<PAGE>
PAGE 1
1996 ANNUAL REPORT
IDS Progressive Fund
(prospectus enclosed)
(Icon of) Shooting star
The goal of IDS Progressive Fund, Inc. is long-term growth of
capital. The Fund invests primarily in undervalued common stocks.
(This annual report included a prospectus that describes in detail
the Fund's objective, investment policies, risks, sales charges,
fees and other matters of interest. Please read the prospectus
carefully before you invest or send money.)
AMERICAN
EXPRESS
Financial
Advisors
Distributed by American Express Financial Advisors Inc.
<PAGE>
PAGE 2
(Icon of ) Shooting star
The power of
patience
Everyone likes to get a bargain. In the investment world, bargains
are known as "value" stocks-stocks whose prices are believed to be
low in relation to the true worth of their respective companies.
In the case of Progressive Fund, the focus is on small-company
value stocks, which can get overlooked as investors try to find a
new "high-flier." Many of these companies have already proved
themselves in the marketplace and are financially sound. Patient
investors may benefit, however, when such stocks get rediscovered
and eventually rise to their fair values.
<PAGE>
PAGE 3
Contents
(Icon of) One open book inside of another.
The purpose of this annual report is to tell investors how the Fund
performed.
The prospectus, which is bound into the middle of this annual
report, describes the Fund in detail.
1996 annual report
From the president 4
From the portfolio manager 4
Ten largest holdings 6
Making the most of the Fund 7
Long-term performance 8
Independent auditors' report 9
Financial statements 10
Notes to financial statements 13
Investments in securities 22
IDS mutual funds 26
Federal income tax information 30
1996 prospectus
The Fund in brief 3p
Goal 3p
Investment policies and risks 3p
Manager and distributor 3p
Portfolio manager 3p
Alternative purchase arrangements 3p
Sales charge and Fund expenses 4p
Performance 6p
Financial highlights 6p
Total returns 8p
Investment policies and risks 10p
Facts about investments and their risks 11p
Alternative investment option 17p
Valuing Fund shares 17p
How to purchase, exchange or redeem shares 18p
Alternative purchase arrangements 18p
How to purchase shares 21p
How to exchange shares 24p
How to redeem shares 25p
Reductions and waivers of the sales charge 30p
Special shareholder services 35p
Services 35p
Quick telephone reference 35p
<PAGE>
PAGE 4
Distributions and taxes 36p
Dividend and capital gain distributions 36p
Reinvestments 37p
Taxes 38p
How to determine the correct TIN 40p
How the Fund is organized 41p
Shares 41p
Voting rights 41p
Shareholder meetings 41p
Board members and officers 41p
Investment manager 43p
Administrator and transfer agent 43p
Distributor 44p
About American Express Financial Corporation 46p
General information 46p
Appendix 47p
Descriptions of derivative instruments 47p
<PAGE>
PAGE 5
To our shareholders
(Photo of) William R. Pearce, President of the Fund
(Photo of) Mike Garbisch, Portfolio manager
From the president
The volatility in the stock market in recent months has put some
investors, even experienced ones, on edge. Although no one can
know exactly what will happen next, history tells us that ups and
downs are intrinsic to stock investing.
But, history also shows that changing strategies with every twist
and turn of the market is an impractical and, worse yet, typically
unproductive way to invest. What matters more, therefore, is how
we react to market volatility. If we take a long-term view and
accept the downs with the ups, we improve our chances of success.
For in the investment world, the race most often goes not to the
swift, but to the persistent.
Along the way, of course, you'll still want to review your
investment program to make sure it's on track to achieving your
financial goals. Your American Express financial advisor will help
you do just that, and I suggest you take advantage of his or her
services on a regular basis.
William R. Pearce
From the portfolio manager
IDS Progressive Fund generated a total return on Class A shares of
14.4% during the past fiscal year (October 1995 through September
1996), as the stock market marched into record territory. (Part of
the Fund's return came in the form of a capital gain paid to
shareholders in December 1995, which reduced the Fund's net asset
value by a like amount at that time.)
The market mounted a strong advance early in the period, as healthy
corporate profits, moderate economic growth, low inflation and,
until last February, declining long-term interest rates provided a
solid underpinning for higher stock prices.
Volatility increases
By March, though, concern about the possibility of a too-strong
economy causing a run-up in inflation had set in. That concern
kept the market off balance until July, when it finally stumbled.
But, displaying the remarkable resilience that has been its
hallmark in recent years, the market quickly regrouped for an
August-September rally as worries about an interest-rate hike by
the Federal Reserve abated.
Although Fund performance was pretty consistent during the 12
months (nine of them showed a positive return), its emphasis on
small-capitalization value stocks usually took a back seat to the
large-capitalization growth-stock group, especially the
<PAGE>
PAGE 6
periodically high-flying technology issues. Still, the Fund
enjoyed good results from stocks in less-glamorous groups such as
autos, insurance, industrial machinery and office furniture. A
decision last spring to reduce cash reserves also benefited
performance over the final half of the period.
The most notable change to the portfolio, however, was a
substantial increase among technology holdings, particularly those
with a cyclical nature. While this group did little to enhance
Fund performance during the past period, I expect it to make a
greater contribution when technology stocks, which have been under
pressure from rising inventories in the semiconductor segment, pick
up more momentum. This could come as early as the first quarter of
1997.
Fundamentals still O.K.
As we enter a new fiscal year, it appears that the stock market
still has some important things going for it. At this writing
(early October), inflation remains well-behaved; the economy
continues to be growing at a reasonably good pace; and long-term
interest rates show no signs of rising markedly.
On the potentially negative side, stocks have enjoyed a lengthy,
positive run and investor optimism could hardly be higher. In the
sometimes contrary world of investing, this could in fact, make the
market vulnerable to possible bad news. Should we experience a
less-than-perfect investment environment in the months ahead, I
think the value orientation of the portfolio will serve the Fund
well while still allowing it to share in the market's more
prosperous periods.
