CITIZENS INVESTMENT TRUST, 485BPOS, 1998-10-26

CITIZENS INVESTMENT TRUST
485BPOS, 1998-10-26

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As filed with the Securities and Exchange Commission on October 26, 1998

Securities Act of 1933 File No. 2-80886
Investment Company Act of 1940 File No. 811-3626

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Post-Effective Amendment No. 43

and

REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940
Amendment No.38

CITIZENS FUNDS*
(Exact name of Registrant as specified in charter)

230 Commerce Way, Suite 300, Portsmouth, NH 03801
(Address of Principal Executive Offices)

Registrant's Telephone Number, including Area Code: (603) 436-5152

Sophia Collier
230 Commerce Way, Suite 300
Portsmouth, NH 03801
(Name and Address of Agent for Service)

It is proposed that this filing become effective:
[ ] Immediately upon filing pursuant to paragraph (b)
[X] On October 27, 1998 pursuant to paragraph (b)
[ ] 75 days after filing pursuant to paragraph (a)
[ ] On (date) pursuant to paragraph (a) of Rule 485

_______________________________________________________________________________
*Formerly known as Citizens Investment Trust
<PAGE>

CITIZENS FUNDS
CROSS INDEX PAGE

PART A: INFORMATION REQUIRED IN THE PROSPECTUS
_______________________________________________________________________________
Item 1. Cover Page Cover Page
_______________________________________________________________________________
Item 2. Synopsis; Fee Information Introduction; Fee
Information
_______________________________________________________________________________
Item 3. Condensed Financial Financial Highlights
Information
_______________________________________________________________________________
Item 4. General Description of Organization and
Registrant Management of the Trust

_______________________________________________________________________________
Item 5. Management of the Fund Organization and
Management of the Trust
_______________________________________________________________________________
Item 5A. Management's Discussion of Not Applicable
Fund Performance
_______________________________________________________________________________
Item 6. Capital Stock and Other How to Purchase and
Securities Redeem Shares; Dividends,
Distributions and Taxes
_______________________________________________________________________________
Item 7. Purchase of Securities How to Purchase and
Being Offered Redeem Shares;
Shareholder Services
_______________________________________________________________________________
Item 8. Redemption or Repurchase How to Purchase and
Redeem Shares;
Shareholder Services
_______________________________________________________________________________
Item 9. Legal Proceedings None

PART B: INFORMATION REQUIRED IN THE STATEMENT OF ADDITIONAL INFORMATION

Item 10. Cover Page Cover Page
_______________________________________________________________________________
Item 11. Table of Contents Table of Contents
_______________________________________________________________________________
Item 12. General Information and Introduction; How We
History Select Our Investments;
Organization and
Management of the Trust
_______________________________________________________________________________
Item 13. Investment Objectives and How We Select Our
Policies Investments; Policies and
Risk Factors; Other
Investment Techniques
_______________________________________________________________________________
Item 14. Management of the Registrant Organization and
Management of the Trust;
Trustee Profiles
_______________________________________________________________________________
<PAGE>

_______________________________________________________________________________
Item 15. Control Persons and Organization and
Principal Holders of Management of the Trust
Securities
_______________________________________________________________________________
Item 16. Investment Advisory and Organization and
Other Services Management of the Trust
_______________________________________________________________________________
Item 17. Brokerage Allocation and Organization and
Other Practices Management of the Trust
_______________________________________________________________________________
Item 18. Capital Stock and Other Dividends, Distributions
Securities and Taxes
_______________________________________________________________________________
Item 19. Purchase, Redemption and How to Purchase and
Pricing of Securities Redeem Shares;
Shareholder Services;
Dividends, Distributions
and Taxes
_______________________________________________________________________________
Item 20. Tax Status Federal Taxes
_______________________________________________________________________________
Item 21. Underwriters Organization and
Management of the Trust
_______________________________________________________________________________
Item 22. Calculation of Yield Dividends, Distributions
Quotations of Money and Taxes
Market Funds
______________________________________________________________________________
Item 23. Financial Statements Financial Highlights

PART C: OTHER INFORMATION

Information required to be included in Part C is set forth under the
appropriate item, so numbered, in Part C to this Registration Statement.

<PAGE>

The Talking Prospectus
October 27, 1998

Dear Friend,

Since our inception in 1982, our goal has been to earn money for our
shareholders by investing in companies that show both strong financial promise
and corporate responsibility.
We believe there is a revolution going on in business today and only
certain companies will thrive in this new, faster paced, environmentally
concerned and diverse global business environment. At Citizens Funds, we try to
invest in these companies - businesses with the potential to produce strong
financial results today while creating the type of world we want to live in
tomorrow.
We hope you will read this prospectus carefully and retain it for future
reference. We look forward to serving you at Citizens Funds.

Sincerely,

Sophia Collier
Chair, Citizens Advisers

Our Funds
Working Assets Money Market Fund's objective is current income consistent with
safety and liquidity. We seek to maintain a stable $1.00 Net Asset Value per
share at all times, although there is no assurance we will be able to do so.

Citizens Income Fund invests primarily in fixed-income securities with the
objective of generating current income and paying a dividend each month.

Citizens Index Fund invests in a market-weighted portfolio of stocks of
approximately 300 companies with the objective of long-term capital
appreciation.

Citizens Emerging Growth Fund invests primarily in promising small- and
medium-sized companies with the objective of aggressive growth.

Citizens Global Equity Fund invests in U.S. and foreign stocks with the
objective of capital appreciation.

Both the Working Assets Money Market Fund and the Citizens Index Fund offer
Institutional Class shares, in addition to Standard (retail class) shares.
Institutional Class shares offer lower expense ratios to investors who maintain
their accounts at or above the $100,000 level ($250,000 for registered
investment advisers).

Shares of the funds are neither insured nor guaranteed by the U.S. Government.

<PAGE>

Our Statement of Additional Information, dated October 27, 1998, and
incorporated by reference in this prospectus, is filed with the Securities and
Exchange Commission and is available on their website (www.sec.gov). For a
printed copy, please call us at 1-800-223-7010.

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

All funds are no load and subject to 12b-1 fees, with the exception of Working
Assets Money Market Fund, Institutional Class shares, which are not subject to
12b-1 fees. The minimum initial investment in each fund is $2,500 for Standard
shares. ($1,000 for IRAs and E(fund Account; $250 for accounts with an
Automatic Investment Plan.) Institutional Class shares of the Working Assets
Money Market Fund and the Citizens Index Fund require a minimum initial
investment of $100,000 ($250,000 for registered investment advisers).

FEE INFORMATION
<S> <C> <C> <C> <C> <C>

Working Citizens Citizens
Assets Citizens Citizens Emerging Global
Money Income Index Growth Equity
Market Fund Fund Fund Fund
Fund
Annual Fund
Operating Expenses
(as a percentage of
Average Net Assets)

Shareholder
Transaction Expenses* None None None None None
Management Fees .35% .65% .50% 1.00% 1.00%
Distribution
Expenses (12b-1 Fees) .20% .25% .25% .25% .25%
Other Expenses
(after waiver and
reimbursement) .66% .84% .84% .71% .95%
Total Fund
Operating Expenses 1.21+% 1.74+% 1.59% 1.96% 2.20%

</TABLE>

Institutional Class Shares Working
Assets Citizens
Money Index
Market Fund
Fund

Shareholder Transaction Expenses* None None
Management Fees .35% .50%
Distribution Expenses (12b-1 fees) None .07%**
Other Expenses
(after waiver and
reimbursement) .21% .38%
Total Fund Operating Expenses .56% .88%

* See "Costs for Other Services," below.
** Citizens Index Fund Institutional Class shares may be charged a fee of up to
0.07% for distribution expenses, but this fee was not assessed in fiscal year
1998.
+The investment adviser to Citizens Funds waived certain fees and reimbursed
certain expenses. Prior to reimbursement, for the year ended June 30, 1998,
Other Expenses for the Citizens Income Fund were .96% and Total Fund Operating
Expenses were 1.86%. For Working Assets Money Market Fund (Standard shares),
Other Expenses prior to reimbursement were .68% and Total Fund Operating
Expenses were 1.23%.

<S> <C>

Costs For Other Services
Returned checks $15.00
Returned Electronic Purchase/Payment - ACH $15.00

<PAGE>

Outgoing wire transfer $10.00
International wire transfer $20.00
Per check fee (waived with the Eofund Account) $0.50
Stop payments $10.00
Checks first 20 free
Box of 200 checks for the Eofund Account $15.95
ATM withdrawal/cash advance $0.65 each/$2.50
Annual fee for the Eofund Account $35.00
Debit Card replacement for the Eofund Account $10.00
Copies of statements, checks and tax forms $2.00/each
Below $2,500 minimum balance fee (except for the Eofund Account) $3.00 month
</TABLE>

Example: You would have paid the following expenses on a $1,000 investment,
assuming a 5% annual return and redemption at the end of each period:
<TABLE>
<CAPTION>

1 Year 3 Years 5 Years 10 Years
Working Assets Money Market Fund (Standard shares)* $12 $38 $66 $147
Working Assets Money Market Fund Institutional Class shares 6 18 31 70
Citizens Income Fund** 18 55 94 205
Citizens Index Fund (Standard shares) 16 50 87 189
Citizens Index Fund Institutional Class shares 9 28 49 108
Citizens Emerging Growth Fund 20 62 106 229
Citizens Global Equity Fund 22 69 118 253
</TABLE>

The example should not be considered a representation of past or future
expenses or past or future return. Actual expenses and actual return may be
greater or less than those included in the example above.
*Expenses reflect reimbursement by the funds' adviser without which the
expenses would have been $13, $39, $68 and $149 respectively.
**Expenses reflect reimbursement by the funds' adviser without which the
expenses would have been $19, $58, $101 and $218 respectively.

