CASH RESOURCE TRUST
SEMI-ANNUAL REPORT
JANUARY 31, 1996
TO OUR SHAREHOLDERS
Thank you for your investment in the Cash Resource Trust (CRT). It is our
privilege to send you the CRT Semi-Annual Report for the period ended January
31, 1996. The Cash Resource Trust (CRT) money-market funds are part of a
diversified family of mutual funds offered by Mentor Investment Group, an
investment management firm with more than the $5.5 billion in assets under
management.
Mentor manages mutual funds and separately-invested portfolios for individuals
and institutions in seven different investment management styles: Growth from
investments in small companies, large high-quality companies, and global and
international investments; fixed-income management for current income or total
return; and cash management.
The CRT money-market funds seek current income consistent with preservation of
capital and maintenance of liquidity. CRT now serves the needs of more than
300,000 investors. The Funds are managed according to a policy that places
strong emphasis on credit research. Each investment is carefully reviewed and
quality is never sacrificed to attain higher yields.
Following are financial statements for the Money-Market Funds, the U.S.
Government Money-Market Fund, and the Tax-Exempt Money-Market Fund, with
comments from members of the management team regarding their investment strategy
and economic outlook.
We appreciate your confidence in us and look forward to continuing to serve you.
Sincerely,
/s/ DANIEL J. LUDEMAN /s/ PAUL F. COSTELLO
Daniel J. Ludeman Paul F. Costello
CHAIRMAN PRESIDENT
AN INVESTMENT IN THE FUNDS IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT AND THERE IS NO GUARANTEE THAT THE FUNDS WILL MAINTAIN A STABLE NET
ASSET VALUE OF $1.00 PER SHARE.
FOR MORE INFORMATION AND PROSPECTUSES FOR MENTOR FUNDS AND MENTOR INSTITUTIONAL
SERIES TRUST, PLEASE CALL US (800/382-0016), OR CONTACT YOUR FINANCIAL
CONSULTANT. THE PROSPECTUSES CONTAIN COMPLETE INFORMATION REGARDING FEES, SALES
CHARGES, AND EXPENSES. PLEASE READ THEM CAREFULLY BEFORE INVESTING OR SENDING
MONEY.
1
<PAGE>
CASH RESOURCE TRUST
MANAGERS' OVERVIEW
JANUARY 31, 1996
The three portfolios of the Cash Resource Trust (CRT), managed by Commonwealth
Investment Counsel, are invested in accordance with conservative standards which
place primary emphasis on liquidity and safety of principal:
* The CRT Money-Market Fund is a diversified portfolio of fixed-income
securities, including commercial paper, bank obligations, and other
short-term investments.
* The CRT U.S. Government Money-Market Fund is invested entirely in securities
backed by the U.S. government or its agencies, and related repurchase
agreements.
* The CRT Tax-Exempt Money-Market Fund is structured to generate income exempt
from federal taxes.
The six months ending January 31, 1996 was one of mixed signals for money
managers. The period began August 1, 1995 with the Federal Reserve having just
lowered the key Fed Funds rate to 5.75%, the first reduction in two years. The
next four months witnessed a mixed pattern of economic data, with the economy
seemingly poised for strong growth but frustrated by a sluggish consumer. During
this period the markets tended to vacillate within a relatively narrow trading
range based on whether the latest statistics were weak or strong. But the
strongest evidence indicated a soft economy, with the result that the Fed
reduced rates to 5.50% in December and 5.25% in January.
It now appears, however, that the data for the latter part of the period were
distorted, first by the partial government shut-down and then by the bad
weather, and were not as weak as first reported. Expectations now are that the
economy may finally be on a more positive growth track and further cuts by the
Fed may not be forthcoming.
The fixed-income markets sold off sharply in response to this change in
expectations, with rates rising. The money-market area was no exception. The
remainder of the year appears more uncertain than usual, with the course of the
economy and Fed policy somewhat open to question, the budget impasse still not
resolved, and presidential elections taking place. Volatility is likely to be
high, and our pledge to you is to continue our emphasis on safety and liquidity
through high credit standards and conservative investment policies.
