SEI LIQUID ASSET TRUST, 485BPOS, 1997-10-23

SEI LIQUID ASSET TRUST
485BPOS, 1997-10-23

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 23, 1997

FILE NO. 2-73428
FILE NO. 811-3231
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

FORM N-1A

REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 / /
POST-EFFECTIVE AMENDMENT NO. 21 /X/
AND
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 / /
AMENDMENT NO. 21 /X/

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

SEI LIQUID ASSET TRUST
(Exact Name of Registrant as Specified in Charter)

C/O CT CORPORATION
2 Oliver Street
Boston, Massachusetts 02109
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (800) 342-5734

DAVID G. LEE
c/o SEI Investments Company
Oaks, Pennsylvania 19456
(Name and Address of Agent for Service)

COPIES TO:

Richard W. Grant, Esq. John H. Grady, Jr., Esq.
Morgan, Lewis & Bockius LLP Morgan, Lewis & Bockius LLP
2000 One Logan Square 1800 M Street, N.W.
Philadelphia, Pennsylvania 19103 Washington, D.C. 20036

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

Title of Securities Being Registered . . . Units of Beneficial Interest

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

<TABLE>
<C> <S>
/X/ immediately upon filing pursuant to paragraph (b)
/ / on [date] pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a)
/ / on [date] pursuant to paragraph (a) of Rule 485
</TABLE>

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<PAGE>
SEI LIQUID ASSET TRUST
CROSS REFERENCE SHEET

<TABLE>
<CAPTION>
N-1A ITEM NO. LOCATION
- -------------------------------------------------------------- -------------------------------------------------
<S> <C> <C>

PART A--ALL PORTFOLIOS--CLASS A
Item 1. Cover Page....................................... Cover Page
Item 2. Synopsis......................................... Annual Operating Expenses; Example
Item 3. Condensed Financial Information.................. Financial Highlights
Item 4. General Description of Registrant................ The Trust; Investment Objectives and Policies;
General Investment Policies; Investment
Limitations
Item 5. Management of the Fund........................... The Manager; The Adviser; General Information
Item 5A. Management's Discussion of Fund Performance......
Item 6. Capital Stock and Other Securities............... General Information--Voting Rights; Shareholder
Inquiries; Dividends; Taxes
Item 7. Purchase of Securities Being Offered............. Purchase and Redemption of Shares
Item 8. Redemption or Repurchase......................... Purchase and Redemption of Shares
Item 9. Pending Legal Proceedings........................ *

PART A--TREASURY SECURITIES PORTFOLIO--CLASS D

Item 1. Cover Page....................................... Cover Page
Item 2. Synopsis......................................... Annual Operating Expenses; Example
Item 3. Condensed Financial Information.................. Financial Highlights
Item 4. General Description of Registrant................ The Trust; Investment Objectives and Policies;
General Investment Policies; Investment
Limitations
Item 5. Management of the Fund........................... The Manager; The Adviser; General Information
Item 5A. Management's Discussion of Fund Performance...... *
Item 6. Capital Stock and Other Securities............... General Information--Voting Rights; Shareholder
Inquiries; Dividends; Taxes
Item 7. Purchase of Securities Being Offered............. Purchase and Redemption of Shares
Item 8. Redemption or Repurchase......................... Purchase and Redemption of Shares
Item 9. Pending Legal Proceedings........................ *

PART B--ALL PORTFOLIOS

Item 10. Cover Page....................................... Cover Page
Item 11. Table of Contents................................ Table of Contents
Item 12. General Information and History.................. The Trust
Item 13. Investment Objectives and Policies............... Description of Permitted Investments; Investment
Limitations
</TABLE>

(i)
<PAGE>

<TABLE>
<CAPTION>
N-1A ITEM NO. LOCATION
- -------------------------------------------------------------- -------------------------------------------------
<S> <C> <C>
Item 14. Management of the Registrant..................... Trustees and Officers of the Trust; The Manager;
The Adviser
Item 15. Control Persons and Principal Holders of
Securities..................................... 5% Shareholders; Trustees and Officers of the
Trust
Item 16. Investment Advisory and Other Services........... The Adviser; The Manager; Distribution and
Shareholder Servicing; Experts
Item 17. Brokerage Allocation............................. Portfolio Transactions
Item 18. Capital Stock and Other Securities............... Description of Shares
Item 19. Purchase, Redemption, and Pricing of Securities
Being Offered.................................. Purchase and Redemption of Shares (Prospectus);
Determination of Net Asset Value
Item 20. Tax Status....................................... Taxes (Prospectus); Tax
Item 21. Underwriters..................................... Distribution and Shareholder Servicing
Item 22. Calculation of Performance Data.................. Performance
Item 23. Financial Statements............................. Financial Information
</TABLE>

PART C

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

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

* Not Applicable

(ii)
<PAGE>
SEI LIQUID ASSET TRUST

OCTOBER 30, 1997

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TREASURY SECURITIES PORTFOLIO

GOVERNMENT SECURITIES PORTFOLIO

PRIME OBLIGATION PORTFOLIO

INSTITUTIONAL CASH PORTFOLIO

MONEY MARKET PORTFOLIO

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

This Prospectus sets forth concisely information about the above-referenced
Portfolios that an investor needs to know before investing. Please read this
Prospectus carefully, and keep it on file for future reference.

A Statement of Additional Information dated October 30, 1997, has been filed
with the Securities and Exchange Commission, and is available upon request and
without charge by writing the Distributor, SEI Investments Distribution Co.,
Oaks, Pennsylvania 19456, or by calling 1-800-342-5734. The Statement of
Additional Information is incorporated by reference into this Prospectus.

SEI Liquid Asset Trust (the "Trust") is an open-end management investment
company, certain classes of which offer financial institutions a convenient
means of investing their own funds, or funds for which they act in a fiduciary,
agency or custodial capacity, in one or more professionally managed diversified
portfolios of securities. Some portfolios offer separate classes of units of
beneficial interest that differ from each other primarily in the allocation of
certain distribution expenses and minimum investment amounts. This Prospectus
offers Class A shares of each of the Trust's five money market portfolios (each
a "Portfolio" and, together, the "Portfolios") listed above.

AN INVESTMENT IN A PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT A PORTFOLIO WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.

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

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

THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK. THE SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY. INVESTMENT IN THE SHARES INVOLVES RISK, INCLUDING POSSIBLE
LOSS OF THE PRINCIPAL AMOUNT INVESTED.
<PAGE>
ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
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<TABLE>
<CAPTION>
TREASURY GOVERNMENT PRIME INSTITUTIONAL MONEY
SECURITIES SECURITIES OBLIGATION CASH MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Management/Advisory Fees (AFTER FEE WAIVERS) (1) .41% .43% .41% .36% .39%
12b-1 Fees None None None None None
Total Other Expenses .03% .01% .03% .08% .05%(2)
Shareholder Servicing Expenses (AFTER FEE WAIVERS) (3) .00% .00% .00% .00% .00%
- --------------------------------------------------------------------------------------------------------------------------
Total Operating Expenses (AFTER FEE WAIVERS) (4) .44% .44% .44% .44% .44%
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) THE MANAGER HAS AGREED TO WAIVE ITS FEE IN AN AMOUNT NECESSARY TO LIMIT THE
TOTAL OPERATING EXPENSES OF EACH PORTFOLIO TO NOT MORE THAN .44% OF ITS
AVERAGE NET ASSETS. IN THE CASE OF THE INSTITUTIONAL CASH PORTFOLIO, THIS
WAIVER IS VOLUNTARY AND MAY BE TERMINATED AT ANY TIME IN THE MANAGER'S SOLE
DISCRETION. ABSENT THIS WAIVER, MANAGEMENT/ADVISORY FEES FOR THE TREASURY
SECURITIES, GOVERNMENT SECURITIES, PRIME OBLIGATION AND MONEY MARKET
PORTFOLIOS, WOULD BE .45%, .45%, .45%, AND .45%, RESPECTIVELY.
MANAGEMENT/ADVISORY FEES HAVE BEEN RESTATED TO REFLECT CURRENT EXPENSES.

(2) TOTAL OTHER EXPENSES FOR THE MONEY MARKET PORTFOLIO ARE BASED ON ESTIMATED
AMOUNTS FOR THE CURRENT FISCAL YEAR.

(3) THE DISTRIBUTOR HAS WAIVED, ON A VOLUNTARY BASIS, ALL OR A PORTION OF ITS
SHAREHOLDER SERVICING FEE, AND THE SHAREHOLDER SERVICING EXPENSES SHOWN
REFLECT THIS WAIVER. THE DISTRIBUTOR RESERVES THE RIGHT TO TERMINATE ITS
WAIVER AT ANY TIME IN ITS SOLE DISCRETION. ABSENT SUCH WAIVER, SHAREHOLDER
SERVICING EXPENSES WOULD BE .25% FOR EACH PORTFOLIO.

(4) ABSENT WAIVERS, TOTAL OPERATING EXPENSES FOR THE TREASURY SECURITIES,
GOVERNMENT SECURITIES, PRIME OBLIGATION, INSTITUTIONAL CASH AND MONEY MARKET
PORTFOLIOS WOULD BE .73%, .71%, .73%, .69%, AND .75%, RESPECTIVELY.
ADDITIONAL INFORMATION MAY BE FOUND UNDER "THE MANAGER," "THE ADVISER" AND
"DISTRIBUTION AND SHAREHOLDER SERVICING."

EXAMPLE
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<TABLE>
<CAPTION>
1 YR. 3 YRS. 5 YRS. 10 YRS.
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
An investor in any Portfolio would pay the following expenses on a $1,000
investment assuming (1) a 5% annual return and (2) redemption at the end of
each time period: $ 5 $ 14 $ 25 $ 55
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES. ACTUAL
EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.

THE PURPOSE OF THE EXPENSE TABLE AND EXAMPLE IS TO ASSIST THE INVESTOR IN
UNDERSTANDING THE VARIOUS COSTS AND EXPENSES THAT MAY BE DIRECTLY OR INDIRECTLY
BORNE BY INVESTORS IN CLASS A SHARES OF THE PORTFOLIOS. THE TREASURY SECURITIES
PORTFOLIO ALSO OFFERS CLASS D SHARES, WHICH ARE SUBJECT TO THE SAME EXPENSES
EXCEPT THAT CLASS D SHARES BEAR CERTAIN DISTRIBUTION AND TRANSFER AGENT COSTS. A
PERSON WHO PURCHASES SHARES THROUGH A FINANCIAL INSTITUTION MAY BE CHARGED
SEPARATE FEES BY THAT INSTITUTION. ADDITIONAL INFORMATION REGARDING THESE
DIFFERENCES MAY BE FOUND UNDER "THE MANAGER," "THE ADVISER" AND "DISTRIBUTION
AND SHAREHOLDER SERVICING".

2
<PAGE>
FINANCIAL HIGHLIGHTS
______________________________________________________________

The following financial highlights for a share outstanding throughout each
period have been audited by Price Waterhouse LLP, the Trust's independent
accountants, whose report on the financial statements including this
information, dated August 7, 1997, was unqualified. This information should be
read in conjunction with the Trust's financial statements as of and for the
fiscal year ended June 30, 1997, and notes thereto, which are incorporated by
reference to the Trust's Statement of Additional Information. Additional
performance information is set forth in the Trust's 1997 Annual Report to
Shareholders, which is available upon request and without charge by calling
1-800-342-5734. As of June 30, 1997, the Money Market Portfolio had not
commenced operations.

FOR A CLASS A SHARE OUTSTANDING THROUGHOUT EACH PERIOD

<TABLE>
<CAPTION>
NET ASSET DISTRIBUTIONS
VALUE NET REALIZED AND FROM NET DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT UNREALIZED GAINS INVESTMENT FROM REALIZED VALUE END
OF PERIOD INCOME ON SECURITIES INCOME CAPITAL GAINS OF PERIOD
- ------------------------------ ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- --------------------
TREASURY SECURITIES
- --------------------
1997 $ 1.00 $ 0.05 $ -- $ (0.05) $ -- $ 1.00
1996 1.00 0.05 -- (0.05) -- 1.00
1995 1.00 0.05 -- (0.05) -- 1.00
1994 1.00 0.03 -- (0.03) -- 1.00
1993 1.00 0.03 -- (0.03) -- 1.00
1992 1.00 0.05 -- (0.05) -- 1.00
1991 1.00 0.07 -- (0.07) -- 1.00
1990 1.00 0.08 -- (0.08) -- 1.00
1989 1.00 0.08 -- (0.08) -- 1.00
1988 1.00 0.06 -- (0.06) -- 1.00
- -----------------------
GOVERNMENT SECURITIES
- -----------------------
1997 $ 1.00 $ 0.05 $ -- $ (0.05) $ -- $ 1.00
1996 1.00 0.05 -- (0.05) -- 1.00
1995 1.00 0.05 -- (0.05) -- 1.00
1994 1.00 0.03 -- (0.03) -- 1.00
1993 1.00 0.03 -- (0.03) -- 1.00
1992 1.00 0.05 -- (0.05) -- 1.00
1991 1.00 0.07 -- (0.07) -- 1.00
1990 1.00 0.08 -- (0.08) -- 1.00
1989 1.00 0.08 -- (0.08) -- 1.00
1988 1.00 0.07 -- (0.07) -- 1.00

<CAPTION>
RATIO OF
NET
RATIO OF RATIO OF INVESTMENT
NET EXPENSES INCOME TO
RATIO OF INVESTMENT TO AVERAGE AVERAGE
NET ASSETS EXPENSES INCOME TO NET ASSETS NET ASSETS
TOTAL END OF TO AVERAGE AVERAGE (EXCLUDING (EXCLUDING
RETURN PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS)
- ------------------------------ ---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- --------------------
TREASURY SECURITIES
- --------------------
1997 5.10% $ 706,232 0.44% 4.98% 0.74% 4.68%
1996 5.37 832,393 0.44 5.27 0.52 5.19
1995 5.05 1,254,888 0.44 4.93 0.54 4.83
1994 3.00 1,501,510 0.44 2.91 0.51 2.84
1993 3.03 2,219,701 0.44 2.99 0.50 2.93
1992 4.69 2,304,153 0.44 4.60 0.50 4.50
1991 7.04 2,248,497 0.44 6.80 0.47 6.80
1990 8.41 2,076,845 0.44 8.10 0.45 8.10
1989 8.51 2,318,763 0.44 8.20 0.44 8.20
1988 6.56 2,671,802 0.44 6.40 0.44 6.40
- -----------------------
GOVERNMENT SECURITIES
- -----------------------
1997 5.09% $ 148,606 0.44% 4.98% 0.71% 4.71%
1996 5.30 169,133 0.44 5.19 0.54 5.09
1995 5.18 200,768 0.44 5.04 0.53 4.95
1994 3.04 255,554 0.44 2.96 0.51 2.89
1993 3.05 507,832 0.44 3.00 0.50 2.94
1992 4.72 399,938 0.44 4.60 0.50 4.60
1991 7.08 520,187 0.44 6.80 0.48 6.70
1990 8.48 368,318 0.44 8.10 0.45 8.10
1989 8.69 467,056 0.44 8.30 0.46 8.30
1988 6.83 523,274 0.44 6.70 0.44 6.70
</TABLE>

3
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED) _______________________________________________

FOR A CLASS A SHARE OUTSTANDING THROUGHOUT EACH PERIOD

<TABLE>
<CAPTION>
NET ASSET DISTRIBUTIONS
VALUE NET REALIZED AND FROM NET DISTRIBUTIONS NET ASSET
BEGINNING INVESTMENT UNREALIZED GAINS INVESTMENT FROM REALIZED VALUE END
OF PERIOD INCOME ON SECURITIES INCOME CAPITAL GAINS OF PERIOD
- ------------------------------ ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- -----------------
PRIME OBLIGATION
- -----------------
1997 $ 1.00 $ 0.05 $ -- $ (0.05) $ -- $ 1.00
1996 1.00 0.05 -- (0.05) -- 1.00
1995 1.00 0.05 -- (0.05) -- 1.00
1994 1.00 0.03 -- (0.03) -- 1.00
1993 1.00 0.03 -- (0.03) -- 1.00
1992 1.00 0.05 -- (0.05) -- 1.00
1991 1.00 0.07 -- (0.07) -- 1.00
1990 1.00 0.08 -- (0.08) -- 1.00
1989 1.00 0.09 -- (0.09) -- 1.00
1988 1.00 0.07 -- (0.07) -- 1.00
- -------------------
INSTITUTIONAL CASH*
- -------------------
1997 $ 1.00 $ 0.0002 $ -- $(0.0002) $ -- $ 1.00
1996 1.00 0.0005 -- (0.0005) -- 1.00
1995 1.00 0.0003 -- (0.0003) -- 1.00
1994 1.00 0.0003 -- (0.0003) -- 1.00
1993 1.00 0.0003 -- (0.0003) -- 1.00
1992 1.00 0.0002 -- (0.0002) -- 1.00
1991 1.00 0.0003 0.0001 (0.0003) (0.0001) 1.00
1990 1.00 0.0008 0.0003 (0.0008) (0.0003) 1.00
1989 1.00 0.0007 0.0002 (0.0007) (0.0002) 1.00
1988 1.00 0.0006 0.0001 (0.0006) (0.0001) 1.00

<CAPTION>
RATIO OF
NET
RATIO OF RATIO OF INVESTMENT
NET EXPENSES INCOME TO
RATIO OF INVESTMENT TO AVERAGE AVERAGE
NET ASSETS EXPENSES INCOME TO NET ASSETS NET ASSETS
TOTAL END OF TO AVERAGE AVERAGE (EXCLUDING (EXCLUDING
RETURN PERIOD (000) NET ASSETS NET ASSETS WAIVERS) WAIVERS)
- ------------------------------ ---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- -----------------
PRIME OBLIGATION
- -----------------
1997 5.20% $ 823,270 0.44% 5.08% 0.74% 4.78%
1996 5.39 747,852 0.44 5.27 0.53 5.18
1995 5.20 940,863 0.44 5.21 0.53 5.12
1994 3.08 918,509 0.44 3.03 0.51 2.96
1993 3.07 1,173,109 0.44 3.04 0.50 2.98
1992 4.73 1,515,554 0.44 4.70 0.49 4.60
1991 7.36 1,729,845 0.44 7.10 0.47 7.10
1990 8.57 1,804,367 0.44 8.30 0.45 8.30
1989 8.85 2,160,859 0.44 8.50 0.44 8.50
1988 7.12 2,224,159 0.44 6.90 0.44 6.90
- -------------------
INSTITUTIONAL CASH*
- -------------------
1997 3.94% $ -- 0.44% 3.94% 0.69% 3.69%
1996 4.58 -- 0.44 4.58 0.44 4.58
1995 4.94 -- 0.44 5.19 0.44 5.19
1994 2.60 -- 0.44 2.63 0.44 2.63
1993 2.83 -- 0.44 2.66 0.44 2.66
1992 3.47 -- 0.44 3.50 0.44 3.50
1991 7.12 -- 0.42 5.90 0.42 5.90
1990 10.22 -- 0.44 7.80 0.44 7.80
1989 8.49 -- 0.44 6.80 0.44 6.80
1988 4.02 -- 0.44 5.20 0.44 5.20
</TABLE>

* ANNUALIZED
AMOUNTS DESIGNATED AS "--" ARE NEITHER $0 OR HAVE BEEN ROUNDED TO $0.

4
<PAGE>
THE TRUST
__________________________________________________________________________

SEI LIQUID ASSET TRUST (the "Trust") is an open-end management investment
company that offers units of beneficial interest ("shares") in separate
diversified investment portfolios. This Prospectus offers Class A shares of the
Trust's Treasury Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios (each a "Portfolio" and,
together, the "Portfolios"). The Treasury Securities Portfolio also offers Class
D shares. Additional information pertaining to the Trust may be obtained by
writing to SEI Investments Distribution Co., Oaks, Pennsylvania 19456, or by
calling 1-800-342-5734.

INVESTMENT
OBJECTIVES AND
POLICIES
___________________________________________________________________________
TREASURY SECURITIES
PORTFOLIO
The Treasury Securities Portfolio seeks to preserve
principal value and maintain a high degree of liquidity
while providing current income.

The Portfolio invests exclusively in U.S. Treasury
obligations and repurchase agreements involving such
obligations. The repurchase agreement dealers selected for
the Treasury Securities Portfolio must meet certain
creditworthiness criteria established by Standard & Poor's
Corporation ("S&P").

GOVERNMENT
SECURITIES PORTFOLIO
The Government Securities Portfolio seeks to preserve
principal value and maintain a high degree of liquidity
while providing current income.

The Portfolio invests exclusively in U.S. Treasury
obligations, obligations issued or guaranteed as to
principal and interest by agencies or instrumentalities of
the U.S. Government, and repurchase agreements involving
such obligations.

PRIME OBLIGATION
PORTFOLIO
The Prime Obligation Portfolio seeks to preserve principal
value and maintain a high degree of liquidity while
providing current income.

The Portfolio invests exclusively in: (i) commercial
paper rated at least A-1 by S&P or Prime-1 by Moody's
Investors Service, Inc. ("Moody's") at the time of
investment or, if not rated, determined by the Adviser to
be of comparable quality; (ii) obligations (including
certificates of deposit, time deposits, bankers'
acceptances and bank notes) of U.S. commercial banks or
savings and loan institutions that are members of the
Federal Reserve System or are insured by the Federal
Deposit Insurance Corporation, which banks or institutions
have total assets of $500 million or more as shown on their
most recent public financial statements, at the time of
investment, provided that such obligations are rated in the
top two short-term rating categories by two or more
nationally recognized statistical rating organizations
("NRSROs"), or one NRSRO if only one NRSRO has rated the
security at the time of investment or, if not rated,
determined by the Adviser to be of comparable quality;
(iii) short-term corporate obligations rated AAA or AA by
S&P or Aaa or Aa by Moody's at the time of investment or,
if not rated, determined by the Adviser to be of comparable
quality; (iv) short-term obligations issued by state and
local

5
<PAGE>
governmental issuers, which are rated, at the time of
investment, by at least two NRSROs in one of the two
highest municipal bond rating categories, and which carry
yields that are competitive with those of other types of
money market instruments of comparable quality; (v) U.S.
Treasury obligations and obligations issued or guaranteed
as to principal and interest by agencies or
instrumentalities of the U.S. Government; and (vi)
repurchase agreements involving any of the foregoing
obligations.

INSTITUTIONAL CASH
PORTFOLIO
The Institutional Cash Portfolio seeks to preserve
principal value and maintain a high degree of liquidity
while providing current income.

The Portfolio invests exclusively in U.S. Treasury
obligations.

MONEY MARKET
PORTFOLIO
The Money Market Portfolio seeks to preserve principal
value and maintain a high degree of liquidity while
providing current income.

The Portfolio invests in the following U.S. dollar
denominated obligations: (i) commercial paper issued by
U.S. and foreign issuers rated at the time of investment in
the highest short-term rating category by two or more
NRSROs, or one NRSRO if only one NRSRO has rated the
security or, if not rated, determined by the Adviser to be
of comparable quality; (ii) obligations (including
certificates of deposit, time deposits, bankers'
acceptances and bank notes) of U.S. savings and loan and
thrift institutions, U.S. commercial banks (including
foreign branches of such banks), and U.S. and London
branches of foreign banks, provided that such institutions
(or, in the case of a branch, the parent institution) have
total assets of $1 billion or more as shown on their last
published financial statements, at the time of investment;
(iii) short-term corporate obligations issued by U.S. and
foreign issuers with a remaining term of not more than 397
days that issue commercial paper of comparable priority and
security meeting the above ratings; (iv) short-term
obligations issued by state and local governmental issuers
which are rated, at the time of investment, by at least two
NRSROs in one of the two highest municipal bond rating
categories, or, if not rated, determined by the Adviser to
be of comparable quality, and which carry yields that are
competitive with those of other types of money market
instruments of comparable quality; (v) U.S. Treasury
obligations and obligations issued or guaranteed as to
principal and interest by the agencies or instrumentalities
of the U.S. Government; (vi) U.S. dollar denominated
obligations of foreign governments, including Canadian and
Provincial Government and Crown Agency obligations; (vii)
repurchase agreements involving any of the foregoing
obligations; and (viii) custodial receipts representing
investments in component parts of U.S. Treasury
obligations.

There can be no assurance that the Portfolios will
achieve their respective investment objectives.

6
<PAGE>
GENERAL INVESTMENT
POLICIES
___________________________________________________________________________

In purchasing obligations, each Portfolio complies with the
requirements of Rule 2a-7 under the 1940 Act, as that Rule
may be amended from time to time. These requirements
currently provide that each Portfolio must limit its
investments to securities with remaining maturities of 397
days or less, and must maintain a dollar-weighted average
maturity of 90 days or less. In addition, Rule 2a-7
provides that funds may only invest in securities (other
than U.S. Government Securities) rated in one of the two
highest categories for short-term securities by at least
two NRSROs (or by one NRSRO if only one NRSRO has rated the
security), or, if unrated, determined by the fund's adviser
(in accordance with procedures adopted by the Trust's Board
of Trustees) to be of equivalent quality to rated
securities in which the fund may invest. Except to the
extent that their investment policies are more restrictive
than Rule 2a-7 or that Rule 2a-7's provisions are
inapplicable, each Portfolio intends to comply fully with
Rule 2a-7.

Securities rated in the highest rating category by at
least two NRSROs (or, if unrated, determined by the Adviser
to be of comparable quality) are "first tier" securities.
Non-first tier securities in the second highest rating
category by at least one NRSRO (or, if unrated, determined
by the Adviser to be of comparable quality) are considered
to be "second tier" securities. Each of the Money Market
and Prime Obligation Portfolios will invest, in the
aggregate, no more than 5% of its assets in second tier
securities, and any investment in any one second tier
security is limited to the greater of 1% of a Portfolio's
total assets or $1 million, except that the Prime
Obligation Portfolio currently invests only in first tier
securities.

