IAA TRUST MONEY MARKET FUND INC, 485APOS, 1996-08-14

IAA TRUST MONEY MARKET FUND INC
485APOS, 1996-08-14

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Filed with the Securities and Exchange Commission File No. 2-73768
on August 14, 1996. File No. 811-3186

================================================================================

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Post-Effective Amendment No. 19

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
Amendment No. 20

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
(Exact Name of Registrant as Specified in Charter)

808 IAA Drive
Bloomington, Illinois 61702 (309) 557-3092
(Address of Principal Executive Offices) (Registrant's Telephone Number)

IAA TRUST COMPANY
808 IAA Drive
Bloomington, Illinois 61702
(Name and Address of Agent for Service)

It is proposed that this filing will become effective (check appropriate box):

immediately upon filing pursuant to Paragraph (b);

on (date) pursuant to Paragraph (b);
-------------------

60 days after filing pursuant to Paragraph (a)(1);

X on October 28, 1996 (date) pursuant to Paragraph (a)(1);
-------------------
75 days after filing pursuant to Paragraph (a)(2); or

on (date) pursuant to Paragraph (a)(2) of Rule 485.
-------------------
If appropriate, check the following box:

this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

Registrant has registered an indefinite number of securities under the
Securities Act of 1933 pursuant to Rule 24f-2 under the Investment Act of 1940.
The Rule 24f-2 Notice for Registrant's most recent fiscal year will be filed on
or before August 28, 1996.

================================================================================

<PAGE>

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

CROSS REFERRENCE SHEET
INFORMATION REQUIRED IN THE PROSPECTUS

Part A Prospectus Headings
------ -------------------

<S> <C> <C>
Item 1. Cover Page Not Titled

Item 2. Synopsis Synopsis; Operating Expenses Table

Item 3. Condensed Financial Information Financial Highlights

Item 4. General Description Investment Objectives and
of Registrant Policies; Investment Strategies and Risk
Considerations

Item 5. Management of the Funds Management of the Funds

Item 6. Capital Stock and Capital Stock; Income Dividends,
Other Securities Capital Gains Distributions, and Taxes

Item 7. Purchase of Securities Purchase of Shares; Special Plans and
Being Offered Other Purchase Information; Valuation of Shares

Item 8. Redemption or Repurchase Redemption of Shares

Item 9. Pending Legal Proceedings *

</TABLE>

* The answer to the item is negative or the item is not applicable to
this filing, the registrant, or the securities being registered.

<PAGE>

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

CROSS REFERENCE SHEET
INFORMATION REQUIRED IN STATEMENT
ADDITIONAL INFORMATION

Part B Statement of Additional Information Headings
------ --------------------------------------------
<S> <C> <C>
Item 10. Cover Page Not Titled

Item 11. Table of Contents Table of Contents

Item 12. General Information Investment Objectives and Policies;
and History Policies and Investment Restrictions
Aimed at Protecting Investors

Item 13. Investment Objectives Investment Objectives and Policies;
and Policies Policies and Investment Restrictions
Aimed at Protecting Investors

Item 14. Management of the
Registrant Directors and Officers of the Funds

Item 15. Control Persons and
Principal Holders Control Persons and Principal Holders
of Securities of Securities

Item 16. Investment Advisory
and Other Services Investment Advisory and Other Services

Item 17. Brokerage Allocation
and Other Practices Brokerage

Item 18. Capital Stock
and Other Securities Brokerage

Item 19. Purchase, Redemption and Purchases, Redemptions, and
Pricing of Securities Pricing of Fund Securities;
Being Offered Underwriter Compensation

Item 20. Tax Status Purchases, Redemptions, and
Pricing of Fund Securities

Item 21. Underwriters Underwriter Compensation

Item 22. Calculations of
Performance Data Investment Performance Information

Item 23. Financial Statements Annual Report to Shareholders --
Letter to Shareholders; Portfolio Highlights;
Schedule of Investments; Statements of Assets and
Liabilities; Statements of Operations; Statements
of Changes in Net Assets; Notes to Financial
Statements; Report of Independent Accountants
</TABLE>

Part C - Other Information

Information required to be included in Part C is set forth under the appropriate
Item, so numbered, in Part C to this Registration Statement.

THE IAA TRUST MUTUAL FUNDS

IAA Trust Growth Fund, Inc.
IAA Trust Asset Allocation Fund, Inc.
IAA Trust Tax Exempt Bond Fund, Inc.

IAA Trust Taxable Fixed Income Series Fund, Inc.

PROSPECTUS

OCTOBER 28, 1996

808 IAA Drive Bloomington, Illinois 61702
(309) 557-3222

The IAA Trust Mutual Funds represent four separate funds, with one Fund
containing three separate Series (referred to herein as "Funds" or "Series").
Each of the Funds has distinct investment objectives and policies. Information
concerning the Funds has been combined into this one Prospectus to aid investors
in understanding the similarities and differences among the Funds. The four
Funds are as follows:

IAA Trust Growth Fund, Inc. is a mutual fund with an investment objective of
capital growth. The Fund seeks to achieve its investment objective by investing
principally in common stocks or securities with equity characteristics.

IAA Trust Asset Allocation Fund, Inc. seeks growth of capital and current income
as near-equal objectives. The Fund seeks to achieve this objective by investing
in a mix of assets consisting of common stocks (both dividend and non-dividend
paying), preferred and convertible preferred stocks, fixed income securities
including bonds, bonds convertible into common stocks and short-term interest
bearing obligations.

IAA Trust Tax Exempt Bond Fund, Inc. is a mutual fund with an investment
objective of seeking as high a level of current interest income exempt from
Federal income taxes as is available from municipal bonds, consistent with the
conservation of capital. The Fund seeks to achieve its investment objective by
investing substantially all of its assets in a diversified portfolio of
municipal bonds, the interest from which is exempt from Federal income tax in
the opinion of bond counsel to the issuers.

IAA Trust Taxable Fixed Income Series Fund, Inc. currently consists of three
separate investment series (each a "Series") designed to offer investors a
variety of fixed income investment opportunities.

IAA Trust Money Market Series is a mutual fund whose objective is to earn
as high a level of current income as possible, consistent with maintaining
liquidity and stability of principal. The Fund seeks to achieve its investment
objective by investing in high-quality money market instruments maturing in one
year or less, including securities issued or guaranteed by the U.S. Government,
its agencies or instrumentalities, certificates of deposit issued by domestic
banks, bankers acceptances, commercial paper and other corporate debt, and
repurchase agreements.

IAA Trust Money Market Series is a money market fund which seeks to maintain a
constant net asset value of $1.00 per share. Shares of a money market fund are
neither insured nor guaranteed by the U.S. Government and there is no assurance
that this Series will be successful in meeting its investment objective or in
maintaining a constant net asset value of $1.00 per share.

IAA Trust Short-Term Government Bond Series seeks maximum total return
consistent with the preservation of capital. The Series seeks to achieve its
investment objective by investing primarily in securities of the U.S. government
and its agencies and maintain an effective duration comparable to or less than
that of three-year U.S. Treasury Notes.

1
<PAGE>

IAA Trust Long-Term Bond Series seeks to provide as high a level of current
income and capital appreciation as possible, consistent with the preservation of
capital and the maintenance of liquidity. The Series seeks to achieve its
investment objective by investing in bonds and other debt obligations and
maintain an effective duration of 4-6 1/2 years.

The Funds' principal Underwriter is Fund/Plan Broker Services, Inc., #2 West Elm
Street, P.O. Box 874, Conshohocken, Pennsylvania 19428. Effective November 1,
1996, the Underwriter will have the new name of FPS Services, Inc. and will have
the new address of 3200 Horizon Drive, P.O. Box 61503, King of Prussia, PA
19406-0903

For information about how to invest in the IAA Trust Company Funds, contact
Fund/Plan Broker Services, Inc., or a local Country Capital Management Company
salesperson, or call toll-free 1 (800) 245-2100. In Bloomington/Normal, call
557-3222. Country Capital Management Company has a selling agreement with
Fund/Plan Broker Services, Inc. Shares of the Funds are sold only in states
where the Funds are registered.

This Prospectus sets forth concisely the information about the Funds that a
prospective investor ought to know before investing. Please read and retain this
Prospectus for future reference.

An investment in any of the Funds is neither insured nor guaranteed by the U.S.
Government. There can be no assurance that any Fund's investment objective will
be achieved. The investment objective of each Fund is fundamental and cannot be
changed without shareholder approval.

The value of each Fund's shares (with the exception of the Money Market Series)
fluctuate because the value of the securities in which each Fund invests
fluctuate. When the Funds sell portfolio securities, they may realize a gain or
a loss depending on whether they sell them for more or less than their cost. The
Funds will earn dividend or interest income to the extent that they receive
dividends or interest from their investments.

A Statement of Additional Information combining information about each of the
Funds has been filed with the Securities and Exchange Commission. This Statement
of Additional Information is incorporated by reference in its entirety in this
Prospectus. Copies of the Statement of Additional Information dated October 28,
1996 are available upon request and without charge by contacting Fund/Plan
Broker Services, Inc., at the address or telephone numbers listed above.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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<PAGE>

TABLE OF CONTENTS

Subject Page
- ------- ----

Synopsis....................................................................

Operating Expenses Tables...................................................

Financial Highlights........................................................

Performance Calculations....................................................

Investment Objectives and Policies..........................................

Investment Strategies and Risk Considerations...............................

Management of the Funds.....................................................

Management's Discussion of the Funds' Performance...........................

Distribution of the Funds' Shares...........................................

Distribution Plans..........................................................

Capital Stock...............................................................

Income Dividends, Capital Gains Distributions, and Taxes....................

Purchase of Shares..........................................................

Special Plans and Other Purchase Information................................

Valuation of Shares.........................................................

Redemption of Shares........................................................

3
<PAGE>

SYNOPSIS

The Funds

The securities offered by this Prospectus consist of shares of four separate
funds (collectively the "Funds"), each of which has distinct investment
objectives and policies. The Funds are open-end, diversified management
investment companies incorporated under the laws of the State of Maryland.
Investors should be aware that by combining the Prospectus of each Fund into
this one document, there is a remote possibility that one Fund may become liable
for any misstatements in the Prospectus about another Fund. To the extent that a
Fund incurs such liability, a shareholder's investment in such Fund could be
adversely affected.

The four Funds are identified herein as follows: IAA Trust Growth Fund, Inc.
(the "Growth Fund"); IAA Trust Asset Allocation Fund, Inc. (the "Asset
Allocation Fund"); IAA Trust Tax Exempt Bond Fund, Inc. (the "Tax Exempt Bond
Fund"), and IAA Trust Taxable Fixed Income Series Fund, Inc. (the " Taxable
Fixed Income Series Fund"). The Taxable Fixed Income Series Fund currently
consists of three Series: IAA Trust Money Market Series (the "Money Market
Series"); IAA Trust Short-Term Government Bond Series (the "Short-Term
Government Bond Series"); and IAA Trust Long-Term Bond Series (the "Long-Term
Bond Series").

Investment Definitions

Open-end - The term "open-end" means that a Fund continually offers new shares
for sale to the public and are legally obligated to buy back such shares held by
an investor and pay the investor the next determined net asset value of the
shares. This open-end type of investment company is commonly called a mutual
fund.

Diversified - The Funds are "diversified" because each invests in securities of
different companies and industries in an attempt to spread and reduce the risks
inherent in all investing. Diversification, however, does not imply that an
investor's capital will increase or that the purchase of Fund shares involves a
preservation of original capital and a protection against loss in value.

Management Investment Company - The Funds are separate "management investment
companies" because upon the advice of professional investment managers, each
Fund continuously reviews, and from time to time changes, its portfolio holdings
in an effort to achieve its investment objective.

Investment Objectives

Growth Fund:

This Fund has an investment objective of capital growth. This Fund seeks to
achieve its investment objective by investing principally in common stocks or
securities with equity characteristics.

Asset Allocation Fund:

This Fund seeks growth of capital and current income as near-equal objectives,
primarily through equity securities. In general, this Fund may hold a mix of
assets consisting of common stocks (both dividend and non-dividend paying),
preferred and convertible preferred stocks, fixed income securities including
bonds, bonds convertible into common stocks, and short-term interest bearing
obligations.

4
<PAGE>

Tax Exempt Bond Fund:

This Fund has an investment objective of seeking as high a level of current
interest income exempt from Federal income taxes as is available from municipal
bonds. This Fund seeks to achieve its objective by investing in a diversified
portfolio of municipal bonds, the interest from which is exempt from Federal
income tax in the opinion of bond counsel to the issuers.

Taxable Fixed Income Series Fund:
Money Market Series:

This Series has an investment objective of earning a high level of current
income, consistent with maintaining liquidity and stability of principal. This
Series attempts to maintain the value of its shares at a constant $1.00,
although there can be no assurance that the Series will be able to maintain a
stable net asset value of $1.00 per share. This Series seeks to achieve its
investment objective by investing in high-quality money market instruments
maturing in one year or less, including securities issued or guaranteed by the
U.S. Government, its agencies or instrumentalities, certificates of deposit
issued by domestic banks, bankers acceptances, commercial paper and other
corporate debt, and repurchase agreements. An investment in the Series is
neither insured nor guaranteed by the U.S. Government.

Short-Term Government Bond Series:

This Series seeks maximum total return consistent with the preservation of
capital. The Series seeks to achieve its investment objective by investing
primarily in securities of the U.S. Government and its agencies and maintain an
effective duration comparable to or less than that of three-year U.S. Treasury
notes.

Long-Term Bond Series:

This Series seeks to provide as high a level of current income as possible,
consistent with the preservation of capital and the maintenance of liquidity.
The Series seeks to achieve its investment objective by investing in bonds and
other debt obligations and maintain an effective duration of 4-6 1/2 years.

How to Buy Shares

The minimum initial single purchase for all the Funds is $1,000. The minimum
additional investment for all the Funds is $100. The public offering price of
shares of a Fund is the net asset value per share next determined after receipt
and acceptance of the purchase order at the Transfer Agent in proper form with
accompanying check or other bank wire arrangements satisfactory to the Funds.
See " PURCHASE OF SHARES".

How to Redeem Shares

Shares may be redeemed at the net asset value per share of a Fund next
determined after receipt by the Transfer Agent of a redemption request in proper
form. Signature guarantees may be required in some cases. See " REDEMPTION OF
SHARES".

Dividends and Reinvestment

The Growth Fund intends to pay semi-annual dividends from its net investment
income and may pay short-term capital gains, if earned and as declared by the
Board of Directors. Distributions of net capital gains, if any, will be paid
annually.

5
<PAGE>

The Asset Allocation Fund, Tax Exempt Bond Fund, Short-Term Government Bond
Series and Long-Term Bond Series pay monthly dividends from their respective net
investment income on the last business day of the month to shareholders of
record on the preceding business day. Distributions of net capital gains, if
any, will be paid annually.

The Money Market Series declares and pays dividends of all its daily net
investment income on each day the Fund's net asset value per share is
determined. Each shareholder receives a monthly summary of such amounts.

Any dividend and distribution payments will be reinvested at net asset value, in
additional full and fractional shares of the particular Fund unless and until
the shareholder notifies the Transfer Agent in writing requesting payments in
cash. Provisions of the Tax Reform Act of 1986 may result in additional net
investment income and/or capital gain distributions at the end of the calendar
year. See "INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS, AND TAXES".

Investment Management, Underwriter, and Servicing Agents

The IAA Trust Company, 808 IAA Drive, Bloomington, Illinois 61702 is the
Investment Adviser and Custodian for the Funds.

Fund/Plan Broker Services, Inc., #2 Elm Street, Conshohocken, Pennsylvania 19428
serves as the Funds' Underwriter. Fund/Plan Services, Inc., #2 Elm Street,
Conshohocken, Pennsylvania 19428 serves as the Funds' Administrator,
Accounting/Pricing Agent, and Transfer Agent. Effective November 1, 1996, the
Underwriter will have the new name of FPS Broker Services, Inc., the
Administrator, Accounting/Pricing Agent and Transfer Agent will have the new
name of FPS Services, Inc., and both entities will have the new address of 3200
Horizon Drive, P.O. Box 61503, King of Prussia, PA 19406-0903

6
<PAGE>

OPERATING EXPENSES TABLE

Tax Taxable Fixed
Asset Exempt Income
Growth Allocation Bond Series
Fund Fund Fund Fund
------ ---------- ------ --------------

Short-
Term Long-
Money Gov't Term
Market Bond Bond
Series Series(1) Series(1)
------ --------- ---------

Shareholder Transaction Expenses:

<S> <C> <C> <C> <C> <C> <C>
Maximum Sales Load Imposed on Purchases
(as a percentage of offering price) none none none none none none
Maximum Sales Load Imposed
on Reinvested Dividends none none none none none none
Deferred Sales Load none none none none none none
Redemption Fee none none none none none none
Exchange Fee none none none none none none

Annual Fund Operating Expenses:

(as a percentage of average net assets)

Management Fees 0.75% 0.75% 0.50% 0.50% 0.50% 0.75%
Waiver of Management Fees 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
12(b)1 Fees 0.25% 0.25% 0.25% none 0.25% 0.25%
Other Expenses 0.14% 0.46% 0.31% 0.23% 0.57% 0.57%
----- ----- ----- ----- ----- -----
Total Fund Operating Expenses 1.14% 1.46% 1.06% 0.73% 1.32% 1.57%

</TABLE>

(1) With respect to Short-Term Government Bond Series and Long-Term Bond Series
(which will commence investment operations on November 1, 1996) the ratios shown
are those expected to be incurred for the first fiscal period for these new
Series.

<TABLE>
<CAPTION>
Example:

<S> <C> <C> <C> <C> <C> <C>
You would pay the following expenses 1 year $41 $44 $40 $7 $ $
on a $1,000 investment, assuming 3 years $65 $75 $63 $23 $ $
(1) 5% annual return and (2) redemption 5 years $91 $107 $87 $41 $ $
at the end of each time period 10 years $164 $199 $156 $91 $ $

</TABLE>

The purpose of these tables are to assist the investor in understanding the
various costs and expenses that an investor in the Funds will bear directly and
indirectly. This information has been restated to reflect current fees as if
they had been in effect during the previous fiscal year. The information
contained in the tables should not be considered a representation of future
expenses. Actual expenses may be greater than or less than those stated.

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<PAGE>

FINANCIAL HIGHLIGHTS

The following financial highlights are a part of the Funds' financial statements
which have been audited by Coopers & Lybrand L.L.P., independent accountants,
for the most recent five years. The Funds' most recent annual audited financial
statements and the report of Coopers & Lybrand L.L.P. thereon appear in the
Funds' Statement of Additional Information. The following tables should be read
in conjunction with these financial statements and related notes also included
in such Statement of Additional Information.

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

8
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FINANCIAL HIGHLIGHTS

ASSET ALLOCATION FUND:

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

9
<PAGE>

FINANCIAL HIGHLIGHTS

TAX EXEMPT BOND FUND:

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

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FINANCIAL HIGHLIGHTS

TAXABLE FIXED INCOME SERIES FUND
MONEY MARKET SERIES:

The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.

11
<PAGE>

PERFORMANCE CALCULATIONS

From time to time, the Funds may advertise performance measures such as total
percentage increase, total return, and yield. Whenever total percentage increase
or yield is advertised, total return will be advertised as well. The following
is a brief explanation of how these figures are obtained.

Yields

With respect to the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Short-Term Government Bond Series and the Long-Term Bond Series, yield is a
measure of the total current income for the 30-day period ended on the given
date, stated as a percentage of the original investment. With respect to the
Money Market Series, yield is a measure of the total current income for the
7-day period ended on the given date. This percent is annualized and compounded,
which means that the income is assumed to be earned and reinvested over a
one-year period. Effective yield is computed in the same manner, except that
income is assumed to have been reinvested over a one-year period. Yield differs
from total percentage increase and total return since it only considers current
income and does not take into account gains or losses on securities held by a
Fund or Series.

With respect to the Tax Exempt Bond Fund, tax-equivalent yield is the yield
which would be required from a fund whose income is subject to Federal income
tax in order to equal the amount of after-tax income received by a shareholder
based on the tax exempt yield of this Fund. The rate simplifies the comparison
of yields of tax exempt funds with yields of taxable funds.

Total Percentage Increase

Total percentage increase is calculated for the specified periods of time by
assuming a hypothetical investment of $1,000 in a Fund's shares. Each dividend
or other distribution is treated as having been reinvested at net asset value on
the reinvestment date. The percentage increases stated are the percent that an
original investment would have increased during the applicable period.

Total Return

Total return is calculated in the same way as the total percentage increase
except that it is stated in terms of a level one-year compound rate of return
(all earnings reinvested on an annual basis) over the investment period.

Advertisements of the Funds' performance may also include the ending value of
the illustrated investment for the period stated. This is the amount that would
be received by a shareholder who sold all shares at the end of the stated
period.

The above performance measures are based on historical earnings and are not
intended to indicate future performance.

12
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INVESTMENT OBJECTIVES AND POLICIES

The investment objective of each Fund is fundamental and may not be changed
without a vote of the holders of the majority of the voting securities of the
Fund. Unless otherwise stated in this Prospectus or the Statement of Additional
Information, each Fund's investment policies are not fundamental and may be
changed without shareowner approval. While a non-fundamental policy or
restriction may be changed by the Directors of the Fund without shareowner
approval, the Funds intend to notify shareowners before making any change in any
such policy or restriction. Fundamental policies may not be changed without
shareowner approval. The Funds strive to attain their investment objectives, but
there can, of course, be no assurance that they will do so.

GROWTH FUND:

The investment objective of the Growth Fund is capital growth. Current income
through the receipt of interest or dividends from investments will be secondary
to this Fund's goal of capital growth. Thus, the Fund is not intended for
investors whose principal objective is dividend income. Achievement of the
Fund's objective cannot be assured, but through professional management, the
Fund will seek to obtain results which are in keeping with its objective.
Although the portfolio of the Fund may be restructured at times for temporary
defensive purposes, it is the intention of the Board of Directors that no
material change of a permanent nature will be made in the Fund's investment
objective without the approval of the holders of at least a majority of the
Fund's outstanding capital stock.

In seeking capital growth, the Growth Fund will constantly search for the best
values and will make investment decisions based primarily upon fundamental
valuation of securities. The Fund will dispose of securities held whenever, in
the judgment of its management, such securities do not represent the best values
for the purpose of achieving the Fund's objective. This can occur for a variety
of reasons, such as an increase in the market value of a

13
<PAGE>

particular security to what is believed to be an unreasonably high level, a
change in trend of growth which was used as a basis of purchase, what is
believed to be a vulnerable general level of security prices, and other such
circumstances bearing on the desirability of continuing a given investment.
Under ordinary circumstances, securities will be held for periods of time
sufficient to qualify for long-term capital gain treatment for Federal income
tax purposes.

The Growth Fund's investment policy is to invest principally in common stocks
and securities with equity characteristics, such as convertible preferred stocks
and convertible bonds; however, it may invest fully in common stocks or
securities with equity characteristics. To a lesser extent, the Fund may also
invest in bonds and preferred stocks when deemed prudent. The Fund may adopt a
temporary defensive position when it deems advisable due to a change in economic
conditions. This may be done by establishing and maintaining a reserve in: cash;
short-term U.S. Government bonds, bills or notes; prime commercial paper of
major companies; and certificates of deposit issued by major banks, for the
purpose of providing working capital, funds for possible redemption of shares,
or to enable the Fund to take advantage of buying opportunities. The adoption of
any such temporary defensive position will be on a temporary basis and will not
be utilized to change the long-term investment objective and policies of the
Fund. The word "temporary" as used in the preceding sentence should not be read
as having a fixed meaning in the sense that it designates any fixed period of
time.

When investing in fixed income securities, the Growth Fund's management intends
to invest in those securities which are rated at the time of purchase within the
four highest grades assigned by Moody's Investors Service, Inc. ("Moody's")
("Aaa", "Aa", "A", or "Baa") or Standard & Poor's Corporation ("S&P") ("AAA",
"AA", "A", or "BBB"); or in those securities, although not rated as a matter of
policy by either of the above two ratings services, which are considered by
management to have investment quality comparable to securities that fall within
the four highest grades assigned by the above two rating services. In the event
a fixed income security held by the Fund is downgraded below a "Baa" or "BBB"
rating, the Investment Adviser (IAA Trust Company) shall promptly reassess the
risks involved and take such actions as it determines are in the best interests
of the Fund and its shareholders. See the Appendix to the Statement of
Additional Information for explanations on applicable ratings.

14
<PAGE>

ASSET ALLOCATION FUND:

The primary investment objective of the Asset Allocation Fund is growth of
capital with current income. The Fund seeks to achieve its objective by
following an asset allocation strategy utilizing a wide range of equity, debt,
and money market securities. Asset classes and securities strategies selected
will be those that the Investment Adviser believes offer the greatest potential
for maximizing total return.

Income and capital appreciation will be derived from the Asset Allocation Fund's
investment in common stocks and fixed income securities consisting of bonds,
preferred stocks, and short-term obligations. Short-term obligations are
instruments maturing in one year or less (measured from the time of investment)
and include: obligations of or guaranteed by the U.S. Government, its agencies
or instrumentalities; certificates of deposit of domestic banks; commercial
paper rated in the top two grades -- "Prime-1" or "Prime-2" by Moody's or "A-1"
or "A-2" by S&P; non-convertible corporate debt securities such as bonds, notes
and debentures which are rated in the top two grades -- "Aaa" or "Aa" by Moody's
or "AAA" or "AA" by S&P; negotiable certificates of deposit of savings and loan
associations; and repurchase agreements. Fixed income securities may have equity
conversion privileges or other equity features, including attached warrants or
rights.

When investing in fixed income securities, the Asset Allocation Fund's
management intends to invest in those securities which are rated at the time of
purchase within the four highest grades assigned by Moody's ("Aaa", "Aa", "A",
or "Baa") or S&P ("AAA", "AA", "A", or "BBB"); or in those securities, although
not rated as a matter of policy by either of the above two rating services,
which are considered by management to have investment quality comparable to
securities that fall within the four highest grades assigned by the above two
rating services. In the event a fixed income security held by the Fund is
downgraded below a "Baa" or "BBB" rating, the Investment Adviser shall promptly
reassess the risks involved and take such actions as it determines to be in the
best interest of the Fund and its shareholders. See the Appendix to the
Statement of Additional Information for explanations on applicable ratings.

Although it is not the intent of the Asset Allocation Fund's management to trade
for short-term profits, purchases and sales of securities will be made whenever
management deems it would contribute to the achievement of the Fund's objective.
The Fund will be invested in securities representing a number of different
industry classifications and does not intend to concentrate its investments in a
particular industry. In addition to domestic securities, the Fund may invest in
Canadian and other foreign securities, both corporate and government, which are
payable in United States dollars. To the extent that the Fund does invest in
foreign securities, such investments may be subject to special risks, such as
changes in the administration or economic and monetary policies of foreign
governments. However, the Fund will not invest as much as 5% of its total assets
in foreign securities.

15
<PAGE>

TAX EXEMPT BOND FUND:

The investment objective of the Tax Exempt Bond Fund is to seek as high a level
of current interest income exempt from Federal income taxes as is available from
municipal bonds, consistent with the conservation of capital. The Fund's
investments (and thus the value of shares held by shareholders) will be subject
to the market fluctuations and risks inherent in all securities, and there can
be no assurance that the Fund's stated objective will be realized. Although the
investment objective of the Fund may be changed by the Board of Directors, it is
the intention of the Board that no material change of a permanent nature will be
made in the Fund's investment objective without the approval of the holders of
at least a majority of the Fund's outstanding capital stock.

The Tax Exempt Bond Fund will seek to achieve its objective by investing
substantially all of its assets in a diversified portfolio of debt obligations
issued by or on behalf of states, territories or possessions of the United
States and the District of Columbia or their political subdivisions, agencies
and instrumentalities, or multi-state agencies or authorities, the interest from
which is exempt from Federal income taxes in the opinion of bond counsel to the
issuers. Under normal market conditions, the Fund will maintain at least 80% of
its net assets in tax exempt municipal bonds (not including assets invested in
temporary investments for defensive purposes-- see following paragraph). This
80% limitation is considered a fundamental policy and may be changed only in the
manner by which other fundamental policies may be changed; by the approval of
the holders of at least a majority of the Fund's outstanding capital stock. The
Fund's assets will consist of: (1) municipal bonds which are rated at the time
of purchase within the four highest grades assigned by Moody's ("Aaa", "Aa",
"A", or "Baa") or S&P ("AAA", "AA", "A", or "BBB"), or in those municipal bonds,
although not rated as a matter of policy by either of the above two rating
services, which are considered by management to have investment quality
comparable to municipal bonds that fall within the four highest grades assigned
by the above two rating services (municipal bonds rated "Baa" or "BBB" have
speculative characteristics); (2) temporary investments as described below; and
(3) cash. While ratings at the time of purchase will determine which securities
may be acquired, a subsequent reduction in rating will not require the Fund to
dispose of the securities. See the Appendix to the Statement of Additional
Information for explanations on applicable ratings. No limitations are imposed
as to the percentage of the Fund's assets which may be invested among Moody's or
S&P's highest four ratings; however, the Fund will not invest more than 20% of
its net assets (measured at the time of investment) in municipal bonds which are
not rated, or in taxable investments, or in investments subject to the
alternative minimum tax.

Pending investment of proceeds from the sale of the Tax Exempt Bond Fund's
shares, the changing of portfolio composition, and from time to time when deemed
appropriate by the Investment Adviser for defensive purposes, the Fund may
invest in temporary investment securities. Temporary investment securities
consist of: (1) notes issued by or on behalf of municipal issuers backed by the
Federal Government; (2) notes of issuers having, at the time of purchase, an
outstanding issue of municipal bonds rated within the four highest grades of
Moody's or S&P; (3) municipal notes rated at the time of purchase within the two
highest grades assigned by Moody's ("MIG-1" and "MIG-2"); (4) obligations of the
United States Government, its agencies or instrumentalities; (5) bonds, notes
and certificates rated within the four highest grades of Moody's or S&P; (6)
commercial paper rated within the two highest grades assigned by Moody's ("P-1"
or "P-2") or by S&P ("A-1 or "A-2"); and (7) debt securities (including
repurchase agreements) issued or guaranteed by domestic banks having investment
quality, in management's opinion, comparable to debt securities of the type
described in category (5) above. The income from the securities described in
categories (4) through (7) above, is subject to Federal income taxes.
Consequently, interest income from temporary investments may be taxable to
shareholders as ordinary income. The investment policies set forth in this
paragraph are non-fundamental and therefore may be changed by the Board of
Directors.

16
<PAGE>

TAXABLE FIXED INCOME SERIES FUND:
MONEY MARKET SERIES:

The investment objective of the Money Market Series is to earn as high a level
of current income as possible, consistent with maintaining liquidity and
stability of principal. In pursuing its objective, the Series may not always
purchase securities offering the highest yield. The Series will only invest in
high-quality rated

17
<PAGE>

securities or unrated securities determined by the Board of Directors to be of
high-quality and present minimum credit risk. There can be no assurance that the
Series' stated objective will be realized. Although the investment objective of
the Series may be changed by the Board of Directors, it is the intention of the
Board that no material change of a permanent nature will be made in the Series'
investment objective without the approval of the holders of at least a majority
of the Fund's outstanding capital stock.

The Money Market Series seeks to achieve its objective by investing in the
following types of money market instruments, which are maturing in one year or
less, measured from the time of investment:

o Obligations of, or guaranteed by, the U.S. Government, its agencies or
instrumentalities.

o Certificates of deposit of domestic banks in amounts (currently $100,000)
that are fully insured by The Federal Deposit Insurance Corporation ("The
FDIC") and, for larger amounts, bank certificates of deposit or bankers
acceptances of domestic banks having total assets in excess of $1 billion
and which are members of The FDIC. The Series may purchase both negotiable
and non-negotiable certificates of deposit. Non-negotiable certificates of
deposit are not purchased or sold in a secondary trading market and must be
held to maturity unless, at the request of the Series , the issuer agrees
to redeem them earlier, possibly at less than par. Accordingly, the Series
will not invest more than 10% of its net assets in non-negotiable
certificates of deposit or in other illiquid, restricted securities so that
this potential liquidity risk will be minimal.

o Commercial paper rated in the top grade by two nationally recognized
statistical rating organizations (NRSRO's) one of which must be either
Moody's Investors Service, Inc., or Standard & Poor's Corporation.

o Non-convertible corporate debt securities such as bonds, notes and
debentures which are rated in the top grade -- "Aaa" by Moody's or "AAA" by
S&P.

o Negotiable certificates of deposit of savings and loan associations in
amounts (currently $100,000) that are fully insured by The FDIC.

o Repurchase agreements of obligations which are suitable for investment
under the categories set forth above and issued by a member bank or certain
broker/dealers who have been approved by the Board of Directors and are
participating in the Federal Reserve System. The Series will only invest in
repurchase agreements maturing in seven days or less.

SHORT-TERM GOVERNMENT BOND SERIES:

The investment objective of the Short-Term Government Bond Series is to provide
maximum total return, consistent with preservation of capital and prudent
investment management. Total return consists of interest, and

18
<PAGE>

dividends from underlying securities and capital appreciation realized from the
purchase and sale of securities. Under normal conditions, the Series seeks to
achieve its objective by investing at least 65% of the value of its total assets
in U.S. Government securities, including bonds, notes, and bills which are (a)
direct obligations of the U.S. Treasury, and (b) securities issued or guaranteed
by U.S. Government agencies.

Government securities may be backed by (i) the full faith and credit of the
United States; (ii) the particular Government agency's ability to borrow
directly from the Treasury; (iii) some other type of United States support; or
(iv) the credit of the issuing agency, only. The government guarantee of the
U.S. Government securities in the Series' portfolio, however, does not guarantee
the net asset value of the shares of the Series. There are market risks inherent
in all investments in securities, and the value of an investment in the Series
will fluctuate over time. Normally, the value of the Series' investments varies
inversely with changes in interest rates. For example, as interest rates rise,
the value of the Series' investments will tend to decline, and as rates fall,
investment values tend to increase.

The Series expects to maintain a dollar-weighted average portfolio effective
duration comparable to or less than that of three-year U.S. Treasury Notes.
Because the manager seeks to minimize interest rate risk by managing effective
duration, the Series may invest in securities of any maturity.

The Series is designed primarily for investors who seek higher yields than money
market funds generally offer and are willing to accept nominal fluctuation in
the value of the shares but who are not willing to accept the greater
fluctuations that long-term bond funds might entail. This Series is not an
appropriate investment for investors whose primary investment objective is
absolute principal stability. Because the values of the securities in which this
Series invests generally change with interest rates, the value of its shares
will fluctuate, unlike the value of the shares of a money market fund, seeking
to maintain a stable net asset value per share of $1.00. Consequently, this
Series seeks to reduce such fluctuations by managing the effective duration, and
thus the interest rate risk, of its portfolio.

The Series also may invest up to 35% of its total assets in cash, commercial
paper and high grade liquid debt securities, including corporate debt
instruments and privately issued mortgage-related and asset-backed securities
rated within the three highest grades assigned by S&P (AAA, AA, A or A-1) or
Moody's (Aaa, Aa, A or P-1) or in unrated securities such as Certificates of
Deposit issued by Banks, Bankers' Acceptances, and Repurchase Agreements deemed
by the manager to be of comparable quality. Further, the Series may invest in
long-term fixed rate bonds that allow the Series to tender (or "put") bonds to
the issuer at specified intervals and receive face value for them. In addition,
the Series may invest in other investment companies investing primarily in U.S.
Government securities for the appropriate duration.

LONG-TERM BOND SERIES:

The investment objective of the Long-Term Bond Series is to provide the maximum
amount of current income and capital appreciation to the extent consistent with
the preservation of capital and the maintenance of liquidity. The Series invests
principally in debt obligations of corporations, the U.S. Government and its
agencies and instrumentalities, and major U.S. banking institutions and may also
purchase obligations of international agencies and U.S. dollar denominated
foreign debt securities.

At least 80% of the value of the Series' net assets will consist of obligations
of corporations which, at the time of purchase by the Series are rated at least
A- by S&P or A3 by Moody's, and of securities issued or guaranteed as to
principal and interest by the U.S. Government or its agencies or
instrumentalities. The Series may also invest in securities which, while not
rated, are determined by the investment manager to be of comparable quality to
those rated securities in which the Series may invest; for purposes of the 80%
requirement described in this paragraph, such unrated securities shall be deemed
to have the ratings so determined. See the Appendix to the Statement of
Additional Information for explanations on applicable ratings. In addition, at
least 65% of the value of the Series'

19
<PAGE>

net assets (except when maintaining a temporary defensive position) will be
invested in bonds, notes, and convertible issues.

