NOTES TO FINANCIAL STATEMENTS
December 31, 1998
1. SIGNIFICANT ACCOUNTING POLICIES
The Warburg Pincus Cash Reserve Fund and the Warburg Pincus New York Tax Exempt Fund are registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as diversified and non-diversified,
open-end management investment companies, respectively.
Investment objectives for each fund are as follows: the Cash Reserve Fund is designed to provide investors with
high current income consistent with liquidity and stability of principal; the New York Tax Exempt Fund is
designed to provide investors with as high a level of current income that is exempt from federal, New York State
and New York City personal income taxes as is consistent with preservation of capital and liquidity.
Certain New York state and New York City municipal obligations in the New York Tax Exempt Fund may be
obligations of issuers which rely in whole or in part on New York state or New York City revenues, real
property taxes, revenues from health care institutions, or obligations secured by mortgages on real property.
Consequently, the possible effect of economic conditions in New York or of changes in New York regulations
on these obligations must be considered.
The net asset value of each fund is determined as of noon and the close of regular trading on the New York
Stock Exchange. Each fund's investments are valued under the amortized cost method, which approximates
market value. Amortized cost involves valuing a portfolio instrument at its cost initially and thereafter assuming a
constant amortization to maturity of any discount or premium, regardless of the impact of fluctuating interest rates
on the market value of the instrument.
Security transactions are accounted for on a trade date basis. Interest income is recorded on the accrual basis.
The cost of investments sold is determined by use of the specific identification method for both financial reporting
and income tax purposes.
Dividends from net investment income