LIBERTY STEIN ROE ADVISOR TRUST, 485APOS, 1999-08-10

LIBERTY STEIN ROE ADVISOR TRUST
485APOS, 1999-08-10

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1933 Act Registration No. 333-17255
1940 Act File No. 811-07955

SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Post-Effective Amendment No. 11 [X]

and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 13 [X]

LIBERTY-STEIN ROE ADVISOR TRUST
(Exact Name of Registrant as Specified in Charter)

One South Wacker Drive, Chicago, Illinois 60606
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: 1-800-338-2550

Heidi J. Walter Cameron S. Avery
Vice-President & Secretary Bell, Boyd & Lloyd
Liberty-Stein Roe Advisor Trust Three First National Plaza
One South Wacker Drive 70 W. Madison Street, Suite 3300
Chicago, Illinois 60606 Chicago, Illinois 60602
(Name and Address of Agents for Service)

It is proposed that this filing will become effective (check
appropriate box):

[ ] immediately upon filing pursuant to paragraph (b)
[ ] on (date) pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[X] on October 29, 1999 pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) pursuant to paragraph (a)(2) of rule 485

Registrant has previously elected to register under the Securities
Act of 1933 an indefinite number of its shares of beneficial
interest, without par value, of the series of shares designated
Stein Roe Advisor Growth & Income Fund, Stein Roe Advisor Young
Investor Fund, Stein Roe Advisor Growth Stock Fund, Stein Roe
Advisor Special Fund, Stein Roe Advisor High-Yield Municipals
Fund, Stein Roe Advisor Intermediate Bond Fund, and Stein Roe
Internet Leaders Fund.

<PAGE>

The prospectuses and statements of additional information
relating to the series of Liberty-Stein Roe Advisor Trust
designated Stein Roe Advisor Growth & Income Fund, Stein Roe
Advisor Young Investor Fund, Stein Roe Advisor Growth Stock
Fund, Stein Roe Advisor Special Fund, Stein Roe Advisor
Intermediate Bond Fund, and Stein Roe Advisor High-Yield
Municipals Fund are not affected by the filing of this Post-
Effective Amendment No. 11.

PRELIMINARY PROSPECTUS DATED AUGUST 10, 1999

The information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these
securities and is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.

Stein Roe Internet Leaders Fund

Prospectus
________, 1999

The Securities and Exchange Commission has not approved or
disapproved these securities or determined whether this prospectus
is truthful or complete. Anyone who tells you otherwise is
committing a crime.

The Fund
Investment Goal
Principal Investment Strategy
Principal Investment Risks
Your Expenses

Your Account
Purchasing Shares
Opening an Account
Determining Share Price (NAV)
Selling Shares
Exchanging Shares
Dividends and Distributions

Other Investments and Risks
Short Sales
Futures
Options
Portfolio Turnover
Temporary Defensive Positions
Interfund Lending Program

The Fund's Management
Investment Adviser
Portfolio Managers
Master/Feeder Structure
Year 2000 Readiness

Please keep this prospectus as your reference manual.

THE FUND

INVESTMENT GOAL Stein Roe Internet Leaders Fund seeks long-term
growth.

PRINCIPAL INVESTMENT STRATEGY Under normal market circumstances,
the Fund invests at least 65% of its assets in companies of any
size that are Internet Sector Companies. Internet Sector
Companies include companies involved in the development, design
and distribution of products and services which form the
infrastructure of the Internet. Internet Sector Companies also
include companies experiencing incremental growth due to business
that is conducted over the Internet.

In selecting investments for the portfolio, the Fund's managers
target established companies, emerging companies and start-up
companies. The portfolio managers consider an established company
to be one that has a significant share of a well-established
market, a stable operating model, and products or services that
are considered an industry standard. The portfolio managers
consider emerging companies to be companies that are past the
start-up phase of development, have established some scale and
internal infrastructure, are in the early stages of profitability
and are one of a few companies competing to provide products or
services that have the potential to become an industry standard.
The portfolio managers consider start-up companies to be companies
that exhibit the potential for rapid growth in markets that are in
the early stages of development. Start-up companies generally
either have many competitors, but have limited market share or
operate in markets which are not fully established.

The portfolio managers may decide to sell a holding if that
holding reaches the portfolio managers' price target or if there
has been some change in a company's fundamentals of the market the
company participates in.

PRINCIPAL INVESTMENT RISKS There are two basic risks for all
mutual funds that invest in stocks: management risk and market
risk. These risks may cause you to lose money when you sell your
shares.

[Callout]
WHAT ARE MARKET AND MANAGEMENT RISKS?
Management risk means that stock selections and other investment
decisions might produce losses or cause the Fund to underperform
when compared to other funds with similar goals. Market risk
means that security prices in a market, sector or industry may
move down. Downward movements will reduce the value of your
investment. Because of management and market risk, there is no
guarantee that the Fund will achieve its investment goal or
perform favorably compared with competing funds.
[End of callout]

Sector Concentration

The Fund has no restrictions to diversify across industry sectors.
Given the nature of the Fund's principal investment strategy, the
Fund will likely concentrate a significant portion of its assets
in the technology sector and may concentrate in other sectors.
When a Fund concentrates in sectors, particularly the technology
sector, the Fund is subject to certain risks. Concentrating
investments in a limited number of industry sectors could result
in the Fund experiencing larger price fluctuations than funds that
invest in a wide range of industry sectors. Fund performance will
largely depend upon the performance of the industry sectors in
which the Fund concentrates, which may differ in direction and
degree from that of the overall stock market. Financial,
economic, business, political, and other developments affecting
those sectors will have a greater effect on the Fund. The value
of technology-related companies is particularly vulnerable to
rapidly changing technology, extensive government regulation, and
relatively high costs of obsolescence caused by technological
advances, which are higher than in other industry sectors.

Start-Up and Other Small Companies

Investments in stocks of start-up and other small companies can be
riskier than investments in larger companies. Start-up and other
small companies often have less-experienced management, limited
product lines, unproven track records, or financial reserves.
Start-up and other small companies are more likely to fail or
prove unable to grow. Their securities may trade less frequently,
in smaller volumes, and fluctuate more sharply in price than large
companies. In addition, start-up and other small companies may
not be widely followed by the investment community, which can
lower the demand for their stock.

An investment in the Fund is not a bank deposit and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. It is not a complete investment program
and you can lose money by investing in the Fund.

For more information on the Fund's investment techniques, please
refer to "Other Investments and Risks."

Who Should Invest in the Fund?

You may want to invest in the Fund if you:
* want a mutual fund that invests in stocks of Internet Sector
Companies as we have defined above
* want the performance potential of a sector fund and are
comfortable with the increased price volatility that may
accompany sector investing
* are a long-term investor

The Fund is not appropriate for investors who:
* can't tolerate the greater price volatility associated with a
sector fund

* are saving for a short-term investment
* need regular current income

YOUR EXPENSES This table shows fees and expenses you may pay if
you buy and hold shares of the Fund. You do not pay any sales
charge when you purchase or sell your shares.(a) However, you pay
various other indirect expenses because the Fund pays fees and
other expenses that reduce your investment return.

SHAREHOLDER FEES(a)
(expenses that are deducted from your account)
- -------------------------------------------------------------
Redemption fee (as a percentage of amount redeemed)....1.00%
ANNUAL FUND OPERATING EXPENSES
(expenses that are deducted from Fund assets)
Management fees(b).....................................0.90%
Distribution 12b-1 fees................................0.25%
Other expenses(c)......................................
Total annual fund operating expenses (d)...............
Less expense reimbursement.............................1.50%
Net expenses...........................................

(a) A 1% redemption fee, retained by the Fund, is imposed only on
redemptions of Fund shares held less than 90 days. There is a
$7 charge for wiring redemption proceeds to your bank. A fee
of $5 per quarter may be charged to accounts that fall below
the required minimum balance.
(b) Management fees include both the management fee and the
administrative fee charged to the Fund.
(c) Other Expenses are based on projected average annual assets of
$50 million. Fund expenses include 12b-1 fees, management
fees, and administrative costs such as furnishing the Fund
with offices and providing tax and compliance services.
(d) Stein Roe will reimburse the Fund if its annual ordinary
operating expenses exceed 1.50% of average daily net assets.
This commitment expires on Jan. 31, 2000. After
reimbursement, management fees will be ___%. A reimbursement
lowers the expense ratio and increases overall return to
investors.

Expense Example

This example compares the cost of investing in the Fund to the
cost of investing in a similar mutual fund. It uses the same
hypothetical assumptions that other funds use in their
prospectuses:

* $10,000 initial investment
* 5% total return each year
* the Fund's operating expenses remain constant as a percent of
net assets
* redemption at the end of each time period

Your actual costs may be higher or lower because in reality fund
returns and operating expenses change. Expenses based on these
assumptions are:

EXPENSE EXAMPLE
1 yr 3 yrs
Internet Leaders Fund $109 $340

YOUR ACCOUNT

PURCHASING SHARES You may purchase shares of the Fund without a
sales charge. Your purchases are made at NAV next determined
after the Fund receives your check, wire transfer or electronic
transfer. If the Fund receives your check, wire transfer or
electronic transfer after the close of regular trading on the New
York Stock Exchange (NYSE)-normally 3 p.m. Central time-your
purchase is effective on the next business day. If you
participate in the Stein Roe CounselorSM program or are a client
of Stein Roe Private Capital Management, the minimum initial
investment is determined by those programs.

Purchases through Third Parties

If you purchase Fund shares through certain broker-dealers, banks
or other intermediaries (intermediaries), they may charge a fee
for their services. They may also place limits on your ability to
use services the Fund offers. There are no charges or limitations
if you purchase shares directly from the Fund, except those fees
described in this prospectus.

If an intermediary is an agent or designee of the Fund, orders are
processed at the NAV next calculated after the intermediary
receives the order. The intermediary must segregate any orders it
receives after the close of regular trading on the NYSE and
transmit those orders separately for execution at the NAV next
determined.

Conditions of Purchase

An order to purchase Fund shares is not binding unless and until
an authorized officer, agent or designee of the Fund accepts and
enters it on the Fund's books. Once we accept your purchase
order, you may not cancel or revoke it; however, you may redeem
your shares. The Fund may reject any purchase order if it
determines that the order is not in the best interests of the Fund
and its shareholders. The Fund may waive or lower its investment
minimums for any reason.

ACCOUNT MINIMUMS
Minimum to Minimum Minimum
Type of Account Open an Account Addition Balance
- -------------------------------------------------------------
Regular $2,500 $100 $1,000
Custodial (UGMA/UTMA) 1,000 100 1,000
Automatic Investment Plan 100 50 --
Roth and Traditional IRA 500 50 500
Educational IRA 500 50* 500
*Maximum $500 contribution per calendar year per child.

Opening an Account

OPENING OR ADDING TO AN ACCOUNT
BY MAIL: Opening an Account
Complete the application.
Make check payable to Stein Roe Mutual Funds.

Mail application and check to:
SteinRoe Services Inc.
P.O. Box 8900
Boston, MA 02205

Adding to an Account
Make check payable to Stein Roe Mutual Funds. Be sure
to write your account number on the check.

Fill out investment slip (stub from your statement or
confirmation) or include a note indicating the amount of
your purchase, your account number, and the name in
which your account is registered.

Mail check with investment slip or note to the address
above.

BY WIRE: Opening an Account
Mail your application to the address listed on the left,
then call 800-338-2550 to obtain an account number.
Include your Social Security Number. To wire funds, use
the instructions below.

Adding to an Account
Wire funds to:
First National Bank of Boston
ABA: 011000390
Attn.: SSI, Account No. 560-99696
Fund No. __; Stein Roe Internet Leaders Fund
Your name (exactly as in the registration).
Fund account number.

BY ELECTRONIC FUNDS TRANSFER:
Opening an Account
You cannot open a new account via electronic transfer.

Adding to an Account
Call 800-338-2550 to make your purchase. To set up
prescheduled purchases, be sure to elect the Automatic
Investment Plan (Stein Roe Asset [service mark] Builder)
option on your application.

BY EXCHANGE:
Opening an Account
By mail, phone, in person or automatically (be sure to
elect the Automatic Exchange Privilege on your
application).

Adding to an Account
By mail, phone, in person or automatically (be sure to
elect the Automatic Exchange Privilege on your
application).

THROUGH AN INTERMEDIARY:
Opening an Account
Contact your financial professional.

Adding to an Account
Contact your financial professional.

All checks must be made payable in U.S. dollars and drawn on U.S.
banks. Money orders and third-party checks will not be accepted.

DETERMINING SHARE PRICE The Fund's share price is its NAV next
determined. NAV is the difference between the values of the
Fund's assets and liabilities divided by the number of shares
outstanding. We determine NAV at the close of regular trading on

the NYSE-normally 3 p.m. Central time. If you place an order
after that time, you receive the share price determined on the
next business day.

To calculate NAV on a given day, we value each stock listed or
traded on a stock exchange at its latest sale price on that day.
If there are no sales that day, we value the security at the most
recently quoted bid price. We value each over-the-counter
security or National Association of Securities Dealers Automated
Quotation (Nasdaq) security as of the last sale price for that
day. We value all other over-the-counter securities that have
reliable quotes at the latest quoted bid price.

We value long-term debt obligations and securities convertible
into common stock at fair value. Pricing services provide the
Fund with the value of the securities. When the price of a
security is not available, including days when we determine that
the sale or bid price of the security does not reflect that
security's market value, we value the security at a fair value
determined in good faith under procedures established by the Board
of Trustees.

We value a security at fair value when events have occurred after
the last available market price and before the close of the NYSE
that materially affect the security's price. In the case of
foreign securities, this could include events occurring after the
close of the foreign market and before the close of the NYSE. The
Fund's foreign securities may trade on days when the NYSE is
closed. We will not price shares on days that the NYSE is closed
for trading. You will not be able to purchase or redeem shares
until the next NYSE-trading day.

SELLING SHARES You may sell your shares any day the Fund is open
for business. Please follow the instructions below.

SELLING SHARES
By Mail: Send a letter of instruction, in English, including
your account number and the dollar value or number of
shares you wish to sell. Sign the request exactly as
the account is registered. Be sure to include a
signature guarantee. All supporting legal documents as
required from executors, trustees, administrators, or
others acting on accounts not registered in their
names, must accompany the request. We will mail the
check to your registered address.

By Phone: This feature is automatically added to your account
unless you decline it on your application. Call 800-
338-2550 to redeem an amount of $1,000 or more. We
will mail the check to your registered address.

By Wire: Fill out the appropriate areas of the account
application for this feature. Proceeds of $1,000 or
more ($100,000 maximum) may be wired to your
predesignated bank account. Call 800-338-2550 to give
instructions to Stein Roe. There is a $7 charge for
wiring redemption proceeds to your bank.

By Electronic Transfer: Fill out the appropriate areas of the
account application for this feature. To request an
electronic transfer (not less than $50; not more than
$100,000), call 800-338-2550. We will transfer your
sale proceeds electronically to your bank. The bank
must be a member of the Automated Clearing House.

By Exchange: Call 800-338-2550 to exchange any portion of your
Fund shares for shares in any other Stein Roe no-load
fund.

By Automatic Exchange: Fill out the appropriate areas of the
account application for this feature. Redeem a fixed
amount on a regular basis (not less than $50 per month;
not more than $100,000) from the Fund for investment in
another Stein Roe no-load fund.

What You Need to Know When Selling Shares

Once we receive and accept your order to sell shares, you may not
cancel or revoke it. We cannot accept an order to sell that
specifies a particular date or price or any other special
conditions. If you have any questions about the requirements for
selling your shares, please call 800-338-2550 before submitting
your order.

The Fund redeems shares at the NAV next determined after an order
has been accepted. We mail the proceeds within seven days after
the sale. The Fund normally pays wire redemption or electronic
transfer proceeds on the next business day.

We will not pay sale proceeds until your shares are paid for. If
you attempt to sell shares purchased by check or electronic
transfer within 15 days of the purchase date, we will delay
sending the sale proceeds until we can verify that those shares
are paid for. You may avoid this delay by purchasing shares by a
federal funds wire.

We use procedures reasonably designed to confirm that telephone
instructions are genuine. These include recording the
conversation, testing the identity of the caller by asking for
account information, and sending prompt written confirmation of
the transaction to the shareholder of record. If these procedures
are followed, the Fund and its service providers will not be
liable for any losses due to unauthorized or fraudulent
instructions.

If the amount you redeem is large enough to affect the Fund's
operation, the Fund may pay the redemption "in kind." This is
payment in portfolio securities rather than cash. If this occurs,
you may incur transaction costs when you sell the securities.

Redemption Fee

The Fund charges a 1% redemption fee on sales of Fund shares that
you have held less than 90 days. The fee is retained by the Fund
for the benefit of the remaining shareholders. The fee is waived
for shares purchased through certain retirement plans, including
401(k) plans, 403(b) plans, 457 plans, Keogh accounts, and Stein
Roe Profit Sharing and Money Purchase Pension Plans. The fee
waiver may not

apply to shares purchased through an Intermediary maintaining an
omnibus account with the Fund. Before purchasing shares, please
check with your account representative concerning the availability
of the waiver. The fee waiver does not apply to IRA and SEP-IRA
accounts. The redemption fee is intended to encourage long-term
investment in the Fund, to avoid transaction and other expenses
caused by early redemptions, and to facilitate portfolio
management. The fee does not benefit Stein Roe in any way. The
Fund may modify the terms of, terminate, or waive this fee at any
time.

Involuntary Redemption

If your account value falls below $1,000, the Fund may redeem your
shares and send the proceeds to the registered address. You will
receive notice 30 days before this happens. If your account falls
below $10, the Fund may redeem your shares without notice to you.

Low Balance Fee

Due to the expense of maintaining accounts with low balances, if
your account balance falls below $2,000 ($800 for custodial
accounts), you will be charged a low balance fee of $5 per
quarter. The low balance fee does not apply to: (1) shareholders
whose accounts in the Stein Roe Funds total $50,000 or more; (2)
Stein Roe IRAs; (3) other Stein Roe prototype retirement plans;
(4) accounts with automatic investment plans (unless regular
investments have been discontinued); or (5) omnibus or nominee
accounts. The Fund can waive the fee, at its discretion, in the
event of significant market corrections.

Distribution and Service Fees

The Fund has adopted a plan under Rule 12b-1 that permits it to
pay marketing and other fees to support the sale and distribution
of shares and the services provided to you by your financial
advisor. Annual distribution and service fees may equal up to
0.25% and are paid out of the assets of the Fund. Over time,
these fees will increase the cost of your shares and may cost you
more than paying other types of sales charges.

Reporting to Shareholders

To reduce the volume of mail you receive, only one copy of certain
materials, such as prospectuses and shareholder reports, will be
mailed to your household (same address). Please call 800-338-2550
if you want to receive additional copies free of charge. This
policy may not apply if you purchase shares through an
intermediary.

EXCHANGING SHARES You may exchange Fund shares for shares of
other Stein Roe no-load funds. Call 800-338-2550 to request a
prospectus and application for the fund you wish to exchange into.
Please be sure to read the prospectus carefully before you
exchange your shares.

The account you exchange into must be registered exactly the same
as the account you exchange from. You must meet all investment
minimum requirements for the fund you wish to exchange into before
we can process your exchange transaction.

An exchange is a redemption and purchase of shares for tax
purposes, and you may realize a gain or a loss when you exchange
Fund shares for shares of another fund.

We may change, suspend or eliminate the exchange service after
notification to you.

Generally, we limit you to four telephone exchanges "roundtrips"
per year. A roundtrip is an exchange out of the Fund into another
Stein Roe no-load fund and then back to the Fund.

DIVIDENDS AND DISTRIBUTIONS The Fund distributes, at least once
a year, virtually all of its net investment income and net
realized capital gains.

A dividend from net investment income represents the income the
Fund earns from dividends and interest paid on its investments,
after payment of the Fund's expenses.

A capital gain is the increase in value of a security that the
Fund holds. The gain is "unrealized" until the security is sold.
Each realized capital gain is either short term or long term
depending on whether the Fund held the security for one year or
less or more than one year, regardless of how long you have held
your Fund shares.

When the Fund makes a distribution of income or capital gains, the
distribution is automatically invested in additional shares of the
Fund unless you elect on the account application to have
distributions paid by check.

[CALLOUT]
OPTIONS FOR RECEIVING DISTRIBUTION AND REDEMPTION PROCEEDS:
* by check
* by electronic transfer into your bank account
* a purchase of shares of another Stein Roe fund
* a purchase of shares in a Stein Roe fund account of another
person
[/CALLOUT]

If you elect to receive distributions by check and a distribution
check is returned to the Fund as undeliverable, or if you do not
present a distribution check for payment within six months, we
will change the distribution option on your account and reinvest
the proceeds of the check in additional shares of the Fund. You
will not receive any interest on amounts represented by uncashed
distribution or redemption checks.

Tax Consequences

You are subject to federal income tax on both dividends and
capital gains distributions whether you elect to receive them in
cash or reinvest them in additional shares of the Fund. If the
Fund declares a distribution in December, but does not pay it
until after December 31, you will be taxed as if the distribution
were paid in December. Stein Roe will process your distributions
and send you a statement for tax purposes each year showing the
source of distributions for the preceding year.

TRANSACTION TAX STATUS
Income dividend Ordinary income
Short-term capital gain distribution Ordinary income
Long-term capital gain distribution Capital gain
Sale of shares owned one year or less Gain is ordinary income;
loss is subject to special
rules
Sale of shares owned more than one year Capital gain or loss

In addition to the dividends and capital gains distributions made
by a Fund, you may realize a capital gain or loss when selling and
exchanging Fund shares. Such transactions may be subject to
federal income tax.

This tax information provides only a general overview. It does
not apply if you invest in a tax-deferred retirement account such
as an IRA. Please consult your own tax advisor about the tax
consequences of an investment in the Fund.

OTHER INVESTMENTS AND RISKS

The first portion of this prospectus describes the Fund's
principal investment strategy and principal investment risks. In
seeking to meet its investment goals, the Fund also may invest in
other securities and use other investment techniques. The Fund
may elect not to buy any of these other securities or use any of
these other investment techniques. The Fund may not always
achieve its investment goal.

This section describes certain of those other securities and
techniques, and certain risks associated with them. The Statement
of Additional Information (SAI) contains additional information
about the Fund's securities and investment techniques (including
other securities and techniques) and the risks associated with
them. The SAI also contains the Fund's fundamental and non-
fundamental investment policies.

The Fund's portfolio managers generally make decisions on buying
and selling portfolio investments based upon their judgment that
the decision will improve the Fund's investment return and further
its investment goal. The portfolio managers may also be required
to sell portfolio investments to fund redemptions.

SHORT SALES The Fund may make short sales of securities. Short
selling involves the sale of borrowed securities. When the Fund
thinks the price of a stock will decline, it borrows the stock and
then sells the borrowed stock. When the Fund has to return the
borrowed stock, it tries to buy the stock at a lower price. If
the Fund is successful, it has a capital gain. If the Fund is
unsuccessful and buys the stock at a higher price than the price
at which it sold the stock, the Fund has a capital loss. The
Fund's capital gains and losses may result in federal income tax
consequences to the Fund's shareholders. Short selling involves
certain risks. The Fund could have a loss if the borrowed
security increases in value and if the purchased security declines
in value.

FUTURES The Fund uses futures to hedge against price changes in
the value of its current or intended investments in securities. A
future is an agreement to buy or sell a specific amount of a
financial instrument or physical commodity for an agreed-upon
price at a certain time in the future. The Fund can lose money if
the portfolio managers do not correctly anticipate the market
movements of those underlying securities.

OPTIONS The Fund may buy or sell (write) exchange-listed and
negotiated put and call options for hedging or speculative
purposes. An option is an instrument that provides a right to buy
(call) or sell (put) a particular security, currency, or index of
securities at a fixed price within a certain time period. Such
options may be on individual securities or on indexes.

A put option gives the Fund, in return for the payment of a
premium, the right to sell the underlying security or index to
another party at a fixed price. If the market value of the
underlying security or index declines, the value of the put option
would be expected to rise. If the market value of the underlying
security or index remains the

same or rises, however, the put option could lose all of its
value, resulting in a loss to the Fund.

A call option gives the Fund, in return for the payment of a
premium, the right to purchase the underlying security or index
from another party at a fixed price. If the market value of the
underlying security or index rises, the value of the call option
would also be expected to rise. If the market value of the
underlying security or index remains the same or declines,
however, the call option could lose all of its value, resulting in
a loss to the Fund.

The Fund may invest up to 15% of its assets in options. The Fund
is not obligated to pursue any hedging strategy. In addition,
hedging practices may not be available, may be too costly to be
used effectively, or may be unable to be used for other reasons.

PORTFOLIO TURNOVER There are no limits on turnover. Turnover
may vary significantly from year to year. Stein Roe does not
expect it to exceed 200% under normal conditions. Portfolio
turnover typically produces capital gains or losses for Fund
shareholders resulting in tax consequences for the Fund's
shareholders. It also increases transaction expenses, which
reduce the Fund's return.

TEMPORARY DEFENSIVE POSITIONS When Stein Roe believes that a
temporary defensive position is necessary, the Fund may invest,
without limit, in high-quality debt securities or hold assets in
cash and cash equivalents. Stein Roe is not required to take a
temporary defensive position, and market conditions may prevent
such an action. The Fund may not achieve its investment objective
if it takes a defensive position.

INTERFUND LENDING PROGRAM The Fund may lend money to and borrow
money from other funds advised by Stein Roe. The Fund will do so
when Stein Roe believes such lending or borrowing is necessary and
appropriate. Borrowing costs will be the same as or lower than
the costs of a bank loan.

THE FUND'S MANAGEMENT

INVESTMENT ADVISER Stein Roe & Farnham Incorporated, One South
Wacker Drive, Chicago, IL 60606, manages the day-to-day operations
of the Fund. Stein Roe (and its predecessor) has advised and
managed mutual funds since 1949. The Fund pays Stein Roe an
annual management fee of 0.75% of average net assets and an annual
administrative fee of 0.15% of average net assets.

Stein Roe's mutual funds and institutional investment advisory
businesses are part of a larger business unit that includes
several separate legal entities known as Liberty Funds Group
(LFG). LFG includes certain affiliates of Stein Roe, including
Colonial Management Associates, Inc. (Colonial). The LFG business
unit is managed by a single management team. Colonial and other
LFG entities also share personnel, facilities, and systems with
Stein Roe that may be used in providing administrative or
operational services to the Funds. Colonial is a registered
investment adviser. Stein Roe also has a wealth management
business that is not part of LFG and is managed by a different
team. Stein Roe and the other entities that make up LFG are
subsidiaries of Liberty Financial Companies, Inc.

Stein Roe can use the services of AlphaTrade Inc., an affiliated
broker-dealer, when buying or selling equity securities for the
Fund's portfolio, pursuant to procedures adopted by the Fund's
Board of Trustees.

PORTFOLIO MANAGERS ________ and David P. Brady are the portfolio
managers.

Mr. ______ is ____________________.

Mr. Brady, a senior vice president, joined Stein Roe in 1993 and
served as an associate portfolio manager of Stein Roe Special Fund
until March 1995. Mr. Brady has been portfolio manager of Stein
Roe Young Investor Fund since March 1995, portfolio manager of
Stein Roe Large Company Focus Fund since June 1998, portfolio
manager of Stein Roe Growth Investor Fund since March 1999, and
portfolio manager of Stein Roe Capital Opportunities Fund since
May 1999 . He holds a B.S. in finance, graduating Magna Cum
Laude, from the University of Arizona and an M.B.A. from the
University of Chicago. As of _____, 1999, Mr. Brady managed $___
million in mutual fund net assets.

MASTER/FEEDER FUND STRUCTURE The Fund could convert into a
"feeder" fund in a "master/feeder" structure at some future date.
This means that all of the Fund's assets would be invested in a
larger "master" portfolio of securities that has investment
objectives and policies substantially identical to those of the
Fund.

YEAR 2000 READINESS Like other investment companies, financial
and business organizations and individuals around the world, the
Fund could be adversely affected if the computer systems used by
Stein Roe, other service providers, and the companies

in which the Fund invests do not properly process and calculate
date-related information and data from and after Jan. 1, 2000.
This is commonly known as the "Year 2000 Problem." The Fund's
service providers are taking steps that they believe are
reasonably designed to address the Year 2000 problem, including
communicating with vendors who furnish services, software and
systems to the Fund to provide that date-related information and
data can be properly processed after Jan. 1, 2000. Many Fund
service providers and vendors, including the Fund's service
providers, are in the process of making Year 2000 modifications to
their software and systems and believe that such modifications
will be completed on a timely basis prior to Jan. 1, 2000. In
addition, Year 2000 readiness is one of the factors considered by
Stein Roe in its ongoing assessment of companies in which the Fund
invests, to the extent that information is readily available.
However, no assurances can be given that the Fund will not be
adversely affected by these matters.

FOR MORE INFORMATION

You can obtain more information about the Fund's investments in
its semiannual and annual reports to shareholders. These reports
discuss the market conditions and investment strategies that
affected the Fund's performance over the past six months and year.

You may wish to read the Fund's SAI for more information. The SAI
is incorporated into this prospectus by reference, which means
that it is legally considered to be part of this prospectus and
you are deemed to have been told of its contents.

To obtain free copies of the Fund's semiannual and annual reports
or SAI or to request other information about the Fund, write or
call:

Stein Roe Mutual Funds
One South Wacker Drive
Suite 3200
Chicago, IL 60606
800-338-2550

www.steinroe.com

Text-only versions of all Fund documents can be viewed online or
downloaded from the Securities and Exchange Commission (SEC) at
www.sec.gov. You can also obtain copies by visiting the SEC's
Public Reference Room in Washington, DC, by calling 800-SEC-0330,
or by sending your request and the appropriate fee to the SEC's
public reference section, Washington, DC 20549-6009.

Investment Company Act file number of Liberty-Stein Roe Advisor
Trust: 811-07955

LIBERTY FUNDS DISTRIBUTOR, INC.

PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED AUGUST 10, 1999

The information in this Statement of Additional Information is not
complete and may be changed. We may not sell these securities
until the registration statement filed with the Securities and
Exchange Commission is effective. This Statement of Additional
Information is not an offer to sell these securities and is not a
soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.

Statement of Additional Information Dated _______, 1999

LIBERTY-STEIN ROE ADVISOR TRUST
Suite 3200, One South Wacker Drive, Chicago, IL 60606
800-338-2550

Stein Roe Internet Leaders Fund

This Statement of Additional Information ("SAI") is not a
prospectus, but provides additional information that should be
read in conjunction with the prospectus of Stein Roe Internet
Leaders Fund dated _______, 1999, and any supplements thereto
("Prospectus"). The Prospectus may be obtained at no charge by
telephoning 800-338-2550.

TABLE OF CONTENTS
Page
General Information.........................................2
Investment Policies.........................................3
Portfolio Investments and Strategies........................3
Investment Restrictions....................................19
Additional Investment Considerations.......................21
Purchases and Redemptions..................................22
Management.................................................26
Principal Shareholders.....................................29
Investment Advisory and Other Services.....................29
Distributor................................................31
Transfer Agent.............................................32
Custodian..................................................33
Independent Public Accountants.............................33
Portfolio Transactions.....................................34
Additional Income Tax Considerations.......................38
Investment Performance.....................................39
Appendix-Ratings...........................................43

GENERAL INFORMATION

Stein Roe Internet Leaders Fund (the "Fund") is a series of
Liberty-Stein Roe Advisor Trust (the "Trust"). The Trust is a
Massachusetts business trust organized under an Agreement and
Declaration of Trust ("Declaration of Trust") dated July 31, 1996,
which provides that each shareholder shall be deemed to have
agreed to be bound by the terms thereof. The Declaration of Trust
may be amended by a vote of either the Trust's shareholders or its
trustees. The Trust may issue an unlimited number of shares, in
one or more series as the Board may authorize. Currently, six
series are authorized and outstanding. Each series invests in a
separate portfolio of securities and other assets, with its own
objectives and policies. On Sept. 13, 1996, the spelling of the
name of the Trust was changed from "Adviser" to "Advisor." The
name of the Trust was changed from Stein Roe Advisor Trust to
Liberty-Stein Roe Advisor Trust on March 3, 1999.