The quality, maturity and diversification
requirements of the Government Securities and Prime
Obligation Portfolios are more restrictive than those
imposed by Rule 2a-7. The Government Securities and Prime
Obligation Portfolios may only purchase securities with a
remaining maturity of 365 days or less, and, as a matter of
non-fundamental policy, will maintain a dollar-weighted
average portfolio maturity of 90 days or less. If
Shareholders of these Portfolios elect to modify the
Portfolios' investment limitations in the future, the
Portfolios could take advantage of certain provisions in
the Rule that are more liberal than the Portfolios'
policies and that are followed by the Trust's other
Portfolios.

The Money Market and Prime Obligation Portfolios may
invest up to 10% of their net assets in illiquid
securities. However, restricted securities, including Rule
144A securities and Section 4(2) commercial paper, that
meet the criteria established by the Board of Trustees of
the Trust will be considered liquid.

Each Portfolio may purchase securities on a
when-issued or delayed delivery basis.

For additional information regarding the Portfolios'
permitted investments and the ratings referred to above,
see "Description of Permitted Investments and Risk Factors"
and the Statement of Additional Information.

7
<PAGE>
INVESTMENT
LIMITATIONS
________________________________________________________________________

The investment objective and certain of the investment
limitations are fundamental policies of the Portfolios.
Fundamental policies cannot be changed with respect to a
Portfolio without the consent of the holders of a majority
of that Portfolio's outstanding shares.

It is a fundamental policy of each Portfolio to use
its best efforts to maintain a constant net asset value of
$1.00 per share. In addition, it is a fundamental policy of
each of the Government Securities and Prime Obligation
Portfolios to invest its assets solely in the securities
listed as appropriate investments for that Portfolio.

EACH PORTFOLIO MAY NOT:

1. Purchase securities of any issuer (except securities
issued or guaranteed by the U.S. Government, its
agencies or instrumentalities and any securities
guaranteed thereby) if as a result more than 5% of the
total assets of the Portfolio (based on fair market
value at the time of investment) would be invested in
the securities of such issuer; provided, however, that
the Treasury Securities, Money Market and Institutional
Cash Portfolios may temporarily invest up to 25% of
their total assets without regard to this restriction as
permitted by Rule 2a-7.

2. Purchase any securities which would cause more than 25%
of the total assets of the Portfolio to be invested in
the securities of one or more issuers conducting their
principal business activities in the same industry,
provided that this limitation does not apply to
investments in (a) domestic banks and (b) obligations
issued or guaranteed by the U.S. Government or its
agencies and instrumentalities.

3. Borrow money except for temporary or emergency purposes
and then only in an amount not exceeding 10% of the
value of the total assets of that Portfolio. This
borrowing provision is included solely to facilitate the
orderly sale of portfolio securities to accommodate
substantial redemption requests if they should occur and
is not for investment purposes. All borrowings will be
repaid before making additional investments for that
Portfolio and any interest paid on such borrowings will
reduce the income of that Portfolio.

The foregoing percentage limitations will apply at the time
of the purchase of a security. Additional investment
limitations are set forth in the Statement of Additional
Information.
THE MANAGER
______________________________________________________________________

SEI Fund Management ("SEI Management"), provides the Trust
with overall management services, regulatory reporting, all
necessary office space, equipment, personnel and
facilities, and acts as dividend disbursing agent and
shareholder servicing agent. SEI Management also serves as
transfer agent (the "Transfer Agent") to Class A shares of
the Trust.

8
<PAGE>
For its management services, SEI Management is
entitled to a fee, which is calculated daily and paid
monthly, at an annual rate of .42% of the average daily net
assets of each Portfolio, except the Institutional Cash
Portfolio, for which SEI Management is entitled to a fee of
.36% of the Portfolio's average daily net assets. SEI
Management has contractually agreed to waive all or a
portion of its fee with respect to each Portfolio, except
the Institutional Cash Portfolio, in order to limit the
total operating expenses of the Class A shares of such
Portfolios to not more than .44% of its average daily net
assets. For the Institutional Cash Portfolio only, this
waiver is voluntary and may be terminated at any time in
SEI Management's sole discretion.

For the fiscal year ended June 30, 1997, the Treasury
Securities, Government Securities, Prime Obligation, and
Institutional Cash Portfolios paid management fees, after
waivers, of .37%, .39%, .37% and .36%, respectively, of
their average daily net assets. As of June 30, 1997, the
Money Market Portfolio had not commenced operations.

THE ADVISER
_______________________________________________________________________

Wellington Management Company, LLP (the "Adviser"), 75
State Street, Boston, Massachusetts 02109, serves as the
investment adviser to each Portfolio. The Adviser, under an
investment advisory agreement with the Trust, invests the
assets of the Portfolios and continuously reviews,
supervises and administers each Portfolio's investment
program, subject to the supervision of, and policies
established by, the Trustees of the Trust.

The Adviser is entitled to a fee, which is calculated
daily and paid monthly, at an annual rate of .075% of the
combined average daily net assets of the Trust's Portfolios
up to $500 million, and .02% of such average daily net
assets in excess of $500 million. Such fees are allocated
daily among the Portfolios of the Trust on the basis of
their relative net assets. For the fiscal year ended June
30, 1997, the Treasury Securities, Government Securities,
Prime Obligation, and Institutional Cash Portfolios paid
advisory fees, after fee waivers, of .04%, .04%, .04%, and
.00%, respectively, of their relative net assets. As of
June 30, 1997, the Money Market Portfolio had not commenced
operations.

9
<PAGE>
DISTRIBUTION AND
SHAREHOLDER
SERVICING
__________________________________________________________________________

SEI Investments Distribution Co. (the "Distributor"), a
wholly-owned subsidiary of SEI Investments Company ("SEI"),
serves as each Portfolio's distributor pursuant to a
distribution agreement with the Trust. The Portfolios have
adopted a shareholder service plan for their Class A shares
(the "Class A Plan").

The Portfolios have adopted a shareholder service
plan for Class A shares (the "Class A Service Plan") under
which firms, including the Distributor, that provide
shareholder and administrative services may receive
compensation therefor. Under the Class A Service Plan, the
Distributor may provide those services itself, or may enter
into arrangements under which third parties provide such
services and are compensated by the Distributor. Under such
arrangements, the Distributor may retain as profit any
difference between the fee it receives and the amount it
pays such third parties. In addition, the Portfolios may
enter into such arrangements directly. Under the Class A
Service Plan, the Distributor is entitled to receive a fee
at a negotiated annual rate of up to .25% of each
Portfolio's average daily net assets attributable to Class
A shares that are subject to the arrangement in return for
provision of a broad range of shareholder and
administrative services, including: maintaining client
accounts; arranging for bank wires; responding to client
inquiries concerning services provided for investments;
changing dividend options; account designations and
addresses; providing sub-accounting; providing information
on share positions to clients; forwarding shareholder
communications to clients; processing purchase, exchange
and redemption orders; and processing dividend payments.

In addition, the Treasury Securities Portfolio has
adopted a distribution plan for its Class D shares (the
"Class D Plan") pursuant to Rule 12b-1 under the Investment
Company Act of 1940, as amended (the "1940 Act").

It is possible that an institution may offer
different classes of shares to its customers and thus
receive different compensation with respect to different
classes. These financial institutions may also charge
separate fees to their customers.

The Trust may also execute brokerage or other agency
transactions through the Distributor for which the
Distributor may receive usual and customary compensation.

The Distributor may, from time to time and at its own
expense, provide promotional incentives, in the form of
cash or other compensation, to certain financial
institutions whose representatives have sold or are
expected to sell significant amounts of the Portfolios'
shares.

10
<PAGE>
PURCHASE AND
REDEMPTION OF SHARES
____________________________________________________________________________

Financial institutions may acquire Class A shares of the
Portfolios for their own account, or as a record owner on
behalf of fiduciary, agency or custody accounts, by placing
orders with the Transfer Agent. Institutions that use
certain SEI proprietary systems may place orders
electronically through those systems. Financial
institutions may impose an earlier cut-off time for receipt
of purchase orders directed through them to allow time for
processing and transmittal of these orders to the Transfer
Agent for effectiveness on the same day. Financial
institutions which purchase shares for the accounts of
their customers may impose separate charges on these
customers for account services.

Shares of each Portfolio may be purchased or redeemed
on days on which the New York Stock Exchange is open for
business ("Business Days"). However, money market fund
shares cannot be purchased by Federal Reserve wire on
Federal holidays on which wire transfers are restricted.

Shareholders who desire to purchase shares must place
their orders with the Transfer Agent (or its authorized
agent) prior to 2:00 p.m., Eastern time (12:00 p.m.,
Eastern time, for the Institutional Cash Portfolio), on any
Business Day for the order to be accepted on that Business
Day. Cash investments must be transmitted or delivered in
federal funds to the wire agent by the close of business on
the same day the order is placed. The Trust reserves the
right to reject a purchase order when the Distributor
determines that it is not in the best interest of the Trust
or shareholders to accept such purchase order.

The Trust will send shareholders a statement after
each purchase or redemption transaction. The purchase price
of shares is the net asset value next determined after a
purchase order is received and accepted by the Trust. The
net asset value per share of each Portfolio is determined
by dividing the total market value of the Portfolio's
investments and other assets, less any liabilities, by the
total number of outstanding shares of that Portfolio. Net
asset value per share is determined daily as of 2:00 p.m.,
Eastern time (12:00 p.m., Eastern time, for the
Institutional Cash Portfolio), on each Business Day.

Shareholders who desire to redeem shares of a
Portfolio must place their redemption orders with the
Transfer Agent (or its authorized agent) prior to 2:00
p.m., Eastern time (12:00 p.m., Eastern time, for the
Institutional Cash Portfolio), on any Business Day. The
redemption price is the net asset value per share of the
Portfolio next determined after receipt by the Transfer
Agent of the redemption order. Payment on redemptions will
be made as promptly as possible and, in any event, within
seven days after the redemption order is received.

Purchase and redemption orders may be placed by
telephone. Neither the Trust nor the Trust's Transfer Agent
will be responsible for any loss, liability, cost or
expense for acting upon wire instructions or upon telephone
instructions that it reasonably believes to

11
<PAGE>
be genuine. The Trust and the Trust's Transfer Agent will
each employ reasonable procedures to confirm that
instructions communicated by telephone are genuine,
including requiring a form of personal identification prior
to acting upon instructions received by telephone and
recording telephone instructions.

If market conditions are extraordinarily active, or
other extraordinary circumstances exist, shareholders may
experience difficulties placing redemption orders by
telephone, and may wish to consider placing orders by other
means.
PERFORMANCE
______________________________________________________________________

From time to time, the Portfolios may advertise "current
yield" and "effective compound yield." These figures will
fluctuate, as they are based on historical earnings and are
not intended to indicate future performance. The "current
yield" of the Portfolios refers to the income generated by
an investment over a seven-day period which is then
"annualized." That is, the amount of income generated by an
investment during that week is assumed to be generated each
week over a 52-week period, and is shown as a percentage of
the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an
investment is assumed to be reinvested. The "effective
yield" will be slightly higher than the "current yield"
because of the compounding effect of this assumed
reinvestment.

A Portfolio may periodically compare its performance
to that of: (i) other mutual funds tracked by mutual fund
rating services (such as Lipper Analytical), financial and
business publications and periodicals; (ii) broad groups of
comparable mutual funds; (iii) unmanaged indices which may
assume investment of dividends but generally do not reflect
deductions for administrative and management costs; or (iv)
other investment alternatives.

The performance of the Class A shares will normally
be higher than the performance of the Class D shares of a
Portfolio because of additional distribution and transfer
agent expenses charged to Class D shares.

TAXES
______________________________________________________________________________

12
<PAGE>
treatment afforded regulated investment companies under
Subchapter M of the Internal Revenue Code of 1986, as
amended, so as to be relieved of federal income tax on net
investment company taxable income and net capital gains
(the excess of net long-term capital gain over net
short-term capital losses) distributed to shareholders.
TAX STATUS OF
DISTRIBUTIONS

Each Portfolio distributes substantially all of its net
investment income (including net short-term capital gains)
to shareholders. Dividends from a Portfolio's net
investment income are taxable to its shareholders as
ordinary income (whether received in cash or in additional
shares). Distributions of net capital gains are taxable to
shareholders as gain from the sale or exchange of a capital
asset held for more than one year regardless of how long
shareholders have held their shares and regardless of
whether the distributions are received in cash or in
additional shares. Dividends and distributions of capital
gains paid by each Portfolio do not qualify for the
dividends-received deduction for corporate shareholders.
Each Portfolio will provide annual reports to shareholders
of the federal income tax status of all distributions.

Dividends declared by a Portfolio in October,
November or December of any year and payable to
shareholders of record on a date in such a month will be
deemed to have been paid by the Portfolio and received by
the shareholders on December 31 of the year declared if
paid by the Portfolio at any time during the following
January.

Each Portfolio intends to make sufficient
distributions prior to the end of each calendar year to
avoid liability for the federal excise tax applicable to
regulated investment companies.

With respect to investments in U.S. Treasury STRIPS,
which are sold at original issue discount and thus do not
make periodic cash interest payments, each Portfolio will
be required to include as part of its current income, the
imputed interest on such obligations even though the
Portfolio has not received any interest payments on such
obligations during that period. Because each Portfolio
distributes all of its net investment income to its
shareholders, a Portfolio may have to sell portfolio
securities in order to distribute such imputed income,
which may occur at a time when the Adviser would not have
chosen to sell such securities and, which may result in a
taxable gain or loss.

Investment income received by the Portfolios on
direct U.S. Government obligations is exempt from tax at
the state level when received directly by a Portfolio, and
may be exempt, depending on the state, when received by a
shareholder as income dividends from any Portfolio provided
certain state-specific conditions are satisfied. Interest
received on repurchase agreements collateralized by U.S.
Government obligations normally is not exempt from state
taxation. Each Portfolio will inform shareholders annually
of the percentage of income and distributions derived from
direct U.S. Government obligations. Shareholders should
consult their tax advisers to determine whether any portion
of the income dividends received from a Portfolio is
considered tax exempt in their particular states.

Each sale, exchange, or redemption of any Portfolio's
shares is a taxable transaction to the shareholder.

13
<PAGE>
GENERAL INFORMATION
_______________________________________________________________________
THE TRUST
SEI Liquid Asset Trust (the "Trust") was organized as a
Massachusetts business trust under a Declaration of Trust
dated July 20, 1981. The Declaration of Trust permits the
Trust to offer separate Portfolios of shares and different
classes of each Portfolio. All consideration received by
the Trust for shares of any portfolio and all assets of
such portfolio belong to that portfolio or class and are
subject to liabilities related thereto.

The Trust pays its expenses, including fees of its
service providers, audit and legal expenses, expenses of
preparing prospectuses, proxy solicitation material and
reports to shareholders, costs of custodial services and
registering the shares under federal and state securities
laws, pricing, insurance expenses, litigation and other
extraordinary expenses, brokerage costs, interest charges,
taxes and organization expenses.
TRUSTEES OF THE TRUST
The management and affairs of the Trust are supervised by
the Trustees under the laws of the Commonwealth of
Massachusetts. The Trustees have approved contracts under
which, as described above, certain companies provide
essential management services to the Trust.
VOTING RIGHTS

Each share held entitles the shareholder of record to one
vote. The shareholders of each Portfolio or class of the
Trust will vote separately on matters relating solely to
that Portfolio or class. As a Massachusetts business trust,
the Trust is not required to hold annual meetings of
shareholders, but approval will be sought for certain
changes in the operation of the Trust and for the election
of Trustees under certain circumstances. In addition, a
Trustee may be removed by the remaining Trustees or by
shareholders at a special meeting called upon written
request of shareholders owning at least 10% of the
outstanding shares of the Trust. In the event that such a
meeting is requested, the Trust will provide appropriate
assistance and information to the shareholders requesting
the meeting.

REPORTING
The Trust issues unaudited financial statements
semi-annually and audited financial statements annually.
The Trust furnishes proxy statements and other reports to
shareholders of record.
SHAREHOLDER INQUIRIES

Shareholder inquiries should be directed to the Manager,
SEI Fund Management, Oaks, Pennsylvania 19456.

DIVIDENDS

Substantially all of the net investment income (exclusive
of capital gains) of each Portfolio is periodically
declared and paid as a dividend. Dividends are paid by the
Portfolio in federal funds or in additional shares at the
discretion of the shareholder on the first Business Day of
each month. Dividends will be paid on the next Business Day
to shareholders who redeem all of their shares of a
Portfolio at any other time during the month. Currently,
capital gains (the excess of net long-term capital gain
over net short-term capital loss) realized, if any, are
distributed at least annually.

14
<PAGE>
COUNSEL AND INDEPENDENT
ACCOUNTANTS
Morgan, Lewis & Bockius LLP serves as counsel to the Trust.
Price Waterhouse LLP serves as the independent accountants
to the Trust.
CUSTODIAN AND WIRE AGENT
CoreStates Bank, N.A., Broad and Chestnut Streets, P.O. Box
7618, Philadelphia, Pennsylvania 19101 (the "Custodian"),
serves as custodian of the Trust's assets and as wire agent
of the Trust. The Custodian holds cash, securities and
other assets of the Trust as required by the 1940 Act.

DESCRIPTION OF
PERMITTED
INVESTMENTS AND RISK
FACTORS ______________________________________________________________________

The following is a description of certain of the permitted
investments for the Portfolios, and the associated risk
factors:
BANK NOTES
Bank notes are notes used to represent debt obligations
issued by banks in large denominations.
BANKERS' ACCEPTANCE

A bankers' acceptance is a bill of exchange or time drafts
drawn on and accepted by a commercial bank. Bankers'
acceptances are used by corporations to finance the
shipment and storage of goods. Maturities are generally six
months or less.

CERTIFICATES OF DEPOSIT

Certificates of deposit are interest-bearing instruments
with a specific maturity. They are issued by banks and
savings and loan institutions in exchange for the deposit
of funds, and normally can be traded in the secondary
market prior to maturity. Certificates of deposit with
penalties for early withdrawal will be considered illiquid.

COMMERCIAL PAPER

Commercial paper is the term used to designate unsecured
short-term promissory notes issued by municipalities,
corporations and other entities. Maturities on these issues
vary from one to 270 days.

DEMAND INSTRUMENTS

Certain instruments may entail a demand feature which
permits the holder to demand payment of the principal
amount of the instrument. Demand instruments may include
variable amount master demand notes.

FOREIGN SECURITIES

The Money Market Portfolio may invest in U.S. dollar
denominated obligations, including (i) commercial paper of
issuers domiciled outside of the United States ("Yankees"),
(ii) securities issued by foreign branches of U.S.
commercial banks and of U.S. and London branches of foreign
banks, and (iii) obligations and securities of foreign
governments, including Canadian and Provincial Government
and Crown Agency obligations. The Adviser will attempt to
minimize the risks associated with investing in foreign
obligations by investing only in those instruments which
satisfy the quality and maturity restrictions applicable to
the Portfolio.

ILLIQUID SECURITIES

Illiquid securities are securities which cannot be disposed
of within seven business days at approximately the price at
which they are being carried on a Portfolio's books.
Illiquid

15
<PAGE>

securities may include demand instruments with demand
notice periods exceeding seven days, securities for which
there is no active secondary market, and repurchase
agreements with maturities or durations of more than seven
days in length.

REPURCHASE AGREEMENTS

Repurchase agreements are agreements by which a Portfolio
obtains a security and simultaneously commits to return the
security to the seller at an agreed upon price on an agreed
upon date within a number of days from the date of
purchase. The Portfolio will have actual or constructive
possession of the securities held as collateral for the
repurchase agreement. A Portfolio bears a risk of loss in
the event the other party defaults on its obligations and
the Portfolio is delayed or prevented from exercising its
right to dispose of the collateral securities or if the
Portfolio realizes a loss on the sale of the collateral. A
Portfolio will enter into repurchase agreements only with
financial institutions deemed to present minimal risk of
bankruptcy during the term of the agreement based on
established guidelines. Repurchase agreements are
considered loans under the 1940 Act.

RESTRICTED SECURITIES

Restricted securities are securities that may not be sold
freely to the public absent registration under the
Securities Act of 1933 or an exemption from registration.
Rule 144A securities are securities that have not been
registered under the Securities Act of 1933, but which may
be traded between certain institutional investors,
including investment companies. The Trust's Board of
Trustees is responsible for developing guidelines and
procedures for determining the liquidity of restricted
securities and monitoring the Adviser's implementation of
the guidelines and procedures.

TAXABLE MUNICIPAL
SECURITIES

Taxable Municipal Securities are Municipal Securities the
interest on which is not exempt from federal income tax.
Taxable Municipal Securities include "private activity
bonds" that are issued by or on behalf of states or
political subdivisions thereof to finance privately-owned
or operated facilities for business and manufacturing,
housing, sports, and pollution control and to finance
activities of and facilities for charitable institutions.
Private activity bonds are also used to finance public
facilities such as airports, mass transit systems, ports,
parking lots, and low income housing. The payment of the
principal and interest on private activity bonds is not
backed by a pledge of tax revenues, and is dependent solely
on the ability of the facility's user to meet its financial
obligations, and may be secured by a pledge of real and
personal property so financed. Interest on these bonds may
not be exempt from federal income tax.

TIME DEPOSITS

Time deposits are non-negotiable receipts issued by a bank
in exchange for the deposit of funds. Like a certificate of
deposit, it earns a specified rate of interest over a
definite period of time; however, it cannot be traded in
the secondary market. Time deposits with maturities of more
than seven days are considered to be illiquid.

U.S. GOVERNMENT AGENCY
OBLIGATIONS
Certain federal agencies, such as the Government National
Mortgage Association ("GNMA"), have been established as
instrumentalities of the U.S. Government to supervise and
finance certain types of activities. Issues of these
agencies, while not direct obligations

16
<PAGE>

of the U.S. Government, are either backed by the full faith
and credit of the United States (such as GNMA securities)
or supported by the issuing agency's right to borrow from
the Treasury. The issues of other agencies are supported
only by the credit of the instrumentality (such as Fannie
Mae securities). Any guarantee by the U.S. Government
agencies or instrumentalities of all securities in which a
Portfolio invests guarantees only the payment of principal
and interest on the guaranteed security and does not
guarantee the yield or value of the security or the yield
or value of shares of that Portfolio.

U.S. TREASURY
OBLIGATIONS
U.S. Treasury obligations consist of bills, notes and bonds
issued by the U.S. Treasury, as well as separately traded
interest and principal component parts of such obligations,
known as Separately Traded Registered Interest and
Principal Securities ("STRIPS"), that are transferable
through the federal book-entry system.

STRIPS are sold as zero coupon securities, which
means that they are sold at a substantial discount and
redeemed at face value at their maturity date without
interim payments of interest or principal. This discount is
accreted over the life of the security, and such accretion
will constitute the income earned on the security for both
accounting and tax purposes. Because of these features,
such securities may be subject to greater interest rate
volatility than interest-paying investments.

VARIABLE AND FLOATING
RATE INSTRUMENTS
Certain of the obligations purchased by a Portfolio may
carry variable or floating rates of interest and may
involve a conditional or unconditional demand feature. Such
obligations may include variable amount master demand
notes. Such instruments bear interest at rates which are
not fixed, but which vary with changes in specified market
rates or indices. The interest rates on these securities
may be reset daily, weekly, quarterly or at some other
interval, and may have a floor or ceiling on interest rate
changes. There is a risk that the current interest rate on
such obligations may not accurately reflect existing market
interest rates. A demand instrument with a demand notice
period exceeding seven days may be considered illiquid if
there is no secondary market for such security.
WHEN-ISSUED AND DELAYED
DELIVERY SECURITIES

When-issued or delayed delivery transactions involve the
purchase of an instrument with payment and delivery taking
place in the future. Delivery of and payment for these
securities may occur a month or more after the date of the
purchase commitment. A Portfolio will maintain with the
custodian a separate account with liquid securities or cash
in an amount at least equal to these commitments. The
interest rate realized on these securities is fixed as of
the purchase date, and no interest accrues to a Portfolio
before settlement.

17
<PAGE>
TABLE OF CONTENTS
_________________________________________________________________

<TABLE>
<S> <C>
Annual Operating Expenses................................................. 2
Financial Highlights...................................................... 3
The Trust................................................................. 5
Investment Objectives and Policies........................................ 5
General Investment Policies............................................... 7
Investment Limitations.................................................... 8
The Manager............................................................... 8
The Adviser............................................................... 9
Distribution and Shareholder Servicing.................................... 10
Purchase and Redemption of Shares......................................... 11
Performance............................................................... 12
Taxes..................................................................... 12
General Information....................................................... 14
Description of Permitted Investments and Risk Factors..................... 15
</TABLE>

18
<PAGE>
PROSPECTUS

OCTOBER 30, 1997

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

TREASURY SECURITIES PORTFOLIO

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

Please read this prospectus carefully before investing, and keep it on file for
future reference. It contains information that can help you decide if the
Portfolio's investment goals match your own.

A Statement of Additional Information dated October 30, 1997, has been filed
with the Securities and Exchange Commission and is available upon request and
without charge by writing the Distributor, SEI Investments Distribution Co.,
Oaks, Pennsylvania 19456, or by calling 1-800-437-6016. The Statement of
Additional Information is incorporated by reference into this Prospectus.

SEI Liquid Asset Trust (the "Trust") is an open-end management investment
company, certain classes of which offer shareholders a convenient means of
investing their funds in one or more professionally managed diversified
portfolios of securities. The Treasury Securities Portfolio offers two classes
of shares, Class A shares and Class D shares. Class D shares differ from Class A
shares primarily in the allocation of certain distribution expenses and transfer
agent fees. Class D shares are available through SEI Investments Distribution
Co. (the Trust's distributor), and through participating broker-dealers,
financial institutions and other organizations. This Prospectus offers Class D
shares of the Trust's Treasury Securities Portfolio (the "Portfolio").

AN INVESTMENT IN THE PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIO WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.

