<PAGE> 1
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
Two World Trade Center, New York, New York 10048
LETTER TO THE SHAREHOLDERS February 28, 1999
DEAR SHAREHOLDER:
As of February 28, 1999, Morgan Stanley Dean Witter Liquid Asset Fund's net
assets exceeded $17 billion, up 24 percent from one year earlier. The
portfolio's average life was 78 days at the end of February and its annualized
net investment income for the six-month period ended February 28 was 4.78
percent, while its 30-day moving average yield was 4.54 percent.
MARKET OVERVIEW
The U.S. economy maintained a healthy expansion over the course of the past six
months as employment grew, income climbed and consumer confidence soared.
Despite strong economic growth, however, inflation did not materialize, due
largely to the continued turmoil in the Asian and emerging market economies. In
late September, in order to try to ensure continued U.S. economic growth,
members of the Federal Open Market Committee voted to reduce short-term rates
and did so again in mid-October and mid-November. Through the end of the fiscal
year the powerful U.S. economy continued to benefit from substantial economic
expansion, with only moderate inflation and low levels of unemployment.
PORTFOLIO COMPOSITION, STRUCTURE AND PERFORMANCE
On February 28, 1999, approximately 51 percent of the Fund's portfolio was
invested in high-quality commercial paper, 37 percent in U.S. federal agency
discount notes and 12 percent in the short-term bank notes and negotiable
certificates of deposit of financially strong commercial banks. At the end of
February, approximately 82 percent of the Fund's holdings were due to mature in
less than four months. Therefore, we believe the Fund is well positioned for
stability of principal with a very high degree of liquidity.
The Fund has produced net yields above its peer group averages during recent
years, aided in part by its well-above-average size and competitive expense
structure. As always, we try to operate the Fund in a conservative style without
the use of derivatives or structured notes,
<PAGE> 2
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
LETTER TO THE SHAREHOLDERS February 28, 1999, continued
which might fluctuate excessively as interest rates change. The Fund continues
to serve as a useful investment for liquidity, preservation of capital and a
yield that reflects prevailing money market conditions.
LOOKING AHEAD
We anticipate a slight moderation in the pace of economic activity later in 1999
with no major adverse surprises in the rate of inflation. Investment yields
available to the Fund early in 1999 are likely to be somewhat lower than the
averages achieved during the past several months.
We appreciate your ongoing support of Morgan Stanley Dean Witter Liquid Asset
Fund and look forward to continuing to serve your investment needs and
objectives.
Very truly yours,
/S/ CHARLES A. FIUMEFREDDO
CHARLES A. FIUMEFREDDO
Chairman of the Board
2
<PAGE> 3
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
PORTFOLIO OF INVESTMENTS February 28, 1999 (unaudited)
<TABLE>
<CAPTION>
ANNUALIZED
PRINCIPAL YIELD ON
AMOUNT IN DATE OF MATURITY
THOUSANDS PURCHASE DATE VALUE
- -------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
COMMERCIAL PAPER (51.9%)
Banking (5.7%)
$ 300,000 Bank One Corp. ........................................ 4.89 - 5.15% 03/30/99 - 06/29/99 $ 297,468,164
250,000 Bankers Trust Corp. ................................... 5.68 - 5.73 03/01/99 - 03/26/99 249,651,740
420,000 Wells Fargo & Co. ..................................... 4.87 - 5.12 04/09/99 - 05/12/99 417,059,875
---------------
964,179,779
---------------
Construction/Agricultural Equipment/Trucks (0.3%)
50,000 Deere (John) Capital Corp. ............................ 4.85 04/06/99 49,746,139
---------------
Consumer Sundries (0.4%)
70,000 Procter & Gamble Co. .................................. 4.85 03/19/99 69,813,333
---------------
Diversified Financial Services (9.0%)
725,000 Associates Corp. of North America...................... 4.84 - 5.08 04/20/99 - 06/17/99 717,318,167
836,000 General Electric Capital Corp. ........................ 4.85 - 5.69 03/04/99 - 11/15/99 823,352,127
---------------
1,540,670,294
---------------
Finance - Automotive (14.2%)
602,000 Chrysler Financial Co. L.L.C. ......................... 4.85 - 5.16 03/01/99 - 07/09/99 599,166,834
200,000 DaimlerChrysler N.A. Holding Corp. .................... 5.12 - 5.24 03/03/99 - 03/25/99 199,578,056
804,000 Ford Motor Credit Co. ................................. 4.82 - 5.11 03/25/99 - 06/03/99 797,070,915
