ACCESS CAPITAL STRATEGIES COMMUNITY INVESTMENT FUND INC/MA - 10-Q Quarterly Report

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 quarterly period ended November 30, 2004

¨	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. 817-00807

Access Capital Strategies Community Investment Fund, Inc.

(Exact name of registrant as specified in its charter)

Maryland

04-3369393

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)


124 Mt. Auburn Street, Suite 200N		Cambridge, MA 02138
(Address of principal executive offices)		(Zip Code)

617-576-5858

(Registrant’s telephone number, including area code)

N/A

(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 and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant has been required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 126-2 of the Exchange Act): Yes x No ¨

The registrant had 119 shareholders and 38,421,302 shares of common stock outstanding as of November 30, 2004.

Access Capital Strategies Community Investment Fund, Inc.

November 30, 2004 Form 10-Q Quarterly Report

TABLE OF CONTENTS


			PAGE
PART I. FINANCIAL INFORMATION

	Item 1.	Condensed Financial Statements

		Condensed Statements of Assets and Liabilities November 30, 2004 (unaudited), May 31, 2004, and November 30, 2003 (unaudited)	3

		Condensed Statements of Operations (unaudited) Three months ended November 30, 2004 and 2003; and Six months ended November 30, 2004 and 2003	4

		Condensed Statements of Changes in Net Assets (unaudited) Three months ended November 30, 2004 and 2003; and Six months ended November 30, 2004 and 2003	5

		Condensed Statements of Cash Flows (unaudited) Six months ended November 30, 2004 and 2003	6

		Financial Highlights (unaudited) Three months ended November 30, 2004 and 2003; and Six months ended November 30, 2004 and 2003	7

		Schedule of Investments November 30, 2004 (unaudited)	8

		Notes to Condensed Financial Statements (unaudited)	11

	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12

	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	20

	Item 4.	Controls and Procedures	21

PART II. OTHER INFORMATION			22

	Item 1.	Legal Proceedings	22

	Item 2.	Changes in Securities	22

	Item 3.	Defaults Upon Senior Securities	22

	Item 4.	Submission of Matters to a Vote of Security Holders	22

	Item 5.	Other Information	22

	Item 6.	Exhibits and Reports	22

	Signatures		23

Access Capital Strategies Community Investment Fund, Inc.

PART I — FINANCIAL INFORMATION

Item 1:

Condensed Financial Statements

CONDENSED STATEMENTS OF ASSETS AND LIABILITIES


	CONDENSED STATEMENTS OF ASSETS AND LIABILITIES
	November 30, 2004 (unaudited)			*May 31, 2004*			November 30, 2003 (unaudited)
Assets:
Investments in unaffiliated securities, at value*	$	454,229,930		$	398,567,401		$	365,254,153
Cash		866,225			—			6,897,028
Receivables:
Capital shares sold		7,000,000			14,785,251			8,018,000
Interest		2,020,380			1,776,197			1,669,140
Securities sold		2,871,343			—			—
Principal paydowns		280,972			370,198			52,828
Variation margin		—			191,468			376,873
Prepaid expenses and other assets		119,402			270			154,315

Total assets		467,388,252			415,690,785			382,422,337

Liabilities:
Payables:
Reverse repurchase agreements (including accrued interest of $64,467, $17,180 and $28,424, respectively)		81,364,467			51,117,180			85,528,424
Securities purchased		8,000,432			15,485,800			9,685,900
Dividends to shareholders		1,178,406			1,310,503			1,197,924
Custodian bank		—			956,797
Investment advisor		238,688			177,414			158,781
Variation margin		31,039			—			—
Other affiliates		8,127			2,565			12,327
Accrued expenses and other liabilities		31,197			73,326			—

Total liabilities		90,852,356			69,123,585			96,583,356

Net Assets:
Net Assets	$	376,535,896		$	346,567,200		$	285,838,981

Net Assets Consist of:
Paid-in capital	$	383,138,336		$	359,732,222		$	291,532,828

Accumulated distributions in excess of investment income - net		(1,306,395	)		(1,310,503	)		(1,401,841	)
Accumulated realized capital loss - net		(8,988,233	)		(7,361,655	)		(5,567,135	)
Unrealized appreciation (depreciation) - net		3,692,188			(4,492,864	)		1,275,129

Total accumulated loss - net		(6,602,440	)		(13,165,022	)		(5,693,847	)

Net Assets	$	376,535,896		$	346,567,200		$	285,838,981

Net Asset Value Per Share	$	9.80		$	9.62		$	9.83


* Identified cost	$	450,663,100		$	403,230,291		$	363,454,659
Shares issued and outstanding, $.0000001 par value, 100,000,000 shares authorized		38,421,302			36,035,590			29,087,879

See Notes to Condensed Financial Statements.

Access Capital Strategies Community Investment Fund, Inc.

CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)


	Three Months Ended						Six Months Ended
	November 30, 2004			November 30, 2003			November 30, 2004			November 30, 2003
Investment Income:

Interest	$	5,625,050		$	4,652,512		$	10,965,748		$	9,030,392

Expenses:
Management fees		544,965			429,171			1,056,629			828,981
Interest expense		324,410			189,822			518,303			379,475
Professional fees		41,981			49,629			72,726			79,283
Accounting services		24,769			24,656			61,682			45,681
Pricing fees		10,072			12,893			24,255			23,405
Custodian fees		10,506			9,311			24,876			16,482
Director’s fees and expenses		5,360			6,599			13,946			13,420
Transfer agent fees		3,573			4,539			9,297			8,671
Other		5,164			4,296			12,972			8,303

Total expenses before reimbursement		970,800			730,916			1,794,686			1,403,701
Reimbursement of expenses		171,059			60,729			308,562			136,535

Total expenses after reimbursement		1,141,859			791,645			2,103,248			1,540,236

Investment income - net		4,483,191			3,860,867			8,862,500			7,490,156

Realized & Unrealized Gain (Loss) - Net:
Realized gain (loss) on:
Investments - net		90,066			256,638			98,316			(239,935	)
Financial futures contracts - net		32,597			1,093,005			(1,724,894	)		164,253
Change in unrealized appreciation (depreciation) on: Investments - net		(2,839,861	)		(410,948	)		8,229,720			(9,572,679	)
Financial futures contracts - net		330,176			—			(44,668	)		—

Total realized and unrealized gain (loss) - net		(2,387,022	)		938,695			6,558,474			(9,648,361	)

Net Increase (Decrease) in Net Assets Resulting from Operations	$	2,096,169		$	4,799,562		$	15,420,974		$	(2,158,205	)

See Notes to Condensed Financial Statements.

Access Capital Strategies Community Investment Fund, Inc.

CONDENSED STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)


	Three Months Ended						Six Months Ended
*Increase (Decrease) in Net Assets:*	November 30, 2004			November 30, 2003			November 30, 2004			November 30, 2003
Operations:
Investment income-net	$	4,483,191		$	3,860,867		$	8,862,500		$	7,490,156
Realized gain (loss) - net		122,663			1,349,643			(1,626,578	)		(75,682	)
Change in unrealized appreciation/depreciation - net		(2,509,685	)		(410,948	)		8,185,052			(9,572,679	)

Net increase (decrease) in net assets resulting from operations		2,096,169			4,799,562			15,420,974			(2,158,205	)

Dividends to Shareholders:
Dividends to shareholders from investment income-net		(4,479,083	)		(3,860,862	)		(8,858,392	)		(7,490,168	)

Capital Share Transactions:
Proceeds from sale of shares		12,125,000			28,468,000			26,475,000			59,908,000
Value of shares issued to shareholders in reinvestment of dividends		976,953			430,595			1,926,432			769,626

Total issued		13,101,953			28,898,595			28,401,432			60,677,626
Cost of shares redeemed		—			(12,224,152	)		(4,995,318	)		(12,224,152	)

Net increase in net assets derived from capital share transactions		13,101,953			16,674,443			23,406,114			48,453,474

Net Assets:
Total increase in net assets		10,719,039			17,613,143			29,968,696			38,805,101
Beginning of period		365,816,857			268,225,838			346,567,200			247,033,880

End of period*	$	376,535,896		$	285,838,981		$	376,535,896		$	285,838,981

* Accumulated distributions in excess of investment income - net	$	(1,306,395	)	$	(1,401,841	)	$	(1,306,395	)	$	(1,401,841	)

See Notes to Condensed Financial Statements.

Access Capital Strategies Community Investment Fund, Inc.

CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)


	Six Months Ended
	November 30, 2004			November 30, 2003
Cash Used For Operating Activities:
Net increase (decrease) in net assets resulting from operations	$	15,420,974		$	(2,158,205	)
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash used for operating activities:
Increase in receivables		(52,715	)		(532,931	)
Increase in other assets		(119,132	)		(105,106	)
Increase in other liabilities		(853,764	)		(85,279	)
Realized and unrealized loss (gain) - net		(8,328,036	)		10,081,095
Amortization of premium and discount		(5,201	)		3,173
Proceeds from paydowns and sales of long-term investments		59,886,314			94,686,487
Purchases of long-term investments		(117,483,091	)		(167,081,187	)

Net cash used for operating activities		(51,534,651	)		(65,191,953	)

Cash Provided By Financing Activities:
Cash receipts from issuance of common stock		34,260,251			51,990,000
Cash receipts from reverse repurchase agreements - net		30,200,000			38,500,000
Cash payments on capital shares redeemed - net		(4,995,318	)		(12,224,152	)
Dividends to shareholders		(7,064,057	)		(7,675,693	)

Net cash provided by financing activities		52,400,876			70,590,155

Cash:
Net increase in cash		866,225			5,398,202
Cash at beginning of period		—			1,498,826

Cash at end of period	$	866,225		$	6,897,028

Cash Flow Information:
Cash paid for interest	$	471,016		$	369,922

Non-Cash Financing Activities:
Capital shares issued in reinvestment of dividends paid to shareholders	$	1,926,432		$	769,626

See Notes to Condensed Financial Statements.

Access Capital Strategies Community Investment Fund, Inc.

