UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-21605 --------- The Topiary Master Fund for Benefit Plan Investors (BPI) LLC ------------------------------------------------------------------ (Exact name of registrant as specified in charter) 345 Park Avenue New York, NY 10154 ------------------------------------------------------------------ (Address of principal executive offices) (Zip code) John H. Kim, Director & Senior Counsel Deutsche Asset Management 345 Park Avenue New York, NY 10154 ------------------------------------------------------------------ (Name and address of agent for service) registrant's telephone number, including area code: 212-454-6849 ------------ Date of fiscal year end: March 31 -------- Date of reporting period: September 30, 2006 ------------------ Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. ITEM 1. REPORTS TO STOCKHOLDERS. The Report to Shareholders is attached herewith. THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC FINANCIAL STATEMENTS (unaudited) For the Six Months Ended September 30, 2006 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Financial Statements (unaudited) For the Six Months Ended September 30, 2006 CONTENTS Statement of Assets, Liabilities, and Members' Capital ................. 1 Schedule of Investments................................................. 2-3 Statement of Operations................................................. 4 Statement of Changes in Members' Capital................................ 5 Statement of Cash Flows................................................. 6 Financial Highlights.................................................... 7 Notes to Financial Statements........................................... 8-13 Directors and Officers Biographical Data................................ 14-18 Portfolio Proxy Voting Policies and Procedures; SEC Filings............. 19 Components of Net Assets by Investment Strategy ...... ................. 20 1 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Statement of Assets, Liabilities and Members' Capital (unaudited) SEPTEMBER 30, 2006 ASSETS Investments in investment funds, at fair value (cost $71,836,108) $81,627,381 Cash and cash equivalents 4,984,871 Investments in investment funds made in advance 1,900,000 Receivable for investment funds sold 1,118,856 Receivable from Advisor 71,603 Prepaid expenses 39,168 Other assets 13,706 ----------- TOTAL ASSETS $89,755,585 =========== LIABILITIES Subscriptions received in advance 3,221,728 Management fee payable 227,537 Professional fees payable 101,760 Taxes payable 95,966 Board preparation fees payable 68,750 Registration fees payable 37,004 Administration fees payable 26,668 Investor services fees payable 26,510 Custodian fees payable 2,200 Other fees payable 23,350 ----------- TOTAL LIABILITIES 3,831,473 ----------- MEMBERS' CAPITAL 85,924,112 ----------- TOTAL LIABILITIES AND MEMBERS' CAPITAL $89,755,585 =========== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 1 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Schedule of Investments (unaudited) September 30, 2006 % OF MEMBERS' STRATEGY INVESTMENT FUND COST FAIR VALUE LIQUIDITY CAPITAL -------- --------------- ---- ---------- --------- ------- Event Driven Avenue Europe Investments, L.P. $ 932,212 $ 1,175,564 Quarterly 1.4% Gracie Capital L.P. 2,000,000 2,241,634 Annually 2.6% Harbinger Capital Partners I, L.P. 1,374,965 1,721,302 Quarterly 2.0% Jana Partners Qualified, L.P. 2,450,000 2,696,026 Quarterly 3.1% Marathon Special Opportunity Fund, L.P. 1,500,000 1,758,638 Annually 2.0% Merced Partners, L.P. 1,550,000 1,906,150 Annually 2.2% Perry Partners, L.P. 2,600,000 3,004,144 Annually 3.5% Strategic Value Restructuring Fund, L.P. 870,036 1,211,576 Annually 1.5% Venor Capital Partners, L.P. 1,500,000 1,577,606 Quarterly 1.8% --------------------------------------------------------- Total Event Driven 14,777,213 17,292,640 20.1% Global Macro Anglian Commodities U.S. Feeder Fund, L.L.C. 900,000 1,032,063 Annually 1.2% Bear Stearns Emerging Markets Macro Fund, L.P. 700,000 803,785 Monthly 0.9% Bridgewater Pure Alpha Trading Fund I 1,112,167 1,248,284 Monthly 1.4% Drawbridge Global Macro Fund, L.P. 1,352,845 1,798,332 Quarterly 2.1% Gondwana Fund, Ltd. 850,000 822,225 Monthly 1.0% Grinham Diversified Fund Ltd. 800,000 784,517 Monthly 0.9% GSA Capital Macro Partners, L.P. 700,000 684,864 Monthly 0.8% Red Kite Compass Fund, L.P. 500,000 573,750 Quarterly 0.7% ---------------------------- ----- Total Global Macro 6,915,012 7,747,820 9.0% Long/Short Equity Artha Emerging Markets Fund, L.P. 1,050,000 1,505,040 Quarterly 1.8% Blue Crest Equity Fund, L.P. 1,650,000 1,638,828 Quarterly 1.9% Bonanza Partners L.P. 1,250,000 1,434,326 Quarterly 1.7% Delta Fund Europe L.P. 1,532,438 2,250,741 Quarterly 2.6% Delta Institutional L.P. 1,650,000 1,623,131 Quarterly 1.9% Gandhara Fund L.P. 1,870,000 2,076,287 Quarterly 2.4% Hard Assets Partners, L.P. 1,200,000 1,546,322 Monthly 1.8% Hayground Cove Institutional Partners, L.P. 1,150,000 1,336,084 Quarterly 1.5% Ivory Flagship Fund, L.P. 1,400,000 1,813,578 Monthly 2.1% Kinetics Partners, L.P. 1,260,805 1,769,782 Quarterly 2.1% THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 2 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Schedule of Investments (continued) (unaudited) September 30, 2006 % OF MEMBERS' STRATEGY INVESTMENT FUND COST FAIR VALUE LIQUIDITY CAPITAL -------- --------------- ---- ---------- --------- ------- Prism