Under Massachusetts law, shareholders of a Massachusetts
business trust such as the Trust could, in some circumstances, be
held personally liable for unsatisfied obligations of the trust.
The Declaration of Trust provides that persons extending credit
to, contracting with, or having any claim against the Trust or any
particular series shall look only to the assets of the Trust or of
the respective series for payment under such credit, contract or
claim, and that the shareholders, trustees and officers shall have
no personal liability therefor. The Declaration of Trust requires
that notice of such disclaimer of liability be given in each
contract, instrument or undertaking executed or made on behalf of
the Trust. The Declaration of Trust provides for indemnification
of any shareholder against any loss and expense arising from
personal liability solely by reason of being or having been a
shareholder. Thus, the risk of a shareholder incurring financial
loss on account of shareholder liability is believed to be remote,
because it would be limited to circumstances in which the
disclaimer was inoperative and the Trust was unable to meet its
obligations. The risk of a particular series incurring financial
loss on account of unsatisfied liability of another series of the
Trust also is believed to be remote, because it would be limited
to claims to which the disclaimer did not apply and to
circumstances in which the other series was unable to meet its
obligations.

Each share of a series, without par value, is entitled to
participate pro rata in any dividends and other distributions
declared by the Board on shares of that series, and all shares of
a series have equal rights in the event of liquidation of that
series. Each whole share (or fractional share) outstanding on the
record date established in accordance with the By-Laws shall be
entitled to a number of votes on any matter on which it is
entitled to vote equal to the net asset value of the share (or
fractional share) in United States dollars determined at the close
of business on the record date (for example, a share having a net
asset value of $10.50 would be entitled to 10.5 votes). As a
business trust, the Trust is not required to hold annual
shareholder meetings. However, special meetings may be called for
purposes such as electing or removing trustees, changing
fundamental policies, or approving an investment advisory
contract. If requested to do so by the holders of at least 10% of
its outstanding shares, the Trust will call a special meeting for
the purpose of voting upon the question of removal of a trustee or
trustees and will assist in the communications with other
shareholders as if the Trust were subject to Section 16(c) of the
Investment Company Act of 1940. All shares of all series of the
Trust are voted together in the election of trustees. On any
other matter submitted to a vote of shareholders, shares are voted
in the aggregate and not by individual

series, except that shares are voted by individual series when
required by the Investment Company Act of 1940 or other applicable
law, or when the Board of Trustees determines that the matter
affects only the interests of one or more series, in which case
shareholders of the unaffected series are not entitled to vote on
such matters.

Stein Roe & Farnham Incorporated ("Stein Roe") provides
administrative and accounting and recordkeeping services and
investment management services to the Fund.

Special Considerations Regarding Master Fund/Feeder Fund Structure

The Fund has the ability to convert into a "feeder fund";
that is, rather than invest in securities directly, it may seek to
achieve its objective by pooling its assets with those of other
investment companies for investment in a separate "master fund"
having the same investment objective and substantially the same
investment policies as its feeder funds. The purpose of such an
arrangement is to achieve greater operational efficiencies and
reduce costs.

INVESTMENT POLICIES

The Trust is an open-end management investment company. The
Fund is diversified, as that term is defined in the Investment
Company Act of 1940.

The investment objective and policies are described in the
Prospectus under The Fund. In pursuing its objective, the Fund
may also employ the investment techniques described under
Portfolio Investments and Strategies in this SAI. The investment
objective is a nonfundamental policy and may be changed by the
Board of Trustees without the approval of a "majority of the
outstanding voting securities."/1/
- -------------
/1/ A "majority of the outstanding voting securities" means the
approval of the lesser of (i) 67% or more of the shares at a
meeting if the holders of more than 50% of the outstanding shares
are present or represented by proxy or (ii) more than 50% of the
outstanding shares.
- -------------

PORTFOLIO INVESTMENTS AND STRATEGIES

Debt Securities

In pursuing its investment objective, the Fund may invest in
debt securities of corporate and governmental issuers. The risks
inherent in debt securities depend primarily on the term and
quality of the obligations in the investment portfolio as well as
on market conditions. A decline in the prevailing levels of
interest rates generally increases the value of debt securities,
while an increase in rates usually reduces the value of those
securities.

Debt securities within the four highest grades are generally
referred to as "investment grade"). The Fund may invest up to 35%
of its net assets in debt securities, but does not expect to
invest more than 5% of its net assets in debt securities that are
rated below investment grade.

Securities in the fourth highest grade may possess
speculative characteristics, and changes in economic conditions
are more likely to affect the issuer's capacity to pay interest

and repay principal. If the rating of a security held is lost or
reduced below investment grade, the Fund is not required to
dispose of the security, but Stein Roe will consider that fact in
determining whether to should continue to hold the security.

Securities that are rated below investment grade are
considered predominantly speculative with respect to the issuer's
capacity to pay interest and repay principal according to the
terms of the obligation and therefore carry greater investment
risk, including the possibility of issuer default and bankruptcy.

When Stein Roe determines that adverse market or economic
conditions exist and considers a temporary defensive position
advisable, the Fund may invest without limitation in high-quality
fixed income securities or hold assets in cash or cash
equivalents.

Derivatives

Consistent with its objective, the Fund may invest in a broad
array of financial instruments and securities, including
conventional exchange-traded and non-exchange-traded options,
futures contracts, futures options, securities collateralized by
underlying pools of mortgages or other receivables, floating rate
instruments, and other instruments that securitize assets of
various types ("Derivatives"). In each case, the value of the
instrument or security is "derived" from the performance of an
underlying asset or a "benchmark" such as a security index, an
interest rate, or a currency.

Derivatives are most often used to manage investment risk or
to create an investment position indirectly because using them is
more efficient or less costly than direct investment that cannot
be readily established directly due to portfolio size, cash
availability, or other factors. They also may be used in an
effort to enhance portfolio returns.

The successful use of Derivatives depends on Stein Roe's
ability to correctly predict changes in the levels and directions
of movements in security prices, interest rates and other market
factors affecting the Derivative itself or the value of the
underlying asset or benchmark. In addition, correlations in the
performance of an underlying asset to a Derivative may not be well
established. Finally, privately negotiated and over-the-counter
Derivatives may not be as well regulated and may be less
marketable than exchange-traded Derivatives. The Fund does not
currently intend to invest more than 5% of its net assets in any
type of Derivative except for options, futures contracts, and
futures options. (See Options and Futures below.)

Some mortgage-backed debt securities are of the "modified
pass-through type," which means the interest and principal
payments on mortgages in the pool are "passed through" to
investors. During periods of declining interest rates, there is
increased likelihood that mortgages will be prepaid, with a
resulting loss of the full-term benefit of any premium paid by the
Fund on purchase of such securities; in addition, the proceeds of
prepayment would likely be invested at lower interest rates.

Mortgage-backed securities provide either a pro rata interest
in underlying mortgages or an interest in collateralized mortgage
obligations ("CMOs") that represent a right to

interest and/or principal payments from an underlying mortgage
pool. CMOs are not guaranteed by either the U.S. Government or by
its agencies or instrumentalities, and are usually issued in
multiple classes each of which has different payment rights,
prepayment risks, and yield characteristics. Mortgage-backed
securities involve the risk of prepayment on the underlying
mortgages at a faster or slower rate than the established
schedule. Prepayments generally increase with falling interest
rates and decrease with rising rates but they also are influenced
by economic, social, and market factors. If mortgages are pre-
paid during periods of declining interest rates, there would be a
resulting loss of the full-term benefit of any premium paid by the
Fund on purchase of the CMO, and the proceeds of prepayment would
likely be invested at lower interest rates.

Non-mortgage asset-backed securities usually have less
prepayment risk than mortgage-backed securities, but have the risk
that the collateral will not be available to support payments on
the underlying loans that finance payments on the securities
themselves.

Floating rate instruments provide for periodic adjustments in
coupon interest rates that are automatically reset based on
changes in amount and direction of specified market interest
rates. In addition, the adjusted duration of some of these
instruments may be materially shorter than their stated
maturities. To the extent such instruments are subject to
lifetime or periodic interest rate caps or floors, such
instruments may experience greater price volatility than debt
instruments without such features. Adjusted duration is an
inverse relationship between market price and interest rates and
refers to the approximate percentage change in price for a 100
basis point change in yield. For example, if interest rates
decrease by 100 basis points, a market price of a security with an
adjusted duration of 2 would increase by approximately 2%.

Convertible Securities

By investing in convertible securities, the Fund obtains the
right to benefit from the capital appreciation potential in the
underlying stock upon exercise of the conversion right, while
earning higher current income than would be available if the stock
were purchased directly. In determining whether to purchase a
convertible, Stein Roe will consider substantially the same
criteria that would be considered in purchasing the underlying
stock. While convertible securities it purchases are frequently
rated investment grade, the Fund may purchase unrated securities
or securities rated below investment grade if the securities meet
Stein Roe's other investment criteria. Convertible securities
rated below investment grade (a) tend to be more sensitive to
interest rate and economic changes, (b) may be obligations of
issuers who are less creditworthy than issuers of higher quality
convertible securities, and (c) may be more thinly traded due to
such securities being less well known to investors than investment
grade convertible securities, common stock or conventional debt
securities. As a result, Stein Roe's own investment research and
analysis tend to be more important in the purchase of such
securities than other factors.

Foreign Securities

The Fund may invest up to 25% of its total assets in foreign
securities, which may entail a greater degree of risk (including
risks relating to exchange rate fluctuations, tax

provisions, or expropriation of assets) than investment in
securities of domestic issuers. For this purpose, foreign
securities do not include American Depositary Receipts (ADRs) or
securities guaranteed by a United States person. ADRs are
receipts typically issued by an American bank or trust company
evidencing ownership of the underlying securities. The Fund may
invest in sponsored or unsponsored ADRs. In the case of an
unsponsored ADR, the Fund is likely to bear its proportionate
share of the expenses of the depositary and it may have greater
difficulty in receiving shareholder communications than it would
have with a sponsored ADR. The Fund does not intend to invest,
nor during the past fiscal year has it invested, more than 5% of
its net assets in unsponsored ADRs.

With respect to portfolio securities that are issued by
foreign issuers or denominated in foreign currencies, investment
performance is affected by the strength or weakness of the U.S.
dollar against these currencies. For example, if the dollar falls
in value relative to the Japanese yen, the dollar value of a yen-
denominated stock held in the portfolio will rise even though the
price of the stock remains unchanged. Conversely, if the dollar
rises in value relative to the yen, the dollar value of the yen-
denominated stock will fall. (See discussion of transaction
hedging and portfolio hedging under Currency Exchange
Transactions.)

Investors should understand and consider carefully the risks
involved in foreign investing. Investing in foreign securities,
positions which are generally denominated in foreign currencies,
and utilization of forward foreign currency exchange contracts
involve certain considerations comprising both risks and
opportunities not typically associated with investing in U.S.
securities. These considerations include: fluctuations in
exchange rates of foreign currencies; possible imposition of
exchange control regulation or currency restrictions that would
prevent cash from being brought back to the United States; less
public information with respect to issuers of securities; less
governmental supervision of stock exchanges, securities brokers,
and issuers of securities; lack of uniform accounting, auditing,
and financial reporting standards; lack of uniform settlement
periods and trading practices; less liquidity and frequently
greater price volatility in foreign markets than in the United
States; possible imposition of foreign taxes; possible investment
in securities of companies in developing as well as developed
countries; and sometimes less advantageous legal, operational, and
financial protections applicable to foreign sub-custodial
arrangements.

Although the Fund will try to invest in companies and
governments of countries having stable political environments,
there is the possibility of expropriation or confiscatory
taxation, seizure or nationalization of foreign bank deposits or
other assets, establishment of exchange controls, the adoption of
foreign government restrictions, or other adverse political,
social or diplomatic developments that could affect investment in
these nations.

Currency Exchange Transactions. Currency exchange
transactions may be conducted either on a spot (i.e., cash) basis
at the spot rate for purchasing or selling currency prevailing in
the foreign exchange market or through forward currency exchange
contracts ("forward contracts"). Forward contracts are
contractual agreements to purchase or sell a specified currency at
a specified future date (or within a specified time period) and
price set at the time of the contract. Forward contracts are
usually entered into with banks and broker-dealers, are not
exchange traded, and are usually for less than one year, but may
be renewed.

The Fund's foreign currency exchange transactions are limited
to transaction and portfolio hedging involving either specific
transactions or portfolio positions. Transaction hedging is the
purchase or sale of forward contracts with respect to specific
receivables or payables of the Fund arising in connection with the
purchase and sale of its portfolio securities. Portfolio hedging
is the use of forward contracts with respect to portfolio security
positions denominated or quoted in a particular foreign currency.
Portfolio hedging allows it to limit or reduce its exposure in a
foreign currency by entering into a forward contract to sell such
foreign currency (or another foreign currency that acts as a proxy
for that currency) at a future date for a price payable in U.S.
dollars so that the value of the foreign-denominated portfolio
securities can be approximately matched by a foreign-denominated
liability. The Fund may not engage in portfolio hedging with
respect to the currency of a particular country to an extent
greater than the aggregate market value (at the time of making
such sale) of the securities held in its portfolio denominated or
quoted in that particular currency, except that it may hedge all
or part of its foreign currency exposure through the use of a
basket of currencies or a proxy currency where such currencies or
currency act as an effective proxy for other currencies. In such
a case, the Fund may enter into a forward contract where the
amount of the foreign currency to be sold exceeds the value of the
securities denominated in such currency. The use of this basket
hedging technique may be more efficient and economical than
entering into separate forward contracts for each currency it
holds. The Fund may not engage in "speculative" currency exchange
transactions.

At the maturity of a forward contract to deliver a particular
currency, the Fund may either sell the portfolio security related
to such contract and make delivery of the currency, or it may
retain the security and either acquire the currency on the spot
market or terminate its contractual obligation to deliver the
currency by purchasing an offsetting contract with the same
currency trader obligating it to purchase on the same maturity
date the same amount of the currency.

It is impossible to forecast with absolute precision the
market value of portfolio securities at the expiration of a
forward contract. Accordingly, it may be necessary for the Fund
to purchase additional currency on the spot market (and bear the
expense of such purchase) if the market value of the security is
less than the amount of currency it is obligated to deliver and if
a decision is made to sell the security and make delivery of the
currency. Conversely, it may be necessary to sell on the spot
market some of the currency received upon the sale of the
portfolio security if its market value exceeds the amount of
currency it is obligated to deliver.

If the Fund retains the portfolio security and engages in an
offsetting transaction, it will incur a gain or a loss to the
extent that there has been movement in forward contract prices.
If the Fund engages in an offsetting transaction, it may
subsequently enter into a new forward contract to sell the
currency. Should forward prices decline during the period between
the Fund's entering into a forward contract for the sale of a
currency and the date it enters into an offsetting contract for
the purchase of the currency, it will realize a gain to the extent
the price of the currency it has agreed to sell exceeds the price
of the currency it has agreed to purchase. Should forward prices
increase, the Fund will suffer a loss to the extent the price of
the currency it has agreed to purchase exceeds the price of the
currency it has

agreed to sell. A default on the contract would deprive it of
unrealized profits or force it to cover its commitments for
purchase or sale of currency, if any, at the current market price.

Hedging against a decline in the value of a currency does not
eliminate fluctuations in the prices of portfolio securities or
prevent losses if the prices of such securities decline. Such
transactions also preclude the opportunity for gain if the value
of the hedged currency should rise. Moreover, it may not be
possible for the Fund to hedge against a devaluation that is so
generally anticipated that it is not able to contract to sell the
currency at a price above the devaluation level it anticipates.
The cost to the Fund of engaging in currency exchange transactions
varies with such factors as the currency involved, the length of
the contract period, and prevailing market conditions. Since
currency exchange transactions are usually conducted on a
principal basis, no fees or commissions are involved.

Swaps, Caps, Floors and Collars

The Fund may enter into swaps and may purchase or sell
related caps, floors and collars. It would enter into these
transactions primarily to preserve a return or spread on a
particular investment or portion of its portfolio, to protect
against currency fluctuations, as a duration management technique
or to protect against any increase in the price of securities it
purchases at a later date. The Fund intends to use these
techniques as hedges and not as speculative investments and will
not sell interest rate income stream it may be obligated to pay.

A swap agreement is generally individually negotiated and
structured to include exposure to a variety of different types of
investments or market factors. Depending on its structure, a swap
agreement may increase or decrease the exposure to changes in the
value of an index of securities in which the Fund might invest,
the value of a particular security or group of securities, or
foreign currency values. Swap agreements can take many different
forms and are known by a variety of names. The Fund may enter
into any form of swap agreement if Stein Roe determines it is
consistent with its investment objective and policies.

A swap agreement tends to shift the Fund's investment
exposure from one type of investment to another. For example, if
it agrees to exchange payments in dollars at a fixed rate for
payments in a foreign currency the amount of which is determined
by movements of a foreign securities index, the swap agreement
would tend to increase exposure to foreign stock market movements
and foreign currencies. Depending on how it is used, a swap
agreement may increase or decrease the overall volatility of its
investments and its net asset value.

The performance of a swap agreement is determined by the
change in the specific currency, market index, security, or other
factors that determine the amounts of payments due to and from the
Fund. If a swap agreement calls for payments by the Fund, it must
be prepared to make such payments when due. If the counterparty's
creditworthiness declines, the value of a swap agreement would be
likely to decline, potentially resulting in a loss. The Fund will
not enter into any swap, cap, floor or collar transaction unless,
at the time of entering into such transaction, the unsecured long-
term debt of the counterparty, combined with any credit
enhancements, is rated at least A by Standard & Poor's Corporation
or

Moody's Investors Service, Inc. or has an equivalent rating
from a nationally recognized statistical rating organization or is
determined to be of equivalent credit quality by Stein Roe.

The purchase of a cap entitles the purchaser to receive
payments on a notional principal amount from the party selling the
cap to the extent that a specified index exceeds a predetermined
interest rate or amount. The purchase of a floor entitles the
purchaser to receive payments on a notional principal amount from
the party selling such floor to the extent that a specified index
falls below a predetermined interest rate or amount. A collar is
a combination of a cap and floor that preserves a certain return
within a predetermined range of interest rates or values.

At the time the Fund enters into swap arrangements or
purchases or sells caps, floors or collars, liquid assets having a
value at least as great as the commitment underlying the
obligations will be segregated on the books of the Fund and held
by the custodian throughout the period of the obligation.

Lending of Portfolio Securities

Subject to restriction (5) under Investment Restrictions in
this SAI, the Fund may lend its portfolio securities to broker-
dealers and banks. Any such loan must be continuously secured by
collateral in cash or cash equivalents maintained on a current
basis in an amount at least equal to the market value of the
securities loaned by the Fund. It would continue to receive the
equivalent of the interest or dividends paid by the issuer on the
securities loaned, and would also receive an additional return
that may be in the form of a fixed fee or a percentage of the
collateral. It would have the right to call the loan and obtain
the securities loaned at any time on notice of not more than five
business days. It would not have the right to vote the securities
during the existence of the loan but would call the loan to permit
voting of the securities if, in Stein Roe's judgment, a material
event requiring a shareholder vote would otherwise occur before
the loan was repaid. In the event of bankruptcy or other default
of the borrower, it could experience both delays in liquidating
the loan collateral or recovering the loaned securities and
losses, including (a) possible decline in the value of the
collateral or in the value of the securities loaned during the
period while it seeks to enforce its rights thereto, (b) possible
subnormal levels of income and lack of access to income during
this period, and (c) expenses of enforcing its rights.

Repurchase Agreements

The Fund may invest in repurchase agreements, provided that
it will not invest more than 15% of net assets in repurchase
agreements maturing in more than seven days and any other illiquid
securities. A repurchase agreement is a sale of securities to the
Fund in which the seller agrees to repurchase the securities at a
higher price, which includes an amount representing interest on
the purchase price, within a specified time. In the event of
bankruptcy of the seller, the Fund could experience both losses
and delays in liquidating its collateral.

When-Issued and Delayed-Delivery Securities; Reverse Repurchase
Agreements

The Fund may purchase securities on a when-issued or delayed-
delivery basis. Although the payment and interest terms of these
securities are established at the time the Fund

enters into the commitment, the securities may be delivered and
paid for a month or more after the date of purchase, when their
value may have changed. The Fund makes such commitments only with
the intention of actually acquiring the securities, but may sell
the securities before settlement date if Stein Roe deems it
advisable for investment reasons. During its last fiscal year,
the Fund did not, nor does it currently intend to have,
commitments to purchase when-issued securities in excess of 5% of
its net assets.

The Fund may enter into reverse repurchase agreements with
banks and securities dealers. A reverse repurchase agreement is a
repurchase agreement in which the Fund is the seller of, rather
than the investor in, securities and agrees to repurchase them at
an agreed-upon time and price. Use of a reverse repurchase
agreement may be preferable to a regular sale and later repurchase
of securities because it avoids certain market risks and
transaction costs.

At the time the Fund enters into a binding obligation to
purchase securities on a when-issued basis or enters into a
reverse repurchase agreement, liquid assets (cash, U.S. Government
securities or other "high-grade" debt obligations) of the Fund
having a value at least as great as the purchase price of the
securities to be purchased will be segregated on the books of the
Fund and held by the custodian throughout the period of the
obligation. The use of these investment strategies, as well as
borrowing under a line of credit as described below, may increase
net asset value fluctuation.

Short Sales "Against the Box"

The Fund may sell securities short against the box; that is,
enter into short sales of securities that it currently owns or has
the right to acquire through the conversion or exchange of other
securities that it owns at no additional cost.

In a short sale against the box, the Fund does not deliver
from its portfolio the securities sold. Instead, it borrows the
securities sold short from a broker-dealer through which the short
sale is executed, and the broker-dealer delivers such securities,
on its behalf, to the purchaser of such securities. The Fund is
required to pay to the broker-dealer the amount of any dividends
paid on shares sold short. Finally, to secure its obligation to
deliver to such broker-dealer the securities sold short, it must
deposit and continuously maintain in a separate account with its
custodian an equivalent amount of the securities sold short or
securities convertible into or exchangeable for such securities at
no additional cost. The Fund is said to have a short position in
the securities sold until it delivers to the broker-dealer the
securities sold. It may close out a short position by purchasing
on the open market and delivering to the broker-dealer an equal
amount of the securities sold short, rather than by delivering
portfolio securities.

Short sales may protect against the risk of losses in the
value of portfolio securities because any unrealized losses with
respect to such portfolio securities should be wholly or partially
offset by a corresponding gain in the short position. However,
any potential gains in such portfolio securities should be wholly
or partially offset by a corresponding loss in the short position.
The extent to which such gains or losses are offset will depend
upon the

amount of securities sold short relative to the amount it
owns, either directly or indirectly, and, in the case where it
owns convertible securities, changes in the conversion premium.

Short sale transactions involve certain risks. If the price
of the security sold short increases between the time of the short
sale and the time the Fund replaces the borrowed security, it will
incur a loss and if the price declines during this period, it will
realize a short-term capital gain. Any realized short-term
capital gain will be decreased, and any incurred loss increased,
by the amount of transaction costs and any premium, dividend or
interest which it may have to pay in connection with such short
sale. Certain provisions of the Internal Revenue Code may limit
the degree to which the Fund is able to enter into short sales.
There is no limitation on the amount of assets that, in the
aggregate, may be deposited as collateral for the obligation to
replace securities borrowed to effect short sales and allocated to
segregated accounts in connection with short sales. The Fund
currently expects that no more than 5% of its total assets would
be involved in short sales against the box.

Rule 144A Securities

The Fund may purchase securities that have been privately
placed but that are eligible for purchase and sale under Rule 144A
under the Securities Act of 1933. That Rule permits certain
qualified institutional buyers, such as the Fund, to trade in
privately placed securities that have not been registered for sale
under the 1933 Act. Stein Roe, under the supervision of the Board
of Trustees, will consider whether securities purchased under Rule
144A are illiquid and thus subject to the restriction of investing
no more than 15% of its net assets in illiquid securities. A
determination of whether a Rule 144A security is liquid or not is
a question of fact. In making this determination, Stein Roe will
consider the trading markets for the specific security, taking
into account the unregistered nature of a Rule 144A security. In
addition, Stein Roe could consider the (1) frequency of trades and
quotes, (2) number of dealers and potential purchasers, (3) dealer
undertakings to make a market, and (4) nature of the security and
of marketplace trades (e.g., the time needed to dispose of the
security, the method of soliciting offers, and the mechanics of
transfer). The liquidity of Rule 144A securities would be
monitored and if, as a result of changed conditions, it is
determined that a Rule 144A security is no longer liquid, the
Fund's holdings of illiquid securities would be reviewed to
determine what, if any, steps are required to assure that it does
not invest more than 15% of its assets in illiquid securities.
Investing in Rule 144A securities could have the effect of
increasing the amount of assets invested in illiquid securities if
qualified institutional buyers are unwilling to purchase such
securities. The Fund does not expect to invest as much as 5% of
its total assets in Rule 144A securities that have not been deemed
to be liquid by Stein Roe.

Line of Credit

Subject to restriction (6) under Investment Restrictions in
this SAI, the Fund may establish and maintain a line of credit
with a major bank in order to permit borrowing on a temporary
basis to meet share redemption requests in circumstances in which
temporary borrowing may be preferable to liquidation of portfolio
securities.

Interfund Borrowing and Lending Program

Pursuant to an exemptive order issued by the Securities and
Exchange Commission, the Fund may lend money to and borrow money
from other mutual funds advised by Stein Roe. The Fund will
borrow through the program when borrowing is necessary and
appropriate and the costs are equal to or lower than the costs of
bank loans.

Portfolio Turnover

Although the Fund does not purchase securities with a view to
rapid turnover, there are no limitations on the length of time
that portfolio securities must be held. Portfolio turnover can
occur for a number of reasons such as general conditions in the
securities markets, more favorable investment opportunities in
other securities, or other factors relating to the desirability of
holding or changing a portfolio investment. The Fund may have
greater portfolio turnover than that of a mutual funds that have
the primary objectives of income or maintenance of a balanced
investment position. The future turnover rate may vary greatly
from year to year. A high rate of portfolio turnover, if it
should occur, would result in increased transaction expenses,
which must be borne by the Fund. High portfolio turnover may also
result in the realization of capital gains or losses and, to the
extent net short-term capital gains are realized, any
distributions resulting from such gains will be considered
ordinary income for federal income tax purposes.

Options on Securities and Indexes

The Fund may purchase and sell put options and call options
on securities, indexes or foreign currencies in standardized
contracts traded on recognized securities exchanges, boards of
trade, or similar entities, or quoted on Nasdaq. The Fund may
purchase agreements, sometimes called cash puts, that may
accompany the purchase of a new issue of bonds from a dealer.

An option on a security (or index) is a contract that gives
the purchaser (holder) of the option, in return for a premium, the
right to buy from (call) or sell to (put) the seller (writer) of
the option the security underlying the option (or the cash value
of the index) at a specified exercise price at any time during the
term of the option (normally not exceeding nine months). The
writer of an option on an individual security or on a foreign
currency has the obligation upon exercise of the option to deliver
the underlying security or foreign currency upon payment of the
exercise price or to pay the exercise price upon delivery of the
underlying security or foreign currency. Upon exercise, the
writer of an option on an index is obligated to pay the difference
between the cash value of the index and the exercise price
multiplied by the specified multiplier for the index option. (An
index is designed to reflect specified facets of a particular
financial or securities market, a specific group of financial
instruments or securities, or certain economic indicators.)

The Fund will write call options and put options only if they
are "covered." For example, in the case of a call option on a
security, the option is "covered" if the Fund owns the security
underlying the call or has an absolute and immediate right to
acquire that security without additional cash consideration (or,
if additional cash consideration is required, cash or

cash equivalents in such amount are held in a segregated account
by its custodian) upon conversion or exchange of other securities
held in its portfolio.

If an option written by the Fund expires, it realizes a
capital gain equal to the premium received at the time the option
was written. If an option purchased by the Fund expires, it
realizes a capital loss equal to the premium paid.

Prior to the earlier of exercise or expiration, an option may
be closed out by an offsetting purchase or sale of an option of
the same series (type, exchange, underlying security or index,
exercise price, and expiration). There can be no assurance,
however, that a closing purchase or sale transaction can be
effected when it is desired.

The Fund will realize a capital gain from a closing purchase
transaction if the cost of the closing option is less than the
premium received from writing the option, or, if it is more, it
will realize a capital loss. If the premium received from a
closing sale transaction is more than the premium paid to purchase
the option, the Fund will realize a capital gain or, if it is
less, it will realize a capital loss. The principal factors
affecting the market value of a put or a call option include
supply and demand, interest rates, the current market price of the
underlying security or index in relation to the exercise price of
the option, the volatility of the underlying security or index,
and the time remaining until the expiration date.

A put or call option purchased by the Fund is an asset of the
Fund, valued initially at the premium paid for the option. The
premium received for an option written by the Fund is recorded as
a deferred credit. The value of an option purchased or written is
marked-to-market daily and is valued at the closing price on the
exchange on which it is traded or, if not traded on an exchange or
no closing price is available, at the mean between the last bid
and asked prices.

Risks Associated with Options on Securities and Indexes.
There are several risks associated with transactions in options.
For example, there are significant differences between the
securities markets, the currency markets, and the options markets
that could result in an imperfect correlation between these
markets, causing a given transaction not to achieve its
objectives. A decision as to whether, when and how to use options
involves the exercise of skill and judgment, and even a well-
conceived transaction may be unsuccessful to some degree because
of market behavior or unexpected events.

There can be no assurance that a liquid market will exist
when the Fund seeks to close out an option position. If it were
unable to close out an option that it had purchased on a security,
it would have to exercise the option in order to realize any
profit or the option would expire and become worthless. If it
were unable to close out a covered call option that it had written
on a security, it would not be able to sell the underlying
security until the option expired. As the writer of a covered
call option on a security, it foregoes, during the option's life,
the opportunity to profit from increases in the market value of
the security covering the call option above the sum of the premium
and the exercise price of the call.

If trading were suspended in an option purchased or written
by the Fund, it would not be able to close out the option. If
restrictions on exercise were imposed, it might be unable to
exercise an option it has purchased.

