SCOUT MONEY MARKET FUND INC, 497J, 1997-11-06

SCOUT MONEY MARKET FUND INC
497J, 1997-11-06

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THE
SCOUT
FUNDS

Scout Stock Fund
Scout Regional Fund
Scout Balanced Fund
Scout Bond Fund
Scout WorldWide Fund
Scout Money Market Fund
Scout Tax-Free Money Market Fund

Prospectus
October 31, 1997

PROSPECTUS
October 31, 1997

Scout Stock Fund, Inc.
Scout Regional Fund, Inc.
Scout Bond Fund, Inc.
Scout WorldWide Fund, Inc.
Scout Money Market Fund, Inc.
Scout Tax-Free Money Market Fund, Inc.
Scout Balanced Fund, Inc.

Toll-Free 1-800-996-2862

INVESTMENT OBJECTIVES

The Scout Funds were created especially for the benefit of customers of
affiliated banks of UMB Financial Corporation and those investors who share
the Funds' investment goals. All of the Funds are no-load. Scout Stock Fund's
investment objective is long-term growth of both capital and dividend income.
Scout Regional Fund's objective is long-term growth of both capital and
dividend income through investment in smaller regional companies. Scout Bond
Fund's investment objective is maximum current income consistent with its
quality and maturity standards by investing in a diversified list of fixed-
income obligations. Scout Balanced Fund seeks both long-term capital growth
and high current income. Long-term capital growth is intended to be achieved
primarily by the Fund's investment in a diversified portfolio of equity
securities (common stocks and securities convertible into common stocks). High
current income is intended to be achieved by the Fund's investment in a
diversified portfolio of fixed-income obligations. Scout WorldWide Fund's
objective is long-term growth of both capital and dividend income through
investment in a diversified portfolio of equity securities of established
companies either located outside the United States, or whose primary business
is carried on outside the country. The Fund initially intends to invest in the
securities of foreign issuers issued within the United States such as American
Depository Receipts (ADR's). The Fund intends to spread its investments among
various countries and a number of different industries. (See "Investment
Objective and Portfolio Management Policy" on page 15 of this prospectus. For
a discussion of "Risk Factors Applicable to Foreign Investments" see page 24
of this prospectus.) Scout Money Market Fund offers two portfolios with the
objective of maximizing income consistent with safety of principal and
liquidity. The Fund further seeks to maintain a constant net asset value
(price) of $1.00 per share. Scout Tax-Free Money Market Fund's investment
objective is maximizing income free from federal income tax consistent with
safety of principal and liquidity. The Fund further seeks to maintain a
constant net asset value (price) of $1.00 per share by investing in short-term
investment-grade municipal securities which are exempt from federal income
tax. There are, however, no guarantees that any of the Funds' objectives will
be met, or that the $1.00 per share price of the Money Market or Tax-Free
Money Market Funds will be maintained. The shares offered by this prospectus
are not deposits or obligations of, nor guaranteed by, UMB Bank, n.a. or any
other banking institution, nor are they insured by the Federal Deposit
Insurance Corporation (F.D.I.C.) or other deposit insurance. These shares
involve investment risks, including the possible loss of the principal amount
invested.

PURCHASE INFORMATION

Minimum Investment (each Fund or Portfolio selected)
Initial Purchase $ 1,000
(unless Automatic Monthly)
Initial IRA and Uniform Transfers
(Gifts) to Minors Purchases $ 250
(unless Automatic Monthly)
Subsequent Purchase:
(unless Automatic Monthly)
By Mail $ 100
By Telephone Purchase (ACH) $ 100
By Wire $ 500
Automatic Monthly Purchases:
Initial $ 100
Subsequent $ 50

Shares are purchased and redeemed at net asset value. There are no sales,
redemption or Rule 12b-1 distribution charges. If you need further
information, please call the Fund at the telephone number indicated.

ADDITIONAL INFORMATION

This prospectus should be read and retained for future reference. It contains
the information that you should know before you invest. A "Statement of
Additional Information" of the same date as this prospectus has been filed
with the Securities and Exchange Commission and is incorporated by reference.
Investors desiring additional information about the Funds may obtain a copy
without charge by writing or calling the Fund.

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

TABLE OF CONTENTS

Page

Highlights 2
Fund Expenses 4
Financial Highlights 8
Investment Objective and
Portfolio Management Policy 15
Repurchase Agreements 23
Risk Factors 23
Investment Restrictions 24
Performance Measures 24
How to Purchase Shares 26
Initial Investments 26
Investments Subsequent to Initial Investment 27
Telephone Investment Service 27
Automatic Monthly Investment Plan 27
How to Redeem Shares 28
Systematic Redemption Plan 31
How to Exchange Shares
Between Scout Funds 31
How Share Price is Determined 32
Officers and Directors 33
Manager and Underwriter 33
General Information and History 35
Dividends, Distributions and Their Taxation 37
Shareholder Services 39
Shareholder Inquiries 39

Highlights

For more information on this subject see page.

The Funds - The Scout Funds are a group of seven open-end diversified
investment companies sponsored by Jones & Babson, Inc. especially for
customers of affiliate banks of UMB Financial Corporation. 1

All of the Funds are incorporated in Maryland. Scout Stock Fund, Scout Bond
Fund and Scout Tax-Free Money Market Fund were incorporated on July 29, 1982.
Scout Money Market Fund was incorporated on June 23, 1982. Scout Regional Fund
was incorporated on July 8, 1986, Scout WorldWide Fund was incorporated on
January 7, 1993, and Scout Balanced Fund was incorporated on July 13, 1995.
35

Securities - Scout Stock Fund, Regional Fund, Bond Fund, Tax-Free Money
Market Fund, WorldWide Fund, and Balanced Fund each offer one class of non-
assessable common shares with equal voting rights. Scout Money Market Fund
offers its common shares in two series-Federal and Prime. Both portfolios
have the same objective but vary as to the types of securities held. 35

Scout Stock Fund invests in common stocks of companies selected for their
promise of long-term growth of both capital and dividend income. 15

Scout Regional Fund invests in common stocks of midwestern regional companies
selected for their promise of long-term growth of both capital and dividend
income. 15

Scout Bond Fund seeks maximum current income consistent with its quality and
maturity standards by investing in fixed income obligations. 16

Scout Money Market Fund and Scout Tax-Free Money Market Fund are convenient
facilities for investors to manage their money over the short-term for the
purpose of maximizing income consistent with safety of principal and
liquidity. Maturities will not exceed one year. Average-weighted maturity in
each portfolio or fund will not exceed 90 days. Scout Money Market Fund
holdings will be limited to domestic issues of high quality. Scout Tax-Free
Money Market Fund holdings will be primarily invested in domestic issues of
high quality municipal securities. 18

Scout WorldWide Fund invests in equity securities of established companies
either located outside the U.S. or whose primary business is carried on
outside the country. 20

Scout Balanced Fund seeks both long-term capital growth by investment in
equity securities and high current income by investment in fixed-income
obligations. 22

How to Invest - Fund shares can only be purchased directly from the Funds
through the underwriter, Jones & Babson, Inc. The minimum initial purchase is
$1,000 unless your purchase is pursuant to an IRA or the Uniform Transfers
(Gifts) to Minors Act, in which case the minimum initial purchase is $250.
Subsequent purchases must be at least $100, except wire purchases which must
be in the amount of $500 or more. 26

Telephone Investment - You may make investments of $100 or more by telephone
if you have authorized such investments. 27

Automatic Monthly Investment - You may elect to make monthly investments in a
constant dollar amount from your checking account ($50 minimum, after an
initial investment of $100 or more). 27

Redemption - Shares of the Funds are redeemable at net asset value next
effective after receipt by the Fund of a shareholder's request in good order.
No redemption charge is made.
28

Exchange Privilege with Other Scout Funds - Shareholders may transfer their
investment without charge to any other Scout Fund. Since this exchange
involves the liquidation of shares from one Fund and a purchase of shares in
another Fund, the transaction may or may not be taxable depending on the
shareholder's tax status. 31

Automatic Exchange - You may exchange shares from your account ($100
minimum) in any Scout Fund to an identically registered account in any other
Scout Fund according to your instructions. Monthly exchanges will be continued
until all shares have been exchanged or you terminate the Automatic Exchanges
authorization.

Management of the Funds and Fees - The Funds are managed by UMB Bank, n.a.
which supplies all normal services necessary for the Funds to function as
open-end diversified investment companies. The Management Fees charged by the
Bank to each Fund cover all normal operating costs, exclusive of taxes and
other charges of governments and their agencies (including the cost of
qualifying the Funds' shares for sale in any jurisdiction), certain fees,
dues, interest, brokerage commissions and extraordinary costs, if any. Scout
Money Market Fund and Scout Tax-Free Money Market Fund are charged an annual
fee of 50/100 of 1% (0.50%) of the Funds' average daily net assets. Scout
Stock Fund, Scout Regional Fund, Scout Bond Fund, Scout WorldWide Fund, and
Scout Balanced Fund are charged annual fees of 85/100 of 1% (0.85%) of the
Funds' average daily net assets. Although these fees are higher than the fees
of most other managers whose charges cover only investment advisory services
with all remaining operational expenses absorbed directly by the Fund, it is
anticipated that UMB Bank's charges will compare favorably with other managers
when all expenses of Fund shareholders are taken into account. 33

Dividend Policies - Scout Stock Fund, Regional Fund, WorldWide Fund and
Balanced Fund will pay substantially all of their net investment income
semiannually, usually in June and December. It is contemplated that
substantially all of any net capital gains realized during a fiscal year will
be distributed with the fiscal year-end dividend, with any remaining balance
paid in December. 37

Scout Tax-Free Money Market Fund and each Portfolio of Scout Money Market Fund
declare a dividend every business day, equal to substantially all of their
undistributed net investment income which is pro-rated daily among the shares
eligible to receive it. Daily dividends are accumulated and paid monthly.
These Funds' policies relating to maturities make it unlikely that they will
have capital gains or losses. 37

Scout Bond Fund will declare a dividend every business day, equal to
substantially all of the Fund's undistributed net investment income which is
pro-rated daily among the shares eligible to receive it. Daily dividends are
accumulated and paid monthly. Substantially all of any net capital gains
realized during a fiscal year will be distributed with the fiscal year-end
dividend, with any remaining balance paid in December. 37

Taxes - The Funds will distribute substantially all of their net income each
year in order to be exempt from federal income tax. Dividend and capital gains
distributions will be taxable to each shareholder in accordance with the
shareholder's tax status. 37

Risk Factors - Risk Factors generally include interest rate risk, currency
risk and general equity risk.

For a discussion of risk factors applicable to repurchase agreements. 23

For a discussion of risk factors peculiar to money market instruments.
23

For a discussion of risk factors applicable to concentration of assets in the
banking industry. 23

For a discussion of risk factors applicable to foreign investments. 24

FUND EXPENSES
The following information is provided in order to assist you in
understanding the various costs and expenses that a shareholder of a Scout
Fund will bear directly or indirectly.

Scout Stock Fund
The expenses set forth below are based on the fiscal year ended June 30, 1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses .01%
Total Fund operating expenses .86%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$9 $28 $48 $106

Scout Regional Fund

The expenses set forth below are based on the fiscal period ended June 30, 1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses .02%
Total Fund operating expenses .87%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$9 $28 $48 $108

Scout Bond Fund

The expenses set forth below are based on the fiscal year ended June 30,1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses .02%
Total Fund operating expenses .87%
You would pay the following expenses on a $1,000 investment, assuming (1) 5%
annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$9 $28 $48 $107

Scout Money Market Fund (Federal Portfolio)

The expenses set forth below are based on the fiscal year ended June 30,1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .50%
12b-1 fees None
Other expenses .02%
Total Fund operating expenses .52%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$5 $17 $29 $65

Scout Money Market Fund (Prime Portfolio)

The expenses set forth below are based on the fiscal year ended June 30, 1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .50%
12b-1 fees None
Other expenses .01%
Total Fund operating expenses .51%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$5 $16 $29 $64

Scout Tax-Free Money Market Fund

The expenses set forth below are based on the fiscal year ended June 30, 1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .50%
12b-1 fees None
Other expenses .05%
Total Fund operating expenses .55%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$6 $18 $31 $69
Scout WorldWide Fund, Inc.

The expenses set forth below are based on the fiscal period ended June 30, 1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses .01%
Total Fund operating expenses .86%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$9 $27 $48 $106
Scout Balanced Fund, Inc.

The expenses set forth below are based on the fiscal period ended June 30, 1997.
Shareholder Transaction Expenses
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales load None
Redemption fee None
Exchange fee None
Annual Fund Operation Expenses
(as a percentage of average net assets)
Management fees .85%
12b-1 fees None
Other expenses None
Total Fund operating expenses .85%
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:

1 Year 3 Year 5 Year 10 Year
$9 $27 $47 $105

The above examples should not be considered a representation of past or
future expenses as actual expenses may be greater or less than those
shown. The assumed 5% annual return is hypothetical and should not be
considered a representation of past or future annual return. The actual
return may be greater or less than the assumed amount.
The purpose of the foregoing fee tables is to assist the investor in
understanding the various costs and expenses that an investor in a Fund
will bear directly or indirectly. The various costs and expenses are
explained in more detail in this prospectus. Management fees are
discussed in greater detail under "Manager and Underwriter."

FINANCIAL HIGHLIGHTS

Scout Stock Fund, Inc.

The following financial highlights for the ten years ended June 30, 1997, are
from audited financial statements of Scout Stock Fund, Inc. and should be
read in conjunction with the financial statements of the Fund and the report
of Baird, Kurtz & Dobson, independent certified public accountants, appearing
in the June 30, 1997, Annual Report to Shareholders which is incorporated by
reference in this prospectus. The information for each of the eight years in
the period ended June 30, 1995, is covered by the report of other auditors.

<TABLE>
<CAPTION>
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $ 16.69 $ 16.36 $ 15.42 $ 15.74 $ 15.11 $ 14.16 $ 13.69 $ 13.30 $ 13.07 $ 15.26

Income from investment operations:
Net investment income 0.43 0.48 0.48 0.35 0.36 0.44 0.54 0.58 0.54 0.45
Net realized and unrealized gains
or (losses) on securities 2.23 1.36 2.06 0.49 1.34 1.08 0.59 0.55 1.31 (1.09)
Total from investment
operations 2.66 1.84 2.54 0.84 1.70 1.52 1.13 1.13 1.85 (0.64)

Distributions from:
Net investment income (0.42) (0.47) (0.47) (0.35) (0.35) (0.43) (0.54) (0.58) (0.76) (0.43)
Net realized gain on
investment transactions (0.60) (1.04) (1.13) (0.81) (0.72) (0.14) (0.12) (0.16) (0.86) (1.12)
Total distributions (1.02) (1.51) (1.60) (1.16) (1.07) (0.57) (0.66) (0.74) (1.62) (1.55)
Net asset value, end of year $ 18.33 $ 16.69 $ 16.36 $ 15.42 $ 15.74 $ 15.11 $ 14.16 $ 13.69 $ 13.30 $ 13.07
Total return 16% 12% 17% 5% 11% 11% 9% 9% 15% (4%)

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 193 $ 171 $ 137 $ 115 $ 102 $ 76 $ 53 $ 48 $ 41 $ 43
Ratio of expenses to average
net assets 0.86% 0.85% 0.86% 0.87% 0.87% 0.86% 0.85% 0.88% 0.87% 0.86%
Ratio of net investment income
to average net assets 2.48% 2.81% 3.01% 2.22% 2.30% 2.91% 4.03% 4.23% 4.08% 3.41%
Portfolio turnover rate 16% 28% 52% 22% 21% 12% 8% 9% 17% 33%
Average commission rate* $ .0468 $ .0501 - - - - - - - -
</TABLE>

*For fiscal years beginning on or after September 1, 1995, a fund is required
to disclose its average commission rate per share for security trades on which
commissions are charged. This amount may vary from period to period and fund
to fund depending on the mix of trades executed in various markets where
trading practices and commission rate structures may differ.

Scout Regional Fund, Inc.

The following financial highlights for each of the periods presented to
June 30, 1997, are from audited financial statements of Scout Regional Fund,
Inc. and should be read in conjunction with the financial statements of the
Fund and the report of Baird, Kurtz & Dobson, independent certified public
accountants, appearing in the June 30, 1997, Annual Report to Shareholders
which is incorporated by reference in this prospectus. The information for
each of the periods ended June 30, 1991, and prior is covered by the report
of other auditors.

<TABLE>
<CAPTION>
Year
Ended Jan. 1, 1996 July 1 to
June 30, to June 30, Years Ended Dec. 31, Dec. 31, Years Ended June 30,
1997 1996** 1995 1994 1993 1992 1991* 1991 1990 1989 1988
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $10.38 $10.11 $ 9.20 $ 9.49 $ 9.09 $ 8.30 $ 8.28 $ 8.24 $ 8.27 $ 9.24 $10.03
Income from investment operations:
Net investment income 0.22 0.10 0.19 0.18 0.12 0.12 0.03 0.60 0.64 0.68 0.67
Net realized and unrealized gains
or (losses) on securities 1.32 0.67 1.62 (0.12) 0.42 0.79 (0.01) 0.04 (0.03) (0.97) (0.77)
Total from investment
operations 1.54 0.77 1.81 0.06 0.54 0.91 0.02 0.64 0.61 (0.29) (0.10)

Distributions from:
Net investment income (0.18) (0.10) (0.19) (0.18) (0.14) (0.12) - (0.60) (0.64) (0.68) (0.67)
Net realized gain on
investment transactions (0.53) (0.40) (0.71) (0.17) - - - - - - (0.02)
Total distributions (0.71) (0.50) (0.90) (0.35) (0.14) (0.12) - (0.60) (0.64) (0.68) (0.69)
Net asset value, end of period $11.21 $10.38 $10.11 $ 9.20 $ 9.49 $ 9.09 $ 8.30 $ 8.28 $ 8.24 $ 8.27 $ 9.24
Total return 15% 15% 20% 1% 6% 11% .2% 8% 8% (3%) (1%)

Ratios/Supplemental Data
Net assets, end of period (in millions)$ 49 $ 42 $ 36 $ 28 $ 25 $ 8 $ 2 $ .4 $ 2 $ 2 $ 5
Ratio of expenses to
average net assets 0.87% 0.86% 0.89% 0.91% 0.92% 1.06% 2.93%* 1.04% 1.12% 1.06% 1.04%
Ratio of net investment income to
average net assets 2.09% 1.94% 1.95% 1.95% 1.81% 1.91% 0.93% 7.13% 7.68% 7.66% 6.79%
Portfolio turnover rate 20% 29% 37% 27% 17% 7% 14% 0% 0% 8% 12%
Average commission rate*** $.0496 $.0477 - - - - - - - - -
</TABLE>

*Includes fees to register Fund shares for sale in additional States.

**Ratios for this period of operation are annualized.

***For fiscal years beginning on or after September 1, 1995, a fund is
required to disclose its average commission rate per share for security
trades on which commissions are charged. This amount may vary from period to
period and fund to fund depending on the mix of trades executed in various
markets where trading practices and commission rate structures may differ.

Scout Bond Fund, Inc.

The following financial highlights for the ten years ended June 30, 1997,
are from audited financial statements of Scout Bond Fund, Inc. and should be
read in conjunction with the financial statements of the Fund and the report
of Baird, Kurtz & Dobson, independent certified public accountants, appearing
in the June 30, 1997, Annual Report to Shareholders which is incorporated by
reference in this prospectus. The information for each of the eight years in
the period ended June 30, 1995, is covered by the report of other auditors.

<TABLE>
<CAPTION>
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $ 10.93 $ 11.10 $ 10.75 $ 11.53 $ 11.14 $ 10.68 $ 10.48 $ 10.44 $ 10.85 $ 10.98

Income from investment operations:
Net investment income 0.62 0.62 0.63 0.62 0.68 0.75 0.80 0.81 0.80 0.80
Net realized and unrealized gains
or (losses) on securities 0.05 (0.16) 0.35 (0.74) 0.39 0.43 0.16 0.02 0.04 (0.07)
Total from investment
operations 0.67 0.46 0.98 (0.12) 1.07 1.18 0.96 0.83 0.84 0.73

Distributions from:
Net investment income (0.62) (0.62) (0.63) (0.62) (0.68) (0.72) (0.76) (0.79) (1.22) (0.85)
Net realized gain on
investment transactions - (0.01) -* (0.04) - - - - (0.03) (0.01)
Total distributions (0.62) (0.63) (0.63) (0.66) (0.68) (0.72) (0.76) (0.79) (1.25) (0.86)
Net asset value, end of year $ 10.98 $ 10.93 $ 11.10 $ 10.75 $ 11.53 $ 11.14 $ 10.68 $ 10.48 $ 10.44 $ 10.85
Total return 6% 4% 10% (1)% 10% 11% 9% 8% 8% 7%

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 79 $ 81 $ 77 $ 82 $ 87 $ 63 $ 43 $ 34 $ 28 $ 30
Ratio of expenses to average
net assets 0.87% 0.86% 0.86% 0.87% 0.87% 0.87% 0.87% 0.88% 0.88% 0.87%
Ratio of net investment income
to average net assets 5.69% 5.63% 5.91% 5.50% 5.95% 6.77% 7.44% 7.61% 7.69% 7.47%
Portfolio turnover rate 19% 12% 2% 9% 19% 24% 21% 13% 8% 7%
</TABLE>

*Capital gain distribution of .003 not significant for per share table.

Scout Money Market Fund, Inc.

The following financial highlights for the ten years ended June 30, 1997,
are from audited financial statements of Scout Money Market Fund, Inc. and
should be read in conjunction with the financial statements of the Fund and
the report of Baird, Kurtz & Dobson, independent certified public accountants,
appearing in the June 30, 1997, Annual Report to Shareholders which is
incorporated by reference in this prospectus. The information for each of
the nine years in the period ended June 30, 1996, is covered by the report of
other auditors.

