INTRUST FUNDS TRUST, 497, 1997-01-17

INTRUST FUNDS TRUST
497, 1997-01-17

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INTRUST FUNDS TRUST
3435 STELZER ROAD, COLUMBUS, OHIO 43219

GENERAL AND ACCOUNT INFORMATION:
(888) 266-8787

INSTITUTIONAL PREMIUM CLASS AND INSTITUTIONAL
SERVICE CLASS PROSPECTUS

INTRUST BANK, N.A. -- INVESTMENT ADVISER
("INTRUST" OR THE "ADVISER")

BISYS FUND SERVICES --
ADMINISTRATOR, SPONSOR AND DISTRIBUTOR ("BISYS")
- --------------------------------------------------------------------------------

This Prospectus describes five funds, one money market fund (the "Money
Market Fund") and four non-money market funds (the "Non Money Market Funds")
(each a "Fund" and collectively, the "Funds"), all of which are managed by
INTRUST. The Funds and their investment objectives are:

- THE MONEY MARKET FUND SEEKS TO PROVIDE INVESTORS WITH CURRENT INCOME,
LIQUIDITY AND THE MAINTENANCE OF A STABLE NET ASSET VALUE OF $1.00 PER
SHARE BY INVESTING IN HIGH QUALITY, SHORT-TERM OBLIGATIONS.

- THE SHORT-TERM BOND FUND SEEKS TO PROVIDE INVESTORS WITH AS HIGH A LEVEL
OF CURRENT INCOME AS IS CONSISTENT WITH LIQUIDITY AND SAFETY OF PRINCIPAL
BY INVESTING PRIMARILY IN INVESTMENT GRADE SHORT-TERM OBLIGATIONS.

- THE INTERMEDIATE BOND FUND SEEKS TO PROVIDE INVESTORS WITH AS HIGH A
LEVEL OF CURRENT INCOME AS IS CONSISTENT WITH MANAGING FOR TOTAL RETURN
BY INVESTING IN FIXED INCOME SECURITIES.

- THE STOCK FUND SEEKS TO PROVIDE INVESTORS WITH LONG-TERM CAPITAL
APPRECIATION.

- THE INTERNATIONAL MULTI-MANAGER STOCK FUND SEEKS TO PROVIDE INVESTORS
WITH LONG-TERM CAPITAL APPRECIATION BY INVESTING IN EQUITY SECURITIES OF
ISSUERS BASED OUTSIDE OF THE UNITED STATES. THE INTERNATIONAL
MULTI-MANAGER STOCK FUND SEEKS TO ACHIEVE ITS OBJECTIVE BY INVESTING ALL
OF ITS INVESTABLE ASSETS IN THE INTERNATIONAL EQUITY PORTFOLIO OF THE AMR
INVESTMENT SERVICES TRUST.

This Prospectus describes the two Classes of shares of each Fund, the
Institutional Service Class and the Institutional Premium Class shares. See
"Other Information -- Capitalization." The Funds are separate investment funds
of INTRUST Funds Trust (the "Trust"), a Delaware business trust and registered
open-end, diversified management investment company.

The International Multi-Manager Stock Fund, unlike other mutual funds which
directly acquire and manage their own portfolios of securities, seeks to achieve
its investment objective by investing all of its investable assets in another
mutual fund whose investment objective and policies are substantially identical.
This two-tiered investment approach is commonly referred to as a master feeder
fund structure.

AN INVESTMENT IN SHARES OF THE TRUST IS NEITHER INSURED NOR GUARANTEED BY
THE U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE MONEY MARKET FUND WILL
BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.

SHARES OF THE TRUST ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, INTRUST OR ANY OF ITS AFFILIATES, AND ARE NOT FEDERALLY INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY
OTHER GOVERNMENT AGENCY, AND MAY INVOLVE INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL.

THIS PROSPECTUS SETS FORTH CONCISELY THE INFORMATION A PROSPECTIVE INVESTOR
SHOULD KNOW BEFORE INVESTING IN ANY OF THE FUNDS AND SHOULD BE READ AND RETAINED
FOR INFORMATION ABOUT EACH FUND.

A Statement of Additional Information (the "SAI"), dated January 8, 1997,
containing additional and more detailed information about the Funds has been
filed with the Securities and Exchange Commission ("SEC") and is hereby
incorporated by reference into this Prospectus. It is available without charge
and can be obtained by writing or calling the Funds at the address or
information number printed above.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

The Date of this Prospectus is January 8, 1997.

<PAGE> 2

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
------
<S> <C>
FUND EXPENSES................................................................. 1
FEE TABLE..................................................................... 1
HIGHLIGHTS.................................................................... 5
THE INVESTMENT POLICIES AND PRACTICES OF THE FUNDS............................ 13
INVESTMENT RESTRICTIONS....................................................... 29
RISKS OF INVESTING IN THE FUNDS............................................... 30
MANAGEMENT OF THE FUNDS....................................................... 33
FUND SHARE VALUATION.......................................................... 42
PURCHASE OF FUND SHARES....................................................... 45
MINIMUM PURCHASE REQUIREMENTS................................................. 46
INDIVIDUAL RETIREMENT ACCOUNTS................................................ 46
EXCHANGE OF FUND SHARES....................................................... 47
REDEMPTION OF FUND SHARES..................................................... 48
DIVIDENDS, DISTRIBUTIONS AND FEDERAL INCOME TAX............................... 50
OTHER INFORMATION............................................................. 53
APPENDIX...................................................................... A-1
</TABLE>

(i)
<PAGE> 3

FUND EXPENSES

The following expense table lists the costs and expenses that an investor
in the Institutional Service Class of shares will incur either directly or
indirectly as a shareholder of a Fund. The information is based upon estimates.
Shareholders in the Institutional Premium Class of shares may be subject to an
additional shareholder servicing charge of up to 0.50% of average daily net
assets.

FEE TABLE

<TABLE>
<CAPTION>
MONEY INTERNATIONAL
MARKET SHORT-TERM INTERMEDIATE MULTI-MANAGER
FUND BOND FUND BOND FUND STOCK FUND STOCK FUND
------ ---------- ------------ ---------- -------------
<S> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on
Purchases (as a percentage of
offering price)..................... None None None None None
Maximum Sales Load Imposed on
Reinvested Dividends (as a
percentage of offering price)....... None None None None None
Deferred Sales Load (as a percentage
of redemption proceeds)............. None None None None None
Redemption Fees(1).................... None None None None None
Exchange Fees......................... None None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net
assets)
Management Fees (after waivers and
reimbursements)(2).................. 0.10% 0.19% 0.29% 0.87% 0.83%
12b-1 Fees (after waivers)(3)......... 0.00% 0.00% 0.00% 0.00% 0.00%
Other Expenses(4)..................... 0.50% 0.56% 0.56% 0.53% 0.87%
------ ---------- ------ ---------- ------
Total Portfolio Operating Expenses
(after waivers and
reimbursements)(2).................. 0.60% 0.75% 0.85% 1.40% 1.70%(5)
======= ========== =========== ========== ==============
</TABLE>

The Purpose of the above table is to assist a shareholder in the
Institutional Service Class of shares in understanding the various costs and
expenses that an investor in the Funds will bear.
- ---------------

(1) Shareholders may be charged a wire redemption fee by their bank for
receiving a wire payment on their behalf.

(2) Absent waivers and reimbursements, Management Fees and Total Portfolio
Operating Expenses would be 0.25% and 0.75% for the Money Market Fund; 0.40%
and 0.96% for the Short-Term Bond Fund; 0.40% and 0.96% for the Intermediate
Bond Fund; 1.00% and 1.53% for the Stock Fund; and 1.25% and 2.12% for the
International Multi-Manager Stock Fund, respectively.

(3) The fee under each Fund's Distribution Plan and Agreement is calculated on
the basis of the average net assets of each Fund at an annual rate not to
exceed 0.25%. The Funds will not incur any distribution expenses during
their first year of operation.

(4) Includes a fee of 0.08% for shareholder servicing.

<PAGE> 4

(5) The International Multi-Manager Stock Fund pays BISYS a 0.15% administrative
fee and has other expenses of 0.63% and the Portfolio pays advisory and
administrative fees, of which the International Multi-Manager Stock Fund
bears its pro rata portion. The Trust's Board of Trustees believes that the
aggregate per share expenses of the Fund and the Portfolio will be
approximately equal to the expenses the Fund would incur if its assets were
invested directly in foreign securities. Management Fees are 0.48% at the
Portfolio level and 0.35% at the Fund level (0.40% at the Fund level without
waivers).

EXAMPLE:(1)

You would pay the following expenses on a $1,000 investment, assuming (1)
5% gross annual return and (2) redemption at the end of each time period:

<TABLE>
<CAPTION>
MONEY INTERNATIONAL
MARKET SHORT-TERM INTERMEDIATE MULTI-MANAGER
FUND BOND FUND BOND FUND STOCK FUND STOCK FUND
------ ---------- ------------ ---------- -------------
<S> <C> <C> <C> <C> <C>
1 year............................ $ 6 $ 8 $ 9 $ 14 $17
3 years........................... $ 19 $ 24 $ 27 $ 44 $54
Without waivers and
reimbursements:
1 year............................ $ 8 $ 10 $ 10 $ 16 $22
3 years........................... $ 24 $ 31 $ 31 $ 48 $66
</TABLE>

- ---------------

(1) This example should not be considered a representation of future expenses
which may be more or less than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual return; actual return may be greater or less than the assumed amount.

2
<PAGE> 5

The following expense table lists the costs and expenses that an investor
in the Institutional Premium Class of shares will incur either directly or
indirectly as a shareholder of a Fund. The information is based upon estimates.
Shareholders in the Institutional Premium Class of shares may be subject to an
additional shareholder servicing charge of up to 0.50% of average daily net
assets to which Institutional Service Class shareholders are not subject.

FEE TABLE

<TABLE>
<CAPTION>
MONEY INTERNATIONAL
MARKET SHORT-TERM INTERMEDIATE MULTI-MANAGER
FUND BOND FUND BOND FUND STOCK FUND STOCK FUND
------ ---------- ------------ ---------- -------------
<S> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on
Purchases (as a percentage of
offering price)..................... None None None None None
Maximum Sales Load Imposed on
Reinvested Dividends (as a
percentage of offering price)....... None None None None None
Deferred Sales Load (as a percentage
of redemption proceeds)............. None None None None None
Redemption Fees(1).................... None None None None None
Exchange Fees......................... None None None None None
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net
assets)
Management Fees (after waivers and
reimbursements)(2).................. 0.10% 0.19% 0.29% 0.87% 0.83%
12b-1 Fees (after waivers)(3)......... 0.00% 0.00% 0.00% 0.00% 0.00%
Other Expenses(4)..................... 1.00% 1.06% 1.06% 1.03% 1.37%
------ ---------- ------ ---------- ------
Total Portfolio Operating Expenses
(after waivers and
reimbursements)(2).................. 1.10% 1.25% 1.35% 1.90% 2.20%(5)
======= ========== =========== ========== ==============
</TABLE>

The purpose of this table is to assist a shareholder in the Institutional
Premium Class of shares in understanding the various costs and expenses that an
investor in the Funds will bear.

- ---------------

(1) Shareholders may be charged a wire redemption fee by their bank for
receiving a wire payment on their behalf.

(2) Absent waivers and reimbursements, Management Fees and Total Portfolio
Operating Expenses would be 0.25% and 1.25% for the Money Market Fund; 0.40%
and 1.46% for the Short-Term Bond Fund; 0.40% and 1.46% for the Intermediate
Bond Fund; 1.00% and 2.03% for the Stock Fund; and 1.25% and 2.62% for the
International Multi-Manager Stock Fund, respectively.

(4) Other expenses include a fee of 0.08% for shareholder servicing and an
additional fee of 0.50% for recordkeeping, communicating with and education
of shareholders, fiduciary services (excluding
[/R]

3
<PAGE> 6

investment management) and asset allocation services. Compensation to
salespersons may vary depending upon which class is sold.

(5) The International Multi-Manager Stock Fund pays BISYS a 0.15% administrative
fee and has other expenses of 1.13% and the Portfolio pays advisory and
administrative fees, of which the International Multi-Manager Stock Fund
bears its pro rata portion. The Trust's Board of Trustees believes that the
aggregate per share expenses of the Fund and the Portfolio will be
approximately equal to the expenses the Fund would incur if its assets were
invested directly in foreign securities. Management Fees are 0.48% at the
Portfolio level and 0.35% at the Fund level (0.40% at the Fund level without
waivers).

EXAMPLE:*

You would pay the following expenses on a $1,000 investment, assuming (1)
5% gross annual return and (2) redemption at the end of each time period:

<TABLE>
<CAPTION>
MONEY INTERNATIONAL
MARKET SHORT-TERM INTERMEDIATE MULTI-MANAGER
FUND BOND FUND BOND FUND STOCK FUND STOCK FUND
------ ---------- ------------ ---------- -------------
<S> <C> <C> <C> <C> <C>
1 year............................ $ 11 $ 13 $ 14 $ 19 $22
3 years........................... $ 35 $ 40 $ 43 $ 60 $69
Without waivers and
reimbursements:
1 year............................ $ 13 $ 15 $ 15 $ 21 $27
3 years........................... $ 40 $ 46 $ 46 $ 64 $81
</TABLE>

- ---------------

*This example should not be considered a representation of future expenses which
may be more or less than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual return; actual return may be greater or less than the assumed amount.

4
<PAGE> 7

HIGHLIGHTS

INVESTMENT OBJECTIVES AND POLICIES OF THE FUNDS

This Prospectus describes five funds, one money market fund and four
non-money market funds (individually a "Fund," and collectively, the "Funds"),
all of which are managed by INTRUST. Each Fund has distinct investment
objectives and policies.

As a matter of fundamental policy, notwithstanding any limitation
otherwise, each Fund is authorized to seek to achieve its investment objective
by investing all of its investable assets in an investment company having
substantially the same investment objective and policies as the Fund.

MONEY MARKET FUND:

MONEY MARKET FUND. The investment objective of the Money Market Fund is to
provide investors with current income, liquidity and the maintenance of a stable
net asset value of $1.00 per share by investing in high quality, U.S.
dollar-denominated short-term obligations which are determined by the Adviser to
present minimal credit risks.

The Money Market Fund may invest in obligations permitted to be purchased
under Rule 2a-7 of the Investment Company Act of 1940 (the "1940 Act")
including, but not limited to, (1) obligations of the U.S. Government or its
agencies or instrumentalities; (2) commercial paper, loan participation
interests, medium-term notes, asset-backed securities and other promissory
notes, including floating or variable rate obligations; and (3) domestic, Yankee
dollar and Eurodollar certificates of deposit, time deposits, bankers'
acceptances, commercial paper, bearer deposit notes and other promissory notes,
including floating or variable rate obligations issued by U.S. or foreign bank
holding companies and their bank subsidiaries, branches and agencies. The Money
Market Fund will invest only in issuers or instruments that at the time of
purchase (1) have received the highest short-term rating by at least two
Nationally Recognized Statistical Rating Organizations ("NRSROs") such as "A-1"
by Standard & Poor's Corporation ("S&P") and "P-1" by Moody's Investors
Services, Inc., ("Moody's"); (2) are single rated and have received the highest
short-term rating by a NRSRO; or (3) are unrated, but are determined to be of
comparable quality by the Adviser pursuant to guidelines approved by the Board
and subject to ratification by the Board. The Money Market Fund may also
purchase securities on a "when-issued" basis and purchase or sell them on a
"forward commitment" basis.

The Money Market Fund will concentrate its investments in obligations
issued by the banking industry. Concentration in this context means the
investment of more than 25% of the Money Market Fund's assets in such industry.
However, for temporary defensive purposes during periods when the Adviser
believes that maintaining this concentration may be inconsistent with the best
interest of shareholders, the Money Market Fund will not maintain this
concentration. The Money Market Fund's policy of concentration in the banking
industry increases the Fund's exposure to market conditions prevailing in that
industry.

The Money Market Fund may also invest in variable rate master demand
obligations which are unsecured demand notes that permit the indebtedness
thereunder to vary, and provide for periodic adjustments in the interest rate.
Because master demand obligations are direct lending arrangements between the
Money Market Fund and the issuer, they are

5
<PAGE> 8

not normally traded. There is no secondary market for the notes; however, the
period of time remaining until payment of principal and accrued interest can be
recovered under a variable rate master demand obligation generally will not
exceed seven days. To the extent this period is exceeded, the obligation in
question would be considered illiquid. Issuers of variable rate master demand
obligations must satisfy the same criteria as set forth for other promissory
notes (e.g., commercial paper). The Money Market Fund will invest in variable
rate master demand obligations only when such obligations are determined by the
Adviser, pursuant to guidelines established by the Board of Trustees, to be of
comparable quality to rated issuers or instruments eligible for investment by
the Money Market Fund. In determining dollar-weighted average portfolio
maturity, a variable rate master demand obligation will be deemed to have a
maturity equal to the longer of the period of time remaining until the next
readjustment of the interest rate or the period of time remaining until the
principal amount can be recovered from the issuer on demand.

Amortized Cost Method of Valuation for the Money Market Fund

Portfolio investments of the Money Market Fund are valued based on the
amortized cost valuation technique pursuant to Rule 2a-7 under the 1940 Act.
Obligations in which the Money Market Fund invests generally have remaining
maturities of 397 days or less, although upon satisfying certain conditions of
Rule 2a-7, the Fund may, to the extent otherwise permissible, invest in
instruments subject to repurchase agreements and certain variable and floating
rate obligations that bear longer final maturities. The dollar-weighted average
portfolio maturity of the Money Market Fund will not exceed 90 days. See the SAI
for an explanation of the amortized cost valuation method.

On behalf of the Fund, the Adviser has entered into a subadvisory agreement
with AMR Investment Services, Inc. ("AMR") pursuant to which AMR will provide
investment advisory services to the Fund.

NON-MONEY MARKET FUNDS:

SHORT-TERM BOND FUND. The objective of the Short-Term Bond Fund is to seek
as high a level of current income as is consistent with liquidity and safety of
principal by investing primarily in investment grade short-term obligations. At
least 65% of its total assets will be invested in bonds that are rated, at the
time of purchase, within the three highest long-term or two highest short-term
rating categories assigned by a nationally recognized statistical rating
organization ("NRSRO"), such as Moody's, S&P or Fitch Investors Services, Inc.,
or which are unrated and determined by the Adviser to be of comparable quality.

The Fund invests in fixed income securities such as U.S. Government
Securities, corporate bonds and asset backed securities (including mortgage
backed securities).

The Fund invests in debt obligations with maturities (or average life in
the case of mortgage-backed and similar securities) ranging from short-term
(including overnight) to 12 years and seeks to maintain an average
dollar-weighted portfolio maturity of between 1 and 3 years. For purposes of
this Fund a "bond" is defined as a debt instrument with a fixed interest rate.

On behalf of the Fund, the Adviser has entered into a subadvisory agreement
with Galliard Capital Management, Inc.

6
<PAGE> 9

("Galliard") pursuant to which Galliard will provide investment advisory
services to the Fund.

INTERMEDIATE BOND FUND. The investment objective of the Intermediate Bond
Fund is to provide as high a level of current income as is consistent with
managing for total return by investing at least 65% of its total assets in fixed
income securities. The Fund invests primarily in high quality fixed income
securities such as U.S. Government securities, corporate bonds and asset-backed
securities (including mortgage-backed securities). A minimum of 65% of the
Fund's total assets will be invested in securities rated "A" or better by a
primary credit rating agency and the Fund will seek to maintain a minimum
average portfolio quality rating of "AA." All securities will be rated "BBB" or
better by a primary credit rating agency at the time of purchase. Fixed income
securities downgraded to below BBB subsequent to purchase may be retained in the
portfolio when deemed by the Adviser to be in the best interest of Fund
shareholders. The Fund may also invest in convertible securities, preferred
stocks and debt of foreign governments or corporations. Futures and/or options
may be used to hedge the portfolio against reinvestment and interest rate risk
when deemed necessary. For purposes of this Fund, a "bond" is defined as a debt
instrument with a fixed interest rate. The dollar-weighted average maturity of
the Intermediate Bond Fund will generally range between three and ten years.

On behalf of the Fund, the Adviser has entered into a subadvisory agreement
with Galliard pursuant to which Galliard will provide investment advisory
services to the Fund.

STOCK FUND. The Fund's investment objective is long-term capital
appreciation. The Fund seeks to achieve this objective through investing at
least 80% of its assets in equity securities and at least 65% of its assets in
preferred and common stocks issued by companies with large market
capitalizations that the Adviser believes sell at reasonable prices relative to
their projected earnings. The Adviser's investment goal is to participate in up
markets while cushioning the portfolio during a downturn. A company with a
market capitalization (outstanding shares multiplied by price per share) of over
$5 billion is considered to have large market capitalization, although the Fund
may also invest to a limited degree in companies that have a market
capitalization between $1 billion and $5 billion. The equity securities in which
the Fund may invest include common stock, convertible securities, preferred
stock, ADRs, and warrants. There is no minimum credit standard with respect to
convertible securities in which the Fund invests, which may give such securities
primarily speculative characteristics. The Fund will normally be invested as
fully as practicable (at least 80%) in equity securities and will normally
invest at least 65% of its assets in companies with large market
capitalizations. The Fund may also invest in high-quality debt securities.

On behalf of the Fund, the Adviser has entered into a subadvisory agreement
with ARK Asset Management ("ARK") pursuant to which ARK will provide investment
advisory service to the Fund.

The Fund will be managed in accordance with the investment philosophy that
ARK has employed for more than ten years in managing large capitalization,
value-oriented accounts. As a value adviser, ARK seeks large capitalization
issues that sell at attractive prices relative to their projected earnings. ARK
believes this approach will permit the Fund to participate in rising markets and
help temper losses

7
<PAGE> 10

in declining markets. In managing the Fund, ARK seeks to outperform the S&P 500
Index over a full market cycle with particular emphasis on minimizing losses
during declining markets.

The Fund's assets may be invested in U.S. Government securities and in
certain short-term, high-quality debt instruments for the following purposes:
(i) to meet anticipated day-to-day operating expenses; (ii) pending the
Portfolio Manager's ability to invest cash inflows; (iii) to invest if Fund
assets are insufficient for effective investment in equities; (iv) to permit the
Fund to meet redemption requests; and (v) for temporary defensive purposes. The
Fund will normally invest in short-term debt instruments that do not have a
maturity of greater than one year. The short-term instruments in which the Fund
may invest include: (i) short-term obligations of the U.S. Government, foreign
governments and their agencies, instrumentalities, authorities or political
subdivisions; (ii) other high-quality short-term debt securities; (iii)
commercial paper, including master notes; (iv) bank obligations, including
certificates of deposit, time deposits and bankers' acceptances; (v) money
market funds; and (vi) repurchase agreements.

INTERNATIONAL MULTI-MANAGER STOCK FUND. The investment objective of the
International Multi-Manager Stock Fund is to realize long-term capital
appreciation. This Fund seeks to achieve its investment objective by investing
all of its investable assets in the International Equity Portfolio (the
"Portfolio"), a series of the AMR Investment Services Trust (the "AMR Trust").
The Portfolio's predecessor Fund, the American AAdvantage International Equity
Fund, a series of the American AAdvantage Funds, commenced operations on August
7, 1991. On November 1, 1995, the American AAdvantage Funds reorganized into a
Hub and Spoke(R) structure.(1) As part of the reorganization, the AMR Trust was
created to serve as the "hub" trust and the American AAdvantage funds served as
one of the initial "spoke" trusts.

The Fund has a fundamental policy that allows it to invest all of its
investable assets in another investment company such as the Portfolio. All other
fundamental investment policies and non-fundamental investment policies of the
Fund and the Portfolio are identical. Although the following discusses the AMR
Board of Trustees ("AMR Trust Board") and the investment policies of the
Portfolio, it applies equally to the Trust's Board of Trustees and the Fund. The
Fund may withdraw its investment from the Portfolio at any time if the Board
determines that it is in the best interests of the Fund and its shareholders to
do so. In such event, the Board would consider alternative arrangements such as
investing all of the Portfolio's assets in another investment company with the
same investment objective as the Fund. No assurance exists that satisfactory
alternative arrangements would be available. AMR currently receives an
investment management fee for its services to the Portfolio in the amount of
0.48% of the average daily net assets of the Portfolio. See "Other Information
- -- International Multi-Manager Stock Fund Structure." INTRUST may receive up to
0.40% of the Fund's average daily net assets for providing advisory services to
the Fund, which services include selecting the Portfolio or other investment
company in which the

- ---------------

(1) Hub and Spoke is a registered service mark of Signature Financial Group,
Inc.

8
<PAGE> 11

Fund invests, monitoring such entity's performance, coordinating the Fund's
relationship with such entity, and communicating with the Fund's Board of
Trustees and shareholders regarding such entity's performance and the Fund's two
tier structure. INTRUST has agreed not to charge its advisory fee to the Fund in
an amount in excess of 0.35% of the average daily net assets of the Fund for the
Fund's first year of operations. INTRUST may receive up to 1.25% of the Fund's
average daily net assets for providing advisory services in the event the Fund
does not invest all of its investable assets in the Portfolio or another
investment company.

The Trust's Board of Trustees believes that the Fund will achieve certain
efficiencies and economies of scale through the Hub and Spoke(TM) structure, and
that the aggregate expenses of the Fund will be less than if the Fund invested
directly in the securities held by the Portfolio. However, other investment
companies that offer their shares to the public also may invest all or
substantially all of their assets in the Portfolio. Accordingly, there may be
other investment companies through which investors can invest indirectly in the
Portfolio. The fees charged by such other investment companies may be higher or
lower than those charged by the Fund, which may reflect, among other things,
differences in the nature and level of the services and features offered by such
companies to their investors. Information about the availability of other
investment companies that invest in the Portfolio can be obtained by calling
(800) 967-9009.

The Portfolio invests primarily in a diversified portfolio of equity
securities of issuers based outside the United States. AMR Investment Services,
Inc. ("AMR") provides investment management services to the Portfolio. Hotchkis
and Wiley ("Hotchkis"), Morgan Stanley Asset Management Inc. ("MSAM") and
Templeton Investment Counsel, Inc. ("Templeton") currently serve as investment
advisers to the Portfolio. Rowe Price-Fleming International, Inc. ("Fleming") is
also an investment adviser of the Portfolio; however, none of the Portfolio's
assets have been allocated to Fleming at this time. Hotchkis, MSAM, Templeton
and Fleming are also referred to herein as the "Portfolio Advisers."

Ordinarily the Portfolio will invest at least 65% of its assets in common
stocks and securities convertible into common stocks of issuers in at least
three different countries located outside the United States. However, excluding
collateral for securities loaned, the Portfolio generally invests in excess of
80% of its assets in such securities. The remainder of the Portfolio's assets
will be invested in non-U.S. debt securities which, at the time of purchase, are
rated in one of the three highest rating categories by any NRSRO or, if unrated,
are deemed to be of comparable quality by the Portfolio Advisers and traded
publicly on a world market, or in cash or cash equivalents, including
obligations that are permitted investments for the Money Market Fund or in other
investment companies. The value of the Portfolio's debt investments will vary in
response to interest rate changes. However, when the Portfolio Advisers deem
that market conditions warrant, the Portfolio may, for temporary defensive
purposes, invest up to 100% of its assets in cash, cash equivalents, other
investment companies and investment grade short-term obligations.

The Portfolio Advisers select securities based upon a country's economic
outlook, market valuation and potential changes in currency exchange rates. When
purchasing equity securities, primary emphasis will be placed on undervalued
securities with above average growth expectations.

9
<PAGE> 12

Overseas investing carries potential risks not associated with domestic
investments. Such risks include, but are not limited to: (1) political and
financial instability abroad, including risk of nationalization or expropriation
of assets and the risk of war; (2) less liquidity and greater volatility of
foreign investments; (3) less public information regarding foreign companies;
(4) less government regulation and supervision of foreign stock exchanges,
brokers and listed companies; (5) lack of uniform accounting, auditing and
financial reporting standards; (6) delays in transaction settlement in some
foreign markets; (7) possibility of an imposition of confiscatory foreign taxes;
(8) possible limitation on the removal of securities or other assets of the
Portfolio; (9) restrictions on foreign investments and repatriation of capital;
(10) currency fluctuations; (11) cost and possible restrictions of currency
conversion; (12) withholding taxes on dividends in foreign countries; and (13)
possibly higher commissions, custodial fees and management costs than in the
U.S. market. These risks are often greater for investments in emerging or
developing countries.

The Portfolio will limit its investment to those in countries which have
been recommended by AMR and which have been approved by the AMR Trust Board.
Countries may be added or deleted with AMR Trust Board approval. In determining
which countries will be approved, the AMR Trust Board will evaluate the risk
factors set forth above and will particularly focus on the ability to repatriate
funds, the size and liquidity aspects of a particular country's market and the
investment climate for foreign investors. The current countries in which the
Portfolio may invest are Australia, Austria, Belgium, Canada, Denmark, Finland,
France, Germany, Hong Kong, Ireland, Italy, Japan, Malaysia, Mexico,
Netherlands, New Zealand, Norway, Singapore, South Korea, Spain, Sweden,
Switzerland and the United Kingdom.

The Portfolio may trade forward foreign currency contracts ("forward
contracts"), which are derivatives, to hedge currency fluctuations of underlying
stock or bond positions, or in other circumstances permitted by the Commodity
Futures Trading Commission ("CFTC"). Forward contracts to sell foreign currency
may be used when the management of the Portfolio believes that the currency of a
particular foreign country may suffer a decline against the U.S. dollar. Forward
contracts are also entered into to set the exchange rate for a future
transaction. In this manner, the Portfolio may protect itself against a possible
loss resulting from an adverse change in the relationship between the U.S.
dollar or other currency which is being used for the security purchase and the
foreign currency in which the security is denominated during the period between
the date on which the security is purchased or sold and the date on which
payment is made or received. Forward contracts involve certain risks which
include, but are not limited to: (1) imperfect correlation between the
securities hedged and the contracts themselves; and (2) possible decrease in the
total return of the Portfolio. Forward contracts are discussed in greater detail
in the SAI.

The Portfolio also may trade currency futures ("futures"), which are
derivatives, for the same reasons as for entering into forward contracts as set
forth above. Futures are traded on U.S. and foreign currency exchanges. The use
of futures also entails certain risks which include, but are not limited to: (1)
less liquidity due to daily limits on price fluctuation; (2) imperfect
correlation between the securities hedged and the contracts themselves;

10
<PAGE> 13

(3) possible decrease in the total return of the Portfolio due to hedging; (4)
possible reduction in value for both the contracts and the securities being
hedged; and (5) potential losses in excess of the amounts invested in the
futures contracts themselves. The Portfolio may not enter into futures contracts
if the purchase or sale of such contract would cause the sum of the Portfolio's
initial and any variation margin deposits to exceed 5% of its total assets.
Futures contracts, which are derivatives, are discussed in greater detail in the
SAI.

Short-Term Trading for the Stock Funds

Under certain market conditions, the Stock Fund and International
Multi-Manager Stock Fund may seek profits by short-term trading. The length of
time a Fund has held a particular security is not generally a consideration in
investment decisions. A change in the number of securities owned by a Fund is
known as "portfolio turnover." To the extent short-term trading strategies are
used, a Fund's portfolio turnover rate may be higher than that of other mutual
funds. Portfolio turnover generally involves some expense to a Fund, including
brokerage commissions or dealer mark-ups and other transaction costs on the sale
of securities and reinvestment in other securities. Such transactions may result
in realization of taxable capital gains.

RISKS OF INVESTING IN THE FUNDS

The Money Market Fund attempts to maintain the net asset value of its
shares at a constant $1.00 per share, although there can be no assurance that
the Money Market Fund will always be able to do so. The Money Market Fund may
not achieve as high a level of current income as other funds that do not limit
their investments to the high quality securities in which the Money Market Fund
invests.

The Money Market Fund's policy of concentrating in the banking industry
increases the Fund's exposure to market conditions prevailing in that industry.
See "Risks of Investing in the Funds" herein.

The price per share of the Non-Money Market Funds will fluctuate with
changes in value of the investments held by each Fund. Additionally, there can
be no assurance that a Fund will achieve its investment objective or be
successful in preventing or minimizing the risk of loss that is inherent in
investing in particular types of securities. Such risks include the sensitivity
of the cash flows and yields of separately traded interest and principal
components of obligations to the rate of principal payments (including
prepayments). With respect to mortgage-backed securities, risks include a
similar sensitivity to the rate of prepayments in that, although the value of
fixed-income securities generally increases during periods of falling interest
rates, as a result of prepayments and other factors, this is not always the case
with respect to mortgage-backed securities. Asset-backed securities involve the
risk that such securities do not usually have the benefit of a complete security
interest in the related collateral. Positions in options, futures and options on
futures involve the risks that such options and futures may fail as hedging
techniques, that the loss from investing in futures transactions is potentially
unlimited and that closing transactions may not be effected where a secondary
liquid market does not exist. Further, investment in the securities of issuers
in any foreign country involves special risks and considerations not typically
associated with investing in U.S. issuers.

An investment in the International Multi-Manager Stock Fund involves
certain risks, depending on the types of investments made

11
<PAGE> 14

and the types of investment techniques employed. All investments by the
International Multi-Manager Stock Fund entail some risk. The International
Multi-Manager Stock Fund's policy of investing directly or indirectly in foreign
issuers entails certain risks in addition to those normally associated with
investments in equity securities. See "Investment Policies and Practices of the
Funds."

By investing solely in the Portfolio, the International Multi-Manager Stock
Fund may achieve certain efficiencies and economies of scale. Nonetheless, this
investment could also have potential adverse effects on the Fund. Investors in
the Fund should consider these risks, as described under "Other Information --
International Multi-Manager Stock Fund Structure."

MANAGEMENT OF THE FUNDS

Advisory Services

INTRUST Bank, N.A. acts as investment adviser to all of the Funds. For its
services, INTRUST receives a fee from each Fund based upon each Fund's average
daily net assets. See "Fee Table" in this Prospectus.

AMR serves as subadviser to the Money Market Fund. Galliard serves as
subadviser to the Intermediate Bond Fund and Short-Term Bond Fund. ARK serves as
subadviser to the Stock Fund. AMR, Galliard and ARK may also be referred to
herein as "subadvisers." For their services, the subadvisers receive a fee based
on the respective Fund's average daily net assets.

The International Multi-Manager Stock Fund currently invests all of its
investable assets in the Portfolio. The International Multi-Manager Stock Fund
may withdraw its investment from the Portfolio, for which AMR serves as
investment manager and Hotchkis, MSAM, Templeton and Fleming all may act as
investment advisers, at any time if the Trust's Board determines that it is in
the best interests of the International Multi-Manager Stock Fund and its
shareholders to do so. See "Other Information -- International Multi-Manager
Stock Fund Structure."

Other Services

BISYS Fund Services ("BISYS") acts as administrator, sponsor and
distributor to the Funds and is sometimes referred to herein as "Administrator"
or "Distributor." For its services, BISYS receives a fee from the Funds based on
each Fund's average daily net assets. See "Management of the Fund" in this
Prospectus. The Distributor distributes the Funds' shares and may be reimbursed
for certain of its distribution-related expenses.

GUIDE TO INVESTING IN THE INTRUST FAMILY OF FUNDS

Purchase orders for the Money Market Fund received by 12:00 noon Eastern
time will become effective that day. Purchase orders for all other Funds
received by your broker or Service Organization in proper form prior to 4:00
p.m., Eastern time will become effective that day.

<TABLE>
<S> <C>
- - Minimum Initial Investment... $1,000
- - Minimum Initial Investment
for IRAs................... $ 250
- - Minimum Subsequent
Investment................. $ 50
</TABLE>

The Funds' shares are purchased at net asset value.