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

THE TRUST'S SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK. THE SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY. INVESTMENT IN THE SHARES INVOLVES RISK, INCLUDING POSSIBLE
LOSS OF THE PRINCIPAL AMOUNT INVESTED.
<PAGE>
HOW TO READ THIS PROSPECTUS
- --------------------------------------------------------------------------------

This Prospectus provides information that you should know about the Portfolio
before investing. Brief descriptions are also provided throughout the Prospectus
to better explain certain key points. To find these helpful guides, look for
this symbol.[>]

FUND HIGHLIGHTS
- --------------------------------------------------------------------------------

The following summary provides basic information about the Class D shares of the
Trust's Treasury Securities Portfolio. This summary is qualified in its entirety
by reference to the more detailed information provided elsewhere in this
Prospectus and in the Statement of Additional Information.

INVESTMENT OBJECTIVE
AND POLICIES
The Treasury Securities Portfolio seeks to preserve
principal value and maintain a high degree of liquidity
while providing current income. See "Investment Objective
and Policies" and "Description of Permitted Investments and
Risk Factors."

UNDERSTANDING RISK
There can be no assurance that
the Portfolio will achieve its
investment objective. See
"Investment Objective and
Policies" and "Description of
Permitted Investments and Risk
Factors."

MANAGEMENT PROFILE

Wellington Management Company,
LLP (the "Adviser") serves as
the investment adviser to the
Portfolio. The Adviser is a
professional investment
counseling firm that has been
providing investment advisory
services to mutual funds since
1933. SEI Fund Management serves
as the manager and shareholder
servicing agent of the Trust
(the "Manager"). DST Systems,
Inc. ("DST") serves as transfer
agent (the "Transfer Agent") and
dividend disbursing agent for
the Class D shares of the Trust.
SEI Investments Distribution Co.
serves as distributor (the
"Distributor") of the Trust's
shares. See "The Manager", "The
Adviser" and "Distribution."

...........................................................................

<TABLE>
<S> <C>
FUND HIGHLIGHTS................................... 2
TABLE OF CONTENTS
PORTFOLIO EXPENSES................................ 4
FINANCIAL HIGHLIGHTS.............................. 5
YOUR ACCOUNT AND DOING BUSINESS WITH US........... 6
INVESTMENT OBJECTIVE AND POLICIES................. 9
GENERAL INVESTMENT POLICIES....................... 9
INVESTMENT LIMITATIONS............................ 9
THE MANAGER....................................... 10
THE ADVISER....................................... 11
DISTRIBUTION...................................... 11
PERFORMANCE....................................... 12
TAXES............................................. 13
ADDITIONAL INFORMATION ABOUT DOING BUSINESS WITH
US........................................... 15
GENERAL INFORMATION............................... 17
DESCRIPTION OF PERMITTED INVESTMENTS AND RISK
FACTORS...................................... 19
</TABLE>

...........................................................................

2
<PAGE>
YOUR ACCOUNT AND
DOING BUSINESS WITH
US

You may open an account with just $1,000, and make
additional investments with as little as $100. Redemptions
of the Portfolio's shares are made at net asset value per
share. See "Purchase of Shares" and "Redemption of Shares."

DIVIDENDS
Substantially all of the net
investment income (exclusive of
capital gains) of the Portfolio
is distributed in the form of
dividends that will be declared
daily and paid monthly on the
first Business Day of each
month. Any realized net capital
gain is distributed at least
annually. Distributions are paid
in additional shares unless you
elect to take the payment in
cash. See "Dividends."

INFORMATION/SERVICE
CONTACTS
For more information about Class
D shares, call SEI Financial
Services Company at
1-800-437-6016.
...........................................................................
[>] INVESTMENT PHILOSOPHY
BELIEVING THAT NO SINGLE INVESTMENT ADVISER CAN DELIVER OUTSTANDING PERFORMANCE
IN EVERY INVESTMENT CATEGORY, ONLY THOSE ADVISERS WHO HAVE DISTINGUISHED
THEMSELVES WITHIN THEIR AREAS OF SPECIALIZATION ARE SELECTED TO ADVISE OUR
MUTUAL FUNDS.
...........................................................................

3
<PAGE>
PORTFOLIO EXPENSES
- --------------------------------------------------------------------------------

The purpose of the following table is to help you understand the various costs
and expenses that you, as a shareholder, will bear directly or indirectly in
connection with an investment in Class D shares.

SHAREHOLDER TRANSACTION EXPENSES (AS A PERCENTAGE OF OFFERING PRICE)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
TREASURY
SECURITIES
PORTFOLIO
----------
<S> <C>
Maximum Sales Charge Imposed on Purchases None
Maximum Sales Charge Imposed on Reinvested Dividends None
Redemption Fees (1) None
</TABLE>

ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
Management/Advisory Fees (AFTER FEE WAIVER) (2) .41%
12b-1 Fees (AFTER FEE WAIVERS) (3) .20%
Other Expenses .18%
- ------------------------------------------------------------------------
Total Operating Expenses (AFTER FEE WAIVERS) (2)(3)(4) .79%
- ------------------------------------------------------------------------
</TABLE>

(1) A CHARGE, CURRENTLY $10.00, IS IMPOSED ON WIRES OF REDEMPTION PROCEEDS OF
THE PORTFOLIO'S CLASS D SHARES.

(2) THE MANAGER HAS AGREED TO WAIVE ITS FEE IN AN AMOUNT NECESSARY TO LIMIT THE
TOTAL OPERATING EXPENSES FOR CLASS D SHARES, AND THE TOTAL OPERATING
EXPENSES SHOWN REFLECT THIS WAIVER. ABSENT WAIVERS, MANAGEMENT/ADVISORY FEES
WOULD HAVE BEEN .45%.

(3) THE DISTRIBUTOR HAS WAIVED, ON A VOLUNTARY BASIS, A PORTION OF ITS 12b-1
FEE, AND THE 12b-1 FEES SHOWN REFLECT THIS WAIVER. THE DISTRIBUTOR RESERVES
ITS RIGHT TO TERMINATE THIS WAIVER AT ANY TIME IN ITS SOLE DISCRETION.
ABSENT SUCH WAIVER, 12b-1 FEES WOULD BE .25% FOR THE PORTFOLIO.

(4) ABSENT WAIVERS, TOTAL OPERATING EXPENSES OF THE CLASS D SHARES OF THE
PORTFOLIO WOULD BE .88%. ADDITIONAL INFORMATION MAY BE FOUND UNDER THE
MANAGER, THE ADVISER AND DISTRIBUTION.

EXAMPLE
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
3 5 10
1 YR. YRS. YRS. YRS.
----- ----- ----- -----
<S> <C> <C> <C> <C>
An investor in the Class D shares of the Portfolio would pay
the following expenses on a $1,000 investment assuming (1)
a 5% annual return and (2) redemption at the end of each
time period:
Treasury Securities Portfolio $ 8 $ 25 $ 44 $ 98
- ----------------------------------------------------------------------------------------
</TABLE>

THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES. ACTUAL
EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.

THE INFORMATION SET FORTH IN THE FOREGOING TABLE AND EXAMPLE RELATES ONLY TO THE
CLASS D SHARES. THE PORTFOLIO ALSO OFFERS CLASS A SHARES, WHICH ARE SUBJECT TO
THE SAME EXPENSES, EXCEPT THERE ARE NO TRANSFER AGENT COSTS, AND THERE ARE
SHAREHOLDER SERVICING COSTS. A PERSON WHO PURCHASES SHARES THROUGH AN ACCOUNT
WITH A FINANCIAL INSTITUTION MAY BE CHARGED SEPARATE FEES BY THAT INSTITUTION.
ADDITIONAL INFORMATION MAY BE FOUND UNDER "THE MANAGER," "THE ADVISER" AND
"DISTRIBUTION." LONG-TERM SHAREHOLDERS MAY PAY MORE THAN THE ECONOMIC EQUIVALENT
OF THE MAXIMUM FRONT-END SALES CHARGE OTHERWISE PERMITTED BY THE CONDUCT RULES
OF THE NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. (THE "NASD").

4
<PAGE>

FINANCIAL HIGHLIGHTS

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

FOR A CLASS D SHARE OUTSTANDING THROUGHOUT THE PERIOD

<TABLE>
<CAPTION>
NET ASSET DISTRIBUTIONS
VALUE NET REALIZED AND FROM NET DISTRIBUTIONS NET ASSET NET ASSETS
BEGINNING INVESTMENT UNREALIZED GAINS INVESTMENT FROM REALIZED VALUE END TOTAL END OF
OF PERIOD INCOME ON SECURITIES INCOME CAPITAL GAINS OF PERIOD RETURN PERIOD (000)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------
TREASURY
SECURITIES
- ------------------
1997 $ 1.00 $ 0.05 $ -- $(0.05) $ -- $ 1.00 4.73% $ 216
1996 1.00 0.05 -- (0.05) -- 1.00 5.01 219
1995 1.00 0.05 -- (0.05) -- 1.00 4.69 9.798
1994 (1) 1.00 0.01 -- (0.01) -- 1.00 0.50** 23

<CAPTION>
RATIO OF NET
RATIO OF RATIO OF INVESTMENT
NET EXPENSE TO INCOME TO
RATIO OF INVESTMENT AVERAGE AVERAGE NET
EXPENSES INCOME TO NET ASSETS ASSETS
TO AVERAGE AVERAGE (EXCLUDING (EXCLUDING
NET ASSETS NET ASSETS WAIVERS) WAIVERS)
- ------------------
<S> <C> <C> <C> <C>
- ------------------
TREASURY
SECURITIES
- ------------------
1997 0.79% 4.64% 1.09% 4.34%
1996 0.79 4.92 0.87 4.84
1995 0.79 5.15 0.89 5.05
1994 (1) 0.79* 3.23* 0.98* 3.04*
</TABLE>

(1) TREASURY SECURITIES CLASS D COMMENCED OPERATIONS ON MAY 4, 1994.

* ANNUALIZED

** NOT ANNUALIZED

AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.

5
<PAGE>
YOUR ACCOUNT AND DOING BUSINESS WITH US
- --------------------------------------------------------------------------------

Class D shares of the Portfolio are sold on a continuous basis and may be
purchased directly from the Trust's Distributor, SEI Investments Distribution
Co. Shares may also be purchased through financial institutions, broker-dealers,
or other organizations which have established a dealer agreement or other
arrangement with the Distributor ("Intermediaries"). For more information about
the following topics, see "Additional Information About Doing Business with Us."

- --------------------------------------------------------------------------------
HOW TO BUY, SELL AND
EXCHANGE SHARES
THROUGH
INTERMEDIARIES

Class D shares of the Portfolio may be purchased through
Intermediaries. Contact your Intermediary for information
on how to buy, sell and exchange shares. To allow for
processing and transmittal of orders to the Transfer Agent
(or its authorized agent) on the
same day, Intermediaries may
impose earlier cut-off times for
receipt of purchase orders.
Certain Intermediaries may
charge customer account fees.
Information concerning any
charges will be provided to the
customer by the Intermediary.

The shares you purchase
through an Intermediary may be
held "of record" by that
Intermediary. If you want to
transfer the registration of
shares beneficially owned by
you, but held "of record" by an
Intermediary, you should call
the Intermediary to request this change.
...........................................................................
[>] WHAT IS AN INTERMEDIARY?
ANY ENTITY, SUCH AS A BANK, BROKER-DEALER, OTHER FINANCIAL INSTITUTION,
ASSOCIATION OR ORGANIZATION WHICH HAS ENTERED INTO AN ARRANGEMENT WITH THE
DISTRIBUTOR TO SELL CLASS D SHARES TO ITS CUSTOMERS.
...........................................................................

HOW TO BUY SHARES
FROM THE DISTRIBUTOR

Application forms can be obtained by calling
1-800-437-6016.

OPENING AN ACCOUNT BY
CHECK

You may buy Class D shares by mailing a completed
application and a check (or other negotiable bank
instrument or money order) payable to "Class D (Treasury
Securities Portfolio)". If you send a check that does not
clear, the purchase will be canceled and you could be
liable for any losses or fees incurred. Third-party checks,
credit cards, credit card checks and cash will not be
accepted. When purchases are made by check (including
certified or cashier's checks), redemption proceeds will
not be forwarded until the check providing for the
investment being redeemed has cleared (which may take up to
15 days).

BY FED WIRE

To buy shares by Fed Wire, call the Transfer Agent
toll-free at 1-800-437-6016.

AUTOMATIC INVESTMENT
PLAN ("AIP")
You may systematically buy Class D shares through
deductions from your checking or savings account, provided
these accounts are maintained through banks which are part
of the Automated Clearing House ("ACH") system. You may
purchase shares on a fixed schedule (semi-monthly or
monthly) with amounts as low as $25, or as high as
$100,000. Upon notice, the amount you commit to the AIP may
be changed or canceled at any time. The AIP is subject to
account minimum initial purchase amounts and minimum
balance maintenance requirements.

6
<PAGE>
EXCHANGING SHARES
WHEN CAN YOU
EXCHANGE SHARES?

Once payment for your shares has been received and accepted
(I.E., an account has been established), you may exchange
some or all of your shares for Class D shares of SEI
International Trust, SEI Tax Exempt Trust and SEI
Institutional Managed Trust ("SEI Funds"). Exchanges are
made at net asset value plus any applicable sales charge.

WHEN DO SALES CHARGES
APPLY TO AN EXCHANGE?
SEI Funds' portfolios that are
not money market portfolios
currently impose a sales charge
on Class D shares. If you
exchange into one of these
non-money market portfolios, you
will have to pay a sales charge
on any portion of your exchanged
Class D shares for which you
have not previously paid a sales
charge.

If you previously paid a
sales charge on your Class D
shares, no additional sales
charge will be assessed when you
exchange those Class D shares
for other Class D shares.

If you buy Class D shares
of a "non-money market" fund and
you receive a sales charge
waiver, you will be deemed to
have paid the sales charge for purposes of this exchange
privilege. In calculating any sales charge payable on your
exchange, the Trust will assume that the first shares you
exchange are those on which you have already paid a sales
charge. Sales charge waivers may also be available under
certain circumstances described in the SEI Funds'
prospectuses.
...........................................................................
[>] HOW DOES AN EXCHANGE TAKE PLACE?
WHEN MAKING AN EXCHANGE, YOU AUTHORIZE THE SALE OF YOUR SHARES OF ONE OR MORE
PORTFOLIOS IN ORDER TO PURCHASE THE SHARES OF ANOTHER PORTFOLIO. IN OTHER WORDS,
YOU ARE EXECUTING A SELL ORDER AND THEN A BUY ORDER. THIS SALE OF YOUR SHARES IS
A TAXABLE EVENT WHICH COULD RESULT IN A TAXABLE GAIN OR LOSS.
...........................................................................

The Trust reserves the right to change the terms and
conditions of the exchange privilege discussed herein, or
to terminate the exchange privilege, upon 60 days' notice.
The Trust also reserves the right to deny an exchange
request made within 60 days of the purchase of a "non-money
market" portfolio.
REQUESTING AN EXCHANGE
OF SHARES
To request an exchange, you must provide proper
instructions in writing to the Transfer Agent. Telephone
exchanges will also be accepted if you previously elected
this option on your account application.

In the case of shares held "of record" by an
Intermediary but beneficially owned by you, you should
contact the Intermediary who will contact the Transfer
Agent and effect the exchange on your behalf.

HOW TO SELL SHARES
THROUGH THE
DISTRIBUTOR

To sell your shares, a written request for redemption in
good order must be received by the Transfer Agent (or its
authorized agent). Valid written redemption requests will
be effective on receipt. All shareholders of record must
sign the redemption request. The Transfer Agent may require
that the signatures on written requests be guaranteed.

BY MAIL
For information about the proper form of redemption
requests, call 1-800-437-6016. You may also have the
proceeds mailed to an address of record or mailed (or sent
by ACH) to a commercial bank account previously designated
on the Account Application or specified

7
<PAGE>
by written instruction to the Transfer Agent. There is no
charge for having redemption requests mailed to a
designated bank account.
BY TELEPHONE
You may sell your shares by
telephone if you previously
elected that option on the
Account Application. You may
have the proceeds mailed to the
address of record, wired or sent
by ACH to a commercial bank
account previously designated on
the Account Application. Under
most circumstances, payments
will be transmitted on the next
Business Day following receipt
of a valid telephone request for
redemption. Wire redemption
requests may be made by calling
1-800-437-6016. A wire
redemption charge (presently
$10.00) will be deducted from
the amount of the redemption.
...........................................................................
[>] WHAT IS A SIGNATURE GUARANTEE?
A SIGNATURE GUARANTEE VERIFIES THE AUTHENTICITY OF YOUR SIGNATURE AND MAY BE
OBTAINED FROM ANY OF THE FOLLOWING: BANKS, BROKERS, DEALERS, CERTAIN CREDIT
UNIONS, SECURITIES EXCHANGE OR ASSOCIATION, CLEARING AGENCY OR SAVINGS
ASSOCIATION. A NOTARY PUBLIC CANNOT PROVIDE A SIGNATURE GUARANTEE.
...........................................................................
SYSTEMATIC WITHDRAWAL
PLAN ("SWP")
You may establish a systematic withdrawal plan for an
account with a $10,000 minimum balance. Under the plan,
redemptions can be automatically processed from accounts
(monthly, quarterly, semi-annually or annually) by check or
by ACH with a minimum redemption amount of $50.
CHECK-WRITING

Check-Writing Service is offered free of charge to Class D
shareholders of the Portfolio. You may redeem shares by
writing checks on your account for $500 or more. Once you
have signed and returned a signature card, you will receive
a supply of checks. A check may be made payable to any
person, and your account will continue to earn dividends
until the check clears.

Because of the difficulty of determining in advance
the exact value of your account, you may not use a check to
close your account. The checks are free, but your account
will be charged a fee for stopping payment of a check upon
your request or if the check cannot be honored because of
insufficient funds or other valid reasons.

8
<PAGE>
INVESTMENT OBJECTIVE
AND POLICIES
___________________________________________________________________________
TREASURY SECURITIES
PORTFOLIO
The investment objective of the
Treasury Securities Portfolio is
to preserve principal value and
maintain a high degree of
liquidity while providing
current income.

The Treasury Securities
Portfolio invests exclusively in
U.S. Treasury obligations and
repurchase agreements involving
such obligations. The repurchase
agreement dealers selected for
the Portfolio must meet certain
creditworthiness criteria
established by Standard & Poor's
Corporation ("S&P").

There can be no assurance
that the Portfolio will achieve
its investment objective.
...........................................................................
[>] WHAT ARE INVESTMENT OBJECTIVES AND POLICIES?
A PORTFOLIO'S INVESTMENT OBJECTIVE IS A STATEMENT OF WHAT IT SEEKS TO ACHIEVE.
IT IS IMPORTANT TO MAKE SURE THAT THE INVESTMENT OBJECTIVE MATCHES YOUR OWN
FINANCIAL NEEDS AND CIRCUMSTANCES. THE INVESTMENT POLICIES SECTION SPELLS OUT
THE TYPES OF SECURITIES IN WHICH THE PORTFOLIO INVESTS.
...........................................................................

GENERAL INVESTMENT
POLICIES
___________________________________________________________________________

In purchasing obligations, the Portfolio complies with the
requirements of Rule 2a-7 under the 1940 Act, as that Rule
may be amended from time to time. These requirements
currently provide that the Portfolio must limit its
investments to securities with remaining maturities of 397
days or less, and must maintain a dollar-weighted average
maturity of 90 days or less.

For additional information regarding the Portfolio's
permitted investments, see "Description of Permitted
Investments and Risk Factors" and the Statement of
Additional Information.

INVESTMENT
LIMITATIONS
________________________________________________________________________

The investment objective and certain of the investment
limitations are fundamental policies of the Portfolio.
Fundamental policies cannot be changed with respect to the
Portfolio without the consent of the holders of a majority
of the Portfolio's outstanding shares. It is a fundamental
policy of the Portfolio to use its best efforts to maintain
a constant net asset value of $1.00 per share.

THE PORTFOLIO MAY NOT:

1. Purchase securities of any issuer (except securities
issued or guaranteed by the U.S. Government, its
agencies or instrumentalities and any securities
guaranteed thereby) if

9
<PAGE>
as a result more than 5% of total assets of the
Portfolio (based on fair market value at the time of
investment) would be invested in the securities of such
issuer; provided, however, that the Portfolio may
temporarily invest up to 25% of its total assets without
regard to this restriction as permitted by Rule 2a-7.

2. Purchase any securities which would cause more than 25%
of the total assets of the Portfolio based on fair
market value at the time of such purchase, to be
invested in the securities of one or more issuers
conducting their principal business activities in the
same industry, provided that this limitation does not
apply to investments in (a) domestic banks and (b)
obligations issued or guaranteed by the U.S. Government
or its agencies and instrumentalities.

3. Borrow money except for temporary or emergency purposes
and then only in an amount not exceeding 10% of the
value of the total assets of the Portfolio. This
borrowing provision is included solely to facilitate the
orderly sale of portfolio securities to accommodate
substantial redemption requests if they should occur and
is not for investment purposes. All borrowings will be
repaid before making additional investments for the
Portfolio and any interest paid on such borrowings will
reduce the income of the Portfolio.

For its management services, SEI Management is
entitled to a fee, which is calculated daily and paid
monthly, at an annual rate of .42% of the average daily net
assets of the Treasury Securities Portfolio. SEI Management
has contractually agreed to waive a portion of its fee in
order to limit total operating expenses on an annualized
basis to not more than .84% of the average daily net assets
of the Class D shares of the Portfolio on an annualized
basis. For the fiscal year ended June 30, 1997, the
Portfolio paid management fees, after fee waivers, of .37%
of the Portfolio's average daily net assets.

The Trust and DST Systems, Inc., 1004 Baltimore
Avenue, Kansas City, Missouri, 64105, have entered into a
separate transfer agent agreement with respect to the Class
D shares of the Portfolio. Under this agreement, DST acts
as the transfer agent and dividend disbursing agent (the
"Transfer Agent") for the Class D shares of the Trust.

10
<PAGE>
THE ADVISER
_______________________________________________________________________

Wellington Management Company, LLP (the "Adviser") 75 State
Street, Boston, Massachusetts 02109, serves as the
investment adviser to the Portfolio. The Adviser, under
an investment advisory agreement
with the Trust, invests the
assets of the Portfolio and
continuously reviews, supervises
and administers the Portfolio's
investment program, subject to
the supervision of, and policies
set by, the Trustees of the
Trust.

As of September 30, 1997,
the Adviser had investment
management authority with
respect to approximately $168.7
billion of assets, including the
assets of the Trust and SEI
Daily Income Trust, which is an
open-end money market investment
company administered by the
Manager. The Adviser is a
professional investment
counseling firm which provides investment services to
investment companies, employee benefit plans, endowments,
foundations, and other institutions and individuals. The
Adviser's predecessor organizations have provided
investment advisory services to investment companies since
1933, and to investment counseling clients since 1960. The
Adviser is a Massachusetts limited liability partnership,
of which the following persons are managing partners:
Robert W. Doran, Duncan M. McFarland and John R. Ryan.
...........................................................................
[>] INVESTMENT
ADVISER
A PORTFOLIO'S INVESTMENT ADVISER MANAGES THE INVESTMENT ACTIVITIES AND IS
RESPONSIBLE FOR THE PERFORMANCE OF THE PORTFOLIO. THE ADVISER CONDUCTS
INVESTMENT RESEARCH, EXECUTES INVESTMENT STRATEGIES BASED ON AN ASSESSMENT OF
ECONOMIC AND MARKET CONDITIONS, AND DETERMINES WHICH SECURITIES TO BUY, HOLD OR
SELL.

...........................................................................

The Adviser is entitled to a fee, which is calculated
daily and paid monthly, at an annual rate of .075% of the
combined average daily net assets of the Trust's Portfolios
up to $500 million, and .02% of such assets in excess of
$500 million. Such fees are allocated daily among the
Portfolios of the Trust on the basis of their relative net
assets. For the fiscal year ended June 30, 1997, the
Treasury Securities Portfolio paid advisory fees, after fee
waivers, of .04% of its relative net assets.

DISTRIBUTION

_______________________________________________________________________

SEI Investments Distribution Co. (the "Distributor"), a
wholly-owned subsidiary of SEI Investments Company, serves
as each Portfolio's distributor pursuant to a distribution
agreement (the "Distribution Agreement") with the Trust.
The Portfolio has adopted a distribution plan for its Class
D shares (the "Class D Plan") pursuant to Rule 12b-1 under
the Investment Company Act of 1940, as amended (the "1940
Act"). The Portfolio has adopted a shareholder servicing
plan for its Class A shares (the "Class A Plan").

The Class D Plan provides for payments to the
Distributor at an annual rate of .25% of the Portfolio's
average daily net assets attributable to Class D Shares.
This payment may be used to compensate financial
institutions that provide distribution-related services to
their customers. These payments are characterized as
"compensation," and are not directly tied to expenses
incurred by the Distributor; the payments the Distributor

11
<PAGE>
receives during any year may therefore be higher or lower
than its actual expenses. These payments compensate the
Distributor for its services in connection with
distribution assistance or the provision of shareholder
services, and some or all of it may be used to pay
financial institutions and intermediaries such as banks,
savings and loan associations, insurance companies, and
investment counselors, broker-dealers (including the
Distributor's affiliates and subsidiaries) for services or
reimbursement of expenses incurred in connection with
distribution assistance or the provision of shareholder
services. If the Distributor's expenses are less than its
fees under the Class D Plan, the Trust will still pay the
full fee and the Distributor will realize a profit, but the
Trust will not be obligated to pay in excess of the full
fee, even if the Distributor's actual expenses are higher.
Currently, the Distributor is taking this compensation
payment under the Class D Plan at a rate of .20% of the
Portfolio's average daily net assets, on an annualized
basis, attributable to Class D shares.

The Trust may execute brokerage or other agency
transactions through the Distributor for which the
Distributor may receive compensation.