FINANCIAL HIGHLIGHTS
PER SHARE DATA
Income(Loss) from Investment Operations Less Distributions
<S> <C> <C> <C> <C> <C> <C> <C>
Year Net Asset Net Net Gains Total From Dividends Distributions Total
Ended Value, Income (Loss) on Investment (from (from Net Distributions
June 30 Beginning (Loss) Securities Operations Net Realized
of Period (both Income) Gain)
Realized &
Unrealized)
WORKING ASSETS MONEY MARKET FUND - STANDARD SHARES
1989 1.00 0.080 0.000 0.080 (0.080) 0.000 (0.080)
1990 1.00 0.080 0.000 0.080 (0.080) 0.000 (0.080)
1991 1.00 0.070 0.000 0.070 (0.070) 0.000 (0.070)
1992 1.00 0.040 0.000 0.040 (0.040) 0.000 (0.040)
1993 1.00 0.020 0.000 0.020 (0.020) 0.000 (0.020)
1994 1.00 0.023 0.000 0.023 (0.023) 0.000 (0.023)
1995 1.00 0.044 0.000 0.044 (0.044) 0.000 (0.044)
1996 1.00 0.045 0.000 0.045 (0.045) 0.000 (0.045)
1997 1.00 0.042 0.000 0.042 (0.042) 0.000 (0.042)
1998 1.00 0.045 0.000 0.045 (0.045) 0.000 (0.045)

WORKING ASSETS MONEY MARKET FUND-INSTITUTIONAL CLASS SHARES
1996(2) 1.00 0.021 0.000 0.021 (0.021) 0.000 (0.021)
1997 1.00 0.049 0.000 0.049 (0.049) 0.000 (0.049)
1998 1.00 0.051 0.000 0.051 (0.051) 0.000 (0.051)

CITIZENS INCOME FUND
1992(3) 10.00 0.01 0.07 0.08 (0.01) 0.00 (0.01)
1993 10.07 0.46 0.54 1.00 (0.47) 0.00 (0.47)
1994 10.60 0.55 (0.54) 0.01 (0.55) (0.02) (0.57)
1995 10.04 0.65 0.36 1.01 (0.65) (0.02) (0.67)
1996 10.38 0.66 (0.10) 0.56 (0.66) 0.00 (0.66)
1997 10.28 0.67 0.28 0.95 (0.67) 0.00 (0.67)
1998 10.56 0.60 0.49 1.09 (0.60) (0.02) (0.62)
</TABLE>

(1) Annualized
(2) Period from February 1, 1996 (commencement of operations)
(3) Period from June 10, 1992 (commencement of operations)

<PAGE>

RATIOS AND SUPPLEMENTAL DATA

Net Asset Portfolio Net Assets Ratio of Expenses Ratio of Ratio of Net Total
Value, End Turnover End of Period to Average Net Expenses to Income Return
of Period Rate (in 000's) Assets Net of Average Net (Loss) to
Reimbursement or Assets Prior to Average Net
fee waiver Reimbursement or Assets
fee waiver

1.00 N/A $166,285 1.13% 1.13% 7.74% 8.02%
1.00 N/A 214,603 1.05% 1.05% 7.50% 7.81%
1.00 N/A 243,194 1.02% 1.02% 6.47% 6.67%
1.00 N/A 223,951 1.07% 1.07% 4.09% 4.16%
1.00 N/A 152,625 1.11% 1.11% 2.41% 2.43%
1.00 N/A 103,766 1.16% 1.16% 2.31% 2.35%
1.00 N/A 97,611 1.16% 1.16% 4.39% 4.51%
1.00 N/A 78,326 1.18% 1.21% 4.56% 4.60%
1.00 N/A 85,179 1.25% 1.39% 4.23% 4.30%
1.00 N/A 103,597 1.21% 1.23% 4.46% 4.54%

1.00 N/A 14,539 0.47%(1) 0.47%(1) 5.16%(1) 2.09%(7)
1.00 N/A 17,504 0.60% 0.60% 4.92% 5.01%
1.00 N/A 18,178 0.56% 0.56% 5.11% 5.23%

10.07 0.00% 1,030 1.75%(1) 1.75%(1) 4.38%(1) 0.80%(7)
10.60 22.35% 12,601 1.42% 2.38% 4.98% 10.08%
10.04 52.62% 24,410 1.25% 2.01% 5.43% 0.04%
10.38 46.03% 30,122 1.35% 1.48% 6.47% 10.45%
10.28 41.36% 32,276 1.38% 1.48% 6.26% 5.48%
10.56 64.56% 33,230 1.41% 1.47% 6.44% 9.57%
11.03 80.14% 51,366 1.74% 1.86% 5.55% 10.49%
</TABLE>

CITIZENS INDEX FUND - INSTITUTIONAL CLASS SHARES
1996(5) 10.00 0.08 0.92 1.00 0.00 0.00 0.00
1997 11.00 0.08 3.94 4.02 (0.09) (0.09) (0.18)
1998 14.84 0.11 5.21 5.32 (0.08) (0.95) (1.03)

CITIZENS EMERGING GROWTH FUND
1994(6) 10.00 0.01 (0.08) (0.07) 0.00 0.00 0.00
1995 9.93 0.07 2.18 2.25 (0.09) (0.22) (0.31)
1996 11.87 (0.13) 4.72 4.59 0.00 (1.59) (1.59)
1997 14.87 (0.16) 0.68 0.52 0.00 (1.25) (1.25)
1998 14.14 (0.20) 4.61 4.41 0.00 (1.00) (1.00)

CITIZENS GLOBAL EQUITY FUND
1994(6) 10.00 0.01 (0.21) (0.20) 0.00 0.00 0.00
1995 9.80 (0.01) 0.96 0.95 0.00 (0.06) (0.06)
1996 10.69 (0.10) 1.43 1.33 0.00 (0.13) (0.13)
1997 11.89 (0.07) 2.65 2.58 0.00 0.00 0.00
1998 14.47 (0.20) 3.24 3.04 0.00 (0.56) (0.56)
</TABLE>

(4) Period from March 3, 1995 (commencement of operations)
(5) Period from January 25, 1996 (commencement of operations)
(6) Period from February 8, 1994 (commencement of operations)
(7) Not annualized

RATIOS AND SUPPLEMENTAL DATA

Net Asset Portfolio Net Assets Ratio of Expenses Ratio of Ratio of Net Total Return
Value, End Turnover End of Period to Average Net Expenses to Income
of Period Rate (in 000's) Assets Net of Average Net (Loss) to
Reimbursement or Assets Prior to Average Net
fee waiver Reimbursement or Assets
fee waiver

10.94 64.95% $106,096 1.75%(1) 1.75%(1) 0.98%(1) 9.40%(7)
13.41 6.44% 136,980 1.79% 1.82% 0.68% 23.41%
18.04 18.64% 211,116 1.59% 1.59% 0.02% 35.88%
23.46 13.64% 341,395 1.59% 1.59% (0.39%) 36.50%

11.00 6.44% 7,524 0.98%(1) 1.01%(1) 2.37%(1) 10.00%(7)
14.84 18.64% 13,001 0.88% 0.88% 0.76% 36.93%
19.13 13.64% 31,673 0.88% 0.88% 0.28% 37.38%

9.93 33.35% 3,754 1.89%(1) 3.81%(1) 0.63%(1) (1.80%)(7)
11.87 231.30% 10,638 1.90% 2.93% 0.53% 23.24%
14.87 337.41% 36,409 2.02% 2.34% (1.64%) 42.43%
14.14 228.66% 60,341 1.99% 2.01% (1.32%) 4.03%
17.55 245.30% 87,892 1.96% 1.96% (1.37%) 33.05%

9.80 0.00% 5,639 2.50%(1) 3.16%(1) 0.25%(1) (2.00%)(7)
10.69 22.10% 9,503 2.50% 2.99% 0.00% 9.77%
11.89 85.92% 15,595 2.55% 2.72% (1.01%) 12.52%
14.47 69.34% 29,573 2.10% 2.33% (0.70%) 21.70%
16.95 72.33% 49,045 2.20% 2.20% (0.76%) 21.75%

</TABLE>

<PAGE>

How We Select Our Investments
Financially Sound and Socially Responsible
Our investment strategy is to invest in companies we believe are
financially attractive and managed in a socially responsible manner. To find
such investments, we seek companies that make good and useful products and have
positive environmental, community and workplace records. We avoid companies
that engage in workplace discrimination or other unfair labor practices; whose
primary business is the manufacture of alcohol, tobacco, firearms or nuclear
power; or that use animals to test personal-care products or otherwise treat
animals in an inhumane manner.
Citizens Funds has certain policies we consider fundamental, such as
consistently applying both social and financial screens to all our investment
decisions. These, together with each fund's investment objective and other
technical investment policies described in the Statement of Additional
Information, cannot be changed without the approval of a majority of the
outstanding shares of each fund that would be affected by the change. In
addition to the specific policies for each fund, we also have some general
policies for all our funds.

General Investment Policies
We try not to put all our eggs in one basket. This means that, in managing
75% of a fund's assets, we will never invest more than 5% in any one company.
We do not invest more than 25% of the value of any one fund in one industry,
with the exception of securities of U.S. Government agencies or enterprises or,
in our money market fund, domestic banks.
Citizens Funds' role is to be a conscientious and alert investor, not a
controlling manager; therefore, across all our funds, we will not accumulate
more than 10% of the voting securities of any one company.
We sometimes purchase securities issued by companies that do not trade in
the public market. To maintain a good investment balance, we will limit these
and all other illiquid securities to a total of no more than 10% of each fund's
net assets.
Each of our funds may, from time to time, invest in money market
securities such as the ones we use in our money market fund.
Each fund may temporarily borrow money from banks (and pledge its assets
to secure such borrowing) to meet redemption requests or for other purposes. We
will keep this borrowing down to no more than 10% of the value of each fund's
total assets and make no purchases while we have any outstanding loans.
In pursuit of their investment objectives each of our funds, other than
the Working Assets Money Market Fund, may sometimes purchase options to buy or
sell securities in the future at values determined by the performance of
financial benchmarks or indexes. The use of options can add risk to the fund
because the fund manager may determine that exercise of the option will not
benefit the fund and therefore, the amount invested to acquire the option will
be lost. Also, the fund may be required to purchase at a disadvantage a
security on which it has sold a put option. We may also purchase "structured
securities," such as interest-only strips or similar vehicles where one or more
of the rights within the underlying securities has been traded through the
financial markets for a different right or series of rights. A risk associated
with interest-only strips is that the security may prepay or default and our
ability to collect interest payments will end.
Risks in the use of derivative securities depend on the fund manager's
ability to predict correctly the direction of interest rates, securities prices
or other factors. Risks include: a) the risk that interest rates, securities

<PAGE>

prices or other factors do not move in the directions being hedged against, in
which case the fund will have incurred the cost of the derivative (either its
purchase price or, by writing an option, losing the opportunity to profit from
increases in the value of the securities covered) with no tangible benefits; b)
an imperfect correlation between the price of derivatives and the movements of
the securities prices, interest rates or currency exchange rates being hedged;
c) the possible absence of a liquid secondary market for any particular
derivative at any time; d) the potential loss if the counterparty to the
transaction does not perform as promised; and e) the possible need to defer
closing out certain positions to avoid adverse tax consequences.

Money Market Instruments and Repurchase Agreements
During periods of unusual market conditions, or for liquidity purposes or
pending reinvestment of the proceeds from the sale of shares, we may invest all
or a portion of the assets of each fund in money market instruments, including
obligations of agencies and instrumentalities of the U.S. Government,
certificates of deposit and commercial paper or other corporate notes of
investment grade quality.
Sometimes we invest our surplus cash in repurchase agreements with
financially strong stockbrokers or banks that are members of the Federal
Reserve. We require all vendors of repurchase agreements to set aside
collateral in our name in the form of government securities equal to 102% of
the value of any repurchase agreement. However, it is important to note that
while repurchase agreements may be a useful tool in managing a fund, they do
have some greater risk than directly investing in securities. If a bank or
stockbroker becomes bankrupt, or otherwise defaults after selling us a
repurchase agreement, we may suffer some delay and expense in liquidating our
collateral or may have a loss of principal or interest.