Partners QP, L.P. $1,575,000 $1,639,872 Quarterly 1.9% Seligman Tech Spectrum Fund LLC 1,375,000 1,620,330 Quarterly 1.9% SR Global, L.P. Asia 1,625,000 2,160,823 Monthly 2.5% TCS Capital II, L.P. 1,475,000 2,001,934 Annually 2.3% Third Coast Capital QP, L.P. 1,400,000 1,398,790 Quarterly 1.6% Torrey Pines Fund, L.L.C 899,024 1,040,476 Quarterly 1.2% Tracer Capital Partners QP, LP 1,700,000 2,033,952 Quarterly 2.4% UC Financials Fund Limited 1,350,000 1,876,981 Monthly 2.2% WF Japan Fund Limited 750,000 774,348 Monthly 0.9% ---------------------------- ----- Total Long/Short Equity 26,162,267 31,541,625 36.7% Relative Value All Blue Limited 1,600,000 1,548,580 Monthly 1.8% Amaranth Capital Partners, LLC 2,150,000 1,021,375 Annually 1.2% Black River Global Multi-Strategy Leveraged Fund, L.L.C. 2,900,000 3,033,179 Annually 3.5% Blue Crest Capital, L.P. 750,000 719,405 Quarterly 0.8% Bogle World Fund, L.P. 2,400,000 2,773,974 Quarterly 3.2% Citadel Wellington Partners, L.L.C 3,400,000 4,394,568 Quarterly 5.1% D.B. Zwirn Special Opportunities, L.P. 1,250,000 1,341,165 Annually 1.6% Ellington Overseas Partners, Ltd. 1,150,000 1,289,183 Annually 1.5% HBK Offshore Fund Ltd. 3,400,000 3,691,894 Quarterly 4.3% Highbridge Asia Opportunities Fund, L.P. 1,150,000 1,154,830 Quarterly 1.4% Julius Baer Diversified Fixed Income Hedge Fund 881,616 977,351 Monthly 1.2% Linden International Ltd. 1,950,000 2,003,714 Quarterly 2.3% Marathon Fund L.P. 1,000,000 1,096,078 Monthly 1.3% ---------------------------- ----- Total Relative Value 23,981,616 25,045,296 29.2% ---------------------------- ----- Total $71,836,108 $81,627,381 95.0% ------ Other Assets in Excess of Liabilities 4,296,731 5.0% ----------- ------ Members' Capital $85,924,112 100.0% =========== ====== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 3 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Statement of Operations (unaudited) For the Six Months Ended September 30, 2006 INVESTMENT INCOME Interest income $ 62,468 EXPENSES Management fees $ 408,588 Professional fees 160,798 Board of Directors fees and expenses 61,233 Administration fees 55,388 Investor services fees 38,563 Insurance fees 32,955 Registration fees 14,438 Custodian fees 8,509 Printing fees 5,000 Other expenses 618 --------- Total expenses 786,090 Management fees waived by Adviser (69,547) --------- Net expenses 716,543 ----------- NET INVESTMENT LOSS (654,075) ----------- Losses from investment fund transactions Net realized loss from investment funds redeemed (234,133) Net change in unrealized depreciation on investment funds (398,307) --------- NET LOSSES FROM INVESTMENT FUNDS TRANSACTIONS (632,440) ----------- NET DECREASE IN MEMBERS' CAPITAL DERIVED FROM OPERATIONS $(1,286,515) ============ THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 4 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Statements of Changes in Members' Capital FOR THE SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30, 2006 MARCH 31, 2006 (UNAUDITED) (UNAUDITED) ------------------ -------------- FROM INVESTMENT ACTIVITIES Net investment loss $ (654,075) $(1,084,665) Net realized gains (losses) of investment funds redeemed (234,133) 998,415 Net change in unrealized appreciation (depreciation) on investment funds (398,307) 7,700,870 ----------- ----------- NET INCREASE (DECREASE) IN MEMBERS' CAPITAL DERIVED FROM OPERATIONS (1,286,515) 7,614,620 FROM MEMBERS' CAPITAL TRANSACTIONS Subscriptions 16,664,810 36,559,361 Redemptions (1,424,904) (27,011,363) Distributions (40,601) (165,055) ----------- ----------- NET CHANGE IN MEMBERS' CAPITAL FROM CAPITAL TRANSACTIONS 15,199,305 9,382,943 ----------- ----------- NET CHANGE IN MEMBERS' CAPITAL 13,912,790 16,997,563 Members' Capital at beginning of period 72,011,322 55,013,759 ----------- ----------- Members' Capital at end of period $85,924,112 $72,011,322 =========== =========== THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 5 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Statement of Cash Flows (unaudited) For the Six Months Ended September 30, 2006 CASH FLOWS FROM OPERATING ACTIVITIES Net decrease in Members' Capital from operations $ (1,286,515) Adjustments to reconcile net decrease in Members' Capital from operations to net cash used in operating activities: Purchases of investment funds (18,475,000) Sales of investment funds 4,652,338 Net realized losses from investment funds redeemed 234,133 Net change in unrealized depreciation on investment funds 398,307 Decrease in investment in investment funds made in advance 3,050,000 Decrease in receivable for investment funds sold 942,015 Increase in receivable from Advisor (43,106) Increase in prepaid expenses (26,635) Increase in other assets (7,823) Increase in management fee payable 120,634 Decrease in professional fees payable (86,252) Increase in taxes payable 65,118 Increase in board preparation fees payable 18,750 Increase in registration fees payable 7,403 Increase in administration fees payable 13,334 Increase in investor services fees payable 15,000 Increase in other fees payable 13,063 ------------ NET CASH USED IN OPERATING ACTIVITIES (10,395,236) ------------ CASH FLOWS FROM FINANCING ACTIVITIES Subscriptions 16,663,381 Redemptions (1,424,904) Distributions (40,601) ------------ NET CASH PROVIDED BY FINANCING ACTIVITIES 15,197,876 ------------ NET INCREASE IN CASH 4,802,640 Cash and cash equivalents at beginning of period 182,231 ------------ Cash and cash equivalents at end of