MICHIGAN MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 2000 (IN THOUSANDS)
<TABLE>
<CAPTION>
Face
State Amount Issue Value
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Michigan -- $12,981 ABN Amro, Munitops Certificates Trust, VRDN, Series 1998-13,
98.4% 3.98% due 10/04/2006 (c) ...................................................... $ 12,981
1,210 Battle Creek, Michigan, Housing Corporation, Housing Revenue Bonds, VRDN,
Series 1997-A, 3.85% due 2/01/2027 (c) ........................................ 1,210
3,950 Berrien County, Michigan, Economic Development Corporation Revenue Bonds
(Arlington Corp. Project), VRDN, AMT, 4.10% due 9/01/2016 (c) ................. 3,950
1,100 Breckenridge, Michigan, Community School, GO, SAAN, 4.10% due 8/21/2000 ....... 1,101
7,000 Chippewa Valley, Michigan, School District, SAN, 4.10% due 8/21/2000 .......... 7,009
1,100 Dearborn, Michigan, Sewage Disposal System Revenue Bonds,
7% due 4/01/2000 (b) .......................................................... 1,100
6,000 Detroit, Michigan, City School District, GO, School SAN, 4% due 6/01/2000 ..... 6,008
3,315 Detroit, Michigan, Economic Development Corporation, Resource Recovery
Revenue Bonds, AMT, Series A, 6.35% due 5/01/2000 (d) ......................... 3,322
Detroit, Michigan, Water Supply System Revenue Bonds, VRDN, MSTR (c):
2,000 Series SG-64, 3.96% due 7/01/2025 ......................................... 2,000
2,000 Series SGB-6, 3.96% due 7/01/2025 (b) ..................................... 2,000
15,840 Eagle Tax-Exempt Trust, Grand Rapids, Michigan, Sewer System, VRDN,
Series 98-2201, 3.95% due 1/01/2022 (a)(c) .................................... 15,840
1,085 Farmington Hills, Michigan, Economic Development Corporation, Limited
Obligation Revenue Refunding Bonds (Brookfield Building Association), VRDN,
4.25% due 11/01/2010 (c) ...................................................... 1,085
1,600 Flint, Michigan, Economic Development Corporation, EDR (Plastics Research),
VRDN, AMT, 4.10% due 9/01/2004 (c) ............................................ 1,600
9,700 Flint, Michigan, Hospital Building Authority Revenue Bonds (Hurley Medical
Center), VRDN, Series B, 3.90% due 7/01/2015 (c) .............................. 9,700
1,210 Garden City, Michigan, Hospital Finance Authority, Hospital Revenue Bonds
(Garden City Hospital Obligation), VRDN, Series A, 3.95% due 9/01/2026 (c) .... 1,210
2,300 Georgetown Charter Township, Michigan, IDR, Limited Obligation (J&F Steel
Corp.), VRDN, AMT, 4% due 2/01/2009 (c) ....................................... 2,300
3,325 Grand Rapids, Michigan, Economic Development Corporation, EDR, Refunding
(Amway Hotel Corp. Project), VRDN, Series B, 3.85% due 8/01/2017 (c) .......... 3,325
505 Grand Rapids, Michigan, EDR, Limited Obligation Refunding Bonds (Calder),
VRDN, Series A, 3.85% due 10/01/2011 (c) ...................................... 505
2,275 Grand Rapids, Michigan, IDR, Refunding (Etheridge Company Project), VRDN,
AMT, 4% due 7/01/2009 (c) ..................................................... 2,275
1,200 Grand Rapids, Michigan, Public Schools, GO, 6.50% due 5/01/2000 ............... 1,203
</TABLE>
Portfolio Abbreviations for CMA Michigan Municipal Money Fund
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
CP Commercial Paper
EDR Economic Development Revenue Bonds
GO General Obligation Bonds
HDA Housing Development Authority
IDR Industrial Development Revenue Bonds
M/F Multi-Family
MSTR Municipal Securities Trust Receipts
SAAN Student Aid Anticipation Notes
SAN State Aid Notes
TEAMS Tax-Exempt Adjustable Municipal Securities
VRDN Variable Rate Demand Notes
3
<PAGE>
CMA MICHIGAN MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 2000 (CONTINUED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face
State Amount Issue Value
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Michigan $ 2,800 Grand Rapids, Michigan, Water Supply Revenue Refunding Bonds, VRDN,
(continued) 3.85% due 1/01/2020 (a)(c) .................................................... $ 2,800
4,400 Hartland, Michigan, Consolidated School District, SAN, 4.10% due 8/24/2000 .... 4,404