/s/ R. PRESTON NUTTALL
R. Preston Nuttall
DIRECTOR OF CASH MANAGEMENT
/s/ HUBERT R. WHITE
Hubert R. White
PORTFOLIO MANAGER
/s/ KATHRYN T. ALLEN
Kathryn T. Allen
PORTFOLIO MANAGER
2
<PAGE>
CASH RESOURCE TRUST
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
BANKERS ACCEPTANCES 1.34%
Corestates Bank, 5.57%, 2/20/96 $ 2,000 $ 1,994
Nationsbank Corporation, 5.25%, 4/23/96 5,000 4,940
TOTAL BANKERS ACCEPTANCES 6,934
CERTIFICATES OF DEPOSIT 7.73%
Bank of Montreal, 5.53%, 2/08/96 20,000 20,000
National Bank of Detroit, 5.46%, 2/16/96 20,000 20,000
TOTAL CERTIFICATES OF DEPOSIT 40,000
COMMERCIAL PAPER 70.43%
APPAREL & ACCESSORY STORES 3.85%
J.C. Penny Funding Corporation, 5.62%, 2/29/96 20,000 19,913
ASSET BACKED SECURITIES 3.85%
CIESCO Limited Partnership, 5.64%, 2/22/96 20,000 19,934
COMMERCIAL BANKS 21.65%
ABN-Amro North America Finance, Inc.,
5.68%, 2/22/96 20,000 19,934
Corestates Capital Corporation, 5.13%, 6/13/96 18,000 17,659
Internationale Nederlanden, 5.64%, 2/27/96 10,000 9,959
Internationale Nederlanden, 5.61%, 3/15/96 10,000 9,933
Nationsbank Corporation, 5.54%, 3/28/96 10,000 9,913
Nationsbank Corporation, 5.50%, 5/17/96 5,000 4,919
Societe Generale N.A., Inc., 5.61%, 2/09/96 20,000 19,975
Svenska Handelsbanken, 5.37%, 4/10/96 20,000 19,794
Total Commercial Banks 112,086
ELECTRIC SERVICES 6.76%
National Rural Utilities, 5.55%, 3/26/96 20,000 19,834
Rincon Securities, Inc., 5.81%, 2/02/96 2,000 2,000
Rincon Securities, Inc., 5.66%, 2/23/96 9,850 9,816
Rincon Securities, Inc., 5.48%, 2/27/96 2,150 2,141
Rincon Securities, Inc., 5.56%, 2/29/96 1,250 1,245
Total Electric Services 35,036
</TABLE>
3
<PAGE>
CASH RESOURCE TRUST
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
OIL AND GAS FIELD EXPLORATION SERVICES 3.85%
Statoil, 5.70%, 2/22/96 $20,000 $ 19,934
PERSONAL CREDIT INSTITUTIONS 3.84%
Ford Motor Credit Company, 5.43%, 3/12/96 20,000 19,879
PETROLEUM REFINING 3.66%
Pemex Capital, Inc., 5.73%, 2/13/96 8,000 7,985
Pemex Capital, Inc., 5.71%, 2/16/96 11,000 10,974
Total Petroleum Refining 18,959
RENTAL & LEASING 3.71%
General Electric Capital Corporation,
5.50%, 4/04/96 6,400 6,338
General Electric Capital Corporation, 5.26%, 4/1/96 13,000 12,852
Total Rental & Leasing 19,190
SECURITY BROKERS & DEALERS 15.40%
Bear Stearns Company, 5.52%, 2/09/96 20,000 19,975
CS First Boston, Inc., 5.51%, 2/14/96 13,000 12,974
CS First Boston, Inc., 5.36%, 3/14/96 7,000 6,956
Merrill Lynch & Company, Inc., 5.58%, 3/08/96 8,000 7,955
Merrill Lynch & Company, Inc., 5.67%, 3/29/96 12,000 11,892
Morgan Stanley Group, Inc., 5.50%, 2/16/96 20,000 19,954
Total Security Brokers & Dealers 79,706
TOBACCO PRODUCTS 3.86%
Philip Morris, 5.48%, 2/07/96 20,000 19,982
TOTAL COMMERCIAL PAPER 364,619
</TABLE>
4
<PAGE>
CASH RESOURCE TRUST
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
FOREIGN GOVERNMENT OBLIGATIONS 3.85%
Province of British Columbia, 5.58%, 2/26/96 $20,000 $ 19,923
U.S. GOVERNMENT SECURITIES AND AGENCIES 7.72%
Federal Home Loan Bank,
5.75%-6.17%, 12/23/96-2/14/97 (a) 15,000 15,000
Student Loan Marketing Association,
5.33%-5.36%, 11/24/97-2/22/99 (a) 25,000 24,997
TOTAL U.S. GOVERNMENT SECURITIES AND AGENCIES 39,997
REPURCHASE AGREEMENTS 8.98%
Goldman, Sachs & Company
Dated 1/31/96, 5.90%, due 2/01/96, collateralized by
$47,023 Federal National Mortgage Association, 7.00%,
1/01/26 46,471 46,471
TOTAL INVESTMENTS (COST $517,944) 100.05% 517,944
OTHER ASSETS LESS LIABILITIES (0.05%) (260)
NET ASSETS 100.00% $517,684
</TABLE>
SEE NOTES TO PORTFOLIOS OF INVESTMENTS.
5
<PAGE>
CASH RESOURCE TRUST
U.S. GOVERNMENT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES AND AGENCIES 51.93%
Federal Home Loan Bank
5.18% - 9.75%, 2/09/96 - 5/02/96 $ 152,000 $150,920
5.51% - 6.04%, 3/08/96 - 2/16/99 (a) 62,000 62,000
Federal Home Loan Mortgage Corporation
5.28% - 6.84%, 2/05/96 - 4/11/96 197,207 196,709
Federal National Mortgage Association
5.02% - 5.55%, 2/27/96 - 7/12/96 170,000 167,912
Student Loan Marketing Association
5.33% - 6.08%, 7/01/96 - 2/08/99 (a) 112,500 112,498
TOTAL U.S. GOVERNMENT SECURITIES AND AGENCIES 690,039
REPURCHASE AGREEMENTS 47.88%
Chase Manhatten Securities, Inc.