Working Assets Money Market Fund
Objective: Current income consistent with safety and liquidity
In our money market fund, we invest only in short-term money market instruments
(short-term debt issued by branches of the government, corporations, banks or
other financial institutions) that we believe present minimal risk, and we
maintain a dollar-weighted average maturity of 90 days or less for the fund as
a whole. Checking services are available.

U.S. Government Securities
When we look at government securities, we buy only those that are issued
or guaranteed, as to both interest and principal, by agencies or other
enterprises of the United States Government.

Commercial Paper
We will also buy high quality "commercial paper," which is short-term debt
issued by well-established corporations. One hundred percent of this short-term
debt must be rated A-1 by Standard & Poor's Ratings Group or have a comparably
high rating by another nationally recognized rating service. If a security is
rated by only one agency, it must be rated in the highest rating category by
that agency. If a security is not rated, it must be as good as A-1 in our
judgment. We also use our own research and experience to help assure our money
market securities have only a minimal credit risk.
Banks sometimes issue other types of debt that offer us a yield advantage.
These include certificates of deposit, time deposits and bankers' acceptances
of U.S. banks or thrift institutions.

<PAGE>

Risk Factors
The shares of Working Assets Money Market Fund are neither insured nor
guaranteed by the U.S. Government, and there is no assurance the fund will be
able to maintain a stable Net Asset Value of $1.00 per share, despite our care
and caution.

Citizens Income Fund
Objective: Current income
Citizens Income Fund invests in fixed-income or debt securities, through which
the agencies and enterprises of the U.S. Government and companies raise money
in exchange for interest payments or dividends. The Citizens Income Fund
invests most of its money in bonds or mortgages that are due within two to 30
years, although at times it will hold short-term securities as well. Our
average maturity in the Citizens Income Fund is usually between five and 15
years. By committing money for this longer period, we generally can earn higher
interest than in the money market fund, but we are taking more risk.

At least 65% of the Citizens Income Fund's assets are invested in
securities rated "investment grade" (BBB or above). Up to 35% may be invested
in bonds or other debt instruments rated as below investment grade. Although
bonds rated below BBB are considered speculative (and are referred to as "junk
bonds") and therefore add risk, we believe by limiting the overall fund
exposure to a maximum level of 35%, the higher yield usually available in these
securities can benefit the fund and more than compensate for the greater risk.
Occasionally we buy securities that are not rated. In these cases, the
security must be of comparable quality, in our judgment, to the rated
securities we buy for the applicable fund.
In our Statement of Additional Information, we give more detailed
information about each rating agency and its system of ratings.

Risk Factors
The prices of bonds and other debt securities, like stock prices, go up
and down in value. These market price fluctuations will be reflected in the
value of the fund. When interest rates rise, the market value of our Income
Fund will decline, and when interest rates fall, the market value of our Income
Fund will rise.
Prices of debt securities also go up and down based on how credit-worthy
investors perceive issuers of these securities to be. As discussed below, the
prices of debt securities with lower ratings tend to go up and down more than
those of securities with higher ratings. It is possible that some issuers will
not be able to make payments to the fund on debt securities that the fund
holds, and as a result the fund may not receive the income it expected from
these securities or repayment of capital as of the due date. If an issuer of a
debt security is viewed as unable to make timely payments on its securities the
value of these securities may become more volatile. In this case, the fund may
not be able to sell those debt securities at the prices carried on the fund's
books.
Debt securities offering higher yields, such as junk bonds, tend to have
more risk, and the prices of these securities may go up and down more than
securities with higher ratings. During certain periods, the higher yields that
the fund receives on its lower rated debt securities are paid by the issuer
primarily because of this increased risk of loss of principal and income. Lower
rated securities tend to react more to economic changes, industry trends,
legislative and regulatory developments and changes in perceptions about their

<PAGE>

issuer's credit-worthiness than securities with higher ratings. In the past,
economic downturns or increases in interest rates have under certain
circumstances caused lower rated securities to default at higher than usual
rates. Future problems with the economy and increases in interest rates could
have a similar effect.
Debt securities tend to provide interest payments to the fund at fixed
amounts. Even if the fund's Net Asset Value declines because of a decline in
the market value of its debt securities, the fund may continue to earn the same
level of interest income from the securities. However, the fund may not be able
to sell its lower rated securities as quickly as those with higher ratings,
especially if investors perceive the securities to be of a low credit quality.
In this case, the fund's investment adviser may play a role in determining a
fair value for these securities. During certain economic downturns it may be
more difficult for the fund to sell its lower rated securities at their fair
value to meet requests for redemptions by shareholders or to respond to changes
in the market.
The Citizens Income Fund may also invest in mortgage-backed securities.
There are specific risks associated with investing in mortgage-backed
securities, as the value of these investments may be adversely affected by
prepayment of mortgages or extension of the maturity of such mortgages. When
interest rates go down, mortgage-backed securities experience higher rates of
prepayment. Therefore, mortgage-backed securities may not be an effective means
of locking in a particular interest rate. When interest rates go up,
mortgage-backed securities experience lower rates of prepayment. As a result,
prices of mortgage-backed securities may decrease more than prices of other
debt obligations when interest rates go up.

Citizens Index Fund
Objective: Long-term capital appreciation
The Citizens Index Fund is invested in a portfolio of companies designed to
track the performance of the Citizens Index(TM). We believe these companies
best represent their industries. The Citizens Index is comprised of
approximately 300 companies, roughly 200 of which are very large companies that
also are included in the S&P 500. The others are companies selected in order to
provide industry diversity, which we believe is essential to a sound investment
program.
On a day-to-day basis, the fund is run by purchasing and holding common
stock of all the companies in the Index in a percentage, as closely as
possible, equal to each security's total market capitalization divided by the
total market capitalization of all the companies in the Index. In addition,
under normal circumstances the fund will usually hold a small amount of cash or
money market instruments (no more than 5%) resulting from shareholder purchase
and redemption activity and as a provision for operating expenses. Holding this
cash, together with the costs of operations, will prevent us from ever
perfectly tracking the theoretical performance of the underlying Index. Payment
of our operating expenses will reduce returns. Our small allocation to cash
will improve returns when the market is heading down and hurt them when the
market is moving up.
Companies will be deleted from the Index and divested from the fund if
they fail our annual social responsibility review. If a company is removed, we
will replace it with another company or companies from the same industry that
meets all social criteria. In addition, from time to time we may make other
changes in the Index to include, for example, exceptional companies, or to
reflect changes in the composition of the S&P 500. We do not expect these
changes to exceed 10% of the members of the Index on an annual basis.

Risk Factors
Like all stock funds, the Net Asset Value of the Citizens Index Fund will
fluctuate based on market and economic conditions, or other factors that affect
particular companies or industries.

<PAGE>

We are always pleased to send interested investors a current list of the
members of our Index.

Citizens Emerging Growth Fund
Objective: Aggressive growth
Our Citizens Emerging Growth Fund looks for aggressive gains by investing in
small-to medium-sized companies. During normal market conditions, at least 65%
of this fund's assets will be invested in the common stock of companies that
have at least $4 billion in market capitalization.

Risk Factors
While many of these companies will have strong businesses, some still will
be unseasoned and therefore may have some speculative characteristics.
Investing in smaller companies is a long-term process with the potential for
significant gains. However, the value of this fund can have significant
fluctuation, because smaller companies have unique risks. They may be dependent
on individual managers or have a harder time obtaining financing and market
share. Further, their shares are more volatile and thinly traded. To moderate
this risk, we typically plan to hold between 30 and 50 companies in the fund.
Since most of the companies we will purchase for the Citizens Emerging
Growth Fund are relatively new, we don't expect much, if any, dividend income.
At times, we may also buy short-term, fixed-income securities as well as
preferred stock for the fund.

Citizens Global Equity Fund
Objective: Capital appreciation
In the Citizens Global Equity Fund, we invest primarily in common stocks of
both U.S. domestic and foreign companies. We seek companies with growing
sustainable earnings; innovative products, services and business strategies;
revised corporate strategies; or those which are beneficiaries of political or
economic conditions. We plan to allocate more than half our assets to foreign
markets, in most circumstances in a minimum of three countries. From time to
time, we also may buy other securities, such as convertible or preferred stocks
and short-term debt securities.

Risk Factors
Foreign stock markets are generally less efficient and more volatile than
those in the United States. This creates opportunities, but also risk.
Settlement and trading costs are generally higher on foreign exchanges than in
the U.S. The economies and governments of some countries in which the fund may
invest may be less mature and stable than those of the U.S., and when political
or economic changes occur, there can be an adverse impact on the fund. Adverse
impacts may come from exchange control regulation, expropriation, confiscatory
taxation and political or social instability. The risks of investing in
emerging market countries are even greater and can involve risk of higher
inflation, high sensitivity to commodity prices and economic dependence on a
few industries or government-owned industries.
To moderate these risks and gain potential benefits, we use a number of
investment techniques. One of these is country selection. We restrict our
investments in riskier emerging nations (such as Argentina or Singapore) to no
more than 25% of the assets of the Citizens Global Equity Fund.

When we invest in securities listed on foreign exchanges, we buy them in
the currency of the local country. Often the local currency will fluctuate

<PAGE>

against the U.S. dollar. To moderate this risk, we sometimes use currency
"hedging." We do this by entering into arrangements to buy or sell a particular
currency, security or securities index for a stated value against the U.S.
dollar at a given time. While there is a cost involved in hedging, as well as a
risk that our hedging strategy may not work and will add cost, create losses or
reduce our potential gains, we still think hedging can be a valuable tool.

Organization and Management of Citizens Funds
Citizens Funds commenced operations on November 24, 1982; up until August
1995, it was known as Working Assets Common Holdings, and then later as
Citizens Trust, until changing its name to Citizens Funds in July 1998. We are
a Massachusetts business trust and an open-end investment company registered
under the Investment Company Act of 1940 as a diversified management company.
Citizens Funds is also a "series" company, which means we can have several
funds, each with its own investment objective, assets and liabilities. A board
of trustees supervises Citizens Funds.
In order to manage Citizens Funds on a day-to-day basis, we have signed a
Management Agreement with Citizens Advisers, with offices at 230 Commerce Way,
Suite 300, Portsmouth, NH, 03801. Citizens Advisers has managed Citizens Funds'
assets since our inception in 1982. Citizens Securities, a subsidiary of
Citizens Advisers, serves as Citizens Funds' distributor.
Both Citizens Advisers and Citizens Securities are California
corporations. Sophia Collier is the 60% beneficial owner. Fellow shareholders
are John P. Dunfey, Robert J. Dunfey, Sr. and Gerald F. Dunfey, three brothers
who each own 12% each; and William B. Hart, who owns 4%.

