Scudder
Cash
Investment
Trust
Semiannual Report
December 31, 1995
o A money market fund for investors seeking stability and liquidity of
capital and current income.
o A pure no-load(TM) fund with no commissions to buy, sell, or exchange
shares.
Shares of Scudder Cash Investment Trust are not insured or guaranteed by the
U.S. Government. The Fund seeks to maintain a constant net asset value of $1.00
per share but there can be no assurance that the stable net asset value will be
maintained.
This information must be preceded or accompanied by a current prospectus.
Portfolio changes should not be considered recommendations for action by
individual investors.
65-6-26
MIS65S
<PAGE>
SCUDDER CASH INVESTMENT TRUST
TABLE OF CONTENTS
3 Letter from the Fund's President
4 Portfolio Management Discussion
Your portfolio management team reviews the period's investing strategies,
financial markets, and economic conditions
6 Investment Portfolio
Itemized list of portfolio holdings
9 Financial Statements
12 Financial Highlights
13 Notes to Financial Statements
16 Tax Information
17 Officers and Trustees
18 Investment Products and Services
19 How to Contact Scudder
2
<PAGE>
LETTER FROM THE FUND'S PRESIDENT
Dear Shareholders,
U.S. stock and bond markets surged in 1995. Stocks increased
dramatically as interest rates dropped and corporate profits grew. Bond prices
rose significantly in response to falling interest rates and a favorable outlook
for inflation, producing their third-best annual total return on record.
Money market funds generally provided attractive returns during the
semiannual period, despite falling interest rates that resulted in lower yields.
As of December 31, 1995, for example, taxable money funds on average posted a
7-day yield of 5.15%. Money funds consistently attracted assets, ending the year
at approximately $775 billion in total assets, up from $697 billion six months
ago, according to IBC's Money Fund Report.
Continued interest in money market investments stemmed partly from the
fact that investors seeking the lower relative risk of money funds compared with
stocks and bonds found yields that were generally more attractive than those
available from bank savings accounts and certificates of deposit (of course, the
funds are not insured or guaranteed by the U.S. government). In addition, money
fund yields were well above the rate of inflation, which now stands at about 2%.
We expect this situation to continue given our outlook for the same or a lower
rate of inflation in 1996.
While yields will continue to fluctuate with prevailing interest rates,
Scudder Cash Investment Trust is designed to provide a relatively safe place for
your short-term investment needs. In addition, the Fund seeks to maintain a
constant $1.00 share price (although this cannot be guaranteed), and has done so
since its inception in 1975. Please call a Scudder Investor Relations
representative at 1-800-225-2470 if you have any questions. Thank you for
choosing Scudder Cash Investment Trust to help meet your investment needs.
Sincerely,
/s/David S. Lee
David S. Lee
President,
Scudder Cash Investment Trust
3
<PAGE>
SCUDDER CASH INVESTMENT TRUST
PORTFOLIO MANAGEMENT DISCUSSION
Dear Shareholders,
Scudder Cash Investment Trust posted a competitive 4.85% 7-day net
annualized yield at the close of the semiannual period ended December 31, 1995.
The Fund provided investors with $0.025 per share in income distributions,
contributing to a 2.53% total return for the period. The Fund continues to
emphasize quality money market investments, enabling it to maintain the highest
quality rating (AAAm) from Standard & Poor's.
Challenges in a Falling Interest Rate Environment
Money fund managers have some means of counteracting the effects of a
declining interest-rate environment to help preserve money fund yields,
including manipulation of a fund's average maturity. When interest rates fall,
cash received from maturing investments generally must be reinvested at lower
rates, causing yields of money market funds to decline. With the economy
continuing to slow, the Federal Reserve may lower interest rates further. In
view of this outlook, we extended the Fund's average maturity during the fiscal
year to lock in current, higher yields. Scudder Cash Investment Trust's average
maturity was 54 days at the close of the six-month fiscal period -- just
slightly shorter than the 60-day limit allowable for a highest-quality rating
from Standard & Poor's. By comparison, the Fund's average maturity was 30 days
as of December 31, 1994. We expect that in the coming months Scudder Cash
Investment Trust's average maturity will remain as close to the 60-day maximum
as is necessary to capture higher yields.