Dated 1/31/96, 5.90%, due 2/01/96, collateralized
by $60,193 Federal National Mortgage Association,
7.00% - 7.50%, 3/01/24 - 12/01/25 60,000 60,000
First Union Corporation
Dated 1/31/96, 5.91%, due 2/01/96, collateralized by
$181,056 U.S. Treasury Notes, 6.13%, 5/31/97 and $8,512
U.S. Treasury Bill, 4.78%, 10/17/96 190,000 190,000
Goldman, Sachs & Company
Dated 1/31/96, 5.90%, due 2/01/96, collateralized by
$147,975 Federal National Mortgage Association, 7.00%,
1/01/26 146,237 146,237
Lehman Brothers, Inc.
Dated 1/31/96, 5.91%, due 2/01/96, collateralized
by $24,621 Federal National Mortgage Association,
3/01/24 - 4/01/24 and $35,619 Federal Home Loan Mortgage
Corporation, 6.50% - 7.00%, 7/01/09 - 1/01/24 60,000 60,000
</TABLE>
6
<PAGE>
CASH RESOURCE TRUST
U.S. GOVERNMENT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Nationsbank Corporation
Dated 1/31/96, 5.95%, due 2/01/96, collateralized by
$57,600 U.S. Treasury Notes, 6.25%, 8/31/00 $60,000 $ 60,000
Paine Webber, Inc.
Dated 1/31/96, 5.92%, due 2/01/96, collateralized
by $68,275 Government National Mortgage Association,
7.00% - 7.50%, 11/15/23 - 11/15/27 60,000 60,000
United Bank of Switzerland
Dated 1/31/96, 5.82%, due 2/01/96, collateralized
by $3,242 Federal Home Loan Mortgage Corporation,
5.50% - 9.50%, 10/01/02 - 2/01/25 and $59,746 Federal
National Mortgage Association - Strips, 6.50% - 9.00%,
11/01/02 - 8/01/23 60,000 60,000
TOTAL REPURCHASE AGREEMENTS 636,237
TOTAL INVESTMENTS (COST $1,326,276) 99.81% 1,326,276
OTHER ASSETS LESS LIABILITIES 0.19% 2,534
NET ASSETS 100.00% $1,328,810
</TABLE>
SEE NOTES TO PORTFOLIOS OF INVESTMENTS.
7
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
VARIABLE RATE TAX-EXEMPT
DEMAND SECURITIES (A) 43.63%
ALABAMA 2.11%
University of Alabama Board of Trustees,
3.15%, 10/01/13 $ 6,400 $ 6,400
ARIZONA 3.30%
Apache County IDA Tucson Electric Power
Company Project, 3.15%, 6/15/20 10,000 10,000
COLORADO 2.48%
Colorado Housing Finance Authority
Series 1985, 3.30%, 5/01/97 7,500 7,500
ILLINOIS 4.45%
Chicago O'Hare International Airport American Airlines
Series 1983C, 3.20%, 1/01/18 2,000 2,000
Illinois DFA Grayhill, Inc. Project
IDR, 3.35%, 2/01/05 3,500 3,500
Illinois DFA, 3.35%, 10/01/15 4,760 4,760
Illinois HFA West Suburban Hospital, 3.15%, 7/01/05 3,200 3,200
13,460
LOUISIANA 2.00%
Louisiana Public Facility College & University Project,
3.10%, 9/01/10 6,065 6,065
MARYLAND 3.28%
Anne Arundel County, Oakland Hills Project,
3.30%, 5/15/15 2,052 2,052
Howard County PCR, Harmony Hall, Inc. Project, 3.30%,
10/01/10 2,868 2,868
Maryland State Health & Higher Education, Series B,
3.10%, 4/01/35 5,000 5,000
9,920
</TABLE>
8
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
VARIABLE RATE TAX-EXEMPT
DEMAND SECURITIES (CONTINUED)
NORTH CAROLINA 5.85%
Durham County Water & Sewer, 3.10%, 12/01/15 $ 2,800 $ 2,800
Lincoln County Industrial Facility PCR Series 1994,
3.45%, 8/01/09 6,000 6,000
North Carolina Educational Facilities
Bowman Grey School, 3.15%, 9/01/20 4,200 4,200
North Carolina Medical Care Moses
Cone Hospital Series 1995, 3.15%, 9/01/02 4,700 4,700
17,700
NEW HAMPSHIRE 3.30%
New Hampshire Health & Higher Education Series E,
3.15%, 12/01/25 10,000 10,000
NEW JERSEY 1.32%
New Jersey Sports & Exposition Series C,