FINANCIAL HIGHLIGHTS (UNAUDITED)

The following per share data and ratios have been derived from information provided in the financial statements.


	Three Months Ended						Six Months Ended
*Increase (Decrease) in Net Asset Value:*	November 30, 2004			November 30, 2003			November 30, 2004			November 30, 2003
Per Share Operating Performance:
Net asset value, beginning of period	$	9.86		$	9.78		$	9.62		$	10.21

Investment income-net+		.12			.14			.24			.28
Realized and unrealized gain (loss) - net		(.06	)		.05			.18			(.38	)

Total from investment operations		.06			.19			.42			(.10	)

Less dividends from investment income - net		(.12	)		(.14	)		(.24	)		(.28	)

Net asset value, end of period	$	9.80		$	9.83		$	9.80		$	9.83

Total Investment Return:**
Based on net asset value per share		0.61	%#		1.83	%#		4.40	%#		(1.02	)%#

Ratios to Average Net Assets:
Expenses, net of reimbursement and excluding interest expense		.89	%*		.87	%*		.88	%*		.87	%*

Expenses, excluding interest expense		.70	%*		.78	%*		.71	%*		.77	%*

Expenses		1.06	%*		1.06	%*		1.00	%*		1.06	%*

Investment income - net		4.88	%*		5.59	%*		4.92	%*		5.64	%*

Ratios to Average Net Assets, Excluding Borrowings:
Expenses, net of reimbursement and excluding interest expense		.75	%*		.71	%*		.75	%*		.70	%*

Expenses, excluding interest expense		.59	%*		.64	%*		.60	%*		.62	%*

Expenses		.89	%*		.86	%*		.85	%*		.85	%*

Investment income - net		4.11	%*		4.54	%*		4.19	%*		4.55	%*

Supplemental Data:
Net assets, end of period (in thousands)	$	376,536		$	285,839		$	376,536		$	285,839

*	Annualized.

**	Total investment returns exclude the effects of sales charges.

#	Aggregate total investment return.

Based on average shares outstanding. Starting June 1, 2003, the Fund began paying dividends on a monthly basis; previously dividends had been paid on a calendar quarter basis. Due to the transition, the fiscal 2003 dividends include fourteen months of income while fiscal 2004 contained twelve months of income.

See Notes to Condensed Financial Statements.

Access Capital Strategies Community Investment Fund, Inc.

SCHEDULE OF INVESTMENTS

NOVEMBER 30, 2004 (UNAUDITED)


	Face Amount		Market Value
MORTGAGE-BACKED SECURITIES (120.1%):
Federal National Mortgage Association (FNMA)(76.7%):

15 Year Fixed Rate Single Family Mortgage-Backed Securities
4.50%, 10/1/18 - 12/15/19(b)	$	7,342,692	$	7,345,671
5.00%, 12/1/17 - 2/1/19		8,852,719		9,037,784
5.50%, 3/1/16 - 7/1/19		1,531,027		1,590,624
7.00%, 1/1/15		78,265		83,509

30 Year Fixed Rate Single Family Mortgage-Backed Securities
4.50%, 5/1/33 - 2/1/34(c)		13,202,724		12,796,334
5.00%, 7/1/32 - 11/1/34(c)		99,316,463		98,820,977
5.50%, 9/1/32 - 12/15/34(b)		86,750,364		88,403,937
6.00%, 11/1/31 - 9/1/34		27,114,202		28,173,559
6.50%, 3/1/31 - 8/1/34		21,361,238		22,560,407
7.00%, 6/1/29 - 3/1/31		1,008,649		1,077,197
7.25%, 12/1/29		79,170		84,942
7.50%, 12/1/29 - 1/1/31		1,156,293		1,246,657
8.00%, 2/1/30 - 4/1/30		373,435		407,698

Total Single Family Mortgage-Backed Securities				271,629,296

Multi Family Mortgage-Backed Securities
4.66%, 10/1/13		986,636		992,174
4.78%, 5/1/14		496,678		500,997
4.93%, 10/1/12		986,552		1,008,587
5.23%, 4/1/21		1,964,496		1,938,351
5.37%, 11/1/21		5,065,594		5,221,348
5.41%, 2/1/21		1,060,745		1,097,770
5.51%, 11/1/21		766,325		776,502
6.38%, 5/1/11		1,204,622		1,323,457
6.50%, 5/1/17		1,279,376		1,380,830
6.70%, 6/1/19		655,625		720,923
7.13%, 1/1/22		431,424		478,929
7.58%, 5/1/18		610,372		714,670
7.97%, 9/1/17		728,359		871,053

Total Multi Family Mortgage-Backed Securities				17,025,591

Total Federal National Mortgage Association Securities				288,654,887

Federal Home Loan Mortgage Corporation (37.7%):

15 Year Fixed Rate Single Family Mortgage-Backed Securities
4.50%, 1/1/19 - 11/1/19		2,978,031		2,979,465
5%, 11/1/18 - 12/15/19(b)		3,870,798		3,946,698
5.50%, 9/1/19 - 12/15/19(b)		1,707,933		1,772,417


