<PAGE> PAGE 1
000 B000000 12/31/1998
000 C000000 0000275039
000 D000000 N
000 E000000 NF
000 F000000 Y
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000 I000000 6.1
000 J000000 A
001 A000000 TRIFLEX FUND, INC.
001 B000000 811-2818
001 C000000 2813342469
002 A000000 P.O. BOX 58969
002 B000000 HOUSTON
002 C000000 TX
002 D010000 77258
002 D020000 8969
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008 A000001 SECURITIES MANAGEMENT AND RESEARCH, INC.
008 B000001 A
008 C000001 801-8002
008 D010001 HOUSTON
008 D020001 TX
008 D030001 77258
008 D040001 8969
010 A000001 SECURITIES MANAGEMENT AND RESEARCH, INC.
010 C010001 HOUSTON
010 C020001 TX
010 C030001 77258
010 C040001 8969
011 A000001 SECURITIES MANAGEMENT AND RESEARCH, INC.
011 B000001 8-12745
011 C010001 HOUSTON
011 C020001 TX
011 C030001 77258
011 C040001 8969
<PAGE> PAGE 2
012 A000001 SECURITIES MANAGEMENT AND RESEARCH, INC.
012 B000001 84-00749
012 C010001 HOUSTON
012 C020001 TX
012 C030001 77258
012 C040001 8969
013 A000001 TAIT, WELLER & BAKER
013 B010001 PHILADELPHIA
013 B020001 PA
013 B030001 19103
013 B040001 2108
015 A000001 MOODY NATIONAL BANK
015 B000001 S
015 C010001 GALVESTON
015 C020001 TX
015 C030001 77550
015 E030001 X
018 000000 Y
019 A000000 Y
019 B000000 10
019 C000000 AMER NAT'L
020 A000001 FIRST BOSTON (THE)
020 B000001 13-5659485
020 C000001 4
020 A000002 OPPENHEIMER & CO., INC.
020 B000002 13-2798343
020 C000002 4
020 A000003 MERRILL LYNCH, PIERCE, FENNER & SMITH, INC.
020 B000003 13-5674085
020 C000003 3
020 A000004 DONALDSON, LUFKIN & JENRETTE, INC.
020 B000004 13-2741729
020 C000004 2
020 A000005 COWEN & COMPANY, INC.
020 B000005 13-5616116
020 C000005 1
020 A000006 PAINEWEBBER, INC.
020 B000006 13-2638166
020 C000006 1
020 A000007 BERNSTEIN (SANFORD C.) & CO., INC.
020 B000007 13-2625874
020 C000007 1
020 A000008 LEHMAN BROTHERS, INC.
020 B000008 13-2618466
020 C000008 0
020 A000009 PRUDENTIAL SECURITIES, INC.
020 B000009 22-2347336
020 C000009 0
020 A000010 JEFFERIES & COMPANY, INC.
020 B000010 95-2622900
020 C000010 0
<PAGE> PAGE 3
021 000000 16
022 A000001 MERRILL LYNCH, PIERCE, FENNER & SMITH, INC.
022 B000001 13-5674085
022 C000001 16932
022 D000001 17401
022 A000002 GOLDMAN, SACHS, & CO.
022 B000002 13-5108880
022 C000002 15585
022 D000002 15479
022 A000003 LEHMAN BROTHERS, INC.
022 B000003 13-2618466
022 C000003 9022
022 D000003 8745
022 A000004 FIRST BOSTON (THE)
022 B000004 13-5659485
022 C000004 7892
022 D000004 7909
022 A000005 FIRST CHICAGO CAPITAL MARKETS, INC.
022 B000005 36-3595942
022 C000005 5819
022 D000005 5925
022 A000006 BANK OF AMERICA NT & SA
022 B000006 94-1687665
022 C000006 1888
022 D000006 1890
022 A000007 OPPENHEIMER & CO., INC.
022 B000007 13-2798343
022 C000007 1214
022 D000007 674
022 A000008 PRUDENTIAL SECURITIES, INC.
022 B000008 22-2347336
022 C000008 1166
022 D000008 94
022 A000009 DONALDSON, LUFKIN & JENRETTE, INC.
022 B000009 13-2741729
022 C000009 316
022 D000009 744
022 A000010 PAINEWEBBER, INC.
022 B000010 13-2638166
022 C000010 271
022 D000010 301
023 C000000 61057
023 D000000 60410
024 000000 N
025 D000001 0
025 D000002 0
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<PAGE> PAGE 4
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<PAGE> PAGE 5
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<PAGE> PAGE 6
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<PAGE> PAGE 7
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<PAGE> PAGE 8
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<PAGE> PAGE 9
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SIGNATURE BRENDA KOELEMAY
TITLE VP/TREASURER
[ARTICLE] 6
[CIK] 0000275039
[NAME] TRIFLEX FUND, INC.