PERFORMANCE
______________________________________________________________________

From time to time, the Portfolio may advertise "current
yield" and "effective compound yield." These figures will
fluctuate, as they are based on historical earnings and are
not intended to indicate future performance. The "current
yield" of the Portfolio refers to the income generated by
an investment over a seven-day period which is then
"annualized." That is, the amount of income generated by an
investment during that week is assumed to be generated each
week over a 52-week period and is shown as a percentage of
the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an
investment is assumed to be reinvested. The "effective
yield" will be slightly higher than the "current yield"
because of the compounding effect of this assumed
reinvestment.

The Portfolio may periodically compare its
performance to that of: (i) other mutual funds tracked by
mutual fund rating services (such as Lipper Analytical),
financial and business publications and periodicals; (ii)
broad groups of comparable mutual funds; (iii) unmanaged
indices which may assume investment of dividends but
generally do not reflect deductions for administrative and
management costs; or (iv) other investment alternatives.

12
<PAGE>
For the Portfolio, the performance of the Class A
shares will normally be higher than the performance of the
Class D shares of the Portfolio because of additional
distribution and transfer agent expenses charged to Class D
shares.
TAXES
______________________________________________________________________________

The following summary of federal income tax consequences is
based on current tax laws and regulations, which may be
changed by legislative, judicial or administrative action.
No attempt has been made to present a detailed explanation
of the federal, state, or local income tax treatment of the
Portfolio or its shareholders. In addition, state and local
tax consequences of an investment in the Portfolio may
differ from the federal income tax consequences described
below. Accordingly, Shareholders are urged to consult their
tax advisers regarding specific
questions as to federal, state
and local income taxes.
Additional information
concerning taxes is set forth in
the Statement of Additional
Information.
TAX STATUS OF THE
PORTFOLIO
The Portfolio is treated as a
separate entity for federal tax
purposes and is not combined
with the Trust's other
Portfolios. The Portfolio
intends to continue to qualify
for the special tax treatment afforded regulated investment
companies under subchapter M of the Internal Revenue Code
of 1986, as amended, so as to be relieved of federal income
tax on net investment company taxable income and net
capital gains (the excess of net long-term capital gain
over net short-term capital losses) distributed to
shareholders.
...........................................................................
[>] TAXES
YOU MUST PAY TAXES ON YOUR PORTFOLIO'S EARNINGS WHETHER YOU TAKE YOUR PAYMENTS
IN CASH OR ADDITIONAL SHARES.
...........................................................................
TAX STATUS OF
DISTRIBUTIONS

The Portfolio will distribute
substantially all of its net
investment income (including net
short-term capital gains) and
net capital gain to
shareholders. Dividends from net
investment company taxable
income are taxable to
shareholders as ordinary income,
whether received in cash or in
additional shares, to the extent
of the Portfolio's earning and
profits. Distributions of net
capital gains are taxable to
shareholders as gain from the
sale or exchange of a capital
asset held for more than one
year regardless of how long
shareholders have held their
shares and regardless of whether the distributions are
received in cash or in
...........................................................................
[>] DISTRIBUTIONS
THE PORTFOLIO DISTRIBUTES INCOME DIVIDENDS AND CAPITAL GAINS. INCOME DIVIDENDS
REPRESENT THE EARNINGS FROM THE PORTFOLIO'S INVESTMENTS; CAPITAL GAINS
DISTRIBUTIONS OCCUR WHEN INVESTMENTS IN THE PORTFOLIO ARE SOLD FOR MORE THAN THE

ORIGINAL PURCHASE PRICE.
...........................................................................

13
<PAGE>
additional shares. Dividends and distributions of capital
gains paid by the Portfolio do not qualify for the
dividends-received deduction for corporate shareholders.
The Portfolio will make annual reports to shareholders on
the federal income tax status of all distributions.

Dividends declared by the Portfolio in October,
November or December of any year and payable to
shareholders of record on a date in such a month will be
deemed to have been paid by the Portfolio and received by
the shareholders on December 31 of the year declared if
paid by the Portfolio at any time during the following
January.

The Portfolio intends to make sufficient
distributions prior to the end of each calendar year, to
avoid liability for the federal excise tax applicable to
regulated investment companies.

With respect to investments in U.S. Treasury STRIPS,
which are sold at original issue discount and thus do not
make periodic cash interest payments, the Portfolio will be
required to include as part of its current income the
imputed interest on such obligations even though the
Portfolio has not received any interest payments on such
obligations during that period. Because the Portfolio
distributes all of its net investment income to its
shareholders, the Portfolio may have to sell portfolio
securities to distribute such imputed income, which may
occur at a time when the Adviser would not have chosen to
sell such securities and, which may result in a taxable
gain or loss.

Investment income received by the Portfolio on direct
U.S. Government obligations is exempt from tax at the state
level when received directly by the Portfolio and may be
exempt, depending on the state, when received by a
shareholder as income dividends from the Portfolio provided
certain state-specific conditions are satisfied. Interest
received on repurchase agreements collateralized by U.S.
Government obligations normally is not exempt from state
taxation. The Portfolio will inform shareholders annually
of the percentage of income and distributions derived from
direct U.S. Government obligations. Shareholders should
consult their tax advisers to determine whether any portion
of the income dividends received from the Portfolio is
considered tax exempt in their particular states.

Each sale, exchange, or redemption of the Portfolio's
shares is a taxable transaction to the shareholder.

14
<PAGE>
ADDITIONAL
INFORMATION ABOUT
DOING BUSINESS WITH
US ____________________________________________________________________________

BUSINESS DAYS

You may buy, sell or exchange shares on days on which the
New York Stock Exchange is open for business ("Business
Days"). All purchase, exchange and redemption requests
received in "good order" will be effective as of the
Business Day received by the Transfer
Agent (or its authorized agent)
as long as the Transfer Agent
(or its authorized agent)
receives the order and, in the
case of a purchase request,
payment before 2:00 p.m.,
Eastern time. Otherwise the
purchase will be effective when
payment is received.
Broker-dealers may have separate
arrangements with the Trust
regarding the sale of Class D
shares.

If an exchange request is
for shares of a portfolio whose
net asset value is calculated as
of a time earlier than 2:00
p.m., Eastern time, the exchange
request will not be effective
until the next Business Day.
Anyone who wishes to make an
exchange must have received a
current prospectus of the portfolio into which the exchange
is being made before the exchange will be effected.
...........................................................................
[>] BUY, EXCHANGE AND SELL REQUESTS ARE IN "GOOD ORDER" WHEN:
- - THE ACCOUNT NUMBER AND PORTFOLIO NAME ARE SHOWN
- THE AMOUNT OF THE TRANSACTION IS SPECIFIED IN DOLLARS OR SHARES
- SIGNATURES OF ALL OWNERS APPEAR EXACTLY AS THEY ARE REGISTERED ON THE
ACCOUNT
- ANY REQUIRED SIGNATURE GUARANTEES (IF APPLICABLE) ARE INCLUDED
- OTHER SUPPORTING LEGAL DOCUMENTS (AS NECESSARY) ARE PRESENT
...........................................................................
MINIMUM INVESTMENTS
The minimum initial investment in the Portfolio's Class D
shares is $1,000; however, the minimum investment may be
waived at the Distributor's discretion. All subsequent
purchases must be at least $100 ($25 for payroll deductions
authorized pursuant to pre-approved payroll deduction
plans). The Trust reserves the right to reject a purchase
order when the Distributor determines that it is not in the
best interest of the Trust or its shareholders to accept
such order.
MAINTAINING A MINIMUM
ACCOUNT BALANCE
Due to the relatively high cost of handling small
investments, the Portfolio reserves the right to redeem, at
net asset value, the shares of any shareholder if, because
of redemptions of shares by or on behalf of the
shareholder, the account of such shareholder in the
Portfolio has a value of less than $1,000, the minimum
initial purchase amount. Accordingly, an investor
purchasing shares of the Portfolio in only the minimum
investment amount may be subject to such involuntary
redemption if he or she thereafter redeems any of these
shares. Before the Portfolio exercises its right to redeem
such shares and to send the proceeds to the shareholder,
the shareholder will be given notice that the value of the
shares in his or her account is less than the minimum
amount and will be allowed 60 days to make an additional
investment in that Portfolio in an amount that will
increase the value of the account to at least $1,000. See
"Purchase and Redemption of Shares" in

15
<PAGE>
the Statement of Additional Information for examples of
when the right of redemption may be suspended.

At various times, the Portfolio may receive a request
to redeem shares for which it has not yet received good
payment. In such circumstances, redemption proceeds will be
forwarded upon collection of payment for the shares;
collection of payment may take up to 15 days. The Portfolio
intends to pay cash for all shares redeemed, but under
abnormal conditions that make payment in cash unwise,
payment may be made wholly or partly in portfolio
securities with a market value equal to the redemption
price. In such cases, an investor may incur brokerage costs
in converting such securities to cash.

NET ASSET VALUE
An order to buy shares will be executed at a per share
price equal to the net asset value next determined after
the receipt of the purchase order by the Transfer Agent
(the "offering price"). No certificates representing shares
will be issued. An order to sell shares will be executed at
the net asset value per share next determined after receipt
and effectiveness of a request for redemption in good
order. Net asset value per share is determined daily as of
2:00 p.m., Eastern time on any Business Day. Payment to
shareholders for shares redeemed will be made within 7 days
after receipt by the Transfer Agent of the redemption
order.
HOW THE NET ASSET VALUE
IS DETERMINED
The net asset value per share of the Portfolio is
determined by dividing the total market value of its
investments and other assets, less any liabilities, by the
total number of outstanding shares of the Portfolio.
Although the methodology and procedures for determining net
asset value per share are identical for both classes of the
Portfolio, the net asset value per share of one class may
differ from that of another class because of the different
distribution fees and/or shareholder servicing fees charged
to each class and the incremental transfer agent fees
charged to Class D shares.
SIGNATURE GUARANTEES

The Transfer Agent may require that the signatures on the
written request be guaranteed. You should be able to obtain
a signature guarantee from a bank, broker, dealer, certain
credit unions, securities exchange or association, clearing
agency or savings association. A notary public cannot
guarantee signatures. The signature guarantee requirement
will be waived if all of the following conditions apply:
(1) the redemption is for not more than $5,000 worth of
shares, (2) the redemption check is payable to the
shareholder(s) of record, and (3) the redemption check is
mailed to the shareholder(s) at his or her address of
record. The Trust and the Transfer Agent reserve the right
to amend these requirements without notice.

16
<PAGE>
TELEPHONE/WIRE
INSTRUCTIONS

Redemption orders may be placed by telephone. Neither the
Trust nor the Transfer Agent will be responsible for any
loss, liability, cost or expense for acting upon wire
instructions or upon telephone instructions that it
reasonably believes to be genuine. The Trust and the
Transfer Agent will each employ reasonable procedures to
confirm that instructions communicated by telephone are
genuine, including requiring a form of personal
identification prior to acting upon instructions received
by telephone and recording telephone instructions. If
market conditions are extraordinarily active, or other
extraordinary circumstances exist, you experience
difficulties placing redemption orders by telephone and may
wish to consider placing orders by other means.

SYSTEMATIC WITHDRAWAL
PLAN ("SWP")
Please note that if withdrawals exceed income dividends,
your invested principal in the account will be depleted.
Thus, depending upon the frequency and amounts of the
withdrawal payments and/or any fluctuations in the net
asset value per share, your original investment could be
exhausted entirely. To participate in the SWP, you must
have your dividends automatically reinvested. You may
change or cancel the SWP at any time, upon written notice
to the Transfer Agent.
HOW TO CLOSE YOUR
ACCOUNT
An account may be closed by providing written notice to the
Transfer Agent. You may also close your account by
telephone if you have previously elected telephone options
on your account application.

GENERAL
INFORMATION
_______________________________________________________________________

THE TRUST

SEI Liquid Asset Trust was organized as a Massachusetts
business trust under a Declaration of Trust dated July 20,
1981. The Declaration of Trust permits the Trust to offer
separate Portfolios of shares and different classes of each
Portfolio. Shareholders may purchase shares in Portfolios
through two separate classes: Class A and Class D, which
provide for variation in distribution, shareholder
servicing and transfer agent costs, voting rights, and
dividends. This Prospectus offers the Class D shares of the
Trust's Treasury Securities Portfolio. In addition to the
Portfolio, the Trust consists of the following other
portfolios: Government Securities Portfolio, Institutional
Cash Portfolio, Prime Obligation Portfolio, and Money
Market Portfolio. Additional information pertaining to the
Trust may be obtained by writing to SEI Fund Management,
Oaks, Pennsylvania 19456, or by calling 1-800-437-6016. All
consideration received by the Trust for shares of any
Portfolio or class and all assets of such Portfolio or
class belong to that Portfolio or class and are subject to
liabilities related thereto.

17
<PAGE>
TRUSTEES OF THE TRUST
The management and affairs of the Trust are supervised by
the Trustees under the laws of the Commonwealth of
Massachusetts. The Trustees have approved contracts under
which, as described above, certain companies provide
essential management services to the Trust.
VOTING RIGHTS
Each share held entitles the shareholder of record to one
vote. The shareholders of each portfolio or class of the
Trust will vote separately on matters relating solely to
that Portfolio or class. As a Massachusetts business trust,
the Trust is not required to hold annual meetings of
shareholders, but approval will be sought for certain
changes in the operation of the Trust and for the election
of Trustees under certain circumstances. In addition, a
Trustee may be removed by the remaining Trustees or by
shareholders at a special meeting called upon written
request of shareholders owning at least 10% of the
outstanding shares of the Trust. In the event that such a
meeting is requested, the Trust will provide appropriate
assistance and information to the shareholders requesting
the meeting.
REPORTING
The Trust issues unaudited financial statements
semi-annually and audited financial statements annually.
The Trust furnishes proxy statements and other reports to
shareholders of record.
SHAREHOLDER INQUIRIES
Shareholder inquiries should be directed to DST Systems,
Inc., P.O. Box 419240, Kansas City, MO 64141-6240.
DIVIDENDS

Substantially all of the net investment income (exclusive
of capital gains) of the Portfolio is distributed in the
form of dividends that will be declared daily and paid
monthly on the first Business Day of each month. Dividends
will be paid on the next Business Day to shareholders who
redeem all of their shares of a Portfolio at any other time
during the month. Currently, capital gains (the excess of
net long-term capital gain over net short-term capital
loss) realized, if any, are distributed at least annually.

Shareholders in the Portfolio automatically receive
all income dividends and capital gain distributions in
additional shares at the net asset value next determined
following the record date, unless the shareholder has
elected to take such payment in cash. Shareholders may
change their election by providing written notice to the
Manager at least 15 days prior to the distribution.

Dividends and distributions of the Portfolio are paid
by the Portfolio on a per-share basis. The value of each
share will be reduced by the amount of any such payment. If
shares are purchased shortly before the record date for a
dividend or the distribution of capital gains, a
shareholder will pay the full price for the shares and
receive some portion of the price back as a taxable
dividend or distribution.
COUNSEL AND INDEPENDENT
ACCOUNTANTS
Morgan, Lewis & Bockius LLP serves as counsel to the Trust.
Price Waterhouse LLP serves as the independent accountants
to the Trust.
CUSTODIAN AND WIRE AGENT
CoreStates Bank, N.A., Broad and Chestnut Streets, P.O. Box
7618, Philadelphia, Pennsylvania 19101 (the "Custodian"),
serves as custodian of the Trust's assets and as

18
<PAGE>
wire agent of the Trust. The Custodian holds cash,
securities and other assets of the Trust as required by the
1940 Act.

DESCRIPTION OF
PERMITTED
INVESTMENTS
AND RISK FACTORS
_________________________________________________________________

The following is a description of certain of the permitted
investments for the Portfolio, and the associated risk
factors:
REPURCHASE AGREEMENTS

Repurchase agreements are agreements by which the Portfolio
obtains a security and simultaneously commits to return the
security to the seller at an agreed upon price on an agreed
upon date within a number of days from the date of
purchase. The Portfolio will have actual or constructive
possession of the securities held as collateral for the
repurchase agreement. The Portfolio bears a risk of loss in
the event the other party defaults on its obligations and
the Portfolio is delayed or prevented from exercising its
right to dispose of the collateral securities or if the
Portfolio realizes a loss on the sale of the collateral.
The Portfolio will enter into repurchase agreements only
with financial institutions deemed to present minimal risk
of bankruptcy during the term of the agreement based on
established guidelines. Repurchase agreements are
considered loans under the 1940 Act.

U.S. TREASURY
OBLIGATIONS
U.S. Treasury Obligations consist of bills, notes and bonds
issued by the U.S. Treasury, as well as separately traded
interest and principal component parts of such obligations,
known as Separately Traded Registered Interest and
Principal Securities ("STRIPS"), that are transferable
through the federal book-entry system.

STRIPS are sold as zero coupon securities which means
that they are sold at a substantial discount and redeemed
at face value at their maturity date without interim cash
payments of interest or principal. This discount is
accreted over the life of the security, and such accretion
will constitute the income earned on the security for both
accounting and tax purposes. Because of these features,
such securities may be subject to greater interest rate
volatility than interest paying permitted investments.

WHEN-ISSUED AND DELAYED
DELIVERY SECURITIES

When-issued or delayed delivery transactions involve the
purchase of an instrument with payment and delivery taking
place in the future. Delivery of and payment for these
securities may occur a month or more after the date of the
purchase commitment. The Portfolio will maintain with the
custodian a separate account, with liquid securities or
cash in an amount at least equal to these commitments. The
interest rate realized on these securities is fixed as of
the purchase date and no interest accrues to the Portfolio
before settlement.

19
<PAGE>
SEI LIQUID ASSET TRUST

Manager:

SEI Fund Management

Distributor:

SEI Investments Distribution Co.

Investment Adviser:

Wellington Management Company, LLP

This STATEMENT OF ADDITIONAL INFORMATION is not a Prospectus. It is intended
to provide additional information regarding the activities and operations of SEI
Liquid Asset Trust (the "Trust"), and should be read in conjunction with the
Trust's Class A and Class D Prospectuses, each of which is dated October 30,
1997. Prospectuses may be obtained upon request and without charge by writing
the Trust's distributor, SEI Investments Distribution Co., Oaks, Pennsylvania
19456, or by calling 1-800-342-5734.

TABLE OF CONTENTS

<TABLE>
<S> <C>
The Trust................................................................. S-2
Description of Permitted Investments...................................... S-2
The Manager............................................................... S-6
The Adviser............................................................... S-8
Distribution and Shareholder Servicing.................................... S-8
Trustees and Officers of the Trust........................................ S-9
Fundamental Investment Limitations........................................ S-11
Non-Fundamental Investment Limitations.................................... S-13
Performance............................................................... S-13
Determination of Net Asset Value.......................................... S-14
Purchase and Redemption of Shares......................................... S-15
Shareholder Services (Class D Shares)..................................... S-15
Taxes..................................................................... S-16
Portfolio Transactions.................................................... S-18
Description of Shares..................................................... S-18
Limitation of Trustees' Liability......................................... S-19
Shareholder Liability..................................................... S-19
5% Shareholders........................................................... S-19
Financial Information..................................................... S-20
</TABLE>

October 30, 1997

<PAGE>
THE TRUST

SEI Liquid Asset Trust (the "Trust") is a diversified, open-end management
investment company established as a Massachusetts business trust pursuant to a
Declaration of Trust dated July 20, 1981. The Declaration of Trust permits the
Trust to offer separate series ("portfolios") of units of beneficial interest
("shares") and separate classes of portfolios. Except for differences between
Class A and Class D shares pertaining to distribution and shareholder servicing
plans, voting rights, dividends and transfer agent expenses, each share of each
portfolio represents an equal proportionate interest in that portfolio with each
other share of that portfolio.

This Statement of Additional Information relates to the shares of the
following Portfolios: Treasury Securities, Government Securities, Prime
Obligation, Institutional Cash and Money Market Portfolios (each a "Portfolio"
and, together, the "Portfolios"), and any classes of the Portfolios.

DESCRIPTION OF PERMITTED INVESTMENTS

COMMERCIAL PAPER--The Prime Obligation and Money Market Portfolios may
invest in commercial paper. Commercial paper is the term used to designate
unsecured, short-term promissory notes issued by corporations and other
entities.

COMMERCIAL PAPER RATINGS--The following descriptions of commercial paper
ratings have been published by Standard & Poor's Corporation ("S&P"), Moody's
Investors Service, Inc. ("Moody's"), Fitch Investors Service, Inc. ("Fitch"),
Duff & Phelps, Inc. ("Duff"), Thomson BankWatch ("Thomson") and IBCA Limited and
IBCA, Inc. (together, "IBCA").

Commercial paper rated A by S&P is regarded by S&P as having the greatest
capacity for timely payment. Issues rated A are further refined by use of the
numbers 1+, 1 and 2 to indicate the relative degree of safety. Issues rated A-1+
are those with an "overwhelming degree" of credit protection. Those rated A-1,
the highest rating category, reflect a "very strong" degree of safety regarding
timely payment. Those rated A-2, the second highest rating category, reflect a
safety regarding timely payment, but not as high as A-1.

Moody's employs two designations, judged to be high grade commercial paper,
to indicate the relative repayment capacity of rated issuers as follows:

Prime-1 Superior Quality
Prime-2 Strong Quality

The rating Fitch-1 (Highest Grade) is the highest commercial paper rating
assigned by Fitch. Paper rated Fitch-1 is regarded as having the strongest
degree of assurance for timely payment. The rating Fitch-2 (Very Good Grade) is
the second highest commercial paper rating assigned by Fitch which reflects an
assurance of timely payment only slightly lower in degree than the strongest
issues.

The rating Duff-1 is the highest commercial paper rating assigned by Duff.
Paper rated Duff-1 is regarded as having very high certainty of timely payment
with excellent liquidity factors which are supported by ample asset protection.
Risk factors are minor. Paper rated Duff-2, the second highest rating category,
is regarded as having good certainty of timely payment, good access to capital
markets and sound liquidity factors and company fundamentals. Risk factors are
small.

The rating TBW-1 is the highest commercial paper rating assigned by Thomson.
Paper rated TBW-1 indicates a very high likelihood that principal and interest
will be paid on a timely basis. The rating TBW-2 is the second-highest rating
assigned category by Thomson. The relative degree of safety regarding timely
repayment of principal and interest is strong. However, the relative degree of
safety is not as high as for issues rated TBW-1.

The designation A1, the highest rating category established by IBCA,
indicates that the obligation is supported by a very strong capacity for timely
repayment. Those obligations rated A1+ are supported by

S-2
<PAGE>

the highest capacity for timely repayment. Obligations rated A2, the second
highest rating category, are supported by a strong capacity for timely
repayment, although such capacity may be susceptible to adverse changes in
business, economic or financial conditions.

FOREIGN SECURITIES--The Money Market Portfolio may invest in U.S. dollar
denominated obligations of foreign issuers, including foreign branches of U.S.
commercial banks, and of U.S. and London branches of foreign banks. These
instruments may subject the Portfolio to investment risks that differ in some
respects from those related to investments in obligations of U.S. domestic
issuers. Such risks include future adverse political and economic developments,
the possible imposition of withholding taxes on interest or other income,
possible seizure, nationalization, or expropriation of foreign deposits, the
possible establishment of exchange controls or taxation at the source, greater
fluctuations in value due to changes in exchange rates, or the adoption of other
foreign governmental restrictions which might adversely affect the payment of
principal and interest on such obligations. Such investments may also entail
higher custodial fees and sales commissions than domestic investments. Foreign
issuers of securities or obligations are often subject to accounting treatment
and engage in business practices different from those respecting domestic
issuers of similar securities or obligations. Foreign branches of U.S. banks and
foreign banks may be subject to less stringent reserve requirements than those
applicable to domestic branches of U.S. banks.

GNMA SECURITIES--The Prime Obligation, Money Market and Government
Securities Portfolios may invest in securities issued by the Government National
Mortgage Association ("GNMA"), a wholly-owned U.S. Government corporation which
guarantees the timely payment of principal and interest. However, any premiums
paid to purchase these instruments are not subject to GNMA guarantees. The
market value and interest yield of these instruments can vary due to market
interest rate fluctuations and early prepayments of underlying mortgages.

These securities represent ownership in a pool of Federally insured mortgage
loans. GNMA certificates consist of underlying mortgages with a maximum maturity
of 30 years. However, due to scheduled and unscheduled principal payments, GNMA
certificates have a shorter average maturity and, therefore, less principal
volatility than a comparable 30-year mortgage-backed bond. Since prepayment
rates vary widely, it is not possible to accurately predict the average maturity
of a particular GNMA pool. The scheduled monthly interest and principal payments
relating to mortgages in the pool will be "passed through" to investors. GNMA
securities differ from conventional bonds in that principal is paid back to the
certificate holders over the life of the loan rather than at maturity. As a
result, the Portfolios will receive monthly scheduled payments of principal and
interest. In addition, the Portfolios may receive unscheduled principal payments
representing prepayments on the underlying mortgages. Any prepayments will be
reinvested at the then-prevailing interest rate.

Although GNMA certificates may offer yields higher than those available from
other types of U.S. Government Securities, GNMA certificates may be less
effective than other types of securities as a means of "locking in" attractive
long-term rates because of the prepayment feature. Due to this prepayment
feature, GNMA certificates tend not to increase in value as much as most other
debt securities when interest rates decline.

MUNICIPAL SECURITIES--The Money Market and Prime Obligation Portfolios may
invest in Municipal Securities. The two principal classifications of Municipal
Securities are "general obligation" and "revenue" issues. General obligation
issues are issues involving the credit of an issuer possessing taxing power and
are payable from the issuer's general unrestricted revenues, although the
characteristics and method of enforcement of general obligation issues may vary
according to the law applicable to the particular issuer. Revenue issues are
payable only from the revenues derived from a particular facility or class of
facilities or other specific revenue source. A Portfolio may also invest in
"moral obligation" issues, which are normally issued by special purpose
authorities. Moral obligation issues are not backed by the full faith and credit
of the state but are generally backed by the agreement of the issuing authority
to request appropriations from the state legislative body. Municipal Securities
include debt obligations issued by

S-3
<PAGE>
governmental entities to obtain funds for various public purposes, such as the
construction of a wide range of public facilities, the refunding of outstanding
obligations, the payment of general operating expenses, and the extension of
loans to other public institutions and facilities. Certain private activity
bonds that are issued by or on behalf of public authorities to finance various
privately-owned or operated facilities are included within the term "Municipal
Securities." Private activity bonds and industrial development bonds are
generally revenue bonds, the credit and quality of which are directly related to
the credit of the private user of the facilities.