	Face Amount		Market Value
30 Year Fixed Rate Single Family Mortgage-Backed Securities
4.50%, 8/1/33 - 9/1/33	$	3,377,144	$	3,271,757
5.00%, 6/1/33 - 12/15/34(b)		33,244,392		33,103,553
5.50%, 9/1/29 - 12/15/34(b)		63,924,911		65,170,761
6.00%, 3/1/31 - 9/1/34		21,330,407		22,144,865
6.50%, 6/1/29 - 8/1/32		7,398,327		7,805,719
7.00%, 11/1/29 - 4/1/31		988,100		1,054,715
7.50%, 12/1/29 - 3/1/30		836,830		902,499

Total Federal Home Loan Mortgage Corporation Single Family Mortgage-Backed Securities				142,152,449

GNMA Pool (1.4%):

30 Year Fixed Rate Single Family Mortgage-Backed Securities
6.00%, 12/15/31		830,164		864,900
6.50%, 4/15/32 - 4/20/32		522,571		553,837
7.00%, 4/15/32		176,453		188,768

Total Single Family Mortgage-Backed Securities				1,607,505

Multi Family Mortgage-Backed Securities
5.13%, 3/15/34		631,462		632,914
5.75%, 9/15/23		745,987		763,452
6.25%, 9/15/32		526,144		570,317
8.25%, 12/15/32		1,450,534		1,624,469

Total Multi Family Mortgage-Backed Securities				3,591,152

Total GNMA Pool Multi Family Mortgage-Backed Securities				5,198,657

Community Reinvestment Revenue Notes (0.8%)
4.21%, 9/01/19		3,000,000		3,000,000

Total Community Reinvestment Revenue Notes				3,000,000


Small Business Administration (3.5%)
1.55%, 3/25/29(d)		3,202,258		3,173,875
1.55%, 4/25/28(a)(d)		1,705,703		1,735,012
1.63%, 6/25/18(a)(d)		874,919		868,785
1.65%, 10/25/10(d)		758,315		753,873
1.65%, 3/25/14(d)		2,450,917		2,435,884
2.10%, 9/01/28(d)		1,576,663		1,576,663
2.35%, 9/25/09(d)		2,032,154		2,032,154
4.88%, 1/25/09(d)		755,211		783,256

Total Small Business Administration Securities				13,359,502

Total Mortgage-Backed Securities				452,365,495


MUNICIPAL BONDS (0.5%):

Guam Power Authority Revenue Bonds, Series A, 5% due 10/01/2024	140,000		144,050
Utah Housing Corporation Single Family Mortgage Revenue Bonds, 3.36% due 7/1/2014	750,000		726,045
Utah Housing Corporation Single Family Mortgage Revenue Bonds, 3.48% due 7/1/2014	1,000,000		994,340

Total Municipal Bonds			1,864,435

Total investments (cost - $450,663,100) - 120.6%			454,229,930

Liabilities in excess of other assets - (20.6%)			(77,694,034	)

Net assets - 100.0%		$	376,535,896

(a)	All or a portion held as collateral in connection with open financial futures contracts.

(b)	Represents or includes a “to-be-announced” (TBA) transaction. The Fund has committed to purchasing securities for which all specific information is not available at this time.

(c)	All or a portion held as collateral in connection with open reverse repurchase agreements.

(d)	Floating rate note.

Pursuant to the financial futures contracts, the Fund agrees to receive from or pay to the broker an amount equal to the daily fluctuation in values of the contract. Such receipts or payments, which are settled the following business day, are known as variation margin and are recorded by the Fund as unrealized gains or losses. Financial futures contracts sold as of November 30, 2004 were as follows:


Number of Contracts	Issue	Expiration Date	Face Value		Unrealized Appreciation (Depreciation)
33	U.S. Five-Year Treasury Bonds	March 2005	$	3,589,869	$	(1,459	)
247	U.S. Five-Year Treasury Bonds	December 2004	$	27,240,387		139,856
225	U.S. Ten-Year Treasury Bonds	March 2005	$	24,905,711		(13,039	)

Total Unrealized Appreciation - Net					$	125,358

See Notes to Condensed Financial Statements.

Access Capital Strategies Community Investment Fund, Inc.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

1. Basis of Presentation

The accompanying unaudited condensed interim financial statements and financial highlights reflect the results of operations for Access Capital Strategies Community Investment Fund, Inc. (the “Fund”) and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal recurring nature. The results of operations and other data for the six months and quarter ended November 30, 2004 are not necessarily indicative of the results that may be expected for any other future interim period or the fiscal year ending May 31, 2005. The information in this report should be read in conjunction with the financial statements and accompanying notes included in the May 31, 2004 Annual Report on Form 10-K. The Fund has not changed its accounting and reporting policies from those disclosed in its May 31, 2004 financial statements.

In preparing the condensed interim financial statements and financial highlights, management is required to make estimates and assumptions that effect the reported amounts of assets and liabilities as of the date of the statement of assets and liabilities, and revenue and expenses for the period. Actual results could differ from those estimates; any such differences are expected to be immaterial to the net assets of the Fund.

