<PAGE>
- --------------------------------------------------------------------------------
- --------- CHAIRMAN'S LETTER
February 6, 1997
DEAR SHAREHOLDER:
We are pleased to provide you with the 1996 annual report for the BNY
Hamilton Money Fund. At year-end, total assets in the Fund exceeded $1 billion.
The BNY Hamilton Money Fund continues to meet its investment objectives of
providing high current income, preservation of capital and maintenance of
liquidity. At year-end, the 7-day current yield for the Hamilton Shares of the
Fund was 5.84%. The full year return for the Hamilton Shares was 5.30%. For the
Premier Shares, the 7-day current yield at year-end was 5.57% and the full year
return was 5.03%. For the Classic Shares, the 7-day current yield was 5.16% and
the full year return was 4.73%.
U.S. Government and Agency securities and overnight repurchase agreements
collateralized by these securities represented 47% of the Fund's assets at
year-end and top-rated commercial paper comprised an additional 37%. The average
maturity of the Fund was 49 days.*
The BNY Hamilton Money Fund maintains a 'AAAm' rating by Standard and
Poor's, which signifies that the Fund's safety is excellent and that it has a
superior capacity to maintain its $1.00 net asset value per share.
We wish to thank all BNY Hamilton Money Fund shareholders for the
confidence they have placed in us.
Sincerely,
/s/ Edward L. Gardner
Edward L. Gardner
Chairman of the Board
BNY Hamilton Funds, Inc.
- ------------------
* An investment in the Fund is neither insured nor guaranteed by the U.S.
Government. Yields will fluctuate with market conditions. Past performance is
no guarantee of future results. There can be no assurance that the Fund will
be able to maintain a stable net asset value of $1.00 per share. Portfolio
composition is subject to change.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------- TABLE OF CONTENTS
SCHEDULE OF INVESTMENTS...................... Page 1
STATEMENT OF ASSETS AND LIABILITIES.......... 5
STATEMENT OF OPERATIONS...................... 5
STATEMENTS OF CHANGES IN NET ASSETS.......... 6
FINANCIAL HIGHLIGHTS......................... 7
NOTES TO FINANCIAL STATEMENTS................ 9
REPORT OF INDEPENDENT ACCOUNTANTS............ 11
DIRECTORS AND OFFICERS....................... 12
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON MONEY FUND
Schedule of Investments
DECEMBER 31, 1996
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
- ----------- --------------
COMMERCIAL PAPER--37.10%
ASSET BACKED SECURITIES--CREDIT CARDS--0.91%
$10,000,000 Riverwoods Funding Corp., 5.27%+, 2/12/97......... $ 9,938,517
--------------
BANK HOLDING COMPANIES--3.66%
20,000,000 J.P. Morgan & Co., 5.26%+, 3/5/97................. 19,815,900
20,000,000 National Australia Funding (DE), 5.38%+, 2/3/97... 19,901,367
--------------
39,717,267
--------------
BANKS--FOREIGN INSTITUTIONS--1.81%
20,000,000 Dresdner U.S. Finance Inc., 5.31%+, 4/10/97....... 19,707,950
--------------
BROKERAGE SERVICES--7.77%
15,000,000 CS First Boston, 5.33%+, 1/30/97.................. 14,935,596
15,000,000 CS First Boston, 5.35%+, 2/26/97.................. 14,875,167
10,000,000 Merrill Lynch & Co., Inc., 5.31%+, 3/4/97......... 9,908,550
25,000,000 Morgan Stanley Group, Inc., 5.34%+, 3/10/97....... 24,747,833
20,000,000 Smith Barney, 5.32%+, 1/17/97..................... 19,952,711
--------------
84,419,857
--------------
ELECTRICAL & ELECTRONIC EQUIPMENT--2.29%
25,000,000 Electricite de France, 5.30%+, 1/27/97............ 24,904,306
--------------
EQUIPMENT LEASING--3.84%
