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<PAGE> PAGE 2
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<PAGE> PAGE 3
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SIGNATURE NICHOLAS DALMASO
TITLE ASSISTANT SECRETARY
EXHIBIT 77B
[Price Waterhouse LLP Letterhead]
January 29, 1998
To the Shareholders and Board of Trustees of
The Van Kampen American Capital Harbor Fund
In planning and performing our audit of the financial
statements of Van Kampen American Capital Harbor Fund (the
"Fund") for the year ended December 31, 1997, we considered
its 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 Fund is responsible for establishing
and maintaining internal control. In fulfilling this
responsibility, estimates and judgments by management are
required to assess the expected benefits and related costs
of control activities. Generally, control activities that
are relevant to an audit 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 control activities include the
safeguarding of assets against unauthorized acquisition, use
or disposition.
Because of inherent limitations in internal control, errors
or irregularities may occur and not be detected. Also,
projection or any evaluation of 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 any specific internal control components does
not reduce to a relatively low level the risk that errors
or irregularities in amounts that would be material in
relation to the financial statements being audited may
occur and not be detected within a timely period by
employees in the normal course of performing their
assigned functions. However, we noted no matters involving
internal control, including control activities for
safeguarding securities, that we consider to be material
weaknesses as defined above as of December 31, 1997.
This report is intended solely for the information and use
of management and the Board of Trustees of the Fund and the
Securities and Exchange Commission.
Price Waterhouse LLP
PRICE WATERHOUSE LLP
NSAR ITEM 77C
Van Kampen American Capital Harbor Fund
(a) A Special Meeting of Shareholders was held on May 28, 1997.
(b) The election of Trustees of Van Kampen American Capital Harbor Fund
(the "Fund") included:
J. Miles Branagan, Richard M. DeMartini, Linda Hutton Heagy,
R. Craig Kennedy, Jack E. Nelson, Jerome L. Robinson, Phillip B.
Rooney, Fernando Sisto and Wayne W. Whalen
(c) The following were voted on at the meeting:
1) Approval of New Investment Advisory Agreement in the
event of a change of control of the Adviser.
For 18,881,844 Against 363,129
4) For each AC Fund, to Ratify the Selection of Price
Waterhouse LLP Independent Public Accountants for its
Current Fiscal Year.
For 19,294,463 Against 164,020
NSAR ITEM 77O
VKAC Harbor Fund
10f-3 Transactions
<TABLE>
<CAPTION>
Underwriting # Underwriting Purchased From Amount of shares % of Underwriting Date of Purchase
Purchased
<S> <C> <C> <C> <C> <C>
1 U.S. Filter Corp. DLJ 2,000,000 1.000% 12/12/96
2 Microsoft Corporation Goldman, Sachs 35,000 0.320% 12/17/96
3 BA Merchant Services Goldman, Sachs 1,300 0.009% 12/18/97
4 National Australia Bank Merrill Lynch 160,000 0.021% 03/13/97
5 SBC Communications Inc. Salomon Brothers 85,000 0.800% 03/20/97
6 Boston Chicken, Inc. Merrill Lynch 2,550,000 1.020% 04/22/97
7 Houston Industries, Inc. Goldman Sachs 63,750 0.319% 07/09/97
8 MedPartners, Inc. Smith Barney 88,000 0.465% 09/15/97
9 Snyder Communications Merrill Lynch 123,000 2.733% 09/18/97
10 China Telecom Limited Goldman Sachs 116,000 0.089% 10/16/97
11 EVI, Inc. Donaldson, Lufkin & 85,000 1.214% 10/29/97
Jenrette
12 Omnicare First Boston 4,800,000 1.600% 12/04/97
13 Newell Financial Trust Goldman Sachs 55,000 0.640% 12/08/97
</TABLE>
Other Firms participating in Underwriting:
Underwriting for #1
Donaldson, Lufkin & Jenrette
Salomon Brothers Inc.
Deutsche Morgan Grenfell
Natwest Securities Limited
Smith Barney, Inc.
Underwriting for #2
Deutsche Morgan Grenfell
Goldman, Sachs & Co.
Salomon Brothers Inc.
Smith Barney Inc.
Alex, Brown & Sons Incorporated
Morgan Stanley & Co. Incorporated
Allen & Company Incorporated
BT Securities Corporation
Bear, Stearns & Co., Inc.
Cowen & Company
Dain Bosworth Incorporated
Dean Witter Reynolds Inc.
Dillon, Read & Co., Inc.
Donaldson, Lufkin & Jenrette Securities Corporation
Furman Selz LLC
Edward D. Jones & Co., L.P.
Montgomery Securities
PaineWebber Incorporated
Piper Jaffray Inc.