This report covers the activity from June 1, 2004 to November 30, 2004.

Item 2:

Management’s Discussion and Analysis of Financial Condition and

Results of Operations

This quarterly report contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. The Fund’s actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in interest rates, fluctuations in assets under management and other sources of fee income, and changes in assumptions used in making such forward-looking statements. The Fund’s investment objective is to invest in geographically specific private placement debt securities located in portions of the United States designated by Fund investors.

Overview

The Fund is a non-diversified, closed-end management investment company electing status as a business development company. The Fund’s investment objective is to invest in geographically specific private placement debt securities located in portions of the United States designated by Fund investors. The Fund invests primarily in private placement debt securities specifically designed to support underlying community development activities targeted to low- and moderate-income individuals such as affordable housing, education, small business lending, and job-creating activities in areas of the United States designated by Fund investors.

Investors in the Fund must designate a particular geographic area or region within the United States as part of their agreement to purchase Fund shares. The Fund invests only in areas where Fund shareholders have made targeted designations.

In addition to their geographic specificity, Fund investments must carry a AAA credit rating or carry credit enhancement from a AAA-rated credit enhancer or be issued or guaranteed by the U.S. Government, government agencies or government-sponsored enterprises. The Fund expects (but cannot guarantee) that all investments made by the Fund will be considered eligible for regulatory credit under the Community Reinvestment Act (“CRA”).

Compliance

To qualify as a Regulated Investment Company (“RIC”), the Fund must, among other things, satisfy a diversification standard under the Internal Revenue Code (the “Code”) such that, at the close of each quarter of the Fund’s taxable year, (i) not more than 25% of the value of its total assets is invested in the securities (other than government securities (including its agencies and instrumentalities) or securities of other RICs) of a single issuer, or two or more issuers which the Fund controls (under a 20% test) and which are engaged in the same or similar trades or business or related trades or businesses, and (ii) at least 50% of the market value of its total assets is represented by cash, cash items, government securities, securities of other RICs and other securities (with each investment in such other securities limited so that not more than 5% of the value of the Fund’s total assets is invested in the securities of a single issuer and the Fund does not own more than 10% of the outstanding voting securities of a single issuer).

Management believes the Fund was in compliance with the above requirements for the quarter ended November 30, 2004.

Fund Operations

Investment Activity

Purchases

During the quarter ended November 30, 2004, the Fund purchased $53.1 million aggregate amount of new community development securities. During the quarter ended November 30, 2003, the Fund had purchased $89.7 million aggregate amount of new community development securities.

During the six months ended November 30, 2004, the Fund purchased $110.0 million aggregate amount of new community development securities. During the six months ended November 30, 2003, the Fund had purchased $153.4 million aggregate amount of new community development securities.

Sales

During the quarter ended November 30, 2004, the Fund sold $38.3 million aggregate amount of securities (including principal paydowns). During the quarter ended November 30, 2003, the Fund had sold $48.9 million aggregate amount of securities (including principal paydowns).

During the six months ended November 30, 2004, the Fund sold $62.7 million aggregate amount of securities (including principal paydowns). During the six months ended November 30, 2003, the Fund had sold $94.7 million aggregate amount of securities (including principal paydowns).

Borrowings

The Fund is permitted to use leverage in its investment program, subject to certain restrictions set forth in its Private Offering Memorandum and the Investment Company Act of 1940 (the “1940 Act”).

For the quarter ended November 30, 2004, the Fund averaged approximately $69.0 million in borrowings at an average rate of approximately 1.86% compared to the quarter ended November 30, 2003 when the Fund averaged approximately $67.7 million in borrowings at an average rate of approximately 1.14%.

For the six month period ended November 30, 2004, the Fund averaged approximately $62.0 million in borrowings at an average rate of approximately 1.65% compared to the six month period ended November 30, 2003 when the Fund averaged approximately $64.4 million in borrowings at an average rate of approximately 1.15%.

In each of the above referenced periods, the total proceeds from borrowings were primarily used to support additional investments in the Fund’s Designated Target Regions.

Net Assets and Fund Holdings at November 30, 2004

At November 30, 2004, the Fund’s Net Asset Value was $376.5 million, or $9.80 per share. At the end of the prior fiscal quarter, August 31, 2004, the Fund’s Net Asset Value was $365.8 million, or $9.86 per share. At the end of the most recent fiscal year, May 31, 2004, the Net Asset Value was $346.6 million, or $9.62 per share. A year ago at November 30, 2003, the Fund’s Net Asset Value was $285.8 million, or $9.83 per share.

The $10.7 million, or 2.9%, quarter-to-quarter increase in net assets from $365.8 million to $376.5 million was primarily attributable to the sale of new shares in the Fund. The $90.7 million, or 31.7%, year-to-year increase in net assets was also primarily attributable to the sale of new shares in the Fund.

The Fund’s primary investments are listed on the Schedule of Investments included with this report.