<TABLE>
<CAPTION>
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Prime Portfolio
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment operations:
Net investment income 0.05 0.05 0.05 0.03 0.03 0.04 0.07 0.08 0.08 0.06
Distributions from:
Net investment income (0.05) (0.05) (0.05) (0.03) (0.03) (0.04) (0.07) (0.08) (0.08) (0.06)
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total return 5% 5% 5% 3% 3% 5% 7% 8% 9% 7%

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 445 $ 330 $ 245 $ 172 $ 214 $ 209 $ 217 $ 142 $ 116 $ 91
Ratio of expenses to average
net assets 0.51% 0.51% 0.51% 0.51% 0.51% 0.51% 0.51% 0.51% 0.52% 0.51%
Ratio of net investment income
to average net assets 4.97% 5.16% 5.10% 2.92% 2.87% 4.44% 6.85% 8.19% 8.58% 6.69%

Federal Portfolio
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment operations:
Net investment income 0.05 0.05 0.05 0.03 0.03 0.04 0.07 0.08 0.08 0.06
Distributions from:
Net investment income (0.05) (0.05) (0.05) (0.03) (0.03) (0.04) (0.07) (0.08) (0.08) (0.06)
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total return 5% 5% 5% 3% 3% 5% 7% 8% 8% 7%

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 238 $ 228 $ 183 $ 195 $ 271 $ 250 $ 217 $ 139 $ 151 $ 129
Ratio of expenses to average
net assets 0.52% 0.51% 0.51% 0.50% 0.50% 0.51% 0.51% 0.52% 0.50% 0.50%
Ratio of net investment income
to average net assets 4.92% 5.09% 4.97% 2.81% 2.81% 4.43% 6.68% 8.19% 8.12% 6.31%
</TABLE>

Scout Tax-Free Money Market Fund, Inc.

The following financial highlights for the ten years ended June 30, 1997,
are from audited financial statements of Scout Tax-Free Money Market Fund,
Inc. and should be read in conjunction with the financial statements of the
Fund and the report of Baird, Kurtz & Dobson, independent certified public
accountants, appearing in the June 30, 1997, Annual Report to Shareholders
which is incorporated by reference in this prospectus. The information for
each of the eight years in the period ended June 30, 1995, is covered
by the report of other auditors.

<TABLE>
<CAPTION>
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment operations:
Net investment income 0.03 0.03 0.03 0.02 0.02 0.03 0.05 0.05 0.05 0.04
Distributions from:
Net investment income (0.03) (0.03) (0.03) (0.02) (0.02) (0.03) (0.05) (0.05) (0.05) (0.04)
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total return 3% 3% 3% 2% 2% 3% 5% 6% 6% 4%

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 162 $ 128 $ 78 $ 94 $ 66 $ 77 $ 67 $ 57 $ 71 $ 67
Ratio of expenses to average
net assets 0.55% 0.52% 0.54% 0.53% 0.52% 0.52% 0.53% 0.53% 0.52% 0.53%
Ratio of net investment
income to average net assets 3.16% 3.13% 3.20% 2.06% 2.15% 3.32% 4.80% 5.54% 5.66% 4.39%
</TABLE>

Scout WorldWide Fund, Inc.

The following financial highlights for each of the periods presented from
inception (September 14, 1993) to June 30, 1997, are from audited financial
statements of Scout WorldWide Fund, Inc. and should be read in conjunction
with the financial statements of the Fund and the report of Baird, Kurtz &
Dobson, independent certified public accountants, appearing in the June 30,
1997, Annual Report to Shareholders which is incorporated by reference in
this prospectus.

<TABLE>
<CAPTION>
Year Ended January 1, 1996 to Years Ended December 31, September 14, 1993
June 30, 1997 June 30, 1996** 1995 1994 to December 31, 1993*
</CAPTION>
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 12.90 $ 12.08 $ 10.84 $ 10.68 $ 10.13

Income from investment operations:
Net investment income 0.26 0.14 0.22 0.17 0.03
Net realized and unrealized gains
on securities 3.12 0.86 1.36 0.23 0.55
Total from investment operations 3.38 1.00 1.58 0.40 0.58
Distributions from:
Net investment income (0.21) (0.14) (0.22) (0.17) (0.03)
Net realized gain on
investment transactions (0.07) (0.04) (0.12) (0.07) -
Total distributions (0.28) (0.18) (0.34) (0.24) (0.03)
Net asset value, end of period $ 16.00 $ 12.90 $ 12.08 $ 10.84 $ 10.68
Total return 26% 17% 15% 4% 21%

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 48 $ 31 $ 24 $ 18 $ 6
Ratio of expenses to average
net assets 0.86% 0.85% 0.85% 0.85% 0.85%
Ratio of net investment income
to average net assets 1.93% 2.40% 1.97% 1.87% 1.43%
Portfolio turnover rate 18% 5% 27% 24% 2%
Average commission rate*** $ .0315 $ .0468 - - -
</TABLE>

*The Fund was capitalized on March 5, 1993 with $100,000, representing 10,000
shares at a net asset value of $10.00 per share. Initial public offering was
made on September 14, 1993, at which time net asset value was $10.13 per
share.

Ratios for this initial period of operation are annualized.

**Ratios for this period of operation are annualized.

Scout Balanced Fund, Inc.

The following financial highlights for each of the periods presented from
inception (December 6, 1995) to June 30, 1997, are from audited financial
statements of Scout Balanced Fund, Inc. and should be read in conjunction
with the financial statements of the Fund and the report of Baird, Kurtz &
Dobson, independent certified public accountants, appearing in the June 30,
1997, Annual Report to Shareholders which is incorporated by reference in
this prospectus.

<TABLE>
<CAPTION>
Year Ended December 6, 1995
June 30, 1997 to June 30, 1996*
</CAPTION>
<S> <C> <C>
Net asset value, beginning of period $ 10.18 $ 10.09

Income from investment operations:
Net investment income 0.35 0.27
Net realized and unrealized
gains on securities 0.52 0.06
Total from investment operations 0.87 0.33
Distributions from:
Net investment income (0.32) (0.24)
Net realized gain on
investment transactions (0.01) -
Total distributions (0.33) (0.24)
Net asset value, end of period $ 10.72 $ 10.18
Total return 9% 6%

Ratios/Supplemental Data
Net assets, end of year (in millions) $ 8 $ 3
Ratio of expenses to average
net assets 0.85% 0.85%
Ratio of net investment income
to average net assets 3.85% 3.71%
Portfolio turnover rate 14% 5%
Average commission rate** $ .0641 $ .0660
</TABLE>

*The Fund was capitalized on October 2, 1995 with $100,000,
representing 10,000 shares at a net asset value of $10.00 per share.
Initial public offering was made on December 6, 1995, at which time net asset
value was $10.09 per share.
Ratios for this initial period of operation are annualized.

**For fiscal years beginning on or after September 1, 1995, a fund is
required to disclose its average commission rate per share for security
trades on which commissions are charged. This amount may vary from period to
period and fund to fund depending on the mix of trades executed in various
markets where trading practices and commission rate structures may differ.

INVESTMENT OBJECTIVE AND PORTFOLIO MANAGEMENT POLICY

Each Fund's objectives and policies as described in this section will not be
changed without approval of a majority of the Fund's outstanding shares.

Scout Stock Fund

Scout Stock Fund's objective is to provide investors with long-term growth of
both capital and dividend income. Current yield is secondary to the long-term
growth objective.

The Fund cannot guarantee that these objectives will be achieved because there
are inherent risks in the ownership of the investments made by the Fund. The
value of the Fund's shares will reflect changes in the market value of its
investments, and dividends paid by the Fund will vary with the income it
receives from these investments. Through careful management and
diversification it will seek to reduce risk and enhance the opportunities for
long-term growth of capital and income.

Normally the Fund will invest at least 80% of its total assets (exclusive of
cash) in common stocks. There are no restrictions or guidelines regarding
investments of Fund assets in shares listed on an exchange or traded over-the-
counter.

The Fund believes the true value of a company's stock is determined by its
earning power, dividend-paying ability, and in many cases, by its assets.
Consequently, the primary emphasis will be placed on progressive well-managed
companies in growing industries that have demonstrated both a consistent and
an above-average ability to increase their earnings and dividends and which
have favorable prospects of sustaining such growth.

The Fund also believes that the intrinsic worth and the consequent value of
the stock of most well-managed and successful companies usually does not
change rapidly, even though wide variations in the price may occur. So
normally, long-term positions in stocks of the portfolio companies selected
will be taken and maintained while the company's record and prospects continue
to meet with management's approval. The Fund will change its investments when,
in management's judgment, economic and market conditions make such a course
desirable. But such changes will be no more than is necessary to carry out the
Fund's objectives.

Necessary reserves will be held in cash or short-term debt obligations,
including repurchase agreements (see below), readily changeable to cash. The
management believes, however, that there may be times when the shareholders'
interests are best served and the objectives are most likely to be achieved,
by investing in securities convertible into common stocks, preferred stocks,
high-grade bonds or other defensive issues. It retains the freedom to
administer the portfolio of the Fund accordingly when, in its judgment,
economic and market conditions make such a course desirable.

The Fund also may invest in issues of the United States Treasury and United
States government agencies subject to repurchase agreements entered into with
the seller of the issue. The use of repurchase agreements by the Fund involves
certain risks. For a discussion of repurchase agreements and their risks see
page 23.

Although the Fund does not intend to obtain short-term trading profits, it is
possible that holdings may be increased when a stock is considered to be
undervalued and decreased when it is considered to be overvalued. Scout Stock
Fund's annualized turnover ratio for the fiscal year ended June 30, 1995, was
52%, for June 30, 1996, it was 28%, and for June 30, 1997, it was 16%.
Commissions paid during the fiscal year ended June 30, 1997, amounted to
$57,961.

The Fund does not intend to concentrate its investments in any particular
industry. Without the approval of shareholders, it will not purchase a
security if as a result of such purchase more than 25% of its assets will be
invested in a particular industry.

Scout Regional Fund

The Scout Regional Fund's objective is to provide long-term growth of both
capital and dividend income through investment in smaller regional companies.
Current yield is secondary to the long-term growth objective. Scout Regional
Fund invests in a diversified list of common stocks representing such
companies located in or doing a substantial portion of their business in
Missouri, Kansas, Iowa, Nebraska, Arkansas, Oklahoma, Illinois, and Colorado.
Such stocks will be selected for their promise of long-term growth of both
capital and dividend income. There can be no assurance that the Fund will
achieve its objective. This objective may not be changed without shareholder
approval. The Fund will seek to achieve its objective by investing at least
80% of its total assets (exclusive of cash) in a diversified portfolio of
common stocks of smaller companies either located in or having a substantial
portion of their business in Missouri, Kansas, Iowa, Nebraska, Arkansas,
Oklahoma, Illinois, and Colorado. There are no restrictions or guidelines
regarding investment of Fund assets in shares listed on an exchange or traded
over-the-counter.

The Fund generally intends to invest in stocks of such regional companies with
market capitalization of $1 billion or less, although there may be times when
shareholders' interests are best served by investing in preferred stocks,
bonds or other defensive issues. It is not anticipated that the Fund will
invest in "penny stocks" or other issues with very low prices although price
alone will not be a sole determining factor in the selection of investments.

The Fund cannot guarantee that its investment objectives will be achieved
because there are inherent risks in the ownership of any investments,
particularly investments in smaller companies. The value of the Fund's shares
will reflect changes in the market value of its investments, and dividends
paid by the Fund will vary with the income it receives from these investments.
Through careful management and diversification it will seek to reduce risk and
enhance the opportunities for long-term growth of capital and income.

While the Fund's investments will be concentrated in the eight-state region
described above, it does not intend to concentrate its investments in any
particular industry. Without the approval of shareholders, it will not
purchase a security if as a result of such purchase more than 25% of its
assets will be invested in a particular industry. Although there is no
intention to concentrate Fund investments in one or more of the states
mentioned above, there is no limitation upon investments in any particular
state.

The Fund will normally invest at least 75% of its assets in investment-grade
common stocks, but reserves the right to temporarily invest for defensive
purposes less than 75% of its assets in common stocks if, in the opinion of
the Fund's manager, prevailing market conditions warrant. The Fund may invest
the balance, up to 100% of its assets, in preferred stocks or defensive issues
such as short-term money market instruments, commercial paper, bankers'
acceptances, certificates of deposit and other debt securities such as
corporate bonds rated A or better by Moody's or Standard & Poor's, or U.S.
government issues such as treasury bills, treasury notes and treasury bonds.

Necessary reserves will be held in cash or short-term debt obligations,
including repurchase agreements (see below), readily changeable to cash. The
management believes, however, that there may be times when the shareholders'
interests are best served and the Fund's investment objectives are most likely
to be achieved, by investing in securities convertible into common stocks, or
defensive issues such as high-grade bonds or other defensive issues. It
retains the freedom to administer the portfolio of the Fund accordingly when,
in its judgment, economic and market conditions make such a course desirable.

Although the Fund does not intend to obtain short-term trading profits, it is
possible that holdings may be increased when a stock is considered to be
undervalued and decreased when it is considered to be overvalued. Scout
Regional Fund's annualized turnover ratio for the fiscal year ended December
31, 1995, was 37%, for the fiscal period ended June 30, 1996, it was 29%, and
for the fiscal year ended June 30, 1997, it was 20%. Commissions paid during
the fiscal year ended June 30, 1997, amounted to $20,355.

Scout Bond Fund

Scout Bond Fund's investment objective is to provide shareholders with maximum
current income consistent with its quality and maturity standards by investing
in a diversified portfolio of fixed-income obligations. The Fund cannot
guarantee that its objective will be achieved because there are inherent risks
in the ownership of fixed-income investments. The value of the Fund's shares
will reflect changes in the market value of its investments which will vary
inversely with changes in interest rates. Dividends paid by the Fund will vary
according to the income it receives from its investments. However, the Fund
will seek, through careful management and diversification, to reduce these
risks and enhance the opportunities for maximizing current income.

The Fund will normally invest at least 80% of its assets in bonds such as: (1)
direct or guaranteed obligations of the U.S. Government and its agencies, and
(2) high-quality debt securities including notes and bonds issued by
corporations or other business organizations.

The Fund will invest only in the following "U.S. Government Securities:"

1. Direct obligations of the U.S. Government, such as bills, notes,
bonds and other debt securities issued by the U.S. Treasury.

2. Obligations of U.S. government agencies and instrumentalities
which are secured by the full faith and credit of the U.S. Treasury, such as
securities of the Government National Mortgage Association, the Export-Import
Bank, or the Student Loan Marketing Association; or which are secured by the
right of the issuer to borrow from the Treasury, such as securities issued by
the Federal Financing Bank or the U.S. Postal Service; or are supported by the
credit of the government agency or instrumentality itself, such as securities
of Federal Home Loan Banks, Federal Farm Credit Banks, or the Federal National
Mortgage Association.

The Fund's investments in securities issued by corporations or other business
organizations will be rated at the time of purchase within the top three
classifications of Moody's Investors Service, Inc. (Aaa, Aa, and A) or
Standard & Poor's Corporation (AAA, AA and A). The Fund will use obligations
secured by specific assets of the issuing corporation as well as unsecured
debentures which represent claims on the general credit of the issuer. (For a
description of ratings, see "Fixed Income Securities Described and Ratings" in
the "Statement of Additional Information.")

In order to enhance portfolio flexibility and to provide for unexpected
redemptions, the Fund may maintain a portion of its assets in reserves. These
reserves will be held in cash or short-term debt obligations.

The Fund may invest in commercial paper, including variable rate master demand
notes, of companies whose commercial paper is rated P-1 by Moody's or A-1 by
Standard & Poor's. If not rated by either Moody's or Standard & Poor's, a
company's commercial paper, including variable rate master demand notes, may
be purchased by the Fund if the company has an outstanding bond issue rated Aa
or higher by Moody's or AA or higher by S&P.

Variable rate master demand notes represent a borrowing arrangement under a
letter of agreement between a commercial paper issuer and an institutional
lender. Applicable interest rates are determined on a formula basis and are
adjusted on a monthly, quarterly, or other term as set out in the agreement.
They vary as to the right of the lender to demand payment. It is not generally
contemplated that such instruments will be traded, and there is no secondary
market for these notes, although they are redeemable (and thus immediately
repayable by the borrower) at face value, plus accrued interest, at any time.
In connection with the Fund's investment in variable rate master demand notes,
the Fund's manager will monitor on an ongoing basis the earning power, cash
flow and other liquidity ratios of the issuer, and the borrower's ability to
pay principal and interest on demand.

The Fund may invest in certificates of deposit, bankers' acceptances, and
other commercial bank short-term obligations issued domestically by United
States banks having assets of at least $1 billion and which are members of the
Federal Deposit Insurance Corporation, or such securities which may be issued
by holding companies of such banks.

The Fund may also invest in issues of the United States Treasury or United
States government agencies subject to repurchase agreements entered into with
the seller of the issues. The use of repurchase agreements by the Fund
involves certain risks. For a discussion of repurchase agreements and their
risks see page 23.

Maturities of all Fund investments normally will not exceed 20 years at the
date of purchase. However, management may extend maturity limits or change
portfolio holdings or vary portfolio mix when in its judgment economic and
market conditions make it desirable in the best interests of the shareholders.

Although the Fund does not intend to obtain short-term trading profits, it is
possible that it may engage in trading activity in order to take advantage of
opportunities to enhance yield, protect principal or improve liquidity. Scout
Bond Fund's annualized turnover ratio for the fiscal year ended June 30, 1995,
was 2%, for June 30, 1996, it was 12%, and for June 30, 1997, it was 19%.
Commissions paid during the fiscal year ended June 30, 1997, amounted to $250.

Scout Money Market Fund

Scout Money Market Fund offers two separate Portfolios, Federal and Prime,
each of which invest in high quality short-term debt instruments for the
purpose of maximizing income consistent with safety of principal and
liquidity. Each Portfolio also seeks to maintain a constant price of $1.00 per
share. Neither Portfolio's objective can be changed without the approval of a
majority of its outstanding shares. Each Portfolio will limit its holdings to
the types of securities hereinafter described.

Federal Portfolio

The Federal Portfolio will invest only in the following "U.S. Government
Securities:"

1. Direct obligations of the U.S. Government, such as bills, notes,
bonds and other debt securities issued by the U.S. Treasury.

2. Obligations of U.S. government agencies and instrumentalities
which are secured by the full faith and credit of the U.S. Treasury, such as
securities of the Government National Mortgage Association; or which are
secured by the right of the issuer to borrow from the Treasury, such as
securities issued by the Federal Financing Bank or the U.S. Postal Service; or
are supported by the credit of the government agency or instrumentality
itself, such as securities of Federal Home Loan Banks, or the Federal National
Mortgage Association.

The Federal Portfolio also may invest in issues of the United States Treasury
or United States government agencies subject to repurchase agreements entered
into with the seller of the issues. The use of repurchase agreements by the
Fund involves certain risks. For a discussion of repurchase agreements and
their risks see page 23.

Prime Portfolio

The Prime Portfolio may invest in any of the following in addition to
securities eligible for the Federal Portfolio:

1. Certificates of deposit, bankers' acceptances, and other short-
term obligations issued domestically by United States commercial banks having
assets of at least $1 billion and which are members of the Federal Deposit
Insurance Corporation, or holding companies of such banks.

2. Commercial paper, including variable rate master demand notes of
companies whose commercial paper is rated P-2 or higher by Moody's Investors
Service, Inc. (Moody's) or A-2 or higher by Standard and Poor's Corporation
(S&P). If not rated by either Moody's or S&P, a company's commercial paper,
including variable rate master demand notes, may be purchased by the Prime
Portfolio if the company has an outstanding bond issue rated Aa or higher by
Moody's or AA or higher by S&P. Variable rate master demand notes represent a
borrowing arrangement under a letter of agreement between a commercial paper
issuer and an institutional lender. Applicable interest rates are determined
on a formula basis and are adjusted on a monthly, quarterly, or other term as
set out in the agreement. They vary as to the right of the lender to demand
payment. (For a description of money market securities and their ratings, see
"Fixed Income Securities Described and Ratings" in the "Statement of
Additional Information.")

3. Short-term debt securities which are non-convertible and which
have one year or less remaining to maturity at the date of purchase and which
are rated Aa or higher by Moody's or AA or higher by S&P.

4. Negotiable certificates of deposit and other short-term debt
obligations of savings and loan associations having assets of at least $1
billion and which are members of the Federal Home Loan Banks Association and
insured by Federal Deposit Insurance Corporation.

To achieve its objectives the Fund may engage in trading activity in order to
take advantage of opportunities to enhance yield, protect principal or improve
liquidity. This trading activity should not increase the Fund's expenses,
since there are normally no broker's commissions paid by the Fund for the
purchase or sale of money market instruments. However, a markup or spread may
be paid to a dealer from which the Fund purchases a security.

Pursuant to Rule 2a-7 of the Investment Company Act of 1940, as amended, the
Fund will price its shares according to a procedure known as amortized cost,
and will maintain 100% of its assets in securities with remaining maturities
of 397 days or less, and limit its investments to those instruments which the
Directors of the Fund determine present minimal credit risks, and which are
eligible investments under the rule. Each Portfolio will maintain a weighted
average maturity of 90 days or less. Since securities with maturities of one
year or less are excluded from calculation of portfolio turnover, Scout Money
Market Fund has no portfolio turnover ratio. The Fund paid no commissions
during the fiscal year.

Scout Tax-Free Money Market Fund

Scout Tax-Free Money Market Fund's objective is to provide investors with the
highest level of investment income exempt from federal income tax consistent
with its quality and maturity standards. It also seeks to maintain liquidity
and a constant price of $1.00 per share. The Fund cannot guarantee that these
objectives will be achieved, but through careful management and
diversification it will seek to reduce risk and enhance the opportunities for
higher income and greater price stability. The Fund will not purchase any
security which at the time of purchase has a maturity more than one year from
the date of purchase.

During periods of normal market conditions, the Fund will invest at least 80%
of its total assets (exclusive of cash) in short-term municipal securities, as
defined in this prospectus. This fundamental policy will not be changed
without shareholder approval, except that the Fund reserves the right to
deviate temporarily from this policy during extraordinary circumstances when,
in the opinion of management, it is advisable to do so in the best interest of
shareholders, such as when market conditions dictate a defensive posture in
taxable obligations. During the Fund's fiscal year ended June 30, 1997, 100%
of income was exempt from federal income taxes.