Prudential Securities Incorporated
Ragen MacKenzie Incorporated
Robertson, Stephens & Company LLC
SoundView Financial Group, Inc.
Underwriting for #3
Goldman, Sachs & Co.
Montgomery Securities
Salomon Brothers Inc.
Robert W. Baird & Co., Incorporated
Underwriting for #3 (con't)
Sanford C. Bernstein & Co., Inc.
Alex, Brown & Sons Incorporated
Chase Securities Inc.
Cowen & Company
Dain Bosworth Incorporated
Dean Witter Reynolds Inc.
A.G. Edwards & Sons, Inc.
Furman Selz LLC
Gerard Klauer Mattison & Co., LLC
Janney Montgomery Scott Inc.
Edward D. Jones & Co., L.P.
Legg Mason Wood Walker Incorporated
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Robertson, Stephens & Company LLC
Wasserstein Perella Securities, Inc.
Wheat First Butcher Singer
Underwriting for #4
Merrill Lynch, Inc.
Morgan Stanley & Co, Incorporated
Keefe, Bruyette & Woods, Inc.
J.B. Were & Son Inc.
First of Michigan Corporation
Roney & Co., LLC
Utendahl Capital Partners, L.P.
Underwriting for #5
Salomon Brothers Inc.
Credit Suisse First Boston Corp.
Bear, Stearns & Co., Inc.
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Inc.
Underwriting for #6
Merrill Lynch, Inc.
Alex, Brown & Sons, Incorporated
Morgan Stanley & Co., Incorporated
Underwriting for #7
Goldman, Sachs & Co.
Credit Suisse First Boston Corporation
Merrill Lynch, Pierce, Fenner & Smith Incorporated
George K. Baum & Company
CIBC Wood Grundy Securities Corp.
Chase Securities Inc.
EVEREN Securities Inc.
Lehman Brothers Inc.
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Inc.
Smith Barney Inc.
Stephens Inc.
Stifel, Nicolaus & Company, Inc.
UBS Securities, LLC
SBC Warburg Inc.
Underwriting for #8
Smith Barney Inc.
Credit Suisse First Boston Corp.
Merrill Lynch, Inc.
Montgomery Securities
Morgan Stanley & Co., Inc.
Piper Jaffray Inc.
ABN AMRO Chicago, Corp.
Bear, Stearns, & Co., Inc.
Sanford C. Bernstein & Co., Inc.
Cowen & Company
A.G. Edwards & Sons, Inc.
EVEREN Securities Inc.
Lehman Brothers Inc.
Needham & Company Inc.
The Robinson-Humphrey Company, Inc.
Rothschild Inc.
Salomon Brothers Inc.
Sterne, Agee & Leach, Inc.
UBS Securities, LLC
Vector Securities International Inc.
Wasserstein Perella Securities Inc.
Wessels, Arnold & Henderson, LLC
Underwriting for #9
Merrill Lynch & Co.
Goldman, Sachs & Co.
Morgan Stanley Dean Witter
Montgomery Securities
Bear, Stearns & Co. Inc.
Underwriting for #10
Goldman, Sachs & Co.
China International Capital Corporation
Morgan Stanley & Co. Incorporation
Bear, Stearns & Co., Inc.
Donaldson, Lufkin & Jenrette Securities Corporation
Merrill Lynch, Inc.
Credit Suisse First Boston
Prudential Securities Inc.
RBC Dominion Securities Corp.
Salomon Brothers Inc.
Smith Barney, Inc.
Underwriting for #11
Donaldson, Lufkin & Jenrette
Morgan Stanley Dean Witter
Credit Suisse First Boston
Lehman Brothers
Prudential Securities Inc.
Schroder & Co., Inc.
Underwriting for #12
Morgan Stanley Dean Witter
Credit Suisse First Boston
Merrill Lynch & Co.
Nationsbanc Montgomery Securities, Inc.
Salomon Smith Barney
William Blair & Company
Underwriting for #13
Goldman, Sachs & Co.
Morgan Stanley & Co., Inc.
Robert W. Baird & Co., Inc,
Bear, Stearns & Co., Inc.
Merrill Lynch, Inc.