Mike Garbisch
Class A
12-month performance
(All figures per share)
Net asset value (NAV)
____________________________
Sept. 30, 1996 $ 8.23
____________________________
Sept. 30, 1995 $ 7.66
____________________________
Increase $ 0.57
____________________________
<PAGE>
PAGE 7
Distributions
Oct. 1, 1995 - Sept 30, 1996
____________________________
From income $ 0.20
____________________________
From capital gains $ 0.28
____________________________
Total distributions $ 0.48
____________________________
Total return* +14.4%**
____________________________
Class B
12-month performance
(All figures per share)
Net asset value (NAV)
____________________________
Sept. 30, 1996 $ 8.15
____________________________
Sept. 30, 1995 $ 7.63
____________________________
Increase $ 0.52
____________________________
Distributions
Oct. 1, 1995 - Sept. 30, 1996
____________________________
From income $ 0.18
____________________________
From capital gains $ 0.28
____________________________
Total distributions $ 0.46
____________________________
Total return* +13.5%**
____________________________
Class Y
12-month performance
(All figures per share)
Net asset value (NAV)
____________________________
Sept 30, 1996 $ 8.24
____________________________
Sept. 30, 1995 $ 7.67
____________________________
Increase $ 0.57
____________________________
<PAGE>
PAGE 8
Distributions
Oct. 1, 1995 - Sept 30, 1996
____________________________
From income $ 0.21
____________________________
From capital gains $ 0.28
____________________________
Total distributions $ 0.49
____________________________
Total return* +14.6%**
____________________________
*The prospectus discusses the effect of
sales charges, if any, on the various classes.
**The total return is a hypothetical investment
in the Fund with all distributions reinvested.
<PAGE>
PAGE 9
<TABLE>
<CAPTION>
The Fund's ten largest holdings
IDS Progressive Fund
(Pie chart) The ten holdings listed here make up 18.46% of the Fund's net assets
Percent Value
(of Fund's net assets)(as of Sept. 30, 1996)
<S> <C> <C>
ALLIED Group 2.24% $8,855,000
A holding company that provides property-casualty
insurance, excess and surplus insurance,
investment services and data-processing services.
Lancaster Colony 2.17 8,606,250
Manufactures and markets specialty foods, automotive
products, glassware and candles.
Harland (John H.) 1.90 7,500,000
One of the nation's leading providers of checks,
forms and business documents to financial
institutions, consumers, brokerage firms and
financial software companies.
Century Telephone 1.82 7,218,750
A regional diversified telecommunications company
primarily engaged in providing traditional and
cellular telephone services.
Terra Nova Holdings 1.81 7,175,000
A holding company that, through its subsidiaries,
is a specialty, casualty and marine insurance and
reinsurance company.
First Virginia Banks 1.78 7,047,000
A registered bank holding company that owns and
operates 274 commercial banks throughout
Virginia, Maryland and Tennessee.
Belden 1.76 6,960,000
Designs, manufactures and markets wire, cable
and cord products for the electronics and electrical
allocations.
Horace Mann Educators 1.66 6,575,000
An insurance holding company that, through its
subsidiaries, is engaged in marketing and
underwriting personal lines of property and
casualty and life insurance and retirement annuities.
Production Operators 1.66 6,570,000
Specializes in the handling of gases for maximizing
the recovery of hydrocarbon resources.
Rayonier 1.66 6,558,750
A leading international forest products company
primarily engaged in the trading, merchandising and
manufacturing of logs, timber and wood products and
in the production and sale of high-value-added
specialty pulps.
</TABLE>
<PAGE>
PAGE 10
Making the most of the Fund
Average annual total return
(as of Sept. 30, 1996)
1 year Since inception 5 years 10 years
Class A + 8.67% --% +12.21% + 9.37%
Class B* + 8.51% +13.76% --% --%
Class Y* +14.56% +17.29% --% --%
*Inception date was March 20, 1995.
The performance of Class B and Class Y will vary from the
performance of Class A based on differences in sales charges and
fees.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
Figures for Class A reflect the effect of the maximum 5% sales
charge and figures for Class B reflect the applicable contingent
deferred sales charge. This was a period of widely fluctuating
security prices. Past performance is no guarantee of future
results.
Build your assets systematically
One of the best ways to invest in the Fund is by dollar-cost
averaging -- a time-tested strategy that can make market
fluctuations work for you. To dollar-cost average, simply invest a
fixed amount of money regularly. You'll automatically buy more
shares when the Fund's share price is low, fewer shares when it is
high.
This does not ensure a profit or avoid a loss if the market
declines. But, if you can continue to invest regularly through
changing market conditions, it can be an effective way to
accumulate shares to meet your long-term goals.
How dollar-cost averaging works
Month Amount Per-share Number of shares purchased
invested market price
Jan $100 $20 5.00 XXXXX
Feb 100 18 5.56 XXXXXx
March 100 17 5.88 XXXXXx
April 100 15 6.67 XXXXXXx
May 100 16 6.25 XXXXXXx
June 100 18 5.56 XXXXXx
July 100 17 5.88 XXXXXx
Aug 100 19 5.26 XXXXXx
Sept 100 21 4.76 XXXXx
Oct 100 20 5.00 XXXXX
(footnotes to table) By investing an equal number of dollars each
month...
<PAGE>
PAGE 11
(arrow in table pointing to April) you automatically buy more
shares when the per share market price is low...
(arrow in table pointing to September) and fewer shares when the
per share market price is high.
You have paid an average price of only $17.91 per share over the 10
months, while the average market price actually was $18.10.
<PAGE>
PAGE 12
The Fund's long-term performance
Three ways to benefit from a mutual fund:
o your shares increase in value when the Fund's investments do
well
o you receive capital gains when the gains on investments sold
by the Fund exceed losses
o you receive income when the Fund's stock dividends, interest
and short-term gains exceed its expenses.
All three make up your total return. And you potentially can
increase your investment if, like most investors, you reinvest your
dividends and capital gain distributions to buy additional shares
of the Fund or another fund.
How your $10,000 has grown in IDS Progressive Fund
$30,000 S&P 500
Stock Index
$24,488
$20,000 Lipper Capital Progressive
Appreciation Fund Fund
Class A
$9,500
'86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96
Average annual total return
(as of Sept 30, 1996)
1 year Since inception 5 years 10 years
Class A + 8.67% --% +12.21% + 9.37%
Class B* + 8.51% +13.76% --% --%
Class Y* +14.56% +17.29% --% --%
*Inception date was March 20, 1995.
Assumes: Holding period from 10/1/86 to 9/30/96. Returns do not
reflect taxes payable on distributions. Reinvestment of all income
and capital gain distributions for the Fund, with a value of
$12,823. Also see "Performance" in the Fund's current prospectus.
Standard & Poor's 500 Stock Index (S&P 500), an unmanaged list of
common stocks, is frequently used as a general measure of market
performance. However, the S&P 500 companies are generally larger
than those in which the Fund invests.
<PAGE>
PAGE 13
Lipper Capital Appreciation Fund Index, published by Lipper
Analytical Services, Inc., includes 30 funds that are generally
similar to this Fund, although some funds in the index may have
somewhat different investment policies or objectives.