period $ 4,984,871 ============ SUPPLEMENTAL DISCLOSURE OF CASH FLOW ACTIVITY Taxes paid $ 983 ------------ THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 6 The Topiary Master Fund for Benefit Plan Investors (BPI) LLC Financial Highlights PERIOD FROM THE FOLLOWING REPRESENTS OCTOBER 1, 2004 THE RATIOS TO AVERAGE (COMMENCEMENT NET ASSETS AND OTHER FOR THE SIX OF OPERATIONS) FINANCIAL HIGHLIGHTS MONTHS ENDED YEAR ENDED THROUGH MARCH INFORMATION FOR THE SEPTEMBER 30, 2006 MARCH 31, 2006 31, 2005 PERIOD/YEAR: (UNAUDITED) (UNAUDITED) (UNAUDITED) --------------------------------------------------------- Ratios to average net assets: Net investment loss (b) (1.60%)(a) (1.60%) (1.67%)(a) Net expenses (b)(c) 1.75% (a) 1.75% 1.75% (a) Total return (1.43%)(d) 11.27% 5.04% (d) Portfolio turnover rate 6% 39% 3% Members' Capital, end of period (thousands) $ 85,924 $72,011 $55,014(a) Annualized for periods of less than one year. (b) The Adviser waived $69,547 of fees for the six months ended September 30, 2006. The net investment loss ratio would have been 0.17% greater and the total expenses ratio would have been 0.17% greater had these fees and expenses not been waived and reimbursed by the Adviser. The Adviser waived and reimbursed $113,973 and $265,284 of fees and expenses for the periods ended March 31, 2006 and 2005, respectively. The net investment loss ratio would have been 0.17% and 1.17% greater and the total expenses ratio would have been 0.17% and 1.17% greater had these fees and expenses not been waived and reimbursed by the Adviser. (c) Expense ratios for the underlying Investment Funds are not included in the Fund's expense ratio. (d) Not annualized. The above ratios and total returns are calculated for all Members taken as a whole. An individual investor's return may vary from these returns based on the timing of capital transactions. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. 7 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC NOTES TO FINANCIAL STATEMENTS (UNAUDITED) -------------------------------------------------------------------------------- 1. ORGANIZATION The Topiary Master Fund for Benefit Plan Investors (BPI) LLC (the "Fund") was organized as a Delaware limited liability company on July 16, 2004. The Fund is registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as a closed-end, non-diversified, management investment company. The Fund's interests (the "Interests") are registered under the Securities Act of 1933, as amended (the "1933 Act"), but are subject to substantial limits on transferability and resale. The Fund's investment objective is to generate long-term capital appreciation through a diversified portfolio with volatility that is lower than that of the equity markets and returns that demonstrate little to no correlation with either equity or bond markets. The Fund acts as a "Master Fund" utilizing capital generated by investments by The Topiary Offshore Fund for Benefit Plan Investors (BPI) LDC (the "Offshore Fund") and through direct investments by other Members. The Offshore Fund's capital is generated by investments by The Topiary Fund for Benefit Plan Investors (BPI) LLC (the "Onshore Fund"). At September 30, 2006, the investment by the Offshore Fund constitutes 98.7% of the investment capital of the Master Fund, and the Onshore Fund constitutes 100% of the investment capital of the Offshore Fund. The balance of the Fund's capital, approximately 1.3%, comprises a direct investment by DBAH Capital LLC, an affiliate of DB Investment Managers, Inc. The Fund will attempt to achieve its investment objective by investing in the securities of approximately 50 to 100 Investment Funds (the "Investment Funds") to be managed pursuant to various alternatives or non-traditional investment strategies, which may be viewed as encompassing four broadly defined primary categories; Relative Value; Event Driven; Long/Short Equity; and Global Macro. The Fund commenced operations on October 1, 2004. The Fund's Board of Directors (the "Board") has overall responsibility to manage and control the business operations of the Fund on behalf of the members (the "Members"). All of the Board are and will be persons who are not "interested persons" (as defined in the 1940 Act) with respect to the Fund. DB Investment Managers, Inc. (the "Adviser") serves as the investment adviser of the Fund subject to the ultimate supervision of and subject to any policies established by the Board, pursuant to the terms of an investment management agreement with the Fund (the "Investment Management Agreement"). Pursuant to the Investment Management Agreement, the Adviser provides the Fund with ongoing investment guidance, policy direction, and monitoring of the Fund. The Adviser is an indirect wholly owned subsidiary of Deutsche Bank AG ("Deutsche Bank"), an international commercial and investment banking group, and is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act"). Generally, initial and additional applications for interests by eligible investors may be accepted at such times as the Fund may determine. The Fund reserves the right to reject any applications for interests in the Fund. The Fund from time to time may offer to 8 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONTINUED) -------------------------------------------------------------------------------- 1. ORGANIZATION (CONTINUED) repurchase Interests. These repurchases will be made at such times and on such terms as may be determined by the Board, in its complete and absolute discretion. On behalf of non-U.S. Members the Fund withholds and pays taxes on U.S. source income allocated from Investment Funds. 