30,000,000 Budget Funding Corp., 5.32%+, 3/3/97.............. 29,729,567
12,000,000 National Fleet Funding Corp., 5.31%+, 1/6/97...... 11,991,150
--------------
41,720,717
--------------
FINANCE COMPANIES--CAPTIVE--3.76%
$25,000,000 Bell Atlantic Network Funding, 5.31%+, 1/22/97.... $ 24,922,562
16,000,000 MetLife Funding Inc., 5.30%+, 1/13/97............. 15,971,733
--------------
40,894,295
--------------
FINANCE COMPANIES--NON-CAPTIVE & INDEPENDENT--0.90%
10,000,000 General Electric Capital Corp., 5.32%+, 6/6/97.... 9,769,466
--------------
FOREIGN GOVERNMENTS & RELATED ISSUES--AUSTRALIA--1.84%
10,000,000 Tasmanian Public Finance Corp., 5.31%+, 1/24/97... 9,966,075
10,000,000 Wool International, 5.31%+, 1/13/97............... 9,982,300
--------------
19,948,375
--------------
FOREIGN GOVERNMENTS & RELATED ISSUES--CANADA--1.83%
20,000,000 Canadian Wheat Board, 5.34%+, 2/5/97.............. 19,896,167
--------------
FOREIGN GOVERNMENTS & RELATED ISSUES--FRANCE--1.37%
15,000,000 Caisse D'Amortissement De La Dette, 5.42%+,
2/28/97........................................... 14,869,017
--------------
INSURANCE--1.83%
20,000,000 General Re Corp., 5.30%+, 2/4/97.................. 19,899,889
--------------
NON-BANK HOLDING COMPANIES--1.38%
15,000,000 USAA Capital Corp., 5.28%+, 1/23/97............... 14,951,600
--------------
See notes to financial statements.
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1
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON MONEY FUND
Schedule of Investments (continued)
DECEMBER 31, 1996
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
- ----------- --------------
COMMERCIAL PAPER (CONTINUED)
TELECOMMUNICATIONS--NON-U.S.--1.83%
$20,000,000 France Telecom, 5.29%+, 2/20/97................... $ 19,853,055
--------------
UTILITIES--GAS & PIPELINE--2.08%
12,100,000 Northern Illinois Gas Co., 5.33%+, 1/14/97........ 12,076,886
10,600,000 Northern Illinois Gas Co., 5.33%+, 1/21/97........ 10,568,612
--------------
22,645,498
--------------
TOTAL COMMERCIAL PAPER (Cost $403,135,976)........ 403,135,976
--------------
UNITED STATES GOVERNMENT AGENCIES & OBLIGATIONS--17.07%
UNITED STATES GOVERNMENT AGENCY SECURITIES--13.30%
Federal Farm Credit Bank,
10,000,000 5.40%, 4/1/97..................................... 9,997,164
12,000,000 5.85%, 10/1/97.................................... 12,005,178
Federal Home Loan Bank,
14,000,000 5.04%, 2/28/97.................................... 13,997,408
5,000,000 5.325%, 3/18/97................................... 4,997,802
5,000,000 5.615%, 4/17/97................................... 4,999,612
5,300,000 5.61%, 12/18/97................................... 5,299,490
Federal Home Loan Mortgage Corporation,
4,040,000 4.96%, 2/3/97..................................... 4,039,397
10,000,000 5.29%+, 7/18/97................................... 9,709,050
Federal National Mortgage Association,
10,000,000 5.07%, 1/23/97.................................... 9,999,812
10,000,000 4.82%, 2/10/97.................................... 9,999,364
12,000,000 4.97%, 3/10/97.................................... 11,995,481
20,000,000 5.48%, 4/24/97.................................... 19,995,163
12,000,000 5.17%+, 6/11/97................................... 11,722,543
6,000,000 5.32%+, 10/2/97................................... 5,757,053
Student Loan Marketing Association,
10,000,000 5.615%, 10/29/97.................................. 9,994,322
--------------
144,508,839
--------------
UNITED STATES TREASURY NOTES--3.77%
$ 9,000,000 6.875%, 2/28/97................................... $ 9,020,083