Locating Attractive Yield Opportunities
Corporate commercial paper offered the most attractive yields available
during the period and remained a significant portion of the portfolio. These
securities provide companies with short-term funds at a lower rate than loans
offered by banks. Commercial paper made up approximately 55% of the portfolio at
the end of the period.
Floating rate notes (FRNs), 23% of the portfolio at the close of the
period, currently offer less yield opportunity, and we are continuing to reduce
the Fund's exposure to these instruments. Interest rates of these securities
"float" above a particular index, typically providing higher yields than
three-month Treasury bills and some commercial paper. However, these investments
currently provide little more yield than the index above which they
4
<PAGE>
float. FRNs should again prove to be attractive investments when the spread
widens between yields of long-term and short-term investments.
Looking Ahead
With the economy moving at its current slow pace and inflation under
control, Scudder Cash Investment Trust will continue to lean toward longer-term
money market securities to help earn a competitive yield. Meanwhile, quality
investments should help to provide a stable share price. Given these
characteristics, we believe Scudder Cash Investment Trust remains an appropriate
place for your short-term investment needs and can play an important role in
your investment plan. Please call Scudder Investor Relations at 1-800-225-2470
if you have any questions about the Fund. PORTFOLIO MANAGEMENT DISCUSSION
Sincerely,
Your Portfolio Management Team
/s/Stephen L. Akers /s/Robert T. Neff
Stephen L. Akers Robert T. Neff
/s/Debra A. Hanson /s/K. Sue Cote
Debra A. Hanson K. Sue Cote
5
<PAGE>
SCUDDER CASH INVESTMENT TRUST
INVESTMENT PORTFOLIO AS OF DECEMBER 31, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
% of Principal Value ($)
Portfolio Amount ($) (Note A)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
2.8% REPURCHASE AGREEMENTS
30,000,000 Repurchase Agreement with Donaldson,
Lufkin & Jenrette, dated 12/29/95 at 5.85%,
to be repurchased at $30,019,500
on 1/2/96, collateralized by a $26,699,000
U.S. Treasury Note, 8.875%, 2/15/99 . . . . . . . . 30,000,000
10,514,000 Repurchase Agreement with State Street Bank
and Trust Company, dated 12/29/95 at 5.75%,
to be repurchased at $10,520,717 on 1/2/96
collateralized by a $10,515,000 U.S. Treasury
Note, 7.625%, 4/30/96 . . . . . . . . . . . . . . . 10,514,000
--------------
TOTAL REPURCHASE AGREEMENTS
(Cost $40,514,000) . . . . . . . . . . . . . . . . 40,514,000
--------------
55.4% COMMERCIAL PAPER
CONSUMER STAPLES 2.0%
FOOD & BEVERAGE 19,000,000 Heinz (H.J.), 5.46%, 6/18/96 . . . . . . . . . . . . . 18,522,678
10,000,000 Sara Lee Corp., 5.7%, 1/16/96 . . . . . . . . . . . . 9,974,710
--------------
28,497,388
--------------
HEALTH 1.3%
PHARMACEUTICALS 19,000,000 Warner-Lambert, 5.46%, 6/24/96 . . . . . . . . . . . . 18,505,831
--------------
COMMUNICATIONS 1.7%
TELEPHONE/
COMMUNICATIONS 25,000,000 Ameritech Corp., 5.4%, 4/8/96 . . . . . . . . . . . . 24,634,250
--------------
FINANCIAL 50.4%
BANKS 8.2% 35,000,000 ABN-AMRO N.A. Finance, 5.57%, 2/21/96 . . . . . . . . 34,720,427
40,000,000 Barclays U.S. Funding Corp., 5.05%, 1/8/96 . . . . . . 39,955,200
25,000,000 Deutsche Bank Financial Inc., 5.67%, 1/24/96 . . . . . 24,905,830
20,000,000 Deutsche Bank Financial Inc., 5.4%, 4/15/96 . . . . . 19,686,711
--------------
119,268,168
--------------
INSURANCE 0.7% 10,000,000 Prudential Funding Corp., 5.17%, 9/23/96 . . . . . . 9,630,556
--------------
BUSINESS FINANCE 10.2% 20,000,000 CIT Holdings Group, 5.57%, 2/9/96 . . . . . . . . . . 19,876,933
25,000,000 Ciesco L.P., 5.56%, 3/7/96 . . . . . . . . . . . . . 24,744,097
40,000,000 New Center Asset Trust, 5.44%, 1/17/96 . . . . . . . . 39,897,422
25,000,000 New Center Asset Trust, 5.67%, 1/26/96 . . . . . . . . 24,897,983
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
6
<PAGE>