825,000 General Motors Acceptance Corp. ....................... 4.85 - 4.88 04/23/99 - 05/19/99 817,799,411
---------------
2,413,615,216
---------------
Finance - Consumer (4.4%)
435,000 American Express Credit Corp. ......................... 4.81 - 5.58 03/18/99 - 05/21/99 432,126,400
35,000 Household Finance Corp. ............................... 4.83 03/19/99 34,906,472
290,000 New Center Asset Trust................................. 4.88 - 4.92 05/24/99 - 05/28/99 286,565,950
---------------
753,598,822
---------------
Finance - Corporate (2.7%)
215,000 CIT Group, Inc. ....................................... 4.88 - 5.01 03/24/99 - 06/10/99 213,706,486
250,000 Ciesco, L.P. .......................................... 4.86 - 4.89 05/13/99 - 06/07/99 247,118,805
---------------
460,825,291
---------------
International Banks (14.1%)
300,000 ABN-AMRO North America Finance Inc. ................... 4.87 - 5.69 03/03/99 - 06/09/99 296,569,667
450,000 Abbey National North America Corp. .................... 4.85 - 4.88 05/03/99 - 05/06/99 446,014,250
150,000 Commerzbank U.S. Finance Inc. ......................... 4.84 04/01/99 149,340,000
595,000 Deutsche Bank Financial Inc. .......................... 4.88 - 4.94 03/18/99 - 04/29/99 590,896,653
35,000 Dresdner U.S. Finance Inc. ............................ 4.87 03/02/99 34,985,839
745,000 Societe Generale N.A., Inc. ........................... 4.86 - 4.94 03/10/99 - 04/27/99 742,324,416
140,000 UBS Finance (DE) Inc. ................................. 4.89 04/07/99 - 04/08/99 139,260,742
---------------
2,399,391,567
---------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE> 4
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
PORTFOLIO OF INVESTMENTS February 28, 1999 (unaudited) continued
<TABLE>
<CAPTION>
ANNUALIZED
PRINCIPAL YIELD ON
AMOUNT IN DATE OF MATURITY
THOUSANDS PURCHASE DATE VALUE
- -------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Retail (1.1%)
$ 185,000 Sears Roebuck Acceptance Corp. ........................ 4.87 - 4.93% 03/02/99 - 05/27/99 $ 183,252,257
---------------
TOTAL COMMERCIAL PAPER (Amortized Cost $8,835,092,698).................................... 8,835,092,698
---------------
U.S. GOVERNMENT AGENCIES (36.9%)
100,000 Federal Farm Credit Bank............................... 4.88 - 4.89 12/23/99 - 02/11/00 95,810,152
1,295,000 Federal Home Loan Banks................................ 4.66 - 5.52 03/22/99 - 02/17/00 1,274,422,236
1,980,000 Federal Home Loan Mortgage Corp. ...................... 4.71 - 5.06 03/05/99 - 07/29/99 1,965,798,614
3,000,000 Federal National Mortgage Assoc. ...................... 4.69 - 5.55 03/04/99 - 02/04/00 2,952,522,011
---------------
TOTAL U.S. GOVERNMENT AGENCIES (Amortized Cost $6,288,553,013)............................ 6,288,553,013
---------------
SHORT-TERM BANK NOTES (7.7%)
435,000 FCC National Bank...................................... 4.89 - 5.10 03/29/99 - 06/30/99 435,000,000
200,000 First Union National Bank.............................. 5.22 03/30/99 200,000,000
145,000 Mellon Bank, N.A. ..................................... 4.88 05/17/99 - 06/29/99 145,000,000
375,000 NationsBank, N.A. ..................................... 4.88 - 5.12 03/11/99 - 06/28/99 375,000,000
150,000 Wachovia Bank, N.A. ................................... 4.85 - 4.95 08/06/99 - 08/23/99 150,000,000
---------------
TOTAL SHORT-TERM BANK NOTES (Amortized Cost $1,305,000,000)............................... 1,305,000,000
---------------
CERTIFICATES OF DEPOSIT (4.4%)
50,000 Chase Manhattan Bank (USA)............................. 4.95 07/12/99 50,000,000
45,000 First Tennessee Bank N.A. ............................. 4.86 03/23/99 45,000,000
100,000 Harris Trust & Savings Bank............................ 4.84 03/25/99 100,000,000
400,000 Morgan Guaranty Trust Co. of New York.................. 4.92 - 5.12 03/10/99 - 03/17/99 400,000,000
150,000 U.S. Bank, N.A. ....................................... 4.85 - 4.92 05/24/99 - 07/08/99 150,000,000
---------------
TOTAL CERTIFICATES OF DEPOSIT (Amortized Cost $745,000,000)............................... 745,000,000
---------------
REPURCHASE AGREEMENT (0.1%)
15,197 The Bank of New York (dated 02/26/99; proceeds
$15,202,963) (a) (Identified Cost $15,196,948)........ 4.75 03/01/99 15,196,948
---------------
TOTAL INVESTMENTS (Amortized Cost $17,188,842,659)(b)............................. 101.0% 17,188,842,659
LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS.................................... (1.0) (167,024,013)
------ ---------------
NET ASSETS........................................................................ 100.0% $17,021,818,646