On occasion, up to 20% of the Series' net assets may consist of commercial paper
of U.S. issuers rated A-1 or A-2 by S&P or P-1 or P-2 by Moody's, certificates
of deposit, time deposits and bankers' acceptances, and corporate bonds which
are rated in any category lower than A- by S&P and A3 by Moody's. When deemed
necessary for temporary defensive purposes, the Series' investment in commercial
paper, certificates of deposit, time deposits and bankers' acceptances may
exceed 20% of its net assets, although the Series currently does not intend to
invest more than 5% of its assets in any one of these types of instruments.
Commercial paper and certificates of deposit could be over 5%. Under no
circumstances will the Series invest more than 20% of its net assets in
corporate bonds which are rated lower than A- by S&P and A3 by Moody's or are
unrated. Obligations rated BBB by S&P and Baa by Moody's are considered
investment grade obligations which lack outstanding investment characteristics
and may have speculative characteristics as well. See the Appendix to the
Statement of Additional Information for explanations on applicable ratings. The
Series may invest up to 10% of its assets in securities of foreign issuers.

INVESTMENT STRATEGIES AND RISK CONSIDERATIONS

Shareowners should understand that all investments involve risk and there can be
no guarantee against loss resulting from an investment in the Funds. Unless
otherwise indicated, all percentage limitations governing the investments of the
Funds apply only at the time of transaction.

Securities of Other Investment Companies

All Funds may purchase or acquire securities of other investment companies on
the open market if immediately after such purchase or acquisition, the Fund
would not own in the aggregate: (1) more than 3% of the total outstanding voting
stock of such other investment company; (2) securities issued by such other
investment company having an aggregate value in excess of 5% of the value of the
Fund's total assets; or (3) securities issued by such other investment company
and all other investment companies having an aggregate value in excess of 10% of
the value of the Fund's total assets. By investing in another registered
investment company, there may be a duplication in fees and expenses.

Repurchase Agreements

All Funds may enter into repurchase agreements which are transactions in which
the Funds purchase a security (usually a U.S. Government obligation) and
simultaneously obtain the commitment of the seller to repurchase the security at
an agreed upon price on an agreed upon date, usually not more than seven days
from the date of purchase. The resale price reflects the purchase price plus an
agreed upon market rate of interest which is unrelated to the coupon rate or
maturity of the purchased security. Such transactions afford an opportunity for
a Fund to earn a return on cash which is only temporarily available. The Fund's
risk is limited to the ability of the seller to pay the agreed upon sum upon the
delivery date, but the seller's obligation is in effect secured by the value of
the underlying security. The Funds will only invest in repurchase agreements of
domestic banks maturing in seven days or less and will not invest in repurchase
agreements of broker-dealers.

Still, there are certain risks involved with the use of certain repurchase
agreements. For example, if the seller should default on its obligation to
repurchase the securities, a Fund may experience delay or difficulties in
exercising its rights upon the securities held as collateral and might incur a
loss if the value of the securities should decline. A Fund also might incur
disposition costs in connection with liquidating the securities. While the Funds
acknowledge these risks, it is expected that they can be controlled through
careful monitoring procedures offered by the Funds' Investment Adviser.

Municipal Bonds

20
<PAGE>

The Tax Exempt Bond Fund may purchase municipal bonds which are generally debt
obligations issued by states, territories and possessions of the United States
and the District of Columbia and their political subdivisions, agencies and
instrumentalities. They are issued to obtain funds for various public purposes,
including the construction of a wide range of public facilities such as:
airports; bridges; highways; hospitals; housing; mass transportation; schools;
streets; and water and sewer works. Other public purposes for which municipal
bonds may be issued include obtaining funds for general operating expenses, and
obtaining funds to lend to other public institutions and facilities. In
addition, certain types of industrial development bonds are issued by or on
behalf of public authorities to obtain funds to provide: privately-operated
housing facilities; airports; mass transit; industrial, port or parking
facilities; air or water pollution control facilities; and certain facilities
for water supply, gas, electricity, or sewage or solid waste disposal. Other
types of facilities and certain industrial development bonds, the proceeds of
which are used for the acquisition, construction, reconstruction or improvement
of or to provide equipment for privately-operated industrial or commercial
facilities, may qualify as municipal bonds, although current Federal tax laws
place substantial limitations on the size of such funds. Moreover, when an
industrial development bond is backed only by the assets and revenue of the
non-governmental user, then such non-governmental user is deemed to be the
issuer.

The two principal classifications of municipal bonds are "general obligation
bonds" and "revenue bonds". General obligation bonds are secured by the issuer's
pledge of its faith, credit and taxing power for the payment of principal and
interest. The taxes or special assessments that can be levied for the payment of
debt service may be limited or unlimited as to rate or amount. Revenue bonds are
payable only from the revenues derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special excise or other
specific revenue source, but not from the general taxing power. Tax exempt
industrial development bonds are in most cases revenue bonds and do not
generally carry the pledge of the credit of the insurer of such bonds. There
are, of course, variations in the security of municipal bonds, both within a
particular classification and between classifications. The Fund's portfolio may
consist of any combination of general obligation bonds, revenue bonds, and
industrial revenue bonds, and it can be expected that the ratios of such bonds
will vary from time to time.

Yields on municipal bonds are dependent on, among other things, general money
market conditions, conditions of the municipal bond market, size of a particular
offering, maturity of the obligation, the financial condition of the issuer, and
the rating of the issue. Additionally, the imposition of the Fund's management
fee, as well as other operating expenses, will have the effect of reducing the
yield to investors. Proposals have been introduced periodically before Congress
to restrict or eliminate the Federal income tax exemption for interest on
municipal bonds. Similar proposals may be introduced in the future. If such a
proposal was enacted, the availability of municipal bonds for investment by the
Fund and the value of the Fund's portfolio would be affected. In such event, the
Fund would reevaluate its objective and policies and consider recommending to
its shareholders changes in the structure of the Fund.

Government Securities

The Long-Term Bond Series may invest in securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities which includes U.S.
Treasury securities, which differ in their interest rates, maturities and times
of issuance. Treasury Bills have initial maturities of one year or less;
Treasury Notes have initial maturities of one to ten years; and Treasury Bonds
generally have initial maturities of greater than ten years. Some obligations
issued or guaranteed by U.S. Government agencies and instrumentalities, for
example, Government National Mortgage Association pass-through certificates, are
supported by the full faith and credit of the U.S. Treasury; others, such as
those of the Federal Home Loan Banks, by the right of the issuer to borrow from
the Treasury; others, such as those issued by the Federal National Mortgage
Association, by discretionary authority of the U.S. Government to purchase
certain obligations of the agency or instrumentality; and others, such as those
issued by the Student Loan Marketing Association, only by the credit of the
agency or instrumentality. These securities bear fixed, floating or variable
rates of interest. Principal and interest may fluctuate based on generally
recognized reference rates or the relationship of rates. While the U.S.
Government provides financial support to such U.S. Government sponsored agencies
or instrumentalities, no assurance can be given that it will always do so since
it is not so obligated by law.

21
<PAGE>

The Series will invest in such securities only when it is satisfied that the
credit risk with respect to the issuer is minimal.

Zero Coupon Securities

The Long-Term Bond Series may invest in zero coupon U.S. Government securities,
which are U.S. Government obligations that have been stripped of their unmatured
interest coupons, the coupons themselves and receipts or certificates
representing interests in such stripped debt obligations and coupons. The Series
also may invest in zero coupon securities issued by corporations and financial
institutions and by foreign governments where such securities are denominated in
U.S. dollars. A zero coupon security pays no interest to its holder during its
life and is sold at a discount to its face value at maturity. The amount of the
discount fluctuates with the market price of the security. The market prices of
zero coupon securities generally are more volatile than the market price of
securities that pay interest periodically and are likely to respond to a greater
degree to changes in interest rates than non-zero coupon securities having
similar maturities and credit qualities.

Mortgage-Related Securities

The Long-Term Bond Series may invest in mortgage-related securities which are
collateralized by pools of mortgage loans assembled for sale to investors by
various governmental agencies, such as Government National Mortgage Association
and government-related organizations such as Federal National Mortgage
Association and Federal Home Loan Mortgage Corporation, as well as by private
issuers such as commercial banks, savings and loan institutions, mortgage banks
and private mortgage insurance companies, and similar foreign entities.
Mortgage-related securities are a form of derivative securities. The
mortgage-related securities in which the Series may invest include those with
fixed, floating and variable interest rates and those with interest rates that
change based on multiples of changes in interest rates. Although certain
mortgage-related securities are guaranteed by a third party or otherwise
similarly secured, the market value of the security, which may fluctuate, is not
so secured. If a mortgage-related security is purchased at a premium, all or
part of the premium may be lost if there is a decline in the market value of the
security, whether resulting from changes in interest rates or prepayments in the
underlying mortgage collateral. As with other interest-bearing securities, the
prices of certain mortgage-backed securities are inversely affected by changes
in interest rates. However, although the value of a mortgage-related security
may decline when interest rates rise, the converse is not necessarily true,
since in periods of declining interest rates the mortgage underlying the
security are more likely to be prepaid. For this and other reasons, a
mortgage-related security's stated maturity may be shortened by unscheduled
prepayments on the underlying mortgage and, therefore, it is not possible to
predict accurately the security's return to the Series. The Series also may
invest in collateralized mortgage obligations structures on pools of mortgage
pass-through certificates or mortgage loans. The issuers of collateralized
mortgage obligations typically do not have assets other than those pledged to
secure separately the obligations. Holders of these obligations must rely
principally on distributions on the underlying mortgage related securities and
other collateral securing the obligations for payments of principal and interest
on the obligations. If the collateral securing the obligations is insufficient
to make payments on the obligations, a holder could sustain a loss.
Collateralized mortgage obligations will be purchased only if rated in one of
the two highest rating categories by a nationally recognized rating organization
such as Moody's or S&P.

Fixed-Income Securities

All Funds may invest in fixed-income securities. Even though interest-bearing
securities are investments which promise a stable stream of income, the prices
of such securities are inversely affected by changes in interest rates and,
therefore, are subject to the risk of market price fluctuations. The values of
fixed-income securities also may be affected by changes in the credit rating or
financial condition of the issuing entities. Once the rating of a portfolio
security has been changed, the Fund will consider all circumstances deemed
relevant in determining whether to continue to hold the security. The Growth
Fund, the Asset Allocation Fund, and the Tax Exempt Bond Fund may purchase
fixed-income securities rated Baa by Moody's and BBB by S&P. Such securities may
be subject to the aforementioned risk with respect to the issuing entity and to
greater market fluctuations than certain

22
<PAGE>

lower yielding, higher rated fixed-income securities. Obligations which are
rated Baa are considered medium grade obligations; they are neither highly
protected nor poorly secured, and are considered by Moody's to have speculative
characteristics. Bonds rated BBB by S&P are regarded as having adequate capacity
to pay interest and repay principal, and while such bonds ordinarily exhibit
adequate protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay interest and
repay principal for bonds in this category than in higher rated categories.

Forward Commitments and When-Issued Securities

The Long-Term Bond Series may purchase securities on a forward commitment or
when-issued basis, which means that the price is fixed at the time of
commitment, but delivery and payment ordinarily take place a number of days
after the commitment to purchase. The Series will make commitments to purchase
such securities only with the intention of actually acquiring the securities,
but the Series may sell these securities before the settlement date if it is
deemed advisable. The Series will not accrue income in respect of a forward
commitment or when-issued security prior to its stated delivery date.

Securities purchased on a forward commitment or when-issued basis and the
securities held in the Long-Term Bond Series portfolio are subject to changes in
value (both generally changing in the same way, i.e., appreciating when interest
rates decline and depreciating when interest rates rise) based upon the public's
perception of the creditworthiness of the issuer and changes, real or
anticipated, in the level of interest rates. Securities purchased on a forward
commitment or when-issued basis may expose the Series to risk because they may
experience such fluctuations prior to their actual delivery. Purchasing
securities on a forward commitment or when-issued basis can involve the
additional risk that the yield available in the market when the delivery takes
place actually may be higher than that obtained in the transaction itself. A
segregated account of the Series consisting of cash, cash equivalents or U.S.
Government securities or other high quality liquid debt securities at least
equal at all times to the amount of the forward commitment or when-issued
securities will be established and maintained at the Series' custodian bank.
Purchasing securities on a forward commitment or when-issued basis when the
Series is fully or almost fully invested may result in greater potential
fluctuation in the value of the Series' net assets and its net asset value per
share.

Foreign Securities

Since up to 10% of the Long-Term Bond Series' portfolio may consist of
securities of foreign issuers, the Series may be subject to investment risks as
to these securities that are greater in some respects than those incurred by a
Series which invests only in securities of U.S. domestic issuers. Such risks
include future political and economic developments, the possible imposition of
foreign withholding taxes on interest income payable on the securities, the
possible establishment of exchange controls, the possible seizure or
nationalization of foreign deposits, or the adoption of other foreign
governmental restrictions which might adversely affect the payment of principal
and interest on such securities.

MANAGEMENT OF THE FUNDS

The operations of each Fund are under the direction of a Board of Directors who
have been elected by the shareholders of each Fund. The Board meets regularly to
review the activities of the Officers, who are responsible for day to day
operations of the Funds. To assist the Directors and Officers in carrying out
their duties and responsibilities, the Funds have employed IAA Trust Company
("IAATC"), 808 IAA Drive, Bloomington, Illinois, as their Investment Adviser
under written Agreements which are renewable annually by the Funds' Board of
Directors or by votes of a majority of each Fund's outstanding voting
securities. Any such renewals must also be approved by the votes of a majority
of each Fund's Directors, who are not parties to the Agreement or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approvals. The Agreements may be terminated without penalty at
any time by the Board of Directors of a Fund, or by votes of the shareholders,
or by IAATC upon sixty days written notice, and they terminate automatically in
the event of their

23
<PAGE>

assignment. IAATC was organized on December 30, 1970 and has no investment
company clients other than the IAA Trust Mutual Funds discussed herein. Illinois
Agricultural Holding Co. owns all of the outstanding voting securities of IAATC.
Approximately 98% of the issued and outstanding voting stock of the Illinois
Agricultural Holding Co. is owned by the Illinois Agricultural Association
("IAA"). IAA is an Illinois not-for-profit membership corporation organized to
promote the interest of agriculture.

IAATC, subject to the authority of the Board of the Funds, is generally
responsible for the overall management of the Funds' business. For these
services performed and expenses assumed, the Growth Fund, the Asset Allocation
Fund and the Long-Term Bond Series each pay IAATC an annual fee of approximately
.75% of their respective average daily net assets. These fees are considered
higher than the advisory fees paid by most other mutual funds; however, these
fees are comparable with those of other mutual funds with similar investment
objectives. The Tax Exempt Bond Fund, the Money Market Series and the Short-Term
Government Bond Series each pay IAATC an annual fee of approximately .50% of
their respective average daily net assets. All of these fees are computed on a
daily basis and are paid monthly. Neither IAATC nor any company affiliated with
it receives any brokerage commissions from the Funds, as such business is
transacted with non-affiliated broker-dealers.

The following persons who are Officers and/or Directors of the Funds also hold
positions with IAATC as indicated: Ronald R. Warfield, Director and President;
Wayne A. Brown, Senior Vice President--Investments; Gary E. Mede, Executive Vice
President; Richard M. Miller, Senior Vice President and Senior Trust Officer;
Rollie D. Moore, Director and Vice President; Paul M. Harmon, Secretary; Robert
W. Weldon, Vice President--Finance and Treasurer; Richard F. Day, Controller.

24
<PAGE>

MANAGEMENT'S DISCUSSION OF FUNDS' PERFORMANCE

GROWTH FUND:

The net asset value of the Growth Fund closed the fiscal year on June 30, 1996
at $ ____ per share. The figures below show historical compound annual returns
of Fund shares with dividends reinvested.

1 Year 5 Years 10 Years
------ ------- --------

% % %

These annual returns are for prior years' performance. Returns in future periods
cannot be guaranteed, and the value of Fund shares can fluctuate either above or
below their original cost.

25
<PAGE>

Bruce Finks, Investment Officer for the Growth Fund: Earned a B.S. in
Business Administration from Illinois State University in Normal in 1976,
and is also a Chartered Financial Analyst. Mr. Finks is responsible for the
management of common stock portfolios for individual and institutional
clients and has been with IAA Trust Company since 1992, following fifteen
years of investment management experience with banking organizations.

26
<PAGE>

ASSET ALLOCATION FUND:

The annualized total returns for the Asset Allocation Fund for the period ended
June 30, 1996 are as follows:

1 Year 5 Years 10 Years
------ ------- --------

% % %

27
<PAGE>

John Jacobs, Investment Officer for the Asset Allocation Fund: Earned a
B.S. in Business and Finance at Illinois Wesleyan University in
Bloomington. Mr. Jacobs is also a Chartered Financial Analyst, and has
served as a member of IAA Trust Company's Investment Committee. Prior to
joining the Company in 1975, he was an account executive for one of the
leading national brokerage firms.

Michael E. Marks: Earned his B.S. in Business Administration from
Washington University in St. Louis, his M.B.A. from Indiana University in
Bloomington, and is currently pursuing the Chartered Financial Analyst
certification. Prior to graduate school, he was a management consultant for
Price Waterhouse's Strategic Consulting Group. Mr. Marks joined IAA Trust
Company in 1993 and manages the equity portion of the Asset Allocation
Fund, and the international Common Trust Funds and a number of trust
accounts.

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<PAGE>

TAX EXEMPT BOND FUND:

The annualized total returns for the Tax Exempt Bond Fund for the period ended
June 30, 1996 are as follows:

1 Year 5 Years 10 Years
------ ------- --------

% % %

These returns assume all dividends and capital gains distributions were
reinvested and the maximum sales charge applied on initial investments. Although
the Fund's income is generally exempt from Federal income taxes, it may, under
certain circumstances, be subject to state income taxation. See "INCOME
DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS, AND TAXES".

29
<PAGE>

Mary S. Guinane, Investment Officer for the Tax Exempt Bond Fund: Earned a
M.B.A. at Illinois State University and a B.A. in Psychology and Sociology
at St. Ambrose College. Ms. Guinane has been with IAA Trust Company since
1981.

Note: The IAA Trust Tax Exempt Bond Fund's portfolio does not mirror the
composition of the Lehman Index.

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TAXABLE FIXED INCOME SERIES FUND:

MONEY MARKET SERIES:

Robert L. Sammer, BS manages the IAA Money Market Fund. Bob received his
bachelor of science degree in finance from Illinois State University in
1988 and is currently pursuing his MBA from the same institution. After
working as a trust administrator for Independent Trust Corporation in
Lombard, Illinois, he joined IAA Trust Company in 1991. Here, he has served
as client services coordinator, corporate retirement and agency accounts
coordinator and, now investment analyst.

SHORT-TERM GOVERNMENT BOND SERIES:

LONG-TERM BOND SERIES:

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Fund/Plan Services, Inc.

Fund/Plan Services, Inc. ("FPS"), #2 West Elm Street, Conshohocken, Pennsylvania
19428, is the Funds' Transfer and Dividend Disbursing Agent and as such performs
all shareholder services for the Funds. Effective November 1, 1996, the Transfer
and Dividend Disbursing Agent will have the new name of FPS Services, Inc. and
will have the new address of 3200 Horizon Drive, P.O. Box 61503, King of
Prussia, PA 19406-0903 The Funds have also entered into Agreements with FPS
under which FPS provides accounting and administration services.

Administration services include all administrative services except those
relating to the investment portfolios of the Funds, the distribution of the
Funds, and the maintenance of the Funds' financial records. The fees for
administrative services are based on a declining percentage of each Fund's
average net assets, beginning at .0015% of the first $50,000,000 of average net
assets. However, the Asset Allocation Fund, the Tax Exempt Bond Fund, and the
Taxable Fixed Income Series Fund are each required to pay a minimum annual fee
of $10,000 and the Growth Fund is required to pay a minimum annual fee of
$50,000 for such services.

The Funds each pay a minimum accounting fee of $25,000 and pay additional
accounting fees, based on declining percentages of their respective average net
assets in excess of $10,000,000. There are no direct or indirect relationships
between Fund/Plan Services, Inc. and the Funds or IAA Trust Company.

DISTRIBUTION OF THE FUNDS' SHARES

Fund/Plan Broker Services, Inc. ("FPBS") serves as the Distributor for the Funds
on a best efforts basis, pursuant to various Underwriting Agreements dated
____________________. The Distributor is an affiliated company of Fund/Plan
Services, Inc. ("FPS"), the Funds' servicing agent, inasmuch as both the
Distributor and FPS are under common ownership.

DISTRIBUTION PLANS

The shareholders of the Growth Fund, the Asset Allocation Fund, the Tax Exempt
Bond Fund, the Short-Term Government Bond Series and the Long-Term Bond Series
have each adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1
under the Investment Company Act of 1940. The Money Market Series does not
participate in any plan pursuant to this Rule. The Plan permits the
participating Funds to pay certain expenses associated with the distribution of
their shares. The Plan provides that the participating Funds will reimburse the
Distributor for actual distribution and shareholder servicing expenses incurred
by the Distributor not exceeding, on an annual basis, 0.25% of each
participating Fund's average daily net assets. Amounts expended by the
Distributor, but not reimbursed by each participating Fund's Plan, will not be a
continuing liability of such Fund in subsequent years. Because the Funds
reimburse the Distributor only for actual expenditures, the Distributor realizes
no profit from the 12b-1 Plan. The Plan may be terminated at any time and the
Funds shall have no liability for expenses that were not reimbursed as of the
date of termination.

All such payments made pursuant to the Plan shall be made for the purpose of
promoting the sale of shares or other such distribution-related expenses,
including any distribution or service fees paid to securities dealers,
investment advisers, financial planners, and others, who have executed a
distribution agreement with the Distributor. The maximum amount which will be
paid to such parties by the Distributor is 0.25% (on an annual basis) of a
participating Fund's average net assets, owned by client of that party.
Management may choose to pay a lesser amount.

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<PAGE>

CAPITAL STOCK

There are no conversion or preemptive rights in connection with any shares of
the Funds, nor are there cumulative voting rights with respect to the shares of
any of the Funds. Each of the Fund's shares has equal voting rights. Each issued
and outstanding share of each Fund is entitled to participate equally in
dividends and distributions declared by such Fund and in net assets of such Fund
upon liquidation or dissolution remaining after satisfaction of outstanding
liabilities.

All issued and outstanding shares of each Fund will be fully paid and
nonassessable and will be redeemable at the net asset value per share. The
interests of shareholders in the Funds will not, unless specifically requested
in writing by a shareholder, be evidenced by a certificate or certificates
representing shares of a Fund.

The authorized capitalizations of the Growth Fund, the Asset Allocation Fund,
and the Tax Exempt Bond Fund consist of 10,000,000 shares for each of these
Funds, each Fund having a par value of $1.00 per share.

The authorized capitalization of the Taxable Fixed Income Series Fund consists
of 250,000,000 shares of the par value of $0.10 per share. 100,000,000 of this
Fund's shares are designated as Money Market Series, 50,000,000 of its shares
are designated as Short-Term Government Bond Series, and 25,000,000 of its
shares are designated as Long-Term Bond Series. The remaining 75,000,000 shares
are undesignated.

Country Life Insurance Company

As of ____________, __________ shares or ____% of the issued and outstanding
capital stock of the Growth Fund were owned by Country Life Insurance Company
("Country Life"), Bloomington, Illinois. Country Life's capital stock enables it
to influence the outcome of shareholder votes. Country Life is organized in
Illinois. Substantially all issued and outstanding stock of Country Life is
owned by Illinois Agricultural Holding Co.

As of ____________, ___________ shares or ____% of the issued and outstanding
capital stock of the Asset Allocation Fund were owned by Country Life Insurance
Company ("Country Life"), Bloomington, Illinois. Country Life's capital stock
enables it to strongly influence the outcome of shareholder votes. Country Life
is organized in Illinois. Substantially all issued and outstanding stock of
Country Life is owned by Illinois Agricultural Holding Co.

Country Mutual Insurance Company

As of ______________, __________ shares or ____% of the issued and outstanding
capital stock of the Tax Exempt Bond Fund were owned by Country Mutual Insurance
Company ("Country Mutual"), Bloomington, Illinois. Such shares were purchased at
net asset value for the purpose of providing the initial capital of the Fund.
Country Mutual's capital stock enables it to influence the outcome of
shareholder votes. Country Mutual is organized in Illinois and proxy control of
the company is in Illinois Agricultural Association.

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<PAGE>

IAA Trust Company

As of October 1, 1996, IAA Trust Company owned of record ____________ shares or
_________% of the issued and outstanding capital stock of the Growth Fund,
__________ shares or ________% of the issued and outstanding capital stock of
the Asset Allocation Fund, ____________ shares or ________% of the issued and
outstanding capital stock of the Money Market Series,____________ shares or
________% of the issued and outstanding capital stock of the Short-Term
Government Bond Series ____________ shares or ________% of the issued and
outstanding capital stock of the Long-Term Bond Series.

Illinois Agricultural Holding Co. owns 100% of the outstanding voting securities
of the Trust Company. For additional information on the ownership of Illinois
Agricultural Holding Co. See "MANAGEMENT OF THE FUNDS".

Shareholder inquiries should be directed to Fund/Plan Services, Inc., P.O. Box
874, Conshohocken, Pennsylvania 19428, or call toll-free 1 (800) 245-2100.

INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS, AND TAXES

Dividends and capital gains distributions may be automatically reinvested in
additional shares of a particular Fund at net asset value without sales charge,
or paid in cash, at the choice of the investor. The cash option is not available
under the Systematic Withdrawal Plan or Retirement Plans.

Capital gains are taxed at the same rate as ordinary income. The dividends
received deduction for corporations is 70% and is applicable to the Growth Fund
and the Asset Allocation Fund. Each shareholder will receive a summary of the
dividends paid or reinvested as they are declared. If the entire amount in an
account is redeemed at any time during a month, dividends credited to that
account from the beginning of the month through the day of redemption will be
paid together with the proceeds of the redemption.

GROWTH FUND:

It is the policy of the Growth Fund to distribute semi-annually, all of its net
investment income and, if any, all of its net realized capital gains according
to tax regulations. Currently, these distributions are made at the end of the
Fund's fiscal year and at calendar year-end.

ASSET ALLOCATION FUND:

It is the policy of the Asset Allocation Fund to pay monthly dividends from its
net investment income and to distribute net capital gains, if any, according to
tax regulations at the end of its fiscal and calendar years.

TAX EXEMPT BOND FUND,
SHORT-TERM GOVERNMENT BOND SERIES and
LONG-TERM BOND SERIES:

It is the policy of the Fund and the Series to pay monthly dividends from their
net investment income.

The Fund and the Series intend to qualify each fiscal year (under the Internal
Revenue Code of 1986 and any amendments thereto) to pay "exempt-interest
dividends" to their shareholders. Exempt-interest dividends which are derived
from net income earned by the Trust on tax-exempt bonds will be excludable from
gross income of the shareholders for Federal income tax purposes. That part of
monthly net investment income which may be earned by the Fund and the Series
from certain taxable temporary investments, together with any annual
distributions

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<PAGE>

attributable to short-term capital gains, are taxable as ordinary income to
investors whether received in cash or reinvested in shares. The percentage of
each monthly dividend designated by the Fund or the Series as tax exempt will be
the same percentage as the actual tax exempt income earned during the period
covered by the distribution bears to total income earned by the Fund or the
Series during the period. Shareholders will be notified of such designations
monthly and information regarding the tax status of any other distributions will
be mailed annually. The percentage of the monthly dividend which is tax exempt
may vary from distribution to distribution. Long-term capital gains
distributions are taxable to shareholders as long-term capital gain, regardless
of how long a shareholder has held shares.

Shareholders of the Fund and the Series should recognize that should they redeem
shares between dividend dates, a portion of the per share redemption price may
represent interest accrued on municipal bonds and said portion may be taxed at
long- or short-term capital gains rates and not as a tax-exempt dividend
excludable from gross income.

Interest on indebtedness incurred by shareholders to purchase or carry shares of
the Fund and the Series will not be deductible for Federal income tax purposes.
The exemption of interest income for Federal income tax purposes does not
necessarily result in exemption under the income or other tax laws of any state
or local authority. Thus, shareholders may be subject to state and local taxes
on distributions of tax-exempt interest income from the Fund and the Series.

MONEY MARKET SERIES:

The Money Market Series declares and pays dividends of all of its daily net
investment income on each day that its net asset value is determined.

Net investment income, for dividend purposes of this Series, consists of: (1)
accrued interest income plus or minus amortized purchase discount or premium;
(2) plus or minus all short-term realized gains and losses and unrealized
appreciation and depreciation on portfolio assets; and (3) minus all accrued
expenses of such Series, which are accrued each day. Net income will be
calculated immediately prior to the determination of the net asset value per
share of the Series Since the net income of the Series (including realized gains
and losses and unrealized appreciation and depreciation on the portfolio
securities) is declared as a dividend each time the net income of the Series is
determined, the net asset value per share of the Series normally remains at
$1.00 per share immediately after each such determination and dividend
declaration. Any increase in the value of a shareholder's investment in the
Series representing the reinvestment of dividend income is reflected by an
increase in the number of shares of the Series in the account. Normally, the
Series will have a positive net income at the time of each determination
thereof. Net income may be negative if an unexpected liability must be accrued,
a loss realized, or unrealized depreciation occurs. If the net income of the
Series determined at any time is a negative amount, the net asset value per
share will be reduced below $1.00. The Series may endeavor to restore the net
asset value per share to $1.00 by not declaring dividends from net income on
subsequent days until restoration, with the result that the net asset value per
share will increase to the extent of positive net income which is not declared.

ALL FUNDS:

The Board of Directors may revise the above dividend policies, or postpone the
payment of dividends, if a Fund should have or anticipate any large presently
unexpected expense, loss, or fluctuation in net assets which in the opinion of
the Board might have a significant adverse effect on shareholders.

All of the Funds comply with Subchapter M of the Internal Revenue Code available
to investment companies and therefore, maintain exemption from Federal income
tax.

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<PAGE>

Long-term capital gains distributions are taxable to shareholders as long-term
capital gain, regardless of how long a person has been a shareholder. Any
dividend or distribution received shortly after the purchase of shares reduces
the net asset value of the shares by the amount of the dividend or distribution
and, although in effect a return of capital, is subject to income taxes. The
Funds are required to withhold and remit to the U.S. Treasury a portion (31%) of
dividend income, capital gains distributions, and redemption proceeds for any
account which provides an incorrect taxpayer identification number, no number at
all, or no certified number for a new account.

In order to avoid an excise tax on undistributed amounts, the Funds must declare
by the end of the calendar year a dividend representing 98% of their ordinary
income for the calendar year and 98% of their net capital gains (both long-term
and short-term) for the period of November 1 of the previous year through
October 31 of the current year. Such dividends will be paid on the last business
day of the calendar year to shareholders of record at the close of business on
the preceding business day.

Statements as to the tax status of distributions to shareholders will be mailed
annually. If shareholders are not subject to Federal income taxes on their
income, then they are not required to pay Federal tax on amounts distributed to
them. This section is not intended to be a complete discussion of all aspects of
the Federal income tax law and its effect on shareholders. For other tax
information, you may wish to consult your tax adviser.

PURCHASE OF SHARES

You may open an account by contacting Fund/Plan Broker Services, Inc. ("FPBS"),
P.O. Box 874, Conshohocken, Pennsylvania 19428, 1(800)245-2100 or your local
Country Capital Management Company sales representative. Purchases of Fund
shares may be made in two ways: by mail or by wire transfer, as discussed
further below. The minimum initial investment is $1,000 for all Funds. The
minimum subsequent investment amount is $100 for all Funds. After an account has
been opened, you may purchase additional shares through a sales representative
or you may send your order directly to IAA Trust Company c/o Fund/Plan Broker
Services Inc. ("FPBS"), P.O. Box 874, Conshohocken, Pennsylvania 19428. Each
check should be made payable to a specific Fund. All orders are subject to
acceptance by FPBS and without in any way limiting the foregoing, the Funds
(through FPBS) reserve the right to refuse any purchase which would result in
ownership by any shareholder of 5% or more of a Fund's outstanding shares at
that time. The Funds will automatically redeem shares if a purchase check is
returned for non-sufficient funds (NSF). This procedure places the risk for loss
on the shareholder. The Funds reserve the right to automatically redeem shares
if the share balance of an account falls below $1,000.

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<PAGE>

Purchase Price

Shares of all Funds and Series are sold at the net asset value (without a sales
charge) next determined after receipt of the order by FPBS.

Purchases by Mail

To open an account and purchase shares by mail, complete an application and mail
it with your check payable to "IAA Trust ___________________ Fund or Series",
c/o Fund/Plan Services, Inc., P.O. Box 874, Conshohocken, Pennsylvania 19428.
Applications may be obtained by calling toll-free, 1 (800) 245-2100.

The application need not be signed by a sales representative if you prefer to
purchase directly with Country Capital Management Company or FPBS. If you deal
with a sales representative, he or she will assist you in completing the
application, answer any of your questions, and mail the application for you.
Although no commission is paid, the sales representative may, at times, receive
additional compensation.

In order to maximize current income, all investments in the Funds must be made
in Federal Funds so that the Fund can put the money to work immediately. Checks
drawn on a member bank of the Federal Reserve System usually are converted into
Federal Funds within two business days of receipt by FPBS. Shares begin earning
income dividends on the day the purchase order is effective. A Fund will
automatically redeem shares if the purchase check is returned for non-sufficient
funds (NSF). This procedure places the risk for loss on the shareholder.

Purchases by Wire Transfer

To open an account and become a shareholder on the same day, first you (or our
sales representative) must telephone FPBS toll-free at 1 (800) 245-2100, by
12:00 Noon Eastern Time. An account number will be assigned to you for use in
identifying your wire transfer of money.

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<PAGE>

Second, you must request your bank to transmit immediately available funds
(Federal Funds) by wire to:

UNITED MISSOURI BANK, NA
ABA #10-10-00695
For: Fund/Plan Services, Inc.
Account #98-7037-071-9

IAA TRUST ________________ FUND/SERIES

Account of (exact name(s) of Account Registration)
Shareholder Account #_______________

In order to obtain same-day investment, your wire must be received by the above
bank by 12:00 Noon Eastern Time. The bank that wires your money may charge a fee
for this service.

Third, you or our sales representative must mail a completed application to
FPBS, as noted above.

Subsequent Investments

Once your account has been established, additional investments in any of the
Funds may be made at any time by mailing a check or by wiring money as described
above. When you wire money for either the initial or additional investments,
always call FPBS on the same day to notify them of the investment. The minimum
subsequent investments are $100 by mail and $1,000 by wire transfer.

SPECIAL PLANS AND OTHER PURCHASE INFORMATION

The Funds have available the following special Plans and purchase options.
Further information with respect to these plans is contained in the Funds'
Statement of Additional Information. Further information on these Plans may also
be obtained by contacting FPBS or Country Capital Management Company.

Automatic Investing

A shareholder may authorize Systematic Investing through automatic withdrawals
from his/her bank account(s).

Exchange Privileges

Shareholders in any of the Funds may exchange shares of their respective Fund
for shares of the other Funds on the basis of the relative net asset values per
share at the time of the exchange.

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<PAGE>

If the exchange is made by telephone, the new shares will be registered in the
same manner as the shares for which they were exchanged. A capital gain or loss
for Federal income tax purposes will be realized upon the exchange depending
upon the cost or other basis of the shares redeemed. Sixty days written notice
will be given to shareholders before any modifications to this privilege are
implemented.

Retirement Plans

IAA Trust Company ("IAATC") sponsors a prototype Defined Contribution Plan which
has been approved by the Internal Revenue Service and which meets the
requirements of the Tax Reform Act of 1986, as amended. This Plan can invest in
shares of the Growth Fund, the Asset Allocation Fund, and the Taxable Fixed
Income Series Fund. The minimum initial investment for each Fund is $100, with
no minimum for subsequent investments.

For individuals eligible to establish an Individual Retirement Account ("IRA"),
IAATC sponsors a prototype IRA Plan which has been approved by the Internal
Revenue Service.