On the graph above you can see how the Fund's total return compared
to two widely cited performance indexes, the S&P 500 and the Lipper
Capital Appreciation Fund Index. In comparing Progressive Fund to
the two indexes, you should take into account the fact that the
Fund's performance reflects the maximum sales charge of 5%, while
such charges are not reflected in the performance of the indexes.
If you were actually to buy individual stocks or growth mutual
funds, any sales charges that you pay would reduce your total
return as well.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
This was a period of widely fluctuating security prices. Past
performance is no guarantee of future results.
<PAGE>
PAGE 14
Independent auditors' report
The board and shareholders
IDS Progressive Fund, Inc.:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments in securities,
of IDS Progressive Fund, Inc. as of September 30, 1996, and the
related statement of operations for the year then ended and the
statements of changes in net assets for each of the years in the
two-year period ended September 30, 1996, and the financial
highlights for each of the years in the ten-year period ended
September 30, 1996. These financial statements and the financial
highlights are the responsibility of fund management. Our
responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements and the financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. Investment securities held in custody are
confirmed to us by the custodian. As to securities purchased and
sold but not received or delivered, and securities on loan, we
request confirmations from brokers, and where replies are not
received, we carry out other appropriate auditing procedures. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of IDS
Progressive Fund, Inc. at September 30, 1996, and the results of
its operations for the year then ended and the changes in its net
assets for each of the years in the two-year period ended September
30, 1996, and the financial highlights for the periods stated in
the first paragraph above, in conformity with generally accepted
accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
November 1, 1996
<PAGE>
PAGE 15
<TABLE>
<CAPTION>
Statement of assets and liabilities
IDS Progressive Fund, Inc.
Sept. 30, 1996
Assets
____________________________________________________________________________________
<S> <C>
Investments in securities, at value (Note 1)
(identified cost $351,163,181) $405,055,958
Cash in bank on demand deposit 146,324
Dividends and accrued interest receivable 789,507
Receivable for investment securities sold 1,405,098
____________________________________________________________________________________
Total assets 407,396,887
____________________________________________________________________________________
Liabilities
____________________________________________________________________________________
Payable for investment securities purchased 2,793,591
Payable upon return of securities loaned (Note 4) 8,710,000
Accrued investment management services fee 20,365
Accrued distribution fee 1,499
Accrued service fee 5,603
Accrued transfer agency fee 5,100
Accrued administrative services fee 1,878
Other accrued expenses 62,275
____________________________________________________________________________________
Total liabilities 11,600,311
____________________________________________________________________________________
Net assets applicable to outstanding capital stock $395,796,576
____________________________________________________________________________________
Represented by
____________________________________________________________________________________
Capital stock -- authorized 10,000,000,000 shares of $.01 par value $ 481,274
Additional paid-in capital 309,949,345
Undistributed net investment income 3,202,477
Accumulated net realized gain (Note 1) 28,267,094
Unrealized appreciation of investments and on translation
of assets and liabilities in foreign currencies 53,896,386
____________________________________________________________________________________
Total -- representing net assets applicable to outstanding capital stock $395,796,576
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
__________________________________________________________________________________________________________
Net assets applicable to outstanding shares: Class A $367,834,646
Class B $ 24,701,726
Class Y $ 3,260,204
Net asset value per share of outstanding capital stock: Class A shares 44,700,759 $ 8.23
Class B shares 3,031,068 $ 8.15
Class Y shares 395,622 $ 8.24
See accompanying notes to financial statements.
/TABLE
<PAGE>
PAGE 16
<TABLE>
<CAPTION>
Statement of operations
IDS Progressive Fund, Inc.
Year ended Sept. 30, 1996
______________________________________________________________________________________________________________
Investment income
______________________________________________________________________________________________________________
<S> <C>
Income:
Dividends (net of foreign taxes withheld of $89,124) $ 5,788,683
Interest 2,488,367
______________________________________________________________________________________________________________
Total income 8,277,050
______________________________________________________________________________________________________________
Expenses (Note 2):
Investment management services fee 2,135,854
Distribution fee -- Class B 114,875
Transfer agency fee 615,418
Incremental transfer agency fee -- Class B 2,687
Service fee
Class A 601,356
Class B 26,759
Administrative services fee 215,318
Compensation of board members 2,071
Compensation of officers 3,316
Custodian fees 53,883
Postage 32,619
Registration fees 65,228
Reports to shareholders 39,185
Audit fees 24,000
Administrative 2,785
Other 8,045
______________________________________________________________________________________________________________
Total expenses 3,943,399
Earnings credits on cash balances (Note 2) (2,464)
______________________________________________________________________________________________________________
Total net expenses 3,940,935
______________________________________________________________________________________________________________
Investment income -- net 4,336,115
______________________________________________________________________________________________________________
Realized and unrealized gain -- net
______________________________________________________________________________________________________________
Net realized gain on security and foreign currency transactions
(including gain of $140,313 from foreign currency transactions) (Note 3) 28,404,561
Net change in unrealized appreciation or depreciation of investments and on
translation of assets and liabilities in foreign currencies 16,970,511
______________________________________________________________________________________________________________
Net gain on investments and foreign currencies 45,375,072
______________________________________________________________________________________________________________
Net increase in net assets resulting from operations $49,711,187
See accompanying notes to financial statements.
/TABLE
<PAGE>
PAGE 17
<TABLE>
<CAPTION>
Statements of changes in net assets
IDS Progressive Fund, Inc.
Year ended Sept. 30,
<S> <C> <C>
Operations and distributions 1996 1995
______________________________________________________________________________________________________________
Investment income -- net $ 4,336,115 $ 5,548,736
Net realized gain on investments and foreign currencies 28,404,561 16,098,282
Net change in unrealized appreciation or depreciation of investments
and on translation of assets and liabilities in foreign currencies 16,970,511 29,110,171
______________________________________________________________________________________________________________
Net increase in net assets resulting from operations 49,711,187 50,757,189
______________________________________________________________________________________________________________
Distributions to shareholders from:
Net investment income
Class A (5,559,877) (5,046,235)
Class B (152,829) --
Class Y (19,834) --
Net realized gain
Class A (15,575,830) (12,036,462)
Class B (495,315) --
Class Y (51,524) --
______________________________________________________________________________________________________________
Total distributions (21,855,209) (17,082,697)
______________________________________________________________________________________________________________
Capital share transactions (Note 5)
______________________________________________________________________________________________________________
Proceeds from sales
Class A shares (Note 2) 39,648,057 51,297,752
Class B shares 17,231,778 7,175,301
Class Y shares 2,550,315 1,700,674
Reinvestment of distributions at net asset value
Class A shares 20,738,354 16,744,777
Class B shares 644,113 --
Class Y shares 71,358 --
Payments for redemptions
Class A shares (55,284,721) (41,167,059)
Class B shares (Note 2) (2,019,169) (127,637)
Class Y shares (1,410,053) (27,749)
______________________________________________________________________________________________________________
Increase in net assets from capital share transactions 22,170,032 35,596,059
______________________________________________________________________________________________________________
Total increase in net assets 50,026,010 69,270,551
Net assets at beginning of year 345,770,566 276,500,015
______________________________________________________________________________________________________________
Net assets at end of year
(including undistributed net investment
income of $3,202,477 and $4,462,680) $395,796,576 $345,770,566
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 18
IDS Progressive Fund, Inc.
