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SIGNATURE S. ELLIOTT COHAN
TITLE ASST. GEN. COUNSEL
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors of
FEDERATED AMERICAN LEADERS FUND, INC.:
In planning and performing our audit of the financial statements of
Federated American Leaders Fund, Inc. (a Maryland corporation) for the year
ended March 31, 1998, 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 Federated American Leaders Fund, Inc. 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 controls. Generally,
controls 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.
These controls include the safeguarding of assets against unauthorized
acquisition, use or disposition.
Because of inherent limitations in internal control, error or fraud may
occur and not be detected. Also, projection of 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 one or more of 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 internal control and its operation,
including controls for safeguarding securities, that we consider to be
material weaknesses as defined above as of March 31, 1998.
This report is intended solely for the information and use of management,
the Board of Directors of Federated American Leaders Fund, Inc., and the
Securities and Exchange Commission.
ARTHUR ANDERSEN LLP
Pittsburgh, Pennsylvania,
May 15, 1998