Shareholders may exchange shares between Funds in the Trust by telephone or
mail. Exchanges may not be effected by facsimile.

12
<PAGE> 15

<TABLE>
<S> <C>
- - Minimum initial exchange..... $ 500
(no minimum for subsequent
exchanges)
</TABLE>

Shareholders may redeem shares by telephone, mail, wire, or by writing a
check (the Money Market Fund only). Shares may not be redeemed by facsimile.

- - If a redemption request is received by 12:00 noon Eastern time, proceeds for
the Money Market Fund will be transferred to a designated account that day.

- - Minimum check amount is $500.

- - The Funds reserve the right to redeem involuntarily upon not less than 30
days' notice all shares in a Fund's account which have an aggregate value of
$500 or less.

(Redemption by telephone, wire and check writing is not available for IRAs
and trust relationships of INTRUST.)

All dividends and distributions will be automatically paid in additional
shares at net asset value of the applicable Fund unless cash payment is
requested.

- - Distributions for the Stock Fund and International Multi-Manager Stock Fund
are paid at least once annually and distributions for the other Funds are
paid monthly.

THE INVESTMENT POLICIES AND PRACTICES OF THE FUNDS

Each Fund is a separate investment fund or portfolio, commonly known as a
mutual fund. The Funds are separate portfolios of INTRUST Funds Trust, a
Delaware business trust, organized under the laws of Delaware as an open-end,
management investment company. The Trust's Board of Trustees oversees the
overall management of the Funds and elects the officers of the Trust.

- - The investment objective of the Money Market Fund is to provide investors
with current income, liquidity and the maintenance of a stable net asset
value of $1.00 per share by investing in high quality, short-term
obligations.

- - The investment objective of the Short-Term Bond Fund is to provide investors
with as high a level of current income as is consistent with liquidity and
safety of principal by investing primarily in investment grade short-term
obligations.

- - The investment objective of the Intermediate Bond Fund is to provide
investors with as high a level of current income as is consistent with
managing for total return by investing in fixed income securities.

- - The investment objective of the Stock Fund is to provide investors with
long-term capital appreciation.

- - The investment objective of the International Multi-Manager Stock Fund is to
provide investors long-term capital appreciation.

Each Fund follows its own investment objectives and policies, including
certain investment restrictions. The SAI contains specific investment
restrictions which govern the Funds' investments. Several of those restrictions
and each of the Funds' investment objec-

13
<PAGE> 16

tives are fundamental policies, which means that they may not be changed without
a majority vote of shareholders of the affected Fund. Except for the objectives
and those restrictions specifically identified as fundamental, all other
investment policies and practices described in this Prospectus and in the SAI
are not fundamental and may change solely by approval of the Board of Trustees.
References below to "All Funds" include the Portfolio, except where noted
otherwise.

The following is a description of investment practices of the Funds and the
securities in which they may invest:

U.S. Treasury Obligations (All Funds). The Funds may invest in U.S.
Treasury obligations, which are backed by the full faith and credit of the
United States Government as to the timely payment of principal and interest.
U.S. Treasury obligations consist of bills, notes, and bonds and separately
traded interest and principal component parts of such obligations known as
STRIPS which generally differ in their interest rates and maturities. U.S.
Treasury bills, which have original maturities of up to one year, notes, which
have maturities ranging from one year to 10 years, and bonds, which have
original maturities of 10 to 30 years, are direct obligations of the United
States Government.

U.S. Government Securities (All Funds). U.S. Government securities are
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. U.S. Government securities include debt securities issued or
guaranteed by U.S. Government-sponsored enterprises and federal agencies and
instrumentalities. Some types of U.S. Government securities are supported by the
full faith and credit of the United States Government or U.S. Treasury
guarantees, such as mortgage-backed certificates guaranteed by the Government
National Mortgage Association ("GNMA"). Other types of U.S. Government
securities, such as obligations of the Student Loan Marketing Association,
provide recourse only to the credit of the agency or instrumentality issuing the
obligation. In the case of obligations not backed by the full faith and credit
of the United States Government, the investor must look to the agency issuing or
guaranteeing the obligation for ultimate repayment.

Commercial Paper (All Funds). Commercial paper includes short-term
unsecured promissory notes, variable rate demand notes and variable rate master
demand notes issued by both domestic and foreign bank holding companies,
corporations and financial institutions and United States Government agencies
and instrumentalities. All commercial paper purchased by the Funds is, at the
time of investment, rated in one of the top two (top three with respect to
Short-Term Bond Fund) rating categories of at least one NRSRO, or, if not rated
is, in the opinion of the Adviser, of an investment quality comparable to rated
commercial paper in which the Funds may invest, or, with respect to the Money
Market Fund, (i) rated "P-1" by Moody's and "A-1" or better by S&P or in a
comparable rating category by any two NRSROs that have rated the commercial
paper or (ii) rated in a comparable category by only one such organization if it
is the only organization that has rated the commercial paper.

Corporate Debt Securities (All Funds). The Funds may purchase corporate
debt securities, subject to the rating and quality requirements specified with
respect to each Fund. The Funds may invest in both rated commercial paper and
rated corporate debt obligations of foreign issuers that meet the same quality

14
<PAGE> 17

criteria applicable to investments by the Funds in commercial paper and
corporate debt obligations of domestic issuers. These investments, therefore,
are not expected to involve significant additional risks as compared to the
risks of investing in comparable domestic securities. Generally, all foreign
investments carry with them both opportunities and risks not applicable to
investments in securities of domestic issuers, such as risks of foreign
political and economic instability, adverse movements in foreign exchange rates,
the imposition or tightening of exchange controls or other limitations on
repatriation of foreign capital, changes in foreign governmental attitudes
toward private investment (possibly leading to nationalization, increased
taxation or confiscation of foreign assets) and added difficulties inherent in
obtaining and enforcing a judgment against a foreign issuer of securities should
it default.

Mortgage-Related Securities (All Funds). The Funds are permitted to invest
in mortgage-related securities subject to the rating and quality requirements
specified with respect to each such Fund. Mortgage pass-through securities are
securities representing interests in "pools" of mortgages in which payments of
both interest and principal on the securities are made monthly, in effect,
"passing through" monthly payments made by the individual borrowers on the
mortgage loans which underlie the securities (net of fees paid to the issuer or
guarantor of the securities). Early repayment of principal on mortgage
pass-through securities (arising from prepayments of principal due to sale of
the underlying property, refinancing, or foreclosure, net of fees and costs
which may be incurred) may expose a Fund to a lower rate of return upon
reinvestment of principal. Also, if a security subject to prepayment has been
purchased at a premium, in the event of prepayment the value of the premium
would be lost. Like other fixed-income securities, when interest rates rise, the
value of mortgage-related securities generally will decline; however, when
interest rates decline, the value of mortgage-related securities with prepayment
features may not increase as much as other fixed-income securities. In
recognition of this prepayment risk to investors, the Public Securities
Association (the "PSA") has standardized the method of measuring the rate of
mortgage loan principal prepayments. The PSA formula, the Constant Prepayment
Rate or other similar models that are standard in the industry will be used by
the Funds in calculating maturity for purposes of investment in mortgage-related
securities. The inverse relation between interest rates and value of fixed
income securities will be more pronounced with respect to investments by the
Fund in mortgage-related securities, the value of which may be more sensitive to
interest rate changes.

Payment of principal and interest on some mortgage pass-through securities
(but not the market value of the securities themselves) may be guaranteed by the
full faith and credit of the U.S. Government in the case of securities
guaranteed by GNMA or guaranteed by agencies or instrumentalities of the U.S.
Government (in the case of securities guaranteed by the Federal National
Mortgage Association ("FNMA") or the Federal Home Loan Mortgage Corporation
("FHLMC"), which are supported only by the discretionary authority of the U.S.
Government to purchase the agency's obligations). Mortgage pass-through
securities created by non-governmental issuers (such as commercial banks,
savings and loan institutions, private mortgage insurance companies, mortgage
bankers and other secondary market issuers) may be supported in various forms of
insurance or guarantees issued by governmental entities.

15
<PAGE> 18

Collateralized Mortgage Obligations ("CMOs") are hybrid instruments with
characteristics of both mortgage-backed bonds and mortgage pass-through
securities. Similar to a bond, interest and prepaid principal on a CMO are paid,
in most cases, semi-annually. CMOs may be collateralized by whole mortgage loans
but are more typically collateralized by portfolios of mortgage pass-through
securities guaranteed by GNMA, FHLMC or FNMA. CMOs are structured in multiple
classes, with each class bearing a different stated maturity or interest rate.
The inverse relation between interest rates and value of fixed income securities
will be more pronounced with respect to investments by the Fund in
mortgage-related securities, the value of which may be more sensitive to
interest rate changes.

Asset-Backed Securities (Money Market Fund, Short-Term Bond Fund and
Intermediate Bond Fund). These Funds are permitted to invest in asset-backed
securities, subject to the rating and quality requirements specified with
respect to each such Fund. Through the use of trusts and special purpose
subsidiaries, various types of assets, primarily home equity loans and
automobile and credit card receivables, are being securitized in pass-through
structures similar to the mortgage pass-through structures described above.
Consistent with the Funds' investment objectives, policies and quality
standards, a Fund may invest in these and other types of asset-backed securities
which may be developed in the future.

Asset-backed securities involve certain risks that are not posed by
mortgage-related securities, resulting mainly from the fact that asset-backed
securities do not usually contain the benefit of a complete security interest in
the related collateral. For example, credit card receivables generally are
unsecured and the debtors are entitled to the protection of a number of state
and Federal consumer credit laws, some of which may reduce the ability to obtain
full payment. In the case of automobile receivables, due to various legal and
economic factors, proceeds from repossessed collateral may not always be
sufficient to support payments on these securities. The risks associated with
asset-backed securities are often reduced by the addition of credit enhancements
such as a letter of credit from a bank, excess collateral or a third-party
guarantee.

Municipal Commercial Paper (Short-Term Bond Fund and Intermediate Bond
Fund). Municipal commercial paper is a debt obligation with a stated maturity
of one year or less which is issued to finance seasonal working capital needs or
as short-term financing in anticipation of longer-term debt. Investments in
municipal commercial paper are limited to commercial paper which is rated at the
date of purchase: (i) "P-1" by Moody's and "A-1" or "A-1+" by S&P, "P-2"
(Prime-2) or better by Moody's and "A-2" or better by S&P or (ii) in a
comparable rating category by any two of the NRSROs that have rated commercial
paper or (iii) in a comparable rating category by only one such organization if
it is the only organization that has rated the commercial paper or (iv) if not
rated, is, in the opinion of the Adviser, of comparable investment quality and
within the credit quality policies and guidelines established by the Board of
Trustees.

Issuers of municipal commercial paper rated "P-1" have a "superior capacity
for repayment of short-term promissory obligations." The "A-1" rating for
commercial paper under the S&P classification indicates that the "degree of
safety regarding timely payment is either overwhelming or very strong."
Commercial paper with "overwhelming safety characteristics" will be rated
"A-1+." Commercial

16
<PAGE> 19

paper receiving a "P-2" rating has a strong capacity for repayment of short-term
promissory obligations. Commercial paper rated "A-2" has the capacity for timely
payment although the relative degree of safety is not as overwhelming as for
issues designated "A-1." See the Appendix for a more complete description of
securities ratings.

Municipal Notes (Short-Term Bond Fund and Intermediate Bond
Fund). Municipal notes are generally sold as interim financing in anticipation
of the collection of taxes, a bond sale or receipt of other revenue. Municipal
notes generally have maturities at the time of issuance of one year or less.
Investments in municipal notes are limited to notes which are rated at the date
of purchase: (i) MIG 1 or MIG 2 by Moody's and in a comparable rating category
by at least one other nationally recognized statistical rating organization that
has rated the notes, or (ii) in a comparable rating category by only one such
organization, including Moody's, if it is the only organization that has rated
the notes, or (iii) if not rated, are, in the opinion of the Adviser, of
comparable investment quality and within the credit quality policies and
guidelines established by the Board of Trustees.

Notes rated "MIG 1" are judged to be of the "best quality" and carry the
smallest amount of investment risk. Notes rated "MIG 2" are judged to be of
"high quality, with margins of protection ample although not as large as in the
preceding group."

Municipal Bonds (Short-Term Bond Fund and Intermediate Bond
Fund). Municipal bonds generally have a maturity at the time of issuance of
more than one year. Municipal bonds may be issued to raise money for various
public purposes -- such as constructing public facilities and making loans to
public institutions. There are generally two types of municipal bonds: general
obligation bonds and revenue bonds. General obligation bonds are backed by the
taxing power of the issuing municipality and are considered the safest type of
municipal bond. Revenue bonds are backed by the revenues of a project or
facility -- tolls from a toll road, for example. Certain types of municipal
bonds are issued to obtain funding for privately operated facilities. Industrial
development revenue bonds (which are private activity bonds) are a specific type
of revenue bond backed by the credit and security of a private user, and
therefore investments in these bonds have more potential risk. Investments in
municipal bonds are limited to bonds which are rated at the time of purchase "A"
or better by a NRSRO. Municipal bonds generally have a maturity at the time of
issuance of more than one year.

Common Stocks (Stock Fund and International Multi-Manager Stock
Fund). Common stock represents the residual ownership interest in the issuer
after all of its obligations and preferred stocks are satisfied. Common stock
fluctuates in price in response to many factors, including historical and
prospective earnings of the issuer, the value of its assets, general economic
conditions, interest rates, investor perceptions and market volatility.

Preferred Stocks (Short-Term Bond Fund, Intermediate Bond Fund, Stock Fund,
and International Multi-Manager Stock Fund). Preferred stock has a preference
over common stock in liquidation and generally in dividends as well, but is
subordinated to the liabilities of the issuer in all respects. Preferred stock
may or may not be convertible into common stock. As a general rule, the market
value of preferred stock with a fixed dividend rate and no conversion element
varies inversely with interest rates and perceived credit risk.

17
<PAGE> 20

Because preferred stock is junior to debt securities and other obligations of
the issuer, deterioration in the credit quality of the issuer will cause greater
changes in the value of a preferred stock than in a more senior debt security
with similar stated yield characteristics.

American Depository Receipts (Short-Term Bond Fund, Intermediate Bond Fund,
Stock Fund, and International Multi-Manager Stock Fund). American Depository
Receipts are U.S. dollar-denominated receipts generally issued by domestic
banks, which evidence the deposit with the bank of the common stock of a foreign
issuer and which are publicly traded on exchanges or over-the-counter in the
United States.

These Funds may each invest in both sponsored and unsponsored ADR programs.
There are certain risks associated with investments in unsponsored ADR programs.
Because the non-U.S. company does not actively participate in the creation of
the ADR program, the underlying agreement for service and payment will be
between the depository and the shareholder. The company issuing the stock
underlying the ADR pays nothing to establish the unsponsored facility, as fees
for ADR issuance and cancellation are paid by brokers. Investors directly bear
the expenses associated with certificate transfer, custody and dividend payment.

In an unsponsored ADR program, there also may be several depositories with
no defined legal obligations to the non-U.S. company. The duplicate depositories
may lead to marketplace confusion because there would be no central source of
information to buyers, sellers and intermediaries. The efficiency of
centralization gained in a sponsored program can greatly reduce the delays in
delivery of dividends and annual reports. In addition, with respect to all ADRs
there is always the risk of loss due to currency fluctuations.

Investments in ADRs involve certain risks not typically involved in purely
domestic investments, including future foreign political and economic
developments, and the possible imposition of foreign governmental laws or
restrictions applicable to such investments. Securities of foreign issuers
through ADRs are subject to different economic, financial, political and social
factors. Individual foreign economies may differ favorably or unfavorably from
the U.S. economy in such respects as growth of gross national product, rate of
inflation, capital reinvestment, resources, self-sufficiency and balance of
payments position. With respect to certain countries, there is the possibility
of expropriation of assets, confiscatory taxation, political or social
instability or diplomatic developments which could adversely affect the value of
the particular ADR. There may be less publicly available information about a
foreign company than about a U.S. company, and there may be less governmental
regulation and supervision of foreign stock exchanges, brokers and listed
companies. In addition, such companies may use different accounting and
financial standards (and certain currencies may become unavailable for transfer
from a foreign currency), resulting in a Fund's possible inability to convert
proceeds realized upon the sale of portfolio securities of the affected foreign
companies immediately into U.S. currency. The International Multi-Manager Stock
Fund may also invest in European Depository Receipts (EDRs), which are receipts
issued in bearer form by a European financial institution and traded in European
securities' markets. Investments in EDRs involve similar risks as ADRs.

Investment in Foreign Securities (Short-Term Bond Fund, Intermediate Bond
Fund, Stock Fund and International Multi-Manager

18
<PAGE> 21

Stock Fund). These Funds may each invest in securities of foreign governmental
and private issuers that, except for the International Multi-Manager Stock Fund,
are generally denominated in and pay interest in U.S. dollars. Investments in
foreign securities involve certain considerations that are not typically
associated with investing in domestic securities. There may be less publicly
available information about a foreign issuer than about a domestic issuer.
Foreign issuers also are not generally subject to uniform accounting, auditing
and financial reporting standards comparable to those applicable to domestic
issuers. In addition, with respect to certain foreign countries, interest may be
withheld at the source under foreign income tax laws, and there is a possibility
of expropriation or confiscatory taxation, political or social instability or
diplomatic developments that could adversely affect investments in securities of
issuers located in those countries.

Convertible and Exchangeable Securities (Short-Term Bond Fund, Intermediate
Bond Fund, Stock Fund, and International Multi-Manager Stock Fund). These Funds
are permitted to invest in convertible and exchangeable securities, subject to
the rating and quality requirements specified with respect to each such Fund.
Convertible securities generally offer fixed interest or dividend yields and may
be converted either at a stated price or stated rate for common or preferred
stock. Exchangeable securities may be exchanged on specified terms for common or
preferred stock. Although to a lesser extent than with fixed income securities
generally, the market value of convertible securities tends to decline as
interest rates increase and, conversely, tends to increase as interest rates
decline. In addition, because of the conversion or exchange feature, the market
value of convertible or exchangeable securities tends to vary with fluctuations
in the market value of the underlying common or preferred stock. Debt securities
that are convertible into or exchangeable for preferred or common stock are
liabilities of the issuer but are generally subordinated to senior debt of the
issuer.

Domestic and Foreign Bank Obligations (All Funds). These obligations
include but are not restricted to certificates of deposit, commercial paper,
Yankee dollar certificates of deposit, bankers' acceptances, Eurodollar
certificates of deposit and time deposits, promissory notes and medium-term
deposit notes. The Funds will not invest in any obligations of their affiliates,
as defined under the 1940 Act.

Each Fund limits its investment in United States bank obligations to
obligations of United States banks (including foreign branches). Each Fund
limits its investment in foreign bank obligations to United States
dollar-denominated obligations of foreign banks (including United States
branches of foreign banks) which in the opinion of the Adviser, are of an
investment quality comparable to obligations of United States banks which may be
purchased by the Funds. There is no limitation on the amount of the Funds'
assets which may be invested in obligations of foreign banks meeting the
conditions set forth herein.

Fixed time deposits may be withdrawn on demand by the investor, but may be
subject to early withdrawal penalties which vary depending upon market
conditions and the remaining maturity of the obligation. There are no
contractual restrictions on the right to transfer a beneficial interest in a
fixed time deposit to a third party, although there is no market for such
deposits. Investments in fixed time deposits subject to withdrawal penalties
maturing in more than seven days may not exceed 15% of the value of the net
assets of the Non-Money

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<PAGE> 22

Market Funds and 10% of the value of the net assets of the Money Market Fund.

Obligations of foreign banks involve somewhat different investment risks
than those affecting obligations of United States banks, including the
possibilities that their liquidity could be impaired because of future political
and economic developments, that the obligations may be less marketable than
comparable obligations of United States banks, that a foreign jurisdiction might
impose withholding taxes on interest income payable on those obligations, that
foreign deposits may be seized or nationalized, that foreign governmental
restrictions such as exchange controls may be adopted which might adversely
affect the payment of principal and interest on those obligations and that the
selection of those obligations may be more difficult because there may be less
publicly available information concerning foreign banks, or that the accounting,
auditing and financial reporting standards, practices and requirements
applicable to foreign banks may differ from those applicable to United States
banks. Foreign banks are not subject to examination by any United States
Government agency or instrumentality.

Investments in Eurodollar and Yankee dollar obligations involve additional
risks. Most notably, there generally is less publicly available information
about foreign companies; there may be less governmental regulation and
supervision; they may use different accounting and financial standards; and the
adoption of foreign governmental restrictions may adversely affect the payment
of principal and interest on foreign investments. In addition, not all foreign
branches of United States banks are supervised or examined by regulatory
authorities as are United States banks, and such branches may not be subject to
reserve requirements.

STRIPS and Zero Coupon Securities (All Funds except International
Multi-Manager Stock Fund). Each Fund may invest in separately traded principal
and interest components of securities backed by the full faith and credit of the
United States Treasury. The principal and interests components of United States
Treasury bonds with remaining maturities of longer than ten years are eligible
to be traded independently under the Separate Trading of Registered Interest and
Principal of Securities ("STRIPS") program. Under the STRIPS program, the
principal and interest components are separately issued by the United States
Treasury at the request of depository financial institutions, which then trade
the component parts separately. The interest component of STRIPS may be more
volatile than that of United States Treasury bills with comparable maturities.
In accordance with Rule 2a-7, the Money Market Fund's investments in STRIPS are
limited to those with maturity components not exceeding thirteen months. The
Funds will not actively trade in STRIPS.

The Funds may invest in zero coupon securities. A zero coupon security pays
no interest to its holder during its life and is sold at a discount to its face
value at maturity. The market prices of zero coupon securities generally are
more volatile than the market prices of securities that pay interest
periodically and are more sensitive to changes in interest rates than non-zero
coupon securities having similar maturities and credit qualities.

Variable rate demand obligations (All Funds). Variable rate demand
obligations have a maturity of 397 days or less with respect to the Money Market
Fund or five to twenty years with respect to the Non-Money Market Funds, but
carry with them the right of the holder to put the securities to a remarketing
agent or other entity on short notice, typically

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<PAGE> 23

seven days or less. Generally, the remarketing agent will adjust the interest
rate every seven days (or at other intervals corresponding to the notice period
for the put), in order to maintain the interest rate at the prevailing rate for
securities with a seven-day maturity. The remarketing agent is typically a
financial intermediary that has agreed to perform these services. Variable rate
master demand obligations permit a Fund to invest fluctuating amounts at varying
rates of interest pursuant to direct arrangements between the Funds, as lender,
and the borrower. Because the obligations are direct lending arrangements
between the Funds and the borrower, they will not generally be traded, and there
is no secondary market for them, although they are redeemable (and thus
immediately repayable by the borrower) at principal amount, plus accrued
interest, at any time. The borrower also may prepay up to the full amount of the
obligation without penalty. While master demand obligations, as such, are not
typically rated by credit rating agencies, if not so rated, a Fund may, under
its minimum rating standards, invest in them only if, in the opinion of the
Adviser or Portfolio Advisers, as applicable, they are of an investment quality
comparable to other debt obligations in which the Funds may invest and are
within the credit quality policies, guidelines and procedures established by the
Board of Trustees or AMR Board, as applicable. See the SAI for further details
on variable rate demand obligations and variable rate master demand obligations.

Other Mutual Funds (All Funds). Each Fund may invest in shares of other
open-end, management investment companies, subject to the limitations of the
1940 Act and subject to such investments being consistent with the overall
objective and policies of the Fund making such investment, provided that any
such purchases will be limited to short-term investments in shares of
unaffiliated investment companies. The purchase of securities of other mutual
funds results in duplication of expenses such that investors indirectly bear a
proportionate share of the expenses of such mutual funds including operating
costs, and investment advisory and administrative fees.

Options on Securities (All Funds, except Money Market Fund and
International Multi-Manager Stock Fund). The Funds may purchase put and call
options and write covered put and call options on securities in which each Fund
may invest directly and that are traded on registered domestic securities
exchanges or that result from separate, privately negotiated transactions (i.e.,
over-the-counter (OTC) options). The writer of a call option, who receives a
premium, has the obligation, upon exercise, to deliver the underlying security
against payment of the exercise price during the option period. The writer of a
put, who receives a premium, has the obligation to buy the underlying security,
upon exercise, at the exercise price during the option period.

The Funds may write put and call options on securities only if they are
covered, and such options must remain covered as long as the Fund is obligated
as a writer. A call option is covered if a Fund owns the underlying security
covered by the call or has an absolute and immediate right to acquire that
security without additional cash consideration (or for additional cash
consideration if the underlying security is held in a segregated account by its
custodian) upon conversion or exchange of other securities held in its
portfolio. A put option is covered if a Fund maintains cash, U.S. Treasury bills
or other high grade short-term obligations with a value equal to the exercise
price in a segregated account with its custodian.

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<PAGE> 24

The principal reason for writing put and call options is to attempt to
realize, through the receipt of premiums, a greater current return than would be
realized on the underlying securities alone. In return for the premium received
for a call option, the Funds forego the opportunity for profit from a price
increase in the underlying security above the exercise price so long as the
option remains open, but retain the risk of loss should the price of the
security decline. In return for the premium received for a put option, the Funds
assume the risk that the price of the underlying security will decline below the
exercise price, in which case the put would be exercised and the Fund would
suffer a loss. The Funds may purchase put options in an effort to protect the
value of a security it owns against a possible decline in market value.

Writing of options involves the risk that there will be no market in which
to effect a closing transaction. An exchange-traded option may be closed out
only on an exchange that provides a secondary market for an option of the same
series. OTC options are not generally terminable at the option of the writer and
may be closed out only by negotiation with the holder. There is also no
assurance that a liquid secondary market on an exchange will exist. In addition,
because OTC options are issued in privately negotiated transactions exempt from
registration under the Securities Act of 1933, there is no assurance that the
Funds will succeed in negotiating a closing out of a particular OTC option at
any particular time. If a Fund, as covered call option writer, is unable to
effect a closing purchase transaction in the secondary market or otherwise, it
will not be able to sell the underlying security until the option expires or it
delivers the underlying security upon exercise.

The staff of the SEC has taken the position that purchased options not
traded on registered domestic securities exchanges and the assets used as cover
for written options not traded on such exchanges are generally illiquid
securities. However, the staff has also opined that, to the extent a mutual fund
sells an OTC option to a primary dealer that it considers creditworthy and
contracts with such primary dealer to establish a formula price at which the
fund would have the absolute right to repurchase the option, the fund would only
be required to treat as illiquid the portion of the assets used to cover such
option equal to the formula price minus the amount by which the option is
in-the-money. Pending resolution of the issue, the Funds will treat such options
and, except to the extent permitted through the procedure described in the
preceding sentence, assets as subject to each such Fund's limitation on
investments in securities that are not readily marketable.

Dollar Roll Transactions (Short-Term Bond Fund and Intermediate Bond Fund).
The Fund may enter into dollar roll transactions wherein the Fund sells fixed
income securities, typically mortgage-backed securities, and makes a commitment
to purchase similar, but not identical, securities at a later date from the same
party. Like a forward commitment, during the roll period no payment is made for
the securities purchased and no interest or principal payments on the security
accrue to the purchaser, but the Fund assumes the risk of ownership. The Fund is
compensated for entering into dollar roll transactions by the difference between
the current sales price and the forward price for the future purchase, as well
as by the interest earned on the cash proceeds of the initial sale. Like other
when-issued securities or firm commitment agreements, dollar roll transactions
involve the risk

22
<PAGE> 25

that the market value of the securities sold by the Fund may decline below the
price at which a Fund is committed to purchase similar securities. In the event
the buyer of securities under a dollar roll transaction becomes insolvent, the
Fund's use of the proceeds of the transaction may be restricted pending a
determination by the other party, or its trustee or receiver, whether to enforce
the Fund's obligation to repurchase the securities. The Fund will engage in roll
transactions for the purpose of acquiring securities for its portfolio and not
for investment leverage. The Fund will limit its obligations on dollar roll
transactions to 35 percent of the Fund's net assets.

Swap Agreements (Short-Term Bond Fund and Intermediate Bond Fund). To
manage its exposure to different types of investments, the Fund may enter into
interest rate, currency and mortgage (or other asset) swap agreements and may
purchase and sell interest rate "caps," "floors" and "collars." In a typical
interest rate swap agreement, one party agrees to make regular payments equal to
a floating interest rate on a specified amount (the "notional principal amount")
in return for payments to a fixed interest rate on the same amount for a
specified period. If a swap agreement provides for payment in different
currencies, the parties may also agree to exchange the notional principal
amount. Mortgage swap agreements are similar to interest rate swap agreements,
except that the notional principal amount is tied to a reference pool of
mortgages. In a cap or floor, one party agrees, usually in return for a fee, to
make payments under particular circumstances. For example, the purchaser of an
interest rate cap has the right to receive payments to the extent a specified
interest rate exceeds an agreed upon level; the purchaser of an interest rate
floor has the right to receive payments to the extent a specified interest rate
falls below an agreed upon level. A collar entitles the purchaser to receive
payments to the extent a specified interest rate falls outside an agreed upon
range.

Swap agreements may involve leverage and may be highly volatile; depending
on how they are used, they may have a considerable impact on the Fund's
performance. Swap agreements involve risks depending upon the counterparties
creditworthiness and ability to perform as well as the Fund's ability to
terminate its swap agreements or reduce its exposure through offsetting
transactions. The Adviser monitors the creditworthiness of counterparties to
these transactions and intends to enter into these transactions only when they
believe the counterparties present minimal credit risks and the income expected
to be earned from the transaction justifies the attendant risks.

Futures, Related Options and Options on Stock Indices (Stock Fund). The
Fund may attempt to reduce the risk of investment in equity securities by
hedging a portion of its portfolio through the use of certain futures
transactions, options on futures traded on a board of trade and options on stock
indices traded on national securities exchanges. The Fund may hedge a portion of
its portfolio by purchasing such instruments during a market advance or when the
Adviser anticipates an advance. In attempting to hedge a portfolio, the Fund may
enter into contracts for the future delivery of securities and futures contracts
based on a specific security, class of securities or an index, purchase or sell
options on any such futures contracts, and engage in related closing
transactions. The Fund will use these instruments primarily as a hedge against
changes resulting from market conditions in the values of securities held in its
portfolio or which it intends to purchase.

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<PAGE> 26

A stock index assigns relative weighing to the common stocks in the index,
and the index generally fluctuates with changes in the market values of these
stocks. A stock index futures contract is an agreement in which one party agrees
to deliver to the other an amount of cash equal to a specific dollar amount
times the difference between the value of a specific stock index at the close of
the last trading day of the contract and the price at which the agreement is
made. The Fund will sell stock index futures only if the amount resulting from
the multiplication of the then current level of the indices upon which such
futures contracts are based, and the number of futures contracts which would be
outstanding, do not exceed one-third of the value of the Fund's net assets.

When a futures contract is executed, each party deposits with a broker or
in a segregated custodial account up to 5% of the contract amount, called the
"initial margin," and during the term of the contract, the amount of the deposit
is adjusted based on the current value of the futures contract by payments of
variation margin to or from the broker or segregated account.

In the case of options on stock index futures, the holder of the option
pays a premium and receives the right, upon exercise of the option at a
specified price during the option period, to assume the option writer's position
in a stock index futures contract. If the option is exercised by the holder
before the last trading day during the option period, the option writer delivers
the futures position, as well as any balance in the writer's futures margin
account. If it is exercised on the last trading day, the option writer delivers
to the option holder cash in an amount equal to the difference between the
option exercise price and the closing level of the relevant index on the date
the option expires. In the case of options on stock indexes, the holder of the
option pays a premium and receives the right, upon exercise of the option at a
specified price during the option period, to receive cash equal to the dollar
amount of the difference between the closing price of the relevant index and the
option exercise price times a specified multiple, called the "multiplier."

During a market decline or when the Adviser anticipates a decline, the Fund
may hedge a portion of its portfolio by selling futures contracts or purchasing
puts on such contracts or on a stock index in order to limit exposure to the
decline. This provides an alternative to liquidation of securities positions and
the corresponding costs of such liquidation. Conversely, during a market advance
or when the Adviser anticipates an advance, each Fund may hedge a portion of its
portfolio by purchasing futures, options on these futures or options on stock
indices. This affords a hedge against a Fund not participating in a market
advance at a time when it is not fully invested and serves as a temporary
substitute for the purchase of individual securities which may later be
purchased in a more advantageous manner. Each Fund will sell options on futures
and on stock indices only to close out existing positions.

Interest Rate Futures Contracts (All Funds, except International
Multi-Manager Stock Fund). These Funds may, to a limited extent, enter into
interest rate futures contracts -- i.e., contracts for the future delivery of
securities or index-based futures contracts -- that are, in the opinion of the
Adviser, sufficiently correlated with the Fund's portfolio. These investments
will be made primarily in an attempt to protect a Fund against the effects of
adverse changes in interest rates (i.e., "hedging"). When interest rates are
increasing and portfolio values are falling, the sale of

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<PAGE> 27

futures contracts can offset a decline in the value of a Fund's current
portfolio securities. The Funds will engage in such transactions primarily for
bona fide hedging purposes.

Options on Interest Rate Futures Contracts (All Funds, except International
Multi-Manager Stock Fund). These Funds may purchase put and call options on
interest rate futures contracts, which give a Fund the right to sell or purchase
the underlying futures contract for a specified price upon exercise of the
option at any time during the option period. Each Fund may also write (sell) put
and call options on such futures contracts. For options on interest rate futures
that a Fund writes, such Fund will receive a premium in return for granting to
the buyer the right to sell to the Fund or to buy from the Fund the underlying
futures contract for a specified price at any time during the option period. As
with futures contracts, each Fund will purchase or sell options on interest rate
futures contracts primarily for bona fide hedging purposes.

Foreign Exchange Contracts (International Multi-Manager Stock
Fund). Changes in foreign currency exchange rates will affect the U.S. dollar
values of securities denominated in currencies other than the U.S. dollar. The
rate of exchange between the U.S. dollar and other currencies fluctuates in
response to forces of supply and demand in the foreign exchange markets. These
forces are affected by the international balance of payments and other economic
and financial conditions, government intervention, speculation and other
factors. When investing in foreign securities, the Portfolio usually effects
currency exchange transactions on a spot (i.e., cash) basis at the spot rate
prevailing in the foreign exchange market. The Portfolio incurs foreign exchange
expenses in converting assets from one currency to another.

The Portfolio may enter into foreign currency forward contracts or currency
futures for the purchase or sale of foreign currency to "lock in" the U.S.
dollar price of the securities denominated in a foreign currency or the U.S.
dollar value of interest and dividends to be paid on such securities, or to
hedge against the possibility that the currency of a foreign country in which
the Portfolio has investments may suffer a decline against the U.S. dollar. A
forward currency contract is an obligation to purchase or sell a specific
currency at a future date, which may be any fixed number of days from the date
of the contract agreed upon by the parties, at a price set at the time for the
contract. This method of attempting to hedge the value of the Portfolio's
portfolio securities against a decline in the value of a currency does not
eliminate fluctuations in the underlying prices of the securities. Although the
strategy of engaging in foreign currency transactions could reduce the risk of
loss due to a decline in the value of the hedged currency, it could also limit
the potential gain from an increase in the value of the currency. The Portfolio
does not intend to maintain a net exposure to such contracts where the
fulfillment of the Portfolio's obligations under such contracts would obligate
the Portfolio to deliver an amount of foreign currency in excess of the value of
the Portfolio's portfolio securities or other assets denominated in the
currency. The Portfolio will not enter into these contracts for speculative
purposes and will not enter into non-hedging currency contracts. These contracts
involve a risk of loss if the Portfolio Advisers fail to predict currency values
correctly.