9,000,000 6.75%, 5/31/97.................................... 9,033,620
15,000,000 5.625%, 6/30/97................................... 14,989,915
8,000,000 5.625%, 8/31/97................................... 7,985,240
--------------
41,028,858
--------------
TOTAL UNITED STATES GOVERNMENT AGENCIES &
OBLIGATIONS (Cost $185,537,697)................... 185,537,697
--------------
TIME DEPOSITS--7.00%
BANK HOLDING COMPANIES--3.32%
36,043,000 Wachovia Bank of North Carolina, 7.50%, 1/2/97.... 36,043,000
--------------
BANKS--FOREIGN INSTITUTIONS--3.68%
40,000,000 Societe Generale, 7.75%, 1/2/97................... 40,000,000
--------------
TOTAL TIME DEPOSITS (Cost $76,043,000)............ 76,043,000
--------------
FLOATING RATE NOTES--5.89%
BANK HOLDING COMPANIES--1.84%
20,000,000 Boatmens National Bank of St. Louis, 5.35%+,
payable quarterly, interest rate resets weekly,
next interest rate reset date 1/7/97, final
maturity 6/17/97.................................. 20,000,000
--------------
BROKERAGE SERVICES--4.05%
12,000,000 Bear Stearns Companies, Inc., 5.64765%+, payable
monthly, interest rate resets monthly, next
interest rate reset date 1/13/97, final maturity
6/13/97........................................... 12,000,000
See notes to financial statements.
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2
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON MONEY FUND
Schedule of Investments (continued)
DECEMBER 31, 1996
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
- ----------- --------------
FLOATING RATE NOTES (CONTINUED)
$15,000,000 Bear Stearns Companies, Inc., 5.5925%+, payable
quarterly, interest rate resets monthly, next
interest rate reset date 1/3/97, final maturity
10/3/97........................................... $ 15,000,000
17,000,000 Merrill Lynch & Co., Inc., 5.59546%+, payable
monthly, interest rate resets monthly, next
interest rate reset date 1/16/97, final maturity
5/27/97........................................... 17,000,000
--------------
44,000,000
--------------
TOTAL FLOATING RATE NOTES (Cost $64,000,000)...... 64,000,000
--------------
FIXED RATE DEBT OBLIGATIONS--2.79%
BANK HOLDING COMPANIES--2.02%
12,000,000 FCC National Bank, 5.70%, 10/30/97................ 12,009,110
10,000,000 Northern Trust Co., 5.65%, 10/9/97 9,992,218
--------------
22,001,328
--------------
UTILITIES--ELECTRIC--0.77%
8,300,000 Wisconsin Electric Power Co., 5.875%, 10/1/97..... 8,313,361
--------------
TOTAL FIXED RATE DEBT OBLIGATIONS (Cost
$30,314,689)...................................... 30,314,689
--------------
CERTIFICATE OF DEPOSIT--FOREIGN INSTITUTIONS--0.74%
8,000,000 ABN AMRO Bank, 5.53%, 3/18/97 (Cost $8,000,320)... 8,000,320
--------------
REPURCHASE AGREEMENTS--29.44%
REPURCHASE AGREEMENTS WITH BARCLAYS DEZOETE WEDD--7.36%
$80,000,000 7.01%, due 1/2/97, repurchase price $80,031,156
(Collateral--Federal Home Loan Mortgage
Corporation Bonds, 6.00%-9.00%, 11/15/06-5/1/26;
Federal National Mortgage Association Bonds,
6.00%-7.00%, 7/25/99-6/1/26; aggregate market
value plus accrued interest $82,094,627) (Cost
$80,000,000)...................................... $ 80,000,000
--------------
REPURCHASE AGREEMENTS WITH DEAN WITTER REYNOLDS, INC.--7.36%
80,000,000 7.00%, due 1/2/97, repurchase price $80,031,111
(Collateral--Federal Home Loan Mortgage
Corporation Notes/Bonds, 6.3375%-8.50%,
9/1/98-3/15/24; Federal National Mortgage
Association Bonds, 5.70%-7.00%, 10/25/07-1/1/33;
aggregate market value plus accrued interest
$82,400,001) (Cost $80,000,000)................... 80,000,000
--------------
See notes to financial statements.