2. SIGNIFICANT ACCOUNTING POLICIES A. PORTFOLIO VALUATION The net asset value of the Fund is determined by or at the direction of the Adviser as of the last business day of each month in accordance with the valuation principles set forth below or as may be determined from time to time pursuant to policies established by the Board. The net asset value of the Fund equals the value of the Fund's assets less the Fund's liabilities, including accrued fees and expenses. The Fund's investments in the Investment Funds are considered to be illiquid and can only be redeemed periodically. The Board has approved procedures pursuant to which the Fund values its investments in Investment Funds at fair value. In accordance with these procedures, fair value as of each month-end ordinarily is the value determined as of such month-end for each Investment Fund in accordance with the Investment Fund's valuation policies and reported at the time of the Fund's valuation. As a general matter, the fair value of the Fund's interest in an Investment Fund represents the amount that the Fund could reasonably expect to receive from an Investment Fund if the Fund's interest were redeemed at the time of the valuation, based on information reasonably available at the time the valuation is made and that the Fund believes to be reliable. In the event that an Investment Fund does not report a month-end value to the Fund on a timely basis, the Fund would determine the fair value of such Investment Fund based on the most recent value reported by the Investment Fund, as well any other relevant information available at the time the Fund values its portfolio. The values assigned to these investments are based on available information and do not necessarily represent amounts that might ultimately be realized, as such amounts depend on future circumstances and cannot reasonably be determined until the individual investments are actually liquidated. B. INCOME RECOGNITION AND SECURITY TRANSACTIONS Interest income is recorded on an accrual basis. Dividend income is recorded on the ex-dividend date. Realized gains and losses from investment fund transactions are calculated on the identified cost basis. Investments are recorded on the effective date of the subscription in the Investment Fund. 9 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONTINUED) -------------------------------------------------------------------------------- 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) C. FUND COSTS The Fund bears all expenses incurred in its business other than those that the Adviser assumes. The expenses of the Fund include, but are not limited to, the following: all costs and expenses related to investment transactions and positions for the Fund's account; legal fees; accounting and auditing fees; custodial fees; costs of computing the Fund's net asset value; costs of insurance; registration expenses; due diligence, including travel and related expenses; expenses of meetings of the Board and Members; all costs with respect to communications to Members; and other types of expenses as may be approved from time to time by the Board. D. INCOME TAXES The Fund intends to operate and has elected to be treated as a partnership for Federal income tax purposes. Accordingly, no provision for the payment of Federal, state or local income taxes has been provided. Each Member is individually required to report on its own tax return its distributive share of the Fund's taxable income or loss. On behalf of the Fund's foreign members', the Fund withholds and pays taxes on U.S. source income and U.S. effectively connected income, if any, allocated from underlying Investment Funds to the extent such income is not exempted from withholdings under the Internal Revenue Code and Regulations there under. Such amounts are treated by the Members as withholding tax credits for federal income tax purposes. The actual amount of such taxes is not known until all K-1s from underlying funds are received, usually in the following tax year. Prior to the final determination, the amount of the tax is estimated based on information available. The final tax could be different from the estimated tax and the difference could be significant. E. CASH AND CASH EQUIVALENTS Cash and cash equivalents consist of monies on deposit at PNC Bank, N.A. The Fund treats all financial instruments that mature within three months as cash equivalents. F. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Adviser to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Adviser believes that the estimates utilized in preparing the Fund's financial statements are reasonable and prudent; however, actual results could differ from these estimates. 