Risks of Options and Futures Contracts. One risk involved in the purchase
and sale of futures and options is that a Fund may not be able to effect closing
transactions at a time

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<PAGE> 28

when it wishes to do so. Positions in futures contracts and options on futures
contracts may be closed out only on an exchange or board of trade that provides
an active market for them, and there can be no assurance that a liquid market
will exist for the contract or the option at any particular time. To mitigate
this risk, each Fund will ordinarily purchase and write options only if a
secondary market for the options exists on a national securities exchange or in
the over-the-counter market. Another risk is that during the option period, if a
Fund has written a covered call option, it will have given up the opportunity to
profit from a price increase in the underlying securities above the exercise
price in return for the premium on the option (although the premium can be used
to offset any losses or add to a Fund's income) but, as long as its obligation
as a writer continues, such Fund will have retained the risk of loss should the
price of the underlying security decline. Investors should note that because of
the volatility of the market value of the underlying security, the loss from
investing in futures transactions is potentially unlimited. In addition, a Fund
has no control over the time when it may be required to fulfill its obligation
as a writer of the option. Once a Fund has received an exercise notice, it
cannot effect a closing transaction in order to terminate its obligation under
the option and must deliver the underlying securities at the exercise price.

The Funds' successful use of stock index futures contracts, options on such
contracts and options on indices depends upon the ability of the Adviser to
predict the direction of the market and is subject to various additional risks.
The correlation between movements in the price of the futures contract and the
price of the securities being hedged is imperfect and the risk from imperfect
correlation increases in the case of stock index futures as the composition of
the Funds' portfolios diverge from the composition of the relevant index. Such
imperfect correlation may prevent the Funds from achieving the intended hedge or
may expose the Funds to risk of loss. In addition, if the Funds purchase futures
to hedge against market advances before they can invest in common stock in an
advantageous manner and the market declines, the Funds might create a loss on
the futures contract. Particularly in the case of options on stock index futures
and on stock indices, the Funds' ability to establish and maintain positions
will depend on market liquidity. The successful utilization of options and
futures transactions requires skills different from those needed in the
selection of the Funds' portfolio securities. The Funds believe that the Adviser
possesses the skills necessary for the successful utilization of such
transactions.

The Funds are permitted to engage in bona fide hedging transactions (as
defined in the rules and regulations of the Commodity Futures Trading
Commission) without any quantitative limitations. Futures and related option
transactions which are not for bona fide hedging purposes may be used provided
the total amount of the initial margin and any option premiums attributable to
such positions does not exceed 5% of each Fund's liquidating value after taking
into account unrealized profits and unrealized losses, and excluding any in-
the-money option premiums paid. The Funds will not market, and are not
marketing, themselves as commodity pools or otherwise as vehicles for trading in
futures and related options. The Funds will segregate liquid assets such as
cash, U.S. Government securities or other liquid high grade debt obligations to
cover the futures and options.

"When-Issued" and "Forward Commitment" Transactions (All Funds). The Funds

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<PAGE> 29

may purchase securities on a when-issued and delayed-delivery basis and may
purchase or sell securities on a forward commitment basis. When-issued or
delayed-delivery transactions arise when securities are purchased by a Fund with
payment and delivery taking place in the future in order to secure what is
considered to be an advantageous price and yield to the Fund at the time of
entering into the transaction. A forward commitment transaction is an agreement
by a Fund to purchase or sell securities at a specified future date. When a Fund
engages in these transactions, the Fund relies on the buyer or seller, as the
case may be, to consummate the sale. Failure to do so may result in the Fund
missing the opportunity to obtain a price or yield considered to be
advantageous. When-issued and delayed-delivery transactions and forward
commitment transactions may be expected to occur a month or more before delivery
is due. However, no payment or delivery is made by a Fund until it receives
payment or delivery from the other party to the transaction. A separate account
containing only liquid assets such as cash, U.S. Government securities, or other
liquid high grade debt obligations equal to the value of purchase commitments
will be maintained until payment is made. Such securities have the effect of
leverage on the Funds and may contribute to volatility of a Fund's net asset
value. For further information, see the SAI.

Loans of Portfolio Securities (All Funds). To increase current income, each
Fund may lend its portfolio securities in an amount up to 33 1/3% of each such
Fund's total assets to brokers, dealers and financial institutions, provided
certain conditions are met, including the condition that each loan is secured
continuously by collateral maintained on a daily mark-to-market basis in an
amount at least equal to the current market value of the securities loaned.
These transactions involve a loan by the applicable Fund and are subject to the
same risks as repurchase agreements. For further information, see the SAI.

Repurchase Agreements (All Funds). The Funds may enter into repurchase
agreements with any bank and broker-dealer which, in the opinion of the
Trustees, presents a minimal risk of bankruptcy. Under a repurchase agreement a
Fund acquires securities and obtains a simultaneous commitment from the seller
to repurchase the securities at a specified time and at an agreed upon yield.
The agreements will be fully collateralized and the value of the collateral,
including accrued interest, marked-to-market daily. The agreements may be
considered to be loans made by the purchaser, collateralized by the underlying
securities. If the seller should default on its obligation to repurchase the
securities, a Fund may experience a loss of income from the loaned securities
and a decrease in the value of any collateral, problems in exercising its rights
to the underlying securities and costs and time delays in connection with the
disposition of securities. The Money Market Fund may not invest more than 10%
and the Non-Money Market Funds may not invest more than 15% of its net assets in
repurchase agreements maturing in more than seven business days or in securities
for which market quotations are not readily available. For more information
about repurchase agreements, see "Investment Policies" in the SAI.

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<PAGE> 30

price. Whenever a Fund enters into a reverse repurchase agreement, it will
establish a segregated account in which it will maintain liquid assets in an
amount at least equal to the repurchase price marked to market daily (including
accrued interest), and will subsequently monitor the account to ensure that such
equivalent value is maintained. The Fund pays interest on amounts obtained
pursuant to reverse repurchase agreements. Reverse repurchase agreements are
considered to be borrowings by a Fund under the 1940 Act.

Risks of Techniques Involving Leverage. Utilization of leveraging involves
special risks and may involve speculative investment techniques. Certain Funds
may borrow for other than temporary or emergency purposes, lend their
securities, enter reverse repurchase agreements, and purchase securities on a
when issued or forward commitment basis. In addition, certain Funds may engage
in dollar roll transactions. Each of these transactions involve the use of
"leverage" when cash made available to the Fund through the investment technique
is used to make additional portfolio investments. The Funds use these investment
techniques only when the Adviser or Portfolio Advisers, as applicable, believe
that the leveraging and the returns available to the Fund from investing the
cash will provide shareholders a potentially higher return.

Leverage exists when a Fund achieves the right to a return on a capital
base that exceeds the investment the Fund has invested. Leverage creates the
risk of magnified capital losses which occur when losses affect an asset base,
enlarged by borrowings or the creation of liabilities, that exceeds the equity
base of the Fund. Leverage may involve the creation of a liability that requires
the Fund to pay interest (for instance, reverse repurchase agreements) or the
creation of a liability that does not entail any interest costs (for instance,
forward commitment transactions).

The risks of leverage include a higher volatility of the net asset value of
a Fund's shares and the relatively greater effect on the net asset value of the
shares caused by favorable or adverse market movements or changes in the cost of
cash obtained by leveraging and the yield obtained from investing the cash. So
long as a Fund is able to realize a net return on its investment portfolio that
is higher than interest expense incurred, if any, leverage will result in higher
current net investment income being realized by such Fund than if the Fund were
not leveraged. On the other hand, interest rates change from time to time as
does their relationship to each other depending upon such factors as supply and
demand, monetary and tax policies and investor expectations. Changes in such
factors could cause the relationship between the cost of leveraging and the
yield to change so that rates involved in the leveraging arrangement may
substantially increase relative to the yield on the obligations in which the
proceeds of the leveraging have been invested. To the extent that the interest
expense involved in leveraging approaches the net return on a Fund's investment
portfolio, the benefit of leveraging will be reduced, and, if the interest
expense on borrowings were to exceed the net return to shareholders, such Fund's
use of leverage would result in a lower rate of return than if the Fund were not
leveraged. Similarly, the effect of leverage in a declining market could be a
greater decrease in net asset value per share than if a Fund were not leveraged.
In an extreme case, if a Fund's current investment income were not sufficient to
meet the interest expense of leveraging, it could be necessary for such Fund to
liquidate certain of its investments at an inappropriate

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<PAGE> 31

time. The use of leverage may be considered speculative.

Portfolio Turnover. The Funds generally will not engage in the trading of
securities for the purpose of realizing short-term profits, but each Fund will
adjust its portfolio as it deems advisable in view of prevailing or anticipated
market conditions or fluctuations in interest rates to accomplish its respective
investment objective. For example, each Fund may sell portfolio securities in
anticipation of an adverse market movement. Other than for tax purposes,
frequency of portfolio turnover will not be a limiting factor if a Fund
considers it advantageous to purchase or sell securities. The Funds do not
anticipate that the respective annual portfolio turnover rates will exceed the
following: Short-Term Bond Fund, 400%; Intermediate Bond Fund, 500%; Stock Fund,
150%; and International Multi-Manager Stock Fund, 100%. A high rate of portfolio
turnover involves correspondingly greater transaction expenses than a lower
rate, which expenses must be borne by each Fund and its shareholders. High
portfolio turnover rates may also make it more difficult for the Funds to
satisfy the requirement for qualification as a regulated investment company
under the Internal Revenue Code of 1986, as amended (the "Code"), that less than
30% of each Fund's gross income in any tax year be derived from gains on the
sale of securities held for less than less than three months.

INVESTMENT RESTRICTIONS
(ALL FUNDS, EXCEPT AS INDICATED)

The Funds also operate under certain investment restrictions. Certain of
the Funds' investment restrictions are listed below. For a complete list of the
Funds' investment restrictions, see the section in the Funds' SAI entitled
"Investment Restrictions." Investment restriction Nos. 2,3,4 and 5 are
fundamental policies of the Funds, which can be changed only when permitted by
law and approved by a majority of the Funds' outstanding voting securities. A
"majority of the outstanding voting securities" means the lesser of (i) 67% of
the shares represented at a meeting at which more than 50% of the outstanding
shares are represented in person or by proxy or (ii) more than 50% of the
outstanding shares. See "Other Information -- Voting." Investment Restriction
No. 1 is a non-fundamental policy of the Funds and can be changed by approval of
a majority of the Board of Trustees.

(1) No Fund may invest more than 15% (10% with respect to the Money Market Fund)
of the aggregate value of its net assets in investments which are illiquid,
or not readily marketable (including repurchase agreements having
maturities of more than seven calendar days, time deposits having
maturities of more than seven calendar days, and securities of foreign
issuers that are not listed on a recognized domestic or foreign securities
exchange).

(2) No Fund may borrow money or pledge or mortgage its assets, except that a
Fund may enter into reverse repurchase agreements or borrow from banks up
to 33 1/3% (10% with respect to the International Multi-Manager Stock Fund)
of the current value of its total net assets for temporary or emergency
purposes or to meet redemptions. Each Fund (except the International
Multi-Manager Stock Fund) has adopted a non-fundamental policy to limit
such borrowing to 10% of its net assets and those borrowings may be secured
by the pledge of not more than 15% of the current value of that Fund's
total net assets (but investments may not be

29
<PAGE> 32

purchased by a Fund while any such borrowings exist).

(3) No Fund may make loans, except loans of portfolio securities and except that
a Fund may enter into repurchase agreements with respect to its portfolio
securities and may purchase the types of debt instruments described in this
Prospectus.

(4) No Fund may invest more than 25% of its total assets in the securities of
any one industry, excluding the Money Market Fund which will invest more
than 25% of its total assets in instruments issued by the banking industry.
For this purpose, U.S. Government securities (and repurchase agreements
related thereto) are not considered securities of a single industry. In
addition, finance companies as a group are not considered a single industry
for purposes of this policy. Wholly-owned subsidiaries of finance companies
will be considered to be in the industries of their parent companies if
their activities are primarily related to financing the activities of their
parent companies.

(5) No Fund will, with respect to 75% of its total assets, invest more than 5%
of its total assets in the securities of any one issuer (except for U.S.
Government securities), or purchase more than 10% of the outstanding voting
securities of any such issuer. The Money Market Fund is subject to these
diversification requirements with respect to 100% of its assets.

If a percentage restriction on investment policies or the investment or use
of assets set forth in this Prospectus are adhered to at the time a transaction
is effected, later changes in percentage resulting from changing asset values
will not be considered a violation.

RISKS OF INVESTING IN THE FUNDS

Certain Risk Considerations

The Money Market Fund attempts to maintain a constant net asset value of
$1.00 per share, although there can be no assurance that the Money Market Fund
will always be able to do so. The Money Market Fund may not achieve as high a
level of current income as other funds that do not limit their investment to the
high quality securities in which the Money Market Fund invests.

The Money Market Fund's Policy of concentrating in the banking industry
could increase the Fund's exposure to economic or regulatory developments
relating to or affecting banks. Banks are subject to extensive governmental
regulation which may limit both the amounts and types of loans and other
financial commitments they can make and the interest rates and fees they can
charge. The financial condition of banks is largely dependent on the
availability and cost of capital funds, and can fluctuate significantly when
interest rates change. In addition, general economic conditions may affect the
financial condition of banks.

The price per share of each of the Non-Money Market Funds will fluctuate
with changes in value of the investments held by the Fund. For example, the
value of a bond Fund's shares will generally fluctuate inversely with the
movements in interest rates and a stock

30
<PAGE> 33

Fund's shares will generally fluctuate as a result of numerous factors,
including but not limited to investors' expectations about the economy and
corporate earnings and interest rates. Shareholders of a Fund should expect the
value of their shares to fluctuate with changes in the value of the securities
owned by that Fund. Additionally, a Fund's investment in smaller companies may
involve greater risks than investments in large companies due to such factors as
limited product lines, markets and financial or managerial resources, and less
frequently traded securities that may be subject to more abrupt price movements
than securities of larger companies.

There is, of course, no assurance that a Fund will achieve its investment
objective or be successful in preventing or minimizing the risk of loss that is
inherent in investing in particular types of investment products. In order to
attempt to minimize that risk, the Adviser monitors developments in the economy,
the securities markets, and with each particular issuer. Also, as noted earlier,
each diversified Fund is managed within certain limitations that restrict the
amount of a Fund's investment in any single issuer.

Foreign Securities (All Funds). Investing in the securities of issuers in
any foreign country, including ADRs and EDRs, involves special risks and
considerations not typically associated with investing in U.S. companies. These
include differences in accounting, auditing and financial reporting standards;
generally higher commission rates on foreign portfolio transactions; the
possibility of nationalization, expropriation or confiscatory taxation; adverse
changes in investment or exchange control regulations (which may include
suspension of the ability to transfer currency from a country); and political
instability which could affect U.S. investments in foreign countries.
Additionally, foreign securities and dividends and interest payable on those
securities may be subject to foreign taxes, including taxes withheld from
payments on those securities. Foreign securities often trade with less frequency
and volume than domestic securities and, therefore, may exhibit greater price
volatility. Additional costs associated with an investment in foreign securities
may include higher custodial fees than apply to domestic custodial arrangements
and transaction costs of foreign currency conversions. Changes in foreign
exchange rates also will affect the value of securities denominated or quoted in
currencies other than the U.S. dollar and, with respect to the Money Market
Fund, may affect the ability to maintain net asset value. A Fund's objectives
may be affected either unfavorably or favorably by fluctuations in the relative
rates of exchange between the currencies of different nations, by exchange
control regulations and by indigenous economic and political developments.
Through a Fund's policies, management endeavors to avoid unfavorable
consequences and to take advantage of favorable developments in particular
nations where, from time to time, it places a Fund's investments. See the SAI
for further information about foreign securities.

Small Capitalization Stocks (Stock Fund). Small capitalization stocks are
more volatile than larger capitalization stocks. The Fund may invest in
relatively new or unseasoned companies, which are in their early stages of
development, or small companies positioned in new and emerging industries.
Securities of small and unseasoned companies present greater risks than
securities of larger, more established companies. The companies in which the
Fund may invest may have relatively small revenues and limited product lines,
and may have a small share of the market for their products or services. Small
companies may

31
<PAGE> 34

lack depth of management. They may be unable to internally generate funds
necessary for growth or potential development or to generate such funds through
external financing on favorable terms. They may be developing or marketing new
products or services for which markets are not yet established and may never
become established. Due to these and other factors, small companies may incur
significant losses, and investments in such companies are therefore speculative.

CERTAIN RISKS OF INVESTING IN THE INTERNATIONAL MULTI-MANAGER STOCK FUND

The International Multi-Manager Stock Fund's investment in the Portfolio
may be affected by the actions of other large investors in the Portfolio, if
any. For example, if the Portfolio had a large investor other than the
International Multi-Manager Stock Fund that redeemed its interest in the
Portfolio, the Portfolio's remaining investors (including the International
Multi-Manager Stock Fund) might, as a result, experience higher pro rata
operating expenses, thereby producing lower returns.

The International Multi-Manager Stock Fund may withdraw its entire
investment from the Portfolio at any time if the Board determines that it is in
the best interests of the International Multi-Manager Stock Fund and its
shareholders to do so. The International Multi-Manager Stock Fund might
withdraw, for example, if there were other investors in the Portfolio with power
to, and who did by a vote of the shareholders of all investors (including the
International Multi-Manager Stock Fund), change the investment objective or
policies of the Portfolio in a manner not acceptable to the Board. A withdrawal
could result in a distribution in kind of portfolio securities (as opposed to a
cash distribution) by the Portfolio. That distribution could result in a less
diversified portfolio of investments for the International Multi-Manager Stock
Fund and could affect adversely the liquidity of the International Multi-Manager
Stock Fund's portfolio. If the International Multi-Manager Stock Fund decided to
convert those securities to cash, it usually would incur brokerage fees or other
transaction costs. If the International Multi-Manager Stock Fund withdrew its
investment from the Portfolio, the Board would consider what action might be
taken, including the management of the International Multi-Manager Stock Fund's
assets in accordance with its investment objective and policies by the Adviser
or the investment of all of the International Multi-Manager Stock Fund's
investable assets in another pooled investment entity having substantially the
same investment objective as the International Multi-Manager Stock Fund. The
inability of the International Multi-Manager Stock Fund to find a suitable
replacement investment, in the event the Board decided not to permit the Adviser
to manage the International Multi-Manager Stock Fund's assets, could have a
significant impact on shareholders of the International Multi-Manager Stock
Fund.

Each investor in the Portfolio, including the International Multi-Manager
Stock Fund, will be liable for all obligations of the Portfolio, but not any
other portfolio of AMR Trust. The risk to an investor in the Portfolio of
incurring financial loss on account of such liability, however, would be limited
to circumstances in which the Portfolio was unable to meet its obligations. Upon
liquidation of the Portfolio, investors would be entitled to share pro rata in
the net assets of the Portfolio available for distribution to investors.

Investors should be aware that the International Multi-Manager Stock Fund,
unlike

32
<PAGE> 35

mutual funds that directly acquire and manage their own portfolios of
securities, seeks to achieve its investment objective by investing all of its
investable assets in the International Equity Portfolio of the AMR Trust, which
is a separate investment company. Since the Fund will invest only in the
Portfolio, the Fund's shareholders will acquire only an indirect interest in the
investments of the Portfolio.

In addition to selling its interests to the International Multi-Manager
Stock Fund, the Portfolio may sell its interests to other non-affiliated
investment companies and/or other institutional investors. All institutional
investors in the Portfolio will pay a proportionate share of the Portfolio's
expenses and will invest in that Portfolio on the same terms and conditions.
However, if another investment company invests all of its assets in the
Portfolio, it would not be required to sell its shares at the same public
offering price as the International Multi-Manager Stock Fund and would be
allowed to charge different sales commissions. Therefore, investors in the
International Multi-Manager Stock Fund may experience different returns from
investors in another investment company that invests exclusively in the
Portfolio. As of the date of this prospectus, the International Multi-Manager
Stock Fund, the American AAdvantage International Equity Fund and the American
AAdvantage International Equity Mileage Fund are the only institutional
investors that have invested all of their assets in the Portfolio. Shareholders
may obtain further information concerning other funds that invest in the
Portfolio by contacting their sales representative or by calling (800) 967-9009.

MANAGEMENT OF THE FUNDS

The business and affairs of each Fund are managed under the direction of
the Board of Trustees. Information about the Trustees, as well as the Trust's
executive officers, may be found in the SAI under the heading "Management --
Trustees and Officers."

THE ADVISER: INTRUST BANK, N.A.

INTRUST Bank, N.A. in Wichita, formerly First National Bank in Wichita,
serves as the Funds' investment adviser under an advisory agreement with the
Trust (the "Advisory Agreement"). Under the Advisory Agreement, the Adviser
invests the assets of the portfolio, and continuously reviews, supervises and
administers the Portfolio's investment program. The Adviser discharges its
responsibilities subject to the supervision of, and policies set by, the
Trustees of the Trust.

The Adviser is a majority-owned subsidiary of INTRUST Financial Corporation
(formerly First Bancorp of Kansas), a bank holding company. The Adviser is a
national banking association which provides a full range of banking and trust
services to clients. As of September 30, 1996, total assets under management
were approximately $1.17 billion. The principal place of business address of the
Adviser is 105 North Main Street, Box One, Wichita, Kansas 67201.

For the advisory services it provides to the Funds, the Adviser receives
fees based on average daily net assets up to the following annualized rates:
Money Market Fund, 0.25%; Short-Term Bond Fund, 0.40%; Intermediate Bond Fund,
0.40%; Stock Fund, 1.00%.

33
<PAGE> 36

INTRUST may receive advisory fees up to 0.40% of the average daily net
assets of the International Multi-Manager Stock Fund when the Fund invests all
of its investable assets in the Portfolio or another investment company. INTRUST
has agreed not to charge its advisory fee to the Fund in an amount in excess of
0.35% of the Fund's average daily net assets for the Fund's first year of
operations. While the Fund invests all of its investable assets in the Portfolio
or another investment company, the Adviser will select such company, monitor the
performance of such company, coordinate the Fund's relationship with such
company and communicate with the Fund's Board of Trustees and shareholders
regarding the performance of such company and the Fund's two-tier structure. In
addition, if the Adviser is not satisfied with the performance of the Portfolio,
the Adviser may recommend to the Board of Trustees other investment companies
for the Fund to invest in, or recommend that the Adviser manage the Fund itself.
The Adviser may receive advisory fees up to 1.25% of the average daily net
assets of the Fund should the Adviser decide not to invest all of the Fund's
investable assets in the Portfolio or another investment company. John S.
Maurer, Jr., Senior Vice President and Chief Investment Officer at INTRUST, is
responsible for the day-to-day management of the Fund. Mr. Maurer has over 22
years of experience in the investment and trust industry, including the
developments of equity and fixed income investment services and individual
portfolio and relationship management.

SUBADVISERS:

AMR INVESTMENT SERVICES, INC. AMR, located at 4333 Amon Carter Boulevard,
MD 5645, Fort Worth, Texas 76155, is a wholly-owned subsidiary of AMR
Corporation, the parent company of American Airlines, Inc., and was organized in
1986 to provide business management, advisory, administrative and asset
management consulting services. American Airlines, Inc. is not responsible for
investments made by AMR. As of September 30, 1996, AMR provides investment
advice with respect to approximately $15.3 billion in assets, including
approximately $10.8 billion of assets on behalf of AMR Corporation and its
primary subsidiary, American Airlines, Inc. For the subadvisory services it
provides to the Money Market Fund, AMR receives from the Adviser and not the
Funds monthly fees based upon average daily net assets at the annual rate of
0.20%.

The Money Market Fund is substantially identical to other pooled accounts,
including investment companies advised by AMR. Set forth below are certain
performance data for such pooled accounts. The Money Market Composite consists
of the American AAdvantage Money Market Fund (from September 1987 to present),
the American Performance Cash Management Fund (from October 1990 to present),
the FUNDS IV Cash Reserve Fund (from September 1994 through September 1996), the
American AAdvantage Money Market Mileage Fund (from November 1995 to present)
and the AMR Investment Services Strategic Cash Business Trust (from July 1996 to
present). Expenses of the portfolios in the Money Market Composite range from
approximately 0.11% for the AMR Investment Services Strategic Cash Business
Trust to approximately 0.85% for the American Performance Cash Management Fund.
The Strategic Business Trust is an unregistered pooled account and as such is
not subject to certain requirements that apply to mutual funds under the
applicable securities, tax and other laws that, if applica-

34
<PAGE> 37

ble, may have adversely affected performance. The data shown below reflects
total return for the periods shown, reduced by the actual expense ratio for such
funds. To the extent such funds had expense waivers or reimbursements in effect
during the periods indicated below, such funds' actual performance would have
been lower had such expense waivers or reimbursements not been in effect.
INTRUST Fund fees and expenses may be higher than such expenses and if applied
would have reduced the performance below. This performance information is deemed
relevant since the AMR accounts have been managed using the same investment
objectives, policies and restrictions and portfolio managers as those used by
INTRUST Money Market Fund. However, this performance data is not necessarily
indicative of the past or future performance of any of the INTRUST Funds. The
AMR pooled accounts and the INTRUST Money Market Fund are separate funds. This
performance does not represent the past performance of the INTRUST Money Market
Fund, which is newly organized and has no performance of its own.

AMR INVESTMENT SERVICES, INC.
MONEY MARKET COMPOSITE
ANNUALIZED TOTAL
RETURN FOR THE PERIOD ENDED
SEPTEMBER 30, 1996

<TABLE>
<CAPTION>
LIPPER INSTITUTIONAL MONEY
MARKET INDEX
--------------------------
<S> <C> <C>
1 Year..................................................... 5.43% 5.27%
3 Years.................................................... 4.95% 4.77%
5 Years.................................................... 4.54% 4.27%
Since Inception (9/1/87)................................... 6.14% 5.85%
</TABLE>

GALLIARD CAPITAL MANAGEMENT, INC. Galliard is sub-adviser to the Short-Term
Bond Fund and the Intermediate Bond Fund. Galliard, a wholly-owned subsidiary of
Norwest Bank Minnesota, was formed July 1, 1995 to specialize in the management
of institutional fixed income portfolios. Karl Tourville and Richard Merriam are
co-managers of the Short-Term Bond Fund and the Intermediate Bond Fund. In his
12 year career at Washington Square Capital Management, Inc. (a subsidiary of
Northwestern National Life Insurance Company) Galliard Principal, Richard
Merriam was manager of the Marketable Security Group which employed a similar
fixed income style with great success. Karl Tourville, formerly head of Fixed
Income at Norwest Investment Management, similarly developed an outstanding
track record as a fixed income manager in his nine year career with Norwest. For
the subadvisory services it provides to the Short-Term Bond Fund and
Intermediate Bond Fund, Galliard receives from the Adviser and not the Funds,
monthly fees based upon daily net assets at the annual rate of 0.125% and
0.125%, respectively.

The investment returns below are actual returns of Galliard's Intermediate
Core Composite ("Galliard's Composite's") of separate accounts which are managed
in an investment style substantially the same as the Intermediate Bond Fund.
This information is not intended to be read as a description of Galliard's

35
<PAGE> 38

past performance with respect to the style utilized for the Short-Term Bond
Fund. To the extent Galliard's corporate returns reflect expense waivers or
reimbursements, actual performance would have been lower had such expense
waivers or reimbursements not been in effect. Galliard's first full year of
investment results are consistent with prior results generated by the firm's
Principals in this management approach which is designed to consistently
outperform a stated benchmark.

GALLIARD COMPOSITE RETURNS

<TABLE>
<CAPTION>
LEHMAN BROTHERS INTERMEDIATE
GOVERNMENT CORPORATE INDEX
----------------------------
<S> <C> <C>
1 Year (ended September 30, 1996)......................... 4.80% 5.13%
</TABLE>

Galliard Composites are calculated weighing the market value of each
component. Accounts are placed in a composite at the end of the first full
calendar quarter following their inception or as agreed upon by the client. All
composites are calculated net of estimated INTRUST Intermediate Bond Fund's
Institutional Service Class fees as set forth in the Fee Table in this
Prospectus. Private accounts are not subject to certain investment limitations,
diversification requirements, and other restrictions imposed by the 1940 Act and
the Internal Revenue Code which, if applicable, may have adversely affected
performance. As a result, portfolio management strategies used on Galliard's
Composites and those for the Fund may vary. Also, fees on Composites are imposed
quarterly rather than daily for mutual funds, which may inflate performance.
This performance does not represent historical performance of the INTRUST
Short-Term Bond Fund or Intermediate Bond Fund which are newly organized and
have no performance of their own. This performance should not be interpreted as
indicative of future performance of any INTRUST Funds, which may be higher or
lower than that shown. Past performance is no guarantee of future results.

ARK ASSET MANAGEMENT, INC. ARK serves as Sub-adviser to the Stock Fund.
Located in New York, ARK's predecessor was established in 1929 as the private
money management division of Lehman Brothers. In 1989, the division became an
independent company when the employees purchased the institutional money
management business from Lehman Brothers. As of September 30, 1996, ARK managed
approximately $22.6 billion, including $12.4 billion in large capitalization
value portfolios, for more than 260 institutional and individual clients, with a
minimum investment size for private accounts of $50 million. For the subadvisory
services it provides to the Stock Fund, ARK receives, from the Adviser and not
the Funds, monthly fees based upon average daily net assets at the annual rate
of 0.45%. The following chart describes the investment personnel that form the
team with ARK primarily responsible for the day to day management of the Fund:

36
<PAGE> 39

<TABLE>
<CAPTION>
YEARS EXPERIENCE
----------------------------------------------------------------
INDIVIDUAL/TITLE WITH ARK INVESTMENT EXPERIENCE RECENT EXPERIENCE
- --------------------------------- --------------------- --------------------------------------
<S> <C> <C>
C. Charles Hetzel,
Vice Chairman.................... 32 ARK or ARK's predecessor -- 32
John E. Bailey,
Managing Director................ 15 ARK -- 2
Loomis, Sayles -- 9
Steven M. Steiner,
Managing Director................ 26 ARK -- 5
Equitable Life -- 9
Wm. G. Steuernagel,
Managing Director................ 23 ARK or ARK's predecessor -- 10
James G. Pontone,
Senior Manager................... 13 ARK -- 1
Mitchell Hutchins Asset Management,
Inc. -- 2
</TABLE>

The table that follows presents performance data for ARK with respect to
its large cap value products and is not necessarily representative of the past
performance of the above-mentioned portfolio managers acting individually or as
a team. Information presented is based on performance data provided by ARK for
accounts ("Accounts") it manages that have investment objectives, policies,
styles and strategies substantially similar to the ones that will be employed in
the INTRUST Stock Fund. The information does not represent the Stock Fund's
performance, as it is newly organized and has no performance record of its own.
The Accounts include ARK's individual and unregistered accounts from April 1,
1985), Amway Mutual Fund, Inc. (from May 1, 1995) and Pilgrim Americas Masters
LargeCap Value Fund (from September 1, 1995). Although the Accounts include some
registered mutual funds, the vast majority of the Accounts are individual and
unregistered accounts primarily managed for tax-exempt investors, and are not
subject to diversification and other requirements that apply to mutual funds
under applicable securities, tax and other laws that, if applicable, may have
adversely affected performance. As a result, portfolio management strategies
used on the Accounts and those used on the Stock Fund may vary in some respects.
Also, fees on the Accounts are imposed quarterly rather than daily for mutual
funds, which may inflate performance. The information should not be considered a
prediction of the future performance of the Stock Fund. The actual performance
may be higher or lower than that shown.

The table shows the total returns for various periods ended September 30,
1996, of ARK's Large Cap Value Product as compared to a relevant unmanaged
market index. The performance shown below is calculated in accordance with AIMR.
To the extent expense waivers or reimbursements were in effect during the period
indicated below, actual returns would have been lower had such expense waivers
or reimbursements not been in effect. The performance shown below is adjusted to
give effect to the projected annual expenses for the Stock Fund's Institutional
Service Class shares during its initial fiscal period as set forth in the Fee
Table in this Prospectus.

37
<PAGE> 40

<TABLE>
<CAPTION>
ANNUALIZED RATES OF
RETURN FOR PERIODS ENDING
SEPTEMBER 30, 1996
-------------------------
ARK S&P 500 INDEX
------- -------------
<S> <C> <C>
1 Year............................................................ 19.30% 20.33%
3 Years........................................................... 18.20% 17.42%
5 Years........................................................... 16.50% 15.23%
10 Years.......................................................... 15.25% 14.99%
Since Inception 4/1/85............................................ 16.28% 15.95%
</TABLE>

INTERNATIONAL EQUITY PORTFOLIO

AMR serves as investment manager and administrator to the Portfolio.
Hotchkis, MSAM and Templeton currently serve as investment advisers to the
Portfolio. Fleming is also an investment adviser of the Portfolio; however, none
of the Portfolio's assets have been allocated to Fleming at this time.

The investment advisory fees payable to AMR by the AMR Trust are 0.48% of
the average annual daily net assets of the Portfolio. With respect to INTRUST's
advisory fee, INTRUST has undertaken not to charge advisory fees in excess of
0.40% of average daily net assets with respect to the International
Multi-Manager Stock Fund as long as the Fund remains completely invested in the
Portfolio or any other investment company. For the Fund's first year of
operations, INTRUST has agreed not to charge its advisory fee to the Fund in an
amount in excess of 0.35% of the average daily net assets of the Fund. The
investment advisory agreement for the International Multi-Manager Stock Fund
provides for an investment advisory fee payable to INTRUST by the Fund of 1.25%
of the average annual daily net assets of the Fund, if the Fund does not invest
all of its assets in the Portfolio or another investment company. All investment
advisory fees are accrued daily and paid monthly.

None of the Portfolio Advisers provide any services to the Portfolio except
for portfolio investment management and related recordkeeping services.

William F. Quinn has served as President of AMR since it was founded in
1986 and Nancy A. Eckl currently serves as Vice President-Trust Investments of
AMR. Ms. Eckl previously served as Vice President-Finance and Compliance of AMR
from December 1990 to May 1995. In these capacities, Mr. Quinn and Ms. Eckl have
primary responsibility for the day-to-day operations of the Portfolio. These
responsibilities include oversight of the Portfolio Advisers, regular review of
each Portfolio Adviser's performance and asset allocations among Portfolio
Advisers.

38
<PAGE> 41

and the Growth and Income Portfolio of the AMR Trust. The advisory contract
provides for AMR to pay Hotchkis and Wiley an annualized fee equal to 0.60% of
the first $10 million of assets under its discretionary management, 0.50% of the
next $140 million of assets, 0.30% on the next $50 million of assets, 0.20% of
the next $800 million of assets and 0.15% of all excess AMR Trust assets managed
by Hotchkis and Wiley.

MORGAN STANLEY ASSET MANAGEMENT INC., 1221 Avenue of the Americas, New
York, New York 10020, is a wholly-owned subsidiary of Morgan Stanley Group Inc.
MSAM provides portfolio management and named fiduciary services to taxable and
nontaxable institutions, international organizations and individuals investing
in United States and international equity and debt securities. As of September
30, 1995, MSAM had assets under management totaling approximately $55.2 billion,
including approximately $40.1 billion under active management and $15.1 billion
as named fiduciary or fiduciary adviser. As of December 31, 1995, MSAM had
investment authority over approximately $404 million of assets of AMR
Corporation and its subsidiaries and affiliated entities. For its services, AMR
pays MSAM an annual fee equal to 0.80% of the first $25 million in AMR Trust
assets under its discretionary management, 0.60% of the next $25 million in
assets, 0.50% of the next $24 million in assets and 0.40% on all excess assets.