1,200 Holly, Michigan, Area School District, GO, SAN, 4.20% due 8/22/2000 ........... 1,201
Jackson, Michigan, Public Schools, GO, SAN:
3,200 Series A, 4.40% due 8/23/2000 ............................................. 3,204
4,750 Series B, 4% due 7/06/2000 ................................................ 4,755
485 Lenawee County, Michigan, Economic Development Corporation, Limited
Obligation Revenue Bonds (The Wyatt Project), VRDN, AMT,
4.10% due 5/01/2002 (c) ....................................................... 485
850 Marquette County, Michigan, Economic Development Corporation, Limited
Obligation Revenue Bonds (Pioneer Labs Inc. Project), VRDN, AMT, Series A,
3.97% due 6/01/2012 (c) ....................................................... 850
750 Michigan Higher Education Facilities Authority, Limited Obligation Revenue
Bonds (Davenport College of Business Project), VRDN, 3.90% due 3/01/2027 (c) .. 750
Michigan Municipal Bond Authority Revenue Notes:
6,000 Series A-1, 4% due 6/30/2000 .............................................. 6,008
3,575 Series A-2, 4% due 6/30/2000 .............................................. 3,575
5,000 Series B-1, 4.25% due 8/25/2000 ........................................... 5,013
7,000 Series B-2, 4.25% due 8/25/2000 ........................................... 7,019
16,540 Michigan State Building Authority Revenue Bonds, CP, Series 1,
3.65% due 4/27/2000 ........................................................... 16,540
5,000 Michigan State Building Authority Revenue Bonds (Equipment Program),
Series B, 5% due 4/01/2000 .................................................... 5,000
7,500 Michigan State, COP (New Center Development), 4.75% due 3/01/2001 ............. 7,533
Michigan State, HDA, Limited Obligation Revenue Bonds (c):
1,200 (Laurel Valley), TEAMS, 3.90% due 12/01/2007 .............................. 1,200
4,000 (Sand Creek Apartments, Phase I Project), VRDN, AMT, 4% due 1/01/2029 ..... 4,000
2,000 (Woodland Meadows Project), VRDN, AMT, 4% due 3/01/2013 ................... 2,000
4,000 Michigan State, HDA, M/F Housing Revenue Bonds (Bloomfield on the River
Apartments), CP, AMT, Series A, 4.10% due 7/11/2000 4,000
Michigan State, HDA, M/F Housing Revenue Bonds, CP, AMT, Series A:
8,550 3.85% due 5/11/2000 ....................................................... 8,550
11,000 4.10% due 7/11/2000 ....................................................... 11,000
4,000 Michigan State, HDA, Revenue Refunding Bonds, AMT, Series B,
3.95% due 12/01/2000 .......................................................... 4,000
1,610 Michigan State Hospital Finance Authority, Revenue Refunding Bonds (Mercy
Mount Clemens Corporation), Series A, 3.90% due 5/15/2000 (b) ................. 1,610
</TABLE>
4
<PAGE>
CMA MICHIGAN MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 2000 (CONTINUED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face
State Amount Issue Value
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Michigan Michigan State Strategic Fund, Limited Obligation Revenue Bonds, VRDN (c):
(continued) $ 4,200 (AACOA Estrusions Inc. Project), AMT, 4.10% due 2/01/2008 ................. $ 4,200
740 (Akemi Inc. Project), 4.05% due 3/01/2021 ................................. 740
1,285 (Applied Textiles Inc. Project), AMT, 4% due 7/01/2008 .................... 1,285
3,000 (Automatic Handling Inc. Project), AMT, 4.10% due 7/01/2009 ............... 3,000
400 (BBPV Project), AMT, Series A-2, 4.17% due 1/01/2014 ...................... 400
2,155 (Baron Drawn Steel), AMT, 4.10% due 12/01/2006 ............................ 2,155
2,935 (Biewer of Lansing LLC Project), AMT, 4.15% due 5/01/2019 ................. 2,935
3,500 (CAMAC LLC Project), AMT, 4% due 8/01/2028 ................................ 3,500
1,350 (Chambers Enterprises II Project), AMT, 4.05% due 11/01/2018 .............. 1,350
7,315 (Children's Home--Detroit Project), 4% due 8/01/2029 ...................... 7,315
2,500 (Cincinnati Milacron Inc. Project), AMT, 4.10% due 4/15/2005 .............. 2,500
1,800 (Dott Industries Inc. Project), AMT, 4.10% due 6/01/2001 .................. 1,800
3,500 (Glastender Inc. Project), AMT, 4.10% due 12/01/2010 ...................... 3,500