INVESTMENT PORTFOLIO
<TABLE>
<CAPTION>
% of Principal Value ($)
Portfolio Amount ($) (Note A)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
22,000,000 Xerox Credit Corp., 5.67%, 1/19/96 . . . . . . . . . . 21,934,395
15,000,000 Xerox Credit Corp., 5.42%, 2/1/96 . . . . . . . . . . 14,928,054
--------------
146,278,884
--------------
CONSUMER FINANCE 16.9% 40,000,000 AT&T Capital Corp., 5.56%, 3/8/96 . . . . . . . . . . 39,584,444
36,500,000 American Express Credit Corp., 5.56%, 3/6/96 . . . . . 36,131,958
20,000,000 Ford Credit Receivables Funding Inc.,
5.63%, 2/7/96 . . . . . . . . . . . . . . . . . . . 19,881,775
50,000,000 Ford Credit Receivables Funding Inc.,
5.771%, 2/6/96 . . . . . . . . . . . . . . . . . . . 50,007,433
25,000,000 General Electric Capital Corp., 5.72%, 2/16/96 . . . . 24,814,609
25,000,000 General Electric Capital Corp., 5.54%, 3/1/96 . . . . 24,767,500
15,000,000 General Electric Capital Corp., 5.41%, 4/23/96 . . . . 14,747,300
35,000,000 Pitney Bowes Credit Corp., 5.5%, 2/1/96 . . . . . . . 34,829,715
--------------
244,764,734
--------------
OTHER FINANCIAL
COMPANIES 14.4% 20,000,000 American General Finance Corp., 5.7%, 1/16/96 . . . . 19,949,421
12,000,000 Associates Corp. of North America, 5.24%,
1/12/96 . . . . . . . . . . . . . . . . . . . . . 11,979,063
40,000,000 Corporate Asset Funding Corp., 5.467%, 1/22/96 . . . 39,867,000
12,000,000 Dresdner U.S. Finance Corp., 5.7%, 1/16/96 . . . . . 11,969,652
30,000,000 Pitney Bowes Credit Corp., 2.85%, 1/2/96 . . . . . . 29,995,250
25,000,000 Preferred Receivables Funding Corp., 5.67%,
1/25/96 . . . . . . . . . . . . . . . . . . . . . . 24,901,906
20,850,000 Preferred Receivables Funding Corp., 5.75%,
1/30/96 . . . . . . . . . . . . . . . . . . . . . . 20,750,614
17,500,000 Transamerica Finance Corp., 5.16%, 1/12/96 . . . . . 17,469,949
20,000,000 Transamerica Finance Corp., 5.45%, 6/7/96 . . . . . . 19,530,067
12,000,000 Transamerica Finance Corp., 5.45%, 6/10/96 . . . . . 11,712,720
--------------
208,125,642
--------------
TOTAL COMMERCIAL PAPER (Cost $799,692,871) . . . . . 799,705,453
--------------
1.8% U.S. TREASURY OBLIGATIONS
25,000,000 U.S. Treasury Note, 6%, 6/30/96
(Cost $25,026,875) . . . . . . . . . . . . . . . . 25,026,875
--------------
28.3% U.S. GOVERNMENT AGENCY OBLIGATIONS
25,000,000 Federal Home Loan Bank, 6.105%, 5/17/96 . . . . . . . 25,066,500
25,000,000 Federal Home Loan Bank, 5.88%, 6/14/96 . . . . . . . . 25,058,500
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
7
<PAGE>
SCUDDER CASH INVESTMENT TRUST
<TABLE>
<CAPTION>
% of Principal Value ($)
Portfolio Amount ($) (Note A)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
25,000,000 Federal National Mortgage Association,
6.48%, 3/27/96 . . . . . . . . . . . . . . . . . . 25,070,750
56,000,000 Federal National Mortgage Association,
5.26%, 7/14/99* . . . . . . . . . . . . . . . . . . 55,160,000
100,000,000 Student Loan Marketing Association, 5.27%,
4/16/96* . . . . . . . . . . . . . . . . . . . . . 100,145,000
50,000,000 Student Loan Marketing Association, 5.425%,
11/27/96* . . . . . . . . . . . . . . . . . . . . . 50,180,000
25,000,000 Student Loan Marketing Association 5.475%,
2/14/97* . . . . . . . . . . . . . . . . . . . . . . 25,028,750
50,000,000 Student Loan Marketing Association 5.4%,
10/30/97* . . . . . . . . . . . . . . . . . . . . . 50,024,500
54,000,000 Student Loan Marketing Association, 5.26%,
7/12/99* . . . . . . . . . . . . . . . . . . . . . 53,325,000
--------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $410,079,027) . . . . . . . . . . . . . . . . 409,059,000
--------------
11.7% MEDIUM-TERM AND SHORT-TERM NOTES
24,000,000 Advanta Credit Card, 5.87%, 11/30/98 24,000,000
5,000,000 Associates Corp. of North America, 6.875%,
1/15/97 . . . . . . . . . . . . . . . . . . . . . . 5,057,900
10,000,000 FCC National Bank Note, 5.46%, 3/28/96 . . . . . . . . 10,000,000
20,000,000 FCC National Bank Note, 5.8%, 10/10/96 . . . . . . . . 20,049,736