Investments in short-term municipal obligations and notes are limited to those
obligations which at the time of purchase: (1) are backed by the full faith
and credit of the United States; (2) are rated MIG-1 or MIG-2 by Moody's; or
(3) if the obligations or notes are not rated, of comparable quality as
determined by the Board of Directors. Short-term discount notes are limited to
those obligations rated A-1 by S&P, or Prime-1 by Moody's or their equivalents
as determined by the Board of Directors. If the short-term discount notes are
not rated, they must be of comparable quality as determined by the Board of
Directors. (For a description of municipal securities and their ratings, see
"Municipal Securities Described and Ratings" in the "Statement of Additional
Information.")

While the Fund normally maintains at least 80% of the portfolio in municipal
securities, it may invest any remaining balance in taxable money market
instruments on a temporary basis, if management believes this action would be
in the best interest of shareholders. Included in this category are:
obligations of the United States of America, its agents or instrumentalities;
certificates of deposit; bankers' acceptances and other short-term debt
obligations of United States banks with total assets of $1 billion or more;
and commercial paper rated A-2 or better by Standard & Poor's Corp. or Prime-2
or better by Moody's Investors Service, Inc., or certain rights to acquire
these securities.

The Fund reserves the right to hold cash reserves as management deems
necessary for defensive or emergency purposes.

It is the policy of the Fund not to invest more than 25% of its assets in any
one classification of municipal securities, except project notes or other tax-
exempt obligations which are backed by the U.S. Government.

Should the rating organizations used by the Fund cease to exist or change
their systems, the Fund will attempt to use other comparable ratings as
standards for its investments in municipal securities in accordance with its
investment policies.

To achieve its objectives the Fund may engage in trading activity in order to
take advantage of opportunities to enhance yield, protect principal or improve
liquidity. This trading activity should not increase the Fund's expenses since
there are normally no brokers' commissions paid by the Fund for the purchase
or sale of money market instruments. However, a markup or spread may be paid
to a dealer from which the Fund purchases a security.

Scout Tax-Free Money Market Fund may invest in issues of the United States
Treasury or United States government agencies subject to repurchase agreements
entered into with the seller of the issue. The use of repurchase agreements by
the Fund involves certain risks. For a discussion of repurchase agreements and
their risks see page 23.

Scout WorldWide Fund

Scout WorldWide Fund intends to invest in a diversified portfolio of equity
securities (common stocks and securities convertible into common stocks) of
established companies either located outside the United States or whose
primary business is carried on outside the country. American Depository
Receipts (ADR's), which represent foreign securities and are traded on U.S.
Exchanges or in the over-the-counter market, will continue to represent the
bulk of the Fund's portfolio. However, the Fund reserves the right to invest
directly in foreign securities or to purchase European Deposit Receipts
(EDR's) and International Depository Receipts (IDR's), in bearer form, which
are designed for use in European and other securities markets. Limiting the
Fund investments to ADR's, may have the effect of limiting the Fund's
investment alternatives and reducing the Fund's potential diversification
resulting in additional risk to the Fund, however, management believes that
use of ADR's in the initial period of operations will be a cost-effective
method of participating in international securities, and will lessen the
exposure of the Fund and its shareholders to various special risks inherent in
foreign securities investments (see "Risk Factors Applicable to Foreign
Investments").

The Fund will use the portfolio management policies described below to attempt
to generate a favorable total return consisting of interest, dividend and
other income, if any, and appreciation in the value of the Fund's portfolio
securities by investing in equity securities which in the opinion of the
manager, offer good growth potential and in many cases pay dividends. The Fund
will look at such factors as the company's assets, personnel, sales, earnings
and location of its corporate headquarters to determine whether more than 50%
of such assets, personnel, sales or earnings are located outside the United
States and therefore the company's primary business is carried on outside the
United States. The Fund diversifies its investments among various countries
and a number of different industries.

There is no guarantee that the Fund's objective will be achieved. Investments
in international securities involve risks in addition to those risks
associated with investments in the United States (see "Risk Factors Applicable
to Foreign Investments"). Therefore, the Fund should be considered only as a
means for international diversification and not as a complete investment
program. The Fund is designed for long-term investors who are able to accept
the risks of international investing. The investment objective of the Fund
cannot be changed without the approval of the holders of a majority of the
Fund's outstanding shares.

The Fund is designed to provide investors with a diversified participation in
international businesses. Over the years, some foreign businesses have been
especially successful in their particular industries and some foreign stock
markets have outperformed the American markets. Foreign securities markets do
not always move in parallel with the U.S. securities markets, so investing in
international securities can provide diversification advantages. Because the
underlying securities of the ADRs' in which the Fund invests trade primarily
in foreign markets, any rise or fall of the U.S. dollar in relation to foreign
currencies will affect their U.S. dollar value and thereby will affect the
investment performance of the Fund. A change in the value of any foreign
currency relative to the dollar will result in a corresponding change in the
dollar value of Fund assets whose underlying securities are denominated or
traded in that currency.

The Fund primarily invests in securities of seasoned companies which are
listed on U.S. stock exchanges and which the manager considers to have
attractive characteristics in terms of profitability, growth and financial
resources. "Seasoned" and "established" companies are those companies which
have been in existence for at least 3 years and, in the opinion of the
investment counsel, are known for the quality and acceptance of their products
or services and for their ability to generate profits and in many cases pay
dividends. The Fund may invest in fixed-income securities of foreign
governments or companies when the manager believes that prevailing market,
economic, political or currency conditions warrant such investments. While
most foreign securities are not subject to standard credit ratings, the
investment counsel intends to select "investment grade" issues of foreign debt
securities which are comparable to a Baa or higher rating by Moody's Investors
Service, Inc. or a BBB or higher rating by Standard and Poor's Corporation,
based on available information, and taking into account liquidity and quality
issues. Securities rated BBB or Baa are considered to be medium grade and have
speculative characteristics. Equity securities of non-United States companies
will be selected on the same criteria as securities of United States domestic
companies. The Fund may invest in securities which are not listed on an
exchange. Generally, the volume of trading in an unlisted common stock is less
than the volume of trading in a listed stock. This means that the degree of
market liquidity of some stocks in which the Fund invests may be relatively
limited. When the Fund disposes of such a stock it may have to offer the
shares at a discount from recent prices or sell the shares in small lots over
an extended period of time. The Fund does not intend to hold assets in its
portfolio in excess of 5% of total assets in securities whose ratings have
dropped below investment grade. The manager will review such securities and
determine appropriate action to take with respect to such securities.

In order to expedite settlement of portfolio transactions and to minimize
currency value fluctuations, the Fund may purchase foreign currencies and/or
engage in forward foreign currency transactions. The Fund will not engage in
forward foreign currency exchange contracts for speculative purposes. A
forward foreign currency exchange contract involves an obligation to purchase
or sell a specific currency at a future date, which may be any fixed number of
days from the date of the contract agreed upon by the parties, at a price set
at the time of the contract. These contracts may be bought or sold to protect
the Fund, to some degree, against a possible loss resulting from an adverse
change in the relationship between foreign currencies and the U.S. dollar.
This method of protecting the value of the Fund's investment securities
against a decline in the value of a currency does not eliminate fluctuations
in the underlying prices of the securities. It establishes a rate of exchange
which one can achieve at some future point in time. Although such contracts
tend to minimize the risk of loss due to a decline in the value of the hedged
currency, at the same time, they tend to limit any potential gain which might
result should the value of such currency increase.

The Fund's dealings in forward foreign exchange will be limited to hedging
involving either specific transactions or portfolio positions. Transaction
hedging is the purchase or sale of forward foreign currency with respect to
specific receivables or payables of the Fund accruing in connection with the
purchase and sale of its portfolio securities, the sale and redemption of
shares of the Fund or the payment of dividends and distributions by the Fund.
Position hedging is the sale of forward foreign currency with respect to
portfolio security positions denominated or quoted in such foreign currency.
The Fund will not speculate in foreign forward exchange. Moreover, it may not
be possible for the Fund to hedge against a devaluation that is so generally
anticipated that the Fund is not able to contract to sell the currency at a
price above the devaluation level it anticipates.

The Fund intends to diversify investments broadly among countries and normally
to have represented in the portfolio business activities of not less than
three foreign countries. Generally, the Fund does not intend to invest more
than 25% of its total assets in any one particular country or securities
issued by a foreign government, its agencies or instrumentalities in the
foreseeable future. However, the Fund may, at times, temporarily invest a
substantial portion of its assets in one or more of such countries if economic
and business conditions warrant such investments.

Necessary reserves will be held in cash or short-term debt obligations,
including repurchase agreements (see below), readily changeable to cash. The
management believes, however, that there may be times when the shareholders'
interests are best served and the Fund's investment objectives are most likely
to be achieved, by investing in securities convertible into common stocks
rated A or better by Standard & Poor's or Moody's, or defensive issues such as
high-grade bonds or other defensive issues rated A or better by Standard &
Poor's or Moody's. It retains the freedom to administer the portfolio of the
Fund accordingly when, in its judgment, economic and market conditions make
such a course desirable.

Scout WorldWide Fund's annualized turnover ratio for the fiscal year ended
December 31, 1995, was 27%, for the fiscal period ended June 30, 1996, it was
5%, and for the fiscal year ended June 30, 1997, it was 18%. Commissions paid
during the fiscal year ended June 30, 1997, amounted to $30,885.

Scout Balanced Fund

Scout Balanced Fund seeks both long-term capital growth and high current
income. Long-term capital growth is intended to be achieved primarily by the
Fund's investment in a diversified portfolio of equity securities (common
stocks and securities convertible into common stocks). High current income is
intended to be achieved by the Fund's investment in a diversified portfolio of
fixed-income obligations.

The Fund will normally invest in a diversified portfolio of securities. The
Fund has the flexibility to pursue its objective through any type or quality
of domestic or foreign security. The manager will shift the proportions of
each type of investment based on interpretation of economic conditions and
underlying security valuations. Normally the Fund will invest at least 25% of
its total assets in equity securities and a minimum of 25% of its total assets
in fixed income senior obligations. When, in the manager's judgment, market
conditions warrant, the Fund, for defensive purposes, may make substantial
temporary investments in high quality money market securities.

The Fund will normally invest in the following fixed income securities:

1. Direct obligations of the U.S. Government, such as bills, notes,
bonds and other debt securities issued by the U.S. Treasury.

2. Obligations of U.S. government agencies and instrumentalities which
are secured by the full faith and credit of the U.S. Treasury; such as
securities of the Government National Mortgage Association; or which are
secured by the right of the issuer to borrow from the Treasury, such as
securities issued by the Federal Financing Bank or the U.S. Postal Service; or
are supported by the credit of the government agency or instrumentality
itself, such as securities of Federal Home Loan Banks, Federal Farm Credit
Banks, or the Federal National Mortgage Association.

3. Securities issued by corporations or other business organizations.
The Fund will generally invest in securities that, at the time of purchase,
are classified as investment grade by Moody's Investors Service, Inc. or by
Standard & Poor's Corporation. Securities that are subsequently downgraded to
non-investment grade may continue to be held by the Fund, as long as such
securities do not exceed 5% of the portfolio, and will be sold only if the
manager believes it would be advantageous to do so.

It is anticipated that the average maturity of the fixed income obligations in
the Fund's portfolio will be between five and seven years.

The Fund will normally invest in the following equity securities, securities
convertible into equity securities, preferred stocks and warrants:

1. Domestic companies listed on an exchange or over-the-counter.

2. Foreign companies with shares listed on U.S. Exchanges or in the
over-the-counter market, or foreign companies with American Depository
Receipts (ADR's) which represent foreign securities and are traded on U.S.
Exchanges or in the over-the-counter market. The Fund may also invest directly
in foreign securities.

The Fund will not be restricted as to market capitalization. However, under
normal circumstances, the Fund will not invest more than 25% of its assets in
a single industry. Also the Fund may not own more than 10% of the outstanding
voting securities of a single issuer. The Fund may not invest more than 5% of
its equity assets in any one issuer.

Investments in money market securities shall include government securities,
government agency securities, commercial paper, bankers' acceptances, bank
certificates of deposit and repurchase agreements. Investment in commercial
paper is restricted to companies rated P-2 or higher by Moody's or A-2 or
higher by Standard & Poor's.

The Fund cannot guarantee that its investment objectives will be achieved
because there are inherent risks in the ownership of the investments made by
the Fund. The value of the Fund's shares will reflect changes in the market
value of its investments, and dividends paid by the Fund will vary with the
income it receives from these investments.

Through careful management and diversification, the Fund will seek to reduce
risk and enhance the opportunities for long-term growth of capital and income.
The flexibility to realize relative value between asset classes, markets and
individual securities offers investors the opportunity to access undervalued
securities around the globe. The total return approach employed by the Fund is
ideal for investors seeking to diversify assets and move money to areas of
attractive valuation.

Securities rated Baa or higher by Moody's or BBB by Standard & Poor's or
higher are classified as investment grade securities. Although securities
rated Baa by Moody's and BBB by Standard & Poor's have speculative
characteristics, they are considered to be investment grade. Such securities
carry a lower degree of risk than lower rated securities.

Securities that are subsequently downgraded in quality below Baa by Moody's or
BBB by Standard & Poor's may continue to be held by the Fund, and will be sold
only if the Fund's adviser believes it would be advantageous to do so. In
addition, the credit quality of unrated securities purchased by the Fund must
be, in the opinion of the Fund's adviser, at least equivalent to a Baa rating
by Moody's or a BBB rating by Standard & Poor's. Scout Balanced Fund's
annualized turnover ratio for the fiscal period ended June 30, 1996, it was
5%, and for the fiscal year ended June 30, 1997, it was 14%. Commissions paid
during the fiscal year ended June 30, 1997, amounted to $5,924.

REPURCHASE AGREEMENTS

A repurchase agreement involves the sale of securities to a Fund with the
concurrent agreement by the seller to repurchase the securities at the Fund's
cost plus interest at an agreed rate upon demand or within a specified time,
thereby determining the yield during the purchaser's period of ownership. The
result is a fixed rate of return insulated from market fluctuations during
such period. Under the Investment Company Act of 1940, repurchase agreements
are considered loans by the Funds.

The Funds will enter into such repurchase agreements only with United States
banks (including affiliates of UMB Financial Corporation) having assets in
excess of $1 billion which are members of the Federal Deposit Insurance
Corporation, and with certain securities dealers who meet the qualifications
set from time to time by the Board of Directors. In those cases where
securities issued by affiliate banks of UMB Financial Corporation are
purchased, no preference will be given to such issuers over other issuers. The
term to maturity of a repurchase agreement normally will be no longer than a
few days. Repurchase agreements maturing in more than seven days, and other
illiquid securities, will not exceed 10% of the total assets of any Fund.

RISK FACTORS

Risk Factors Applicable to Repurchase Agreements

The use of repurchase agreements involves certain risks. For example, if the
seller of the agreement defaults on its obligation to repurchase the
underlying securities at a time when the value of these securities has
declined, the Fund may incur a loss upon disposition of them. If the seller of
the agreement becomes insolvent and subject to liquidation or reorganization
under the Bankruptcy Code or other laws, disposition of the underlying
securities may be delayed pending court proceedings. Finally, it is possible
that the Fund may not be able to perfect its interest in the underlying
securities. While the Fund's management acknowledges these risks, it is
expected that they can be controlled through stringent security selection
criteria and careful monitoring procedures.

Risk Factors Peculiar to Money Market Instruments

The yield and the principal value of money market instruments are sensitive to
short-term lending conditions, and it is possible that an issuer may default.
The Fund will seek to minimize these risks through portfolio diversification,
careful portfolio selection among securities considered to be high quality and
by maintaining short average maturities.

Risk Factors Applicable to Concentration of Assets in the Banking Industry

Concentration of assets in the banking industry may increase the element of
risk because banks are highly leveraged. The manager believes this risk is
reduced because purchases will be limited to banks which are members of the
Federal Deposit Insurance Corporation, although securities purchased by the
Fund may not be F.D.I.C. insured deposits. Furthermore, the manager will
carefully evaluate the financial ratios and asset characteristics of banks in
which the Funds might invest, and reject those banks whose financial ratios
and asset characteristics are not, in the manager's opinion, sufficiently
strong.

Risk Factors Applicable to Foreign Investments

From time to time, Scout WorldWide Fund may invest in companies located in
developing countries. A developing country is generally considered to be a
country which is in the initial stages of its industrialization cycle with a
low per capita gross national product. Compared to investment in the United
States and other developed countries, investing in the equity and fixed income
markets of developing countries involves exposure to relatively unstable
governments, economic structures that are generally less mature and based on
only a few industries and securities markets which trade a small number of
securities. Prices on securities exchanges in developing countries generally
will be more volatile than those in developed countries. The Fund will not
invest more than 20% of its total assets in companies located in developing
countries.

The risks to which the Scout WorldWide Fund is exposed, as a result of
investing in companies located outside the United States include: currency
risks such as fluctuations in the value of foreign currencies and the
performance of foreign currencies relative to the U.S. dollar; exchange
control regulations; and costs incurred in connection with conversions between
various currencies (fees may also be incurred when converting foreign
investments to U.S. dollars). As a result, the relative strength of the U.S.
dollar may be an important factor in the performance of the Fund.

Under normal circumstances the Fund will invest at least 65% of its assets in
equity securities of foreign issuers. However, to meet the liquidity needs of
the Fund or when the Fund believes that investments should be deployed in a
temporary defensive posture because of economic or market conditions, the Fund
may invest all or a major portion of its assets in short-term debt securities
denominated in U.S. dollars, including U.S. treasury bills and other
securities of the U.S. government and its agencies, bankers' acceptances and
certificates of deposit rated "A" or better by Standard & Poor's Corporation
or Moody's Investors Service as well as enter into repurchase agreements
maturing in seven days or less with U.S. banks and broker-dealers which are
collateralized by such securities. The Fund may also hold cash and time
deposits in foreign banks, denominated in any major foreign currency.

INVESTMENT RESTRICTIONS

In addition to the policies set forth under the caption "Investment Objective
and Portfolio Management Policy" the Funds are subject to certain other
restrictions which may not be changed without approval of the "holders of a
majority of the outstanding shares" of the Fund or the affected Portfolio.
Among these restrictions, the more important ones are that the Fund
(Portfolio) will not purchase the securities of any issuer if more than 5% of
the Fund's total assets would be invested in the securities of such issuer, or
the Fund would hold more than 10% of any class of securities of such issuer;
borrow money in excess of 10% of total assets taken at market value, and then
only from banks as a temporary measure for extraordinary or emergency
purposes; will not borrow to increase income (leveraging) but only to
facilitate redemption requests which might otherwise require untimely
dispositions of portfolio securities; will repay all borrowings before making
additional investments (interest paid on such borrowings will reduce net
income). The full text of these restrictions is set forth in the "Statement of
Additional Information."

There is no limitation with respect to investments in U.S. Treasury Bills, or
other obligations issued or guaranteed by the federal government, its agencies
and instrumentalities.

PERFORMANCE MEASURES

From time to time, each of the Funds may advertise its performance in various
ways, as summarized below. Further discussion of these matters also appears in
the "Statement of Additional Information." A discussion of Scout Stock Fund,
Scout Regional Fund, Scout Bond Fund, Scout WorldWide Fund and Scout Balanced
Fund performance is included in the Fund's Annual Report to Shareholders which
is available from the Fund upon request at no charge.

Yield

From time to time, each portfolio of Scout Money Market Fund and Scout Tax-
Free Money Market Fund may advertise "yield" and "effective yield." The
"yield" of a Fund refers to the income generated by an investment in a Fund
over a seven-day period (which period will be stated in the advertisement).
This income is then "annualized." That is, the amount of income generated by
the 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 in a Fund is assumed to be reinvested. The "effective yield" will
be slightly higher than the "yield" because of the compounding effect of this
assumed reinvestment.

Each portfolio of Scout Money Market Fund, and Scout Tax-Free Money Market
Fund may quote their yields in advertisements or in reports to shareholders.
Yield information may be useful in reviewing the performance of these Funds
and in providing a basis for comparison with other investment alternatives.
However, since the net investment income of these Funds changes in response to
fluctuations in interest rates and Fund expenses, any given yield quotations
should not be considered representative of the Fund's yields for any future
period. Current yield and price quotations for the Scout Funds may be obtained
by telephoning 1-800-996-2862.

Total Return

Scout Stock Fund, Scout Regional Fund, Scout Bond Fund, Scout WorldWide Fund
and Scout Balanced Fund may advertise "average annual total return" over
various periods of time. Such total return figures show the average percentage
change in value of an investment in a Fund from the beginning date of the
measuring period to the end of the measuring period. These figures reflect
changes in the price of the Funds' shares and assume that any income dividends
and/or capital gains distributions made by the Funds during the period were
reinvested in shares of the Fund. Figures will be given for recent one-, five-
and ten-year periods (if applicable), and may be given for other periods as
well (such as from commencement of a Fund's operations, or on a year-by-year
basis). When considering "average" total return figures for periods longer
than one year, it is important to note that a Fund's annual total return for
any one year in the period might have been greater or less than the average
for the entire period.

Performance Comparisons

In advertisements or in reports to shareholders, each of the Funds may compare
its performance to that of other mutual funds with similar investment
objectives and to stock or other relevant indices. For example, Scout Stock,
Scout Regional, Scout WorldWide, Scout Bond and Scout Balanced Funds may
compare their performance to rankings prepared by Lipper Analytical Services,
Inc. (Lipper), a widely recognized independent service which monitors the
performance of mutual funds. Scout Stock Fund or Scout Regional Fund may also
compare its performance to the Standard & Poor's 500 Stock Index (S&P 500), an
index of unmanaged groups of common stocks, the Dow Jones Industrial Average,
a recognized unmanaged index of common stocks of 30 industrial companies
listed on the NYSE, or the Consumer Price Index. Scout Bond Fund may compare
its performance to the Shearson/ Lehman Government/ Corporate Index, an
unmanaged index of government and corporate bonds. Performance information,
rankings, ratings, published editorial comments and listings as reported in
national financial publications such as Kiplinger's Personal Finance Magazine,
Business Week, Morningstar Mutual Funds, Investor's Business Daily,
Institutional Investor, The Wall Street Journal, Mutual Fund Forecaster, No-
Load Investor, Money, Forbes, Fortune and Barron's may also be used in
comparing performance of Scout Stock Fund, Scout Regional Fund, Scout Bond
Fund, Scout WorldWide Fund and Scout Balanced Fund. Similarly, each Portfolio
of Scout Money Market Fund, and Scout Tax-Free Money Market Fund may compare
their yields to the Donoghue's Money Fund Average and the Donoghue's
Government Money Fund Average which are averages compiled by Donoghue's Money
Fund Report, a widely recognized independent publication that monitors the
performance of money market mutual funds, or to the average yield reported by
the Bank Rate Monitor for money market deposit accounts offered by the 50
leading banks and thrift institutions in the top five standard metropolitan
statistical areas. Performance comparisons should not be considered as
representative of the future performance of any Fund. Further information
regarding the performance of the Scout Funds is contained in the "Statement of
Additional Information."