Futures Contracts and Options on Futures Contracts

The Fund may use interest rate futures contracts, index
futures contracts, and foreign currency futures contracts. An
interest rate, index or foreign currency futures contract provides
for the future sale by one party and purchase by another party of
a specified quantity of a financial instrument or the cash value
of an index/2/ at a specified price and time. A public market
exists in futures contracts covering a number of indexes
(including, but not limited to: the Standard & Poor's 500 Index,
the Value Line Composite Index, and the New York Stock Exchange
Composite Index) as well as financial instruments (including, but
not limited to: U.S. Treasury bonds, U.S. Treasury notes,
Eurodollar certificates of deposit, and foreign currencies).
Other index and financial instrument futures contracts are
available and it is expected that additional futures contracts
will be developed and traded.
- -------------
/2/ A futures contract on an index is an agreement pursuant to
which two parties agree to take or make delivery of an amount of
cash equal to the difference between the value of the index at the
close of the last trading day of the contract and the price at
which the index contract was originally written. Although the
value of a securities index is a function of the value of certain
specified securities, no physical delivery of those securities is
made.
- -------------

The Fund may purchase and write call and put futures options.
Futures options possess many of the same characteristics as
options on securities, indexes and foreign currencies (discussed
above). A futures option gives the holder the right, in return
for the premium paid, to assume a long position (call) or short
position (put) in a futures contract at a specified exercise price
at any time during the period of the option. Upon exercise of a
call option, the holder acquires a long position in the futures
contract and the writer is assigned the opposite short position.
In the case of a put option, the opposite is true. The Fund
might, for example, use futures contracts to hedge against or gain
exposure to fluctuations in the general level of stock prices,
anticipated changes in interest rates or currency fluctuations
that might adversely affect either the value of its securities or
the price of the securities that it intends to purchase. Although
other techniques could be used to reduce or increase exposure to
stock price, interest rate and currency fluctuations, the Fund may
be able to achieve its exposure more effectively and perhaps at a
lower cost by using futures contracts and futures options.

The Fund will only enter into futures contracts and futures
options that are standardized and traded on an exchange, board of
trade, or similar entity, or quoted on an automated quotation
system.

The success of any futures transaction depends on accurate
predictions of changes in the level and direction of stock prices,
interest rates, currency exchange rates and other factors. Should
those predictions be incorrect, the return might have been better
had the transaction not been attempted; however, in the absence of
the ability to use futures contracts, Stein Roe might have taken
portfolio actions in anticipation of the same market movements
with similar investment results but, presumably, at greater
transaction costs.

When a purchase or sale of a futures contract is made by the
Fund, it is required to deposit with its custodian (or broker, if
legally permitted) a specified amount of cash or U.S. Government
securities or other securities acceptable to the broker ("initial
margin"). The margin required for a futures contract is set by
the exchange on which the contract is traded and may be modified
during the term of the contract. The initial margin is in the
nature of a performance bond or good faith deposit on the futures
contract, which is returned to the Fund upon termination of the
contract, assuming all contractual obligations have been
satisfied. The Fund expects to earn interest income on its
initial margin deposits. A futures contract held is valued daily
at the official settlement price of the exchange on which it is
traded. Each day the Fund pays or receives cash, called
"variation margin," equal to the daily change in value of the
futures contract. This process is known as "marking-to-market."
Variation margin paid or received by the Fund does not represent a
borrowing or loan by it but is instead settlement between it and
the broker of the amount one would owe the other if the futures
contract had expired at the close of the previous day. In
computing daily net asset value, the Fund will mark-to-market its
open futures positions.

The Fund is also required to deposit and maintain margin with
respect to put and call options on futures contracts written by
it. Such margin deposits will vary depending on the nature of the
underlying futures contract (and the related initial margin
requirements), the current market value of the option, and other
futures positions held.

Although some futures contracts call for making or taking
delivery of the underlying securities, usually these obligations
are closed out prior to delivery by offsetting purchases or sales
of matching futures contracts (same exchange, underlying security
or index, and delivery month). If an offsetting purchase price is
less than the original sale price, the Fund realizes a capital
gain, or if it is more, it realizes a capital loss. Conversely,
if an offsetting sale price is more than the original purchase
price, it realizes a capital gain, or if it is less, it realizes a
capital loss. The transaction costs must also be included in
these calculations.

Risks Associated with Futures

There are several risks associated with the use of futures
contracts and futures options. A purchase or sale of a futures
contract may result in losses in excess of the amount invested in
the futures contract. In trying to increase or reduce market
exposure, there can be no guarantee that there will be a
correlation between price movements in the futures contract and in
the portfolio exposure sought. In addition, there are significant
differences between the securities and futures markets that could
result in an imperfect correlation between the markets, causing a
given transaction not to achieve its objectives. The degree of
imperfection of correlation depends on circumstances such as:
variations in speculative market demand for futures, futures
options and the related securities, including technical influences
in futures and futures options trading and differences between the
securities market and the securities underlying the standard
contracts available for trading. For example, in the case of
index futures contracts, the composition of the index, including
the issuers and the weighting of each issue, may differ from the
composition of the investment portfolio, and, in the case of
interest rate futures contracts, the interest rate levels,
maturities, and creditworthiness of the issues underlying the
futures contract may differ from the financial instruments held in
the investment portfolio. A decision as to whether, when and how
to use futures contracts

involves the exercise of skill and judgment, and even a well-
conceived transaction may be unsuccessful to some degree because
of market behavior or unexpected stock price or interest rate
trends.

Futures exchanges may limit the amount of fluctuation
permitted in certain futures contract prices during a single
trading day. The daily limit establishes the maximum amount that
the price of a futures contract may vary either up or down from
the previous day's settlement price at the end of the current
trading session. Once the daily limit has been reached in a
futures contract subject to the limit, no more trades may be made
on that day at a price beyond that limit. The daily limit governs
only price movements during a particular trading day and therefore
does not limit potential losses because the limit may work to
prevent the liquidation of unfavorable positions. For example,
futures prices have occasionally moved to the daily limit for
several consecutive trading days with little or no trading,
thereby preventing prompt liquidation of positions and subjecting
some holders of futures contracts to substantial losses. Stock
index futures contracts are not normally subject to such daily
price change limitations.

There can be no assurance that a liquid market will exist at
a time when the Fund seeks to close out a futures or futures
option position. The Fund would be exposed to possible loss on
the position during the interval of inability to close, and would
continue to be required to meet margin requirements until the
position is closed. In addition, many of the contracts discussed
above are relatively new instruments without a significant trading
history. As a result, there can be no assurance that an active
secondary market will develop or continue to exist.

Limitations on Options and Futures

If other options, futures contracts, or futures options of
types other than those described herein are traded in the future,
the Fund may also use those investment vehicles, provided the
Board of Trustees determines that their use is consistent with the
investment objective.

The Fund will not enter into a futures contract or purchase
an option thereon if, immediately thereafter, the initial margin
deposits for futures contracts held by it plus premiums paid by it
for open futures option positions, less the amount by which any
such positions are "in-the-money,"/3/ would exceed 5% of total
assets.
- -------------------
/3/ A call option is "in-the-money" if the value of the futures
contract that is the subject of the option exceeds the exercise
price. A put option is "in-the-money" if the exercise price
exceeds the value of the futures contract that is the subject of
the option.
- -------------------

When purchasing a futures contract or writing a put option on
a futures contract, the Fund must maintain with its custodian (or
broker, if legally permitted) cash or cash equivalents (including
any margin) equal to the market value of such contract. When
writing a call option on a futures contract, the Fund similarly
will maintain with its custodian cash or cash equivalents
(including any margin) equal to the amount by which such option is
in-the-money until the option expires or is closed out.

The Fund may not maintain open short positions in futures
contracts, call options written on futures contracts or call
options written on indexes if, in the aggregate, the market value
of all such open positions exceeds the current value of the
securities in its portfolio, plus or minus unrealized gains and
losses on the open positions, adjusted for the historical relative
volatility of the relationship between the portfolio and the
positions. For this purpose, to the extent it has written call
options on specific securities in its portfolio, the value of
those securities will be deducted from the current market value of
the securities portfolio.

In order to comply with Commodity Futures Trading Commission
Regulation 4.5 and thereby avoid being deemed a "commodity pool
operator," the Fund will use commodity futures or commodity
options contracts solely for bona fide hedging purposes within the
meaning and intent of Regulation 1.3(z), or, with respect to
positions in commodity futures and commodity options contracts
that do not come within the meaning and intent of 1.3(z), the
aggregate initial margin and premiums required to establish such
positions will not exceed 5% of the fair market value of the
assets of the Fund, after taking into account unrealized profits
and unrealized losses on any such contracts it has entered into
[in the case of an option that is in-the-money at the time of
purchase, the in-the-money amount (as defined in Section 190.01(x)
of the Commission Regulations) may be excluded in computing such
5%].

Taxation of Options and Futures

If the Fund exercises a call or put option that it holds, the
premium paid for the option is added to the cost basis of the
security purchased (call) or deducted from the proceeds of the
security sold (put). For cash settlement options and futures
options exercised by it, the difference between the cash received
at exercise and the premium paid is a capital gain or loss.

If a call or put option written by the Fund is exercised, the
premium is included in the proceeds of the sale of the underlying
security (call) or reduces the cost basis of the security
purchased (put). For cash settlement options and futures options
written by it, the difference between the cash paid at exercise
and the premium received is a capital gain or loss.

Entry into a closing purchase transaction will result in
capital gain or loss. If an option written by the Fund was in-
the-money at the time it was written and the security covering the
option was held for more than the long-term holding period prior
to the writing of the option, any loss realized as a result of a
closing purchase transaction will be long-term. The holding
period of the securities covering an in-the-money option will not
include the period of time the option is outstanding.

If the Fund writes an equity call option/4/ other than a
"qualified covered call option," as defined in the Internal
Revenue Code, any loss on such option transaction, to the extent
it does not exceed the unrealized gains on the securities covering
the option, may be subject to deferral until the securities
covering the option have been sold.
- -------------
/4/ An equity option is defined to mean any option to buy or sell
stock, and any other option the value of which is determined by
reference to an index of stocks of the type that is ineligible to
be traded on a commodity futures exchange (e.g., an option
contract on a sub-index based on the price of nine hotel-casino
stocks). The definition of equity option excludes options on
broad-based stock indexes (such as the Standard & Poor's 500
index).
- -------------

A futures contract held until delivery results in capital
gain or loss equal to the difference between the price at which
the futures contract was entered into and the settlement price on
the earlier of delivery notice date or expiration date. If the
Fund delivers securities under a futures contract, it also
realizes a capital gain or loss on those securities.

For federal income tax purposes, the Fund generally is
required to recognize as income for each taxable year its net
unrealized gains and losses as of the end of the year on futures,
futures options and non-equity options positions ("year-end mark-
to-market"). Generally, any gain or loss recognized with respect
to such positions (either by year-end mark-to-market or by actual
closing of the positions) is considered to be 60% long-term and
40% short-term, without regard to the holding periods of the
contracts. However, in the case of positions classified as part
of a "mixed straddle," the recognition of losses on certain
positions (including options, futures and futures options
positions, the related securities and certain successor positions
thereto) may be deferred to a later taxable year. Sale of futures
contracts or writing of call options (or futures call options) or
buying put options (or futures put options) that are intended to
hedge against a change in the value of securities held: (1) will
affect the holding period of the hedged securities; and (2) may
cause unrealized gain or loss on such securities to be recognized
upon entry into the hedge.

If the Fund were to enter into a short index future, short
index futures option or short index option position and its
portfolio were deemed to "mimic" the performance of the index
underlying such contract, the option or futures contract position
and its stock positions would be deemed to be positions in a mixed
straddle, subject to the above-mentioned loss deferral rules.

In order for the Fund to continue to qualify for federal
income tax treatment as a regulated investment company, at least
90% of its gross income for a taxable year must be derived from
qualifying income; i.e., dividends, interest, income derived from
loans of securities, and gains from the sale of securities or
foreign currencies, or other income (including but not limited to
gains from options, futures, or forward contracts). Any net gain
realized from futures (or futures options) contracts will be
considered gain from the sale of securities and therefore be
qualifying income for purposes of the 90% requirement.

The Fund distributes to shareholders annually any net capital
gains that have been recognized for federal income tax purposes
(including year-end mark-to-market gains) on options and futures
transactions. Such distributions are combined with distributions
of capital gains realized on its other investments, and
shareholders are advised of the nature of the payments.

The Taxpayer Relief Act of 1997 (the "Act") imposed
constructive sale treatment for federal income tax purposes on
certain hedging strategies with respect to appreciated securities.
Under these rules, taxpayers will recognize gain, but not loss,
with respect to securities if they enter into short sales of
"offsetting notional principal contracts" (as defined by the Act)
or futures or "forward contracts" (as defined by the Act) with
respect to the same or substantially identical property, or if
they enter into such transactions and then acquire the same or
substantially identical property. These changes generally apply
to constructive sales after

June 8, 1997. Furthermore, the Secretary of the Treasury is
authorized to promulgate regulations that will treat as
constructive sales certain transactions that have substantially
the same effect as short sales, offsetting notional principal
contracts, and futures or forward contracts to deliver the same or
substantially similar property.

INVESTMENT RESTRICTIONS

The Fund operates under the following investment
restrictions. It may not:

(1) with respect to 75% of its total assets, invest more than
5% of its total assets, taken at market value at the time of a
particular purchase, in the securities of a single issuer, except
for securities issued or guaranteed by the U.S. Government or any
of its agencies or instrumentalities or repurchase agreements for
such securities, and except that all or substantially all of the
assets of the Fund may be invested in another registered
investment company having the same investment objective and
substantially similar investment policies as the Fund;

(2) acquire more than 10%, taken at the time of a particular
purchase, of the outstanding voting securities of any one issuer,
except that all or substantially all of the assets of the Fund may
be invested in another registered investment company having the
same investment objective and substantially similar investment
policies as the Fund;

(3) act as an underwriter of securities, except insofar as it
may be deemed an underwriter for purposes of the Securities Act of
1933 on disposition of securities acquired subject to legal or
contractual restrictions on resale, except that all or
substantially all of the assets of the Fund may be invested in
another registered investment company having the same investment
objective and substantially similar investment policies as the
Fund;

(4) purchase or sell real estate (although it may purchase
securities secured by real estate or interests therein, or
securities issued by companies which invest in real estate or
interests therein), commodities, or commodity contracts, except
that it may enter into (a) futures and options on futures and (b)
forward contracts;

(5) make loans, although it may (a) lend portfolio securities
and participate in an interfund lending program with other Stein
Roe Funds and Portfolios provided that no such loan may be made
if, as a result, the aggregate of such loans would exceed 33 1/3%
of the value of its total assets (taken at market value at the
time of such loans); (b) purchase money market instruments and
enter into repurchase agreements; and (c) acquire publicly
distributed or privately placed debt securities;

(6) borrow except that it may (a) borrow for nonleveraging,
temporary or emergency purposes, (b) engage in reverse repurchase
agreements and make other borrowings, provided that the
combination of (a) and (b) shall not exceed 33 1/3% of the value
of its total assets (including the amount borrowed) less
liabilities (other than borrowings) or such other percentage
permitted by law, and (c) enter into futures and options
transactions; it may borrow from banks, other Stein Roe Funds and
Portfolios, and other persons to the extent permitted by
applicable law;

(7) invest in a security if more than 25% of its total assets
(taken at market value at the time of a particular purchase) would
be invested in the securities of issuers in any particular
industry, except that this restriction does not apply to
securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities, and except that all or
substantially all of the assets of the Fund may be invested in
another registered investment company having the same investment
objective and substantially similar investment policies as the
Fund; or

(8) issue any senior security except to the extent permitted
under the Investment Company Act of 1940.

The above restrictions are fundamental policies and may not
be changed without the approval of a "majority of the outstanding
voting securities" as defined above. The Fund is also subject to
the following nonfundamental restrictions and policies, which may
be changed by the Board of Trustees. None of the following
restrictions shall prevent the Fund from investing all or
substantially all of its assets in another investment company
having the same investment objective and substantially the same
investment policies as the Fund. The Fund may not:

(a) invest in any of the following: (i) interests in oil,
gas, or other mineral leases or exploration or development
programs (except readily marketable securities, including but not
limited to master limited partnership interests, that may
represent indirect interests in oil, gas, or other mineral
exploration or development programs); (ii) puts, calls, straddles,
spreads, or any combination thereof (except that it may enter into
transactions in options, futures, and options on futures); (iii)
shares of other open-end investment companies, except in
connection with a merger, consolidation, acquisition, or
reorganization; and (iv) limited partnerships in real estate
unless they are readily marketable;

(b) invest in companies for the purpose of exercising control
or management;

(c) purchase more than 3% of the stock of another investment
company or purchase stock of other investment companies equal to
more than 5% of its total assets (valued at time of purchase) in
the case of any one other investment company and 10% of such
assets (valued at time of purchase) in the case of all other
investment companies in the aggregate; any such purchases are to
be made in the open market where no profit to a sponsor or dealer
results from the purchase, other than the customary broker's
commission, except for securities acquired as part of a merger,
consolidation or acquisition of assets;

(d) invest more than 5% of its net assets (valued at time of
purchase) in warrants, nor more than 2% of its net assets in
warrants that are not listed on the New York or American Stock
Exchange;

(e) write an option on a security unless the option is issued
by the Options Clearing Corporation, an exchange, or similar
entity;

(f) invest more than 25% of its total assets (valued at time
of purchase) in securities of foreign issuers (other than
securities represented by American Depositary Receipts (ADRs) or
securities guaranteed by a U.S. person);

(g) purchase a put or call option if the aggregate premiums
paid for all put and call options exceed 20% of its net assets
(less the amount by which any such positions are in-the-money),
excluding put and call options purchased as closing transactions;

(h) purchase securities on margin (except for use of short-
term credits as are necessary for the clearance of transactions);

(i) invest more than 5% of its total assets (taken at market
value at the time of a particular investment) in restricted
securities, other than securities eligible for resale pursuant to
Rule 144A under the Securities Act of 1933;

(j) invest more than 15% of its net assets (taken at market
value at the time of a particular investment) in illiquid
securities, including repurchase agreements maturing in more than
seven days.

ADDITIONAL INVESTMENT CONSIDERATIONS

Stein Roe seeks to provide superior long-term investment
results through a disciplined, research-intensive approach to
investment selection and prudent risk management. In working to
take sensible risks and make intelligent investments it has been
guided by three primary objectives which it believes are the
foundation of a successful investment program. These objectives
are preservation of capital, limited volatility through managed
risk, and consistent above-average returns as appropriate for the
particular client or managed account. Because every investor's
needs are different, Stein Roe mutual funds are designed to
accommodate different investment objectives, risk tolerance
levels, and time horizons. In selecting a mutual fund, investors
should ask the following questions:

What are my investment goals?
It is important to a choose a fund that has investment objectives
compatible with your investment goals.

What is my investment time frame?
If you have a short investment time frame (e.g., less than three
years), a mutual fund that seeks to provide a stable share price,
such as a money market fund, or one that seeks capital
preservation as one of its objectives may be appropriate. If you
have a longer investment time frame, you may seek to maximize your
investment returns by investing in a mutual fund that offers
greater yield or appreciation potential in exchange for greater
investment risk.

What is my tolerance for risk?
All investments, including those in mutual funds, have risks which
will vary depending on investment objective and security type.
However, mutual funds seek to reduce risk through professional
investment management and portfolio diversification.

In general, equity mutual funds emphasize long-term capital
appreciation and tend to have more volatile net asset values than
bond or money market mutual funds. Although there is no guarantee
that they will be able to maintain a stable net asset value of
$1.00 per share, money market funds emphasize safety of principal
and liquidity, but tend to offer

lower income potential than bond funds. Bond funds tend to offer
higher income potential than money market funds but tend to have
greater risk of principal and yield volatility.

PURCHASES AND REDEMPTIONS

Purchases Through Third Parties

You may purchase (or redeem) shares through certain broker-
dealers, banks, or other intermediaries ("Intermediaries"). The
state of Texas has asked that investment companies disclose in
their Statements of Additional Information, as a reminder to any
such bank or institution, that it must be registered as a
securities dealer in Texas. Intermediaries may charge for their
services or place limitations on the extent to which you may use
the services offered by the Trust. It is the responsibility of
any such Intermediary to establish procedures insuring the prompt
transmission to the Trust of any such purchase order. An
Intermediary, who accepts orders that are processed at the net
asset value next determined after receipt of the order by the
Intermediary, accepts such orders as authorized agent or designee
of the Fund. The Intermediary is required to segregate any orders
received on a business day after the close of regular session
trading on the New York Stock Exchange and transmit those orders
separately for execution at the net asset value next determined
after that business day.

Some Intermediaries that maintain nominee accounts with the
Fund for their clients for whom they hold Fund shares charge an
annual fee of up to 0.35% of the average net assets held in such
accounts for accounting, servicing, and distribution services they
provide with respect to the underlying Fund shares. Stein Roe and
the Fund's transfer agent share in the expense of these fees, and
Stein Roe pays all sales and promotional expenses.

Net Asset Value

The net asset value of the Fund is determined on days on
which the New York Stock Exchange (the "NYSE") is open for regular
session trading. The NYSE is regularly closed on Saturdays and
Sundays and on New Year's Day, the third Monday in January, the
third Monday in February, Good Friday, the last Monday in May,
Independence Day, Labor Day, Thanksgiving, and Christmas. If one
of these holidays falls on a Saturday or Sunday, the NYSE will be
closed on the preceding Friday or the following Monday,
respectively. Net asset value will not be determined on days when
the NYSE is closed unless, in the judgment of the Board of
Trustees, net asset value of the Fund should be determined on any
such day, in which case the determination will be made at 3 p.m.,
Central time. Please refer to Your Account-Determining Share
Price in the Prospectus for additional information on how the
purchase and redemption price of Fund shares is determined.

General Redemption Policies

The Trust intends to pay all redemptions in cash and is
obligated to redeem shares solely in cash up to the lesser of
$250,000 or one percent of the net assets during any 90-day period
for any one shareholder. However, redemptions in excess of such
limit may be paid wholly or partly by a distribution in kind of
securities. If redemptions were made in kind, the redeeming
shareholders might incur transaction costs in selling the
securities received in the redemptions.

The Trust reserves the right to suspend or postpone
redemptions of shares during any period when: (a) trading on the
NYSE is restricted, as determined by the Securities and Exchange
Commission, or the NYSE is closed for other than customary weekend
and holiday closings; (b) the Securities and Exchange Commission
has by order permitted such suspension; or (c) an emergency, as
determined by the Securities and Exchange Commission, exists,
making disposal of portfolio securities or valuation of net assets
not reasonably practicable.

You may not cancel or revoke your redemption order once
instructions have been received and accepted. The Trust cannot
accept a redemption request that specifies a particular date or
price for redemption or any special conditions. Please call 800-
338-2550 if you have any questions about requirements for a
redemption before submitting your request. The Trust reserves the
right to require a properly completed application before making
payment for shares redeemed.

The Trust will generally mail payment for shares redeemed
within seven days after proper instructions are received.
However, the Trust normally intends to pay proceeds of a Telephone
Redemption paid by wire on the next business day. If you attempt
to redeem shares within 15 days after they have been purchased by
check or electronic transfer, the Trust will delay payment of the
redemption proceeds to you until it can verify that payment for
the purchase of those shares has been (or will be) collected. To
reduce such delays, the Trust recommends that your purchase be
made by federal funds wire through your bank.

Generally, you may not use any Special Redemption Privilege
to redeem shares purchased by check (other than certified or
cashiers' checks) or electronic transfer until 15 days after their
date of purchase. The Trust reserves the right at any time
without prior notice to suspend, limit, modify, or terminate any
Privilege or its use in any manner by any person or class.

Neither the Trust, its transfer agent, nor their respective
officers, trustees, directors, employees, or agents will be
responsible for the authenticity of instructions provided under
the Privileges, nor for any loss, liability, cost or expense for
acting upon instructions furnished thereunder if they reasonably
believe that such instructions are genuine. The Fund employs
procedures reasonably designed to confirm that instructions
communicated by telephone under any Special Redemption Privilege
or the Special Electronic Transfer Redemption Privilege are
genuine. Use of any Special Redemption Privilege or the Special
Electronic Transfer Redemption Privilege authorizes the Fund and
its transfer agent to tape-record all instructions to redeem. In
addition, callers are asked to identify the account number and
registration, and may be required to provide other forms of
identification. Written confirmations of transactions are mailed
promptly to the registered address; a legend on the confirmation
requests that the shareholder review the transactions and inform
the Fund immediately if there is a problem. If the Fund does not
follow reasonable procedures for protecting shareholders against
loss on telephone transactions, it may be liable for any losses
due to unauthorized or fraudulent instructions.

Shares in any account you maintain with the Fund or any of
the other Stein Roe Funds may be redeemed to the extent necessary
to reimburse any Stein Roe Fund for any loss

you cause it to sustain (such as loss from an uncollected check or
electronic transfer for the purchase of shares, or any liability
under the Internal Revenue Code provisions on backup withholding).

The Trust reserves the right to suspend or terminate, at any
time and without prior notice, the use of the Telephone Exchange
Privilege by any person or class of persons. The Trust believes
that use of the Telephone Exchange Privilege by investors
utilizing market-timing strategies adversely affects the Fund.
Therefore, regardless of the number of telephone exchange round-
trips made by an investor, the Trust generally will not honor
requests for Telephone Exchanges by shareholders identified by the
Trust as "market-timers" if the officers of the Trust determine
the order not to be in the best interests of the Trust or its
shareholders. The Trust generally identifies as a "market-timer"
an investor whose investment decisions appear to be based on
actual or anticipated near-term changes in the securities markets
other than for investment considerations. Moreover, the Trust
reserves the right to suspend, limit, modify, or terminate, at any
time and without prior notice, the Telephone Exchange Privilege in
its entirety. Because such a step would be taken only if the
Board of Trustees believes it would be in the best interests of
the Fund, the Trust expects that it would provide shareholders
with prior written notice of any such action unless the resulting
delay in the suspension, limitation, modification, or termination
of the Telephone Exchange Privilege would adversely affect the
Fund. If the Trust were to suspend, limit, modify, or terminate
the Telephone Exchange Privilege, a shareholder expecting to make
a Telephone Exchange might find that an exchange could not be
processed or that there might be a delay in the implementation of
the exchange. During periods of volatile economic and market
conditions, you may have difficulty placing your exchange by
telephone.

The Telephone Exchange Privilege and the Telephone Redemption
by Check Privilege will be established automatically for you when
you open your account unless you decline these Privileges on your
application. Other Privileges must be specifically elected. A
signature guarantee may be required to establish a Privilege after
you open your account. If you establish both the Telephone
Redemption by Wire Privilege and the Electronic Transfer
Privilege, the bank account that you designate for both Privileges
must be the same. The Telephone Redemption by Check Privilege,
Telephone Redemption by Wire Privilege, and Special Electronic
Transfer Redemptions may not be used to redeem shares held by a
tax-sheltered retirement plan sponsored by Stein Roe.

Redemption Privileges

Exchange Privilege. You may redeem all or any portion of
your Fund shares and use the proceeds to purchase shares of any
other no-load Stein Roe Fund offered for sale in your state if
your signed, properly completed application is on file. An
exchange transaction is a sale and purchase of shares for federal
income tax purposes and may result in capital gain or loss.
Before exercising the Exchange Privilege, you should obtain the
prospectus for the no-load Stein Roe Fund in which you wish to
invest and read it carefully. The registration of the account to
which you are making an exchange must be exactly the same as that
of the Fund account from which the exchange is made and the amount
you exchange must meet any applicable minimum investment of the
no-load Stein Roe Fund being purchased.

Telephone Exchange Privilege. You may use the Telephone
Exchange Privilege to exchange an amount of $50 or more from your
account by calling 800-338-2550 or by sending a telegram; new
accounts opened by exchange are subject to the $2,500 initial
purchase minimum. Generally, you will be limited to four
Telephone Exchange round-trips per year and the Fund may refuse
requests for Telephone Exchanges in excess of four round-trips (a
round-trip being the exchange out of the Fund into another no-load
Stein Roe Fund, and then back to the Fund). In addition, the
Trust's general redemption policies apply to redemptions of shares
by Telephone Exchange.

Automatic Exchanges. You may use the Automatic Exchange
Privilege to automatically redeem a fixed amount from your Fund
account for investment in another no-load Stein Roe Fund account
on a regular basis ($50 minimum; $100,000 maximum).

Telephone Redemption by Wire Privilege. You may use this
Privilege to redeem shares from your account ($1,000 minimum;
$100,000 maximum) by calling 800-338-2550. The proceeds will be
transmitted by wire to your account at a commercial bank
previously designated by you that is a member of the Federal
Reserve System. The fee for wiring proceeds (currently $7.00 per
transaction) will be deducted from the amount wired.

Telephone Redemption by Check Privilege. You may use the
Telephone Redemption by Check Privilege to redeem an amount of
$1,000 or more from your account by calling 800-338-2550. The
proceeds will be sent by check to your registered address.

Electronic Transfer Privilege. You may redeem shares by
calling 800-338-2550 and requesting an electronic transfer
("Special Redemption") of the proceeds to a bank account
previously designated by you at a bank that is a member of the
Automated Clearing House. You may also request electronic
transfers at scheduled intervals ("Automatic Redemptions"). A
Special Redemption request received by telephone after 3 p.m.,
central time, is deemed received on the next business day. You
may purchase Fund shares directly from your bank account either at
regular intervals ("Regular Investments") or upon your request
("Special Investments"). Electronic transfers are subject to a
$50 minimum and a $100,000 maximum. You may also have income
dividends and capital gains distributions deposited directly into
your bank account ("Automatic Dividend Deposits").

Systematic Withdrawals. You may have a fixed dollar amount,
declining balance, or fixed percentage of your account redeemed
and sent at regular intervals by check to you or another payee.

Dividend Purchase Option. You may have distributions from
one Fund account automatically invested in another no-load Stein
Roe Fund account. Before establishing this option, you should
obtain and read the prospectus of the Stein Roe Fund into which
you wish to have your distributions invested. The account from
which distributions are made must be of sufficient size to allow
each distribution to usually be at least $25.