Systematic Withdrawal Plan

Shareholders who purchase or already own $5,000 or more of a Fund's shares,
valued at the current public offering price, and who wish to receive periodic
payments may establish a Systematic Withdrawal Plan. Such plan holders will
receive monthly, quarterly or annual checks in the amount they designate.

VALUATION OF SHARES

The Funds will be open for business and will price their respective shares on
each day the New York Stock Exchange is open for trading. The Funds' share
prices will be determined at the close of regular trading hours of the New York
Stock Exchange, normally 4:00 p.m. Eastern Time. The Money Market Series
reserves the right to calculate its net asset value more frequently than once a
day if deemed desirable.

The net asset value per share is determined as follows. Securities listed or
admitted to trading privileges on any national securities exchange will be
valued at the last sales price on that day before the time for valuation, or, if
there is no sale before that time that day, the last bid price on such exchange
before that time that day. Equity securities which are traded in the
over-the-counter market only and which are included in the NASDAQ National
Market System will be valued at the last sales price preceding the time for
valuation. Equity securities which are traded in the over-the-counter market
only, but which are not included in the NASDAQ National Market System will be
valued at the mean between the last preceding bid and asked price. Valuations
may also be obtained from a pricing services when such prices are believed to
reflect the fair market value. Securities with a remaining maturity of sixty
days or less are valued at amortized cost, which approximates market value.
Short-term notes are valued at cost. Corporate bonds, municipal bonds,
receivables and portfolio securities not currently quoted as indicated above,
and other assets will be valued at fair value as determined in good faith by the
Board of Directors.

From the gross value of the assets so determined, there will be deducted all
liabilities, including accrued expenses and taxes, and any necessary reserves.
The remainder will be the net asset value of a Fund, which will be divided by
the number of shares of capital stock outstanding in order to determine the
Fund's net asset value per share. (The net asset value per share of the Money
Market Series is ordinarily $1.00.) On any day when depreciation in

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<PAGE>

the value of a Fund's portfolio securities exceeds income after expenses, such
Fund's net asset value per share may decline.

The market values of debt securities usually reflect yields generally available
on securities of similar quality. When yields decline, the market value of a
portfolio holding higher-yielding securities increases; and when yields
increase, the market value of the portfolio invested at lower yields can be
expected to decline. In addition, if a Fund has net redemptions at a time when
interest rates have increased, such Fund may have to sell portfolio securities
prior to maturity at a price below the Fund's carrying value. Also, because at
least a portion of the portfolio may be valued at amortized cost rather than
market, any yield quoted may be different if the entire portfolio were valued at
market, since amortized cost does not take market fluctuation into
consideration.

With respect to the Money Market Series, the value of all of its securities is
determined by using the amortized cost method of valuation, pursuant to Rule
2a-7 under the Investment Company Act. The amortized cost method of valuation
involves valuing a security at its cost at the time of purchase and thereafter
assuming a constant amortization to maturity of any discount or premium,
regardless of the impact of fluctuating interest rates on the market value of
such security. While this method provides certainty in valuation, it may result
in periods during which value, as determined by amortized cost, is higher or
lower than the price the Series would receive if it sold the instrument. The
purpose of this method of calculation is to attempt to maintain a constant net
asset value per share of $1.00, which may or may not result.

REDEMPTION OF SHARES

Each Fund will redeem any part or all of your shares whenever you request. The
price you receive will be the net asset value per share as next computed after
your request is received by Fund/Plan Services, Inc. ("FPS"), as Transfer Agent,
in proper form. Accounts in the Money Market Series will earn daily dividends up
to the day before the date of redemption.

You can redeem shares from an account -- by mail or by telephone, and with
respect to the Money Market Series only, by writing a check.

Redemptions by Mail

To redeem by mail, simply send a letter to:

IAA Trust Funds
c/o Fund/Plan Services, Inc.
P.O. Box 874
Conshohocken, PA 19428

Your letter must specify the name of the Fund, your account number and either
the number of shares or the dollar amount to be redeemed. Your request must be
signed exactly as your account is registered. If your account is owned jointly,
both owners must sign. If a stock certificate has been issued, it must be
forwarded back (blank and unsigned) with your written request.

The Funds reserve the right to require additional documentation, or signature
guarantees on any redemptions in amounts over $25,000 in value or for the
redemption of corporate, partnership or fiduciary accounts, or for certain types
of transfer requests or account registration adjustments. Signatures must be
guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15
under the Securities Exchange Act of 1934. Eligible guarantor institutions
include banks, brokers, dealers, credit unions, national securities exchanges,
registered securities associations, clearing agencies, and savings associations.
A broker-dealer guaranteeing signatures must be a member of a clearing
corporation or maintain net capital of at least $100,000. Credit unions must be
authorized to

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<PAGE>

issue signature guarantees. Signature guarantees will be accepted from any
eligible guarantor institution which participates in a signature guarantee
program.

Redemptions by Telephone

If you completed the portion of the application so as to authorize redemptions
by telephone, you may redeem in this manner by calling toll-free 1 (800)
245-2100 before the close of business on any business day. Telephone redemptions
are not available if a joint owner is under age 14. When one of the joint
tenants is age 14 to 17, the adult tenant must authorize telephone redemptions.
All telephone conversations with FPS will be recorded. The proceeds will be sent
only to the financial institution you designate or to the address of record of
the account. The proceeds will normally be sent the next business day by mail
or, if you prefer and pay the expense, they will be wire transferred (minimum
$1,000). If wire transferred, the Fund(s) cannot be responsible for any delays
which may occur after a Fund has entered the proceeds in the Federal wire
systems. The financial institution you designate must be a bank, savings and
loan or credit union which is insured under The FDIC, as only these institutions
can send or receive Federal wire transfers. These instructions will remain in
effect until you cancel or change them by written request. No stock certificates
will be issued to or may be held by shareholders electing this privilege. The
Funds reserve the right to terminate or modify this privilege at any time upon
thirty days notice to shareholders. Shareholders recently purchasing shares by
check may not use the telephone redemption privilege under certain
circumstances.

Neither the Funds nor any of their service contractors will be liable for any
loss or expense in acting upon telephone instructions that are reasonably
believed to be genuine. In attempting to confirm that telephone instructions are
genuine, the Funds will use such procedures that are considered reasonable,
including requesting a shareholder to correctly state his or her Fund account
number, the name in which his or her account is registered, his or her social
security number, banking institution, bank account number, and the name in which
his or her bank account is registered. To the extent that a Fund fails to use
reasonable procedures to verify the genuineness of telephone instructions, it
and/or its service contractors may be liable for any such instructions that
prove to be fraudulent or unauthorized.

Redemptions by Writing a Check

If you so request on the application, the Money Market Series only will provide
you with an initial supply of checks, which you should receive within two or
three weeks. These checks may be written in any amount not less than $100 nor
more than $100,000, and can be made payable to you or anyone you desire.
Redemption procedures will enable you to continue to earn daily income dividends
until your redemption check has cleared. Payment of all redemption checks is
subject to approval by the Fund, and if there are not sufficient shares in your
account, the check will be returned marked "Insufficient Funds". The Fund
reserves the right to terminate or modify this privilege at any time upon thirty
days notice to shareholders. Shareholders purchasing shares by check may not use
the check redemption privilege under certain circumstances.

Check-Writing Privilege Terms: Persons electing check-writing automatically
authorize the bank to honor checks drawn by them on the bank and appoint FPS,
the Fund's Transfer Agent, as their agent to redeem a sufficient number of Money
Market Series shares to pay such checks. They also automatically agree: (1) The
owner or owners who signs the check will sign their name exactly as it appears
in Item 1 on the application or the check will not be honored; (2) This
privilege is subject to the Fund's and the bank's rules and regulations and
applicable Government regulations as amended from time to time; (3) The bank may
refuse to honor checks and the Fund may refuse to effect redemptions to pay
checks whenever the right of redemption has been suspended or postponed; (4) To
examine confirmations and to notify the Fund, within thirty days after mailing
to the owner(s), of any error in the confirmations and that failure to do so
shall preclude any claim against the Fund, the Distributor, the bank, FPS, and
each of their representatives and agents by reason of such failure; (5) This
privilege may be modified or terminated by any owner by serving written notice
to the Fund, and the Fund may modify or terminate it by serving

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<PAGE>

written notice to the owner(s) thirty days in advance thereof. This feature is
not available if a part owner is under age 14. When one of its joint tenants is
age 14 to 17, both tenants must sign drafts.

Redemption Payments to Shareholders

If a partial redemption is being made and the shareholder is using "specific
identification" accounting in determining his/her gain or loss for tax purposes,
it is important that he/she indicate which shares are to be redeemed, giving the
date acquired and number of shares. If several purchases are involved and the
shareholder desires a check for a stated amount, the order in which shares are
to be redeemed should also be specified. If no such instructions are given, the
shareholder will be required to compute his/her tax on a "first in - first out"
basis. No designation of purchase dates is necessary in connection with a
redemption of all shares. The sale date and proceeds of redemptions (unless
exempt) will be reported by the Funds to the Internal Revenue Service at the end
of each year, as required by law.

Redemption of shares may be made from any available assets of each Fund, and if
a Fund does not have sufficient cash on hand, such Fund will normally sell
portfolio securities to effect such redemption.

Payment to shareholders for shares surrendered for redemption is made in cash as
soon as practicable after surrender, within seven days, except: (1) for any
period (a) during which the New York Stock Exchange is closed other than
customary weekend and holiday closing, or (b) during which trading on the New
York Stock Exchange is restricted; (2) for any period during which an emergency
exists as determined by the Securities and Exchange Commission as a result of
which (a) disposal by a Fund of securities owned by it is not reasonably
practicable, or (b) it is not reasonably practicable for a Fund to determine the
value of its net assets; or (3) for such other periods as the Securities and
Exchange Commission may by order permit for the protection of security holders
of the Funds. In such event, the day will not be regarded as a business day, the
Funds' share prices will not be calculated, and all orders will be held for
execution on the following business day. The Funds, however, will not mail
redemption proceeds until they have assured themselves that checks received for
the purchase of any shares being redeemed have, or will be, cleared.
Accordingly, redemption checks may not be mailed until the shares being redeemed
have been on a Fund's books for at least fifteen business days measured from the
date shown on the purchase confirmation, although the effective date of the
redemption will be the date the redemption request is received by the particular
Fund. Payment for redeemed shares may be made in whole or in part in portfolio
securities of a Fund, at the portfolio value on the day the proper redemption
request is received, if the Board of Directors determines that the liquidation
of securities is impracticable or that payment in cash would prejudice the best
interests of the remaining shareholders.

The Funds have elected to be governed by Rule 18f-1 under the Investment Company
Act of 1940, pursuant to which the Funds are obligated to redeem shares solely
in cash, up to the lesser of $250,000 or one percent of the net asset value of
the particular Fund during any 90-day period for any one shareholder. The one
percent net asset value of each Fund shall be computed at the beginning of such
90-day period. In the event of a redemption in kind, it should be noted that a
shareholder would incur brokerage costs if he sold the securities received.

The value of the shares on redemption may be more or less than the shareholder's
cost, depending upon the market value of the portfolio securities at the time of
redemption. Shares redeemed will be canceled. Each Fund has the right to
establish a withdrawal charge on redemption of its shares, but the Funds do not
make any such charge and have no present intention of making such a charge, and
in the event such a withdrawal charge is established, at least thirty days prior
notice will be given to shareholders.

42
<PAGE>

IAA Trust Mutual Funds:
IAA Trust Growth Fund, Inc.
IAA Trust Asset Allocation Fund, Inc.
IAA Trust Tax Exempt Bond Fund, Inc.

IAA Trust Taxable Fixed Income Series Fund, Inc.
IAA Trust Money Market Series
IAA Trust Short-Term Government Bond Series
IAA Trust Long-Term Bond Series

Board of Directors:
Ronald R. Warfield
Herbert G. Allen

Charlot R. Cole

Nancy J. Erickson

William E. Klein, Sr.
Ailene Miller

Rollie D. Moore

Officers:
Ronald R. Warfield, President
Wayne A. Brown, Vice President
Gary E. Mede, Vice President
Richard M. Miller, Vice President
Rollie D. Moore, Vice President
Paul M. Harmon, Secretary
Robert W. Weldon, Treasurer
Richard F. Day, Controller

Investment Adviser:
IAA Trust Company
Bloomington, Illinois

Distributor:
Fund/Plan Broker Services, Inc.
Conshohocken, Pennsylvania

Transfer Agent:
Fund/Plan Services, Inc.
Conshohocken, Pennsylvania

Custodian:
IAA Trust Company
Bloomington, Illinois

Independent Accountants:
Coopers & Lybrand L.L.P.
Philadelphia, Pennsylvania

F30-117-04

<PAGE>

STATEMENT OF ADDITIONAL INFORMATION

October 28, 1996

IAA TRUST GROWTH FUND, INC.
IAA TRUST ASSET ALLOCATION FUND, INC.
IAA TRUST TAX EXEMPT BOND FUND, INC.

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

808 IAA Drive, Bloomington, Illinois 61702, Phone (309) 557-3222

The IAA Trust Mutual Funds consist of four separate funds (collectively, the
"Funds"): IAA Trust Growth Fund, Inc. (the "Growth Fund"); IAA Trust Asset
Allocation Fund, Inc. (the "Asset Allocation Fund"); IAA Trust Tax Exempt Bond
Fund, Inc. (the "Tax Exempt Bond Fund"); and IAA Trust Taxable Fixed Income
Series Fund, Inc. (the "Taxable Fixed Income Series Fund") which currently
consists of three series: IAA Trust Money Market Series (the "Money Market
Series"); IAA Trust Short-Term Government Bond Series (the "Short-Term
Government Bond Series"); and IAA Trust Long-Term Bond Series (the "Long-Term
Bond Series"). This Statement of Additional Information is not a prospectus, but
should be read in conjunction with the Funds' Prospectus dated October 28, 1996.

A copy of the Funds' Prospectus may be obtained from a local Country Capital
Management Company salesperson who is also a Country Companies agent, a licensed
salesperson at IAA Trust Company, 808 IAA Drive, Bloomington, Illinois 61702, by
writing the Funds' principal Underwriter, Fund/Plan Broker Services, Inc., #2
Elm Street, P.O. Box 874, Conshohocken, Pennsylvania 19428, or by calling
toll-free 1 (800) 245-2100. Effective November 1, 1996, the Underwriter will
have the new name of FPS Broker Services, Inc. and will have the new address of
3200 Horizon Drive, P.O. Box 61503, King of Prussia, PA 19406-0903.

TABLE OF CONTENTS

SUBJECT PAGE

Investment Objectives and Policies.....................................
Policies and Investment Restrictions Aimed at Protecting Investors.....
Directors and Officers of the Funds....................................
Control Persons and Principal Holders of Securities....................
Investment Advisory and Other Services.................................
Brokerage..............................................................
Purchases, Redemptions, and Pricing of Fund Securities.................
Rights of Accumulation............................................
Exchange Privileges...............................................
One-Time Reinvestment Privilege Without Sales Charge..............
Retirement Plans..................................................
Automatic Investing...............................................
Systematic Withdrawal Plan........................................
Underwriter Compensation...............................................
Investment Performance Information.....................................
Financial Statements -- Annual Reports to Shareholders.................
Report of Independent Accountants......................................
Appendix...............................................................

<PAGE>

INVESTMENT OBJECTIVES AND POLICIES

For information with respect to the Funds' individual investment objectives and
policies, see "Investment Objectives and Policies" in the Funds' Prospectus,
and "Policies and Investment Restrictions Aimed at Protecting Investors" in this
Statement of Additional Information.

For the fiscal years ended June 30, 1995 and 1996, the Growth Fund's portfolio
turnover rate was 31.84% and ____%, respectively. This Fund does not expect that
its turnover rate as of June 30, 1997 will vary significantly from that at June
30, 1996.

For the fiscal years ended June 30, 1995, and 1996, the Asset Allocation Fund's
portfolio turnover rate was 21.03% and ____%, respectively. This Fund does not
expect that its turnover rate as of June 30, 1997 will vary significantly from
that at June 30, 1996.

For the fiscal years ended June 30, 1995 and 1996, the Tax Exempt Bond Fund's
portfolio turnover rate was 24.89% and ____%, respectively. This Fund does not
expect that its turnover rate as of June 30, 1997 will vary significantly from
that at June 30, 1996.

POLICIES AND INVESTMENT RESTRICTIONS AIMED AT PROTECTING INVESTORS

Fundamental Investment Restrictions

The following investment restrictions are considered fundamental policies and
may be changed only by the vote of a majority of a Fund's outstanding shares,
which as used herein and in the Prospectus means the lesser of (1) 67% of such
Fund's outstanding shares present at a meeting if the holders of more than 50%
of the outstanding shares are present in person or by proxy, or (2) more than
50% of such Fund's outstanding shares.

Restrictions Applicable to All Funds:

o All Funds will not authorize or issue any class of senior securities.

o The Growth Fund, the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Short-Term Government Bond Series and the Long-Term Bond Series will not
borrow money, except as a temporary measure for extraordinary or emergency
purposes, and then only from a bank in an amount not to exceed 10% of the
value of the Fund's total assets, nor 5% of the value of such Fund's total
assets if such debt matures more than sixty days after issuance.

The Money Market Series will not borrow money, except as a temporary measure
for extraordinary or emergency purposes, and then only from a bank in an
amount not to exceed 10% of the value of the Fund's total assets and will
not purchase securities at any time a loan to such Fund is outstanding
(investments in repurchase agreements are not subject to these
restrictions).

o All Funds will not underwrite or participate in the underwriting of
securities of other issuers.

o All Funds will not purchase or sell real estate, commodities, or commodity
contracts.

o All Funds will not make loans, except through the purchase of publicly
distributed debt securities in accordance with each Fund's investment
policies. Investments in repurchase agreements shall not be considered a
loan for purposes of this restriction. (See the Appendix for risk
disclosure statement on repurchase agreements).

<PAGE>

Restrictions Applicable to Certain Funds and Series:

The Growth Fund will not:

o Invest more than 5% of its assets in the securities of any one issuer.

o Purchase or hold as much as 10% of any class of outstanding equity
securities or as much as 10% of the outstanding voting securities of any
one issuer.

o Concentrate the investments of more than 25% of the total value of its
assets in any single industry.

The Asset Allocation Fund, the Short-Term Government Bond Series and the
Long-Term Bond Series will not:

o With respect to 75% of its assets, invest more than 5% of its assets in the
securities of any one issuer.

o Purchase or hold as much as 10% of any class of outstanding equity
securities or as much as 10% of the outstanding voting securities of any
one issuer.

o Concentrate the investments of more than 25% of the total value of its
assets in any single industry.

The Tax Exempt Bond Fund will not:

o With respect to 75% of its assets, invest more than 5% of its assets in the
securities of any one issuer. The term "issuer" as used by this Fund will
mean any one state municipality, agency, authority, instrumentality or
other entity which is directly responsible for the payment of debt service
on its outstanding obligations.

o With respect to non-municipal bond investments, will not concentrate
investments of more than 25% of the total value of its assets in any single
industry, except that there is no limitation with regard to investments in
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.

The Money Market Series will not:

o Invest more than 10% of its total assets in repurchase agreements maturing
in more than seven days or in non-negotiable certificates of deposit (See
the Appendix for risk disclosure statement on repurchase agreements).

o Invest more than 5% of its total assets in the securities of any one
issuer.

o Concentrate the investments of more than 25% of the total value of its
assets in any single industry, other than banks.

Non-fundamental Investment Restrictions

The following restrictions are imposed by the management of the Funds, and may
be modified by the Board of Directors of the Funds without shareholder approval.

All Funds will not:

o Invest in companies for purposes of exercising control or management.

o Buy from or sell portfolio securities to any of its Officers, Directors,
employees, Investment Advisers or Underwriters as principals.

<PAGE>

o Will not purchase securities on margin, effect a short sale of any
security, purchase or sell puts, calls, straddles or spreads, or
participate in any joint or joint and several trading accounts.

o Will not purchase or retain securities of any company if persons affiliated
with such Fund or its Investment Adviser, as a group, beneficially own more
than 1% of the securities of such a company.

o In any case, borrow money in an amount which exceeds 5% of the value of its
total assets and will not purchase securities at any time a loan to such
Fund is outstanding (investment in repurchase agreements will not be
considered to be loans for purposes of this restriction).

Investment Company Act Restrictions

The following restrictions are imposed by the Investment Company Act of 1940.

All Funds will not:

o Purchase or acquire securities of another investment company except by
purchase on the open market at regular brokerage rates (other than when
such purchase or acquisition is part of a plan of merger or consolidation)
if immediately after such purchase or acquisition, such Fund would own in
the aggregate: (1) more than 3% of the total outstanding voting stock of
such other investment company; (2) securities issued by such other
investment company having an aggregate value in excess of 5% of the value
of such Fund's total assets; or (3) securities issued by such other
investment company and all other investment companies having an aggregate
value in excess of 10% of the value of such Fund's total assets.

Any investment policy or restriction which involves a maximum percentage of
securities or assets shall not be considered to be violated unless an excess
over the percentage occurs immediately after an acquisition of securities and
results therefrom.

<TABLE>
<CAPTION>
DIRECTORS AND OFFICERS OF THE FUNDS

- -----------------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
Name, Age Position(s) Aggregate Total Principal Occupation(s) During Past Five Years
and Held with Compensation Compensation
Address Fund(s) From Funds for From Funds
Fiscal Year & Fund
Ended 6/30/96 Complex Paid
to Directors

- -----------------------------------------------------------------------------------------------------------------------------------

Ronald R. Director ______ ______ Director and President: Illinois Agricultural Association,
Warfield(2) since 1994 Agricultural Holding Co., CC Services, Inc.(4), Country Capital
(52) President Management Company, Country Casualty Insurance Company, Country
since 1994 Investors Life Assurance Company, Country Life Insurance Company,
Country Mutual Insurance Company, and Country Preferred Insurance
Company, 1993 to date; Director: AgriVisor Services, Inc., and
IAA Trust Company, 1993 to date; Coordinating Committee Member of
GROWMARK, Inc. and Chairman, Board of Trustees, IAA
Foundation(2), 1993 to date; Director and President: IAA Trust
Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA
Trust Tax Exempt Bond Fund, Inc., IAA Trust Taxable Fixed Income
Series Fund, Inc.(1), Illinois Agricultural Service Company, 1994
to date; Country Medical Plans, Inc., 1996 to date; President:
AgriVisor Services, Inc., and IAA Trust Company, 1994 to date;
Chairman of the Board: Country Capital Management Company, 1994
to date; Director: Bank of Gibson City, 1989 to date. Director:
American Farm Bureau Federation and certain of its affiliated
companies, 1995 to date. Farmer.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
Herbert G. Director ______ ______ Director: IAA Trust Growth Fund, Inc., IAA Trust Asset
Allen (66) since 1987 Allocation Fund, Inc., IAA Trust Tax Exempt Bond Fund, Inc.,
and IAA Trust Taxable Fixed Income Series Fund, Inc.(1),
1987 to date. Farmer.

- -----------------------------------------------------------------------------------------------------------------------------------

Nancy J. Director ______ ______ President of McHatton Farm Management, Inc., 1981 to date;
Erickson since 1995 Director: IAA Growth Fund, Inc., IAA Trust Asset Allocation
(39) Fund, Inc., IAA Trust Taxable Fixed Income Series Fund,
Inc.(1), and IAA Trust Tax Exempt Bond Fund, Inc., 1995 to
date. Farmer.

- -----------------------------------------------------------------------------------------------------------------------------------

William E. Director ______ ______ Director: Illinois Agricultural Association, Illinois
Klein, Sr.(2) since 1993 Agricultural Holding Co., CC Services, Inc.(4), Country
(68) Casualty Insurance Company, Country Investors Life Assurance
Company, Country Life Insurance Company, Country Mutual
Insurance Company, and Country Preferred Insurance Company,
1988 to date; Director: Country Capital Management Company,
1992 to date; Director: IAA Trust Growth Fund, Inc., IAA
Trust Asset Allocation Fund, Inc., IAA Trust Tax Exempt Bond
Fund Inc., and IAA Trust Taxable Fixed Income Series Fund,
Inc.(1), 1993 to date. Farmer.

- -----------------------------------------------------------------------------------------------------------------------------------

Ailene Director ______ ______ McLean County (Illinois) Board Member: 1986 to date; Member:
Miller since 1991 IAA Foundation(2), Trustee-Emeritus, 1988 to date; Director:
(70) IAA Trust Growth Fund, Inc., IAA Trust Asset Allocation
Fund, Inc., IAA Trust Tax Exempt Bond Fund, Inc., and IAA
Trust Taxable Fixed Income Series Fund, Inc.(1), 1991 to
date.

- -----------------------------------------------------------------------------------------------------------------------------------

Rollie D. Director ______ ______ Director and Vice President: Illinois Agricultural
Moore (47) since 1996 Association, Illinois Agricultural Holding Co., CC Services,
Inc.(4), Country Capital Management Company, Country
Casualty Insurance Company, Country Investors Life Assurance
Company, Country Life Insurance Company, Country Mutual
Insurance Company, and Country Preferred Insurance Company,
1993 to date; Director: IAA Trust Company, 1993 to date;
Vice Chairman, Board of Trustees, IAA Foundation(2), 1993 to
date; Vice President: IAA Trust Growth Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., IAA Trust Tax Exempt Bond Fund,
Inc., and IAA Trust Taxable Fixed Income Series Fund,
Inc.(1), 1994 to date; Vice President and Director: IAA
Trust Company, 1994 to date and Country Medical Plans, Inc.,
1996 to date; Director: AgriVisor Services, Inc. and
Illinois Agricultural Service Company, 1994 to date;
Coordinating Committee Member of GROWMARK, Inc., 1994 to
date. Farmer. Previously served as Director: Illinois
Agricultural Association, Illinois Agricultural Holding Co.,
CC Services, Inc.(4), Country Casualty Insurance Company,
Country Investors Life Assurance Company, Country Life
Insurance Company, Country Mutual Insurance Company, and
Country Preferred Insurance Company, 1984 to 1992; Country
Capital Management Company, 1989 to 1992; IAA Trust Growth
Fund, Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust
Taxable Fixed Income Series Fund, Inc.(1), and IAA Trust Tax
Exempt Bond Fund, Inc., 1989 to 1993; AgriVisor Services,
Inc., 1991 to 1992.

- -----------------------------------------------------------------------------------------------------------------------------------

Wayne A. Vice- ______ ______ Senior Vice President--Investments: IAA Trust Company, 1983
Brown (62) President to date; Assistant Vice President--Fixed Income Securities:
since 1994 IAA Trust Company, 1973 to 1983; Assistant Treasurer:
Country Life Insurance Company, 1980 to date; Vice
President: IAA Trust Growth Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., IAA Trust Tax Exempt Bond Fund, Inc.,
and IAA Trust Taxable Fixed Income Series Fund, Inc.(1),
1994 to date.

- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

5
<PAGE>

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C>
Gary E. Vice ______ ______ Executive Vice President: IAA Trust Company, 1977 to date;
Mede (59) President Vice President--Investments: Country Capital Management
since 1978 Company, 1977 to date; Vice President: IAA Trust Growth
Fund, Inc., IAA Trust Asset Allocation Fund, Inc., and IAA
Trust Tax Exempt Bond Fund, Inc., 1978 to date; IAA Trust
Taxable Fixed Income Series Fund, Inc.(1), 1981 to date.

- -----------------------------------------------------------------------------------------------------------------------------------

Richard M. Vice ______ ______ Senior Vice President and Senior Trust Officer: IAA Trust
Miller (68) President Company, 1991 to date (prior thereto Senior Vice President
since 1992 and Trust Officer); Vice President: IAA Trust Growth Fund,
Inc., IAA Trust Asset Allocation Fund, Inc., IAA Trust
Tax Exempt Bond Fund, Inc., and IAA Trust Taxable Fixed
Income Series Fund, Inc.(1), 1992 to date.

- -----------------------------------------------------------------------------------------------------------------------------------

Robert W. Treasurer ______ ______ Vice President--Finance and Treasurer: IAA Trust Company,
Weldon since 1975 Illinois Agricultural Association, Country Life Insurance
(62) Company, Country Mutual Insurance Company, Country Casualty
Insurance Company, Country Preferred Insurance Company, and
Country Capital Management Company, 1974 to date; Director
and Treasurer: Illinois Agricultural Service Company, 1974
to date; Vice President--Finance and Treasurer: CC Services,
Inc.(4), 1975 to date; Country Investors Life Assurance
Company, 1981 to date; Treasurer: Illinois Agricultural
Holding Co., 1974 to date; Illinois Agricultural Auditing
Association, 1975 to date; IAA Trust Growth Fund, Inc., 1975
to date; IAA Trust Asset Allocation Fund, Inc. and IAA Trust
Tax Exempt Bond Fund, Inc., 1978 to date; IAA Trust Taxable
Fixed Income Series Fund, Inc.(1), 1981 to date; AgriVisor
Services, Inc., 1984 to date.

- -----------------------------------------------------------------------------------------------------------------------------------

Richard F. Controller ______ ______ Controller: IAA Trust Company, 1974 to date; IAA Trust
Day (56) since 1992 Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc.,
IAA Trust Tax Exempt Bond Fund, Inc., and IAA Trust Taxable
Fixed Income Series Fund, Inc.(1), 1992 to date.

- -----------------------------------------------------------------------------------------------------------------------------------

Paul M. Secretary ______ ______ Deputy General Counsel: Illinois Agricultural Association
Harmon since 1995 and Affiliated Companies, 1991 to date. Secretary: Country
(54) Capital Management Company, IAA Trust Growth Fund, Inc.,
IAA Trust Asset Allocation Fund, Inc., IAA Trust Taxable
Fixed Income Series Fund, Inc.(1), IAA Trust Tax Exempt Bond
Fund, Inc., 1995 to date; and IAA Trust Company, 1996 to
date.

- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) IAA Trust Taxable Fixed Income Series Fund, Inc. was formerly IAA Trust
Money Market Fund, Inc.

(2) Interested Directors: all directors classified by the Funds as interested
directors also serve as directors of Illinois Agricultural Association
(IAA), Illinois Agricultural Holding Co. (IAHC), Country Life Insurance
Company, Country Mutual Insurance Company (CLIC). IAHC owns 99.9% of the
outstanding stock of CLIC and 100% of the outstanding stock of IAA Trust
Company (IAATC). Ronald R. Warfield and Rollie D. Moore also serve as
directors of IAATC and as president and vice president, respectively, of
CLIC, IAACT, IAHC and IAA. As of August 1, 1996, ___________ shares, or
______% of the issued and outstanding capital stock of the Fund were owned
of record by IAATC, 1701 Towanda Avenue, Bloomington, Illinois.

(3) The mailing address for all the Funds' officers and directors is in care of
the IAA Trust Funds, 808 IAA Drive, Bloomington, Illinois 61702.

<PAGE>

(4) CC Services, Inc. was organized to provide insurance brokerage,
administrative, marketing and other services to the insurance companies
affiliated with the Illinois Agricultural Association.

Directors of the Fund are entitled to payment ($200 for the Growth Fund,
$50 for each of the Asset Allocation, Tax Exempt Bond and Taxable Fixed Income
funds) for each day or a portion thereof spent in a meeting or meetings of the
Board of Directors or while engaged in special work authorized by the President
or the Board of Directors and to reimbursement of expenses for each directors'
meeting attended or while engaged in a special work authorized by the President
or by the Board of Directors, but no fees are paid to any director if such
director is also a director, officer or employee of the investment adviser of
the Fund. Directors and officers receive no other compensation from the Fund for
their services. During the fiscal year ended June 30, 1996, the aggregate amount
of fees and expenses paid to directors and officers was $_______.

The Board of Directors held four meetings during the Fund's fiscal year
ended June 30, 1996. All incumbent directors attended 75% or more of these
meetings, except for Nancy J. Erickson who attended 100% of the meetings
following her election to the Board.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

Country Life Insurance Company

As of October 1, 1996, Country Life Insurance Company ("Country Life")
owned _____ shares or _____ % of the outstanding shares of the Growth Fund,
_____shares or _____ % of the outstanding shares of the Asset Allocation
Fund, and _____ shares or _____ % of the outstanding shares of the Money
Market Series.

Substantially all of the issued and outstanding voting securities of
Country Life are owned by Illinois Agricultural Holding Co. and
approximately 98% of the outstanding voting securities of this latter
company are owned by Illinois Agricultural Association. Each of these
companies is incorporated in Illinois. Country Life's home office is at
1711 G.E. Road, Bloomington, Illinois. The home office address for both
Illinois Agricultural Holding Company and Illinois Agricultural Association
is 1701 Towanda Avenue, Bloomington, Illinois. For the effect of Country
Life's stock ownership in the Funds on other Fund shareholders, see the
section titled "CAPITAL STOCK" in the Funds' Prospectus.

Country Mutual Insurance Company

As of October 1, 1996 Country Mutual Insurance Company ("Country Mutual")
owned ______ shares or ______ % of the outstanding shares of the
Tax-Exempt Bond Fund.

Country Mutual has sole voting and investment power with respect to the
common stock which it owns in this Fund. Through proxies, voting control of
Country Mutual is in Illinois Agricultural Association. Each of these
companies is incorporated in Illinois with home office addresses at 1701
Towanda Avenue, Bloomington, Illinois. For the effect of Country Mutual's
stock ownership in the Fund on other Fund shareholders, see the section
titled "CAPITAL STOCK" in the Funds' Prospectus.

IAA Trust Company

As of October 1, 1996, IAA Trust Company owned of record _____ shares or
_____ % of the issued and outstanding capital stock of the Growth Fund,
_____ shares or _____ % of the issued and outstanding capital stock of the
Asset Allocation Fund, and _____ shares or _____ % of the issued and
outstanding capital stock of the Money Market Series, _____ shares or
_____ % of the outstanding shares of the Short-Term Government Bond Series,
and _____ shares or _____ % of the outstanding shares of the Long-Term Bond
Series.

<PAGE>

IAA Trust Company's address is 808 IAA Drive, Bloomington, Illinois. Illinois
Agricultural Holding Co. owns 100% of the outstanding voting securities of
the Trust Company.

Officers and Directors

As of October 1, 1996, the Officers and Directors of the Funds as a group
beneficially owned, directly or indirectly, less than 1% of the issued and
outstanding capital stock of any Fund.

INVESTMENT ADVISORY AND OTHER SERVICES

Controlling Shareholders

For the names of all controlling persons of IAA Trust Company, see section
titled " MANAGEMENT OF THE FUNDS" in the Funds' Prospectus.

Fund Officers Affiliated with Adviser

Fund Officers and Directors who are also Officers or Directors of IAA Trust
Company are set forth in the section titled " MANAGEMENT OF THE FUNDS" in the
Funds' Prospectus.

The Investment Adviser

IAA Trust Company, as Investment Adviser to the Funds, advises each Fund as
to: investing its capital; continually reviews its investment portfolio and
recommends changes that appear desirable; furnishes statistical and research
information, office space, facilities, and equipment required for each Fund;
and pays the compensation of Directors, Officers, and employees of the Funds
who are also Directors, Officers, and employees of IAA Trust Company. For
these services performed and expenses assumed, each Fund pays IAA Trust
Company the annual fees as shown below. Such fees are computed on a daily
basis and are paid monthly.

The Growth Fund pays approximately .75% of 1% in any fiscal year of its
average net assets. For the fiscal years ended June 30, 1994, 1995, and
1996, IAA Trust Company received $497,296, $476,164, and ________,
respectively, for its services as Investment Adviser to the Fund. Neither IAA
Trust Company nor any Company affiliated with it receives any brokerage
commissions from the Fund, as such business is transacted with non-affiliated
broker-dealers.

The Asset Allocation Fund pays approximately .75% of 1% in any fiscal year of
its average net assets. For the fiscal years ended June 30, 1994, 1995, and
1996, IAA Trust Company received $58,895, $67,275, and ________,
respectively, for its services as Investment Adviser to the Fund. Neither IAA
Trust Company nor any Company affiliated with it receives any brokerage
commissions from the Fund, as such business is transacted with non-affiliated
broker-dealers.

The Tax Exempt Bond Fund pays approximately .50% of 1% in any fiscal year of
its average net assets. For the fiscal years ended June 30, 1994, 1995, and
1996, IAA Trust Company received, $100,624, $93,589, and ________,
respectively, for its services as Investment Adviser to the Fund. Neither IAA
Trust Company nor any Company affiliated with it receives any brokerage
commissions from the Fund, as such business is transacted with non-affiliated
broker-dealers.

