Shareholders and Board of Directors
MuniHoldings Fund II, Inc.
In planning and performing our audit of the financial statements of
MuniHoldings Fund II, Inc. for the year ended July 31, 2000,
we considered its internal control, including control activities
for 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 internal control.
The management of MuniHoldings Fund II, Inc. 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 accounting
principles generally accepted in the United States. Those controls
include the safeguarding of assets against unauthorized acquisition,
use, or disposition.
Because of inherent limitations in internal control, error or fraud
may occur and 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 one or more of the
specific internal control components does not reduce to a relatively
low level the risk that misstatements caused by error or fraud 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
internal control and its operation, including controls for
safeguarding securities, that we consider to be material weaknesses
as defined above as of July 31, 2000.
This report is intended solely for the information and use of the
Board of Directors and management of MuniHoldings Fund II, Inc., and
the Securities and Exchange Commission and is not intended to be and
should not be used by anyone other than these specified parties.
/s/Ernst & Young LLP
MetroPark, New Jersey
August 28, 2000