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 11
<NAME> HARBOR CLASS A
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997<F1>
<PERIOD-START> JAN-01-1997<F1>
<PERIOD-END> DEC-31-1997<F1>
<INVESTMENTS-AT-COST> 410,734,666<F1>
<INVESTMENTS-AT-VALUE> 458,318,805<F1>
<RECEIVABLES> 12,324,941<F1>
<ASSETS-OTHER> 0<F1>
<OTHER-ITEMS-ASSETS> 47,091<F1>
<TOTAL-ASSETS> 470,690,837<F1>
<PAYABLE-FOR-SECURITIES> 2,235,030<F1>
<SENIOR-LONG-TERM-DEBT> 0<F1>
<OTHER-ITEMS-LIABILITIES> 6,121,112<F1>
<TOTAL-LIABILITIES> 8,356,142<F1>
<SENIOR-EQUITY> 0<F1>
<PAID-IN-CAPITAL-COMMON> 322,661,130
<SHARES-COMMON-STOCK> 24,997,425
<SHARES-COMMON-PRIOR> 24,783,565
<ACCUMULATED-NII-CURRENT> 1,807,183<F1>
<OVERDISTRIBUTION-NII> 0<F1>
<ACCUMULATED-NET-GAINS> 4,507,515<F1>
<OVERDISTRIBUTION-GAINS> 0<F1>
<ACCUM-APPREC-OR-DEPREC> 47,584,139<F1>
<NET-ASSETS> 376,442,973
<DIVIDEND-INCOME> 7,614,260<F1>
<INTEREST-INCOME> 13,976,440<F1>
<OTHER-INCOME> 0<F1>
<EXPENSES-NET> (5,527,490)<F1>
<NET-INVESTMENT-INCOME> 16,063,210<F1>
<REALIZED-GAINS-CURRENT> 54,691,941<F1>
<APPREC-INCREASE-CURRENT> 1,495,425<F1>
<NET-CHANGE-FROM-OPS> 72,250,576<F1>
<EQUALIZATION> 0<F1>
<DISTRIBUTIONS-OF-INCOME> (16,890,943)
<DISTRIBUTIONS-OF-GAINS> (39,111,920)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,596,353
<NUMBER-OF-SHARES-REDEEMED> (7,461,163)
<SHARES-REINVESTED> 3,078,670
<NET-CHANGE-IN-ASSETS> 3,343,894
<ACCUMULATED-NII-PRIOR> 1,590,591<F1>
<ACCUMULATED-GAINS-PRIOR> 2,071,254<F1>
<OVERDISTRIB-NII-PRIOR> 0<F1>
<OVERDIST-NET-GAINS-PRIOR> 0<F1>
<GROSS-ADVISORY-FEES> 2,510,215<F1>
<INTEREST-EXPENSE> 0<F1>
<GROSS-EXPENSE> 5,527,490<F1>
<AVERAGE-NET-ASSETS> 381,097,078
<PER-SHARE-NAV-BEGIN> 15.054
<PER-SHARE-NII> 0.600
<PER-SHARE-GAIN-APPREC> 1.854
<PER-SHARE-DIVIDEND> (0.730)
<PER-SHARE-DISTRIBUTIONS> (1.719)
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 15.059
<EXPENSE-RATIO> 1.04
<AVG-DEBT-OUTSTANDING> 0<F1>
<AVG-DEBT-PER-SHARE> 0<F1>
<FN>
<F1>This item relates to the Fund on a composite basis and not on a class basis
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 12
<NAME> HARBOR CLASS B
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997<F1>
<PERIOD-START> JAN-01-1997<F1>
<PERIOD-END> DEC-31-1997<F1>
<INVESTMENTS-AT-COST> 410,734,666<F1>
<INVESTMENTS-AT-VALUE> 458,318,805<F1>
<RECEIVABLES> 12,324,941<F1>
<ASSETS-OTHER> 0<F1>
<OTHER-ITEMS-ASSETS> 47,091<F1>
<TOTAL-ASSETS> 470,690,837<F1>
<PAYABLE-FOR-SECURITIES> 2,235,030<F1>
<SENIOR-LONG-TERM-DEBT> 0<F1>
<OTHER-ITEMS-LIABILITIES> 6,121,112<F1>
<TOTAL-LIABILITIES> 8,356,142<F1>
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 81,120,868
<SHARES-COMMON-STOCK> 5,426,072
<SHARES-COMMON-PRIOR> 5,264,665
<ACCUMULATED-NII-CURRENT> 1,807,183<F1>
<OVERDISTRIBUTION-NII> 0<F1>
<ACCUMULATED-NET-GAINS> 4,507,515<F1>
<OVERDISTRIBUTION-GAINS> 0<F1>
<ACCUM-APPREC-OR-DEPREC> 47,584,139<F1>
<NET-ASSETS> 81,289,568
<DIVIDEND-INCOME> 7,614,260<F1>
<INTEREST-INCOME> 13,976,440<F1>
<OTHER-INCOME> 0<F1>
<EXPENSES-NET> (5,527,490)<F1>
<NET-INVESTMENT-INCOME> 16,063,210<F1>