10 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONTINUED) -------------------------------------------------------------------------------- 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) H. EXPENSE LIMITATION Pursuant to the Expense Limitation Agreement, the Adviser has contractually agreed to waive fees and/or reimburse the Fund's expenses to the extent necessary to ensure that the Fund's annualized expenses (excluding the Incentive Allocation, if any) will not exceed 1.75%. The initial term of the Expense Limitation Agreement is the first fiscal year of the Fund's operations, and will be automatically renewed for each fiscal year thereafter unless the Adviser provides written notice to the Fund and the Master Fund of the termination of the Expense Limitation Agreement at least 30 days prior to the end of the then-current term. 3. MANAGEMENT FEE, RELATED PARTY TRANSACTIONS AND OTHER The Adviser provides certain management and administration services to the Fund, including, among other things, providing office space and other support services. In consideration for such management services, the Fund pays the Adviser a monthly management fee (the "Management Fee") at an annual rate of 1.00% of the Fund's month end net assets, including assets attributable to the Adviser (or its affiliates) and before giving effect to any repurchases by the Fund. The Management Fee accrues monthly and is payable at the end of each quarter. Management fee for the six months ended September 30, 2006 was $408,588 of which $227,537 was payable at period end. The Adviser has contractually agreed to a waiver of its fees and/or reimbursement of the Fund's expenses to the extent necessary so that the Fund's annualized expenses do not exceed 1.75% ("Expense Limitation Agreement") during the year through March 31, 2006. For the six months ended September 30, 2006, the Adviser waived management fees of $69,547. In accordance with the terms of the administration agreement (the "Administration Agreement") and with the approval of the Fund's Board, PFPC, Inc. (an affiliate of PNC Bank, N.A.) ("PFPC") serves as the Fund's administrator pursuant to the administration agreement between PFPC and the Fund. Under the Administration Agreement, PFPC provides administrative and accounting services to the Fund. As compensation for services set forth herein that are rendered by PFPC during the term of this Agreement, the Fund pays PFPC a fee for services rendered. The Fund has entered into an investor services agreement with PFPC, whereby PFPC provides investor services and transfer agency functions for the Fund. As compensation for services set forth herein that are rendered by PFPC during the term of this Agreement, the Fund pays PFPC a fee for services rendered. The Adviser has also retained one of its affiliates, Investment Company Capital Corporation ("ICCC"), to provide sub-administration services pursuant to the Board services agreement. 11 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONTINUED) -------------------------------------------------------------------------------- 3. MANAGEMENT FEE, RELATED PARTY TRANSACTIONS AND OTHER (CONTINUED) Under this agreement, ICCC, among other things: drafts Board agendas and resolutions; prepares Board materials; communicates with the Directors; and drafts Board-meeting minutes. As compensation for services set forth herein that are rendered by ICCC during the term of this Agreement, the Funds pays ICCC a fee for services rendered. Each Board member who is not an employee of the Adviser, or one of its affiliates, receives an annual retainer of $8,000 plus a fee for each meeting attended. The chairman of the audit committee also receives an additional annual fee of $1,000. These Board members are also reimbursed by the Fund for all reasonable out of pocket expenses. PFPC Trust Company (also an affiliate of PNC Bank, N.A.) serves as custodian of the Fund's assets and provides custodial services to the Fund. Under the terms of an investor servicing agreement (the " Underwriting Agreement") between the Fund and Scudder Distributors, Inc. (the "Distributor"), the Distributor is authorized to retain brokers, dealers and certain financial advisers ("Investor Service Providers") to provide ongoing investor services and account maintenance services to Members that are their customers. The Distributor bears all of its expenses of providing distribution services as described under the Underwriting Agreement. 4. SECURITY TRANSACTIONS As of September 30, 2006, the Fund had investments in Investment Funds, none of which were related parties. Aggregate purchases of Investment Funds amounted to $18,475,000 and aggregate sales of Investment Funds amounted to $4,652,338 for the six months ended September 30, 2006. At September 30, 2006, the estimated cost of investments for Federal income tax purposes was $71,836,108. As of that date, net unrealized appreciation on investments was estimated to be $9,791,273, made up of gross unrealized appreciation on investments of $11,099,558 and gross unrealized depreciation on investments of $1,308,285. 5. FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK In the normal course of business, the Investment Funds in which the Fund invests trade various financial instruments and enter into various investment activities with off-balance sheet risk. These include, but are not limited to, short selling activities, writing option contracts, contracts for differences, and interest rate, credit default and total return equity swaps contracts. The Fund's risk of loss in these Investment Funds is limited to the value of these investments reported by the Fund. The Fund itself does not invest in securities with off-balance sheet risk. 12 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC NOTES TO FINANCIAL STATEMENTS (UNAUDITED)(CONTINUED) -------------------------------------------------------------------------------- 6. CONCENTRATION OF RISK The Master Fund invests primarily in Investment Funds that are not registered under the 1940 Act and invest in and actively trade securities and other financial instruments using different strategies and investment techniques, including leverage, that may involve significant risks. These Investment Funds may invest a high percentage of their assets in specific sectors of the market in order to achieve a potentially greater investment return. As a result, the Investment Funds may be more susceptible to economic, political, and regulatory developments in a particular sector of the market, positive or negative, and may experience increased volatility of the Investment Funds' net asset value. Various risks are also associated with an investment in the Fund, including risks relating to the multi-manager structure of the Fund, risks relating to compensation arrangements and risks relating to limited liquidity. 