5,000,000 General Electric Capital Corp., 7.625%, 1/10/97 . . . . 5,110,550
25,000,000 National Bank of Detroit Note, 5.75%, 1/23/96 . . . . . 24,999,547
12,000,000 National Bank of Detroit Note, 5.85%, 6/5/96 . . . . . 12,016,080
10,000,000 Nationsbank of Texas, 5.55%, 11/8/96 . . . . . . . . . 10,008,793
50,000,000 U.S. National Bank of Oregon, 5.78%, 1/5/96 . . . . . . 49,999,997
8,000,000 Wachovia Corp., 6.3%, 7/15/96 . . . . . . . . . . . . 8,038,028
--------------
TOTAL MEDIUM-TERM AND SHORT-TERM NOTES
(Cost $169,196,549) . . . . . . . . . . . . . . . . 169,280,631
--------------
- ----------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT PORTFOLIO - 100.0%
(Cost $1,444,509,322) (a) . . . . . . . . . . . . . 1,443,585,959
--------------
--------------
</TABLE>
(a) The cost for federal income tax purposes was $1,444,509,322. At
December31, 1995, net unrealized depreciation for all securities based
on tax cost was $923,363. This consisted of aggregate gross unrealized
appreciation for all securities in which there was an excess of market
value over tax cost of $637,473 and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax
cost over market value of $1,560,836.
* Floating rate notes are securities whose yields vary with a designated
market index or market rate, such as the coupon-equivalent of the
Treasury bill rate. These securities are shown at their rate as of
December 31, 1995.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
8
<PAGE>
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
DECEMBER 31, 1995 (UNAUDITED)
- ---------------------------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at value (identified cost $1,444,509,322)
(Note A). . . . . . . . . . . . . . . . . . . . . . . $1,443,585,959
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,288,851
Receivables:
Fund shares sold. . . . . . . . . . . . . . . . . . . 7,097,739
Interest. . . . . . . . . . . . . . . . . . . . . . . 8,768,882
Other assets . . . . . . . . . . . . . . . . . . . . . . . 23,949
--------------
Total assets . . . . . . . . . . . . . . . . . . 1,462,765,380
LIABILITIES
Payables:
Investments purchased . . . . . . . . . . . . . . . . $15,222,566
Fund shares redeemed. . . . . . . . . . . . . . . . . 11,824,269
Dividends . . . . . . . . . . . . . . . . . . . . . . 320,021
Accrued management fee (Note B) . . . . . . . . . . . 515,732
Other accrued expenses (Note B) . . . . . . . . . . . 842,654
------------
Total liabilities . . . . . . . . . . . . . . . 28,725,242
--------------
Net assets, at value . . . . . . . . . . . . . . . . . . . $1,434,040,138
--------------
--------------
NET ASSETS
Net assets consist of:
Unrealized depreciation on investments . . . . . . . $ (923,363)
Shares of beneficial interest . . . . . . . . . . . . 14,347,177
Additional paid-in capital . . . . . . . . . . . . . 1,420,616,324
--------------
Net assets, at value . . . . . . . . . . . . . . . . . . $1,434,040,138
--------------
--------------
NET ASSET VALUE, offering and redemption price per
share ($1,434,040,138 divided by 1,434,717,736
outstanding shares of beneficial interest, $.01 par
value, unlimited number of shares authorized) . . . . $1.00
-----
-----
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
9
<PAGE>
SCUDDER CASH INVESTMENT TRUST
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED DECEMBER 31, 1995 (UNAUDITED)
- -------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME
Interest . . . . . . . . . . . . . . . . . . . $ 43,154,768
Expenses:
Management fee (Note B) . . . . . . . . . . . . $ 3,046,291
Services to shareholders (Note B) . . . . . . . 2,618,312
Trustees' fees (Note B) . . . . . . . . . . . 14,532
Custodian and accounting fees (Note B). . . . . 138,644
Reports to shareholders . . . . . . . . . . . . 205,934
State registration . . . . . . . . . . . . . . 44,628
Legal . . . . . . . . . . . . . . . . . . . . . 18,016
Auditing . . . . . . . . . . . . . . . . . . . 20,154
Other . . . . . . . . . . . . . . . . . . . . . 30,977 6,137,488
-------------------------