Performance rankings, recommendations, published editorial comments and
listings reported in Money, Barron's, Kiplinger's Personal Finance Magazine,
Financial World, Forbes, U.S. News & World Report, Business Week, The Wall
Street Journal, Investors Business Daily, USA Today, Fortune and Stanger's may
also be cited (if the Fund is listed in any such publication) or used for
comparison, as well as performance listings and rankings from Morningstar
Mutual Funds, Personal Finance, Income and Safety, The Mutual Fund Letter, No-
Load Fund Investor, United Mutual Fund Selector, No-Load Fund Analyst, No-
Load Fund X, Louis Rukeyser's Wall Street newsletter, Donoghue's Money Letter,
CDA Investment Technologies, Inc., Wiesenberger Investment Companies Service
and Donoghue's Mutual Fund Almanac.

HOW TO PURCHASE SHARES

You must specify the Fund in which you desire to invest on your application
form. Failure to do so will result in the application and your check or bank
wire being returned to you.

Shares are purchased from the Fund at net asset value (no sales charge) next
computed after a purchase order has become effective, through its agent, Jones
& Babson, Inc., P.O. Box 410498, Kansas City, MO 64141-0498. For information
call toll free 1-800-996-2862. Purchase orders for Scout Funds become
effective upon receipt by the Fund.

The Funds reserve the right in their sole discretion to withdraw all or any
part of the offerings made by the prospectus or to reject purchase orders
when, in the judgment of management, such withdrawal or rejection is in the
best interest of a Fund and its shareholders. The Funds also reserve the right
at any time to waive or increase the minimum requirements applicable to
initial or subsequent investments with respect to any person or class of
persons, which includes shareholders of the Funds' special investment
programs. The Fund reserves the right to refuse to accept orders for fund
shares unless accompanied by payment, except when a responsible person has
indemnified the Fund against losses resulting from the failure of investors to
make payment. In the event that the Fund sustains a loss as the result of
failure by a purchaser to make payment, the Fund's underwriter, Jones &
Babson, Inc. will cover the loss.

INITIAL INVESTMENTS

Initial investments - By mail. You may open an account and make an investment
by completing and signing the application which accompanies this prospectus.
The minimum initial purchase is $1,000 unless your purchase is pursuant to an
IRA or the Uniform Transfers (Gifts) to Minors Act, in which case the minimum
initial purchase is $250. However, if electing the Automatic Monthly
Investment Plan, the minimum initial purchase is reduced to $100 for all
accounts. Make your check payable to UMB Bank, n.a. Mail your application and
check to:

The Scout Fund Group
P.O. Box 410498
Kansas City, MO 64141-0498

Initial investments - By wire. You may purchase shares of the Fund by wiring
the purchase price ($1,000 mini-mum) through the Federal Reserve Bank to the
custodian, UMB Bank, n.a. Prior to sending your money, you must call the Fund
toll free 1-800-996-2862 and provide it with the identity of the registered
account owner, the registered address, the Social Security or Tax
Identification Number of the registered owner, the amount being wired, the
name and telephone number of the wiring bank and the person to be contacted in
connection with the order. You will then be provided a Fund account number,
after which you should instruct your bank to wire the specified amount, along
with the account number and the account registration to:

UMB Bank, n.a.
Kansas City, Missouri, ABA #101000695
For: Scout Money Market Fund, Inc.
Prime Portfolio/AC = 980118-6957
Federal Portfolio/AC = 980118-6965
Scout Stock Fund, Inc./AC = 980118-7023
Scout Regional Fund, Inc./
AC = 987007-7108
Scout Bond Fund, Inc./AC = 980118-7015
Scout Tax-Free Money Market Fund, Inc./
AC = 980118-6981
Scout WorldWide Fund, Inc./AC= 987047-5332
Scout Balanced Fund, Inc./AC = 987072-6971
(as appropriate)

For Account No. (insert assigned Fund account number and name in which account
is registered).

A completed application must be sent to the Fund as soon as possible so the
necessary remaining information can be recorded in your account. Payment of
redemption proceeds will be delayed until the completed application is
received by the Fund.

INVESTMENTS SUBSEQUENT TO INITIAL INVESTMENT

You may add to your Fund account at any time in amounts of $100 or more if
purchases are made by mail or telephone purchase (ACH), or $500 or more if
purchases are made by wire. Automatic monthly investments must be in amounts
of $50 or more.

Checks should be mailed to the Funds at their address, but made payable to UMB
Bank, n.a. Always identify your account number or include the detachable
reminder stub which accompanies each confirmation.

Wire share purchases should include your account registration, your account
number and the Scout Fund in which you are purchasing shares. It also is
advisable to notify the Fund by telephone that you have sent a wire purchase
order to the bank.

TELEPHONE INVESTMENT SERVICE

To use the Telephone Investment Service, you must first establish your Fund
account and authorize telephone orders in the application form, or,
subsequently, on a special authorization form provided upon request. If you
elect the Telephone Investment Service and your request is received prior to
3:00 P.M. (Central Time), you may purchase Fund shares ($100 minimum) by
telephone and authorize the Fund to draft your checking account for the cost
of the shares so purchased. You will receive the next available price after
the Fund has received your telephone call. Availability and continuance of
this privilege is subject to acceptance and approval by the Fund and all
participating banks. During periods of increased market activity, you may have
difficulty reaching the Fund by telephone, in which case you should contact
the Fund by mail or telegraph. The Fund will not be responsible for the
consequences of delays, including delays in the banking or Federal Reserve
wire systems.

The Fund will employ reasonable procedures to confirm that instructions
communicated by telephone are genuine, and if such procedures are not
followed, the Fund may be liable for losses due to unauthorized or fraudulent
instructions. Such procedures may include, but are not limited to requiring
personal identification prior to acting upon instructions received by
telephone, providing written confirmations of such transactions, and/or tape
recording of telephone instructions.

The Funds reserve the right to initiate a charge for this service and to
terminate or modify any or all of the privileges in connection with this
service at any time upon 15 days written notice to shareholders, and to
terminate or modify the privileges without prior notice in any circumstances
where such termination or modification is in the best interest of the Fund and
its investors.

AUTOMATIC MONTHLY INVESTMENT PLAN

You may elect to make monthly investments in a constant dollar amount from
your checking account ($50 minimum, after an initial investment of $100 or
more for any account). The Fund will draft your checking account on the same
day each month in the amount you authorize in your application, or,
subsequently, on a special authorization form provided upon request.
Availability and continuance of this privilege is subject to acceptance and
approval by the Fund and all participating banks. If the date selected falls
on a day upon which the Fund shares are not priced, investment will be made on
the first date thereafter upon which Fund shares are priced. The Fund will not
be responsible for the consequences of delays, including delays in the banking
or Federal Reserve wire systems.

HOW TO REDEEM SHARES

Shareholders registered in the stock records of the Funds may withdraw all or
part of their investment by redeeming shares for which a Fund has received
unconditional payment in the form of federal funds or such payment has been
converted to federal funds and accepted by the Fund.

In each instance you must comply with the general requirements relating to all
redemptions as well as with specific requirements set out for the particular
redemption method you select. If you wish to expedite redemptions by using the
telephone/telegraph privilege, you should carefully note the special
requirements and limitations relating to these methods. Draft writing (check)
privileges are available for Scout Money Market Fund, Inc. and Scout Tax-Free
Money Market Fund, Inc.

All redemption requests must be transmitted to the Funds, P.O. Box 410498,
Kansas City, MO 64141-0498. Shareholders who have authorized telephone
redemption may call toll free 1-800-996-2862. The Funds will redeem shares at
the price (net asset value per share) next effective after receipt of a
redemption request in "good order." (See "How Share Price is Determined.")

The Funds will endeavor to transmit redemption proceeds to the proper party,
as instructed, as soon as practicable after a redemption request has been
received in "good order" and accepted, but in no event later than the third
business day thereafter. Transmissions are made by mail unless an expedited
method has been authorized and specified in the redemption request. The Fund
will not be responsible for the consequences of delays including delays in the
banking or Federal Reserve wire systems.

Redemptions will not become effective until all documents in the form required
have been received. In the case of redemption requests made within 15 days of
the date of purchase, the Fund will delay transmission of proceeds until such
time as it is certain that unconditional payment in federal funds has been
collected for the purchase of shares being redeemed or 15 days from the date
of purchase. You can avoid the possibility of delay by paying for all of your
purchases with a transfer of federal funds.

Where additional documentation is normally required to support redemptions as
in the case of corporations, fiduciaries, and others who hold shares in a
representative or nominee capacity such as certified copies of corporate
resolutions, or certificates of incumbency, or such other documentation as may
be required under the Uniform Commercial Code or other applicable laws or
regulations, it is the responsibility of the shareholder to maintain such
documentation on file and in a current status. A failure to do so will delay
the redemption. If you have questions concerning redemption requirements,
please write or telephone the Funds well ahead of an anticipated redemption in
order to avoid any possible delay.

Requests which are subject to special conditions or which specify an effective
date other than as provided herein cannot be accepted.

The right of redemption may be suspended or the date of payment postponed
beyond the normal three-day period when the New York Stock Exchange is closed
or under emergency circumstances as determined by the Securities and Exchange
Commission. Additional details are set forth in the "Statement of Additional
Information."

With respect to Scout Money Market and Scout Tax-Free Money Market Funds,
shares redeemed will be entitled to receive all dividends declared through the
day preceding the date of redemption. If you redeem all of the shares in your
account, in addition to the share redemption check, a separate check
representing all dividends declared but unpaid on the shares redeemed will be
distributed on the next dividend payment date. Any amount due you in your
declared but unpaid dividend account cannot be redeemed by draft.

Due to the high cost of maintaining smaller accounts, the Directors have
authorized the Funds to close shareholder accounts where their value falls
below the current minimum initial investment requirement at the time of
initial purchase as a result of redemptions and not as the result of market
action, and remains below this level for 60 days after each such shareholder
account is mailed a notice of: (1) the Fund's intention to close the account,
(2) the minimum account size requirement, and (3) the date on which the
account will be closed if the minimum size requirement is not met. Since the
minimum investment amount and the minimum account size are the same, any
redemption from an account containing only the minimum investment amount may
result in redemption of that account.

Withdrawal By Mail - Shares may be redeemed by mailing your request to the
Funds. To be in "good order" the request must include the following:

(1) A written redemption request or stock assignment (stock power)
containing the genuine signature of each registered owner exactly as the
shares are registered, with clear identification of the account by registered
name(s), account number and the number of shares or the dollar amount to be
redeemed;

(2) any outstanding stock certificates representing shares to be
redeemed;

(3) signature guarantees as required (see Signature Guarantees); and

(4) any additional documentation which the Fund may deem necessary to
insure a genuine redemption such as an application if one is not on file, or
in the case of corporations, fiduciaries, and others who hold shares in a
representative or nominee capacity (see below).

Where additional documentation is normally required to support redemptions as
in the case of corporations, fiduciaries, and others who hold shares in a
representative or nominee capacity, such as certified copies of corporate
resolutions, or certificates or incumbency, or such other documentation as may
be required under the Uniform Commercial Code or other applicable laws or
regulations, it is the responsibility of the shareholder to maintain such
documentation on file and in a current status. A failure to do so will delay
the redemption. If you have questions concerning redemption requirements,
please write or telephone the Fund well ahead of an anticipated redemption in
order to avoid any possible delay.

Signature Guarantees are required in connection with all redemptions of
$50,000 or more by mail, or changes in share registration, except as
hereinafter provided. These requirements may be waived by the Fund in certain
instances where it appears reasonable to do so and will not unduly affect the
interests of other shareholders. Signature(s) must be guaranteed by an
"eligible Guarantor institution" as defined in Rule 17Ad-15 under the
Securities Exchange Act of 1934. Eligible guarantor institutions include: (1)
national or state banks, savings associations, savings and loan associations,
trust companies, savings banks, industrial loan companies and credit unions;
(2) national securities exchanges, registered securities associations and
clearing agencies; or (3) securities broker/dealers which are members of a
national securities exchange or clearing agency or which have a minimum net
capital of $100,000. A notarized signature will not be sufficient for the
request to be in proper form.

Signature guarantees will be waived for mail redemptions of $50,000 or less,
but they will be required if the checks are to be payable to someone other
than the registered owner(s), or are to be mailed to an address different from
the registered address of the shareholder(s), or where there appears to be a
pattern of redemptions designed to circumvent the signature guarantee
requirement, or where the Funds have other reason to believe that this
requirement would be in the best interests of the Funds and their
shareholders.

Withdrawal By Telephone or Telegraph - You may withdraw any amount ($500
minimum if wired) or more by telephone toll free 1-800-996-2862, or by
telegram to the Fund's address. Telephone/telegraph redemption authorizations
signed by all registered owners with signatures guaranteed must be on file
with the Funds before you may redeem by telephone or telegraph. Funds will be
sent only to the address of record. The signature guarantee requirement may be
waived by the Funds if the request for this redemption method is made at the
same time the initial application to purchase shares is submitted.

All communications must include the Fund's name, Portfolio name (if
applicable), your account number, the exact registration of your shares, the
number of shares or dollar amount to be redeemed, and the identity of the bank
and bank account (name and number) to which the proceeds are to be wired. This
procedure may only be used for non-certificated shares held in open account.
For the protection of shareholders, your redemption instructions can only be
changed by filing with the Funds new instructions on a form obtainable from
the Funds which must be properly signed with signature(s) guaranteed.

Telephone or telegraph redemption proceeds may be transmitted to your pre-
identified bank account either by wire or mail to a domestic commercial bank
which is a member of the Federal Reserve System, or by credit to such account
with UMB Bank, n.a. as designated by you on your pre-authorization form. If
you elect to have proceeds wired to a bank other than UMB Bank, n.a., and your
request is received prior to 1:00 P.M. (Central Time) for Scout Money Market
Fund, Inc. and Scout Tax-Free Money Market Fund, Inc. or 3:00 P.M. (Central
Time) for Scout Stock Fund, Inc., Scout Regional Fund, Inc., Scout Balanced
Fund, Inc., Scout Bond Fund, Inc. and Scout WorldWide Fund, Inc., proceeds
normally will be wired the following business day. Once the funds are
transmitted, the time of receipt and the funds' availability are not under our
control. If your request is received on any day after the cut-off time,
proceeds normally will be wired on the second business day following the day
of receipt of your request. If you elect to have proceeds credited to your
account with UMB Bank, n.a., and your request is received prior to 1:00 P.M.
(Central Time) for Scout Money Market Fund, Inc. and Scout Tax-Free Money
Market Fund, Inc. only, proceeds normally will be credited that day. Normally,
your bank account with UMB Bank, n.a. will be credited on the following
business day if your request for Scout Money Market Fund, Inc. and Scout Tax-
Free Money Market Fund, Inc. is received after 1:00 P.M. (Central Time).
Normally your bank account with UMB Bank, n.a. will be credited on the
following business day for all requests for Scout Stock Fund, Inc., Scout Bond
Fund, Inc., Scout Regional Fund, Inc., Scout WorldWide Fund, Inc. and Scout
Balanced Fund, Inc. The Funds reserve the right to change their policy or to
refuse a telephone or telegraph redemption request or require additional
documentation to assure a genuine redemption, and, at their option, may pay
such redemption by wire or check and may limit the frequency or the amount of
such request. The Funds reserve the right to terminate or modify any or all of
the services in connection with this privilege at any time without prior
notice. Neither the Funds nor Jones & Babson, Inc. assumes responsibility for
the authenticity of withdrawal instructions, and there are provisions on the
authorization form limiting their liability in this respect.

Withdrawal by Draft ("Check") - (SCOUT MONEY MARKET AND SCOUT TAX-FREE MONEY
MARKET FUNDS ONLY) - you may elect this method of redemption on your original
application, or on a form which will be sent to you upon request. All
signatures must be guaranteed unless this method of redemption is elected on
your original application. The authorization form, which all registered owners
must sign, also contains a provision relieving the Funds, Jones & Babson, Inc.
and UMB Bank, n.a. from liability for loss, if any, which you may sustain
arising out of a non-genuine redemption pursuant to this redemption feature.
Any additional documentation required to assure a genuine redemption must be
maintained on file with the Funds in such a current status as the Funds may
deem necessary. A new form properly signed and with the signature(s)
guaranteed must be received and accepted by the Funds before authorized
redemption instructions already on file with the Funds can be changed.

You will be provided a supply of drafts ("checks") which may be drawn on the
Funds. Drafts must be deposited in a bank account of the payee to be cleared
through the banking system in order to be presented to the Funds for payment
through UMB Bank, n.a. An additional supply of drafts will be furnished upon
request. There presently is no charge for these drafts or their clearance.
However, the Funds and UMB Bank, n.a. reserve the right to make reasonable
charges and to terminate or modify any or all of the services in connection
with this privilege at any time and without prior notice.

These drafts may be signed by any joint owner unless otherwise indicated on
the account application. They may be made payable to the order of any person
in the amount of $500 or more. The bank of the draft payee must present it for
collection through UMB Bank, n.a. which delivers it to the Fund for redemption
of a sufficient number of shares to cover the amount of the draft. Dividends
will be earned by the shareholder on the draft proceeds until the day
preceding the date it clears at UMB Bank, n.a. Drafts will not be honored by
the Funds and will be returned unpaid if there are insufficient open account
shares to meet the withdrawal amount. The Funds reserve the right to withhold
the bank's redemption request until they determine that they have received
unconditional payment for at least the number of shares required to be
redeemed to make payment on the draft. If such a delay is necessary, the bank
may return the draft not accepted (by the Funds) because there are not
sufficient shares for which good payment has been received in the shareholder
account. Dividends declared but not yet paid to you cannot be withdrawn by
drafts. Drafts (checks) may not be used as a redemption form.

SYSTEMATIC REDEMPTION PLAN

If you own shares in an open account valued at $10,000 or more, and desire to
make regular monthly or quarterly withdrawals without the necessity and
inconvenience of executing a separate redemption request to initiate each
withdrawal, you may enter into a Systematic Withdrawal Plan by completing
forms obtainable from the Fund. For this service, the manager may charge you a
fee not to exceed $1.50 for each withdrawal. Currently the manager assumes the
additional expenses arising out of this type of plan, but it reserves the
right to initiate such a charge at any time in the future when it deems it
necessary. If such a change is imposed, participants will be provided 30 days
notice.

Subject to a $50 minimum, you may withdraw each period a specified dollar
amount. Shares also may be redeemed at a rate calculated to exhaust the
account at the end of a specified period of time.

Dividends and capital gains distributions must be reinvested in additional
shares. Under all withdrawal programs, liquidation of shares in excess of
dividends and distributions reinvested will diminish and may exhaust your
account, particularly during a period of declining share values.

You may revoke or change your plan or redeem all of your shares remaining at
any time. Withdrawal payments will be continued until the shares are exhausted
or until the Fund or you terminate the plan by written notice to the other.

HOW TO EXCHANGE SHARES BETWEEN SCOUT FUNDS

Shareholders may exchange their Fund shares which have been held in open
account for 15 days or more, and for which good payment has been received, for
identically registered shares of any other Scout Fund, or any other Portfolio
in the Scout Fund Group, which is legally registered for sale in the state of
residence of the investor, provided that the minimum amount exchanged from a
Fund or Portfolio has a value of $1,000 or more and meets the minimum
investment requirement of the Fund or Portfolio into which it is exchanged. An
exchange between two Scout Funds is treated as a sale of the shares from which
the exchange occurs and a purchase of shares of the fund into which the
exchange occurs. Exchanging shareholders will receive the next quoted prices
for their shares after the request is received in "good order." (See "How
Share Price is Determined.")

To authorize the Telephone/Telegraph Exchange Privilege, all registered owners
must authorize this privilege on the original application, or the Fund must
receive a special authorization form, provided upon request. During periods of
increased market activity, you may have difficulty reaching the Fund by
telephone, in which case you should contact the Fund by mail or telegraph. The
Fund reserves the right to initiate a charge for this service and to terminate
or modify any or all of the privileges in connection with this service at any
time and without prior notice under any unforeseen circumstances where
continuance of these privileges would be detrimental to the Fund or its
shareholders such as an emergency, or where the volume of such activity
threatens the ability of the Fund to conduct business, or under any other
circumstances, upon 60 days written notice to shareholders. The Fund will not
be responsible for the consequences of delays including delays in the banking
or Federal Reserve wire systems.

Exchanges by mail may be accomplished by a written request properly signed by
all registered owners identifying the account by name and number, the number
of shares or dollar amount to be redeemed for exchange, and the Scout Fund
into which the account is being transferred.

If you wish to exchange part or all of your shares in any Fund for shares of
another Fund or Portfolio in the Scout Fund Group, you should review the
prospectus carefully. Any such exchange will be based upon the respective net
asset values of the shares involved. An exchange between Funds involves the
sale of an asset. Unless the shareholder account is tax-deferred, this is a
taxable event.

HOW SHARE PRICE IS DETERMINED

The net asset value per share of each Fund (Portfolio) is computed once daily,
Monday through Friday, at the specific time during the day that the Board of
Directors of each Fund sets at least annually, except on days on which changes
in the value of a Fund's portfolio securities will not materially affect the
net asset value, or days during which no security is tendered for redemption
and no order to purchase or sell such security is received by the Fund, or
customary holidays. For a list of the holidays during which any of the Funds
are not open for business, see "How Share Price is Determined" in the
"Statement of Additional Information."

The per share calculation is made by subtracting from total assets any
liabilities and then dividing this net amount by the total outstanding shares
as of the date of the calculation.

Stock, Regional, Bond, WorldWide and Balanced Funds

The price at which new shares of Scout Stock Fund, Scout Regional Fund, Scout
Bond Fund, Scout WorldWide Fund and Scout Balanced Fund will be sold and at
which issued shares presented for redemption will be liquidated is computed
once daily at 3:00 P.M. (Central Time), except on those days when these Funds
are not open for business.