2.85%, 9/01/24 4,000 4,000
PUERTO RICO 0.03%
Puerto Rico Highway & Transportation Series X,
2.80%, 7/01/99 100 100
TENNESSEE 0.74%
Nashville and Davidson County Health and Education
Facility, 3.30%, 5/01/20 2,224 2,224
TEXAS 4.23%
Greater East Texas Higher Education Series A,
3.30%, 5/01/11 1,500 1,500
North Texas Higher Education Student Loan Revenue Refund,
Series 1991F, 3.25%, 4/01/20 4,000 4,000
Panhandle Plains Student Loan Revenue Series A,
3.20%, 6/01/21 1,300 1,300
Red River Authority PCR, 3.10%, 7/01/11 5,000 5,000
</TABLE>
9
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
VARIABLE RATE TAX-EXEMPT
DEMAND SECURITIES (CONTINUED)
TEXAS (CONTINUED)
Texas Education Authority Series 1985B,
3.10%, 12/01/25 $1,000 $ 1,000
12,800
VIRGINIA 8.56%
Capital Region Airport Series 1995C,
3.05%, 7/01/23 3,000 3,000
Chesterfield County IDR Midlothian Hotel Partnership,
3.30%, 12/01/14 6,344 6,344
IDR of Hanover County Carter Machinery,
3.30%, 11/01/98 500 500
IDA of Henrico County Hermitage Project,
3.70%, 5/01/24 4,500 4,500
Loudon County IDR Falcons Landing, Series B,
3.70%, 11/01/24 300 300
Lynchburg IDA Mid-Atlantic Series G,
3.15%, 12/01/25 500 500
Peninsula Port Authority Dominion Terminal Association,
3.70%, 7/01/16 3,000 3,000
Richmond IDR Commonwealth Park,
3.35%, 11/01/07 1,364 1,364
Roanoke IDR Quibell Corporate Project,
3.30%, 9/01/15 292 292
Spotsylvania City IDA Residential Care Facilities,
3.30%, 10/01/20 4,684 4,684
Tazewell County IDR, 3.50%, 1/01/03 1,000 1,000
Virginia Beach Revenue Bond, 3.30%, 9/01/09 410 410
25,894
WISCONSIN 0.66%
Village of Pleasant Prairie Muskie Enterprise Project,
Series 1995, 3.35%, 5/01/15 2,000 2,000
</TABLE>
10
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
VARIABLE RATE TAX-EXEMPT
DEMAND SECURITIES (CONTINUED)
WYOMING 1.32%
Sweetwater County PCR Pacific Corporation Project,
3.15%, 7/01/15 $ 4,000 $ 4,000
TOTAL VARIABLE RATE TAX-EXEMPT DEMAND SECURITIES 132,063
OTHER TAX-EXEMPT SECURITIES 59.51%
ALABAMA 0.92%
IDB of Fairfield USX Corporation Project, Series 1995,
3.70%, 5/01/96 2,800 2,800
FLORIDA 8.82%
City of Jacksonville Series A,
3.20% - 3.35%, 2/26/96 - 4/08/96 14,800 14,800
Orange County Health Facilities Series 1985,
3.25%, 2/22/96 3,400 3,400
Putnam County Development Authority Seminole Electric
Series 1984, 3.30%, 6/15/96 3,000 3,000
St. Lucie County Florida Power & Light PCR,
3.75%, 3/08/96 3,000 3,000
Sunshine State Government Finance Commission Series 1986
Revenue Bond, 3.80%, 2/06/96 2,500 2,500
26,700
ILLINOIS 2.05%
City of Chicago GO Series 1995A, 3.75%, 5/01/96 3,200 3,200
State of Illinois RANS, 4.50%, 5/10/96 3,000 3,005
6,205
KANSAS 1.65%
Burlington Revenue Refund Bond, 3.75%, 2/13/96 5,000 5,000
</TABLE>
11
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
OTHER TAX-EXEMPT SECURITIES (CONTINUED)
KENTUCKY 0.66%
Pulaski County Solid Waste Project Series B,
3.90%, 2/15/96 $ 2,000 $ 2,000
LOUISIANA 3.30%
Plaquemines Port Harbor Series C,
3.80% - 3.90%, 2/14/96 - 2/16/96 10,000 10,000
MARYLAND 0.99%
Baltimore County PCR Baltimore Gas & Electric,
3.40%, 3/07/96 3,000 3,000
MINNESOTA 2.20%
Rochester Health Care Series C, 3.70%, 2/27/96 5,500 5,500
University of Minnesota Revenue Bond,
3.25%, 8/01/96 1,150 1,150
6,650
MISSISSIPPI 0.76%