1,500 (Gollin Block & Supply Co.), AMT, 3.97% due 7/01/2012 ..................... 1,500
5,900 (Graphic Enterprises Inc. Project), AMT, 4.10% due 9/01/2014 .............. 5,900
1,060 (Hercules Drawn Steel Project), AMT, 4.15% due 8/01/2006 .................. 1,060
1,260 (Inalfa-Hollandia Inc. Project), AMT, 4.05% due 5/01/2016 ................. 1,260
2,000 (Ingersoll CM Systems Inc. Project), AMT, 4.10% due 12/01/2011 ............ 2,000
4,800 (Karona Inc. Project), AMT, 4.10% due 12/01/2015 .......................... 4,800
3,700 (Kaumagraph Flint Corporation Project), AMT, 4.10% due 11/01/2014 ......... 3,700
2,500 (Kendor Steel Rule Die Project), AMT, 4.10% due 11/01/2019 ................ 2,500
2,500 (LSCP Investments LLC Project), AMT, 4.10% due 11/01/2019 ................. 2,500
2,010 (Monarch Hydraulics Inc. Project), AMT, 4.05% due 7/01/2016 ............... 2,010
2,000 (Morrell Inc. Project), AMT, 4.05% due 5/01/2022 .......................... 2,000
1,300 (Norbert Industries Inc. Project), AMT, 3.97% due 4/01/2006 ............... 1,300
830 (Northern Pure Ice Co. Project), AMT, 3.97% due 3/01/2015 ................. 830
865 (Nuvar Properties LLC Project), AMT, 4.05% due 7/01/2026 .................. 865
2,300 (Park Realty LLC), AMT, Series A, 4.05% due 9/01/2026 ..................... 2,300
590 (Perfection Steel Inc. Project), 4.05% due 3/01/2002 ...................... 590
6,155 (Pioneer Metal Finishing Project), AMT, 4.05% due 11/01/2008 .............. 6,155
1,725 (R.H. Wyner Association Inc. Project), AMT, 3.90% due 10/01/2026 .......... 1,725
3,300 (Richwood Industries Inc. Project), AMT, 4.10% due 9/01/2030 .............. 3,300
5,645 (Riverwalk Properties LLC Project), AMT, 4.05% due 8/01/2021 .............. 5,645
300 Series C-4, 4.17% due 1/01/2009 ........................................... 300
1,095 (TEI Investments LLC), AMT, 4.05% due 2/01/2022 ........................... 1,095
2,000 (Team Industries Inc. Project), AMT, 4.05% due 3/01/2023 .................. 2,000
3,675 (Temperance Enterprises Company), AMT, 4.10% due 8/01/2011 ................ 3,675
1,205 (Tom Miller Inc. Project), AMT, 4% due 12/01/2009 ......................... 1,205
2,200 (Universal Leasing Inc. Project), AMT, 4.10% due 11/01/2016 ............... 2,200
2,200 (Universal Tube Inc. Project), AMT, 4.10% due 8/01/2011 ................... 2,200
2,000 (Vector Investments LLC Project), AMT, 3.30% due 2/01/2020 ................ 2,000
2,000 (WDKK Development LLC Project), AMT, 4.05% due 1/01/2024 .................. 2,000
3,500 (Waltec American Forgings), AMT, 4.10% due 10/01/2009 ..................... 3,500
375 (Whitehall Industries), AMT, Series A-6, 4.17% due 1/01/2014 .............. 375
Michigan State Strategic Fund, Limited Obligation Revenue Refunding Bonds,
VRDN (c):
800 (Grandview Plaza Project), AMT, 4.10% due 12/15/2010 ...................... 800
4,850 (Lake Shore Inc.), AMT, 4.10% due 11/01/2019 .............................. 4,850
335 (Park Village Pines Project), 3.85% due 5/01/2006 ......................... 335
</TABLE>
5
<PAGE>
CMA MICHIGAN MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 2000 (CONCLUDED) (IN THOUSANDS)
<TABLE>
<CAPTION>
Face
State Amount Issue Value
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Michigan $ 1,800 Muskegon County, Michigan, Economic Development Corporation, Limited
(concluded) Obligation Revenue Refunding Bonds (Baker College), VRDN,
3.90% due 12/01/2021 (c) ...................................................... $ 1,800
4,200 Oakland County, Michigan, Economic Development Corporation, Limited
Obligation Revenue Bonds (V&M Corporation Project), VRDN, AMT,
4.10% due 9/01/2018 (c) ....................................................... 4,200
3,000 Oscoda, Michigan, Area Schools District, SAN, 4.10% due 8/22/2000 ............. 3,003
3,500 Rockford, Michigan, IDR, Limited Obligation (Alloy Exchange Project), VRDN,
AMT, 4.10% due 9/01/2019 (c) .................................................. 3,500
6,700 Saginaw County, Michigan, Economic Development Corporation Revenue Bonds
(Al-Fe Heat Treating Project), VRDN, AMT, 3.75% due 2/01/2010 (c) ............. 6,700