ROWE PRICE-FLEMING INTERNATIONAL, INC., 100 East Pratt Street, Baltimore,
Maryland 21020, is a professional investment counseling firm founded in 1979.
Fleming is a joint venture owned entirely by its three parent companies, T. Rowe
Price, Robert Fleming and Jardine Fleming. As of December 31, 1995, Fleming had
assets under management totaling approximately $22.2 billion, including
approximately $197 million of assets of AMR and its subsidiaries and affiliated
entities. Fleming serves as an investment adviser to the Portfolio, although AMR
does not presently intend to allocate assets from the Portfolio to Fleming. For
its services to the Portfolio when total assets under Fleming's management are
less than $200 million, AMR will pay Fleming an annualized fee equal to 0.75% of
the first $20 million, 0.60% of the next $30 million and 0.50% on amounts over
$50 million. When assets under Fleming's management exceed $200 million but are
less than $500 million, AMR will pay Fleming an annualized fee equal to 0.50% on
all assets. When assets under Fleming's management exceed $500 million but are
less than $750 million, AMR will pay an annualized fee equal to 0.45% on all
assets, and when assets exceed $750 million, AMR will pay Fleming a flat fee of
0.40% on all assets. When asset levels are between $184 million and $200
million, Fleming will credit AMR with an adjustment for the difference between
the two fee schedules. The credit is determined by pro-rating the difference
between the original tiered fee and the flat fee ($80,000 per annum at all asset
levels) over the difference between $200 million and the current asset size for
billing purposes.

TEMPLETON INVESTMENT COUNSEL, INC., 500 East Broward Blvd., Suite 2100,
Fort Lauderdale, Florida 33394-3091, is a professional investment counseling
firm which has been providing investment services since 1979. Templeton is
indirectly owned by Franklin Resources, Inc. As of December 31, 1995, Templeton
had discretionary investment management authority with respect to approximately
$14.4 billion of assets, including approximately $288 million of assets of AMR
Corporation and its subsidiaries and affiliated

39
<PAGE> 42

entities. For its services, AMR pays Templeton an annualized fee equal to 0.50%
of the first $100 million in AMR Trust assets under its discretionary
management, 0.35% of the next $50 million in assets, 0.30% of the next $250
million in assets and 0.25% on assets over $400 million.

The AMR Trust and AMR also entered into a Management Agreement dated
October 1, 1995 that obligates AMR to provide or oversee all administrative,
investment advisory and portfolio management services for the AMR Trust.

Solely for the purpose of determining the applicable percentage rates when
calculating the fees for each Portfolio Adviser other than MSAM, there shall be
included all other assets or trust assets of American Airlines, Inc. also under
management by each respective Portfolio Adviser. For the purpose of determining
the applicable percentage rates when calculating MSAM's fees, all equity account
assets managed by MSAM on behalf of American Airlines, Inc. shall be included.
The inclusion of any such assets will result in lower overall fee rates being
applied to the Portfolio.

Based upon the advice of counsel, INTRUST believes that the performance of
investment advisory services for the Funds will not violate the Glass-Steagall
Act or other applicable banking laws or regulations. However, future statutory
or regulatory changes, as well as future judicial or administrative decisions
and interpretations of present and future statutes and regulations, could
prevent INTRUST from continuing to perform such services for the Funds. If
INTRUST were prohibited from acting as investment adviser to the Funds, it is
expected that the Board of Trustees would recommend to shareholders approval of
a new investment advisory agreement with another qualified investment adviser
selected by the Board or that the Board would recommend other appropriate
action.

THE SPONSOR AND DISTRIBUTOR

BISYS, the Funds' Sponsor and Distributor (the "Distributor"), has its
principal office at 3435 Stelzer Road, Columbus, Ohio 43219. The Distributor
will receive orders for, sell, and distribute shares of the Fund. BISYS also
serves as administrator and distributor of other mutual funds.

The Distributor may from time to time pay a bonus or other incentive to
dealers that employ registered representatives who sell a minimum dollar amount
of shares of the Funds. Such bonus or other incentive may take the form of
payment for travel expenses, including lodging, incurred in connection with
trips taken by qualifying registered representatives and members of their
families to places within or without the United States, or other bonuses, such
as gift certificates or the cash equivalent of such bonuses.

The Funds have adopted a Rule 12b-1 Distribution Plan and Agreement (the
"Plan") pursuant to which the Funds may reimburse the Distributor, or others, on
a monthly basis for costs and expenses incurred by the Distributor in connection
with the distribution and marketing of shares of the Funds. These costs and
expenses, which are subject to a maximum limit of 0.25% per annum of the average
daily net assets of the shares of the Funds, include: (i) advertising by radio,
television, newspapers, magazines, brochures, sales literature, direct mail or
any other form of advertising; (ii) expenses of employees or agents of the
Distributor, including salary, commissions, travel and related expenses; (iii)
payments to broker-dealers and financial institutions for

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<PAGE> 43

services in connection with the distribution of shares, including promotional
incentives and fees calculated with reference to the average daily net asset
value of shares held by shareholders who have a brokerage or other service
relationship with the broker-dealer or other institution receiving such fees;
(iv) costs of printing prospectuses, statements of additional information and
other materials to be given or sent to prospective investors; (v) such other
similar services as the Trustees determine to be reasonably calculated to result
in sales of shares of the Funds; (vi) costs of shareholder servicing incurred by
broker-dealers, banks or other financial institutions; and (vii) other direct
and indirect distribution-related expenses, including the provision of services
with respect to maintaining the assets of the Funds. The Funds will pay all
costs and expenses in connection with the preparation, printing and distribution
of its Prospectus to current shareholders and the operation of its Plan,
including related legal and accounting fees. No Fund will be liable for
distribution expenditures made by the Distributor in any given year in excess of
the maximum amount payable under the Plan for that Fund year.

ADMINISTRATIVE SERVICES

The Funds have also entered into an Administrative Services Contract with
BISYS pursuant to which BISYS provides certain management and administrative
services necessary for the Funds' operations, including: (i) general supervision
of the operation of the Funds, including coordination of the services performed
by the Funds' Adviser, transfer agent, custodian, independent accountants and
legal counsel, regulatory compliance, including the compilation of information
for documents such as reports to, and filings with, the SEC and state securities
commissions, and preparation of proxy statements and shareholder reports for the
Funds; (ii) general supervision relative to the compilation of data required for
the preparation of periodic reports distributed to the Funds' officers and Board
of Trustees; and (iii) furnishing office space and certain facilities required
for conducting the business of the Funds. For these services, BISYS receives
from each Fund, except the International Multi-Manager Stock Fund, a fee,
payable monthly, at the annual rate of 0.20% of each Fund's average daily net
assets. For the International Multi-Manager Stock Fund, BISYS is paid 0.15% of
the Fund's average daily net assets for administrative services. Pursuant to a
Services Agreement between the Trust and the Administrator, BISYS assists the
Trust with certain transfer and dividend disbursing agent functions and receives
a fee of $15 per account per year plus out-of-pocket expenses. Pursuant to a
Fund Accounting Agreement between the Trust and the Administrator, the
Administrator assists the Trust in calculating net asset values and provides
certain other accounting services for each Fund described therein, for an annual
fee of $30,000 per Fund plus out-of-pocket expenses.

SERVICE ORGANIZATIONS

Various banks, trust companies, broker-dealers (other than the Sponsor) or
other financial organizations (collectively, "Service Organizations") also may
provide administrative services for the Funds, such as maintaining shareholder
accounts and records. The Funds may pay fees to Service Organizations (which
vary depending upon the services provided) in amounts up to an annual rate of
0.08% of the daily net asset value of the Funds' shares owned by shareholders
with whom the Service Organization has a servicing relationship. The
Institutional Premium Class may pay addi-

41
<PAGE> 44

tional fees to Service Organizations in amounts up to an annual rate of 0.50% of
the daily net asset value of a Fund's shares owned by Shareholders with whom the
Service Organization has a servicing relationship for record keeping,
communication with and education of shareholders, fiduciary services (excluding
investment management) and asset allocation services.

Some Service Organizations may impose additional or different conditions on
their clients, such as requiring their clients to invest more than a Fund's
minimum initial or subsequent investments or charging a direct fee for
servicing. If imposed, these fees would be in addition to any amounts which
might be paid to the Service Organization by the Funds. Each Service
Organization has agreed to transmit to its clients a schedule of any such fees.
Shareholders using Service Organizations are urged to consult with them
regarding any such fees or conditions.

The Glass-Steagall Act and other applicable laws provide that, among other
things, banks may not engage in the business of underwriting, selling or
distributing securities. There is currently no precedent prohibiting banks from
performing administrative and shareholder servicing functions as Service
Organizations. However, judicial or administrative decisions or interpretations
of such laws, as well as changes in either Federal or state regulations relating
to the permissible activities of banks and their subsidiaries or affiliates,
could prevent a bank Service Organization from continuing to perform all or a
part of its servicing activities. If a bank were prohibited from so acting, its
shareholder clients would be permitted to remain shareholders of the Funds and
alternative means for continuing the servicing of such shareholders would be
sought. It is not expected that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences.

OTHER EXPENSES

Each Fund bears all costs of its operations, other than expenses
specifically assumed by BISYS and the Adviser. The costs borne by the Funds
include legal and accounting expenses, Trustees' fees and expenses, insurance
premiums, custodian and transfer agent fees and expenses, expenses incurred in
acquiring or disposing of the Funds' portfolio securities, expenses of
registering and qualifying the Funds' shares for sale with the SEC and with
various state securities commissions, expenses of obtaining quotations on the
Funds' portfolio securities and pricing of the Funds' shares, expenses of
maintaining the Funds' legal existence and of shareholders' meetings, and
expenses of preparing and distributing to existing shareholders reports, proxies
and prospectuses. Each Fund bears its own expenses associated with its
establishment as a series of the Trust; these expenses are amortized over a
five-year period from the commencement of a Fund's operations. See "Management"
in the SAI. Trust expenses directly attributable to a Fund are charged to that
Fund; other expenses are allocated proportionately among all of the Funds in the
Trust in relation to the net assets of each Fund.

FUND SHARE VALUATION

The net asset value per share of the Funds is calculated at 12:00 noon
(Eastern time) for the Money Market Fund and at 4:00 p.m. (Eastern time) for
each of the Non-Money Market Funds, Monday through Friday, on each day the New
York Stock Exchange is open for trading (a "Business Day"), which excludes the
following business holidays: New Year's Day, Presidents' Day, Good Friday,

42
<PAGE> 45

Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day;
and the following additional business holidays for the Money Market Funds:
Martin Luther King's Birthday, Columbus Day and Veterans Day. The net asset
value per share of each share class is computed by dividing the value of the net
assets attributable to each class (i.e., the value of the assets less the
liabilities) by the total number of such class's outstanding shares. All
expenses, including fees paid to the Adviser, the Administrator and the
Distributor, are accrued daily and taken into account for the purpose of
determining the net asset value. Expenses directly attributable to a Fund are
charged to the Fund; other expenses are allocated proportionately among each
Fund within the Trust in relation to the net assets of each Fund, or on another
reasonable basis. Each share class within the Fund is charged with the direct
expenses of that class and with a proportion of the general expenses of the
Fund. These general expenses (e.g., investment advisory fees) are allocated
among the classes of shares based on the relative value of their outstanding
shares.

Securities listed on an exchange are valued on the basis of the last sale
prior to the time the valuation is made. If there has been no sale since the
immediately previous valuation, then the current bid price is used. Quotations
are taken from the exchange where the security is primarily traded. Portfolio
securities which are primarily traded on foreign exchanges may be valued with
the assistance of a pricing service and are generally valued at the preceding
closing values of such securities on their respective exchanges, except that
when an occurrence subsequent to the time a foreign security is valued is likely
to have changed such value, then the fair value of those securities will be
determined by consideration of other factors by or under the direction of the
Board of Trustees. Over-the-counter securities are valued on the basis of the
bid price at the close of business on each business day. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by or at the direction of the Board of Trustees.
Notwithstanding the above, bonds and other fixed-income securities are valued by
using market quotations and may be valued on the basis of prices provided by a
pricing service approved by the Board of Trustees. All assets and liabilities
initially expressed in foreign currencies will be converted into U.S. dollars at
the mean between the bid and asked prices of such currencies against U.S.
dollars as last quoted by any major bank (except for the Portfolio, which
translates such securities at prevailing market rates).

Trading in securities on European, Far Eastern and other international
securities exchanges and over-the-counter markets is normally completed well
before the close of business of each Fund Business Day. In addition, trading in
foreign securities generally or in a particular country or countries may not
take place on all Fund Business Days. Trading does take place in various foreign
markets, however, on days on which the International Multi-Manager Stock Fund's
net asset value is not calculated. Calculation of the net asset value per share
of the International Multi-Manager Stock Fund may not occur contemporaneously
with the determination of the prices of the foreign securities used in the
calculation. Events affecting the values of foreign securities that occur after
the time their prices are determined and before the International Multi-Manager
Stock Fund's determination of net asset value will not be reflected in the
International Multi-Manager Stock Fund's calculation of net asset value unless
the Portfolio

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<PAGE> 46

Advisers determine that the particular event would materially affect net asset
value, in which case an adjustment will be made.

Purchases and sales of securities will often be principal transactions in
the case of debt securities and equity securities traded otherwise than on an
exchange. The purchase or sale of equity securities will frequently involve the
payment of a commission to a broker-dealer who effects the transaction on behalf
of a Fund or the Portfolio. Debt securities normally will be purchased or sold
from or to issuers directly or to dealers serving as market makers for the
securities at a net price. Generally, money market securities are traded on a
net basis and do not involve brokerage commissions. Under the 1940 Act, persons
affiliated with INTRUST, the Funds, the Portfolio or BISYS are prohibited from
dealing with the Funds or the Portfolio as a principal in the purchase and sale
of securities except in accordance with regulations adopted by the SEC. The
Funds may purchase Municipal Obligations from underwriting syndicates of which
INTRUST, BISYS or another affiliate is a member under certain conditions in
accordance with the provisions of a rule adopted under the 1940 Act. Under the
1940 Act, persons affiliated with INTRUST, the Funds, the Portfolio or BISYS may
act as a broker for the Funds or the Portfolio. In order for such persons to
effect any portfolio transactions for the Funds or the Portfolio, the
commissions, fees or other remuneration received by such persons must be
reasonable and fair compared to the commissions, fees or other remunerations
paid to other brokers in connection with comparable transactions involving
similar securities being purchased or sold on an exchange during a comparable
period of time. This standard would allow the affiliate to receive no more than
the remuneration which would be expected to be received by an unaffiliated
broker in a commensurate arm's-length transaction. The Trustees of the Trust and
the Trustees of the AMR Trust regularly review the commissions paid by the Funds
and the Portfolio to affiliated brokers.

As permitted by Section 28(e) of the Securities Exchange Act of 1934 (the
"Act"), the Adviser and Portfolio Advisers may cause the Funds to pay a
broker-dealer which provides "brokerage and research services" (as defined in
the Act) to the Adviser and Portfolio Advisers an amount of disclosed commission
for effecting a securities transaction for the Funds in excess of the commission
which another broker-dealer would have charged for effecting that transaction.

The Adviser and Portfolio Advisers may, in circumstances in which two or
more dealers are in a position to offer comparable results, give preference to a
dealer which has provided statistical or other research services to INTRUST. By
allocating transactions in this manner, INTRUST is able to supplement its
research and analysis with the views and information of securities firms.

Consistent with the Rules of Fair Practice of the National Association of
Securities Dealers, Inc. and subject to seeking the most favorable price and
execution available and such other policies as the Trustees may determine, the
Adviser and Portfolio Adviser may consider sales of shares of the Funds as a
factor in the selection of broker-dealers to execute portfolio transactions for
the Funds.

For the Portfolio in which the International Multi-Manager Stock Fund
invests, the Portfolio Advisers place orders for the purchase and sale of the
Portfolio's assets with brokers and dealers its selects. The Portfolio Advisers
seek the "best execution" for all port-

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<PAGE> 47

folio transactions, but the Portfolio may pay higher than the lowest available
commission rates when the Portfolio Advisers believe it is reasonable to do so
in light of the value for the brokerage and research services provided by the
broker effecting the transaction. Commission rates for brokerage transactions
are fixed on many foreign securities exchanges, and this may cause higher
brokerage expenses to the Portfolio than would be the case for comparable
transactions effected on United States securities exchanges. Subject to the
Portfolio's policy of obtaining the best price consistent with the quality of
execution of transactions, the Portfolio Advisers may employ broker-dealer
affiliates of the Portfolio Advisers to effect brokerage transactions for the
Portfolio. The Portfolio's payment of commission for these affiliated brokers is
subject to procedures adopted by AMR Trust's Board of Trustees to provide that
the commissions will not exceed the usual and customary broker's commissions
charged by unaffiliated brokers. No specific portion of the Portfolio's
brokerage will be directed to an affiliated broker and in no event will a broker
affiliated with the Portfolio Advisers receive brokerage transactions in
recognition of research services provided to any of them.

The Portfolio Advisers anticipate that the annual portfolio turnover rate
in the Portfolio will be less than 100%.

The Money Market Fund uses the amortized cost method to value its portfolio
securities and seek to maintain a constant net asset value of $1.00 per share,
although there may be circumstances under which this goal cannot be achieved.
The amortized cost method involves valuing a security at its cost and amortizing
any discount or premium over the period until maturity, regardless of the impact
of fluctuating interest rates on the market value of the security. See the SAI
for a more complete description of the amortized cost method.

PURCHASE OF FUND SHARES

Orders for the purchase of shares will be executed at the net asset value
per share next determined after an order has been received.

The following purchase procedures do not apply to certain fund or trust
accounts that are managed by INTRUST. The customer should consult his or her
trust administrator for proper instructions.

All funds received are invested in full and fractional shares of the
appropriate Fund. Certificates for shares are not issued. The Administrator
maintains records of each shareholder's holdings of Fund shares, and each
shareholder receives a statement of transactions, holdings and dividends. The
Funds reserve the right to reject any purchase. The Funds do not accept
third-party checks or foreign checks.

An investment may be made using any of the following methods:

Through an Authorized Broker, Investment Adviser or Service
Organization. Shares are available to new and existing shareholders through
authorized brokers, investment advisers and Service Organizations. To make an
investment using this method, simply complete a Purchase Application and contact
your broker, investment adviser or Service Organization with instructions as to
the amount you wish to invest. Your broker will then contact the Distributor to
place the order on your behalf on that day.

Orders received by your broker or Service Organization for the Non-Money
Market Funds in proper order prior to the determination of net asset value and
transmitted to the Distributor prior to the close of its business day

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<PAGE> 48

(which is currently 4:00 p.m., Eastern time), will become effective that day.
Orders for the Money Market Fund received prior to 12:00 noon will become
effective that day. Brokers who receive orders are obligated to transmit them
promptly. You should receive written confirmation of your order within a few
days of receipt of instructions from your broker.

By Mail. Mail completed application and check made payable to the
appropriate fund or to "The INTRUST Funds Trust" to:

INTRUST Funds Trust

P.O. Box 182498

Columbus, OH 43218-2498

By Wire. Investments may be made directly through the use of wire
transfers of Federal funds. Contact your bank and request it to wire Federal
funds to the applicable Fund. In most cases, your bank will either be a member
of the Federal Reserve Banking System or have a relationship with a bank that
is. Your bank may charge a fee for handling the transaction. To purchase shares
by a Federal funds wire, please first contact BISYS at (888) 266-8787.
Application must be overnighted to:

INTRUST Funds Trust

c/o BISYS Fund Services

3435 Stelzer Road

Columbus, OH 43219-8021

Other Purchase Information. Request in "good order" must include the
following documentation: (a) a letter of instruction, if required, signed by all
registered owners of the shares in the names in which they are registered; (b)
any required signatures guaranteed; and (c) other supporting legal documents, if
required, in the case of estates, trusts, guardianships, custodianships,
corporations, pension and profit sharing plans and other organizations.

Institutional Accounts. Bank trust departments and other institutional
accounts, not subject to sales charges, may place orders directly with the
Distributor by telephone at (888) 266-8787.

MINIMUM PURCHASE REQUIREMENTS

The minimum initial investment in the Funds is $1,000 unless the investor
is a purchaser who at the time of purchase, has a balance of $1,000 or more in
any of the IN-TRUST Funds, is a purchaser through a trust investment manager or
account manager or is administered by INTRUST, is an employee or an ex-employee
of INTRUST Financial Corporation or is an employee of any of its affiliates,
BISYS, or any other service provider, or is an employee of any trust customer of
INTRUST Financial Corporation or any of its affiliates. Note that the minimum is
$250 for an IRA, other than an IRA for which INTRUST Financial Corporation or
any of its affiliates acts as trustee or custodian. Any subsequent investments,
including an IRA investment, must be at least $50. All initial investments
should be accompanied by a completed Purchase Application. A Purchase
Application accompanies this Prospectus. Different minimums apply, and a
separate application is required for IRA investments. The Funds reserve the
right to reject purchase orders.

INDIVIDUAL RETIREMENT ACCOUNTS

All Funds may be used as a funding medium for IRAs. Shares may also be pur-

46
<PAGE> 49

chased for IRAs established with INTRUST Financial Corporation or any of its
affiliates or other authorized custodians. Completion of a special application
is required in order to create such an account, and the minimum initial
investment for an IRA is $250. Contributions to IRAs are subject to prevailing
amount limits set by the Internal Revenue Service. For more information
concerning investments by IRAs, call the Funds at (888) 266-8787.

EXCHANGE OF FUND SHARES

The Funds offer two convenient ways to exchange shares in one Fund for
shares in another Fund in the Trust. Before engaging in an exchange transaction,
a shareholder should read carefully the Prospectus describing the Fund into
which the exchange will occur, which is available without charge and can be
obtained by writing to the Fund at 3435 Stelzer Road, Columbus, Ohio 43219, or
by calling (888) 266-8787. The minimum amount for an initial exchange is $500.
No minimum is required in subsequent exchanges. The Trust may terminate or amend
the terms of the exchange privilege at any time.

A new account opened by exchange must be established with the same name(s),
address and social security number as the existing account. All exchanges will
be made based on the net asset value next determined following receipt of the
request by a Fund in good order, plus any applicable sales charge. An exchange
is taxable as a sale of a security on which a gain or loss may be recognized.
Shareholders should receive written confirmation of the exchange within a few
days of the completion of the transaction. Shareholders will receive at least 60
days prior written notice of any modification or termination of the exchange
privilege.

Exchange by Mail. To exchange Fund shares by mail, simply send a letter of
instruction to the Administrator. The letter of instruction must include: (i)
your account number; (ii) the Fund from and the Fund into which you wish to
exchange your investment; (iii) the dollar or share amount you wish to exchange;
and (iv) the signatures of all registered owners or authorized parties.

Exchange by Telephone. To exchange Fund shares by telephone or if you have
any questions simply call the Funds at (888) 266-8787. You should be prepared to
give the telephone representative the following information: (i) your account
number, social security or tax identification number and account registration;
(ii) the name of the Fund from and the Fund into which you wish to transfer your
investment; and (iii) the dollar or share amount you wish to exchange. The
conversation may be recorded to protect you and the Funds. Telephone exchanges
are available only if the shareholder so indicates by checking the "yes" box on
the Purchase Application. See "Redemption of Fund Shares -- By Telephone" for a
discussion of telephone transactions generally. This option will be suspended
for a period of 10 days following a telephonic address change.

Automatic Investment Program. An eligible shareholder may also participate
in the Automatic Investment Program, an investment plan that automatically
debits money from the shareholder's bank account and invests it in one or more
of the Funds in the Trust through the use of electronic funds transfers or
automatic bank drafts. Shareholders may elect to make subsequent investments by
transfers of a minimum of $50 on either the fifth or twentieth day of each month
into their established Fund account. Contact the Funds for more

47
<PAGE> 50

information about the Automatic Investment Program.

REDEMPTION OF FUND SHARES

Shareholders may redeem their shares, in whole or in part, on any Business
Day. Shares will be redeemed at the net asset value next determined after a
redemption request in good order has been received by the applicable Fund. See
"Determination of Net Asset Value" in the SAI. A redemption may be a taxable
transaction on which gain or loss may be recognized. Generally, however, gain or
loss is not expected to be realized on a redemption of shares of the Money
Market Fund which seeks to maintain a net asset value of $1.00 per share.

Redemption of shares purchased by check will be effected immediately upon
clearance of the purchase check which may take up to 15 days after those shares
have been credited to the shareholder account. Shareholders may avoid this delay
by investing through wire transfers of Federal funds. During the period prior to
the time the shares are redeemed, dividends on the shares will continue to
accrue and be payable and the shareholder will be entitled to exercise all other
beneficial rights of ownership.

Once the shares are redeemed, a Fund will ordinarily send the proceeds by
check to the shareholder at the address of record on the next business day. The
Funds may, however, take up to seven days to make payment. This will not be the
customary practice. Also, if the New York Stock Exchange is closed (or when
trading is restricted) for any reason other than the customary weekend or
holiday closing or if an emergency condition as determined by the SEC merits
such action, the Funds may suspend redemptions or postpone payment dates.

Redemption Methods. To ensure acceptance of your redemption request, it is
important to follow the procedures described below. Although the Funds have no
present intention to do so, the Funds reserve the right to refuse or to limit
the frequency of any telephone or wire redemptions. Of course, it may be
difficult to place orders by telephone during periods of severe market or
economic change, and a shareholder should consider alternative methods of
communications, such as couriers. The Funds' services and their provisions may
be modified or terminated at any time by the Funds. If the Funds terminate any
particular service, they will do so only after giving written notice to
shareholders. Redemption by mail will always be available to shareholders.

You may redeem your shares using any of the following methods:

Through an Authorized Broker, Investment Adviser or Service
Organization. You may redeem your shares by contacting your broker, investment
adviser or Service Organization representative, and instructing him or her to
redeem your shares. He or she will then contact the Distributor and place a
redemption trade on your behalf. You may be charged a fee for this service.

By Mail. You may redeem your shares by sending a letter directly to the
Distributor. To be accepted, a letter requesting redemption must include: (i)
the Fund name and account registration from which you are redeeming shares; (ii)
your account number; (iii) the amount to be redeemed; (iv) the signatures of all
registered owners; and (v) a signature guarantee by any eligible guarantor
institution including a member of a national securities exchange or a commercial
bank or trust company, broker-dealers, credit unions and savings associations.
Corporations, partnerships, trusts

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<PAGE> 51

or other legal entities will be required to submit additional documentation
(only required if proceeds are to be sent to an address other than the
registered address on record).

By Telephone. You may redeem your shares by calling the Funds toll free at
(888) 266-8787. You should be prepared to give the telephone representative the
following information: (i) your account number, social security number and
account registration; (ii) the Fund name from which you are redeeming shares;
and (iii) the amount to be redeemed. The conversation may be recorded to protect
you and the Funds. Telephone redemptions are available only if the shareholder
so indicates by checking the "yes" box on the Purchase Application or on the
Optional Services Form. The Funds employ reasonable procedures to confirm that
instructions communicated by telephone are genuine. If the Funds fail to employ
such reasonable procedures, they may be liable for any loss, damage or expense
arising out of any telephone transactions purporting to be on a shareholder's
behalf. In order to assure the accuracy of instructions received by telephone,
the Funds require some form of personal identification prior to acting upon
instructions received by telephone, record telephone instructions and provide
written confirmation to investors of such transactions. Redemption requests
transmitted via facsimile will not be accepted. This option will be suspended
for a period of 10 days following a telephonic address change.

By Wire. You may redeem your shares by contacting the Funds by mail or
telephone and instructing them to send a wire transmission to your personal
bank. Proceeds of wire redemption for the Money Market Fund generally will be
transferred to the designated account on the day the request is received,
provided that it is received by 12:00 noon (Eastern time).

Your instructions should include: (i) your account number, social security
or tax identification number and account registration; (ii) the Fund name from
which you are redeeming shares; and (iii) the amount to be redeemed. Wire
redemptions can be made only if the "yes" box has been checked on your Purchase
Application, and attach a copy of a void check of account where proceeds are to
be wired. Your bank may charge you a fee for receiving a wire payment on your
behalf.

Check Writing. A check redemption ($500 minimum, no maximum) feature is
available with respect to the Money Market Fund. Checks are free and may be
obtained from the Funds. It is not possible to use a check to close out your
account since additional shares accrue daily.

The above-mentioned services "By Telephone," "By Wire" and "Check Writing"
are not available for IRAs and trust relationships of the Adviser and its
affiliates.

Systematic Withdrawal Plan. An owner of $10,000 or more of shares of a
Fund may elect to have periodic redemptions from his or her account to be paid
on a monthly, quarterly, semi-annual or annual basis. The minimum periodic
payment is $100. A sufficient number of shares to make the scheduled redemption
will normally be redeemed on the date selected by the shareholder. Depending on
the size of the payment requested and fluctuation in the net asset value, if
any, of the shares redeemed, redemptions for the purpose of making such payments
may reduce or even exhaust the account. A shareholder may request that these
payments be sent to a predesignated bank or other designated party. Capital
gains and dividend distributions paid to the account will

49
<PAGE> 52

automatically be reinvested at net asset value on the distribution payment date.

Redemption of Small Accounts. Due to the disproportionately higher cost of
servicing small accounts, each Fund reserves the right to redeem, on not less
than 30 days' notice, an account in a Fund that has been reduced by a
shareholder to $500 or less. However, if during the 30-day notice period the
shareholder purchases sufficient shares to bring the value of the account above
$500, this restriction will not apply.

Redemption in Kind. All redemptions of shares of the Funds shall be made
in cash, except that the commitment to redeem shares in cash extends only to
redemption requests made by each shareholder of a Fund during any 90-day period
of up to the lesser of $250,000 or 1% of the net asset value of that Fund at the
beginning of such period. This commitment is irrevocable without the prior
approval of the SEC and is a fundamental policy of the Funds that may not be
changed without shareholder approval. In the case of redemption requests by
shareholders in excess of such amounts, the Board of Trustees reserves the right
to have the Funds make payment, in whole or in part, in securities or other
assets, in case of an emergency or any time a cash distribution would impair the
liquidity of a Fund to the detriment of the existing shareholders. In this
event, the securities would be valued in the same manner as the securities of
that Fund are valued. If the recipient were to sell such securities, he or she
could receive less than the redemption value of the securities and could incur
certain transaction costs.

DIVIDENDS, DISTRIBUTIONS AND
FEDERAL INCOME TAX

Each Fund intends to qualify annually and to elect to be treated as a
regulated investment company pursuant to the provisions of Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"). By so qualifying and
electing, each Fund generally will not be subject to Federal income tax to the
extent that it distributes investment company taxable income and net capital
gains in the manner required under the Code.

Each Fund intends to distribute to its shareholders substantially all of
its investment company taxable income (which includes, among other items,
dividends and interest and the excess, if any, of net short-term capital gains
(generally including any net option premium income) over net long-term capital
losses). The International Multi-Manager Stock Fund's net investment income
consists of its share of the Portfolio's dividends and interest (including
discount) accrued on its securities, less applicable expenses. The Money Market
Fund, the Intermediate Bond Fund, and the Short-Term Bond Fund will declare
distributions of such income daily and pay those dividends monthly; the Stock
Fund and International Multi-Manager Stock Fund will pay dividends at least once
annually. Each Fund intends to distribute, at least annually, substantially all
net capital gains (the excess of net long-term capital gains over net short-term
capital losses). In determining amounts of capital gains to be distributed, any
capital loss carryovers from prior years will be applied against capital gains.

Distributions will be paid in additional Fund shares based on the net asset
value at the close of business on the payment date of the distribution, unless
the shareholder elects in

50
<PAGE> 53

writing, not less than five full business days prior to the record date, to
receive such distributions in cash. Dividends declared in, and attributable to,
the preceding month will be paid within five business days after the end of each
month.

In the case of the Money Market Fund, shares purchased will begin earning
dividends on the day the purchase order is executed and shares redeemed will
earn dividends through the previous day. Net investment income for a Saturday,
Sunday or a holiday will be declared as a dividend on the previous business day.
In the case of the other Funds that declare daily dividends, shares purchased
will begin earning dividends on the day after the purchase order is executed,
and shares redeemed will earn dividends through the day the redemption is
executed.

Investors who redeem all or a portion of Fund shares prior to a dividend
payment date will be entitled on the next dividend payment date to all dividends
declared but unpaid on those shares at the time of their redemption.

If you elect to receive distribution in cash and checks (1) are returned
and marked as "undeliverable" or (2) remain uncashed for six months, your cash
election will be changed automatically and your future dividend and capital
gains distributions will be reinvested in the Fund at the per share net asset
value determined as of the date of payment of the distribution. In addition, any
undeliverable checks or checks that remain uncashed for six months will be
canceled and will be reinvested in the Fund at the per share net asset value
determined as of the date of cancellation.

Distributions of investment company taxable income (regardless of whether
derived from dividends, interest or short-term capital gains) will generally be
taxable to shareholders as ordinary income. Distributions of net long-term
capital gains properly designated by a Fund as capital gain dividends will be
taxable as long-term capital gains, regardless of how long a shareholder has
held his Fund shares. Distributions are taxable in the same manner whether
received in additional shares or in cash.

Earnings of the Funds not distributed on a timely basis in accordance with
a calendar year distribution requirement are subject to a nondeductible 4%
excise tax. To prevent imposition of this tax, each Fund intends to comply with
this distribution requirement.

A distribution, including an "exempt-interest dividend," will be treated as
paid on December 31 of the calendar year if it is declared by a Fund during
October, November, or December of that year to shareholders of record in such a
month and paid by a Fund during January of the following calendar year. Such
distributions will be treated as received by shareholders in the calendar year
in which the distributions are declared, rather than the calendar year in which
the distributions are received.

A Fund's distributions with respect to a given taxable year may exceed the
current and accumulated earnings and profits of that Fund available for
distribution. In that event, distributions in excess of such earnings and
profits would be characterized as a return of capital to shareholders for
Federal income tax purposes, thus reducing each shareholder's cost basis in his
Fund shares. Such distributions in excess of a shareholder's cost basis in his
shares would be treated as a gain realized from a sale of such shares.

Special tax rules may apply to a Fund's acquisition of financial futures
contracts, and options on futures contracts. Such rules may,

51
<PAGE> 54

among other things, affect whether gains and losses from such transactions are
considered to be short-term or long-term, may have the effect of deferring
losses and/or accelerating the recognition of gains or losses, and, for purposes
of qualifying as a regulated investment company, may limit the extent to which a
Fund may be able to engage in such transactions.

Any gain or loss realized by a shareholder upon the sale or other
disposition of shares of a Fund, or upon receipt of a distribution in complete
liquidation of a Fund, generally will be a capital gain or loss which will be
long-term or short-term, generally depending upon the shareholder's holding
period for the shares. A loss realized by a shareholder on a redemption, sale,
or exchange of shares of a Fund held six months or less with respect to which
capital gain dividends have been paid will be characterized as a long-term
capital loss to the extent of such capital gain dividends.

It is anticipated that a portion of the dividends paid by the Funds (except
the Money Market Fund, Short-Term Bond Fund, the International Multi-Manager
Stock Fund, and Intermediate Bond Fund) will qualify and be designated by such
Funds as dividends eligible for the dividends-received deduction available to
corporations. The Code imposes various limitations restricting the availability
of the dividends-received deduction. Pending law proposals may affect the
dividends-received deduction. Investors should consult their own tax advisers in
this regard.

