COLONIAL UTILITIES FUND
Supplement to the March 30, 1998 Prospectus Revised July 13, 1998
(Replacing Supplement dated October 30, 1998)
The Fund's Prospectus is amended as follows:
(1) Effective immediately, John E. Lennon no longer co-manages the Fund.
(2) To the front cover of the Prospectus, a new paragraph is added below the
Table of Contents as follows:
This Prospectus is also available on-line at the Web site
http://www.libertyfunds.com. The SEC maintains a Web site
(http://www.sec.gov) that contains the Statement of Additional Information,
materials that are incorporated by reference into this Prospectus and the
Statement of Additional Information, and other information regarding the
Fund.
(3) The sub-caption "Borrowing of Money" under the caption HOW THE FUND PURSUES
ITS OBJECTIVE AND CERTAIN RISK FACTORS is revised in its entirety as follows:
Borrowing of Money. The Fund may borrow money from banks, other affiliated
funds and other entities to the extent permitted by law for temporary or
emergency purposes up to 33 1/3% of its total assets.
(4) A new caption and paragraph is added after the last paragraph of the caption
HOW THE FUND IS MANAGED as follows:
YEAR 2000
The Fund's Advisor, Distributor and Transfer Agent (Liberty Companies) are
actively managing Year 2000 readiness for the Fund. The Liberty Companies
are taking steps that they believe are reasonably designed to address the
Year 2000 problem and are communicating with vendors who provide services,
software and systems to the Fund to provide that date-related information
and data can be properly processed and calculated on and after January 1,
2000. Many Fund service providers and vendors, including the Liberty
Companies, 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 January 1, 2000. However, no assurances can be
given that all modifications required to ensure proper data processing and
calculation on and after January 1, 2000 will be timely made or that
services to the Fund will not be adversely affected.
(5) A new sentence is added as the last sentence under the caption HOW THE FUND
VALUES ITS SHARES as follows:
In addition, if the values of foreign securities have been materially
affected by events occurring after the closing of a foreign market, the
foreign securities may be valued at their fair value.
(6) The following is added to the paragraph "Class A Shares" under the caption
HOW TO EXCHANGE SHARES:
Exchanges of Class A shares are not subject to a contingent deferred sales
charge. However, in determining whether a contingent deferred sales charge
is applicable to redemptions, the schedule of the fund in which the
original investment was made should be used.
(7) Under the caption TELEPHONE TRANSACTIONS the first sentence is revised in
its entirety and new second and third sentences are added as follows:
All shareholders and/or their financial advisors are automatically eligible
to exchange Fund shares and to redeem up to $100,000 of Fund shares by
calling 1-800-422-3737 toll-free any business day between 9:00 a.m.
(Eastern time) and the time at which the Fund values its shares. Telephone
redemptions are limited to a total of $100,000 in a 30-day period.
Redemptions that exceed $100,000 may be accomplished by placing a wire
order trade through a broker or furnishing a signature guaranteed request.
(8) Liberty Financial Investments, Inc., the Fund's distributor, changed its
name to Liberty Funds Distributor, Inc. (Distributor). The new name will not
affect the services the Distributor provides to the Fund. The Distributor
continues to offer selected investment products managed by subsidiaries of its
indirect parent company, Liberty Financial Companies, Inc. (NYSE:L), the
indirect parent of the Distributor.
(9) Colonial Investors Service Center, Inc. (Transfer Agent) the Fund's transfer
agent, changed its name to Liberty Funds Services, Inc. The new name will not
affect the services the Transfer Agent provides to the Fund.
(10) Price Waterhouse LLP, the Fund's independent accountants, changed its name
to PricewaterhouseCoopers LLP. The new name will not affect the services the
independent accountants provide to the Fund.
UF-36/482G-0199 (1/99) January 4, 1999