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
- --------- BNY HAMILTON MONEY FUND
Schedule of Investments (continued)
DECEMBER 31, 1996
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
- ----------- --------------
REPURCHASE AGREEMENTS (CONTINUED)
REPURCHASE AGREEMENTS WITH DEUTSCHE BANK AG--7.36%
$80,000,000 6.95%, due 1/2/97, repurchase price $80,030,889
(Collateral--Federal Home Loan Mortgage
Corporation Bonds, 5.839%-6.239%, 1/15/09-5/15/23;
Federal National Mortgage Association Bond, 6.00%,
12/25/24; aggregate market value plus accrued
interest $82,400,000) (Cost $80,000,000).......... $ 80,000,000
--------------
REPURCHASE AGREEMENTS WITH MORGAN STANLEY GROUP, INC.--7.36%
80,000,000 7.00%, due 1/2/97, repurchase price $80,031,111
(Collateral--Federal Home Loan Mortgage
Corporation Bond, 9.00%, 1/1/25; Federal National
Mortgage Association Bonds, 6.00%-9.00%,
5/1/08-9/1/26; aggregate market value plus accrued
interest $81,720,216) (Cost $80,000,000).......... 80,000,000
--------------
TOTAL REPURCHASE AGREEMENTS (Cost $320,000,000)... $ 320,000,000
--------------
TOTAL INVESTMENTS--
(Cost $1,087,031,682)(a)--100.03%................. 1,087,031,682
Other assets less liabilities--(0.03%)............ (370,804)
--------------
NET ASSETS--100%.................................. $1,086,660,878
--------------
--------------
(a) The cost stated also represents the aggregate cost for Federal income tax
purposes.
+ Represents yield at time of purchase for Commercial Paper, discounted rate
at time of purchase for United States Government Agencies & Obligations,
and interest rate in effect at December 31, 1996 for Floating Rate Notes.
See notes to financial statements.
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4
<PAGE>
- --------------------------------------------------------------------------------
- --------- Statement of Assets and Liabilities
DECEMBER 31, 1996
- --------------------------------------------------------------------------------
ASSETS:
Investments at market value, including repurchase agreements
of $320,000,000 (Identified cost $1,087,031,682)........... $1,087,031,682
Cash......................................................... 1,644
Interest receivable.......................................... 3,459,916
Deferred organization costs and other assets................. 68,681
--------------
TOTAL ASSETS.............................................. 1,090,561,923
--------------
LIABILITIES:
Dividends payable: Hamilton Shares........................... 2,576,543
Hamilton Premier Shares................... 879,007
Hamilton Classic Shares................... 149
Services provided by The Bank of New York and Administrator.. 358,117
Accrued expenses and other liabilities....................... 87,229
--------------
TOTAL LIABILITIES......................................... 3,901,045
--------------
NET ASSETS:
(applicable to 1,086,660,878 shares issued and outstanding;
9 billion shares of $.001 par value authorized)........... $1,086,660,878
--------------
--------------
SOURCES OF NET ASSETS:
Capital stock @ par.......................................... $ 1,086,661
Capital surplus.............................................. 1,085,574,217
--------------
NET ASSETS..................................................... $1,086,660,878
--------------
--------------
HAMILTON SHARES:
Net asset value, offering price and redemption price per
share ($609,424,033/609,424,033 shares)................... $ 1.00
--------------
--------------
HAMILTON PREMIER SHARES:
Net asset value, offering price and redemption price per
share ($463,758,450/463,758,450 shares)................... $ 1.00
--------------
--------------
HAMILTON CLASSIC SHARES:
Net asset value, offering price and redemption price per
share ($13,478,395/13,478,395 shares)..................... $ 1.00
--------------
--------------
- --------------------------------------------------------------------------------
- --------- Statement of Operations
FOR THE YEAR ENDED DECEMBER 31, 1996
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Interest........................................................ $61,225,393
-----------
EXPENSES:
Advisory........................................................ 1,128,699
Administration.................................................. 1,128,699