The Funds may be required to withhold for Federal income tax ("backup
withholding") 31% of the distributions and the proceeds of redemptions payable
to shareholders who fail to provide a correct taxpayer identification number or
to make required certifications, or where a Fund or shareholder has been
notified by the Internal Revenue Service that the shareholder is subject to
backup withholding. Most corporate shareholders and certain other shareholders
specified in the Code and regulations are exempt from backup withholding. Backup
withholding is not an additional tax. Any amounts withheld may be credited
against the shareholder's U.S. Federal income tax liability.

Those Funds that may invest in securities of foreign issuers may be subject
to withholding and other similar income taxes imposed by a foreign country. Each
of these Funds intends to elect, if it is eligible to do so under the Code, to
"pass-through" to its shareholders the amount of such foreign taxes paid. If
such an election is made by a Fund, each shareholder of that Fund would be
required to include in gross income the taxable dividends received and the
amount of pro rata share of those foreign taxes paid by the Fund. Each
shareholder would be entitled either to deduct (as an itemized deduction) his
pro rata share of the foreign taxes in computing his taxable income or to use it
(subject to limitations) as a foreign tax credit against his U.S. Federal income
tax liability. No deduction for foreign taxes may be claimed by a shareholder
who does not itemize deductions. Each shareholder will be notified within 60
days after the close of a Fund's taxable year whether the foreign taxes paid by
the Fund will "pass-through" for that year.

Shareholders will be notified annually by the Trust as to the Federal tax
status of distributions made by the Fund(s) in which they invest. Depending on
the residence of the shareholder for tax purposes, distributions also may be
subject to state and local taxes, including withholding taxes. Foreign
shareholders may, for example, be subject to special withholding requirements.
Special tax treatment,

52
<PAGE> 55

including a penalty on certain pre-retirement distributions, is accorded to
accounts maintained as IRAs. Shareholders should consult their own tax advisers
as to the Federal, state and local tax consequences of ownership of shares of
the Funds in their particular circumstances.

The Portfolio in which the International Multi-Manager Stock Fund invests
is not required to pay Federal income taxes on its net investment income and
capital gain, as it is treated as a partnership for Federal income tax purposes.
All interest, dividends and gains and losses of the Portfolio are deemed to have
been "passed through" to the International Multi-Manager Stock Fund in
proportion to its holdings of the Portfolio, regardless of whether such
interest, dividends or gains have been distributed by the Portfolio or losses
have been realized by the Portfolio. Investment income received by the
International Multi-Manager Stock Fund from sources within foreign countries may
be subject to foreign income or other taxes. The International Multi-Manager
Stock Fund intends to elect, if eligible to do so, to permit its shareholders to
take a credit (or a deduction) for foreign income and other taxes paid by the
Portfolio. Shareholders of the International Multi-Manager Stock Fund will be
notified of their share of those taxes and will be required to include that
amount as income. In that event, the shareholder may be entitled to claim a
credit or deduction for those taxes.

OTHER INFORMATION

CAPITALIZATION STRUCTURE

INTRUST Funds Trust was organized as a Delaware business trust on January
26, 1996, and currently consists of six separately managed portfolios. The Board
of Trustees may establish additional portfolios in the future. The
capitalization of the Trust consists solely of an unlimited number of shares of
beneficial interest with a par value of $0.001 each. When issued, shares of the
Funds are fully paid, non-assessable and freely transferable.

Each Fund offers two class of shares -- the Institutional Service Class and
the Institutional Premium Class. The Funds are offered at net asset value
without a sales load only to certain institutional investors, or other investors
who at the time of purchase have a balance of $1,000 or more invested in any of
the INTRUST Funds, are purchased through a trust investment manager or account
manager or administered by INTRUST, are employees or ex-employees of INTRUST
Financial Corporation or any of its affiliates, employees of BISYS, or any other
service provider, or employees of any trust customer of INTRUST Financial
Corporation or any of its affiliates. Shareholders in the Institutional Premium
Class of shares may be subject to an additional shareholder servicing charge of
up to 0.50% of average net assets. Call (888) 266-8787 or contact your sales
representative, broker-dealer or bank to obtain more information about the
Funds' classes of shares.

Under Delaware law, shareholders could, under certain circumstances, be
held personally liable for the obligations of the Trust. However, the
Declaration of Trust disclaims liability of the shareholders, Trustees or
officers of the Trust for acts or obligations of the Trust, which are binding
only on the assets and property of the Trust and requires that notice of the
disclaimer be given in each contract or obligation entered into or executed by
the Trust or the Trustees. The Declaration of Trust provides for indemnification
out of Trust property for all loss and expense of any shareholder held
personally liable for the obligations of the Trust. The risk of a shareholder
incurring fi

53
<PAGE> 56

nancial loss on account of shareholder liability is limited to circumstances in
which the Trust itself would be unable to meet its obligations and should be
considered remote.

INTERNATIONAL MULTI-MANAGER STOCK FUND STRUCTURE

The International Multi-Manager Stock Fund invests all of its investable
assets in the Portfolio, a separate series of the AMR Trust, a business trust
organized under the laws of the State of New York in October 1995. AMR Trust is
registered under the 1940 Act as an open-end management investment company and
currently has seven separate portfolios. The assets of the Portfolio, a
diversified portfolio, belong only to, and the liabilities of the Portfolio are
borne solely by, the Portfolio and no other portfolio of AMR Trust.

The International Multi-Manager Stock Fund seeks to achieve its investment
objective by investing all of its investable assets in the Portfolio, which has
the same investment objective and policies as the International Multi-Manager
Stock Fund. Accordingly, the Portfolio directly acquires its own securities and
the International Multi-Manager Stock Fund acquires an indirect interest in
those securities. The investment objective and fundamental investment policies
of the International Multi-Manager Stock Fund and the Portfolio can be changed
only with shareholder approval. See "Highlights," "Investment Policies and
Practices of the Funds," and "Management of the Funds" for a complete
description of the Portfolio's investment objective, policies, restrictions,
management, and expenses.

The International Multi-Manager Stock Fund's investment in the Portfolio is
in the form of a non-transferable beneficial interest. As of the date of this
Prospectus, the International Multi-Manager Stock Fund, the American AAdvantage
International Equity Fund and the American AAdvantage International Equity
Mileage Fund are the only institutional investors that have invested all of
their assets in the Portfolio. The Portfolio may permit other investment
companies or institutional investors to invest in it. All investors in the
Portfolio will invest on the same terms and conditions as the International
Multi-Manager Stock Fund and will pay a proportionate share of the Portfolio's
expenses.

The Portfolio normally will not hold meetings of investors except as
required by the 1940 Act. Each investor in the Portfolio will be entitled to
vote in proportion to its relative beneficial interest in the Portfolio. On most
issues subject to a vote of investors, as required by the 1940 Act and other
applicable law, the International Multi-Manager Stock Fund will solicit proxies
from shareholders of the International Multi-Manager Stock Fund and will vote
its interest in the Portfolio in proportion to the votes cast by its
shareholders. If there are other investors in the Portfolio, there can be no
assurance that any issue that receives a majority of the votes cast by
International Multi-Manager Stock Fund shareholders will receive a majority of
votes cast by all investors in the Portfolio; indeed, if other investors hold a
majority interest in the Portfolio, they could hold have voting control of the
Portfolio.

The Portfolio will not sell its shares directly to members of the general
public. Another investor in the Portfolio, such as an investment company, that
might sell its shares to members of the general public would not be required to
sell its shares at the same public offering price as the International
Multi-Manager Stock Fund, could have different advisory and other fees and
expenses than the International Multi-Manager Stock Fund. Therefore,

54
<PAGE> 57

International Multi-Manager Stock Fund shareholders may have different returns
than shareholders in another investment company that invests exclusively in the
Portfolio. Call (800) 967-9009 or contact your sales representative to obtain
more information concerning other funds that invest in the Portfolio.

VOTING

Shareholders have the right to vote in the election of Trustees and on any
and all matters on which, by law or under the provisions of the Declaration of
Trust, they may be entitled to vote. The Trust is not required to hold regular
annual meetings of the Funds' shareholders and does not intend to do so. The
Trustees are required to call a meeting for the purpose of considering the
removal of a person serving as Trustee if requested in writing to do so by the
holders of not less than 10% of the outstanding shares of the Trust and in
connection with such meeting to comply with the shareholders' communications
provisions of Section 16(c) of the Act. See "Other Information -- Voting Rights"
in the SAI.

Shares entitle their holders to one vote per share (with proportionate
voting for fractional shares). As used in this Prospectus, the phrase "vote of a
majority of the outstanding shares" of a Fund (or the Trust) means the vote of
the lesser of: (1) 67% of the shares of a Fund (or the Trust) present at a
meeting if the holders of more than 50% of the outstanding shares are present in
person or by proxy; or (2) more than 50% of the outstanding shares of a Fund (or
the Trust).

PERFORMANCE INFORMATION

A Fund may, from time to time, include its yield and total return in
advertisements or reports to shareholders or prospective investors. Shareholders
of the Institutional Premium Class of shares will experience a lower net return
on their investment than shareholders of the Institutional Service Class of
Shares because of the additional shareholder servicing charge to which the
Institutional Premium Class shareholders are subject. The methods used to
calculate the yield and total return of the Funds are mandated by the SEC.
Quotations of "yield" for a Fund (other than the Money Market Fund) will be
based on the investment income per share during a particular 30-day (or one
month) period (including dividends and interest), less expenses accrued during
the period ("net investment income"), and will be computed by dividing net
investment income by the maximum public offering price per share on the last day
of the period.

Quotations of "yield" for the Money Market Fund will be based on the income
received by a hypothetical investment (less a pro-rata share of Fund expenses)
over a particular seven-day period, which is then "annualized" (i.e., assuming
that the seven-day yield would be received for 52 weeks, stated in terms of an
annual percentage return on the investment).

"Effective yield" for the Money Market Fund is calculated in a manner
similar to that used to calculate yield, but includes the compounding effect of
earnings on reinvested dividends.

Quotations of yield and effective yield reflect only a Fund's performance
during the particular period on which the calculations are based. Yield and
effective yield for a Fund will vary based on changes in market conditions, the
level of interest rates and the level of that Fund's expenses, and no reported
performance figure should be considered an indication of performance which may
be expected in the future.

55
<PAGE> 58

Quotations of average annual total return for a Fund (other than the Money
Market Fund) will be expressed in terms of the average annual compounded rate of
return of a hypothetical investment in that Fund over periods of 1, 5 and 10
years (up to the life of that Fund), reflect the deduction of a proportional
share of Fund expenses (on an annual basis), and assume that all dividends and
distributions are reinvested when paid.

Performance information for a Fund may be compared to various unmanaged
indices, such as those indices prepared by Lipper Analytical Services, Standard
& Poor's 500 Stock Index, the Dow Jones Industrial Average and other entities or
organizations which track the performance of investment companies. Any
performance information should be considered in light of the Fund's investment
objectives and policies, characteristics and quality of the Funds and the market
conditions during the time period indicated, and should not be considered to be
representative of what may be achieved in the future. For a description of the
methods used to determine yield and total return for the Funds, see the SAI.

The International Multi-Manager Stock Fund invests all of its investable
assets in the Portfolio. The Portfolio's predecessor fund, the American
AAdvantage International Equity Fund, a series of the American AAdvantage Funds,
has been in existence since August 7, 1991. On November 1, 1995, the American
AAdvantage Funds reorganized into a Hub and Spoke(R) structure. As part of the
reorganization, the AMR Trust was created to serve as the "Hub" trust and the
American AAdvantage Funds served as one of the initial "Spoke" trusts.
Performance shown is based in part on the American AAdvantage International
Equity Fund, which also invests in the Portfolio. Performance shown represents
average annualized total return, consisting of returns of the Institutional
Class of the American AAdvantage International Equity Fund from its August 7,
1991 inception until November 1, 1995, and then return based on the Portfolio,
in each case reflecting actual fees. INTRUST Fund fees are higher than the
expenses used in calculating this performance information. Such performance
would have been lower, taking into account current INTRUST Fund fees.

<TABLE>
<CAPTION>
ANNUALIZED RATES
OF RETURN
FOR PERIODS ENDING
SEPTEMBER 30, 1996
------------------------
LIPPER
INTERNATIONAL
FUND INDEX
------- -------------
<S> <C> <C>
1 Year:.............................................................. 14.49% 10.74%
3 Years:............................................................. 14.15% 9.62%
5 Years:............................................................. 11.03% 9.91%
Since Inception (8/7/91):............................................ 11.01% 10.15%
</TABLE>

Past performance is not indicative of future performance.

ACCOUNT SERVICES

All transactions in shares of the Funds will be reflected in a statement
for each shareholder. In those cases where a Service Organi-

56
<PAGE> 59

zation or its nominee is shareholder of record of shares purchased for its
customer, the Funds have been advised that the statement may be transmitted to
the customer at the discretion of the Service Organization.

BISYS acts as the Funds' transfer agent. The Trust compensates BISYS, the
Trust's administrator, pursuant to a Services Agreement described in "Management
of the Fund -- Administrative Services" of this Prospectus, for providing
personnel and facilities to perform dividend disbursing and transfer
agency-related services for the Trust.

SHAREHOLDER INQUIRIES

All shareholder inquiries should be directed to the Funds at 3435 Stelzer
Road, Columbus, Ohio 43219.

(General and Account Information: (888) 266-8787.

57
<PAGE> 60

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<PAGE> 61

APPENDIX

DESCRIPTION OF MOODY'S BOND RATINGS:

Excerpts from Moody's description of its four highest bond ratings are
listed as follows: Aaa -- judged to be the best quality and they carry the
smallest degree of investment risk; Aa -- judged to be of high quality by all
standards. Together with the Aaa group, they comprise what are generally known
as high grade bonds; A -- possess many favorable investment attributes and are
to be considered as "upper medium grade obligations"; Baa -- considered to be
medium grade obligations, i.e., they are neither highly protected nor poorly
secured. Interest payments and principal security appear adequate for the
present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time. Other Moody's bond
descriptions include: Ba -- judged to have speculative elements, their future
cannot be considered as well assured; B -- generally lack characteristics of the
desirable investment; Caa -- are of poor standing. Such issues may be in default
or there may be present elements of danger with respect to principal or
interest; Ca -- speculative in a high degree, often in default; C -- lowest
rated class of bonds, regarded as having extremely poor prospects.

Moody's also supplies numerical indicators 1, 2 and 3 to rating categories.
The modifier 1 indicates that the security is in the higher end of its rating
category; the modifier 2 indicates a mid-range ranking; and modifier 3 indicates
a ranking toward the lower end of the category.

DESCRIPTION OF S&P'S BOND RATINGS:

Excerpts from S&P's description of its four highest bond ratings are listed
as follows: AAA -- highest grade obligations, in which capacity to pay interest
and repay principal is extremely strong; AA -- also qualify as high grade
obligations, having a very strong capacity to pay interest and repay principal,
and differs from AAA issues only in a small degree; A -- regarded as upper
medium grade, having a strong capacity to pay interest and repay principal,
although they are somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories; BBB
- -- regarded as having an adequate capacity to pay interest and repay principal.
Whereas it normally exhibits adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to lead to a weakened
capacity to pay interest and repay principal for debt in this category than in
higher rated categories.

BB, B, CCC, CC: Debt rated in these categories is regarded as having
predominantly speculative characteristics with respect to capacity to pay
interest and repay principal. While such debt will likely have some quality and
protective characteristics, these are outweighed by large uncertainties or major
risk exposures to adverse conditions.

CI: The "CI" rating is reserved for income bonds on which no interest is
being paid.

S&P applies indicators "+, -," no character, and relative standing within
the major rating categories.

DESCRIPTION OF MOODY'S RATINGS OF NOTES AND VARIABLE RATE DEMAND INSTRUMENTS:

Moody's ratings for state and municipal short-term obligations will be
designated Moody's Investment Grade or MIG. Such ratings recognize the
differences between short-term credit and long-term risk. Short-term ratings on
issues with demand features (varia-

A-1
<PAGE> 62

ble rate demand obligations) are differentiated by the use of the VMIG symbol to
reflect such characteristics as payment upon periodic demand rather than fixed
maturity dates and payments relying on external liquidity.

MIG 1/VMIG 1: This designation denotes best quality. There is present strong
protection by established cash flows, superior liquidity support or demonstrated
broad-based access to the market for refinancing.

MIG 2/VMIG 2: This denotes high quality. Margins of protection are ample
although not as large as in the preceding group.

A-2
<PAGE> 63

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<PAGE> 64

Address for

Trust Clients of INTRUST Bank, N.A.
105 North Main Street
Box One

Wichita, Kansas 67202

Investment Adviser

INTRUST Bank, N.A.
105 North Main Street
Box One

Wichita, Kansas 67202

Subadvisers

AMR Investment Services, Inc.
4333 Amon Carter Blvd. MD5645
Fort Worth, Texas 76155
(Money Market Fund only)

ARK Asset Management, Inc.
One New York Plaza
New York, NY 10004
(Stock Fund only)

Galliard Capital Management, Inc.
800 La Salle Avenue
Suite 2060
Minneapolis, MN 55479-2052
(Short-Term Bond Fund and
Intermediate Bond Fund only)

Investment Adviser

AMR Investment Services, Inc.

4333 Amon Carter Blvd. MD5645

Fort Worth, Texas 76155

(International Multi-Manager Stock
Fund only)

Administrator and Sponsor and
Distributor

BISYS Funds Services
3435 Stelzer Road
Columbus, Ohio 43219

Custodian

INTRUST Bank, N.A.
105 North Main Street
Box One

Wichita, Kansas 67202

Counsel

Baker & McKenzie
805 Third Avenue
New York, New York 10022

Independent Accountants

KPMG Peat Marwick LLP
Two Nationwide Plaza
Columbus, Ohio 43215
INTRUST FUNDS TRUST

A FAMILY OF
MUTUAL FUNDS

MONEY MARKET FUND

SHORT-TERM BOND FUND

INTERMEDIATE BOND FUND

STOCK FUND

INTERNATIONAL MULTI-MANAGER
STOCK FUND

PROSPECTUS

January 8, 1997

LOGO

INVESTMENT ADVISER

INTRUST BANK, N.A.
<PAGE> 65
INTRUST FUNDS TRUST
3435 Stelzer Road, Columbus, Ohio 43219
General and Account Information: (888) 266-8787
- --------------------------------------------------------------------------------

INTRUST BANK, N.A.--Investment Adviser
("INTRUST" or the "Adviser")

BISYS FUND SERVICES
Administrator, Sponsor and Distributor
("BISYS" or the "Administrator" or the "Distributor")

STATEMENT OF ADDITIONAL INFORMATION

This Statement of Additional Information (the "SAI") describes
one money market fund (the "Money Market Fund") and five non-money market funds
(the "Non-Money Market Funds") (collectively, the "Funds"), all of which are
managed by INTRUST Bank, N.A. The Funds are:

MONEY MARKET FUND

- Money Market Fund

NON MONEY MARKET FUNDS

- Short-Term Bond Fund
- Intermediate Bond Fund
- Stock Fund
- Kansas Tax-Exempt Bond Fund
- International Multi-Manager Stock Fund

Each Fund constitutes a separate investment portfolio with
distinct investment objectives and policies. Shares of the Funds are sold to
the public by BISYS as an investment vehicle for individuals, institutions,
corporations and fiduciaries, including customers of INTRUST or its affiliates.

The International Multi-Manager Stock Fund seeks its
investment objective by investing all of its investable assets in the
International Equity Portfolio ("Portfolio") of the AMR Investment Services
Trust ("AMR Trust") that has an identical investment objective to the
International Multi-Manager Stock Fund.

This SAI is not a prospectus and is only authorized for
distribution when preceded or accompanied by a prospectus for the applicable
Fund dated January 8, 1997 (the "Prospectus"). This SAI contains additional
and more detailed information than that set forth in each Prospectus and should
be read in conjunction with the applicable Prospectus. The Prospectuses may be
obtained without charge by writing or calling the Funds at the address and
information number printed above.

January 8, 1997

<PAGE> 66
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
INVESTMENT POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

INVESTMENT RESTRICTIONS . . . . . . . . . . . . . . . . . . . . . . . . . 16

KANSAS RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Trustees and Officers . . . . . . . . . . . . . . . . . . . . . 29
Trustees and Officers of AMR Investment
Services Trust . . . . . . . . . . . . . . . . . . . . . . . . . 31
Investment Advisers . . . . . . . . . . . . . . . . . . . . . . 35
The Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . 36
Distribution of Fund Shares . . . . . . . . . . . . . . . . . . 39
Distribution Plan . . . . . . . . . . . . . . . . . . . . . . . 40
Administrative Services . . . . . . . . . . . . . . . . . . . . 41
Service Organizations . . . . . . . . . . . . . . . . . . . . . 41

EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

DETERMINATION OF NET ASSET VALUE . . . . . . . . . . . . . . . . . . . . 43

PORTFOLIO TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . 45
Portfolio Turnover . . . . . . . . . . . . . . . . . . . . . . . 47

TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Taxation of the Portfolio . . . . . . . . . . . . . . . . . . . 48
Kansas Tax-Exempt Bond Fund. . . . . . . . . . . . . . . . . . . 55

OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . 58
Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . 59
Custodian Transfer Agent and Dividend
Disbursing Agent . . . . . . . . . . . . . . . . . . . . . . . . 60
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Yield and Performance Information . . . . . . . . . . . . . . . 60
Financial Statements . . . . . . . . . . . . . . . . . . . . . . 62
</TABLE>

-i-
<PAGE> 67
INVESTMENT POLICIES

The Prospectuses discuss the investment objectives of the
Funds and the policies to be employed to achieve those objectives. This
section contains supplemental information concerning certain types of
securities and other instruments in which the Funds may invest, the investment
policies and portfolio strategies that the Funds may utilize, and certain risks
attendant to such investments, policies and strategies.

As a matter of fundamental policy, notwithstanding any
limitation otherwise noted, each Fund is authorized to seek to achieve its
investment objective by investing all of its investable assets in an investment
company having substantially the same investment objective as the Fund.
References below to "All Funds" include the International Equity Portfolio of
the AMR Investment Services Trust (the "AMR Trust") (the "Portfolio") except
where noted otherwise.

U.S. Government Agency Obligations (All Funds). These Funds
may invest in obligations of agencies of the United States Government. Such
agencies include, among others, Farmers Home Administration, Federal Farm
Credit System, Federal Housing Administration, Government National Mortgage
Association, Maritime Administration, Small Business Administration, and The
Tennessee Valley Authority. The Funds may purchase securities issued or
guaranteed by the Government National Mortgage Association which represent
participations in Veterans Administration and Federal Housing Administration
backed mortgage pools. Obligations of instrumentalities of the United States
Government include securities issued by, among others, Federal Home Loan Banks,
Federal Home Loan Mortgage Corporation, Federal Land Banks, Federal National
Mortgage Association and the United States Postal Service. Some of these
securities are supported by the full faith and credit of the United States
Treasury (e.g., Government National Mortgage Association). Guarantees of
principal by agencies or instrumentalities of the U.S. Government may be a
guarantee of payment at the maturity of the obligation so that in the event of
a default prior to maturity there might not be a market and thus no means of
realizing the value of the obligation prior to maturity.

Mortgage-Related Securities. (All Funds). These Funds may,
consistent with their respective investment objective and policies, invest in
mortgage-related securities issued or
<PAGE> 68
guaranteed by the U.S. Government or its agencies or instrumentalities.

Mortgage-related securities, for purposes of the Fund's
Prospectus and this SAI, represent pools of mortgage loans assembled for sale
to investors by various governmental agencies such as the Government National
Mortgage Association and government-related organizations such as the Federal
National Mortgage Association and the Federal Home Loan Mortgage Corporation,
as well as by nongovernmental issuers such as commercial banks, savings and
loan institutions, mortgage bankers, and private mortgage insurance companies.
Although certain mortgage-related securities are guaranteed by a third party or
otherwise similarly secured, the market value of the security, which may
fluctuate, is not so secured. If the Fund purchases a mortgage-related
security at a premium, that portion may be lost if there is a decline in the
market value of the security whether resulting from changes in interest rates
or prepayments in the underlying mortgage collateral. As with other
interest-bearing securities, the prices of such securities are inversely
affected by changes in interest rates. However, though the value of a
mortgage-related security may decline when interest rates rise, the converse is
not necessarily true since in periods of declining interest rates the mortgages
underlying the securities are prone to prepayment. For this and other reasons,
a mortgage-related security's stated maturity may be shortened by unscheduled
prepayments on the underlying mortgages and, therefore, it is not possible to
predict accurately the security's return to the Fund. In addition, regular
payments received in respect of mortgage-related securities include both
interest and principal. No assurance can be given as to the return a Fund will
receive when these amounts are reinvested.

There are a number of important differences among the agencies
and instrumentalities of the U.S. Government that issue mortgage-related
securities and among the securities that they issue. Mortgage-related
securities created by the Government National Mortgage Association ("GNMA")
include GNMA Mortgage Pass-Through Certificates (also known as "Ginnie Maes")
which are guaranteed as to the timely payment of principal and interest and
such guarantee is backed by the full faith and credit of the United States.
GNMA is a wholly-owned U.S. Government corporation within the Department of
Housing and Urban

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Development. GNMA certificates also are supported by the authority of GNMA to
borrow funds from the U.S. Government to make payments under its guarantee.
Mortgage-related securities issued by the Federal National Mortgage Association
("FNMA") include FNMA Guaranteed Mortgage Pass-Through Certificates (also known
as "Fannie Maes") which are solely the obligations of the FNMA and are not
backed by or entitled to the full faith and credit of the United States. The
FNMA is a government-sponsored organization owned entirely by private
stock-holders. Fannie Maes are guaranteed as to timely payment of the
principal and interest by FNMA. Mortgage-related securities issued by the
Federal Home Loan Mortgage Corporation ("FHLMC") include FHLMC Mortgage
Participation Certificates (also known as ("Freddie Macs" or "PCs"). The FHLMC
is a corporate instrumentality of the United States, created pursuant to an Act
of Congress, which is owned entirely by Federal Home Loan Banks. Freddie Macs
are not guaranteed by the United States or by any Federal Home Loan Banks and
do not constitute a debt or obligation of the United States or of any Federal
Home Loan Bank. Freddie Macs entitle the holder to timely payment of interest,
which is guaranteed by the FHLMC. The FHLMC currently guarantees timely
payment of interest and either timely payment of principal or eventual payment
of principal, depending upon the date of issue. When the FHLMC does not
guarantee timely payment of principal, FHLMC may remit the amount due on
account of its guarantee of ultimate payment of principal at any time after
default on an underlying mortgage, but in no event later than one year after it
becomes payable.

Commercial Paper (All Funds). Commercial paper includes
short-term unsecured promissory notes, variable rate demand notes and variable
rate master demand notes issued by domestic and foreign bank holding companies,
corporations and financial institutions and similar taxable instruments issued
by government agencies and instrumentalities. All commercial paper purchased
by the Funds is, at the time of investment, rated in one of the top two (top
three with respect to the Short-Term Bond Fund) rating categories of at least
one Nationally Recognized Statistical Rating Organization ("NRSRO") or, if not
rated, are, in the opinion of the Adviser or the Portfolio Advisers, as
applicable, of an investment quality comparable to rated commercial paper in
which the Funds may invest, or, with respect to the Money Market Fund, (i)
rated "P-1" by Moody's Investors Service, Inc. ("Moody's") and "A-1" or better
by

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Standard & Poor's Corporation ("S&P") or in a comparable rating category by any
two NRSROs that have rated the commercial paper or (ii) rated in a comparable
category by only one such organization if it is the only organization that has
rated the commercial paper (and provided the purchase is approved or ratified
by the Fund's Board of Trustees or the AMR Trust's Board of Trustees, as
applicable).

Corporate Debt Securities (All Funds, except Kansas
Tax-Exempt Bond Fund). Fund investments in these securities are limited to
corporate debt securities (corporate bonds, debentures, notes and similar
corporate debt instruments) which meet the rating criteria established for each
Fund.

After purchase by a Fund, a security may cease to be rated or
its rating may be reduced below the minimum required for purchase by the Fund.
Neither event will require a sale of such security by the Fund. However, the
Fund's Adviser or Portfolio Advisers, as applicable, will consider such event in
its determination of whether the Fund should continue to hold the security. To
the extent the ratings given by a NRSRO may change as a result of changes in
such organizations or their rating systems, the Fund will attempt to use
comparable ratings as standards for investments in accordance with the
investment policies contained in the Prospectus and in this SAI.

Foreign Securities (Short-Term Bond Fund, Intermediate Bond
Fund, Stock Fund, and International Multi-Manager Stock Fund). Changes in
foreign exchange rates will affect the value of securities denominated or quoted
in currencies other than the U.S. dollar.

Since the Funds may invest in securities denominated in
currencies other than the U.S. dollar, and since those Funds may temporarily
hold funds in bank deposits or other money market investments denominated in
foreign currencies, a Fund may be affected favorably or unfavorably by exchange
control regulations or changes in the exchange rate between such currencies and
the dollar. Changes in foreign currency exchange rates will influence values
within the Fund from the perspective of U.S. investors. Changes in foreign
currency exchange rates may also affect the value of dividends and interest
earned, gains and losses realized on the sale of securities, and net investment
income and gains, if any, to be distributed to shareholders by the Fund. The
rate of exchange between the U.S. dollar and other

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currencies is determined by the forces of supply and demand in the foreign
exchange markets. These forces are affected by the international balance of
payments and other economic and financial conditions, government intervention,
speculation and other factors.

Those Funds that purchase foreign currency-denominated
securities may enter into foreign currency exchange contracts in order to
protect against uncertainty in the level of future foreign exchange rates. A
forward foreign currency exchange contract involves an obligation to purchase
or sell a specific currency at a future date, which may be any fixed number of
days from the date of the contract agreed upon by the parties, at a price set
at the time of the contract. These contracts are entered into in the interbank
market conducted between currency traders (usually large commercial banks) and
their customers. Forward foreign currency exchange contracts may be bought or
sold to protect a Fund against a possible loss resulting from an adverse change
in the relationship between foreign currencies and the U.S. dollar, or between
foreign currencies. Although such contracts are intended to minimize the risk
of loss due to a decline in the value of the hedged currency, at the same time,
they tend to limit any potential gain which might result should the value of
such currency increase.

Bank Obligations. (All Funds). A description of the bank
obligations which the Funds may purchase is set forth in the Prospectuses.
These obligations include, but are not limited to, domestic, Eurodollar and
Yankeedollar certificates of deposits, time deposits, bankers' acceptances,
commercial paper, bank deposit notes and other promissory notes including
floating or variable rate obligations issued by U.S. or foreign bank holding
companies and their bank subsidiaries, branches and agencies. Certificates of
deposit are issued against funds deposited in an eligible bank (including its
domestic and foreign branches, subsidiaries and agencies), are for a definite
period of time, earn a specified rate of return and are normally negotiable. A
bankers' acceptance is a short-term draft drawn on a commercial bank by a
borrower, usually in connection with a commercial transaction. The borrower is
liable for payment as is the bank, which unconditionally guarantees to pay the
draft at its face amount on the maturity date. Eurodollar obligations are U.S.
Dollar obligations issued outside the United States by domestic

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or foreign entities. Yankeedollar obligations are U.S. dollar obligations
issued inside the United States by foreign entities. Bearer deposit notes are
obligations of a bank, rather than a bank holding company. Similar to
certificates of deposit, deposit notes represent bank level investments and,
therefore, are senior to all holding company corporate debt.

Variable and Floating Rate Demand and Master Demand
Obligations (All Funds). The Funds may, from time to time, buy variable rate
demand obligations issued by corporations, bank holding companies and financial
institutions and similar taxable and tax-exempt instruments issued by
government agencies and instrumentalities. These securities will typically
have a maturity of 397 days or less with respect to the Money Market Fund or
five to twenty years with respect to the Non-Money Market Funds, but carry with
them the right of the holder to put the securities to a remarketing agent or
other entity on short notice, typically seven days or less. The obligation of
the issuer of the put to repurchase the securities may or may not be backed by
a letter of credit or other obligation issued by a financial institution. The
purchase price is ordinarily par plus accrued and unpaid interest.

The Funds may also buy variable rate master demand
obligations. The terms of these obligations permit the investment of
fluctuating amounts by the Funds at varying rates of interest pursuant to
direct arrangements between a Fund, as lender, and the borrower. They permit
weekly, and in some instances, daily, changes in the amounts borrowed. The
Funds have the right to increase the amount under the obligation at any time up
to the full amount provided by the note agreement, or to decrease the amount,
and the borrower may prepay up to the full amount of the obligation without
penalty. The obligations may or may not be backed by bank letters of credit.
Because the obligations are direct lending arrangements between the lender and
the borrower, it is not generally contemplated that they will be traded, and
there is no secondary market for them, although they are redeemable (and thus,
immediately repayable by the borrower) at principal amount, plus accrued
interest, upon demand. The Funds have no limitations on the type of issuer
from whom the obligations will be purchased. The Funds will invest in variable
rate master demand obligations only when such obligations are determined by the
Adviser or Portfolio Advisers,

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<PAGE> 73
as applicable or, pursuant to guidelines established by the Board of Trustees
or the AMR Trust Board, as applicable, to be of comparable quality to rated
issuers or instruments eligible for investment by the Funds.

When-Issued and Delayed-Delivery Securities (All Funds). The
Funds may purchase securities on a when-issued or delayed-delivery basis. For
example, delivery of and payment for these securities can take place a month or
more after the date of the transaction. The securities so purchased are
subject to market fluctuation during this period and no income accrues to the
Fund until settlement takes place. To facilitate such acquisitions, the Funds
will maintain with the custodian a separate account with a segregated portfolio
of securities in an amount at least equal to the value of such commitments. On
the delivery dates for such transactions, each Fund will meet obligations from
maturities or sales of the securities held in the separate account and/or from
cash flow. While the Funds normally enter into these transactions with the
intention of actually receiving or delivering the securities, they may sell
these securities before the settlement date or enter into new commitments to
extend the delivery date into the future, if the Adviser or Portfolio Advisers
consider such action advisable as a matter of investment strategy. Such
securities have the effect of leverage on the Funds and may contribute to
volatility of a Fund's net asset value.

Loans of Portfolio Securities (All Funds). The Funds may
lend their portfolio securities to brokers, dealers and financial institutions,
provided: (1) the loan is secured continuously by collateral consisting of
U.S. Government securities or cash or approved bank letters of credit
maintained on a daily mark-to-market basis in an amount at least equal to the
current market value of the securities loaned; (2) the Funds may at any time
call the loan and obtain the return of the securities loaned within five
business days; (3) the Funds will receive any interest or dividends paid on the
loaned securities; and (4) the aggregate market value of securities loaned will
not at any time exceed 33 1/3% of the total assets of a particular Fund.

The Funds will earn income for lending their securities
because cash collateral pursuant to these loans will be invested in short-term
money market instruments. In connection with

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<PAGE> 74
lending securities, the Funds may pay reasonable finders, administrative and
custodial fees. Loans of securities involve a risk that the borrower may fail
to return the securities or may fail to provide additional collateral.

Securities loans will be made in accordance with the following
conditions: (1) the Funds or the Portfolio must receive at least 100%
collateral in the form of cash or cash equivalents, securities of the U.S.
Government and its agencies and instrumentalities, and approved bank letters of
credit; (2) the borrower must increase the collateral whenever the market value
of the loaned securities (determined on a daily basis) rises above the level of
collateral; (3) the Funds or the Portfolio must be able to terminate the loan
after notice, at any time; (4) the Funds or the Portfolio must receive
reasonable interest on the loan or a flat fee from the borrower, as well as
amounts equivalent to any dividends, interest or other distributions on the
securities loaned, and any increase in market value of the loaned securities;
(5) the Funds or the Portfolio may pay only reasonable custodian fees in
connection with the loan; and (6) voting rights on the securities loaned may
pass to the borrower, provided, however, that if a material event affecting the
investment occurs, the Board of Trustees or AMR Trust Board, as applicable, must
be able to terminate the loan and vote proxies or enter into an alternative
arrangement with the borrower to enable to Board of Trustees or AMR Trust Board,
as applicable, to vote proxies.