MANAGEMENT

The Board of Trustees of the Trust has overall management
responsibility for the Trust and the Fund. The following table
sets forth certain information with respect to the trustees and
officers of the Trust:

<TABLE>
<CAPTION>
Position(s) held Principal occupation(s)
Name with the Trust during past five years
- ------------------ ------------------------ -----------------------------------
<S> <C> <C>

William D. Andrews, 52 Executive Vice-President Executive vice president of Stein
Roe

Gary A. Anetsberger, 43 Senior Vice-President; Chief financial officer and chief
Treasurer administrative officer of the Mutual
Funds division of Stein Roe; senior
vice president of Stein Roe since
April 1996; vice president of Stein
Roe prior thereto

John A. Bacon Jr., 71 (3) Trustee Private investor

William W. Boyd, 72 (2)(3) Trustee Chairman and director of Sterling
Plumbing (manufacturer of plumbing
products)

David P. Brady, 35 Vice-President Senior vice president of Stein Roe
since March 1998; vice president of
Stein Roe from Nov. 1995 to March
1998; portfolio manager for Stein
Roe since 1993

Thomas W. Butch, 42 President President of the Mutual Funds
division of Stein Roe since March
1998; senior vice president of Stein
Roe from Sept. 1994 to March 1998;
first vice president, corporate
communications, of Mellon Bank
Corporation prior thereto

Daniel K. Cantor, 40 Vice-President Senior vice president of Stein Roe

Kevin M. Carome, 43 Executive Vice-President; Senior vice president, legal,
Assistant Secretary Liberty Funds Group LLC (an
affiliate of Stein Roe) since Jan.
1999; general counsel and secretary
of Stein Roe since Jan. 1998;
associate general counsel and vice
president of Liberty Financial
Companies, Inc. (the indirect parent
of Stein Roe) through Jan. 1999

J. Kevin Connaughton, 35 Vice-President Vice president of Colonial
Management Associates, Inc. ("CMA"),
since February 1998; senior tax
manager, Coopers & Lybrand, LLP from
April 1996 to January 1998; vice
president, 440 Financial Group/First
Data Investor Services Group prior
thereto

Lindsay Cook, 47 (1)(2) Trustee Executive vice president of Liberty
Financial Companies, Inc. since
March 1997; senior vice president
prior thereto

Erik P. Gustafson, 36 Vice-President Senior portfolio manager of Stein
Roe; senior vice president of Stein
Roe since April 1996; vice president
of Stein Roe prior thereto

Douglas A. Hacker, 43 (3) Trustee Senior vice president and chief
financial officer of UAL, Inc.
(airline)

Loren A. Hansen, 51 Executive Vice-President Chief investment officer of CMA
("CMA") since 1997; executive vice
president of Stein Roe since Dec.
1995; vice president of The Northern
Trust (bank) prior thereto

James P. Haynie, 36 Vice-President Vice President of Stein Roe since
Oct. 1998; Vice President of CMA

Harvey B. Hirschhorn, 49 Vice-President Executive vice president, senior
portfolio manager, and chief
economist and investment strategist
of Stein Roe; director of research
of Stein Roe, 1991 to 1995

Timothy J. Jacoby, 47 Vice-President Fund treasurer for The Colonial
Group since Sept. 1996 and chief
financial officer since Aug. 1997;
senior vice president of Fidelity
Investments prior thereto

Patricia J. Judge, 28 Controller Assistant vice president of Fund
accounting for Stein Roe since March
1999; deputy treasurer for the
Chicago Board of Education from
August 1995 to Feb. 1999; senior
auditor for Arthur Andersen LLP
prior thereto

Janet Langford Kelly, 41 Trustee Senior vice president, secretary and
(3) general counsel of Sara Lee
Corporation (branded, packaged,
consumer-products manufacturer)
since 1995; partner of Sidley &
Austin (law firm) prior thereto

Michael T. Kennedy, 37 Vice-President Senior vice president of Stein Roe

Gail D. Knudsen, 37 Vice-President Vice president and assistant
controller of CMA

Stephen F. Lockman, 37 Vice-President Senior vice president, portfolio
manager, and credit analyst of Stein
Roe

Lynn C. Maddox, 58 Vice-President Senior vice president of Stein Roe

Arthur J. McQueen, 41 Vice-President Senior vice president of Stein Roe

Charles R. Nelson, 57 (3) Trustee Van Voorhis Professor of Political
Economy, Department of Economics of
the University of Washington

Maureen G. Newman, 40 Vice-President Vice President of Stein Roe since
Nov. 1998; portfolio manager and
vice president of CMA since May
1996; portfolio manager and bond
analyst at Fidelity Investments from
May 1985 to May 1996

Nicolette D. Parrish, 49 Vice-President; Senior legal assistant and assistant
Assistant Secretary secretary of Stein Roe

Gita R. Rao, 39 Vice-President Vice President of Stein Roe since
Oct. 1998; vice president and
portfolio manager for CMA since
1995; global equity research analyst
at Fidelity Management & Research
Company prior thereto

Michael E. Rega, 39 Vice-President Vice President of Stein Roe since
Oct. 1998; Vice President of CMA
since 1996

Janet B. Rysz, 43 Assistant Secretary Senior legal assistant and assistant
secretary of Stein Roe

Thomas C. Theobald, 62 (3) Trustee Managing director, William Blair
Capital Partners (private equity
fund)

Sharlene A. Thomas, 37 Vice-President Assistant vice president of mutual
fund sales & service of Stein Roe
since Feb. 1999; manager of mutual
fund sales & services of Stein Roe
from March 1997 to Feb. 1999;
account executive with Stein Roe's
Counselor department prior thereto

Heidi J. Walter, 32 Vice-President; Secretary Vice president of Stein Roe since
March 1998; senior legal counsel for
Stein Roe since Feb. 1998; legal
counsel for Stein Roe from March
1995 to Jan. 1998; associate with
Beeler Schad & Diamond, PC (law
firm) prior thereto

<FN>
_________________________
(1) Trustee who is an "interested person" of the Trust and of
Stein Roe, as defined in the Investment Company Act of 1940.
(2) Member of the Executive Committee of the Board of Trustees,
which is authorized to exercise all powers of the Board with
certain statutory exceptions.
(3) Member of the Audit Committee of the Board, which makes
recommendations to the Board regarding the selection of
auditors and confers with the auditors regarding the scope and
results of the audit.
</TABLE>

Certain of the trustees and officers of the Trust are
trustees or officers of other investment companies managed by
Stein Roe. Mr. Anetsberger, Mr. Butch, and Ms. Walter are also
officers of Liberty Funds Distributor, Inc., the Fund's
distributor. The address of Mr. Bacon is 4N640 Honey Hill Road,
Box 296, Wayne, IL 60184; that of Mr. Boyd is 2900 Golf Road,
Rolling Meadows, IL 60008; that of Mr. Cook is 600 Atlantic
Avenue, Boston, MA 02210; that of Mr. Hacker is P.O. Box 66100,
Chicago, IL 60666; that of Ms. Kelly is Three First National
Plaza, Chicago, IL 60602; that of Mr. Nelson is Department of
Economics, University of Washington, Seattle, WA 98195; that of
Mr. Theobald is Suite 3300, 222 West Adams Street, Chicago, IL
60606; that of Mr. Cantor is 1330 Avenue of the Americas, New
York, NY 10019; that of Ms. Knudsen, Ms. Newman, Ms. Rao, and
Messrs. Connaughton, Haynie, Jacoby, and Rega is One Financial
Center, Boston, MA 02111; and that of the other officers is One
South Wacker Drive, Chicago, IL 60606.

Officers and trustees affiliated with Stein Roe serve without
any compensation from the Trust. In compensation for their
services to the Trust, trustees who are not "interested persons"
of the Trust or Stein Roe are paid an annual retainer plus an
attendance fee for each meeting of the Board or standing committee
thereof attended. The Trust has no retirement or pension plan.
The following table sets forth compensation paid during the fiscal
year ended Sept. 30, 1998 to each of the trustees:

Compensation from the
Stein Roe Fund Complex*
-----------------------
Aggregate Compensation Total Average
Name of Trustee from the Trust Compensation Per Series
- ------------------- -------------------- ------------ ----------
Timothy K. Armour** -0- -0- -0-
Thomas W. Butch** -0- -0- -0-
Lindsay Cook -0- -0- -0-
John A. Bacon Jr.** -0- -0- -0-
Kenneth L. Block** $ 3,800 $ 23,100 $ 525
William W. Boyd 21,700 109,902 2,498
Douglas A. Hacker 19,050 101,148 2,299
Janet Langford Kelly 19,050 97,950 2,226
Francis W. Morley** 3,800 23,100 525
Charles R. Nelson 21,700 109,552 2,490
Thomas C. Theobald 19,050 101,148 2,299
_______________
* At Sept. 30, 1998, the Stein Roe Fund Complex consisted of 10
series of the Trust, 11 series of Stein Roe Investment Trust,
four series of Stein Roe Income Trust, four series of Stein Roe
Municipal Trust, one series of Stein Roe Institutional Trust,
one series of Stein Roe Trust, and 13 series of SR&F Base Trust.
**Messrs. Block and Morley retired as trustees on Dec. 31, 1997.
Mr. Armour resigned as a trustee on April 14, 1998. Mr. Butch
served as a trustee from April 14, 1998 to Nov. 3, 1998. Mr.
Bacon was elected a trustee effective Nov. 3, 1998.

PRINCIPAL SHAREHOLDERS

As of the date of this SAI, the Fund had no outstanding
shares.

INVESTMENT ADVISORY AND OTHER SERVICES

Stein Roe & Farnham Incorporated provides investment
management services and administrative services to the Fund.
Stein Roe is a wholly owned subsidiary of SteinRoe Services Inc.
("SSI"), the Fund's transfer agent, which is a wholly owned
subsidiary of Liberty Financial Companies, Inc. ("Liberty
Financial"), which is a majority owned subsidiary of Liberty
Corporate Holdings, Inc., which is a wholly owned subsidiary of
LFC Holdings, Inc., which is a wholly owned subsidiary of Liberty
Mutual Equity Corporation, which is a wholly owned subsidiary of
Liberty Mutual Insurance Company. Liberty Mutual Insurance
Company is a mutual insurance company, principally in the
property/casualty insurance field, organized under the laws of
Massachusetts in 1912.

The directors of Stein Roe are Kenneth R. Leibler, C. Allen
Merritt, Jr., and Thomas W. Butch. Mr. Leibler is President and
Chief Executive Officer of Liberty Financial; Mr. Merritt is Chief
Operating Officer of Liberty Financial; and Mr. Butch is President
of Stein Roe's Mutual Funds division. The business address of
Messrs. Leibler and Merritt is 600 Atlantic Avenue, Federal
Reserve Plaza, Boston, MA 02210; and that of Mr. Butch is One
South Wacker Drive, Chicago, IL 60606.

Stein Roe and its predecessor have been providing investment
advisory services since 1932. Stein Roe acts as investment
adviser to wealthy individuals, trustees, pension and profit
sharing plans, charitable organizations, and other institutional
investors. As of Sept. 30, 1998, Stein Roe managed over $28.3
billion in assets: over $9.4 billion in equities and over $18.9
billion in fixed income securities (including $1.1 billion in
municipal securities). The $28.3 billion in managed assets
included over $8.3 billion held by open-end mutual funds managed
by Stein Roe (approximately 14% of the mutual fund assets were
held by clients of Stein Roe). These mutual funds were owned by
over 295,000 shareholders. The $8.3 billion in mutual fund assets
included over $637 million in over 43,000 IRA accounts. In
managing those assets, Stein Roe utilizes a proprietary computer-
based information system that maintains and regularly updates
information for approximately 7,500 companies. Stein Roe also
monitors over 1,400 issues via a proprietary credit analysis
system. At Sept. 30, 1998, Stein Roe employed 18 research
analysts and 55 account managers. The average investment-related
experience of these individuals was 17 years.

Stein Roe Counselor [service mark] and Stein Roe Personal
Counselor [service mark] are professional investment advisory
services offered to Fund shareholders. Each is designed to help
shareholders construct Fund investment portfolios to suit their
individual needs. Based on information shareholders provide about
their financial circumstances, goals, and objectives in response
to a questionnaire, Stein Roe's investment professionals create
customized portfolio recommendations for investments in the mutual
funds managed by Stein Roe. Shareholders participating in Stein
Roe Counselor [service mark] are free to self direct their
investments while considering Stein Roe's recommendations;
shareholders participating in Stein Roe Personal Counselor
[service mark] enjoy the added benefit of having Stein Roe
implement portfolio recommendations automatically for a fee of 1%
or less, depending on the size of their portfolios. In addition
to reviewing shareholders' circumstances, goals, and objectives
periodically and updating portfolio recommendations to reflect any
changes, the shareholders who participate in these programs are
assigned a dedicated Counselor [service mark] representative.
Other distinctive services include specially designed account
statements with portfolio performance and transaction data,
newsletters, and regular investment, economic, and market updates.
A $50,000 minimum investment is required to participate in either
program.

In return for its services, Stein Roe is entitled to receive
from the Fund a monthly administrative fee at an annual rate of
0.15% of average net assets and a monthly management fee at an
annual rate of 0.85% of average net assets.

Stein Roe provides office space and executive and other
personnel to the Fund, and bears any sales or promotional
expenses. The Fund pays all expenses other than those paid by
Stein Roe, including but not limited to printing and postage
charges, securities registration and custodian fees, and expenses
incidental to its organization.

The administrative agreement provides that Stein Roe shall
reimburse the Fund to the extent that its total annual expenses
(including fees paid to Stein Roe, but excluding taxes, interest,
commissions and other normal charges incident to the purchase and
sale of portfolio securities, and expenses of litigation to the
extent permitted under applicable state law) exceed the applicable
limits prescribed by any state in which its shares are being
offered for sale to the public; provided, however, Stein Roe is
not required to reimburse the Fund an

amount in excess of fees paid by the Fund under that agreement for
such year. In addition, in the interest of further limiting
expenses of the Fund, Stein Roe may voluntarily waive its fees
and/or absorb certain expenses, as described under The Fund-Your
Expenses in the Prospectus. Any such reimbursement will enhance
the yield of the Fund.

The management agreement provides that neither Stein Roe, nor
any of its directors, officers, stockholders (or partners of
stockholders), agents, or employees shall have any liability to
the Trust or any shareholder of the Trust for any error of
judgment, mistake of law or any loss arising out of any
investment, or for any other act or omission in the performance by
Stein Roe of its duties under the agreement, except for liability
resulting from willful misfeasance, bad faith or gross negligence
on its part in the performance of its duties or from reckless
disregard by it of its obligations and duties under the agreement.

Any expenses that are attributable solely to the
organization, operation, or business of the Fund are paid solely
out of its assets. Any expenses incurred by the Trust that are
not solely attributable to a particular series are apportioned in
such manner as Stein Roe determines is fair and appropriate,
unless otherwise specified by the Board of Trustees.

Bookkeeping and Accounting Agreement

Pursuant to a separate agreement with the Trust, Stein Roe
receives a fee for performing certain bookkeeping and accounting
services. For services provided to the Trust, Stein Roe receives
an annual fee of $25,000 per Fund plus .0025 of 1% of average net
assets over $50 million. During the fiscal years ended Sept. 30,
1997 and 1998, Stein Roe received $109,375 and $224,068,
respectively, from the Trust for services provided under this
agreement.

DISTRIBUTOR

Shares of the Fund are distributed by Liberty Funds
Distributor, Inc. (the "Distributor"), One Financial Center,
Boston, MA 02111, an indirect subsidiary of Liberty Financial,
under a Distribution Agreement. The Distribution Agreement
continues in effect from year to year, provided such continuance
is approved annually (i) by a majority of the trustees or by a
majority of the outstanding voting securities of the Trust, and
(ii) by a majority of the trustees who are not parties to the
Agreement or interested persons of any such party ("independent
trustees"). The Distributor has no obligation, as underwriter, to
buy Fund shares, and purchases shares only upon receipt of orders
from authorized financial service firms or investors. The Trust
has agreed to pay all expenses in connection with registration of
its shares with the Securities and Exchange Commission and
auditing and filing fees in connection with registration of its
shares under the various state blue sky laws and assumes the cost
of preparation of prospectuses and other expenses.

The Fund's shares are offered at net asset value, subject to
a Rule 12b-1 fee.

The trustees of the Trust have adopted a plan pursuant to
Rule 12b-1 under the Investment Company Act of 1940 (the "Plan").
The Plan provides that, as compensation for personal service
and/or the maintenance of shareholder accounts, the Distributor
receives a

service fee at an annual rate not to exceed 0.25% of
net assets attributed to each class of shares other than Class K
shares. For series of the Trust, such as the Fund, that are not
in a multi-class structure, the Distributor receives a
distribution or service fee at an annual rate not to exceed 0.25%
of the net assets attributed to such series. The Plan also
provides that as compensation for the promotion and distribution
of shares of the series of the Trust including its expenses
related to sale and promotion of Fund shares, the Distributor
receives from each series a fee at an annual rate not exceeding
0.10% of the average net assets attributed to Class A shares, and
0.75% of the average net assets attributed to each of its Class B
and Class C shares. The Plan further provides that, as
compensation for services and/or distribution, the Distributor
receives a fee at an annual rate not to exceed 0.25% of the
average net assets attributable to Class K shares. At this time,
the Distributor has voluntarily agreed to limit the Class A
distribution fee to 0.05% annually. The Distributor may terminate
this voluntary limitation without shareholder approval. Class B
shares automatically convert to Class A shares approximately eight
years after the Class B shares are purchased. Class C and Class K
shares do not convert. The Distributor generally pays this amount
to institutions that distribute Fund shares and provide services
to the Fund and its shareholders. Those institutions may use the
payments for, among other purposes, compensating employees engaged
in sales and/or shareholder servicing. The amount of fees paid by
the Fund during any year may be more or less than the cost of
distribution or other services provided to the Fund. NASD rules
limit the amount of annual distribution fees that may be paid by a
mutual fund and impose a ceiling on the cumulative sales charges
paid. The Trust's Plan complies with those rules.

The trustees believe that the Plan could be a significant
factor in the growth and retention of Fund assets resulting in a
more advantageous expense ratio and increased investment
flexibility which could benefit each class of shareholders. The
Plan will continue in effect from year to year so long as
continuance is specifically approved at least annually by a vote
of the trustees, including the independent trustees. The Plan may
not be amended to increase the fee materially without approval by
a vote of a majority of the outstanding voting securities of the
relevant class of shares and all material amendments of the Plan
must be approved by the trustees in the manner provided in the
foregoing sentence. The Plan may be terminated at any time by a
vote of a majority of the independent trustees or by a vote of a
majority of the outstanding voting securities of the relevant
Class of shares.

TRANSFER AGENT

Liberty Funds Services, Inc. (the "Transfer Agent"), P.O. Box
1722, Boston, MA 02105, an indirect subsidiary of Liberty
Financial, is the agent of the Trust for the transfer of shares,
disbursement of dividends, and maintenance of shareholder
accounting records. For performing these services, the Transfer
Agent receives from the Fund a fee based on an annual rate of .25
of 1% of average net assets. The Trust believes the charges by
SSI to the Fund are comparable to those of other companies
performing similar services. (See Investment Advisory and Other
Services.)

Some intermediaries having special selling arrangements with
the Distributor, including certain broker-dealers, bank trust
departments, asset allocation programs sponsored by Stein Roe,
wrap fee programs, and retirement plan service providers
("Intermediaries")

that maintain nominee accounts with the Fund for their clients who
are Fund shareholders, may be paid a fee from the Transfer Agent
for shareholder servicing and accounting services they provide
with respect to the underlying Fund shares.

CUSTODIAN

State Street Bank and Trust Company (the "Bank"), 225
Franklin Street, Boston, MA 02101, is the custodian for the Trust.
It is responsible for holding all securities and cash, receiving
and paying for securities purchased, delivering against payment
securities sold, receiving and collecting income from investments,
making all payments covering expenses, and performing other
administrative duties, all as directed by authorized persons. The
Bank does not exercise any supervisory function in such matters as
purchase and sale of portfolio securities, payment of dividends,
or payment of expenses.

Portfolio securities purchased in the U.S. are maintained in
the custody of the Bank or of other domestic banks or
depositories. Portfolio securities purchased outside of the U.S.
are maintained in the custody of foreign banks and trust companies
that are members of the Bank's Global Custody Network and foreign
depositories ("foreign sub-custodians"). Each of the domestic and
foreign custodial institutions holding portfolio securities has
been approved by the Board of Trustees in accordance with
regulations under the Investment Company Act of 1940.

Each Board of Trustees reviews, at least annually, whether it
is in the best interests of the Fund and its shareholders to
maintain assets in each of the countries in which the Fund invests
with particular foreign sub-custodians in such countries, pursuant
to contracts between such respective foreign sub-custodians and
the Bank. The review includes an assessment of the risks of
holding assets in any such country (including risks of
expropriation or imposition of exchange controls), the operational
capability and reliability of each such foreign sub-custodian, and
the impact of local laws on each such custody arrangement. Each
Board of Trustees is aided in its review by the Bank, which has
assembled the network of foreign sub-custodians, as well as by
Stein Roe and counsel. However, with respect to foreign sub-
custodians, there can be no assurance that the Fund, and the value
of its shares, will not be adversely affected by acts of foreign
governments, financial or operational difficulties of the foreign
sub-custodians, difficulties and costs of obtaining jurisdiction
over or enforcing judgments against the foreign sub-custodians, or
application of foreign law to the foreign sub-custodial
arrangements. Accordingly, an investor should recognize that the
non-investment risks involved in holding assets abroad are greater
than those associated with investing in the United States.

The Fund may invest in obligations of the Bank and may
purchase or sell securities from or to the Bank.

INDEPENDENT PUBLIC ACCOUNTANTS

The independent public accountants for the Fund are Arthur
Andersen LLP, 33 West Monroe Street, Chicago, IL 60603. The
accountants audit and report on the annual financial statements,
review certain regulatory reports and the federal income tax
returns, and

perform other professional accounting, auditing, tax
and advisory services when engaged to do so by the Trust.

PORTFOLIO TRANSACTIONS

Stein Roe places the orders for the purchase and sale of
portfolio securities and options and futures contracts for its
clients, including private clients and mutual fund clients
("Clients"). Stein Roe's overriding objective in selecting
brokers and dealers to effect portfolio transactions is to seek
the best combination of net price and execution. The best net
price, giving effect to brokerage commissions, if any, is an
important factor in this decision; however, a number of other
judgmental factors may also enter into the decision. These
factors include Stein Roe's knowledge of negotiated commission
rates currently available and other current transaction costs; the
nature of the security being purchased or sold; the size of the
transaction; the desired timing of the transaction; the activity
existing and expected in the market for the particular security;
confidentiality; the execution, clearance and settlement
capabilities of the broker or dealer selected and others
considered; Stein Roe's knowledge of the financial condition of
the broker or dealer selected and such other brokers and dealers;
and Stein Roe's knowledge of actual or apparent operation problems
of any broker or dealer.

Recognizing the value of these factors, Stein Roe may cause a
Client to pay a brokerage commission in excess of that which
another broker may have charged for effecting the same
transaction. Stein Roe has established internal policies for the
guidance of its trading personnel, specifying minimum and maximum
commissions to be paid for various types and sizes of transactions
and effected for Clients in those cases where Stein Roe has
discretion to select the broker or dealer by which the transaction
is to be executed. Stein Roe has discretion for all trades of the
Fund. Transactions which vary from the guidelines are subject to
periodic supervisory review. These guidelines are reviewed and
periodically adjusted, and the general level of brokerage
commissions paid is periodically reviewed by Stein Roe.
Evaluations of the reasonableness of brokerage commissions, based
on the factors described in the preceding paragraph, are made by
Stein Roe's trading personnel while effecting portfolio
transactions. The general level of brokerage commissions paid is
reviewed by Stein Roe, and reports are made annually to the Board
of Trustees.

Stein Roe maintains and periodically updates a list of
approved brokers and dealers which, in Stein Roe's judgment, are
generally capable of providing best price and execution and are
financially stable. Stein Roe's traders are directed to use only
brokers and dealers on the approved list, except in the case of
Client designations of brokers or dealers to effect transactions
for such Clients' accounts. Stein Roe generally posts certain
Client information on the "Alert" broker database system as a
means of facilitating the trade affirmation and settlement
process.

It is Stein Roe's practice, when feasible, to aggregate for
execution as a single transaction orders for the purchase or sale
of a particular security for the accounts of several Clients, in
order to seek a lower commission or more advantageous net price.
The benefit, if any, obtained as a result of such aggregation
generally is allocated pro rata among the accounts of Clients
which participated in the aggregated transaction. In some
instances, this may involve the use of an "average price"
execution wherein a broker or dealer to which the aggregated

order has been given will execute the order in several separate
transactions during the course of a day at differing prices and,
in such case, each Client participating in the aggregated order
will pay or receive the same price and commission, which will be
an average of the prices and commissions for the several separate
transactions executed by the broker or dealer.

Stein Roe sometimes makes use of an indirect electronic
access to the New York Stock Exchange's "SuperDOT" automated
execution system, provided through a NYSE member floor broker, W&D
Securities, Inc., a subsidiary of Jeffries & Co., Inc.,
particularly for the efficient execution of smaller orders in NYSE
listed equities. Stein Roe sometimes uses similar arrangements
through Billings & Co., Inc. and Driscoll & Co., Inc., floor
broker members of the Chicago Stock Exchange, for transactions to
be executed on that exchange. In using these arrangements, Stein
Roe must instruct the floor broker to refer the executed
transaction to another brokerage firm for clearance and
settlement, as the floor brokers do not deal with the public.
Transactions of this type sometimes are referred to as "step-in"
or "step-out" transactions. The brokerage firm to which the
executed transaction is referred may include, in the case of
transactions effected through W&D Securities, brokerage firms
which provide Stein Roe investment research or related services.

Stein Roe places certain trades for the Fund through its
affiliate AlphaTrade, Inc. ("ATI"). ATI is a wholly owned
subsidiary of Colonial Management Associates, Inc. ATI is a fully
disclosed introducing broker that limits its activities to
electronic execution of transactions in listed equity securities.
The Fund pays ATI a commission for these transactions. The Fund
has adopted procedures consistent with Investment Company Act Rule
17e-1 governing such transactions. Certain of Stein Roe's
officers also serve as officers, directors and/or employees of
ATI.

Consistent with the Rules of Fair Practice of National
Securities Dealers, Inc. and subject to seeking best executing and
such other policies as the trustees of the Fund may determine,
Stein Roe may consider sales of shares the Fund as a factor in the
selection of broker-dealers to execute such mutual fund securities
transactions.

Investment Research Products and Services Furnished by Brokers and
Dealers

Stein Roe engages in the long-standing practice in the money
management industry of acquiring research and brokerage products
and services ("research products") from broker-dealer firms in
return directing trades for Client accounts to those firms. In
effect, Stein Roe is using the commission dollars generated from
these Client accounts to pay for these research products. The
money management industry uses the term "soft dollars" to refer to
this industry practice. Stein Roe may engage in soft dollar
transactions on trades for those Client accounts for which Stein
Roe has the discretion to select the brokers-dealer.

The ability to direct brokerage for a Client account belongs
to the Client and not to Stein Roe. When a Client grants Stein
Roe the discretion to select broker-dealers for Client trades,
Stein Roe has a duty to seek the best combination of net price and
execution. Stein Roe faces a potential conflict of interest with
this duty when it uses Client trades to obtain soft dollar
products. This conflict exists because Stein Roe is able to use
the soft dollar

products in managing its Client accounts without paying cash
("hard dollars") for the product. This reduces Stein Roe's
expenses.

Moreover, under a provision of the federal securities laws
applicable to soft dollars, Stein Roe is not required to use the
soft dollar product in managing those accounts that generate the
trade. Thus, the Client accounts that generate the brokerage
commission used to acquire the soft dollar product may not benefit
directly from that product. In effect, those accounts are cross
subsidizing Stein Roe's management of the other accounts that do
benefit directly from the product. This practice is explicitly
sanctioned by a provision of the Securities Exchange Act of 1934,
which creates a "safe harbor" for soft dollar transactions
conducted in a specified manner. Although it is inherently
difficult, if not impossible, to document, Stein Roe believes that
over time most, if not all, Clients benefit from soft dollar
products such that cross subsidizations even out.

Stein Roe attempts to reduce or eliminate this conflict by
directing Client trades for soft dollar products only if Stein Roe
concludes that the broker-dealer supplying the product is capable
of providing a combination of the best net price and execution on
the trade. As noted above, the best net price, while significant,
is one of a number of judgmental factors Stein Roe considers in
determining whether a particular broker is capable of providing
the best net price and execution. Stein Roe may cause a Client
account to pay a brokerage commission in a soft dollar trade in
excess of that which another broker-dealer might have charged for
the same transaction.

Stein Roe acquires two types of soft dollar research
products: (i) proprietary research created by the broker-dealer
firm executing the trade and (ii) other products created by third
parties that are supplied to Stein Roe through the broker-dealer
firm executing the trade.

Proprietary research consists primarily of traditional
research reports, recommendations and similar materials produced
by the in house research staffs of broker-dealer firms. This
research includes evaluations and recommendations of specific
companies or industry groups, as well as analyses of general
economic and market conditions and trends, market data, contacts
and other related information and assistance. Stein Roe's
research analysts periodically rate the quality of proprietary
research produced by various broker-dealer firms. Based on these
evaluations, Stein Roe develops target levels of commission
dollars on a firm-by-firm basis. Stein Roe attempts to direct
trades to each firm to meet these targets.

Stein Roe also uses soft dollars to acquire products created
by third parties that are supplied to Stein Roe through broker-
dealers executing the trade (or other broker-dealers who "step in"
to a transaction and receive a portion of the brokerage commission
for the trade). These products include the following:

* Database Services-comprehensive databases containing current
and/or historical information on companies and industries.
Examples include historical securities prices, earnings
estimates, and SEC filings. These services may include software
tools that allow the user to search the database or to prepare
value-added analyses related to the investment process (such as
forecasts and models used in the portfolio management process).

* Quotation/Trading/News Systems-products that provide real time
market data information, such as pricing of individual
securities and information on current trading, as well as a
variety of news services.
* Economic Data/Forecasting Tools-various macro economic
forecasting tools, such as economic data and economic and
political forecasts for various countries or regions.
* Quantitative/Technical Analysis-software tools that assist in
quantitative and technical analysis of investment data.
* Fundamental Industry Analysis-industry-specific fundamental
investment research.
* Fixed Income Security Analysis-data and analytical tools that
pertain specifically to fixed income securities. These tools
assist in creating financial models, such as cash flow
projections and interest rate sensitivity analyses, that are
relevant to fixed income securities.
* Other Specialized Tools-other specialized products, such as
specialized economic consulting analyses and attendance at
investment oriented conferences.

Many third-party products include computer software or on-
line data feeds. Certain products also include computer hardware
necessary to use the product.

Certain of these third party services may be available
directly from the vendor on a hard dollar basis. Others are
available only through broker-dealer firms for soft dollars.
Stein Roe evaluates each product to determine a cash ("hard
dollars") value of the product to Stein Roe. Stein Roe then on a
product-by-product basis targets commission dollars in an amount
equal to a specified multiple of the hard dollar value to the
broker-dealer that supplies the product to Stein Roe. In general,
these multiples range from 1.25 to 1.85 times the hard dollar
value. Stein Roe attempts to direct trades to each firm to meet
these targets. (For example, if the multiple is 1.5:1.0, assuming
a hard dollar value of $10,000, Stein Roe will target to the
broker-dealer providing the product trades generating $15,000 in
total commissions.)

The targets that Stein Roe establishes for both proprietary
and for third party research products typically will reflect
discussions that Stein Roe has with the broker-dealer providing
the product regarding the level of commissions it expects to
receive for the product. However, these targets are not binding
commitments, and Stein Roe does not agree to direct a minimum
amount of commissions to any broker-dealer for soft dollar
products. In setting these targets, Stein Roe makes a
determination that the value of the product is reasonably
commensurate with the cost of acquiring it. These targets are
established on a calendar year basis. Stein Roe will receive the
product whether or not commissions directed to the applicable
broker-dealer are less than, equal to or in excess of the target.
Stein Roe generally will carry over target shortages and excesses
to the next year's target. Stein Roe believes that this practice
reduces the conflicts of interest associated with soft dollar
transactions, since Stein Roe can meet the non-binding
expectations of broker-dealers providing soft dollar products over
flexible time periods. In the case of third party products, the
third party is paid by the broker-dealer and not by Stein Roe.
Stein Roe may enter into a contract with the third party vendor to
use the product. (For example, if the product includes software,
Stein Roe will enter into a license to use the software from the
vendor.)

In certain cases, Stein Roe uses soft dollars to obtain
products that have both research and non-research purposes.
Examples of non-research uses are administrative and marketing
functions. These are referred to as "mixed use" products. As of
the date of this SAI, Stein Roe acquires two mixed use products.
These are (i) a fixed income security data service and (ii) a
mutual fund performance ranking service. In each case, Stein Roe
makes a good faith evaluation of the research and non-research
uses of these services. These evaluations are based upon the time
spent by Firm personnel for research and non-research uses. Stein
Roe pays the provider in cash ("hard dollars") for the non-
research portion of its use of these products.

Stein Roe may use research obtained from soft dollar trades
in the management of any of its discretionary accounts. Thus,
consistent with industry practice, Stein Roe does not require that
the Client account that generates the trade receive any benefit
from the soft dollar product obtained through the trade. As noted
above, this may result in cross subsidization of soft dollar
products among Client accounts. As noted therein, this practice
is explicitly sanctioned by a provision of the Securities Exchange
Act of 1934, which creates a "safe harbor" for soft dollar
transactions conducted in a specified manner.