Investment Income

The Fund had investment income net of all fees and expenses (as discussed below) of $4.5 million for the quarter ended November 30, 2004, an increase of approximately $0.1 million, or 2.3%, from net investment income of $4.4 million for the prior fiscal quarter, which ended August 31, 2004, and an increase of approximately $0.6 million, or 15.4%, from net investment income of $3.9 million for the fiscal quarter ended November 30, 2003. The increases were each largely due to an increase in the average net assets of the Fund.

The Fund had investment income net of all fees and expenses (as discussed below) of $8.9 million for the six month period ended November 30, 2004, an increase of approximately $1.4 million, or 18.7% from net investment income of $7.5 million for the six month period ended November 30, 2003. The increase is largely due to an increase in average net assets of the Fund.

Management Fees & Expenses

Access Capital Strategies LLC (“Access”), the Fund’s Manager, is paid an annual management fee, paid monthly, of fifty basis points (.50%) of the Fund’s average monthly gross assets less accrued liabilities, other than indebtedness for borrowing. Merrill Lynch Investment Managers, L.P. (“MLIM”) receives from Access an annual sub-management fee, paid monthly, of twenty-five basis points (.25%) of the Fund’s average gross monthly assets less accrued liabilities, other than indebtedness for borrowings.

For the quarter ended November 30, 2004, the management fee paid by the Fund was $544,965. For the prior quarter ended August 31, 2004, the management fee paid by the Fund was $511,664. For the year ago fiscal quarter and six month period ended November 30, 2003, the management fee paid by the Fund was $429,171 and $828,981, respectively. The increases were primarily due to increases in the net assets of the Fund.

The Fund’s private offering memorandum provides for reimbursement of expenses relating to the Fund paid by Access and MLIM. Total unreimbursed expenses as of November 30, 2004 amount to $174,812 compared to $597,328 a year ago at November 30, 2003.

Yield

At the quarter ended November 30, 2004, the SEC current yield was 4.73%, compared to 4.90% for the quarter ended August 31, 2004 and 5.61% for the year ago quarter ended November 30, 2003.

For the quarter ended November 30, 2004, the ratio of net investment income to average net assets was 4.11% compared to 4.28% for the prior quarter, which ended August 31, 2004, and 5.59% for the quarter ended November 30, 2003.

Realized Gain/Loss

For the quarter ended November 30, 2004, the realized gain was $122,663, compared to a realized loss of $1,749,241 for the prior quarter, which ended August 31, 2004, and a realized loss of $1,349,643 for the quarter ended November 30, 2003. The realized losses were primarily due to the Fund’s hedging activities as the Fund experiences a realized gain or loss on its hedges when the positions are closed or when they are rolled from one expiration cycle to the next.

Dividends Paid

The Fund distributes to shareholders substantially all of its net investment income and net realized capital gains, if any, as determined for income tax purposes. Applicable law, including provisions of the 1940 Act, may limit the amount of dividends and other distributions payable by the Fund. Substantially all of the Fund’s net capital gain (the excess of net long-term capital gain over net short-term capital loss) and the excess of net short-term capital gain over net long-term capital loss, if any, are distributed annually with the Fund’s dividend distribution in December.

The Fund declares and distributes dividends on a monthly basis. The Fund paid total monthly dividends of $.119745 during the quarter ended November 30, 2004. The dividends were paid as follows:


September 2004	$	.040395
October 2004	$	.039403
November 2004	$	.039947

During the previous quarter ended August 31, 2004, the Fund paid total monthly dividends of $.121087. A year ago, during the quarter ended November 30, 2003, the Fund paid total monthly dividends of $.137550. The slightly lower dividend in the current period is attributable to the U.S. Federal Reserve raising short term interest rates by twenty-five basis points in September and November. An increase in short term rates elevates the Fund’s cost for borrowings and lowers the net interest income available for dividends.

Total Return

For the quarter ended November 30, 2004, the total return was 0.61%, compared to a total return of 3.77% in the quarter ended August 31, 2004 and a total return of 1.83% in the comparable quarter ended November 30, 2003.

For the six month period ended November 30, 2004 the total return was 4.4%. For the six month period ended November 30, 2003, the total return was -1.0%.

The lower total return during the quarter ended November 30, 2004 is attributable to pricing pressure on fixed income assets during a time of interest rate increases.

Fund Designated Target Regions at November 30, 2004

The Fund’s Designated Target Regions (“DTRs”) are provided by Fund shareholders at the time of investment. At November 30, 2004 DTRs were:


DTRs	AMOUNT
Alabama	$	5,000,000
California		60,668,939
Colorado		1,145,660
Connecticut		7,084,919
Florida		1,500,000
Georgia		500,000
Hawaii		148,786
Illinois		3,632,476
Indiana		1,027,479
Iowa		512,282
Louisiana		5,000,000
Maine		108,477
Maryland		650,000
Massachusetts		90,062,013
Nebraska		10,000,000
New York		16,864,824
New Jersey		95,232,959
New Mexico		1,125,571
North Carolina		500,000
Ohio		12,050,747
Oregon		500,000
Pennsylvania		33,754,054
Rhode Island		250,000
South Dakota		5,655,359
Tennessee		600,000
Texas		21,002,587
Utah		4,682,430
Vermont		1,325,745
Washington		1,500,000
Wisconsin		525,571

TOTAL	$	382,610,878

*	All investors are listed by headquarters location

Fund Impact per the Community Reinvestment Act

The Fund invests in securities that support community development economic activity as defined in the CRA.