Claiborne County PCR, 3.45%, 3/08/96 2,300 2,300
NORTH CAROLINA 2.61%
Wake County Industrial Facility Series 1990A,
3.80%, 2/01/96 2,900 2,900
Wake County Industrial Facility Series 1990A,
3.75%, 2/07/96 5,000 5,000
7,900
NEW JERSEY 1.12%
Port Authority New York & New Jersey Series B, 3.10%,
3/12/96 1,395 1,395
State of New Jersey GO, 3.10%, 3/12/96 2,000 2,000
3,395
</TABLE>
12
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
OTHER TAX-EXEMPT SECURITIES (CONTINUED)
NEW HAMPSHIRE 0.66%
New Hampshire New England Power Series 1990A,
3.90%, 2/21/96 $ 2,000 $ 2,000
NEW YORK 0.99%
New York City Series 1996A, 4.50%, 2/15/96 3,000 3,001
NEVADA 1.19%
Washoe County Water Facility, 3.70%, 4/10/96 3,600 3,600
SOUTH CAROLINA 3.64%
York County PCR Series 1984N-3, 3.75%, 3/15/96 6,000 6,000
Beaufort County Series 1995, 4.13%, 8/15/96 5,000 5,006
11,006
TEXAS 10.52%
Brazos Harbor Industrial Development Series 1986,
3.75%, 2/12/96 3,700 3,700
Harris County Health Care, 3.55%, 2/28/96 4,700 4,700
Harris County Health Care, 3.30%, 4/10/96 3,000 3,000
Houston Water & Sewer Series A, 3.20%, 4/11/96 2,500 2,500
San Antonio Electric & Gas Series A,
3.85%, 2/08/96 3,300 3,300
San Antonio Electric & Gas Series A,
3.45%, 3/11/96 3,600 3,600
State of Texas TRANS Series A, 4.75%, 3/11/96 8,000 8,033
Texas A&M University Series B, 3.55%, 2/26/96 3,000 3,000
31,833
UTAH 1.32%
Emory County PCR Pacific Corporation Project,
3.50%, 2/15/96 4,000 4,000
VIRGINIA 8.18%
City of Richmond RANS Series 1996A,
4.00%, 6/28/96 5,000 5,014
</TABLE>
13
<PAGE>
CASH RESOURCE TRUST
TAX-EXEMPT MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Percent of Principal Value
Net Assets Amount (Note 2)
<S> <C> <C> <C>
OTHER TAX-EXEMPT SECURITIES (CONTINUED)
VIRGINIA (CONTINUED)
Commonwealth of Virginia GO Series 1995,
3.65%, 2/12/96 $ 4,600 $ 4,600
Peninsula Port Authority, 3.55%, 7/01/16 3,135 3,135
Virginia State Housing Development Series D,
3.75%, 3/04/96 7,000 7,000
York County IDA PCR, 3.60%, 3/07/96 5,000 5,000
24,749
WEST VIRGINIA 6.61%
West Virginia HDA, 3.45% - 3.70%,
2/01/96 - 3/01/96 20,000 20,000
OTHER 1.32%
PNC Municash, 3.46%, 2/01/96 4,000 4,000
TOTAL OTHER TAX-EXEMPT SECURITIES 180,139
TOTAL INVESTMENTS (COST $312,202) 103.14% 312,202
OTHER ASSETS LESS LIABILITIES (3.14%) (9,517)
NET ASSETS 100.00% $302,685
</TABLE>
NOTES TO PORTFOLIOS OF INVESTMENTS
(a) Floating Rate Securities -- The rates shown are the effective rates at
January 31, 1996.
(b) Interest rates represent annualized yield to date of maturity, except for
variable rate securities described in (a). For each security, cost (for
financial reporting and federal income tax purposes) and carrying value are
the same.
INVESTMENT ABBREVIATIONS
<TABLE>
<S> <C>
DFA - Development Finance Authority IDB - Industrial Development Board
GO - General Obligation IDR - Industrial Development Revenue
HDA - Housing Development Authority PCR - Pollution Control Revenue
HFA - Housing Finance Authority RANS - Revenue Anticipation Note
IDA - Industrial Development Authority TRANS - Tax and Revenue Anticipation Note
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE>
CASH RESOURCE TRUST
STATEMENTS OF ASSETS AND LIABILITIES
JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
U.S.
