UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For the Period ended March 31, 1997 or
[ ] Transition report pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For the transition period from to
Commission File No. 33-71654
DWFCM INTERNATIONAL ACCESS FUND L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3700691
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
c/o Demeter Management Corp.
Two World Trade Center, New York, NY 62 Fl. 10048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 392-5454
(Former name, former address, and former fiscal year, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
<PAGE>
<TABLE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
March 31, 1997
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Statements of Financial Condition
March 31, 1997 (Unaudited) and December 31, 1996 .....2
Statements of Operations for the Quarters Ended
March 31, 1997 and 1996 (Unaudited)...................3
Statements of Changes in Partners' Capital
for the Quarters Ended March 31, 1997 and 1996
(Unaudited)...........................................4
Statements of Cash Flows for the Quarters Ended
March 31, 1997 and 1996 (Unaudited)...................5
Notes to Financial Statements (Unaudited).......6-11
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.........12-16
Part II. OTHER INFORMATION
Item 1. Legal Proceedings.............................17-18
Item 6. Exhibits and Reports on Form 8-K.................19
</TABLE>
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<TABLE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
March 31, December 31,
1997 1996
$ $
(Unaudited)
ASSETS
<S> <C> <C>
Equity in Commodity futures trading accounts:
Cash 48,087,411 44,917,336
Net unrealized gain (loss) on open contracts (974,234) 622,794
Total Trading Equity 47,113,177 45,540,130
Interest receivable (DWR) 174,153 152,193
Due from DWR 102,773 38,526
Total Assets 47,390,103 45,730,849
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable 300,946 649,420
Accrued management fee (DWFCM) 117,617 113,798
Accrued administrative expenses 114,943 100,120
Accrued brokerage commissions (DWR) 114,474 59,631
Accrued transaction fees and costs 11,240 13,426
Total Liabilities 659,220 936,395
Partners' Capital
Limited Partners (36,361.385 and
37,433.592 Units, respectively) 45,835,376 43,960,184
General Partner (710.409 Units) 895,507 834,270
Total Partners' Capital 46,730,883 44,794,454
Total Liabilities and Partners' Capital 47,390,103 45,730,849
NET ASSET VALUE PER UNIT 1,260.55 1,174.35
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Quarters Ended March 31,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 5,772,900 (4,295,963)
Net change in unrealized (1,597,028) 1,002,500
Total Trading Results 4,175,872 (3,293,463)
Interest Income (DWR) 476,296 497,982
Total Revenues 4,652,168 (2,795,481)
EXPENSES
Brokerage commissions (DWR) 872,010 1,125,248
Management fee (DWFCM) 372,673 375,083
Transaction fees and costs 40,458 73,330
Administrative expenses 24,000 22,000
Total Expenses 1,309,141 1,595,661
NET INCOME (LOSS) 3,343,027 (4,391,142)
NET INCOME (LOSS) ALLOCATION
Limited Partners 3,281,790 (4,324,431)
General Partner 61,237 (66,711)
NET INCOME (LOSS) PER UNIT
Limited Partners 86.20 (93.90)
General Partner 86.20 (93.90)
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Quarters Ended March 31, 1997 and 1996
(Unaudited)
<CAPTION>
Units of
Partnership Limited General
Interest Partners Partner Total
<S> <C> <C> <C> <C>
Partners' Capital,
December 31, 1995 47,493.963 $52,842,505 $802,414 $53,644,919
Net Loss - (4,324,431) (66,711) (4,391,142)
Redemptions (3,099.621) (3,278,755) - (3,278,755)
Partners' Capital,
March 31, 1996 44,394.342 $45,239,319 $735,703 $45,975,022
Partners' Capital,
December 31, 1996 38,144.001 $43,960,184 $834,270 $44,794,454
Net Income - 3,281,790 61,237 3,343,027
Redemptions (1,072.207) (1,406,598) - (1,406,598)
Partners' Capital,
March 31, 1997 37,071.794 $45,835,376 $895,507 $46,730,883
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
For the Quarters Ended March 31,
1997 1996
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income (loss) 3,343,027 (4,391,142)
Noncash item included in net income (loss):
Net change in unrealized 1,597,028 (1,002,500)
(Increase) decrease in operating assets:
Interest receivable (DWR) (21,960) 40,288
Receivable from DWR (64,247) 136,640
Increase (decrease) in operating liabilities:
Accrued management fee (DWFCM) 3,819 (19,827)
Accrued administrative expenses 14,823 (64,119)
Accrued brokerage commissions (DWR) 54,843 (86,385)
Accrued transaction fees and costs (2,186) (13,193)
Net cash provided by (used for) operating activities 4,925,147 (5,400,238)
CASH FLOWS FROM FINANCING ACTIVITIES
Decrease in redemptions payable (348,474) (377,827)
Redemptions of units (1,406,598) (3,278,755)
Net cash used for financing activities (1,755,072) (3,656,582)
Net increase (decrease) in cash 3,170,075 (9,056,820)
Balance at beginning of period 44,917,336 53,843,646
Balance at end of period 48,087,411 44,786,826
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
The financial statements include, in the opinion of management,
all adjustments necessary for a fair presentation of the results
of operations and financial condition. The financial statements
and condensed notes, herein should be read in conjunction with
the Partnership's December 31, 1996 Annual Report on Form 10K.