At November 30, 2004, the Fund’s investments had outstanding loans to 5,337 homebuyers with incomes below 80% of median income from the following states in the following numbers.


Whole Loans

Alabama		37
Arizona		159
California		404
Colorado		32
Connecticut		107
Delaware		26
Florida		130
Georgia		18
Guam		2
Illinois		74
Indiana		5
Iowa		18
Kansas		5
Kentucky		10
Louisiana		19
Maine		2
Maryland		4
Massachusetts		1,061
Michigan		7
Mississippi		8
Missouri		5
Montana		2
Nebraska		56
Nevada		48
New Hampshire		60
New Jersey		1,004
New Mexico		70
New York		219
North Carolina		17
Ohio		50
Oregon		53
Pennsylvania		594
Rhode Island		15
South Carolina		14
South Dakota		110
Tennessee		8
Texas		438


Utah		369
Vermont		14
Virginia		3
Washington		47
Washington, D.C.		3
Wisconsin		10

		5,337

Many of the above loans were made under targeted CRA lending initiatives such as Acorn, Mass Housing Partnership and other individual banks tailor made CRA lending programs.

In addition as of November 30, 2004, the Fund’s investments had outstanding loans to sponsors of 1,380 multi-family, 14 community based non-profit affordable housing rental units and 76 SBA loans from the following states in the following amounts.

Multi-Family Units


Alabama		52
California		160
Delaware		120
Louisiana		230
Mississippi		47
New York		222
South Dakota		48
Texas		294
Utah		207

		1,380

Affordable Housing

Sub Total 6,717


Community Based Non-Profit
Rhode Island		14

		14


SBA Loans

CA		2
FL		1
KY		1
MA		7
MD		1
MN		2
NJ		6
NY		1
UT		55

		76

Liquidity Discussion

Sale and Redemption of Fund Shares

Fund shares are sold only to qualified investors who complete a Subscription Agreement. All investors in the Fund must provide a Designated Target Region as the desired location for their investment.

During the quarter ended November 30, 2004, new shareholders purchased an additional 1,234,722 shares of the Fund for total proceeds of $12,125,000. In addition, dividend reinvestments resulted in 99,320 additional new shares being issued by the Fund for total proceeds of $976,953. During the year ago quarter ended November 30, 2003, new shareholders purchased an additional 2,869,988 shares of the Fund for total proceeds of $28,468,000, and dividend reimbursements resulted in 43,605 additional new shares being issued by the Fund for total proceeds of $430,595.

During the six months ended November 30, 2004, new shareholders purchased an additional 2,697,211 shares of the Fund for total proceeds of $26,475,000. In addition, dividend reinvestments resulted in 196,672 additional new shares being issued by the

Fund for total proceeds of $1,926,432. During the year ago six months ended November 30, 2003, new shareholders purchased an additional 6,061,610 shares of the Fund for total proceeds of $59,908,000 and dividend reimbursements resulted in 77,926 additional new shares being issued by the Fund for total proceeds of $769,626.

As discussed in the Private Offering Memorandum, the Fund allows shareholders to redeem their shares in accordance with Rule 23c-3 of the 1940 Act.

During the quarter ended November 30, 2004, there were no redemptions. During the year ago quarter November 30, 2003, 1,247,362 shares of the Fund were redeemed for $12,224,152

During the six months ended November 30, 2004, 508,171 shares of the Fund were redeemed for $4,995,318. During the year ago six months November 30, 2003, 1,247,363 shares of the Fund were redeemed for $12,224,152.

Item 3:

Quantitative and Qualitative Disclosures About Market Risk

A full discussion of the risks associated with ownership of Fund shares appears in the Fund’s Private Offering Memorandum. The Fund’s principal market risks may be summarized as follows:

Credit Risk. All investments made by the Fund must be in securities of a U.S. Government Agency or AAA credit quality. Fund investments will typically have one or more forms of credit enhancement.

Liquidity Risk. Securities purchased by the Fund will generally be privately placed debt instruments. The market for resale of these securities may be limited. Furthermore, the Fund may pay a premium for CRA securities without any assurance that a comparable premium can be received upon sale of the security.

Interest Rate Risk. The Fund will generally invest in fixed rate investments that have their market values directly affected by changes in prevailing interest rates. An increase in interest rates will generally reduce the value of Fund investments and a decline in interest rates will generally increase the value of those investments. There may be exceptions due to shifts in the yield curve, the performance of individual securities, changes in the prepayment rates of mortgages underlying fixed income securities and other market factors.

Most of the Fund’s holdings are in mortgage-backed securities (MBS) that are comprised of pooled mortgages to low and moderate income homebuyers. These homebuyers generally have the right to prepay or refinance their mortgages at anytime making prepayment risk an important component of the market risk for the portfolio. While prepayments can occur for a variety of reasons (e.g., selling a home, death, default) they are most often associated with a consumer refinancing a mortgage to take advantage of lower interest rates. There is, therefore, a structural asymmetry, also known as negative convexity, in the MBS market as lower rates will raise the value of most fixed rate payment streams, but may cause wide scale prepayments for fixed rate MBS due to mortgage refinancing.