====== ===============
</TABLE>
- ---------------------
(a) Collateralized by $14,863,223 U.S. Treasury Note 6.50% due 05/31/01 valued
at $15,500,887.
(b) Cost is the same for federal income tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE> 5
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
February 28, 1999 (unaudited)
<S> <C>
ASSETS:
Investments in securities, at value
(amortized cost $17,188,842,659)..... $17,188,842,659
Cash.................................. 90,000
Receivable for:
Interest.......................... 13,254,847
Capital stock sold................ 27,452
Prepaid expenses and other assets..... 888,837
---------------
TOTAL ASSETS...................... 17,203,103,795
---------------
LIABILITIES:
Payable for:
Capital stock repurchased......... 175,560,622
Investment management fee......... 3,524,223
Plan of distribution fee.......... 1,320,230
Accrued expenses and other payables... 880,074
---------------
TOTAL LIABILITIES................. 181,285,149
---------------
NET ASSETS........................ $17,021,818,646
===============
COMPOSITION OF NET ASSETS:
Paid-in-capital....................... $17,021,127,809
Accumulated undistributed net
investment income.................... 690,837
---------------
NET ASSETS........................ $17,021,818,646
===============
NET ASSET VALUE PER SHARE,
17,021,799,003 shares outstanding
(25,000,000,000 shares authorized of
$.01 par value)...................... $1.00
===============
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
For the six months ended February 28, 1999 (unaudited)
<S> <C>
NET INVESTMENT INCOME:
INTEREST INCOME.......................... $434,871,853
------------
EXPENSES
Investment management fee................ 21,666,172
Transfer agent fees and expenses......... 17,087,927
Plan of distribution fee................. 7,660,585
Registration fees........................ 768,468
Shareholder reports and notices.......... 374,237
Custodian fees........................... 173,529
Professional fees........................ 25,324
Directors' fees and expenses............. 9,000
Other.................................... 67,145
------------
TOTAL EXPENSES....................... 47,832,387
------------
NET INVESTMENT INCOME................ 387,039,466
NET REALIZED GAIN.................... 63,931
------------
NET INCREASE............................. $387,103,397
============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE> 6
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
FINANCIAL STATEMENTS, continued
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
FEBRUARY 28, 1999 AUGUST 31, 1998
- ---------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income............................. $ 387,039,466 $ 717,140,194
Net realized gain................................. 63,931 22,513
--------------- ---------------
NET INCREASE.................................. 387,103,397 717,162,707
--------------- ---------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income............................. (387,041,325) (717,132,845)
Net realized gain................................. (63,931) (22,513)
--------------- ---------------
TOTAL DIVIDENDS AND DISTRIBUTIONS............. (387,105,256) (717,155,358)
--------------- ---------------
Net increase from capital stock transactions...... 1,700,466,900 2,155,436,091
--------------- ---------------
NET INCREASE.................................. 1,700,465,041 2,155,443,440
NET ASSETS:
Beginning of period............................... 15,321,353,605 13,165,910,165
--------------- ---------------
END OF PERIOD
(Including undistributed net investment income
of $690,837 and $692,696, respectively)....... $17,021,818,646 $15,321,353,605
=============== ===============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE> 7
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 28, 1999 (unaudited)
1. ORGANIZATION AND ACCOUNTING POLICIES
Morgan Stanley Dean Witter Liquid Asset Fund Inc. (the "Fund") is registered
under the Investment Company Act of 1940, as amended (the "Act"), as a
diversified, open-end management investment company. The Fund's investment
objectives are high current income, preservation of capital and liquidity. The
Fund was incorporated in Maryland on September 3, 1974 and commenced operations
on September 22, 1975.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures. Actual results could differ from
those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- Portfolio securities are valued at amortized
cost, which approximates market value.