Municipal Securities may also include general obligation notes, tax
anticipation notes, bond anticipation notes, revenue anticipation notes, project
notes, certificates of indebtedness, demand notes, tax-exempt commercial paper,
construction loan notes and other forms of short-term, tax-exempt loans. Such
instruments are issued with a short-term maturity in anticipation of the receipt
of tax funds, the proceeds of bond placements or other revenues. Project notes
are issued by a state or local housing agency and are sold by the Department of
Housing and Urban Development. While the issuing agency has the primary
obligation with respect to its project notes, they are also secured by the full
faith and credit of the United States through agreements with the issuing
authority which provide that, if required, the federal government will lend the
issuer an amount equal to the principal of and interest on the project notes.

The quality of Municipal Securities, both within a particular classification
and between classifications, will vary, and the yields on Municipal Securities
depend upon a variety of factors, including general money market conditions, the
financial condition of the issuer (or other entity whose financial resources are
supporting the securities), general conditions of the municipal bond market, the
size of a particular offering, the maturity of the obligation and the rating(s)
of the issue. In this regard, it should be emphasized that the ratings of any
nationally recognized statistical rating organization ("NRSRO") are general and
are not absolute standards of quality. Municipal Securities with the same
maturity, interest rate and rating(s) may have different yields, while Municipal
Securities of the same maturity and interest rate with different rating(s) may
have the same yield.

An issuer's obligations under its Municipal Securities are subject to the
provisions of bankruptcy, insolvency, and other laws affecting the rights and
remedies of creditors, such as the Federal Bankruptcy Code, and laws, if any,
which may be enacted by Congress or state legislatures extending the time for
payment of principal or interest, or both, or imposing other constraints upon
the enforcement of such obligations or upon the ability of municipalities to
levy taxes. The power or ability of an issuer to meet its obligations for the
payment of interest on and principal of its Municipal Securities may be
materially adversely affected by litigation or other conditions.

MUNICIPAL AND CORPORATE BOND RATINGS--Bonds rated AAA have the highest
rating S&P assigns to a debt obligation. Such a rating indicates an extremely
strong capacity to pay principal and interest. Bonds rate AA also qualify as
high-quality debt obligations. Capacity to pay principal and interest is very
strong, and in the majority of instances, they differ from AAA issues only in
small degree.

Bonds which are rated Aaa by Moody's are judged to be 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 an exceptionally
sable, 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. Bonds rated Aa are judged by
Moody's to be of high quality by all standards. Together with bonds rated Aaa,
they comprise what are generally known as high-grade bonds. They are rated lower
than 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.

Bonds rated AAA are judged by Fitch to be strictly high grade, broadly
marketable, suitable for investment by trustees and fiduciary institutions
liable to but slight market fluctuation other than through changes in the money
rate. The prime feature of an AAA bond is a showing of earnings several times or

S-4
<PAGE>

many times interest requirements, with such stability of applicable earnings
that safety is beyond reasonable question whatever changes occur in conditions.
Bonds rated AA are judged by Fitch to be of safety virtually beyond question and
are readily salable, whose merits are not unlike those of the AAA class, but
whose margin of safety is less strikingly broad. The issue may be the obligation
of a small company, strongly secured but influenced as to rating by the lesser
financial power of the enterprise and more local type market.

Bonds rated Duff-1 are judged by Duff to be of the highest credit quality
with negligible risk factors; only slightly more than U.S. Treasury debt. Bonds
rated Duff-2, are judged by Duff to be of high credit quality with strong
protection factors. Risk is modest but may vary slightly from time to time
because of economic conditions.

Bonds which are rated AAA are judged by Thomson to be of the highest
category. The ability to repay principal and interest on a timely basis is very
high. Bonds rated AA are judged by Thomson to be of a superior ability to repay
principal and interest on a timely basis, with limited incremental risk compared
to issues rated in the highest category.

Obligations rated AAA by IBCA have the lowest expectation of investment
risk. Capacity for timely repayment of principal and interest is substantial,
such that adverse changes in business, economic or financial conditions are
unlikely to increase investment risk significantly. Obligations for which there
is a very low expectation of investment risk are rated AA by IBCA. Capacity for
timely repayment of principal and interest is substantial. Adverse changes in
business, economic or financial conditions may increase investment risk albeit
not very significantly.

MUNICIPAL NOTE RATINGS--Moody's highest rating for state and municipal and
other short-term notes is MIG-1 and VMIG-1. Short-term Municipal Securities
rated MIG-1 or VMIG-1 are of the best quality and such securities have strong
protection afforded by established cash flows, superior liquidity support and/or
demonstrated access to the market for refinancing. Short-term Municipal
Securities rated MIG-2 and VMIG-2 are of high quality and their margins of
protection are ample, although not so large as in the preceding group.

An S&P note rating reflects the liquidity concerns and market access risks
unique to notes. Notes due in three years or less will likely receive a note
rating. Notes maturing beyond three years will most likely receive a long-term
debt rating. The following criteria will be used in making that assessment.

- Amortization schedule (the larger the final maturity relative to other
maturities, the more likely it will be treated as a note).

- Source of payment (the more dependent the issue is on the market for its
refinancing, the more likely it will be treated as a note).

Note rate symbols are as follows:

SP-1. Very strong or strong capacity to pay principal and interest. Those
issues determined to possess overwhelming safety characteristics will be given a
plus (+) designation.

SP-2. Satisfactory capacity to pay principal and interest.

REPURCHASE AGREEMENTS--The Treasury Securities, Government Securities, Prime
Obligation, and Money Market Portfolios may enter into repurchase agreements,
which are agreements under which securities are acquired from a securities
dealer or bank subject to resale on an agreed upon date and at an agreed upon
price which includes principal and interest. The Portfolio involved bears a risk
of loss in the event that the other party to a repurchase agreement defaults on
its obligations and the Portfolio is delayed or prevented from exercising its
rights to dispose of the securities held as collateral. Wellington Management
Company, LLP (the "Adviser") enters into repurchase agreements only with
financial institutions which it deems to present minimal risk of bankruptcy
during the term of the agreement based on

S-5
<PAGE>
guidelines established by and periodically reviewed by the Board of Trustees.
These guidelines currently permit the Portfolios to enter into repurchase
agreements only with approved banks and primary securities dealers, as
recognized by the Federal Reserve Bank of New York, which have minimum net
capital of $100 million, or with a member bank of the Federal Reserve System.
Repurchase agreements are considered to be loans collateralized by the
underlying security. Repurchase agreements entered into by the Portfolios will
provide that the underlying security at all times shall have a value at least
equal to 102% of the price stated in the agreement. This underlying security
will be marked to market daily. The Adviser monitors compliance with this
requirement. Under all repurchase agreements entered into by the Portfolios, the
Portfolios will take actual or constructive possession of the underlying
collateral. However, if the seller defaults, the Portfolios could realize a loss
on the sale of the underlying security to the extent the proceeds of the sale
are less than the resale price. In addition, even though the Bankruptcy Code
provides protection for most repurchase agreements, if the seller should be
involved in bankruptcy or insolvency proceedings, the Portfolios may incur delay
and costs in selling the security and may suffer a loss of principal and
interest if the Portfolios are treated as an unsecured creditor.

U.S. GOVERNMENT AGENCY OBLIGATIONS--The Government Securities, Prime
Obligation, and Money Market Portfolios may invest in obligations of agencies of
the United States Government, which consist of obligations issued by, among
others, the Export Import Bank of the United States, Farmers Home
Administration, Federal Farm Credit Bank, Federal Housing Administration,
Government National Mortgage Association, Maritime Administration, Small
Business Administration, and The Tennessee Valley Authority. The Government
Securities, Prime Obligation, and Money Market Portfolios may purchase
securities guaranteed by the Government National Mortgage Association, which
represent participation in Veterans Administration and Federal Housing
Administration backed mortgage pools. Obligations of instrumentalities of the
United States Government include securities issued by, among others, Federal
Home Loan Banks, Federal Home Loan Mortgage Corporation, Federal Intermediate
Credit Banks, Federal Land Banks, Fannie Mae and the United States Postal
Service. Some of these securities are supported by the full faith and credit of
the United States Treasury (E.G., GNMA Securities), others are supported by the
right of the issuer to borrow from the Treasury, and still others are supported
only by the credit of the instrumentality (E.G., Fannie Mae Securities).
Guarantees of principal by agencies or instrumentalities of the U.S. Government
may be a guarantee of payment at the maturity of the obligation, so that in the
event of a default prior to maturity, there might not be a market, and thus no
means of realizing the value of the obligation prior to maturity. The Portfolios
do not intend to purchase securities issued by the World Bank, the
Inter-American Development Bank or the Asian Development Bank.

VARIABLE OR FLOATING RATE INSTRUMENTS--Each Portfolio may invest in variable
or floating rate instruments, which may involve a demand feature and may include
variable amount master demand notes which may or may not be backed by bank
letters of credit. Variable or floating rate instruments bear interest at a rate
which varies with changes in market rates. The holder of an instrument with a
demand feature may tender the instrument back to the issuer at par prior to
maturity. A variable amount master demand note is issued pursuant to a written
agreement between the issuer and the holder, its amount may be increased by the
holder or decreased by the holder or issuer, it is payable on demand, and the
rate of interest varies based upon an agreed formula. The quality of the
underlying credit must, in the opinion of the Adviser, be equivalent to the
quality ratings applicable to permitted investments for each Portfolio. The
Adviser will monitor on an ongoing basis the earning power, cash flow, and
liquidity ratios of the issuers of such instruments and will similarly monitor
the ability of an issuer of a demand instrument to pay principal and interest on
demand.

THE MANAGER

The Management Agreement, provides that SEI Fund Management (the "Manager")
shall not be liable for any error of judgment or mistake of law or for any loss
suffered by the Trust in connection with the matters to which the Management
Agreement relates, except a loss resulting from willful misfeasance,

S-6
<PAGE>
bad faith or gross negligence on the part of the Manager in the performance of
its duties or from reckless disregard of its duties and obligations thereunder.

The Management Agreement, unless terminated sooner as provided therein,
shall remain in effect for two years after the date of the Agreement and shall
continue in effect for successive periods of one year if such continuance is
specifically approved at least annually (i) by the Trustees of the Trust and
(ii) by the vote of a majority of the Trustees of the Trust, who are not parties
to the Management Agreement or interested persons (as that term is defined in
the Investment Company Act of 1940, as amended (the "1940 Act")) of any such
party, cast in person at a Board of Trustees meeting called for the purpose of
voting on such approval. The Agreement may be terminated at any time and without
penalty by the Trustees of the Trust or by the Manager on not less than 30 days'
nor more than 60 days' written notice to the other party thereto. Any notice
under the Management Agreement shall be given in writing, addressed and
delivered, or mailed postpaid, to the other party at the designated mailing
address of such party.

The Manager, a Delaware business trust, has its principal business offices
at Oaks, Pennsylvania 19456. SEI Investments Management Corporation ("SIMC"), a
wholly-owned subsidiary of SEI Investments Company ("SEI Investments"), is the
owner of all beneficial interest in the Manager. SEI Investments and its
subsidiaries and affiliates, including the Manager, are leading providers of
funds evaluation services, trust accounting systems, and brokerage and
information services to financial institutions, institutional investors, and
money managers. The Manager and its affiliates also serve as administrator or
sub-administrator to the following other mutual funds: The Achievement Funds
Trust, The Advisors' Inner Circle Fund, The Arbor Fund, ARK Funds, Bishop Street
Funds, Boston 1784 Funds-Registered Trademark-, CoreFunds, Inc., CrestFunds,
Inc., CUFUND, The Expedition Funds, FMB Funds, Inc., First American Funds, Inc.,
First American Investment Funds, Inc., First American Strategy Funds, Inc.,
HighMark Funds, Marquis Funds-Registered Trademark-, Monitor Funds, Morgan
Grenfell Investment Trust, The PBHG Funds, Inc., PBHG Insurance Series Fund,
Inc., The Pillar Funds, Profit Funds Investment Trust, Rembrandt
Funds-Registered Trademark-, Santa Barbara Group of Mutual Funds, Inc., SEI
Asset Allocation Trust, SEI Daily Income Trust, SEI Index Funds, SEI
Institutional Investments Trust, SEI Institutional Managed Trust, SEI
International Trust, SEI Tax Exempt Trust, STI Classic Funds, STI Classic
Variable Trust, and TIP Funds.

The Manager has agreed contractually to waive its fee in order to limit
operating expenses of the Portfolios to not more than .44% of average net assets
of the Class A shares and .84% of average net assets of the Class D shares. As
to the Institutional Cash Portfolio only, this waiver is voluntary and may be
terminated at any time. Shareholders will be notified in advance if and when the
waiver is terminated. The Manager will not be required to bear expenses of any
Portfolio to an extent which would result in the Portfolio's inability to
qualify as a regulated investment company under provisions of the Internal
Revenue Code of 1986, as amended (the "Code"). The term "expenses" is defined in
such laws or regulations, and generally excludes brokerage commissions,
distribution expenses, taxes, interest, litigation and extraordinary expenses.

For the fiscal years ended June 30, 1995, 1996 and 1997, the Portfolios paid
fees to the Manager as follows:

<TABLE>
<CAPTION>
MANAGEMENT FEES PAID MANAGEMENT FEES WAIVED
--------------------------------------------- ---------------------------------------------
1995 1996 1997 1995 1996 1997
------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Treasury Securities Portfolio....... $ 4,160,873 $ 3,979,872 $ 2,666,177 $ 1,226,700 $ 981,184 $ 383,785
Prime Obligation Portfolio.......... $ 3,352,356 $ 2,773,884 $ 3,030,793 $ 884,036 $ 786,431 $ 418,795
Government Securities Portfolio..... $ 794,731 $ 621,433 $ 676,893 $ 221,071 $ 198,391 $ 42,733
Institutional Cash Portfolio........ $ 7,878 $ 9,292 $ 7,595 $ -- $ -- $ --
Money Market Portfolio * * * * * *
</TABLE>

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

* Not in operation during such period.

S-7
<PAGE>
THE ADVISER

The Trust and Wellington Management Company, LLP ("the Adviser") have
entered into an investment advisory agreement (the "Advisory Agreement") dated
October 30, 1985. The Advisory Agreement provides that the Adviser shall not be
protected against any liability to the Trust or its shareholders by reason of
willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard of its obligations or
duties thereunder.

The continuance of the Advisory Agreement after the first two (2) years of
the Agreement must be specifically approved at least annually (i) by the vote of
a majority of the outstanding shares of that Portfolio or by the Trustees, and
(ii) by the vote of a majority of the Trustees who are not parties to the
Advisory Agreement or "interested persons" of any party thereto, cast in person
at a meeting called for the purpose of voting on such approval. The Advisory
Agreement will terminate automatically in the event of its assignment, and is
terminable at any time without penalty by the Trustees of the Trust or, with
respect to a Portfolio, by a majority of the outstanding shares of that
Portfolio, on not less than 30 days' nor more than 60 days' written notice to
the Adviser, or by the Adviser on 90 days' written notice to the Trust.

The Adviser is entitled to a fee for its investment advisory services, which
is calculated daily and paid monthly, at the following annual rates: .075% of
the Trust's daily net assets up to $500 million, and .02% of the Trust's daily
net assets in excess of $500 million. The fee is allocated among the Portfolios
based upon their relative net assets.

For the fiscal years ended June 30, 1995, 1996, and 1997 the Portfolios paid
the Adviser advisory fees as follows:

<TABLE>
<CAPTION>
ADVISORY FEES PAID
---------------------------------------------
1995 1996 1997
------------- ------------- -------------
<S> <C> <C> <C>
Treasury Securities Portfolio..................... $ 395,983 $ 381,950 $ 261,109
Prime Obligation Portfolio........................ $ 311,042 $ 274,922 $ 296,290
Government Securities Portfolio................... $ 74,686 $ 63,381 $ 61,539
Institutional Cash Portfolio...................... $ -- $ -- $ --
Money Market Portfolio............................ * * *
</TABLE>

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

* Not in operation during such period.

DISTRIBUTION AND SHAREHOLDER SERVICING

The Trust has adopted a Distribution Agreement for the Portfolios dated
November 29, 1982. The Trust has also adopted a Class D Distribution Plan (the
"Class D Plan") for the Treasury Securities Portfolio in accordance with Rule
12b-1 under the 1940 Act, which regulates the circumstances under which an
investment company may directly or indirectly bear expenses relating to the
distribution of its shares. In this regard, the Board of Trustees has determined
that the Class D Plan and the Distribution Agreement are in the best interests
of the Shareholders. Continuance of the Class D Plan must be approved annually
by a majority of the Trustees of the Trust, and by a majority of the Trustees
who are not "interested persons" of the Trust as that term is defined in the
1940 Act, and who have no direct or indirect financial interest in the operation
of a Distribution Plan or in any agreements related thereto ("Qualified
Trustees"). The Class D Plan requires that quarterly written reports of amounts
spent under the Plan and the purposes of such expenditures be furnished to and
reviewed by the Trustees. The Class D Plan may not be amended to increase
materially the amount which may be spent thereunder without approval by a
majority of the outstanding shares of the Portfolio. All material amendments of
the Class D Plan will require approval by a majority of the Trustees of the
Trust and of the Qualified Trustees.

S-8
<PAGE>
The Class D Plan provides that the Trust will pay the Distributor a fee on
the Class D shares of the Portfolio. The Distributor may use this fee for: (i)
compensation for its services in connection with distribution assistance or
provision of shareholder services or (ii) payments to financial institutions and
intermediaries such as banks, savings and loan associations, insurance companies
and investment counselors, broker-dealers and the Distributor's affiliates and
subsidiaries as compensation for services or reimbursement of expenses incurred
in connection with distribution assistance or provision of shareholder services.

The Portfolios have adopted a shareholder servicing plan for its Class A
shares (the "Class A Plan"). Under this Plan, the Distributor may perform, or
may compensate other service providers for performing, the following shareholder
and administrative services: maintaining client accounts; arranging for bank
wires; responding to client inquiries concerning services provided on
investments; assisting clients in changing dividend options, account
designations and addresses; sub-accounting; providing information on share
positions to clients; forwarding shareholder communications to clients;
processing purchase, exchange and redemption orders; and processing dividend
payments. Under the Service Plan, the Distributor may retain as a profit any
difference between the fee it receives and the amount it pays to third parties.

For the fiscal year ended June 30, 1997, the Portfolios incurred the
following distribution expenses:

<TABLE>
<CAPTION>
PROSPECTUS
AMOUNT PAID TO PRINTING &
3RD PARTIES BY SFS MAILING
FOR DISTRIBUTOR COSTS (NEW
TOTAL BASIS RELATED SERVICES ADVERTISING SHAREHOLDERS
PORTFOLIO/CLASS ($AMOUNT) POINTS ($AMOUNT) ($AMOUNT) ONLY) ($AMOUNT)
- --------------------------------- ------------- ----------- ------------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>

CLASS D
Treasury Securities............ $ 464 .20% $ 464 $ -- $ --

COSTS ASSOCIATED
WITH REGISTRATION
PORTFOLIO/CLASS FEES ($AMOUNT) OTHER
- --------------------------------- ----------------- -----------
<S> <C> <C>
CLASS D
Treasury Securities............ $ -- $ --
</TABLE>

TRUSTEES AND OFFICERS OF THE TRUST

The Trustees and Executive Officers of the Trust, their respective dates of
birth, and their principal occupations for the last five years are set forth
below. Each may have held other positions with the named companies during that
period. Unless otherwise noted, the business address of each Trustee and
executive officer is SEI Investments Company, Oaks, Pennsylvania 19456. Certain
officers of the Trust also serve as officers of some of the following: The
Achievement Funds Trust, The Advisors' Inner Circle Fund, The Arbor Fund, ARK
Funds, Bishop Street Funds, CoreFunds, Inc., CrestFunds, Inc., CUFUND, The
Expedition Funds, FMB Funds, Inc., First American Funds, Inc., First American
Investment Funds, Inc., First American Strategy Funds, Inc., HighMark Funds,
Marquis Funds-Registered Trademark-, Monitor Funds, Morgan Grenfell Investment
Trust, The PBHG Funds, Inc., The Pillar Funds, Profit Funds Investment Trust,
Rembrandt Funds-Registered Trademark-, Santa Barbara Group of Mutual Funds,
Inc., Boston 1784 Funds, SEI Asset Allocation Trust, SEI Daily Income Trust, SEI
Index Funds, SEI Institutional Investments Trust, SEI Institutional Managed
Trust, SEI International Trust, SEI Tax Exempt Trust, STI Classic Funds, STI
Classic Variable Trust and TIP Funds, open-end management investment companies
which are managed by SEI Fund Management or its affiliates and, except for and
with the exception of Profit Funds Investment Trust, Rembrandt
Funds-Registered Trademark-, and Santa Barbara Group of Mutual Funds, Inc., are
distributed by SEI Investments Distribution Co. (the "Distributor").

ROBERT A. NESHER (DOB 08/17/46)--Chairman of the Board of
Trustees*--Currently performs various services on behalf of SEI for which Mr.
Nesher is compensated. Executive Vice President of SEI, 1986-1994. Director and
Executive Vice President of the Manager and the Distributor, 1981-1994. Trustee
of the Arbor Fund, Marquis Funds-Registered Trademark-, The Advisors' Inner
Circle Fund, SEI Asset Allocation Trust, SEI Daily Income Trust, SEI Tax Exempt
Trust, SEI Index Funds, SEI Institutional Managed Trust, SEI

S-9
<PAGE>

Institutional Investments Trust, SEI International Trust, Insurance Investment
Products Trust, Boston 1784 Funds-Registered Trademark-, Pillar Funds, and
Rembrandt Funds-Registered Trademark-.

WILLIAM M. DORAN (DOB 05/26/40)--Trustee*--2000 One Logan Square,
Philadelphia, PA 19103. Partner, Morgan, Lewis & Bockius LLP (law firm), counsel
to the Trust, Manager and Distributor, Director and Secretary of SEI and
Secretary of the Manager and Distributor. Trustee of the Arbor Fund, Marquis
Funds-Registered Trademark-, The Advisors' Inner Circle Fund, SEI Asset
Allocation Trust, SEI Daily Income Trust, SEI Tax Exempt Trust, SEI Index Funds,
SEI Institutional Managed Trust, SEI Institutional Investments Trust, and SEI
International Trust.

F. WENDELL GOOCH (DOB 12/03/32)--Trustee**--P.O. Box 190, Paoli, IN 47454.
President, Orange County Publishing Co., Inc. from October 1981 to January 1,
1997. Publisher of the Paoli News and the Paoli Republican and Editor of the
Paoli Republican since January 1981. President, H & W Distribution, Inc. since
July 1984. Executive Vice President, Trust Department, Harris Trust and Savings
Bank and Chairman of the Board of Directors of The Harris Trust Company of
Arizona before January 1981. Trustee of STI Classic Funds, SEI Asset Allocation
Trust, SEI Daily Income Trust, SEI Tax Exempt Trust, SEI Index Funds, SEI
Institutional Managed Trust, SEI Institutional Investments Trust and SEI
International Trust.

FRANK E. MORRIS (DOB 12/30/23)--Trustee**--105 Walpole Street, Dover, MA
02030. Retired since 1990. Peter Drucker Professor of Management, Boston
College, 1989-1990. President, Federal Reserve Bank of Boston, 1968-1988.
Trustee of The Arbor Fund, Marquis Funds-Registered Trademark-, The Advisors'
Inner Circle Fund, SEI Asset Allocation Trust, SEI Daily Income Trust, SEI Tax
Exempt Trust, SEI Index Funds, SEI Institutional Managed Trust, SEI
Institutional Investments Trust, and SEI International Trust.

JAMES M. STOREY (DOB 04/12/31)--Trustee**--89A Mt. Vernon Street, Boston, MA
02108.-- Partner, Dechert Price & Rhoads, from September 1987 - December 1993.
Trustee of the Arbor Fund, Marquis Funds-Registered Trademark-, The Advisors'
Inner Circle Fund, SEI Asset Allocation Trust, SEI Daily Income Trust, SEI Tax
Exempt Trust, SEI Index Funds, SEI Institutional Managed Trust, SEI
Institutional Investments Trust, and SEI International Trust.

GEORGE J. SULLIVAN, JR. (DOB 11/13/42)--Trustee**--48 Catherine Drive,
Peabody, MA 01960. General Partner, Teton Partners, L.P., since 1991; Chief
Financial Officer, Noble Partners, L.P., since 1991; Treasurer and Clerk, Peak
Asset Management, Inc., since 1991; Trustee, Navigator Securities Lending Trust,
since 1995. Trustee of SEI Asset Allocation Trust, SEI Daily Income Trust, SEI
Tax Exempt Trust, SEI Index Funds, SEI Institutional Managed Trust, SEI
Institutional Investments Trust, and SEI International Trust.

DAVID G. LEE (DOB 04/16/52)--President and Chief Executive Officer--Senior
Vice President of the Manager and Distributor since 1993. Vice President of the
Manager and Distributor, 1991-1993. President, GW Sierra Trust Funds before
1991.

SANDRA K. ORLOW (DOB 10/18/53)--Vice President and Assistant Secretary--Vice
President and Assistant Secretary of the Manager and Distributor since 1988.

KEVIN P. ROBINS (DOB 04/15/61)--Vice President and Assistant
Secretary--Senior Vice President, General Counsel of SEI, the Manager and
Distributor since 1994. Vice President and Assistant Secretary of SEI, the
Manager and Distributor, 1992-1994. Associate, Morgan, Lewis & Bockius LLP (law
firm), 1988-1992.

