<PAGE> 1
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC. Two World Trade Center
LETTER TO THE SHAREHOLDERS February 29, 2000 New York, New York 10048
DEAR SHAREHOLDER:
As of February 29, 2000, assets in Morgan Stanley Dean Witter Liquid Asset Fund
exceeded $19.2 billion, up 13 percent from a year earlier. The portfolio's
average life was 76 days at the end of February, its annualized net investment
income ratio for the six-month period ended February 29 was 5.16 percent and its
annualized 30-day moving average yield was 5.44 percent.
MARKET OVERVIEW
During the six-month period ended February 29, 2000, the U.S. economy continued
to display sustained strength propelled by gains in work force productivity,
relatively low inflation and unemployment and recoveries in many overseas
economies. In an effort to avoid increased inflationary pressures and an
excessive pace of economic expansion, the Federal Reserve Board raised its key
federal funds target rate in four steps from 4.75 percent to 5.75 percent
between June 1999 and February 2000. Subsequently, on March 21, 2000, the
federal funds rate was raised an additional 25 basis points to 6.00 percent. As
a result of the Fed's actions, investment rates available from money-market
securities were higher during the six-month period just ended than in the
previous six-month period. Accordingly, the net yield provided by the Fund has
been in a generally rising pattern from late June 1999 through February 2000.
PORTFOLIO COMPOSITION AND STRUCTURE
On February 29, 2000, approximately 77 percent of the Fund's portfolio was
invested in high-quality commercial paper, 18 percent in federal agency and U.S.
Treasury obligations, and the remaining 5 percent in short-term bank notes and
certificates of deposit issued by financially strong commercial banks. At the
end of the period, 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 value with a very high degree of liquidity. As
always, we try to operate the Fund in a conservative manner without the use of
derivatives or
<PAGE> 2
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
LETTER TO THE SHAREHOLDERS February 29, 2000, continued
structured notes, which might fluctuate excessively with changing interest
rates. We believe that 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
While we anticipate some moderation in the pace of economic activity during the
year ahead, we expect that the economy's growth rate could remain stronger than
the Federal Reserve Board believes desirable over the long run. As a result,
future meetings of the Federal Open Market Committee may result in further
upward adjustments for short-term interest rates.
We appreciate your ongoing support of Morgan Stanley Dean Witter Liquid Asset
Fund and look forward to continuing to serve your investment needs.
<TABLE>
<S> <C>
Very truly yours,
/s/ CHARLES A. FIUMEFREDDO /s/ MITCHELL M. MERIN
CHARLES A. FIUMEFREDDO MITCHELL M. MERIN
Chairman of the Board President
</TABLE>
2
<PAGE> 3
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
PORTFOLIO OF INVESTMENTS February 29, 2000 (unaudited)
<TABLE>
<CAPTION>
ANNUALIZED
PRINCIPAL YIELD ON
AMOUNT IN DATE OF MATURITY
THOUSANDS PURCHASE DATE VALUE
- ---------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
COMMERCIAL PAPER (78.2%)
Banking (6.0%)
$ 70,000 Bank of America Corp.................................... 6.00% 03/23/00 $ 69,747,611
200,000 Citicorp................................................ 5.80 - 5.83 03/21/00 - 03/29/00 199,247,222
40,000 Mellon Funding Corp..................................... 6.03 05/30/00 39,407,000
400,000 Morgan (J.P.) & Co. Inc................................. 5.92 - 6.00 03/31/00 - 04/10/00 397,559,417
120,000 Wachovia Corp........................................... 5.55 - 6.14 03/01/00 - 07/28/00 118,270,358
335,000 Wells Fargo & Co........................................ 5.89 - 6.05 03/31/00 - 04/25/00 332,666,500
---------------
1,156,898,108
---------------
Computer Hardware (1.0%)
200,000 IBM Credit Corp......................................... 5.81 03/29/00 199,104,000
---------------
Diversified Financial Services (7.0%)
390,000 Associates First Capital Corp........................... 5.77 - 5.97 03/08/00 - 05/17/00 387,340,086
975,000 General Electric Capital Corp........................... 5.51 - 6.34 03/02/00 - 11/02/00 956,115,889
---------------
1,343,455,975
---------------
Finance - Automotive (13.5%)
840,000 DaimlerChrysler North America Holding Corp.............. 5.90 - 6.08 03/07/00 - 05/19/00 833,234,722