___________________________________________________________________
1. Summary of significant accounting policies
The Fund is registered under the Investment Company Act of 1940 (as
amended) as a diversified, open-end management investment company.
The Fund invests primarily in undervalued common stocks. The Fund
offers Class A, Class B and Class Y shares. Class A shares are sold
with a front-end sales charge. Class B shares may be subject to a
contingent deferred sales charge and such shares automatically
convert to Class A after eight years. Class Y shares have no sales
charge and are offered only to qualifying institutional investors.
All classes of shares have identical voting, dividend, liquidation
and other rights, and the same terms and conditions, except that
the level of distribution fee, transfer agency fee and service fee
(class specific expenses) differs among classes. Income, expenses
(other than class specific expenses) and realized and unrealized
gains or losses on investments are allocated to each class of
shares based upon its relative net assets.
Significant accounting policies followed by the Fund are summarized
below:
Use of estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from
operations during the period. Actual results could differ from
those estimates.
Valuation of securities
All securities are valued at the close of each business day.
Securities traded on national securities exchanges or included in
national market systems are valued at the last quoted sales price;
securities for which market quotations are not readily available,
including illiquid securities, are valued at fair value according
to methods selected in good faith by the board. Determination of
fair value involves, among other things, reference to market
indexes, matrixes and data from independent brokers. Short-term
securities maturing in more than 60 days from the valuation date
are valued at the market price or approximate market value based on
current interest rates; those maturing in 60 days or less are
valued at amortized cost.
Option transactions
In order to produce incremental earnings, protect gains, and
facilitate buying and selling of securities for investment
purposes, the Fund may buy or write options traded on any U.S. or
<PAGE>
PAGE 19
foreign exchange or in the over-the-counter market where the
completion of the obligation is dependent upon the credit standing
of the other party. The Fund also may buy or sell put and call
options and write covered call options on portfolio securities and
may write cash-secured put options. The risk in writing a call
option is that the Fund gives up the opportunity of profit if the
market price of the security increases. The risk in writing a put
option is that the Fund may incur a loss if the market price of the
security decreases and the option is exercised. The risk in buying
an option is that the Fund pays a premium whether or not the option
is exercised. The Fund also has the additional risk of not being
able to enter into a closing transaction if a liquid secondary
market does not exist.
Option contracts are valued daily at the closing prices on their
primary exchanges and unrealized appreciation or depreciation is
recorded. The Fund will realize a gain or loss upon expiration or
closing of the option transaction. When an option is exercised, the
proceeds on sales for a written call option, the purchase cost for
a written put option or the cost of a security for a purchased put
or call option is adjusted by the amount of premium received or
paid.
Futures transactions
In order to gain exposure to or protect itself from changes in the
market, the Fund may buy and sell stock index or interest rate
futures contracts traded on any U.S. or foreign exchange. The Fund
also may buy or write put and call options on these futures
contracts. Risks of entering into futures contracts and related
options include the possibility that there may be an illiquid
market and that a change in the value of the contract or option may
not correlate with changes in the value of the underlying
securities.
Upon entering into a futures contract, the Fund is required to
deposit either cash or securities in an amount (initial margin)
equal to a certain percentage of the contract value. Subsequent
payments (variation margin) are made or received by the Fund each
day. The variation margin payments are equal to the daily changes
in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the
contract is closed or expires.
<PAGE>
PAGE 20
Foreign currency translations and foreign currency contracts
Securities and other assets and liabilities denominated in foreign
currencies are translated daily into U.S. dollars at the closing
rate of exchange. Foreign currency amounts related to the purchase
or sale of securities and income and expenses are translated at the
exchange rate on the transaction date. The effect of changes in
foreign exchange rates on realized and unrealized security gains or
losses is reflected as a component of such gains or losses. In the
statement of operations, net realized gains or losses from foreign
currency transactions may arise from sales of foreign currency,
closed forward contracts, exchange gains or losses realized between
the trade date and settlement dates on securities transactions, and
other translation gains or losses on dividends, interest income and
foreign withholding taxes.
The Fund may enter into forward foreign currency exchange contracts
for operational purposes and to protect against adverse exchange
rate fluctuation. The net U.S. dollar value of foreign currency
underlying all contractual commitments held by the Fund and the
resulting unrealized appreciation or depreciation are determined
using foreign currency exchange rates from an independent pricing
service. The Fund is subject to the credit risk that the other
party will not complete the obligations of the contract.
<PAGE>
PAGE 21
Federal taxes
Since the Fund's policy is to comply with all sections of the
Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income to shareholders, no
provision for income or excise taxes is required.
Net investment income (loss) and net realized gains (losses) may
differ for financial statement and tax purposes primarily because
of the deferral of losses on certain futures contracts, the
recognition of certain foreign currency gains (losses) as ordinary
income (loss) for tax purposes and losses deferred due to "wash
sale" transactions. The character of distributions made during the
year from net investment income or net realized gains may differ
from their ultimate characterization for federal income tax
purposes. The effect on dividend distributions of certain
book-to-tax differences is presented as "excess distributions"
in the statement of changes in net assets. Also, due to the timing
of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized
gains (losses) were recorded by the Fund.
On the statement of assets and liabilities, as a result of
permanent book-to-tax differences, undistributed net investment
income has been increased by $136,222 and accumulated net realized
gain has been decreased by $136,222.
Dividends to shareholders
An annual dividend declared and paid at the end of the calendar
year from net investment income is reinvested in additional shares
of the Fund at net asset value or payable in cash. Capital gains,
when available, are distributed along with the income dividend.