RICHARD W. GRANT (DOB 10/25/45)--Secretary--2000 One Logan Square,
Philadelphia, PA 19103, Partner, Morgan, Lewis & Bockius LLP (law firm), counsel
to the Trust, Manager and Distributor.

KATHRYN L. STANTON (DOB 11/19/58)--Vice President and Assistant
Secretary--Deputy General Counsel, Vice President and Assistant Secretary of
SEI, the Manager and Distributor since 1994, General

S-10
<PAGE>

Counsel, Investment Systems & Services since 1997. Associate, Morgan, Lewis &
Bockius LLP (law firm), 1989-1994.

MARK E. NAGLE (DOB 10/20/59)--Controller and Chief Financial Officer--Vice
President of Fund Accounting and Administration for SEI Fund Resources and the
Manager since 1996. Vice President of Fund Accounting, BISYS Fund Services
(1995-1996). Fidelity Investments (1981-1995).

TODD CIPPERMAN (DOB 02/14/66)--Vice President and Assistant Secretary--Vice
President and Assistant Secretary of SEI, the Manager and the Distributor since
1995. Associate, Dewey Ballantine (law firm) (1994-1995). Associate, Winston &
Strawn (law firm) (1991-1994).

BARBARA A. NUGENT (DOB 06/18/56)--Vice President and Assistant
Secretary--Vice President and Assistant Secretary of SEI, the Manager and
Distributor since 1996. Associate, Drinker, Biddle & Reath (law firm). Assistant
Vice President/Administration, Delaware Service Company, Inc. (1992-1993),
Assistant Vice President - Operations, Delaware Service Company, Inc.
(1988-1992).

MARC H. CAHN (DOB 06/19/57)--Vice President and Assistant Secretary--Vice
President and Assistant Secretary of SEI, the Manager and Distributor since
1996. Associate General Counsel, Barclays Bank PLC (1995-1996). ERISA counsel,
First Fidelity Bancorporation (1994-1995), Associate, Morgan, Lewis & Bockius
LLP (1989-1994).

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

* Messrs. Nesher and Doran are Trustees who may be deemed to be "interested
persons" of the Trust as the term is defined in the 1940 Act.

** Messrs. Gooch, Storey, Sullivan and Morris serve as members of the Audit
Committee of the Trust.

The Trustees and officers of the Trust own less than 1% of the outstanding
shares of the Trust. The Trust pays the fees for unaffiliated Trustees.
Compensation of officers and affiliated Trustees of the Trust is paid by the
Manager.

The following table sets forth information about the compensation paid to
the Trustees for the fiscal year ended June 30, 1997:

<TABLE>
<CAPTION>
TOTAL
PENSION OR COMPENSATION FROM
AGGREGATE RETIREMENT ESTIMATED REGISTRANT AND
COMPENSATION BENEFITS ACCRUED ANNUAL FUND COMPLEX PAID TO
FROM REGISTRANT AS PART OF BENEFITS UPON DIRECTORS FOR FYE
NAME OF PERSON AND POSITION FOR FYE 6/30/97 FUND EXPENSES RETIREMENT 6/30/97
- ----------------------------------------- ----------------- ------------------- ----------------- --------------------
<S> <C> <C> <C> <C>
Robert A. Nesher, Trustee................ $ -- N/A N/A $ --
William M. Doran, Trustee................ $ -- N/A N/A $ --
F. Wendell Gooch, Trustee................ $ 5,224 N/A N/A $94,500 on services
on 8 boards
Frank E. Morris, Trustee................. $ 5,224 N/A N/A $94,500 on service
on 8 boards
James M. Storey, Trustee................. $ 5,224 N/A N/A $94,500 on service
on 8 boards
George J. Sullivan, Trustee.............. $ 5,224 N/A N/A $94,500 on services
on 8 boards
</TABLE>

Mr. Edward W. Binshadler is a Trustee Emeritus of the Trust. Mr. Binshadler
serves as a consultant to the Audit Committee and receives as compensation,
$5,000 per Audit Committee meeting attended.

FUNDAMENTAL INVESTMENT LIMITATIONS

The following investment limitations are fundamental policies of each
Portfolio which cannot be changed with respect to a Portfolio without the
consent of the holders of a majority of that Portfolio's outstanding shares. The
term "majority of outstanding shares" means the vote of (i) 67% or more of a
Portfolio's shares present at a meeting, if more than 50% of the outstanding
shares of a Portfolio are

S-11
<PAGE>
present or represented by proxy, or (ii) more than 50% of a Portfolio's
outstanding shares, whichever is less.

No Portfolio may:

1. Borrow money except for temporary or emergency purposes and then only in an
amount not exceeding 10% of the value of the total assets of that Portfolio.
This borrowing provision is included solely to facilitate the orderly sale
of portfolio securities to accommodate substantial redemption requests if
they should occur and is not for investment purposes. All borrowings by a
Portfolio will be repaid before making additional investments for that
Portfolio and any interest on such borrowings will reduce the income of that
Portfolio.

2. Make loans, except that any Portfolio may purchase or hold debt instruments
in accordance with its investment objective and policies and may enter into
repurchase agreements, provided that repurchase agreements maturing in more
than seven days, restricted securities and other illiquid securities are not
to exceed, in the aggregate, 10% of the Portfolio's total assets.

3. Pledge, mortgage or hypothecate assets except to secure temporary
borrowings, as described in the Prospectus, in aggregate amounts not to
exceed 10% of the net assets of such Portfolio taken at fair market value at
the time such loan is incurred.

4. Invest in companies for the purpose of exercising control.

5. Acquire more than 10% of the voting securities of any one issuer.

6. Purchase or sell real estate, real estate limited partnership interests,
commodities or commodities contracts including futures contracts. However,
subject to its permitted investments, any Portfolio may purchase obligations
issued by companies which invest in real estate, real estate limited
partnerships, commodities or commodities contracts.

7. Make short sales of securities, maintain a short position or purchase
securities on margin, except that a Portfolio may obtain short-term credits
as necessary for the clearance of security transactions.

8. Act as an underwriter of securities of other issuers except as it may be
deemed an underwriter in selling a portfolio security.

9. Purchase securities of other investment companies except as permitted by the
1940 Act and the rules and regulations thereunder and, in any event, may not
purchase securities of other open-end investment companies. Under these
rules and regulations, the Portfolios are prohibited from acquiring the
securities of other investment companies if, as a result of such
acquisition, a Portfolio owns more than 3% of the total voting stock of an
investment company; securities issued by any one investment company
represent more than 5% of the total Portfolio assets; or securities (other
than treasury stock) issued by all investment companies represent more than
10% of the total assets of a Portfolio. These investment companies typically
incur fees that are separate from those fees incurred directly by a
Portfolio. A Portfolio's purchase of such investment companies results in
the layering of expenses such that shareholders would indirectly bear a
proportionate share of such investment companies' expenses, including
advisory fees.

10. Issue senior securities (as defined in the Investment Company Act of 1940)
except in connection with permitted borrowings as described in the
Prospectus and this Statement of Additional Information or as permitted by
rule, regulation or order of the Securities and Exchange Commission.

11. Purchase or retain securities of an issuer if, to the knowledge of the
Trust, an officer, trustee, partner or director of the Trust or any
investment adviser of the Trust owns beneficially more than of 1% of the
shares or securities of such issuer and all such officers, trustees,
partners and directors owning more than of 1% of such shares or securities
together own more than 5% of such shares or securities.

S-12
<PAGE>
12. Purchase securities of any company which has (with predecessors) a record of
less than three years' continuing operations, except (i) obligations issued
or guaranteed by the U.S. Government, its agencies or instrumentalities, or
(ii) municipal securities which are rated by at least two nationally
recognized municipal bond rating services, if, as a result, more than 5% of
the total assets (taken at fair market value) of the Portfolio would be
invested in such securities.

13. Purchase warrants, puts, calls, straddles, spreads or combinations thereof.

14. Invest in interests in oil, gas or other mineral exploration or development
programs.

15. Purchase restricted securities (securities which must be registered under
the Securities Act of 1933 before they may be offered or sold to the public)
or other illiquid securities except as described in the Prospectus and this
Statement of Additional Information.

Except with respect to the limitation on investing in illiquid securities,
the foregoing percentages will apply at the time of the purchase of a security
and shall not be considered violated unless an excess or deficiency occurs or
exists immediately after and as a result of a purchase of such security.

NON-FUNDAMENTAL INVESTMENT LIMITATIONS

The following investment limitation is a non-fundamental policy of the Trust
and may be changed without shareholder approval.

1. The Government Securities and Prime Obligation Portfolios must maintain an
average dollar-weighted portfolio maturity of 90 days or less.

PERFORMANCE

From time to time, each Portfolio may advertise its yield. These figures
will be based on historical earnings and are not intended to indicate future
performance.

The current yield of each Portfolio is calculated daily based upon the seven
days ending on the date of calculation ("base period"). The yield is computed by
determining the net change (exclusive of capital changes) in the value of a
hypothetical pre-existing shareholder account having a balance of one share at
the beginning of the period, subtracting a hypothetical charge reflecting
deductions from shareholder accounts and dividing such net change by the value
of the account at the beginning of the same period to obtain the base period
return and multiplying the result by (365/7). Realized and unrealized gains and
losses are not included in the calculation of the yield.

The Portfolios compute their effective compound yield by determining the net
changes, exclusive of capital changes, in the value of a hypothetical
pre-existing account having a balance of one share at the beginning of the
period, subtracting a hypothetical charge reflecting deductions from shareholder
accounts, and dividing the difference by the value of the account at the
beginning of the base period to obtain the base period return, and then
compounding the base period return by adding 1, raising the sum to a power equal
to 365 divided by 7, and subtracting 1 from the result, according to the
following formula: Effective Yield = [(Base Period Return + 1)(365/7) - 1]. The
current and the effective yields reflect the reinvestment of net income earned
daily on portfolio assets.

Actual yields will depend on such variables as asset quality, average asset
maturity, the type of instruments a Portfolio invests in, changes in interest
rates on money market instruments, changes in the expenses of the Portfolios and
other factors.

Yields are one basis upon which investors may compare the Portfolios with
other money market funds; however, yields of other money market mutual funds and
other investment vehicles may not be comparable because of the factors set forth
above and differences in the methods used in valuing portfolio instruments.

S-13
<PAGE>

For the seven-day period ended June 30, 1997 the Portfolios' yield and
effective yield were as follows:

<TABLE>
<CAPTION>
7-DAY
EFFECTIVE
PORTFOLIO/CLASS CLASS 7-DAY YIELD YIELD
- -------------------------------------------------- -------- ------------ ------------
<S> <C> <C> <C>
Treasury Securities............................... Class A 5.13 5.26
Class D 4.78 4.89
Government Securities............................. Class A 5.00 5.12
Prime Obligation.................................. Class A 5.28 5.42
Institutional Cash................................ Class A N/A N/A
Money Market...................................... Class A N/A N/A
</TABLE>

DETERMINATION OF NET ASSET VALUE

Securities of the Portfolios will be valued by the amortized cost method,
which involves valuing a security at its cost on the date of purchase and
thereafter (absent unusual circumstances) assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of fluctuations in
general market rates of interest on the value of the instrument. While this
method provides certainty in valuation, it may result in periods during which
value, as determined by this method is higher or lower than the price a
Portfolio would receive if it sold the instrument. During periods of declining
interest rates, the daily yield of a Portfolio may tend to be higher than a like
computation made by a company with identical investments utilizing a method of
valuation based upon market prices and estimates of market prices for all of its
portfolio securities. Thus, if the use of amortized cost by the Trust resulted
in a lower aggregate portfolio value on a particular day, a prospective investor
in a Portfolio would be able to obtain a somewhat higher yield than would result
from investment in a company utilizing solely market values, and existing
shareholders in the Portfolio would experience a lower yield. The converse would
apply in a period of rising interest rates.

The Trust's use of amortized cost valuation and the maintenance of the net
asset value of each Portfolio at $1.00 are permitted by Rule 2a-7, under the
1940 Act, provided that certain conditions are met. Under Rule 2a-7, a money
market portfolio must maintain a dollar-weighted average maturity in the
Portfolio of 90 days or less and not purchase any instrument having a remaining
maturity of more than 397 days. In addition, money market funds may acquire only
U.S. dollar denominated obligations that present minimal credit risks and that
are "eligible securities," which means they are (i) rated, at the time of
investment, by at least two nationally recognized statistical rating
organizations (one if it is the only organization rating such obligation) in the
highest short-term rating category or, if unrated, determined to be of
comparable quality (a "first tier security"), or (ii) rated according to the
foregoing criteria in the second highest short-term rating category or, if
unrated, determined to be of comparable quality ("second tier security"). The
Adviser will determine that an obligation presents minimal credit risks or that
unrated instruments are of comparable quality in accordance with guidelines
established by the Trustees. The Trustees must approve or ratify the purchase of
any unrated securities. In addition, investments in second tier securities are
subject to the further constraints that (i) no more than 5% of a Portfolio's
assets may be invested in such securities in the aggregate, and (ii) any
investment in such securities of one issuer is limited to the greater of 1% of
the Portfolio's total assets or $1 million.

The regulations also require the Trustees to establish procedures which are
reasonably designed to stabilize the net asset value per unit at $1.00 for each
Portfolio. However, there is no assurance that the Trust will be able to meet
this objective. The Trust's procedures include the determination of the extent
of deviation, if any, of each Portfolio's current net asset value per unit
calculated using available market quotations from each Portfolio's amortized
cost price per unit at such intervals as the Trustees deem appropriate and
reasonable in light of market conditions and periodic reviews of the amount of
the deviation and the methods used to calculate such deviation. In the event
that such deviation exceeds 1/2 of 1%, the Trustees are required to consider
promptly what action, if any, should be initiated, and, if the Trustees believe
that the extent of any deviation may result in material dilution or other unfair
results to

S-14
<PAGE>
shareholders, the Trustees are required to take such corrective action as they
deem appropriate to eliminate or reduce such dilution or unfair results to the
extent reasonably practicable. In addition, if any Portfolio incurs a
significant loss or liability, the Trustees have the authority to reduce pro
rata the number of shares of that Portfolio in each shareholder's account and to
offset each shareholder's pro rata portion of such loss or liability from the
shareholder's accrued but unpaid dividends or from future dividends.

PURCHASE AND REDEMPTION OF SHARES

Purchases and redemptions of shares of the Funds may be made on any day the
New York Stock Exchange is open for business. Currently, the following holidays
are observed by the Trust: New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day.

The Trust reserves the right to suspend the right of redemption and/or to
postpone the date of payment upon redemption for any period during which trading
on the New York Stock Exchange is restricted, or during the existence of an
emergency (as determined by the SEC by rule or regulation) as a result of which
disposal or evaluation of the portfolio securities is not reasonably
practicable, or for such other periods as the SEC may by order permit. The Trust
also reserves the right to suspend sales of shares of the Portfolio for any
period during which the New York Stock Exchange, the Manager, the Adviser, the
Distributor and/or the Custodian are not open for business.

SHAREHOLDER SERVICES (CLASS D SHARES)

STOP-PAYMENT REQUESTS: Investors may request a stop payment on checks by
providing the Trust with a written authorization to do so. Oral requests will be
accepted provided that the Trust promptly receives a written authorization. Such
requests will remain in effect for six months unless renewed or canceled. The
Trust will use its best efforts to effect stop-payment instructions, but does
not promise or guarantee that such instructions will be effective. Shareholders
requesting stop payment will be charged a $20 service fee per check which will
be deducted from their accounts.

RIGHT OF ACCUMULATION: A shareholder qualifies for cumulative quantity
discounts when his new investment, together with the current market value of all
holdings of that shareholder in certain eligible portfolios reaches a discount
level. See "Purchase and Redemption of Shares" in the Prospectuses for the sales
charge on quantity purchases.

LETTER OF INTENT: The reduced sales shares are also applicable to the
aggregate amount of purchases made by any such purchaser previously enumerated
within a 13-month period pursuant to a written Letter of Intent provided by the
Distributor, and not legally binding on the signer or a Portfolio which provides
for the holder in escrow by the Manager of 5% of the total amount intended to be
purchased until such purchase is completed within the 13-month period. A Letter
of Intent may be dated to include shares purchased up to 90 days prior to the
date of the Letter of Intent is signed. The 13-month period begins on the date
of the earliest purchase. If the intended investment is not completed, the
Manager will surrender an appropriate number of the escrowed shares for
redemption.

DISTRIBUTION INVESTMENT OPTION: Distributions of dividends and capital
gains made by the Portfolios may be automatically invested in shares of one of
the Portfolios if shares of the Portfolio are available for sale. Such
investments will be subject to initial investment minimums, as well as
additional purchase minimums. A shareholder considering the Distribution
Investment Option should obtain and read the prospectus of the Portfolios and/or
classes in which such automatic investments are to be made and consider the
differences in investment objectives and policies before making any investment.

REINSTATEMENT PRIVILEGE: A shareholder who has redeemed shares of any of
the Portfolios has a one-time right to reinvest the redemption proceeds in
shares of the Portfolio at their net asset value as of the time of reinvestment.
Such a reinvestment must be made within 30 days of the redemption and is limited
to

S-15
<PAGE>
the amount of the redemption proceeds. Although redemptions and repurchases of
shares are taxable events, a reinvestment within such 30-day period in the same
fund is considered a "wash sale" and results in the inability to recognize
currently all or a portion of a loss realized on the original redemption for
federal income tax purposes. The investor must notify the Transfer Agent at the
time the trade is placed that the transaction is a reinvestment.

EXCHANGE PRIVILEGE: Some or all of the shares of the Portfolio for which
payment has been received (I.E., an established account) may be exchanged, at
their net asset value, plus any applicable sales charge, for Class D shares of
the Trust, SEI Tax Exempt Trust, SEI International Trust and SEI Institutional
Managed Trust or at their net asset value for Class D shares of other portfolios
of such trusts that do not have sales charges. Exchanges will be made only after
proper instructions in writing or by telephone (an "Exchange Request") are
received for an established account by the Distributor.

A shareholder may exchange a Portfolio's Class D shares, for which good
payment has been received, in his account at any time, regardless of how long he
has held his shares.

Each Exchange Request must be in proper form (I.E., if in writing, signed by
the record owner(s) exactly as the shares are registered; if by telephone,
proper account identification is given by the dealer or shareholder of record),
and each exchange must involve either shares having an aggregate value of at
least $1,000 or all the shares in the account. Each exchange involves the
redemption of the shares of a Portfolio to be exchanged and the purchase of the
shares of the other Portfolio. Any gain or loss on the redemption of the shares
exchanged is reportable on the shareholder's Federal income tax return, unless
such shares were held in a tax-deferred retirement plan or other tax-exempt
account. If the Exchange Request is received by the Distributor in writing or by
telephone on any Business Day, as defined in the Prospectuses of the Trust,
prior to the close of the New York Stock Exchange, the exchange will be
effective on that day if all the restrictions set forth above have been complied
with at that time. However, payment of the redemption proceeds by the
Portfolios, and thus the purchase of shares of the other Portfolios, may be
delayed for up to seven days if the Portfolios determine that such delay would
be in the best interest of all of its shareholders. Investment dealers which
have satisfied criteria established by the Portfolios may also communicate a
shareholder's Exchange Request to the Portfolios subject to the restrictions set
forth above. No more than five exchange requests may be made in any one
telephone Exchange Request.

TAXES

The following is only a summary of certain tax considerations generally
affecting a Portfolio and its shareholders, and is not intended as a substitute
for careful tax planning. Shareholders are urged to consult their tax advisors
with specific reference to their own tax situations, including their state and
local tax liabilities.

FEDERAL INCOME TAXES

The following discussion of federal income tax consequences is based on the
Internal Revenue Code of 1986, as amended (the "Code"), and the regulations
issued thereunder as in effect on the date of this Statement of Additional
Information. New legislation, as well as administrative changes or court
decisions, may significantly change the conclusions expressed herein, and may
have a retroactive effect with respect to the transactions contemplated herein.

Each Portfolio intends to qualify as a regulated investment company ("RIC")
as defined under Subchapter M of the Code. By following such a policy, each of
the Portfolios expects to eliminate or reduce to a nominal amount the federal
income taxes to which such Portfolio may be subject.

In order to qualify for treatment as a RIC, a Portfolio must distribute
annually to its shareholders at least the sum of 90% of its net interest income
excludable from gross income plus 90% of its investment company taxable income
(generally, net investment income plus the excess of net short-term capital gain

S-16
<PAGE>

over net long-term capital loss) (the "Distribution Requirement") and also must
meet several additional requirements. Among these requirements are the
following: (i) at least 90% of a Portfolio's gross income each taxable year must
be derived from dividends, interest, payments with respect to securities loans,
and gains from the sale or other disposition of stock or securities, or other
income derived with respect to its business of investing in such stock or
securities; (ii) at the close of each quarter of a Portfolio's taxable year, at
least 50% of the value of its total assets must be represented by cash and cash
items, U.S. government securities, securities of other RIC's, and other
securities, with such other securities limited, in respect of any one issuer, to
an amount that does not exceed 5% of the value of a Portfolio's assets and that
does not represent more than 10% of the outstanding voting securities of such
issuer; and (iii) at the close of each quarter of a Portfolio's taxable year,
not more than 25% of the value of its assets may be invested in securities
(other than U.S. government securities or the securities of other RIC's) of any
one issuer or of two or more issuers which are engaged in the same, similar or
related trades or businesses if the Portfolio owns at least 20% of the voting
power of such issuers.

Notwithstanding the Distribution Requirement described above, which only
requires a Portfolio to distribute at least 90% of its annual investment company
taxable income and does not require any minimum distribution of net capital gain
(the excess of net long-term capital gain over net short-term capital loss), a
Portfolio will be subject to a nondeductible 4% federal excise tax to the extent
it fails to distribute by the end of any calendar year at least 98% of its
ordinary income for that year and 98% of its capital gain net income (the excess
of short and long-term capital gains over short and long-term capital losses)
for the one-year period ending on October 31 of that year, plus certain other
amounts. Each Portfolio intends to make sufficient distributions to avoid
liability for the federal excise tax. A Portfolio may in certain circumstances
be required to liquidate Portfolio investments in order to make sufficient
distributions to avoid federal excise tax liability at a time when the
investment advisor might not otherwise have chosen to do so, and liquidation of
investments in such circumstances may affect the ability of a Portfolio to
satisfy the requirements for qualification as a RIC.

Any gain or loss recognized on a sale, exchange or redemption of shares of a
Portfolio by a shareholder who is not a dealer in securities will generally, for
individual shareholders, be treated as a long-term capital gain or loss if the
shares have been held for more than eighteen months, mid-term capital gain if
the share have been held for more than twelve months but not more than eighteen
months, and otherwise will be treated as short-term capital gain or loss.
However, if shares on which a shareholder has received a net capital gain
distribution are subsequently sold, exchanged or redeemed and such shares have
been held for six months or less, any loss recognized will be treated as
long-term capital loss to the extent of the net capital gain distribution.
Long-term capital gains are currently taxed at a maximum rate of 20%, mid-term
capital gains are currently taxed at a maximum rate of 28%, and short-term
capital gains are currently taxed at ordinary income tax rates.

If a Portfolio fails to qualify as a RIC for any year, all of its taxable
income will be subject to tax at regular corporate rates without any deduction
for distributions to shareholders, and its distributions (including capital
gains distributions) generally will be taxable as ordinary income dividends to
its shareholders, subject to the dividends received deduction for corporate
shareholders.

A Portfolio will be required in certain cases to withhold and remit to the
United States Treasury 31% of amounts payable to any shareholder who (1) has
provided the Portfolio either an incorrect tax identification number or no
number at all, (2) who is subject to backup withholding by the Internal Revenue
Service for failure to properly report such payments of interest or dividends,
or (3) who has failed to certify to the Portfolio that such shareholder is not
subject to backup withholding.

S-17
<PAGE>
STATE TAXES

A Portfolio is not liable for any income or franchise tax in Massachusetts
if it qualifies as a RIC for federal income tax purposes. Depending upon state
and local law, distributions by the Portfolio to shareholders and the ownership
of shares may be subject to state and local taxes. Shareholders should consult
their own tax Advisers regarding the affect of federal, state and local taxes in
their own individual circumstances.

PORTFOLIO TRANSACTIONS

The Trust has no obligation to deal with any dealer or group of dealers in
the execution of transactions in portfolio securities. Subject to policies
established by the Trustees, the Adviser is responsible for placing orders to
execute Portfolio transactions. In placing orders, it is the Trust's policy to
seek to obtain the best net results taking into account such factors as price
(including the applicable dealer spread), size, type and difficulty of the
transaction involved, the firm's general execution and operational facilities,
and the firm's risk in positioning the securities involved. While the Adviser
generally seeks reasonably competitive spreads or commissions, the Trust will
not necessarily be paying the lowest spread or commission available. The Trust's
policy of investing in securities with short maturities will result in high
portfolio turnover. The Trust will not purchase portfolio securities from any
affiliated person acting as principal except in conformity with the regulations
of the Securities and Exchange Commission.

The Trust does not expect to use one particular dealer, but, subject to the
Trust's policy of seeking the best net results, dealers who provide supplemental
investment research to the Adviser may receive orders for transactions by the
Trust. Information so received will be in addition to and not in lieu of the
services required to be performed by the Adviser under the Advisory Agreements,
and the expenses of the Adviser will not necessarily be reduced as a result of
the receipt of such supplemental information.

The money market securities in which certain of the Portfolios invest are
traded primarily in the over-the-counter market. Where possible, the Adviser
will deal directly with the dealers who make a market in the securities
involved, except in those circumstances where better prices and execution are
available elsewhere. Such dealers usually are acting as principal for their own
account. On occasion, securities may be purchased directly from the issuer.
Money market securities generally are traded on a net basis and normally do not
involve either brokerage commissions or transfer taxes. The cost of executing
portfolio securities transactions of the Portfolio will primarily consist of
dealer spreads and underwriting commissions.