930,000 Ford Motor Credit Co.................................... 5.71 - 5.92 03/02/00 - 04/25/00 925,925,570
835,000 General Motors Acceptance Corp.......................... 5.76 - 5.80 03/03/00 - 03/23/00 832,975,611
---------------
2,592,135,903
---------------
Finance - Consumer (6.6%)
580,000 American Express Credit Corp............................ 5.82 - 5.88 03/24/00 - 04/12/00 577,438,467
700,000 New Center Asset Trust.................................. 5.77 - 5.96 03/06/00 - 05/08/00 696,349,875
---------------
1,273,788,342
---------------
Finance - Corporate (5.3%)
380,000 CIT Group Inc. (The).................................... 5.76 - 6.01 03/14/00 - 05/31/00 377,266,644
650,000 Ciesco, L.P............................................. 5.83 - 6.00 03/08/00 - 05/26/00 645,737,631
---------------
1,023,004,275
---------------
International Banks (31.3%)
100,000 ANZ (DE) Inc............................................ 6.08 03/28/00 99,551,500
750,000 Abbey National North America Corp....................... 5.91 - 6.01 03/06/00 - 04/27/00 745,515,597
900,000 Barclays U.S. Funding Corp.............................. 5.81 - 5.83 03/21/00 - 04/05/00 896,251,778
250,000 Canadian Imperial Holdings Inc.......................... 6.01 05/31/00 246,265,208
150,000 CBA (Delaware) Finance Inc.............................. 6.10 03/17/00 149,599,333
245,000 Cregem North America Inc................................ 5.92 - 6.05 03/01/00 - 04/20/00 243,846,111
858,000 Deutsche Bank Financial Inc............................. 5.77 - 6.06 03/23/00 - 06/01/00 851,784,126
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE> 4
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
PORTFOLIO OF INVESTMENTS February 29, 2000 (unaudited) continued
<TABLE>
<CAPTION>
ANNUALIZED
PRINCIPAL YIELD ON
AMOUNT IN DATE OF MATURITY
THOUSANDS PURCHASE DATE VALUE
- ---------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
$ 510,000 Dresdner U.S. Finance Inc............................... 5.80 - 5.98% 03/10/00 - 05/11/00 $ 506,563,792
400,000 Internationale Nederlanden (U.S.) Funding Corp.......... 6.01 - 6.05 03/13/00 - 03/24/00 398,895,500
135,000 KFW International Finance Inc........................... 5.95 04/05/00 134,234,813
940,000 Societe Generale N.A. Inc............................... 5.81 - 6.11 03/24/00 - 05/24/00 931,496,257
570,000 Toronto-Dominion Holdings (USA) Inc..................... 5.78 - 6.00 03/15/00 - 04/19/00 567,038,467
255,000 UBS Finance (Delaware) LLC.............................. 6.19 - 6.22 09/28/00 - 09/29/00 246,113,464
---------------
6,017,155,946
---------------
Investment Bankers/Brokers/Services (4.4%)
855,000 Goldman Sachs Group Inc................................. 5.80 - 6.25 03/07/00 - 04/28/00 850,207,792
---------------
Major Chemicals (0.5%)
100,000 Dupont (E.I.) De Nemours & Co........................... 5.96 05/17/00 98,746,611
---------------
Major U.S. Telecommunications (2.6%)
500,000 AT&T Corp............................................... 5.93 05/04/00 - 05/05/00 494,768,333
---------------
TOTAL COMMERCIAL PAPER (Amortized Cost $15,049,265,285)...................................... 15,049,265,285
---------------
U.S. GOVERNMENT & AGENCY OBLIGATIONS (18.2%)
190,000 Federal Farm Credit Banks............................... 5.94 - 6.26 10/24/00 - 01/02/01 182,001,661
773,000 Federal Home Loan Banks................................. 4.90 - 6.22 03/31/00 - 12/29/00 740,924,981
900,000 Federal Home Loan Mortgage Corp......................... 5.54 - 6.50 03/16/00 - 02/01/01 873,877,461
1,462,000 Federal National Mortgage Assoc......................... 4.91 - 6.45 03/20/00 - 01/26/01 1,411,340,593
300,000 U.S. Treasury Bills..................................... 5.75 - 5.92 04/27/00 - 12/07/00 295,559,170
---------------
TOTAL U.S. GOVERNMENT & AGENCY OBLIGATIONS (Amortized Cost $3,503,703,866)................... 3,503,703,866
---------------
SHORT-TERM BANK NOTES (4.8%)
720,000 Bank of America, N.A.................................... 5.87 - 6.00 03/22/00 - 05/30/00 720,000,000
150,000 Bank One, N.A........................................... 5.97 03/03/00 150,000,000
50,000 First USA Bank, N.A..................................... 5.97 03/01/00 50,000,000
---------------
TOTAL SHORT-TERM BANK NOTES (Amortized Cost $920,000,000).................................... 920,000,000
---------------
CERTIFICATE OF DEPOSIT (0.5%)
100,000 U.S. Bank, N.A. (Amortized Cost $100,000,000)........... 6.04 04/17/00 100,000,000
---------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE> 5