In certain cases, Stein Roe will direct a trade to one
broker-dealer with the instruction that it execute the trade and
pay over a portion of the commission from the trade to another
broker-dealer who provides Stein Roe with a soft dollar research
product. The broker-dealer executing the trade "steps out" of a
portion of the commission in favor of the other broker-dealer
providing the soft dollar product. Stein Roe may engage in step
out transactions in order to direct soft dollar commissions to a
broker-dealer which provides research but may not be able to
provide best execution. Brokers who receive step out commissions
typically are brokers providing a third party soft dollar product
that is not available on a hard dollars basis. Stein Roe has not
engaged in step out transactions as a manner of compensating
broker-dealers that sell shares of investment companies managed by
Stein Roe.

The Trust has arranged for its custodian to act as a
soliciting dealer to accept any fees available to the custodian as
a soliciting dealer in connection with any tender offer for
portfolio securities. The custodian will credit any such fees
received against its custodial fees. In addition, the Board of
Trustees has reviewed the legal developments pertaining to and the
practicability of attempting to recapture underwriting discounts
or selling concessions when portfolio securities are purchased in
underwritten offerings. However, the Board has been advised by
counsel that recapture by a mutual fund currently is not permitted
under the Rules of the Association of the National Association of
Securities Dealers.

ADDITIONAL INCOME TAX CONSIDERATIONS

The Fund intends to qualify under Subchapter M of the
Internal Revenue Code and to comply with the special provisions of
the Internal Revenue Code that relieve it of federal income tax to
the extent of net investment income and capital gains currently
distributed to shareholders.

Because dividend and capital gains distributions reduce net
asset value, a shareholder who purchases shares shortly before a
record date will, in effect, receive a return of a portion

of his investment in such distribution. The distribution would
nonetheless be taxable to him, even if the net asset value of
shares were reduced below his cost. However, for federal income
tax purposes the shareholder's original cost would continue as his
tax basis.

The Fund expects that less than 100% of its dividends will
qualify for the deduction for dividends received by corporate
shareholders.

To the extent the Fund invests in foreign securities, it may
be subject to withholding and other taxes imposed by foreign
countries. Tax treaties between certain countries and the United
States may reduce or eliminate such taxes. Investors may be
entitled to claim U.S. foreign tax credits with respect to such
taxes, subject to certain provisions and limitations contained in
the Code. Specifically, if more than 50% of total assets at the
close of any fiscal year consist of stock or securities of foreign
corporations, the Fund may file an election with the Internal
Revenue Service pursuant to which its shareholders will be
required to (i) include in ordinary gross income (in addition to
taxable dividends actually received) their pro rata shares of
foreign income taxes paid by the Fund even though not actually
received, (ii) treat such respective pro rata shares as foreign
income taxes paid by them, and (iii) deduct such pro rata shares
in computing their taxable incomes, or, alternatively, use them as
foreign tax credits, subject to applicable limitations, against
their United States income taxes. Shareholders who do not itemize
deductions for federal income tax purposes will not, however, be
able to deduct their pro rata portion of foreign taxes paid by the
Fund, although such shareholders will be required to include their
share of such taxes in gross income. Shareholders who claim a
foreign tax credit may be required to treat a portion of dividends
received from the Fund as separate category income for purposes of
computing the limitations on the foreign tax credit available to
such shareholders. Tax-exempt shareholders will not ordinarily
benefit from this election relating to foreign taxes. Each year,
the Fund will notify shareholders of the amount of (i) each
shareholder's pro rata share of foreign income taxes paid by the
Fund and (ii) the portion of Fund dividends which represents
income from each foreign country, if the Fund qualifies to pass
along such credit.

INVESTMENT PERFORMANCE

The Fund may quote certain total return figures from time to
time. A "Total Return" on a per share basis is the amount of
dividends distributed per share plus or minus the change in the
net asset value per share for a period. A "Total Return
Percentage" may be calculated by dividing the value of a share at
the end of a period by the value of the share at the beginning of
the period and subtracting one. For a given period, an "Average
Annual Total Return" may be computed by finding the average annual
compounded rate that would equate a hypothetical initial amount
invested of $1,000 to the ending redeemable value.

n
Average Annual Total Return is computed as follows: ERV = P(1+T)

Where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000
payment made at the beginning of the period at the
end of the period (or fractional portion).

Investment performance figures assume reinvestment of all
dividends and distributions and do not take into account any
federal, state, or local income taxes which shareholders must pay
on a current basis. They are not necessarily indicative of future
results. The performance of the Fund is a result of conditions in
the securities markets, portfolio management, and operating
expenses. Although investment performance information is useful
in reviewing performance and in providing some basis for
comparison with other investment alternatives, it should not be
used for comparison with other investments using different
reinvestment assumptions or time periods.

The Fund may note its mention or recognition in newspapers,
magazines, or other media from time to time. However, the Fund
assumes no responsibility for the accuracy of such data.
Newspapers and magazines which might mention the Fund include, but
are not limited to, the following:

Architectural Digest
Arizona Republic
Atlanta Constitution
Atlantic Monthly
Associated Press
Barron's
Bloomberg
Boston Globe
Boston Herald
Business Week
Chicago Tribune
Chicago Sun-Times
Cleveland Plain Dealer
CNBC
CNN
Crain's Chicago Business
Consumer Reports
Consumer Digest
Dow Jones Investment Advisor
Dow Jones Newswire
Fee Advisor
Financial Planning
Financial World
Forbes
Fortune
Fund Action
Fund Marketing Alert
Gourmet
Individual Investor
Investment Dealers' Digest
Investment News
Investor's Business Daily
Kiplinger's Personal Finance Magazine
Knight-Ridder
Lipper Analytical Services
Los Angeles Times
Louis Rukeyser's Wall Street
Money
Money on Line
Morningstar
Mutual Fund Market News
Mutual Fund News Service
Mutual Funds Magazine
Newsday
Newsweek
New York Daily News
The New York Times
No-Load Fund Investor
Pension World
Pensions and Investment
Personal Investor
Physicians Financial News
Jane Bryant Quinn (syndicated column)
Reuters
The San Francisco Chronicle
Securities Industry Daily
Smart Money
Smithsonian
Strategic Insight
Street.com
Time
Travel & Leisure
USA Today
U.S. News & World Report
Value Line
The Wall Street Journal
The Washington Post
Working Women
Worth
Your Money

In advertising and sales literature, the Fund may compare its
performance with that of other mutual funds, indexes or averages
of other mutual funds, indexes of related financial assets or
data, and other competing investment and deposit products
available from or through other financial institutions. The
composition of these indexes or averages differs from that of the
Fund. Comparison of the Fund to an alternative investment should
be made with consideration of differences in features and expected
performance. All of the indexes and averages noted below will be
obtained from the indicated sources or reporting services, which
the Trust believes to be generally accurate.

The Fund may compare its performance to the Consumer Price
Index (All Urban), a widely recognized measure of inflation. Its
performance also may be compared to the following indexes or
averages:

Dow-Jones Industrial Average New York Stock Exchange
Composite Index
Standard & Poor's 500 Stock Index American Stock Exchange
Composite Index
Standard & Poor's 400 Industrials Nasdaq Composite
Standard & Poor's 600 Index Nasdaq Industrials
Wilshire 5000 Russell 2000 Index
(These indexes are widely (These indexes generally
recognized indicators of reflect the performance of
general U.S. stock market stocks traded in the
results.) indicated markets.)

In addition, the Fund may compare its performance to the
following benchmarks:

AMEX Computer Technology Index
AMEX Interactive Week
AMEX Interactive Week Internet
CBOE GSTI Internet Index
CBOE Internet Index
CBOE Internet Index Leaps - WXI
CBOE Internet Index Leaps - ZIX
Dow Jones Internet Index
Pacific Stock Exchange Technology Index
S&P Technology Index
TheStreet.com Internet Index

The Lipper and Morningstar averages are unweighted averages
of total return performance of mutual funds as classified,
calculated, and published by these independent services that
monitor the performance of mutual funds. The Fund may also use
comparative performance as computed in a ranking by Lipper or
category averages and rankings provided by another independent
service. Should Lipper or another service reclassify the Fund to
a different category or develop (and place it into) a new
category, it may compare its performance or ranking with those of
other funds in the newly assigned category, as published by the
service.

The Fund may also cite its rating, recognition, or other
mention by Morningstar or any other entity. Morningstar's rating
system is based on risk-adjusted total return performance and is
expressed in a star-rating format. The risk-adjusted number is
computed by subtracting a fund's risk score (which is a function
of the fund's monthly returns less the 3-month T-bill return) from
its load-adjusted total return score. This numerical score is
then translated into rating categories, with the top 10% labeled
five star, the next 22.5% labeled four star, the next 35% labeled
three star, the next 22.5% labeled two star, and the bottom 10%
one star. A high rating reflects either above-average returns or
below-average risk, or both.

Of course, past performance is not indicative of future
results.
________________

To illustrate the historical returns on various types of
financial assets, the Fund may use historical data provided by
Ibbotson Associates, Inc. ("Ibbotson"), a Chicago-based investment
firm. Ibbotson constructs (or obtains) very long-term (since
1926) total return data

(including, for example, total return indexes, total return
percentages, average annual total returns and standard deviations
of such returns) for the following asset types:

Common stocks
Small company stocks
Long-term corporate bonds
Long-term government bonds
Intermediate-term government bonds
U.S. Treasury bills
Consumer Price Index
_____________________

The Fund may also use hypothetical returns to be used as an
example in a mix of asset allocation strategies. One such example
is reflected in the chart below, which shows the effect of tax
deferral on a hypothetical investment. This chart assumes that an
investor invested $2,000 a year on January 1, for any specified
period, in both a Tax-Deferred Investment and a Taxable
Investment, that both investments earn either 6%, 8% or 10%
compounded annually, and that the investor withdrew the entire
amount at the end of the period. (A tax rate of 39.6% is applied
annually to the Taxable Investment and on the withdrawal of
earnings on the Tax-Deferred Investment.)

<TABLE>
<CAPTION>
TAX-DEFERRED INVESTMENT VS. TAXABLE INVESTMENT

Interest
Rate 3% 5% 7% 9% 3% 5% 7% 9%
- --------------------------------------------------------------------------------
Com-
pound-
ing
Years Tax-Deferred Investment Taxable Investment
- ---- ------------------------------------ ------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
30 $82,955 $108,031 $145,856 $203,239 $80,217 $98,343 $121,466 $151,057
25 65,164 80,337 101,553 131,327 63,678 75,318 89,528 106,909
20 49,273 57,781 68,829 83,204 48,560 55,476 63,563 73,028
15 35,022 39,250 44,361 50,540 34,739 38,377 42,455 47,025
10 22,184 23,874 25,779 27,925 22,106 23,642 25,294 27,069
5 10,565 10,969 11,393 11,840 10,557 10,943 11,342 11,754
1 2,036 2,060 2,085 2,109 2,036 2,060 2,085 2,109
</TABLE>

Dollar Cost Averaging. Dollar cost averaging is an
investment strategy that requires investing a fixed amount of
money in Fund shares at set intervals. This allows you to
purchase more shares when prices are low and fewer shares when
prices are high. Over time, this tends to lower your average cost
per share. Like any investment strategy, dollar cost averaging
can't guarantee a profit or protect against losses in a steadily
declining market. Dollar cost averaging involves uninterrupted
investing regardless of share price and therefore may not be
appropriate for every investor.

From time to time, the Fund may offer in its advertising and
sales literature to send an investment strategy guide, a tax
guide, or other supplemental information to investors and
shareholders. It may also mention the Stein Roe Counselor
[service mark] and the Stein Roe Personal Counselor [service mark]
programs and asset allocation and other investment strategies.

APPENDIX-RATINGS

RATINGS IN GENERAL

A rating of a rating service represents the service's opinion
as to the credit quality of the security being rated. However,
the ratings are general and are not absolute standards of quality
or guarantees as to the creditworthiness of an issuer.
Consequently, Stein Roe believes that the quality of debt
securities in which a fund invests should be continuously reviewed
and that individual analysts give different weightings to the
various factors involved in credit analysis. A rating is not a
recommendation to purchase, sell or hold a security because it
does not take into account market value or suitability for a
particular investor. When a security has received a rating from
more than one service, each rating should be evaluated
independently. Ratings are based on current information furnished
by the issuer or obtained by the rating services from other
sources which they consider reliable. Ratings may be changed,
suspended or withdrawn as a result of changes in or unavailability
of such information, or for other reasons.

The following is a description of the characteristics of
ratings of corporate debt securities used by Moody's Investors
Service, Inc. ("Moody's") and Standard & Poor's Corporation
("S&P").

RATINGS BY MOODY'S

Aaa. Bonds rated Aaa are judged to be the best quality. They
carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a
large or an exceptionally stable margin and principal is secure.
Although the various protective elements are likely to change,
such changes as can be visualized are more unlikely to impair the
fundamentally strong position of such bonds.

Aa. Bonds rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are
generally known as high grade bonds. They are rated lower than
the best bonds because margins of protection may not be as large
as in Aaa bonds or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which
make the long-term risks appear somewhat larger than in Aaa bonds.

A. Bonds rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors
giving security to principal and interest are considered adequate,
but elements may be present which suggest a susceptibility to
impairment sometime in the future.

Baa. Bonds rated Baa are considered as 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. Such
bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.

Ba. Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured.
Often the protection of interest and principal payments may be

very moderate and thereby not well safeguarded during both good
and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B. Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal
payments or of maintenance of other terms of the contract over any
long period of time may be small.

Caa. Bonds which are rated 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. Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or
have other marked shortcomings.

NOTE: Moody's applies numerical modifiers 1, 2, and 3 in
each generic rating classification from Aa through B in its
corporate bond rating system. The modifier 1 indicates that the
security ranks in the higher end of its generic rating category;
the modifier 2 indicates a mid-range ranking; and the modifier 3
indicates that the issue ranks in the lower end of its generic
rating category.

RATINGS BY S&P

AAA. Debt rated AAA has the highest rating. Capacity to pay
interest and repay principal is extremely strong.

AA. Debt rated AA has a very strong capacity to pay interest and
repay principal and differs from the highest rated issues only in
small degree.

A. Debt rated A has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than
debt in higher rated categories.

BBB. Debt rated BBB is 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 for debt in higher rated categories.

BB, B, CCC, CC, and C. Debt rated BB, B, CCC, CC, or C is
regarded, on balance, as predominantly speculative with respect to
capacity to pay interest and repay principal in accordance with
the terms of the obligation. BB indicates the lowest degree of
speculation and C the highest degree of speculation. While such
debt will likely have some quality and protective characteristics,
these are outweighed by large uncertainties or major risk
exposures to adverse conditions.

C1. This rating is reserved for income bonds on which no interest
is being paid.

D. Debt rated D is in default, and payment of interest and/or
repayment of principal is in arrears. The D rating is also used
upon the filing of a bankruptcy petition if debt service payments
are jeopardized.

<PAGE 45>
NOTES:
The ratings from AA to CCC may be modified by the addition of a
plus (+) or minus (-) sign to show relative standing within the
major rating categories. Foreign debt is rated on the same basis
as domestic debt measuring the creditworthiness of the issuer;
ratings of foreign debt do not take into account currency exchange
and related uncertainties.

The "r" is attached to highlight derivative, hybrid, and certain
other obligations that S&P believes may experience high volatility
or high variability in expected returns due to non-credit risks.
Examples of such obligations are: securities whose principal or
interest return is indexed to equities, commodities, or
currencies; certain swaps and options; and interest only and
principal only mortgage securities. The absence of an "r" symbol
should not be taken as an indication that an obligation will
exhibit no volatility or variability in total return.
_______________________

<PAGE>

PART C. OTHER INFORMATION

ITEM 23. EXHIBITS [Note: As used herein, the term "Registration
Statement" refers to the Registration Statement of the
Registrant on Form N-1A under the Securities Act of 1933, No.
333-17255. The terms "Pre-Effective Amendment" and "PEA"
refer, respectively, to a pre-effective amendment and a post-
effective amendment to the Registration Statement.]

(a) Agreement and Declaration of Trust as amended through Feb. 12,
1999. (Exhibit (a) to PEA #10.)*

(b)(1) By-Laws of Registrant. (Exhibit 2 to Registration
Statement.)*
(2) Amendment to By-Laws dated 2/4/98. (Exhibit 2(b)
to PEA #8.)*

(d) None.

(e)(1) Underwriting agreement between Registrant and
Liberty Funds Distributor, Inc. dated 8/4/99.
(2) Selling agreement. (Exhibit 6(c) to PEA #2.)*

(f) None.

(g) Custodian contract between Registrant and State Street Bank and
Trust Company dated 2/13/97. (Exhibit 8 to PEA #1.)*

(h)(1) Transfer agency agreement between Registrant and Liberty
Funds Services, Inc. (formerly named Colonial Investors
Service Center, Inc.) dated 10/15/97 as amended through
12/15/98.
(2) Administrative agreement between Registrant and Stein
Roe & Farnham Incorporated dated 2/14/97 as amended
through 6/28/99.
(3) Accounting and bookkeeping agreement between Registrant
and Stein Roe & Farnham Incorporated dated 8/3/99.

(i)(1) Opinion and consent of Bell, Boyd & Lloyd relating to
Stein Roe Advisor Growth & Income Fund, Stein Roe Advisor
International Fund, Stein Roe Advisor Young Investor Fund,
Stein Roe Advisor Special Venture Fund, Stein Roe Advisor
Balanced Fund, Stein Roe Advisor Growth Stock Fund, and
Stein Roe Advisor Special Fund. (Exhibit 10 to Pre-
Effective Amendment #1.)*
(2) Opinion and consent of Bell, Boyd & Lloyd with respect to
Stein Roe Advisor High-Yield Municipals Fund, Stein Roe
Advisor Intermediate Bond Fund, and Stein Roe Advisor Income
Fund. (Exhibit 10(b) to PEA #5.)*

(j) None.

(k) None.

(l) Inapplicable.

(m) Amended Rule 12b-1 plan dated 12/12/98. (Exhibit (m) to
PEA #10.)*

(n) Amended Rule 18f-3 plan dated 2/4/98. (Exhibit (n) to
PEA #10.)*
- -----------
*Incorporated by reference.

ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH
REGISTRANT.

The Registrant does not consider that it is directly or indirectly
controlling, controlled by, or under common control with other
persons within the meaning of this Item. See "Investment Advisory
and Other Services," "Management," and "Transfer Agent" in the
Statement of Additional Information, each of which is incorporated
herein by reference.

ITEM 25. INDEMNIFICATION.

Article VIII of the Agreement and Declaration of Trust of
Registrant (Exhibit a), which Article is incorporated herein by
reference, provides that Registrant shall provide indemnification
of its trustees and officers (including persons who serve or
have served at Registrant's request as directors, officers, or
trustees of another organization in which Registrant has any
interest as a shareholder, creditor or otherwise) ("Covered
Persons") under specified circumstances.

Section 17(h) of the Investment Company Act of 1940 ("1940 Act")
provides that neither the Agreement and Declaration of Trust nor
the By-Laws of Registrant, nor any other instrument pursuant to
which Registrant is organized or administered, shall contain any
provision which protects or purports to protect any trustee or
officer of Registrant against any liability to Registrant or its
shareholders to which he would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of his office. In
accordance with Section 17(h) of the 1940 Act, Article VIII shall
not protect any person against any liability to Registrant or its
shareholders to which he would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of his office.

Unless otherwise permitted under the 1940 Act,

(i) Article VIII does not protect any person against any
liability to Registrant or to its shareholders to which he would
otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in
the conduct of his office;

(ii) in the absence of a final decision on the merits by a
court or other body before whom a proceeding was brought that a
Covered Person was not liable to the Registrant or its
shareholders by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the
conduct of his office, indemnification is permitted under Article
VIII if (a) approved as in the best interest of the Registrant,
after notice that it involves such indemnification, by at least a
majority of the Trustees who are disinterested persons are not
"interested persons" as defined in Section 2(a)(19) of the 1940
Act ("disinterested trustees"), upon determination, based upon a
review of readily available facts (but not a full trial-type
inquiry) that such Covered Person is not liable to the Registrant
or its shareholders by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in
the conduct of such Covered Person's office or (b) there has been
obtained a opinion in writing of independent legal counsel, based
upon a review of readily available facts (but not a full trial-
type inquiry) to the effect that such indemnification would not
protect such Covered Person against any liability to the Trust to
which such Covered Person would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his office; and

(iii) Registrant will not advance expenses, including
counsel fees(but excluding amounts paid in satisfaction of
judgments, in compromise or as fines or penalties), incurred by a
Covered Person unless Registrant receives an undertaking by or on
behalf of the Covered Person to repay the advance if it is
ultimately determined that indemnification of such expenses is not
authorized by Article VII and (a) the Covered Person provides
security for his undertaking, or (b) Registrant is insured against
losses arising by reason of such Covered Person's failure to
fulfill his undertaking, or (c) a majority of the disinterested
trustees of Registrant or an independent legal counsel as
expressed in a written opinion, determine, based on a review of
readily available facts (as opposed to a full trial-type inquiry),
that there is reason to believe that the Covered Person ultimately
will be found entitled to indemnification.

Any approval of indemnification pursuant to Article VIII does not
prevent the recovery from any Covered Person of any amount paid to
such Covered Person in accordance with Article VIII as
indemnification if such Covered Person is subsequently adjudicated
by a court of competent jurisdiction to have been liable to the
Trust or its shareholders by reason of willful misfeasance, bad
faith, gross negligence, or reckless disregard of the duties
involved in the conduct of such Covered Person's office.

Article VIII also provides that its indemnification provisions
are not exclusive.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers, and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, Registrant has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment
by Registrant of expenses incurred or paid by a trustee, officer,
or controlling person of Registrant in the successful defense of
any action, suit, or proceeding) is asserted by such trustee,
officer, or controlling person in connection with the securities
being registered, Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.

Registrant, its trustees and officers, its investment adviser, the
other investment companies advised by the adviser, and persons
affiliated with them are insured against certain expenses in
connection with the defense of actions, suits, or proceedings, and
certain liabilities that might be imposed as a result of such
actions, suits, or proceedings. Registrant will not pay any
portion of the premiums for coverage under such insurance that
would (1) protect any trustee or officer against any liability to
Registrant or its shareholders to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties involved in the
conduct of his office or (2) protect its investment adviser or
principal underwriter, if any, against any liability to Registrant
or its shareholders to which such person would otherwise be
subject by reason of willful misfeasance, bad faith, or gross
negligence, in the performance of its duties, or by reason of its
reckless disregard of its duties and obligations under its
contract or agreement with the Registrant; for this purpose the
Registrant will rely on an allocation of premiums determined by
the insurance company.

Registrant, its trustees, officers, employees and representatives
and each person, if any, who controls the Registrant within the
meaning of Section 15 of the Securities Act of 1933 are
indemnified by the distributor of Registrant's shares (the
"distributor"), pursuant to the terms of the distribution
agreement, which governs the distribution of Registrant's shares,
against any and all losses, liabilities, damages, claims and
expenses arising out of the acquisition of any shares of the
Registrant by any person which (i) may be based upon any wrongful
act by the distributor or any of the distributor's directors,
officers, employees or representatives or (ii) may be based upon
any untrue or alleged untrue statement of a material fact
contained in a registration statement, prospectus, statement of
additional information, shareholder report or other information
covering shares of the Registrant filed or made public by the
Registrant or any amendment thereof or supplement thereto or the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement
therein not misleading if such statement or omission was made in
reliance upon information furnished to the Registrant by the
distributor in writing. In no case does the distributor's
indemnity indemnify an indemnified party against any liability to
which such indemnified party would otherwise be subject by reason
of willful misfeasance, bad faith, or negligence in the
performance of its or his duties or by reason of its or his
reckless disregard of its or his obligations and duties under the
distribution agreement.

ITEM 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER.

Stein Roe & Farnham Incorporated ("Stein Roe"), the investment
adviser, is a wholly owned subsidiary of SteinRoe Services Inc.
("SSI"), which in turn is a wholly owned subsidiary of Liberty
Financial Companies, Inc., which is a majority owned subsidiary
of Liberty Corporation Holdings, Inc., which is a wholly owned
subsidiary of LFC Holdings, Inc., which in turn is a subsidiary
of Liberty Mutual Equity Corporation, which in turn is a
subsidiary of Liberty Mutual Insurance Company. Stein Roe acts
as investment adviser to individuals, trustees, pension and
profit-sharing plans, charitable organizations, and other
investors. In addition to Registrant, it also acts as
investment adviser to other investment companies having
different investment policies.

For a two-year business history of officers and directors of
Stein Roe, please refer to the Form ADV of Stein Roe &
Farnham Incorporated and to the section of the statement of
additional information (Part B) entitled "Investment Advisory
and Other Services."

Certain directors and officers of Stein Roe also serve and have
during the past two years served in various capacities as
officers, directors, or trustees of SSI, of Colonial Management
Associates, Inc. (which is a subsidiary of Liberty Financial
Companies, Inc.), and of the Registrant and other investment
companies managed by SteinRoe. (The listed entities are located
at One South Wacker Drive, Chicago, Illinois 60606, except for
Colonial Management Associates, Inc., which is located at One
Financial Center, Boston, MA 02111, and SteinRoe Variable
Investment Trust and Liberty Variable Investment Trust, which
are located at Federal Reserve Plaza, Boston, MA 02210.) A
list of such capacities is given below.

POSITION FORMERLY
HELD WITHIN
CURRENT POSITION PAST TWO YEARS
------------------- --------------
STEINROE SERVICES INC.
Gary A. Anetsberger Vice President
Thomas W. Butch President; Director; Chmn. Vice President
Kevin M. Carome Assistant Clerk
Kenneth J. Kozanda Vice President; Treasurer
Kenneth R. Leibler Director
Karl J. Maurer Comptroller
C. Allen Merritt, Jr. Director; Vice President
Heidi J. Walter Vice President; Secretary

COLONIAL MANAGEMENT ASSOCIATES, INC.
Ophelia L. Barsketis Senior Vice President
Kevin M. Carome Senior Vice President
William M. Garrison Vice President
Loren A. Hansen Senior Vice President
Clare M. Hounsell Vice President
James P. Haynie Senior Vice President
Timothy J. Jacoby Senior Vice President
Deborah A. Jansen Senior Vice President
North T. Jersild Vice President
Yvonne T. Shields Vice President

SR&F BASE TRUST
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
David P. Brady Vice-President
Thomas W. Butch President Executive V-P;
Trustee
Daniel K. Cantor Vice-President
Kevin M. Carome Executive VP; Asst. Secy. VP
Erik P. Gustafson Vice-President
Loren A. Hansen Executive Vice-President
James P. Haynie Vice-President
Harvey B. Hirschhorn Vice-President
Michael T. Kennedy Vice-President
Stephen F. Lockman Vice-President
Jane M. Naeseth Vice-President
Maureen G. Newman Vice-President
Gita R. Rao Vice-President
Michael E. Rega Vice-President
Veronica M. Wallace Vice-President
Heidi J. Walter Vice-President; Secretary

STEIN ROE INCOME TRUST; STEIN ROE INSTITUTIONAL TRUST; AND
STEIN ROE TRUST
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
Thomas W. Butch President Exec. V-P;
V-P; Trustee
Kevin M. Carome Executive VP; Asst. Secy. VP
Loren A. Hansen Executive Vice-President
Michael T. Kennedy Vice-President
Stephen F. Lockman Vice-President
Lynn C. Maddox Vice-President
Jane M. Naeseth Vice-President
Heidi J. Walter Vice-President; Secretary

STEIN ROE INVESTMENT TRUST
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
David P. Brady Vice-President
Thomas W. Butch President Exec. V-P;
V-P; Trustee
Daniel K. Cantor Vice-President
Kevin M. Carome Executive VP; Asst. Secy. VP
William M. Garrison Vice-President
Erik P. Gustafson Vice-President
Loren A. Hansen Executive Vice-President
James P. Haynie Vice-President
Harvey B. Hirschhorn Vice-President
Lynn C. Maddox Vice-President
Arthur J. McQueen Vice-President
Gita R. Rao Vice-President
Michael E. Rega Vice-President
Heidi J. Walter Vice-President; Secretary

LIBERTY-STEIN ROE ADVISOR TRUST
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
David P. Brady Vice-President
Thomas W. Butch President Exec. V-P;
V-P; Trustee
Daniel K. Cantor Vice-President
Kevin M. Carome Executive VP; Asst. Secy. VP
Erik P. Gustafson Vice-President
Loren A. Hansen Executive Vice-President
James P. Haynie Vice-President
Harvey B. Hirschhorn Vice-President
Michael T. Kennedy Vice-President
Stephen F. Lockman Vice-President
Lynn C. Maddox Vice-President
Arthur J. McQueen Vice-President
Maureen G. Newman Vice-President
Gita R. Rao Vice-President
Michael E. Rega Vice-President
Heidi J. Walter Vice-President; Secretary

STEIN ROE MUNICIPAL TRUST
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
Thomas W. Butch President Exec. V-P;
V-P; Trustee
Kevin M. Carome Executive VP; Asst. Secy. VP
Joanne T. Costopoulos Vice-President
Loren A. Hansen Executive Vice-President
Brian M. Hartford Vice-President
William C. Loring Vice-President
Lynn C. Maddox Vice-President
Maureen G. Newman Vice-President
Veronica M. Wallace Vice-President
Heidi J. Walter Vice-President; Secretary

STEINROE VARIABLE INVESTMENT TRUST
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
Thomas W. Butch President
Kevin M. Carome Executive VP; Asst. Secy. VP
William M. Garrison Vice President
Erik P. Gustafson Vice President
Loren A. Hansen Executive Vice-President
Harvey B. Hirschhorn Vice President
Michael T. Kennedy Vice President
Jane M. Naeseth Vice President
William M. Wadden IV Vice President
Heidi J. Walter Vice President

STEIN ROE FLOATING RATE INCOME TRUST; STEIN ROE INSTITUTIONAL
FLOATING RATE INCOME TRUST, STEIN ROE FLOATING RATE LIMITED
LIABILITY COMPANY
William D. Andrews Executive Vice-President
Gary A. Anetsberger Senior V-P; Treasurer Controller
Thomas W. Butch President; Trustee or Manager
Kevin M. Carome Executive VP; Asst. Secy. VP
Brian W. Good Vice-President
James R. Fellows Vice-President
Loren A. Hansen Executive Vice-President
Heidi J. Walter Vice-President; Secretary

LIBERTY VARIABLE INVESTMENT TRUST
Ophelia L. Barsketis Vice President
Deborah A. Jansen Vice President
Kevin M. Carome Vice President

ITEM 27. PRINCIPAL UNDERWRITERS.

Registrant's principal underwriter, Liberty Funds Distributor,
Inc., a subsidiary of Colonial Management Associates, Inc.,
acts as underwriter to Liberty Funds Trust I, Liberty Funds Trust
II, Liberty Funds Trust III, Liberty Funds Trust IV, Liberty
Funds Trust V, Liberty Funds Trust VI, Liberty Funds Trust VII,
Liberty Funds Trust IX, Stein Roe Investment Trust, Stein Roe
Income Trust, Stein Roe Municipal Trust, Liberty-Stein Roe
Advisor Trust, Stein Roe Institutional Trust, Stein Roe Trust,
Stein Roe Floating Rate Income Fund, Stein Roe Institutional
Floating Rate Income Fund, and SteinRoe Variable Investment
Trust. The table below lists the directors and officers of
Liberty Funds Distributor, Inc.