12b-1 fee--Hamilton Classic Shares.............................. 33,028
Servicing fee: Hamilton Premier Shares.......................... 1,060,118
Hamilton Classic Shares.......................... 33,028
Accounting services............................................. 60,000
Cash management: Hamilton Shares................................ 8,714
Hamilton Premier Shares........................ 29,896
Hamilton Classic Shares........................ 400
Custodian....................................................... 152,738
Transfer agent: Hamilton Shares................................. 17,928
Hamilton Premier Shares......................... 33,941
Hamilton Classic Shares......................... 4,410
Audit........................................................... 49,914
Insurance....................................................... 32,570
Directors'...................................................... 17,954
Reports to shareholders......................................... 27,089
Registration and filing......................................... 231,844
Legal........................................................... 63,382
Other........................................................... 70,428
-----------
TOTAL EXPENSES............................................... 4,184,780
-----------
NET INVESTMENT INCOME........................................ $57,040,613
-----------
-----------
See notes to financial statements.
- --------------------------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
- --------- Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------------
1996 1995
--------------- ---------------
OPERATIONS:
Net investment income....................... $ 57,040,613 $ 37,796,901
--------------- ---------------
Net increase in net assets resulting from
operations................................. 57,040,613 37,796,901
--------------- ---------------
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment
income: Hamilton Shares.................... (35,659,908) (24,629,959)
Hamilton Premier Shares............ (20,772,078) (13,159,984)
Hamilton Classic Shares............ (608,627) (6,958)
--------------- ---------------
(57,040,613) (37,796,901)
--------------- ---------------
CAPITAL STOCK TRANSACTIONS:
Proceeds from capital stock
sold: Hamilton Shares...................... 2,408,255,035 2,243,841,012
Hamilton Premier Shares.............. 4,388,644,318 2,810,413,019
Hamilton Classic Shares.............. 28,058,002 3,150,632
Proceeds from shares issued on reinvestment
of dividends: Hamilton Shares.............. 4,380,461 3,388,955
Hamilton Premier Shares...... 11,294,784 7,918,171
Hamilton Classic Shares...... 599,324 6,393
Cost of capital stock
repurchased: Hamilton Shares............... (2,407,263,969) (1,878,397,366)
Hamilton Premier Shares....... (4,276,343,748) (2,585,966,924)
Hamilton Classic Shares....... (18,277,323) (58,633)
--------------- ---------------
Increase in net assets resulting from
capital stock transactions.............. 139,346,884 604,295,259
--------------- ---------------
INCREASE IN NET ASSETS................. 139,346,884 604,295,259
NET ASSETS:
Beginning of year........................... 947,313,994 343,018,735
--------------- ---------------
End of year................................. $ 1,086,660,878 $ 947,313,994
--------------- ---------------
--------------- ---------------
CHANGES IN CAPITAL STOCK OUTSTANDING:
Shares sold: Hamilton Shares................ 2,408,255,035 2,243,841,012
Hamilton Premier Shares........ 4,388,644,318 2,810,413,019
Hamilton Classic Shares........ 28,058,002 3,150,632
Shares issued on reinvestment of
dividends: Hamilton Shares................. 4,380,461 3,388,955
Hamilton Premier Shares......... 11,294,784 7,918,171
Hamilton Classic Shares......... 599,324 6,393
Shares repurchased: Hamilton Shares......... (2,407,263,969) (1,878,397,366)
Hamilton Premier Shares (4,276,343,748) (2,585,966,924)
Hamilton Classic Shares (18,277,323) (58,633)
--------------- ---------------
Net increase............................. 139,346,884 604,295,259
Shares outstanding, beginning of year....... 947,313,994 343,018,735
--------------- ---------------
Shares outstanding, end of year............. 1,086,660,878 947,313,994
--------------- ---------------
--------------- ---------------
See notes to financial statements.