Repurchase Agreements (All Funds). The Funds may invest in
securities subject to repurchase agreements with any bank or registered
broker-dealer who, in the opinion of the Trustees or the AMR Trust Board, as
applicable, present a minimum risk of bankruptcy. Such agreements may be
considered to be loans by the Funds for purposes of the Investment Company Act
of 1940, as amended (the "1940 Act"). A repurchase agreement is a transaction
in which the seller of a security commits itself at the time of the sale to
repurchase that security from the buyer at a mutually agreed-upon time and
price. The repurchase price exceeds the sale price, reflecting an agreed-upon
interest rate effective for the period the buyer owns the security subject to
repurchase. The agreed-upon rate is unrelated to the interest rate on that
security. The Adviser and the Portfolio Advisers will monitor the value of the
underlying security at the time the

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<PAGE> 75
transaction is entered into and at all times during the term of the repurchase
agreement to insure that the value of the security always equals or exceeds the
repurchase price. In the event of default by the seller under the repurchase
agreement, the Funds may have problems in exercising their rights to the
underlying securities and may incur costs and experience time delays in
connection with the disposition of such securities.

Reverse Repurchase Agreements (All Funds). The Funds may also
enter into reverse repurchase agreements to avoid selling securities during
unfavorable market conditions to meet redemptions. Pursuant to a reverse
repurchase agreement, a Fund will sell portfolio securities and agree to
repurchase them from the buyer at a particular date and price. Whenever a Fund
enters into a reverse repurchase agreement, it will establish a segregated
account in which it will maintain liquid assets in an amount at least equal to
the repurchase price marked to market daily (including accrued interest), and
will subsequently monitor the account to ensure that such equivalent value is
maintained. The Fund pays interest on amounts obtained pursuant to reverse
repurchase agreements. Reverse repurchase agreements are considered to be
borrowings by a Fund under the 1940 Act.

Guaranteed Investment Contracts (Short-Term Bond Fund). The
Fund may invest in guaranteed investment contracts ("GICs") issued by insurance
companies. Pursuant to such contracts, the Fund makes cash contributions to a
deposit fund of the insurance company's general account. The insurance company
then credits to the deposit fund on a monthly basis guaranteed interest at a
rate based on an index. The GICs provide that this guaranteed interest will
not be less than a certain minimum rate. The insurance company may assess
periodic charges against a GIC for expense and service costs allocable to it,
and these charges will be deducted from the value of the deposit fund. The
Fund will purchase a GIC only when the Adviser has determined that the GIC
presents minimal credit risks to the Fund and is of comparable quality to
instruments in which the Fund may otherwise invest. Because the Fund may not
receive the principal amount of a GIC from the insurance company on seven days'
notice or less, a GIC may be considered an illiquid investment. The term of a
GIC will be one year or less.

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In determining the average weighted portfolio maturity of the
Fund, a GIC will be deemed to have a maturity equal to the period of time
remaining until the next readjustment of the guaranteed interest rate. The
interest rate on a GIC may be tied to a specified market index and is
guaranteed not to be less than a certain minimum rate.

Illiquid Securities (All Funds). Each Fund, except for the
International Multi-Manager Stock Fund, has adopted a fundamental policy with
respect to investments in illiquid securities. Historically, illiquid
securities have included securities subject to contractual or legal
restrictions on resale because they have not been registered under the
Securities Act of 1933, as amended ("Securities Act"), securities that are
otherwise not readily marketable and repurchase agreements having a maturity of
longer than seven days. Securities that have not been registered under the
Securities Act are referred to as private placements or restricted securities
and are purchased directly from the issuer or in the secondary market. Mutual
funds do not typically hold a significant amount of these restricted or other
illiquid securities because of the potential for delays on resale and
uncertainty in valuation. Limitations on resale may have an adverse effect on
the marketability of portfolio securities and a mutual fund might be unable to
dispose of restricted or other illiquid securities promptly or at reasonable
prices and might thereby experience difficulty satisfying redemptions within
seven days. A mutual fund might also have to register such restricted
securities in order to dispose of them resulting in additional expense and
delay. Adverse market conditions could impede such a public offering of
securities.

In recent years, however, a large institutional market has
developed for certain securities that are not registered under the Securities
Act, including repurchase agreements, commercial paper, foreign securities,
municipal securities and corporate bonds and notes. Institutional investors
depend on either an efficient institutional market in which the unregistered
security can be readily resold or on the issuer's ability to honor a demand for
repayment. The fact that there are contractual or legal restrictions on resale
to the general public or to certain institutions may not be indicative of the
liquidity of such investments.

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<PAGE> 77
Each Fund may also invest in restricted securities issued
under Section 4(2) of the Securities Act, which exempts from registration
"transactions by an issuer not involving any public offering." Section 4(2)
instruments are restricted in the sense that they can only be resold through
the issuing dealer and only to institutional investors; they cannot be resold
to the general public without registration. Restricted securities issued under
Section 4(2) of the Securities Act will be treated as illiquid and subject to
the Fund's investment restriction on illiquid securities.

The Commission has adopted Rule 144A, which allows a broader
institutional trading market for securities otherwise subject to restrictions
on resale to the general public. Rule 144A establishes a "safe harbor" from
the registration requirements of the Securities Act applicable to resales of
certain securities to qualified institutional buyers. It is the intent of the
Funds' to invest, pursuant to procedures established by the Board of Trustees
or the AMR Trust Board, as applicable, and subject to applicable investment
restrictions, in securities eligible for resale under Rule 144A which are
determined to be liquid based upon the trading markets for the securities.

Pursuant to guidelines set forth by and under the supervision of the
Board of Trustees or the AMR Trust Board, as applicable, the Adviser or the
Portfolio Advisers, will monitor the liquidity of restricted securities in a
Fund's portfolio. In reaching liquidity decisions, the Adviser will consider,
among other things, the following factors: (1) the frequency of trades and
quotes for the security over the course of six months or as determined in the
discretion of the Adviser or the Portfolio Advisers, as applicable; (2) the
number of dealers wishing to purchase or sell the security and the number of
other potential purchasers over the course of six months or as determined in
the discretion of the Investment Adviser; (3) dealer undertakings to make a
market in the security; (4) the nature of the security and the marketplace in
which it trades (e.g., the time needed to dispose of the security, the method
of soliciting offers and the mechanics of the transfer); and (5) other factors,
if any, which the Adviser deems relevant. The Adviser will also monitor the
purchase of Rule 144A securities to assure that the total of all Rule 144A
securities held by a Fund does not exceed 10% of the

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Fund's average daily net assets. Rule 144A securities which are determined to
be liquid based upon their trading markets will not, however, be required to be
included among the securities considered to be illiquid for purposes of
Investment Restriction No. 1. Investments in Rule 144A securities could have
the effect of increasing Fund illiquidity.

Foreign Currency Transactions (International Multi-Manager
Stock Fund). Investments by the Portfolio in securities of foreign companies
will usually involve the currencies of foreign countries. In addition, the
Portfolio may temporarily hold funds in bank deposits in foreign currencies
pending the completion of certain investment programs. Accordingly, the value
of the assets of the Portfolio, as measured in U.S. dollars, may be affected by
changes in foreign currency exchange rates and exchange control regulations.
In addition, the Portfolio may incur costs in connection with conversions
between various currencies. The Portfolio may conduct foreign currency
exchange transactions either on a spot (i.e., cash) basis at the spot rate
prevailing in the foreign currency exchange market or by entering into foreign
currency forward basis at the spot rate prevailing in the foreign currency
exchange market or by entering into foreign currency forward contracts
("forward contracts") to purchase or sell foreign currencies. A forward
contract involves an obligation to purchase or sell a specific currency at a
future date, which may be any fixed number of days (usually less than one year)
from the date of the contract agreed upon by the parties, at a price at the
time of the contract. Forward contracts in the principal foreign currencies
are traded in the interbank market conducted directly between currency traders
(usually large commercial banks) and their customers and involve the risk that
the other party to the contract may fail to deliver currency when due, which
could result in losses to the Portfolio. A forward contract generally has no
requirement, and no commissions are charged at any stage for trades. Foreign
exchange dealers realize a profit based on the difference between the price at
which they buy and sell various currencies.

The Portfolio may enter into forward contracts under two
circumstances. First, with respect to specific transactions, when the
Portfolio enters into a contract for the purchase or sale of a security
denominated in a foreign currency, it may desire to "lock in" the U.S. dollar
price of the security. By

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entering into a forward contract for the purchase or sale, for a fixed amount
of dollars, of the amount of foreign currency involved in the underlying
security transactions, the Portfolio may be able to protect itself against a
possible loss resulting from an adverse change in the relationship between the
U.S. dollar and the subject foreign currency during the period between the date
the security is purchased or sold and the date on which payment is made or
received.

Second, the Portfolio may enter into forward contracts in
connection with existing portfolio positions. For example, when the Portfolio
Advisers of the Portfolio believes that the currency of a particular foreign
country may suffer a substantial decline against the U.S. dollar, the Portfolio
may enter into a forward contract to sell, for a fixed amount of dollars, the
amount of foreign currency approximating the value of some or all of the
Portfolio's investment securities denominated in such foreign currency.

The precise matching of the forward contract amounts and the
value of the securities involved will not generally be possible since the
future value of such securities in foreign currencies will change as a
consequence of market movements in the value of those securities between the
date the forward contract is entered into and the date it matures. The
projection of short-term currency market movement is extremely difficult, and
the successful execution of a short-term hedging strategy is highly uncertain.
Forward contracts involve the risk of inaccurate predictions of currency price
movements, which may cause the Portfolio to incur losses on these contracts and
transaction costs. The Portfolio Advisers do not intend to enter into forward
contracts on a regular or continuous basis.

There is no systematic reporting of last sale information for
foreign currencies, and there is no regulatory requirement that quotations
available through dealers or other market sources be firm or revised on a
timely basis. Quotation information available is generally representative of
very large transactions in the interbank market. The interbank market is
foreign currencies in a global around-the-clock market.

When required by applicable regulatory guidelines, the
Portfolio will set aside cash, U.S. Government Securities or

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other liquid, high-grade debt securities in a segregated account with its
custodian in the prescribed amount.

Foreign Currency Options and Related Risks (International
Multi-Manager Stock Fund). The Portfolio may take positions in options on
foreign currencies in order to hedge against the risk of foreign exchange
fluctuation on foreign securities the Portfolio holds in its portfolio or which
it intends to purchase. Options on foreign currencies are affected by the
factors discussed in "Options Strategies" and "Foreign Currency Transactions"
above which influence foreign exchange sales and investments generally.

The value of foreign currency options is dependent upon the
value of the foreign currency relative to the U.S. dollar and has no
relationship to the investment merits of a foreign security. Because foreign
currency transactions occurring in the interbank market involve substantially
larger amounts than those that may be involved in the use of foreign currency
options, the Portfolio may be disadvantaged by having to deal in an odd lot
market (generally consisting of transactions of less than $1 million) for the
underlying foreign currencies at prices that are less favorable than for round
lots.

To the extent that the U.S. options markets are closed while
the market for the underlying currencies remains open, significant price and
rate movements may take place in the underlying markets that cannot be
reflected in the options markets.

The Portfolio Adviser's Approach to Stock Selection. The
Portfolio Advisers will select equity securities which, in their opinion, have
above average growth potential and are also selling at a discount to the
market. This approach focuses on the purchase of a diverse group of stocks
below their perceived economic value. Each of the Portfolio Advisers
determines the growth prospects of firms based upon a combination of internal
and external research using fundamental economic cycle analysis and considering
changing economic trends. The determination of value is based upon the
analysis of several characteristics of the issuer and its equity securities
including price to earnings ratio, price to book value ratio, assets carried
below market value, financial strength and dividend yield.

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INVESTMENT RESTRICTIONS

The following restrictions apply to each Fund except the
International Multi-Manager Stock Fund and restate or are in addition to those
restrictions described under "Investment Restrictions" in the Prospectuses.
Unless otherwise indicated, only Investment Restriction Nos. 2, 3, 4, 7, 8, 12
and 16 are fundamental policies of the Funds, which can be changed only when
permitted by law and approved by a majority of the Funds' outstanding voting
securities. The non-fundamental investment restrictions can be changed by
approval of a majority of the Board of Trustees. A "majority of the
outstanding voting securities" means the lesser of (i) 67% of the shares
represented at a meeting at which more than 50% of the outstanding shares are
represented in person or by proxy or (ii) more than 50% of the outstanding
shares.

Each Fund, except as indicated, may not:

(1) Invest more than 15% (10% with respect to the Money
Market Fund and Kansas Tax-Exempt Bond Fund) of the value of its net
assets in investments which are illiquid (including repurchase
agreements having maturities of more than seven calendar days,
variable and floating rate demand and master demand notes not
requiring receipt of principal note amount within seven days notice
and securities of foreign issuers which are not listed on a recognized
domestic or foreign securities exchange);

(2) Borrow money or pledge, mortgage or hypothecate its
assets, except that a Fund may enter into reverse repurchase
agreements or borrow from banks up to 33-1/3% (10% for Kansas
Tax-Exempt Bond Fund) of the current value of its net assets for
temporary or emergency purposes or to meet redemptions. Each Fund
(except Kansas Tax-Exempt Bond Fund) has adopted a non-fundamental
policy to limit such borrowing to 10% of its net assets and those
borrowings may be secured by the pledge of not more than 15% of the
current value of its total net assets (but investments may not be
purchased by the Fund while any such borrowings exist). With respect
to the Kansas Tax-Exempt Bond Fund, all

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borrowings in excess of 5% will be repaid before additional
investments are made. The Short-Term Bond Fund has adopted a
non-fundamental policy to limit its borrowings for other than
temporary or defensive purpose or to meet redemptions to an amount not
to exceed an amount equal to 5% of its net assets.

(3) Issue senior securities, except insofar as a Fund may
be deemed to have issued a senior security in connection with any
repurchase agreement or any permitted borrowing;

(4) Make loans, except loans of portfolio securities and
except that a Fund may enter into repurchase agreements with respect
to its portfolio securities and may purchase the types of debt
instruments described in its Prospectus or the SAI;

(5) Invest in companies for the purpose of exercising
control or management. This restriction is a fundamental policy of
the Kansas Tax-Exempt Bond Fund;

(6) Invest more than 10% of its net assets in shares of
other investment companies, except that the Kansas Tax-Exempt Bond
Fund may only purchase money market fund securities and that each Fund
may invest all of its assets in another investment company;

(7) Invest in real property (including limited
partnership interests but excluding real estate investment trusts and
master limited partnerships, debt obligations secured by real estate
or interests therein, and securities issued by other companies that
invest in real estate or interest therein), commodities, commodity
contracts, or oil, gas and other mineral resource, exploration,
development, lease or arbitrage transactions. The Kansas Tax-Exempt
Bond Fund's policy with respect to oil, gas and other mineral
resource, exploration, development or leases is a non-fundamental
policy;

(8) Engage in the business of underwriting securities of
other issuers, except to the extent that the disposal of an investment
position may technically cause it to be

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<PAGE> 83
considered an underwriter as that term is defined under the Securities
Act of 1933;

(9) Sell securities short, except to the extent that a
Fund contemporaneously owns or has the right to acquire at no
additional cost securities identical to those sold short. The Kansas
Tax-Exempt Bond Fund may not sell securities short;

(10) Purchase securities on margin, except that a Fund may
obtain such short-term credits as may be necessary for the clearance
of purchases and sales of securities;

(11) Purchase or retain the securities of any issuer, if
those individual officers and Trustees of the Trust, the Adviser, the
Sponsor, or the Distributor, each owning beneficially more than 1/2
of 1% of the securities of such issuer, together own more than 5% of
the securities of such issuer;

(12) Purchase a security if, as a result, more than 25% of
the value of its total assets would be invested in securities of one
or more issuers conducting their principal business activities in the
same industry (except that this restriction does not apply to the
Money Market Fund which will concentrate its investments in
obligations issued by the banking industry), provided that (a) this
limitation shall not apply to obligations issued or guaranteed by the
U.S. Government or its agencies and instrumentalities; (b)
wholly-owned finance companies will be considered to be in the
industries of their parents; and (c) utilities will be divided
according to their services. For example, gas, gas transmission,
electric and gas, electric, and telephone will each be considered a
separate industry;

(13) Invest more than 5% of its net assets in warrants
which are unattached to securities, included within that amount, no
more than 2% of the value of the Fund's net assets, may be warrants
which are not listed on the New York or American Stock Exchanges. The
Kansas Tax-Exempt Bond Fund may not purchase warrants.

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<PAGE> 84
(14) Write, purchase or sell puts, calls or combinations
thereof, except that the Funds may purchase or sell puts and calls as
otherwise described in the Prospectus or SAI; however, no Fund will
invest more than 5% of its total assets in these classes of securities
for purposes other than bona fide hedging; or

(15) Invest more than 5% of the current value of its total
assets in the securities of companies which, including predecessors,
have a record of less than three years' continuous operation (except
(i) obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities or (ii) municipal securities which are
rated by at least two NRSRO's or determined by the Adviser to be of
comparable quality) provided each Fund may invest all or a portion of
its assets in another open end management investment company with
substantially the same investment objective, policies and investment
restrictions as the Fund; or

(16) With respect to 75% of its assets purchase a security if
as a result, (1) more than 5% of its total assets would be invested in
any one issuer other than the U.S. Government or its agencies or
instrumentalities, or (2) the Fund would own more than 10% of the
outstanding voting securities of such issues. The Money Market Fund
is subject to the above restriction with respect to 100% of its assets.
The Kansas Tax-Exempt Bond Fund will not purchase more than 10% of the
voting securities of any one issuer.

The following restrictions apply to the International
Multi-Manager Stock Fund. All fundamental investment policies and
non-fundamental policies of the Fund and the Portfolio are identical.
Therefore, although the following discusses the investment policies of the
Portfolio and the AMR Trust Board, it applies equally to the Fund and the
Trust's Board of Trustees.

The following seven restrictions have been adopted by the
Portfolio and may be changed with respect to the Portfolio only by the majority
vote of the Portfolio's outstanding interests, which as used herein means the
lesser of (a) 67% of the interests of the Portfolio present at the meeting if
the holders of more than 50% of the interests are present and

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<PAGE> 85
represented at the interest holders' meeting or (b) more than 50% of the
interests of the Portfolio. Whenever the Fund is requested to vote on a change
in the investment restrictions of the Portfolio, the Fund will hold a meeting
of its shareholders and will cast its votes as instructed by its shareholders.

The Portfolio may not:

1. With respect to 75% of its total assets purchase a
security if as a result, (1) more than 5% of its total assets would be
invested in securities of any one issuer other than obligations issued
by the U.S. Government, its agencies and instrumentalities, or (2) the
Fund would own more than 10% of the voting securities of any one
issuer.

2. Invest more than 25% of its total assets in the
securities of companies primarily engaged in any one industry other
than the U.S. Government, its agencies and instrumentalities. In
addition, finance companies as a group are not considered a single
industry for purposes of this Policy. Wholly-owned subsidiaries of
finance companies will be considered to be in the industries of their
parent companies if their activities are primarily related to
financing the activities of their parent.

3. Purchase or sell real estate or real estate limited
partnership interests, provided, however, that the Portfolio may
invest in securities secured by real estate or interests therein or
issued by companies which invest in real estate or interests therein
when consistent with the other policies and limitations described in
the Prospectus.

4. Purchase or sell commodities (including direct
interests and/or leases in oil, gas or minerals) or commodities
contracts, except with respect to forward foreign currency exchange
contracts, foreign currency futures contracts and "when-issued"
securities when consistent with the other policies and limitations
described in the Prospectus.

5. Engage in the business of underwriting securities
issued by others, except to the extent that, in connection

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<PAGE> 86
with the disposition of securities, the Portfolio may be deemed an
underwriter under federal securities law.

6. Make loans to any person or firm, provided, however,
that the making of a loan shall not be construed to include (i) the
acquisition for investment of bonds, debentures, notes or other
evidences of indebtedness of any corporation or government which are
publicly distributed or (ii) the entry into repurchase agreements and
further provided, however, that the Portfolio may lend its portfolio
securities to broker-dealers or other institutional investors in
accordance with the guidelines stated in the Prospectus.

7. Purchase from or sell portfolio securities to its
officers, Trustees or other "interested persons," as defined under the
1940 Act, of the AMR Trust, including its investment advisers and
their affiliates, except as permitted by the 1940 Act and exemptive
rules or orders thereunder.

8. Issue senior securities except that the Portfolio may
engage in when-issued securities and forward commitment transactions
and may engage in currency futures and forward currency contracts; or

9. Borrow money, except from banks or through reverse
repurchase agreements for temporary purposes in an aggregate amount
not to exceed 10% of the value of its total assets at the time of
borrowing. In addition, although not a fundamental policy, the
Portfolio intends to repay any money borrowed before any additional
portfolio securities are purchased.

The following non-fundamental investment restrictions apply to
the Portfolio and may be changed with respect to the Portfolio by a majority
vote of the AMR Trust Board. The Portfolio may not:

1. Purchase securities on margin, effect short sales
(except that the Portfolio may obtain such short-term credits as may
be necessary for the clearance of purchases

-21-
<PAGE> 87

or sales of securities) or purchase or sell call options or engage in
the writing of such options; or

2. Purchase or retain the securities of an issuer if, to
the AMR Trust's knowledge, one or more of the trustees or officers of
the AMR Trust, or the investment adviser responsible for the
investment of the AMR Trust's assets or its directors or officers,
individually own beneficially more than 1/2 of 1% of the securities
of such issuer and together own beneficially more than 5% of such
securities.

The Portfolio may invest up to 10% of its total assets in the
securities of other investment companies to the extent permitted by law. The
Portfolio may incur duplicate advisory or management fees when investing in
another mutual fund.

In addition, the Portfolio may not invest in warrants, except
as permitted by its investment policies as described in the Prospectus,
provided that the Portfolio shall not invest more than 5% of its net assets,
valued at the lower of cost or market, in warrants or more than 2% of its net
assets in warrants which are not listed on the New York or American Stock
Exchanges.

KANSAS RISK FACTORS

The following information is a brief summary of particular
Kansas state factors effecting the Kansas Tax-Exempt Bond Fund and does not
purport to be a complete description of such factors. The financial condition
of the state, its public authorities and local governments could affect the
market values and marketability of, and therefore the net asset value per share
and the interest income of the Fund, or result in the default of existing
obligations, including obligations which may be held by the Fund. Further, the
state faces numerous forms of litigation seeking significant damages which, if
awarded, may adversely affect the financial situation of the state or issuers
located in

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<PAGE> 88
such state. It should be noted that the creditworthiness of obligations issued
by local issues may be unrelated to the creditworthiness of a state, and there
is no obligation on the part of the state to make payment on such local
obligations in the event of default in the absence of a specific guarantee or
pledge provided by a state. The information contained below is based primarily
upon information derived from state official statements, Certified Annual
Financial Reports, state and industry trade publications, newspaper articles,
other public documents relating to securities offerings of issuers of such
states, and other historically reliable sources. It has not been independently
verified by the Fund. The Fund makes no representation or warranty regarding
the completeness or accuracy of such information. The market value of shares
of the Fund may fluctuate due to factors such as change in interest rates,
matters affecting a particular state, or for other reasons.

General Economic Conditions. Kansas is the 14th largest state
in terms of size with an area in excess of 82,000 square miles. It is
rectangular in shape and is 411 miles long from east to west and 208 miles
wide. The geographic center of the 48 contiguous states lies within its
borders. Kansas became the 34th state in 1861 and Topeka was chosen to be the
capitol later that year. The population of the State of Kansas has grown from
2,477,588 in 1990 to 2,554,047 in 1994. This represents a percentage increase
of 3.1%. In comparison, the growth in population of the United States was 4.7%.

Relatively strong growth in manufacturing and construction
employment propelled the state's 1995 employment growth. Employment growth
exceeded the national rate of increase, a rarity in recent years. In only three
of the prior 13 years had Kansas employment growth exceeded that of the nation.
All but one of the state's major labor markets (finance, insurance and real
estate) had employment gain between 1994 and 1995. There are two measures of
employment in Kansas: place-of-residence data and place-of-work data. The
former are based on a sample survey of Kansas households, while the latter are
based on data primarily obtained directly from firms as part of the
unemployment insurance program. In 1995, place-of-residence data indicated that
Kansas employment grew 2.8%, while place-of-work data showed

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<PAGE> 89
a 5.4% increase. The growth rates exceeded the corresponding national growth
rates of 1.6% and 2.3%. Average monthly unemployment fell from 70,000 in 1994
to 56,200 in 1995. Likewise the average monthly unemployment rate fell from
5.3% to 4.2% from 1994 to 1995.

Budgetary Process. The Governor is statutorily mandated to
present spending recommendations to the Legislature. "The Governor's Budget
Report" reflects expenditures for both the current and upcoming fiscal years
and identifies the sources of financing for those expenditures. The Legislature
uses "The Governor's Budget Report" as a guide as it appropriates the money
necessary for state agencies to operate. Only the Legislature can authorize
expenditures by the State of Kansas. The Governor recommends spending levels,
while the Legislature chooses whether to accept or modify those
recommendations. The Governor may veto legislative appropriations, although the
Legislature may override any veto by two-thirds majority vote.

The state "fiscal year" runs from July 1 to the following June
30 and is numbered for the calendar year in which it ends. The "current fiscal
year" is the one which ends the coming June. The "actual fiscal year" is the
year which concluded the previous June. The "budget year" refers to the next
fiscal year, which begins the July following the Legislature's adjournment.

In "The FY 1997 Governor's Budget Report," the actual fiscal
year is fiscal year 1995, the current fiscal year is fiscal year 1996, and the
budget year is fiscal year 1997. By law, "The Governor's Budget Report" must
reflect actual year spending, the Governor's revised spending recommendations
for the current fiscal year, state agency spending requests for the budget
year, and the Governor's spending recommendations for the budget year. The
budget recommendations cannot include the expenditure of anticipated income
attributable to proposed legislation.

Revenues and Expenditures. The State General Fund is the
largest of the "uncommitted" revenue sources available to the state. It is also
the fund to which most general tax receipts are credited. The Legislature may
spend State General Fund dollars for any purpose. All revenues coming into the
state treasury not

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<PAGE> 90
specifically authorized by statute or the constitution to be placed in a
separate fund are deposited in the State General Fund.

Fiscal Year 1996. The Governor's fiscal year 1996 budget
recommendations total $7.9 billion from all funding sources and approximately
$3.47 billion from the State General Fund. The budget includes a total of
44,697 state employees, a reduction of 118 from the amount approved by the
1995 Legislature. These recommendations reflect significant changes to the
budget approved by the 1995 Legislature. In September 1995, the Governor
announced the need for a 1.5% across-the-board reduction to the budgets of most
agencies funded through the State General Fund. This action was necessary
because of a shortfall of approximately $25 million in estimated fiscal year
1995 receipts and resulting downward revisions to the consensus revenue
estimate made for fiscal year 1996. In addition to the 1.5% reduction,
significant savings were available in agency budgets because of a reduction in
the funding requirements for group health insurance rates for state employees
and in the funding necessary for the state share of local option school
budgets. In total, these adjustments allow the Governor to recommend a budget
which maintains the targeted 7.5% ending balance for fiscal year 1996 while
providing only necessary supplemental appropriations to maintain commitments to
higher education and public schools. In addition, the Governor directed all
agencies under his supervision to reduce their workforce by 2% in fiscal year
1996 through attrition and retirements. The salary savings attributable to
those reductions will be identified at the end of the fiscal year.

Fiscal Year 1997. The fiscal year 1997 budget recommendations
include all funding source expenditures of $7.8 billion, a reduction of almost
$100 million from fiscal year 1996. The largest single source of fiscal year
1997 receipts is the State General Fund, with 46.6% of the total receipts.
Individual income taxes account for the largest source of State General Fund
revenue, totaling $1.410 billion (39.9%) in fiscal year 1997. The next largest
category, sales and use taxes, is projected to generate $1.392 billion (39.5%)
for the State General Fund during fiscal year 1997. State General Fund
expenditure recommendations for fiscal year 1997 are $3.52 billion, an increase
of 1.4%. The Governor recommends that

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<PAGE> 91
$1,923.7 million, or 54.6% of State General Fund expenditures be used for aid
to local units of government.

Federal grants represent 21.9% of total receipts from all
funding sources, with 42 state agencies receiving $1.7 billion in fiscal year
1997. Of the $1.7 billion, 50.4% will go to the Department of Social and
Rehabilitation Services. This is followed by the Department of Transportation,
15.4%, the Department of Education, 12%, the Regents institutions, 5.8%, and
the Department of Health and Environment, 4.3%. The remaining 12.1% is
distributed to 29 other agencies. Agency service charges include revenues
received for services provided by state agencies. This includes charges for
inspections, examinations, and audits; fees collected for tuition and fees at
the Regents institutions; and admissions to the Kansas State Fair. This revenue
category represents 6.6% of total receipts for fiscal year 1997.

Dedicated sales tax receipts represent revenues from four
taxes that are collected for a specific purpose and are deposited in special
revenue funds, rather than the State General Fund. Taxes on motor fuels and
vehicle registrations as well as a dedicated sales tax of one-quarter of a cent
are credited to the State Highway Fund. A statewide property tax of 1.5 mills
is assessed for construction and maintenance of state buildings at Regents
institutions and state hospitals. This revenue category represents 5.1% of
total receipts for fiscal year 1997.

Other special revenue receipts include license fees, interest
earnings on special revenue funds, non-federal grants, the sale of state
property, and numerous other miscellaneous revenue sources. This revenue
category represents 8.9% of total receipts for fiscal year 1997. Non revenue
receipts are collections and reimbursements not considered revenue. Examples
include collections by the Department of Human Resources for the payment of
unemployment benefits and collections by KPERSS for payment of retirement
benefits. Collections made by SRS from absent parents for child support are
also included in this category. This category represents 8.5% of total receipts
for fiscal year 1997. Lottery ticket sales account for the remaining 2.4% of
total receipts for fiscal year 1997 from all funding sources.

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<PAGE> 92
It was clear from the beginning of the fiscal year 1997 budget
process that the revenues available to state government could not support
continuation of existing levels of service for all agencies. A variety of
factors contributed to the austerity of the fiscal year 1997 budget. First and
most important, for the past two fiscal years, the State General Fund ending
balance was significantly above the 7.5% ending balance target, allowing
expenditures to exceed receipts in both fiscal years 1995 and 1996. In simple
terms, fiscal year 1997 cannot exceed receipts while complying with the ending
balance requirements. The expenditures in fiscal year exceeded receipts by
$106.6 million. In effect, the first claim on projected increases in State
General Fund receipts for fiscal year 1997 will be to correct this imbalance.
Second, a variety of factors required significant additional funding for the
school finance formula including enrollment growth, the second year of
increased aid requirements to offset motor vehicle tax reductions passed by the
1995 Legislature, the remainder of the Real Estate Settlement Procedures Act
(RESPA) adjustment, and growth in capital improvement aid. In addition, growth
in inmate populations required additional staff and funding for correctional
institutions. Further, caseload and cost increases in various populations
served by SRS seriously affected the fiscal year 1997 budget.

Debt Administration and Limitation. The State of Kansas
finances a portion of its capital expenditures with various debt instruments.
Of capital expenditures that are debt-financed, revenue bonds and loans from
the Pooled Money Investment Board finance most capital improvements for
buildings, and certificates of participation and "third-party" financing pay
for most capital equipment. The Kansas Constitution makes provision for the
issuance of general obligation bonds subject to certain restrictions; however,
no bonds have been issued under this provision for many years. No other
provision of the Constitution or state statute limits the amount of debt that
can be issued. As of June 30, 1995, the state had authorized but unissued debt
of $27,230,000.

Although the state has no General Obligation rating, it seeks
an underlying rating on specific issues of at least "AA-" from Standard &
Poor's and "A1" from Moodys. The ratings for the most recently issued fixed
rate bonds issued by the Kansas

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<PAGE> 93
Department of Transportation were "Aa" and "AA" from Moodys and Standard &
Poor's respectively. The Kansas Development Finance Authority is currently
working with the rating agencies to obtain a rating indicator for the State of
Kansas.

The Kansas Department of Transportation issues debt to finance
highway projects. The Comprehensive Highway Program began during fiscal year
1989. The 20-year bonds will be retired with motor fuel taxes, motor vehicle
registration fees, retail sales and compensating use taxes, and accrued
interest. During fiscal years 1994 and 1995, the state sold bonds totaling
approximately $151 million and $167.1 million, respectively. Again, the largest
use of the bond proceeds was $125 million and $140 million for the
Comprehensive Highway Program for these two years, respectively.

Other State of Kansas debt is issued by the Kansas Development
Finance Authority (KDFA), an independent instrumentality of the state which was
created in 1987 for this purpose. The Governor's budget recommendations for
Regents institutions are a significant departure from the traditional way
revenues from the Educational Building Fund (EBF) have been used for
construction projects at the state's universities. Based on concerns for the
aging buildings on the state's campuses, the Governor recommends that KDFA
issue bonds in fiscal year 1997 in the amount of $156.5 million to address a
wide variety of rehabilitation and repair projects at the universities. With
interest earnings, the total project costs would be an estimated $163.6
million. Debt service over the 15-year period will total $228.4 million, with
each year's debt service payment over the next 15 years totaling $15 million.
No project paid with bond proceeds will have a life-expectancy of less than 20
years, so as to "keep ahead" of the bonded indebtedness. Because the current
cost of borrowing money is less than the projected cost of inflation for
construction, it is more cost-effective to perform the repairs now and leverage
the EBF, rather than incurring higher annual repair costs in the future.
Rehabilitation and repair projects at the campuses include compliance with the
Americans with Disability Act Accessibility Guidelines and life safety codes,
energy conservation projects, and improvements to classrooms, in addition to
the typical repairs made to aging buildings.

Bonds totaling $4.4 million were issued by KDFA in November
1990 to begin Energy Conservation Improvements Program authorized by the 1990
Legislature. The bonds are retired by utility cost savings from the energy
conservation improvements undertaken. Projects financed with the bond proceeds
consist of

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<PAGE> 94
improvements at many of the state universities, the Department of
Administration, the Department of Social and Rehabilitation Services, the
Highway Patrol, and the Department of Corrections. An amount of $5,000 was
appropriated from the State General Fund to the Department of Administration,
the paying agent, for fiscal year 1992 to begin retirement of the debt service.
The second series of bonds, issued in June 1992, totaled $3.6 million. On
October 1, 1993, a third series of bonds totaling $4,370,000 under the Energy
Conservation Improvements Program was issued. In August 1995, the fourth series
of bond, totaling $2,734,000 was issued. For fiscal year 1997, the debt service
totals $1,785,007 from the State General Fund, $1,340,000 for principal and
$445,007 for interest. To date, $15.1 million in bonds has been issued by the
Kansas Development Finance Authority for those projects. A fifth bond issue
estimated to total $4.8 million is scheduled for early 1996.

MANAGEMENT

Trustees and Officers

The age, address and principal occupations for the past five
years of each Trustee and executive officers of the Trust are listed below.
[The address of each, unless otherwise indicated, is 3435 Stelzer Road,
Columbus, Ohio 43219.]

G.L. BEST, Age: 48, Trustee. Vice President, Finance and Administration, of
Williams Energy Services Company; Treasurer of The Williams Companies
(1992-1995).