Position and Offices Positions and
Name and Principal with Principal Offices with
Business Address* Underwriter Registrant
- -------------------- --------------------- -------------
Anderson, Judith Vice President None
Anetsberger, Gary A. Senior Vice President Senior V-P;
Treasurer
Babbitt, Debra VP & Compliance Officer None
Ballou, Rick Senior Vice President None
Bartlett, John Managing Director None
Blakeslee, James Senior Vice President None
Blumenfeld, Alex Vice President None
Bozek, James Senior Vice President None
Brown, Beth Vice President None
Burtman, Tracy Vice President None
Butch, Thomas W. Senior Vice President President
Campbell, Patrick Vice President None
Chrzanowski, Daniel Vice President None
Clapp, Elizabeth A. Managing Director None
Conlin, Nancy L. Director; Clerk None
Davey, Cynthia Sr. Vice President None
Desilets, Marian H. Vice President None
Devaney, James Senior Vice President None
DiMaio, Steve Vice President None
Downey, Christopher Vice President None
Dupree, Robert Vice President None
Emerson, Kim P. Senior Vice President None
Erickson, Cynthia G. Senior Vice President None
Evans, C. Frazier Managing Director None
Feldman, David Managing Director None
Fifield, Robert Vice President None
Gariepy, Tom Vice President None
Gauger, Richard Vice President None
Gerokoulis, Stephen A. Senior Vice President None
Gibson, Stephen E. Director; Chairman of Board None
Goldberg, Matthew Senior Vice President None
Gupta, Neeti Vice President None
Geunard, Brian Vice President None
Harrington, Tom Sr. Vice President None
Harris, Carla L. Vice President None
Hodgkins, Joseph Sr. Vice President None
Hussey, Robert Senior Vice President None
Iudice, Jr., Philip Treasurer and CFO None
Jones, Cynthia Vice President None
Jones, Jonathan Vice President None
Kelley, Terry M. Vice President None
Kelson, David W. Senior Vice President None
Libutti, Chris Vice President None
Martin, John Senior Vice President None
Martin, Peter Vice President None
McCombs, Gregory Senior Vice President None
McKenzie, Mary Vice President None
Menchin, Catherine Senior Vice President None
Miller, Anthony Vice President None
Moberly, Ann R. Senior Vice President None
Morse, Jonathan Vice President None
Nickodemus, Paul Vice President None
O'Shea, Kevin Managing Director None
Piken, Keith Vice President None
Place, Jeffrey Managing Director None
Powell, Douglas Vice President None
Predmore, Tracy Vice President None
Quirk, Frank Vice President None
Raftery-Arpino, Linda Senior Vice President None
Ratto, Gregory Vice President None
Reed, Christopher B. Senior Vice President None
Riegel, Joyce B. Vice President None
Robb, Douglas Vice President None
Sandberg, Travis Vice President None
Santosuosso, Louise Senior Vice President None
Schulman, David Senior Vice President None
Shea, Terence Vice President None
Sideropoulos, Lou Vice President None
Sinatra, Peter Vice President None
Smith, Darren Vice President None
Soester, Trisha Vice President None
Studer, Eric Vice President None
Sweeney, Maureen Vice President None
Tambone, James Chief Executive Officer None
Tasiopoulos, Lou President None
VanEtten, Keith H. Senior Vice President None
Walter, Heidi J. Vice President V-P & Secy.
Wess, Valerie Senior Vice President None
Young, Deborah Vice President None
- ---------
* The address of Ms. Harris, Ms. Riegel, Ms. Walter, and Messrs.
Anetsberger and Butch is One South Wacker Drive, Chicago, IL
60606. The address of each other director and officer is One
Financial Center, Boston, MA 02111.

ITEM 28. LOCATION OF ACCOUNTS AND RECORDS.

Registrant maintains the records required to be maintained by it
under Rules 31a-1(a), 31a-1(b), and 31a-2(a) under the
Investment Company Act of 1940 at its principal executive
offices at One South Wacker Drive, Chicago, Illinois 60606.
Certain records, including records relating to Registrant's
shareholders and the physical possession of its securities, may
be maintained pursuant to Rule 31a-3 at the main office of
Registrant's transfer agent or custodian.

ITEM 29. MANAGEMENT SERVICES.
None.

ITEM 30. UNDERTAKINGS.
None.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
amendment to the Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of
Chicago and State of Illinois on the 10th day of August, 1999.

LIBERTY-STEIN ROE ADVISOR TRUST

By THOMAS W. BUTCH
Thomas W. Butch
President

Pursuant to the requirements of the Securities Act of 1933, this
amendment to the Registration Statement has been signed below by
the following persons in the capacities and on the dates indicated:

Signature Title Date
- ------------------------ --------------------- --------------
THOMAS W. BUTCH President August 10, 1999
Thomas W. Butch
Principal Executive Officer

GARY A. ANETSBERGER Senior Vice- August 10, 1999
Gary A. Anetsberger President; Treasurer
Principal Financial Officer

PATRICIA J. JUDGE Controller August 10, 1999
Patricia J. Judge
Principal Accounting Officer

JOHN A. BACON JR. Trustee August 10, 1999
John A. Bacon Jr.

WILLIAM W. BOYD Trustee August 10, 1999
William W. Boyd

LINDSAY COOK Trustee August 10, 1999
Lindsay Cook

DOUGLAS A. HACKER Trustee August 10, 1999
Douglas A. Hacker

JANET LANGFORD KELLY Trustee August 10, 1999
Janet Langford Kelly

CHARLES R. NELSON Trustee August 10, 1999
Charles R. Nelson

THOMAS C. THEOBALD Trustee August 10, 1999
Thomas C. Theobald

<PAGE>

STEIN ROE ADVISOR TRUST
INDEX TO EXHIBITS FILED WITH THIS AMENDMENT

Exhibit
Number Description
- ------- -------------

(e)(1) Underwriting Agreement

(h)(1) Transfer Agency Agreement

(h)(2) Administrative Agreement

(h)(3) Accounting and Bookkeeping Agreement

UNDERWRITING AGREEMENT BETWEEN
LIBERTY-STEIN ROE ADVISOR TRUST
AND LIBERTY FUNDS DISTRIBUTOR, INC.

THIS UNDERWRITING AGREEMENT ("Agreement"), made as of the 4th
day of August, 1999 by and between Liberty-Stein Roe Advisor
Trust, a business trust organized and existing under the laws of
the Commonwealth of Massachusetts (hereinafter called the "Fund"),
and Liberty Funds Distributor, Inc., (f/k/a Colonial Investment
Services, Inc.) a corporation organized and existing under the
laws of the Commonwealth of Massachusetts (hereinafter called the
"Distributor").

WITNESSETH:

WHEREAS, the Fund is engaged in business as an open-end
management investment company registered under the Investment
Company Act of 1940, as amended ("ICA-40"); and

WHEREAS, the Distributor is registered as a broker-dealer
under the Securities Exchange Act of 1934, as amended ("SEA-34")
and the laws of each state (including the District of Columbia and
Puerto Rico) in which it engages in business to the extent such
law requires, and is a member of the National Association of
Securities Dealers ("NASD") (such registrations and membership are
referred to collectively as the "Registrations"); and

WHEREAS, the Fund desires the Distributor to act as the
distributor in the public offering of its Shares of beneficial
interest (hereinafter called "Shares");

WHEREAS, the Fund shall pay all charges of its transfer,
shareholder recordkeeping, dividend disbursing and redemption
agents, if any; all expenses of notices, proxy solicitation
material and reports to shareholders; all expenses of preparation
of annual or more frequent revisions of the Fund's Prospectus and
Statement of Additional Information ("SAI") and of supplying
copies thereof to shareholders; all expenses of registering and
maintaining the registration of the Fund under ICA-40 and of the
Fund's Shares under the Securities Act of 1933, as amended ("SA-
33"); all expenses of qualifying and maintaining qualification of
such Fund and of the Fund's Shares for sale under securities laws
of various states or other jurisdictions and of registration and
qualification of the Fund under all laws applicable to the Fund or
its business activities; and

WHEREAS, Stein Roe & Farnham Incorporated, investment adviser
to the Funds, or its affiliates, may pay expenses incurred in the
sale and promotion of the Fund except as provided in the Fund's
12b-1 plan;

NOW, THEREFORE, in consideration of the premises and the
mutual promises hereinafter set forth, the parties hereto agree as
follows:

1. Appointment. The Fund appoints Distributor to act as
principal underwriter (as such term is defined in Sections
2(a)(29) of ICA-40) of its Shares for each series or class of the
Fund set forth on Schedule A hereto.

2. Delivery of Fund Documents. The Fund has furnished
Distributor with properly certified or authenticated copies of
each of the following in effect on the date hereof and shall
furnish Distributor from time to time properly certified or
authenticated copies of all amendments or supplements thereto:

(a) Agreement and Declaration of Trust;

(b) By-Laws;

(c) Resolutions of the Board of Trustees of the Fund
(hereinafter referred to as the "Board") selecting
Distributor as distributor and approving this form of
agreement and authorizing its execution.

The Fund shall furnish Distributor promptly with copies of
any registration statements filed by it with the Securities and
Exchange Commission ("SEC") under SA-33 or ICA-40, together with
any financial statements and exhibits included therein, and all
amendments or supplements thereto hereafter filed.

The Fund also shall furnish Distributor such other
certificates or documents which Distributor may from time to time,
in its discretion, reasonably deem necessary or appropriate in the
proper performance of its duties.

3. Distribution of Shares.

(a) Subject to the provisions of Paragraphs 6, 7, 10, 11, 12,
13 and 14 hereof, and to such minimum purchase and other
requirements as may from time to time be indicated in the
Fund's Prospectus, Distributor, acting as principal for
its own account and not as agent for the Fund, shall have
the right to purchase Shares from the Fund. Distributor
shall sell Shares only in accordance with the Fund's
Prospectus, on a "best efforts" basis. Distributor shall
purchase Shares from the Fund at a price equal to the net
asset value, shall sell Shares at the public offering
price as defined in Paragraph 8, and shall retain all
sales charges.

(b) The Fund shall pay all expenses associated with notices,
proxy solicitation material, the preparation of annual or
more frequent revisions to the Fund's Prospectus and SAI
and of printing and supplying the currently effective
Prospectus and SAI to shareholders, other than those
necessitated by Distributor's activities or rules and
regulations related to Distributor's activities where
such amendments or supplements result in expenses which
the Fund would not otherwise have incurred.

(c) The Distributor (or its affiliates) shall pay the costs
of printing and supplying all copies of the Prospectus
and SAI that it may reasonably request for use in
connection with the distribution of Shares. The
Distributor will also pay the expenses of the
preparation, excluding legal fees, and printing of all
amendments and supplements to the Fund's Prospectus and
SAI if the amendment or supplement arises from
Distributor's activities or rules and regulations related
to Distributor's activities and those expenses would not
otherwise have been incurred by the Fund. Distributor
will pay all expenses incurred by Distributor in
advertising, promoting and selling Fund Shares.

(d) Prior to the continuous offering of any Fund Shares,
commencing on a date agreed upon by the Fund and the
Distributor, it is contemplated that the Distributor may
solicit subscriptions for such Shares during a
subscription period which shall last for such period as
may be agreed upon by the parties hereto. The
subscriptions will be payable within three business days
after the termination of the subscription period, at
which time the Fund will commence operations.

4. Selling Agreements. Distributor is authorized to enter
into agreements with other broker-dealers providing for the
solicitation of unconditional orders for purchases of the Fund's
Shares authorized for issuance and registered under SA-33 and fix
therein the portion of the sales charge which may be reallowed to
the selected dealers, as permitted under that Fund's prospectus.
All such agreements shall be either in the form of agreement
attached hereto or in such other form as may be approved by the
officers of the Fund ("Selling Agreement"). Within the United
States, the Distributor shall offer and sell Shares to such
selected dealers as are members in good standing of the NASD;
"banks" as such term is defined in Section 3(a)(6) of the Exchange
Act or a "bank holding company" as such term is defined in the
Bank Holding Company Act of 1956, as amended, duly organized,
validly existing and in good standing under the laws of the
jurisdiction in which it was organized; and such other entities or
purchasers as otherwise mutually agreed in writing.

5. Conduct of Business. Other than as set forth in the
Fund's currently effective prospectus, Distributor will not
distribute any sales material or statements except literature or
advertising which conforms to the requirements of federal and
state securities laws and regulations which have been filed, where
necessary, with the appropriate regulatory authorities. Upon the
Fund's request, Distributor will furnish the Fund with copies of
all such materials prior to their use. Any sales material or
statements the substance of which is not included in the
Prospectus or SAI shall be submitted for advance approval by the
Fund.

6. Solicitation of Orders to Purchase Shares by Fund. The
rights granted to the Distributor shall be non-exclusive in that
the Fund reserves the right to solicit purchases from, and sell
its Shares to, investors. Further, the Fund reserves the right to
issue Shares in connection with the merger or consolidation of any
other investment company, trust or personal holding company with
the Fund, or the Fund's acquisition, by the purchase or otherwise,
of all or substantially all of the assets of an investment
company, trust or personal holding company, or substantially all
of the outstanding Shares or interests of any such entity. Any
right granted to Distributor to solicit purchases of Shares will
not apply to Shares that may be offered by the Fund to
shareholders by virtue of their being shareholders of the Fund.

7. Shares Covered by this Agreement. This Agreement relates
to the solicitation of orders to purchase Shares that are duly
authorized and registered and available for sale by the Fund,
including redeemed or repurchased Shares if and to the extent that
they may be legally sold and if, but only if, the Fund authorizes
the Distributor to sell them.

8. Public Offering Price. The public offering price for the
Fund's Shares will be the net asset value per Share next
determined by the Fund after the Distributor or its appointed
agent receives the order plus any sales charge as set forth in the
Fund's Prospectus. The net asset value per Share shall be
determined in the manner provided in the Fund's Agreement and
Declaration of Trust as now in effect or as they may be amended,
and as reflected in the Fund's then current Prospectus and SAI.

9. Compensation.

(a) Sales Charge. Distributor shall be entitled to charge a
sales charge on the sale or redemption, as appropriate,
of each series and class of each Fund's Shares as set
forth in the Fund's then current Prospectus. Distributor
may allow any dealers with which it has signed selling
agreements such commissions or discounts from and not
exceeding the total sales charge as Distributor shall
deem advisable, so long as any such commissions or
discounts are set forth in the Fund's current Prospectus
to the extent required by the applicable federal and
state securities laws. Distributor may also make
payments to dealers from Distributor's own resources,
subject to the following conditions: (a) any such
payments shall not create any obligation for or recourse
against the Fund or any series or class, and (b) the
terms and conditions of any such payments are consistent
with the Fund's Prospectus and applicable federal and
state securities laws and are disclosed in the Prospectus
or SAI to the extent such laws may require.

(b) Distribution Plans. Distributor shall also be entitled
to compensation for its services as provided in any
Distribution Plan adopted as to any series and class of
any Fund's Shares pursuant to Rule 12b-1 under the 1940
Act.

10. Suspension of Sales. If and whenever the determination
of the Fund's net asset value is suspended and until such
suspension is terminated, the Distributor shall not accept orders
for Shares except for unconditional orders placed before the
suspension. In addition, the Fund reserves the right to suspend
sales of Shares if, in the judgment of the Board of the Fund, it
is in the best interest of the Fund to do so, such suspension to
continue for such period as may be determined by the Board of the
Fund; and in that event, (i) at the direction of the Fund,
Distributor shall suspend receipt and acceptance of orders to
purchase Shares of the Fund until otherwise instructed by the Fund
and (ii) the Distributor shall not accept orders to purchase
Shares while such suspension remains in effect unless otherwise
directed by the Board.

11. Orders and Payment for Shares.

(a) Distributor shall direct orders for the purchase of
Shares of any series to the Fund's transfer agent. At or
prior to the time of delivery of any Shares the
Distributor will pay or cause to be paid to the custodian
of the Fund's assets, for the account of such series, an
amount in cash equal to the purchase price of such
Shares. The Fund's custodian and transfer agent shall be
identified in its Prospectus.

(b) The Fund, or any agent of the Fund designated in writing
by the Fund, shall be promptly advised of all purchase
orders for Fund Shares received by the Distributor. Any
order may be rejected by the Fund; provided, however,
that the Fund will not arbitrarily or without reasonable
cause refuse to accept or confirm orders for the purchase
of Fund Shares from eligible investors.

12. Repurchase or Redemption of Shares by the Fund.

(a) Any of the outstanding Fund Shares may be tendered to the
transfer agent for redemption at any time, other than
when the Fund suspends redemptions as permitted by the
Prospectus or applicable law, and the Fund agrees to
repurchase or redeem the Shares so tendered in accordance
with its obligations as set forth in its Agreement and
Declaration of Trust, as amended from time to time, and
in accordance with the applicable provisions set forth
in the Prospectus and SAI. The price to be paid to
redeem or repurchase the Shares shall be equal to the net
asset value calculated in accordance with the provisions
of the Fund's Prospectus and SAI, less any contingent
deferred sales charge ("CDSC"), redemption fee or other
charge(s), if any, set forth in the Prospectus or SAI of
the Fund. All payments by the Fund hereunder shall be
made in the manner set forth below.

(b) If Shares are tendered to the transfer agent for
redemption or repurchase by the Fund within seven
business days after Distributor's acceptance of the
original purchase order for such Shares, Distributor will
immediately refund to the Fund the full sales commission
(net of allowances to dealers or brokers) allowed to
Distributor on the original sale, and will promptly, upon
receipt thereof, pay to the Fund any refunds from dealers
or brokers of the balance of sales commissions reallowed
by Distributor. The transfer agent shall notify
Distributor of such tender for redemption within ten days
of the day on which notice of such tender for redemption
is received by the transfer agent.

(c) The transfer agent shall pay the total amount of the
redemption price as defined in the above paragraph 12(a),
pursuant to the instructions of the Distributor in
Federal Funds on or before the seventh business day
subsequent to its having received the notice of
redemption in proper form except as otherwise provided in
the Prospectus or SAI of the Fund. The proceeds of any
redemption of Shares shall be paid by the transfer agent
as follows: (i) any applicable CDSC shall be paid to the
Distributor, and (ii) the balance shall be paid to or for
the account of the shareholder, in each case in
accordance with the applicable provision of the
Prospectus and SAI.

13. Purchases for your own Account. Distributor may
purchase Shares for its own investment account upon Distributor's
written assurance that the purchase is for investment purposes and
that the Shares will not be resold except through redemption by
the Fund.

14. Stein Roe & Farnham Incorporated Investment Programs.
In connection with any program under which Stein Roe & Farnham
Incorporated or one of its affiliates offers investment advice to
shareholders, the Distributor is authorized to offer and sell
Shares of the Fund, as principal, to participants in such program.
The terms of this Agreement shall apply to such sales, including
terms as to the offering price of Shares, the proceeds to be paid
to the Fund, the duties of the Distributor, the payment of
expenses and indemnification obligations of the Fund and the
Distributor.

15. Authorized Representations. No Fund is authorized by
the Distributor to give on behalf of the Distributor any
information or to make any representations other than the
information and representations contained in the Fund's
registration statement filed with the SEC under SA-33 and/or ICA-
40 as it may be amended from time to time.

16. Registration of Additional Shares. The Fund hereby
agrees to register an indefinite number of Shares pursuant to Rule
24f-2 under ICA-40, as amended. The Fund will, in cooperation
with the Distributor, take such action as may be necessary from
time to time to qualify the Shares (so registered or otherwise
qualified for sale under SA-33), in any state mutually agreeable
to the Distributor and the Fund, and to maintain such
qualification; provided, however, that nothing herein shall be
deemed to prevent the Fund from registering its Shares without
approval of the Distributor in any state it deems appropriate.

17. Conformity With Law. Distributor agrees that in
soliciting orders to purchase Shares it shall duly conform in all
respects with applicable federal and state laws and the rules and
regulations of the NASD. Distributor will use its best efforts to
maintain its registrations in good standing during the term of
this Agreement and will promptly notify the Fund and Stein Roe &
Farnham Incorporated in the event of the suspension or termination
of any of the registrations.

18. Independent Contractor. Distributor shall be an
independent contractor and neither the Distributor, nor any of its
officers, directors, employees, or representatives is or shall be
an employee of the Fund in the performance of Distributor's duties
hereunder. Distributor shall be responsible for its own conduct
and the employment, control, and conduct of its agents and
employees and for injury to such agents or employees or to others
through its agents and employees and agrees to pay all employee
taxes thereunder. Distributor may appoint sub-agents or
distribute through dealers or otherwise as Distributor may
determine from time to time, but this Agreement shall not be
construed as authorizing any dealer or other person to accept
orders for sale or repurchase on the Fund's behalf or otherwise
act as the Fund's agent for any purpose.

19. Indemnification. Distributor agrees to indemnify and
hold harmless the Fund and each of the members of its Board and
its officers, employees and representatives and each person, if
any, who controls the Fund within the meaning of Section 15 of SA-
33 against any and all losses, liabilities, damages, claims and
expenses (including the reasonable costs of investigating or
defending any alleged loss, liability, damage, claim or expense
and reasonable legal counsel fees incurred in connection
therewith) to which the Fund or such of the members of its Board
and of its officers, employees, representatives, or controlling
person or persons may become subject under SA-33, under any other
statute, at common law, or otherwise, arising out of or based upon
(i) any violation of an applicable law, rule or regulation or
wrongful act by Distributor or any of Distributor's directors,
officers, employees or representatives, or (ii) any untrue
statement or alleged untrue statement of a material fact contained
in a registration statement, Prospectus, SAI, shareholder report
or other information covering Shares of the Fund filed or made
public by the Fund or any amendment thereof or supplement thereto
or the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission
was made in reliance upon information furnished to the Fund by
Distributor in writing. In no case (i) is Distributor's indemnity
in favor of the Fund, or any person indemnified, to be deemed to
protect the Fund or such indemnified person against any liability
to which the Fund or such person would otherwise be subject by
reason of willful misfeasance, bad faith, or negligence in the
performance of its or his duties or by reason of its or his
reckless disregard of its or his obligations and duties under this
Agreement or (ii) is Distributor to be liable under its indemnity
agreement contained in this paragraph with respect to any claim
made against the Fund or any person indemnified unless the Fund or
such person, as the case may be, shall have notified Distributor
in writing of the claim within a reasonable time after the
summons, or other first written notification, giving information
of the nature of the claim served upon the Fund or upon such
person (or after the Fund or such person shall have received
notice of such service on any designated agent). However, failure
to notify Distributor of any such claim shall not relieve
Distributor from any liability which Distributor may have to the
Fund or any person against whom such action is brought otherwise
than on account of Distributor's indemnity agreement contained in
this Paragraph.

Distributor shall be entitled to participate, at its own
expense, in the defense, or, if Distributor so elects, to assume
the defense of any suit brought to enforce any such claim but, if
Distributor elects to assume the defense, such defense shall be
conducted by legal counsel chosen by Distributor and satisfactory
to the persons indemnified who are defendants in the suit. In the
event that Distributor elects to assume the defense of any such
suit and retain such legal counsel, persons indemnified who are
defendants in the suit shall bear the fees and expenses of any
additional legal counsel retained by them. If Distributor does
not elect to assume the defense of any such suit, Distributor will
reimburse persons indemnified who are defendants in such suit for
the reasonable fees of any legal counsel retained by them in such
litigation.

The Fund agrees to indemnify and hold harmless Distributor
and each of its directors, officers, employees, and
representatives and each person, if any, who controls Distributor
within the meaning of Section 15 of SA-33 against any and all
losses, liabilities, damages, claims or expenses (including the
damage, claim or expense and reasonable legal counsel fees
incurred in connection therewith) to which Distributor or such of
its directors, officers, employees, representatives or controlling
person or persons may become subject under SA-33, under any other
statute, at common law, or otherwise arising out of or based upon
(i) any violation of applicable law, rule or regulation or
wrongful act by the Fund or any of the members of the Fund's
Board, or the Fund's officers, employees or representatives other
than Distributor, or (ii) any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, Prospectus, SAI, shareholder report or other
information covering Shares filed or made public by the Fund or
any amendment thereof or supplement thereto, or the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading unless such statement or omission was made in reliance
upon information furnished by Distributor to the Fund. In no case
(i) is the Fund's indemnity in favor of the Distributor or any
person indemnified to be deemed to protect the Distributor or such
indemnified person against any liability to which Distributor or
such indemnified person would otherwise be subject by reason of
willful misfeasance, bad faith, or negligence in the performance
of its or his duties or by reason of its or his reckless disregard
of its or his obligations and duties under this Agreement, or (ii)
is the Fund to be liable under its indemnity agreement contained
in this Paragraph with respect to any claim made against
Distributor or any person indemnified unless Distributor, or such
person, as the case may be, shall have notified the Fund in
writing of the claim within a reasonable time after the summons,
or other first written notification, giving information of the
nature of the claim served upon Distributor or upon such person
(or after Distributor or such person shall have received notice of
such service on any designated agent). However, failure to notify
a Fund of any such claim shall not relieve the Fund from any
liability which the Fund may have to Distributor or any person
against whom such action is brought otherwise than on account of
the Fund's indemnity agreement contained in this Paragraph.

The Fund shall be entitled to participate, at its own
expense, in the defense or, if the Fund so elects, to assume the
defense of any suit brought to enforce such claim but, if the Fund
elects to assume the defense, such defense shall be conducted by
legal counsel chosen by the Fund and satisfactory to the persons
indemnified who are defendants in the suit. In the event that the
Fund elects to assume the defense of any such suit and retain such
legal counsel, the persons indemnified who are defendants in the
suit shall bear the fees and expenses of any additional legal
counsel retained by them. If the Fund does not elect to assume
the defense of any such suit, the Fund will reimburse the persons
indemnified who are defendants in such suit for the reasonable
fees and expenses of any legal counsel retained by them in such
litigation.

20. Duration and Termination of this Agreement. With
respect to the Fund and the Distributor, this Agreement shall
become effective upon its execution ("Effective Date") and unless
terminated as provided herein, shall remain in effect through June
30, 1998, and from year to year thereafter, but only so long as
such continuance is specifically approved at least annually (a) by
a vote of majority of the members of the Board of the Fund who are
not interested persons of the Distributor or of the Fund, voting
in person at a meeting called for the purpose of voting on such
approval, and (b) by the vote of either the Board of the Fund or a
majority of the outstanding Shares of the Fund. This Agreement
may be terminated by and between an individual Fund and
Distributor at any time, without the payment of any penalty (a) on
60 days' written notice, by the Board of the Fund or by a vote of
a majority of the outstanding Shares of the Fund, or by
Distributor, or (b) immediately, on written notice by the Board of
the Fund, in the event of termination or suspension of any of the
Registrations. This Agreement will automatically terminate in the
event of its assignment. In interpreting the provisions of this
Paragraph 20 the definitions contained in Section 2(a) of ICA-40
(particularly the definitions of "interested person",
"assignment", and "majority of the outstanding Shares") shall be
applied.

21. Amendment of this Agreement. No provision of this
Agreement may be changed, waived, discharged, or terminated
orally, but only by an instrument in writing signed by each party
against which enforcement of the change, waiver, discharge, or
termination is sought. If the Fund should at any time deem it
necessary or advisable in the best interests of the Fund that any
amendment of this Agreement be made in order to comply with the
recommendations or requirements of the SEC or any other
governmental authority or to obtain any advantage under state or
Federal tax laws and notifies Distributor of the form of such
amendment, and the reasons therefor, and if Distributor should
decline to assent to such amendment, the Fund may terminate this
Agreement forthwith. If Distributor should at any time request
that a change be made in the Fund's Agreement and Declaration of
Trust or By-Laws or in its methods of doing business, in order to
comply with any requirements of Federal law or regulations of the
SEC, or of a national securities association of which Distributor
is or may be a member, relating to the sale of Shares, and the
Fund should not make such necessary changes within a reasonable
time, Distributor may terminate this Agreement forthwith.

22. Liability. It is understood and expressly stipulated
that neither the shareholders of the Fund nor the members of the
Board of the Fund shall be personally liable hereunder. The
obligations of the Fund are not personally binding upon, nor shall
resort to the private property of, any of the members of the Board
of the Fund, nor of the shareholders, officers, employees or
agents of the Fund, but only the Fund's property shall be bound.
A copy of the Declaration of Trust and of each amendment thereto
has been filed by the Trust with the Secretary of State of The
Commonwealth of Massachusetts and with the Clerk of the City of
Boston, as well as any other governmental office where such filing
may from time to time be required.

23. Miscellaneous. The captions in this Agreement are
included for convenience or reference only, and in no way define
or limit any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one
and the same instrument.

24. Notice. Any notice required or permitted to be given by
a party to this Agreement or to any other party hereunder shall be
deemed sufficient if delivered in person or sent by registered or
certified mail, postage prepaid, addressed by the party giving
notice to each such other party at the address provided below or
to the last address furnished by each such other party to the
party giving notice.

If to the Fund: One South Wacker Drive
Chicago, Illinois 60606
Attn: Secretary

If to Distributor: One Financial Center
Boston, Massachusetts 02111
Attn: Secretary

LIBERTY FUNDS DISTRIBUTOR, INC.

By:_____________________________
ATTEST:

_______________________

LIBERTY-STEIN ROE ADVISOR TRUST

By: THOMAS W. BUTCH
Thomas W. Butch
President
ATTEST:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

<PAGE>

Schedule A to Underwriting Agreement
Between the Liberty-Stein Roe Advisor Trust and
Liberty Funds Distributor, Inc.

The series of the Trust covered by this agreement are:

Name of Series Effective Date
- ---------------------------------------------- --------------
Stein Roe Advisor Growth & Income Fund, Class K August 4, 1999
Stein Roe Advisor Young Investor Fund, Class A August 4, 1999
Stein Roe Advisor Young Investor Fund, Class K August 4, 1999
Stein Roe Advisor Growth Stock Fund, Class A August 4, 1999
Stein Roe Advisor Growth Stock Fund, Class B August 4, 1999
Stein Roe Advisor Growth Stock Fund, Class C August 4, 1999
Stein Roe Advisor Growth Stock Fund, Class K August 4, 1999
Stein Roe Advisor Intermediate Bond Fund,
Class K August 4, 1999
Stein Roe Advisor High-Yield Municipals Fund,
Class K August 4, 1999

Dated: August 4, 1999

TRANSFER AGENT AGREEMENT

Agreement dated as of October 15, 1997, between Stein Roe
Advisor Trust, a Massachusetts business trust (the "Trust")
comprised of the series of portfolios listed in Schedule A (as the
same may from time to time be amended to add or to delete one or
more series, all referred to herein as the "Fund"), and Colonial
Investors Service Center, Inc. ("CISC"), a Massachusetts
corporation.

WHEREAS, the Trust has appointed CISC as Transfer Agent,
Registrar and Dividend Disbursing Agent for each series of the
Trust listed in Schedule A, each a registered investment company,

WHEREAS, CISC desires to accept such appointment and to
perform such services upon the terms and subject to the conditions
set forth herein; and

WHEREAS, Stein Roe & Farnham, Inc. ("SRF") is the investment
adviser to the Fund and Liberty Financial Investments, Inc. is the
principal distributor ("Distributor") of its shares.

NOW THEREFORE, in consideration of the mutual promises and
covenants set forth herein, the parties hereto agree as follows:

1. APPOINTMENT. The Trust hereby appoints CISC to act as
its agent in respect of the purchase, redemption and transfer of
Fund shares and dividend disbursing services in connection with
such shares other than with respect to Fund shares held in omnibus
accounts as to which such services are performed by other
financial institutions as described in the Fund's Prospectus from
time to time. CISC accepts such appointment and will perform the
duties and functions described herein in the manner hereinafter
set forth.

CISC agrees to provide the necessary facilities, equipment
and personnel to perform its duties and obligations hereunder in
accordance with the practice of transfer agents of investment
companies registered with the Securities and Exchange Commission
and in compliance with all laws applicable to mutual fund transfer
agents and the Fund.