Net investment income . . . . . . . . . . . . . 37,017,280
------------
NET UNREALIZED GAIN ON INVESTMENT TRANSACTIONS
Net unrealized appreciation on investments
during the period . . . . . . . . . . . . 581,787
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 37,599,067
------------
------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
10
<PAGE>
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
DECEMBER 31, YEAR ENDED
1995 JUNE 30,
INCREASE (DECREASE) IN NET ASSETS (UNAUDITED) 1995
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations:
Net investment income. . . . . . . . . . . . . . . $ 37,017,280 $ 75,760,622
Net unrealized appreciation (depreciation)
on investment transactions during
the period. . . . . . . . . . . . . . . . . . 581,787 (1,328,106)
----------------- ---------------
Net increase in net assets resulting
from operations . . . . . . . . . . . . . . . 37,599,067 74,432,516
----------------- ---------------
Distributions to shareholders from net
investment income ($.025 and $.048
per share, respectively) . . . . . . . . . . (37,017,280) (75,760,622)
----------------- ----------------
Fund share transactions at net asset
value of $1.00 per share:
Shares sold . . . . . . . . . . . . . . . . . . . 846,654,209 3,872,417,037
Net asset value of shares issued to
shareholders in reinvestment of
distributions . . . . . . . . . . . . . . . . 34,562,516 70,361,737
Shares redeemed. . . . . . . . . . . . . . . . . . (968,030,352) (3,851,655,789)
----------------- ---------------
Net increase (decrease) in net assets from
Fund share transactions . . . . . . . . . . . (86,813,627) 91,122,985
-------------- ---------------
INCREASE (DECREASE) IN NET ASSETS . . . . . . . . (86,231,840) 89,794,879
Net assets at beginning of period . . . . . . . . 1,520,271,978 1,430,477,099
----------------- ---------------
NET ASSETS AT END OF PERIOD . . . . . . . . . . . $1,434,040,138 $ 1,520,271,978
----------------- ---------------
----------------- ---------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
11
<PAGE>
FINANCIAL HIGHLIGHTS
THE FOLLOWING TABLE INCLUDES SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT
EACH PERIOD AND OTHER PERFORMANCE INFORMATION DERIVED FROM THE FINANCIAL
STATEMENTS.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
DECEMBER 31, YEARS ENDED JUNE 30,
1995 -------------------------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
--------- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of
period . . . . . . . . . $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net investment
income . . . . . . . . . .025 .048 .027 .027 .047 .069 .080 .082 .064 .056 .071
Distributions from
net investment
income and
net realized
capital gains. . . . . . (.025) (.048) (.027) (.027) (.047) (.069) (.080) (.082) (.064) (.056) (.071)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net asset value,
end of period . . . . . $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
TOTAL RETURN (%) . . . . 2.53** 4.90 2.77 2.75 4.76 7.13 8.23 8.49 6.59 5.71 7.25
RATIOS AND
SUPPLEMENTAL
DATA
Net assets, end
of period
($ millions) . . . . . . 1,434 1,520 1,430 1,119 1,361 1,736 1,644 1,563 1,370 1,144 1,104
Ratio of operating
expenses to
average daily net
assets (%) . . . . . . . .83* .78 .82 .78 .70 .66 .67 .66 .68 .68 .65
Ratio of net
investment
income to
average daily
net assets (%) . . . . . 4.99* 4.84 2.78 2.72 4.58 6.91 7.93 8.21 6.44 5.55 7.01
* Annualized
** Not annualized
</TABLE>
12
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
A. SIGNIFICANT ACCOUNTING POLICIES
- -------------------------------------------------------------------------------
Scudder Cash Investment Trust (the "Fund") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940,
as amended, as a diversified, open-end management investment company. The
policies described below are followed consistently by the Fund in the
preparation of its financial statements in conformity with generally accepted
accounting principles.