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6
<PAGE>
- --------------------------------------------------------------------------------
- --------- Financial Highlights
- --------------------------------------------------------------------------------
HAMILTON SHARES
---------------------------------------------------
FOR THE
PERIOD
AUGUST 7,
1992*
YEAR ENDED DECEMBER 31, THROUGH
-------------------------------------- DECEMBER 31,
1996 1995 1994 1993 1992
-------- -------- -------- -------- ------------
PER SHARE DATA:
Net asset value at
beginning of period..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -----------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.052 0.057 0.040 0.030 0.012
-------- -------- -------- -------- -----------
DIVIDENDS
Dividends from net
investment income....... (0.052) (0.057) (0.040) (0.030) (0.012)
-------- -------- -------- -------- -----------
Net asset value at end of
period.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -----------
-------- -------- -------- -------- -----------
TOTAL RETURN:............ 5.30% 5.84% 4.02% 3.03% 1.26%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end of
period (000's omitted).. $609,424 $604,053 $235,220 $307,395 $135,852
Ratio to average net
assets of:
Expenses, net of waiver
from The Bank of New
York.................. 0.27% 0.26% 0.30% 0.27% 0.20%***
Expenses, prior to
waiver from The Bank
of New York........... 0.27% 0.26% 0.32% 0.32% 0.49%***
Net investment income,
net of waiver from
The Bank of New York.. 5.17% 5.67% 3.92% 2.97% 3.11%***
* Commencement of investment operations.
** Not annualized.
*** Annualized.
See notes to financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
- --------------------------------------------------------------------------------
- --------- Financial Highlights (continued)
- --------------------------------------------------------------------------------
HAMILTON PREMIER SHARES HAMILTON CLASSIC SHARES
-------------------------------- --------------------------
FOR THE FOR THE
PERIOD PERIOD
AUGUST 15, DECEMBER 4,
YEAR ENDED 1994* 1995*
DECEMBER 31, THROUGH YEAR ENDED THROUGH
------------------ DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1995 1994 1996 1995
-------- -------- ------------ ------------ ------------
PER SHARE DATA:
Net asset value
at beginning of
period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ----------- ----------- -----------
INCOME FROM IN-
VESTMENT OPERATIONS
Net investment
income.......... 0.049 0.054 0.017 0.046 0.004
-------- -------- ----------- ----------- -----------
DIVIDENDS
Dividends from
net investment
income.......... (0.049) (0.054) (0.017) (0.046) (0.004)
-------- -------- ----------- ----------- -----------
Net asset value
at end of
period.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ----------- ----------- -----------
-------- -------- ----------- ----------- -----------
TOTAL RETURN:.... 5.03% 5.54% 1.69%** 4.73% 0.40%**
RATIOS/SUPPLEMENTAL DATA:
Net assets at end
of period (000's
omitted)........ $463,759 $340,163 $107,799 $ 13,478 $ 3,098
Ratio to average
net assets of:
Expenses....... 0.53% 0.54% 0.61%*** 0.82% 0.76%***
Net investment
income........ 4.91% 5.40% 4.40%*** 4.67% 5.18%***
* Commencement of investment operations for the respective class of shares.
** Not annualized.
*** Annualized.
See notes to financial statements.