Other
Security transactions are accounted for on the date securities are
purchased or sold. Dividend income is recognized on the ex-dividend
date and interest income, including level-yield amortization of
premium and discount, is accrued daily.
<PAGE>
PAGE 22
___________________________________________________________________
2. Expenses and sales charges
Effective March 20, 1995, the Fund entered into agreements with
American Express Financial Corporation (AEFC) for managing its
portfolio, providing administrative services and serving as
transfer agent. Under its Investment Management Services Agreement,
AEFC determines which securities will be purchased, held or sold.
The management fee is a percentage of the Fund's average daily net
assets in reducing percentages from 0.64% to 0.515% annually. The
fee is adjusted upward or downward by a performance incentive
adjustment based on the Fund's average daily net assets over a
rolling twelve-month period as measured against the change in the
Lipper Capital Appreciation Fund Index. The maximum adjustment is
0.12% of the Fund's average daily net assets after deducting 1%
from the performance difference. If the performance difference is
less than 1%, the adjustment will be zero. The adjustment decreased
the fee by $194,255 for the year ended Sept. 30, 1996.
Under an Administrative Services Agreement, the Fund pays AEFC for
administration and accounting services at a percentage of the
Fund's average daily net assets in reducing percentages from 0.06%
to 0.035% annually.
Under a separate Transfer Agency Agreement, AEFC maintains
shareholder accounts and records. The Fund pays AEFC an annual fee
per shareholder account for this service as follows:
Class A $15
Class B $16
Class Y $15
Also effective March 20, 1995, the Fund entered into agreements
with American Express Financial Advisors Inc. for distribution and
shareholder servicing-related services. Under a Plan and Agreement
of Distribution, the Fund pays a distribution fee at an annual rate
of 0.75% of the Fund's average daily net assets attributable to
Class B shares for distribution- related services.
Under a Shareholder Service Agreement, the Fund pays a fee for
service provided to shareholders by financial advisors and other
servicing agents. The fee is calculated at a rate of 0.175% of the
Fund's average daily net assets attributable to Class A and Class B
shares.
AEFC will assume and pay any expenses (except taxes and brokerage
commissions) that exceed the most restrictive applicable state
expense limitation.
Sales charges received by American Express Financial Advisors Inc.
for distributing Fund shares were $654,405 for Class A and $7,797
for Class B for the year ended Sept. 30, 1996. The Fund also pays
custodian fees to American Express Trust Company, an affiliate of
AEFC.
<PAGE>
PAGE 23
During the year ended Sept. 30, 1996, the Fund's custodian and
transfer agency fees were reduced by $2,464 as a result of earnings
credits from overnight cash balances.
Prior to April 30, 1996, the Fund had a retirement plan for its
independent board members. The plan was terminated April 30, 1996.
The retirement plan expense amounted to $3,011 for the period. The
total liability for the plan is $12,566, which will be paid out at
some future date.
___________________________________________________________________
3. Securities transactions
Cost of purchases and proceeds from sales of securities (other than
short-term obligations) aggregated $223,085,112 and $188,372,182,
respectively, for the year ended Sept. 30, 1996. Realized gains and
losses are determined on an identified cost basis.
Brokerage commissions paid to brokers affiliated with AEFC were
$28,606 for the year ended Sept. 30, 1996.
___________________________________________________________________
4. Lending of portfolio securities
At Sept. 30, 1996, securities valued at $8,165,000 were on loan to
brokers. For collateral, the Fund received $8,710,000 in cash.
Income from securities lending amounted to $40,328 for the year
ended Sept. 30, 1996. The risks to the Fund of securities lending
are that the borrower may not provide additional collateral when
required or return the securities when due.
___________________________________________________________________
5. Capital share transactions
Transactions in shares of capital stock for the years indicated are
as follows:
<TABLE><CAPTION>
Year ended Sept. 30, 1996
<S> <C> <C> <C>
Class A Class B Class Y
_____________________________________________________________________________
Sold 5,118,893 2,232,425 332,283
Issued for reinvested 2,788,167 86,937 9,593
distributions
Redeemed (7,139,474) (261,613) (184,442)
_____________________________________________________________________________
Net increase 767,586 2,057,749 157,434
_____________________________________________________________________________
Year ended Sept. 30, 1995
Class A Class B* Class Y*
_____________________________________________________________________________
Sold 7,377,210 990,962 241,975
Issued for reinvested 2,586,065 -- --
distributions
Redeemed (5,882,611) (17,643) (3,787)
________________________________________________________________________________
Net increase 4,080,664 973,319 238,188
_______________________________________________________________________________
*Inception date was March 20, 1995
</TABLE>
<PAGE>
PAGE 24
___________________________________________________________________
6. Illiquid securities
At Sept. 30, 1996, investments in securities included issues that
are illiquid. The Fund currently limits investments in illiquid
securities to 10% of the Fund's net assets, at market value, at the
time of purchase. The aggregate value of such securities at Sept.
30, 1996 was $5,939,345 representing 1.5% of net assets. Pursuant
to guidelines adopted by the Fund's board, certain unregistered
securities are determined to be liquid and are not included within
the 10% limitation specified above.
___________________________________________________________________
7. Financial highlights
"Financial highlights" showing per share data and selected ratio
information is presented on pages 6 and 7 of the prospectus.<PAGE>
PAGE 25
<TABLE>
<CAPTION>
Investments in securities
IDS Progressive Fund, Inc. (Percentages represent value of
Sept. 30, 1996 investments compared to net assets)
Common stocks (91.6%)
<S> <C> <C>
Issuer Shares Value(a)
Aerospace & defense (0.5%)
Rohr 100,000(b) $1,962,500
Automotive & related (4.0%)
Danaher 150,000 6,206,250
Dura Automotive Systems 211,500(b) 3,939,188
Tower Automotive 225,000(b) 5,765,625
Total 15,911,063
Banks and savings & loans (5.1%)
F & M Bancorp 45,810 1,420,110
First Virginia Banks 162,000 7,047,000
Roosevelt Financial 325,000 5,565,625
TCF Financial 165,000 6,208,125
Total 20,240,860
Building materials & construction (3.1%)
Cameron Ashley 250,000(b) 3,156,250
Juno Lighting 205,000 3,408,125
Martin Marietta Materials 260,700(c) 5,572,462
Total 12,136,837
Chemicals (1.6%)
Ecolab 188,000 6,345,000
Computers & office equipment (6.0%)
Diebold 73,000 4,261,375
Exabyte 310,000(b) 4,650,000
Intl Imaging Materials 257,500(b) 5,632,813
Softkey Intl 260,000(b) 5,037,500
Solectron 85,000(b) 4,165,000
Total 23,746,688
Electronics (4.3%)
Channell Commercial 179,500(b) 2,243,750
ITI Technologies 75,000(b) 2,643,750
Lattice Semiconductor 175,000(b) 5,053,125
MEMC Electronic Materials 110,000(b) 2,543,750
Pioneer Standard Electronics 400,000 4,500,000
Total 16,984,375
Energy (1.2%)
Murphy Oil 100,000 4,825,000
Energy equipment & services (1.7%)
Production Operators 180,000 6,570,000
Financial services (4.9%)
ADVANTA Cl B 140,000 5,985,000
Phoenix Duff & Phelps 600,000 3,750,000
Simon DeBartolo Group REIT 180,000 4,590,000
Sun Communities REIT 180,000 5,130,000
Total 19,455,000
See accompanying notes to investments in securities.