The Role of Investment Adviser
In its role as investment adviser to Citizens Funds, Citizens Advisers
determines which companies meet the funds' investment criteria and will be
carried on our "Approved List." It also selects which securities will be bought
and sold for the Working Assets Money Market Fund and the Citizens Index Fund.
Laura Provost is lead manager of the team that manages the Working Assets Money
Market Fund. Prior to joining Citizens Advisers as Manager of its Investment
Management Department in 1997, Ms. Provost was a member of the fund management
team for the Patriot Group of John Hancock Mutual Funds, a family of five
closed-end mutual funds comprising some $1 billion in assets. Ms. Provost
served in various capacities at John Hancock, including Junior Portfolio
Officer (1993-95), Senior Portfolio Officer (1995-96) and Portfolio Manager
(1996-97).
Sophia Collier is the lead manager of the team that manages the Citizens
Index Fund. Ms. Collier was the president of Citizens Funds and of its
investment adviser Citizens Advisers, until September, 1998. Currently she is
the principal owner and chair of the board of directors of Citizens Advisers.
To assist with portfolio management for the other funds, Citizens Advisers
has retained, at its own expense, two sub-advisers.

Seneca Capital Management LLC
Our sub-adviser for the Citizens Income Fund and the Citizens Emerging
Growth Fund, Seneca Capital Management LLC, is a registered investment adviser
established in 1990. It is the successor to our prior sub-adviser, GMG/Seneca
Capital Management, 74.9% of which was purchased by Phoenix, Duff and Phelps in
1997. Seneca Capital Management LLC manages more than $6 billion from its
offices at 909 Montgomery Street, San Francisco, CA.

<PAGE>

Gail Seneca is the lead manager of the team that manages the Citizens
Income Fund. Ms. Seneca is the Chief Investment Officer and Managing Partner of
Seneca Capital Management, which she founded in 1989.

Rick Little is the lead manager of the team that Manages the Citizens
Emerging Growth Fund. Mr. Little has worked in the investment field for 25
years. He has been with Seneca Capital Management LLC since its inception in
1990 and was previous a senior vice president at NatWest Securities.

Clemente Capital, Inc.

Our sub-adviser for the Citizens Global Equity Fund, Clemente Capital,
Inc., is a registered investment adviser organized in 1979. It is owned by
Lilia Clemente, with 61.15%; Wilmington Trust of Wilmington, DE, with 24%; and
Diaz-Verson Capital Investments, Inc., of Columbus, GA, with 14.85%. Clemente
also manages the First Philippine and Clemente Global Growth Funds, two
closed-end funds traded on the New York Stock Exchange. Its headquarters are at
Carnegie Hall Tower, 152 West 57th Street, New York, NY.

Ms. Clemente is the lead manager of the team that manages the Citizens
Global Equity Fund. Ms. Clemente is the Chair, Chief Executive Officer and
Global Strategist at Clemente Capital, which she has led for over two decades.

Citizens Funds' Management Agreement
Citizens Funds' Management Agreement with Citizens Advisers, and Citizens
Advisers' Sub-Advisory Agreements with the sub-advisers, specify fees as
follows (based on average annual net assets of the respective funds).
Citizens Funds Adviser
Pays Pays
Adviser Sub-Adviser
Working Assets
Money Market Fund
Standard shares .35% -
Institutional Class shares .35% -

Citizens Income Fund .65% .175%

Citizens Index Fund
Standard shares .50% -
Institutional Class shares .50% -

Citizens Emerging Growth Fund 1.00% .35%

Citizens Global Equity Fund 1.00% .35%

Citizens Advisers performs a wide variety of administrative duties for
Citizens Funds under a separate administrative and shareholder services
contract which provides for reimbursement of out-of-pocket expenses as well as

<PAGE>

fees for services rendered. Administrative fees and expenses are payable
monthly and include fees based on the annual rate of average daily net assets
in the following amounts: Working Assets Money Market Fund (Standard shares),
0.15%; Citizens Income Fund, Citizens Emerging Growth Fund and Citizens Global
Equity Fund, 0.10%; Citizens Index Fund (Standard shares), 0.20%; Citizens
Index Fund, (Institutional Class shares), 0.30% (of which only 0.09% was
charged for the year ended June 30, 1998). In addition, Citizens Securities
provides a number of administrative services to Citizens Funds relating
primarily to shareholder services and communications, and is reimbursed a flat
rate approximating the "market price" of such services. Citizens Index Fund,
Standard shares also may be charged a fee by Citizens Advisers of up to 0.45%
based on average daily net assets for shareholder services, and for the year
ended June 30, 1998 paid a fee of 0.31%. Citizens Advisers sometimes will
perform services under this administrative contract directly, or may contract
to have specialized services provided by third parties, such as investment
advisers for pension funds or other institutions which maintain omnibus
accounts with Citizens Funds.
Other expenses paid by the funds include all expenses not expressly
assumed by Citizens Advisers. These include interest, taxes, audit and legal
fees, custodian and transfer agent charges, shareholder service and
administration, insurance premiums, cost of registering shares under federal
and state laws, dues and any litigation costs, as well as the cost of
typesetting, printing and distributing shareholder reports and prospectuses
sent to shareholders. Under the administrative and shareholder services
contract for the year ended June 30, 1998, we paid $2,297,371 to Citizens
Advisers for these other administrative and shareholder services, of which
institutional classes paid $19,257. By fund and class, the breakdown was as
follows: Citizens Index Fund (Standard shares), $1,617,767; Citizens Index Fund
(Institutional Class shares), $18,144; Citizens Income Fund, $101,909; Citizens
Global Equity Fund, $86,805; Citizens Emerging Growth Fund, $193,896; Working
Assets Money Market Fund (Standard shares), $277,737; Working Assets Money
Market Fund (Institutional Class shares), $1,113.
Institutional Class shareholders in the Working Assets Money Market Fund
and Citizens Index Fund pay their pro rata portion of fund expenses, as well as
any class expenses attributable to Institutional Class shares only. Class
expenses include, but are not limited to, transfer agent fees and
administrative and shareholder fees and expenses such as the cost of
registering shares under state laws, the cost of typesetting, printing and
distributing shareholder reports and prospectuses.
When a cost is shared by several funds, the staff at Citizens Advisers
will allocate the expense in a reasonable manner under the supervision of the
Board of Trustees. For the year ended June 30, 1998, the following expense
ratios were paid by the funds after waivers and reimbursements (based on
average annual net assets of the respective funds): Working Assets Money Market
Fund, 1.21%; Citizens Income Fund, 1.74%; Citizens Index Fund, 1.59%; Citizens
Emerging Growth Fund, 1.96%; Citizens Global Equity Fund, 2.20%; Working Assets
Money Market Fund (Institutional Class shares), 0.56%; Citizens Index Fund
(Institutional Class shares), 0.88%.
For the Working Assets Money Market Fund (Standard shares) and Citizens
Income Fund, Citizens Advisers has agreed to reimburse the funds if costs
exceed a specified limit in the ordinary course of business. Please see the
Statement of Additional Information for a full description.

12b-1 Fees
Citizens Funds has a 12b-1 plan which allows us to reimburse Citizens
Securities and other distributors of the funds' shares for sales-related costs.
These costs include the printing of prospectuses and reports sent to

<PAGE>

non-shareholders, as well as other sales material, advertising and salaries for
salespeople and other personnel. We also will pay commissions to outside
brokers or service organizations for similar services. Sometimes Citizens
Securities makes additional promotional expenditures that are not reimbursed by
the 12b-1 plan, such as expense reimbursements to broker-dealers for meetings,
advertising and other valid promotional purposes.

Amounts reimbursed to Citizens Securities for fiscal year ended June 30, 1998:
Working Assets Money Market Fund (Standard shares) $188,875
Citizens Income Fund 111,606
Citizens Index Fund (Standard shares) 672,502
Citizens Emerging Growth Fund 185,324
Citizens Global Equity Fund 92,998

During fiscal 1998 there were no 12b-1 expenses assessed to Citizens Index
Fund Institutional Class shares. (Working Assets Money Market Fund
Institutional Class shares are not subject to 12b-1 fees.)

How to Purchase and Redeem Shares
How to Buy Shares
It's easy to buy shares in any of our funds. Just fill out an application
and send in your payment by check, wire transfer, exchange from another
Citizens mutual fund or through arrangements with your investment adviser or
broker-dealer. All checks must be made payable to "Citizens Funds." Foreign
checks drawn in U.S. dollars are accepted but shares purchased with foreign
checks may be held in escrow for at least 20 days.
Shares in Working Assets Money Market Fund cost $1.00 per share. For all
other funds, your cost will be the Net Asset Value next determined after your
payment is received. (Net Asset Value is determined at the close of the New
York Stock Exchange.) You can purchase both full and fractional shares, which
will be rounded to the nearest 1/1000th of a share. If your purchase is
returned for any reason, you will be assessed a fee of $15.00.

Investment Minimums
We encourage every investor to make a minimum investment of $2,500 per
fund ($1,000 for Eofund Accounts). Shareholders who sign up for our Automatic
Investment Plan can start with an investment balance as low as $250, with an
automatic investment of $50 per month. If your account falls below the minimum
per fund, you will be assessed a monthly fee of $3.00 until you bring your
balance back up over the minimum. If you do not bring your balance up to the
minimum, we may close your account by sending you a check for your balance.
The minimum initial investment in Institutional Class shares (Working
Assets Money Market Fund and Index Fund only) is $100,000. For registered
investment advisers, the minimum initial investment in Institutional Class
shares is $250,000. There is no minimum subsequent investment. With respect to
accounts that fall below $100,000 (or $250,000 for registered investment
advisers), Citizens Funds reserves the right to transfer these accounts from
the Institutional Class and convert them to Standard shares. We will give
adequate notice to the shareholder, allowing the opportunity to bring the
account up to the required minimum balance.

<PAGE>

Automatic Investment Plan
To enroll in our Automatic Investment Plan, simply check off that box on
the account application and provide us with your bank information, as well as
the amount and frequency of your investment into your chosen fund. We will do
the rest.

Payroll Deduction
Setting up direct payroll deposit is very easy. Call us for the necessary
information and steps to follow. If you or your payroll administrator have any
questions, please call our Shareholder Service Department.
Funds will be deposited into your account using the Electronic Funds
Transfer System. We will provide the account number. Your payroll department
will let you know the date of the pay period when your investment begins.