Since the Trust does not market its shares through intermediary brokers or
dealers, it is not the Trust's practice to allocate brokerage or principal
business on the basis of sales of its shares which may be made through such
firms. However, the Adviser may place portfolio orders with qualified
broker-dealers who recommend the Trust to clients, and may, when a number of
brokers and dealers can provide best price and execution on a particular
transaction, consider such recommendations by a broker or dealer in selecting
among broker-dealers.

For the Trust's fiscal years ended June 30, 1995, 1996 and 1997, no
brokerage fees were paid.

DESCRIPTION OF SHARES

The Declaration of Trust authorizes the issuance of an unlimited number of
shares of each Portfolio, each of which represents an equal proportionate
interest in that Portfolio. Each share of a Portfolio upon liquidation of that
Portfolio entitles a shareholder to a pro rata share in the net assets of that
Portfolio, after taking into account certain distribution expenses. Shareholders
have no preemptive rights. The Declaration of Trust provides that the Trustees
of the Trust may create additional portfolios of shares or classes of
portfolios. Any consideration received by the Trust for shares of any additional
Portfolio and

S-18
<PAGE>
assets in which such consideration is invested would belong to that Portfolio
and would be subject to the liabilities related thereto. Share certificates
representing the shares will not be issued.

LIMITATION OF TRUSTEES' LIABILITY

The Declaration of Trust provides that a Trustee shall be liable only for
his own willful defaults and, if reasonable care has been exercised in the
selection of officers, agents, employees or administrators, shall not be liable
for any neglect or wrongdoing of any such person. The Declaration of Trust also
provides that the Trust will indemnify its Trustees and officers against
liabilities and expenses incurred in connection with actual or threatened
litigation in which they may be involved because of their offices with the Trust
unless it is determined in the manner provided in the Declaration of Trust that
they have not acted in good faith in the reasonable belief that their actions
were in the best interests of the Trust. However, nothing in the Declaration of
Trust shall protect or indemnify a Trustee against any liability for his willful
misfeasance, bad faith, gross negligence or reckless disregard of his duties.

SHAREHOLDER LIABILITY

The Trust is an entity of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders of the Trust could, under
certain circumstances, be held personally liable for the obligations of the
Trust. However, the possibility of the shareholders' incurring financial loss
appears remote because the Trust's Declaration of Trust contains an express
disclaimer of shareholder liability for obligations of the Trust, and requires
that notice of such disclaimer be given in each agreement, obligation or
instrument entered into or executed by or on behalf of the Trust or the
Trustees. The Declaration of Trust provides for indemnification out of the
Trust's property for any shareholder held personally liable for the obligations
of the Trust.

5% SHAREHOLDERS

As of October 1, 1997, the following persons were the only persons who were
record owners (or to the knowledge of the Trust, beneficial owners) of 5% or
more of the shares of the Portfolios. The Trust believes that most of the shares
referred to below were held by the persons indicated in accounts for their
fiduciary, agency, or custodial customers.

Treasury Securities Portfolio: First Hawaiian Bank, Financial Management
Group, ATTN: Dolores Mollring, P.O. Box 3200, Honolulu, HI 96847-0001, 9.28%;
Repub & Co., c/o Imperial Trust Co., ATTN: Shirley Matthews, 201 N. Figueroa
Street #610, Los Angeles, CA 90012-2629, 9.63%; The Fulton Company, c/o The
Fulton Bank Trust Department, ATTN: Dennis Patrick, One Penn Square, Lancaster,
PA 17602-2853, 6.27%; Smith & Co., c/o First Security Bank of Utah, ATTN: Money
Market/Mutual Fund Desk, P.O. Box 25297, Salt Lake City, UT 84125-0297, 7.79%;
First Security Bank of Utah, Cash Management, ATTN: Paul Messervy, 41 East 100
South, Salt Lake City, UT 84111-1912, 7.58%.

Government Securities Portfolio: United Jersey Bank, ATTN: Joe Guitari, P.O.
Box 547, Hackensack, NJ 07602-0547, 12.54%; SEI Trust Company, c/o SEI
Corporation, ATTN: Sandra Crawford, P.O. Box 1100 Oaks, PA 19456-1100, 10.95%;
Trust Co. Of Texas, ATTN: Operations, 200 Cresent Court STE 1300, Dallas, TX
75701-1820, 9.64%.

Prime Obligation Portfolio: First Security Bank of Utah, Cash Management,
ATTN: Paul Messervy, 41 East 100 South, Salt Lake City, UT 84111-1912, 10.15%;
Smith and CO, c/o First Security Bank of Utah, ATTN: Money Market/Mutual Fund
Desk, P.O. Box 25297, Salt Lake City, UT 84125-0297, 21.28%; SEI Trust Company,
c/o SEI Corporation, ATTN: Sandra Crawford, P.O. Box 1100, Oaks, PA 19456-1100,
12.06%; Repub & Co., c/o Imperial Trust Co., ATTN: Shirley Matthews, 201 N.
Figueroa Street #610, Los Angeles, CA 90012-2629, 11.99%; BHC Securities Inc.,
ATTN: Cash Sweeps Department, One Commerce Square, 2005 Market Street 11th
Floor, Philadelphia, PA 19103-7042, 13.34%.

S-19
<PAGE>

EXPERTS

The financial statements incorporated by reference in this Statement of
Additional Information have been incorporated by reference in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm experts in auditing and accounting.

FINANCIAL STATEMENTS

The Trust's financial statements for the fiscal year ended June 30, 1997,
including notes thereto and the report of Price Waterhouse LLP thereon, are
herein incorporated by reference. A copy of the 1997 Annual Report must
accompany the delivery of this Statement of Additional Information.

S-20
<PAGE>
PART C. OTHER INFORMATION

POST-EFFECTIVE AMENDMENT NO. 21

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS:

(a) Financial Statements.

Part A: Financial Highlights

Part B: The following audited financial statements for the Treasury
Securities, Government Securities, Prime Obligation,
Institutional Cash and Money Market Portfolios for the fiscal
year ended June 30, 1997 and the report of the independent
auditors, Price Waterhouse LLP dated August 7, 1997 are
incorporated by reference to the Statement of Additional
Information from Form N-30D filed on August 25, 1997 with
Accession Number 0000935069-97-000126.

Schedule of Investments
Statement of Assets & Liabilities
Statement of Operations
Statement of Changes in Net Assets
Financial Highlights
Notes to Financial Statements

(b) Additional Exhibits.

<TABLE>
<S> <C>
(1) Registrant's Agreement and Declaration of Trust as originaly filed with
Registrant's Registration Statement on Form N-1A filed with the SEC on
July 29, 1981, as amended in Post-Effective Amendment No. 8 filed with the
SEC on March 7, 1988 is incorporated by reference to Post-Effective
Amendment No. 19 filed with the SEC on October 30, 1995.
(2)(a) Registrant's By-laws as originally filed with Pre-Effective Amendment No. 1
to Registrant's Registration Statement on Form N-1A filed with the SEC on
October 22, 1981 are incorporated by reference to Post-Effective Amendment
No. 19 filed with the SEC on October 30, 1995.
(2)(b) Amended By-Laws are filed herewith.
(3) Not applicable.
(4) Not applicable.
(5)(a) Investment Advisory Contract dated October 30, 1985 between TrustFunds
Liquid Asset Trust and Wellington Management Company as originally filed
with Post-Effective Amendment No. 5 to Registrant's Registration Statement
on Form N-1A filed with the SEC on June 13, 1986 is incorporated by
reference to Post-Effective Amendment No. 19 filed with the SEC on October
30, 1995.
(5)(b) Consent to Assignment and Assumption between SEI Financial Management
Corporation and SEI Fund Management dated August 21, 1996 is incorporated
by reference to Post-Effective Amendment No. 20 filed with the SEC on
August 28, 1996.
(6) Distribution Agreement dated November 29, 1982 between TrustFunds Liquid
Asset Trust and SEI Financial Services Company as originally filed with
Post-Effective Amendment No. 4 to Registrant's Registration Statement on
Form N-1A filed with the SEC on August 29, 1985 is incorporated by
reference to Post-Effective Amendment No. 19 filed with the SEC on October
30, 1995.
(7) Not applicable.
</TABLE>

C-1
<PAGE>

<TABLE>
<S> <C>
(8)(a) Custodian Agreement dated September 1, 1981 by and between TrustFunds Liquid
Asset Trust and The Philadelphia National Bank as originally filed with
Pre-Effective Amendment No. 1 to Registrant's Registration Statement on
Form N-1A filed with the SEC on October 22, 1981 is incorporated by
reference to Post-Effective Amendment No. 19 filed with the SEC on October
30, 1995.
(8)(b) Custodian Agreement dated October 25, 1984 between TrustFunds Liquid Asset
Trust and First Interstate Bank of Oregon as originally filed with
Post-Effective Amendment No. 4 to Registrant's Registration Statement on
Form N-1A filed with the SEC on August 29, 1985 is incorporated by
reference to Post-Effective Amendment No. 19 filed with the SEC on October
30, 1995.
(9) Management Agreement dated as of October 31, 1986 by and between TrustFunds
Liquid Asset Trust and SEI Financial Management Corporation as originally
filed with Post-Effective Amendment No. 8 to Registrant's Registration
Statement on Form N-1A filed with the SEC on March 7, 1988 is incorporated
by reference to Post-Effective Amendment No. 19 filed with the SEC on
October 30, 1995.
(10) Opinion and Consent of Counsel is filed herewith.
(11) Consent of Independent Accountants is filed herewith.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15)(a) Registrant's 12b-1 Distribution Plan as amended March 30, 1984 as originally
filed with Post-Effective Amendment No. 4 to Registrant's Registration
Statement on Form N-1A filed with the SEC on August 29, 1985 is
incorporated by reference to Post-Effective Amendment No. 19 filed with
the SEC on October 30, 1995.
(15)(b) Registrant's 12b-1 Distribution Plan with respect to the ProVantage Funds
Class as originally filed with Post-Effective Amendment No. 17 to
Registrant's Registration Statement on Form N-1A filed with the SEC on
August 27, 1993 is incorporated by reference to Post-Effective Amendment
No. 19 filed with the SEC on October 30, 1995.
(15)(c) Amended and Restated Distribution Plan is incorporated by reference to
Post-Effective Amendment No. 20 filed with the SEC on August 28, 1996.
(15)(d) Shareholder Service Plan and Agreement with respect to the Class D shares is
incorporated by reference to Post-Effective Amendment No. 20 filed with
the SEC on August 28, 1996.
(16) Performance Quotation Computation is filed herewith.
(17) Financial Data Schedules are filed herewith.
(18)(a) Rule 18f-3 Plan is incorporated by reference to Post-Effective Amendment No.
19 filed with the SEC on October 30, 1995.
(18)(b) Amendments to Rule 18f-3 Plan are incorporated by reference to
Post-Effective Amendment No. 20 filed with the SEC on August 28, 1996.
(24) Powers of Attorney for Robert A. Nesher, William M. Doran, F. Wendell Gooch,
Frank E. Morris, Mark E. Nagle, David G. Lee, George J. Sullivan, Jr. and
James M. Storey are filed herewith.
</TABLE>

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT:

See the Prospectus and the Statement of Additional Information filed
herewith regarding the Trust's control relationships. The Manager is a
subsidiary of SEI Investments Company which also controls the distributor of the
Registrant, SEI Investments Distribution Co., and other corporations engaged in
providing various financial and record keeping services, primarily to bank trust
departments, pension plan sponsors, and investment managers.

C-2
<PAGE>
ITEM 26. NUMBER OF HOLDERS OF SECURITIES:

As of October 1, 1997:

<TABLE>
<CAPTION>
NUMBER OF
RECORD
TITLE OF CLASS HOLDERS
- ---------------------------------------------------------------------------------- -------------
<S> <C>
Units of beneficial interest, without par value--
Treasury Securities Portfolio
Class A........................................................................... 58
Class D........................................................................... 4
Government Securities Portfolio................................................... 20
Prime Obligation Portfolio........................................................ 80
Institutional Cash Portfolio...................................................... N/A
Money Market Portfolio............................................................ N/A
</TABLE>

ITEM 27. INDEMNIFICATION:

Article VIII of the Agreement and Declaration of Trust filed as Exhibit 1 to
the Registration Statement is incorporated herewith. Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to
trustees, directors, officers and controlling persons of the Registrant by the
Registrant pursuant to the Declaration of Trust or otherwise, the Registrant is
aware that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act and, therefore,
is unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by trustees, directors, officers or controlling persons of the Registrant
in connection with the successful defense of any act, suit or proceeding) is
asserted by such trustees, directors, officers or controlling persons in
connection with the shares being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issues.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER:

The list required by this Item 28 of officers and partners of Wellington
Management Company, LLP, together with information as to any other business,
profession, vocation or employment of a substantial nature engaged in by such
officers and partners during the past two years, is incorporated by reference to
Schedules A and D of Form ADV, filed by Wellington Management Company, LLP,
pursuant to the Investment Advisers Act of 1940 (SEC File No. 801-15908).

ITEM 29. PRINCIPAL UNDERWRITERS:

(a) Furnish the name of each investment company (other than the Registrant)
for which each principal underwriter currently distributing the securities of
the Registrant also acts as a principal underwriter, distributor or investment
adviser.

C-3
<PAGE>

Registrant's distributor, SEI Investments Distribution Co., acts as
distributor for:

SEI Daily Income Trust July 15, 1982
SEI Tax Exempt Trust December 3, 1982
SEI Index Funds July 10, 1985
SEI Institutional Managed Trust January 22, 1987
SEI International Trust August 30, 1988
The Advisors' Inner Circle Fund November 14, 1991
The Pillar Funds February 28, 1992
CUFUND May 1, 1992
STI Classic Funds May 29, 1992
CoreFunds, Inc. October 30, 1992
First American Funds, Inc. November 1, 1992
First American Investment Funds, Inc. November 1, 1992
The Arbor Fund January 28, 1993
Boston 1784 Funds-Registered Trademark- June 1, 1993
The PBHG Funds, Inc. July 16, 1993
Marquis Funds-Registered Trademark- August 17, 1993
Morgan Grenfell Investment Trust January 3, 1994
The Achievement Funds Trust December 27, 1994
Bishop Street Funds January 27, 1995
CrestFunds, Inc. March 1, 1995
STI Classic Variable Trust August 18, 1995
ARK Funds November 1, 1995
Monitor Funds January 11, 1996
FMB Funds, Inc. March 1, 1996
SEI Asset Allocation Trust April 1, 1996
TIP Funds April 30, 1996
SEI Institutional Investments Trust June 14, 1996
First American Strategy Funds, Inc. October 1, 1996
HighMark Funds February 15, 1997
Armada Funds March 8, 1997
PBHG Insurance Series Fund, Inc. April 1, 1997
The Expedition Funds June 9, 1997

SEI Investments Distribution Co., provides numerous financial services to
investment managers, pension plan sponsors, and bank trust departments.
These services include portfolio evaluation, performance measurement and
consulting services ("Funds Evaluation") and automated execution, clearing
and settlement of securities transactions ("MarketLink").

(b) Furnish the Information required by the following table with respect to
each director, officer or partner of each principal underwriter named in the
answer to Item 21 of Part B. Unless otherwise noted, the business address of
each director or officer is Oaks, Pennsylvania 19456.

<TABLE>
<CAPTION>
POSITION AND OFFICE POSITIONS AND OFFICES
NAME WITH UNDERWRITER WITH REGISTRANT
- ------------------------------- ------------------------------------------------------ ------------------------
<S> <C> <C>
Alfred P. West, Jr. Director, Chairman & Chief Executive Officer --

Henry H. Greer Director, President & Chief Operating Officer --

Carmen V. Romeo Director, Executive Vice President & Treasurer --

Gilbert L. Beebower Executive Vice President --
</TABLE>

C-4
<PAGE>

<TABLE>
<CAPTION>
POSITION AND OFFICE POSITIONS AND OFFICES
NAME WITH UNDERWRITER WITH REGISTRANT
- ------------------------------- ------------------------------------------------------ ------------------------
<S> <C> <C>
Richard B. Lieb Executive Vice President, President-Investment --
Services Division

Leo J. Dolan, Jr. Senior Vice President --

Carl A. Guarino Senior Vice President --

Jerome Hickey Senior Vice President --

Steven Kramer Senior Vice President --

David G. Lee Senior Vice President President & Chief
Executive Officer

William Madden Senior Vice President --

A. Keith McDowell Senior Vice President --

Dennis J. McGonigle Senior Vice President --

Hartland J. McKeown Senior Vice President --

James V. Morris Senior Vice President --

Steven Onofrio Senior Vice President --

Kevin P. Robins Senior Vice President, General Counsel & Secretary Vice President &
Assistant Secretary

Robert Wagner Senior Vice President --

Patrick K. Walsh Senior Vice President --

Kenneth Zimmer Senior Vice President --

Kathryn L. Stanton Deputy General Counsel, Vice President & Assistant Vice President &
Secretary Assistant Secretary

Robert Crudup Vice President & Managing Director --

Vic Galef Vice President & Managing Director --

Kim Kirk Vice President & Managing Director --

John Krzeminski Vice President & Managing Director --

Carolyn McLaurin Vice President & Managing Director --

Barbara Moore Vice President & Managing Director --

Donald Pepin Vice President & Managing Director --

Mark Samuels Vice President & Managing Director --

Wayne M. Withrow Vice President & Managing Director --

Mick Duncan Vice President & Team Leader --

Vicki Malloy Vice President & Team Leader --

Robert S. Ludwig Vice President & Team Leader --

Robert Aller Vice President --

Marc H. Cahn Vice President & Assistant Secretary Vice President &
Assistant Secretary

Gordon W. Carpenter Vice President --

Todd Cipperman Vice President & Assistant Secretary Vice President &
Assistant Secretary
</TABLE>

C-5
<PAGE>
<TABLE>
<CAPTION>
POSITION AND OFFICE POSITIONS AND OFFICES
NAME WITH UNDERWRITER WITH REGISTRANT
- ------------------------------- ------------------------------------------------------ ------------------------
<S> <C> <C>
Ed Daly Vice President --

Jeff Drennen Vice President --

Kathy Heilig Vice President --

Larry Hutchison Vice President --

Michael Kantor Vice President --

Samuel King Vice President --

Donald H. Korytowski Vice President --

Jack May Vice President --

W. Kelso Morrill Vice President --

Sandra K. Orlow Vice President & Assistant Secretary Vice President &
Assistant Secretary

Barabara A. Nugent Vice President & Assistant Secretary Vice President &
Assistant Secretary

Larry Pokora Vice President --

Kim Rainey Vice President --

Paul Sachs Vice President --

Steve Smith Vice President --

Daniel Spaventa Vice President --

William Zawaski Vice President --

James Dougherty Director of Brokerage Services --
</TABLE>

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS:

Books or other documents required to be maintained by Section 31(a) of the
Investment Company Act of 1940, and the rules promulgated thereunder, are
maintained as follows:

(a) With respect to Rules 31a-1(a); 31a-1(b)(1); (2)(a) and (b); (3);
(6); (8); (12); and 31a-1(d), the required books and records are maintained
at the offices of Registrant's Custodian:

CoreStates Bank, N.A.
Broad and Chestnut Streets
P.O. Box 7618
Philadelphia, Pennsylvania 19101

(b)/(c) With respect to Rules 31a-1(a); 31a-1(b)(1), (4); (2)(C) and
(D); (4); (5); (6); (8); (9); (10); (11); and 31a-1(f), the required books
and records are maintained at the offices of Registrant's Manager:

SEI Fund Management
Oaks, Pennsylvania 19456

(d) With respect to Rules 31a-1(b)(5), (6), (9) and (10) and 31a-1(f),
the required books and records are maintained at the principal offices of
the Registrant's Adviser:

Wellington Management Company, LLP
75 State Street
Boston, Massachusetts 02109

C-6
<PAGE>
ITEM 31. MANAGEMENT SERVICES:

None.

ITEM 32. UNDERTAKINGS:

Registrant hereby undertakes that whenever shareholders meeting the
requirements of Section 16(c) of the Investment Company Act of 1940 inform the
Board of Trustees of their desire to communicate with shareholders of the Fund,
the Trustees will inform such shareholders as to the approximate number of
shareholders of record and the approximate costs of mailing or afford said
shareholders access to a list of shareholders.

Registrant hereby undertakes to call a meeting of shareholders for the
purpose of voting upon the question of removal of a Trustee(s) when requested in
writing to do so by the holders of at least 10% of Registrant's outstanding
shares and in connection with such meetings to assist in communications with
other shareholders as required by the provisions of Section 16(c) of the
Investment Company Act of 1940.

Registrant hereby undertakes to furnish each prospective person to whom a
prospectus for any series of the Registrant is delivered with a copy of the
Registrant's latest annual report to shareholders for such series, when such
annual report is issued containing information called for by Item 5A of Form
N-1A, upon request and without charge.

NOTICE

A copy of the Agreement and Declaration of Trust of SEI Liquid Asset Trust
is on file with the Secretary of State of The Commonwealth of Massachusetts and
notice is hereby given that this Registration Statement has been executed on
behalf of the Trust by an officer of the Trust as an officer and by its Trustees
as trustees and not individually and the obligations of or arising out of this
Registration Statement are not binding upon any of the Trustees, officers, or
Unitholders individually but are binding only upon the assets and property of
the Trust.

C-7
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, as amended, the Registrant certifies that it
meets all of the requirements for the effectiveness of this Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this Amendment to Registration Statement No. 2-73428 to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Oaks,
Commonwealth of Pennsylvania on the 20th day of October, 1997.

SEI LIQUID ASSET TRUST

By: /s/ DAVID G. LEE
-----------------------------------------
David G. Lee
PRESIDENT

Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons in
the capacity on the dates indicated.

*
- ------------------------------ Trustee October 20, 1997
William M. Doran

*
- ------------------------------ Trustee October 20, 1997
F. Wendell Gooch

*
- ------------------------------ Trustee October 20, 1997
Frank E. Morris

*
- ------------------------------ Trustee October 20, 1997
Robert A. Nesher

*
- ------------------------------ Trustee October 20, 1997
James M. Storey

*
- ------------------------------ Trustee October 20, 1997
George J. Sullivan

/s/ DAVID G. LEE
- ------------------------------ President, Chief October 20, 1997
David G. Lee Executive Officer

/s/ MARK E. NAGLE
- ------------------------------ Controller, Chief October 20, 1997
Mark E. Nagle Financial Officer

*By: /s/ DAVID G. LEE
-------------------------
David G. Lee
ATTORNEY IN FACT

C-8
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
- -------------------- -----------------------------------------------------------------------------------
<S> <C>
EX-99.B1 Registrant's Agreement and Declaration of Trust as originally filed with
Registrant's Registration Statement on Form N-1A filed with the SEC on July 29,
1981, as amended in Post-Effective Amendment No. 8 filed with the SEC on March 7,
1988 is incorporated by reference to Post-Effective Amendment No. 19 filed with
the SEC on October 30, 1995.

EX-99.B2(a) Registrant's By-laws as originally filed with Pre-Effective Amendment No. 1 to
Registrant's Registration Statement on Form N-1A filed with the SEC on October
22, 1981 are incorporated by reference to Post-Effective Amendment No. 19 filed
with the SEC on October 30, 1995.

EX-99.B2(b) Amended By-Laws are filed herewith.

EX-99.B3 Not applicable.

EX-99.B4 Not applicable.

EX-99.B5(a) Investment Advisory Contract dated October 30, 1985 between TrustFunds Liquid Asset
Trust and Wellington Management Company as originally filed with Post-Effective
Amendment No. 5 to Registrant's Registration Statement on Form N-1A filed with
the SEC on June 13, 1986 is incorporated by reference to Post-Effective Amendment
No. 19 filed with the SEC on October 30, 1995.

EX-99.B5(b) Consent to Assignment and Assumption between SEI Financial Management Corporation
and SEI Fund Management dated August 21, 1996 is incorporated by reference to
Post-Effective Amendment No. 20 filed with the SEC on August 28, 1996.

EX-99.B6 Distribution Agreement dated November 29, 1982 between TrustFunds Liquid Asset
Trust and SEI Financial Services Company as originally filed with Post-Effective
Amendment No. 4 to Registrant's Registration Statement on Form N-1A filed with
the SEC on August 29, 1985 is incorporated by reference to Post-Effective
Amendment No. 19 filed with the SEC on October 30, 1995.

EX-99.B7 Not applicable.

EX-99.B8(a) Custodian Agreement dated September 1, 1981 by and between TrustFunds Liquid Asset
Trust and The Philadelphia National Bank as originally filed with Pre-Effective
Amendment No. 1 to Registrant's Registration Statement on Form N-1A filed with
the SEC on October 22, 1981 is incorporated by reference to Post-Effective
Amendment No. 19 filed with the SEC on October 30, 1995.

EX-99.B8(b) Custodian Agreement dated October 25, 1984 between TrustFunds Liquid Asset Trust
and First Interstate Bank of Oregon as originally filed with Post-Effective
Amendment No. 4 to Registrant's Registration Statement on Form N-1A filed with
the SEC on August 29, 1985 is incorporated by reference to Post-Effective
Amendment No. 19 filed with the SEC on October 30, 1995.

EX-99.B9 Management Agreement dated as of October 31, 1986 by and between TrustFunds Liquid
Asset Trust and SEI Financial Management Corporation as originally filed with
Post-Effective Amendment No. 8 to Registrant's Registration Statement on Form
N-1A filed with the SEC on March 7, 1988 is incorporated by reference to
Post-Effective Amendment No. 19 filed with the SEC on October 30, 1995.

EX-99.B10 Opinion and Consent of Counsel is filed herewith.
</TABLE>

<PAGE>

EX-99.B12 Not applicable.

EX-99.B13 Not applicable.

EX-99.B14 Not applicable.