<PAGE>
PAGE 26
Furniture & appliances (1.5%)
Miller (Herman) 150,000 6,075,000
Health care (4.4%)
Beckman Instruments 125,000 4,859,375
Boston Scientific 110,000(b) 6,325,000
Life Technologies 88,350 1,987,875
Tecnol Medical Products 300,000(b) 4,312,500
Total 17,484,750
Health care services (2.6%)
Living Centers of America 220,000(b) 5,500,000
United Wisconsin Services 167,600 4,902,300
Total 10,402,300
Household products (1.7%)
Libbey 159,400 4,204,175
Stanhome 86,600 2,500,575
Total 6,704,750
Industrial equipment & services (7.6%)
Alamo Group 220,000 3,217,500
AMETEK 56,800 1,072,100
Belden 240,000 6,960,000
General Signal 110,000 4,840,000
Hubbell Cl B 120,000 4,440,000
Kaydon 120,000 5,160,000
Regal Beloit 250,000 4,156,250
Total 29,845,850
Insurance (8.6%)
ALLIED Group 230,000 8,855,000
Executive Risk 129,900 5,001,150
Horace Mann Educators 200,000 6,575,000
PennCorp Financial Group 200,000 6,450,000
Terra Nova Holdings 350,000 7,175,000
Total 34,056,150
Leisure time & entertainment (1.0%)
Station Casinos 330,000(b) 3,960,000
Media (2.3%)
Harland (John H) 250,000 7,500,000
Valassis Communications 106,900(b) 1,670,312
Total 9,170,312
Multi-industry conglomerates (5.6%)
Brady (WH) 57,500 1,444,688
Griffon 600,000(b) 5,925,000
Lancaster Colony 225,000 8,606,250
Standex Intl 54,500 1,635,000
Zero Corp 250,000 4,750,000
Total 22,360,938
Paper & packaging (2.9%)
Longview Fibre 300,000 4,725,000
Rayonier 165,000 6,558,750
Total 11,283,750
Restaurants & lodging (2.5%)
Brinker Intl 265,000(b) 4,505,000
Buffets 500,000(b) 5,250,000
Total 9,755,000
Retail (2.9%)
Department 56 200,000(b) 4,975,000
Lands' End 300,000(b) 6,450,000
Total 11,425,000
<PAGE>
PAGE 27
Utilities -- electric (2.1%)
LG&E Energy 180,000 4,005,000
Sierra Pacific Resources 160,000 4,140,000
Total 8,145,000
Utilities -- gas (1.1%)
New Jersey Resources 153,900 4,309,200
Utilities -- telephone (1.8%)
Century Telephone 210,000 7,218,750
Foreign (10.6%)(d)
Concordia Paper Holdings 90,000(b) 427,500
DeBeers Consolidated Mines ADR 200,000 6,200,000
Elsag Bailey Process Auto 95,000(b) 2,030,625
Empresas ICA Sociedad ADR 200,000(b,c) 3,050,000
Fomento de Construcciones 22,000 1,738,758
Greencore Group 400,000 2,253,816
Kondor Wessels 58,000 2,073,364
Kwik-Fit Holdings 660,000 2,350,073
Leigh Interests 1,200,000 2,328,943
Powerscreen Intl 600,000 5,160,299
Renaissance Energy 123,000(b) 3,608,216
Renaissance Energy 27,000(b,f) 792,047
Schibsted Group 130,000(f) 1,898,598
South China Morning Post 3,000,000 2,230,698
Tempest Reinsurance 30,000(b,e) 5,939,345
Total 42,082,282
Total common stocks
(Cost: $308,641,366) $362,456,355
</TABLE>
<TABLE>
<CAPTION>
Bond (1.0%)
<S> <C> <C> <C> <C>
Issuer Coupon Maturity Principal Value(a)
rate year amount
Foreign (1.0%)(d)
Eskom
(South African Rand) 11.00% 2008 $23,550,000 $4,006,143
Total bond
(Cost: $3,928,355) $4,006,143
</TABLE>
<TABLE>
<CAPTION>
Short-term securities (9.7%)
<S> <C> <C> <C>
Issuer Annualized Amount Value(a)
yield on payable at
date of maturity
purchase
U.S. government agency (1.3%)
Federal Home Loan Mtge Corp
Disc Nts
10-10-96 5.30% $ 400,000 $ 399,472
10-23-96 5.37 5,000,000 4,983,653
Total 5,383,125
Commercial paper (8.4%)
BBV Finance Delaware
10-25-96 5.38 3,500,000 3,487,493
CAFCO
10-10-96 5.30 1,900,000 1,897,497
Ciesco LP
10-01-96 5.46 1,400,000 1,400,000
Fleet Funding
10-10-96 5.37 2,300,000(g) 2,296,924
10-17-96 5.38 600,000(g) 598,573
<PAGE>
PAGE 28
Metlife Funding
10-09-96 5.30 600,000 599,297
10-21-96 5.35 2,500,000 2,492,611
Reed Elsevier
10-24-96 5.39 3,500,000(g) 3,487,992
St. Paul Companies
10-17-96 5.37 2,800,000(g) 2,793,342
Sandoz
10-23-96 5.38 4,400,000(g) 4,385,588
Southwestern Bell Capital
10-04-96 5.37 3,000,000(g) 2,998,662
Toyota Motor Credit
10-15-96 5.37 800,000 798,336
Transamerica Finance
10-28-96 5.42 2,400,000 2,390,280
10-31-96 5.45 3,600,000 3,583,740
Total 33,210,335
Total short-term securities
(Cost: $38,593,460) $ 38,593,460
Total investment in securities
(Cost: $351,163,181)(h) $ 405,055,958
</TABLE>
<TABLE>
<CAPTION>
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial statements.
