Independent Auditors' Report
To the Board of Directors of
UMB Scout Kansas Tax-Exempt Bond Fund, Inc.
and
the Securities and Exchange Commission:
RE: UMB Scout Kansas Tax-Exempt Bond Fund, Inc.
Form N-17f-2
File Number 811-08513
We have examined management's assertion about UMB SCOUT KANSAS TAX-EXEMPT
BOND FUND, INC.'s (the "Company's") compliance with certain rules under
the Investment Company Act of 1940 (the "Act") as of December 31, 1998,
and for the period June 30, 1998 through December 31, 1998, included
in the accompanying Management Statement Regarding Compliance with
Certain Provisions of the Investment Company Act of 1940. Management
is responsible for the Company's compliance with those requirements.
Our responsibility is to express an opinion on management's assertion
about the Company's compliance based on our examination.
Our examination was made in accordance with standards established by
the American Institute of Certified Public Accountants and,
accordingly, included examining, on a test basis, evidence about the
Company's compliance with those requirements and performing such other
procedures as we considered necessary in the circumstances. Included
among our procedures were the following tests performed as of December 31,
1998, and for the period June 30, 1998 through December 31, 1998, with
respect to securities of UMB SCOUT KANSAS TAX-EXEMPT BOND FUND, INC.,
without prior notice to management:
* Securities owned as of the close of business on December 31, 1998, shown
by the books and records were verified with the custodian, UMB Bank,
n.a., which verification includes confirmation of securities with the
Federal Reserve Bank, which uses the book entry method of accounting
for securities;
* Securities purchased/sold but not received/delivered, hypothecated,
pledged, placed in escrow, or out for transfer with brokers, pledgees
and/or transfer agents were verified to supporting data where the
securities were in-transit resulting from purchase or sale
transactions;
* Reconciliation of all such securities to the books and records of the
Company and the Custodian.
We believe that our examination provides a reasonable basis for our
opinion. Our examination does not provide a legal determination on the
Company's compliance with specified requirements.
In our opinion, management's assertion that UMB Scout Kansas Tax-Exempt
Bond Fund, Inc. was in compliance with certain provisions of Rule 17f-2
of the Investment Company Act of 1940 as of December 31, 1998, is fairly
stated, in all material respects.
This report is intended solely for the information and use of
management of UMB Scout Kansas Tax-Exempt Bond Fund, 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/ BAIRD, KURTZ & DOBSON
Kansas City, Missouri
February 19, 1999
Washington, D.C. 20549
FORM N-17f-2
Certificate of Accounting of Securities and Similar Investments
in the Custody of Management Investment Companies
Pursuant to Rule 17f-2 [17 CFR 270.17f-2]
1. Investment Company Act File Number: Date examination completed:
811-08513 December 31, 1998
2. State Identification Number:
AL
AK
AZ
AR
CA
CO
CT
DE
DC
FL
GA
HI
ID
IL
IN
IA
KS 98S0000990
KY
LA
ME
MD
MA
MI
MN
MS
MO 1998-00198
MT
NE
NV
NH
NJ
NM
NY
NC
ND
OH
OK
OR
PA
RI
SC
SD
TN
TX
UT
VT
VA
WA
WV
WI
WY
PUERTO RICO
Other (specify):
*Indicates Fund is registered in state but state does not issue
identification numbers
3. Exact name of investment company as specified in registration statement:
UMB Scout Kansas Tax-Exempt Bond Fund, Inc.
4. Address of principal executive office: (number, street, city, state,
zip code)
700 Karnes Blvd, BMA Tower, Kansas City, Missouri 64108
INSTRUCTIONS
This Form must be completed by the investment companies that have
custody of securities or similar investments.
Investment Company
1. All items must be completed by the investment company.
2. Give this Form to the independent public accountant who, in
compliance with Rule 17f-2 under the Act and applicable state law,
examines securities and similar investments in the custody of the
investment company.
Accountant
3. Submit this Form to the Securities and Exchange Commission and
appropriate state securities administrators when filing the certificate
of accounting required by Rule 17f-2 under the Act and applicable state
law. File the original and one copy with the Securities and Exchange
Commission's principal office in Washington, D.C., one copy with the
regional office for the region in which the investment company's
principal business operations are conducted, and one copy with the
appropriate state administrator(s), if applicable.
THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT
Note: The estimated average burden hours are made solely for purposes
of the Paperwork Reduction Act, and are not derived from a
comprehensive or even a representative survey or study of the costs of
SEC rules and forms. Direct any comments concerning the accuracy of
the estimated average burden hours for compliance with SEC rules and
forms to Kenneth A. Fogash, Deputy Executive Director, U.S. Securities
and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C.
20549 and Gary Waxman, Clearance Officer, Office of Management and
Budget, Room 3208 New Executive Office Building, Washington, D.C.
20503.
<PAGE>
Management Statement Regarding Compliance with
Certain Provisions of the Investment Company Act of 1940
Management believes that UMB Scout Kansas Tax-Exempt Bond Fund, Inc. was in
compliance with the provisions of Rule 17f-2 of the Investment Company
Act of 1940 as of December 31, 1998, and during the period June 30, 1998
(prior date of Management's Statement Regarding Compliance with Certain
Provisions of the Investment Company Act of 1940) through December 31, 1998,
with respect to securities reflected in the investment account of UMB Scout
Kansas Tax-Exempt Bond Fund, Inc.
UMB SCOUT KANSAS TAX-EXEMPT BOND FUND, INC.
By /s/Laurence J. Schmidt
Laurence J. Schmidt, Senior Vice President