7. GUARANTOR OBLIGATIONS AND INDEMNIFICATIONS In the normal course of business, the Fund enters into contracts that contain a variety of warranties and representations that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund's management expects the risk of loss to be remote. 8. RECENT ACCOUNTING PRONOUNCEMENT On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" (FIN 48). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is required for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. At this time, management is evaluating the implications of FIN 48 and its impact in the financial statements has not yet been determined. 9. SUBSEQUENT EVENT In October 2006, the Fund effected subscriptions from Members of $3,351,678, of which $3,221,728 were received prior to October 1, 2006. 13 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC DIRECTORS AND OFFICERS BIOGRAPHICAL DATA (UNAUDITED) -------------------------------------------------------------------------------- The business of the Fund is managed under the direction of the Board. Subject to the provisions of the Operating Agreement and Delaware law, the Directors have all powers necessary and convenient to carry out the responsibility. The Directors and Officers of the Fund, their addresses, their ages and descriptions of their principal occupations during the past five years are listed below. ------------------------------------------------------------------------------------------------------------------------------------ NUMBER OF PORTFOLIOS TERM OF PRINCIPAL IN FUND POSITION(S) OFFICE(i) & OCCUPATION(S) COMPLEX OTHER HELD WITH LENGTH OF DURING THE PAST OVERSEEN BY DIRECTORSHIPS NAME, ADDRESS AND AGE FUND TIME SERVED 5 YEARS DIRECTOR HELD BY DIRECTOR ------------------------------------------------------------------------------------------------------------------------------------ INDEPENDENT DIRECTORS ------------------------------------------------------------------------------------------------------------------------------------ Nolan T. Altman (ii) Director Since President, NTA 3 Director, State c/o The Topiary Master Fund for inception Consulting (financial University of New York at Benefit Plan Investors (BPI) LLC services consulting) Albany Foundation (1998 25 DeForest Ave. (2001 to present). to present); Director, Summit, NJ 07901-2154 Formerly, Chief Phinity Offshore Fund, (9/18/55) Financial Officer, Ltd., Tiger Asia Overseas Tiger Management Fund, Ltd. Offshore Fund; (Investment adviser Tiger Global, Ltd., TS I to hedge funds) (1993 Offshore Limited (2004 to to 2001). present); Tiger Consumer Partners Offshore Fund, Ltd (2006). ---------------------------------------------------------------------------------------------------------------------------------------------- (i) Each Director serves for the duration of the Fund, or until his death, resignation, termination, removal or retirement. (ii) Since March 2003, Messrs. Altman and Citron have served as members of the Conflicts Advisory Board of certain private investment funds managed by DBIM or its affiliates. This Conflicts Advisory Board meets on an intermittent basis to evaluate whether specific transactions involving the private investment funds raise conflicts of interest with DBIM, its affiliates, or accounts managed by DBIM or its affiliates. 14 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC DIRECTORS AND OFFICERS BIOGRAPHICAL DATA (CONTINUED)(UNAUDITED) -------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------ NUMBER OF PORTFOLIOS TERM OF PRINCIPAL IN FUND POSITION(S) OFFICE(i) & OCCUPATION(S) COMPLEX OTHER HELD WITH LENGTH OF DURING THE PAST OVERSEEN BY DIRECTORSHIPS NAME, ADDRESS AND AGE FUND TIME SERVED 5 YEARS DIRECTOR HELD BY DIRECTOR ------------------------------------------------------------------------------------------------------------------------------------ INDEPENDENT DIRECTORS (CONTINUED) ------------------------------------------------------------------------------------------------------------------------------------ Louis S. Citron (ii) Director Since General Counsel, New 3 None c/o The Topiary Master Fund for Inception Enterprise Associates Benefit Plan Investors (BPI) LLC (venture capital firm) 25 DeForest Ave. (2001 to present). Summit, NJ 07901-2154 (1/31/65) ------------------------------------------------------------------------------------------------------------------------------------ 15 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC DIRECTORS AND OFFICERS BIOGRAPHICAL DATA (CONTINUED)(UNAUDITED) -------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------ NUMBER OF PORTFOLIOS TERM OF PRINCIPAL IN FUND POSITION(S) OFFICE(i) & OCCUPATION(S) COMPLEX