SECURITY VALUATION. Portfolio securities which have remaining maturities of
sixty days or less are valued by the amortized cost method permitted in
accordance with Rule 2a-7 under the Investment Company Act of 1940. Portfolio
securities for which market quotations are readily available and which have
remaining maturities of sixty-one days or more from the date of valuation are
valued at the calculated mean between the over-the-counter bid and asked prices,
using quotations supplied by independent registered broker/dealers. On the
sixtieth day prior to maturity and thereafter until maturity, securities
originally purchased with more than sixty days remaining to maturity are valued
at amortized cost calculated daily, based upon the market valuation of the
securities on the sixty-first day prior to maturity. Other securities are
appraised at fair value as determined in good faith by or on behalf of the
Trustees of the Fund. Repurchase agreements are valued at identified cost which,
when combined with accrued interest receivable, approximates market.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian,
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, depending on the maturity of the repurchase
agreement and the underlying collateral, is equal to at least 100.5% of the
resale price.
FEDERAL INCOME TAXES. The Fund's policy is to comply with the requirements
of the Internal Revenue Code which are applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders. The
Fund accordingly paid no federal income taxes and no provision for federal
income taxes was required.
DISTRIBUTION OF INCOME AND GAINS. All of the net investment income of the Fund
is declared as a dividend to shareholders of record as of
13
<PAGE>
SCUDDER CASH INVESTMENT TRUST
twelve o'clock noon on each business day and is paid to shareholders monthly.
During any particular year, net realized gains from investment transactions,
in excess of available capital loss carryforwards, would be taxable to the
Fund if not distributed and, therefore, will be distributed to the shareholders.
An additional distribution may be made to the extent necessary to avoid the
payment of a four percent federal excise tax.
The Fund uses the specific identification method for determining realized gain
or loss on investments for both financial and federal income tax reporting
purposes.
OTHER. Investment transactions are accounted for on a trade-date basis (which
in most instances is the same as the settlement date). Interest income is
accrued pro rata to maturity. All premiums and discounts are amortized/accreted
for both tax and financial reporting purposes.
B. RELATED PARTIES
Under the Fund's Investment Advisory Agreement (the "Agreement") with Scudder
Stevens & Clark, Inc. (the "Adviser"), the Fund agrees to pay the Adviser a
fee equal to an annual rate of 0.50% of the first $250,000,000 of the Fund's
average daily net assets, 0.45% of the next $250,000,000 of such net assets,
0.40% of the next $500,000,000 of such net assets and 0.35% of such net assets
in excess of $1,000,000,000, computed and accrued daily and payable monthly.
As manager of the assets of the Fund, the Adviser directs the investments of
the Fund in accordance with its investment objectives, policies, and
restrictions. The Adviser determines the securities, instruments, and other
contracts relating to investments to be purchased, sold or entered into by the
Fund. In addition to portfolio management services, the Adviser provides certain
administrative services in accordance with the Management Agreement. The
Agreement also provides that if the Fund's expenses, exclusive of taxes,
interest and extraordinary expenses, exceed specified limits, such excess, up to
the amount of the management fee, will be paid by the Adviser. For the six
months ended December 31, 1995, the fee pursuant to the Agreement amounted to
$3,046,291 which was equivalent to an annual effective rate of 0.41% of the
Fund's average daily net assets.
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Scudder Service Corporation ("SSC"), a subsidiary of the Adviser, is the
transfer, dividend paying and shareholder service agent for the Fund. For the
six months ended December 31, 1995, the amount charged to the Fund by SSC
aggregated $2,139,494, of which $563,398 is unpaid at December 31, 1995.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Adviser,
is responsible for determining the daily net asset value per share and
maintaining the portfolio and general accounting records of the Fund. For the
six months ended December 31, 1995, the amount charged to the Fund by SFAC
aggregated $52,796, of which $8,658 is unpaid at December 31, 1995.