TERRY L. CARTER, Age: 47, Trustee. Senior Vice President of QuikTrip
Corporation.

THOMAS F. KICE, Age: 47, Trustee. President of Kice Industries Inc.

GEORGE MILEUSNIC, Age: 42, Trustee. Executive Vice President of Operations of
North American Advisory of The Coleman Co., Inc.; Chief Financial
Officer of The Coleman Co., Inc.

JOHN J. PILEGGI, Age: 37, Chairman of the Board of Trustees. Director of
Furman Selz LLC since 1994; Senior Managing Director of Furman Selz LLC
(1992-1994); Managing Director of Furman Selz LLC (1984-1992).

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<PAGE> 95
THOMAS E. SHEA, Age: 47, Trustee. Treasurer of Western Resources, Inc., a
diversified energy company.

Eric Rubin, Age: 30, President and Treasurer. Managing Director, Furman Selz
LLC, since June 1995; Vice President and Managing Director, Bank One Investment
Adviser, November 1993 to June 1995; Associate Director, Furman Selz LLC, 1989
to 1993.

CARRIE ZUCKERMAN, Age: 29, Assistant Secretary. Associate Director, Corporate
Secretary Services of Furman Selz LLC, since 1995; Associate of Furman Selz
1993-1995.

Bruce Treff, Age: 30, Assistant Secretary. Counsel, BISYS Fund Services, Inc.
since 1995; Manager, Alliance Capital Management, L.P.

Alaina Metz, Age: 29, Assistant Secretary. Chief Administrator, Administrative
and Regulatory Services, BISYS Fund Services, Limited Partnership, since June
1995; Supervisor, Mutual Fund Legal Department, Alliance Capital Management,
L.P., May 1989 to June 1995.

COMPENSATION TABLE*

<TABLE>
<CAPTION>
Pension or
Retirement
Aggregate Benefits Accrued Estimated Total Compensation
Compensation from as Part of Fund Annual Benefits from the Fund
the Fund Expenses Upon Retirement complex
----------------- --------------- --------------- ------------------
<S> <C> <C> <C> <C>
G.L. Best, Trustee $7,000 0 N/A $ 7,000

Terry L. Carter, Trustee $7,000 0 N/A $ 7,000

Thomas F. Kice, Trustee $7,000 0 N/A $ 7,000

George Mileusnic, Trustee $7,000 0 N/A $ 7,000

John J. Pileggi, Trustee $7,000 0 N/A $ 7,000

Thomas E. Shea, Trustee $7,000 0 N/A $ 7,000
</TABLE>

- -----------------------

* Represents the total compensation estimated to be paid for a full
fiscal year.

Trustees of the Trust not affiliated with the Sponsor receive from the
Trust an annual retainer of $1,000 and a fee of

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<PAGE> 96
$1,000 for each Board of Trustees meeting and $1,000 for each Board committee
meeting of the Trust attended and are reimbursed for all out-of-pocket expenses
relating to attendance at such meetings. Trustees who are affiliated with the
Sponsor do not receive compensation from the Trust.

Officers and Trustees of the Trust, as a group, own less than
1% of the outstanding shares of the Funds.

Trustees and Officers of AMR Investment Services Trust ("AMR Trust")

The following information relates to the principal occupations
of each Trustee and executive officer of the AMR Trust during the past five
years.

Unless otherwise indicated, the address of each person listed
below is 4333 Amon Carter Boulevard, MD 5645, Fort Worth, Texas 76155.

<TABLE>
<CAPTION>
Position with
Name, Age and Address AMR Trust Principal Occupation During Past 5 Years
------------------------------- --------------------- -------------------------------------------
<S> <C> <C>
William F. Quinn* (49) Trustee and President, AMR Investment Services, Inc.
President (November 1986-Present); Chairman, American
Airlines Employees Federal Credit Union
(October 1989-Present); Trustee, American
Performance Funds (September 1990-July
1994); Director, Crescent Real Estate
Equities, Inc. (April 1994-Present);
Trustee, American AAdvantage Funds and
American AAdvantage Mileage Funds
(1995-Present).

Alan D. Feld (59) Trustee Partner, Akin, Gump, Strauss, Hauer & Feld
1700 Pacific Ave., LLP (1960-Present)**, Director, Clear
Suite 4100 Channel Communications (1984-Present);
Dallas, TX 75201-4618 Director, CenterPoint Properties, Inc.
(1994-Present); Trustee, American
AAdvantage Funds and American AAdvantage
Mileage Funds (October 1996-Present).
</TABLE>

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<PAGE> 97
<TABLE>
<S> <C> <C>
Ben J. Fortson (64) Trustee President and CEO, Fortson Oil Company
301 Commerce St., (1958-Present); Director, Kimbell Art
Suite 3301 Foundation (1964-Present); Director,
FortWorth, TX 76102 Burnett Foundation (1987-Present); Honorary
Trustee, Texas Christian University
(1986-Present); Trustee, American
AAdvantage Funds and American AAdvantage
Mileage Funds (October 1996-Present).
</TABLE>

<TABLE>
<S> <C> <C>
John S. Justin (80) Trustee Chairman and Chief Executive Officer,
2821 West Seventh Street Justin Industries, Inc. (a diversified
Fort Worth, Texas 76107 holding company) (1969-Present); Executive
Board Member, Blue Cross/Blue Shield of
Texas (1985-Present); Board Member, Zale
Lipshy Hospital (June 1993-Present);
Trustee, Texas Christian University
(1980-Present); Director and Executive
Board Member, Moncrief Radiation Center
(1985-Present); Director, Texas New Mexico
Enterprises (1984-1993); Director, Texas
New Mexico Power Company (1979-1993);
Trustee, American AAdvantage Funds and
American AAdvantage Mileage Funds
(1995-Present).

Stephen D. O'Sullivan*(61) Trustee Consultant (July 1994-Present); Vice
President and Controller, American
Airlines, Inc. (April 1985-June 1994),
Trustee, American AAdvantage Funds and
American AAdvantage Mileage Funds
(1995-Present)
</TABLE>

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<PAGE> 98
<TABLE>
<S> <C> <C>
Roger T. Staubach (55) Trustee Chairman of the Board and Chief Executive
6750 LBJ Freeway Officer (1982-Present) and President
Dallas, Texas 75240 (1983-1991) of The Staubach Company (a
commercial real estate company); Director,
Halliburton Company (1991-present);
director, First USA, Inc. (1993-present);
Director, Brinker International
(1993-present); Director, Columbus Realty
Trust (1994-present); Member of the
Advisory Board, The Salvation Army; Member
of the Advisory Board, Dallas International
Sports Commission; Member of the Advisory
Board, Hartford Whalers Hockey Club;
Trustee, Institute for Aerobics Research;
Member of Executive Council, Daytop/Dallas;
former quarterback of the Dallas Cowboys
professional football team; Trustee,
American AAdvantage Funds and American
AAdvantage Mileage Funds (1995-Present).

Nancy A. Eckl (34) Vice President Vice President, AMR Investment Services,
Inc. (December 1990-Present).

Michael W. Fields (42) Vice President Vice President, AMR Investment Services,
Inc. (August 1988-Present).

Barry Y. Greenberg (33) Vice President and Director, Legal and Compliance, AMR
Assistant Secretary Investment Services, Inc. (July
1995-Present); Branch Chief (May 1992-June
1995) and Staff Attorney (August 1988-May
1992), Securities and Exchange Commission.

Rebecca L. Harris (29) Treasurer Director of Finance (May 1995-Present),
Controller (November 1991-April 1995), AMR
Investment Services, Inc.

John B. Robertson (38) Vice President Vice President, AMR Investment Services,
Inc. (June 1991-Present)
</TABLE>

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<PAGE> 99
<TABLE>
<S> <C> <C>
Janice B. Schwarz (37) Assistant Secretary Senior Business Systems Coordinator
(September 1996-Present), Senior Compliance
Analyst, AMR Investment Services, Inc.
(December 1990-September 1996).

Clifford J. Alexander (53) Secretary Partner, Kirkpatrick & Lockhart LLP (law
firm)

Robert J. Zutz (44) Assistant Secretary Partner, Kirkpatrick & Lockhart LLP (law
firm)
</TABLE>

* Messrs. Quinn and O'Sullivan, by virtue of their current or former
positions, are deemed to be "interested persons" of the AMR Trust as
defined by the 1940 Act.

** The law firm of Akin, Gump, Strauss, Hauer & Feld LLP ("Akin, Gump")
provides legal services to American Airlines, Inc., an affiliate of AMR
Investment Services, Inc. Mr. Feld has advised the AMR Trust that he has had
no material involvement in the services provided by Akin, Gump to American
Airlines, Inc. and that he has received no material benefit in connection with
these services. Akin, Gump does not provide legal services to AMR Investment
Services, Inc. or AMR Corporation.

All Trustees and officers as a group own less than 1% of the
outstanding shares of the AMR Trust.

As compensation for their service to the AMR Trust, the Independent
Trustees and their spouses receive free air travel from American Airlines,
Inc., an affiliate of AMR. Trustees are also reimbursed for any expenses
incurred in attending Board meetings. Mr. O'Sullivan, who as a retiree of
American Airlines, Inc. already receives free airline travel, receives
compensation annually of up to three round-trip airline tickets for each of his
three adult children. The Trust does not pay for these travel arrangements.
However, the Trust compensates each Trustee with payments in an amount equal to
the Trustees' income tax on the value of this free airline travel. These
amounts are reflected in the following table for the fiscal year ended October
31, 1995.

<TABLE>
<CAPTION>
Pension or
Aggregate Retirement Benefits Estimated
Compensation Accrued as Part of Annual Total Compensation
From the the AMR Benefits Upon From AMR's
Name of Trustee Trust Trust's Expenses Retirement Fund Complex
----------------------------------- ---------------- ---------------------- ----------------- ---------------------
<S> <C> <C> <C> <C>
William F. Quinn $0 $0 $0 $0

David G. Fox $27,510 $0 $0 $27,510

John S. Justin $14,475 $0 $0 $14,475

Stephen D. O'Sullivan $0 $0 $0 $0

Roger T. Staubach(1) $0 $0 $0 $0
</TABLE>

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<PAGE> 100
(1) Mr. Staubach became a Trustee in May 1995 and did not receive tax
reimbursement payments during fiscal year 1995 for his travel during
that year.

Investment Advisers

INTRUST BANK, N.A.

INTRUST Bank, N.A. ("INTRUST") has provided investment
advisory services to the Funds since inception pursuant to an Advisory
Agreement with the Trust (the "Advisory Agreement"). Subject to such policies
as the Trust's Board of Trustees may determine, INTRUST makes investment
decisions for the Funds. The Advisory Agreement provides that, as compensation
for services thereunder, INTRUST is entitled to receive from each Fund it
manages a monthly fee at an annual rate based upon average daily net assets of
the Fund as set forth in the table of Fund Expenses in the Prospectus.

INTRUST is a majority-owned subsidiary of INTRUST Financial
Corporation (formerly First Bancorp of Kansas), a bank holding company.
INTRUST is a national banking association which provides a full range of
banking and trust services to clients. As of September 30, 1996, total assets
under management were approximately $1.17 billion. The principal place of
business address of the Adviser is 105 North Main Street, Box One, Wichita,
Kansas 67201.

The Investment Advisory Contracts for the Funds will continue
in effect for a period beyond two years from the date of their execution only
as long as such continuance is approved annually (i) by the holders of a
majority of the outstanding voting securities of the Funds or by the Board of
Trustees and (ii) by a majority of the Trustees who are not parties to such
Contract or "interested persons" (as defined in the 1940 Act) of any such
party. The Contracts may be terminated without penalty by vote of the Trustees
or the shareholders of the Funds, or by the Adviser, on 60 days' written notice
by either party to the Contract and will terminate automatically if assigned.

ARK Asset Management Co., Inc. ("ARK") serves as sub-adviser
to the Stock Fund. Located in New York, ARK's predecessor was established in
1929 as the private money management division of Lehman Brothers. In 1989, the
division became an independent company when the employees purchased the
institutional money management business from Lehman Brothers. As of September
30, 1996, ARK managed approximately $22.6 billion, including $12.4 billion in
large capitalization value portfolios,

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<PAGE> 101
for more than 260 institutional and individual clients, with a minimum
investment size for private accounts of $10 million.

Galliard Capital Management ("Galliard") serves as sub-adviser
to the Short-Term Bond Fund and the Intermediate Bond Fund. Galliard, a
wholly-owned subsidiary of Norwest Bank Minnesota, was formed July 1, 1995 to
specialize in the management of institutional fixed income portfolios.

AMR Investment Services, Inc. serves as sub-advisor to the
Money Market Fund. AMR, located at 4333 Amon Carter Boulevard, MD 5645, Fort
Worth, Texas 76155, is a wholly-owned subsidiary of AMR Corporation, the parent
company of American Airlines, Inc., and was organized in 1986 to provide
business management, advisory, administrative and asset management consulting
services. American Airlines, Inc. is not responsible for investments made by
AMR. As of September 30, 1996, AMR provides investment advice with respect to
approximately $15.3 billion in assets, including approximately $10.8 billion of
assets on behalf of AMR Corporation and its primary subsidiary, American
Airlines, Inc. For the subadvisory services it provides to the Money Market
Fund, AMR receives from the Adviser and not the Funds monthly fees based upon
average daily net assets at the annual rate of 0.20%.

The Portfolio

AMR oversees all administrative, investment advisory and
portfolio management services to the Portfolio. The assets of the Portfolio
are allocated by AMR among one or more investment advisers. AMR also acts as
investment adviser to the Portfolio and is required to furnish at its expense
all services, facilities and personnel necessary in connection with managing
and administering the Portfolio's investments and effecting portfolio
transactions for the Portfolio.

AMR provides the Portfolio with office space, office equipment
and personnel necessary to manage and administer the Portfolio's operations.
This includes complying with reporting requirements; corresponding with
shareholders; maintaining internal bookkeeping, accounting and auditing
services and records; and supervising the provision of services to the
Portfolio by third parties. AMR also develops the investment program for the
Portfolio, selects and changes investment advisers (subject to approval by the
AMR Trust Board and appropriate interest holders), allocates assets among
investment advisers, monitors the investment advisers' investment programs and
results, and coordinates the investment activities of the

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<PAGE> 102
investment advisers to ensure compliance with regulatory restrictions.

AMR pays the fees of the investment advisers of the Portfolio.
As compensation for paying the investment advisory fees and for providing the
Portfolio with advisory and asset allocation services, AMR receives from AMR
Trust an annualized fee which is calculated and accrued daily, equal to the sum
of 0.10% of the net assets of the Portfolio, plus all fees payable by AMR to
the Portfolio Advisers.

AMR may enter into new or modified advisory agreements with
existing or new investment advisers without approval of International
Multi-Manager Stock Fund shareholders or Portfolio interest holders, but
subject to approval of the Board and the AMR Trust Board. The SEC issued an
exemptive order which eliminates the need for shareholder/interest holder
approval, subject to compliance with certain conditions.

The Advisory Agreement between the Portfolio and AMR will
continue in effect only if such continuance is specifically approved at least
annually by the Board of Trustees of the AMR Trust or by vote of the holders of
beneficial interest of the Portfolio, and in either case by a majority of the
Trustees of the AMR Trust who are not parties to the Advisory Agreement or
interested persons of any such party, at a meeting called for the purpose of
voting on the Advisory Agreement.

The Advisory Agreement with respect to the Portfolio is
terminable without penalty by the Portfolio on 60 days' written notice when
authorized either by vote of the Portfolio's shareholders or by a vote of a
majority of the Board of Trustees of the AMR Trust, or by AMR on not more than
60 days' nor less than 30 days' written notice, and will automatically
terminate in the event of its assignment. The Advisory Agreement also provides
that, with respect to the Portfolio, neither AMR nor its personnel shall be
liable for any error of judgment or mistake of law or for any act or omission
in the performance if its or their duties to the Portfolio, except for willful
misfeasance, bad faith or gross negligence in the performance of AMR's or their
duties or by reason of reckless disregard of its or their obligations and
duties under the Advisory Agreement. The Advisory Agreement provides that AMR
may render services to others.

The advisory fees are accrued daily and paid monthly. The
Adviser, in its sole discretion, may waive all or any portion of its advisory
fee with respect to the Portfolio.

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<PAGE> 103
Following is a description of the Portfolio Advisers, each of
which has been retained by AMR, on behalf of the Portfolio, to provide advisory
services to the Portfolio.

HOTCHKIS AND WILEY, 800 West Sixth Street, 5th Floor, Los Angeles,
California 90017, is a professional investment counseling firm which was
founded in 1980 by John F. Hotchkis and George Wiley. Hotchkis and Wiley is
now a division of Merrill Lynch Capital Management Group, a wholly-owned
subsidiary of Merrill Lynch & Co., Inc., who are the firm's founding General
Partners. Assets under management as of December 31, 1995 were approximately
$9.0 billion, which included approximately $988 million of assets of AMR and
its subsidiaries and affiliated entities. Hotchkis and Wiley also serves as an
investment adviser to the Balanced Portfolio and the Growth and Income
Portfolio of the AMR Trust. The advisory contract provides for AMR to pay
Hotchkis and Wiley an annualized fee equal to .60% of the first $10 million of
assets under its discretionary management, .50% of the next $140 million of
assets .30% on the next $50 million of assets, .20% of the next $800 million of
assets, and .15% of all excess AMR Trust assets managed by Hotchkis and Wiley.

MORGAN STANLEY ASSET MANAGEMENT INC. ("MSAM"), 1221 Avenue of the
Americas, New York, New York 10020, is a wholly owned subsidiary of Morgan
Stanley Group Inc. MSAM provides portfolio management and named fiduciary
services to taxable and nontaxable institutions, international organizations
and individuals investing in United States and international equity and debt
securities. As of September 30, 1995, MSAM had assets under management
totaling approximately $55.2 billion, including approximately $40.1 billion
under active management and $ 15.1 billion as named fiduciary or fiduciary
adviser. As of December 31, 1995, MSAM had investment authority over
approximately $404 million of assets of AMR and its subsidiaries and affiliated
entities. For its services, AMR pays MSAM an annual fee equal to 0.80% of the
first $25 million in AMR Trust assets under its discretionary management, 0.60%
of the next $25 million in assets, 0.50% of the next $24 million in assets and
0.40% on all excess assets.

ROWE PRICE-FLEMING INTERNATIONAL, INC. ("Fleming"), 100 East Pratt
Street, Baltimore, Maryland 21020, is a professional investment counseling firm
founded in 1979. Fleming is a joint venture owned entirely by its three parent
companies. T. Rowe Price, Robert Fleming and Jardine Fleming. As of December
31, 1995, Fleming had assets under management totaling approximately $22.2
billion, including approximately $ 197 million of assets of AMR and its
subsidiaries and affiliates entities. Fleming serves as an investment adviser
to the Portfolio, although AMR does not presently intend to allocate assets
from the Portfolio to

-38-
<PAGE> 104
Fleming. For its services to the Portfolio when total assets under Fleming's
management are less than $200 million, AMR will pay Fleming an annualized fee
equal to 0.75% of the first $20 million, 0.60% of the next $30 million and
0.50% on amounts over $50 million. When assets under Fleming's management
exceed $200 million but are less than $500 million, AMR will pay Fleming an
annualized fee equal to 0.50% on all assets. When assets under Fleming's
management exceed $500 million but are less than $750 million, AMR will pay an
annualized fee equal to 0.45% on all assets, and when assets exceed $750
million, AMR will pay Fleming a flat fee of 0.40% on all assets. When asset
levels are between $184 million and $200 million, Fleming will credit AMR with
an adjustment for the difference between the two fee schedules. The credit is
determined by pro-rating the difference between the original tiered fee and the
flat fee ($80,000 per annum at all asset levels) over the difference between
$200 million and the current asset size for billing purposes.

TEMPLETON INVESTMENT COUNSEL, INC. ("Templeton"), 500 East Broward
Blvd., Suite 2100, Fort Lauderdale, Florida 33394-3091, is a professional
investment counseling firm which has been providing investment services since
1979. Templeton is indirectly owned by Franklin Resources, Inc. As of December
31, 1995, Templeton had discretionary investment management authority with
respect to approximately $ 14.4 billion of assets, including approximately $288
million of assets of AMR and its subsidiaries and affiliated entities. For its
services, AMR pays Templeton an annualized fee equal to 0.50% of the first $
100 million in AMR Trust assets under its discretionary management, 0.35% of
the next $50 million in assets, 0.30% of the next $250 million in assets and
0.25% on assets over $400 million.

Distribution of Fund Shares

The Trust retains BISYS to serve as principal underwriter for
the shares of the Funds pursuant to a Distribution Contract. The Distribution
Contract provides that the Distributor will use its best efforts to maintain a
broad distribution of the Funds' shares among bona fide investors and may enter
into selling group agreements with responsible dealers and dealer managers as
well as sell the Funds' shares to

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<PAGE> 105
individual investors. The Distributor is not obligated to sell any specific
amount of shares.

Distribution Plan

The Trustees of the Fund have voted to adopt a Master
Distribution Plan (the "Plan") pursuant to Rule l2b-1 of the Investment Company
Act of 1940 (the "1940 Act") after having concluded that there is a reasonable
likelihood that the Plan will benefit the Fund and its shareholders. The Plan
provides for a monthly payment by the Fund to the Distributor in such amounts
that the Distributor may request or for direct payment by the Fund, for certain
costs incurred under the Plan, subject to periodic Board approval, provided
that each such payment is based on the average daily value of the Fund's net
assets during the preceding month and is calculated at an annual rate not to
exceed 0.25%. The Distributor will use all amounts received under the Plan for
payments to broker-dealers or financial institutions (but not including banks)
for their assistance in distributing shares of the Fund and otherwise promoting
the sale of Fund shares, including payments in amounts based on the average
daily value of Fund shares owned by shareholders in respect of which the
broker-dealer or financial institution has a distributing relationship. The
Distributor may also use all or any portion of such fees to pay Fund expenses
such as the printing and distribution of prospectuses sent to prospective
investors; the preparation, printing and distribution of sales literature and
expenses associated with media advertisements.

The Plan provides for the Distributor to prepare and submit to
the Board of Trustees on a quarterly basis written reports of all amounts
expended pursuant to the Plan and the purpose for which such expenditures were
made. The Plan provides that it may not be amended to increase materially the
costs which the Fund may bear pursuant to the Plan without shareholder approval
and that other material amendments of the Plan must be approved by the Board of
Trustees, and by the Trustees who neither are "interested persons" (as defined
in the 1940 Act) of the Trust nor have any direct or indirect financial
interest in the operation of the Plan or in any related agreement, by vote cast
in person at a meeting called for the purpose of considering such amendments.
The selection and nomination of the Trustees of the Trust has been committed to
the discretion of the Trustees who are not "interested persons" of the Trust.
The Plan and the related Administrative Services Contract between the Trust and
the Sponsor have been approved, and are subject to annual approval, by the
Board of Trustees and by the Trustees who neither are "interested persons" nor
have any direct or indirect

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<PAGE> 106
financial interest in the operation of the Plan or in the Administrative
Services Contract, by vote cast in person at a meeting called for the purpose
of voting on the Plan. The Board of Trustees and the Trustees who are not
"interested persons" and who have no direct or indirect financial interest in
the operation of the Plan or in the Administrative Services Contract voted to
approve the Plan at a meeting held on November 25, 1996. The Plan was
submitted to the shareholders of the Fund and approved at a special meeting
held on November 25, 1996. The Plan is terminable with respect to the Fund at
any time by a vote of a majority of the Trustees who are not "interested
persons" of the Trust and who have no direct or indirect financial interest in
the operation of the Plan or in the Administrative Services Contract or by vote
of the holders of a majority of the shares of the Fund.

Administrative Services

BISYS provides management and administrative services necessary for
the operation of the Funds, including, among other things: (i) preparation of
shareholder reports and communications; (ii) regulatory compliance, such as
reports to and filings with the SEC and state securities commissions; and (iii)
general supervision of the operation of the Funds, including coordination of
the services performed by the Adviser, the Distributor, transfer agent,
custodians, independent accountants, legal counsel and others. In addition,
BISYS furnishes office space and facilities required for conducting the
business of the Funds and pays the compensation of the Funds' officers,
employees and Trustees affiliated with BISYS. For these services, BISYS
receives from each Fund a fee, payable monthly, at the annual rate of 0.20%
(15% for International Multi-Manager Fund) of
each Fund's average daily net assets.

The Administrative Services Contract is for a one year term and is
subject to annual approval by a majority of the Trustees who are not
"interested persons" of the Trust and who have no direct or indirect financial
interest in the operation of the Administrative Services Contract. The
Administrative Services Contract will terminate automatically in the event of
its assignment.

Service Organizations

The Trust also contracts with banks (including the Adviser),
trust companies, broker-dealers (other than BISYS) or other financial
organizations ("Service Organizations") to provide certain administrative
services for the Funds. Services

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<PAGE> 107
provided by Service Organizations may include among other things: providing
necessary personnel and facilities to establish and maintain certain
shareholder accounts and records; assisting in processing purchase and
redemption transactions; arranging for the wiring of funds; transmitting and
receiving funds in connection with shareholders orders to purchase or redeem
shares; verifying and guaranteeing client signatures in connection with
redemption orders, transfers among and changes in shareholders designating
accounts; providing periodic statements showing a shareholder's account balance
and, to the extent practicable, integrating such information with other client
transactions; furnishing periodic and annual statements and confirmations of
all purchases and redemptions of shares in a shareholder's account;
transmitting proxy statements, annual reports, and updating prospectuses and
other communications from the Funds to shareholders; and providing such other
services as the Funds or a shareholder reasonably may request, to the extent
permitted by applicable statute, rule or regulation. Neither BISYS, nor the
Distributor will be a Service Organization or receive fees for servicing.
Service Organizations for Institution Premium Class shareholders may also
provide record keeping, communication with and education of shareholders,
fiduciary services (exclusive of investment management) and asset allocation
services.

Some Service Organizations may impose additional or different
conditions on their clients, such as requiring their clients to invest more
than the minimum initial or subsequent investments specified by the Funds or
charging a direct fee for servicing. If imposed, these fees would be in
addition to any amounts which might be paid to the Service Organization by the
Funds. Each Service Organization has agreed to transmit to its clients a
schedule of any such fees. Shareholders using Service Organizations are urged
to consult them regarding any such fees or conditions.

The Glass-Steagall Act and other applicable laws, among other
things, prohibit banks from engaging in the business of underwriting, selling
or distributing securities. There currently is no precedent prohibiting banks
from performing administrative and shareholder servicing functions as Service
Organizations. However, judicial or administrative decisions or
interpretations of such laws, as well as changes in either Federal or state
statutes or regulations relating to the permissible activities of banks and
their subsidiaries or affiliates, could prevent a bank from continuing to
perform all or a part of its servicing activities. In addition, state
securities laws on this issue may differ from the interpretations of federal
law expressed herein and banks and financial

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<PAGE> 108
institutions may be required to register as dealers pursuant to state law.

If a bank were prohibited from so acting, its shareholder
clients would be permitted to remain shareholders of the Trust and alternative
means for continuing the servicing of such shareholders would be sought. In
that event, changes in the operation of the Trust might occur and a shareholder
serviced by such a bank might no longer be able to avail itself of any services
then being provided by the bank. It is not expected that shareholders would
suffer any adverse financial consequences as a result of any of these
occurrences.

EXPENSES

Except for the expenses paid by INTRUST and BISYS, the Funds
bear all costs of their operations.

DETERMINATION OF NET ASSET VALUE

As indicated under "Fund Share Valuation" in the applicable
Prospectus, the Money Market Fund uses the amortized cost method to determine
the value of its portfolio securities pursuant to Rule 2a-7 under the 1940 Act.
The amortized cost method involves valuing a security at its cost and
amortizing any discount or premium over the period until maturity regardless of
the impact of fluctuating interest rates on the market value of the security.
While this method provides certainty in valuation, it may result in periods
during which the value, as determined by amortized cost, is higher or lower
than the price which the Fund would receive if the security were sold. During
these periods, the yield to a shareholder may differ somewhat from that which
could be obtained from a similar fund which utilizes a method of valuation
based upon market prices. Thus, during periods of declining interest rates, if
the use of the amortized cost method resulted in lower value of a Fund's
portfolio on a particular day, a prospective investor in the Fund would be able
to obtain a somewhat higher yield than would result from an investment in a
fund utilizing solely market values and existing Fund shareholders would
receive correspondingly less income. The converse would apply during periods
of rising interest rates.

Rule 2a-7 provides that in order to value its portfolio using
the amortized cost method, the Money Market Fund must maintain a
dollar-weighted average portfolio maturity of 90 days or less, purchase
securities having remaining maturities of 397

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<PAGE> 109
days or less and invest only in U.S. dollar denominated eligible securities
determined by the Trust's Board of Trustees to be of minimal credit risks and
which (1) have received the highest short-term rating by at least two
Nationally Recognized Statistical Rating Organizations ("NRSROs"), such as
"A-1" by Standard & Poor's and "P-1" by Moody's; (2) are single rated and have
received the highest short-term rating by a NRSRO; or (3) are unrated, but are
determined to be of comparable quality by the Adviser or the Adviser pursuant
to guidelines approved by the Board and subject to the ratification of the
Board.

In addition, the Fund will not invest more than 5% of its
total assets in the securities (including the securities collateralizing a
repurchase agreement) of, or subject to puts issued by, a single issuer, except
that, the Fund may invest in U.S. Government securities or repurchase
agreements that are collateralized by U.S. Government securities without any
such limitation, and the limitation with respect to puts does not apply to
unconditional puts if no more than 10% of a Fund's total assets are invested in
securities issued or guaranteed by the issuer of the unconditional put.
Investments in rated securities not rated in the highest category by at least
two rating organizations (or one rating organization if the instrument was
rated by only one such organization), and unrated securities not determined by
the Board of Trustees to be comparable to those rated in the highest rating
category, will be limited to 5% of a Fund's total assets, with investment in
any one such issuer being limited to no more than the greater of 1% of a Fund's
total assets or $1,000,000.

Pursuant to Rule 2a-7, the Board of Trustees is also required
to establish procedures designed to stabilize, to the extent reasonably
possible, the price per share of the Funds, as computed for the purpose of
sales and redemptions, at $1.00. Such procedures include review of the Fund's
portfolio holdings by the Board of Trustees, at such intervals as it may deem
appropriate, to determine whether the net asset value of the Funds calculated
by using available market quotations deviates from $l.00 per share based on
amortized cost. The extent of any deviation will be examined by the Board of
Trustees. If such deviation exceeds 1/2 of 1%, the Board of Trustees will
promptly consider what action, if any, will be initiated. In the event the
Board of Trustees determines that a deviation exists which may result in
material dilution or other unfair results to investors or existing
shareholders, the Board of Trustees will take such corrective action as it
regards as necessary and appropriate, which may include selling portfolio
instruments prior to maturity to realize capital gains or losses or to

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<PAGE> 110
shorten average portfolio maturity, withholding dividends or establishing a net
asset value per share by using available market quotations.

The Non-Money Market Funds value their portfolio securities in
accordance with the procedures described in the Prospectus.

PORTFOLIO TRANSACTIONS

Investment decisions for the Funds and the Portfolio and for
the other investment advisory clients of the Adviser and the Portfolio Advisers
are made with a view to achieving their respective investment objectives.
Investment decisions are the product of many factors in addition to basic
suitability for the particular client involved. Thus, a particular security
may be bought or sold for certain clients even though it could have been bought
or sold for other clients at the same time. Likewise, a particular security
may be bought for one or more clients when one or more clients are selling the
security. In some instances, one client may sell a particular security to
another client. It also sometimes happens that two or more clients
simultaneously purchase or sell the same security, in which event each day's
transactions in such security are, insofar as possible, averaged as to price
and allocated between such clients in a manner which in the opinion of the
Adviser and the Portfolio Advisers, is equitable to each and in accordance with
the amount being purchased or sold by each. There may be circumstances when
purchases or sales of portfolio securities for one or more clients will have an
adverse effect on other clients.

The Funds and the Portfolio have no obligation to deal with
any dealer or group of dealers in the execution of transactions in portfolio
securities. Subject to policies established by the Trust's Board of Trustees
and the AMR Trust Board, the Adviser and Portfolio Advisers, as appropriate,
are primarily responsible for portfolio decisions and the placing of portfolio
transactions. In placing orders, it is the policy of the Funds and the
Portfolio to obtain the best results taking into account the broker-dealer's
general execution and operational facilities, the type of transaction involved
and other factors such as the dealer's risk in positioning the securities.
While the Adviser and Portfolio Advisers generally seek reasonably competitive
spreads or commissions, the Funds will not necessarily be paying the lowest
spread or commission available.

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<PAGE> 111
Purchases and sales of securities will often be principal
transactions in the case of debt securities and equity securities traded
otherwise than on an exchange. The purchase or sale of equity securities will
frequently involve the payment of a commission to a broker-dealer who effects
the transaction on behalf of a Fund. Debt securities normally will be
purchased or sold from or to issuers directly or to dealers serving as market
makers for the securities at a net price. Generally, money market securities
are traded on a net basis and do not involve brokerage commissions.

The cost of executing portfolio securities transactions for
the Money Market Fund primarily consists of dealer spreads and underwriting
commissions. Under the 1940 Act, persons affiliated with the Funds or the
Sponsor are prohibited from dealing with the Funds as a principal in the
purchase and sale of securities unless a permissive order allowing such
transactions is obtained from the SEC.

The Adviser and Portfolio Advisers may, in circumstances in
which two or more broker-dealers are in a position to offer comparable results,
give preference to a dealer which has provided statistical or other research
services to the Adviser or Portfolio Advisers. By allocating transactions in
this manner, the Adviser and the Portfolio Advisers are able to supplement
their research and analysis with the views and information of securities firms.
These items, which in some cases may also be purchased for cash, include such
matters as general economic and securities market reviews, industry and company
reviews, evaluations of securities and recommendations as to the purchase and
sale of securities.

Some of these services are of value to the Adviser and
Portfolio Advisers in advising various of their clients (including the Funds),
although not all of these services are necessarily useful and of value in
managing the Funds. The management fees paid by the Funds and the Portfolio
are not reduced because the Adviser or Portfolio Advisers or their affiliates
receive such services.

As permitted by Section 28(e) of the Securities Exchange Act
of 1934 (the "Act"), the Adviser and Portfolio Advisers may cause the Funds to
pay a broker-dealer which provides "brokerage and research services" (as
defined in the Act) to the Adviser and Portfolio Advisers an amount of
disclosed commission for effecting a securities transaction for the Funds in
excess of the commission which another broker-dealer would have charged for
effecting that transaction.

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<PAGE> 112
Consistent with the Rules of Fair Practice of the National
Association of Securities Dealers, Inc. and subject to seeking the most
favorable price and execution available and such other policies as the Trustees
may determine, the Adviser and Portfolio Adviser may consider sales of shares
of the Funds as a factor in the selection of broker-dealers to execute
portfolio transactions for the Funds.

Portfolio Turnover

Changes may be made in the portfolio consistent with the
investment objectives and policies of the Funds whenever such changes are
believed to be in the best interests of the Funds and their shareholders. It
is anticipated that the annual portfolio turnover rate normally will not exceed
the amounts stated in the Funds' Prospectuses and financial statements. The
portfolio turnover rate is calculated by dividing the lesser of purchases or
sales of portfolio securities by the average monthly value of the Fund's
portfolio securities. For purposes of this calculation, portfolio securities
exclude all securities having a maturity when purchased of one year or less.