Money market securities which on the date of valuation have 60 days or less to
maturity, are valued on the basis of the amortized cost valuation technique
which involves valuing a security at its cost and thereafter assuming a
constant amortization to maturity of any discount or premium, regardless of
the impact of fluctuating interest rates on the market value of the
instrument.

For Scout Stock Fund, Scout Regional Fund, Scout WorldWide Fund and Scout
Balanced Fund, each security listed on an Exchange is valued at its last sale
price on that Exchange on the date as of which assets are valued. Where the
security is listed on more than one Exchange, the Fund will use the price of
that Exchange which is generally considered to be the principal Exchange on
which the stock is traded. Lacking sales, the security is valued at the mean
between the current closing bid and asked prices. An unlisted security for
which over-the-counter market quotations are readily available is valued at
the mean between the last current bid and asked prices. When market quotations
are not readily available, any security or other asset is valued at its fair
value as determined in good faith by the Board of Directors.

For Scout Bond Fund, debt securities (other than short-term obligations),
including listed issues, are valued on the basis of valuations furnished by a
pricing service which utilizes both dealer-supplied valuations and electronic
data processing techniques which take into account appropriate factors such as
institution-size trading in similar groups of securities, yield, quality,
coupon rate, maturity, type of issue, trading characteristics and other market
data, without exclusive reliance upon exchange or over-the-counter prices,
since such valuations are believed to reflect more accurately the fair value
of such securities. Use of the pricing service has been approved by Scout Bond
Fund's Board of Directors.

Money Market and Tax-Free Money Market Funds

The price at which new shares of each Portfolio of Scout Money Market Fund and
Scout Tax-Free Money Market Fund will be sold and at which issued shares
presented for redemption will be liquidated is computed once daily at 12:00
P.M. (Central Time), except on those days when these Funds are not open for
business.

Normally the price of each Portfolio of Scout Money Market Fund and the price
of Scout Tax-Free Money Market Fund will be $1.00 because these Funds will
adhere to a number of procedures designed, but not guaranteed, to maintain a
constant price of $1.00 per share. Although unlikely, it still is possible
that the value of the shares you redeem may be more or less than your cost
depending on the market value of these Funds' securities at the time a
redemption becomes effective.

For the purpose of calculating each Fund's net asset value per share,
securities are valued by the "amortized cost" method of valuation, which does
not take into account unrealized gains or losses. This involves valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium regardless of the impact of fluctuating
interest rates on the market value of the instrument. While this method
provides certainty in valuation, it may result in periods during which value,
as determined by amortized cost, is higher or lower than the price the Fund
would receive if it sold the instrument. During periods of declining interest
rates, the daily yield on shares of the Funds computed as described above may
tend to be higher than a like computation made by a fund with identical
investments utilizing a method of valuation based upon market prices and
estimates of market prices for its portfolio instruments. Thus, if the use of
amortized cost by the Funds resulted in a lower aggregate value on a
particular day, a prospective investor in the Funds would be able to obtain a
somewhat higher yield than would result from investment in a fund utilizing
market values, and existing investors would receive less investment income.
The converse would apply in a period of rising interest rates.

The use of amortized cost and the maintenance of each Fund's per share net
asset value at $1.00 is based on its election to operate under the provisions
of Rule 2a-7 under the Investment Company Act of 1940. To assure compliance
with adopted procedures pursuant to Rule 2a-7 under the Investment Company Act
of 1940 (the "1940 Act"), the Fund will only invest in U.S. dollar denominated
securities with remaining maturities of 397 days or less, maintain the dollar
weighted average maturity of the securities in the Fund's portfolio at 90 days
or less and limit its investments to those instruments which the Directors of
the Fund determines present minimal credit risks and which are eligible
investments under the rule.

The Directors have established procedures designed to maintain the Funds'
price per share, as computed for the purpose of sales and redemptions, at
$1.00. These procedures include a review of the Funds' holdings by the
Directors at such intervals as they deem appropriate to determine whether the
Funds' net asset value calculated by using available market quotations
deviates from $1.00 per share based on amortized cost. If any deviation
exceeds one-half of one percent, the Directors will promptly consider what
action, if any, will be initiated. In the event the Directors determine that a
deviation exists which may result in material dilution or other unfair results
to investors or existing shareholders, they have agreed to take such
corrective action as they regard as necessary and appropriate, including the
sale of portfolio instruments prior to maturity to realize capital gains or
losses or to shorten average portfolio maturity; withhold dividends; make a
special capital distribution; redeem shares in kind; or establish net asset
value per share using available market quotations.

There are various methods of valuing the assets and of paying dividends and
distributions from a money market fund. Each Portfolio values its assets at
amortized cost while also monitoring the available market bid prices, or yield
equivalents. Since dividends from net investment income will be accrued daily
and paid monthly, the net asset value per share of each Portfolio will
ordinarily remain at $1.00, but the Portfolio's daily dividends will vary in
amount.

OFFICERS AND DIRECTORS

The officers of the Funds manage their day-to-day operations. The Funds'
manager and officers are subject to the supervision and control of the Boards
of Directors. A list of the officers and directors of the Funds and a brief
statement of their present positions and principal occupations during the past
five years is set forth in the "Statement of Additional Information."

MANAGER AND UNDERWRITER

Jones & Babson, Inc. was founded in 1960. It organized Scout Stock, Bond,
Money Market and Tax-Free Money Market Funds in 1982, Scout Regional Fund in
1986, Scout WorldWide Fund in 1993, and Scout Balanced Fund in 1995, and acts
as their principal underwriter at no cost to the Funds.

UMB Bank, n.a. is the Fund's manager and investment adviser and provides or
pays the cost of all management, supervisory and administrative services
required in the normal operation of the Funds. This includes investment
management and supervision; fees of the custodian, independent public
accountants and legal counsel; remuneration of officers, directors and other
personnel; rent; shareholder services, including the maintenance of the
shareholder accounting system and transfer agency; and such other items as are
incidental to corporate administration.

Not considered normal operating expenses and therefore payable by the Funds,
are taxes, fees and other charges of governments and their agencies including
the cost of qualifying the Funds' shares for sale in any jurisdiction,
interest, brokerage costs, and all costs and expenses including legal and
accounting fees incurred in anticipation of or arising out of litigation or
administrative proceedings to which the Funds, their officers or directors may
be subject or a party thereto. Per share expenses of any Portfolio or Fund may
differ due to differences in management or registration fees.

Jones & Babson, Inc. acts as principal underwriter for the Funds at no cost to
the Funds. UMB Bank, n.a. employs at its own expense Jones & Babson, Inc. to
provide services to the Funds, including the maintenance of the shareholder
accounting system and transfer agency, and such other items as are incidental
to corporate administration. The cost of the services of Jones & Babson, Inc.
is included in the fee of UMB Bank, n.a.

As compensation for all the foregoing services, Scout Stock Fund, Scout
Regional Fund, Scout Bond Fund, Scout WorldWide Fund and Scout Balanced Fund
pay UMB Bank, n.a. a fee at the annual rate of 85/100 of one percent (.85%) of
their total net assets, which is computed daily and paid semimonthly.

The total expenses of Scout Stock Fund for the fiscal year ended June 30,
1997, amounted to .86% of the average net assets of that Fund which included
the following amounts paid to UMB Bank, n.a.: $88,867 for custodian services,
$1,135,180 for advisory services and $88,867 for portfolio accounting
services. The total expenses of Scout Bond Fund for the fiscal year ended June
30, 1997, amounted to .87% of the average net assets of that Fund which
included the following amounts paid to UMB Bank, n.a.: $39,990 for custodian
services, $485,577 for advisory services and $39,990 for portfolio accounting
services. The total expenses of Scout Regional Fund for the fiscal year ended
June 30, 1997, amounted to .87% of the average net assets of that Fund which
included the following amounts paid to UMB Bank, n.a.: $22,849 for custodian
services, $270,392 for advisory services and $22,849 for portfolio accounting
services. The total expenses of Scout WorldWide Fund for the fiscal year ended
June 30, 1997, amounted to .86% of the average net assets of that Fund which
included the following amounts paid to UMB Bank, n.a.: $19,806 for custodian
services, $231,245 for advisory services, and $19,806 for portfolio accounting
services. The total expenses of Scout Balanced Fund for the fiscal year ended
June 30, 1997, amounted to .85% of the average net assets of that Fund which
included the following amounts paid to UMB Bank, n.a.: $3,393 for custodian
services, $15,998 for advisory services, and $3,393 for portfolio accounting
services.

Scout Money Market Fund and Scout Tax-Free Money Market Fund pay UMB Bank,
n.a. a fee at the annual rate of 50/100 of one percent (.50%) of their total
net assets, which is computed daily and paid semimonthly. The total expenses
of the Federal Portfolio of Scout Money Market Fund for the fiscal year ended
June 30, 1997, amounted to .52% of the average net assets of the Portfolio
which included the following amounts paid to UMB Bank, n.a.: $131,961 for
custodian services, $824,857 for advisory services, and $131,961 for portfolio
accounting services. The total expenses of the Prime Portfolio of Scout Money
Market Fund for the fiscal year ended June 30, 1997, amounted to .51% of the
average net assets of the Portfolio which included the following amounts paid
to UMB Bank, n.a.: $200,732 for custodian services, $1,255,737 for advisory
services, and $200,732 for portfolio accounting services. The total expenses
of Scout Tax-Free Money Market Fund for the fiscal year ended June 30, 1997,
amounted to .55% of the average net assets of the Fund which included the
following amounts paid to UMB Bank n.a.: $64,313 for custodian services,
$390,316 for advisory services, and $64,313 for portfolio accounting services.

The annual fees charged by UMB Bank, n.a. are higher than the fees of most
other investment advisers whose charges cover only investment advisory
services with all remaining operational expenses absorbed directly by the
Fund, but it is anticipated that they will compare favorably with these other
advisers when all expenses to Fund shareholders are taken into account.

The Bank serves a broad variety of individual, corporate and other
institutional clients by maintaining an extensive research and analytical
staff. It has an experienced investment analysis and research staff which
eliminates the need for the Fund to maintain an extensive duplicate staff,
with the consequent increase in the cost of investment advisory service.

The Management Agreement limits the liability of the manager, as well as its
officers, directors and personnel, to acts or omissions involving willful
malfeasance, bad faith, gross negligence, or reckless disregard of their
duties.

David B. Anderson has been the portfolio manager of Scout Stock Fund since
1982, and portfolio manager of Scout Regional Fund since the change in the
Fund's objective in 1991. He joined UMB Investment Advisors in 1979, and has
25 years of investment management experience. Eric Kelley has been the
portfolio manager of Scout Tax-Free Money Market Fund since 1996. He joined
UMB Investment Advisors in 1995, and has over six years of investment
management experience. James L. Moffett has been the portfolio manager of
Scout WorldWide Fund since its inception in September, 1993. He is a Chartered
Financial Analyst. He joined UMB Bank Kansas (previously Commercial National
Bank) in 1979, and has more than 29 years of experience in investment
management. William A. Faust has been the portfolio manager of both the
Federal and Prime Portfolios of Scout Money Market Fund since 1995. He joined
UMB Investment Advisors in 1983, and has over 26 years of investment
management experience. George W. Root has been the portfolio manager of Scout
Bond Fund since 1982. He joined UMB Investment Advisors in 1978, and has 21
years of investment management experience. Christopher P. Bloomstran has been
the portfolio manager of Scout Balanced Fund since its inception. He is a
Chartered Financial Analyst with over eight years of experience.

Certain officers and directors of each Fund are also officers or directors or
both of other Scout Funds or Jones & Babson, Inc.

Jones & Babson, Inc. is a wholly-owned subsidiary of Business Men's Assurance
Company of America, which is considered to be a controlling person under the
Investment Company Act of 1940. Assicurazioni Generali S.p.A., an insurance
organization founded in 1831 based in Trieste, Italy, is considered to be a
controlling person and is the ultimate parent of Business Men's Assurance
Company of America. Mediobanca is a 5% owner of Generali.

The current Management Agreements between the Funds and UMB Bank, n.a. have
been approved by the Funds' shareholders, will continue in effect until
October 31, 1998, and will continue automatically for successive annual
periods ending each October 31 so long as such continuance is specifically
approved at least annually by the Boards of Directors of the Funds or by a
vote of the majority of the outstanding voting securities of the Funds, and,
provided also that such continuance is approved by the vote of a majority of
the Directors who are not parties to the Agreements or interested persons of
any such party at a meeting held in person and called specifically for the
purpose of evaluating and voting on such approval. All of the Agreements
provide that either party may terminate by giving the other 60 days written
notice. The Agreements terminate automatically if assigned by either party, as
required under the Investment Company Act of 1940.

GENERAL INFORMATION AND HISTORY

Scout Stock Fund and Scout Bond Fund, both of which were incorporated in
Maryland on July 29, 1982, as UMB Stock Fund, Inc. and UMB Bond Fund, Inc.,
have present authorized capitalization of 20,000,000 shares of $1 par value
common stock. Scout Regional Fund, which was incorporated in Maryland on July
11, 1986, as UMB Qualified Dividend Fund, Inc., and changed its name to UMB
Heartland Fund, Inc. on July 30, 1991, Scout WorldWide Fund which was
incorporated in Maryland on January 7, 1993, as UMB WorldWide Fund, Inc., and
Scout Balanced Fund, Inc., which was incorporated on July 13, 1995, each have
a present authorized capitalization of 10,000,000 shares of $1 par value
common stock. All shares of each Fund are of the same class with like rights
and privileges. Each full and fractional share, when issued and outstanding,
has: (1) equal voting rights with respect to matters which affect the Fund,
and (2) equal dividend, distribution and redemption rights to the assets of
the Fund. Shares when issued are fully paid and non-assessable. The Funds will
not issue any senior securities. Shareholders do not have pre-emptive or
conversion rights. The Funds may issue additional series of stock with the
approval of the Fund's Board of Directors.

Scout Money Market Fund, incorporated in Maryland on June 23, 1982, as UMB
Money Market Fund, Inc., has a present authorized capitalization of
1,500,000,000 shares of $.01 par value common stock. One-half of the shares
are presently reserved for issuance to shareholders invested in the Federal
Portfolio and one-half is reserved for the Prime Portfolio shareholders. Each
full and fractional share, when issued and outstanding, has: (1) equal voting
rights with respect to matters which affect the Fund in general and with
respect to matters relating solely to the interests of the Portfolio for which
issued, and (2) equal dividend, distribution and redemption rights to the
assets of the Portfolio for which issued and to general assets, if any, of the
Fund which are not specifically allocated to a particular Portfolio. Shares
when issued are fully paid and non-assessable. Except for the priority of each
share in the assets of its Portfolio, the Fund will not issue any class of
securities senior to any other class. Shareholders do not have pre-emptive or
conversion rights. The Fund may issue additional series of stock with the
approval of the Fund's Board of Directors.

Scout Tax-Free Money Market Fund, incorporated in Maryland on July 29, 1982 as
UMB Tax-Free Money Market Fund, Inc., has a present authorized capitalization
of 1,000,000,000 shares of $.01 par value common stock. All shares are of the
same class with like rights and privileges. Each full and fractional share,
when issued and outstanding, has: (1) equal voting rights with respect to
matters which affect the Fund, and (2) equal dividend, distribution and
redemption rights to the assets of the Fund. Shares when issued are fully paid
and non-assessable. The Fund will not issue any senior securities.
Shareholders do not have pre-emptive or conversion rights. The Fund may issue
additional series of stock with the approval of the Fund's Board of Directors.

Non-cumulative voting - All of the Funds' shares have non-cumulative voting
rights, which means that the holders of more than 50% of the shares voting for
the election of directors can elect 100% of the directors, if they choose to
do so, and in such event, the holders of the remaining less than 50% of the
shares voting will not be able to elect any directors.

The Maryland Statutes permit registered investment companies, such as the
Funds, to operate without an annual meeting of shareholders under specified
circumstances if an annual meeting is not required by the Investment Company
Act of 1940. There are procedures whereby the shareholders may remove
directors. These procedures are described in the "Statement of Additional
Information" under the caption "Officers and Directors." The Funds have
adopted the appropriate provisions in their By-Laws and will not hold annual
meetings of shareholders for the following purposes unless required to do so:
(1) election of directors; (2) approval of any investment advisory agreement;
(3) ratification of the selection of independent public accountants; and (4)
approval of a distribution plan. As a result, the Fund does not intend to hold
annual meetings.

Federal Banking Laws - The Glass-Steagall Act is a federal law that prohibits
national banks from sponsoring, distributing or controlling a registered open-
end investment company. It is possible that certain activities of UMB Bank,
n.a. relating to the Funds may be claimed to be comparable to the matters
covered by such provisions. It is not expected that any conclusions regarding
such activities of UMB Bank, n.a. would have any material effect on the assets
of the Funds or their shareholders, because the Fund's distribution is under
the control of Jones & Babson, Inc., the Funds' distributor, which is not
subject to the Glass-Steagall Act. Although it is not anticipated that
decisions under the Glass-Steagall Act adverse to UMB Bank, n.a. would have
any material effect on the conduct of the Fund's operations, if any
unanticipated changes affecting the Fund's operations were deemed appropriate,
the Board of Directors would promptly consider suitable adjustments.

The Funds may use the name "Scout" in its name so long as UMB Bank, n.a. is
continued as its manager. Complete details with respect to the use of the name
are set out in a licensing agreement between the Funds, Jones & Babson, Inc.
and UMB Bank, n.a.

This prospectus omits certain of the information contained in the registration
statement filed with the Securities and Exchange Commission, Washington, D.C.
These items may be inspected at the offices of the Commission or obtained from
the Commission upon payment of the fee prescribed.

In the opinion of the staff of the Securities and Exchange Commission, the use
of this combined prospectus may possibly subject all Funds to a certain amount
of liability for any losses arising out of any statement or omission in this
prospectus regarding a particular Fund. In the opinion of the Funds'
management, however, the risk of such liability is not materially increased by
the use of a combined prospectus.

DIVIDENDS, DISTRIBUTIONS AND THEIR TAXATION

Scout Stock Fund, Inc., Scout Regional Fund, Inc., Scout WorldWide Fund,
Inc., and Scout Balanced Fund, Inc. will pay substantially all of their net
income semiannually, usually in June and December. It is contemplated that
substantially all of any net capital gains realized during a fiscal year will
be distributed with the fiscal year-end dividend, with any remaining balance
paid in December. Dividends and capital gains distributions will be reinvested
automatically in additional shares at the net asset value per share next
computed and effective at the close of business on the day after the record
date, unless the shareholder has elected on the original application or by
written instructions filed with the Fund, to have them paid in cash.

In the case of Scout Tax-Free Money Market Fund, Inc. and each Portfolio of
Scout Money Market Fund, Inc., at the close of each business day, dividends
consisting of substantially all of each Portfolio's net investment income are
declared payable to shareholders of record at the close of that day, and
credited to their accounts. All daily dividends declared during a given month
will be distributed on the last day of the month.

In the case of Scout Bond Fund, at the close of each business day, dividends
consisting of substantially all of the Fund's net investment income are
declared payable to shareholders of record at the close of the previous
business day, and credited to their accounts. All daily dividends declared
during a given month will be distributed on the last day of the month. It is
contemplated that substantially all of any net capital gains realized during a
fiscal year will be distributed with the fiscal year-end dividend, with any
remaining balance paid in December. Dividends and capital gains distributions
will be reinvested automatically in additional shares at the net asset value
per share next computed and effective at the close of business on the day
after the record date, unless the shareholder has elected on the original
application or by written instructions filed with the Fund, to have them paid
in cash.

Each Fund and each Portfolio of Scout Money Market Fund has qualified and
intends to continue to qualify each year as "a regulated investment company"
under the Internal Revenue Code so that each Fund (or Portfolio) will not be
subject to federal income tax to the extent it distributes its income to its
shareholders. Dividends, either in cash or reinvested in shares, paid by the
Funds from net investment income will be taxable to shareholders as ordinary
income. In the case of Scout Stock Fund and Scout Regional Fund, dividends
paid by such Funds will generally qualify in part for the 70% dividends-
received deduction for corporations, but the portion of the dividends so
qualified depends on the aggregate taxable qualifying dividend income received
by such Fund from domestic (U.S.) sources. Each Fund will send to shareholders
a statement each year advising the amount and treatment of the dividend
income.

Dividends and capital gains distributions, if any, are automatically
reinvested in additional shares at net asset value, unless the shareholder has
elected in writing to receive cash. The method of payment elected remains in
effect until the Fund is notified in writing to the contrary. If at the time
of a complete redemption and closing of a shareholder account, there is net
undistributed income to the credit of the shareholder, it will be paid by
separate check on the next dividend distribution date. In the case of a
partial redemption, any net undistributed credit will be distributed on the
next dividend date according to the shareholder's instructions on file with
the Fund.

Whether paid in cash or additional shares of a Fund, and regardless of the
length of time Fund shares have been owned by the shareholder, distributions
from long-term capital gains are taxable to shareholders as such, but are not
eligible for the dividends-received deduction for corporations. Shareholders
are notified annually by each Fund as to federal tax status of dividends and
distributions paid by the Fund. In the case of Scout Tax-Free Money Market
Fund, shareholders who have not been in such Fund for a full fiscal year may
have designated as tax-exempt a percentage of income which is not equivalent
to the actual amount applicable to the period for which they have held the
shares. Such dividends and distributions may also be subject to state and
local taxes.

Exchange and redemption of Fund shares are taxable events for federal income
tax purposes. Shareholders may also be subject to state and municipal taxes on
such exchanges and redemptions. You should consult your tax adviser with
respect to the tax status of distributions from the Fund in your state and
locality.

The Funds intend to declare and pay dividends and capital gains distributions
so as to avoid imposition of the federal excise tax. To do so, each Fund (and
in the case of Scout Money Market Fund, each Portfolio) expects to distribute
during the calendar year an amount equal to: (1) 98% of its calendar year
ordinary income; (2) 98% of its capital gains net income (the excess of short-
and long-term capital gain over short- and long-term capital loss) for the
one-year period ending each October 31; and (3) 100% of any undistributed
ordinary or capital gain net income from the prior calendar year. Dividends
declared in December of any year to shareholders of record on any date in
December will be deemed to have been paid by the Fund (or Portfolio) and
received by shareholders on the record date provided that the dividends are
paid before February 1 of the following year.