OTHER HELD WITH LENGTH OF DURING THE PAST OVERSEEN BY DIRECTORSHIPS NAME, ADDRESS AND AGE FUND TIME SERVED 5 YEARS DIRECTOR HELD BY DIRECTOR ------------------------------------------------------------------------------------------------------------------------------------ INDEPENDENT DIRECTORS (CONTINUED) ------------------------------------------------------------------------------------------------------------------------------------ Edward T. Tokar Director Since Sr. Managing Director 3 Director, Gabelli c/o The Topiary Master Fund for Inception of Investments, Beacon Dividend & Income Benefit Plan Investors (BPI) LLC Trust Co. (2004 to Trust (2003 to 25 DeForest Ave. present); Chief present); Trustee, Summit, NJ 07901-2154 Executive Officer, Levco Series Trust (6/12/47) Allied Capital Mgmt. Mutual Funds (2 LLC (registered portfolios) (2001 to investment adviser - present); Director, wholly owned subsidiary Allied Capital of Honeywell) (1998 to Manage-ment LLC (1998 2004); and Vice to 2004). Formerly, President - Trustee, Scudder MG Investments, Honeywell Investment Trust International, Inc. (formerly Morgan (advanced technology Grenfell Investment and manufacturer) (1977 Trust (11 portfolios) to 2004). (1994 to 2002). ------------------------------------------------------------------------------------------------------------------------------------ 16 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC DIRECTORS AND OFFICERS BIOGRAPHICAL DATA (CONTINUED)(UNAUDITED) -------------------------------------------------------------------------------- OFFICERS --------------------------------------------------------------------------------------------------------------------- NAME, ADDRESS AND AGE POSITIONS HELD WITH FUND PRINCIPAL OCCUPATION(S) DURING THE LAST 5 YEARS --------------------------------------------------------------------------------------------------------------------- Pamela Kiernan(iii) President Chief Operating Officer, DB Absolute Return DB Absolute Return Strategies Strategies (2005 to present). Formerly, Chief 280 Park Avenue, 9Th Floor Operating Officer - Americas, DB Advisors LLC New York, NY 10017 (2004); Chief Operations Officer - America, Deutsche (9/16/68) Bank Global Equities (2002 to 2004); Business Management - Trading, Deutsche Bank Global Equities (1997 to 2002). --------------------------------------------------------------------------------------------------------------------- Joshua Kestler(iii) Vice President Head of Product Structuring, DB Absolute Return Deutsche Asset Management Strategies (2004 to present); Associate, Schulte 25 DeForest Ave., 2nd Floor Roth & Zabel LLP (law firm) (2001-2004); Law Clerk, Summit, NJ 07901-2154 Hon. James H. Coleman, New Jersey Supreme Court (04/27/75) (2000-2001). --------------------------------------------------------------------------------------------------------------------- Marielena Glassman(iii) Treasurer, Chief Administration Officer, DB Absolute Return Deutsche Asset Management Principal Strategies (2002 to present). Formerly Global Head 25 DeForest Ave., 2nd Floor Financial & Accounting of Business Management, Deutsche Asset Management Summit, NJ 07901-2154 Officer (1990 to 2002): Co-Head of Global Portfolio (06/06/63) Management product, Bankers Trust Private Banking (1996-1999). --------------------------------------------------------------------------------------------------------------------- Neil Novembre(iii) Assistant Treasurer Head of Fund Accounting, DB Absolute Return Deutsche Asset Management Strategies (2002 to present). Formerly, 25 DeForest Ave., 2nd Floor Assurance/Business Advisory Services, Summit, NJ 07901-2154 PricewaterhouseCoopers, New York (2000-2002); (06/18/73) Rothstein, Kass & Company, New Jersey (hedge fund administrator)(1996-2000). --------------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------- (iii) All Officers also serve in similar capacities as Officers for other funds advised by the Investment Manager or its affiliates. 17 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC DIRECTORS AND OFFICERS BIOGRAPHICAL DATA (CONTINUED)(UNAUDITED) -------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------------ Anthony Conte(iii) Assistant Head of Alternative Assets Compliance (06/2005 to present); Head of Compliance, DB Treasurer Absolute Return Deutsche Asset Management Strategies (2003 to present); Head of Business Risk, 345 Park Avenue DB Absolute Return Strategies (2001 to 2003); Head of New York, NY 10154 Asset Management Compliance, CIBC World Markets Corp. (3/28/69) (1999 to 2001). ------------------------------------------------------------------------------------------------------------------------------------ John H. Kim(iii) Secretary Director and Senior Counsel, Deutsche Asset Management Deutsche Asset Management (asset management division of Deutsche Bank) (2001 to 345 Park Avenue present); Sr. Associate, Wilkie Farr & Gallagher (law New York, NY 10154 firm) (1995 to 2001). (1/9/71) ------------------------------------------------------------------------------------------------------------------------------------ David Goldman Assistant Vice President, Deutsche Asset Management (legal department) (2006 to present); Deutsche Asset Secretary Assistant Vice 345 Park Avenue President, Deutsche Asset Management (2002 to 2005). Management New York, NY 10154 (12/24/73) ------------------------------------------------------------------------------------------------------------------------------------ Philip