12,800 University of Michigan, University Hospital Revenue Bonds, VRDN, Series A,
3.85% due 12/01/2027 (c) ...................................................... 12,800
1,100 University of Michigan, University Hospital Revenue Refunding Bonds, VRDN,
Series A, 3.85% due 12/01/2019 (c) ............................................ 1,100
5,500 University of Michigan, University Revenue Refunding Bonds (Medical Service
Plan), VRDN, Series A-1, 3.85% due 12/01/2021 (c) ............................. 5,500
8,000 Walled Lake, Michigan, Consolidated School District, Refunding, MSTR, GO,
Series SGA-68, VRDN, 4% due 5/01/2022 (b)(c) .................................. 8,000
2,250 Waterford, Michigan, School District, GO, 4.25% due 5/01/2000 ................. 2,252
6,525 Wayne Charter County, Michigan, Airport Revenue Refunding Bonds (Detroit
Metropolitan County), VRDN, AMT, Series A, 3.90% due 12/01/2016 (c) ........... 6,525
570 Wyoming, Michigan, Economic Development Corporation, Revenue Refunding
Bonds (Family One Inc. Project), VRDN, AMT, 4.05% due 11/01/2019 (c) .......... 570
- ---------------------------------------------------------------------------------------------------------------------
Puerto Rico -- 3,000 Puerto Rico Commonwealth, Government Development Bonds, CP,
0.8% 3.70% due 4/11/2000 ........................................................... 3,000
- ---------------------------------------------------------------------------------------------------------------------
Total Investments (Cost--$357,326*)--99.2% .................................... 357,326
Other Assets Less Liabilities--0.8% ........................................... 3,008
--------
Net Assets--100.0% ............................................................ $360,334
========
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) FGIC Insured.
(b) MBIA Insured.
(c) The interest rate is subject to change periodically based upon prevailing
market rates. The interest rate shown is the rate in effect at March 31,
2000.
(d) FSA Insured.
* Cost for Federal income tax purposes.
See Notes to Financial Statements.
6
<PAGE>
CMA MICHIGAN MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF MARCH 31, 2000
<TABLE>
<CAPTION>
Assets:
<S> <C> <C>
Investments, at value (identified cost--$357,325,584) .............................................. $ 357,325,584
Cash ............................................................................................... 160,643
Interest receivable ................................................................................ 3,179,211
Prepaid registration fees and other assets ......................................................... 26,032
-------------
Total assets ....................................................................................... 360,691,470
-------------
Liabilities:
Payables:
Investment adviser ............................................................................... $140,584
Distributor ...................................................................................... 124,121 264,705
--------
Accrued expenses and other liabilities ............................................................. 93,042
-------------
Total liabilities .................................................................................. 357,747
-------------
Net Assets ......................................................................................... $ 360,333,723
=============
Net Assets Consist of:
Shares of beneficial interest, $.10 par value, unlimited number of shares
authorized ......................................................................................... $ 36,041,654
Paid-in capital in excess of par ................................................................... 324,374,888
Accumulated realized capital losses--net ........................................................... (82,819)
-------------
Net Assets--Equivalent to $1.00 per share based on 360,416,542 shares of
beneficial interest outstanding .................................................................... $ 360,333,723
=============
</TABLE>
See Notes to Financial Statements.