1. Organization
DWFCM International Access Fund L.P. (the "Partnership") is a
limited partnership organized to engage in speculative trading of
futures contracts and forward contracts, and options on futures
contracts and physical commodities, and other commodity
interests. The general partner for the Partnership is Demeter
Management Corporation ("Demeter"). The commodity broker is Dean
Witter Reynolds Inc. ("DWR"). The trading manager is Dean Witter
Futures & Currency Management Inc. ("DWFCM"). Demeter, DWFCM and
DWR are wholly owned subsidiaries of Dean Witter, Discover & Co.
("DWD").
<PAGE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
2. Related Party Transactions
The Partnership's cash is on deposit with DWR in commodity
trading accounts to meet margin requirements as needed. DWR pays
interest on these funds based on current 13-week U.S. Treasury
Bill rates. Brokerage expenses incurred by the Partnership are
paid to DWR. Management and incentive fees incurred by the
Partnership are paid to DWFCM.
3. Financial Instruments
The Partnership trades futures and forward contracts in interest
rates, stock indices, commodities, currencies, petroleum and
precious metals. Futures and forwards represent contracts for
delayed delivery of an instrument at a specified date and price.
Risk arises from changes in the value of these contracts and the
potential inability of counterparties to perform under the terms
of the contracts. There are numerous factors which may
significantly influence the market value of these contracts,
including interest rate volatility. At March 31, 1997 and
December 31, 1996, open contracts were:
<PAGE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Contract or Notional Amount
March 31, 1997 December 31, 1996
$ $
Exchange Traded Contracts
Financial Futures:
Commitments to Sell 119,598,000 -
Commodity Futures:
Commitments to Purchase 932,000 4,997,000
Commitments to Sell 7,975,000 6,129,000
Foreign Futures:
Commitments to Purchase 26,876,000 52,700,000
Commitments to Sell 142,347,000 64,893,000
Off Exchange Traded
Forward Currency Contracts
Commitments to Purchase 162,243,000 181,503,000
Commitments to Sell 192,120,000 205,068,000
A portion of the amounts indicated as off-balance-sheet risk in
forward currency contracts is due to offsetting forward
commitments to purchase and to sell the same currency on the same
date in the future. These commitments are economically offset in
the forward market until the settlement date.
The net unrealized gain (loss) on open contracts is reported as a
component of "Equity in Commodity futures trading accounts" on
the Statement of Financial Condition and totaled $(974,234) and
$622,794 at March 31, 1997 and December 31, 1996, respectively.
Of the $974,234 net unrealized loss on open contracts at March
31, 1997, $1,152,191 related to exchange-traded futures
contracts.
<PAGE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
and $(2,126,425) related to off-exchange-traded forward currency
contracts. Of the $622,794 net unrealized gain on open contracts
at December 31, 1996, $881,994 related to exchange-traded futures
contracts and $(259,200) related to off-exchange-traded forward
currency contracts.
Exchange-traded futures contracts held by the Partnership at
March 31, 1997 and December 31, 1996, mature through December
1997 and June 1997, respectively. Off-exchange-traded forward
currency contracts held at March 31, 1997 and December 31, 1996,
mature through May 1997 and February 1997, respectively. The
contract amounts in the above table represent the Partnership's
extent of involvement in the particular class of financial
instrument, but not the credit risk associated with counterparty
nonperformance. The credit risk associated with these
instruments is limited to the amounts reflected in the
Partnership's Statements of Financial Condition.