Gallo Chief Compliance Managing Director (April 2003 to present), Global Head of Asset Management Compliance Deutsche Asset Officer (January 2004 to present and formerly Head of asset Management Compliance (April 2003 Management to December 2004), Deutsche Asset Management. Chief Compliance Officer, DWS, Scudder 345 Park Avenue Family of Funds (October 2004 to present). Prior to joining Deutsche Asset New York, NY 10154 Management, Vice President and Associate General Counsel at Goldman Sachs until March (8/02/62) 2003. ------------------------------------------------------------------------------------------------------------------------------------ The Fund's Statement of Additional Information ("SAI") has additional information about the Fund's Directors and Officers and is available without charge upon request. Contact your financial representative for a free prospectus or SAI. -------------------------------------------------------------------------------- (iii) All Officers also serve in similar capacities as Officers for other funds advised by the Investment Manager or its affiliates. 18 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; SEC FILINGS (UNAUDITED) -------------------------------------------------------------------------------- The Fund invests substantially all of its assets in the securities of Investment Funds, which are privately placed investment vehicles, typically referred to as "hedge funds." These securities do not typically convey traditional voting rights to the holder and the occurrence of corporate governance or other notices for this type of investment is substantially less than that encountered in connection with registered equity securities. However, to the extent the Fund receives notices or proxies from Investment Funds (or receives proxy statements or similar notices in connection with any other portfolio securities); the Fund has delegated proxy voting responsibilities to the Adviser. The Adviser has adopted its own Proxy Voting Policies and Procedures ("Policies"). The Policies address, among other things, conflicts of interest that may arise between the interests of the Fund, and the interests of the Adviser and its affiliates, including the Fund's principal underwriter. A description of the Adviser's Policies is available (i) without charge, upon request, by calling the Fund toll-free at 1-888-262-0695, and (ii) on the SEC's website at WWW.SEC.GOV. In addition, the Fund is required to file new Form N-PX with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The funds Form N-PX is available (i) without charge, upon request, by calling the Fund toll free at 1-888-262-0695 and (ii) on the SEC's website at WWW.SEC.GOV. The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund's Form N-Q filings are available on the SEC's website at WWW.SEC.GOV. Those forms may be reviewed and copied at the SEC's Public Reference Room in Washington D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. 19 THE TOPIARY MASTER FUND FOR BENEFIT PLAN INVESTORS (BPI) LLC COMPONENTS OF NET ASSETS BY INVESTMENT STRATEGY (UNAUDITED) -------------------------------------------------------------------------------- [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA USED IN PRINTED GRAPHIC AS FOLLOWS: Long/Short Equity 36.7% Relative Value 29.2% Event Driven 20.1% Global Macro 9.0% Other Assets 5.0% 20 ITEM 2. CODE OF ETHICS. Not applicable. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Not applicable. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS. Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this form. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. There has been no change, as of the date of this filing, in any of the portfolio managers identified in response to paragraph (a)(1) of this Item in the registrant's most recently filed annual report on Form N-CSR. ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant's board of directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR 240.14a-101), or this Item. ITEM 11. CONTROLS AND PROCEDURES. (a) The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)). (b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant's second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. (a)(1) Not applicable. (a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. (a)(3) Not applicable. (b) Not applicable. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (registrant) The Topiary Master Fund for Benefit Plan Investors (BPI) LLC ------------------------------------------------------------- By (Signature and Title)* /s/ Pamela Kiernan ----------------------------------------------- Pamela Kiernan, President (principal executive officer) Date December 4, 2006 -------------------------------------------------------------------- Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By (Signature and Title)* /s/ Pamela Kiernan ----------------------------------------------- Pamela Kiernan, President (principal executive officer) Date December 4, 2006 -------------------------------------------------------------------- By (Signature and Title)* /s/ Marie Glassman ----------------------------------------------- Marie Glassman, Treasurer, Principal Financial Officer and Accounting Officer (principal financial officer) Date December 4, 2006 -------------------------------------------------------------------- * Print the name and title of each signing officer under his or her signature.