Money Government Tax-Exempt
Market Money Market Money Market
Fund Fund Fund
<S> <C> <C> <C>
ASSETS
Investments, at amortized cost (Note 2)
Investment securities $471,473 $ 690,039 $ 312,202
Repurchase agreements 46,471 636,237 -
Total Investments 517,944 1,326,276 312,202
Interest receivable 520 4,558 1,775
Deferred expenses (Note 2) 78 365 80
Other 302 391 190
Total assets 518,844 1,331,590 314,247
LIABILITIES
Payables
Dividends 1,027 2,544 331
Securities purchased - - 11,150
Accrued distribution fee (Note 3) 32 83 16
Accrued expenses and other liabilities 101 153 65
Total liabilities 1,160 2,780 11,562
NET ASSETS $517,684 $ 1,328,810 $ 302,685
Shares outstanding 517,684 1,328,863 302,688
Net asset value per share $ 1.00 $ 1.00 $ 1.00
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE>
CASH RESOURCE TRUST
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JANUARY 31, 1996 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Money U.S. Government Tax-Exempt
Market Money Market Money Market
Fund Fund Fund
<S> <C> <C> <C>
INVESTMENT INCOME
Interest $13,955 $36,434 $5,259
EXPENSES
Distribution fee (Note 3) 908 2,386 457
Transfer agent fee (Note 3) 341 1,606 130
Management fee (Note 3) 526 1,275 305
Custodian and accounting fees 95 324 76
Shareholder reports 34 117 26
Professional fees 7 19 4
Registration fees 36 97 33
Organizational expenses 6 28 6
Directors' fees 5 8 4
Other 5 20 5
Total expenses 1,963 5,880 1,046
NET INVESTMENT INCOME 11,992 30,554 4,213
Net increase in net assets resulting from operations $11,992 $30,554 $4,213
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE>
CASH RESOURCE TRUST
STATEMENTS OF CHANGES IN NET ASSETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
MONEY U.S. GOVERNMENT TAX-EXEMPT
MARKET MONEY MARKET MONEY MARKET
FUND FUND FUND
Six Months Six Months Six Months
Ended Year Ended Year Ended Year
1/31/96 Ended 1/31/96 Ended 1/31/96 Ended
(Unaudited) 7/31/95 (Unaudited) 7/31/95 (Unaudited) 7/31/95
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS
OPERATIONS
Net investment income $ 11,992 $ 13,949 $ 30,554 $ 47,780 $ 4,213 $ 6,665
Net realized gain (loss)
on investments sold - 4 - (53) - (3)
Increase in net
assets from
operations 11,992 13,953 30,554 47,727 4,213 6,662
DISTRIBUTIONS TO
SHAREHOLDERS
Net investment income (11,992) (13,949) (30,554) (47,780) (4,213) (6,665)
Net realized gain on
investments - (4) - - - -
Net decrease from
distributions (11,992) (13,953) (30,554) (47,780) (4,213) (6,665)
CAPITAL SHARE TRANSACTIONS
(AT $1.00 PER SHARE)
Net proceeds from sale of
shares 1,393,241 1,715,060 2,715,867 4,322,307 611,390 1,029,842
Reinvestment of dividends 11,800 13,420 30,330 46,908 4,199 6,528
Cost of shares redeemed (1,310,014) (1,498,083) (2,634,077) (4,060,291) (579,799) (965,174)
Change in net assets
from capital share
transactions 95,027 230,397 112,120 308,924 35,790 71,196
Net increase in net assets 95,027 230,397 112,120 308,871 35,790 71,193
NET ASSETS
Beginning of period 422,657 192,260 1,216,690 907,819 266,895 195,702
End of period $ 517,684 $ 422,657 $1,328,810 $1,216,690 $ 302,685 $ 266,895
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
CASH RESOURCE TRUST
FINANCIAL HIGHLIGHTS
<TABLE> Money
<CAPTION> Market
Fund
Six
Months
Ended Year Period
1/31/96 Ended Ended
(Unaudited) 7/31/95 7/31/94*
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income 0.02 0.05 0.02
DISTRIBUTIONS
Net investment income (0.02) (0.05) (0.02)
NET ASSET VALUE, END OF PERIOD $ 1.00 $ 1.00 $ 1.00
Total Return 2.55% 4.97% 1.83%
Ratios / Supplemental Data
Net assets, end of period (in thousands) $ 517,684 $422,657 $ 192,260
Ratio of expenses to average net assets 0.82%(a) 0.82% 0.89%(a)
Ratio of expenses to average net assets excluding waivers 0.82%(a) 0.82% 0.93%(a)
Ratio of net investment income to average net assets 5.00%(a) 4.96% 2.96%(a)
</TABLE>
(a) Annualized.
* For the period from December 20, 1993 (commencement of operations) to July
31, 1994.
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
<TABLE>
<CAPTION>
U.S. Government Tax-Exempt
Money Market Money Market
Fund Fund
Six Six
Months Months
Ended Year Period Ended Year Period
1/31/96 Ended Ended 1/31/96 Ended Ended
(Unaudited) 7/31/95 7/31/94* (Unaudited) 7/31/95 7/31/94*
<S> <C> <C> <C> <C> <C>
$ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
0.02 0.05 0.02 0.01 0.03 0.01
(0.02) (0.05) (0.02) (0.01) (0.03) (0.01)
$ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
2.47% 4.82% 1.82% 1.55% 3.05% 1.16%
$ 1,328,810 $1,216,690 $907,819 $ 302,685 $266,895 $ 195,702
0.92%(a) 0.88% 0.80%(a) 0.75%(a) 0.72% 0.65%(a)
0.92%(a) 0.88% 0.83%(a) 0.75%(a) 0.74% 0.74%(a)
4.85%(a) 4.75% 2.91%(a) 3.03%(a) 3.01% 1.87%(a)
</TABLE>
19
<PAGE>
CASH RESOURCE TRUST
NOTES TO FINANCIAL STATEMENTS
JANUARY 31, 1996 (UNAUDITED)
NOTE 1: ORGANIZATION
Cash Resource Trust ("Trust") was organized on June 14, 1993 and is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company. The Trust consists of three separate diversified funds
(hereinafter each individually referred to as a "Fund" or collectively as the
"Funds") at January 31, 1996 as follows:
Cash Resource Money Market Fund ("Money Market Fund")
Cash Resource U.S. Government Money Market Fund ("U.S. Government Fund")
Cash Resource Tax-Exempt Money Market Fund ("Tax-Exempt Fund")
The investment objective of each Fund is to seek current income consistent with
preservation of capital and maintenance of liquidity.