(b) Non-income producing.
(c) Security is partially or fully on loan. See Note 4 to the financial statements.
(d) Foreign security values are stated in U.S. dollars. For debt securities, principal amounts are
denominated in the currency indicated.
(e) Identifies issues considered to be illiquid (see Note 6 to the financial statements). Information
concerning such security holdings at Sept. 30, 1996 is as follows:
<S> <C> <C>
Acquisition
Security date Cost
Tempest Reinsurance 09-13-93 $3,000,000
(f) Represents a security sold under Rule 144A, which is exempt from registration under the
Securities Act of 1933, as amended. This security has been determined to be liquid under
guidelines established by the board.
(g) Commercial paper sold within terms of a private placement memorandum, exempt from
registration under Section 4(2) of the Securities Act of 1933, as amended, and may be sold only
to dealers in that program or other "accredited investors." This security has been determined
to be liquid under guidelines established by the board.
(h) At Sept. 30, 1996, the cost of securities for federal income tax purposes was $350,841,443
and the aggregate gross unrealized appreciation and depreciation based on that cost was:
Unrealized appreciation...................................$67,676,170
Unrealized depreciation...................................(13,461,655)
Net unrealized appreciation...............................$54,214,515
</TABLE>
<PAGE>
PAGE 29
IDS mutual funds
Global/International funds
Funds in this group seek capital growth and/or income by investing
primarily in foreign securities. Foreign investments may be
subject to currency fluctuations and political and economic risks
of the countries in which the investments are made. They are high
risk mutual funds with a potential for high reward.
IDS Emerging Markets Fund
Invests in a Portfolio comprised primarily of stocks of companies
in developing countries throughout the world that are believed to
offer growth potential. Seeks to provide long-term growth of
capital.
(icon of) world with countries
IDS Global Growth Fund
Invests in a Portfolio comprised primarily of stocks of companies
throughout the world that are positioned to meet market needs in a
changing world economy. These companies offer above-average
potential for long-term growth.
(icon of) world
IDS International Fund
Invests primarily in common stocks of foreign companies that offer
potential for superior growth. The Fund may invest up to 20% of
its assets in the U.S. market.
(icon of) three flags
IDS Global Balanced Fund
Invests in stocks and bonds in, for the most part, major markets
throughout the world, including the U.S. Seeks to provide a
balance of growth of capital and current income.
(icon of) scale holding two worlds
IDS Global Bond Fund
Invests in a Portfolio comprised primarily of debt securities of
U.S. and foreign issuers to seek high total return through income
and growth of capital.
(icon of) globe
Growth funds
Funds in this group seek capital growth, primarily from common
stocks. They are high risk mutual funds with a potential for high
reward.
<PAGE>
PAGE 30
IDS Precious Metals Fund
Invests primarily in the securities of foreign or domestic
companies that explore for, mine and process or distribute gold and
other precious metals. A highly aggressive and speculative fund
that seeks long-term growth of capital.
(icon of) cart of precious gems
IDS Discovery Fund
Invests in small- and medium-size, growth-oriented companies
emphasizing technological innovation and productivity enhancement.
Buys and holds larger growth-oriented stocks.
(icon of) ship
IDS Small Company Index Fund
Invests in all or a representative group of the equity securities
comprising the S&P SmallCap 600 Index, as it strives to provide
long-term capital appreciation.
(icon of) office building
IDS Strategy Aggressive Fund
Invests primarily in common stocks of companies that are selected
for their potential for above-average growth. Above-average means
that their growth potential is better, in the opinion of the
portfolio's investment manager, than the Standard & Poor's
Corporation (S&P) 500 Stock Index.
(icon of) chess piece
IDS Research Opportunities Fund
Invests in a Portfolio comprised primarily of equity securities of
companies included in the S&P 500 Index that are believed to have
strong growth potential. The Portfolio is managed using a research
methodology by the Research Department of AEFC. Goal is long-term
appreciation.
(icon of) magnifying glass
IDS Growth Fund
Invests in a Portfolio comprised primarily of companies that have
above-average potential for long-term growth as a result of new
management, marketing opportunities or technological superiority.
(icon of) trees
<PAGE>
PAGE 31
IDS New Dimensions Fund
Invests in a Portfolio comprised primarily of companies with
significant growth potential due to superiority in technology,
marketing or management. The Fund frequently changes its industry
mix.
(icon of) dimension
IDS Progressive Fund
Invests primarily in undervalued common stocks. The Fund holds
stocks for the long term with the goal of capital growth.
(icon of) shooting star
Growth & income funds
These funds focus on securities of medium to large, well-
established companies that offer long-term growth of capital and
reasonable income from dividends and interest.
IDS Equity Select Fund
Invests primarily in a combination of moderate growth stocks,
higher-yielding equities and bonds. Seeks growth of capital and
income.
(icon of) three pine trees
IDS Blue Chip Advantage Fund
Invests in selected stocks from a major market index. Securities
purchased are those recommended by our research analysts as the
best from each industry represented on the index. Offers potential
for long-term growth as well as dividend income.
(icon of) ribbon
IDS Managed Allocation Fund
Invests in a Portfolio comprised primarily of U.S. equity
securities, U.S. and foreign debt securities, foreign equity
securities and money market instruments. The Fund provides
diversification among these major investment categories and has a
target mix that represents the way the Fund's investments will be
allocated over the long term. Seeks maximum total return.
(icon of) gyroscope
IDS Stock Fund
Invests in a Portfolio comprised primarily of common stock of
companies representing many sectors of the economy. Seeks current
income and growth of capital.
(icon of) building with columns
<PAGE>
PAGE 32
IDS Equity Value Fund
Invests primarily in undervalued common stocks that offer potential
for growth of capital and income.
(icon of) three growing flowers
IDS Utilities Income Fund
Invests primarily in the stocks of public utility companies to seek
high current income and growth of income and capital with reduced
volatility.
(icon of) light bulb
IDS Diversified Equity Income Fund
Invests in a Portfolio comprised primarily of high-yielding common
stocks to seek high current income and, secondarily, to benefit
from the growth potential offered by stock investments.
(icon of) two puzzle pieces
IDS Mutual
Invests in a Portfolio which seeks to balance between common stocks
and senior securities (preferred stocks and bonds). Seeks a
balance of growth of capital and current income.
(icon of) scale of justice
Income funds
The funds in this group invest their assets primarily in corporate
bonds or government securities to seek interest income. Secondary
objective is capital growth. Risk varies by bond quality.