The Money Market Series pays approximately .50% of 1% in any fiscal year of
its average net assets. For the fiscal year ended June 30, 1994, IAA Trust
Company received $182,832 for investment advisory

8
<PAGE>

services, all of which was voluntarily waived. For the fiscal year ended
June 30, 1995, IAA Trust Company earned $178,518 for investment advisory
services and voluntarily agreed to waive fees totaling $86,900. For the
fiscal year ended June 30, 1996, IAA Trust Company earned $________ for
investment advisory services and voluntarily agreed to waive fees totaling
$_________. The Advisor is currently not waiving any of its investment
advisory fees. Neither IAA Trust Company nor any Company affiliated with it
receives any brokerage commissions from the Fund, as such business is
transacted with non-affiliated broker-dealers.

The Short-Term Government Bond Series pays approximately .50% of 1% in any
fiscal year of its average net assets. Neither IAA Trust Company nor any
Company affiliated with it receives any brokerage commissions from the Fund,
as such business is transacted with non-affiliated broker-dealers.

The Long-Term Bond Series pays approximately .75% of 1% in any fiscal year of
its average net assets. Neither IAA Trust Company nor any Company affiliated
with it receives any brokerage commissions from the Fund, as such business is
transacted with non-affiliated broker-dealers.

The Distributor

Fund/Plan Broker Services, Inc. ("FPBS") is the primary and exclusive
Distributor of the Funds' shares, pursuant to Underwriting Agreements with
each Fund. As Distributor, FPBS will use its best efforts to effect such
distributions, but it is required to take and pay for only such securities as
it sells to the public. Commissions for the sale of shares received by FPBS
do not represent compensation paid by the Funds to FPBS and are not expenses
of the Funds.

12b-1 Plan

The shareholders of the Growth Fund, the Asset Allocation Fund, the Tax
Exempt Bond Fund, the Short-Term Government Bond Series, and the Long-Term
Bond Series have adopted respective Plans of Distribution pursuant to Rule
12b-1 under the Investment Company Act of 1940. During the fiscal year ended
June 30, 1996, the Growth Fund paid ______ to FPBS from its Distribution
Plan. During the fiscal year ended June 30, 1996, the Asset Allocation Fund
paid ______ to FPBS from its Distribution Plan. During the fiscal year ended
June 30, 1996, the Tax Exempt Bond Fund paid ______ to FPBS from its
Distribution Plan. See "DISTRIBUTION PLANS" in the Funds' Prospectus.

The Transfer Agent

Fund/Plan Services, Inc. ("FPS") is the Funds' Transfer and Dividend
Disbursing Agent and as such performs all shareholder services for the Funds.
As part of these services, FPS will maintain records pertaining to the sale,
redemption, and transfer of Fund shares and will distribute each Fund's cash
dividends to shareholders. For such services, each Fund will pay FPS fees
which management believes are comparable to fees charged by others who
perform such transfer agency services.

The Growth Fund paid FPS, for the fiscal years ended June 30, 1994, 1995, and
1996, $83,386, $68,022, and ______, respectively. These fees were for
transfer and dividend disbursing agent services.

The Asset Allocation Fund paid FPS, for the fiscal years ended June 30, 1994,
1995, and 1996, $15,771, $11,101, and ______, respectively. These fees were
for transfer and dividend disbursing agent services.

The Tax Exempt Bond Fund paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $28,536, $21,475, and ______, respectively. These fees were
for transfer and dividend disbursing agent services.

<PAGE>

The Money Market Series paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $71,526, $41,216, and ______, respectively. These fees were
for transfer and dividend disbursing agent services.

Accounting Services

The Funds have entered into Accounting Services Agreements with FPS. These
Agreements require FPS to calculate each Fund's net asset value in accordance
with the provisions of the Funds' current Prospectus and to prepare for Fund
approval and use various government reports, tax returns, and proxy
materials. Each Fund will pay a minimum fee of $25,000 for these services and
additional fees based on declining percentages of their respective average
net assets in excess of $10,000,000. Management believes the fees for these
services are comparable to those charged by others who perform such
accounting services.

The Growth Fund paid FPS for the fiscal years ended June 30, 1994, 1995, and
1996, $45,128, $44,673, and _______, respectively.

The Asset Allocation Fund paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $25,089, $25,883, and _______, respectively.

The Tax Exempt Bond Fund paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $29,049, $30,271, and _______, respectively.

The Money Market Series paid FPS for the fiscal years ended June 30, 1994,
1995, and 1996, $39,106, $35,458, and _______, respectively.

Administrative Services

The Funds have entered into Administration Agreements with FPS. These
Agreements provide that the Administrator shall provide all administrative
services to each Fund other than those relating to the investment portfolio
of the Funds, the distribution of the Funds and the maintenance of each
Fund's financial records. The fees for these services are based on declining
percentages of each Fund's average net assets beginning at .0015% of the
first $50,000,000 of average net assets, .0010% on the next $50,000,000 of
average net assets, and .0005% over $100,000,000 of average net assets. The
Funds are, however, required to pay minimum annual administrative fees. The
minimum annual fee for the Growth Fund is $50,000. The minimum annual
administrative fee for each of the Asset Allocation Fund, the Tax Exempt Bond
Fund, the Money Market Series, and the Taxable Fixed Income Series Fund is
$10,000.

For the fiscal year ended June 30, 1996, the Growth Fund paid _______ to FPS
for administrative services.

For the fiscal year ended June 30, 1996, the Asset Allocation Fund
paid _______ to FPS for administrative services.

For the fiscal year ended June 30, 1996, the Tax Exempt Bond Fund paid
_______ to FPS for administrative services.

For the fiscal year ended June 30, 1996, the Money Market Series paid _______
to FPS for administrative services.

The Custodian

10
<PAGE>

IAA Trust Company, 808 IAA Drive, Bloomington, Illinois 61702, serves as
Custodian for the Funds and all securities and cash of each Fund will be held
by it. None of the Directors, Officers or other employees of the Funds ever
have personal possession of any Fund's investments. The Custodian attends to
the collection of principal and income, pays and collects all monies for
securities bought and sold by each Fund, and performs certain other
ministerial duties. These services do not include any managerial or policy
making functions of the Funds. The Funds have agreed to pay the Custodian
such compensation as may be agreed upon from time to time, but currently the
Custodian is voluntarily waiving the receipt of any fees for custodial
services.

Independent Accountants

The accounting firm of Coopers & Lybrand L.L.P., 2400 Eleven Penn Center,
Philadelphia, Pennsylvania, has been designated as Auditors for each Fund.
Coopers & Lybrand L.L.P. performs annual audits of each Fund and is
periodically called upon to provide accounting and tax advice.

BROKERAGE

GROWTH FUND, and ASSET ALLOCATION FUND:

These Funds always seek to effect their respective transactions in buying and
selling portfolio securities, acting through a broker as agent or with a
dealer as principal so that they can obtain reasonable execution at the most
favorable prices. Accordingly, each Fund, through IAA Trust Company, the
Investment Adviser, negotiates commission rates in accordance with the
reliability and quality of a broker's or dealer's services, the financial
condition of the firm and the value and expected contribution of the
broker-dealer to the performance of the Fund on a continuing basis. Thus,
what a Fund determines to be the most favorable commission price may be
higher than the lowest available price. In evaluating the overall
reasonableness of brokerage commissions paid, the Fund through its Investment
Adviser, maintains an awareness of general practices with regard to
commission levels and rates charged by reputable brokerage firms.

While there is no undertaking or agreement with any broker or dealer to do
so, either Fund may, subject to the primary brokerage allocation criterion
that a Fund obtain reasonable execution at the most favorable prices, place
orders for the purchase or sale of portfolio securities with brokers or
dealers who have provided research, statistical, or other financial
information to the Fund or its Investment Adviser. Brokerage house research
generally provides economic and financial market analysis as well as industry
studies and investment analysis of individual companies or entities.

The primary brokerage allocation criterion of the Funds is that each Fund
obtain reasonable execution at the most favorable prices. If two or more
brokers or dealers meet this criterion, a Fund may, although there is no
undertaking or agreement with any broker or dealer to do so or any specific
internal allocation procedure, place orders for the purchase or sale of
portfolio securities with brokers or dealers who have provided research,
statistical or other financial information to the Fund or its Investment
Adviser. Research information obtained from brokers and dealers while
servicing the Fund may be used by IAA Trust Company in servicing all of its
accounts and, conversely, research information obtained from brokers and
dealers while servicing other accounts may be used by IAA Trust Company in
servicing the Fund. Further, all research information obtained from brokers
and dealers while serving the Fund may not be used by the Fund.

Over-the-counter transactions are usually placed with a principal market
maker unless a better net security price is obtainable elsewhere.

During the fiscal years ended June 30, 1994, 1995, and 1996, brokerage
commissions paid by the Growth Fund totaled $135,169, $64,267, and ______,
respectively. No brokerage transactions were allocated to brokers or dealers
for the sale of the Fund's shares; such sales are made by Fund/Plan Broker

<PAGE>

Services, Inc. and Country Capital Management Company through their own
representatives.

During the fiscal years ended June 30, 1994, 1995, and 1996, brokerage
commissions paid by the Asset Allocation Fund totaled $4,558, $6,980, and
______, respectively. No brokerage transactions were allocated to brokers or
dealers for the sale of the Fund's shares; such sales are made by Fund/Plan
Broker Services, Inc. and Country Capital Management Company through their
own representatives.

There may be occasions when portfolio transactions for these Funds are
executed as part of concurrent authorizations to purchase or sell the same
security for other Funds served by IAA Trust Company. Although such
concurrent authorizations potentially could be either advantageous or
disadvantageous to a Fund, they are effected only when a Fund, acting on the
advice of IAA Trust Company, believes that to do so is in the interest of
such Fund. When such concurrent authorizations occur, the executions will be
allocated in an equitable manner.

TAX EXEMPT BOND FUND, SHORT-TERM GOVERNMENT BOND SERIES, AND LONG-TERM
BOND SERIES:

This Fund always seeks to effect its transactions in buying and selling
portfolio securities, acting through a broker as agent or with a dealer as
principal so that it can obtain reasonable execution at the most favorable
prices. Accordingly, the Tax Exempt Bond Fund, through IAA Trust Company, its
Investment Adviser, negotiates commission rates in accordance with the
reliability and quality of a broker's or dealer's services, the financial
condition of the firm and the value and expected contribution of the
broker-dealer to the performance of the Fund on a continuing basis. Thus,
what the Tax Exempt Bond Fund determines to be the most favorable commission
price may be higher than the lowest available price. In evaluating the
overall reasonableness of brokerage commissions paid, the Tax Exempt Bond
Fund through its Investment Adviser, maintains an awareness of general
practices with regard to commission levels and rates charged by reputable
brokerage firms.

The primary brokerage allocation criterion of each Fund is that the Fund
obtain reasonable execution at the most favorable prices. If two or more
brokers or dealers meet this criterion, the Fund may, although there is no
undertaking or agreement with any broker or dealer to do so or any specific
internal allocation procedure, place orders for the purchase or sale of
portfolio securities with brokers or dealers who have provided research,
statistical or other financial information to the Fund or its Investment
Adviser. Brokerage house research generally provides economic and financial
market analysis as well as industry studies and investment analysis of
individual companies or entities.

It is the opinion of the Investment Adviser that the furnishing of research,
statistical, and other financial information to either the Fund or the
Investment Adviser by brokers and dealers will not materially reduce the cost
to the Investment Adviser of fulfilling the terms of its advisory contract
with the Fund because the Investment Adviser must review and analyze such
information along with all other information available to it. Research
information obtained from brokers and dealers while servicing the Fund may be
used by IAA Trust Company in servicing all of its accounts and, conversely,
research information obtained from brokers and dealers while servicing other
accounts may be used by IAA Trust Company in servicing each Fund. Further,
all research information obtained from brokers and dealers while servicing
the Fund may not be used by the Fund.

During the fiscal years ended June 30, 1994, 1995, and 1996, all transactions
for the Tax Exempt Bond Fund were placed with a principal market dealer. No
commissions as such are paid on transactions with the principal market dealer
as the asked price on such transactions usually includes an allowance for
such compensation.

No brokerage transactions are allocated to brokers or dealers for the sale of
the Fund's shares; such sales are made by Fund/Plan Broker Services, Inc. and
Country Capital Management Company through their own representatives.

There may be occasions when portfolio transactions for this Fund are executed
as part of concurrent authorizations to purchase or sell the same security
for other Funds served by IAA Trust Company. Although

12
<PAGE>

such concurrent authorizations potentially could be either advantageous or
disadvantageous to a Fund, they are effected only when a Fund, acting on the
advice of IAA Trust Company, believes that to do so is in the interest of
such Fund. When such concurrent authorizations occur, the executions will be
allocated in an equitable manner.

MONEY MARKET SERIES:

This Fund, acting on recommendations received from its Investment Adviser,
IAA Trust Company, expects that purchases and sales of portfolio securities
usually will be principal transactions. Portfolio securities will normally be
purchased directly from the issuer or from an underwriter or a market maker
for the securities. Usually, no brokerage commissions will be paid on such
purchases. Purchases from underwriters of portfolio securities will include a
concession paid by the issuer to the underwriter and the purchase price paid
to market makers for money market instruments may include the spread between
the bid and asked price.

The primary consideration in the allocation of portfolio transactions will be
prompt and effective execution of orders at the most favorable price. If two
or more brokers or dealers meet this criterion, the Fund may, although there
is no undertaking or agreement with any broker or dealer to do so or any
specific internal allocation procedure, place orders for the purchase or sale
of portfolio securities with brokers or dealers who have provided research,
statistical, or other financial information to the Fund or its investment
adviser. Brokerage house research generally provides economic and financial
market analysis as well as industry studies and investment analysis of
individual companies or entities. Such information is of the kind generally
supplied by broker-dealers to their customers without obligation. This
information may be used by IAA Trust Company to supplement its own research
and analysis. Although it is not possible to place a dollar value on this
information, it is the opinion of IAA Trust Company that the receipt and
study of such information does not reduce its expenses. Research information
obtained from brokers and dealers while servicing the Fund may be used by IAA
Trust Company in servicing all of its accounts and, conversely, research
information obtained from brokers and dealers while servicing other accounts
may be used by IAA Trust Company in servicing the Fund. Further, not all
research information obtained from brokers and dealers while servicing the
Fund may be used by the Fund.

During the fiscal years ended June 30, 1994, 1995, and 1996, the Money Market
Series incurred no brokerage commissions.

There may be occasions when portfolio transactions for this Series are
executed as part of concurrent authorizations to purchase or sell the same
security for other Funds served by IAA Trust Company. Although such
concurrent authorizations potentially could be either advantageous or
disadvantageous to a Series, they are effected only when a Series, acting on
the advice of IAA Trust Company, believes that to do so is in the interest of
such Series. When such concurrent authorizations occur, the executions will
be allocated in an equitable manner.

PURCHASES, REDEMPTIONS, AND PRICING OF FUND SECURITIES

For the method followed by the Funds in determining the total offering price
at which each Fund's securities are offered to the public and the method used
to value each Fund's assets, see sections titled "HOW TO BUY SHARES",
"SPECIAL PLANS AND OTHER PURCHASE INFORMATION", "HOW THE VALUE OF YOUR SHARES
IS DETERMINED", and "HOW TO REDEEM YOUR SHARES" in the Funds' Prospectus. See
the following for additional information on various special Plans the Funds
offer to investors.

<PAGE>

Exchange Privileges

A shareholder may exchange his/her shares of one IAA Trust Fund or Series
for shares of another IAA Trust Fund or Series on the basis of the relative
net asset values per share of each Fund at the time of the exchange. When
shares of one Fund or Series are exchanged for shares of another Fund or
Series, the minimum investment requirement of such other Fund or Series must
be met. The two ways to exchange shares, by mail and by telephone, are
discussed below.

By Mail: The exchange can be made by forwarding a written request signed by
the registered shareholder(s) and returning any outstanding certificates
needed to effect the exchange to Fund/Plan Broker Services, Inc. ("FPBS"),
c/o Fund Plan Services, Inc., #2 Elm Street, P.O. Box 874, Conshohocken,
Pennsylvania 19428. Effective November 1, 1996, Fund/Plan Broker Services,
Inc. will have the new name of FPS Broker Services, Inc. and will have the
new address of c/o FPS Services, Inc., 3200 Horizon Drive, P.O. Box 61503,
King of Prussia, PA 19406-0903.

By Telephone: You may make the exchange by telephone provided that: (1) you
have elected the Telephone Exchange option on the initial application or have
authorized this option after your initial purchase; (2) the registration of
the accounts will be identical; and (3) the shares to be exchanged are not in
certificate form. You can call toll-free 1 (800) 245-2100 on any business
day. All telephone conversations with FPBS will be recorded. Neither the
Funds, Country Capital Management Company, or FPBS will be responsible for
the authenticity of the exchange instructions received by telephone.

An exchange is effected by redemption of shares of one Fund or Series and the
issuance of shares of the other Fund or Series selected, and only after
delivery of the current Prospectus. With respect to an exchange among the
Growth Fund, the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Short-Term Government Bond Series, and the Long-Term Bond Series, a capital
gain or loss for Federal income tax purposes will be realized upon the
exchange, depending upon the cost or other basis of the shares redeemed. With
respect to the Money Market Series, assuming such Series maintains its share
value at $1.00 per share, an exchange of this Series's shares for shares of
another IAA Trust Fund or Series should not create a Federal income tax
incident, except for the establishment of a new holding period.

14
<PAGE>

Retirement Plans

IAA Trust Company sponsors a prototype Defined Contribution Plan which has
been approved by the Internal Revenue Service and which meets the requirement
of the Tax Reform Act of 1986, as amended. This Plan can invest in shares of
the Growth Fund, the Asset Allocation Fund, the Money Market Series, the
Short-Term Government Bond Series, or the Long-Term Bond Series.
Contributions to the Plan of up to $30,000 or 25% of earned income, whichever
is the lesser, may be made each year and subtracted from gross income at tax
time.

For individuals eligible to establish an Individual Retirement Account (IRA),
IAA Trust Company sponsors a prototype individual retirement Plan which has
been approved by the Internal Revenue Service. An individual may be able to
deduct contributions made to such a Plan up to an annual amount of $2,000 or
100% of compensation, whichever is less. The deductibility of contributions
to an IRA by taxpayers who are participants in an employer's retirement plan
is determined by the amount of taxpayer's adjusted gross income. If a joint
tax return is filed, a married person whose spouse is not employed may
contribute up to $2,250 annually to be divided in any manner between the
individual's IRA and the IRA established for the nonworking spouse so long as
no more than $2,000 is contributed in any one year to either IRA. The
deductibility of contributions to an IRA by taxpayers who are active
participants in an employer's retirement plan is determined by the amount of
the taxpayer's adjusted gross income. "Rollover contributions" from certain
other tax-qualified plans may also be made to this Plan. The custodial fee
for this Plan is currently $15.00 per year on any portion thereof for all IAA
Trust Company IRA accounts held by one participant and his/her spouse (if
any). Possible penalties may be imposed for excess IRA contributions,
premature withdrawals or insufficient distributions after age 70 1/2.

An investor considering either the Defined Contribution Plan or the IRA Plan
should consult with his or her attorney with respect to Plan requirements and
tax implications. Other information relating to eligibility and service fees
may be obtained by reading the prototype Plans and, in the case of the IRA,
by reading the disclosure statement which the IRA requires to be furnished to
individuals who are considering the adoption of an IRA.

For more information about these Plans, contact IAA Trust Company, 808 IAA
Drive, Bloomington, Illinois 61702 or call toll-free 1 (800) 422-8261.

Automatic Investing

A shareholder may authorize Systematic Investing through automatic
withdrawals from his/her bank accounts.

Systematic Withdrawal Plan

Shareholders who purchase or already own $5,000 or more of any Fund's shares,
valued at the current public offering price, and who wish to receive periodic
payments may establish a Systematic Withdrawal Plan by completing an
application provided by FPBS for this purpose. Such planholders will receive
monthly, quarterly or annual checks in the amount they designate. While no
particular withdrawal amount is necessarily recommended, the minimum is $25.
The amount of payment may be changed at any time. Dividends and capital gains
distributions on a Fund's shares in the Plan are automatically reinvested in
additional shares at net asset value, without a sales charge. All
certificates for shares deposited under this Plan must be surrendered and no

<PAGE>

certificates will be issued unless the Plan is terminated. Payments are made
from the proceeds derived from the redemption of Fund shares owned by the
planholder. With respect to the Growth Fund, the Asset Allocation Fund, and
the Tax Exempt Bond Fund, the Short-Term Government Bond Series, and the
Long-Term Bond Series, each redemption of shares may result in a gain or loss
which is reportable by the investor on his income tax return.

Redemptions required for payments may reduce or use up the planholder's
investment, depending upon the size of payment and market fluctuations, if
applicable. Accordingly, Plan payments cannot be considered as yield or
income on the investment. Additional purchases may be made under the
Systematic Withdrawal Plan in amounts of $5,000 or more.

Fund/Plan Services, Inc., ("FPS") as agent for the shareholder, may make a
charge for services rendered beyond those normally assumed by the Funds. No
such charge is currently assessed, but such a charge may be instituted by FPS
upon notice in writing to shareholders. This Plan may be terminated at any
time without penalty upon written notice by the shareholder, by the Funds, or
by FPS.

UNDERWRITER COMPENSATION

Shares of the Funds are continuously offered to the public through Fund/Plan
Broker Services, Inc. ("FPBS").

Currently, out of commissions to be received, FPBS has agreed to pay all
expenses incident to the distribution of shares. If commissions are not
sufficient to pay these expenses, FPBS will look to the Funds' Investment
Adviser for reimbursement. For the fiscal year ended June 30, 1996, FPBS
received no underwriting fees.

For additional information, see "WHO DISTRIBUTES THE FUNDS SHARES" in the
Funds' Prospectus.

<PAGE>

INVESTMENT PERFORMANCE INFORMATION

From time to time, the Funds advertise their various respective performance
measures, such as: 7- or 30-day yield; tax-equivalent yield; total percentage
increase; and total return. Performance will vary and the results shown
herein and in the Funds' Prospectus are historical information and will not
be representative of future results. Factors affecting the Funds' performance
include general market conditions, operating expenses, and portfolio
management. No adjustment has been made for taxes payable on dividends and
distributions.

Total Return Calculations

With respect to the Growth Fund, the Asset Allocation Fund, the Tax Exempt
Bond Fund, the Long-Term Government Bond Series, and the Short-Term Bond
Series the Funds and Series that compute their average annual total returns
do so by determining the average annual compounded rates of return during
specified periods that equate the initial amount invested to the ending
redeemable value of such investment. This is done by dividing the ending
redeemable value of a hypothetical $1,000 initial payment by $1,000 and
raising the quotient to a power equal to one divided by the number of years
(or fractional portion thereof) covered by the computation and subtracting
one from the result. This calculation can be expressed as follows:

Average Annual Total Return = (ERV) 1/n -1
-----
(P)

Where: ERV = ending redeemable value at the end of the period
covered by the computation of a hypothetical
$1,000 payment made at the beginning of the period.

P = hypothetical initial payment of $1,000.

n = period covered by the computation, expressed in
terms of years.

The Funds and Series that compute their aggregate total returns over a
specified period do so by determining the aggregate compounded rate of return
during such specified period that likewise equates over a specified period
the initial amount invested to the ending redeemable value of such
investment. The formula for calculating aggregate total return is as follows:

Aggregate Total Return = (ERV) -1
-----
P
Where: ERV = ending redeemable value at the end of the period
covered by the computation of a hypothetical
$1,000 payment made at the beginning of the period.

P = hypothetical initial payment of $1,000.

The calculations of average annual total return and aggregate total return
assume the reinvestment of all dividends and capital gain distributions on
the reinvestment dates during the period. The ending redeemable value
(variable "ERV" in each formula) is determined by assuming complete
redemption of the hypothetical investment and the deduction of all
nonrecurring charges at the end of the period covered by the computations.
Such calculations are

<PAGE>

not necessarily indicative of future results and do not take into account
Federal, state and local taxes that shareholders must pay on a current basis.

Since performance will fluctuate, performance data for the Funds and Series
should not be used to compare an investment in a Fund's or Series' shares
with bank deposits, savings accounts and similar investment alternatives
which often provide an agreed or guaranteed fixed yield for a stated period
of time. Shareholders should remember that performance is generally a
function of the kind and quality of the instruments held in a portfolio,
portfolio maturity, operating expenses and market conditions.

30-day Yield Calculations

With respect to the Asset Allocation Fund, the Tax Exempt Bond Fund, the
Long-Term Government Bond Series, and the Short-Term Bond Series the yield of
each of these Funds or Series is calculated by dividing the net investment
income per share (as described below) earned by the Fund or Series during a
30-day (or one month) period by the maximum offering price per share on the
last day of the period and annualizing the result on a semi-annual basis by
adding one to the quotient, raising the sum to the power of six, subtracting
one from the result and then doubling the difference. A Fund's or Series' net
investment income per share earned during the period is based on the average
daily number of shares outstanding during the period entitled to receive
dividends and includes dividends and interest earned during the period minus
expenses accrued for the period, net of reimbursements. This calculation can
be expressed as follows:

YIELD = 2 [(a-b+1)-1]
---
cd
Where: a = dividends and interest earned during the period.

b = expenses accrued for the period (net of reimbursements).

c = sthe average daily number of shares
outstanding during the period that were
entitled to receive dividends.

d = maximum offering price per share on the last day
of the period.

For the purpose of determining net investment income earned during the period
(variable "a" in the formula), dividend income on equity securities held by a
Fund or Series is recognized by accruing 1/360 of the stated dividend rate of
the security each day that the security is in the Fund or Series. Except as
noted below, interest earned on any debt obligations held by a Fund or Series
is calculated by computing the yield to maturity of each obligation held by
that Fund or Series based on the market value of the obligation (including
actual accrued interest) at the close of business on the last business day of
the month, the purchase price (plus actual accrued interest) and dividing the
result by 360 and multiplying the quotient by the market value of the
obligation (including actual accrued interest) in order to determine the
interest income on the obligation for each day of the subsequent month that
the obligation is held by that Fund or Series. For purposes of this
calculation, it is assumed that each month contains thirty days. The date on
which the obligation reasonably may be expected to be called or, if none, the
maturity date. With respect to debt obligations purchased at a discount or
premium, the formula generally calls for amortization of the discount
premium. The amortization schedule will be adjusted monthly to reflect
changes in the market values of such debt obligations.

Expenses accrued for the period (variable "b" in the formula) include all
recurring fees charged by a Fund or Series to all shareholder accounts in
proportion to the length of the base period and the Fund's or Series' mean
(or median) account size. Undeclared earned income will be subtracted from
the offering price per capital share (variable "d" in the formula).

With respect to the Tax Exempt Bond Fund, interest earned on tax-exempt
obligations that are issued without

<PAGE>

original issue discount and have a current market discount is calculated by
using the coupon rate of interest instead of the yield to maturity. In the
case of tax-exempt obligations that are issued with original issue discount
but which have discounts based on current market value that exceed the
then-remaining portion of the original discount (market discount), the yield
to maturity is the imputed rate based on the original issue discount
calculation. On the other hand, in the case of tax-exempt obligations that
are issued with original issue discount but which have discounts based on
current market value that are less than the then-remaining portion of the
original discount (market premium), the yield to maturity is based on the
market value.

With regard to mortgage or other receivables-backed obligations which are
expected to be subject to monthly payments of principal and interest
("pay-downs"): (I) gain or loss attributable to actual monthly pay-downs are
accounted for as an increase or decrease to interest income during the
period; and (ii) a Fund may elect either (a) to amortize the discount and
premium on the remaining security, based on the cost of the security, to the
weighted average maturity date, if such information is available, or to the
remaining term of the security, if any, if the weighted average date is not
available or (b) not to amortize discount or premium on the remaining
security.

Tax-Equivalent Yield Calculations

With respect to the Tax Exempt Bond Fund, the "tax-equivalent yield" of this
Fund is computed by (a) dividing the portion of the yield (calculated as
above) that is exempt from Federal income tax by one minus a stated Federal
income tax rate and (b) adding to that figure to that portion, if any, of the
yield that is not exempt from Federal income tax.

The tax equivalent yield reflects the taxable yield that an investor at the
highest marginal Federal income tax rate would have to receive to equal the
primarily tax-exempt yield from the Fund. Before investing in a tax-exempt
fund, you may want to determine which investment -- tax-free or taxable --
will result in a higher after-tax yield. To do this, divide the yield on the
tax-free investment by the decimal determined by subtracting from 1 the
highest Federal tax rate you pay. For example, if the tax-free yield is 5%
and your maximum tax bracket is 36%, the computation is:

5% Tax-Free Yield - (1/.36 Tax Rate) = 5%/.64% = 7.8125% Tax Equivalent
Yield

In this example, your after-tax return would be higher from the 5% tax-free
investment if available taxable yields are below 7.8125%. Conversely, the
taxable investment would provide a higher yield when taxable yields exceed
7.8125%.

7-day Yield Calculations

The Money Market Fund's standard yield quotations as they appear in reports
and other material distributed by the Fund or by Country Capital Management
Company are calculated by a standard method prescribed by rules of the
Securities and Exchange Commission. The yield of this Fund for a 7-day period
(the "base period") will be computed by determining the net change in value
(calculated as set forth below) of a hypothetical account having a balance of
one share at the beginning of the period, dividing the net change in account
value by the value of the account at the beginning of the base period to
obtain the base period return, and multiplying the base period return by
365/7 with the resulting yield figure carried to the nearest hundredth of one
percent.

Net changes in value of a hypothetical account will include the value of
additional shares purchased with dividends from the original share and
dividends declared on both the original share and any such additional shares,
but will not include realized gains or losses or unrealized appreciation or
depreciation on portfolio investments.

The effective yield is computed by compounding the unannualized base period
return by adding 1 to the base period return, raising the sum to a power
equal to 365 divided by 7, and subtracting one from the result, according

<PAGE>

to the following formula:

Effective Yield = [(base period return + 1)^(365/7)]-1

THE GROWTH FUND:

This Fund's net asset value and return will fluctuate. Please note the
differences and similarities between the investments which the Fund may
purchase for its portfolio and the investments measured by the index which is
described in the Prospectus. Please refer to the Prospectus for specific
information.

THE ASSET ALLOCATION FUND:

This Fund's net asset value, return, and yield will fluctuate. The Fund's
yield for the thirty days ended June 30, 1996 was ______. Yield differs from
total return in that it only considers current income and does not take into
account gains or losses on securities held by the Fund. Please refer to the
Prospectus for specific information.

THE TAX EXEMPT BOND FUND:

The above yield results in a tax-equivalent yield of ______ for the thirty
days ended June 30, 1996.

THE MONEY MARKET SERIES:

The yield and effective yield of this Fund will vary in response to
fluctuations in interest rates and in the expenses of the Fund. For the seven
days ended June 30, 1996 the Fund's annualized standard (cash) yield was
______ and its annualized effective (compound) yield was ______ . For
comparative purposes, the current and effective yields should be compared to
current and effective yields offered by competing financial institutions for
the same base period and calculated by the methods described above.

The Funds' Financial Statements, including the notes thereto, dated as of
June 30, 1996, which have been audited by Coopers and Lybrand, L.L.P., are
incorporated by reference from the Funds' Annual report to shareholders.

<PAGE>

APPENDIX

Commercial Paper Ratings

Moody's Investors Service, Inc.: "Prime-1" and "Prime-2" are Moody's two
highest commercial paper rating categories. Moody's evaluates the salient
features that affect a commercial paper issuer's financial and competitive
position. The appraisal includes, but is not limited to the review of such
factors as:

1. Quality of management.
2. Industry strengths and risks.
3. Vulnerability to business cycles.
4. Competitive position.
5. Liquidity measurements.
6. Debt structures.
7. Operating trends and access to capital markets.

Differing degrees of weight are applied to the above factors as deemed
appropriate for individual situations.

Standard & Poor's Corporation: "A-1" and "A-2" are S&P's two highest
commercial paper rating categories and issuers rated in these categories
have the following characteristics:

1. Liquidity ratios are adequate to meet cash requirements.
2. Long-term senior debt is rated "A" or better.
3. The issuer has access to at least two additional channels of
borrowing.
4. Basic earnings and cash flow have an upward trend with allowance
made for unusual circumstances.
5. Typically, the issuer is in a strong position in a
well-established industry or industries.
6. The reliability and quality of management is unquestioned.

Relative strength or weakness of the above characteristics determine
whether an issuer's paper is rated "A-1" or "A-2". Additionally, within
the "A-1" designation, those issues determined to possess overwhelming
safety characteristics are denoted with a plus (+) rating category.

Bond Ratings

Standard and Poor's Corporation: An S&P bond rating is a current
assessment of the creditworthiness of an obligor with respect to a
specific debt obligation. This assessment may take into consideration
obligors such as guarantors, insurers or lessees.

The bond ratings are not a recommendation to purchase, sell or hold a
security, inasmuch as it does not comment as to market price or
suitability for a particular investor.

The ratings are based on current information furnished by the issuer or
obtained by S&P from other sources it considers reliable. S&P does not
perform any audit in connection with any ratings and may, on occasion,
rely on unaudited financial information. The ratings may be changed,
suspended or withdrawn as a result of changes in, or unavailability of,
such information, or for other circumstances.

The ratings are based, in varying degrees, on the following
considerations:

I. Likelihood of default-capacity and willingness of the obligor as
to the timely payment of interest and repayment of principal in
accordance with the terms of the obligation;
II. Nature of and provisions of the obligation;
III.Protection afforded by, and relative position of, the obligation
in the event of bankruptcy, reorganization or other arrangement
under the laws of bankruptcy and other laws affecting creditor's
rights.

<PAGE>

The four highest bond ratings of S&P and their meanings are:

"AAA" Bonds rated "AAA" have the highest rating assigned by S&P to
a debt obligation. Capacity to pay interest and repay
principal is extremely strong.

"AA" Bonds rated "AA" have a very strong capacity to pay interest
and repay principal and differ from the highest rated issues
only in small degree.

"A" Bonds rated "A" have a strong capacity to pay interest and
repay principal although they are somewhat more susceptible
to the adverse effects of changes in circumstances and
economic conditions than bonds in higher rated categories.

"BBB" Bonds rated "BBB" are regarded as having an adequate capacity
to pay interest and repay principal. Whereas they normally
exhibit adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to lead
to a weakened capacity to pay interest and repay principal
for bonds in this category than for bonds in higher rated
categories.

Plus (+) or Minus (-): The ratings from "AA" to "BB" may be modified by
the addition of a plus or minus sign to show relative standing within the
major rating categories.

Provisional Ratings The letter "p" indicates that the rating is
provisional. A provisional ratings assumes the successful completion of
the project being financed by the bonds being rated and indicate that
payment of debt service requirements is largely or entirely dependent upon
the successful and timely completion of the project. This rating, however,
while addressing credit quality subsequent to completion of the project,
makes no comment on the likelihood of, or the risk of default upon failure
of, such completion. The investor should exercise his own judgement with
respect to such likelihood and risk.

Under present commercial bank regulations issued by the Comptroller of the
Currency, bonds rated in the top four categories ("AAA", "AA", "A", and
"BBB", commonly known as "Investment Grade" ratings) are generally
regarded as eligible for bank investment.

<PAGE>

Moody's Investors Service, Inc.: The four highest ratings of Moody's and
their meanings are:

"Aaa" Bonds which are rated "Aaa" are judged to be of the best quality.
They carry the smallest degree of investment risk and are
generally referred to as "gilt edge". Interest payments are
protected by a large or by an exceptionally stable margin and
principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most
unlikely to impair the fundamentally strong position of such
issues.

"Aa" Bonds which are rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group they comprise what are
generally known as high grade bonds. They are rated lower then the
best bonds because margins of protection may not be as large as in
"Aaa" securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which
make the long-term risks appear somewhat larger than in "Aaa"
securities.

"A" Bonds which are rated "A" possess many favorable investment
attributes and are to be considered as upper medium grade
obligations. Factors giving security to principal and interest are
considered adequate, but elements may be present which suggest a
susceptibility to impairment sometime in the future.

"Baa" Bonds which are rated "Baa" are considered as medium grade
obligations; i.e., they are neither highly protected nor poorly
secured. Interest payments and principal security appear adequate
for the present but certain protective elements may be lacking or
may be characteristically unreliable over any great length of
time. Such bonds lack outstanding investment characteristics and
in fact have speculative characteristics as well.