CISC agrees that it shall perform usual and ordinary services
as transfer agent, registrar and dividend disbursing agent, which
are necessary and appropriate for investment companies registered
with the Securities and Exchange Commission, except as otherwise
specifically excluded herein, including but not limited to:
receiving and processing payments for purchases of Fund shares,
opening shareholder accounts, receiving and processing requests
for liquidation of Fund shares, transferring and canceling stock
certificates, maintaining all shareholder accounts, preparing
annual shareholder meetings lists, mailing proxy materials,
receiving and tabulating proxies, mailing shareholder reports and
prospectuses, account research, shareholder correspondence and
telephone services, providing order room services to brokers,
withholding taxes on accounts, disbursing income dividends and
capital gains distributions, preparing and filing U.S. Treasury
Department Form 1099 for shareholders, preparing and mailing
confirmation forms to shareholders for all purchases and
liquidations of Fund shares and other confirmable transactions in
shareholder accounts, recording reinvestment of dividends and
distributions in Fund shares, and causing liquidation of shares
and disbursements to be made to withdrawal plan holders.

2. FEES AND CHARGES. The Trust will pay to CISC for the
services provided hereunder in accordance with and in the manner
set forth in Schedule B to this Agreement.

3. REPRESENTATIONS AND WARRANTIES OF CISC. CISC represents
and warrants to the Trust that:

(a) It is a corporation duly organized and existing in good
standing under the laws of the Commonwealth of
Massachusetts;

(b) It is duly qualified to carry on its business in the
Commonwealth of Massachusetts;

(c) It is empowered under applicable state and federal laws
and by its Articles of Organization and By-Laws to enter
into and perform the services contemplated by this
Agreement and it is in compliance and shall continue
during the term of this Agreement to be in compliance
with all such applicable laws;

(d) All requisite corporate proceedings have been taken to
authorize it to enter into and perform this Agreement;

(e) It has and shall continue to have and maintain the
necessary facilities, equipment and personnel to perform
its duties and obligations under this Agreement; and

(f) It has filed a Registration Statement on SEC Form TA-1
and will file timely an amendment to same respecting this
Transfer Agent Agreement with the Securities and Exchange
Commission; it is duly registered as a transfer agent as
provided in Section 17Ac of the Securities and Exchange
Act of 1934, and it will remain so registered and will
comply with all state and federal laws and regulations
relating to transfer agents throughout the term of this
Agreement.

4. REPRESENTATIONS AND WARRANTIES OF TRUST. The Trust
represents and warrants to CISC that:

(a) It is a business trust duly organized and existing in
good standing under the laws of the State of
Massachusetts;

(b) The Fund is an open-end diversified management investment
company registered under the Investment Company Act of
1940;

(c) Registration statements under the Securities Act of 1933
and applicable state laws are currently effective and
will remain effective at all times with respect to all
shares of the Fund being offered for sale;

(d) The Trust is empowered under applicable laws and
regulations and by its Agreement and Declaration of Trust
and By-Laws to enter into and perform this Agreement;

(e) All requisite proceedings and actions have been taken to
authorize it to enter into and perform this Agreement.

5. COPIES OF DOCUMENTS. The Trust promptly from time to
time will furnish CISC with copies of the following Trust and Fund
documents and all amendments or supplements thereto: the
Agreement and Declaration of Trust; the By-Laws; and the
Registration Statement under the Securities Act of 1933, as
amended, and the Investment Company Act of 1940, as amended,
together with any other information reasonably requested by CISC.
The Prospectus and Statement of Additional Information contained
in such Registration Statement, as from time to time amended and
supplemented, are herein collectively referred to as the
"Fund's Prospectus."

On or before the date of effectiveness of this Agreement, or as
soon thereafter as is reasonably practicable, and from time-to-
time thereafter, the Trust will furnish CISC with certified copies
of resolutions of the Trustees of the Trust authorizing this
Agreement and designating authorized persons to give instructions
to CISC; if applicable, a specimen of the certificate for shares
of the Fund in the form approved by the Trustees of the Trust,
with a certificate of the Secretary of the Trust as to such
approval; and certificates as to any change in any officer,
director, or authorized person of the Trust.

6. SHARE CERTIFICATES. Unless and until the Trustees of the
Trust resolve that all of the Trust's shares of beneficial
interests, or all of the shares of a particular series or class of
such shares, shall be issued in uncertificated form, CISC shall
maintain a sufficient supply of blank share certificates
representing such shares, in the form approved from time to time
by the Trustees of the Trust. Such blank share certificates shall
be properly signed, manually or by facsimile signature by the duly
authorized officers of the Trust, and shall bear the seal or
facsimile thereof of the Trust; and notwithstanding the death,
resignation or removal of any officer of the Trust authorized to
sign such share certificates, CISC may continue to countersign
certificates which bear the manual or facsimile signature of such
officer until otherwise directed by the Trust.

7. LOST OR DESTROYED CERTIFICATES. In case of the alleged
loss or destruction of any share certificate, no new certificate
shall be issued in lieu thereof, unless there shall first be
furnished to CISC an affidavit of loss or non-receipt by the
holder of shares with respect to which a certificate has been lost
or destroyed, supported by an appropriate bond paid for by the
shareholder which is satisfactory to CISC and issued by a surety
company satisfactory to CISC. CISC shall place and maintain stop
transfer instructions on all lost certificates as to which it
receives notice.

8. PURCHASES; RECEIPT OF FUNDS FOR INVESTMENT. CISC will
maintain one or more accounts with BankBoston, N.A. ("Bank"), in
the name, or for the benefit, of the Trust into which it will
deposit funds payable to CISC or SteinRoe Services, Inc. as agent
for, or otherwise identified as being for the account of, the
Trust, prior to crediting such funds to the respective accounts of
the Trust and the Distributor.

Thereafter, CISC will determine the amount of any such funds
due the Trust (equal to the number of Trust shares sold by the
Trust computed pursuant to paragraph 9 hereof, multiplied by the
net asset value of Trust share next determined after receipt of
such purchase order) and the amount of funds due to the
Distributor (equal to the sales charge applicable to such sale,
computed pursuant to the Prospectus), respectively, deposit the
portion due the Distributor in its account with such bank as may
from time to time be designated by the Distributor ("Distributor's
Account"), deposit the net amount due the Trust in its account
with the financial institution from time to time selected by the
Trust as custodian of the Fund ("Custodian"), and notify the
Distributor and the Custodian, respectively, (such notification to
the Distributor to include the amount of such sales charge to be
remitted by the Distributor to the dealer participating in the
sale, of such deposits, such notification to be given as soon as
practicable on the next business day stating the total amount
deposited to said accounts during the previous business day.

9. SHAREHOLDER ACCOUNTS. Upon receipt of any funds referred
to in paragraph 8, CISC will compute the number of shares
purchased by the shareholder according to the appropriate offering
price of Fund shares determined in accordance with applicable
federal laws and regulations and as described in the Prospectus of
the Fund, and:

(a) In the case of a new shareholder, open and maintain an
open account for such shareholder in the name or names
set forth in the subscription application form;

(b) Unless the Trustees of the Trust have resolved that all
of the Trust's shares of beneficial interest, or all of
the shares of a particular series or class, shall be
issued in uncertificated form, and if specifically
requested in writing by the shareholder, countersign,
issue and mail, by first class mail, to the shareholder
at his or her address a share certificate for full shares
purchased;

(c) Send to the shareholder a confirmation indicating the
amount of full and fractional shares purchased (in the
case of fractional shares, rounded to three decimal
places) and the price per share;

(d) In the case of a request to establish a plan or program
being offered by the Fund's Prospectus, open and maintain
such plan or program for the shareholder in accordance
with the terms thereof; and

(e) Perform such other services and initiate and maintain
such other books and records as are customarily
undertaken by transfer agents in maintaining shareholder
accounts for registered investment company investors;

all subject to any requirements set forth in the Fund's Prospectus
with respect to rejection of orders.

For closed accounts, CISC will maintain account records
through June of the calendar year following the year in which the
account closed.

10. UNPAID CHECKS; ACCOUNTS ASSIGNED FOR COLLECTION. If any
check or other order for payment of money on the account of any
shareholder or new investor is returned for any reason, CISC will:

(a) Give prompt notification to the Distributor of such
non-payment; and

(b) Take such other steps, including imposition of a
reasonable processing or handling fee, as CISC may, in
CISC's discretion, deem appropriate, or as the Trust or
the Distributor may instruct CISC, provided that any
authorization to pay such order notwithstanding
insufficient shareholder account funds, is expressly on
the condition that the Trust or Distributor, as the case
may be, shall indemnify CISC and payor bank in respect of
such payment.

11. DIVIDENDS AND DISTRIBUTIONS. The Trust will promptly
notify CISC of the declaration of any dividend or distribution
with respect to Fund shares, the amount of such dividend or
distribution, the date each such dividend or distribution shall
be paid, and the record date for determination of shareholders
entitled to receive such dividend or distribution. As dividend
disbursing agent, CISC will, on or about the payment date of
any such dividend or distribution, notify the Custodian of the
estimated amount of cash required to pay such dividend or
distribution, and the Trust agrees that on or before the mailing
date of such dividend or distribution it will instruct the
Custodian to make available to CISC sufficient funds in the
dividend and distribution account maintained by CISC with the
Bank. As dividend disbursing agent, CISC will prepare and
distribute to shareholders any funds to which they are entitled by
reason of any dividend or distribution and, in the case of
shareholders entitled to receive additional shares by reason of
any such dividend or distribution, CISC will make appropriate
credits to their accounts and cause to be prepared and mailed to
shareholders confirmation statements and, of such additional
shares. CISC will maintain all records necessary to reflect the
crediting of dividends and distributions which are reinvested in
shares of the Fund.

12. REDEMPTIONS. As agent for the Trust, CISC will receive
and process in accordance with the Fund's Prospectus, share
certificates and requests for redemptions of shares, as follows:

(a) If such certificate or request complies with standards
for redemption, CISC will notify the Custodian of the
actual amount of cash required to pay redemptions, and
the Trust hereby instructs the Custodian to make
available to CISC sufficient funds in the redemption
account maintained by CISC with the Bank. CISC will
deposit any contingent deferred sales charge ("CDSC") due
the Distributor in accordance with the Fund's Prospectus,
in the Distributor's Account and pay to the shareholder
from funds deposited from time to time in the redemption
account maintained by CISC with the Bank, the appropriate
redemption price as set forth in the Fund's Prospectus;

(b) If such certificate or request does not comply with the
standards for redemption, CISC will promptly notify the
shareholder and shall effect the redemption at the price
in effect at the time of receipt of documents complying
with the standard; and

(c) CISC shall notify the Trust and the Distributor as soon
as practicable on each business day of the total number
of Trust shares and funds covered by requests for
redemption which were received by CISC in proper form on
the previous business day, and shall notify the
Distributor of deposits to its account with respect to
any CDSC.

13. TRANSFER AND EXCHANGES. CISC will receive and process
transfers of shares of the Fund and exchanges between series of
the Trust and other investments as, and to the extent, permitted
in the Prospectus of the Fund. If shares to be transferred are
represented by outstanding certificates, CISC will, upon surrender
to it of the certificates in proper form for transfer, credit the
same to the transferee on its books. If shares are to be
exchanged, CISC will process such exchange in the same manner as a
redemption and sale of shares, in accordance with the Fund's
Prospectus.

14. SYSTEMATIC WITHDRAWAL PLANS. CISC will administer
systematic withdrawal plans pursuant to the provisions of
withdrawal orders duly executed by shareholders and the Fund's
Prospectus. Prior to the payment date, CISC will withdraw from a
shareholder's account and present for redemption as many shares as
shall be sufficient to make such withdrawal payment pursuant to
the provisions of the shareholder's withdrawal plan and the
Prospectus.

15. LETTERS OF INTENT AND OTHER PLANS. CISC will process
such letters of intent for investing in shares as are provided
for in the Prospectus, and CISC will act as escrow agent
pursuant to the terms of such letters of intent duly executed by
shareholders. CISC will make appropriate deposits for the
adjustment of sales charges as therein provided and will currently
report the same to the Distributor, it being understood, however,
that computations of any adjustment of sales charge shall be the
responsibility of the Distributor or the Trust. CISC will process
such accumulation plans, group programs and other plans or
programs for investing in shares as are provided for in the
Prospectus.

16. TAX RETURNS AND REPORTS. CISC will prepare and file tax
returns and reports with the Internal Revenue Service and any
other federal, state or local governmental agency which may
require such filings, including state abandoned property laws, and
conduct appropriate communications relating thereto, and, if
required, mail to shareholders such forms for reporting dividends
and distributions paid by the Fund as are required by applicable
laws, rules and regulations, and CISC will withhold such sums as
are required to be withheld under applicable Federal and state
income tax laws, rules and regulations. CISC will also make
reasonable attempt to obtain such tax withholding information from
shareholders as is required to be obtained on behalf of the Trust
under applicable federal or state laws.

17. RECORD KEEPING. CISC will maintain records, which at
all times will be the property of the Trust and available for
inspection by the Trust and Distributor, showing for each
shareholder's account the following information:

(a) Name, address, and United States taxpayer identification
or Social Security number, if provided (or amounts
withheld with respect to dividends and distributions on
shares if a taxpayer identification or Social Security
number is not provided);

(b) Number of shares held for which certificates have not
been issued and for which certificates have been issued;

(c) Historical information regarding the account of each
shareholder, including dividends and distributions paid,
if any, and the date and price for all transactions on a
shareholder's account;

(d) Any stop or restraining order placed against a
shareholder's account;

(e) Information with respect to withholdings of taxes as
required under applicable Federal and state laws and
regulations;

(f) Any capital gain or dividend reinvestment order and plan
application relating to the current maintenance of a
shareholder's account; and

(g) Any instructions as to letters of intent, record address,
and any correspondence or instructions relating to the
current maintenance of a shareholder's account.

CISC shall maintain at its expense those records necessary to
carry out its duties under this Agreement; remaining records will
be preserved at the Trust's expense for the periods prescribed by
law. In addition, CISC shall maintain at its expense for periods
prescribed by law all records which the Fund or CISC is required
to keep and maintain pursuant to any applicable statute, rule or
regulation, including without limitation, Rule 31(a)-1 under the
Investment Company Act of 1940, relating to the maintenance of
records in connection with the services to be provided hereunder.

At the end of the period in which records must be retained by
law, such records and documents will either be provided to the
Trust or destroyed in accordance with prior written authorization
from the Trust.

18. RETIREMENT PLAN SERVICES. CISC shall provide sub-
accounting services for retirement plan shareholders representing
group relationships with special recordkeeping needs.

19. OTHER INFORMATION FURNISHED. CISC will furnish to the
Trust and the Distributor such other information, including
shareholder lists and statistical information as may be agreed
upon from time to time between CISC, the Distributor, or the
Trust. CISC shall notify the Trust of any request or demand to
inspect the share records of the Fund, and will not permit or
refuse such inspection until receipt of written instructions from
the Trust as to such permission or refusal unless required by law.

CISC shall provide to the Trust any results of studies and
evaluations of systems of internal accounting controls performed
for the purpose of meeting the requirements of Regulation
240.17Ad-13(a) of the Securities Exchange Act.

20. SHAREHOLDER INQUIRIES. CISC will respond promptly to
written correspondence from shareholders, registered
representatives of broker-dealers engaged in selling Trust
shares, the Trust and the Distributor relating to its duties
hereunder. CISC also will respond to telephone inquiries from
shareholders with respect to existing accounts.

21. COMMUNICATIONS TO SHAREHOLDERS AND MEETINGS. CISC
will determine all shareholders entitled to receive, and will
cause to be addressed and mailed, all communications by the Fund
to its shareholders, including quarterly and annual statements or
reports, proxy material for meetings and periodic communications.
CISC will cause to be received, examined and tabulated return
proxy cards for meetings of shareholders and certify the vote to
the Trust.

22. INSURANCE. CISC will not reduce or allow to lapse any
of its insurance coverage from time to time in effect, including
but not limited to errors and omissions, fidelity bond and
electronic data processing coverage, without the prior written
consent of the Trust. Attached as Schedule D to this Agreement is
a list of the insurance coverage which CISC has in effect as of
the date of execution of this Agreement.

23. DUTY OF CARE AND INDEMNIFICATION. CISC will at all
times use reasonable care, due diligence and act in good faith in
performing its duties hereunder. CISC will not be liable or
responsible for delays or errors by reason of circumstances beyond
its control, including without limitation acts of civil or
military authority, national or state emergencies, labor
difficulties, fire, mechanical breakdown, flood or catastrophe,
acts of God, insurrection, war, riots or failure of
transportation, communication or power supply.

CISC may rely on certifications of those individuals
designated as authorized persons to give instructions to CISC as
to proceedings or facts in connection with any action taken by the
shareholders of the Fund or Trustees of the Trust, and upon
instructions not inconsistent with this Agreement from individuals
who have been so authorized. Upon receiving an authorization from
an individual designated as an authorized person to give
instructions to CISC, CISC may apply to counsel for the Trust, or
counsel for SRF, at the Fund's expense, for advice. With respect
to any action reasonably taken on the basis of such certifications
or instructions or in accordance with the advice of counsel of the
Trust, or counsel for SRF, the Trust will indemnify and hold
harmless CISC from any and all losses, claims, damages,
liabilities and expenses (including reasonable counsel fees and
expenses).

The Trust will indemnify CISC against and hold CISC harmless
from any and all losses, claims, damages, liabilities and expenses
(including reasonable counsel fees and expenses) in respect of any
claim, demand, action or suit not resulting from CISC's bad faith,
negligence, lack of due diligence or willful misconduct and
arising out of, or in connection with its duties under this
Agreement.

CISC shall indemnify the Trust against and hold the Trust harmless
from any and all losses, claims, damages, liabilities and
expenses(including reasonable counsel fees and expenses) in
respect to any claim, demand, action or suit resulting from CISC's
bad faith, negligence, lack of due diligence or willful
misconduct, and arising out of, or in connection with, its duties
under this Agreement. For purposes of this Transfer Agent
Agreement, "lack of due diligence" shall mean the processing by
CISC of a Fund share transaction in accordance with a practice
that is not substantially in compliance with (1) a transaction
processing practice approved by the Trust's Trustees, (2)
insurance coverage's, or (3) generally accepted industry practices
of mutual fund agents.

CISC shall also be indemnified and held harmless by the
Trust against any loss, claim, damage, liability and expenses
(including reasonable counsel fees and expenses) by reason of
any act done by it in good faith with due diligence and in
reasonable reliance upon any instrument or certificate for shares
believed by it (a) to be genuine and (b) to be signed,
countersigned or executed by any person or persons authorized to
sign, countersign, or execute such instrument or certificate.

In addition, the Trust will indemnify and hold CISC harmless
against any loss, claim, damage, liability and expense (including
reasonable counsel fees and expenses) in respect of any claim,
demand, action or suit as a result of the negligence of the Fund,
the Trust or SRO as a result of Disc's acting upon any
instructions reasonably believed by CISC to have been executed or
orally communicated by a duly authorized officer or employee of
the Fund, Trust or SRO as a result of acting in reliance upon
written or oral advice reasonably believed by CISC to have been
given by counsel for the Fund, Trust, or SRO.

In any case in which a party to this Agreement may be asked
to indemnify or hold harmless the other party hereto, the party
seeking indemnification shall advise the other party of all
pertinent facts concerning the situation giving rise to the
claim or potential claim for indemnification, and each party
shall use reasonable care to identify and notify the other
promptly concerning any situation which presents or appears
likely to present a claim for indemnification. Prior to admitting
to or agreeing to settle any claim subject to this Section, each
party shall give the other reasonable opportunity to defend
against said claim in either party's name.

25. TERMINATION AND AMENDMENT. This Agreement shall continue
in effect until May 1, 1998, and will automatically be renewed for
successive one year terms thereafter unless terminated, effective
as of the expiration of the then current term, by not less than
one hundred eighty (180) days written notice prior to any renewal
date. Upon termination hereof, the Trust shall pay CISC such
compensation as may be due to CISC as of the date of such
termination for services rendered and expenses incurred, as
described in Schedule B. This Agreement may be modified or
amended from time to time by mutual agreement between the Trust
and CISC.

26. SUCCESSORS. In the event that in connection with
termination of this Agreement a successor to any of CISC's
duties or responsibilities hereunder is designated by the Trust
by written notice to CISC, CISC shall promptly, at the expense of
the Trust, transfer to such successor a certificate list of the
shareholders of the Fund (with name, address and taxpayer
identification or Social Security number), a historical record of
the account of each shareholder and the status thereof, all other
relevant books, records, correspondence and other data established
or maintained by CISC under this Agreement in machine readable
form and will cooperate in the transfer of such duties and
responsibilities, and in the establishment of books, records and
other data by such successor. CISC shall be entitled to
reimbursement of its reasonable out-of-pocket expenses in respect
of assistance provided in accordance with the preceding sentence.

27. MISCELLANEOUS. This Agreement shall be construed in
accordance with and governed by the laws of The Commonwealth of
Massachusetts.

28. LIABILITY. It is understood and expressly stipulated
that neither the shareholders of the Funds which are series of the
Trust nor the members of the Board of the Trust shall be
personally liable hereunder. The obligations of the Trust are not
personally binding upon, nor shall resort be had to the private
property of, any of the members of the Board of the Trust, nor of
the shareholders, officers, employees or agents of the Trust, but
only the Trust's property shall be bound. A copy of the
Declaration of Trust and each amendment thereto has been filed by
the Trust with the Secretary of State of The Commonwealth of
Massachusetts and with the Clerk of the City of Boston, as well as
any other governmental office where such filing may from time to
time be required.

The captions in this Agreement are included for convenience
of reference only and in no way define or limit any of the
provisions of this Agreement or otherwise affect their
construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which taken together shall
constitute one and the same instrument.

CISC shall keep confidential all records and information
provided to CISC by the Trust, and prior, present or prospective
shareholders of the Fund, except to the extent disclosures are
required by this Agreement, by the Fund's registration statement,
or by a reasonable request or a valid subpoena or warrant issued
by a court, state or federal agency or other governmental
authority.

Neither CISC nor the Trust may use each other's name in any
written material without written consent of such other party,
provided, however, that such consent shall not unreasonably
withheld. CISC and the Trust hereby consent to all uses of their
respective names which refer in accurate terms to appointment and
duties under this Agreement or which are required by any
governmental or regulatory authority including required filings.
The Trust, the Fund and SRF consent to use of their respective
names and logos by CISC for shareholder correspondence and
statements.

This Agreement shall be binding upon and shall inure to the
benefit of the Trust and CISC and their respective successors and
assigns. Neither the Trust nor CISC shall assign this Agreement
nor its rights and obligations under this Agreement without the
express written consent of the other party.

This Agreement may be amended only in writing by mutual
agreement of the parties.

Any notice or other instrument in writing authorized or
required by this Agreement be given to the Trust or CISC shall be
sufficiently given if addressed to that party and mailed or
delivered to it as its office set for the below or at such other
place as it may from time to time designate in writing.

The Trust and the Fund:
Stein Roe Advisor Trust
One South Wacker Drive
Suite 3300
Chicago, Illinois 60606
Attn: General Counsel

CISC:
Colonial Investors Service Center, Inc.
One Financial Center
Boston, Massachusetts 02111
Attn: Mary McKenzie; with a separate copy to Attn:
Nancy Conlin, Esq., Legal Department

IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and sealed as of the date first
above written.

STEIN ROE ADVISOR TRUST

By: TIMOTHY K. ARMOUR
Name:
Title:

COLONIAL INVESTORS SERVICE CENTER, INC.

By: MARY D. MCKENZIE
Name: MARY D MCKENZIE
Title: President

Assented to for the limited purposes stated herein:

STEIN ROE & FARNHAM INCORPORATED

By: TIMOTHY K. ARMOUR
Name:
Title:

<PAGE>

SCHEDULE A

The Trust consists of the following series of portfolios:

Stein Roe Advisor Balanced Fund
Stein Roe Advisor Growth & Income Fund
Stein Roe Advisor Growth Stock Fund
Stein Roe Advisor Young Investor Fund
Stein Roe Advisor Special Fund
Stein Roe Advisor Special Venture Fund
Stein Roe Advisor International Fund

SCHEDULE B

Fees for transfer agency and shareholder services shall be
payable by each class of shares of the Fund at the applicable
annual percentage rate set forth below of the average daily
closing value of total net assets of each Fund share class:

Stein Roe Advisor Growth Stock Fund All Other Funds
----------------------------------- -----------------------
Class K 0.30 Class K 0.30
Class A 0.236 All Other Classes 0.30
Class B 0.236
Class C 0.236

In addition, CISC shall be entitled to retain as additional
compensation all amounts due CISC for account transcripts and
other agreed separately charged shareholder services.

The Fund shall reimburse CISC for (i) any and all out-of-
pocket expenses and charges in performing services including, but
not limited to, mailing service, postage, printing, stationery,
forms and other materials used in communicating with shareholders,
the costs of equipment or service used for communicating with the
Fund's custodian bank or other agents, and all costs of telephone
communication with or on behalf of shareholders, and (ii) banking
service charges.

The Fund shall be credited each month with balance credits
earned on Fund cash balances.

Payments under the Agreement shall be made monthly, within
two weeks following the month in which a service is rendered or an
expense incurred.

<PAGE>

STEIN ROE &
FARNHAM
Investment Management

As of October 15, 1997

Colonial Investors Service Center, Inc.
One Financial Center
Boston, MA 02111

Dear Sirs:

Reference is made to Transfer Agent Agreement dated as of October
15, 1997 between Stein Roe Advisor Trust, on behalf of each series
of the Trust from time to time issued and outstanding
(collectively, "Fund") and Colonial Investors Service Center, Inc.
("CISC") and assented to by Stein Roe & Farnham Incorporated
("Agreement").

Stein Roe & Farnham Incorporated hereby agrees to reimburse CISC
all networking account fees paid by CISC to dealer firms under the
Agreement on Fund shareholder accounts established or maintained
pursuant to the National Securities Clearing Corporation's
networking system.

Such reimbursement shall be in addition to other expenses and fees
described in Schedule B of the Agreement and shall be paid
monthly, within two weeks following the month in which incurred,
retroactive to the effective date of the Agreement.

Executed as a sealed instrument.

Very truly yours,

STEIN ROE & FARNHAM INCORPORATED

By: TIMOTHY K. ARMOUR
Name: Timothy K. Armour
Title: President

Stein Roe & Farnham Incorporated
One South Wacker Drive Chicago, IL 60606-4685 312.368.7700
Chicago Cleveland New York San Francisco San Juan
A Liberty Financial Company

<PAGE>

AMENDMENT TO TRANSFER AGENT AGREEMENT

This Amendment dated as of February 2, 1998, amends the
agreement dated as of October 15, 1997, as amended (the
"Agreement"), between Stein Roe Advisor Trust and Colonial
Investors Service Center, Inc. ("CISC") to add three series of
Advisor Trust to Schedule A. The Amended Schedule A is as
follows:

STEIN ROE ADVISOR TRUST
-----------------------
Stein Roe Advisor Balanced Fund
Stein Roe Advisor Growth & Income Fund
Stein Roe Advisor Growth Stock Fund
Stein Roe Advisor Young Investor Fund
Stein Roe Advisor Special Fund
Stein Roe Advisor Special Venture Fund
Stein Roe Advisor International Fund
Stein Roe Advisor Intermediate Bond Fund
Stein Roe Advisor Income Fund
Stein Roe Advisor High-Yield Municipals Fund

IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and sealed as of the date first
above written.

Stein Roe Advisor Trust

By: HEIDI J. WALTER
Name: Heidi J. Walter
Title: Vice President

Colonial Investors Service Center, Inc.

By: MARY D. MCKENZIE
Name: MARY D MCKENZIE
Title: PRESIDENT

<PAGE>

AMENDMENT TO TRANSFER AGENCY AGREEMENT

This Amendment dated as of December 15, 1998, amends the
agreement dated as of October 15, 1997, as amended (the
"Agreement"), between Liberty-Stein Roe Advisor Trust (f/k/a Stein
Roe Advisor Trust) and Liberty Funds Services, Inc. (f/k/a
Colonial Investors Service Center, Inc.) to remove four of Advisor
Trust to Schedule A.

LIBERTY-STEIN ROE ADVISOR TRUST
-----------------------
Stein Roe Advisor Growth & Income Fund
Stein Roe Advisor Growth Stock Fund
Stein Roe Advisor Young Investor Fund
Stein Roe Advisor Special Fund
Stein Roe Advisor Intermediate Bond Fund
Stein Roe Advisor High-Yield Municipals Fund
Stein Roe Retirement Investor Fund

IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and sealed as of the date first
above written.

LIBERTY-STEIN ROE ADVISOR TRUST

By: THOMAS W. BUTCH
Name: Thomas W. Butch
Title: President

LIBERTY FUNDS SERVICES, INC.

By: NANCY L. CONLIN
Name: Nancy L. Conlin
Title: Clerk

<PAGE>

ADMINISTRATIVE AGREEMENT
BETWEEN
STEIN ROE ADVISOR TRUST
AND
STEIN ROE & FARNHAM INCORPORATED

STEIN ROE ADVISOR TRUST, a Massachusetts business trust
registered under the Securities Act of 1933 ("1933 Act") and
the Investment Company Act of 1940 ("1940 Act") (the
"Trust"), hereby appoints STEIN ROE & FARNHAM INCORPORATED, a
Delaware corporation, of Chicago, Illinois ("Administrator"),
to furnish certain administrative services with respect to
the Trust and the series of the Trust listed in Schedule A
hereto, as such schedule may be amended from time to time
(each such series hereinafter referred to as "Fund").