CMA MICHIGAN MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 2000
<TABLE>
<CAPTION>
Investment Income:
<S> <C> <C>
Interest and amortization of premium and discount earned ..................................... $ 13,514,814
Expenses:
Investment advisory fees ..................................................................... $1,926,333
Distribution fees ............................................................................ 477,787
Accounting services .......................................................................... 69,007
Professional fees ............................................................................ 56,291
Transfer agent fees .......................................................................... 53,785
Custodian fees ............................................................................... 34,041
Printing and shareholder reports ............................................................. 23,587
Registration fees ............................................................................ 20,338
Pricing fees ................................................................................. 10,788
Trustees' fees and expenses .................................................................. 2,465
Other ........................................................................................ 7,181
----------
Total expenses ............................................................................... 2,681,603
--------------
Investment income--net ....................................................................... 10,833,211
Realized Loss on Investments--Net ............................................................ (5,068)
--------------
Net Increase in Net Assets Resulting from Operations ......................................... $ 10,828,143
==============
</TABLE>
See Notes to Financial Statements.
7
<PAGE>
CMA MICHIGAN MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the Year Ended March 31,
--------------------------------------
Increase (Decrease) in Net Assets: 2000 1999
- ------------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C>
Investment income--net ................................................................. $ 10,833,211 $ 9,808,075
Realized gain (loss) on investments--net ............................................... (5,068) 77,625
--------------- ---------------
Net increase in net assets resulting from operations ................................... 10,828,143 9,885,700
--------------- ---------------
Dividends to Shareholders:
Dividends to shareholders from investment income--net .................................. (10,833,211) (9,808,075)
--------------- ---------------
Beneficial Interest Transactions:
Net proceeds from sale of shares ....................................................... 1,574,543,444 1,485,901,215
Net asset value of shares issued to shareholders in reinvestment of dividends .......... 10,833,557 9,807,997
--------------- ---------------
1,585,377,001 1,495,709,212
Cost of shares redeemed ................................................................ (1,618,650,417) (1,408,220,996)
--------------- ---------------
Net increase (decrease) in net assets derived from beneficial
interest transactions .................................................................. (33,273,416) 87,488,216
--------------- ---------------
Net Assets:
Total increase (decrease) in net assets ................................................ (33,278,484) 87,565,841
Beginning of year ...................................................................... 393,612,207 306,046,366
--------------- ---------------
End of year ............................................................................ $ 360,333,723 $ 393,612,207
=============== ===============
</TABLE>
See Notes to Financial Statements.
CMA MICHIGAN MUNICIPAL MONEY FUND
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements. For the Year Ended March 31,
---------------------------------------------------------------------------
Increase (Decrease) in Net Asset Value: 2000 1999 1998 1997 1996
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year ................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- -----------
Investment income--net ............................. .03 .03 .03 .03 .03
Realized gain (loss) on investments--net ........... --+ --+ --+ --+ --+
----------- ----------- ----------- ----------- -----------
Total from investment operations ................... .03 .03 .03 .03 .03
----------- ----------- ----------- ----------- -----------
Less dividends from investment income--net ......... (.03) (.03) (.03) (.03) (.03)
----------- ----------- ----------- ----------- -----------
Net asset value, end of year ....................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== ===========
Total Investment Return ............................ 2.86% 2.78% 3.07% 2.90% 3.12%
=========== =========== =========== =========== ===========
Ratios to Average Net Assets:
Expenses ........................................... .70% .71% .71% .72% .73%
=========== =========== =========== =========== ===========
Investment income--net ............................. 2.81% 2.72% 3.02% 2.84% 3.05%
=========== =========== =========== =========== ===========
Supplemental Data:
Net assets, end of year (in thousands) ............. $ 360,334 $ 393,612 $ 306,046 $ 272,969 $ 247,544
=========== =========== =========== =========== ===========
</TABLE>
+ Amount is less than $.01 per share.
See Notes to Financial Statements.
8
<PAGE>
CMA MICHIGAN MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA Michigan Municipal Money Fund (the "Fund") is part of CMA Multi-State
Municipal Series Trust (the "Trust"). The Fund is registered under the
Investment Company Act of 1940 as a non-diversified, open-end management
investment company. The Fund's financial statements are prepared in accordance
with accounting principles generally accepted in the United States of America,
which may require the use of management accruals and estimates. The following is
a summary of significant accounting policies followed by the Fund.
(a) Valuation of investments--Investments are valued at amortized cost, which
approximates market value. For the purpose of valuation, the maturity of a
variable rate demand instrument is deemed to be the next coupon date on which
the interest rate is to be adjusted. In the case of a floating rate instrument,
the remaining maturity is the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no Federal income tax provision is required.
(c) Security transactions and investment income--Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Interest income (including amortization of premium and discount) is recognized
on the accrual basis. Realized gains and losses on security transactions are
determined on the identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are charged to expense
as the related shares are issued.