Telephone Redemption
We have a Telephone Exchange and Redemption option on your account
application. Under this option, you can call and tell us how much you want to
redeem. Depending upon your instructions, we will deposit the amount of your
redemption into another Citizens Funds account, mail you a check or
electronically transfer your redemption to your pre-designated account.
Normally, we will send you your redemption on the next business day after we
receive your request. One-day wired funds cost $10, or we offer free two-day
service via the Automated Clearing House (ACH). You will earn dividends up to
and including the date when we receive your redemption request.
If you do select the Telephone Exchange and Redemption option, you should
be aware it may increase the risk of error or of an unauthorized party gaining
access to your account. For added security you may provide us with a Personal
Identification Number (PIN) which must be verified before processing all
telephone transactions, including balance verification. To keep these problems
to a minimum, we record all telephone calls. But please remember, neither
Citizens Funds, our Adviser nor our Transfer Agent will be responsible if we
properly act on telephone instructions we reasonably believe to be genuine.

Write a Check
When you open an account in the Working Assets Money Market Fund, we will
send you a book of 20 checks. Although these checks are payable through a
banking agent of Citizens Funds, your account is not FDIC insured, and your
shares are subject to fluctuations in value. You may write a check for any
amount. There is a $0.50 fee per check written in the Working Assets Money
Market Fund. There will be a $15.00 charge for any checks returned for any
reason.
The Working Assets Money Market Fund offers the Eofund Account as an
account option. The Eofund Account offers enhanced transactional features,
including free check writing and a MasterCard (R) debit card. It is available
for an annual fee of $35.00 and is not subject to the below minimum balance
fee.

Redeem Your Shares through Broker-Dealers
You may also redeem your shares through participating broker-dealers (who
may charge a fee for this service). Certain broker-dealers may have
arrangements with Citizens Funds that permit them to order redemption of shares
by telephone or other electronic communication.

<PAGE>

Requests for Redemption
If you do not use the Telephone Exchange and Redemption option, you can
still redeem your shares at any time, although the process will take longer.
Send us a written request together with a Medallion Signature Guarantee. We may
require further documentation from corporations, fiduciaries, retirement plans
and/or institutional investors.
We reserve the right to wait up to seven business days before accepting
redemption requests on any investments made by check and five business days for
purchases made by ACH transfer. Therefore, if you need your redemption proceeds
within seven business days of your purchase, please invest by wire.

Shareholder Services and Policies
Exchange Privilege
Since people's investment needs change over time, we provide for easy
exchanges among our funds at no charge. You may make an exchange at any time
and to any fund. Just call us or write us with your request.

Excessive Exchanges and Market Timing
Because excessive trading can lower a fund's performance and harm
shareholders, we reserve the right to temporarily suspend or permanently
terminate, with or without advance notice, the exchange privilege of any
investor who makes excessive use of the privilege (e.g., more than five
exchanges within a one year period). Your exchanges may also be restricted or
refused if we perceive a pattern of simultaneous orders affecting significant
portions of a fund's assets. In particular, a pattern of exchanges or other
transactions evidencing a so-called "market timer" investment strategy, because
they may be particularly disruptive to a fund, will likely result in a
termination of exchange privileges or closure of your account. You may still
redeem your shares or purchase new shares in the event that your exchange
privileges are suspended or terminated.

Systematic Withdrawal Plan
You can send us a written request to automatically redeem a portion of
your shares and make a regular monthly, quarterly or annual payment on your
behalf.

Making a Change in Your Account
After your account is set up, you may want to make a change in one of the
options or in the account title. We are pleased to assist, but to protect both
you and Citizens Funds from fraud, we may require a Medallion Signature
Guarantee from all registered owners of the accounts.

Tax-Sheltered Retirement Plans
Our distributor, Citizens Securities, has arranged for shareholders to
have access to qualified Individual Retirement Accounts (IRAs), Roth IRAs,
SIMPLE IRAs and 403(b) plans (non-profit employees). Our funds are suitable for
401k plans and other types of retirement plans as well. Call us for a brochure
and application.

Dividends, Distributions and Taxes
Unless you give us other instructions, we will automatically reinvest your
dividends and distributions at the net asset value, calculated on the payable
date.

<PAGE>

We also can pay your dividends and distributions to you by check or
electronic transfer through the Automated Clearing House to your bank account.
The details of your dividends and other distributions will be included on your
statement. Payments of dividends and distributions of capital gains, if any,
are declared and paid on the following schedule:

Dividend Capital Gains Paid
Declared Paid Long-term Short-term
<S> <C> <C> <C> <C>
Working Assets
Money Market Fund Daily Monthly None None
Citizens Income Fund Monthly Monthly Annually Annually
Citizens Emerging
Growth Fund Annually Annually Annually Annually
Citizens Index Fund Annually Annually Annually Annually
Citizens Global Equity Fund Annually Annually Annually Annually
</TABLE>

Working Assets Money Market Fund's Yield
Every business day, the Working Assets Money Market Fund quotes a "7-day
yield" and a "7-day effective yield." To calculate the 7-day yield, we take our
net investment income per share for the most recent 7 days, annualize it and
then divide by the net asset value per share (expected always to be $1.00) to
get a percentage. The "effective yield" assumes you have reinvested your
dividends.

Citizens Income Fund's Yield
To calculate yield, we start with net investment income per share for the
most recent 30 days and divide it by the maximum offering price per share on
the 30th day, then annualize the result assuming a semi-annual compounding.

Total Return and Other Quotations
For all funds except the Working Assets Money Market Fund, we start with
the total number of shares you can buy for $1,000 at the beginning of the
period. We then add all the additional shares you would have purchased within
the period with reinvested dividends and distributions (this takes into account
the particular fund's income, if any). Finally, we multiply the number of these
shares by the Net Asset Value on the last day of the period and divide the
result by the initial $1,000 investment to see our percentage gain or loss. For
periods of more than one year, we adjust the cumulative total return to get an
average annual total return.
When we quote our investment results, we sometimes will compare them to
unmanaged market indices such as the Dow Jones Industrial Average, Standard &
Poor's 500, Financial Times World Index, Lehman Brother Corporate Bond Index
and the Russell 2000, as well as other data and rankings from recognized
independent publishers or sources such as Donoghue's Money Fund Report, Money
Magazine, Mutual Funds Magazine, Kiplinger's Personal Finance Magazine, Co-Op
America Quarterly, The Green Money Journal, Bloomberg News, Morningstar, Inc.
and Lipper Analytical Services.

Valuation of Shares
To calculate our Net Asset Value, we add up the total assets of the
particular fund, subtract all liabilities, then divide by the number of shares

<PAGE>

outstanding. Since expenses differ for Institutional Class shares, the Net
Asset Value for Standard and Institutional Class shares vary and are computed
separately. To value money market securities, we use an accounting system
called the amortized cost method. This system is described in the Statement of
Additional Information.

Equity securities are valued at the closing price on the primary exchange
on which such securities are traded or on the principal over-the-counter market
on which such securities are traded, or, lacking any sales, at the last
available bid price for domestic securities and halfway between the bid and the
asked price for international securities. If no market quotation is available
for a given security (including restricted securities which are subject to
limitations on their sale), our Adviser will fairly value that security in good
faith pursuant to the policies established by Citizens Funds' board of
trustees. Fixed income investments are generally valued at the bid price for
securities. Securities maturing within 60 days normally are valued at amortized
cost, adjusted for market fluctuation, if any.
Securities may also be valued on the basis of valuations furnished by a
pricing service that uses both dealer-supplied evaluations and evaluation based
on analysis of market data or other factors if such valuations are believed to
reflect more accurately the fair value of such securities.

Tax Matters
The dividends you receive, whether paid in cash or reinvested in shares,
generally will be subject to federal income tax (and any applicable state or
local taxes) unless you are otherwise exempt from such taxes. Some dividends
received from non-money market funds may qualify for the dividends received
deduction for corporate shareholders. We will send you a complete statement
each January as to the federal tax status of dividends and distributions paid
by each fund during the previous calendar year.
Distributions of non-money market funds will reduce the fund's Net Asset
Value per share. If you purchase shares just before a fund makes a
distribution, therefore, you will pay the full purchase price for the shares
and then receive a portion of the purchase price back as a taxable
distribution.
A redemption of shares or an exchange for shares of another Citizens fund
ordinarily will be a taxable event and will give rise to a taxable gain or
loss. Please consult your own tax adviser for further information regarding the
federal, state and local tax consequences of an investment in Citizens Funds.

The Year 2000
Citizens Funds could be negatively impacted if its or its service
providers' computer systems are not programmed to accurately process
information on or after January 1, 2000. Citizens Funds and its service
providers are attempting to identify and resolve any potential issues connected
with the Year 2000 and believe that it is likely that these efforts will be
successful. The funds also may be adversely affected if the issuers in which
they invest do not solve their Year 2000 problems.

Trustee Profiles
Azie Taylor Morton, chair of the board of trustees, operates an investment
management firm and was the 36th Treasurer of the United States.
*Sophia Collier is Citizens Funds' former president and is the principal owner
and chair of the board of directors of our investment adviser, Citizens
Advisers.
*John Shields is Citizens Funds' current president and president and chief
executive officer of Citizens Advisers.

<PAGE>

Lokelani Devone is assistant general
counsel at DFS Group Limited, an international retail business group.
Juliana Eades is the executive director of the New Hampshire Community Loan
Fund, one of the country's oldest local community economic development
institutions.
William D. Glenn II is the executive director of Continuum HIV Day Services in
San Francisco.
Mitchell Johnson is president of M.A.J. Capital Management, a money management
firm.
Previously, he spent 21 years in a variety of executive positions at the
Student Loan Marketing Association (Sallie Mae).
*Robert B. Reich is a University Professor at Brandeis University and was the
22nd United States Secretary of Labor.
Ada Sanchez is the former director of the Public Service and Social Change
Program at Hampshire College.
*Interested person (inside trustee)

<PAGE>

PAGE 1 SIDEBAR

Citizens Funds
230 Commerce Way, Suite 300
Portsmouth, NH 03801
603-436-5152

For Broker-Dealer Sales & Service:
800-982-7200

Table of Contents

Fee Information 2

Financial Highlights 4

How We Select Our
Investments 8

Working Assets Money
Market Fund 9

Citizens
Income Fund 10

Citizens
Index Fund 11

Citizens Emerging
Growth Fund 12

Citizens Global Equity
Fund 13

Organization and
Management of
Citizens Funds 13

How to Purchase and
Redeem Shares 16

Mailing Address and
Wiring Instructions 17

<PAGE>

Shareholder Services
and Policies 18

Dividends, Distributions
and Taxes 19

Trustee Profiles 22

Shares of the funds are neither
insured not guaranteed by
the U.S. Government

[CITIZENS FUNDS LOGO]

800-223-7010
www.citizensfunds.com

PAGE 3 SIDEBAR

[PHOTO]

Joseph Keefe, Secretary of Citizens Funds, explains the financial highlights
table.