TAXATION

The Funds intend to qualify and elect annually to be treated
as regulated investment companies under Subchapter M of the Internal Revenue
Code of 1986, as amended (the "Code"). To qualify as a regulated investment
company, a Fund must (a) distribute to shareholders at least 90% of its
investment company taxable income (which includes, among other items,
dividends, taxable interest and the excess of net short-term capital gains over
net long-term capital losses); (b) derive in each taxable year at least 90% of
its gross income from dividends, interest, payments with respect to securities
loans and gains from the sale or other disposition of stock, securities or
foreign currencies or other income derived with respect to its business of
investing in such stock, securities or currencies; (c) derive less than 30% of
its gross income from the sale or other disposition of certain assets (namely,
(i) stock or securities; (ii) options, futures, and forward contracts (other
than those on foreign currencies), and (iii) foreign currencies (including
options, futures, and forward contracts on such currencies) not directly
related to the Fund's principal business of investing in stock or securities
(or options and futures with respect to stocks or securities)) held less than 3
months; and (d) diversify its holdings so that, at

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the end of each quarter of the taxable year, (i) at least 50% of the market
value of the Fund's assets is represented by cash and cash items (including
receivables), U.S. Government securities, the securities of other regulated
investment companies and other securities, with such other securities of any
one issuer limited for the purposes of this calculation to an amount not
greater than 5% of the value of the Fund's total assets and not greater than
10% of the outstanding voting securities of such issuer, and (ii) not more than
25% of the value of its total assets is invested in the securities of any one
issuer (other than U.S. Government securities or the securities of other
regulated investment companies). In addition, a Fund earning tax-exempt
interest must, in each year, distribute at least 90% of its net tax-exempt
income. By meeting these requirements, the Funds generally will not be subject
to Federal income tax on their investment company taxable income and net
capital gains which are distributed to shareholders. If the Funds do not meet
all of these Code requirements, they will be taxed as ordinary corporations and
their distributions will be taxed to shareholders as ordinary income.

TAXATION OF THE PORTFOLIO

The Portfolio has received a ruling from the IRS to the effect
that, among other things, the Portfolio is treated as a separate partnership for
federal income tax purposes and is not a "publicly traded partnership." As a
result, the Portfolio is not subject to federal income tax; instead, each
investor in the Portfolio, such as the International Multi-Manager Stock Fund
(the "Fund"), is required to take into account in determining its federal income
tax liability its share of the Portfolio's income, gains, losses, deductions,
credits and tax preference items, without regard to whether it has received any
cash distributions from the Portfolio.

The Fund will be deemed to own a proportionate share of the
Portfolio's assets and income for purposes of determining whether the Fund
satisfies the requirements to qualify as a Regulated Investment Company.
Accordingly, the Portfolio intends to conduct its operations so that its
corresponding Funds will be able to satisfy all those requirements.

Distributions to the Fund from the Portfolio (whether pursuant
to a partial or complete withdrawal or otherwise) will not result in the Fund's
recognition of any gain or loss for federal income tax purposes, except that
(1) gain will be recognized to the extent any cash that is distributed exceeds
the Fund's basis for its interest in the Portfolio before the

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distribution, (2) income or gain will be recognized if the distribution is in
liquidation of the Fund's entire interest in the Portfolio and includes a
disproportionate share of any unrealized receivables held by the Portfolio and
(3) loss will be recognized if a liquidation distribution consists solely of
cash and/or unrealized receivables. The Fund's basis for its interest in its
the Portfolio generally will equal the amount of cash and the basis of any
property the Fund invests in the Portfolio, increased by the Fund's share of
the Portfolio's net income and gains and decreased by (a) the amount of cash
and the basis of any property the Portfolio distributes to the Fund and (b) the
Fund's share of the Portfolio's losses.

Amounts, other than tax-exempt interest, not distributed on a timely
basis in accordance with a calendar year distribution requirement are subject
to a nondeductible 4% excise tax. To prevent imposition of the excise tax,
each Fund must distribute for each calendar year an amount equal to the sum of
(1) at least 98% of its ordinary income (excluding any capital gains or losses)
for the calendar year, (2) at least 98% of the excess of its capital gains over
capital losses (adjusted for certain ordinary losses) for the one-year period
ending October 31 of such year, and (3) all ordinary income and capital gains
net income (adjusted for certain ordinary losses) for previous years that were
not distributed during such years. A distribution, including an
"exempt-interest dividend," will be treated as paid on December 31 of a
calendar year if it is declared by a Fund during October, November or December
of that year to shareholders of record on a date in such a month and paid by
the Fund during January of the following year. Such distributions will be
taxable to shareholders in the calendar year in which the distributions are
declared, rather than the calendar year in which the distributions are
received.

Some Funds and the Portfolio may invest in stocks of foreign
companies that are classified under the Code as passive foreign investment
companies ("PFICs"). In general, a foreign company is classified as a PFIC under
the Code if at least one-half of its assets constitutes investment-type assets
or 75% or more of its gross income is investment-type income. Under the PFIC
rules, an "excess distribution" received with respect to PFIC stock is treated
as having been realized ratably over the period during which the Fund or the
Portfolio held the PFIC stock. A Fund itself will be subject to tax on the
portion, if any, of the excess distribution that is allocated to the Fund's or,
in the case of the International Multi-Manager Stock Fund, the Portfolio's
holding period in prior taxable years (and an interest factor will be added to
the tax, as if the tax had actually been payable in such prior taxable years)
and the International Multi-Manager Stock Fund will be taxed on its
proportionate
share of the Portfolio's excess distributions allocated to that even
though the Fund distributes the

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corresponding income to shareholders. Excess distributions include any gain
from the sale of PFIC stock as well as certain distributions from a PFIC. All
excess distributions are taxable as ordinary income.

A Fund or the Portfolio may be able to elect alternative tax
treatment with respect to PFIC stock. Under an election that currently may be
available, a Fund or the Portfolio generally would be required to include in
its gross income its share of the earnings of a PFIC on a current basis,
regardless of whether any distributions are received from the PFIC. If this
election is made, the special rules, discussed above, relating to the taxation
of excess distributions, would not apply. In addition, other elections may
become available that would affect the tax treatment of PFIC stock held by a
Fund. Each Fund's and the Portfolio's intention to qualify annually as a
regulated investment company may limit its elections with respect to PFIC
stock.

Because the application of the PFIC rules may affect, among
other things, the character of gains, the amount of gain or loss and the timing
of the recognition of income with respect to PFIC stock, as well as subject a
Fund itself or the Portfolio to tax on certain income from PFIC stock, the
amount that must be distributed to shareholders, and which will be taxed to
shareholders as ordinary income or long-term capital gain, may be increased or
decreased substantially as compared to a fund that did not invest in PFIC
stock. Investors should consult their own tax advisors in this regard. The
Portfolio does not intend to acquire stock of issuers that are considered
PFICs.

Distributions of investment company taxable income generally
are taxable to shareholders as ordinary income. Distributions from certain of
the Funds may be eligible for the dividends-received deduction available to
corporations. To the extent dividends received by a Fund are attributable to
foreign corporations, a corporation that owns shares will not be entitled to
the dividends-received deduction with respect to its pro rata portion of such
dividends, since the dividends-received deduction is generally available only
with respect to dividends paid by domestic corporations. Proposed legislation,
if enacted, would reduce the dividends received deduction from 70 to 50
percent.

Distributions of net long term capital gains, if any,
designated by the Funds as long term capital gain dividends are taxable to
shareholders as long-term capital gain, regardless of the length of time the
Funds' shares have been held by a shareholder. All distributions are taxable
to the shareholder in the same manner whether reinvested in additional shares
or

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received in cash. Shareholders will be notified annually as to the Federal tax
status of distributions.

Distributions by a Fund reduce the net asset value of the
Fund's shares. Should a distribution reduce the net asset value below a
shareholder's cost basis, such distribution, nevertheless, would be taxable to
the shareholder as ordinary income or capital gain as described above, even
though, from an investment standpoint, it may constitute a partial return of
capital. In particular, investors should be careful to consider the tax
implications of buying shares just prior to a distribution by the Funds. The
price of shares purchased at that time includes the amount of the forthcoming
distribution. Those purchasing just prior to a distribution will receive a
distribution which will nevertheless generally be taxable to them.

Upon the taxable disposition (including a sale or redemption)
of shares of a Fund, a shareholder may realize a gain or loss depending upon
his basis in his shares. Such gain or loss generally will be treated as
capital gain or loss if the shares are capital assets in the shareholders
hands. Such gain or loss will be long-term or short-term, generally depending
upon the shareholder's holding period for the shares. However, a loss realized
by a shareholder on the disposition of Fund shares with respect to which
capital gain dividends have been paid will, to the extent of such capital gain
dividends, be treated as long-term capital loss if such shares have been held
by the shareholder for six months or less. A loss realized on the redemption,
sale or exchange of Fund shares will be disallowed to the extent an
exempt-interest dividend was received with respect to those shares if the
shares have been held by the shareholder for six months or less. Further, a
loss realized on a disposition will be disallowed to the extent the shares
disposed of are replaced (whether by reinvestment of distributions or
otherwise) within a period of 61 days beginning 30 days before and ending 30
days after the shares are disposed of. In such a case, the basis of the shares
acquired will be adjusted to reflect the disallowed loss. Shareholders
receiving distributions in the form of additional shares will have a cost basis
for Federal income tax purposes in each share received equal to the net asset
value of a share of the Funds on the reinvestment date.

The taxation of equity options is governed by Code section
1234. Pursuant to Code section 1234, the premium received by a Fund for
selling a put or call option is not

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included in income at the time of receipt. If the option expires, the premium
is short-term capital gain to the Fund. If the Fund enters into a closing
transaction, the difference between the amount paid to close out its position
and the premium received is short-term capital gain or loss. If a call option
written by a Fund is exercised, thereby requiring the Fund to sell the
underlying security, the premium will increase the amount realized upon the
sale of such security and any resulting gain or loss will be a capital gain or
loss, and will be long-term or short-term depending upon the holding period of
the security. With respect to a put or call option that is purchased by a Fund,
if the option is sold, any resulting gain or loss will be a capital gain or
loss, and will be long-term or short-term, depending upon the holding period of
the option. If the option expires, the resulting loss is a capital loss and is
long-term or short-term, depending upon the holding period of the option. If
the option is exercised, the cost of the option, in the case of a call Option,
is added to the basis of the purchased security and, in the case of a put
option, reduces the amount realized on the underlying security in determining
gain or loss.

Certain of the options, futures contracts, and forward foreign
currency exchange contracts that several of the Funds and the Portfolio may
invest in are so-called "section 1256 contracts." With certain exceptions,
gains or losses on section 1256 contracts generally are considered 60% long-term
and 40% short-term capital gains or losses ("60/40"). Also, section 1256
contracts held by a Fund or the Portfolio at the end of each taxable year
(and, generally, for purposes of the 4% excise tax, on October 31 of each year)
are "marked-to-market" with the result that unrealized gains or losses are
treated as though they were realized and the resulting gain or loss is treated
as 60/40 gain or loss. Investors should contact their own tax advisors in this
regard.

Generally, the hedging transactions undertaken by a Fund
or the Portfolio may result in "straddles" for Federal income tax purposes. The
straddle rules may affect the character of gains (or losses) realized by a Fund
or the Portfolio. In addition, losses realized by a Fund or the Portfolio on a
position that are part of a straddle may be deferred under the straddle rules,
rather than being taken into account in calculating the taxable income for the
taxable year in which such losses are realized. Because only a few regulations
implementing the straddle rules have been promulgated, the tax consequences to a
Fund of hedging transactions are not entirely clear. Hedging transactions may
increase the amount of short-term capital gain realized by a Fund or the
Portfolio which is taxed as ordinary income when distributed to stockholders.

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A Fund or the Portfolio may make one or more of the elections
available under the Code which are applicable to straddles. If a Fund or the
Portfolio makes any of the elections, the amount, character and timing of the
recognition of gains or losses from the affected straddle positions will be
determined under rules that vary according to the election(s) made. The rules
applicable under certain of the elections may operate to accelerate the
recognition of gains or losses from the affected straddle positions.

Because application of the straddle rules may affect the
character of gains or losses, defer losses and/or accelerate the recognition of
gains or losses from the affected straddle positions, the amount which must be
distributed to shareholders, and which will be taxed to shareholders as
ordinary income or long-term capital gain, may be increased or decreased
substantially as compared to a fund that did not engage in such hedging
transactions. Investors should contact their own tax advisors in this regard.

Certain requirements that must be met under the Code in order
for a Fund to qualify as a regulated investment company may limit the extent to
which a Fund or, in the case of the International Multi-Manager Stock Fund, the
Portfolio, will be able to engage in transactions in options, futures, and
forward contracts.

Under the Code, gains or losses attributable to fluctuations
in exchange rates which occur between the time a Fund or the Portfolio accrues
interest, dividends or other receivables, or accrues expenses or other
liabilities denominated in a foreign currency, and the time the Fund or the
Portfolio actually collects such receivables, or pays such liabilities,
generally are treated as ordinary income or ordinary loss. Similarly, on
disposition of debt securities denominated in a foreign currency and on
disposition of certain options and forward and futures contracts, gains or
losses attributable to fluctuations in the value of foreign currency between the
date of acquisition of the security or contract and the date of disposition also
are treated as ordinary gain or loss. These gains or losses, referred to under
the Code as "section 988" gains or losses, may increase, decrease, or eliminate
the amount of a Fund's investment company taxable income to be distributed to
its shareholders as ordinary income. Investors should contact their own tax
advisors in this regard.

Income received by a Fund or the Portfolio from sources within
foreign countries may be subject to withholding and other similar income taxes
imposed by the foreign country. If more than 50% of the value of a Fund's total
assets at the close of its taxable year consists of securities of foreign
governments and corporations, the Fund will be eligible and intends to elect to
"pass-through"

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to its shareholders the amount of such foreign taxes paid by the Fund or, in the
case of the International Multi-Manager Stock Fund, its proportionate share of
such taxes paid by the Portfolio. Pursuant to this election, a shareholder would
be required to include in gross income (in addition to taxable dividends
actually received) his pro rata share of the foreign taxes paid (or deemed paid)
by a Fund, and would be entitled either to deduct his pro rata share of foreign
taxes in computing his taxable income or to use it as a foreign tax credit
against his U.S. Federal income tax liability, subject to limitations. No
deduction for foreign taxes may be claimed by a shareholder who does not itemize
deductions, but such a shareholder may be eligible to claim the foreign tax
credit (see below). Each shareholder will be notified within 60 days after the
close of a Fund's taxable year whether the foreign taxes paid by a Fund or the
Portfolio will "pass-through" for that year and, if so, such notification will
designate (a) the shareholder's portion of the foreign taxes paid to each such
country and (b) the portion of the dividend which represents income derived from
foreign sources.

Generally, a credit for foreign taxes is subject to the
limitation that it may not exceed the shareholder's U.S. tax attributable to
his total foreign source taxable income. For this purpose, if a Fund makes the
election described in the preceding paragraph, the source of the Fund's income
flows through to its shareholders. Gains from the sale of securities will be
treated as derived from U.S. sources and certain currency fluctuations gains,
including fluctuation gains from foreign currency-denominated debt securities,
receivables and payables, will be treated as ordinary income derived from U.S.
sources. The limitation on the foreign tax credit is applied separately to
foreign source passive income as defined for purposes of the foreign tax credit)
including foreign source passive income of a Fund (including, in the case of the
International Multi-Manager Stock Fund, its proportionate share of the
Portfolio's foreign source passive income). The foreign tax credit may offset
only 90% of the alternative minimum tax imposed on corporations and individuals,
and foreign taxes generally may not be deducted in computing alternative minimum
taxable income.

The Funds are required to report to the IRS all distributions
except in the case of certain exempt shareholders. All such distributions
generally are subject to withholding of Federal income tax at a rate of 31%
("backup withholding") in the case of non-exempt shareholders if (1) the
shareholder fails to furnish the Funds with and to certify the shareholder's
correct taxpayer identification number or social security number, (2) the IRS
notifies the Funds or a shareholder that the shareholder has failed to report
properly certain interest and dividend income to the IRS and to respond to
notices to that effect, or (3) when required to do so, the shareholder fails to
certify that he is not subject to backup withholding. If the withholding
provisions

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are applicable, any such distributions, whether reinvested in additional shares
or taken in cash, will be reduced by the amounts required to be withheld.
Backup withholding is not an additional tax. Any amount withheld may be
credited against the shareholders U.S. Federal income tax liability. Investors
may wish to consult their tax advisors about the applicability of the backup
withholding provisions.

The foregoing discussion relates only to Federal income tax
law as applicable to U.S. persons (i.e., U.S. citizens and residents and U.S.
corporations, partnerships, trusts and estates). Distributions by the Funds
also may be subject to state and local taxes and their treatment under state
and local income tax laws may differ from the Federal income tax treatment.
Distributions of a Fund which are derived from interest on obligations of the
U.S. Government and certain of its agencies and instrumentalities may be exempt
from state and local taxes in certain states. Shareholders should consult
their tax advisors with respect to particular questions of Federal, state and
local taxation. Shareholders who are not U.S. persons should consult their tax
advisers regarding U.S. and foreign tax consequences of ownership of shares of
the Funds including the likelihood that distributions to them would be subject
to withholding of U.S. tax at a rate of 30% (or at a lower rate under a tax
treaty).

Kansas Tax-Exempt Bond Fund. This Fund intends to manage its
portfolio so that it will be eligible to pay "exempt-interest dividends" to
shareholders. The Fund will so qualify if, at the close of each quarter of its
taxable year, at least 50% of the value of its total assets consists of state,
municipal, and certain other securities, the interest on which is exempt from
the regular Federal income tax. To the extent that the Fund's dividends
distributed to shareholders are derived from such interest income and are
designated as exempt-interest dividends by the Fund, they will be excludable
from a shareholder's gross income for Federal income tax purposes.
Exempt-interest dividends, however, must be taken into account by shareholders
in determining whether their total incomes are large enough to result in
taxation of up to 85% of their Social Security benefits and certain railroad
retirement benefits. The Fund will inform shareholders annually as to the
portion of the distributions from the Fund which constitute exempt-interest
dividends. In addition, for corporate shareholders of the Fund, exempt
interest dividends may comprise part or all of an adjustment to alternative
minimum taxable income. Exempt-interest dividends that are attributable to
certain private activity bonds, while not subject to the regular Federal

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income tax, may constitute an item of tax preference for purposes of the
alternative minimum tax.

To the extent that the Fund's dividends are derived from its
investment company taxable income (which includes interest on its temporary
taxable investments and the excess of net short-term capital gain over net
long-term capital loss), they are considered ordinary (taxable) income for
Federal income tax purposes. Such dividends will not qualify for the
dividends-received deduction for corporations. Distributions, if any, of net
long-term capital gains (the excess of net long-term capital gain over net
short-term capital loss) designated by a Fund as long-term capital gain
dividends are taxable to shareholders as long-term capital gain regardless of
the length of time the shareholder has owned shares of the Fund.

Upon redemption, sale or exchange of shares in this Fund, a
shareholder will realize a taxable gain or loss, depending on whether the gross
proceeds are more or less than the shareholder's tax basis for the shares. The
discussion above provides additional detail about the income tax consequences
of disposing of Fund shares.

Deductions for interest expense incurred to acquire or carry
shares of the Fund may be subject to limitations that reduce, defer, or
eliminate such deductions. This includes limitations on deducting interest on
indebtedness properly allocable to investment property (which may include
shares of the Fund). In addition, a shareholder may not deduct a portion of
interest on indebtedness incurred or continue to purchase or carry shares of an
investment company (such as this Fund) paying exempt-interest dividends. Such
disallowance would be in an amount which bears the same ratio to the total of
such interest as the exempt-interest dividends bear to the total dividends,
excluding net capital gain dividends received by the shareholder. Under rules
issued by the IRS for determining when borrowed funds are considered used for
the purposes of purchasing or carrying particular assets, the purchase of
shares may be considered to have been made with borrowed funds even though the
borrowed funds are not directly traceable to the purchase of shares.

Certain of the debt securities acquired by the Fund may be
treated as debt securities that were originally issued at a discount. Original
issue discount can generally be defined as the difference between the price at
which a security was issued and its stated redemption price at maturity.
Although no cash income is actually received by the Fund, original issue
discount on a taxable debt security earned in a given year generally is

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treated for Federal income tax purposes as interest and, therefore, such income
would be subject to the distribution requirements of the Code. Original issue
discount on an obligation, the interest from which is exempt from Federal
income tax, generally will constitute tax-exempt interest income.

Some of the debt securities may be purchased by the Fund at a
discount which exceeds the original issue discount on such securities, if any.
This additional discount represents market discount for Federal income tax
purposes. The gain realized on the disposition of any debt security having
market discount will be treated as ordinary taxable income to the extent it
does not exceed the accrued market discount on such debt security. Generally,
market discount accrues on a daily basis for each day the debt security is held
by the Fund at a constant rate over the time remaining to the debt security's
maturity or, at the election of the Fund, at a constant yield to maturity which
takes into account the semi-annual compounding of interest.

Under Kansas law, a mutual fund which qualifies as a regulated
investment company generally must have at least 50% of its total assets in
Kansas state and local issues at the end of each quarter of its taxable year in
order to be eligible to pay dividends which will be exempt from Kansas personal
income tax. Generally, shareholders who are Kansas residents will not incur
Kansas personal income tax on the amount of exempt-interest dividends received
by them from the Fund and derived from Kansas state and local issues, whether
taken in cash or paid in additional shares. Gain on the sale or redemption of
Fund shares is subject to Kansas personal income tax.

Shareholders will normally be subject to Kansas personal
income tax on dividends paid from income derived from taxable securities and
other taxable investments, and from securities issued by states other than
Kansas and on distribution of capital and other taxable gains.

The Fund will be required to report to the IRS all
distributions of investment company taxable income and net capital gains and
gross proceeds from the redemption or exchange of the Fund's shares, except in
the case of certain exempt shareholders. All such distributions and proceeds
from the redemption or exchange of the Fund's shares may be subject to
withholding of Federal income tax at the rate of 31% in the case of non-exempt
shareholders who fail to furnish a Fund with their taxpayer identification
numbers and with required certifications regarding their status under Federal
income tax laws.

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A deductible "environmental tax" of 0.12% is imposed on a
corporation's modified alternative minimum taxable income in excess of $2
million. The environmental tax will be imposed even if the corporation is not
required to pay an alternative minimum tax because the corporation's regular
income tax liability exceeds its minimum tax liability. To the extent that
exempt-interest dividends paid by a Fund are included in alternative minimum
taxable income, corporate shareholders may be subject to the environmental tax.

Opinions relating to the validity of municipal securities and
the exemption of interest thereon from Federal income tax are rendered by bond
counsel to the issuers. The Fund, the Adviser and its affiliates, and the
Funds' counsel make no review of proceedings relating to the issuance of state
or municipal securities on the bases of such opinions.

Persons who may be "substantial users" (or "related persons"
to substantial users) of facilities financed by private activity bonds should
consult their tax advisers before purchasing shares of this Fund since the
acquisition of shares of the Fund may result in adverse tax consequences to
them. In addition, all shareholders of a Fund should consult their tax
advisers about the tax consequences to them of their investments in the Fund.

Changes in the tax law, including provisions relating to
tax-exempt income, frequently come under consideration. If such changes are
enacted, the tax consequences arising from an investment in Kansas Tax-Exempt
Bond Fund may be affected. Since the Trust does not undertake to furnish tax
advice, it is important for shareholders to consult their tax advisers
regularly about the tax consequences to them of investing in one or more of the
INTRUST Funds.

OTHER INFORMATION

Capitalization

The Trust is a Delaware business trust established under a
Declaration of Trust dated January 26, 1996 and currently consists of six
separately managed portfolios. Each portfolio is comprised of two classes of
shares -- the "Institutional Service Class" and the "Institutional Premium
Class." The two classes are identical with the exception that the shareholders
in the Institutional Premium Class may pay additional Service Organization fees
in an amount up to 0.50% of the daily net asset

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value of the Fund's shares owned by shareholders with whom the Service
Organization has a servicing relationship for record keeping, communications
with and education of shareholders, fiduciary services (excluding investment
management) and asset allocation services. The capitalization of the Trust
consists solely of an unlimited number of shares of beneficial interest with a
par value of $0.001 each. The Board of Trustees may establish additional Funds
(with different investment objectives and fundamental policies) at any time in
the future. Establishment and offering of additional Funds will not alter the
rights of the Trust's shareholders. When issued, shares are fully paid,
non-assessable, redeemable and freely transferable. Shares do not have
preemptive rights or subscription rights. In any liquidation of a Fund, each
shareholder is entitled to receive his pro rata share of the net assets of that
Fund.

Expenses incurred in connection with each Fund's organization
and the public offering of its shares have been deferred and are being
amortized on a straight-line basis over a period of not more than five years.

Voting Rights

Under the Declaration of Trust, the Trust is not required to
hold annual meetings of each Fund's shareholders to elect Trustees or for other
purposes. When certain matters affect only one class of shares but not
another, the shareholders would vote as a class regarding such matters. It is
not anticipated that the Trust will hold shareholders' meetings unless required
by law or the Declaration of Trust. In this regard, the Trust will be required
to hold a meeting to elect Trustees to fill any existing vacancies on the Board
if, at any time, fewer than a majority of the Trustees have been elected by the
shareholders of the Trust. In addition, the Declaration of Trust provides that
the holders of not less than two-thirds of the outstanding shares of the Trust
may remove persons serving as Trustee either by declaration in writing or at a
meeting called for such purpose. The Trustees are required to call a meeting
for the purpose of considering the removal of persons serving as Trustee if
requested in writing to do so by the holders of not less than 10% of the
outstanding shares of the Trust. To the extent required by applicable law, the
Trustees shall assist shareholders who seek to remove any person serving as
Trustee.

The Trust's shares do not have cumulative voting rights, so
that the holders of more than 50% of the outstanding shares may elect the
entire Board of Trustees, in which case the

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holders of the remaining shares would not be able to elect any Trustees.

Custodian Transfer Agent and Dividend Disbursing Agent

INTRUST acts as custodian of the Trust's assets. An
affiliate of BISYS acts as transfer agent for the Funds. The Trust compensates
BISYS for providing personnel and facilities to perform transfer agency related
services for the Trust at a rate intended to represent the cost of providing
such services. The International Multi-Manager Stock Fund pays no custodian
fees as long as all of its assets are invested in another mutual fund, but
incurs its pro-rata portion of the custody fees of Chase Manhattan Bank, N.A. as
Portfolio Custodian. The AMR Trust Board has reviewed and approved custodial
arrangements for securities held outside of the United States in accordance with
Rule 17f-5 of the 1940 Act.

Experts

KPMG Peat Marwick LLP has been selected as the independent
accountants for the Trust. KPMG Peat Marwick LLP provides audit services, tax
return preparation and assistance and consultation in connection with certain
SEC filings. KPMG Peat Marwick LLP is located at Nationwide Plaza, Columbus,
Ohio, 43215.

Yield and Performance Information

The Funds may, from time to time, include their yield,
effective yield, tax equivalent yield and average annual total return in
advertisements or reports to shareholders or prospective investors.

Current yield for the Money Market Fund will be based on the
change in the value of a hypothetical investment (exclusive of capital changes
such as gains or losses from the sale of securities and unrealized appreciation
and depreciation) over a particular seven-day period, less a pro-rata share of
each Fund's expenses accrued over that period (the "base period"), and stated
as a percentage of the investment at the start of the base period (the "base
period return"). The base period return is then annualized by multiplying by
365/7, with the resulting yield figure carried to at least the nearest
hundredth of one percent. "Effective yield" for the Money Market Fund assumes
that all dividends received during the base period have been reinvested.
Calculation of "effective yield" begins with the same "base period return" used
in the calculation of yield, which is then

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<PAGE> 126
annualized to reflect weekly compounding pursuant to the following formula:

365/7
Effective Yield = [(Base Period Return + 1) ] - 1.

Quotations of yield for the Non-Money Market Fund will be
based on the investment income per share earned during a particular 30-day
period, less expenses accrued during a period ("net investment income") and
will be computed by dividing net investment income by the maximum offering
price per share on the last day of the period, according to the following
formula:

6
YIELD = 2[(a-b + 1) -l]
---
cd

where a = dividends and interest earned during the period, b = expenses accrued
for the period (net of any reimbursements), c = the average daily number of
shares outstanding during the period that were entitled to receive dividends,
and d = the maximum offering price per share on the last day of the period.

Quotations of tax-equivalent yield for the Kansas Tax-Exempt
Bond Fund will be calculated according to the following formula:

TAX EQUIVALENT YIELD = ( E )
---
1-p

E = tax-exempt yield
p = stated income tax rate

Quotations of average annual total return will be
expressed in terms of the average annual compounded rate of return of a
hypothetical investment in a Fund over periods of 1, 5 and 10 years and since
inception (up to the life of the Fund), calculated pursuant to the following
formula:
n
P (1 + T) = ERV

(where P = a hypothetical initial payment of $l,000, T = the average annual
total return, n = the number of years, and ERV = the ending redeemable value of
a hypothetical $1,000 payment made at the beginning of the period). All total
return figures will reflect the deduction of the maximum sales charge and a
proportional share of Fund expenses (net of certain reimbursed

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<PAGE> 127
expenses) on an annual basis, and will assume that all dividends and
distributions are reinvested when paid.

Quotations of yield and total return will reflect only the
performance of a hypothetical investment in the Funds during the particular
time period shown. Yield and total return for the Funds will vary based on
changes in the market conditions and the level of the Fund's expenses, and no
reported performance figure should be considered an indication of performance
which may be expected in the future.

In connection with communicating its yields or total return to
current or prospective unit holders, the Funds also may compare these figures
to the performance of other mutual funds tracked by mutual fund rating services
or to other unmanaged indexed which may assume reinvestment of dividends but
generally do not reflect deductions for administrative and management costs.

Performance information for the Funds may be compared, in
reports and promotional literature, to: (i) the Standard & Poor's 500 Stock
Index, Dow Jones Industrial Average, or other unmanaged indices so that
investors may compare the Funds' results with those of a group of unmanaged
securities widely regarded by investors as representative of the securities
markets in general; (ii) other groups of mutual funds tracked by Lipper
Analytical Services, a widely used independent research firm which ranks mutual
funds by overall performance, investment objectives, and assets, or tracked by
other services, companies, publications, or persons who rank mutual funds on
overall performance or other criteria; and (iii) the Consumer Price Index
(measure for inflation) to assess the real rate of return from an investment of
dividends but generally do not reflect deductions for administrative and
management costs and expenses.

Investors who purchase and redeem shares of the Funds through
a customer account maintained at a Service Organization may be charged one or
more of the following types of fees as agreed upon by the Service Organization
and the investor, with respect to the customer services provided by the Service
Organization: account fees (a fixed amount per month or per year); transaction
fees (a fixed amount per transaction processed); compensating balance
requirements (a minimum dollar amount a customer must maintain in order to
obtain the services offered); or account maintenance fees (a periodic charge
based upon a percentage of the assets in the account or of the dividends paid
on those assets). Such fees will have the effect of reducing the yield and
average annual total return of the Funds for those investors. Investors who
maintain accounts with the Trust as transfer agent will not pay these fees.

Financial Statements

-62-

<PAGE> 128
INTRUST FUNDS TRUST
Money Market Fund
Statement of Assets and Liabilities
As of December 6, 1996

<TABLE>
<S> <C>
ASSETS:
Cash $100,000
Deferred organization expenses 30,000
--------
Total Assets 130,000

LIABILITIES:
Accrued organization expenses 30,000
--------

NET ASSETS: $100,000
========

NET ASSETS CONSIST OF:
Capital - 100,000 shares of
beneficial interest issued and
outstanding; unlimited shares
authorized (par value $0.001) -
Institutional Service Class $100,000
========

NET ASSET VALUE:
Institutional Service Shares
($100,000/100,000 shares issued
and outstanding) - offering and
redemption price per share $1.00
========
</TABLE>

See notes to financial statements.
<PAGE> 129
INTRUST FUNDS TRUST
Money Market Fund
NOTES TO FINANCIAL STATEMENTS
December 6, 1996

1. ORGANIZATION

INTRUST Funds Trust (the "Company"), an open-end management investment
company established as a Delaware business trust, is registered under
the Investment Company Act of 1940 (the "1940 Act"). The Company offers
shares of the following funds: Money Market Fund, Short-Term Bond Fund,
Intermediate Bond Fund, Stock Fund, Kansas Tax-Exempt Bond Fund and
International Multi-Manager Stock Fund each of which offers
Institutional Service Shares and Institutional Premium Shares. Both
classes of shares have identical rights and privileges except with
respect to Service Organization fees and voting rights on matters
affecting a single class of shares. The accompanying financial statement
relates only to the Money Market Fund (the "Fund"). The Fund had no
operations other than those actions relating to organizational matters.
As of December 6, 1996, all outstanding shares of the Fund are owned by
BISYS Fund Services, Ohio, Inc.

The investment objective of the Fund is to seek to provide investors
with current income, liquidity and the maintenance of a stable net asset
value of $1.00 per share by investing in high quality, short-term
obligations.

2. ORGANIZATION EXPENSES

All costs incurred by the Company in connection with the organization of
the Fund and the initial public offering of shares of the Fund,
principally professional fees and printing, have been deferred. Upon
commencement of operations of the Fund, the deferred organization
expenses will be amortized on a straight-line basis over a period of
five years. In the event that any of the initial shares of the Fund are
redeemed during the amortization period by any holder thereof, the
redemption proceeds will be reduced by any unamortized organization
expenses in the same proportion as the number of said shares being
redeemed bears to the number of initial shares that are outstanding at
the time of the redemption.

3. RELATED PARTY TRANSACTIONS

INTRUST Bank, N.A. ("Intrust") serves as the Company's Investment
Advisor. Under an advisory agreement with the Company, Intrust is
entitled to receive fees at an annualized rate of 0.25% of the Fund's
average daily net assets. AMR Investment Services, Inc. serves as
investment sub-adviser to the Fund. BISYS
<PAGE> 130
Fund Services ("BISYS") serves the Funds as Administrator and Sponsor.
For its services as Administrator, BISYS receives a fee at an amount of
0.20% of the Fund's average daily net assets. BISYS also serves as
Distributor for the Fund's shares.

Various banks, trust companies, broker-dealers (other than the Sponsor)
or other financial organizations (collectively, "Service Organizations")
may provide administrative services for the Fund, such as maintaining
shareholder accounts and records. The Fund may pay fees to Service
Organizations in amounts up to an annual rate of 0.05% of the daily net
asset value of the Fund's shares owned by shareholders with whom the
Service Organization has a servicing relationship. The Institutional
Premium Class may pay fees to Service Organizations in amounts up to an
annual rate of 0.50% of the daily net asset value of the Fund's shares
owned by shareholders with whom the Service Organization has a servicing
relationship.

Certain officers of the Company are affiliated with BISYS. Such persons
are not paid directly by the Company for serving in those capacities.

4. ESTIMATES

The preparation of this financial statement requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statement.
<PAGE> 131

INTRUST FUNDS TRUST
Money Market Fund
Statement of Assets and Liabilities
As of December 6, 1996

<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Cash $100,000
Deferred organization expenses 30,000
--------

Total Assets 130,000

LIABILITIES:
Accrued organization expenses 30,000
--------

NET ASSETS: $100,000
========

NET ASSETS CONSIST OF:
Capital - 100,000 shares of
beneficial interest issued and
outstanding; unlimited shares
authorized (par value $0.001) -
Institutional Service Class $100,000
========

NET ASSET VALUE:
Institutional Service Shares
($100,000/100,000 shares issued
and outstanding) - offering and
redemption price per share $ 1.00
========
</TABLE>

See notes to financial statements.