Descriptions of Short-Term Instruments

Obligations of the U.S. Government, its Agencies and Instrumentalities:

Securities issued or guaranteed by the U.S. Government include a
variety of Treasury securities, which differ only in their interest
rate, maturity and date of issuance. Treasury bills have a maturity of
one year or less. Treasury notes have a maturity of one to ten years
and Treasury bonds generally have maturities of greater than ten years
at the date of issuance. Some obligations of U.S. Government agencies
and instrumentalities such as Treasury bills and Government National
Mortgage Association pass-through certificates, are supported by the
full faith and credit of the U.S. Treasury; others, such as securities
of Federal Loan Banks, have the right of the issuer to borrow from the
Treasury; and still others, such as bonds issued by Federal National
Mortgage Association, a private corporation, are supported only by the
credit of the instrumentalities. No assurance can be given that the
U.S. Government would provide financial support to U.S. Government
instrumentalities as it is not obligated to do so by law.

Certificates of Deposit:

In essence, a certificate of deposit is a negotiable receipt issued by
a bank or savings and loan association in exchange for the deposit of
funds. The issuer agrees to pay the amount deposited plus interest to
the bearer of the receipt on the date specified on the certificate.

Bankers' Acceptances:

A bankers' acceptance generally arises from a short-term credit
arrangement designed to enable businesses to obtain funds to finance
commercial transactions. Generally, an acceptance is a time draft
drawn on a bank by an exporter or an importer to obtain a stated
amount of funds to pay for specific merchandise. The draft is then
"accepted" by the bank that, in effect, unconditionally guarantees to
pay the face value of the instrument on its maturity date.

<PAGE>

Commercial Paper:

Commercial paper is generally defined as unsecured short-term notes
issued in bearer form by large, well-known corporations and finance
companies. Maturities on commercial paper range from a few days to
nine months.

Repurchase Agreements:

Repurchase agreements are transactions in which a Fund purchases a
security (usually a U.S. Government obligation) and simultaneously
obtains the commitment of the seller (a member bank of the Federal
Reserve System) to repurchase the security at an agreed upon price on
an agreed upon date usually not more than seven days from the date of
purchase. The resale price reflects the purchase price plus an agreed
upon market rate of interest which is unrelated to the coupon rate or
maturity of the purchased security. Such transactions afford an
opportunity for a Fund to earn a return on cash which is only
temporarily available. The Fund's risk is limited to the ability of
the seller to pay the agreed upon sum upon the delivery date, but the
seller's obligation is in effect secured by the value of the
underlying security. With respect to the Money Market Fund, repurchase
agreements of over seven day's duration will not be more than 10% of
the assets of such Fund.

Foreign Securities Risks

Foreign securities involve investment risk in addition to those of
domestic obligations of domestic issuers, including the possibility that:
liquidity can be impaired because of future political and economic
developments; the obligations may be less marketable than comparable
domestic obligations of domestic issuers; a foreign jurisdiction might
impose withholding taxes or interest income payable on these obligations;
deposits may be seized or nationalized; foreign governmental restrictions
such as exchange controls may be adopted which might adversely affect the
payment of principal and interest on those obligations; the selection of
foreign bank obligations might be more difficult because there may be less
publicly available information concerning foreign banks; there may be
difficulties in obtaining or enforcing a judgement against a foreign bank;
or the accounting, auditing and financial reporting standards, practices
and requirements applicable to foreign banks may differ from those
applicable to U.S. banks. Foreign banks are not subject to examination by
any U.S. Government agency or instrumentality.

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

Form N-1A

Part C - Other Information

Item 24. Financial Statements and Exhibits:

(a) Financial Statements Included in Part A:

"Financial Highlights" - Incorporated by reference to
Post-Effective Amendment Number 18 dated October 27, 1995.
Financial Highlights for the Money Market Series, for the fiscal
year ending June 30, 1996 will be filed with Post-Effective
Amendment Number 20 on October 28, 1996.

Financial Statements Included in Part B:

Incorporated by reference to Post-Effective Amendment Number 18
dated October 27, 1995. Financial Statements for the Money Market
Series, for the fiscal year ending June 30, 1996 will be filed
with Post-Effective Amendment Number 20 on October 28, 1996.

(b) Exhibits Filed Pursuant to Form N-1A (or other document noted):

(1) Articles of Incorporation dated April 14, 1981, as amended June
24, 1996, reflecting name change and change in classes of
stock -- filed herewith.

(2) Copies of Bylaws -- to be filed with the Post-Effective Amendment
Number 20 on October 28, 1996.

(3) Copies of any voting trust agreement -- Not Applicable.

(4) Copies of all instruments defining the rights of holders of the
securities:

Copies of Specimen Stock Certificate. -- Incorporated by
reference to Exhibit No. (1) to Registration Statement filed
August 1981.

(5) Copies of all Investment Advisory Contracts:

(a) Investment Advisory Agreement for IAA Trust Money Market
Fund, Inc. with IAA Trust Company -- to be filed with the
Post-Effective Amendment Number 20 on October 28, 1996.

(b) Amendment dated July 29, 1996 reflecting name change -- to
be filed with the Post-Effective Amendment Number 20 on
October 28, 1996.

(6) Copies of each underwriting or distribution contract:

(a) Underwriting Agreement for IAA Trust Money Market Fund, Inc.
-- filed herewith.

(b) Amendment dated July 29, 1996, to Underwriting Agreement,
reflecting name change and the creation of two new Series --
filed herewith.

(7) Copies of all bonus, profit sharing, pension or similar contracts
-- Not Applicable.

<PAGE>

(8) Custodian Agreement with IAA Trust Company -- to be filed with
the Post-Effective Amendment Number 20 on October 28, 1996.

(9) Copies of all other material contracts not made in the ordinary
course of business which are to be performed:

(a)(i) Copies of Transfer Agent Services Agreement -- filed
herewith.

(ii) Amendment dated July 29, 1996, to Transfer Agent
Services Agreement, reflecting the name change and the
creation of two new Series -- filed herewith.

(b)(i) Copies of Administration Agreement -- filed herewith.

(ii) Amendment dated July 29, 1996, to Administration
Agreement, reflecting the name change and the creation
of two new Series -- filed herewith.

(c)(i) Copies of Accounting Services Agreement -- filed
herewith.

(ii) Amendment dated July 29, 1996, to Accounting Services
Agreement, reflecting the name change and the creation
of two new Series -- filed herewith.

(10) Opinion and consent of Counsel -- to be filed with the
Post-Effective Amendment Number 20 on October 28, 1996.

(11) Copies of any other opinions, appraisals or rulings.

Consent of Independent Auditors -- to be filed with the
Post-Effective Amendment Number 20 on October 28, 1996.

(12) All financial statements omitted from Item 23 -- Not Applicable.

(13) Agreements regarding initial capital:

(a) Subscription Agreement -- to be filed with the
Post-Effective Amendment Number 20 on October 28, 1996.

(b) Letter of Intent of initial subscriber of shares -- to be
filed with the Post-Effective Amendment Number 20 on October
28, 1996.

(14) Copies of the model retirement plan -- to be filed with the
Post-Effective Amendment Number 20 on October 28, 1996.

(15) Copies of any plan or agreement entered into by Registrant
pursuant to Rule 12b-1:

(a) 12b-1 Plan for IAA Trust Taxable Fixed Income Series Fund,
Inc. on behalf of IAA Trust Short-Term Government Bond
Series with Fund/Plan Broker Services, Inc. -- to be filed
with the Post-Effective Amendment Number 20 on October 28,
1996.

(b) 12b-1 Plan for IAA Trust Taxable Fixed Income Series Fund,
Inc. on behalf of IAA Trust Long-Term Bond Series with
Fund/Plan Broker Services, Inc. -- to be filed with the
Post-Effective Amendment Number 20 on October 28, 1996.

(16) Schedule for computation of each performance quotation provided
in the Registration Statement in response to Item 22 -- Not
applicable.

<PAGE>

Item 25. Persons Controlled by or under Common Control with Registrant:

IAA Control Chart -- to be filed with the Post-Effective Amendment
Number 20 on October 28, 1996.

Item 26. Number of Holders of Securities:

(1) (2)
Title of Class Number of Record Holders
-------------- ------------------------
Common
As of October 1, 1996 _________

Item 27. Indemnification

See Item 4 to Registration Statement filed August 1981, and
incorporated herein by reference. The Registrant also purchases Errors
and Omissions insurance with Directors and Officers liability
coverage.

Item 28. Business and Other Connections of Investment Adviser

As of September 29, 1992, IAA Trust Company became the Registrant's
Investment Adviser. The Trust Company serves as Investment Adviser to
IAA Trust Growth Fund, Inc., IAA Trust Asset Allocation Fund, Inc.,
IAA Trust Tax Exempt Bond Fund, Inc., and IAA Trust Taxable Fixed
Income Series Fund, Inc. The Trust Company also provides investment
services to the Country Companies Insurance Group and exercises
fiduciary powers as permitted by its charter and the State of
Illinois.

Other substantial business, professional, vocational or employment
activities of each director and officer of the Registrant's Investment
Adviser during the past two fiscal years are set forth below. To the
knowledge of the Registrant, unless so noted, none of these
individuals is or has been at any time during the past two fiscal
years engaged in any other business, profession, vocation or
employment of a substantial nature.

<PAGE>

================================================================================
IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
================================================================================
NAME TITLE/POSITION OTHER BUSINESS
================================================================================
Ronald R. Warfield Director and President Director and President: Illinois
Agricultural Association,
Agricultural Holding Co., CC
Services, Inc., Country Casualty
Insurance Company, Country
Investors Life Assurance Company,
Country Life Insurance Company,
Country Medical Plans, Inc.,
Country Mutual Insurance Company,
Country Preferred Insurance
Company, AgriVisor Services,
Inc., IAA Trust Company, IAA
Trust Growth Fund, Inc., IAA
Trust Asset Allocation Fund,
Inc., IAA Trust Tax Exempt Bond
Fund, Inc., IAA Trust Taxable
Fixed Income Series Fund, Inc.,
and Illinois Agricultural Service
Company; Director and Chairman of
the Board: Country Capital
Management Company; Coordinating
Committee Member of GROWMARK,
Inc. and Chairman, Board of
Trustees, IAA Foundation;
Director: Bank of Gibson City;
Director: American Farm Bureau
Federation and certain of the
affiliated companies. Farmer.
- --------------------------------------------------------------------------------
Rollie D. Moore Director and Vice Director and Vice President:
President Illinois Agricultural
Association, Illinois
Agricultural Holding Co., CC
Services, Inc., Country Capital
Management Company, Country
Casualty Insurance Company,
Country Investors Life Assurance
Company, Country Life Insurance
Company, Country Medical Plans,
Inc., Country Mutual Insurance
Company, Country Preferred
Insurance Company, IAA Trust
Growth Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., IAA
Trust Tax Exempt Bond Fund, Inc.,
IAA Trust Taxable Fixed Income
Series Fund, Inc., IAA Trust
Company; Director: AgriVisor
Services, Inc. and Illinois
Agricultural Service Company;
Vice Chairman, Board of Trustees:
IAA Foundation; Coordinating
Committee Member of GROWMARK,
Inc. Farmer.
- --------------------------------------------------------------------------------
O. Eugene Barkley Director Director: AgriVisor Services,
Inc., Illinois Agricultural
Association, CC Services, Inc.,
Country Casualty Insurance
Company, Country Investors Life
Assurance Company, Country Life
Insurance Company, Country
Medical Plans, Inc., Country
Mutual Insurance Company, Country
Preferred Insurance Company,
GROWMARK, Inc., Illinois
Agricultural Holding Co., IAA
Trust Company. Farmer.
- --------------------------------------------------------------------------------
Robert L. Phelps Director Director: AgriVisor Services,
Inc., Illinois Agricultural
Association, CC Services, Inc.,
Country Casualty Insurance
Company, Country Investors Life
Assurance Company, Country Life
Insurance Company, Country Mutual
Insurance Company, Country
Preferred Insurance Company,
Illinois Agricultural Holding
Co., IAA Trust Company. Farmer.
- --------------------------------------------------------------------------------

<PAGE>

- --------------------------------------------------------------------------------
Darell D. Sarff Trust Officer Director: Illinois Agricultural
Association, AgriVisor Services,
Inc., CC Services, Inc., and
Trust Officer Country Casualty
Insurance Company, Country
Investors Life Assurance Company,
Country Life Insurance Company,
Country Mutual Insurance Company,
Country Preferred Insurance
Company, IAA Communications
Company, IAA Trust Company,
Illinois Agricultural Holding Co.
Farmer.
- --------------------------------------------------------------------------------
Gary E. Mede, C.F.A. Executive Vice Executive Vice President: IAA
President and Trust Trust Company; Vice
Officer President--Investments: Country
Capital Management Company; Vice
President: IAA Trust Growth Fund,
Inc., IAA Trust Asset Allocation
Fund, Inc., and IAA Trust Tax
Exempt Bond Fund, Inc.; IAA Trust
Taxable Fixed Income Series Fund,
Inc.
- --------------------------------------------------------------------------------
Wayne A. Brown Senior Vice President Senior Vice
President--Investments: IAA Trust
Company; Assistant Treasurer:
Country Life Insurance Company;
Vice President: IAA Trust Growth
Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., IAA Trust
Tax Exempt Bond Fund, Inc., and
IAA Trust Taxable Fixed Income
Series Fund, Inc.
- --------------------------------------------------------------------------------
Richard M. Miller Senior Vice President-- Senior Vice President and Senior
Trusts and Senior Trust Trust Officer: IAA Trust Company;
Officer Vice President: IAA Trust Growth
Fund, Inc., IAA Trust Asset
Allocation Fund, Inc., IAA Trust
Tax Exempt Bond Fund, Inc., and
IAA Trust Taxable Fixed Income
Series Fund, Inc.
- --------------------------------------------------------------------------------
Bruce Finks Vice President -- Investment Officer: IAA Trust
Investments Company
- --------------------------------------------------------------------------------
Richard F. Day Vice President and IAA Trust Company; IAA Trust
Controller Growth Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., IAA
Trust Tax Exempt Bond Fund, Inc.,
and IAA Trust Taxable Fixed
Income Series Fund, Inc.
- --------------------------------------------------------------------------------
David Tipsword Vice President--Pension Vice President--Pension Trusts,
Trusts and Trust Trust Officer: IAA Trust Company.
Officer
- --------------------------------------------------------------------------------
Connie Denison Vice President-- Vice President--Management
Management Information Information Systems and Assistant
Systems and Assistant Trust Officer: IAA Trust Company
Trust Officer
- --------------------------------------------------------------------------------
Bernard Dornedon Vice President-- Vice President--Equity
Equity Investments Investments: IAA Trust Company
- --------------------------------------------------------------------------------
Paul M. Harmon Secretary and General Deputy General Counsel: Illinois
Counsel Agricultural Association and
Affiliated Companies, 1991 to
date; Secretary: Country Capital
Management Company, IAA Trust
Growth Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., IAA
Trust Taxable Fixed Income Series
Fund, Inc., IAA Trust Tax Exempt
Bond Fund, Inc., 1995 to date;
and IAA Trust Company, 1996 to
date.
- --------------------------------------------------------------------------------

<PAGE>

- --------------------------------------------------------------------------------
Robert W. Weldon Treasurer Vice President--Finance and
Treasurer: IAA Trust Company,
Illinois Agricultural
Association, CC Services, Inc.,
Country Medical Plans, Inc.,
Country Investors Life Assurance
Company, Country Life Insurance
Company, Country Mutual Insurance
Company, Country Casualty
Insurance Company, Country
Preferred Insurance Company, and
Country Capital Management
Company; Director and Treasurer:
Illinois Agricultural Service
Company; Vice President--Finance
and Treasurer: CC Services, Inc.;
Country Investors Life Assurance
Company; Treasurer: Illinois
Agricultural Holding Co.;
Illinois Agricultural Auditing
Association; IAA Trust Growth
Fund, Inc.; IAA Trust Asset
Allocation Fund, Inc. and IAA
Trust Tax Exempt Bond Fund, Inc.;
IAA Trust Taxable Fixed Income
Series Fund, Inc.; AgriVisor
Services, Inc.
- --------------------------------------------------------------------------------

Item 29. Principal Underwriters:

(a) As of October 1, 1992, in addition to acting as the Registrant's
distributor, Fund/Plan Broker Services, Inc. also served as
distributor of the shares of IAA Trust Growth Fund, Inc., IAA Trust
Asset Allocation Fund, Inc., and IAA Trust Tax Exempt Bond Fund, Inc.
Fund/Plan Broker Services, Inc., the principal underwriter for the
Registrant's securities, currently acts as principal underwriter for
the following entities:

The Brinson Funds
Chicago Trust Funds
Fairport Funds
First Mutual Funds
Focus Trust, Inc.
IAA Trust Mutual Funds
Matthews International Funds
McM Funds
Smith Breeden Series Fund
Smith Breeden Short Duration U.S. Government Fund
Smith Breeden Trust
The Stratton Funds, Inc.
The Japan Alpha Fund
Stratton Growth Fund, Inc.
Stratton Monthly Dividend Shares, Inc.
The Timothy Plan

(b) The table below sets forth certain information as to the Underwriter's
Directors, Officers and Control Persons:

Name and Principal Position and Offices Position and Offices
Business Address with Underwriter with Registrant
- ---------------- ---------------- ---------------

Kenneth J. Kempf Director and President None
2 West Elm Street
Conshohocken, PA 19428-0874

<PAGE>

Lynne M. Cannon Vice President and Principal None
2 West Elm Street
Conshohocken, PA 19428-0874

Rocco J. Cavalieri Director and Vice President None
2 West Elm Street
Conshohocken, PA 19428-0874

Gerald J. Holland Director, Vice President and None
2 West Elm Street Principal
Conshohocken, PA 19428-0874

Joseph M. O'Donnell, Esq. Director and Vice President None
2 West Elm Street
Conshohocken, PA 19428-0874

Sandra L. Adams Assistant Vice President and None
2 West Elm Street Principal
Conshohocken, PA 19428-0874

Mary P. Efstration Secretary None
2 West Elm Street
Conshohocken, PA 19428-0874

John H. Leven Treasurer None
2 West Elm Street
Conshohocken, PA 19428-0874

James W. Stratton may be considered a control person of the Underwriter due to
his direct or indirect ownership of Fund/Plan Services, Inc., the parent of the
Underwriter.

Item 30. Location of Accounts and Records:

The following accounts, books and other documents of Registrant required to
be maintained by Section 31(a) of the 1940 Act and the Rule (17 CFR
270.31a-1 to 31a-3) promulgated thereunder are maintained by Barbara H.
Tolle, Senior Vice President Accounting Services, P.O. Box 874 (#2 West Elm
Street), Conshohocken, PA 19428.

1. Journals, general ledger and supporting ledger.

2. Record of the proof of money balance in all ledger accounts in
form of trial balances.

3. Separate ledger accounts showing each shareholder of record and
the number of shares of capital stock held.

IAA Trust Company maintains record of all portfolio purchases and
sales with supporting authorization and records at 808 IAA Drive,
Bloomington, Illinois 61702.

The Certificate of Incorporation of Registrant is maintained in
safekeeping by Robert W. Weldon, Treasurer, 1701 Towanda Avenue,
Bloomington, Illinois 61702.

The Bylaws of Registrant and minute books of stockholders, directors
and directors' committee meetings are maintained by Paul M. Harmon,
Secretary, 1701 Towanda Avenue, Bloomington, Illinois 61702.

Item 31. Management Services: Not Applicable.

Item 32. Undertakings: None

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Post-Effective
Amendment No. 19 to the Registration Statement under the Securities Act of 1933
and Amendment No. 20 to its Registration Statement under the Investment Company
Act of 1940 to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Bloomington and State of Illinois on the 29th day of
July, 1996.

IAA TRUST TAXABLE FIXED INCOME SERIES
FUND, INC.
(Registrant)

By: ____________________________________
Ronald R. Warfield, President

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment No. 19 to the Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.

SIGNATURE TITLE DATE

- --------------------------- President and Director July 29, 1996
Ronald R. Warfield (Principal Executive Officer)

- --------------------------- Treasurer July 29, 1996
Robert W. Weldon (Principal Financial and
Accounting Officer)

- --------------------------- Director July 29, 1996
Herbert G. Allen

- --------------------------- Director July 29, 1996
Nancy J. Erickson

- --------------------------- Director July 29, 1996
Paul S. Ives

- --------------------------- Director July 29, 1996
William E. Klein, Sr.

- --------------------------- Director July 29, 1996
Ailene Miller

- --------------------------- Director July 29, 1996
Joseph Sommer

<PAGE>

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

Exhibit Index to Part "C"
of
Post-Effective Amendment No. 19

ITEM #24 Financial Statements and Exhibits

99.B Index to Exhibits Pursuant to Form N-1A

99.B(1) Articles of Incorporation

99.B(6)(a) Underwriting Agreement

99.B(6)(b) Amendment to Underwriting Agreement

99.B(9)(a)(i) Transfer Agent Services Agreement

99.B(9)(a)(ii) Amendment to Transfer Agent Services Agreement

99.B(9)(b)(i) Administration Agreement

99.B(9)(b)(ii) Amendment to Administration Agreement

99.B(9)(c)(i) Accounting Services Agreement

99.B(9)(c)(ii) Amendment to Accounting Services Agreement

Filed: State of Maryland April 14, 1981
Amended: June 24, 1996

ARTICLES OF INCORPORATION

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.

l: WE, THE UNDERSIGNED,

Duane L. Miller 7 Kenyon Court, Bloomington, Illinois
Robert W. Weldon 1305 Baugh Drive, Normal, Illinois
Paul M. Harmon, Jr. 6 Clinton Place, Normal, Illinois

each being at least eighteen (18) years of age, do hereby associate
ourselves as Incorporators with the intention of forming a corporation
under and by virtue of the General Laws of the State of Maryland.

2: The name of the corporation is IAA TRUST TAXABLE FIXED INCOME SERIES FUND,
INC. (10/1/92) (6/24/96)

3: The purpose for which the Corporation is formed and the business and
objects to be carried on and promoted are as follows:

A. To generally engage in the business of a diversified open-end
management investment company.

B. To acquire by purchase, subscription or otherwise acquire, hold for
investment or otherwise, and sell, assign, transfer, exchange, dispose
of and otherwise deal in and with, any shares of stock, shares, bonds,
debentures, notes or other obligations, and any certificates,
receipts, warrants or other instruments evidencing rights or options
to receive, purchase or subscribe for the same or representing any
other rights or interests therein, issued or created by any private or
public companies, associations, corporations, syndicates or trusts
incorporated, established or maintained within or outside of the
United States of America, and to possess and exercise in respect
thereof any and all the rights, powers and privileges of individual
holders.

C. To acquire by purchase or otherwise acquire, hold for investment or
otherwise, and to sell, exchange or otherwise dispose of securities or

-1-

<PAGE>

other obligations issued or guaranteed by the United States of
America, by any person, agency or other entity authorized, controlled
or supervised by and acting as an instrumentality of the United States
of America or by any State, Territory or Possession of the United
States of America, the District of Columbia or Puerto Rico, and their
political subdivisions, agencies and instrumentalities.

D. To acquire by purchase, or otherwise acquire, hold for investment
or otherwise, and to sell, exchange or otherwise dispose of securities
or other obligations issued or guaranteed by foreign nations, by any
person, agency or other entity authorized, controlled or supervised by
and acting as an instrumentality of any such nation and by political
subdivisions of such nations or their political subdivisions, agencies
and instrumentalities.

E. To deposit funds from time to time in such accounts as may
reasonably be required, and with or without interest, in any bank,
savings bank, or trust company in good standing, organized under the
laws of the United States of America or any State thereof, or of the
District of Columbia.

F. To conduct researches and investigations in respect to securities,
organizations, business and general business conditions in the United
States and elsewhere to secure information pertaining to the
investment and employment of the assets and funds of the Corporation;
and to procure any or all of the foregoing and to pay compensation
therefor.

G. To consent to the reorganization, merger or consolidation of any of
the companies whose securities are held by the Corporation or to the
sale or lease of all or substantially all of the property and assets
of any such companies to any person, corporation, trust or association
and to exchange any of the shares of stock or other securities issued
therefor upon such reorganization, merger, consolidation, sale or
lease; to deposit any securities of any such company with or pursuant
to the request or direction of any protective, reorganization or
readjustment committee or other agency.

H. To pay all assessments, subscriptions and other sums of money or
other considerations as it may be deemed expedient for the protection
of the Corporation's interest as holder of any stocks or other
securities of any company whose securities are held by the
Corporation, and to exercise any right or option contained in,

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<PAGE>
pertaining to, or granted or issued to holders of any stocks or other
securities for conversion into or exchange for or purchase of other
stocks or securities.

I. Generally to exercise in respect of all property and assets owned,
all rights, powers and privileges which are or may be exercised by any
natural person owning similar property or assets in his own right.

-3-
<PAGE>

J. To acquire all or any part of the good will, rights, property and
business of any firm, person, association or corporation heretofore or
hereafter engaged in any business similar to any business which the
Corporation has power to conduct, and to hold, utilize, enjoy and in
any manner dispose of the whole or any part of the rights, property
and business so acquired and to assume in connection therewith any
liabilities of any such person, firm, association or corporation.

K. To purchase, redeem, acquire, hold, dispose of, transfer and
reissue or cancel its own securities (including shares of its capital
stock) in any manner and to any extent now or hereafter permitted by
the laws of the State of Maryland and by these Articles without the
vote of or consent of the holders of stock of the Corporation.

L. To make and perform any contracts and to do any acts and things,
and to exercise any powers suitable, convenient or proper for the
accomplishment of any of the objects and purposes herein enumerated or
incidental to the powers herein specified, or which at any time may
appear conducive to or expedient for the accomplishment of any of such
objects and purposes.

M. To carry out all or any part of the foregoing objects and purposes
and to conduct business in all or any of its branches in any or all
states, territories, districts and possessions of the United States of
America and in foreign countries; and to maintain offices and agencies
in any and all states, territories, districts and possessions of the
United States of America and in foreign countries.

The foregoing objects and purposes shall, except when otherwise expressed,
be in no way limited to or restricted by reference to or inference from the
terms of any clause of this or any other Section of these Articles of
Incorporation, or of any amendment thereto, and shall each be regarded as
independent of and construed as powers as well as objects and purposes.

The Corporation shall be authorized to exercise and enjoy all of the
powers, rights and privileges granted to or conferred upon corporations of
a similar character by the General Laws of the State of Maryland now or
hereafter in force and the enumeration of the foregoing powers shall not be
deemed to exclude any powers, rights or privileges so granted or conferred.

4: The post office address of the principal office of the Corporation in this
State is c/o The Corporation Trust Incorporated; First Maryland Building,
25 South Charles Street, Baltimore, Maryland, 21201. The name of the
resident agent of the Corporation in

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<PAGE>

this State is The Corporation Trust Incorporated, a corporation of this
State, and the post office address of the resident agent is First Maryland
Building, 25 South Charles Street, Baltimore, Maryland, 21201.

5: The total number of shares of stock which the Corporation has authority to
issue is Two Hundred Fifty Million (250,000,000) shares of the par value of
Ten Cents ($.10) per share and having an aggregate par value of Twenty-Five
Million Dollars ($25,000,000). One Hundred Million (100,000,000) of such
shares shall be designated as IAA Trust Money Market Fund Common Stock;
Fifty Million (50,000,000) of such shares shall be designated as IAA Trust
Short-Term Government Bond Fund Common Stock; and One Hundred Million
(100,000,000) of such shares may be issued as IAA Trust Money Market Fund
Common Stock, IAA Trust Short-Term Government Bond Fund Common Stock or in
such other classes as the Board of Directors may determine. (6/24/96)

6: The number of directors of the Corporation shall be nine (9), which number
may be changed in accordance with the Bylaws of the Corporation. The names
of the directors who shall act until the first annual meeting or until
their successors are duly chosen and qualified, whichever occurs first,
are:

Carleton Apple Enfield, Illinois
Vernal C. Brown Vermont, Illinois
Stanford O. Ege 618 Lennox, Glen Ellyn, Illinois
Vernon Gaus Buckingham, Illinois
Kenneth W. Gorden Rt. 1, Blue Mound, Illinois
Paul S. Ives 11 Edgelea Circle, Clinton, Illinois
William S. Morrison, Jr. 925 Shabona, Indian Hills,
Wilmette, Illinois
Morris E. Nelson Rt. 1 - Box 68, Altona, Illinois
Harold B. Steele Rt. 2, Princeton, Illinois

7: The following provisions are hereby adopted for the purpose of defining,
limiting and regulating the powers of the Corporation and of the directors
and stockholders:

A. The Board of Directors of the Corporation is hereby empowered to
authorize the issuance from time to time of shares of its stock of any
class, whether now or hereafter authorized, for such consideration as
said Board of Directors may deem advisable, subject to the limitations
and restrictions set forth in Article 8 hereof.

B. (1) All assets received by the Corporation as consideration for the
issue or sale of shares of a particular class, together with all

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<PAGE>

income, earnings, profits and proceeds thereof, including any proceeds
derived from the sale, exchange or liquidation thereof, and any assets
derived from any reinvestment of such proceeds in whatever form the
same may be, shall irrevocably belong, for all purposes, to the class
of stock with respect to which they were received, subject only to the
rights of creditors, and shall be so recorded upon the books of
account of the Corporation. The Board of Directors shall have full
power and authority to determine the amount and character of the
assets in which the proceeds of the sale of shares of any class shall
be invested and the proceeds from the sale of shares of different
classes may be invested in the same assets. (6/29/81)

(2) The assets belonging to a particular class of stock shall be
charged with the liabilities (including, in the discretion of the
Board of Directors or its delegate, accrued expenses and reserves)
incurred in respect of such class, and such class shall also be
charged with its share of any other liabilities, such share being
computed by multiplying said liabilities by a fraction, the numerator
of which is the net asset value of the shares of such class
outstanding and the denominator of which is the net asset value
similarly determined of the shares of all classes outstanding to which
such liabilities are determined to be chargeable. The determination of
the Board of Directors or its delegate shall be final and conclusive
as to the amount of liabilities, including accrued expenses and
reserves, which are to be charged to one or more particular classes.
The power to make such determinations may be delegated by the Board of
Directors from time to time to one or more of the directors and
officers of the Corporation, or to an agent of the Corporation
appointed for such purpose. (6/29/81)

(3) In the payment of dividends or in the event of dissolution or
liquidation of the Corporation, the assets belonging to a particular
class of stock may be distributed only to the holders of shares of
such class. In the event that there are any general assets not
belonging to any particular class of stock available for distribution
upon dissolution or liquidation, the distribution of such assets shall
be made to the holders of stock of all classes in proportion to the
net asset value of the respective classes. (6/29/81)

C. No holder of shares of stock of the Corporation shall, as such
holder, have any preemptive or other right to purchase or subscribe
for any stock which this Corporation may issue or sell.

-6-
<PAGE>

D. Each holder of record of stock of this Corporation shall be
entitled to one vote for each share outstanding registered in his name
on the books of the Corporation; each holder of record of a fractional
share of stock shall be entitled to such fraction of one vote as is
the same as the fraction of one share standing registered in his name.
Separate stockholder votes shall be taken by each investment portfolio
on matters affecting an individual portfolio, and when a separate vote
shall be taken, approval by stockholders of one investment portfolio
shall be effective as to that portfolio.

E. The Board of Directors shall have power to determine from time to
time whether and to what extent and at which time and places and under
what conditions and regulations the books, accounts and documents of
the Corporation, or any of them, shall be open to the inspection of
stockholders, except as otherwise provided by law; and except as so
provided, no stockholder shall have any right to inspect any book,
account or document of the Corporation unless authorized to do so by
resolution of the Board of Directors.

F. Each holder of the capital stock of the Corporation may redeem all
or a part of the shares of capital stock, or fractions thereof,
standing in the name of such holder on the books of the Corporation
pursuant to such terms and conditions including the suspension of
redemption for good causes as the Board of Directors may establish
from time to time.

G. The Corporation may purchase in the open market or otherwise
acquire from any owner or holder thereof any shares of its capital
stock, in which case the consideration paid therefor (in cash or in
securities in which the funds of the Corporation shall then be
invested) shall not exceed the net asset value thereof at the time,
determined or estimated in accordance with any method deemed proper by
the Board of Directors and producing an amount approximately equal to
the net asset value, as defined, in accordance with the Resolutions or
Bylaws of the Corporation, of said shares at the time of the purchase
or acquisition by the Corporation thereof less any redemption charge
which may have been established by the Board of Directors. The
Corporation to the extent necessary may sell or cause to be sold any
securities held by it to provide cash for the purchase of its shares.

H. The Board of Directors shall have full power in accordance with
good accounting practice: (1) to determine what receipts of the

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<PAGE>

Corporation shall constitute income available for payment of dividends
and what shall constitute principal, and to make such allocation of
any particular receipt between principal and income as may be deemed
proper; (2) from time to time, in the Board's discretion (i) to
determine whether any and all expenses and other outlays paid or
incurred (including any and all taxes, assessments or governmental
charges which the Corporation may be required to pay or hold under any
present or future law of the United States of America or of any other
taxing authority therein) shall be charged to or paid from principal
or income or both; and (ii) to apportion any and all of said expenses
and outlays, including taxes, between principal and income.

I. The Board of Directors shall have full power to amend, alter or
repeal the Bylaws of the Corporation.

8: Except for the initial issue of shares by the Corporation, its capital
stock shall not be issued and sold for a consideration less than the net
asset value (as defined in accordance with Resolutions or Bylaws of the
Corporation) of said shares at the time of such issue and sale.

The Board of Directors shall have power, in the manner and within the time
permitted by the General Laws of the State of Maryland, to determine what
part of the consideration received by the Corporation for any of the shares
of its capital stock which it shall issue from time to time shall be
capital (which part, however, in all cases shall be not less than the
aggregate par value of the shares so issued) and the excess, if any, at any
given time, of the total net assets of the Corporation over the amount so
determined to be capital shall be surplus.

9: The Corporation is authorized to enter into investment advisory agreements
providing for the management and supervision of the various investment
portfolios of the corporation and the furnishing of advice to the
Corporation with respect to investing in, purchasing or selling securities
or other property and is authorized to enter into an agreement with a bank
having an aggregate capital, surplus and undivided profits of $2,000,000 or
more for the custody of its cash and portfolio securities. Such agreements
shall contain such other terms, provisions and conditions as the Board of
Directors of the Corporation may deem advisable.

10: The Corporation reserves the right from time to time to make any amendment
of its charter, now or hereafter authorized by law, including any amendment
which alters the contract rights, as expressly set forth in this Charter,
of any outstanding stock. The Corporation may take or authorize such action
upon the concurrence of a majority of the aggregate number of votes
entitled to be cast thereon.

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<PAGE>

11: The duration of the Corporation shall be perpetual.

------------------------------
Duane L. Miller

------------------------------
Robert W. Weldon

------------------------------
Paul M. Harmon, Jr.

-9-

UNDERWRITING AGREEMENT

This Agreement, dated as of the 1st day of August, 1995, made by and
between IAA Trust Money Market Fund, Inc. ("the Money Market Fund"), a
corporation duly organized under the laws of the state of Maryland and operating
as a registered investment company under the Investment Company Act of 1940, as
amended (the "Act"); IAA Trust Company ("IAA Trust"), as a corporation duly
organized and existing under the laws of the State of Illinois; and Fund/Plan
Broker Services, Inc. ("Fund/Plan"), a corporation duly organized and existing
under the laws of the State of Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, IAA Trust has been appointed investment advisor (the "Advisor") to
the Money Market Fund; and

WHEREAS, Fund/Plan is a broker-dealer registered with the U.S. Securities
and Exchange Commission and a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD"); and

WHEREAS, the Parties are desirous of entering into an agreement providing
for the distribution by Fund/Plan of the shares of the Money Market Fund (the
"Shares");

NOW, THEREFORE, in consideration of the promises and agreements of the
Parties contained herein and in exchange of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as
follows:

1. Appointment.

The Money Market Fund hereby appoints Fund/Plan as its exclusive agent for
the distribution of the Shares in the fifty United States of America, the
District of Columbia and Puerto Rico, and Fund/Plan hereby accepts such
appointment under the terms of this Agreement. The Money Market Fund agrees
that it will not sell any shares to any person except to fill orders for
the shares received through Fund/Plan; provided, however, that the
foregoing exclusive right shall not apply: (a) to shares issued or sold in
connection with the merger or consolidation of any other investment company
with the Money Market Fund or the acquisition by purchase or otherwise of
all or substantially all of the assets of any investment company or
substantially all of the outstanding shares of any such company by the
Money Market Fund; (b) to shares which may be offered by the Money Market
Fund to its stockholders for reinvestment of cash distributed from capital
gains or net

Page 1 of 9
<PAGE>

investment income of the Money Market Fund; or (c) to shares which may be
issued to shareholders of other funds who exercise any exchange privilege
set forth in the Money Market Fund's Prospectus. Notwithstanding any other
provision hereof, the Money Market Fund may terminate, suspend, or withdraw
the offering of the Shares whenever in its sole discretion, it deems such
action to be desirable.