<REALIZED-GAINS-CURRENT> 54,691,941<F1>
<APPREC-INCREASE-CURRENT> 1,495,425<F1>
<NET-CHANGE-FROM-OPS> 72,250,576<F1>
<EQUALIZATION> 0<F1>
<DISTRIBUTIONS-OF-INCOME> (3,045,626)
<DISTRIBUTIONS-OF-GAINS> (8,428,584)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 702,695
<NUMBER-OF-SHARES-REDEEMED> (1,201,555)
<SHARES-REINVESTED> 660,267
<NET-CHANGE-IN-ASSETS> 2,362,351
<ACCUMULATED-NII-PRIOR> 1,590,591<F1>
<ACCUMULATED-GAINS-PRIOR> 2,071,254<F1>
<OVERDISTRIB-NII-PRIOR> 0<F1>
<OVERDIST-NET-GAINS-PRIOR> 0<F1>
<GROSS-ADVISORY-FEES> 2,510,215<F1>
<INTEREST-EXPENSE> 0<F1>
<GROSS-EXPENSE> 5,527,490<F1>
<AVERAGE-NET-ASSETS> 81,827,243
<PER-SHARE-NAV-BEGIN> 14.992
<PER-SHARE-NII> 0.470
<PER-SHARE-GAIN-APPREC> 1.848
<PER-SHARE-DIVIDEND> (0.610)
<PER-SHARE-DISTRIBUTIONS> (1.719)
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 14.981
<EXPENSE-RATIO> 1.82
<AVG-DEBT-OUTSTANDING> 0<F1>
<AVG-DEBT-PER-SHARE> 0<F1>
<FN>
<F1>This item relates to the Fund on a composite basis and not on a class basis
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 13
<NAME> HARBOR CLASS C
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997<F1>
<PERIOD-START> JAN-01-1997<F1>
<PERIOD-END> DEC-31-1997<F1>
<INVESTMENTS-AT-COST> 410,734,666<F1>
<INVESTMENTS-AT-VALUE> 458,318,805<F1>
<RECEIVABLES> 12,324,941<F1>
<ASSETS-OTHER> 0<F1>
<OTHER-ITEMS-ASSETS> 47,091<F1>
<TOTAL-ASSETS> 470,690,837<F1>
<PAYABLE-FOR-SECURITIES> 2,235,030<F1>
<SENIOR-LONG-TERM-DEBT> 0<F1>
<OTHER-ITEMS-LIABILITIES> 6,121,112<F1>
<TOTAL-LIABILITIES> 8,356,142<F1>
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,653,860
<SHARES-COMMON-STOCK> 305,181
<SHARES-COMMON-PRIOR> 236,225
<ACCUMULATED-NII-CURRENT> 1,807,183<F1>
<OVERDISTRIBUTION-NII> 0<F1>
<ACCUMULATED-NET-GAINS> 4,507,515<F1>
<OVERDISTRIBUTION-GAINS> 0<F1>
<ACCUM-APPREC-OR-DEPREC> 47,584,139<F1>
<NET-ASSETS> 4,602,154
<DIVIDEND-INCOME> 7,614,260<F1>
<INTEREST-INCOME> 13,976,440<F1>
<OTHER-INCOME> 0<F1>
<EXPENSES-NET> (5,527,490)<F1>
<NET-INVESTMENT-INCOME> 16,063,210<F1>
<REALIZED-GAINS-CURRENT> 54,691,941<F1>
<APPREC-INCREASE-CURRENT> 1,495,425<F1>
<NET-CHANGE-FROM-OPS> 72,250,576<F1>
<EQUALIZATION> 0<F1>
<DISTRIBUTIONS-OF-INCOME> (158,576)
<DISTRIBUTIONS-OF-GAINS> (466,649)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 95,609
<NUMBER-OF-SHARES-REDEEMED> (58,685)
<SHARES-REINVESTED> 32,032
<NET-CHANGE-IN-ASSETS> 1,040,091
<ACCUMULATED-NII-PRIOR> 1,590,591<F1>
<ACCUMULATED-GAINS-PRIOR> 2,071,254<F1>
<OVERDISTRIB-NII-PRIOR> 0<F1>
<OVERDIST-NET-GAINS-PRIOR> 0<F1>
<GROSS-ADVISORY-FEES> 2,510,215<F1>
<INTEREST-EXPENSE> 0<F1>
<GROSS-EXPENSE> 5,527,490<F1>
<AVERAGE-NET-ASSETS> 4,037,851
<PER-SHARE-NAV-BEGIN> 15.079
<PER-SHARE-NII> 0.448
<PER-SHARE-GAIN-APPREC> 1.882
<PER-SHARE-DIVIDEND> (0.610)
<PER-SHARE-DISTRIBUTIONS> (1.719)
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 15.080
<EXPENSE-RATIO> 1.82
<AVG-DEBT-OUTSTANDING> 0<F1>
<AVG-DEBT-PER-SHARE> 0<F1>
<FN>
<F1>This item relates to the Fund on a composite basis and not on a class basis
</FN>
</TABLE>