An industry standard method for evaluating interest rate risk in a portfolio is to run a scenario analysis that calls for an instantaneous increase or decrease in interest rates across the board. While the scenario is a highly unlikely one, it does produce a widely used measurement for a portfolio’s interest rate convexity and negative convexity.

At November 30, 2004 an instant rate increase of 100 basis points (1.0%) would have caused the Fund’s portfolio to decline in value by -4.9%. An instant rate decrease of 100 basis points (-1.0%) would have caused the Fund’s portfolio to increase in value by +2.8%. At the previous quarter end, August 31, 2004, a 1% rate increase would have produced a -5.2% decrease in value and a 1% rate decrease would have produced a +2.8% increase in value.

Derivatives Risk. The Fund may use derivative instruments, including futures, forwards, options, indexed securities, and inverse securities for hedging purposes. Hedging is a strategy in which the Fund uses a derivative to offset the risk that other Fund holdings may decrease in value. While hedging can reduce losses, it can also reduce or eliminate gains if the market moves in a different manner than anticipated by the Fund or if the cost of the derivative outweighs the benefit of the hedge. Hedging also involves the risk that changes in the value of the derivative will not match those of the holdings being hedged as expected by the Fund, in which case any losses on the holdings being hedged may not be reduced. There can be no assurance that the Fund’s hedging strategy will reduce risk or that hedging transactions will be either available or cost effective.

A summary of the Fund’s portfolio holdings as of November 30, 2004 is contained in Item 1 of this report.

Item 4:

Controls and Procedures

Within the 90-day period prior to the filing of this report, the Fund’s management, including the Chief Executive Officer and principal financial officer, conducted an evaluation of the effectiveness of the design and operation of the Fund’s disclosure controls and procedures. Based on that evaluation, the Chief Executive Officer and principal financial officer concluded that, as of the date of the evaluation, the disclosure controls and procedures were effective in alerting them in a timely manner to material information required to be disclosed in the Fund’s periodic reports filed with the SEC. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving it stated goals under all potential future conditions, regardless of how remote. There have been no significant changes in internal controls, or in factors that could significantly affect internal controls, subsequent to the date of the most recent evaluation.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Fund is not involved in any pending legal proceedings.

Item 2. Changes in Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Submission of Matters to a Vote of Security Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits and Reports

The following Exhibits are filed as part of this Report:


(a)	(1)		N/A

	(2)		None

	(3)	(i)	Articles of Incorporation are incorporated by reference to the Fund’s Form 10-Q for the period ended August 31, 1998.

		(ii)	By-Laws are incorporated by reference to the Fund’s Form 10-Q for the period ended August 31, 1998.

	(4)		N/A

	(5)		N/A

	(8)		N/A

	(9)		None

	(10)	(i)	Private Offering Memorandum dated February 18, 1998, revised as June 1, 2003, is incorporated by reference to the Fund’s Form 10-K filed on August 29, 2004.

		(iii)(A)	Management Agreement is incorporated by reference to the Fund’s Form 10-Q for the period ended August 31, 1998.

		(B)	Amendment to the Management Agreement dated as of May 23, 2003 is incorporated by reference to the Fund’s Form 10-K filed on August 29, 2004.

	(11)		N/A

	(12)		N/A

	(13)		N/A

	(15)		N/A

	(16)		None

	(17)		N/A

	(18)		N/A

	(19)		N/A

	(20)		N/A

	(21)		None

	(22)		N/A

	(23)		N/A

	(24)		Powers of Attorney incorporated by reference to the Fund’s Form 10-K for the fiscal year ended May 31, 2002 filed on August 29, 2002.

	(25)		N/A
	(26)		N/A

	(27)		Reserved

	(28)		Reserved

	(29)		Reserved

	(30)		Reserved

	(31)		Certifications required by the Sarbanes-Oxley Act of 2002

(b)	Reports on Form 8-K None.

Signatures

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.


		Access Capital Strategies Community Investment Fund, Inc.

Date: January 8, 2005		/S/ Ronald A. Homer*
		Ronald A. Homer, Chairman

Date: January 8, 2005		/S/ Kevin J. Mulvaney*
		Kevin J. Mulvaney, Director

Date: January 8, 2005		/S/ Peter Blampied*
		Peter Blampied, Director

Date: January 8, 2005		/S/ M. Colyer Crum*
		M. Colyer Crum, Director

Date: January 8, 2005		/S/ Terry K. Glenn*
		Terry K. Glenn, Director

Date: January 8, 2005		/S/ Stephen B. Swensrud*
		Stephen B. Swensrud, Director

Date: January 8, 2005		/S/ David F. Sand*
		David F. Sand, Chief Executive Officer,
		Principal Accounting Officer, Principal Financial Officer


* By:		/s/ Martin E. Lybecker
		Martin E. Lybecker
		Attorney-in-fact

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