The assets of each Fund of the Trust are segregated and a shareholder's interest
is limited to the Fund in which shares are held.
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. The
policies are in conformity with generally accepted accounting principles which
required management to make estimates and assumptions that affect amounts
reported herein. Although actual results could differ from these estimates, any
such differences are expected to be immaterial to the net assets of the Fund.
A. Valuation of Securities
Investments are stated at amortized cost, which approximates market value. In
the event that a deviation of 1/2 of 1% or more exists between a Fund's $1.00
per share net asset value, calculated at amortized cost, and the net asset value
calculated by reference to market-based values, or if there is any other
deviation that the Board of Trustees believes would result in a material
dilution to shareholders or purchasers, the Board of Trustees will promptly
consider what action should be initiated.
B. Repurchase Agreements
It is the policy of the Trust to require the custodian bank to take possession,
to have legally segregated in the Federal Reserve Book entry system, or to have
segregated within the custodian bank's vault all securities held as collateral
in support of repurchase agreement investments. Additionally, procedures have
been
20
<PAGE>
CASH RESOURCE TRUST
NOTES TO FINANCIAL STATEMENTS
(CONTINUED)
established by the Trust to monitor, on a daily basis, the market value of each
repurchase agreement's underlying securities to ensure the existence of a proper
level of collateral.
The Trust will only enter into repurchase agreements with banks and other
recognized financial institutions such as broker/dealers which are deemed by the
Trust's adviser to be creditworthy pursuant to guidelines established by the
Board of Trustees. Risks may arise from the potential inability of
counterparties to honor the terms of the repurchase agreement. Accordingly, the
Trust could receive less than the repurchase price on the sale of collateral
securities.
C. Security Transactions and Interest Income
Security transactions for the Funds are accounted for on a trade date basis.
Interest income is recorded on the accrual basis and includes amortization of
premium and discount on investments.
D. Expenses
Expenses arising in connection with a Fund are allocated to that Fund. Other
Trust expenses are allocated among the Funds in proportion to their relative net
assets.
E. Fund Share Valuation and Dividends to Shareholders
Fund shares are sold and redeemed on a continual basis at net asset value. The
net asset value per share (NAV) of each Fund is determined daily as of 4:00 p.m.
on each day that the New York Stock Exchange is open for trading. Each Fund
determines its NAV by dividing the total value of the Fund's investments and
other assets, less liabilities, by the number of Fund shares outstanding. Each
Fund declares a daily dividend, equal to its net investment income for that day
and payable at month end. Distributions from net realized capital gains, if any,
are paid annually.
F. Federal Income Taxes
No provision for federal income taxes has been made since it is each Fund's
policy to comply with the provisions applicable to regulated investment
companies under the Internal Revenue Code and to distribute to its shareholders
within the allowable time limit substantially all taxable income and realized
capital gains.
At July 31, 1995, U.S. Government Fund for federal tax purposes, had a capital
loss carryforward of approximately $54,000. Pursuant to the Code, such capital
loss
21
<PAGE>
CASH RESOURCE TRUST
NOTES TO FINANCIAL STATEMENTS
(CONTINUED)
carryforwards expire as follows: $1,000 in 2002 and $53,000 in 2003.
G. Deferred Expenses
Costs incurred by the Trust in connection with its initial share registration
and organization costs were deferred by the Funds and are being amortized on a
straight-line basis over a five year period through December 1998.
NOTE 3: INVESTMENT MANAGEMENT AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT MANAGEMENT AGREEMENT
Commonwealth Advisors, Inc. (formerly Cambridge Investment Advisors, Inc.) the
Funds' investment adviser (Investment Adviser) provides investment advisory
services to each of the Funds. Commonwealth Investment Counsel, Inc.
("Commonwealth"), an affiliate of the Investment Adviser, serves as sub-adviser
to each of the Funds, pursuant to a sub-advisory agreement among the Investment
Adviser, Commonwealth and the Trust. Commonwealth furnishes a continuing
investment program for each of the Funds and makes investment decisions on their
behalf. The Investment Adviser and Commonwealth are wholly-owned subsidiaries of
Mentor Investment Group, Inc. ("Mentor") (formerly Investment Management Group,
Inc.), which is in turn a wholly-owned subsidiary of Wheat First Butcher Singer,
Inc. ("Wheat").