The Trust and Administrator hereby agree that:

1. ADMINISTRATIVE SERVICES. Subject to the terms of
this Agreement and the supervision and control of the Trust's
Board of Trustees ("Trustees"), Administrator shall provide
the following services with respect to the Trust:

(a) Preparation and maintenance of the Trust's registration
statement with the Securities and Exchange Commission
("SEC");
(b) Preparation and periodic updating of the prospectus and
statement of additional information for the Fund
("Prospectus");
(c) Preparation, filing with appropriate regulatory
authorities, and dissemination of various reports for the
Fund, including but not limited to semiannual reports to
shareholders under Section 30(d) of the 1940 Act, annual
and semiannual reports on Form N-SAR, and notices
pursuant to Rule 24f-2;
(d) Arrangement for all meetings of shareholders, including
the collection of all information required for
preparation of proxy statements, the preparation and
filing with appropriate regulatory agencies of such proxy
statements, the supervision of solicitation of
shareholders and shareholder nominees in connection
therewith, tabulation (or supervision of the tabulation)
of votes, response to all inquiries regarding such
meetings from shareholders, the public and the media, and
preparation and retention of all minutes and all other
records required to be kept in connection with such
meetings;
(e) Maintenance and retention of all Trust charter documents
and the filing of all documents required to maintain the
Trust's status as a Massachusetts business trust and as a
registered open-end investment company;
(f) Arrangement and preparation and dissemination of all
materials for meetings of the Board of Trustees and
committees thereof and preparation and retention of all
minutes and other records thereof;
(g) Preparation and filing of the Trust's Federal, state, and
local income tax returns and calculation of any tax
required to be paid in connection therewith;
(h) Calculation of all Trust and Fund expenses and
arrangement for the payment thereof;
(i) Calculation of and arrangement for payment of all income,
capital gain, and other distributions to shareholders of
each Fund;
(j) Determination, after consultation with the officers of
the Trust, of the jurisdictions in which shares of
beneficial interest of each Fund ("Shares") shall be
registered or qualified for sale, or may be sold pursuant
to an exemption from such registration or qualification,
and preparation and maintenance of the registration or
qualification of the Shares for sale under the securities
laws of each such jurisdiction;
(k) Provision of the services of persons who may be appointed
as officers of the Trust by the Board of Trustees (it is
agreed that some person or persons may be officers of
both the Trust and the Administrator, and that the
existence of any such dual interest shall not affect the
validity of this Agreement except as otherwise provided
by specific provision of applicable law);
(l) Preparation and, subject to approval of the Trust's Chief
Financial Officer, dissemination of the Trust's and each
Fund's quarterly financial information to the Board of
Trustees and preparation of such other reports relating
to the business and affairs of the Trust and each Fund as
the officers and Board of Trustees may from time to time
reasonably request;
(m) Administration of the Trust's Code of Ethics and periodic
reporting to the Board of Trustees of Trustee and officer
compliance therewith;
(n) Provision of internal legal, accounting, compliance,
audit, and risk management services and periodic
reporting to the Board of Trustees with respect to such
services;
(o) Negotiation, administration, and oversight of third party
services to the Trust including, but not limited to,
custody, tax, transfer agency, disaster recovery, audit,
and legal services;
(p) Negotiation and arrangement for insurance desired or
required of the Trust and administering all claims
thereunder;
(q) Response to all inquiries by regulatory agencies, the
press, and the general public concerning the business and
affairs of the Trust, including the oversight of all
periodic inspections of the operations of the Trust and
its agents by regulatory authorities and responses to
subpoenas and tax levies;
(r) Handling and resolution of any complaints registered with
the Trust by shareholders, regulatory authorities, and
the general public;
(s) Monitoring legal, tax, regulatory, and industry
developments related to the business affairs of the Trust
and communicating such developments to the officers and
Board of Trustees as they may reasonably request or as
the Administrator believes appropriate;
(t) Administration of operating policies of the Trust and
recommendation to the officers and the Board of Trustees
of the Trust of modifications to such policies to
facilitate the protection of shareholders or market
competitiveness of the Trust and Fund and to the extent
necessary to comply with new legal or regulatory
requirements;
(u) Responding to surveys conducted by third parties and
reporting of Fund performance and other portfolio
information; and
(v) Filing of claims, class actions involving portfolio
securities, and handling administrative matters in
connection with the litigation or settlement of such
claims.

2. USE OF AFFILIATED COMPANIES AND SUBCONTRACTORS. In
connection with the services to be provided by Administrator
under this Agreement, Administrator may, to the extent it
deems appropriate, and subject to compliance with the
requirements of applicable laws and regulations and upon
receipt of approval of the Trustees, make use of (i) its
affiliated companies and their directors, trustees, officers,
and employees and (ii) subcontractors selected by
Administrator, provided that Administrator shall supervise
and remain fully responsible for the services of all such
third parties in accordance with and to the extent provided
by this Agreement. All costs and expenses associated with
services provided by any such third parties shall be borne by
Administrator or such parties.

3. INSTRUCTIONS, OPINIONS OF COUNSEL, AND SIGNATURES.
At any time Administrator may apply to a duly authorized
agent of Trust for instructions regarding the Trust, and may
consult counsel for the Trust or its own counsel, in respect
of any matter arising in connection with this Agreement, and
it shall not be liable for any action taken or omitted by it
in good faith in accordance with such instructions or with
the advice or opinion of such counsel. Administrator shall
be protected in acting upon any such instruction, advice, or
opinion and upon any other paper or document delivered by the
Trust or such counsel believed by Administrator to be genuine
and to have been signed by the proper person or persons and
shall not be held to have notice of any change of authority
of any officer or agent of the Trust, until receipt of
written notice thereof from the Trust.

4. EXPENSES BORNE BY TRUST. Except to the extent
expressly assumed by Administrator herein or under a separate
agreement between the Trust and Administrator and except to
the extent required by law to be paid by Administrator, the
Trust shall pay all costs and expenses incidental to its
organization, operations and business. Without limitation,
such costs and expenses shall include but not be limited to:

(a) All charges of depositories, custodians and other
agencies for the safekeeping and servicing of its cash,
securities, and other property;
(b) All charges for equipment or services used for obtaining
price quotations or for communication between
Administrator or the Trust and the custodian, transfer
agent or any other agent selected by the Trust;
(c) All charges for investment advisory, portfolio
management, and accounting services provided to the Trust
by the Administrator, or any other provider of such
services;
(d) All charges for services of the Trust's independent
auditors and for services to the Trust by legal counsel;
(e) All compensation of Trustees, other than those affiliated
with Administrator, all expenses incurred in connection
with their services to the Trust, and all expenses of
meetings of the Trustees or committees thereof;
(f) All expenses incidental to holding meetings of
shareholders, including printing and of supplying each
record-date shareholder with notice and proxy
solicitation material, and all other proxy solicitation
expenses;
(g) All expenses of printing of annual or more frequent
revisions of the Trust's prospectus(es) and of supplying
each then-existing shareholder with a copy of a revised
prospectus;
(h) All expenses related to preparing and transmitting
certificates representing the Trust's shares;
(i) All expenses of bond and insurance coverage required by
law or deemed advisable by the Board of Trustees;
(j) All brokers' commissions and other normal charges
incident to the purchase, sale, or lending of Fund
securities;
(k) All taxes and governmental fees payable to Federal, state
or other governmental agencies, domestic or foreign,
including all stamp or other transfer taxes;
(l) All expenses of registering and maintaining the
registration of the Trust under the 1940 Act and, to the
extent no exemption is available, expenses of registering
the Trust's shares under the 1933 Act, of qualifying and
maintaining qualification of the Trust and of the Trust's
shares for sale under securities laws of various states
or other jurisdictions and of registration and
qualification of the Trust under all other laws
applicable to the Trust or its business activities;
(m) All interest on indebtedness, if any, incurred by the
Trust or a Fund; and
(n) All fees, dues and other expenses incurred by the Trust
in connection with membership of the Trust in any trade
association or other investment company organization.

5. ALLOCATION OF EXPENSES BORNE BY TRUST. Any expenses
borne by the Trust that are attributable solely to the
organization, operation or business of a Fund shall be paid
solely out of Fund assets. Any expense borne by the Trust
which is not solely attributable to a Fund, nor solely to any
other series of shares of the Trust, shall be apportioned in
such manner as Administrator determines is fair and
appropriate, or as otherwise specified by the Board of
Trustees.

6. EXPENSES BORNE BY ADMINISTRATOR. Administrator at
its own expense shall furnish all executive and other
personnel, office space, and office facilities required to
render the services set forth in this Agreement. However,
Administrator shall not be required to pay or provide any
credit for services provided by the Trust's custodian or
other agents without additional cost to the Trust.

In the event that Administrator pays or assumes any
expenses of the Trust or a Fund not required to be paid or
assumed by Administrator under this Agreement, Administrator
shall not be obligated hereby to pay or assume the same or
similar expense in the future; provided that nothing
contained herein shall be deemed to relieve Administrator of
any obligation to the Trust or a Fund under any separate
agreement or arrangement between the parties.

7. ADMINISTRATION FEE. For the services rendered,
facilities provided, and charges assumed and paid by
Administrator hereunder, the Trust shall pay to Administrator
out of the assets of each Fund fees at the annual rate for
such Fund as set forth in Schedule B to this Agreement. For
each Fund, the administrative fee shall accrue on each
calendar day, and shall be payable monthly on the first
business day of the next succeeding calendar month. The
daily fee accrual shall be computed by multiplying the
fraction of one divided by the number of days in the calendar
year by the applicable annual rate of fee, and multiplying
this product by the net assets of the Fund, determined in the
manner established by the Board of Trustees, as of the close
of business on the last preceding business day on which the
Fund's net asset value was determined.

8. STATE EXPENSE LIMITATION. If for any fiscal year of
a Fund, its aggregate operating expenses ("Aggregate
Operating Expenses") exceed the applicable percentage expense
limit imposed under the securities law and regulations of any
state in which Shares of the Fund are qualified for sale (the
"State Expense Limit"), the Administrator shall pay such Fund
the amount of such excess. For purposes of this State
Expense Limit, Aggregate Operating Expenses shall (a) include
(i) any fees or expense reimbursements payable to
Administrator pursuant to this Agreement and (ii) to the
extent the Fund invests all or a portion of its assets in
another investment company registered under the 1940 Act, the
pro rata portion of that company's operating expenses
allocated to the Fund, and (iii) any compensation payable to
Administrator pursuant to any separate agreement relating to
the Fund's investment operations and portfolio management,
but (b) exclude any interest, taxes, brokerage commissions,
and other normal charges incident to the purchase, sale or
loan of securities, commodity interests or other investments
held by the Fund, litigation and indemnification expense, and
other extraordinary expenses not incurred in the ordinary
course of business. Except as otherwise agreed to by the
parties or unless otherwise required by the law or regulation
of any state, any reimbursement by Administrator to a Fund
under this section shall not exceed the administrative fee
payable to Administrator by the Fund under this Agreement.

Any payment to a Fund by Administrator hereunder shall
be made monthly, by annualizing the Aggregate Operating
Expenses for each month as of the last day of the month. An
adjustment for payments made during any fiscal year of the
Fund shall be made on or before the last day of the first
month following such fiscal year of the Fund if the Annual
Operating Expenses for such fiscal year (i) do not exceed the
State Expense Limitation or (ii) for such fiscal year there
is no applicable State Expense Limit.

9. NON-EXCLUSIVITY. The services of Administrator to
the Trust hereunder are not to be deemed exclusive and
Administrator shall be free to render similar services to
others.

10. STANDARD OF CARE. Neither Administrator, nor any
of its directors, officers or stockholders, agents or
employees shall be liable to the Trust, any Fund, or its
shareholders for any action taken or thing done by it or its
subcontractors or agents on behalf of the Trust or the Fund
in carrying out the terms and provisions of this Agreement if
done in good faith and without negligence or misconduct on
the part of Administrator, its subcontractors, or agents.

11. INDEMNIFICATION. The Trust shall indemnify and
hold Administrator and its controlling persons, if any,
harmless from any and all claims, actions, suits, losses,
costs, damages, and expenses, including reasonable expenses
for counsel, incurred by it in connection with its acceptance
of this Agreement, in connection with any action or omission
by it or its agents or subcontractors in the performance of
its duties hereunder to the Trust, or as a result of acting
upon any instruction believed by it to have been executed by
a duly authorized agent of the Trust or as a result of acting
upon information provided by the Trust in form and under
policies agreed to by Administrator and the Trust, provided
that: (i) to the extent such claims, actions, suits, losses,
costs, damages, or expenses relate solely to a particular
Fund or group of Funds, such indemnification shall be only
out of the assets of that Fund or group of Funds; (ii) this
indemnification shall not apply to actions or omissions
constituting negligence or misconduct of Administrator or its
agents or subcontractors, including but not limited to
willful misfeasance, bad faith, or gross negligence in the
performance of their duties, or reckless disregard of their
obligations and duties under this Agreement; and (iii)
Administrator shall give the Trust prompt notice and
reasonable opportunity to defend against any such claim or
action in its own name or in the name of Administrator.

Administrator shall indemnify and hold harmless the
Trust from and against any and all claims, demands, expenses
and liabilities which such Trust may sustain or incur arising
out of, or incurred because of, the negligence or misconduct
of Administrator or its agents or subcontractors, provided
that such Trust shall give Administrator prompt notice and
reasonable opportunity to defend against any such claim or
action in its own name or in the name of such Trust.

12. EFFECTIVE DATE, AMENDMENT, AND TERMINATION. This
Agreement shall become effective as to any Fund as of the
effective date for that Fund specified in Schedule A hereto
and, unless terminated as hereinafter provided, shall remain
in effect with respect to such Fund thereafter from year to
year so long as such continuance is specifically approved
with respect to that Fund at least annually by a majority of
the Trustees who are not interested persons of Trust or
Administrator.

As to any Trust or Fund of that Trust, this Agreement
may be modified or amended from time to time by mutual
agreement between the Administrator and the Trust and may be
terminated by Administrator or Trust by at least sixty (60)
days' written notice given by the terminating party to the
other party. Upon termination as to any Fund, the Trust
shall pay to Administrator such compensation as may be due
under this Agreement as of the date of such termination and
shall reimburse Administrator for its costs, expenses, and
disbursements payable under this Agreement to such date. In
the event that, in connection with a termination, a successor
to any of the duties or responsibilities of Administrator
hereunder is designated by the Trust by written notice to
Administrator, upon such termination Administrator shall
promptly, and at the expense of the Trust or Fund with
respect to which this Agreement is terminated, transfer to
such successor all relevant books, records, and data
established or maintained by Administrator under this
Agreement and shall cooperate in the transfer of such duties
and responsibilities, including provision, at the expense of
such Fund, for assistance from Administrator personnel in the
establishment of books, records, and other data by such
successor.

13. ASSIGNMENT. Any interest of Administrator under
this Agreement shall not be assigned either voluntarily or
involuntarily, by operation of law or otherwise, without the
prior written consent of Trust.

14. BOOKS AND RECORDS. Administrator shall maintain,
or oversee the maintenance by such other persons as may from
time to time be approved by the Board of Trustees to
maintain, the books, documents, records, and data required to
be kept by the Trust under the 1940 Act, the laws of the
Commonwealth of Massachusetts or such other authorities
having jurisdiction over the Trust or the Fund or as may
otherwise be required for the proper operation of the
business and affairs of the Trust or the Fund (other than
those required to be maintained by any investment adviser
retained by the Trust on behalf of a Fund in accordance with
Section 15 of the 1940 Act).

Administrator will periodically send to the Trust all
books, documents, records, and data of the Trust and each of
its Funds listed in Schedule A that are no longer needed for
current purposes or required to be retained as set forth
herein. Administrator shall have no liability for loss or
destruction of said books, documents, records, or data after
they are returned to such Trust.

Administrator agrees that all such books, documents,
records, and data which it maintains shall be maintained in
accordance with Rule 31a-3 of the 1940 Act and that any such
items maintained by it shall be the property of the Trust.
Administrator further agrees to surrender promptly to the
Trust any such items it maintains upon request, provided that
the Administrator shall be permitted to retain a copy of all
such items. Administrator agrees to preserve all such items
maintained under Rule 31a-1 for the period prescribed under
Rule 31a-2 of the 1940 Act.

Trust shall furnish or otherwise make available to
Administrator such copies of the financial statements, proxy
statements, reports, and other information relating to the
business and affairs of each Fund of the Trust as
Administrator may, at any time or from time to time,
reasonably require in order to discharge its obligations
under this Agreement.

15. NON-LIABILITY OF TRUSTEES AND SHAREHOLDERS. Any
obligation of Trust hereunder shall be binding only upon the
assets of Trust (or the applicable Fund thereof) and shall
not be binding upon any Trustee, officer, employee, agent or
shareholder of Trust. Neither the authorization of any
action by the Trustees or shareholders of Trust nor the
execution of this Agreement on behalf of Trust shall impose
any liability upon any Trustee or any shareholder.

16. USE OF ADMINISTRATOR'S NAME. The Trust may use its
name and the names of its Funds listed in Schedule A or any
other name derived from the name "Stein Roe & Farnham" only
for so long as this Agreement or any extension, renewal, or
amendment hereof remains in effect, including any similar
agreement with any organization which shall have succeeded to
the business of Administrator as it relates to the services
it has agreed to furnish under this Agreement. At such time
as this Agreement or any extension, renewal or amendment
hereof, or such other similar agreement shall no longer be in
effect, Trust will cease to use any name derived from the
name "Stein Roe & Farnham" or otherwise connected with
Administrator, or with any organization which shall have
succeeded to Administrator's business herein described.

17. REFERENCES AND HEADINGS. In this Agreement and in
any such amendment, references to this Agreement and all
expressions such as "herein," "hereof," and "hereunder" shall
be deemed to refer to this Agreement as amended or affected
by any such amendments. Headings are placed herein for
convenience of reference only and shall not be taken as a
part hereof or control or affect the meaning, construction or
effect of this Agreement. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an
original.

Dated: February 14, 1997

STEIN ROE ADVISOR TRUST

ATTEST: By: TIMOTHY K. ARMOUR
Timothy K. Armour
President
NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary
STEIN ROE & FARNHAM INCORPORATED.

ATTEST: By: HANS P. ZIEGLER
Hans P. Ziegler
Chief Executive Officer
NICOLETTE D. PARRISH
Nicolette D. Parrish,
Assistant Secretary

<PAGE>

STEIN ROE ADVISOR TRUST
ADMINISTRATIVE AGREEMENT
SCHEDULE A

The Funds of the Trust currently subject to this Agreement
are as follows:

Name of Series Effective Date
- -------------------------------------- -----------------
Stein Roe Advisor Growth & Income Fund February 14, 1997
Stein Roe Advisor Young Investor Fund February 14, 1997
Stein Roe Advisor Growth Stock Fund February 14, 1997
Stein Roe Advisor Intermediate Bond Fund February 2, 1998
Stein Roe Advisor High-Yield Municipals Fund February 2, 1998

Dated: June 28, 1999

STEIN ROE ADVISOR TRUST

By: THOMAS W. BUTCH
Thomas W. Butch
President
Attest:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

STEIN ROE & FARNHAM INCORPORATED

By: THOMAS W. BUTCH
Thomas W. Butch
President, Mutual Funds Division

Attest:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

<PAGE>

STEIN ROE ADVISOR TRUST
ADMINISTRATIVE AGREEMENT
SCHEDULE B

Compensation pursuant to Section 7 of this Agreement shall be
calculated with respect to each Fund in accordance with the
following schedule applicable to average daily net assets of
the Fund:

Fund Administrative Fee Schedule
- --------------------------- --------------------------------
Stein Roe Advisor Growth &
Income Fund 0.15% of the first $500 million,
Stein Roe Advisor Growth 0.125% of the next $500 million,
Stock Fund 0.10% thereafter
Stein Roe Advisor High-
Yield Municipals Fund

Stein Roe Advisor Inter- 0.150%
mediate Bond Fund

Stein Roe Advisor Young
Investor Fund 0.20% of the first $500 million,
0.15% of the next $500 million,
0.125% thereafter

Dated: June 28, 1999

STEIN ROE ADVISOR TRUST

By: THOMAS W. BUTCH
Thomas W. Butch
President
Attest:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

STEIN ROE & FARNHAM INCORPORATED

By: THOMAS W. BUTCH
Thomas W. Butch
President, Mutual Funds Division

Attest:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

STEIN ROE FUNDS
AMENDED AND RESTATED
ACCOUNTING AND BOOKKEEPING AGREEMENT

This Agreement is made this 3rd day of August, 1999 by and
between Liberty-Stein Roe Advisor Trust, a Massachusetts business
trust, (hereinafter referred to as the "Trust") and Stein Roe &
Farnham Incorporated ("Stein Roe"), a Delaware corporation.

1. Appointment. The Trust hereby appoints Stein Roe to act as
its agent to perform the services described herein with respect to
each series of shares of the Trust (the "Series") identified in
and beginning on the date specified on Appendix I to this
Agreement, as may be amended from time to time. Stein Roe hereby
accepts appointment as the Trust's agent and agrees to perform the
services described herein.

2. Accounting.

(a) Pricing. For each Series of the Trust, Stein Roe shall
value all securities and other assets of the Series, and
compute the net asset value per share of such Series, at
such times and dates and in the manner and by such
methodology as is specified in the then currently
effective prospectus and statement of additional
information for such Series, and pursuant to such other
written procedures or instructions furnished to Stein Roe
by the Trust. To the extent procedures or instructions
used to value securities or other assets of a Series under
this Agreement are at any time inconsistent with any
applicable law or regulation, the Trust shall provide
Stein Roe with written instructions for valuing such
securities or assets in a manner which the Trust
represents to be consistent with applicable law and
regulation.

(b) Net Income. Stein Roe shall calculate with such frequency
as the Trust shall direct, the net income of each Series
of the Trust for dividend purposes and on a per share
basis. Such calculation shall be at such times and dates
and in such manner as the Trust shall instruct Stein Roe
in writing. For purposes of such calculation, Stein Roe
shall not be responsible for determining whether any
dividend or interest accruable to the Trust is or will be
actually paid, but will accrue such dividend and interest
unless otherwise instructed by the Trust.

(c) Capital Gains and Losses. Stein Roe shall calculate gains
or losses of each Series of the Trust from the sale or
other disposition of assets of that Series as the Trust
shall direct.

(d) Yields. At the request of the Trust, Stein Roe shall
compute yields for each Series of the Trust for such
periods and using such formula as shall be instructed by
the Trust.

(e) Communication of Information. Stein Roe shall provide the
Trust, the Trust's transfer agent and such other parties
as directed by the Trust with the net asset value per
share, the net income per share and yields for each Series
of the Trust at such time and in such manner and format
and with such frequency as the parties mutually agree.

(f) Information Furnished by the Trust. The Trust shall
furnish Stein Roe with any and all instructions,
explanations, information, specifications and
documentation deemed necessary by Stein Roe in the
performance of its duties hereunder, including, without
limitation, the amounts and/or written formula for
calculating the amounts, and times of accrual of
liabilities and expenses of each Series of the Trust. The
Trust shall also at any time and from time to time furnish
Stein Roe with bid, offer and/or market values of
securities owned by the Trust if the same are not
available to Stein Roe from a pricing or similar service
designated by the Trust for use by Stein Roe to value
securities or other assets. Stein Roe shall at no time be
required to commence or maintain any utilization of, or
subscriptions to, any such service which shall be the sole
responsibility and expense of the Trust.

3. Recordkeeping.

(a) Stein Roe shall, as agent for the Trust, maintain and keep
current and preserve the general ledger and other
accounts, books, and financial records of the Trust
relating to activities and obligations under this
Agreement in accordance with the applicable provisions of
Section 31(a) of the General Rules and Regulations under
the Investment Company Act of 1940, as amended (the
"Rules").

(b) All records maintained and preserved by Stein Roe pursuant
to this Agreement which the Trust is required to maintain
and preserve in accordance with the Rules shall be and
remain the property of the Trust and shall be surrendered
to the Trust promptly upon request in the form in which
such records have been maintained and preserved.

(c) Stein Roe shall make available on its premises during
regular business hours all records of a Trust for
reasonable audit, use and inspection by the Trust, its
agents and any regulatory agency having authority over the
Trusts.

4. Instructions, Opinion of Counsel, and Signatures.

(a) At any time Stein Roe may apply to a duly authorized agent
of the Trust for instructions regarding the Trust, and may
consult counsel for such Trust or its own counsel, in
respect of any matter arising in connection with this
Agreement, and it shall not be liable for any action taken
or omitted by it in good faith in accordance with such
instructions or with the advice or opinion of such
counsel. Stein Roe shall be protected in acting upon any
such instruction, advice, or opinion and upon any other
paper or document delivered by the Trust or such counsel
believed by Stein Roe to be genuine and to have been
signed by the proper person or persons and shall not be
held to have notice of any change of authority of any
officer or agent of the Trust, until receipt of written
notice thereof from such Trust.

(b) Stein Roe may receive and accept a certified copy of a
vote of the Board of Trustees of the Trust as conclusive
evidence of (i) the authority of any person to act in
accordance with such vote or (ii) any determination or any
action by the Board of Trustees pursuant to its Agreement
and Declaration of Trust as described in such vote, and
such vote may be considered as in full force and effect
until receipt by Stein Roe of written notice to the
contrary.

5. Compensation. The Trust shall reimburse Stein Roe from the
assets of the respective applicable Series of the Trust, for any
and all out-of-pocket expenses and charges in performing services
under this Agreement and such compensation as is provided in
Appendix II to this Agreement, as amended from time to time.
Stein Roe shall invoice the Trust as soon as practicable after the
end of each calendar month, with allocation among the respective
Series and full detail, and the Trust shall promptly pay Stein Roe
the invoiced amount.

6. Confidentiality of Records. Stein Roe agrees not to disclose
any information received from the Trust to any other client of
Stein Roe or to any other person except its employees and agents,
and shall use its best efforts to maintain such information as
confidential. Upon termination of this Agreement, Stein Roe shall
return to the Trust all records in the possession and control of
Stein Roe related to such Trust's activities, other than Stein
Roe's own business records, it being also understood and agreed
that any programs and systems used by Stein Roe to provide the
services rendered hereunder will not be given to any Trust.

7. Liability and Indemnification.

(a) Stein Roe shall not be liable to any Trust for any action
taken or thing done by it or its employees or agents on
behalf of the Trust in carrying out the terms and
provisions of this Agreement if done in good faith and
without negligence or misconduct on the part of Stein Roe,
its employees or agents.

(b) The Trust shall indemnify and hold Stein Roe, and its
controlling persons, if any, harmless from any and all
claims, actions, suits, losses, costs, damages, and
expenses, including reasonable expenses for counsel,
incurred by it in connection with its acceptance of this
Agreement, in connection with any action or omission by it
or its employees or agents in the performance of its
duties hereunder to the Trust, or as a result of acting
upon instructions believed by it to have been executed by
a duly authorized agent of the Trust or as a result of
acting upon information provided by the Trust in form and
under policies agreed to by Stein Roe and the Trust,
provided that: (i) to the extent such claims, actions,
suits, losses, costs, damages, or expenses relate solely
to one or more Series, such indemnification shall be only
out of the assets of that Series or group of Series; (ii)
this indemnification shall not apply to actions or
omissions constituting negligence or misconduct on the
part of Stein Roe or its employees or agents, including
but not limited to willful misfeasance, bad faith, or
gross negligence in the performance of their duties, or
reckless disregard of their obligations and duties under
this Agreement; and (iii) Stein Roe shall give the Trust
prompt notice and reasonable opportunity to defend against
any such claim or action in its own name or in the name of
Stein Roe.

(c) Stein Roe shall indemnify and hold harmless the Trust from
and against any and all claims, demands, expenses and
liabilities which such Trust may sustain or incur arising
out of, or incurred because of, the negligence or
misconduct of Stein Roe or its agents or contractors, or
the breach by Stein Roe of its obligations under this
Agreement, provided that: (i) this indemnification shall
not apply to actions or omissions constituting negligence
or misconduct on the part of such Trust or its other
agents or contractors and (ii) such Trust shall give Stein
Roe prompt notice and reasonable opportunity to defend
against any such claim or action in its own name or in the
name of such Trust.

8. Further Assurances. Each party agrees to perform such further
acts and execute such further documents as are necessary to
effectuate the purposes hereof.

9. Dual Interests. It is understood and agreed that some person
or persons may be trustees, officers, or shareholders of both the
Trusts and Stein Roe, and that the existence of any such dual
interest shall not affect the validity hereof or of any
transactions hereunder except as otherwise provided by specific
provision of applicable law.

10. Amendment and Termination. This Agreement may be modified or
amended from time to time, or terminated, by mutual agreement
between the parties hereto and may be terminated by at least one
hundred eighty (180) days' written notice given by one party to
the other. Upon termination hereof, the Trust shall pay to Stein
Roe such compensation as may be due from it as of the date of such
termination, and shall reimburse Stein Roe for its costs,
expenses, and disbursements payable under this Agreement to such
date. In the event that, in connection with termination, a
successor to any of the duties or responsibilities of Stein Roe
hereunder is designated by a Trust by written notice to Stein Roe,
Stein Roe shall promptly upon such termination and at the expense
of such Trust, deliver to such successor all relevant books,
records, and data established or maintained by Stein Roe under
this Agreement and shall cooperate in the transfer of such duties
and responsibilities, including provision, at the expense of such
Trust, for assistance from Stein Roe personnel in the
establishment of books, records, and other data by such successor.

11. Assignment. Any interest of Stein Roe under this Agreement
shall not be assigned or transferred either voluntarily or
involuntarily, by operation of law or otherwise, without prior
written notice to the Trust.

12. Use of Affiliated Companies and Subcontractors. In connection
with the services to be provided by Stein Roe under this
Agreement, Stein Roe may, to the extent it deems appropriate, and
subject to compliance with the requirements of applicable laws and
regulations and upon receipt of approval of the Trustees, make use
of (i) its affiliated companies and their directors, trustees,
officers, and employees and (ii) subcontractors selected by Stein
Roe, provided that Stein Roe shall supervise and remain fully
responsible for the services of all such third parties in
accordance with and to the extent provided by this Agreement. All
costs and expenses associated with services provided by any such
third parties shall be borne by Stein Roe or such parties.

13. Notice. Any notice under this Agreement shall be in writing,
addressed and delivered or sent by registered mail, postage
prepaid to the other party at such address as such other party may
designate for the receipt of such notices. Until further notice
to the other parties, it is agreed that the address of the Trust
and Stein Roe is One South Wacker Drive, Chicago, Illinois 60606,
Attention: Secretary.

14. Non-Liability of Trustees and Shareholders. Any obligation of
the Trust hereunder shall be binding only upon the assets of that
Trust (or the applicable Series thereof), as provided in the
Agreement and Declaration of Trust of that Trust, and shall not be
binding upon any Trustee, officer, employee, agent or shareholder
of the Trust or upon any other Trust. Neither the authorization
of any action by the Trustees or the shareholders of the Trust,
nor the execution of this Agreement on behalf of the Trust shall
impose any liability upon any Trustee or any shareholder. Nothing
in this Agreement shall protect any Trustee against any liability
to which such Trustee would otherwise be subject by willful
misfeasance, bad faith or gross negligence in the performance of
his duties, or reckless disregard of his obligations and duties
under this Agreement. In connection with the discharge and
satisfaction of any claim made by Stein Roe against the Trust
involving more than one Series, the Trust shall have the exclusive
right to determine the appropriate allocations of liability for
any such claim between or among the Series.

15. References and Headings. In this Agreement and in any such
amendment, references to this Agreement and all expressions such
as "herein," "hereof," and "hereunder," shall be deemed to refer
to this Agreement as amended or affected by any such amendments.
Headings are placed herein for convenience of reference only and
shall not be taken as part hereof or control or affect the
meaning, construction or effect of this Agreement. This Agreement
may be executed in any number of counterparts, each of which shall
be deemed an original.

16. Governing Law. This Agreement shall be governed by the laws
of the State of Illinois.

IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed as of the day and year first above written.

LIBERTY-STEIN ROE ADVISOR TRUST

By: THOMAS W. BUTCH
Thomas W. Butch
President
Attest:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

STEIN ROE & FARNHAM INCORPORATED

By: THOMAS W. BUTCH
Thomas W. Butch
President, Mutual Funds Division

Attest:

NICOLETTE D. PARRISH
Nicolette D. Parrish
Assistant Secretary

<PAGE>

LIBERTY-STEIN ROE ADVISOR TRUST
ACCOUNTING & BOOKKEEPING AGREEMENT
APPENDIX I

The series of the Trust currently subject to this Agreement are as
follows:

Series Effective Date
Stein Roe Advisor Growth & Income Fund August 3, 1999
Stein Roe Advisor Young Investor Fund August 3, 1999
Stein Roe Advisor Growth Stock Fund August 3, 1999
Stein Roe Advisor Intermediate Bond Fund August 3, 1999
Stein Roe Advisor High-Yield Municipals Fund August 3, 1999

Dated: August 3, 1999

<PAGE>

LIBERTY-STEIN ROE ADVISOR TRUST
ACCOUNTING & BOOKKEEPING AGREEMENT
APPENDIX II

For the services provided under the Accounting & Bookkeeping
Agreement (the "Agreement"), the Trust shall pay Stein Roe an
annual fee with respect to each series, calculated and paid
monthly, equal to $25,000 plus .0025 percent per annum of the
average daily net assets of the series in excess of $50 million.
Such fee shall be paid within thirty days after receipt of monthly
invoice.