"On the following pages you will find detailed financial information on the
funds described in this prospectus, including the total return of each fund
over its years of operation. If you would like additional information,
including a detailed discussion of each fund's recent performance, you may call
Citizens Funds' toll-free number and request the 1998 Annual Report to
Shareholders, which we will send to you right away."

<PAGE>

PAGE 8 SIDEBAR

[PHOTO]

John Shields was appointed President of Citizens Funds on September 1, 1998.

"Ours is an increasingly complicated world. Too often, we create more problems
for ourselves by ignoring a basic human trait, common sense, which is the heart
of Citizens' social investment philosophy. As a 25-year veteran of the mutual
fund industry, I have gained a broad view and diverse set of experiences. With
this perspective, I am especially committed to Citizens' fundamental
philosophy: that a social and environmental screening process provides added
insight into a company's potential performance and, therefore, is a smarter and
potentially more profitable approach to investing."

PAGE 9 SIDEBAR

[PHOTO]

Laura Provost lead manager of the team that manages the Working Assets Money
Market Fund joined Citizens Advisers in 1997. Previously, she was a portfolio
manager with John Hancock Mutual Funds. "Our money market fund can be a good
vehicle for short-term cash management and for investors who need stability of
principal."

PAGE 10 SIDEBAR

[PHOTO]

The managing partner of our sub-adviser, Seneca Capital Management LLC, Gail
Seneca is the primary manager of the Citizens Income Fund.

"Since our goal is to achieve a reliable stream of monthly income, we analyze
carefully the credit quality of the debt we purchase."

<PAGE>

PAGE 11 SIDEBAR

[PHOTO]

Sophia Collier is the lead manager of the team that manages the Citizens Index
Fund, a member of our board of trustees and chair of the board of our adviser,
Citizens Advisers.

"We believe our social screening process helps us identify better-managed
companies, and that over time this will be reflected in the returns of the
Citizens Index Fund. The fund is also highly diversified, both by industry and
by holding some 300 individual companies. We think it presents a good core
holding for the long-term investor."

PAGE 12 SIDEBAR

[PHOTO]

Rick Little is the lead manager of the team that manages the Citizens Emerging
Growth Fund. "We are looking to build a portfolio of companies that have
special characteristics, and therefore have the ability to grow in their sales
and earnings at a rapid rate. These are the companies we hope can become `the
next Microsoft,' developing new and innovative products and services."

PAGE 13 SIDEBAR

[PHOTO]

Lilia Clemente is the Chair of Clemente Capital, Inc., and lead member of the
team that manages the Citizens Global Equity Fund. "As a person who was born in
the Philippines and who has traveled throughout the world as a global investor,
I believe global investment offers an opportunity to reduce risk and increase
returns by linking security and prosperity to the performance of an array of
markets and companies, instead of concentrating only in the U.S."

<PAGE>

PAGE 14 SIDEBAR

[PHOTO]

Azie Taylor Morton, Chair of our Board of Trustees, explains Citizens Funds'
relationship with its adviser.

"One of Citizens Funds' most important contracts is our Management Agreement
with Citizens Advisers. It states that Citizens Advisers has authority to
manage our funds and will provide all necessary office space, facilities,
equipment and personnel to do so."

PAGE 16 SIDEBAR

Voting Rights
Shareholders are entitled to one vote for each full share owned and a
fractional vote for fractional shares. If you have a joint account, each of the
account holders has authority to vote on behalf of the joint account. Shares of
each fund or class generally vote separately on matters of concern to that fund
or class. However, all shareholders of Citizens Funds vote together on the
selection of trustees and other matters as required by the Investment Company
Act of 1940, as amended. The holders of shares have no preemptive, conversion
or subscription rights, and voting rights are not cumulative. To save money, we
do not hold annual meetings. However, a meeting may be called by our trustees
or at the request of 10% of Citizens Funds' shares. We will assist shareholders
in communicating with one another to arrange such a meeting.

PAGE 17 SIDEBAR

Mailing and
Wiring Instructions

Regular U.S. Mail:
Please use the business reply envelope
provided with this prospectus, or mail to:
Citizens Funds
c/o PFPC Inc.
PO Box 8962
Wilmington, DE
19899-8962

Wiring Instructions:
PNC Bank, N.A.
Philadelphia, PA
ABA#: 031000053
For Further Credit A/C# 86-1030-3646
Shareholder
name/acct. number

<PAGE>

Overnight Delivery Package (i.e. Federal Express, UPS, Airborne Express):
No U.S.
Send to:
Citizens Funds
c/o PFPC Inc.
400 Bellevue Parkway
Suite 108
Wilmington, DE 19809

Phone: 800-223-7010

Please send only overnight delivery packages to the above address. Regular U.S.
Mail will not be accepted at this address and may be returned to you.

PAGE 18 SIDEBAR

Use the Eofund(R)
Debit Card:
Working Assets Money Market Fund offers a transaction account, the Eofund
Account, which is available through Citizens Funds' distributor, Citizens
Securities. Shareholders who use this account may request an optional
MasterCard(R) debit card and use it to redeem shares for cash at ATM machines,
or to make purchases at any retail location which accepts the debit card.

Account Policies

o PLEASE MAKE ALL CHECKS PAYABLE TO "CITIZENS FUNDS." WE ARE UNABLE TO ACCEPT
THIRD-PARTY CHECKS.
o We reserve the right to close your account for any lawful reason, including,
but not limited to, reasonable suspicion of fraud or other illegal activity
in connection with the account.

PAGE 19 SIDEBAR

Common Transactions That Require Medallion Signature Guarantees:
o Written request for redemption
o Changing your account title in any way
o Authorizing a telephone transaction for
the first time

<PAGE>

o Changing your predesignated
wire or ACH instructions
o Establishing or modifying a systematic
withdrawal plan
o Exchanges between accounts which do
not have identical titles
Eligible Guarantors:
o Commercial Bank
o Trust Company
o Savings Associations
o Credit Unions
o Members of domestic stock exchange
Note:
Notaries public are not eligible guarantors.

PAGE 20 SIDEBAR

Transfer Agent:
PFPC Inc.
400 Bellevue Parkway
Suite 108
Wilmington, DE 19809

Dividend Paying Agent: PFPC Inc.
400 Bellevue Parkway
Suite 108
Wilmington, DE 19809

Phone: 800-223-7010

PAGE 21 SIDEBAR

We try to demonstrate our commitment to your investment success by offering a
full family of socially responsible funds and providing you with a complete
range of convenient services including the following retirement services:

o Traditional and Roth IRAs
o SEP and SIMPLE IRAs
o 401k, 403b and 457 plans
o Rollover and transfer services

Please call our Shareholder Service Center for more information
800-223-7010

<PAGE>

PAGE 23 SIDEBAR

NOTES

PAGE 24 SIDEBAR

[CITIZENS FUNDS LOGO]

Printed on recycled paper with soy-based ink.

Working Assets is a registered trademark of Working Assets Funding Service.
Used under license.

The Talking Prospectus(TM) and Citizens Index(TM) are trademarks of Citizens
Advisers. Eofund(R) is a registered trademark of Citizens Advisers.

<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
OCTOBER 27, 1998

This Statement is not a prospectus and should be read in conjunction
with the Prospectus dated October 27, 1998, as it may be amended or
supplemented from time to time. A copy of the current Prospectus can
be obtained by calling (800) 223-7010, or by writing Citizens Funds,
230 Commerce Way, Suite 300, Portsmouth, NH 03801. This Statement and
the Citizens Funds Prospectus may be amended or supplemented from time
to time.

CITIZENS FUNDS

Working Assets Money Market Fund
(includes Institutional Class shares)
Citizens Income Fund
Citizens Emerging Growth Fund
Citizens Global Equity Fund
Citizens Index Fund
(includes Institutional Class shares)

TABLE OF CONTENTS PAGE

Citizens Funds 2
Investment Objectives and Policies 2
The Funds 3
Other Investment Techniques 8
Factors that Affect the Value of Our Investments 9
Turnover and Fund Transactions 10
The Value of Our Shares 11
Information About Our Yield and Total Return 13
Dividends and Distributions 16
Federal Taxes 16
Redemption Information 18
Trustees and Officers 19
Additional Information Regarding Citizens Advisers 21
Investment Advisory and Other Services 22
Additional Information 25
Voting Rights 25
Shareholder and Trustee Liability 25
Custodian 26
Auditors 26
Legal Counsel 26
Financial Statements 26
Appendix: Description of Ratings 28

<PAGE>

CITIZENs FUNDS

Citizens Funds (the "Trust") presently consists of five separate mutual
funds: Working Assets Money Market Fund (inception date 8/30/83), Citizens
Income Fund (inception date 6/10/92), Citizens Emerging Growth Fund (inception
date 2/8/94), Citizens Global Equity Fund (inception date 2/8/94), and the
Citizens Index Fund (inception date 3/3/95). On May 28, 1992 the Trust, which
had operated as a money market fund since 1983, changed its name from Working
Assets Money Fund to Working Assets Common Holdings. On October 5, 1995 the
Trust changed its name from Working Assets Common Holdings to Citizens
Investment Trust, and on July 14, 1998 it changed its name to Citizens Funds.

This Statement of Additional Information relates to all five funds; with
respect to the Working Assets Money Market Fund and the Citizens Index Fund, it
relates both to Standard shares and to Institutional Class shares.

INVESTMENT OBJECTiVES AND POLICIES

The following are fundamental investment policies followed by each of the
series of the Trust (each a "fund," and collectively, the "funds") which
supplement those listed in the Prospectus. Any policy identified as a
fundamental investment policy of a fund may be amended only with approval of
the holders of a majority of the outstanding shares of that fund as defined by
the Investment Company Act of 1940, as amended (the "1940 Act").

Each fund:

1. May not buy the securities of any company if the fund would then own
more than 10% of the total value of all of the company's outstanding
voting securities, or if the Trust as a whole would then own more than
10% of the total value of all of the company's outstanding voting
securities. A fund may not concentrate its investments by buying the
securities of companies in any one industry if more than 25% of the value
of total assets would then be invested in that industry; however,
obligations issued or guaranteed by the U. S. Government, its agencies
and instrumentalities, and obligations of domestic branches of domestic
banks, are not included in this limit.

2. May not invest in limited partnerships, including those which own
commodities, oil, gas and mineral leases or real estate. This restriction
is not interpreted to prevent a fund from investing in fixed income
securities or other debt instruments issued by limited partnerships
provided that it does not become a general or limited partner.

3. May not make loans other than pursuant to repurchase agreements. When
we buy money market instruments or loan participation interests, we are
investing, not making a loan.

4. May not invest for the purpose of exercising control or management of
other companies.

5. May not buy or continue to hold securities if our Trustees, officers or
the Directors or officers of Citizens Advisers, Inc. (the "Adviser") own
more than certain limits of these securities. If all of these people who
own more than 1/2 of 1% of the shares of a company together own more than
5% of the company's shares, we cannot buy, or continue to own, that
company's shares.