EX-99.B15(a) Registrant's 12b-1 Distribution Plan as amended March 30, 1984 as originally filed
with Post-Effective Amendment No. 4 to Registrant's Registration Statement on
Form N-1A filed with the SEC on August 29, 1985 is incorporated by reference to
Post-Effective Amendment No. 19 filed with the SEC on October 30, 1995.

EX-99.B15(b) Registrant's 12b-1 Distribution Plan with respect to the ProVantage Funds Class as
originally filed with Post-Effective Amendment No. 17 to Registrant's
Registration Statement on Form N-1A filed with the SEC on August 27, 1993 is
incorporated by reference to Post-Effective Amendment No. 19 filed with the SEC
on October 30, 1995.

EX-99.B15(c) Amended and Restated Distribution Plan is incorporated by reference to
Post-Effective Amendment No. 20 filed with the SEC on August 28, 1996.

EX-99.B15(d) Shareholder Service Plan and Agreement with respect to the Class D shares is
incorporated by reference to Post-Effective Amendment No. 20 filed with the SEC
on August 28, 1996.

EX-99.B16 Performance Quotation Computation is filed herewith.

EX-99.B18(a) Rule 18f-3 Plan is incorporated by reference to Post-Effective Amendment No. 19 to
Registrant's Registration Statement on Form N-1A filed with the SEC on October
30, 1995.

EX-99.B18(b) Amendments to Rule 18f-3 Plan are incorporated by reference to Post-Effective
Amendment No. 20 filed with the SEC on August 28, 1996.

EX-99.B24 Powers of Attorney for Robert A. Nesher, William M. Doran, F. Wendell Gooch, Frank
E. Morris, Mark E. Nagle, David G. Lee, George J. Sullivan, Jr. and James M.
Storey are filed herewith.

EX-27.1A Financial Data Schedules for the Treasury Securities Portfolio Class A

EX-27.1D Financial Data Schedules for the Treasury Securities Portfolio Class D

EX-27.2 Financial Data Schedules for the Government Securities Portfolio

EX-27.3 Financial Data Schedules for the Prime Obligation Portfolio

EX-27.4 Financial Data Schedules for the Institutional Cash Portfolio
</TABLE>

<PAGE>

BY-LAWS

SEI LIQUID ASSET TRUST
-------------------------------------------

Section 1. Agreement and Declaration of
Trust and Principal Office
-------------------------------------------

1.1 AGREEMENT AND DECLARATION OF TRUST. These By-Laws shall be subject to
the Agreement and Declaration of Trust, as from time to time in effect (the
"Declaration of Trust"), of SEI LIQUID ASSET TRUST, the Massachusetts business
trust established by the Declaration of Trust (the "Trust").

1.2 PRINCIPAL OFFICE OF THE TRUST. The principal office of the Trust shall
be located in Boston, Massachusetts.

Section 2. Shareholders
-------------------------------------------

2.1 MEETINGS. A meeting of the shareholders of the Trust or by any one or
more series of shares may be called at any time by the Trustees, by the
president or, if the Trustees and the president shall fail to call any meeting
of shareholders for a period of 30 days after written application of one or more
shareholders who at least 10% of all outstanding shares of the Trust, if
shareholders of all series are required under Declaration of Trust to vote the
aggregate and not by individual series at such meeting, or of any series, if
shareholders of such series are entitled under the Declaration of Trust to vote
by individual series at such meeting, then such shareholders may call such
meeting. If the meeting is a meeting of the shareholders of one or more series
of shares, but not a meeting of all shareholders of the Trust, then only the
shareholders of such one or more series shall be entitled to notice of and to
vote at the meeting. Each call of a meeting shall state the place, date, hour
and purpose of the meeting.

2.2 SPECIAL MEETINGS. A special meeting of the shareholders may be called
at any time by the Trustees, by the president or, if the Trustees and the
president shall fail to call any meeting of shareholders for a period of 30 days
after written application of one or more shareholders who hold at least 25% of
all shares issued and outstanding and entitled to vote at the meeting, then such
shareholders may call such meeting. Each call of a meeting shall state the
place, date, hour and purposes of the meeting.

2.3 PLACE OF MEETINGS. All meetings of the shareholders shall be held at
the principal office of the Trust, or, to the extent permitted by the
Declaration of Trust, at such other place within the United States as shall be
designated by the Trustees or the president of the Trust.

<PAGE>

2.4 NOTICE OF MEETINGS. A written notice of each meeting of shareholders,
stating the place, date and hour and the purposes of the meeting, shall be given
at least seven days before the meeting to each shareholder entitled to vote
thereat by leaving such notice with him or at his residence or usual place of
business or by mailing it, postage prepaid, and addressed to such shareholder at
his address as it appears in the records of the Trust. Such notice shall be
given by the secretary or an assistant secretary or by an officer designated by
the Trustees. No notice of any meeting of shareholders need be given to a
shareholder if a written waiver of notice, executed before or after the meeting
by such shareholder or his attorney thereunto duly authorized, is filed with the
records of the meeting.

2.5 BALLOTS. No ballot shall be required for any election unless requested
by a shareholder present or represented at the meeting and entitled to vote in
the election.

2.6 PROXIES. Shareholders entitled to vote may vote either in person or by
proxy in writing dated not more than six months before the meeting named
therein, which proxies shall be filed with the secretary or other person
responsible to record the proceedings of the meeting before being voted. Unless
otherwise specifically limited by their terms, such proxies shall entitle the
holders thereof to vote at any adjournment of such meeting but shall not be
valid after the final adjournment of such meeting.

Section 3. Trustees
-------------------------------------------

3.1 COMMITTEES AND ADVISORY BOARD. The Trustees may appoint from their
number an executive committee and other committees. Except as the Trustees may
otherwise determine, any such committee may make rules for conduct of its
business. The Trustees may appoint an advisory board to consist of not less
than two nor more than five members. The members of the advisory board shall be
compensated in such manner as the Trustees may determine and shall confer with
and advise the Trustees regarding the investments and other affairs of the
Trust. Each member of the advisory board shall hold office until the first
meeting of the Trustees following the next annual meeting of the shareholders
and until his successor is elected and qualified, or until he sooner dies,
resigns, is removed, or becomes disqualified, or until the advisory board is
sooner abolished by the Trustees.

3.2 REGULAR MEETINGS. Regular meetings of the Trustees may be held without
call or notice at such places and at such times as the Trustees may from time to
time determine, provided that notice of the first regular meeting following any
such determination shall be given to absent Trustees. A regular meeting of the
Trustees may be held without call or notice immediately after and at the same
place as the annual meeting of the shareholders.

3.3 SPECIAL MEETINGS. Special meetings of the Trustees may be held at any
time and at any place designated in the call of the meetings, when called by the
Chairman of the Board, the president or the treasurer or by two or more
Trustees, sufficient notice thereof being given to each Trustee by the secretary
or an assistant secretary or by the officer or one of the Trustees calling the
meeting.

-2-
<PAGE>

3.4 NOTICE. It shall be sufficient notice to a Trustee to send notice by
mail at least forty-eight hours or by telegram at least twenty-four hours before
the meeting addressed to the Trustee at his or her usual or last known business
or residence address or to give notice to him or her in person or by telephone
at least twenty-four hours before the meeting. Notice of a meeting need not be
given to any Trustee if a written waiver of notice, executed by him or her
before or after the meeting, is filed with the records of the meeting, or to any
Trustee who attends the meeting without protesting prior thereto or at its
commencement the lack of notice to him or her. Neither notice of a meeting nor
a waiver of a notice need specify the purposes of the meeting.

3.5 QUORUM. At any meeting of the Trustees one-third of the Trustees then
in office shall constitute a quorum; provided, however, a quorum shall not be
less than two. Any meeting may be adjourned from time to time by a majority of
the votes cast upon the question, whether or not a quorum is present, and the
meeting may be held as adjourned without further notice.

Section 4. Officers and Agents
-------------------------------------------

4.1 ENUMERATION; QUALIFICATION. The officers of the Trust shall be a
president, a treasurer, a secretary and such other officers, if any, as the
Trustees from time to time may in their discretion elect or appoint. The Trust
may also have such Agents, if any, as the Trustees from time to time may in
their discretion appoint. Any officer may be but none need be a Trustee or
shareholder. Any two or more offices may be held by the same person.

4.2 POWERS. Subject to the other provisions of these By-Laws, each officer
shall have, in addition to the duties and powers herein and in the Declaration
of Trust set forth, such duties and powers as are commonly incident to his or
her office as if the Trust were organized as a Massachusetts business
corporation and such other duties and powers as the Trustees may from time to
time designate.

4.3 ELECTION. The president, the treasurer and the secretary shall be
elected annually by the Trustees. Other officers, if any, may be elected or
appointed by the Trustees at said meeting or at any other time.

4.4 TENURE. The president, the treasurer and the secretary shall hold
office until their respective successors are chosen and qualified, or in each
case until he or she sooner dies, resigns, is removed or becomes disqualified.
Each other officer shall hold office at the pleasure of the Trustees. Each
agent shall retain his or her authority at the pleasure of the Trustees.

4.5 PRESIDENT AND VICE PRESIDENTS. The president shall be the chief
executive officer of the Trust. The president shall, subject to the control of
the Trustees, have general charge and supervision of the business of the Trust.
Any vice president shall have such duties and powers as shall be designated from
time to time by the Trustees.

-3-
<PAGE>

4.6 CHAIRMAN OF THE BOARD. If a Chairman of the Board of Trustees is
elected, he shall have the duties and powers specified in these By-Laws and,
except as the Trustees shall otherwise determine, preside at all meetings of the
stockholders and of the Trustees at which he or she is present and have such
other duties and powers as may be determined by the Trustees.

4.7 TREASURER AND CONTROLLER. The treasurer shall be the chief financial
officer of the Trust and subject to any arrangement made by the Trustees with a
bank or trust company or other organization as custodian or transfer or
shareholder services agent, shall be in charge of its valuable papers and shall
have such other duties and powers as may be designated from time to time by the
Trustees or by the president. If at any time there shall be no controller, the
treasurer shall also be the chief accounting officer of the Trust and shall have
the duties and powers prescribed herein for the controller. Any assistant
treasurer shall have such duties and powers as shall be designated from time to
time by the Trustees.

The controller, if any be elected, shall be the chief accounting officer of the
Trust and shall be in charge of its books of account and accounting records.
The controller shall be responsible for preparation of financial statements of
the Trust and shall have such other duties and powers as may be designated from
time to time by the Trustees or the president.

4.8 SECRETARY AND ASSISTANT SECRETARIES. The secretary shall record all
proceedings of the shareholders and the Trustees in books to be kept therefor,
which books shall be kept at the principal office of the Trust. In the absence
of the secretary from any meeting of shareholders or Trustees, an assistant
secretary, or if there be none or he or she is absent, a temporary clerk chosen
at the meeting shall record the proceedings thereof in the aforesaid books.

Section 5. Resignation and Removals
-------------------------------------------

Any Trustee, officer or advisory board member may resign at any time by
delivering his or her resignation in writing to the Chairman of the Board, the
president, the treasurer or the secretary or to a meeting of the Trustees. The
Trustees may remove any officer elected by them with or without cause by a vote
of a majority of the Trustees then in office. Except to the extent expressly
provided in a written agreement with the Trust, no Trustee, officer, or advisory
board member resigning, and no officer or advisory board member removed shall
have any right to any compensation for any period following his or her
resignation or removal, or any right to damages on account of such removal.

Section 6. Vacancies
-------------------------------------------

A vacancy in any office may be filled at any time. Each successor shall hold
office for the unexpired term, and in the case of the president, the treasurer
and the secretary, until his or her successor is chosen and qualified, or in
each case until he or she sooner dies, resigns, is removed or becomes
disqualified.

-4-
<PAGE>

Section 7. Shares
-------------------------------------------

7.1 SHARE CERTIFICATES. No certificates certifying the ownership of shares
shall be issued except as the Trustees may otherwise authorize. In the event
that the Trustees authorize the issuance of share certificates, subject to the
provisions of Section 7.3, each shareholder shall be entitled to a certificate
stating the number of shares owned by him or her, in such form as shall be
prescribed from time to time by the Trustees. Such certificate shall be signed
by the president or a vice president and by the treasurer or an assistant
treasurer. Such signatures may be facsimiles if the certificate is signed by a
transfer or shareholder services agent or by a registrar, other than a Trustee,
officer or employee of the Trust. In case any officer who has signed or whose
facsimile signature has been placed on such certificate shall have ceased to be
such officer before such certificate is issued, it may be issued by the Trust
with the same effect as if he or she were such officer at the time of its issue.

In lieu of issuing certificates for shares, the Trustees or the transfer or
shareholder services agent may either issue receipts therefor or may keep
accounts upon the books of the Trust for the record holders of such shares, who
shall in either case be deemed, for all purposes hereunder, to be the holders of
certificates for such shares as if they had accepted such certificates and shall
be held to have expressly assented and agreed to the terms hereof.

7.2 LOSS OF CERTIFICATES. In the case of the alleged loss or destruction or
the mutilation of a share certificate, a duplicate certificate may be issued in
place thereof, upon such terms as the Trustees may prescribe.

7.3 DISCONTINUANCE OF ISSUANCE OF CERTIFICATES. The Trustees may at any
time discontinue the issuance of share certificates and may, by written notice
to each shareholder, require the surrender of share certificates to the Trust
for cancellation. Such surrender and cancellation shall not affect the
ownership of shares in the Trust.

Section 8. Record Date
-------------------------------------------

The Trustees may fix in advance a time, which shall not be more than 60 days
before the date of any meeting of shareholders or the date for the payment of
any dividend or making of any other distribution to shareholders, as the record
date for determining the shareholders having the right to notice and to vote at
such meeting and any adjournment thereof or the right to receive such dividend
or distribution, and in such case only shareholders of record on such record
date shall have such right, notwithstanding any transfer of shares on the books
of the Trust after the record date.

-5-
<PAGE>

Section 9. Seal
-------------------------------------------

The seal of the Trust shall, subject to alteration by the Trustees, consist of a
flat-faced circular die with the word "Massachusetts", together with the name of
the Trust and the year of its organization, cut or engraved thereon; but, unless
otherwise required by the Trustees, the seal shall not be necessary to be placed
on, and its absence shall not impair the validity of, any document, instrument
or other paper executed and delivered by or on behalf of the Trust.

Section 10. Execution of Papers
-------------------------------------------

Except as the Trustees may generally or in particular cases authorize the
execution thereof in some other manner, all deeds, leases, transfers, contracts,
bonds, notes, checks, drafts and other obligations made, accepted or endorsed by
the Trust shall be signed, and any transfers of securities standing in the name
of the Trust shall be executed, by the president or by one of the vice
presidents or by the treasurer or by whomsoever else shall be designated for
that purpose by the vote of the Trustees and need not bear the seal of the
Trust.

Section 11. Fiscal Year
-------------------------------------------

The fiscal year of the Trust shall end on such date in each year as the Trustees
shall from time to time determine.

Section 12. Provisions Relating to the
Conduct of the Trust's Business
--------------------------------------------------

12.1 DEALINGS WITH AFFILIATES. No officer, Trustee or agent of the Trust and
no officer, director or agent of any investment advisor shall deal for or on
behalf of the Trust with himself as principal or agent, or with any partnership,
association or corporation in which he has a material financial interest;
provided that the foregoing provisions shall not prevent (a) officers and
Trustees of the Trust from buying, holding or selling shares in the Trust, or
from being partners, officers or directors of or financially interested in any
investment advisor to the Trust or in any corporation, firm or association which
may at any time have a distributor's or principal underwriter's contract with
the Trust; (b) purchases or sales of securities or other property if such
transaction is permitted by or is exempt or exempted from the provisions of the
Investment Company Act of 1940 or any Rule or Regulation thereunder and if such
transaction does not involve any commission or profit to any security dealer who
is, or one or more of whose partners, shareholders, officers or directors is, an
officer or Trustees of the Trust or an officer or director of the investment
advisor, manager or principal underwriter of the Trust; (c) employment of legal
counsel, registrar, transfer agent, shareholder services, dividend disbursing
agent or custodian who is, or has a partner, stockholder, officer or director
who is, an officer or Trustee of the Trust; (d) sharing statistical, research
and management expenses, including

-6-
<PAGE>

office hire and services, with any other company in which an officer or Trustee
of the Trust is an officer or director or financially interested.

12.2 DEALING IN SECURITIES OF THE TRUST. The Trust, the investment advisor,
any corporation, firm or association which may at any time have an exclusive
distributor's or principal underwriter's contract with the Trust (the
"distributor") and the officers and Trustees of the Trust and officers and
directors of every investment advisor and distributor, shall not take long or
short positions in the securities of the Trust, except that:

(a) the distributor may place orders with the Trust for its shares
equivalent to orders received by the distributor;

(b) shares of the Trust may be purchased at not less than net asset
value for investment by the investment advisor and by officers and
directors of the distributor, investment advisor, or the Trust and by
any trust, pension, profit-sharing or other benefit plan for such
persons, no such purchase to be in contravention of any applicable state
or federal requirement.

12.3 LIMITATION ON CERTAIN LOANS. The Trust shall not make loans to any
officer, Trustee or employee of the Trust or any investment advisor or
distributor or their respective officers, directors or partners or employees.

12.4 CUSTODIAN. All securities and cash owned by the Trust shall be
maintained in the custody of one or more banks or trust companies having
(according to its last published report) not less than two million dollars
($2,000,000) aggregate capital, surplus and undivided profits (any such bank or
trust company is hereinafter referred to as the "custodian"); provided, however,
the custodian may deliver securities as collateral on borrowings effected by the
Trust, provided, that such delivery shall be conditioned upon receipt of the
borrowed funds by the custodian except where additional collateral is being
pledged on an outstanding loan and the custodian may deliver securities lent by
the Trust against receipt of initial collateral specified by the Trust. Subject
to such rules, regulations and orders, if any, as the Securities and Exchange
Commission may adopt, the Trust may, or may permit any custodian to, deposit all
or any part of the securities owned by the Trust in a system for the central
handling of securities operated by the Federal Reserve Banks, or established by
a national securities exchange or national securities association registered
with said Commission under the Securities Exchange Act of 1934, or such other
person as may be permitted by said Commission, pursuant to which system all
securities of any particular class or series of any issue deposited with the
system are treated as fungible and may be transferred or pledged by bookkeeping
entry, without physical delivery of such securities.

The Trust shall upon the resignation or inability to serve of its custodian or
upon change of the custodian:

(a) in the case of such resignation or inability to serve use its
best efforts to obtain a successor custodian;

-7-
<PAGE>

(b) require that the case and securities owned by this corporation be
delivered directly to the successor custodian; and

(c) in the event that no successor custodian can be found, submit to
the shareholders, before permitting delivery of the case and securities
owned by this Trust otherwise than to a successor custodian, the
question whether or not this Trust shall be liquidated or shall function
without a custodian.

12.5 REPORTS TO SHAREHOLDERS; DISTRIBUTIONS FROM REALIZED GAINS. The Trust
shall send to each shareholder of record at least annually a statement of the
condition of the Trust and of the results of its operation, containing all
information required by applicable laws or regulations.

Section 13. Amendments
-------------------------------------------

These By-Laws may be amended or repealed, in whole or in part, by a majority of
the Trustees then in office at any meeting of the Trustees, or by one or more
writings signed by such majority.

-8-

<PAGE>

[ROPES & GRAY LETTERHEAD]

October 21, 1981

TrustFunds Liquid Asset Trust
28 State Street
Boston, Massachusetts 02109

Gentlemen:

We are furnishing this opinion with respect to the proposed offer and sale
from time to time of an indefinite number of shares of beneficial interest (the
"Shares") of TrustFunds Liquid Asset Trust (the "Trust"), being registered under
the Securities Act of 1933 by Registration Statement on Form N-1 No. 2-73428 of
the Trust.

We have acted as counsel for the Trust since its organization and are
familiar with the action taken by its Trustees to authorize the issuance of the
Shares. We have examined its records of shareholder action, its By-Laws and its
Agreement and Declaration of Trust on file at the Office of the Secretary of the
Common wealth of Massachusetts. We have examined a certificate of the Treasurer
of the Trust dated today stating that there are issued and outstanding 100,000
shares of beneficial interest, and that the Trust has received the appropriate
consideration for such outstanding shares. We have also examined such other
documents as we deem necessary for the purpose of this opinion.

We supervised the action taken by the Trust to effect registration with the
Securities and Exchange Commission as a management investment company by the
filing of a Notification of Registration on Form N-8A under the Investment
Company Act of 1940. We have examined copies of a Registration Statement, as
amended, under said Act and under the Securities Act of 1933 on Form N-1, in the
forms filed or to be filed with the Securities and Exchange Commission.

We assume that appropriate action will be taken to register or qualify the
sale of the Shares under any applicable state and federal laws regulating sales
and offerings of securities and that upon sales of the Shares the Trust will
receive the net asset value thereof.

Based upon the foregoing, we are of the opinion that:

1. The Trust is a legally organized and validly existing unincorporated
voluntary association under the laws of The Commonwealth of Massachusetts and is
authorized to issue an unlimited number of shares, of which 100,000 shares are
presently issued and outstanding.

<PAGE>

2. Upon the issue of any of the Shares for cash at net asset value and
receipt by the Trust of the authorized consideration therefor, the Shares so
issued will be validly issued, fully paid and nonassessable by the Trust.

The Trust is an entity of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders could, under certain
circumstances, be held personally liable for the obligations of the Trust.
However, the Agreement and Declaration of Trust disclaims shareholder liability
for acts or obligations of the Trust and requires that notice of such disclaimer
be given in each agreement, obligation, or instrument entered into or executed
by the Trust or the Trustees. The Agreement and Declaration of Trust provides
for indemnification out of the Trust property for all loss and expense of any
shareholder held personally liable for the obligations of the Trust. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which the Trust itself would be unable
to meet its obligations.

We understand that his opinion is to be used in connection with the
registration of the Shares for offering and sale pursuant to the Securities Act
of 1933. We consent to the filing of this opinion with and as a part of said
Registration Statement on Form N-1 and amendments thereto, and to our being
named as legal counsel under the caption "Counsel and Auditors" in the
Prospectus included in said Registration Statement.

Very truly yours,

/s/ Ropes & Gray

Ropes & Gray

<PAGE>

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Prospectuses and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 21 to the registration statement on Form N-1A (the
"Registration Statement") of our report dated August 7, 1997, relating to the
financial statements and financial highlights of Treasury Securities
Portfolio, Government Securities Portfolio, Prime Obligation Portfolio,
Institutional Cash Portfolio and Money Market Portfolio (constituting SEI
Liquid Asset Trust, hereafter referred to as the "Trust") appearing in the
June 30, 1997 Annual Report to Shareholders of the Trust, which is also
incorporated by reference into the Registration Statement. We also consent to
the references to us under the headings "Financial Highlights" and
"Independent Accountants" in the Prospectuses and under the headings
"Experts" and "Financial Statements" in the Statement of Additional
Information.

PRICE WATERHOUSE LLP

Philadelphia, PA
October 21, 1997

<PAGE>

EXHIBIT 16

This schedule is included to illustrate how yield will be calculated. The
examples presented utilize actual data from the Trust which has a fiscal year
ended 6/30/92.

SCHEDULE FOR COMPUTATION OF PERFORMANCE QUOTATIONS

FOR THE SEVEN-DAY PERIOD ENDED JUNE 30, 1992:

LAST 7 DAILY DIVIDEND FACTORS:

Prime Institutional Money
Treasury Government Obligation Cash* Market*
----------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C>

day 1. . . . . . . . . . . . . . . . . . . . . . . . . .000102768 .000104582 .000100359 .000094575 .000100359
day 2. . . . . . . . . . . . . . . . . . . . . . . . . .000101693 .000103497 .000100394 .000094575 .000100394
day 3. . . . . . . . . . . . . . . . . . . . . . . . . .000101290 .000102756 .000100280 .000094575 .000100280
day 4. . . . . . . . . . . . . . . . . . . . . . . . . .000101290 .000102756 .000100280 .000094575 .000100280
day 5. . . . . . . . . . . . . . . . . . . . . . . . . .000101290 .000102756 .000100280 .000094575 .000100280
day 6. . . . . . . . . . . . . . . . . . . . . . . . . .000102493 .000104255 .000100336 .000094575 .000100336
day 7. . . . . . . . . . . . . . . . . . . . . . . . . .000101804 .000101742 .000100285 .000094575 .000100265
---------- ---------- ---------- ---------- ----------
Base Period Return (bpr) . . . . . . . . . . . . . . . .000712629 .000722344 .000702194 .000662025 .000702194
Annualized Yield = (bpr/1) X 365/7 . . . . . . . . . . 3.72% 3.77% 3.66% 3.45% 3.66%
Effective Yield = ((bpr + 1) to the 365/7 power) - 1 . 3.78% 3.64% 3.73% 3.51% 3.73%

</TABLE>

* This portfolio was not in operation for the seven day period ended June 30,
1992. The dividend factors presented are an estimate of future operations.

<PAGE>

SEI ASSET ALLOCATION TRUST
SEI LIQUID ASSET TRUST
SEI DAILY INCOME TRUST
SEI TAX EXEMPT TRUST
SEI INDEX FUNDS
SEI INSTITUTIONAL MANAGED TRUST
SEI INSTITUTIONAL INVESTMENTS TRUST
SEI INTERNATIONAL TRUST

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned trustee and/or
officer of the above referenced funds (the "Trusts"), each a business trust
organized under the laws of The Commonwealth of Massachusetts, hereby
constitutes and appoints David G. Lee and Kevin P. Robins, and each of them
singly, his or her true and lawful attorney-in-fact and agent with full power of
substitution and resubstitution, to sign for him or her and in his or her name,
place and stead, and in the capacity indicated below, to sign any or all
amendments (including post-effective amendments) to each Trust's Registration
Statement on Form N-1A under the provisions of the Investment Company Act of
1940 and the Securities Act of 1933, each such Act as amended, and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, acting alone, full power and
authority to do and perform each and every act and thing requisite or necessary
to be done in and about the premises, as fully to all intents and purposes as he
or she might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.