B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Discounts are accreted and premiums are amortized over the life of the
respective securities. Interest income is accrued daily.
C. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends and
distributions as of the close of each business day.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement with Morgan Stanley Dean Witter
Advisors Inc. (the "Investment Manager"), the Fund pays the Investment Manager a
management fee, accrued daily and payable monthly, by applying the following
annual rates to the net assets of the Fund determined as of the close of each
business day: 0.50% to the portion of the daily net assets not exceeding $500
million; 0.425% to the portion of the daily net assets exceeding $500 million
but not exceeding $750 million; 0.375% to the portion of the daily net assets
exceeding $750 million but not exceeding
7
<PAGE> 8
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 28, 1999 (unaudited) continued
$1 billion; 0.35% to the portion of the daily net assets exceeding $1 billion
but not exceeding $1.35 billion; 0.325% to the portion of the daily net assets
exceeding $1.35 billion but not exceeding $1.75 billion; 0.30% to the portion of
the daily net assets exceeding $1.75 billion but not exceeding $2.15 billion;
0.275% to the portion of the daily net assets exceeding $2.15 billion but not
exceeding $2.5 billion; 0.25% to the portion of the daily net assets exceeding
$2.5 billion but not exceeding $15 billion; 0.249% to the portion of the daily
net assets exceeding $15 billion but not exceeding $17.5 billion; and 0.248% to
the portion of the daily net assets exceeding $17.5 billion.
Under the terms of the Agreement, the Investment Manager maintains certain of
the Fund's books and records and furnishes, at its own expense, office space,
facilities, equipment, clerical, bookkeeping and certain legal services and pays
the salaries of all personnel, including officers of the Fund who are employees
of the Investment Manager. The Investment Manager also bears the cost of
telephone services, heat, light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION
Morgan Stanley Dean Witter Distributors Inc. (the "Distributor"), an affiliate
of the Investment Manager, is the distributor of the Fund's shares and, in
accordance with a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under
the Act, finances certain expenses in connection therewith.
Under the Plan, the Distributor bears the expense of all promotional and
distribution related activities on behalf of the Fund, except for expenses that
the Directors determine to reimburse, as described below. The following
activities and services may be provided by the Distributor, Dean Witter Reynolds
Inc. ("DWR"), its affiliates and other selected broker-dealers under the Plan:
(1) compensation to, and expenses of, sales representatives and other employees
of DWR and other selected broker-dealers including overhead and telephone
expenses; (2) sales incentives and bonuses to sales representatives and to
marketing personnel in connection with promoting sales of the Fund's shares; (3)
expenses incurred in connection with promoting sales of the Fund's shares; (4)
preparation, printing and distributing sales literature; and (5) providing
advertising and promotional activities, including direct mail solicitation and
television, radio, newspaper, magazine and other media advertisements.
The Fund is authorized to reimburse the Distributor for specific expenses the
Distributor incurs or plans to incur in promoting the distribution of the Fund's
shares. The amount of each monthly reimbursement payment may in no event exceed
an amount equal to a payment at the annual rate of 0.15% of the Fund's average
daily net assets during the month. Expenses incurred by the Distributor
8
<PAGE> 9
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 28, 1999 (unaudited) continued
pursuant to the Plan in any fiscal year will not be reimbursed by the Fund
through payments accrued in any subsequent fiscal year. For the six months ended
February 28, 1999, the distribution fee was accrued at the annual rate of 0.10%.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales/maturities of portfolio securities
for the six months ended February 28, 1999 aggregated $31,864,955,406 and
$30,528,034,784, respectively.