6. May not participate with others on a joint, or a joint and several,
basis in any trading account in any securities.

7. May not underwrite securities, which means we may not sell securities
for others.

<PAGE>

8. May borrow only under special circumstances. We do not normally borrow
money, but for temporary purposes a fund may borrow from banks up to 10%
of the fund's total assets. If we borrow, we can pledge our assets up to
the amount borrowed. A fund cannot borrow to purchase securities or to
increase its income, but can borrow to pay for shares being redeemed so
that we do not have to sell securities we do not want to sell. A fund will
not purchase any securities while the fund has borrowings above 5% of
assets outstanding. The interest paid on our borrowings would reduce our
net income.

9. Subject to the provisions of our Declaration of Trust, which provides
that we may issue several classes of shares in any one fund, we may not
issue senior securities. We may not issue securities that have priority
over others in dividends, redemption rights, or have other privileges. We
must limit our involvement in "illiquid instruments," that is, repurchase
agreements that have a term of more than seven days, and securities that
have restrictions on resale or lack readily available market quotations,
to 10% of the total value of a fund's net assets and we will buy no such
securities for a fund unless the assets in the fund exceed $10 million at
the time of purchase. Private Placements which may be traded pursuant to
Rule 144A under the Securities Act of 1933 will not be subject to these
limitations, if our Board of Trustees finds that a liquid trading market
exists for these securities. Our Trustees will review on an ongoing basis
any determination by the Adviser to treat a restricted security as a
liquid security, including the Adviser's assessment of current trading
activity and the availability of reliable price information. In
determining whether a privately placed security is properly considered a
liquid security, the Adviser and our Trustees will take into account the
following factors: (i) the nature of the security and the nature of the
marketplace trades (e.g., the time needed to dispose of the security, the
method of soliciting offers, and the mechanics of transfer); (ii) dealer
undertakings to make a market in the security; and (iii) the number of
dealers willing to purchase or sell the security and the number of other
potential purchasers. To the extent the fund invests in restricted
securities that are deemed liquid, the general level of illiquidity in the
fund may be increased if qualified institutional buyers become
uninterested in purchasing these securities or the market for these
securities contracts. Acquisitions of such liquid restricted securities
will be made from a list approved by our Trustees.

10. There is a limit on a fund's ability to loan fund securities. If a
fund loans securities, then it must maintain collateral at 100% of the
value of the securities and any collateral must be marketable on an
exchange.

The following is a fundamental policy for Working Assets Money Market
Fund, Citizens Income Fund, Citizens Global Equity Fund and Citizens Index Fund
but does not apply to the Citizens Emerging Growth Fund: a fund may place only
5% of its total assets in companies which have been in operation, including
operations of predecessors, for less than three years.

As a general policy, none of the funds will invest in real estate assets
or interests therein. This policy does not preclude a fund from investing in
debt instruments secured by real estate or holding interests in real estate
investment trusts or other real estate companies.

If a percentage restriction is adhered to at the time of investment, a
subsequent increase or decrease in a percentage resulting from a change in
values or assets will not constitute a violation of that restriction.

THE FUNDS

The following discussion elaborates on the description of each fund's
investment objectives and policies as contained in the Prospectus, including
any fundamental investment policies of a fund that supplement the fundamental
policies of the funds in the Prospectus.

<PAGE>

WORKING ASSETS MONEY MARKET FUND
The Working Assets Money Market Fund, as a fundamental investment policy,
may not buy any securities other than money market securities. Thus, the fund
cannot buy any commodities or commodity futures contracts, any mineral programs
or leases, any shares of other investment companies or any warrants, puts,
calls or combinations of these. The fund also may not buy real estate, or real
estate loans, but may buy money market securities even though the issuer
invests in real estate or interests in real estate.

The following are also present policies of the Working Assets Money Market
Fund, but may be changed by our Trustees without a vote of the shareholders of
the fund:

1. The fund may invest in variable amount master demand notes, which are
obligations that permit us to invest fluctuating amounts at varying rates
of interest pursuant to direct arrangements between us and the borrower,
subject to the 10% limitation referred to in paragraph 3 below. The
interest rates and amounts involved may change daily. We have the right to
increase the amount under the note at any time up to the full amount
provided by the note agreement, or to decrease the amount; and the
borrower may repay up to the full amount of the note without penalty.
Because these types of notes are direct arrangements between us and the
borrower, they generally will not be traded and there is no active
secondary market for these notes. However, they are redeemable on demand,
and thus immediately repayable by the borrower, at face value plus accrued
interest at any time. Our right to redeem is dependent on the borrower's
ability to pay principal and interest on demand. Accordingly, our Adviser
will consider and continuously monitor the earning power, cash flow and
other liquidity ratios of the borrower to assess its ability to meet its
obligations on demand. We will invest in these notes only if the Board of
Trustees or the Adviser determines that they present minimal credit risks
and are of comparable quality to commercial paper having the highest
rating of Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's
Ratings Group ("Standard & Poor's").

2. The fund may not invest more than 10% of its assets in time deposits
maturing in more than two business days but less than seven business days.

3. The fund will not enter into a repurchase agreement if it would cause
more than 10% of its assets to be subject to repurchase agreements having
a maturity of more than seven days; included in this 10% limitation would
be any illiquid securities (as described below). See "Other Investment
Techniques--Money Market Instruments and Repurchase Agreements."

4. The fund will not invest more than 10% of its net assets in illiquid
securities. Generally an illiquid security is any security that cannot be
disposed of promptly and in the ordinary course of business at
approximately the amount at which the fund has valued the instrument.
Subject to this limitation, our Trustees have authorized the fund to
invest in restricted securities, specifically privately placed commercial
paper, where such investment is consistent with the fund's investment
objective, and has authorized such securities to be considered to be
liquid to the extent the Adviser determines that there is a liquid
institutional or other daily market for such securities. For example,
restricted securities which may be freely transferred among qualified
institutional buyers pursuant to Rule 144A under the Securities Act of
1933 and for which a liquid institutional market has developed may be
considered to be liquid securities. See the discussion relating to the
purchase of illiquid securities in the section regarding the fundamental
investment policies of the funds under "Investment Objectives and
Policies" above.

5. The fund may not sell short or buy on margin and may not write put or
call options.

<PAGE>

QUALITY AND MATURITY OF SECURITIES. Because the Working Assets Money
Market Fund uses the amortized cost method of valuation (see "The Value of Our
Shares"), the fund will not purchase any instruments with a remaining maturity
of more than 397 days (approximately 13 months) or maintain a dollar-weighted
average maturity of the entire fund in excess of 90 calendar days. Except as
provided below, the maturity of a security is deemed to be the period remaining
until the date on which, in accordance with the terms of the security, the
principal amount must unconditionally be paid or, if called for redemption, the
date on which the redemption must be made. Obligations of U.S. Government
agencies and instrumentalities ("Government Securities") with variable rates of
interest which are adjusted no less frequently than every 762 calendar days are
deemed to have a maturity equal to the period remaining until the next
readjustment. Government Securities that are Floating Rate Securities, or
securities whose terms provide for adjustment of their interest rates when a
specified rate changes and whose market value can reasonably be expected to
approximate amortized cost, are deemed to have a remaining maturity of one day.
Variable Rate Securities, which are securities whose terms provide for
adjustment of their interest rate on set dates and whose market value can be
reasonably expected to approximate amortized cost, wherein the principal amount
must unconditionally be paid in 397 calendar days or less, are deemed to have a
maturity equal to the period remaining until the next readjustment of the
interest rate or the period remaining until the principal amount can be
recovered through demand, whichever is earlier. A Variable Rate Security
subject to a demand feature, wherein the principal amount is scheduled to be
paid in more than 397 calendar days, is deemed to have a maturity equal to the
longer of the period remaining until the next readjustment of the interest rate
or the period remaining until the principal amount can be recovered through
demand. A Floating Rate Security wherein the principal amount must
unconditionally be paid in 397 calendar days or less is deemed to have a
maturity of one day. A Floating Rate Security subject to a demand feature
wherein the principal amount is scheduled to be paid in more than 397 days, is
deemed to have a maturity equal to the period remaining until the principal
amount can be recovered through demand. A repurchase agreement is deemed to
have a maturity equal to the period remaining until the date on which the
repurchase of the securities is scheduled to occur or, where the agreement is
subject to demand, the notice period applicable to a demand for repurchase of
the securities. A portfolio lending agreement is deemed to have a maturity
equal to the period remaining until the date on which the loaned securities are
scheduled to be returned or, where the agreement is subject to a demand, the
notice period applicable to the demand.

The Working Assets Money Market Fund may not invest more than 5% of its
assets in securities of any one issuer, except for U.S. Government securities.
With respect to securities subject to a guarantee or demand feature, the fund
may not invest more than 10% of its assets in the institution that issued the
guarantee or demand feature unless the underlying security was issued by a
person who does not control or is not controlled by that institution.

The Working Assets Money Market Fund also may only invest in securities
which are rated in the top rating category by at least two nationally
recognized statistical rating organizations ("NRSROs"). Such securities are
called First Tier Securities. If only one NRSRO has rated a security, the fund
may purchase that security only if it is rated in that NRSRO's top rating
category and the acquisition is approved or ratified by the fund's Board of
Trustees. If a security is not rated by any NRSRO, the fund may purchase that
security only if the Adviser determines that it is of comparable quality to a
First Tier Security and the Board approves or ratifies the acquisition. If a
security is rated by more than two NRSROs, the fund may purchase that security
if it is rated in the top rating category by any two NRSROs and no more than
one other NRSRO rates it in the second highest category or lower. If a security
is subject to a guarantee or a conditional demand feature, the fund may
purchase the security only if the guarantee or conditional demand feature meets
the criteria set forth above or, in the case of a security subject to a
conditional demand feature and issued after February 10, 1998, only if the
Adviser determines and periodically confirms that there is minimal risk that
the conditions preventing exercise of the demand feature will occur and either
(a) the conditions limiting exercise can be readily monitored by the fund or
relate to the taxability of interest payments on the security or (b) the terms
of the conditional demand feature require that the fund will receive notice of
the occurrence of the condition and the opportunity to exercise the demand
feature.

<PAGE>

CITIZENS INCOME FUND
The objective of Citizens Income Fund is to provide as high a level of
current income as we believe to be consistent with prudent investment risk. We
invest in bonds and other debt securities which meet our financial and social
criteria. We intend to purchase primarily intermediate- and long-term
securities and to maintain a weighted average maturity of 5-15 years. However,
at times, we may have a longer or shorter weighted average maturity if we
believe it will help us meet our investment objective.