The Partnership also has credit risk because DWR acts as the
futures commission merchant or the sole counterparty, with
respect to most of the Partnership's assets. Exchange-traded
futures contracts are marked to market on a daily basis, with
variations
<PAGE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
in value settled on a daily basis. DWR, as the futures
commission merchant for all of the Partnership's exchange-traded
futures contracts, is required pursuant to regulations of the
Commodity Futures Trading Commission to segregate from its own
assets and for the sole benefit of its commodity customers all
funds held by DWR with respect to exchange-traded futures
contracts including an amount equal to the net unrealized gain on
all open futures contracts which funds totaled $49,239,602 and
$45,799,330 at March 31, 1997 and December 31, 1996,
respectively. With respect to those off-exchange-traded forward
currency contracts, the Partnership is at risk to the ability of
DWR, the sole counterparty on all such contracts, to perform.
For the quarter ended March 31, 1997 and the year ended December
31, 1996, the average fair value of financial instruments held
for trading purposes was as follows:
<PAGE>
DWFCM INTERNATIONAL ACCESS FUND L.P.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
March 1997
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 1,972,000 52,271,000
Commodity Futures 2,407,000 8,101,018
Foreign Futures 97,570,000 56,160,000
Off-Exchange-Traded Forward
Currency Contracts 152,902,000 191,561,000
December 1996
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 32,533,000 14,853,000
Commodity Futures 7,299,000 5,251,000
Foreign Futures 116,399,000 43,410,000
Off-Exchange-Traded Forward
Currency Contracts 261,668,000 261,020,000
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - The Partnership's assets are on deposit in separate
commodity interest trading accounts with DWR, and are used by the
Partnership as margin to engage in commodity futures, forward
contracts on foreign currencies and other commodity interest
trading. DWR holds such assets in either designated depositories
or in securities approved by the Commodity Futures Trading
Commission for investment of customer funds. The Partnership's
assets held by DWR may be used as margin solely for the
Partnership's trading. Since the Partnership's sole purpose is
to trade in commodity futures contracts, forward contracts on
foreign currencies and other commodity interests, it is expected
that the Partnership will continue to own such liquid assets for
margin purposes.
The Partnership's investment in commodity futures forward
contracts and other commodity interests may be illiquid. If the
price of the futures contract for a particular commodity has
increased or decreased by an amount equal to the "daily limit",
positions in the commodity can neither be taken nor liquidated
unless traders are willing to effect trades at or within the
<PAGE>
limit. Commodity futures prices have occasionally moved the
daily limit for several consecutive days with little or no
trading. Such market conditions could prevent the Partnership
from promptly liquidating its commodity futures positions.
There is no limitation on daily price moves in trading forward
contracts on foreign currencies. The markets for some world
currencies have low trading volume and are illiquid, which may
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets and subjecting it to
substantial losses. Either of these market conditions could
result in restrictions on redemptions.
Capital Resources. The Partnership does not have, nor does it
expect to have, any capital assets. Redemptions of additional
Units in the future will impact the amount of funds available for
investments in commodity futures and other commodity interests.
As redemptions are at the discretion of Limited Partners, it is
not possible to estimate the amount and therefore, the impact of
future redemptions.
<PAGE>
Results of Operations
For the Quarter Ended March 31, 1997
For the quarter ended March 31, 1997, the Partnership's total
trading revenues including interest income were $4,652,168.
During the first quarter, the Partnership posted an increase in
Net Asset Value per Unit. The most significant trading gains
were recorded in the currency markets as a result of a
strengthening in the value of the U.S. dollar versus most major
European currencies and the Japanese yen during January and
February. Smaller currency gains were recorded from short
positions in the Spanish peseta, Swedish krona and Danish krone.
A portion of these gains was offset by losses from transactions
involving the British pound, as well as the Canadian and
Australian dollars, during March. Gains were recorded in the
metals markets from long base metals futures positions as zinc
and copper prices trended higher during the quarter. Smaller
gains were recorded in the metals markets from short gold futures
positions as gold prices, which began trending lower during late
1996, continued to trend lower in January. A portion of the
Partnership's overall gains for the first quarter was offset by
losses resulting from short-term volatile price movement in
global interest rate and energy futures. Total expenses for the
period were $1,309,141, generating
<PAGE>
net income of $3,343,027. The value of an individual Unit in the
Partnership increased from $1,174.35 at December 31, 1996 to
$1,260.55 at March 31, 1997.