- --------------------------------------------------------------------------------
8
<PAGE>
- --------------------------------------------------------------------------------
- --------- Notes to Financial Statements
1. ORGANIZATION AND BUSINESS
The BNY Hamilton Funds, Inc. (the 'Company') was organized as a Maryland
Corporation on May 1, 1992 and is registered under the Investment Company Act of
1940 as an open-end management investment company. The Company currently
consists of four series. The BNY Hamilton Money Fund (the 'Fund') commenced
investment operations on August 7, 1992. The Fund consists of three classes of
shares: Hamilton Shares, Hamilton Premier Shares, and Hamilton Classic Shares.
2. SIGNIFICANT ACCOUNTING POLICIES
(A) SECURITY VALUATIONS
Securities are valued at amortized cost which approximates market value. This
method values a security at its cost at the time of purchase and thereafter
assumes a constant rate of amortization to maturity of any discount or premium.
(B) REPURCHASE AGREEMENTS
The Fund's custodian or designated sub-custodians, as the case may be under
tri-party repurchase agreements, takes possession of the collateral pledged for
investments in repurchase agreements. The underlying collateral is valued daily
on a mark-to-market basis to ensure that the value, including accrued interest,
is at least equal to the repurchase price. In the event of default of the
obligation to repurchase, the Fund has the right to liquidate the collateral and
apply the proceeds in satisfaction of the obligations. Under certain
circumstances, in the event of default or bankruptcy by the other party to the
agreement, realization and/or retention of the collateral may be subject to
legal proceedings.
(C) FEDERAL INCOME TAXES
The Fund is treated as a separate entity for federal income tax purposes. The
Fund's policy is to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and distribute income to
shareholders within the allowable time limits. Therefore, no federal income tax
provision is required.
(D) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income is declared daily and paid monthly.
(E) SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are recorded on the trade date and interest income is
accrued daily. Discounts and premiums on securities purchased are amortized over
the life of the respective securities.
Income, expenses (other than class specific expenses) and realized gains and
losses, if any, are allocated to each class of shares based upon their relative
shares outstanding.
(F) ORGANIZATION COSTS
Costs incurred in connection with the organization and initial registration
of the Fund are being amortized evenly over the period of benefit not to exceed
60 months from the date upon which the Fund commenced investment operations.
(G) FINANCIAL STATEMENTS PREPARATION
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses for the
period. Actual results could differ from those estimates.
3. ADVISORY, ADMINISTRATION AND OTHER TRANSACTIONS WITH AFFILIATES
The Bank of New York acts as the Fund's investment adviser (the 'Adviser').
The Adviser manages the investments of the Fund and is responsible for all
purchases and sales of the Fund's portfolio securities. The Adviser's fee is
accrued daily
- --------------------------------------------------------------------------------
9
<PAGE>
- --------------------------------------------------------------------------------
- --------- Notes to Financial Statements (continued)
and is payable monthly at the annual rate of .10% of the average daily net
assets of the Fund.
BNY Hamilton Distributors, Inc. acts as the Fund's administrator (the
'Administrator') and will assist generally in supervising the operations of the
Fund.
The Administrator has agreed to provide facilities, equipment and personnel
to carry out administrative services for the Fund, including, among other
things, providing the services of persons who may be appointed as officers and
directors of the Fund, monitoring the custodian, fund accounting, transfer
agency, administration, distribution, advisory and legal services that are
provided to the Fund.
The Administrator's fee is accrued daily and is payable monthly at the annual
rate of .10% of the average daily net assets of the Fund.
In addition to acting as Administrator, BNY Hamilton Distributors, Inc. is
the principal underwriter and distributor of shares of the Fund. The Bank of New
York serves as the Fund's custodian and also serves as the fund accounting
agent.