The Fund pays each Trustee not affiliated with the Adviser $4,000 annually
plus specified amounts for attended board and committee meetings. For the six
months ended December 31, 1995, Trustees' fees aggregated $14,532.
15
<PAGE>
SCUDDER CASH INVESTMENT TRUST
TAX INFORMATION
By now shareholders for whom year-end tax reporting is required by the IRS
should have received their Form 1099-DIV and tax information letter from the
Fund. For corporate shareholders no amount of the income dividends paid by
the Fund qualified for the dividends received deduction.
In many states the amount of income distributed to you by the Fund which is
derived from obligations of the U.S. Government may be exempt from state and
local income taxes. Of the income dividends paid by the Fund for its calendar
year ended December 31, 1994, 1.04% was derived from direct obligations of
the U.S. Government, 19.88% from the Student Loan Marketing Association, and
1.60% from Federal Home Loan Bank.
Please consult a tax adviser if you have questions about federal or state income
tax laws, or on how to prepare your tax returns. If you have specific questions
about your Scudder Fund account, please call a Scudder Investor Relations
Representative at 1-800-225-5163.
16
<PAGE>
OFFICERS AND TRUSTEES
David S. Lee*
President and Trustee
Cuyler W. Findlay*
Vice President and Trustee
Dudley H. Ladd*
Vice President and Trustee
Henry P. Becton, Jr.
Trustee; President and
General Manager, WGBH
Educational Foundation
Dawn-Marie Driscoll
Trustee; Attorney and
Corporate Director
Peter B. Freeman
Trustee; Corporate
Director and Trustee
George M. Lovejoy, Jr.
Trustee; President and
Director, Fifty Associates
Stephen L. Akers*
Vice President
Jerard K. Hartman*
Vice President
Thomas W. Joseph*
Vice President
Thomas F. McDonough*
Vice President and Secretary
Pamela A. McGrath*
Vice President and Treasurer
Robert T. Neff*
Vice President
Edward J. O'Connell*
Vice President and Assistant Treasurer
Coleen Downs Dinneen*
Assistant Secretary
*Scudder, Stevens & Clark, Inc.
17
<PAGE>
INVESTMENT PRODUCTS AND SERVICES
The Scudder Family of Funds
<TABLE>
<S> <C>
-----------------------------------------------------------------------------------------------------------------
Money Market Income
Scudder Cash Investment Trust Scudder Emerging Markets Income Fund
Scudder U.S. Treasury Money Fund Scudder Global Bond Fund
Tax Free Money Market+ Scudder GNMA Fund
Scudder Tax Free Money Fund Scudder Income Fund
Scudder California Tax Free Money Fund* Scudder International Bond Fund
Scudder New York Tax Free Money Fund* Scudder Short Term Bond Fund
Tax Free+ Scudder Zero Coupon 2000 Fund
Scudder California Tax Free Fund* Growth
Scudder High Yield Tax Free Fund Scudder Capital Growth Fund
Scudder Limited Term Tax Free Fund Scudder Development Fund
Scudder Managed Municipal Bonds Scudder Global Fund
Scudder Massachusetts Limited Term Tax Free Fund* Scudder Global Small Company Fund
Scudder Massachusetts Tax Free Fund* Scudder Gold Fund
Scudder Medium Term Tax Free Fund Scudder Greater Europe Growth Fund
Scudder New York Tax Free Fund* Scudder International Fund
Scudder Ohio Tax Free Fund* Scudder Latin America Fund
Scudder Pennsylvania Tax Free Fund* Scudder Pacific Opportunities Fund
Growth and Income Scudder Quality Growth Fund
Scudder Balanced Fund Scudder Small Company Value Fund
Scudder Growth and Income Fund Scudder Value Fund
The Japan Fund
Retirement Plans and Tax-Advantaged Investments
-----------------------------------------------------------------------------------------------------------------
IRAs 403(b) Plans
Keogh Plans SEP-IRAs
Scudder Horizon Plan+++* (a variable annuity) Profit Sharing and Money Purchase
401(k) Plans Pension Plans
Closed-End Funds#
-----------------------------------------------------------------------------------------------------------------
The Argentina Fund, Inc. The Latin America Dollar Income Fund, Inc.