For the Quarter Ended March 31, 1996
For the quarter ended March 31, 1996, the Partnership's total
trading losses net of interest income were $2,795,481. During
the first quarter, the Partnership posted a decrease in Net Asset
Value per Unit. The most significant trading losses were
recorded in the energy markets. In January, losses were
experienced from long oil and gas futures positions as energy
prices reversed from a previous upward move. Losses experienced
in February as oil and gas prices moved in a short-term volatile
pattern were mitigated in March as oil prices moved higher and
long positions in crude, gas and heating oil futures profited.
Additional trading losses were recorded in the currency markets
as a reversal in the downward move of the Japanese yen and most
European currencies during February resulted in losses for
previously established short Japanese yen, German mark and Swiss
franc positions. However, these losses were partially offset by
gains experienced in January from short Japanese yen and European
currency positions and in March from long Australian dollar
positions. In the
<PAGE>
financial futures markets, losses were recorded in February as a
result of a dramatic reversal in the previous upward move in
global interest rate futures prices. These losses more than
offset gains experienced in January from long global interest
rate and stock index futures positions as prices trended higher.
Smaller losses were recorded in the soft commodities and metals
markets as prices were trendless throughout the quarter. Total
expenses for the quarter were $1,595,661, resulting in a net loss
of $4,391,142. The value of an individual Unit in the
Partnership decreased from $1,129.51 at December 31, 1995 to
$1,035.61 at March 31, 1996.
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
On September 6, 10, and 20, 1996, and on March 13, 1997, similar
purported class actions were filed in the Superior Court of the
State of California, County of Los Angeles, on behalf of all
purchasers of interests in limited partnership commodity pools
sold by DWR. Named defendants include DWR, Demeter, DWFCM, DWD
(all such parties referred to hereafter as the "Dean Witter
Parties"), certain limited partnership commodity pools of which
Demeter is the general partner, and certain trading advisors to
those pools. Similar purported class actions were also filed on
September 18 and 20, 1996 in the Supreme Court of the State of
New York, New York County, and on November 14, 1996 in the
Superior Court of the State of Delaware, New Castle County,
against the Dean Witter Parties and certain trading advisors on
behalf of all purchasers of interests in various limited
partnership commodity pools sold by DWR. Generally, these
complaints allege, among other things, that the defendants
committed fraud, deceit, misrepresentation, breach of fiduciary
duty, fraudulent and unfair business practices, unjust
enrichment, and conversion in connection with the sale and
operation of the various limited partnership commodity pools.
The complaints seek unspecified
<PAGE>
amounts of compensatory and punitive damages and other relief.
It is possible that additional similar actions may be filed and
that, in the course of these actions, other parties could be
added as defendants. The Dean Witter Parties believe that they
have strong defenses to, and they will vigorously contest, the
actions. Although the ultimate outcome of legal proceedings
cannot be predicted with certainty, it is the opinion of
management of the Dean Witter Parties that the resolution of the
actions will not have a material adverse effect on the financial
condition or the results of operations of any of the Dean Witter
Parties.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(A) Exhibits - None.
(B) Reports on Form 8-K. - None.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
DWFCM International Access Fund
L.P. (Registrant)
By: Demeter Management Corporation
(General Partner)
May 9, 1997 By: /s/ Patti L. Behnke
Patti L. Behnke
Chief Financial Officer
The General Partner which signed the above is the only party
authorized to act for the Registrant. The Registrant has no
principal executive officer, principal financial officer,
controller, or principal accounting officer and has no Board of
Directors.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from
DWFCM International Access Fund L.P. and is qualified in its entirety
by reference to such financial instruments.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 48,087,411
<SECURITIES> 0
<RECEIVABLES> 276,926<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 47,390,103<F2>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 47,390,103<F3>
<SALES> 0
<TOTAL-REVENUES> 4,652,168<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,309,141
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,343,027
<INCOME-TAX> 0
<INCOME-CONTINUING> 3,343,027
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,343,027
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Receivables include interest receivable of $174,153 and receivable
from DWR of $102,773.
<F2>In addition to cash and receivables, total assets include net unrealized
loss on open contracts of $974,234.
<F3>Liabilities include redemptions payable of $300,946, accrued brokerage
commissions of $114,474, accrued management fees of $117,617, accrued
administrative expenses payable of $114,943 and accrued transaction
fees and costs of $11,240.
<F4>Total revenues include realized trading revenue of $5,772,900, net change
in unrealized of $(1,597,028) and interest income of $476,296.
</FN>
</TABLE>