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent.
The Fund has an unfunded noncontributory defined benefit pension plan covering
all independent Directors of the Fund who will have served as independent
Directors for at least five years at the time of retirement. Benefits under this
plan are based on years of service and compensation during the last five years
of service. Aggregate pension costs for the six months ended February 28, 1999
included in Directors' fees and expenses in the Statement of Operations amounted
to $2,961. At February 28, 1999, the Fund had an accrued pension liability of
$51,477 which is included in accrued expenses in the Statement of Assets and
Liabilities.
5. CAPITAL STOCK
Transactions in capital stock, at $1.00 per share, were as follows:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
FEBRUARY 28, 1999 AUGUST 31, 1998
----------------- ---------------
<S> <C> <C>
(unaudited)
Shares sold................................................. 23,747,459,798 43,113,580,761
Shares issued in reinvestment of dividends and
distributions.............................................. 386,232,063 715,431,667
Shares issued in connection with the acquisition of Dean
Witter Retirement Series -- Liquid Asset Series............ 12,732,710 --
--------------- ---------------
24,146,424,571 43,829,012,428
Shares repurchased.......................................... (22,445,957,671) (41,673,576,337)
--------------- ---------------
Net increase................................................ 1,700,466,900 2,155,436,091
=============== ===============
</TABLE>
9
<PAGE> 10
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 28, 1999 (unaudited) continued
6. ACQUISITION OF DEAN WITTER RETIREMENT SERIES -- LIQUID ASSET SERIES
As of the close of business on September 11, 1998, the Fund acquired all the net
assets of Dean Witter Retirement Series -- Liquid Asset Series ("Retirement
Liquid Asset") pursuant to a plan of reorganization approved by the shareholders
of Retirement Liquid Asset on August 19, 1998. The acquisition was accomplished
by a tax-free exchange of 12,732,710 shares of the Fund at a net asset value of
$1.00 per share for 12,732,710 shares of Retirement Liquid Asset. The net assets
of the Fund and Retirement Liquid Asset immediately before the acquisition were
$15,729,214,021 and $12,732,710, respectively. Immediately after the
acquisition, the combined net assets of the Fund amounted to $15,741,946,731.
10
<PAGE> 11
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of capital stock outstanding
throughout each period:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR ENDED AUGUST 31,
MONTHS ENDED ----------------------------------------------------
FEBRUARY 28, 1999 1998 1997 1996 1995 1994
- ---------------------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA:
Net asset value, beginning of period................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- -------
Net investment income from operations.................. 0.024 0.052 0.050 0.050 0.053 0.030
Less dividends from net investment income.............. (0.024) (0.052) (0.050) (0.050) (0.053) (0.030)
------- ------- ------- ------- ------- -------
Net asset value, end of period......................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= =======
TOTAL RETURN........................................... 2.38%(1) 5.29% 5.13% 5.15% 5.41% 3.07%
RATIOS TO AVERAGE NET ASSETS:
Expenses............................................... 0.59%(2) 0.61% 0.62% 0.63% 0.65% 0.70%
Net investment income.................................. 4.78%(2) 5.11% 5.01% 5.02% 5.28% 3.02%
SUPPLEMENTAL DATA:
Net assets, end of period, in millions................. $17,022 $15,321 $13,166 $11,389 $10,359 $8,492
</TABLE>
- ---------------------
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE> 12
BOARD OF DIRECTORS
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
John R. Haire
Wayne E. Hedien
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Barry Fink
Vice President, Secretary and General Counsel
Jonathan R. Page
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Morgan Stanley Dean Witter Trust FSB
Harborside Financial Center -- Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Morgan Stanley Dean Witter Advisors Inc.
Two World Trade Center
New York, New York 10048
The financial statements included herein have been taken from the records of the
Fund without examination by the independent accountants and accordingly they do
not express an opinion thereon.
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and trustees,
fees, expenses and other pertinent information, please see the prospectus of the
Fund.
This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.
MORGAN STANLEY
DEAN WITTER
LIQUID ASSET FUND
[MORGAN STANLEY GRAPHIC]
SEMIANNUAL REPORT
FEBRUARY 28, 1999
