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SIGNATURE ALEX M. CICCONE
TITLE ASSISTANT SECRETARY
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<NAME> USAA MUTUAL FUND, INC.
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<NAME> USAA S&P 500 INDEX FUND
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COOPERS & LYBRAND
a professional services firm
Report of Independent Accountants
To the Board of Directors of USAA Mutual Fund, Inc.
and the Shareholders of the USAA S&P 500 Index Fund:
In planning and performing our audit of the financial statements and financial
highlights of the USAA S&P 500 Index Fund for the year ended December 31, 1997,
we considered its internal control, including controls over safeguarding
securities, in order to determine our auditing procedures for the purpose of
expressing our opinion on the financial statements and to comply with the
requirements of Form N-SAR, not to provide assurance on the internal control.
The management of the USAA S&P 500 Index Fund is responsible for establishing
and maintaining internal control. In fulfilling this responsibility, estimates
and judgments by management are required to assess the expected benefits and
related costs of controls. Generally, controls that are relevant to an audit
pertain to the entity's objective of preparing financial statements for external
purposes that are fairly presented in conformity with generally accepted
accounting principles. Those controls include the safeguarding of assets against
unauthorized acquisition, use, or disposition.
Because of inherent limitations in internal control, errors or irregularities
may occur and may not be detected. Also, projection of any evaluation of
internal control to future periods is subject to the risk that it may become
inadequate because of changes in conditions or that the effectiveness of the
design and operation may deteriorate.
Our consideration of internal control would not necessarily disclose all matters
in internal control that might be material weaknesses under standards
established by the American Institute of Certified Public Accountants. A
material weakness is a condition in which the design or operation of any
specific internal control component does not reduce to a relatively low level
the risk that errors or irregularities in amounts that would be material in
relation to the financial statements being audited may occur and not be detected
within a timely period by employees in the normal course of performing their
assigned functions. However, we noted no matters involving the internal control,
including controls over safeguarding securities, that we consider to be material
weaknesses as defined above as of December 31, 1997.
This report is intended solely for the information and use of management and the
Securities and Exchange Commission.
Coopers & Lybrand, L.L.P.
Kansas City, Missouri
February 13, 1998