Each Fund pays management fees to the Investment Adviser monthly at the
following annual rates, expressed as a percentage of average daily net assets:
0.22% of the first $500 million of each Fund's average net assets; 0.20% of the
next $500 million; 0.175% of the next $1 billion; 0.16% of the next $1 billion;
and 0.15% of any amounts over $3 billion. The Investment Adviser in turn pays
fees from its own assets to Commonwealth monthly at the following annual rates
(based on the assets of each Fund taken separately): 0.17% of the first $500
million of a Fund's average net assets; 0.15% of the next $500 million; 0.125%
of the next $1 billion; 0.11% of the next $1 billion; and 0.10% of any amounts
over $3 billion. The Investment Adviser may from time to time voluntarily waive
some or all of its investment advisory fee and may terminate any such voluntary
waiver at any time at its sole discretion. For the six months ended January 31,
1996, the Investment Adviser and sub-adviser earned the following advisory fees:
22
<PAGE>
CASH RESOURCE TRUST
NOTES TO FINANCIAL STATEMENTS
(CONTINUED)
<TABLE>
<CAPTION>
Adviser Adviser Fee Sub-Adviser
Fee Voluntarily Fee
Earned Waived Earned
<S> <C> <C> <C>
Money Market Fund $ 525,631 $ - $ 404,288
U.S. Government Fund 1,274,963 - 955,616
Tax-Exempt Fund 304,628 - 234,191
</TABLE>
In addition, the Funds provide direct reimbursement to Mentor for certain
accounting and operation related costs not covered under the Investment
Management Agreement. For the six months ended January 31, 1996, the Money
Market Fund, U.S. Government Fund and Tax-Exempt Fund paid $10,634, $28,058 and
$6,620, respectively to Mentor for these direct reimbursements.
DISTRIBUTION AGREEMENT
Under a Distribution Agreement, Mentor Distributors, Inc. ("Mentor
Distributors") (formerly, Cambridge Distributors, Inc.) a wholly-owned
subsidiary of Mentor, was appointed Distributor for each Fund. To compensate
Mentor Distributors for the services it provides and for the expenses it incurs
under the Distribution Agreement, the Funds have adopted a Plan of Distribution
pursuant to Rule 12b-1 under the Investment Company Act of 1940, under which
they pay a distribution fee, which is accrued daily and paid monthly at the
annual rate of 0.38% of the Fund's average daily net assets for the Money Market
Fund and U.S. Government Fund and 0.33% of the Fund's average daily net assets
for the Tax-Exempt Fund.
TRANSFER AGENT AGREEMENT
Under a Transfer Agency Agreement, Investors Fiduciary Trust Company ("IFTC")
serves as Transfer Agent and Dividend Disbursing Agent for each Fund. IFTC in
turn compensates Wheat (from IFTC's own assets) for related services provided by
Wheat directly to its clients. For the six months ended January 31, 1996, Wheat
earned fees of $341,357, $1,605,046 and $129,043 respectively from the Money
Market Fund, U.S. Government Fund and Tax-Exempt Fund.
23
<PAGE>
SHAREHOLDER INFORMATION
TRUSTEES
Daniel J. Ludeman, TRUSTEE & CHAIRMAN
Chairman and Chief Executive Officer
Mentor Investment Group, Inc.
Arnold H. Dreyfuss, TRUSTEE
former Chairman and
Chief Executive Officer
Hamilton Beach/Proctor-Silex, Inc.
Thomas F. Keller, TRUSTEE
Dean, Fuqua School of Business
Duke University
Louis W. Moelchert, Jr., TRUSTEE
Vice President for Business & Finance
University of Richmond
Stanley F. Pauley, Jr., TRUSTEE
Chairman and Chief Executive Officer
E. R. Carpenter Company, Incorporated
Troy A. Peery, Jr., TRUSTEE
President
Heilig-Meyers Company
Peter J. Quinn, Jr., TRUSTEE
Managing Director
Mentor Investment Group, Inc.
OFFICERS
Paul F. Costello, PRESIDENT
Managing Director
Mentor Investment Group, Inc.
Terry L. Perkins, TREASURER
Vice President
Mentor Investment Group, Inc.
John M. Ivan, SECRETARY
Managing Director/Assistant General Counsel
Wheat First Butcher Singer, Inc.
Michael A. Wade, ASSISTANT TREASURER
Associate Vice President
Mentor Investment Group, Inc.
This report is authorized for distribution to prospective investors only when
preceded or accompanied by a prospectus, which contains facts concerning the
objective, policies, management fees, and expenses of the Trust and further
information.
CASH RESOURCE TRUST
901 East Byrd Street
Richmond, VA 23219
<PAGE>
[Mentor Logo]
CASH
RESOURCE
TRUST
SEMI-ANNUAL REPORT
JANUARY 31, 1996
[Mentor Logo Background]