2. Sale and Repurchase of Shares.

(a) Fund/Plan is hereby granted the right as agent for the Money Market
Fund, to sell Shares to the public against orders therefor at the
public offering price (as defined in sub-paragraph 2.(c) below).

(b) Fund/Plan will also have the right to take, as agent for the Money
Market Fund, all actions which, in Fund/Plan's judgment, are necessary
to carry into effect the distribution of the Shares.

(d) The net asset value of the Shares shall be determined in the manner
provided in the then current prospectus and statement of additional
information relating to the Shares and when determined shall be
applicable to all transactions as provided in the prospectus. The net
asset value of the Shares shall be calculated by the Money Market Fund
or by another entity on behalf of the Money Market Fund. Fund/Plan
shall have no duty to inquire into or liability for the accuracy of
the net asset value per Share as calculated.

(e) On every sale, the Money Market Fund shall receive the applicable net
asset value of the Shares promptly.

(f) Upon receipt of purchase instructions, Fund/Plan will transmit such
instructions to the Money Market Fund or its transfer agent for
registration of the Shares purchased.

(g) Nothing in this Agreement shall prevent Fund/Plan or any affiliated
person (as defined in the Act) of Fund/Plan from acting as underwriter
or distributor for any other person, firm or corporation (including
other investment companies) or in any way limit or restrict Fund/Plan
or such affiliated person from buying, selling, or trading any
securities for its or

Page 2 of 9
<PAGE>

their own account or for the accounts of others for whom it or they
may be acting; provided, however, that Fund/Plan expressly agrees that
it will not for its own account purchase any shares of the Money
Market Fund except for investment purposes and that it will not for
its own account sell any such shares except by redemption of such
shares by the Money Market Fund, and that it will not undertake any
activities which, in its judgment, will adversely affect the
performance of its obligations to the Money Market Fund under this
Agreement.

(h) Fund/Plan may repurchase Shares at such prices and upon such terms and
conditions as shall be specified in the Prospectus.

3. Rules of Sale of Shares.

Fund/Plan does not agree to sell any specific number of Shares. Fund/Plan,
as Underwriter for the Money Market Fund, undertakes to sell Shares on a
best efforts basis and only against orders received therefor. The Money
Market Fund reserves the right to terminate, suspend or withdraw the sale
of its Shares for any reason deemed adequate by it and the Money Market
Fund reserves the right to refuse at any time or times to sell any of its
Shares to any person for any reason deemed adequate by it.

4. Rules of NASD.

(a) Fund/Plan will conform to the Rules of Fair Practice of the NASD and
the securities laws of any jurisdiction in which it directly or
indirectly sells any Shares.

(b) Fund/Plan will require each dealer with whom Fund/Plan has a selling
agreement to conform to the applicable provisions of the Prospectus,
with respect to the public offering price of the Shares, and Fund/Plan
shall not cause the Money Market Fund to withhold the placing of
purchase orders so as to make a profit thereby.

(c) The Money Market Fund and IAA Trust agree to furnish to Fund/Plan
sufficient copies of any and all: agreements, plans, communications
with the public or other materials which the Money Market Fund or IAA
Trust intends to use in connection with any sales of Shares in
adequate time for Fund/Plan to file and clear such materials with the
proper authorities before they are put in use. Fund/Plan and the Money
Market Fund or IAA Trust

Page 3 of 9
<PAGE>

may agree that any such material does not need to be filed prior to
distribution. In addition, the Money Market Fund and IAA Trust agree
not to use any such materials until so filed and cleared for use by
appropriate authorities as well as by Fund/Plan.

(d) Fund/Plan, at its own expense, will qualify as a dealer or broker, or
otherwise, under all applicable state or federal laws required in
order that the Shares may be sold in such states as may be mutually
agreed upon by the Parties.

(e) Fund/Plan shall remain registered with the U.S. Securities and
Exchange Commission and a member of the National Association of
Securities Dealers for the term of this Agreement.

(f) Fund/Plan shall not, in connection with any sale or solicitation of a
sale of the Shares, make or authorize any representative, Service
Organization, broker or dealer to make, any representations concerning
the Shares except those contained in the Prospectus covering the
Shares and in communications with the public or sales materials
approved by Fund/Plan as information supplemental to such Prospectus.
Copies of the Prospectus will be supplied by the Money Market Fund or
IAA Trust to Fund/Plan in reasonable quantities upon request.

5. Records to be Supplied by the Money Market Fund.

The Money Market Fund shall furnish to Fund/Plan copies of all information,
financial statements and other papers which Fund/Plan may reasonably
request for use in connection with the distribution of the Shares
including, but not limited to, one certified copy of all financial
statements prepared for the Money Market Fund by its independent public
accountants.

6. Expenses.

(a) The Money Market Fund will bear the following expenses:

(i) preparation, setting in type, and printing of sufficient copies
of the prospectuses and statements of additional information for
distribution to shareholders, and the distribution of same to the
shareholders;

(ii) preparation, printing, and distribution of reports and other
communications to shareholders;

Page 4 of 9
<PAGE>

(iii) registration of the Shares under the federal securities laws;

(iv) qualification of the Shares for sale in the jurisdictions as
directed by the Money Market Fund;

(v) maintaining facilities for the issue and transfer of the Shares;

(vi) supplying information, prices, and other data to be furnished by
the Money Market Fund under this Agreement; and

(vii) any original issue taxes or transfer taxes applicable to the
sale or delivery of the Shares or certificates therefor.

(b) Underwriter will pay expenses incident to the sale and distribution of
the Shares sold hereunder to the extent that payment of such expenses
is made by the Fund pursuant to a Distribution Plan as set forth under
Rule 12b-1 of the Investment Company Act of 1940, as amended. All
expenses in excess of those monies paid pursuant to the Distribution
Plan will be paid by the Advisor.

7. Term.

(a) The term of this Agreement shall commence on the date hereinabove
first written ("Effective Date").

(b) This Agreement shall remain in effect for two (2) years from the
Effective Date. This Agreement shall continue thereafter for periods
not exceeding one (1) year if approved at least annually (i) by a vote
of a majority of the outstanding voting securities of each Series or
by a vote of the Board of Directors of the Money Market Fund, and (ii)
by a vote of a majority of the Directors of the Money Market Fund who
are not interested persons or parties to this Agreement (other than as
Directors of the Money Market Fund), cast in person at a meeting
called for the purpose of voting on such approval.

(c) This Agreement (i) may at any time be terminated without the payment
of any penalty, either by a vote of the Directors of the Money Market
Fund or by a vote of a majority of the outstanding voting securities
on sixty (60) days' written notice to Fund/Plan; and (ii) may be
terminated by Fund/Plan on sixty (60) days' written notice to the
Money Market Fund.

(d) This Agreement shall automatically terminate in the event of its
assignment or upon the termination of the Administration Agreement
between Fund/Plan Services, Inc., and the Money Market Fund.

Page 5 of 9
<PAGE>

8. Indemnification of Fund/Plan by IAA Trust.

IAA Trust will indemnify and hold Fund/Plan harmless for the actions of IAA
Trust's employees registered with the NASD as Fund/Plan representatives and
will undertake to maintain compliance with all rules and regulations
concerning any and all sales presentations made by such employees.

9. Liability of Fund/Plan.

(a) Fund/Plan, its directors, officers, employees, shareholders and agents
shall not be liable for any error of judgment or mistake of law or for
any loss suffered by the Money Market Fund in connection with the
performance of this Agreement, except a loss resulting from a breach
of Fund/Plan's obligation pursuant to Section 4 of this Agreement, a
breach of fiduciary duty with respect to the receipt of compensation
for services or a loss resulting from willful misfeasance, bad faith
or negligence on the part of Fund/Plan in the performance of its
obligations and duties or by reason of its reckless disregard of its
obligations and duties under this Agreement.

(b) The Money Market Fund agrees to indemnify and hold harmless Fund/Plan
against any and all liability, loss, damages, costs or expenses
(including reasonable counsel fees) which Fund/Plan may incur or be
required to pay hereafter, in connection with any action, suit or
other proceeding, whether civil or criminal, before any court or
administrative or legislative body, in which Fund/Plan may be involved
as a party or otherwise or with which Fund/Plan may be threatened, by
reason of the offer or sale of the Money Market Fund shares by persons
other than Fund/Plan or its representatives.

(c) Any person, even though also a director, officer, employee,
shareholder or agent of Fund/Plan, who may be or become an officer,
director, trustee, employee or agent of the Money Market Fund, shall
be deemed, when rendering services to the Money Market Fund or acting
on any business of the Money Market Fund (other than services or
business in connection with Fund/Plan's duties hereunder), to be
rendering such services to or acting solely for the Money Market Fund
and not as a director, officer, employee, shareholder or agent, or one
under the control or direction of Fund/Plan even though receiving a
salary from Fund/Plan.

Page 6 of 9
<PAGE>

(d) The Money Market Fund agrees to indemnify and hold harmless Fund/Plan,
and each person, who controls Fund/Plan within the meaning of Section
15 of the Securities Act of 1933, as amended (the "Securities Act"),
or Section 20 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), against any and all losses, claims, damages and
liabilities, joint or several (including any reasonable investigative,
legal and other expenses incurred in connection therewith) to which
they, or any of them, may become subject under the Act, the Securities
Act, the Exchange Act or other federal or state law or regulation, at
common law or otherwise insofar as such losses, claims, damages or
liabilities (or actions, suits or proceedings in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in a prospectus, statement of
additional information, supplement thereto, sales literature or other
written information prepared by the Money Market Fund and furnished by
the Money Market Fund to Fund/Plan for Fund/Plan's use hereunder,
disseminated by the Money Market Fund or arise out of or are based
upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading. Such indemnity shall not, however, inure to
the benefit of Fund/Plan (or any person controlling Fund/Plan) on
account of any losses, claims, damages or liabilities (or actions,
suits or proceedings in respect thereof) arising from the sale of the
shares of the Money Market Fund to any person by Fund/Plan (i) if such
untrue statement or omission or alleged untrue statement or omission
was made in the prospectus, statement of additional information, or
supplement, sales or other literature, in reliance upon and in
conformity with information furnished in writing to the Money Market
Fund by Fund/Plan specifically for use therein or (ii) if such losses,
claims, damages, or liabilities arise out of or are based upon an
untrue statement or omission or alleged untrue statement or omission
found in any prospectus, statement of additional information,
supplement, sales or other literature, subsequently corrected, but,
negligently distributed by Fund/Plan and a copy of the corrected
prospectus was not delivered to such person at or before the
confirmation of the sale to such person.

Underwriter agrees to indemnify and hold harmless the Fund, each
person, if any,

Page 7 of 9
<PAGE>

who controls the Fund within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, insofar as such
losses, claims, damages or liabilities arise out of or are based upon
any untrue statement or omission or alleged untrue statement of a
material fact contained in a Prospectus or Statement of Additional
Information or any supplement thereto, or arise out of or are based
upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, if based upon information furnished to the
Fund by the Underwriter in writing specifically for use therein.

(e) Fund/Plan shall not be responsible for any damages, consequential or
otherwise, which IAA Trust or the Money Market Fund may experience,
due to the disruption of the distribution of Shares caused by any
action arising out of the actions or inactions of any registered
representative or affiliate of Fund/Plan.

10. Amendments.

No provision of this Agreement may be amended or modified, in any manner
whatsoever except by a written agreement properly authorized and executed
by the Parties.

11. Section Headings.

Section and Paragraph headings are for convenience only and shall not be
construed as part of this Agreement.

12. Reports.

Fund/Plan shall prepare reports for the Board of Directors of the Money
Market Fund on a quarterly basis showing such information as from time to
time shall be reasonably requested by such Board.

13. Severability.

If any part, term or provision of this Agreement is held by any court to be
illegal, in conflict with any law or otherwise invalid, the remaining
portion or portions shall be considered severable and not affected, and the
rights and obligations of the parties shall be construed and enforced as if
the Agreement did not contain the particular part, term or provision held
to be illegal or invalid provided that the basic agreement is not thereby
substantially impaired.

Page 8 of 9
<PAGE>

14. Governing Law.

This Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania and the venue of any action arising under this Agreement shall
be Montgomery County, Commonwealth of Pennsylvania.

15. Authority to Execute

The Parties represent and warrant that the execution and delivery of this
Agreement by the undersigned officers of the Parties has been duly and
validly authorized by resolution of the respective Boards of Directors or
each of the Parties.

16. This Agreement may be executed in two or more counterparts, each of which
when so executed shall be deemed to be an original, but such counterparts
shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting of nine typewritten pages to be signed by their duly authorized
officers, as of the day and year first above written.

IAA Trust Company

------------------------------------
By: Gary E. Mede
Vice President

IAA Trust Money Market Fund, Inc.

------------------------------------
By: Richard M. Miller
Vice President
Fund/Plan Broker Services, Inc.

- ------------------------------------
By: Kenneth J. Kempf, President

Page 9 of 9

AMENDMENT TO UNDERWRITING AGREEMENT

This AGREEMENT, dated as of the 29th day of July, 1996 made by and
between IAA Trust Taxable Fixed Income Series Fund, Inc., (the "Fund") (formerly
known as IAA Trust Money Market Fund, Inc.) a corporation duly organized and
existing under the laws of the state of Maryland, operating as a registered
investment company under the Investment Company Act of 1940, as amended, and
Fund/Plan Broker Services, Inc. ("Fund/Plan"), a broker-dealer registered with
the Securities and Exchange Commission and a member of good standing of the
National Association of Securities Dealers, Inc. (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Parties originally entered into an Underwriting Agreement
dated August 1, 1995, (the "Agreement"); and

WHEREAS, the Parties wish to amend the Agreement to provide for the
issuance of separate series of shares for the Fund identified;

NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Parties hereto, intending to be legally bound, do hereby
agree:

1. The name of the Fund has been changed to IAA Trust Taxable Fixed
Income Series Fund, Inc., as set forth on the attached Schedule "A".

2. To the addition of two new series for IAA Trust Taxable Fixed Income
Series Fund, Inc., as set forth on the attached Schedule "A".

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement,
consisting of one type-written page, together with Schedule "A", to be signed by
their duly authorized officers as of the day and year first above written.

IAA Trust Taxable Fixed Income Fund/Plan Broker Services, Inc.
Series Fund, Inc.

- ---------------------------------- ---------------------------------
By: Gary E. Mede, Vice-President By: Kenneth J. Kempf, President

- ---------------------------------- ----------------------------
Attest: Attest:

<PAGE>

SCHEDULE "A"
AS AMENDED ON JULY 29, 1996

IDENTIFICATION OF SERIES

Below are listed the Series to which services under this Agreement are to be
performed as of the execution date of this Agreement:

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
------------------------------------------------

IAA Trust Money Market Series
IAA Trust Short-Term Government Bond Series
IAA Trust Long-Term Bond Series

This Schedule "A" may be amended from time to time by agreement of the parties.

TRANSFER AGENT SERVICES AGREEMENT

This Agreement, dated as of the 1st day of August, 1995, made by and
between IAA Trust Money Market Fund, Inc. (the "Money Market Fund"), a
corporation duly organized and existing under the laws of the state of Maryland
and operating as a registered investment company under the Investment Company
Act of 1940, as amended (the "Act"), and Fund/Plan Services, Inc. ("Fund/Plan"),
a corporation duly organized and existing under the laws of the State of
Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Money Market Fund desires to retain Fund/Plan to perform share
transfer agency, redemption and dividend disbursing services as set forth in
this Agreement and in Schedule "A" attached hereto, and to perform certain other
functions in connection with these duties; and

WHEREAS, Fund/Plan is registered with the Securities and Exchange
Commission as a Transfer Agent as required under Section 17(A)(c) of the
Securities Exchange Act of 1934, as amended; and

WHEREAS, Fund/Plan is willing to serve in such capacity and perform such
functions upon the terms and conditions set forth below.

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for good and valuable consideration, the receipt and
sufficiency is hereby acknowledged, the Parties hereto, intending to be legally
bound, do hereby agree as follows:

Section 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have the meanings
herein specified unless the context otherwise requires.

Share Certificates shall mean the certificates representing shares of stock
of the Money Market Fund.

Shareholders shall mean the registered owners of the Shares of the Money
Market Fund in accordance with the share registry records maintained by
Fund/Plan for the Money Market Fund.

Shares shall mean the issued and outstanding shares of the Money Market
Fund.

Signature Guarantee shall mean the guarantee of signatures by an "eligible
guarantor institution" as defined in rule 17Ad-15 under the Securities Exchange
Act of 1934, as amended. Eligible guarantor institutions include banks, brokers,
dealers, credit unions,

Page 1 of 12 pages.
<PAGE>

national securities exchanges, registered securities associations, clearing
agencies and savings associations. Broker-dealers guaranteeing signatures must
be members of a clearing corporation or maintain net capital of at least
$100,000. Signature guarantees will be accepted from any eligible guarantor
institution which participates in a signature guarantee program.

Oral Instruction shall mean an authorization, instruction, approval, item
or set of data, or information of any kind transmitted to Fund/Plan in person or
by telephone, telegram, telecopy or other mechanical or documentary means
lacking an original signature, by a person or persons reasonably identified to
Fund/Plan to be a person or persons so authorized by a resolution of the Board
of Directors of the Money Market Fund.

Written Instruction shall mean an authorization, instruction, approval,
item or set of data or information of any kind transmitted to Fund/Plan in an
original writing containing an original signature or a copy of such document
transmitted by telecopy including transmission of such signature reasonably
identified to Fund/Plan to be the signature of a person or persons so authorized
by a resolution of the Board of Directors of the Money Market Fund to give
Written Instructions to Fund/Plan.

TRANSFER AGENCY SERVICES

Section 2. The Fund shall furnish to Fund/Plan as Transfer Agent a
sufficient supply of blank Share Certificates and from time to time will renew
such supply upon the request of Fund/Plan. Such blank Share Certificates shall
be signed manually or by facsimile signatures of officers of the Fund authorized
by law or the by-laws of the Fund to sign Share Certificates and, if required,
shall bear the corporate seal or a facsimile thereof.

Section 3. Fund/Plan as Transfer Agent shall make original issues of Shares
in accordance with the terms of this agreement below and with the Money Market
Fund's Prospectus and Statement of Additional Information then in effect, upon
the written request of the Money Market Fund, and upon being furnished with (i)
a certified copy of a resolution or resolutions of the Board of Directors of the
Money Market Fund authorizing such issue; (ii) an opinion of counsel as to the
validity of such Shares; and (iii) necessary funds for the payment of any
original issue tax applicable to such additional Shares.

Section 4. Transfers of Shares shall be registered and new Share
Certificates issued by Fund/Plan upon redemption of outstanding Share
Certificates, (i) in the form deemed by Fund/Plan to be properly endorsed for
transfer, (ii) with all necessary endorser's signatures guaranteed pursuant to
Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended,

Page 2 of 12 pages.
<PAGE>

accompanied by, (iii) such assurances as Fund/Plan shall deem necessary or
appropriate to evidence the genuineness and effectiveness of each necessary
endorsement, and (iv) satisfactory evidence of compliance with all applicable
laws relating to the payment or collection of taxes.

Section 5. When mail is used for delivery of Share Certificates, Fund/Plan
shall forward Share Certificates in "non-negotiable" form by first-class mail,
and Share Certificates in "negotiable" form by registered mail, all mail
deliveries to be covered while in transit to the addressee by insurance arranged
for by Fund/Plan.

Section 6. In registering transfers, Fund/Plan as Transfer Agent may rely
upon the applicable commercial code or any other applicable law which, in the
written opinion (a copy of which shall previously have been furnished to the
Money Market Fund) of counsel, protect Fund/Plan and the Money Market Fund in
not requiring complete documentation, in registering transfer without inquiry
into adverse claims, in delaying registration for purposes of such inquiry, or
in refusing registration where in its judgment an adverse claim requires such
refusal.

Section 7. Fund/Plan as Transfer Agent may issue new Share Certificates in
place of Share Certificates represented to have been lost, destroyed or stolen,
upon receiving indemnity satisfactory to Fund/Plan and may issue new Share
Certificates in exchange for and upon surrender of mutilated Share Certificates.

Section 8. In case any officer of the Fund who shall have signed manually
or whose facsimile signature shall have been affixed to blank Share Certificates
shall die, resign or be removed prior to the issuance of such Share
Certificates, Fund/Plan as Transfer Agent may issue or register such Share
Certificates as the Share Certificates of the Fund notwithstanding such death,
resignation or removal; and the Fund shall file promptly with Fund/Plan such
approval, adoption or ratification as may be required by law.

Section 9. With respect to confirmed trades received by Fund/Plan as
Transfer Agent for the Fund, Fund/Plan shall periodically notify the Fund of the
current status of outstanding confirmed trades. Fund/Plan is authorized to
cancel confirmed trades which have been outstanding for thirty (30) days. Upon
such cancellation, the Transfer Agent shall instruct the Fund Accounting Agent
to adjust the books of the Fund accordingly.

Section 10. Fund/Plan will maintain stock registry records in the usual
form in which

Page 3 of 12 pages.
<PAGE>

it will note the issuance, transfer and redemption of Shares and the issuance
and transfer of Share Certificates, and is also authorized to maintain an
account entitled Unissued Certificate Account in which it will record the Shares
and fractions issued and outstanding from time to time for which issuance of
Share Certificates is deferred. Fund/Plan will provide reports of Fund Share
purchases, redemptions, and total Shares outstanding on the next business day
after each net asset valuation. Fund/Plan is authorized to keep records, which
will be part of the stock transfer records, in which it will note the names and
registered address of Shareholders and the number of Shares and fractions from
time to time owned by them for which no Share Certificates are outstanding. Each
Shareholder will be assigned a single account number even though Shares for
which Certificates have been issued will be accounted for separately.

Section 11. Fund/Plan will issue Share Certificates for Shares of the Fund,
only upon receipt of a written request from a Shareholder. In all other cases,
the Fund authorizes Fund/Plan to dispense with the issuance and countersignature
of Share Certificates whenever Shares are purchased. In such case Fund/Plan as
Transfer Agent, shall merely note on its stock registry records the issuance of
the Shares and fractions (if any), shall credit the Unissued Certificate Account
with the Shares and fractions issued and shall credit the proper number of
Shares and fractions to the respective Shareholders. Likewise, whenever
Fund/Plan has occasion to surrender for redemption Shares and fractions owned by
Shareholders, it shall be unnecessary to issue Share Certificates for redemption
purposes. The Fund authorizes Fund/Plan in such cases to process the
transactions by appropriate entries in its Share transfer records, and debiting
of the Unissued Certificate Account and the record of issued Shares outstanding.

Section 12. Under this Agreement, Fund/Plan shall, in addition to the
duties and functions above-mentioned, perform the usual duties and functions of
a stock transfer agent for an investment company as listed in Schedule "A"
attached hereto. Fund/Plan may rely conclusively and act without further
investigation upon any list, instruction, certification, authorization or other
instrument or paper believed by it in good faith to be genuine and unaltered,
and to have been signed, countersigned, or executed by duly authorized person or
persons, or upon the instructions of any officer of the Money Market Fund, or
upon the advice of counsel for the Money Market Fund or for Fund/Plan. Fund/Plan
may record any transfer of Shares which is reasonably believed by it to have
been duly authorized or may refuse to

Page 4 of 12 pages.
<PAGE>

record any transfer of Shares if in good faith Fund/Plan in its capacity as
Transfer Agent deems such refusal necessary in order to avoid any liability
either of the Money Market Fund or Fund/Plan. The Money Market Fund agrees to
indemnify and hold harmless Fund/Plan from and against any and all losses,
costs, claims, and liability which it may suffer or incur by reason of so
relying or acting or refusing to act. Fund/Plan shall maintain and reconcile all
operating bank accounts necessary to facilitate all transfer agency processes;
including, but not limited to, distribution disbursements, redemptions and
payment clearance accounts.

Section 13. In case of any request or demand for the inspection of the
Share records of the Money Market Fund, Fund/Plan as Transfer Agent shall
endeavor to notify the Money Market Fund and to secure instructions as to
permitting or refusing such inspection. Fund/Plan may, however, exhibit such
records to any person in any case where it is advised by its counsel that it may
be held liable for failure to do so.

Section 14. Fund/Plan acknowledges that all records that it maintains on
behalf of the Money Market Fund are the property of the Money Market Fund and
will be surrendered promptly to the Money Market Fund upon written request.
Fund/Plan will preserve, for the periods prescribed under Rule 31a-2 under the
Act, all such records required to be maintained under Rule 31a-1 of the Act.

ISSUANCE OF SHARES

Section 15. Prior to the daily determination of net asset value in
accordance with the Fund's Prospectus and Statement of Additional Information,
Fund/Plan shall process all purchase orders received since the last
determination of the Fund's net asset value.

Fund/Plan shall calculate on a daily basis the amount available for
investment in Shares at the net asset value determined by the Money Market
Fund's pricing agent as of the close of regular trading on the New York Stock
Exchange, the number of Shares and fractional Shares to be purchased and the net
asset value to be deposited with the custodian of the assets of the Money Market
Fund (the "Custodian"). Fund/Plan shall place a purchase order daily with the
Money Market Fund for the proper number of Shares and fractional Shares to be
purchased and confirm such number to IAA Trust Company, in writing.

Section 16. Fund/Plan having made the calculations provided for in Section
9, shall thereupon pay over the net asset value of Shares purchased to the
Custodian. The proper number of Shares and fractional Shares shall then be
issued daily and credited by Fund/Plan to the Shareholder Registration Records.
The Shares and fractional Shares purchased for each

Page 5 of 12 pages.
<PAGE>

Shareholder will be credited by Fund/Plan to that Shareholder's separate
account. Fund/Plan shall mail to each Shareholder a confirmation of each
purchase with, if requested, copies to the Money Market Fund. Such confirmations
will show the prior Share balance, the new Share balance, the Shares for which
Stock Certificates are outstanding (if any), the amount invested and the price
paid for the newly purchased Shares.

REDEMPTIONS

Section 17. Prior to the daily determination of net asset value in
accordance with the Fund's Prospectus and Statement of Additional Information
then in effect, Fund/Plan shall process all requests from Shareholders to redeem
Shares and determine the number of Shares required to be redeemed to make
monthly payments, automatic payments or the like. Thereupon, Fund/Plan shall
advise the Money Market Fund of the total number of Shares available for
redemption and the number of Shares and fractional Shares requested to be
redeemed. The Money Market Fund's pricing agent shall then determine the
applicable net asset value. Thereafter Fund/Plan shall furnish the Money Market
Fund with an appropriate confirmation of the redemption and process the
redemption by filing with the Custodian an appropriate statement and make the
proper distribution and application of the redemption proceeds in accordance
with the Fund's Prospectus and Statement of Additional Information then in
effect. The stock registry books recording outstanding Shares, the Shareholder
Registration Records and the individual account of the Shareholder shall be
properly debited.

Section 18. The proceeds of redemption shall be remitted by Fund/Plan in
accordance with the Fund's Prospectus and Statement of Additional Information
then in effect, by check mailed to the Shareholder at the Shareholder's
registered address or wired to an authorized bank account. If Share Certificates
have been issued for Shares being redeemed, then such Share Certificates and a
stock power with a signature guarantee of a commercial bank, or a member firm of
a national securities exchange shall accompany the redemption request. If Share
Certificates have not been issued to the redeeming Shareholder, the signature of
the Shareholder on the redemption request must be similarly guaranteed. The Fund
may authorize Fund/Plan to waive signature guarantees.

For the purposes of redemption of Shares which have been purchased within
15 days of a redemption request, the Money Market Fund shall provide Fund/Plan,
from time to time, with Written Instructions concerning the time within which
such requests may be honored.

DIVIDENDS

Page 6 of 12 pages.
<PAGE>

Section 19. The Money Market Fund shall notify Fund/Plan of the date of
each dividend declaration or capital gains distribution and the record date for
determining the Shareholders entitled to payment. The per share payment amount
of any dividend or capital gain shall be determined by the Money Market Fund
after receipt of necessary information from and consultation with Fund/Plan.

Section 20. On or before each payment date, the Money Market Fund will
notify Fund/Plan of the total amount of the dividend or distribution currently
payable. Fund/Plan will, on the designated payment date, automatically reinvest
all dividends in additional Shares except in cases where Shareholders have
elected to receive distribution in cash, in which case Fund/Plan will mail
distribution checks to the Shareholders for the proper amounts payable to them
from monies transferred by The Custodian to Fund/Plan for that purpose.

FEES

Section 21. The Money Market Fund agrees to pay Fund/Plan compensation for
its services and to reimburse it for expenses, at the rates and amounts as set
forth in Schedule "B" attached hereto, and as shall be set forth in any
amendments to such Schedule "B" approved by the Money Market Fund and Fund/Plan.
The Money Market Fund agrees and understands that Fund/Plan's compensation will
be comprised of two components, payable on a monthly basis, as follows:

(i) Subject to a minimum fee, the Money Market Fund agrees to pay
Fund/Plan an annual Shareholder account maintenance fee calculated by
multiplying the monthly average number of accounts in each Fund by one twelfth
(1/12th) the per account fee as stated in Schedule "B". A combined account fee,
subject to a minimum amount, will be billed monthly to the Money Market Fund.
These fees are to be paid by the Money Market Fund within ten calendar days
after receipt of an invoice from Fund/Plan.

(ii) reimbursement of any reasonable out-of-pocket expenses paid by
Fund/Plan on behalf of the Money Market Fund, which out-of-pocket expenses will
be billed to the Money Market Fund within the first ten calendar days of the
month following the month in which such out-of-pocket expenses were incurred.
The Money Market Fund agrees to reimburse Fund/Plan for such expenses within ten
calendar days of receipt of such bill.

For the purpose of determining fees payable to Fund/Plan, the value of the
Money Market Fund's net assets shall be computed at the times and in the manner
specified its

Page 7 of 12 pages.
<PAGE>

Prospectus and Statement of Additional Information then in effect.
During the term of this Agreement, should the Money Market Fund seek services or
functions in addition to those outlined above or in Schedule "A" attached, a
written amendment to this Agreement specifying the additional services and
corresponding compensation shall be executed by both Fund/Plan and the Money
Market Fund.

GENERAL PROVISIONS

Section 22. Fund/Plan shall maintain records (which may be part of the
stock transfer records) in connection with the issuance and redemption of
Shares, and the disbursement of dividends and dividend reinvestments, in which
will be noted the transactions effected for each Shareholder and the number of
Shares and fractional Shares owned by each Shareholder. Fund/Plan agrees to make
available upon request and to preserve for the periods prescribed in Rule 31a-2
under the Investment Company Act of 1940, as amended, any records relating to
services provided under this Agreement which are required to be maintained by
Rule 31a-1 under the Act.

Section 23. In addition to the services as Transfer Agent and dividend
disbursing agent set forth above, Fund/Plan will perform other services for the
Money Market Fund as agreed upon from time to time, including but not limited
to, preparation of and mailing Federal Tax Information Forms, mailing
semi-annual reports of the Money Market Fund, preparation of one annual list of
Shareholders, and mailing notices of shareholders' meetings, proxies and proxy
statements.

Section 24. Nothing contained in this Agreement is intended to or shall
require Fund/Plan in any capacity hereunder, to perform any functions or duties
on any holiday, day of special observance or any other day on which the
Custodian or the New York Stock Exchange are closed. Functions or duties
normally scheduled to be performed on such days shall be performed on, and as
of, the next business day on which both the New York Stock Exchange and the
Custodian are open.

Section 25.

(a) Fund/Plan, its directors, officers, employees, shareholders and
agents shall only be liable for any error of judgment or mistake of law or for
any loss suffered by the Money Market Fund, in connection with the performance
of this Agreement that result from willful misfeasance, bad faith or negligence
on the part of Fund/Plan in the performance of its obligations and duties under
this Agreement.

Page 8 of 12 pages.
<PAGE>

(b) Any person, even though also a director, officer, employee,
shareholder or agent of Fund/Plan, who may be or become an officer, trustee,
employee, or agent of the Money Market Fund, shall be deemed, when rendering
services to such entity or acting on any business of the Money Market Fund,
(other than services or business in connection with Fund/Plan's duties
hereunder), to be rendering such services to or acting solely for the Money
Market Fund and not as a director, officer, employee, shareholder or agent of,
or one under the control or direction of Fund/Plan even though that person is
being paid salary by Fund/Plan.

(c) Notwithstanding any other provision of this Agreement, the Money
Market Fund shall indemnify and hold harmless Fund/Plan, its directors,
officers, employees, shareholders and agents from and against any and all
claims, demands, expenses and liabilities (whether with or without basis in fact
or law) of any and every nature which Fund/Plan may sustain or incur or which
may be asserted against Fund/Plan by any person by reason of, or as a result of
(i) any action taken or omitted to be taken by Fund/Plan in good faith
hereunder; (ii) any action taken or omitted to be taken by Fund/Plan in good
faith in reliance upon any certificate, instrument, order, or stock certificate
or other document reasonably believed by it to be genuine and to be signed,
countersigned or executed by any duly authorized person, upon the Oral
Instructions or Written Instructions of an authorized person of the Money Market
Fund or upon the opinion of legal counsel to the Money Market Fund, or its own
counsel; or (iii) any action taken or omitted to be taken by Fund/Plan in
connection with its appointment under this agreement, which action or omission
was taken in good faith in reliance upon any law, act, regulation or
interpretation of the same even though the same may thereafter have been
altered, changed, amended, or repealed. Indemnification under this subparagraph,
however, shall not apply to actions or omissions of Fund/Plan or its directors,
officers, employees, shareholders, or agents in cases of its or their willful
misfeasance, bad faith, negligence or reckless disregard of its or their duties
hereunder.

(d) Fund/Plan shall give written notice to the Money Market Fund
within ten (10) business days of receipt by Fund/Plan of a written assertion or
claim of any threatened or pending legal proceeding which may be subject to this
indemnification. The failure to notify the Money Market Fund of such written
assertion or claim shall not, however, operate in any manner whatsoever to
relieve the Money Market Fund of any liability arising under this Section or
otherwise, except to the extent that failure to give notice prejudices the Money

Page 9 of 12 pages.
<PAGE>

Market Fund.

(e) For any legal proceeding giving rise to this indemnification, the
Money Market Fund shall be entitled to defend or prosecute any claim in the name
of Fund/Plan at its own expense and through counsel of its own choosing if it
gives written notice to Fund/Plan within ten (10) business days of receiving
notice of such claim. Notwithstanding the foregoing, Fund/Plan may participate
in the litigation at its own expense through counsel of its own choosing. In the
event the Money Market Fund chooses to defend or prosecute such claim, the
parties shall cooperate in the defense or prosecution thereof and shall furnish
such records and other information as are reasonably necessary.

(f) The Money Market Fund shall not settle any claim under Sub Section
(d) and (e) without Fund/Plan's express written consent, which consent shall not
be unreasonably withheld. Fund/Plan shall not settle any such claim without the
Money Market Fund's express written consent, which likewise shall not be
unreasonably withheld.

Section 26. Fund/Plan is authorized, upon receipt of Written Instructions
from the Money Market Fund, to make payment upon redemption of Shares without a
signature guarantee. The Money Market Fund hereby agrees to indemnify and hold
Fund/Plan, its successors and assigns, harmless of and from any and all
expenses, damages, claims, suits, liabilities, actions, demands, losses
whatsoever arising out of or in connection with a payment by Fund/Plan upon
redemption of Shares pursuant to Written Instructions and without a signature
guarantee; upon the request of Fund/Plan, the Money Market Fund shall assume the
entire defense of any action, suit or claim subject to the foregoing indemnity.
Fund/Plan shall notify the Money Market Fund of any such action, suit or claim
within thirty (30) days after receipt by Fund/Plan of notice thereof.

Section 27.