To comply with IRS regulations, the Funds are required by federal law to
withhold 31% of reportable payments (which may include dividends, capital
gains distributions, and redemptions) paid to shareholders who have not
complied with IRS regulations. In order to avoid this withholding requirement,
shareholders must certify on their Application or on a separate form supplied
by the Fund, that their Social Security or Taxpayer Identification Number
provided is correct and that they are not currently subject to backup
withholding, or that they are exempt from backup withholding.

Exempt-Interest Dividends - Scout Tax-Free Money Market Fund intends to
invest a sufficient portion of its assets in municipal securities so that it
will qualify to pay "exempt-interest dividends" (as defined in the Internal
Revenue Code) to its shareholders. The dividends payable by Scout Tax-Free
Money Market Fund from net tax-exempt interest from municipal securities will
qualify as exempt-interest dividends if, at the close of each quarter of its
taxable year, at least 50% of the value of the total assets of such Fund
consists of municipal securities. Exempt-interest dividends distributed to
shareholders are not includable in the shareholder's gross income for federal
income tax purposes. Any insurance proceeds which represent maturing interest
on defaulted municipal securities held by Scout Tax-Free Money Market Fund
will be excludable from federal gross income. Distributions of net investment
income received by Scout Tax-Free Money Market Fund from investments in debt
securities other than municipal securities, and any net realized short-term
capital gains distributed by Scout Tax-Free Money Market Fund, will be taxable
to its shareholders as ordinary income and will not be eligible for the
dividends-received deduction for corporations. Further, any distribution of
net realized capital gains will generally be subject to taxation at the state
and local level.

The Tax Reform Act of 1986 imposes certain additional restrictions on the use
of tax-exempt bond financing for nongovernmental business activities such as
industrial development bonds. Accordingly, interest on certain types of non-
essential, or private activity bonds, may no longer be exempt from federal
income tax. Interest on other types of non-essential or private activity bonds
while still tax-exempt, will be treated as a tax preference item for corporate
and individual investors in determining their liability in tax years beginning
after 1986.

Pursuant to the Social Security Act Amendments of 1993, up to 85% of a social
security recipient's benefits may be included in federal taxable income
(including income from tax-exempt sources such as tax-exempt bonds in Scout
Tax-Free Money Market Fund) plus 50% of their benefits exceeding certain
established amounts.

The federal income tax status of all distributions will be reported to
shareholders each January as a part of the annual statement of shareholder
transactions. Shareholders not subject to tax on their income will not be
required to pay tax on amounts distributed to them.

THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED HEREIN FOR GENERAL INFORMATION
ONLY. PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISERS WITH RESPECT
TO THE TAX CONSEQUENCES TO THEM OF INVESTMENT IN THE FUNDS.

SHAREHOLDER SERVICES

The Funds and their manager offer shareholders a broad variety of services
described throughout this prospectus. In addition, the following services are
available.

Prototype Retirement Plans - UMB Bank, n.a. has drafted several IRS-approved-
as-to-form prototype retirement plans to assist individuals, sole proprietors,
partnerships and corporations in meeting their tax qualified retirement plan
needs.

Individual Retirement Account (IRA) - The Bank also makes available IRA
accounts for individuals.

For further information about these services, please contact UMB Bank, n.a.

SHAREHOLDER INQUIRIES

Telephone inquiries may be made toll free to the Funds, 1-800-996-2862.

Shareholders may address written inquiries to the Funds at:

The Scout Fund Group
P.O. Box 410498
Kansas City, MO 64141-0498

For express delivery services:

The Scout Fund Group
BMA Tower
700 Karnes Blvd.
Kansas City, MO 64108-3306

Scout Stock Fund
Scout Regional Fund
Scout Balanced Fund
Scout Bond Fund
Scout WorldWide Fund
Scout Money Market Fund
Scout Tax-Free Money Market Fund

No-Load Mutual Funds

Manager and Investment Counsel
UMB Bank, n.a., Kansas City, Missouri

Auditors
Baird, Kurtz & Dobson, Kansas City, Missouri

Legal Counsel
Stradley, Ronon, Stevens & Young, Philadelphia, Pennsylvania
John G. Dyer, Kansas City, Missouri

Custodian
UMB Bank, n.a., Kansas City, Missouri

JONES & BABSON
MUTUAL FUNDS

P.O. Box 410498
Kansas City, MO 64141-0498

TOLL-FREE 1-800-996-2862

JB29A 10/97

PART B

SCOUT STOCK FUND, INC.
SCOUT REGIONAL FUND, INC.
SCOUT BALANCED FUND, INC.
SCOUT BOND FUND, INC.
SCOUT WORLDWIDE FUND, INC.
SCOUT MONEY MARKET FUND, INC.
SCOUT TAX-FREE MONEY MARKET FUND, INC.

STATEMENT OF ADDITIONAL INFORMATION

October 31, 1997

This Statement is not a Prospectus but should be read in conjunction with
the Funds' current Prospectus dated October 31, 1997. To obtain the
Prospectus please call the Funds toll free 1-800-996-2862.

TABLE OF CONTENTS
Page
Investment Objectives and Policies 2
Portfolio Transactions 2
Investment Restrictions 3
Scout Stock Fund 3
Scout Regional Fund 4
Scout Balanced Fund 4
Scout Bond Fund 5
Scout WorldWide Fund 6
Scout Money Market Fund 7
Scout Tax-Free Money Market Fund 7
Performance Measures 8
How the Funds' Shares are Distributed 9
How Share Purchases are Handled 10
Redemption of Shares 10
Signature Guarantees 11
Dividends and Distributions 11
Manager and Underwriter 11
How Share Price is Determined 12
Officers and Directors 12
Custodian 15
Independent Certified Public Accountants 15
Fixed Income Securities Described and Ratings 15
Municipal Securities Described and Ratings 18
Financial Statements 20

JB61 10/97
<PAGE>

INVESTMENT OBJECTIVES
AND POLICIES

The following policies supplement the Funds'
investment objectives and policies set forth in
the Prospectus.

PORTFOLIO TRANSACTIONS

Decisions to buy and sell securities for the
Funds are made by UMB Bank, n.a. for all the
Scout Funds. Officers of the Funds and Jones &
Babson, Inc. are generally responsible for
implementing or supervising these decisions,
including allocation of portfolio brokerage and
principal business and the negotiation of
commissions and/or the price of the securities.

The Funds in purchasing and selling portfolio
securities will seek the best available
combination of execution and overall price
(which shall include the cost of the transaction)
consistent with the circumstances which exist at
the time. The Fund does not intend to solicit
competitive bids on each transaction.

Scout Money Market Fund and Scout Tax-
Free Money Market Fund expect that purchases
and sales of portfolio securities usually will be
principal transactions. Portfolio securities
normally will be purchased directly from the
issuer or in the over-the-counter market from a
principal market maker for the securities, unless
it appears that a better combination of price and
execution may be obtained elsewhere. Usually
there will be no brokerage commission paid by
these Funds for such purchases. Purchases from
underwriters of portfolio securities will include a
commission or concession paid by the issuer to
the underwriter, and purchases from dealers
serving as market makers will include the
spread between the bid and asked price. In
instances where securities are purchased on a
commission basis, the Funds will seek
competitive and reasonable commission rates
based on the circumstances of the trade involved
and to the extent that they do not detract from
the quality of the execution.

The Funds believe it is in their best interest
and that of their shareholders to have a stable
and continuous relationship with a diverse group
of financially strong and technically qualified
broker-dealers who will provide quality
executions at competitive rates. Broker-dealers
meeting these qualifications also will be selected
for their demonstrated loyalty to the Funds,
when acting on their behalf, as well as for any
research or other services provided to the Funds.
The Funds normally will not pay a higher
commission rate to broker-dealers providing
benefits or services to them than they would pay
to broker-dealers who do not provide such
benefits or services. However, the Funds reserve
the right to do so within the principles set out in
Section 28(e) of the Securities Act of 1934 when
it appears that this would be in the best interests
of the shareholders.

No commitment is made to any broker or
dealer with regard to placing of orders for the
purchase or sale of Fund portfolio securities, and
no specific formula is used in placing such
business. Allocation is reviewed regularly by
both the Boards of Directors of the Funds and by
UMB Bank, n.a.

Since the Funds do not market their shares
through intermediary brokers or dealers, it is not
their practice to allocate brokerage or principal
business on the basis of sales of their shares
which may be made through such firms.
However, they may place portfolio orders with
qualified broker-dealers who recommend a Fund
to other clients, or who act as agent in the
purchase of Fund shares for their clients.

Research services furnished by broker-dealers
may be useful to the Fund manager in serving
other clients, as well as a Fund. Conversely, a
Fund may benefit from research services
obtained by the manager from the placement of
portfolio brokerage of other clients.

When it appears to be in the best interests of
its shareholders, a Fund may join with other
clients of the manager in acquiring or disposing

2
<PAGE>

of a portfolio holding. Securities acquired or
proceeds obtained will be equitably distributed
between the Fund and other clients
participating in the transaction. In some
instances, this investment procedure may affect
the price paid or received by the Fund or the
size of the position obtained by the Fund.

The Funds do not intend to purchase
securities solely for short-term trading; nor will
securities be sold for the sole purpose of
realizing gains. However, a security may be
sold and another of comparable quality
purchased at approximately the same time to
take advantage of what the Funds' manager
believes to be a disparity in the normal yield
relationship between the two securities. In
addition, a security may be sold and another
purchased when, in the opinion of management,
a favorable yield spread exists between specific
issues or different market sectors.

Short-term debt instruments with maturities of
less than one year are excluded from the
calculation of portfolio turnover.

Portfolio Turnover for Scout
Balanced Fund

There are no fixed limitations regarding
portfolio turnover for either the equity or fixed
income portions of Scout Balanced Fund's
portfolio. Although the Fund does not trade for
short-term profits, securities may be sold
without regard to the time they have been held
in the Fund when, in the opinion of the Fund's
management, investment considerations warrant
such action. As a result, while it is anticipated
that the portfolio turnover rates for the equity
and fixed income portions of the Fund's
portfolio generally will not exceed 100%, under
certain market conditions, these portfolio
turnover rates may exceed 100%. Increased
portfolio turnover rates would cause the Fund to
incur greater brokerage costs than would
otherwise be the case and may result in the
acceleration of capital gains which are taxable
when distributed to shareholders.

INVESTMENT RESTRICTIONS

In addition to the investment objectives and
portfolio management policy set forth in the
Prospectus under the caption "Investment
Objective and Portfolio Management Policy,"
the following restrictions also may not be
changed without approval of the "holders of a
majority of the outstanding shares" of the Funds
or the affected Portfolio series.

Scout Stock Fund will not: (1) purchase the
securities of any one issuer, except the United
States government, if immediately after and as a
result of such purchase (a) the value of the
holdings of the Fund in the securities of such
issuer exceeds 5% of the value of the Fund's
total assets, or (b) the Fund owns more than
10% of the outstanding voting securities, or any
other class of securities, of such issuer; (2)
engage in the purchase or sale of real estate or
commodities; (3) underwrite the securities of
other issuers; (4) make loans to any of its
officers, directors, or employees, or to its
manager, or general distributor, or officers or
directors thereof; (5) make loans to other
persons, except by the purchase of debt
obligations which are permitted under its
investment policy; (6) invest in companies for
the purpose of exercising control of
management; (7) purchase securities on margin,
or sell securities short; (8) purchase shares of
other investment companies except in the open
market at ordinary broker's commission or
pursuant to a plan of merger or consolidation;
(9) invest in the aggregate more than 5% of the
value of its gross assets in the securities of
issuers (other than federal, state, territorial, or
local governments, or corporations, or
authorities established thereby), which,
including predecessors, have not had at least
three years' continuous operations; (10) enter
into dealings with its officers or directors, its
manager or underwriter, or their officers or
directors, or any organization in which such
persons have a financial interest, except for
transactions in the Fund's own shares or other

3
<PAGE>

securities through brokerage practices which are
considered normal and generally accepted under
the circumstances existing at the time; (11)
purchase or retain securities of any company in
which any Fund officers or directors, or Fund
manager, its partner, officer, or director
beneficially owns more than 1/2 of 1% of said
company's securities, if all such persons owning
more than 1/2 of 1% of said company's
securities own in the aggregate more than 5% of
the outstanding securities of such company; (12)
borrow or pledge its credit under normal
circumstances, except up to 10% of its gross
assets (computed at the lower of fair market
value or cost) for temporary or emergency
purposes, and not for the purpose of leveraging
its investments, and provided further that any
borrowing in excess of 5% of the total assets of
the Fund shall have asset coverage of at least 3
to 1; (13) make itself or its assets liable for the
indebtedness of others; (14) invest in securities
which are assessable or involve unlimited
liability; (15) invest in securities issued by UMB
Financial Corporation or affiliate banks of
UMB Financial Corporation; or (16) issue senior
securities except for those investment procedures
permissible under the Fund's other restrictions.

Scout Regional Fund will not: (1) purchase
the securities of any one issuer, except the
United States Government, if immediately after
and as a result of such purchase (a) the value of
the holdings of the Fund in the securities of such
issuer exceeds 5% of the value of the Fund's
total assets, or (b) the Fund owns more than
10% of the outstanding voting securities, or any
other class of securities, of such issuer; (2)
engage in the purchase or sale of real estate or
commodities; (3) underwrite the securities of
other issuers; (4) make loans to any of its
officers, directors, or employees, or to its
manager, or general distributor, or officers or
directors thereof; (5) make loans to other
persons, except by the purchase of debt
obligations which are permitted under its
investment policy; (6) invest in companies for
the purpose of exercising control of
management; (7) purchase securities on margin,
or sell securities short; (8) purchase shares of
other investment companies except in the open
market at ordinary broker's commission or
pursuant to a plan of merger or consolidation;
(9) invest in the aggregate more than 5% of the
value of its gross assets in the securities of
issuers (other than federal, state, territorial, or
local governments, or corporations, or
authorities established thereby), which,
including predecessors, have not had at least
three years' continuous operations; (10) enter
into dealings with its officers or directors, its
manager or underwriter, or their officers or
directors, or any organization in which such
persons have a financial interest, except for
transactions in the Fund's own shares or other
securities through brokerage practices which are
considered normal and generally accepted under
the circumstances existing at the time; (11)
purchase or retain securities of any company in
which any Fund officers or directors, or Fund
manager, its partner, officer, or director
beneficially owns more than 1/2 of 1% of said
company's securities, if all such persons owning
more than 1/2 of 1% of said company's
securities own in the aggregate more than 5% of
the outstanding securities of such company; (12)
borrow or pledge its credit under normal
circumstances, except up to 10% of its gross
assets (computed at the lower of fair market
value or cost) for temporary or emergency
purposes, and not for the purpose of leveraging
its investments, and provided further that any
borrowing in excess of 5% of the total assets of
the Fund shall have asset coverage of at least 3
to 1; (13) make itself or its assets liable for the
indebtedness of others; (14) invest in securities
which are assessable or involve unlimited
liability; (15) invest in securities issued by UMB
Financial Corporation or by affiliate banks of
UMB Financial Corporation; or (16) issue senior
securities except for those investment procedures
permissible under the Fund's other restrictions.

Scout Balanced Fund will not: (1) purchase
the securities of any one issuer, except the
United States government, if immediately after
and as a result of such purchase (a) the value of

4
<PAGE>

the holdings of the Fund in the securities of such
issuer exceeds 5% of the value of the Fund's
total assets, or (b) the Fund owns more than
10% of the outstanding voting securities, or any
other class of securities, of such issuer; (2)
engage in the purchase or sale of real estate,
commodities or futures contracts; (3) underwrite
the securities of other issuers; (4) make loans to
any of its officers, directors, or employees, or to
its manager, or general distributor, or officers or
directors thereof; (5) make any loan (the
purchase of a security subject to a repurchase
agreement or the purchase of a portion of an
issue of publicly distributed debt securities is not
considered the making of a loan); (6) invest in
companies for the purpose of exercising control
of management; (7) purchase securities on
margin, or sell securities short; (8) purchase
shares of other investment companies except in
the open market at ordinary broker's
commission or pursuant to a plan of merger or
consolidation; (9) invest in the aggregate more
than 5% of the value of its gross assets in the
securities of issuers (other than federal, state,
territorial, or local governments, or
corporations, or authorities established thereby),
which, including predecessors, have not had at
least three years' continuous operations; (10)
except for transactions in its shares or other
securities through brokerage practices which are
considered normal and generally accepted under
circumstances existing at the time, enter into
dealings with its officers or directors, its
manager or underwriter, or their officers or
directors, or any organization in which such
persons have a financial interest; (11) purchase
or retain securities of any company in which any
Fund officers or directors, or Fund manager, its
partner, officer, or director beneficially owns
more than 1/2 of 1% of said company's
securities, if all such persons owning more than
1/2 of 1% of such company's securities, own in
the aggregate more than 5% of the outstanding
securities of such company; (12) borrow or
pledge its credit under normal circumstances,
except up to 10% of its gross assets (computed at
the lower of fair market value or cost) for
temporary or emergency purposes, and not for
the purpose of leveraging its investments, and
provided further that any borrowing in excess of
5% of the total assets of the Fund shall have
asset coverage of at least 3 to 1; (13) make itself
or its assets liable for the indebtedness of others;
(14) invest in securities which are assessable or
involve unlimited liability; (15) invest in
securities issued by UMB Financial Corporation
or by affiliate banks of UMB Financial
Corporation, (16) issue senior securities except
that borrowings from banks are permitted so
long as the requisite asset coverage under
restriction (12) above has been provided; or (17)
purchase any securities which would cause 25%
or more of the Fund's total assets at the time of
such purchase to be invested in any one
industry.

Scout Bond Fund will not: (1) purchase the
securities of any one issuer, except the United
States government, if immediately after and as a
result of such purchase (a) the value of the
holdings of the Fund in the securities of such
issuer exceeds 5% of the value of the Fund's
total assets, or (b) the Fund owns more than
10% of the outstanding voting securities, or any
other class of securities, of such issuer; (2)
engage in the purchase or sale of real estate or
commodities; (3) underwrite the securities of
other issuers; (4) make loans to any of its
officers, directors, or employees, or to its
manager, or general distributor, or officers or
directors thereof; (5) make loans to other
persons, except by the purchase of debt
obligations which are permitted under its
investment policy; (6) invest in companies for
the purpose of exercising control of
management; (7) purchase securities on margin,
or sell securities short; (8) purchase shares of
other investment companies except in the open
market at ordinary broker's commission or
pursuant to a plan of merger or consolidation;
(9) invest in the aggregate more than 5% of the
value of its gross assets in the securities of
issuers (other than federal, state, territorial, or
local governments, or corporations, or
authorities established thereby), which,
including predecessors, have not had at least

5
<PAGE>

three years' continuous operations; (10) enter
into dealings with its officers or directors, its
manager or underwriter, or their officers or
directors, or any organization in which such
persons have a financial interest, except for
transactions in the Fund's own shares or other
securities through brokerage practices which are
considered normal and generally accepted under
the circumstances existing at the time; (11)
purchase or retain securities of any company in
which any Fund officers or directors, or Fund
manager, its partner, officer, or director
beneficially owns more than 1/2 of 1% of said
company's securities, if all such persons owning
more than 1/2 of 1% of said company's
securities own in the aggregate more than 5% of
the outstanding securities of such company; (12)
borrow or pledge its credit under normal
circumstances, except up to 10% of its gross
assets (computed at the lower of fair market
value or cost) for temporary or emergency
purposes, and not for the purpose of leveraging
its investments, and provided further that any
borrowing in excess of 5% of the total assets of
the Fund shall have asset coverage of at least 3
to 1; (13) make itself or its assets liable for the
indebtedness of others; (14) invest more than
25% of the value of its assets in any one
industry; (15) invest in securities which are
assessable or involve unlimited liability; (16)
invest in securities issued by UMB Financial
Corporation or by affiliate banks of UMB
Financial Corporation; or (17) issue senior
securities except for those investment procedures
permissible under the Fund's other restrictions.

Scout WorldWide Fund will not: (1) purchase
the securities of any one issuer, except the
United States Government, if immediately after
and as a result of such purchase (a) the value of
the holdings of the Fund in the securities of such
issuer exceeds 5% of the value of the Fund's
total assets, or (b) the Fund owns more than
10% of the outstanding voting securities, or any
other class of securities, of such issuer; (2)
engage in the purchase or sale of real estate or
commodities contracts, including futures
contracts; (3) underwrite the securities of other
issuers; (4) make loans to any of its officers,
directors, or employees, or to its manager, or
general distributor, or officers or directors
thereof; (5) make loans to other persons, except
by the purchase of debt obligations which are
permitted under its investment policy; (6) invest
in companies for the purpose of exercising
control of management; (7) purchase securities
on margin, or sell securities short; (8) purchase
shares of other investment companies except in
the open market at ordinary broker's
commission or pursuant to a plan of merger or
consolidation; (9) invest in the aggregate more
than 5% of the value of its gross assets in the
securities of issuers (other than federal, state,
territorial, or local governments, or
corporations, or authorities established thereby),
which, including predecessors, have not had at
least three years' continuous operations; (10)
enter into dealings with its officers or directors,
its manager or underwriter, or their officers or
directors, or any organization in which such
persons have a financial interest, except for
transactions in the Fund's own shares or other
securities through brokerage practices which are
considered normal and generally accepted under
the circumstances existing at the time; (11)
purchase or retain securities of any company in
which any Fund officers or directors, or Fund
manager, its partner, officer, or director benefi-
cially owns more than 1/2 of 1% of said
company's securities, if all such persons owning
more than 1/2 of 1% of said company's
securities own in the aggregate more than 5% of
the outstanding securities of such company; (12)
borrow or pledge its credit under normal
circumstances, except up to 10% of its gross
assets (computed at the lower of fair market
value or cost) for temporary or emergency
purposes, and not for the purpose of leveraging
its investments, and provided further that any
borrowing in excess of 5% of the total assets of
the Fund shall have asset coverage of at least 3
to 1, and provided further that the Fund will not
purchase securities when borrowings exceed 5%
of its total assets; (13) make itself or its assets
liable for the indebtedness of others; (14) invest
in securities which are assessable or involve

6
<PAGE>

unlimited liability; (15) invest in securities
issued by UMB Financial Corporation or by
affiliate banks of UMB Financial Corporation;
or (16) issue senior securities except that
borrowings from banks are permitted so long as
the requisite asset coverage under restriction
(12) above has been provided.

