Independent Auditors' Report on Internal Accounting Control
The Board of Directors and Shareholders
Sit Large Cap Growth Fund, Inc.:
Sit Mid Cap Growth Fund, Inc.
Sit Mutual Funds, Inc.
In planning and performing our audits of the financial statements of Sit
Balanced Fund (a series of Sit Mutual Funds, Inc.), Sit Large Cap
Growth Fund, Inc., Sit Regional Growth Fund (a series of Sit Mutual
Funds, Inc.), Sit Mid Cap Growth Fund, Inc., Sit International Growth
Fund (a series of Sit Mutual Funds, Inc.), Sit Small Cap Growth Fund
(a series of Sit Mutual Funds, Inc.), Sit Science and Technology Fund
(a series of Sit Mutual Funds, Inc.), and Sit Developing Markets
Growth Fund (a series of Sit Mutual Funds, Inc.), for the year ended
June 30, 2000, we considered their internal control, including control
activities for safeguarding securities, in order to determine our auditing
procedures for the purpose of expressing our opinion on the financial
statements and to comply with the requirements of Form N-SAR, not
to provide assurance on internal control.
The management of the Company is responsible for establishing and
maintaining internal control. In expected benefits and related costs of
controls. Generally, controls that are relevant to an audit fulfilling this
responsibility, estimates and judgments by management are required to
assess the pertain to the entity's objective of preparing financial
statements for external purposes that are fairly presented in conformity
with generally accepted accounting principles. Those controls include
the safeguarding of assets against unauthorized acquisition, use, or
disposition.
Because of inherent limitations in internal control, errors or fraud may
occur and not be detected. Also, projection of any evaluation of the
internal control to future periods is subject to the risk that it may
become inadequate because of changes in conditions or that the
effectiveness of the design and operation may deteriorate.
Our consideration of internal control would not necessarily disclose all
matters in internal control that might be material weaknesses under
standards established by the American Institute of Certified Public
Accountants. A material weakness is a condition in which the design or
operation of one or more of the internal control components does not
reduce to a relatively low level the risk that misstatements caused by
error or fraud in amounts that would be material in relation to the
financial statements being audited may occur and not be detected
within a timely period by employees in the normal course of
performing their assigned functions. However, we noted no matters
involving the internal control and its operation, including controls for
safeguarding securities, that we consider to be material weaknesses as
defined above.
This report is intended solely for the information and use of
management, the Board of Directors, and the Securities and Exchange
Commission and is not intended to be and should not be used by
anyone other than these specified parties.
KPMG LLP
Minneapolis, MN
August 4, 2000