(e) Dividends and distributions to shareholders--The Fund declares dividends
daily and reinvests daily such dividends (net of non-resident alien tax and
back-up withholding tax withheld) in additional fund shares at net asset value.
Dividends are declared from the total of net investment income, excluding
discounts earned other than original issue discounts. Net realized capital
gains, if any, are normally distributed annually after deducting prior years'
loss carryforward. The Fund may distribute capital gains more frequently than
annually in order to maintain the Fund's net asset value at $1.00 per share.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund Asset
Management, L.P. ("FAM"). The general partner of FAM is Princeton Services, Inc.
("PSI"), an indirect wholly-owned subsidiary of Merrill Lynch & Co., Inc. ("ML &
Co."), which is the limited partner.
FAM is responsible for the management of the Fund's portfolio and provides the
necessary personnel, facilities, equipment and certain other services necessary
to the operations of the Fund. For such services, the Fund pays a monthly fee
based upon the average daily value of the Fund's net assets, at the following
annual rates: .50% of the first $500 million of average daily net assets; .425%
of average daily net assets in excess of $500 million but not exceeding $1
billion; and .375% of average daily net assets in excess of $1 billion.
Pursuant to the Distribution and Shareholder Servicing Plan in compliance with
Rule 12b-1 under the Investment Company Act of 1940, Merrill Lynch, Pierce,
Fenner & Smith Incorporated ("MLPF&S") receives a distribution fee from the Fund
at the end of each month at the annual rate of .125% of average daily net assets
of the Fund. The distribution fee is to compensate MLPF&S financial consultants
and other directly involved branch office personnel for selling shares of the
Fund and for providing direct personal services to shareholders. The
distribution fee is not compensation for the administrative and operational
services rendered to the Fund
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CMA MICHIGAN MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
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, PSI, FDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares sold, reinvested and redeemed during the years corresponds
to the amounts included in the Statements of Changes in Net Assets for net
proceeds from sale of shares, value of shares reinvested and cost of shares
redeemed, respectively, since shares are recorded at $1.00 per share.
4. Capital Loss Carryforward:
At March 31, 2000, the Fund had a net capital loss carryforward of approximately
$83,000, of which $39,000 expires in 2003, $32,000 expires in 2005, $7,000
expires in 2006 and $5,000 expires in 2008. This amount will be available to
offset like amounts of any future taxable gains.
CMA MICHIGAN MUNICIPAL MONEY FUND
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders, CMA Michigan 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 Michigan Municipal Money Fund of CMA
Multi-State Municipal Series Trust as of March 31, 2000, the related statements
of operations for the year then ended and changes in net assets for each of the
years in the two-year period then ended, and the financial highlights for each
of the years in the five-year period then ended. These financial statements and
the financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and the
financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned at March 31, 2000 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 Michigan
Municipal Money Fund of CMA Multi-State Municipal Series Trust as of March 31,
2000, the results of its operations, the changes in its net assets, and the
financial highlights for the respective stated periods in accordance with
accounting principles generally accepted in the United States of America.
Deloitte & Touche llp
Princeton, New Jersey
May 2, 2000
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CMA MICHIGAN MUNICIPAL MONEY FUND
IMPORTANT TAX INFORMATION (UNAUDITED)
All of the net investment income distributions paid daily by CMA Michigan
Municipal Money Fund of CMA Multi-State Municipal Series Trust during its
taxable year ended March 31, 2000 qualify as tax-exempt interest dividends for
Federal income tax purposes.
Additionally, there were no capital gains distributed by the Fund during its
taxable year ended March 31, 2000.
Please retain this information for your records.
CMA MICHIGAN MUNICIPAL MONEY FUND
OFFICERS AND TRUSTEES
Terry K. Glenn--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Arthur Zeikel--Trustee
Vincent R. Giordano--Senior Vice President
Edward J. Andrews--Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Steven T. Lewis--Vice President
Darrin J. SanFillippo--Vice President
Kevin A. Schiatta--Vice President
Helen Marie Sheehan--Vice President
Donald C. Burke--Vice President and
Treasurer
William E. Zitelli--Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 221-7210*
* For inquiries regarding your CMA account, call (800) CMA-INFO [(800)
262-4636].
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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. 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 the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund. Past performance
results shown in this report should not be considered a representation of future
performance, which will fluctuate. Statements and other information herein are
as dated and are subject to change.
CMA Michigan
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011 #16056--3/00
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