Scout Money Market Fund will not: (1)
invest in equity securities or securities
convertible into equities; (2) purchase the
securities of any issuer (other than obligations
issued or guaranteed as to principal and interest
by the government of the United States, its
agencies or instrumentalities) if, as a result, (a)
more than 5% of either Portfolio's total assets
(taken at current value) would be invested in the
securities of such issuer, or (b) either Portfolio
would hold more than 10% of any class of
securities of such issuer (for this purpose, all
debts and obligations of an issuer maturing in
less than one year are treated as a single class of
securities); (3) borrow money in excess of 10%
of either Portfolio's total assets taken at market
value, and then only from banks as a temporary
measure for extraordinary or emergency
purposes; the Fund will not borrow to increase
income (leveraging) but only to facilitate
redemption requests which might otherwise
require untimely dispositions of Portfolio
securities; the Fund will repay all borrowings
before making additional investments, and
interest paid on such borrowings will reduce net
income; (4) mortgage, pledge or hypothecate its
assets except in an amount up to 15% (10% as
long as the Fund's shares are registered for sale
in certain states) of the value of its total assets
but only to secure borrowings for temporary or
emergency purposes; (5) issue senior securities,
as defined in the Investment Company Act of
1940, as amended; (6) underwrite securities
issued by other persons; (7) purchase or sell real
estate, but this shall not prevent investment in
obligations secured by real estate; (8) make
loans to other persons, except by the purchase of
debt obligations which are permitted under its
investment policy; the purchase of a security
subject to a repurchase agreement is not
considered making a loan; (9) purchase
securities on margin or sell short; (10) purchase
or retain securities of an issuer if to the
knowledge of the Fund's management and
directors of the Fund, each of whom owns more
than one-half of one percent (.5%) of such
securities, together own more than five percent
(5%) of the securities of such issuer; (11)
purchase or sell commodities or commodity
contracts; (12) write, or invest in, put, call,
straddle or spread options or invest in interests
in oil, gas or other mineral exploration or
development programs; (13) invest in companies
for the purpose of exercising control; (14) invest
in securities of other investment companies,
except as they may be acquired as part of a
merger, consolidation or acquisition of assets;
(15) invest more than 5% of the value of either
Portfolio's total assets at the time of investment
in the securities of any issuer or issuers which
have records of less than three years continuous
operation, including the operation of any
predecessor, but this limitation does not apply to
securities issued or guaranteed as to interest and
principal by the United States government or its
agencies or instrumentalities; (16) purchase any
securities which would cause more than 25% of
the value of a Portfolio's total net assets at the
time of such purchase to be invested in any one
industry; provided, however, that the Prime
Portfolio reserves freedom of action to invest up
to 100% of its assets in certificates of deposit or
bankers' acceptances of domestic branches of
U.S. banks; or (17) issue senior securities except
for those investment procedures permissible
under the Fund's other restrictions.

There is no limitation with respect to
investments in U.S. treasury bills, or other
obligations issued or guaranteed by the federal
government, its agencies and instrumentalities.

Scout Tax-Free Money Market Fund will
not: (1) invest in equity securities or securities
convertible into equities; (2) purchase more than
ten percent (10%) of the outstanding publicly
issued debt obligations of any issuer; (3) borrow
or pledge its credit under normal circumstances,
except up to 10% of its gross assets (computed at
the lower of fair market value or cost) for
temporary or emergency purposes (and not for
the purpose of leveraging its investments), and
provided further that any borrowing in excess of
5% of the total assets of the Fund shall have

7
<PAGE>

asset coverage of at least 3 to 1; the Fund will
repay all borrowings before making additional
investments; (4) pledge, mortgage or
hypothecate its assets to an extent greater than
ten percent (10%) of the value of its net assets;
(5) issue senior securities, as defined in the
Investment Company Act of 1940, as amended;
(6) underwrite any issue of securities; (7)
purchase or sell real estate, but this shall not
prevent investment in municipal bonds secured
by a real estate interest therein; (8) make loans
to other persons, except by the purchase of
bonds, debentures or similar obligations which
are publicly distributed; the purchase of a
security subject to a repurchase agreement is not
considered making a loan; (9) purchase
securities on margin or sell short; (10) purchase
or retain securities of an issuer if those directors
of the Fund, each of whom owns more than one-
half of one percent (.5%) of such securities,
together own more than five percent (5%) of the
securities of such issuer; (11) purchase or sell
commodities or commodity contracts; (12)
invest in, put, call, straddle or spread options;
(13) purchase securities of any issuer (except the
United States government, its agencies and
instrumentalities, and any municipal bond
guaranteed by the United States government) if,
as a result, more than 5% of the total assets
would be invested in the securities of such
issuer; for purposes of this limitation,
identification of the "issuer" will be based on a
determination of the source of assets and
revenues committed to meeting interest and
principal payments of each security, and a
government entity which guarantees the
securities issued by another entity is also
considered an issuer of that security; (14) invest
in companies for the purpose of exercising
control; (15) invest in securities of other
investment companies, except as they may be
acquired as part of a merger, consolidation or
acquisition of assets; or (16) invest more than
5% of the value of its total assets at the time of
investment in the securities of any issuer or
issuers which have records of less than three
years continuous operation, including the
operation of any predecessor, but this limitation
does not apply to securities issued or guaranteed
as to interest and principal by the United States
government or its agencies or instrumentalities.

PERFORMANCE MEASURES

Yield of Scout Money Market Fund and
Scout Tax-Free Money Market Fund

From time to time, each Portfolio of the Scout
Money Market Fund and Scout Tax-Free Money
Market Fund may quote their yields in
advertisements, shareholder reports or other
communications to shareholders. Yield
information is generally available by calling the
Funds toll free 1-800-996-2862.

The current annualized yield for each
Portfolio of the Scout Money Market Fund and
Scout Tax-Free Money Market Fund is
computed by: (a) determining the net change in
the value of a hypothetical pre-existing account
in a Fund having a balance of one share at the
beginning of a seven calendar-day period for
which yield is to be quoted, (b) dividing the net
change by the value of the account at the
beginning of the period to obtain the base period
return, and (c) annualizing the results (i.e.,
multiplying the base period return by 365/7).
The net change in value of the account reflects
the value of additional shares purchased with
dividends declared on the original share and any
such additional shares, but does not include
realized gains and losses or unrealized
appreciation and depreciation. In addition, each
Fund may calculate a compound effective yield
by adding 1 to the base period return (calculated
as described above, raising the sum to a power
equal to 365/7 and subtracting 1).

For the seven-day period ended June 30, 1997,
the current annualized yield of the Scout Money
Market Fund - Federal Portfolio was 4.96% and
the compound effective yield was 5.08%. At
June 30, 1997 that Portfolio's average maturity
was 14 days. For the seven-day period ended
June 30, 1997, the current annualized yield of
the Scout Money Market Fund - Prime Portfolio
was 5.10% and the compound effective yield
was 5.25%. At June 30, 1997 that Portfolio's
average maturity was 19 days. For the seven-
day period ended June 30, 1997, the current
annualized yield of the Scout Tax-Free Money
Market Fund was 3.70% and the compound
effective yield was 3.77%. At June 30, 1997,

8
<PAGE>

that Fund's average portfolio maturity was 16
days.

Total Return

Scout Stock Fund, Scout Regional Fund,
Scout Bond Fund and Scout WorldWide Funds'
"average annual total return" figures described
and shown below are computed according to a
formula prescribed by the Securities and
Exchange Commission. The formula can be
expressed as follows:

P(1+T) n = ERV

Where: P = a hypothetical initial
payment of $1,000

T = average annual
total return

n = number of years

ERV = Ending Redeemable Value
of a hypothetical $1,000
payment made at the
beginning of the 1, 5, or
10 year (or other) periods
at the end of the 1, 5, or
10 year (or other) periods
(or fractional portions
thereof);

The tables below show the average total return
for each of the Funds or Portfolios for the
specified periods.

STOCK BOND

For the one year
7/1/96-6/30/97 16.25% 6.33%

For the five years
7/1/92-6/30/97 12.27% 5.67%

For the ten years
7/1/87-6/30/97 9.90% 7.23%

From commencement
of operations to 6/30/97* 12.50% 8.16%
_____________________________________

* The Funds commenced operation on
November 18, 1982.
REGIONAL WORLD-
WIDE
For the one year
7/1/96-6/30/97 15.32% 26.40%

For the five years
7/1/92-6/30/97 10.91% N/A

For the ten years
7/1/87-6/30/97 7.00% N/A

From commencement
of operations to 6/30/97* 6.97% 15.41%

_____________________________________

* Scout Regional Fund commenced operation
on November 17, 1986. Scout World-
Wide Fund commenced operation on
September 14, 1993.

BALANCED

For the one year
7/1/96-6/30/97 8.70%

From commencement
of operations to 6/30/97* 7.69%
_____________________________________

* Scout Balanced Fund commenced
operation on December 6, 1995.

HOW THE FUNDS' SHARES
ARE DISTRIBUTED

Jones & Babson, Inc., as agent of the Scout
Funds, agrees to supply its best efforts as sole
distributor of the Funds' shares and, at its own
expense, pay all sales and distribution expenses
in connection with their offering other than
registration fees and other government charges.

Jones & Babson, Inc. does not receive any fee
or other compensation under its distribution
agreements with the Funds which continue in
effect until October 31, 1998, and which will
continue automatically for successive annual
periods ending each October 31, if continued at
least annually by the Funds' Boards of Directors,
including a majority of those Directors who are
not parties to such Agreements or interested
persons of any such party. They terminate
automatically if assigned by either party or upon

9
<PAGE>

60 days written notice by either party to the
other.

HOW SHARE PURCHASES
ARE HANDLED

Each order accepted will be fully invested in
whole and fractional shares, unless the purchase
of a certain number of whole shares is specified,
at the net asset value per share next effective
after an order is accepted by a Fund.

Each investment is confirmed by a year-to-
date statement which provides the details of the
immediate transaction, plus all prior
transactions in your account during the current
year. This includes the dollar amount invested,
the number of shares purchased or redeemed,
the price per share, and the aggregate shares
owned. A transcript of all activity in your
account during the previous year will be
furnished each January. By retaining each
annual summary and the last year-to-date
statement, you have a complete detailed history
of your account, which provides necessary tax
information. A duplicate copy of a past annual
statement is available from Jones & Babson, Inc.
at its cost, subject to a minimum charge of $5
per account, per year requested.

Normally, the shares which you purchase are
held by the Fund in open account, thereby
relieving you of the responsibility of providing
for the safekeeping of a negotiable share
certificate. Should you have a special need for a
certificate, one will be issued on request for all
or a portion of the whole shares in your account.
There is no charge for the first certificate issued.
A charge of $3.50 will be made for any
replacement certificates issued. In order to
protect the interests of the other shareholders,
share certificates will be sent to those
shareholders who request them only after the
Fund has determined that unconditional
payment for the shares represented by the
certificate has been received by its custodian,
UMB Bank, n.a.

If an order to purchase shares must be
canceled due to non-payment, the purchaser will
be responsible for any loss incurred by the Fund
involved arising out of such cancellation. To
recover any such loss, the Funds reserve the
right to redeem shares owned by any purchaser
whose order is canceled, and such purchaser
may be prohibited or restricted in the manner of
placing further orders.

The Funds reserve the right in their sole
discretion to withdraw all or any part of the
offering made by the prospectus or to reject
purchase orders when, in the judgment of
management, such withdrawal or rejection is in
the best interest of a Fund and its shareholders.
The Funds also reserve the right at any time to
waive or increase the minimum requirements
applicable to initial or subsequent investments
with respect to any person or class of persons,
which includes shareholders of the Funds'
special investment programs.

REDEMPTION OF SHARES

The right of redemption may be suspended, or
the date of payment postponed beyond the
normal three-day period by a Fund's Board of
Directors under the following conditions
authorized by the Investment Company Act of
1940: (1) for any period (a) during which the
New York Stock Exchange is closed, other than
customary weekend and holiday closing, or (b)
during which trading on the New York Stock
Exchange is restricted; (2) for any period during
which an emergency exists as a result of which
(a) disposal by the Fund of securities owned by it
is not reasonably practical, or (b) it is not
reasonably practicable for the Fund to determine
the fair value of its net assets; or (3) for such
other periods as the Securities and Exchange
Commission may by order permit for the
protection of the Fund's shareholders.

The Funds have elected to be governed by
Rule 18f-1 under the Investment Company Act
of 1940, pursuant to which the Funds are
obligated to redeem shares solely in cash up to
the lesser of $250,000 or 1% of a Fund's net
asset value during any 90-day period for any one
shareholder. Should redemptions by any
shareholder exceed such limitation, a Fund may
redeem the excess in kind. If shares are
redeemed in kind, the redeeming shareholder
may incur brokerage costs in converting the
assets to cash. The method of valuing securities
used to make redemptions in kind will be the
same as the method of valuing portfolio
securities described under "How Share Price is
Determined" in the Prospectus, and such

10
<PAGE>

valuation will be made as of the same time the
redemption price is determined.

SIGNATURE GUARANTEES

Signature guarantees normally reduce the
possibility of forgery and are required in
connection with each redemption method to
protect shareholders from loss. Signature
guarantees are required in connection with all
redemptions of $50,000 or more by mail or
changes in share registration, except as provided
in the Prospectus.

Signature guarantees must appear together
with the signature(s) of the registered owner(s),
on:

(1) a written request for redemption;

(2) a separate instrument of assignment,
which should specify the total number of
shares to be redeemed (this "stock power"
may be obtained from the Fund or from
most banks or stock brokers); or

(3) all stock certificates tendered for
redemption.

DIVIDENDS AND DISTRIBUTIONS

The Funds' policy is to distribute substantially
all of their net investment income, if any,
together with any net realized capital gains in
the amount and at a date that will avoid both
income (including capital gains) taxes on them
and the imposition of the federal excise tax on
undistributed income and capital gains (see
discussion under "Dividends, Distributions and
their Taxation" in the Prospectus).

Unless the shareholder elects otherwise,
dividends and capital gains distributions are
reinvested in additional shares at net asset value.
Any dividend and distribution election will
remain in effect until the Fund is notified by the
shareholder in writing at least three days prior
to the record date to change the election. An
account statement is sent to shareholders
whenever an income dividend or capital gains
distribution is paid.

Any dividend or capital gains distribution
reduces the net asset value per share by the per
share amount of such distribution.

Shares of Scout Money Market Fund and
Scout Tax-Free Money Market Fund begin
earning income on the effective date of
purchase. Shares of Scout Bond Fund begin
earning income on the day subsequent to the
effective date of purchase (see "How to Purchase
Shares"). Income earned on weekends, holidays
and other days on which these Funds are closed
for business is declared as a dividend on the first
preceding business day.

MANAGER AND UNDERWRITER

Pursuant to Management Agreements, each
Fund employs at its own expense UMB Bank,
n.a. as its manager and investment counsel.
Jones & Babson, Inc. serves as principal
underwriter at no charge to the Funds.

The aggregate management fee paid to UMB
Bank, n.a. by Scout Stock Fund during the most
recent fiscal year ended June 30, 1997, from
which UMB Bank, n.a. paid all the Fund's
expenses except those payable directly by the
Fund, was $1,510,741. The .85% annual fee
charged by UMB Bank, n.a. covers all normal
operating costs of the Fund.

The aggregate management fee paid to UMB
Bank, n.a. by Scout Regional Fund during the
most recent fiscal period ended June 30, 1997,
from which UMB Bank, n.a. paid all the Fund's
expenses except those payable directly by the
Fund, was $388,605. The .85% annual fee
charged by UMB Bank, n.a. covers all normal
operating costs of the Fund.

11
<PAGE>

The aggregate management fee paid to UMB
Bank, n.a. by Scout WorldWide Fund during the
most recent fiscal period ended June 30, 1997,
from which UMB Bank, n.a.. paid all the Fund's
expenses except those payable directly by the
Fund, was $336,708. The .85% annual fee
charged by UMB Bank, n.a. covers all normal
operating costs of the Fund.

The aggregate management fee paid to UMB
Bank, n.a. by Scout Bond Fund during the most
recent fiscal period ended June 30, 1997, from
which UMB Bank, n.a. paid all the Fund's
expenses except those payable directly by the
Fund, was $679,849. The .85% annual fee
charged by UMB Bank, n.a. under the current
agreement covers all normal operating costs of
the Fund.

The aggregate management fees paid to UMB
Bank, n.a. by Scout Money Market Fund during
the most recent fiscal year ended June 30, 1997,
from which UMB Bank, n.a. paid all the Fund's
expenses except those payable directly by the
Fund, was $3,326,933. The .50% annual fee
charged by UMB Bank, n.a. covers all normal
operating costs of the Fund.

The aggregate management fees paid to UMB
Bank, n.a., by Scout Tax-Free Money Market
Fund during the most recent fiscal year ended
June 30, 1997, from which UMB Bank, n.a.
paid all the Fund's expenses except those
payable directly by the Fund, was $643,126. The
.50% annual fee charged by UMB Bank, n.a.
under the current agreement covers all normal
operating costs of the Fund.

The aggregate management fees paid to UMB
Bank, n.a., by Scout Balanced Fund during the
most recent fiscal period ended June 30, 1997,
from which UMB Bank, n.a. paid all the Fund's
expenses except those payable directly by the
Fund, was $57,679. The .85% annual fee
charged by UMB Bank, n.a. under the current
agreement covers all normal operating costs of
the Fund.

HOW SHARE PRICE IS DETERMINED

The net asset value per share of each Fund
portfolio is computed once daily, Monday
through Friday, at the specific time during the
day that the Board of Directors of each Fund sets
at least annually, except on days on which
changes in the value of a Fund's portfolio
securities will not materially affect the net asset
value, or days during which no security is
tendered for redemption and no order to
purchase or sell such security is received by the
Fund, or the following holidays:

New Years Day January 1
Martin Luther Third Monday
King Day* in January
Presidents' Holiday Third Monday
in February
Good Friday Friday before Easter
Memorial Day Last Monday in May
Independence Day July 4
Labor Day First Monday
in September
Columbus Day* Second Monday
in October
Veterans' Day* November 11
Thanksgiving Day Fourth Thursday
in November
Christmas Day December 25

_____________________________________

* Money Market and Tax-Free Money Market
Funds only.

OFFICERS AND DIRECTORS

The Funds are managed by UMB Bank, n.a.,
subject to the supervision and control of the
Boards of Directors. The following table lists
the Officers and Directors of the Funds. Unless
noted otherwise, the address of each Officer and
Director is BMA Tower, 700 Karnes Blvd.,
Kansas City, Missouri 64108-3306. Except as
indicated, each has been an employee of Jones &
Babson, Inc. for more than five years.

12
<PAGE>

* Larry D. Armel, President and Director
(55), Jones & Babson, Inc., Scout Stock Fund,
Inc., Scout Regional Fund, Inc., Scout Bond
Fund, Inc., Scout Money Market Fund, Inc.,
Scout Tax-Free Money Market Fund, Inc.,
Scout WorldWide Fund, Inc., Scout Balanced
Fund, Inc., Shadow Stock Fund, Inc., David
L. Babson Growth Fund, Inc., D.L. Babson
Money Market Fund, Inc., D.L. Babson Tax-
Free Income Fund, Inc., Babson Value
Fund, Inc., Babson Enterprise Fund, Inc.,
Babson Enterprise Fund II, Inc., Babson-
Stewart Ivory International Fund, Inc.,
Buffalo Balanced Fund, Inc., Buffalo Equity
Fund, Inc., Buffalo High Yield Fund, Inc.,
Buffalo USA Global Fund, Inc.; Trustee and
President, D. L. Babson Bond Trust; Director,
AFBA Five Star Fund, Inc.

William E. Hoffman, D.D.S., Director (59),
Scout Stock Fund, Inc., Scout Regional Fund,
Inc., Scout Bond Fund, Inc., Scout Money
Market Fund, Inc., Scout Tax-Free Money
Market Fund, Inc., Scout WorldWide Fund,
Inc., Scout Balanced Fund, Inc.; Orthodontist,
3700 West 83rd Street, Suite 206, Prairie
Village, Kansas 66208.

Eric T. Jager, Director (54), Scout Stock
Fund, Inc., Scout Regional Fund, Inc., Scout
Bond Fund, Inc., Scout Money Market Fund,
Inc., Scout Tax-Free Money Market Fund,
Inc., Scout WorldWide Fund, Inc., Scout
Balanced Fund, Inc.; President, Windcrest
Investment Management, Inc.; Director,
Bartlett Futures, Inc., Nygaard Corporation,
4800 Main Street, Suite 600, Kansas City,
Missouri 64112.

Stephen F. Rose, Director (49), Scout Stock
Fund, Inc., Scout Regional Fund, Inc., Scout
Bond Fund, Inc., Scout Money Market Fund,
Inc., Scout Tax-Free Money Market Fund,
Inc., Scout WorldWide Fund, Inc., Scout
Balanced Fund, Inc.; President, Sun
Publications, Inc., 7373 W. 107th Street,
Overland Park, Kansas 66212.
_____________________________________

* Directors who are interested persons as
that term is defined in the Investment
Company Act of 1940, as amended.

Stuart Wien, Director (74), Scout Stock Fund,
Inc., Scout Regional Fund, Inc., Scout Bond
Fund, Inc., Scout Money Market Fund, Inc.,
Scout Tax-Free Money Market Fund, Inc., Scout
WorldWide Fund, Inc., Scout Balanced Fund,
Inc.; Retired, 4589 West 124th Place, Leawood,
Kansas 66209, formerly Chairman of the Board,
Milgram Food Stores, Inc.

P. Bradley Adams, Vice President and
Treasurer (37), Jones & Babson, Inc., Scout
Stock Fund, Inc., Scout Bond Fund, Inc., Scout
Money Market Fund, Inc., Scout Tax-Free
Money Market Fund, Inc., Scout Regional Fund,
Inc., Scout WorldWide Fund, Inc., Scout
Balanced Fund, Inc., David L. Babson Growth
Fund, Inc., D. L. Babson Money Market Fund,
Inc., D. L. Babson Tax-Free Income Fund, Inc.,
Babson Enterprise Fund, Inc., Babson
Enterprise Fund II, Inc., Babson Value Fund,
Inc., Shadow Stock Fund, Inc., Babson-Stewart
Ivory International Fund, Inc., D.L. Babson
Bond Trust, Buffalo Balanced Fund, Inc.,
Buffalo Equity Fund, Inc., Buffalo High Yield
Fund, Inc., Buffalo USA Global Fund, Inc.; Vice
President and Chief Financial Officer, AFBA
Five Star Fund, Inc.