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
PORTFOLIO OF INVESTMENTS February 29, 2000 (unaudited) continued
<TABLE>
<CAPTION>
ANNUALIZED
PRINCIPAL YIELD ON
AMOUNT IN DATE OF MATURITY
THOUSANDS PURCHASE DATE VALUE
- ---------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
REPURCHASE AGREEMENT (0.1%)
$ 8,917 The Bank of New York (dated 02/29/00; proceeds
$8,918,044) (a) (Identified Cost $8,916,635)........... 5.688% 03/01/00 $ 8,916,635
---------------
TOTAL INVESTMENTS (Amortized Cost $19,581,885,786) (b)........................... 101.8%
19,581,885,786
LIABILITIES IN EXCESS OF OTHER ASSETS............................................... (1.8) (353,912,444)
------- ---------------
NET ASSETS......................................................................... 100.0% $19,227,973,342
======= ===============
</TABLE>
- ---------------------
(a) Collateralized by $8,542,890 Federal Home Loan Mortgage Corp. 6.643% due
03/15/25 valued at $8,586,618 and $508,382 U.S. Treasury Bill 5.64% due
06/01/00 valued at $508,382.
(b) Cost is the same for federal income tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE> 6
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
FINANCIAL STATEMENTS
<TABLE>
<S> <C>
STATEMENT OF ASSETS AND LIABILITIES
February 29, 2000 (unaudited)
ASSETS:
Investments in securities, at value
(amortized cost $19,581,885,786)........................... $19,581,885,786
Cash........................................................ 90,001
Receivable for:
Interest................................................ 15,432,534
Capital stock sold...................................... 2,572,992
Prepaid expenses and other assets........................... 942,133
---------------
TOTAL ASSETS............................................ 19,600,923,446
---------------
LIABILITIES:
Payable for:
Capital stock repurchased............................... 366,606,371
Investment management fee............................... 4,031,379
Plan of distribution fee................................ 1,521,321
Accrued expenses and other payables......................... 791,033
---------------
TOTAL LIABILITIES....................................... 372,950,104
---------------
NET ASSETS.............................................. $19,227,973,342
===============
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................. $19,227,276,315
Accumulated undistributed net investment income............. 697,027
---------------
NET ASSETS.............................................. $19,227,973,342
===============
NET ASSET VALUE PER SHARE,
19,227,947,509 shares outstanding
(25,000,000,000 shares authorized of $.01 par value)....... $1.00
===============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE> 7
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
FINANCIAL STATEMENTS, continued
<TABLE>
<S> <C>
STATEMENT OF OPERATIONS
For the six months ended February 29, 2000 (unaudited)
NET INVESTMENT INCOME:
INTEREST INCOME............................................. $528,207,665
------------
EXPENSES
Investment management fee................................... 24,366,779
Transfer agent fees and expenses............................ 19,083,618
Plan of distribution fee.................................... 8,576,664
Registration fees........................................... 599,884
Shareholder reports and notices............................. 336,343
Custodian fees.............................................. 207,668
Professional fees........................................... 35,551
Directors' fees and expenses................................ 8,566
Other....................................................... 101,857
------------
TOTAL EXPENSES.......................................... 53,316,930
------------
NET INVESTMENT INCOME................................... 474,890,735
NET REALIZED GAIN....................................... 6,400
------------
NET INCREASE................................................ $474,897,135
============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE> 8
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 29, 2000 AUGUST 31, 1999
- ---------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income............................. $ 474,890,735 $ 784,350,026
Net realized gain................................. 6,400 64,606
--------------- ---------------
NET INCREASE.................................. 474,897,135 784,414,632
--------------- ---------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income............................. (474,880,298) (784,356,132)