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-END] DEC-31-1998
[INVESTMENTS-AT-COST] 22299394
[INVESTMENTS-AT-VALUE] 29112344
[RECEIVABLES] 248636
[ASSETS-OTHER] 22238
[OTHER-ITEMS-ASSETS] 60061
[TOTAL-ASSETS] 29443279
[PAYABLE-FOR-SECURITIES] 0
[SENIOR-LONG-TERM-DEBT] 0
[OTHER-ITEMS-LIABILITIES] 76175
[TOTAL-LIABILITIES] 76175
[SENIOR-EQUITY] 0
[PAID-IN-CAPITAL-COMMON] 21046344
[SHARES-COMMON-STOCK] 1496411
[SHARES-COMMON-PRIOR] 1410260
[ACCUMULATED-NII-CURRENT] 0
[OVERDISTRIBUTION-NII] 0
[ACCUMULATED-NET-GAINS] 11399
[OVERDISTRIBUTION-GAINS] 0
[ACCUM-APPREC-OR-DEPREC] 6812950
[NET-ASSETS] 29367104
[DIVIDEND-INCOME] 259664
[INTEREST-INCOME] 756839
[OTHER-INCOME] 0
[EXPENSES-NET] 334182
[NET-INVESTMENT-INCOME] 682321
[REALIZED-GAINS-CURRENT] 482000
[APPREC-INCREASE-CURRENT] 2417733
[NET-CHANGE-FROM-OPS] 3582054
[EQUALIZATION] 0
[DISTRIBUTIONS-OF-INCOME] 663775
[DISTRIBUTIONS-OF-GAINS] 908074
[DISTRIBUTIONS-OTHER] 0
[NUMBER-OF-SHARES-SOLD] 204284
[NUMBER-OF-SHARES-REDEEMED] 202186
[SHARES-REINVESTED] 84053
[NET-CHANGE-IN-ASSETS] 1518827
[ACCUMULATED-NII-PRIOR] 0
[ACCUMULATED-GAINS-PRIOR] 418927
[OVERDISTRIB-NII-PRIOR] 0
[OVERDIST-NET-GAINS-PRIOR] 0
[GROSS-ADVISORY-FEES] 198438
[INTEREST-EXPENSE] 0
[GROSS-EXPENSE] 367636
[AVERAGE-NET-ASSETS] 26743048
[PER-SHARE-NAV-BEGIN] 18.32
[PER-SHARE-NII] 0.48
[PER-SHARE-GAIN-APPREC] 1.96
[PER-SHARE-DIVIDEND] 0.47
[PER-SHARE-DISTRIBUTIONS] 0.66
[RETURNS-OF-CAPITAL] 0.00
[PER-SHARE-NAV-END] 19.63
[EXPENSE-RATIO] 1.25
[AVG-DEBT-OUTSTANDING] 0
[AVG-DEBT-PER-SHARE] 0
Expenses for the calculation are net of a reimbursement from Securities
Management and Research, Inc. Without this reimbursement, the ratio of
expenses to average net assets would have been 1.37%.
</TABLE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
ON INTERNAL CONTROL STRUCTURE
The Board of Directors
SM&R Equity Funds
(Formerly American National Funds Group)
Galveston, Texas
In planning and performing our audits of the financial statements of SM&R
Growth Fund, Inc. (formerly American National Growth Fund, Inc.), SM&R Equity
Income Fund, Inc. (formerly American National Income Fund, Inc.), and SM&R
Balanced Fund, Inc. (formerly Triflex Fund, Inc.) for the year ended
December 31, 1998, we considered their internal control structure, including
procedures 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 the internal control structure.
The management of the Funds is responsible for establishing and maintaining
an internal control structure. In fulfilling this responsibility, estimates
and judgments by management are required to assess the expected benefits and
related costs of internal control structure policies and procedures. Two of
the objectives of an internal control structure are to provide management with
reasonable, but not absolute, assurance that assets are safeguarded against
loss from unauthorized use or disposition, and that transactions are executed in
accordance with management's authorization and recorded properly to permit
preparation of financial statements in conformity with generally accepted
accounting principles.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projection of any
evaluation of the structure 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 the internal control structure would not necessarily
disclose all matters in the internal control structure 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 the specific internal control structure elements 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 structure, including procedures for
safeguarding securities, that we consider to be material weaknesses, as defined
above, as of December 31, 1998.
This report is intended solely for the information and use of management and
the Securities and Exchange Commission, and should not be used for any other
purpose.
Tait Weller and Baker
Philadelphia, Pennsylvania
January 29, 1999