Michael A. Brummel, Vice President,
Assistant Secretary and Assistant Treasurer
(40), Jones & Babson, Inc., Scout Stock Fund,
Inc., Scout Bond Fund, Inc., Scout Money
Market Fund, Inc., Scout Tax-Free Money
Market Fund, Inc., Scout Regional Fund, Inc.,
Scout WorldWide Fund, Inc., Scout Balanced
Fund, Inc., David L. Babson Growth Fund,
Inc., D.L. Babson Money Market Fund, Inc.,
D.L. Babson Tax-Free Income Fund, Inc.,
Babson Enterprise Fund, Inc., Babson
Enterprise Fund II, Inc., Babson Value Fund,
Inc., Shadow Stock Fund, Inc., Babson-Stewart
Ivory International Fund, Inc., D.L. Babson
Bond Trust, Buffalo Balanced Fund, Inc.,
Buffalo Equity Fund, Inc., Buffalo High Yield
Fund, Inc., Buffalo USA Global Fund, Inc.

Martin A. Cramer, Vice President and
Secretary (47), Jones & Babson, Inc., Scout
Stock Fund, Inc., Scout Bond Fund, Inc., Scout
Money Market Fund, Inc., Scout Tax-Free
Money Market Fund, Inc., Scout Regional Fund,
Inc., Scout WorldWide Fund, Inc., Scout
Balanced Fund, Inc., David L. Babson Growth

13
<PAGE>

Fund, Inc., D.L. Babson Money Market Fund,
Inc., D.L. Babson Tax-Free Income Fund, Inc.,
Babson Enterprise Fund, Inc., Babson
Enterprise Fund II, Inc., Babson Value Fund,
Inc., Shadow Stock Fund, Inc., Babson-Stewart
Ivory International Fund, Inc., D.L. Babson
Bond Trust, Buffalo Balanced Fund, Inc.,
Buffalo Equity Fund, Inc., Buffalo High Yield
Fund, Inc., Buffalo USA Global Fund, Inc.;
Secretary and Assistant Vice President, AFBA
Five Star Fund, Inc.

John G. Dyer, Vice President and Legal
Counsel (52), Scout Stock Fund, Inc., Scout
Regional Fund, Inc., Scout Bond Fund, Inc.,
Scout Money Market Fund, Inc., Scout Tax-Free
Money Market Fund, Inc., Scout WorldWide
Fund, Inc., Buffalo Balanced Fund, Inc., Buffalo
Equity Fund, Inc., Buffalo High Yield Fund,
Inc., Buffalo USA Global Fund, Inc.

Constance E. Martin, Vice President (36).
Assistant Vice President, Jones & Babson, Inc.;
Vice President, Scout Stock Fund, Inc., Scout
Bond Fund, Inc., Scout Money Market Fund,
Inc., Scout Tax-Free Money Market Fund, Inc.,
Scout Regional Fund, Inc., Scout WorldWide
Fund, Inc., Scout Balanced Fund, Inc., David L.
Babson Growth Fund, Inc., D.L. Babson Money
Market Fund, Inc., D.L. Babson Tax-Free
Income Fund, Inc., Babson Enterprise Fund,
Inc., Babson Enterprise Fund II, Inc., Babson
Value Fund, Inc., Babson-Stewart Ivory
International Fund, Inc., D.L. Babson Bond
Trust, Buffalo Balanced Fund, Inc., Buffalo
Equity Fund, Inc., Buffalo High Yield Fund,
Inc., Buffalo USA Global Fund, Inc.

Remuneration of Officers and Directors.
None of the officers or directors will be
remunerated by the Funds for their normal
duties and services. Their compensation and
expenses arising out of normal operations will
be paid by UMB Bank, n.a. under the provisions
of the Management Agreements.

COMPENSATION TABLE
<TABLE>
<CAPTION>

Pension or Estimated Total
Aggregate Retirement Annual Compensation
Name of Compensation Benefits Accrued Benefits From All Babson
Director From the As Part of Fund Upon Funds Paid to
Fund Expenses Retirement Directors**
______________ ____________ ________________ ___________ _____________
</CAPTION>
<S> <C> <C> <C> <C>
Larry D. Armel* -- -- -- --
William E. Hoffman $6,875 -- -- $6,875
Eric T. Jager $6,750 -- -- $6,750
Stephen F. Rose $6,875 -- -- $6,875
Stuart Wien $6,875 -- -- $6,875
</TABLE>
______________ ____________ ________________ ___________ ______________

* As an "interested director," Mr. Armel receives no compensation for
his services as a director.
** The amounts reported in this column reflect the total compensation
paid to each director for his services as a director of seven Scout
Funds during the fiscal year ended June 30, 1997. Directors' fees
are paid by the Funds' manager and not by the Funds themselves.

Messrs. Hoffman, Jager, Rose and Wien have
no financial interest in, nor are they affiliated
with either Jones & Babson, Inc. or UMB Bank,
n.a.

The Audit Committee of the Board of
Directors for all Scout Funds is composed of
Messrs. Hoffman, Jager, Rose and Wien.

The Officers and Directors of the Funds as a
group own less than 1% of any of the Funds.

The Funds will not hold annual meetings
except as required by the Investment Company
Act of 1940 and other applicable laws. The
Funds are Maryland corporations. Under
Maryland law, a special meeting of stockholders
of a Fund must be held if the Fund receives the
written request for a meeting from the

14
<PAGE>

stockholders entitled to cast at least 25% of all
the votes entitled to be cast at the meeting. Each
Fund has undertaken that its Directors will call
a meeting of stockholders if such a meeting is
requested in writing by the holders of not less
than 10% of the outstanding shares of the Fund.
To the extent required by the undertaking, the
Fund will assist shareholder communications in
such matters.

CUSTODIAN

The Funds' portfolio assets are held for
safekeeping by UMB Bank, n.a. This means
UMB Bank, n.a., rather than the Funds, has
possession of the Funds' cash and securities.
But, as directed by the Funds' officers, it delivers
cash to those who have sold securities to a Fund
in return for such securities, and to those who
have purchased portfolio securities from a Fund,
it delivers such securities in return for their cash
purchase price. It also collects income directly
from issuers of securities owned by a Fund and
holds this for payment to shareholders after
deduction of the Fund's expenses. UMB Bank,
n.a. also functions as manager and investment
adviser to the Funds (see "Manager and
Underwriter" in the Prospectus).

INDEPENDENT CERTIFIED
PUBLIC ACCOUNTANTS

The Funds' financial statements are examined
annually by independent certified public
accountants approved by the directors each year,
and in years in which an annual meeting is held
the directors may submit their selection of
independent public accountants to the
shareholders for ratification.

Reports to shareholders will be published at
least semiannually.

Baird, Kurtz & Dobson, City Center Square,
Suite 2700, 1100 Main Street, Kansas City,
Missouri 64105, is the present independent
certified public accountant for all of the Scout
Funds.

FIXED INCOME SECURITIES
DESCRIBED AND RATINGS

In evaluating investment suitability, each
investor must relate the characteristics of a
particular investment under consideration to
personal financial circumstances and goals.

Money market instruments are generally
described as short-term debt obligations issued
by governments, corporations and financial
institutions. Usually maturities are one year or
less. The yield from this type of instrument is
very sensitive to short-term lending conditions.
Thus, the income of money market funds will
follow closely the trend of short-term interest
rates, rising when those rates increase and
declining when they fall.

Because of the short maturities, fluctuation in
the principal value of money market-type
securities resulting from changes in short-term
interest rates normally will not be sufficient to
change the net asset value (price) per share.
Although the Fund's shareholders can anticipate
that this principal value stability will be
reflected in the price of the Fund's shares, it
cannot be guaranteed.

A money market security does not have the
characteristics usually associated with a long-
term investment. Long-term investors who
commit their assets to a money market security
must understand that short-term interest rates
have a history of sharp and frequent peaks and
valleys. Thus, there may be occasions when the
rates are sufficiently low as to be unattractive
when compared to the return on other types of
investments. The investor who commits long-
term funds to a short-term investment is exposed
to the risks associated with buying and selling
securities in anticipation of unpredictable future
market events.

Money market funds are neither insured nor
guaranteed by the U.S. Government, and there
can be no assurance that they will be able to
maintain a stable net asset value of $1.00 per
share.

15
<PAGE>

Description of Bond Ratings:

Standard & Poor's Corporation (S&P).

AAA - Highest Grade. These securities
possess the ultimate degree of
protection as to principal and
interest. Marketwise, they move with
interest rates, and hence provide the
maximum safety on all counts.

AA - High Grade. Generally, these bonds
differ from AAA issues only in a
small degree. Here too, prices move
with the long-term money market.

A - Upper-medium Grade. They have
considerable investment strength, but
are not entirely free from adverse
effects of changes in economic and
trade conditions. Interest and
principal are regarded as safe. They
predominantly reflect money rates in
their market behavior but, to some
extent, also economic conditions.

BBB - Bonds rated BBB are regarded as
having an adequate capacity to pay
principal and interest. Whereas they
normally exhibit protection para-
meters, adverse economic conditions
or changing circumstances are more
likely to lead to a weakened capacity
to pay principal and interest for
bonds in this category than for bonds
in the A category.

BB, B, CCC, CC -.Bonds rated BB, B, CCC
and CC are regarded, on balance, as
predominantly speculative with respect to the
issuer's capacity to pay interest and repay
principal in accordance with the terms of the
obligations. BB indicates the lowest degree of
speculation and CC the highest degree of
speculation. While such bonds will likely have
some quality and protective characteristics, these
are outweighed by large uncertainties or major
risk exposures to adverse conditions.

Moody's Investors Service, Inc. (Moody's).

Aaa - Best Quality. These securities carry
the smallest degree of investment
risk and are generally referred to as
"gilt-edge". Interest payments are
protected by a large, or by an
exceptionally stable 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.

Aa - High Quality by All Standards.
They are rated lower than the best
bonds because margins of protection
may not be as large as in Aaa
securities, fluctuation of protective
elements may be of greater
amplitude, or there may be other
elements present which make the
long-term risks appear somewhat
greater.

A - Upper-medium Grade. Factors
giving security to principal and
interest are considered adequate, but
elements may be present which
suggest a susceptibility to
impairment sometime in the future.

Baa - Bonds which are rated Baa are
considered as medium grade
obligations, i.e., they are neither
highly protected nor poorly secured.
Interest payments and principal
security appear adequate for the
present, but certain protective
elements may be lacking or may be
characteristically unreliable over any
great length of time. Such bonds
lack outstanding investment
characteristics and in fact have
speculative characteristics as well.

16
<PAGE>

Ba - Bonds which are rated Ba are judged
to have predominantly speculative
elements; their future cannot be
considered as well assured. Often the
protection of interest and principal
payments may be very moderate and
thereby not well safeguarded during
both good and bad times over the
future. Uncertainty of position
characterizes bonds in this class.

B - Bonds which are rated B generally
lack characteristics of the desirable
investment. Assurance of interest
and principal payments or
maintenance of other terms of the
contract over any long period of time
may be small.

Caa - Bonds which are rated Caa are of
poor standing. Such issues may be in
default or there may be present
elements of danger with respect to
principal or interest.

Ca - Bonds which are rated Ca represent
obligations which are speculative in a
high degree. Such issues are often in
default or have other marked
shortcomings.

Description of Commercial Paper Ratings:

Moody's . . . Moody's commercial paper rating
is an opinion of the ability of an issuer to repay
punctually promissory obligations not having an
original maturity in excess of nine months.
Moody's has one rating - prime. Every such
prime rating means Moody's believes that the
commercial paper note will be redeemed as
agreed. Within this single rating category are
the following classifications:

Prime - 1 Highest Quality
Prime - 2 Higher Quality
Prime - 3 High Quality

The criteria used by Moody's for rating a
commercial paper issuer under this graded
system include, but are not limited to the
following factors:

(1) evaluation of the management of the
issuer;

(2) economic evaluation of the issuer's
industry or industries and an appraisal
of speculative type risks which may be
inherent in certain areas;

(3) evaluation of the issuer's products in
relation to competition and customer
acceptance;

(4) liquidity;

(5) amount and quality of long-term debt;

(6) trend of earnings over a period of ten
years;

(7) financial strength of a parent company
and relationships which exist with the
issuer; and

(8) recognition by the management of
obligations which may be present or
may arise as a result of public interest
questions and preparations to meet
such obligations.

S&P - Standard & Poor's commercial paper
rating is a current assessment of the likelihood
of timely repayment of debt having an original
maturity of no more than 270 days. Ratings are
graded into four categories, ranging from "A"
for the highest quality obligations to "D" for the
lowest. The four categories are as follows:

"A" - Issues assigned this highest rating
are regarded as having the greatest
capacity for timely payment. Issues
in this category are further refined
with the designations 1, 2, and 3 to
indicate the relative degree of
safety.

"A-1" - This designation indicates that the
degree of safety regarding timely
payment is very strong.

"A-2" - Capacity for timely payment on
issues with this designation is
strong. However, the relative degree
of safety is not as overwhelming.

17
<PAGE>

"A-3" - Issues carrying this designation
have a satisfactory capacity for
timely payment. They are, however,
somewhat more vulnerable to the
adverse effects of changes in
circumstances than obligations
carrying the higher designations.

"B" - Issues rated "B" are regarded as
having only an adequate capacity
for timely payment. Furthermore,
such capacity may be damaged by
changing conditions or short-term
adversities.

"C" - This rating is assigned to short-term
debt obligations with a doubtful
capacity for payment.

"D" - This rating indicates that the issuer
is either in default or is expected to
be in default upon maturity.

MUNICIPAL SECURITIES
DESCRIBED AND RATINGS

Municipal securities include bonds and other
debt obligations issued by or on behalf of states,
territories and possessions of the United States
of America and the District of Columbia
including their political subdivisions or their
duly constituted authorities, agencies and
instrumentalities, the interest on which is
exempt from federal income tax.

Municipal securities are issued to obtain funds
for various public purposes, including the
construction of a wide range of public facilities,
such as airports, bridges, highways, housing,
hospitals, mass transportation, schools, streets,
waterworks and sewer systems. Municipal
securities also may be issued in connection with
the refunding of outstanding obligations and
obtaining funds to lend to other public
institutions and facilities or for general
operating expenses.

The two principal classifications of municipal
bonds are "general obligation" and "revenue."
General obligation bonds are secured by the
issuer's pledge of its full faith, credit and taxing
power for the payment of principal and interest.
Revenue bonds are payable only from the
revenues derived from a particular facility or
class of facilities, or in some cases, from the
proceeds of a special excise tax or other specific
revenue source.

Scout Tax-Free Money Market Fund may
invest in industrial development bonds, the
interest from which is exempt from federal
income tax. Under certain circumstances,
"substantial users" of the facilities financed with
such obligations, or persons related to
"substantial users," may be required to pay
federal income tax on this otherwise exempted
interest. Such persons should consult the
Internal Revenue Code and their financial
adviser to determine whether or not this Fund is
an appropriate investment for them.

There are a variety of hybrid and special types
of municipal obligations, as well as numerous
differences in the security of municipal bonds,
both within and between the two principal
classifications of general obligation and revenue.

Municipal notes include tax, revenue and
bond anticipation notes of short maturity,
generally less than three years, which are issued
to obtain temporary funds for various public
purposes. Also included in this category are
Construction Loan Notes, Short-Term Discount
Notes and Project Notes issued by a state or local
housing agency but secured by the full faith and
credit of the United States.

Yields on municipal securities depend on a
variety of factors, such as the size of a particular
offering, the maturity and the rating of the
obligation, economic and monetary conditions,
and conditions of the municipal securities
market, including the volume of municipal
securities available. Market values of municipal
securities will vary according to the relation of
their yields available. Consequently, the net
asset value of Tax-Free Money Market Fund and
its shares can be expected to change as the level
of interest rates fluctuates.

Municipal obligations, like all other debt
obligations, carry the risk of default. Through
careful selection and supervision, and
concentration in the higher-quality investment
grade issues, management intends to reduce this
risk.

18
<PAGE>

Prices of outstanding municipal securities will
fluctuate with changes in the interest rates on
new issues. Thus, the price of Tax-Free Money
Market Fund's shares will tend to increase as the
rates on new issues decline, and decrease
whenever the current rate is rising.
Management will seek to minimize such share
price fluctuation to the extent this can be
achieved without detracting from Scout Tax-
Free Money Market Fund's primary objective of
the highest quality and maturity characteristics
of the portfolio.

Municipal securities are not traded as actively
as other securities. Even though municipal
securities will be redeemed at face value upon
maturity, from time to time, when there has
been no active trading in a particular portfolio
holding, its interim pricing for the purpose of
the daily valuation of Scout Tax-Free Money
Market Fund's shares may have to be based on
other sources of information and methods
deemed fair and reasonable by the Board of
Directors. One principal method which is
commonly used by funds and other investors
who own municipal securities is called matrix
pricing.

From time to time, proposals have been
introduced in Congress to restrict or eliminate
the federal income tax exemption for interest on
municipal securities. Similar proposals may be
introduced in the future. If such proposals were
enacted, the availability of municipal securities
for investment by Tax-Free Money Market Fund
would be adversely affected. In such event, the
Fund would re-evaluate its investment objective
and policies and submit possible changes in the
structure of the Fund for the consideration of the
shareholders.

Income from the Tax-Free Money Market
Fund may be subject to the federal Alternative
Minimum Tax.

Ratings of Municipal Securities

The ratings of bonds by Moody's and Standard
and Poor's Corporation represent their opinions
of quality of the municipal bonds they undertake
to rate. These ratings are general and are not
absolute standards. Consequently, municipal
bonds with the same maturity, coupon and
rating may have different yields, while
municipal bonds of the same maturity and
coupon with different ratings may have the same
yield.

Both Moody's and S&P's Municipal Bond
Ratings cover obligations of states and political
subdivisions. Ratings are assigned to general
obligation and revenue bonds. General
obligation bonds are usually secured by all
resources available to the municipality and the
factors outlined in the rating definitions below
are weighted in determining the rating. Because
revenue bonds in general are payable from
specifically pledged revenues, the essential
element in the security for a revenue bond is the
quantity and quality of the pledged revenues
available to pay debt service.

Although an appraisal of most of the same
factors that bear on the quality of general
obligation bond credit is usually appropriate in
the rating analysis of a revenue bond, other
factors are important, including particularly the
competitive position of the municipal enterprise
under review and the basic security covenants.
Although a rating reflects S&P's judgment as to
the issuer's capacity for the timely payment of
debt service, in certain instances it may also
reflect a mechanism or procedure for an assured
and prompt cure of a default, should one occur,
i.e., an insurance program, federal or state
guaranty, or the automatic withholding and use
of state aid to pay the defaulted debt service.

S&P'S Ratings

AAA Prime - These are obligations of the
highest quality. They have the strongest capacity
for timely payment of debt service.

General Obligation Bonds - In a period of
economic stress, the issuers will suffer the
smallest declines in income and will be least
susceptible to autonomous decline. Debt burden
is moderate. A strong revenue structure appears
more than adequate to meet future expenditure
requirements. Quality of management appears
superior.

Revenue Bonds - Debt service coverage has
been, and is expected to remain, substantial.
Stability of the pledged revenues is also

19
<PAGE>

exceptionally strong, due to the competitive
position of the municipal enterprise or to the
nature of the revenues. Basic security provisions
(including rate covenant, earnings test for
issuance of additional bonds, debt service,
reserve requirements) are rigorous. There is
evidence of superior management.

AA - High Grade - The investment charac-
teristics of general obligation and revenue bonds
in this group are only slightly less marked than
those of the prime quality issues. Bonds rated
"AA" have the second strongest capacity for
payment of debt service.

A - Good Grade - Principal and interest
payments on bonds in this category are regarded
as safe. This rating describes the third strongest
capacity for payment of debt service. It differs
from the two higher ratings because:

General Obligation Bonds - There is some
weakness, either in the local economic base, in
debt burden, in the balance between revenues
and expenditures, or in quality of management.
Under certain adverse circumstances, any one
such weakness might impair the ability of the
issuer to meet debt obligations at some future
date.

Revenue Bonds - Debt service coverage is good,
but not exceptional. Stability of the pledged
revenues could show some variations because
ofincreased competition or economic influences
on revenues. Basic security provisions, while
satisfactory, are less stringent. Management
performance appears adequate.

Moody's Ratings of Municipal Bonds

Aaa - Bonds which are rated Aaa are judged to
be of the best quality. These securities carry the
smallest degree of investment risk and are
generally referred to as "gilt-edge." Interest
payments are protected by a large, or by an
exceptionally stable 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.

Aa - Bonds which are rated Aa are judged to be
of high quality by all standards. They are rated
lower than the best bonds because margins of
protection may not be as large as in Aaa
securities, fluctuation of protective elements may
be of greater amplitude, or there may be other
elements present which make the long-term
risks appear somewhat greater.

A - Bonds which are rated A possess many
favorable investment attributes and are to be
considered as upper medium grade obligations.
Factors giving security to principal and interest
are considered adequate, but elements may be
present which suggest a susceptibility to
impairment sometime in the future.

Moody's Ratings of Municipal Notes

MIG 1: The best quality, enjoying strong
protection from established cash flows of funds
for their servicing or from established and
broad-based access to the market for
refinancing, or both.

MIG 2: High quality, with margins of
protection ample, although not so large as in the
preceding group.

MIG 3: Favorable quality, with all security
elements accounted for, but lacking the
undeniable strength of the preceding grades.
Market access for refinancing, in particular, is
likely to be less well established.

FINANCIAL STATEMENTS

The audited financial statements of Scout
Stock Fund, Inc., Scout Bond Fund, Inc., Scout
Money Market Fund, Inc., Scout Tax-Free
Money Market Fund, Inc., Scout Regional Fund,
Inc., Scout WorldWide Fund, Inc. and Scout
Balanced Fund, Inc. contained in the June 30,
1997, Annual Reports to Shareholders are
incorporated herein by reference.
20