Net realized gain................................. (6,400) (64,606)
--------------- ---------------
TOTAL DIVIDENDS AND DISTRIBUTIONS............. (474,886,698) (784,420,738)
--------------- ---------------
Net increase from capital stock transactions...... 1,352,509,602 2,554,105,804
--------------- ---------------
NET INCREASE.................................. 1,352,520,039 2,554,099,698
NET ASSETS:
Beginning of period............................... 17,875,453,303 15,321,353,605
--------------- ---------------
END OF PERIOD
(Including undistributed net investment income
of $697,027 and $686,590, respectively)....... $19,227,973,342 $17,875,453,303
=============== ===============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
8
<PAGE> 9
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 29, 2000 (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
9
<PAGE> 10
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 29, 2000 (unaudited) continued
$750 million; 0.375% to the portion of the daily net assets exceeding $750
million but not exceeding $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
10
<PAGE> 11
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 29, 2000 (unaudited) continued
0.15% of the Fund's average daily net assets during the month. Expenses incurred
by the Distributor 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 29, 2000, the distribution fee was accrued at
the annual rate of 0.09%.
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 29, 2000 aggregated $37,656,183,102 and
$36,616,603,631, respectively.
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At February 29, 2000, the Fund had
transfer agent fees and expenses payable of approximately $62,000.
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 29, 2000
included in Directors' fees and expenses in the Statement of Operations amounted
to $2,996. At February 29, 2000, the Fund had an accrued pension liability of
$52,594 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 29, 2000 AUGUST 31, 1999
----------------- ---------------
(unaudited)
<S> <C> <C>
Shares sold................................................. 31,442,176,508 50,418,894,458
Shares issued in reinvestment of dividends and
distributions.............................................. 473,688,308 782,640,290
Shares issued in connection with the acquisition of Dean
Witter Retirement Series -- Liquid Asset Series............ -- 12,732,710
--------------- ---------------
31,915,864,816 51,214,267,458
Shares repurchased.......................................... (30,563,355,214) (48,660,161,654)
--------------- ---------------
Net increase................................................ 1,352,509,602 2,554,105,804
=============== ===============
</TABLE>
11
<PAGE> 12
MORGAN STANLEY DEAN WITTER LIQUID ASSET FUND INC.
NOTES TO FINANCIAL STATEMENTS February 29, 2000 (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.
12
<PAGE> 13
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 29, 2000 1999 1998 1997 1996 1995
- -------------------------------------------------------------------------------------------------------------------------------
(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................ 0.026 0.046 0.052 0.050 0.050 0.053
Less dividends from net investment income............ (0.026) (0.046) (0.052) (0.050) (0.050) (0.053)
------ ------ ------ ------ ------ ------
Net asset value, end of period....................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ====== ======
TOTAL RETURN......................................... 2.61%(1) 4.74% 5.29% 5.13% 5.15% 5.41%
RATIOS TO AVERAGE NET ASSETS:
Expenses............................................. 0.58%(2) 0.59% 0.61% 0.62% 0.63% 0.65%
Net investment income................................ 5.16%(2) 4.61% 5.11% 5.01% 5.02% 5.28%
SUPPLEMENTAL DATA:
Net assets, end of period, in millions............... $19,228 $17,875 $15,321 $13,166 $11,389 $10,359
</TABLE>
- ---------------------
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE> 14
(This Page Intentionally Left Blank)
<PAGE> 15
(This Page Intentionally Left Blank)
<PAGE> 16
DIRECTORS
- ----------------------------------
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
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
Mitchell M. Merin
President
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. Read the
prospectus carefully before investing.
MORGAN STANLEY
DEAN WITTER
LIQUID ASSET FUND
[PHOTO]
Semiannual Report
February 29, 2000