The Company has adopted a shareholder servicing plan, pursuant to which
Hamilton Premier Shares and Hamilton Classic Shares are sold to certain
institutions that enter into servicing agreements with the Company. The Bank of
New York and the Administrator (the 'Shareholder Servicing Agents') have each
entered into shareholder service agreements with respect to Hamilton Premier
Shares and Hamilton Classic Shares. The Shareholder Servicing Agents will
perform shareholder support services. Pursuant to the shareholder servicing
agreements, the Hamilton Premier Shares and Hamilton Classic Shares will pay the
Shareholder Servicing Agents an annual shareholder servicing fee, accrued daily
and payable monthly, of .25% of the Hamilton Premier Shares' and Hamilton
Classic Shares' respective average daily net assets. The shareholder servicing
plan does not cover, and the fees thereunder are not payable to, shareholder
organizations with respect to Hamilton Shares.
The Fund has adopted a distribution plan ('12b-1 Plan') with respect to
Hamilton Classic Shares of the Fund, pursuant to which the Fund will pay BNY
Hamilton Distributors, Inc. for expenses incurred during the year in connection
with the distribution of Hamilton Classic Shares. The aggregate amount payable
annually by the Fund as provided in the 12b-1 Plan may not exceed .25% of the
Hamilton Classic Shares' average daily net assets.
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10
<PAGE>
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- --------- Report of Independent Accountants
The Shareholders and Board of Directors of
BNY Hamilton Money Fund:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of BNY Hamilton Money Fund as of December 31, 1996,
the related statements of operations for the year then ended and of changes in
net assets for each of the two years in the period then ended, and the financial
highlights for each of the four years in the period then ended and for the
period August 7, 1992 (commencement of investment operations) through December
31, 1992. These financial statements and financial highlights are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
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 December
31, 1996 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, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of BNY
Hamilton Money Fund as of December 31, 1996, 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 LLP
New York, New York
February 7, 1997
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11
<PAGE>
DIRECTORS AND OFFICERS
Edward L. Gardner, Director and Chairman of the Board
Peter Herrick, Director
Leif H. Olsen, Director
Stephen Stamas, Director
James E. Quinn, Director
J. David Huber, Chief Executive Officer
William J. Tomko, President
Michael J. Brascetta, Vice President
Mary A. Madick, Vice President
Karen A. Doyle, Vice President
Anthony L. Mercure, Vice President
Martin R. Dean, Assistant Treasurer
George O. Martinez, Secretary
Alaina Metz, Assistant Secretary
Bruce Treff, Assistant Secretary
INVESTMENT ADVISER
The Bank of New York
ADMINISTRATOR AND DISTRIBUTOR
BNY Hamilton Distributors, Inc.
TRANSFER AGENT
BISYS Fund Services, Ohio, Inc.
CUSTODIAN
The Bank of New York
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
LEGAL COUNSEL
Sullivan & Cromwell
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12
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<PAGE>
BNY HAMILTON DISTRIBUTORS, INC. IS THE FUND'S DISTRIBUTOR AND IS UNAFFILIATED
WITH THE BANK OF NEW YORK, THE INVESTMENT ADVISER.
This report is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus for BNY Hamilton Money Fund. For
additional prospectuses, which contain more complete information, including
charges and expenses, call 1-800-426-9363. Please read the prospectus carefully
before investing or sending money.
BNY HAMILTON FUNDS, INC.
3435 Stelzer Road
Columbus, Ohio 43219-3035
INVESTMENTS IN BNY HAMILTON MONEY FUND ARE NOT DEPOSITS, ARE NEITHER GUARANTEED
BY NOR OBLIGATIONS OF THE BANK OF NEW YORK AND ARE NOT INSURED BY THE FDIC OR
ANY OTHER GOVERNMENTAL AGENCY. INVESTMENTS IN MUTUAL FUNDS INVOLVE RISKS,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
BNY-0046
BNY HAMILTON MONEY FUND
ANNUAL REPORT
DECEMBER 31, 1996
o HAMILTON SHARES
o HAMILTON PREMIER SHARES
o HAMILTON CLASSIC SHARES
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