IDS Extra Income Fund
Invests in a Portfolio comprised mainly of long-term, high-yielding
corporate fixed-income securities in the lower rated, higher risk
bond categories to seek high current income. Secondary objective
is capital growth.
(icon of) coins
IDS Bond Fund
Invests mainly in corporate bonds, at least 50% in the higher
rated, lower risk bond categories, or the equivalent, and in
government bonds.
(icon of) greek column
<PAGE>
PAGE 33
IDS Selective Fund
Invests in a Portfolio comprised primarily of high-quality
corporate bonds and other highly rated debt instruments including
government securities and short-term investments. Seeks current
income and preservation of capital.
(icon of) skyline
IDS Federal Income Fund
Invests in a Portfolio comprised primarily of securities issued or
guaranteed as to the timely payment of principal and interest by
the U.S. government, its agencies and instrumentalities. Seeks a
high level of current income and safety of principal consistent
with its type of investments.
(icon of) shield with eagle head enclosed
Tax-exempt income funds
These funds provide tax-free income by investing in municipal
bonds. The income is generally free from federal income tax, but a
portion of the income may be subject to state and local taxes.
Risk varies by bond quality.
IDS Tax-Exempt Bond Fund
Invests mainly in bonds and notes of state or local government
units, with at least 75% in the four highest rated, lowest risk
bond categories.
(icon of) shield with Greek column enclosed
IDS Insured Tax-Exempt Fund
Invests primarily in municipal securities that are insured as to
the timely payment of principal and interest. The insurance
feature minimizes credit risk of the Fund but does not guarantee
the market value of the Fund's shares.
(icon of) shield with star enclosed
IDS State Tax-Exempt Funds
(CA, MA, MI, MN, NY, OH)
Invests primarily in high- and medium-grade municipal securities to
provide income to residents of each respective state that is exempt
from federal, state and local income taxes. (New York is the only
state that is exempt at the local level.)
(icon of) shield with U.S. enclosed
<PAGE>
PAGE 34
IDS High Yield Tax-Exempt Fund
Invests in a Portfolio comprised primarily of medium- and lower-
quality municipal bonds and notes. Lower-quality securities
generally involve greater risk of principal and income.
(icon of) shield with basket of apples enclosed
IDS Intermediate Tax-Exempt Fund
Invests in mainly investment-grade bonds and other debt securities
with intermediate-term maturities issued by state and local
government units. Goal is to seek a high level of current income
exempt from federal taxes.
(icon of) shield with a tree enclosed
Money market funds
These money market funds have three main goals: conservation of
capital, constant liquidity and the highest possible current income
consistent with these objectives. An investment in these funds is
neither insured nor guaranteed by the U.S. government, and there
can be no assurance that these funds will be able to maintain a
stable net asset value of $1.00 per share. Very limited risk.
IDS Cash Management Fund
Invests in such money market securities as high quality commercial
paper, bankers' acceptances, certificates of deposit (CDs) and
other bank securities.
(icon of) piggy bank
IDS Tax-Free Money Fund
Invests primarily in short-term bonds and notes issued by state and
local governments to seek high current income exempt from federal
income taxes.
(icon of) shield with piggy bank enclosed
<PAGE>
PAGE 35
Federal income tax information
IDS Progressive Fund, Inc.
The Fund is required by the Internal Revenue Code of 1986 to tell
its shareholders about the tax treatment of the dividends it pays
during its fiscal year. Some of the dividends listed below were
reported to you on a Form 1099-DIV, Dividends and Distributions,
last January. Dividends paid to you since the end of last year will
be reported to you on a tax statement sent next January.
Shareholders should consult a tax advisor on how to report
distributions for state and local purposes.
IDS Progressive Fund, Inc.
Fiscal year ended Sept. 30, 1996
Class A
Income distributions
taxable as dividend income, 54.33% qualifying for deduction by
corporations.
Payable date Per share
Dec. 29, 1995 $0.19709
Capital gain distribution
taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $0.28460
Total distributions $0.48169
The distribution of $0.48169 per share, payable Dec. 29, 1995,
consisted of $0.12666 derived from net investment income, $0.07043
from net short-term capital gains (a total of $0.19709 taxable as
dividend income) and $0.28460 from net long-term capital gains.
Class B
Income distributions
taxable as dividend income, 54.33% qualifying for deduction by
corporations.
Payable date Per share
Dec. 29, 1995 $0.17994
Capital gain distribution
taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $0.28460
Total distributions $0.46454
The distribution of $0.46454 per share, payable Dec. 29, 1995,
consisted of $0.10951 derived from net investment income, $0.07043
from net short-term capital gains (a total of $0.17994 taxable as
dividend income) and $0.28460 from net long-term capital gains.
<PAGE>
PAGE 36
Class Y
Income distributions
taxable as dividend income, 54.33% qualifying for deduction by
corporations.
Payable date Per share
Dec. 29, 1995 $0.20710
Capital gain distribution
taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $0.28460
Total distributions $0.49170
The distribution of $0.49170 per share, payable Dec. 29, 1995,
consisted of $0.13667 derived from net investment income, $0.07043
from net short-term capital gains (a total of $0.20710 taxable as
dividend income) and $0.28460 from net long-term capital gains.
<PAGE>
PAGE 37
Quick telephone reference
American Express Telephone Transaction Service
Redemptions and exchanges, dividend payments or reinvestments and
automatic payment arrangements
National/Minnesota: 800-437-3133
Mpls./St. Paul area: 671-3800
American Express Shareholder Service
Fund performance, objectives and account inquiries
612-671-3733
TTY Service
For the hearing impaired
800-846-4852
American Express Infoline
Automated account information (TouchToneR phones only), including
current fund prices and performance, account values and recent
account transactions
National/Minnesota: 800-272-4445
Mpls./St. Paul area: 671-1630
AMERICAN
EXPRESS
Financial
Advisors
IDS Progressive Fund
IDS Tower 10
Minneapolis, MN 55440-0010
<PAGE>
PAGE 38
STATEMENT OF DIFFERENCES
Difference Description
1) The layout is different 1) Some of the layout in the
throughout the annual report. annual report to
shareholders is in two
columns.
2) Headings. 2) The headings in the
annual report are
placed in a blue strip
at the top of the page.
3) There are pictures, icons 3) Each picture, icon and
and graphs throughout the graph is described in
annual report. parentheses.
4) Footnotes for charts and 4) The footnotes for each
graphs are described at chart or graph are typed
the left margin. below the description of
the chart or graph.