The Brazil Fund, Inc. Montgomery Street Income Securities, Inc.
The First Iberian Fund, Inc. Scudder New Asia Fund, Inc.
The Korea Fund, Inc. Scudder New Europe Fund, Inc.
Scudder World Income
Opportunities Fund, Inc.
Institutional Cash Management
-----------------------------------------------------------------------------------------------------------------
Scudder Institutional Fund, Inc. Scudder Treasurers Trust(TM)++
Scudder Fund, Inc.
-----------------------------------------------------------------------------------------------------------------
</TABLE>
For complete information on any of the above Scudder funds, including
management fees and expenses, call or write for a free prospectus. Read it
carefully before you invest or send money. +A portion of the income from the
tax-free funds may be subject to federal, state, and local taxes. *Not
available in all states. +++A no-load variable annuity contract provided by
Charter National Life Insurance Company and its affiliate, offered by
Scudder's insurance agencies, 1-800-225-2470. #These funds, advised by
Scudder, Stevens & Clark, Inc. are traded on various stock exchanges. ++For
information on Scudder Treasurers Trust,(TM) an institutional cash
management service that utilizes certain portfolios of Scudder Fund, Inc.
($100,000 minimum), call 1-800-541-7703.
18
<PAGE>
HOW TO CONTACT SCUDDER
<TABLE>
<S> <C>
Account Service and Information
-------------------------------------------------------------------------------------------------------------
For existing account service and transactions
SCUDDER INVESTOR RELATIONS
1-800-225-5163
For personalized information about your
Scudder accounts; exchanges and
redemptions; or information on any Scudder fund
SCUDDER AUTOMATED INFORMATION LINE (SAIL)
1-800-343-2890
Investment Information
-------------------------------------------------------------------------------------------------------------
To receive information about the Scudder funds, for additional
applications and prospectuses, or for investment questions
SCUDDER INVESTOR RELATIONS
1-800-225-2470
For establishing 401(k) and 403(b) plans
SCUDDER DEFINED CONTRIBUTION SERVICES
1-800-323-6105
Please address all correspondence to
-------------------------------------------------------------------------------------------------------------
THE SCUDDER FUNDS
P.O. BOX 2291
BOSTON, MASSACHUSETTS
02107-2291
Or stop by a Scudder Funds Center
-------------------------------------------------------------------------------------------------------------
Many shareholders enjoy the personal,
one-on-one service of the Scudder Funds
Centers. Check for a Funds Center near
you--they can be found in the following
cities:
Boca Raton New York
Boston Portland, OR
Chicago San Diego
Cincinnati San Francisco
Los Angeles Scottsdale
-------------------------------------------------------------------------------------------------------------
For information on Scudder Trea- For information on Scudder
surers Trust,(TM) an institutional Institutional Funds,* funds
cash management service for designed to meet the broad
corporations, non-profit organiza- investment management
tions and trusts that uses certain and service needs of banks
portfolios of Scudder Fund, Inc.* and other institutions, call
($100,000 minimum), call 1-800-854-8525.
1-800-541-7703.
-------------------------------------------------------------------------------------------------------------
</TABLE>
Scudder Investor Relations and Scudder Funds Centers are services provided
through Scudder Investor Services, Inc., Distributor.
* Contact Scudder Investor Services, Inc., Distributor, to receive a
prospectus with more complete information, including management fees and
expenses. Please read it carefully before you invest or send money.
19
<PAGE>
Celebrating Over 75 Years of Serving Investors
- -------------------------------------------------------------------------------
Established in 1919 by Theodore Scudder, Sidney Stevens, and F. Haven Clark,
Scudder, Stevens & Clark was the first independent investment counsel firm in
the United States. Since its birth, Scudder's pioneering spirit and commitment
to professional long-term investment management have helped shape the investment
industry. In 1928, we introduced the nation's first no-load mutual fund. Today
we offer 37 pure no load(TM) funds, including the first international mutual
fund offered to U.S. investors.
Over the years, Scudder's global investment perspective and dedication to
research and fundamental investment disciplines have helped us become one of the
largest and most respected investment managers in the world. Though times have
changed since our beginnings, we remain committed to our long-standing
principles: managing money with integrity and distinction; keeping the interests
of our clients first; providing access to investments and markets that may not
be easily available to individuals; and making investing as simple and
convenient as possible through friendly, comprehensive service.