(a) The term of this Agreement shall be for a period of three (3) years,
commencing on the date hereinabove first written (the "Effective Date"), and
shall continue thereafter on a year to year term subject to termination by
either Party set forth in (c) below.

(b) The fee schedule set forth in Schedule "B" attached shall be fixed for
three (3) years commencing on the Effective Date of this Agreement. Such fees
are to be paid by the Fund within ten calendar days of receipt of an invoice
from Fund/Plan after the end of each month.

Page 10 of 12 pages.
<PAGE>

may give written notice to the other of the termination of this Agreement, such
termination to take effect at the time specified in the notice, which date shall
not be less than one hundred twenty (120) days after the date of receipt of such
notice. Upon the effective termination date, the Money Market Fund shall pay to
Fund/Plan such compensation as may be due as of the date of termination and
shall likewise reimburse Fund/Plan for any out-of-pocket expenses and
disbursements reasonably incurred by Fund/Plan to such date.

(d) If a successor to any of Fund/Plan's duties or responsibilities under
this Agreement is designated by the Money Market Fund by written notice to
Fund/Plan in connection with the termination of this Agreement, Fund/Plan shall
promptly upon such termination and at the expense of the Money Market Fund,
transfer all required records and shall cooperate in the transfer of such duties
and responsibilities.

Section 28. The Money Market Fund shall file with Fund/Plan a certified
copy of each resolution of its Board of Directors authorizing the execution of
Written Instructions or the transmittal of Oral Instructions, as provided in
Section 1 of this Agreement.

Section 29. Except as otherwise provided in this Agreement, any notice or
other communication required by or permitted to be given in connection with this
Agreement shall be in writing, and shall be delivered in person or sent by first
class mail, postage prepaid, to the respective parties as follows:

If to the Money Market Fund: If to Fund/Plan:
- ---------------------------- ----------------

IAA Trust Money Market Fund, Inc. Fund/Plan Services, Inc.
808 IAA Drive 2 West Elm Street
Bloomington, IL 61702 Conshohocken, PA 19428
Attention: Richard M. Miller Attention: Kenneth J. Kempf,
Vice President President

Section 30. The Money Market Fund represents and warrants to Fund/Plan that
the execution and delivery of this Agreement by the undersigned officers of the
Money Market Fund has been duly and validly authorized by resolution of the
Board of Directors of the Money Market Fund.

Section 31. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall

Page 11 of 12 pages.
<PAGE>

together constitute but one and the same instrument.

Section 32. This Agreement shall extend to and shall be binding upon the
Parties and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Money Market Fund without the
written consent of Fund/Plan or by Fund/Plan without the written consent of the
Money Market Fund, authorized or approved by a resolution of their respective
Boards of Directors.

Section 33. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania and the venue of any action arising under this
Agreement shall be Montgomery County, Commonwealth of Pennsylvania.

Section 34. No provision of this Agreement may be amended or modified, in
any manner except in writing, properly authorized and executed by Fund/Plan and
the Money Market Fund.

Section 35. If any part, term or provision of this Agreement is held by any
court to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be affected,
and the rights and obligations of the parties shall be construed and enforced as
if the Agreement did not contain the particular part, term or provision held to
be illegal or invalid, provided that the basic agreement is not thereby
substantially impaired.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting in its entirety, of twelve typewritten pages, together with Schedules
"A" and "B", to be signed by their duly authorized officers as of the day and
year first above written.

IAA Trust Money Market Fund, Inc. Fund/Plan Services, Inc.
- --------------------------------- ------------------------

- ------------------------------------ ------------------------------------
By: Gary E. Mede By: Kenneth J. Kempf
Vice President President

Page 12 of 12 pages.
<PAGE>

SCHEDULE "A"

TRANSFER AGENT/SHAREHOLDER SERVICES
FOR
IAA TRUST MONEY MARKET FUND, INC.

The following Transfer Agency Services shall be provided under this agreement:

o Opening new accounts and entering demographic data into shareholder base.

o Real-time Customer Information File (CIF) to link accounts within a Fund
and across all Funds.

o 100% Quality Control of new accounts opened on a same-day/next day basis.

o Account Maintenance

o Processing all investments including:

- initial investments
- subsequent investments through lock box computer interface
- pre-authorized investments through ACH
- government allotments through ACH

o Processing tax ID certifications and Non-Resident Alien (NRA) and reporting
back-up withholding.

o Processing legal transfers of accounts.

o Automated exchange processing.

o Recording and retaining on tape all shareholder calls.

o Research and respond to shareholder calls and written inquiries.

o Generating account statements with copies to appropriate interested
parties. (Up to four statements.)

o Redemption processing includes:

- complete and partial redemptions
- check redemption processing (if applicable)

o Distribution options:

- federal wires*
- mailing checks
- ACH*

o Certificate issuance and cancellation.

Schedule "A", Page 1
<PAGE>

o Replacement of certificates through surety bonds.*

o Process dividends and capital gains distributions.

o Producing daily and monthly reports of shareholder activity.

Daily Reports

Report Number Report Description
------------- ------------------
(no report number) Daily Activity Register
024 Tax Reporting Proof
051 Cash Receipts and Disbursement Proof
053 Daily Share Proof
091 Daily Gain/Loss Report
104 Maintenance Register
044 Transfer/Certificate Register
056 Blue Sky Warning Report
501 New Account Report
038 Money Market Payment & Adjustment Detail
039 Money Market Distribution Proof Report

Monthly Reports

Report Description
------------------

Blue Sky
Certificate Listing
State Sales and Redemption
Monthly Statistical
Account Demographic Analysis
MTD Sales - Demographics by Account Group
Account Analysis by Type

o Preparation of federal tax information forms to include 1099-DIV's,
1099-B's, 1042's, etc. to shareholders with tape to IRS.

o Microfilming and indexing in PC system of all application, correspondence
and other pertinent shareholder documents to provide automated location of
these records.

o Microfilming all checks presented for investment and check redemptions.

o Processing reinvestment of dividends of one fund into another fund.

o Addressing, mailing and tabulation of annual proxy cards (one per year).

o Ad Hoc reports as requested by fund management.*

Schedule "A", Page 2
<PAGE>

o System access by PC dial-up or by dedicated line for IAA initiated calls
only (if applicable).*

o Retirement Plan processing (IRA, SEP, Omnibus Qualified Plans)

- Systematic tracking of current, prior year and rollover contributions
- 5498 tax reporting
- 1099R reporting on distributions
- Processing transfer of assets between custodians
- PC based recalculation of required minimum distributions for IRA SWP's
for shareholders over 59 1/2 years of age.

o Preparation of one annual list of shareholders.

o Prepare shareholder lists, labels, etc.*

o Processing sweep purchases and redemptions for brokerage, bank or other
accounts via tape or transmission.*

* Separate fees will apply for these services

Schedule "A", Page 3
<PAGE>

SCHEDULE "B"

SHAREHOLDER SERVICES AND TRANSFER AGENT FEE SCHEDULE
FOR
IAA TRUST MONEY MARKET FUND, INC.

This Fee Schedule is fixed for a period of three (3) years from the Effective
Date as that term is defined in the Agreement.

I. A) Base Fee

$20.00 per account per year (1/12th payable monthly)
Minimum monthly fee - $2,000

(Upon merger of the $26 Million money common fund, this fee will be
rolled back to $18.00 per account per year)

B) IRA's, 403(b) Plans, Defined Contribution/Benefit Plans:

$12.00 per Account Annual Maintenance Fee

II. Out-of-Pocket Expenses:

The Money Market Fund will reimburse Fund/Plan Services monthly for all
reasonable out-of-pocket expenses, including postage, stationery
(statements), telecommunications (telephone, fax, dedicated 800 line,
on-line access), special reports, transmissions, records retention, tapes,
couriers and any pre-approved travel expenses.

III. Additional Services

Activities of a non-recurring nature including but not limited to fund
consolidations, mergers, acquisitions, reorganizations, the addition or
deletion of a series, and shareholder meetings/proxies are not included
herein, and will be quoted separately. To the extent the Money Market Fund
should decide to issue multiple/separate classes of shares, additional fees
will apply. Any enhanced services, programming requests or reports will be
quoted upon request.

Schedule "B"

AMENDMENT TO TRANSFER AGENT SERVICES AGREEMENT

This AGREEMENT, dated as of the 29th day of July, 1996 made by and
between IAA Trust Taxable Fixed Income Series Fund, Inc., (the "Fund") (formerly
known as IAA Trust Money Market Fund, Inc.) a corporation duly organized and
existing under the laws of the state of Maryland, operating as a registered
investment company under the Investment Company Act of 1940, as amended, and
Fund/Plan Services, Inc., ("Fund/Plan") a corporation duly organized and
existing under the laws of the State of Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Parties originally entered into a Transfer Agent Services
Agreement dated August 1, 1995 (the "Agreement"); and

WHEREAS, the Parties wish to amend the Agreement to provide for the
issuance of separate series of shares for the Fund identified;

NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Parties hereto, intending to be legally bound, do hereby
agree:

1. The name of the Fund has been changed to IAA Trust Taxable Fixed
Income Series Fund, Inc., as set forth on the attached Schedule "C";
and

2. To the addition of two new series for IAA Trust Taxable Fixed Income
Series Fund, Inc., as set forth on the attached Schedule "C".

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement,
consisting of one type-written page, together with Schedule "C", to be signed by
their duly authorized officers as of the day and year first above written.

IAA Trust Taxable Fixed Income Fund/Plan Services, Inc.
Series Fund, Inc.

- ------------------------------------- -----------------------------------
By: Gary E. Mede, Vice-President By: Kenneth J. Kempf, President

- -------------------------------------- -----------------------------------
Attest: Attest:

<PAGE>

SCHEDULE "C"
AS AMENDED ON JULY 29, 1996

IDENTIFICATION OF SERIES

Below are listed the Series to which services under this Agreement are to be
performed as of the execution date of this Agreement:

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
------------------------------------------------

IAA Trust Money Market Series
IAA Trust Short-Term Government Bond Series
IAA Trust Long-Term Bond Series

This Schedule "C" may be amended from time to time by agreement of the parties.

ADMINISTRATION AGREEMENT

This Agreement, dated as of the 1st day of August, 1995, made by and
between IAA Trust Money Market Fund, Inc. ("the Money Market Fund"), a
corporation duly organized and existing under the laws of the state of Maryland,
operating as a registered investment company under the Investment Company Act of
1940, as amended (the "Act"), and Fund/Plan Services, Inc. ("Fund/Plan"), a
corporation duly organized and existing under the laws of the State of Delaware
(collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Parties desire to enter into an agreement whereby Fund/Plan
will provide certain administration services to the Money Market Fund on the
terms and conditions set forth in this Agreement; and

WHEREAS, Fund/Plan is willing to serve in such capacity and perform such
administrative services under the terms and conditions set forth below; and

WHEREAS, the Money Market Fund will provide all necessary information to
Fund/Plan concerning the Fund so that Fund/Plan may appropriately execute its
responsibilities hereunder;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and in exchange of good and valuable consideration, the
sufficiency and receipt of which is hereby acknowledged, the Parties hereto,
intending to be legally bound, do hereby agree as follows:

Section 1. Appointment The Money Market Fund hereby appoints Fund/Plan as
administrator and Fund/Plan hereby accepts such appointment.

Section 2. Duties and Obligations of Fund/Plan

(a) Subject to the succeeding provisions of this section and subject
to the direction and control of the Board of Directors of the Money Market Fund,
Fund/Plan shall provide to the Fund all administrative services as set forth in
Schedule "A" attached hereto and incorporated by reference in its entirety into
this Agreement. In addition to the obligations set forth in Schedule "A",
Fund/Plan shall (i) provide its own office space, facilities, equipment and
personnel for the performance of its duties under this Agreement; and (ii) take
all actions it deems necessary to properly execute the administrative
responsibilities of the Money Market Fund.

Page 1 of 7 pages.
<PAGE>

(b) So that Fund/Plan may perform its duties under the terms of this
Agreement, the Board of Directors of the Money Market Fund shall direct the
officers, investment advisor, distributor, legal counsel, independent
accountants and custodian of the Money Market Fund to cooperate fully with
Fund/Plan and to provide such information, documents and advice relating to the
Money Market Fund as is within the possession or knowledge of such persons
provided that no such person need provide any information to Fund/Plan if to do
so would result in the loss of any privilege or confidential treatment with
respect to such information. In connection with its duties, Fund/Plan shall be
entitled to rely, and shall be held harmless by the Money Market Fund when
acting in reasonable reliance upon the instruction, advice or any documents as
provided by the Money Market Fund to Fund/Plan by any of the aforementioned
persons. All fees charged by any such persons shall be deemed an expense of the
Money Market Fund.

(1) the provisions of the Investment Company Act of 1940, as amended
(the "Act") and the Securities Act of 1933, as amended, and of any rules or
regulations in force thereunder;

(2) any other applicable provision of state and federal law;

(3) the provisions of the Articles of Incorporation and By-Laws of the
Money Market Fund as amended from time to time;

(4) any policies and determinations of the Board of Directors of the
Money Market Fund; and

(5) the fundamental policies of the Money Market Fund as reflected in
the registration statement under the Act.

Fund/Plan acknowledges that all records that it maintains for the Money
Market Fund are the property of the Money Market Fund and will be surrendered
promptly to the Money Market Fund upon written request. Fund/Plan will preserve,
for the periods prescribed under Rule 31a-2 under the Act, all such records
required to be maintained under Rule 31a-1 of the Act.

(d) Nothing in this Agreement shall prevent Fund/Plan or any officer
thereof from acting as administrator for or with any other person, firm or
corporation. While the

Page 2 of 7 pages.
<PAGE>

administrative services supplied to the Money Market Fund may be different than
those supplied to other persons, firms or corporations, Fund/Plan shall provide
the Money Market Fund equitable treatment in supplying services. The Money
Market Fund recognizes that it will not receive preferential treatment from
Fund/Plan as compared with the treatment provided to other Fund/Plan clients.
Fund/Plan agrees to maintain the records and all other information of the Money
Market Fund in a confidential manner and shall not use such information for any
purpose other than the performance of Fund/Plan's duties under this Agreement.

Section 3. Allocation of Expenses All costs and expenses of the Money
Market Fund shall be paid by the Money Market Fund including, but not limited
to:

(a) fees paid to an investment adviser (the "Adviser");
(b) interest and taxes;
(c) brokerage fees and commissions;
(d) insurance premiums;
(e) compensation and expenses of its Directors who are not affiliated
persons of the Adviser;
(f) legal, accounting and audit expenses;
(g) custodian and transfer agent, or shareholder servicing agent,
fees and expenses;
(h) fees and expenses incident to the registration of the shares of
the Money Market Fund under Federal or state securities laws;
(i) expenses related to preparing, setting in type, printing and
mailing prospectuses, statements of additional information,
reports and notices and proxy material to shareholders of the
Money Market Fund;
(j) all expenses incidental to holding meetings of shareholders and
Directors of the Money Market Fund;
(k) such extraordinary expenses as may arise, including litigation,
affecting the Money Market Fund and the legal obligations which
the Money Market Fund may have regarding indemnification of its
officers and directors; and
(l) fees and out-of-pocket expenses paid on behalf of the Money
Market Fund by Fund/Plan.

Section 4. Compensation of Fund/Plan The Money Market Fund agrees to pay
Fund/Plan compensation for its services and to reimburse it for expenses
incurred and paid by Fund/Plan on behalf of the Money Market Fund, at the rates
and amounts as set forth in Schedule "B" attached hereto, and as shall be set
forth in any amendments to such Schedule "B" approved by the Money Market Fund
and Fund/Plan. The Money Market Fund agrees and understands that Fund/Plan's
compensation be comprised of two components, payable on a

Page 3 of 7 pages.
<PAGE>

monthly basis, as follows:

(i) A combined asset-based fee subject to a minimum amount will be billed
monthly to the Money Market Fund. These fees are to be paid by the Money Market
Fund within ten calendar days after receipt of an invoice from Fund/Plan.

(ii) reimbursement of any out-of-pocket expenses paid by Fund/Plan on
behalf of the Money Market Fund, which out-of-pocket expenses will be billed to
the Money Market Fund within the first ten calendar days of the month following
the month in which such out-of-pocket expenses were incurred. The Money Market
Fund agrees to reimburse Fund/Plan for such expenses within ten calendar days of
receipt of such bill.

For the purpose of determining fees payable to Fund/Plan, the value of the
Money Market Fund's net assets shall be computed at the times and in the manner
specified in the Money Market Fund's Prospectus and Statement of Additional
Information then in effect.

During the term of this Agreement, should the Money Market Fund seek
services or functions in addition to those outlined above or in Schedule "A"
attached, a written amendment to this Agreement specifying the additional
services and corresponding compensation shall be executed by both Fund/Plan and
the Money Market Fund.

Section 5. Duration

(a) The term of this Agreement shall be for a period of three (3) years,
commencing on the date hereinabove first written ("Effective Date") and shall
continue thereafter on a year to year term subject to termination by either
Party set forth in (c) below.

(b) The fee schedule set forth in Schedule "B" attached shall be fixed for
three (3) years commencing on the Effective Date of this Agreement.

(c) After the initial term of this Agreement, the Money Market Fund or
Fund/Plan may give written notice to the other of the termination of this
Agreement, such termination to take effect at the time specified in the notice,
which date shall not be less than one hundred twenty (120) days after the date
of receipt of such notice. Upon the effective termination date, the Money Market
Fund shall pay to Fund/Plan such compensation as may be due as of the date of
termination and shall likewise reimburse Fund/Plan for any out-of-pocket
expenses and disbursements reasonably incurred by Fund/Plan to such date.

(d) If a successor to any of Fund/Plan's duties or responsibilities under
this Agreement is designated by the Money Market Fund by written notice to
Fund/Plan in

Page 4 of 7 pages.
<PAGE>

connection with the termination of this Agreement, Fund/Plan shall promptly upon
such termination and at the expense of the Money Market Fund, transfer all
required records and shall cooperate in the transfer of such duties and
responsibilities.

Section 6. Amendment No provision of this Agreement may be amended or
modified, in any manner except by a written agreement properly authorized and
executed by Fund/Plan and the Money Market Fund.

Section 7. Applicable Law This Agreement shall be governed by the laws of
the Commonwealth of Pennsylvania and the venue of any action arising under this
Agreement shall be Montgomery County, Commonwealth of Pennsylvania.

Section 8. Limitation of Liability

(a) The execution and delivery of this Agreement has been duly authorized
by the Board of Directors of the Money Market Fund and executed on behalf of the
Money Market Fund by the undersigned officer, in that officer's capacity as an
officer of the Money Market Fund. The obligations under this Agreement shall be
binding upon the assets and property of the Money Market Fund and shall not be
binding upon any director, officer or shareholder of the Fund individually.

(b) Fund/Plan, its directors, officers, employees, shareholders and agents
shall only be liable for any error of judgment or mistake of law or for any loss
suffered by the Money Market Fund in connection with the performance of this
Agreement that result from willful misfeasance, bad faith or negligence on the
part of Fund/Plan in the performance of its obligations and duties under this
Agreement.

(c) Any person, even though a director, officer, employee, shareholder or
agent of Fund/Plan, who may be or become an officer, director, employee or agent
of the Money Market Fund, shall be deemed when rendering services to such entity
or acting on any business of such entity (other than services or business in
connection with Fund/Plan's duties under the Agreement), to be rendering such
services to or acting solely for the Money Market Fund and not as a director,
officer, employee, shareholder or agent of, or under the control or direction of
Fund/Plan even though such person may receive compensation from Fund/Plan.

(d) Notwithstanding any other provision of this Agreement, the Money Market
Fund shall indemnify and hold harmless Fund/Plan, its directors, officers,
employees, shareholders and agents from and against any and all claims, demands,
expenses and liabilities

Page 5 of 7 pages.
<PAGE>

(whether with or without basis in fact or law) of any and every nature which
Fund/Plan may sustain or incur or which may be asserted against Fund/Plan by any
person by reason of, or as a result of (i) any action taken or omitted to be
taken by Fund/Plan in good faith, (ii) any action taken or omitted to be taken
by Fund/Plan in good faith in reliance upon any certificate, instrument, order
or stock certificate or other document reasonably believed by Fund/Plan to be
genuine and to be signed, countersigned or executed by any duly authorized
person, upon the oral instructions or written instruction of an authorized
person of the Money Market Fund or upon the opinion of legal counsel for the
Money Market Fund; or (iii) any action taken in good faith or omitted to be
taken by Fund/Plan in connection with its appointment in reliance upon any law,
act, regulation or interpretation of the same even though the same may
thereafter have been altered, changed, amended or repealed. Indemnification
under this subparagraph shall not apply, however, to actions or omissions of
Fund/Plan or its directors, officers, employees, shareholders or agents in cases
of its or their willful misfeasance, bad faith, negligence or reckless disregard
of its or their duties hereunder.

(e) Fund/Plan shall give written notice to the Money Market Fund within ten
(10) business days of receipt by Fund/Plan of a written assertion or claim of
any threatened or pending legal proceeding which may be subject to this
indemnification. The failure to notify the Money Market Fund of such written
assertion or claim shall not, however, operate in any manner whatsoever to
relieve the Money Market Fund of any liability arising under this Section or
otherwise, unless such failure prejudices the Money Market Fund.

(f) For any legal proceeding giving rise to this indemnification, the Money
Market Fund shall be entitled to defend or prosecute any claim in the name of
Fund/Plan at its own expense and through counsel of its own choosing if it gives
written notice to Fund/Plan within ten (10) business days of receiving notice of
such claim. Notwithstanding the foregoing, Fund/Plan may participate in the
litigation at its own expense through counsel of its own choosing. If the Money
Market Fund does choose to defend or prosecute such claim, then the parties
shall cooperate in the defense or prosecution thereof and shall furnish such
records and other information as are reasonably necessary.

(g) The terms of this Section 8 shall survive the termination of this
Agreement.

Section 9. Notices Except as otherwise provided in this Agreement, any
notice or other communication required by or permitted to be given in connection
with this

Page 6 of 7 pages.
<PAGE>

Agreement shall be in writing, and shall be delivered in person or sent by first
class mail, postage prepaid to the respective parties as follows:

If to IAA Trust Money Market Fund, Inc.: If to Fund/Plan:
- ---------------------------------------- ----------------
IAA Trust Money Market Fund, Inc. Fund/Plan Services, Inc.
808 IAA Drive 2 West Elm Street
Bloomington, IL 61702 Conshohocken, PA 19428
Attention: Richard M. Miller Attention: Kenneth J. Kempf,
Vice President President

Section 10. Severability If any part, term or provision of this Agreement
is held by any court to be illegal, in conflict with any law or otherwise
invalid, the remaining portion or portions shall be considered severable and not
affected, and the rights and obligations of the parties shall be construed and
enforced as if the Agreement did not contain the particular part, term or
provision held to be illegal or invalid.

Section 11. Section Headings Section and Paragraph headings are for
convenience only and shall not be construed as part of this Agreement.

Section 12. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting of seven typewritten pages, together with Schedules "A" and "B" to be
signed by their duly authorized officers as of the day and year first above
written.

IAA Trust Money Market Fund, Inc. Fund/Plan Services, Inc.
- --------------------------------- ------------------------

- ------------------------------------ ------------------------------------
By: Gary E. Mede, Vice President By: Kenneth J. Kempf, President

Page 7 of 7 pages.
<PAGE>

SCHEDULE "A"

FUND ADMINISTRATION SERVICES
FOR
IAA TRUST MONEY MARKET FUND, INC.

I. Regulatory Compliance

A. Compliance - Federal Investment Company Act of 1940
1. Review, report and renew

a. Investment advisory contracts
b. Fidelity bond (if requested)
c. Underwriting contracts
d. Distribution (12b-1) plans
e. Administration contracts
f. Accounting contracts
g. Custody contracts
h. Transfer agent and shareholder services contract

2. Filings
a. N-SAR (semi-annual report)
b. N-1A (prospectus), post effective amendments and supplements
("stickers")
c. 24f-2 indefinite registration of shares
d. Filing shareholder reports under 30b2-1
e. Notify frequency capital gains under 19b-1
f. Coordination of EDGAR filings

3. Annual up-dates of biographical information and questionnaires
for Directors and Officers (if requested)

4. Monitor money market funds under Rule 2A-7

B. Compliance - State "Blue Sky"
Blue Sky (state registration)
a. Registration shares (initial/renewal)
b. Monitor sale shares over/under
c. Report shares sold
d. Filing of federal prospectus and contracts
e. Filing annual and semi-annual reports with states

C. Compliance - Prospectus
1. Analyze and review portfolio reports from advisor regarding:
a. compliance with investment objectives
b. maximum investment by company/industry size

Schedule "A": Page 1
<PAGE>

D. Compliance - Other
1. Applicable state tax laws

II. Corporate Business and Shareholder/Public Information

A. Directors/Management
1. Preparation of meetings
a. Agendas - all necessary items of compliance
b. Preparation of Board packages
c. Assist with arranging and conducting meetings
d. Prepare minutes (if requested)
e. Keep attendance records (if requested)
f. Maintain certain board records as requested

2. Preparation and distribution of periodic operation reports to
management

B. Coordinate Proposals for Service Agents
1. Suppliers
2. Printers
3. Fulfillment of literature requests
4. Underwriters

C. Maintain Corporate Calendars
1. General
2. Blue sky

D. Shareholder Meeting - maximum one per year
1. Preparation of Proxy
2. Conduct Meeting
3. Record ballot and results

E. Maintain certain Corporate Files as requested

F. Release Corporate Information
1. To shareholders
2. To financial and general press
3. To industry publications
a. distributions (dividends and capital gains)
b. tax information
c. changes to prospectus
d. letters from management
e. funds' performance

4. Respond to:
a. financial press
b. miscellaneous shareholder inquiries

Schedule "A": Page 2
<PAGE>

c. industry questionnaires
5. Prepare, maintain and update monthly information manual

F. Communications to Shareholders
1. Coordinate printing and distribution of annual and semi-annual
reports and prospectus

III. Financial and Management Reporting

A. Income and Expenses
1. Expense figures calculated and accrual levels set
2. Monitoring of expenses, accruals monthly
3. Approve and coordinate payment of expenses
4. Projection of income and expenses (with regards to B(2)) -
ex-date will determine if projection will apply
5. Calculation of advisory fee, 12b-1 fee
6. Calculation of average net assets

B. Distributions to Shareholders
1. Calculations of dividends and capital gain distributions (in
conjunction with the Fund and their auditors)
a. compliance with income tax provisions
b. compliance with excise tax provisions
c. compliance with Investment Company Act of 1940

C. Financial Reporting
1. Liaison between Fund management, independent auditors and
printers for shareholder reports
2. Preparation of semi-annual and annual reports to shareholders
3. 60-day delivery to SEC and shareholders
4. Preparation of semi-annual and annual NSAR's (financial data)

D. Subchapter M Compliance (monthly)

1. Asset diversification test
2. Short/short test
3. Income Qualification Test

E. Other Financial Analyses

1. Upon request from fund management, other budgeting and analyses
can be constructed to meet a fund's specific needs (additional
fees may apply)
2. Sales information, portfolio turnover (monthly)
3. Work closely with independent auditors on return of capital
presentation, excise tax calculation
4. Performance (total return) calculation (monthly)

Schedule "A": Page 3
<PAGE>

5. Analysis of interest derived from various Government obligations
(annual)(if interest income was distributed in a calendar year)
for reporting to Shareholders

F. Review and Monitoring Functions (monthly)
1. Review expense and reclassification entries to ensure proper
update
2. Perform various reviews to ensure accuracy of
subscription/liquidation schedules, accounting (the monthly
expense analysis)
3. Review all accruals and expenditures where applicable

G. Preparation and distribution of monthly operational reports to
management by 10th Business Day
1. Management Statistics (Recap)
- portfolio
- book gains/losses/per share
- net income, book income per share
- capital stock activity
- distributions

2. Performance Analysis
- total return
- monthly, year to date, average annual (1, 5, 10 yrs), 5 yr
cumulative, since inception cumulative

3. Expense Analysis
- schedule
- expenses paid
- accrual monitoring
- advisory fee

4. Short-Short Analysis
- short-short income
- gross income (components)

5. Portfolio Turnover
- cost of purchases
- net proceeds of sales
- average market value

6. Asset Diversification Test
- gross assets
- non-qualifying assets

7. Activity Summary
- shares sold, redeemed and reinvested
- change in investment

8. Summary of Dividends paid for each Fund.

H. Provide rating agencies statistical data as requested
(monthly/quarterly)

Schedule "A": Page 4
<PAGE>

I. Standard schedules for Board Package (quarterly)
1. Activity Summary (III-G-7 from above)
2. Other schedules can be provided (additional fees may apply)
3. Statistical Report

Schedule "A": Page 5
<PAGE>

SCHEDULE "B"

ADMINISTRATION SERVICES FEE SCHEDULE
FOR
IAA TRUST MONEY MARKET FUND, INC.

This Fee Schedule is fixed for a period of three (3) years from the Effective
Date as that term is defined in the Agreement.

I. Administration Expense

.0015 On the First $ 50 Million of Average Net Assets
.0010 On the Next $ 50 Million of Average Net Assets
.0005 Over $100 Million of Average Net Assets

The above fee schedule is applicable to total net assets of all four
portfolios within the IAA Trust family of Funds. A minimum annual fee of
$50,000 will be charged to the Growth Fund and a minimum annual fee of
$80,000 applies in total to the group of four IAA Trust Funds. New
Portfolios added shall bear an annual minimum fee of $10,000.

II. Out-of-Pocket Expenses

The Fund(s) will reimburse Fund/Plan Services monthly for all reasonable
out-of-pocket expenses, including telephone, postage,
telecommunications, special reports, all currently required tax return
preparation ($3500 per year, total all Funds), record retention, script
fees, stamp duty, special transportation costs as incurred, and copying
and sending materials to auditors.

III. Additional Services

Activities of a non-recurring nature including but not limited to fund
consolidations, mergers, acquisitions, reorganizations, the addition or
deletion of a fund, and shareholder meetings/proxies, are not included
herein, and will be quoted separately. To the extent the Money Market
Fund should decide to issue multiple/separate classes of shares,
additional fees will apply. Any additional/enhanced services or reports
will be quoted upon request.

Schedule "B"

AMENDMENT TO ADMINISTRATION AGREEMENT

This AGREEMENT, dated as of the 29th day of July, 1996 made by and
between IAA Trust Taxable Fixed Income Series Fund, Inc., (the "Fund") (formerly
known as IAA Trust Money Market Fund, Inc.) a corporation duly organized and
existing under the laws of the state of Maryland, operating as a registered
investment company under the Investment Company Act of 1940, as amended, and
Fund/Plan Services, Inc., ("Fund/Plan") a corporation duly organized and
existing under the laws of the State of Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Parties originally entered into an Administration Agreement
dated August 1, 1995, wherein Fund/Plan agreed to provide certain administrative
services to each Series of the Fund (the "Agreement"); and

WHEREAS, the Parties wish to amend the Agreement to provide for the
issuance of separate series of shares for the Fund identified;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Parties hereto, intending to be legally bound, do hereby
agree:

1. The name of the Fund has been changed to IAA Trust Taxable Fixed
Income Series Fund, Inc., as set forth on the attached Schedule "C".

2. To the addition of two new series for IAA Trust Taxable Fixed Income
Series Fund, Inc. as set forth on the attached Schedule "C".

IAA Trust Taxable Fixed Income Fund/Plan Services, Inc.
Series Fund, Inc.

- ------------------------------------ ---------------------------------
By: Gary E. Mede, Vice-President By: Kenneth J. Kempf, President

- ------------------------------------ ---------------------------------
Attest: Attest:

<PAGE>

SCHEDULE "C"
AS AMENDED ON JULY 29, 1996

IDENTIFICATION OF SERIES

Below are listed the Series to which services under this Agreement are to be
performed as of the execution date of this Agreement:

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
------------------------------------------------

IAA Trust Money Market Series
IAA Trust Short-Term Government Bond Series
IAA Trust Long-Term Bond Series

This Schedule "C" may be amended from time to time by agreement of the parties.

ACCOUNTING SERVICES AGREEMENT

This Agreement, dated as of the 1st day of August, 1995 made by and
between IAA Trust Money Market Fund, Inc. (the "Money Market Fund"), a
corporation duly organized and existing under the laws of the State of Maryland
and operating as an open-end management investment company registered under the
Investment Company Act of 1940, as amended, and Fund/Plan Services, Inc.
("Fund/Plan"), a corporation duly organized and existing under the laws of the
State of Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Money Market Fund desires to appoint Fund/Plan as Accounting
Services Agent to maintain and keep current the books, accounts, records,
journals or other records of original entry relating to the business of the
Money Market Fund (the "Accounts and Records") and to perform certain other
functions in connection with such Accounts and Records; and

WHEREAS, Fund/Plan is willing to serve in such capacity and perform such
functions upon the terms and conditions set forth below; and

WHEREAS, the Money Market Fund will provide all necessary information
concerning the Fund to Fund/Plan so that Fund/Plan may appropriately execute its
responsibilities hereunder;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and in exchange of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties hereto,
intending to be legally bound, do hereby agree as follows:

Section 1. For purposes of this Agreement:

Oral Instructions shall mean an authorization, instruction, approval, item
or set of data, or information of any kind transmitted to Fund/Plan in person or
by telephone, telegram, telecopy, or other mechanical or documentary means
lacking an original signature, by a person or persons reasonably identified to
Fund/Plan to be a person or persons authorized by a resolution of the Board of
Directors of the Money Market Fund, to give such Oral Instructions on behalf of
the Money Market Fund.

Written Instructions shall mean an authorization, instruction, approval,
item or set of data or information of any kind transmitted to Fund/Plan in
original writing containing an

Page 1 of 11 pages.
<PAGE>

original signature or a copy of such document transmitted by telecopy including
transmission of such signature reasonably identified to Fund/Plan to be the
signature of a person authorized by a resolution of the Board of Directors of
the Money Market Fund to give written instructions on behalf of the Money Market
Fund.

The Money Market Fund shall file with Fund/Plan a certified copy of each
resolution of its Board of Directors authorizing execution of Written
Instructions or the transmittal of Oral Instructions as provided above.

Section 2. To the extent Fund/Plan receives the necessary information from
the Money Market Fund or its agents by Written or Oral Instructions, Fund/Plan
shall maintain and keep current the following Accounts and Records relating to
the business of the Money Market Fund in such form as may be mutually agreed
upon between the Money Market Fund and Fund/Plan:

(a) Cash Receipts Journal
(b) Cash Disbursements Journal
(c) Dividends Paid and Payable Schedule
(d) Purchase and Sales Journals - Portfolio Securities
(e) Subscription and Redemption Journals
(f) Security Ledgers - Transaction Report and Tax Lot Holdings Report
(g) Broker Ledger - Commission Report
(h) Daily Expense Accruals
(i) Daily Interest Accruals
(j) Daily Trial Balance
(k) Portfolio Interest Receivable and Income Journal
(l) Portfolio Dividend Receivable and Income Register
(m) Listing of Portfolio Holdings - showing cost, market value and
percentage of portfolio comprised of each security.
(n) Average Daily Net assets provided on monthly basis.

The necessary information to perform the above functions and the
calculation of the net asset value of the Money Market Fund as provided below,
is to be furnished by Written or Oral Instructions to Fund/Plan daily (in
accordance with the time frame identified below) prior to the close of regular
trading on the New York Stock Exchange.

Section 3. Fund/Plan shall perform the ministerial calculations necessary
to calculate the Money Market Fund's net asset value each day that the New York
Stock Exchange is open for business, in accordance with (i) the Fund's current
prospectus and statement of additional information then in effect and (ii)
procedures with respect thereto approved by the Board of Directors of the Money
Market Fund and supplied in writing to Fund/Plan. Portfolio items

Page 2 of 11 pages.
<PAGE>

for which market quotations are available by Fund/Plan's use of an automated
financial information service (the "Service") shall be based on the closing
prices of such Service except where the Money Market Fund has given or caused to
be given specific Written or Oral Instructions to utilize a different value
subject to the appropriate provisions in the Money Market Fund's prospectus and
statement of additional information then in effect. All of the portfolio
securities shall be given such values as the Money Market Fund provides by
Written or Oral Instructions including all restricted securities and other
securities requiring valuation not readily ascertainable solely by such Service
subject to the appropriate provisions in the Money Market Fund's prospectus and
statement of additional information then in effect. Fund/Plan shall have no
responsibility or liability for the accuracy of prices quoted by such Service;
for the accuracy of the information supplied by the Money Market Fund; or for
any loss, liability, damage, or cost arising out of any inaccuracy of such data.
Fund/Plan shall have no responsibility or duty to include information or
valuations to be provided by the Money Market Fund in any computation unless and
until it is timely supplied to Fund/Plan in usable form. Fund/Plan shall record
corporate action information as received from the custodian of the Money Market
Fund's assets (the "Custodian"), the Service, or the Money Market Fund.
Fund/Plan shall have no duty to gather or record corporate action information
not supplied by these sources.

Fund/Plan will assume no liability for price changes caused by: the
investment advisor(s), custodian of the assets of the Money Market Fund (the
"Custodian") and suppliers of security prices, corporate action and dividend
information, or any party other than Fund/Plan itself.

In the event an error is made by Fund/Plan which creates a price change of
an amount greater than or equal to one half of one percent of the correct net
asset value ("NAV"), consideration must be given to the effect of the price
change as described below.

Notwithstanding the provisions of Section 11, the following provisions
govern Fund/Plan's liability for errors in calculating the NAV of the Money
Market Fund:

If the NAV should have been higher for a date or dates in the past,
the error would have the effect of having given more shares to subscribers
and less money to redeemers to which they were entitled. Conversely, if
the NAV should have been lower, the error would have the effect of having
given less

Page 3 of 11 pages.
<PAGE>

shares to subscribers and overpaying redeemers.

If the error affects the prior business day's NAV only, and if
Fund/Plan can rerun the prior day's work before shareholder statements and
checks are mailed, the Money Market Fund hereby accepts this manner of
correcting the error.

If the error spans five (5) business days or less, Fund/Plan shall
reprocess shareholder purchases and redemptions where redeeming
shareholders have been underpaid. Fund/Plan shall assume liability to the
Money Market Fund for overpayments to shareholders who have fully
redeemed.

If the error spans more than five (5) business days, Fund/Plan would
bear the liability to the Money Market Fund for, 1) buying in for excess
shares given to shareholders if the NAV should have been higher, or, 2)
funding overpayments to shareholders who have redeemed if the NAV should
have been lower. The cost of any reprocessing required for shareholders
who have been credited with fewer shares than appropriate, or for
redeeming shareholders who are due additional amounts of money will also
be borne by Fund/Plan.

Section 4. For all purposes under this Agreement, Fund/Plan is authorized
to act upon receipt of the first of any Written or Oral Instruction it receives
from the Money Market Fund or its agents on behalf of the Money Market Fund. In
cases where the first instruction is an Oral Instruction that is not in the form
of a document or written record, a confirmatory Written Instruction or Oral
Instruction in the form of a document or written record shall be delivered, and
in cases where Fund/Plan receives an Instruction, whether Written or Oral, to
enter a portfolio transaction on the records, the Money Market Fund shall cause
the broker/dealer to send a written confirmation to the Custodian. Fund/Plan
shall be entitled to rely on the first Instruction received, and for any act or
omission undertaken in compliance therewith shall be free of liability and fully
indemnified and held harmless by the Money Market Fund, provided however, that
in the event a Written or Oral Instruction received by Fund/Plan is
countermanded by a timely received subsequent Written or Oral Instruction prior
to acting upon such countermanded Instruction, Fund/Plan shall act upon such
subsequent Written or Oral Instruction. The sole obligation of Fund/Plan with
respect to any follow-up or confirmatory Written Instruction, Oral Instruction
in documentary or written form, shall be to

Page 4 of 11 pages.
<PAGE>

make reasonable efforts to detect any such discrepancy between the original
Instruction and such confirmation and to report such discrepancy to the Money
Market Fund. The Money Market Fund shall be responsible, at the Money Market
Fund's expense, for taking any action, including any reprocessing, necessary to
correct any discrepancy or error. To the extent such action requires Fund/Plan
to act, the Money Market Fund shall give Fund/Plan specific Written Instruction
as to the action required.

Section 5. The Money Market Fund shall cause its Custodian to forward to
Fund/Plan a daily statement of cash and portfolio transactions. At the end of
each month, the Money Market Fund shall cause the Custodian to forward to
Fund/Plan a monthly statement of portfolio positions, which will be reconciled
with the Money Market Fund's Accounts and Records maintained by Fund/Plan on its
behalf. Fund/Plan will report any discrepancies to the Custodian, and report any
unreconciled items to the Money Market Fund.

Section 6. Fund/Plan shall promptly supply daily and periodic reports to
the Money Market Fund as requested by the Money Market Fund and agreed upon by
Fund/Plan.

Section 7. The Money Market Fund shall provide and shall require each of
its agents (including the Custodian) to provide Fund/Plan as of the close of
each business day, or on such other schedule as the Money Market Fund determines
is necessary, with Written or Oral Instructions (to be delivered to Fund/Plan by
11:00 a.m., Eastern time, the next following business day) containing all data
and information necessary for Fund/Plan to maintain the Money Market Fund's
Accounts and Records and Fund/Plan may conclusively assume that the information
it receives by Written or Oral Instructions is complete and accurate. Fund/Plan,
as Transfer Agent, accepts responsibility for providing reports to the Fund/Plan
Accounting Unit of share purchases, redemptions, and total shares outstanding,
on the next business day after each net asset valuation.

Section 8. The Accounts and Records, in the agreed-upon format, maintained
by Fund/Plan shall be the property of the Money Market Fund and shall be made
available to the Money Market Fund promptly upon request and shall be maintained
for the periods prescribed in Rules 31a-1 and 31a-2 under the Investment Company
Act of 1940, as amended. Fund/Plan shall assist the Fund's independent auditors,
or upon approval of the Fund, or upon demand, any regulatory body, in any
requested review of the Fund's Accounts and Records but shall be reimbursed for
all reasonable expenses (expenses generally such as shipping, photocopying,

Page 5 of 11 pages.
<PAGE>

faxing, special reports, etc.) and reasonable employee time for complying with
extra services, (currently a rate of $50.00 per hour) invested in any such
review of the Fund's Accounts and Records outside of routine and normal periodic
review and audits. Upon receipt from the Money Market Fund of the necessary
information, Fund/Plan shall supply the necessary data for the Money Market Fund
or an independent auditor's completion of any necessary tax returns,
questionnaires, periodic reports to Shareholders and such other reports and
information requests as the Money Market Fund and Fund/Plan shall agree upon
from time to time.

Section 9. In case of any request or demand for the inspection of the
records of the Money Market Fund, Fund/Plan shall endeavor to notify the Money
Market Fund and to secure instructions as to permitting or refusing such
inspection. Fund/Plan may however, exhibit such records to any person in any
case where it is advised by its counsel that it may be held liable for failure
to do so after notice to the Money Market Fund.

Section 10. Fund/Plan and the Money Market Fund may from time to time
adopt such procedures as agreed upon in writing, and Fund/Plan may conclusively
assume that any procedure approved by the Money Market Fund or directed by the
Money Market Fund, does not conflict with or violate any requirements of the
Money Market Fund's Prospectus, Articles of Incorporation, By-Laws, or any rule
or regulation of any regulatory body or governmental agency. The Money Market
Fund shall be responsible for notifying Fund/Plan of any changes in regulations
or rules which might necessitate changes in Fund/Plan's procedures, and for
working out with Fund/Plan such changes.

Section 11.

(a) Fund/Plan, its directors, officers, employees, shareholders, and
agents shall not be liable for any error of judgment or mistake of law or for
any loss suffered by the Money Market Fund in connection with the performance of
this Agreement, except losses resulting from willful misfeasance, bad faith or
negligence on the part of Fund/Plan in the performance of its obligations and
duties under this Agreement.

(b) Any person, even though also a director, officer, employee,
shareholder or agent of Fund/Plan, who may be or become an officer, trustee,
employee or agent of the Money Market Fund shall be deemed, when rendering
services to the Money Market Fund or acting on any business of the Money Market
Fund (other than services or business in

Page 6 of 11 pages.
<PAGE>

connection with Fund/Plan's duties hereunder), to be rendering such services to
or acting solely for the Money Market Fund, and not as a director, officer,
employee, shareholder or agent of, or one under the control or direction of
Fund/Plan even though receiving a salary from Fund/Plan.

(i) any action taken or omitted to be taken by Fund/Plan
except matters resulting from willful misfeasance, bad faith, negligence or
reckless disregard on the part of Fund/Plan in the performance of its
obligations and duties under this Agreement; or

(ii) in reliance upon any certificate, instrument, order or
stock certificate or other document reasonably believed by it to be genuine and
to be signed, countersigned or executed by any duly authorized person, upon the
Oral Instructions or Written Instructions of an authorized person of the Money
Market Fund or upon the written opinion of legal counsel for the Money Market
Fund or Fund/Plan; or

(iii) any action taken or omitted to be taken in good faith by
Fund/Plan in connection with its appointment, in reliance upon any law, act,
regulation or interpretation of the same even though the same may thereafter
have been altered, changed, amended, or repealed. Indemnification under this
subparagraph shall not apply, however, to actions or omissions of Fund/Plan or
its directors, officers, employees, shareholders, or agents in cases of its or
their own negligence, willful misconduct, bad faith, or reckless disregard of
its or their own duties hereunder.

(d) Fund/Plan shall give written notice to the Money Market Fund
within ten (10) business days of receipt by Fund/Plan of a written assertion or
claim of any threatened or pending legal proceeding which may be subject to this
indemnification. The failure to so notify the Money Market Fund of such written
assertion or claim shall not, however, operate in any manner whatsoever to
relieve the Money Market Fund of any liability arising from this Section or
otherwise, except to the extent failure to give notice prejudices the Money
Market

Page 7 of 11 pages.
<PAGE>

Fund.

(e) For any legal proceeding giving rise to this indemnification,
the Money Market Fund shall be entitled to defend or prosecute any claim in the
name of Fund/Plan at its own expense and through counsel of its own choosing if
it gives written notice to Fund/Plan within ten (10) business days of receiving
notice of such claim. Notwithstanding the foregoing, Fund/Plan may participate
in the litigation at its own expense through counsel of its own choosing. If the
Money Market Fund chooses to defend or prosecute such claim, then the Parties
shall cooperate in the defense or prosecution thereof and shall furnish such
records and other information as are reasonably necessary.

(f) The Fund shall not settle any claim without the Company's
express written consent which shall not be unreasonably withheld. The Company
shall not settle any claim without the Fund's express written consent which
shall not be unreasonably withheld.

Section 12. All financial data provided to, processed by, and reported by
Fund/Plan under this Agreement shall be stated in United States dollars.
Fund/Plan shall have no obligation to convert to, equate, or deal in foreign
currencies or values, and expressly assumes no liability for any currency
conversion or non-U.S. dollar denominated computations relating to the affairs
of the Money Market Fund.

Section 13. The Money Market Fund agrees to pay Fund/Plan compensation for
its services and to reimburse it for expenses, at the rates and amounts as set
forth in Schedule "B" attached hereto, and as shall be set forth in any
amendments to such Schedule "B" approved by the Money Market Fund and Fund/Plan.
The Money Market Fund agrees and understands that Fund/Plan's compensation be
comprised of two components and payable on a monthly basis as follows:

(i) An asset based fee subject to a stated minimum fee, will
be billed to the Money Market Fund within the first ten (10) calendar days of
the month following the month in which the fee was incurred. The Money Market
Fund agrees to pay this fee to Fund/Plan within ten calendar days of receipt of
such bill.

(ii) Reimbursement of any reasonable out-of-pocket expenses
paid by Fund/Plan on behalf of the Money Market Fund, which out-of-pocket
expenses will be billed to the Money Market Fund within the first ten (10)
calendar days of the month following the month in which such out-of-pocket
expenses were incurred. The Money Market Fund agrees

Page 8 of 11 pages.
<PAGE>

to reimburse Fund/Plan for such expenses within ten calendar days of receipt of
such bill.

Section 14. Nothing contained in this Agreement is intended to or shall
require Fund/Plan, in any capacity hereunder, to perform any functions or duties
on any holiday, day of special observance or any other day on which the New York
Stock Exchange is closed. Functions or duties normally scheduled to be performed
on such days shall be performed on, and as of, the next succeeding business day
on which the New York Stock Exchange is open. Notwithstanding the foregoing,
Fund/Plan shall compute the net asset value for the Fund on each day required
pursuant to (i) Rule 22c-1 promulgated under the Investment Company Act of 1940,
as amended, and (ii) the Money Market Fund's Prospectus and Statement of
Additional Information then in effect.

Section 15.

(a) The term of this Agreement shall be for a period of three (3)
years, commencing on the date hereinabove first written ("Effective Date") and
shall continue thereafter on a year to year term subject to termination by
either Party as set forth in (c) below.

(b) The fee schedule set forth in Schedule "B" attached shall be
fixed for three (3) years commencing on the Effective Date of this Agreement and
shall continue thereafter subject to review and adjustment of the fee schedule
and termination notice as set forth in section (c) below.

(c) After the initial term of this Agreement, the Money Market Fund
or Fund/Plan may give written notice to the other of the termination of this
Agreement, such termination to take effect at the time specified in the notice,
which date shall not be less than one hundred twenty (120) days after the date
of receipt of such notice. Upon the effective termination date, the Money Market
Fund shall pay to Fund/Plan such compensation as may

Page 9 of 11 pages.
<PAGE>

be due as of the date of termination and shall likewise reimburse Fund/Plan for
any out-of-pocket expenses and disbursements reasonably incurred by Fund/Plan to
such date.

(d) If a successor to any of Fund/Plan's duties or responsibilities
under this Agreement is designated by the Money Market Fund by written notice to
Fund/Plan in connection with the termination of this Agreement, Fund/Plan shall
promptly upon such termination and at the expense of the Money Market Fund,
transfer all Required Records and shall cooperate in the transfer of such duties
and responsibilities.

Section 16. Except as otherwise provided in this Agreement, any notice or
other communication required by or permitted to be given in connection with this
Agreement shall be in writing, and shall be delivered in person or sent by first
class mail, postage prepaid to the respective parties as follows:

If to IAA Trust Money Market Fund, Inc. If to Fund/Plan:
- --------------------------------------- ----------------

Section 17. This Agreement may be amended from time to time by
supplemental agreement executed by the Money Market Fund and Fund/Plan and the
compensation stated in Schedule "B" attached hereto may be adjusted accordingly
as mutually agreed upon.

Section 18. The Money Market Fund represents and warrants to Fund/Plan
that the execution and delivery of this Agreement by the undersigned officers of
the Money Market Fund has been duly and validly authorized by resolution of the
Board of Directors of the Money Market Fund.

Section 19. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.

Section 20. This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by the Money Market Fund without the
written consent of Fund/Plan or by Fund/Plan without the written consent of the
Money Market Fund, authorized or approved

Page 10 of 11 pages.
<PAGE>

by a resolution of its respective Boards of Directors.

Section 21. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania and the venue of any action arising under this
Agreement shall be Montgomery County, Commonwealth of Pennsylvania.

Section 22. No provision of this Agreement may be amended or modified, in
any manner except by a written agreement properly authorized and executed by
Fund/Plan and the Money Market Fund.

Section 23. If any part, term or provision of this Agreement is held by
any court to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be affected,
and the rights and obligations of the parties shall be construed and enforced as
if the Agreement did not contain the particular part, term or provision held to
be illegal or invalid.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting of eleven typewritten pages, together with Schedules "A" and "B", to
be signed by their duly authorized officers as of the day and year first above
written.

IAA Trust Money Market Fund, Inc. Fund/Plan Services, Inc.
- --------------------------------- ------------------------

- ------------------------------------ ------------------------------------
By: Gary E. Mede, Vice President By: Kenneth J. Kempf, President

Page 11 of 11 pages.
<PAGE>

SCHEDULE "A"

FUND ACCOUNTING AND PORTFOLIO VALUATION SERVICES
FOR
THE MONEY MARKET FUND, INC.

Daily Accounting Services

1) Calculate Net Asset Value ("NAV") and Offering Price Per Share:

o Update the daily market value of securities held by the Money Market
Fund using Fund/Plan's standard agents for pricing domestic equity and
bond securities. The standard domestic equity pricing services are
Quotron/Reuters, Inc., Muller Data Corporation, or Interactive Data
Corporation (IDC). Muller Data Corporation, Telerate Systems, Inc and
IDC are used for bond and money market issues.
o Enter limited number (not to exceed ten per day) of manual prices
supplied by the Money Market Fund.
o Prepare NAV proof sheet. Review components of change in NAV for
reasonableness.
o Review variance reporting on-line and in hard copy for price changes
in individual securities using variance levels established by the
Money Market Fund. Verify US dollar security prices exceeding variance
levels by notifying the Money Market Fund and pricing sources of noted
variances.
o Review for ex-dividend items indicated by pricing sources; trace to
general ledger for agreement.
o Communicate required pricing information, NAV, to the Money Market
Fund's transfer agent (the "Transfer Agent") and, electronically, to
NASDAQ.

2) Complete Money Market (Daily Dividend) Fund Requirements: (If applicable)

o Calculate net investment income available for distribution daily.
o Calculate daily rate, and 1, 7, 30-day yields.
o Provide system calculated average weighted maturity.
o Supply Transfer Agent and client with distribution rates.
o Provide money market original and amortized cost schedules in
accordance with valuing the Fund based on amortized cost, inclusive of
all debt issues income accruals.
o Communicate required information electronically to NASDAQ, if
applicable.

3) Determine and Report Cash Availability to Fund by approximately 9:30 AM
Eastern Time:

o Receive daily cash and transaction statements from the Money Market
Fund's custodian by 8:30 AM Eastern time.
o Receive previous day shareholder activity reports from the transfer
agent by 8:30 AM Eastern time.
o Fax hard copy cash availability calculations with all details to the
Money

Schedule "A"; Page 1
<PAGE>

Market Fund.
o Supply the Money Market Fund with 5-day cash projection report.
o Prepare and complete daily bank cash reconciliations including
documentation of any reconciling items and notify the Custodian and
the Money Market Fund.
o For Money Market Funds, the Fund's transfer agent will also support
the client in receipt of timely cash information.

4) Reconcile and Record All Daily Expense Accruals:

o Accrue expenses based on budget supplied by the Money Market Fund
either as percentage of net assets or specific dollar amounts.
o If applicable, monitor expense limitations established by the Money
Market Fund.
o If applicable, accrue daily amortization of Organizational expense.
o If applicable, complete daily accrual of 12b-1 expenses.

5) Verify and Record All Daily Income Accruals for Debt Issues:

o Review and verify all system generated Interest and Amortization
reports.
o Establish unique security codes for bond issues to permit segregated
Trial Balance income reporting.

6) Monitor Domestic Securities Held for cash dividends, corporate actions and
capital changes such as splits, mergers, spinoffs, etc. and process
appropriately.

o Monitor electronically received information from Muller Data
Corporation for all domestic securities.
o Review current daily security trades for dividend activity.
o Interface with custodian to monitor timely collection and postings of
corporate actions, dividends and interest.

7) Enter All Security Trades on Investment Accounting System (IAS) based on
written instructions from the Money Market Fund.

o Review system verification of trade and interest calculations.
o Verify settlement through the statements supplied by the custodian.
o Maintain security ledger transaction reporting.
o Maintain tax lot holdings.
o Provide complete broker commission reporting.
o Determine realized gains or losses on security trades.

8) Enter All Fund Share Transactions on IAS:

o Process activity identified on reports supplied by the Fund/Plan
transfer agent.
o Verify settlement through the statements supplied by the Custodian.
o Reconcile to Fund/Plan's transfer agent report balances.

9) Prepare and Reconcile/Prove Accuracy of the Daily Trial Balance (listing
all asset, liability, equity, income and expense accounts)

o Post manual entries to the general ledger.
o Post custodian bank activity.

Schedule "A"; Page 2
<PAGE>

o Post shareholder and security transactions.
o Post and verify system generated activity, i.e., income and expense
accruals.
o Prepare general ledger net cash proof used in NAV calculation.

10) Review and Reconcile With Custodian Statements:

o Verify all posted interest, dividends, expenses, and shareholder and
security payments/receipts, etc. (Discrepancies will be reported to
and resolved by the custodian.)
o Post all cash settlement activity to the Trial Balance.
o Reconcile to ending cash balance accounts.
o Clear IAS subsidiary reports with settled amounts.
o Track status of past due items and failed trades handled by the
custodian.

11) Submission of Daily Accounting Reports to the Money Market Fund:
(Additional reports readily available.)

o Money Market Fund

- Trial Balance.
- NAV calculation report with daily distribution rate.
- Daily, 7-day and 30-day yield calculations.
- Cash Availability.
- Dollar Weighted Average Maturity.

Weekly Accounting Services

If applicable, submit Money Market Fund Mark-to Market Report and Interest
and Amortization schedule to the Money Market Fund (based on the Money Market
Fund or vendor supplied money market yields or prices).

Monthly Accounting Services

1) Full Financial Statement Preparation (automated Statements of Assets and
Liabilities, of Operations and of Changes in Net Assets) and submission to
the Money Market Fund by 10th business day.

2) Submission of Monthly Automated IAS Reports to the Money Market Fund:

o Security Purchase/Sales Journal
o Interest and Maturity Report
o Brokers Ledger (Commission Report)
o Security Ledger Transaction Report with Realized Gains/Losses
o Security Ledger Tax Lot Holdings Report
o Additional reports available upon request

3) Reconcile Accounting Asset Listing to Custodian Asset Listing:

Schedule "A"; Page 3
<PAGE>

o Report any security balance discrepancies to the custodian/the Money
Market Fund.

4) Provide Monthly Analysis and Reconciliation of Additional Trial Balance
Accounts, such as:

o Security cost and realized gains/losses
o Interest/dividend receivable and income
o Payable/receivable for securities purchased and sold
o Payable/receivable for fund shares; issued and redeemed
o Expense payments and accruals analysis

5) If Appropriate, Prepare and Submit to the Money Market Fund:

o SEC yield reporting (non-money market funds with domestic and ADR
securities only).
o Income by state reporting.
o Standard Industry Code Valuation Report.
o Alternative Minimum Tax Income segregation schedule.

Annual (and Semi-Annual) Accounting Services

1) Assist and supply auditors with schedules supporting securities and
shareholder transactions, income and expense accruals, etc. during the year
in accordance with standard audit assistance requirements.

2) Provide NSAR Reporting (Accounting Questions):

If applicable, answer the following items:

2, 12B, 20, 21, 22, 23, 28, 30A, 31, 32, 35, 36, 37, 43, 53, 55, 62, 63,
64B, 71, 72, 73, 74, 75, and 76.

Schedule "A"; Page 4
<PAGE>

ACCOUNTING SERVICES UNIT (ASU) BASIC ASSUMPTIONS FOR THE IAA
TRUST MONEY MARKET FUND, INC.

The Accounting Fees as set forth in Schedule "B" are based on the following
assumptions. To the extent these assumptions are inaccurate or requirements
change, fee revisions may be necessary.

Basic Assumptions:

1) The Money Market Fund's asset composition and trading activity levels will
remain comparable to the current portfolio.

2) The Money Market Fund has a tax year-end which coincides with its fiscal
year-end. No additional accounting requirements are necessary to identify
or maintain book-tax differences. ASU will supply segregated Trial Balance
account details to assist the Money Market Fund in proper identification by
category of all appropriate realized and unrealized gains/losses.

Security tax accounting which differs from book accounting will be provided
by the Money Market Fund or the Fund's independent auditor.

3) The Money Market Fund foresees no difficulty in using Fund/Plan's standard
current pricing agents for domestic equity, bond, and ADR securities.
Fund/Plan currently uses Quotron/Reuters, Inc., Muller Data Corporation or
Interactive Data Corporation (IDC) for domestic equities and listed ADR's.
Muller Data Corporation, Telerate Systems, Inc. or IDC are used for bonds
and money market instruments.

4) To the extent the Money Market Fund requires daily security prices (limited
to ten per day) from specific brokers for domestic securities, these manual
prices will be obtained by the Money Market Fund's investment advisor and
faxed to ASU by approximately 4:00 PM Eastern time for inclusion in the NAV
calculations. The Money Market Fund will also supply ASU with the
appropriate pricing contacts for the manual quotes.

5) To the extent the Money Market Fund should ever purchase/hold open-end
registered investment companies (RIC's), procedural discussions shall take
place between ASU and the Advisor to establish the appropriate pricing and
dividend rate sources. Depending on the methodologies selected by the Money
Market Fund, additional fees may apply.

6) ASU will supply daily Portfolio Valuation Reports to the Money Market
Fund's investment adviser or manager identifying current security
positions, original/amortized cost, security market values and changes in
unrealized appreciation/depreciation.

It will be the responsibility of the Fund's investment adviser to review
these reports and to promptly notify ASU of any possible problems, trade
discrepancies, incorrect

Schedule "A"; Page 5
<PAGE>

security prices, corporate action/capital change information that could
result in a misstated Fund NAV.

7) The Money Market Fund does not currently expect to invest in Futures,
Swaps, Derivatives or Foreign (non-US dollar denominated) currency or
securities. To the extent these investment strategies should change,
additional fees will apply after the appropriate procedural discussions
have taken place between ASU and the Money Market Fund. (At least two weeks
advance notice is required should the Money Market Fund commence trading in
these investments).

8) The Money Market Fund shall direct the investment advisor to supply the ASU
with critical income information such as accrual methods, interest payment
frequency details, coupon payment dates, floating rate reset dates and
complete security descriptions with issue types and CUSIP numbers. If
applicable, for proper income accrual accounting, ASU will look to the
investment advisor to supply the yield to maturity and related cash flow
models for any mortgage/asset-backed securities held by the Money Market
Fund.

9) The Money Market Fund shall direct the Custodian to provide ASU with daily
custodian statements reflecting all prior day cash activity by 8:30 AM
Eastern time. Complete descriptions of any postings, inclusive of CUSIP
numbers, interest/dividend payment dates, capital stock details, expense
authorizations, beginning/ending cash balances, etc. will be provided by
the Custodian's reports or system.

10) The Money Market Fund shall direct the custodian to supply capital change
information and interest rate changes to ASU in a timely manner. The
investment advisor will supplement and supply as appropriate.

11) The Money Market Fund shall direct the Custodian to handle and report upon
all settlement problems, failed trades and resolve unsettled
dividends/interest/paydowns and capital changes. The Custodian will process
all applicable capital change paperwork based upon advice from the
investment advisor. ASU agrees to supply segregated Trial Balance reporting
and supplemental reports to assist in this process.

12) With respect to mortgage/asset-backed securities including GNMA's, FHLMC's,
FNMA's, CMO's, ARM's, the Money Market Fund shall direct the Custodian (or
a Money Market Fund supplied source) to provide ASU with current principal
repayment factors on a timely basis in accordance with the appropriate
securities' schedule. Income accrual adjustments (to the extent necessary)
based upon initial estimates will be completed by ASU when actual
principal/income payments are collected by the Custodian and reported to
ASU.

13) To the extent applicable, ASU will maintain on a daily basis US dollar
denominated qualified covered call options and index options reporting on
the daily Trial Balance and value the respective options and underlying
positions. This Agreement does not provide for tax classifications if they
are required.

Schedule "A"; Page 6
<PAGE>

If the Money Market Fund commences investment in domestic options or
designated hedges, at least two week's advance notice is required to
clarify operational procedures between ASU and the investment advisor.

14) To the extent the Money Market Fund, Inc. should establish a Line of Credit
in segregated accounts with the Custodian for temporary administrative
purposes, and/or leveraging/hedging the portfolio, it is not the
responsibility under this Agreement for ASU to complete the appropriate
paperwork/monitoring for segregation of assets and adequacy of collateral.
The Money Market Fund shall direct the investment advisor to execute such
responsibilities. ASU will, however, reflect appropriate Trial Balance
account entries and interest expense accrual charges on the daily Trial
Balance adjusting as necessary at month-end.

15) If the Money Market Fund commences participation in Security Lending,
Leveraging, Precious Metals or Short Sales, at least two week's advance
notice is required. To the extent the Money Market Fund does so in the
future, additional fees will apply.

16) The Money Market Fund shall direct the investment advisor to supply ASU
with portfolio specific expense accrual procedures and monitor the expense
accrual balances for adequacy based on outstanding liabilities monthly. The
investment advisor will promptly communicate to the ASU any adjustments
needed.

17) Specific deadlines shall be met and complete information shall be supplied
by the Money Market Fund in order to minimize any settlement problems, NAV
miscalculations or income accrual adjustments.

The Money Market Fund shall direct the investment advisor to provide to ASU
Trade Authorization Forms, with the appropriate officer's signature, on all
security trades placed by the Money Market Fund no later than 12:30 PM
Eastern time on settlement/value date for money market issues, assuming
that trade date equals settlement date; and by 11:00 AM Eastern time on
trade date plus one for non-money market securities. Receipt by ASU of
trade information within these identified deadlines may be via telex, fax,
or on-line system access. The investment advisor will also communicate all
trade information directly to the Custodian.

There is no assurance that security trade information received by ASU after
the above stated deadlines will be included in that day's work.

The Money Market Fund agrees to direct the investment advisor to include
all information required by ASU, including CUSIP numbers and/or ticker
symbols for all US dollar denominated trades on the Trade Authorization
Form, telex or on-line support. ASU will not be responsible for NAV changes
or distribution rate adjustments that result from incomplete trade
information.

Schedule "A"; Page 7
<PAGE>

18) To the extent the Money Market Fund utilizes Purchases In-Kind (U.S. dollar
denominated securities only) as a method for shareholder subscriptions, ASU
will provide the Money Market Fund with procedures to properly handle and
process securities in-kind. Should the Money Market Fund prefer procedures
other than those provided by ASU, additional fees may apply. (The Parties
agree that discussions will take place in advance between ASU and the Money
Market Fund to clarify the appropriate In-Kind operational procedures to be
followed).

19) It is assumed that the investment advisor or Fund/Plan as administrator
will complete the applicable performance and rate of return calculations as
required by the SEC for the Money Market Fund.

20) Compliance reporting (Sub-Chapter "M") will be completed by the Fund/Plan
administrator or investment advisor.

21) Fund/Plan will provide Administration and Transfer Agency Services.

22) The Money Market Fund is not currently expected to issue separate classes
of shares. To the extent they do so, additional fees will be negotiated.

Schedule "A"; Page 8
<PAGE>

SCHEDULE "B"

FUND ACCOUNTING AND PORTFOLIO VALUATION SERVICES FEE SCHEDULE
FOR

IAA TRUST MONEY MARKET FUND, INC.

This Fee Schedule is fixed for a period of three (3) years from the Effective
Date as that term is defined in the Agreement.

The Accounting Fees as set forth below are based on the "Basic Assumptions" as
set forth in Schedule "A." To the extent that those assumptions are inaccurate
or requirements change, fee revisions may be necessary.

FUND ACCOUNTING AND PORTFOLIO VALUATION FEES (US dollar denominated
securities only) All Accounting Services fees are quoted with the assumption
that Transfer Agent Services will be provided by Fund/Plan Services, Inc.

I. Annual Fee Schedule Per Portfolio: (1/12th payable monthly)

$25,000 Minimum to $ 10 Million of Average Net Assets
.0004 On the Next $ 40 Million of Average Net Assets
.0003 On the Next $ 50 Million of Average Net Assets
.0001 Over $100 Million of Average Net Assets

II. Pricing Services Quotation Fee (Based on individual CUSIP or
security identification number.) Specific costs will be identified
based upon options selected by the client and will be billed
monthly.

A) Muller Data Corporation* (if applicable)
*(Based on current vendor costs, subject to change)

Government/Mortgage Backed/Corporate
Short & Long Term Quotes $ .50 per Quote per Issue
Tax-Exempt Short & Long Term Quotes $ .55 per Quote per Issue
CMOs/ARMs/ABS $1.00 per Quote per Issue
Foreign Security Quotes $ .50 per Quote per Issue
Foreign Security Supplemental
Corporation Actions, Dividends
& Capital Changes $2.00 per Issue per Month
Mortgage Backed Factors $1.00 per Issue per Month

Minimum Weekly File Transmission is Assumed

There are currently no charges for the domestic dividend and capital
change information transmitted daily to Fund/Plan services from
Muller Data Corporation.

Schedule "B"; Page 1
<PAGE>

B) Futures and Currency Forward Contracts $2.00 per Issue per Day

C) Telerate Systems, Inc.* (if applicable)
*(Based on current vendor costs, subject to change.)

Specific costs will be identified based upon options selected
by the client and will be billed monthly.

D) Quotron/Reuters, Inc.*
*(Based on current vendor costs, subject to change.)

Fund/Plan does not currently pass along the charges for the
domestic security prices supplied by Quotron/Reuters, Inc.

E) Interactive Data Corp.* (if applicable)
*(Based on current vendor costs, subject to change.)

Domestic Equities and Options $ .15 per Quote per Issue
Corporate/Government/Agency Bonds including
Mortgage-Backed Securities (evaluated,
seasoned, and/or closing) $ .50 per Quote per Issue
US Municipal Bonds and Collateralized
Mortgage Obligations $ .80 per Quote per Issue
International Equities and Bonds $ .50 per Quote per Issue

Domestic Dividends and Capitalization
Changes $3.50 per Month per Holding
International Dividends and Capital
Changes $4.00 per Month per Holding

Interactive Data also charges monthly transmission costs and
disk storage charges.

Specific costs will be identified based upon options selected by the
Money Market Fund and will be billed monthly.

III. SEC Yield Calculation: (if applicable)

Provide up to 12 reports per year to reflect the yield calculations for
non-money market funds required by the SEC, at no additional charge. (US
dollar denominated securities only.)

Schedule "B"; Page 2
<PAGE>

IV. Out-Of-Pocket Expenses

The Money Market Fund will reimburse Fund/Plan Services, Inc. monthly for
all out-of-pocket expenses, including telephone, postage,
telecommunications, special reports, record retention, special
transportation costs as approved, and the cost of copying and sending
materials to auditors.

V. Additional Services

To the extent the Money Market Fund commences using investment techniques such
as Futures, Security Lending, Swaps, Short Sales, Derivatives, Leveraging,
Precious Metals or non-US dollar denominated currency and securities, additional
fees will apply, as mutually agreed upon.

Activities of a non-recurring nature such as shareholder in-kinds, fund
consolidations, mergers, or reorganizations will be subject to negotiation. To
the extent that the Money Market Fund should decide to issue separate/multiple
classes of shares, additional fees shall apply. Any additional enhanced
services, programming requests or reports will be quoted upon request.

This Schedule may be amended to reflect the addition of other services/reports.

Schedule "B"; Page 3

AMENDMENT TO ACCOUNTING SERVICES AGREEMENT

This AGREEMENT, dated as of the 29th day of July, 1996 made by and
between IAA Trust Taxable Fixed Income Series Fund, Inc., (the "Fund") (formerly
known as IAA Trust Money Market Fund, Inc.) a corporation duly organized and
existing under the laws of the state of Maryland, operating as a registered
investment company under the Investment Company Act of 1940, as amended, and
Fund/Plan Services, Inc., ("Fund/Plan") a corporation duly organized and
existing under the laws of the State of Delaware (collectively, the "Parties").

WITNESSETH THAT:

WHEREAS, the Parties originally entered into an Accounting Services
agreement dated August 1, 1995, (the "Agreement"); and

WHEREAS, the Parties wish to amend the Agreement to provide for the
issuance of separate series of shares for the Fund identified;

NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Parties hereto, intending to be legally bound, do hereby
agree:

1. The name of the Fund has been changed to IAA Trust Taxable Fixed
Income Series Fund, Inc., as set forth on the attached Schedule "C".

2. To the addition of two new series for IAA Trust Taxable Fixed Income
Series Fund, Inc. as set forth on the attached Schedule "C".

IAA Trust Taxable Fixed Income Fund/Plan Services, Inc.
Series Fund, Inc.

- ---------------------------------- ----------------------------------
By: Gary E. Mede, Vice-President By: Kenneth J. Kempf, President

- ---------------------------------- ----------------------------------
Attest: Attest:

<PAGE>

SCHEDULE "C"
AS AMENDED ON JULY 29, 1996

IDENTIFICATION OF SERIES

Below are listed the Series to which services under this Agreement are to be
performed as of the execution date of this Agreement:

IAA TRUST TAXABLE FIXED INCOME SERIES FUND, INC.
------------------------------------------------

IAA Trust Money Market Series
IAA Trust Short-Term Government Bond Series
IAA Trust Long-Term Bond Series

This Schedule "C" may be amended from time to time by agreement of the parties.