We plan to invest at least 65% of the value of the Citizens Income Fund's
assets in debt securities that are rated BBB or better by a NRSRO such as
Standard & Poor's or Moody's; unrated securities which we believe are
comparable in credit quality to securities rated BBB or better as described
above; obligations issued or guaranteed by the U.S. Government or its agencies
or instrumentalities; mortgages and other asset backed securities; other debt
securities or cash and cash equivalents. Up to 35% of the Citizens Income
Fund's total assets may be invested in fixed-income securities which do not
have the investment characteristics described above. Such debt securities could
include convertible debt securities, convertible preferred and preferred stocks
or other securities.

In pursuit of our investment objective we will sometimes purchase
securities that have warrants attached to them. Such warrants are typically
held on our books at a zero value when market quotations are unavailable, as
the value of these warrants can only be realized upon their exercise (see
"Other Investment Techniques--Warrants"). From time to time, we will also
purchase options to buy or sell securities in the future at values determined
by the performance of financial bench marks or indexes. The use of options can
add risk to the fund because the portfolio manager may determine that exercise
of the option will not benefit the fund and therefore, the amount invested to
acquire the option will be lost. Also, the fund may be required to purchase at
a disadvantage a security on which it has sold a put option We may also
purchase "structured securities," such as interest-only strips or similar
vehicles where one or more of the rights within the underlying securities has
been traded through the financial markets for a different right or series of
rights. A risk associated with "interest-only strips" is that the security may
prepay or default and our ability to collect interest payments will end.

The Citizens Income Fund may also invest in mortgage-backed securities.
There are risks associated with investing in mortgage-backed securities, as the
value of these investments may be adversely affected by prepayment of mortgages
or extension of the maturity of such mortgages. When interest rates go down,
mortgage-backed securities experience higher rates of prepayment, because the
underlying mortgages are refinanced to take advantage of the lower rates.
Therefore, the prices of mortgage-backed securities may not increase as much as
prices of other debt securities when interest rates decline, and
mortgage-backed securities may not be an effective means of locking in a
particular interest rate. In addition, any premium paid for a mortgage-backed
security may be lost when it is prepaid. When interest rates go up,
mortgage-backed securities experience lower rates of prepayment. This has the
effect of lengthening the expected maturity of a mortgage-backed security. As a
result, prices of mortgage-backed securities may decrease more than prices of
other debt obligations when interest rates go up.

The Citizens Income Fund is authorized to purchase the securities
described above from both U.S. and non-U.S. issuers (see "Other Investment
Techniques--Foreign Securities").

CITIZENS EMERGING GROWTH FUND
The objective of the Citizens Emerging Growth Fund is aggressive growth.
It attempts to achieve this objective through investment in small and medium
sized companies. During normal market conditions, up to 90% of this fund's
assets will be invested in companies with capitalization in the range of $75
million to $10 billion. While many of these companies will have already
demonstrated their strength, some will be still unseasoned, and therefore may
have some speculative characteristics. At times we will also buy short-term
fixed income securities as well as preferred stock for the Citizens Emerging
Growth Fund.

<PAGE>

The net asset value of this fund is subject to significant fluctuation.
Smaller companies have the potential for a much higher reward, as well as
significantly more risk. To moderate this risk we plan to typically hold
between 30-50 companies in the fund, under normal conditions.

Since most of the companies we will purchase are relatively new, we expect
dividend income to be negligible.

CITIZENS GLOBAL EQUITY FUND
The objective of the Citizens Global Equity Fund is capital appreciation.
It attempts to achieve this objective by investing in both foreign and U.S.
stocks. Investing in foreign companies and on international exchanges may
entail greater risk than investing solely in the United States (see "Other
Investment Techniques--Foreign Securities").

In the Citizens Global Equity Fund we buy primarily common stocks of U.S.
domestic and foreign companies. From time to time, we may also buy other
securities such as convertible or preferred stocks and short-term debt
securities. We plan to allocate over half our assets to foreign markets in most
circumstances in a minimum of three countries.

To moderate these risks as well as gain potential benefits we use a number
of investment techniques. The first of these is country selection. We restrict
our investments in emerging nations (those not included in Morgan Stanley's
World Index) to no more than 25% of the assets of Citizens Global Equity Fund.

When we invest on foreign exchanges we buy securities in the currency of
the local country. Often the local currency will fluctuate vs. the U.S. dollar.
To moderate this risk we engage in currency "hedging" when we feel it is
appropriate to protect the value of our fund. We do this by entering into
arrangements to buy or sell a particular currency, security, or securities
index for a stated value at a given point in time. Hedging strategies, if
successful, can reduce the risk of loss by wholly or partially offsetting the
negative effect of unfavorable price movements in the investment being hedged.
While there is a cost involved in hedging, we believe it allows us to moderate
the risk of currency exchange. However, hedging strategies can also reduce the
opportunity for gain by offsetting the positive effect of favorable price
movements in the hedged investments (see "Other Investment Techniques--Options
Transactions").

CITIZENS INDEX FUND
The objective of the Citizens Index Fund is long-term capital
appreciation. The Citizens Index Fund invests primarily in the securities
comprising the Citizens Index(TM), a market-weighted index of 300 companies,
approximately 200 of which are included in the Standard & Poor's Composite
Index of 500 Stocks ("S&P 500") that have passed Citizens' social screens, plus
an additional 100 companies that are not part of the S&P 500 but which pass our
social and financial screens. Companies outside the S&P 500 are included in the
Citizens Index to add industry diversity and other financial characteristics
which we believe are essential to a sound investment program.

Securities will be purchased in a proportion approximately equal to the
weight of each company to the total Index. At times we will also buy short-term
fixed income securities for the Citizens Index Fund. Under normal circumstances
these short-term investments will amount to no more than 5% of the fund's total
assets. Our investment results will usually lag the performance of the
underlying Citizens Index due to short-term cash investments and the deduction
of fund expenses and transaction costs.

<PAGE>

OTHER INVESTMENT TECHNIQUES

MONEY MARKET INSTRUMENTS AND REPURCHASE AGREEMENTS
During periods of unusual market conditions, or for liquidity purposes or
pending the investment of the proceeds of the sale of its shares, we may invest
all or a portion of the assets of the Citizens Income Fund, Citizens Emerging
Growth Fund, Citizens Global Equity Fund, Citizens Index Fund, and Working
Assets Money Market Fund in money market instruments, including: obligations of
agencies and instrumentalities of the U.S. Government; certificates of deposit
of banks; and commercial paper or other corporate notes of investment grade
quality. We may also enter into repurchase agreements with primary dealers or
banks which are members of the Federal Reserve, secured by instruments issued
or guaranteed by the agencies or instrumentalities of the U.S. Government, the
values, including accrued interest, of which are equal to or greater than the
repurchase price agreed to be paid by the seller. The repurchase price may be
higher than the purchase price, the difference being income to the fund, or the
purchase and repurchase prices may be the same, with interest at a standard
rate due to the fund, together with the repurchase price on repurchase. In
either case, the income to the fund is unrelated to the interest rate on
securities collateralizing the repurchase. In the event of bankruptcy or other
default by the vendor of a repurchase agreement, there may be possible delays
and expenses in liquidating the resold securities, decline in the value of the
resold securities and loss of principal or interest.

OPTIONS TRANSACTIONS
Each fund, other than Working Assets Money Market Fund, may from time to
time buy and write (sell) call and put options on securities, security indices,
and foreign currencies that are traded on recognized securities exchanges and
over-the-counter markets. A call option gives the holder (buyer) the right to
purchase a security or currency at a specified price (the exercise price) at
any time until or on a certain date (the expiration date). A put option gives
the purchaser of the option the right to sell, and the writer (seller) the
obligation to buy, the underlying security or currency at the exercise price at
any time until or on the expiration date. The premium that a fund receives for
buying or writing a call or put option is deemed to constitute the market value
of an option. Aggregate premiums paid for put and call options will not exceed
5% of the fund's total assets at the time of each purchase. The premium that a
fund will receive from writing a call option will reflect, among other things,
the current market price of the underlying investment, the relationship of the
exercise price to such market price, the historical price volatility of the
underlying investment, and the length of the option period. These instruments
are often referred to as "derivatives" which may be defined as financial
instruments whose performance is derived, at least in part, from the
performance of another asset (such as a security, currency or an index of
securities). The funds may use these techniques to hedge against changes in
interest rates, foreign currency exchange rates, changes in securities prices
or other factors affecting the value of their investments, or as part of their
overall investment strategies. Each fund will maintain segregated accounts
consisting of liquid assets (or, as permitted by applicable regulations, enter
into certain offsetting positions to cover its obligations under derivatives
transactions) to avoid "leveraging" the fund.

Risks in the use of these derivative securities depends on the Adviser's
ability to predict correctly the direction of interest rates, securities prices
or other factors. Risks include: a) the risk that interest rates, securities
prices or other factors do not move in the directions being hedged against, in
which case the fund will have incurred the cost of the derivative (either its
purchase price or, by writing an option, losing the opportunity to profit from
increases in the value of the securities covered) with no tangible benefits; b)
an imperfect correlation between the price of derivatives and the movements of
the securities prices, interest rates or currency exchange rates being hedged;
c) the possible absence of a liquid secondary market for any particular
derivative at any time; d) the potential loss if the counterparty to the
transaction does not perform as promised; and e) the possible need to defer
closing out certain positions to avoid adverse tax consequences.

<PAGE>

WARRANTS
Citizens Income Fund may invest in warrants. Warrants are instruments
which entitle the holder to buy underlying equity securities at a specific
price for a specific period of time. A warrant tends to be more volatile than
its underlying securities and ceases to have value if it is not exercised prior
to its expiration date. In addition, changes in the value of a warrant do not
necessarily correspond to changes in the value of the underlying securities.

FOREIGN SECURITIES
Each fund may invest in foreign securities which meet our social and
financial criteria. As discussed in the Prospectus, investing in foreign
securities generally presents a greater degree of risk than investing in
domestic securities due to possible exchange rate fluctuations, less publicly
available information, more volatile markets, less securities regulation, less
favorable tax provisions, war or expropriation. As a result of its investments
in foreign securities, a fund may receive interest or dividend payments, or the
proceeds of the sale or redemption of such securities, in the foreign
currencies in which such securities are denominated. Under certain
circumstances, such as where we believe that the applicable exchange rate is
unfavorable at the time the currencies are received or we anticipate, for any
other reason, that the exchange rate will improve, a fund may hold such
currencies for an indefinite period of time. A fund may also hold foreign
currency in anticipation of purchasing foreign securities. While the holding of
currencies will permit the fund to take advantage of favorable movements in the
applicable exchange rate, such strategy also exposes the fund to risk of loss
if exchange rates move in a direction adverse to the fund's position. Such
losses could reduce any profits or increase any losses sustained by the fund
from the sale or redemption of securities and could reduce the dollar value of
interest or dividend payments received.

WHEN-ISSUED SECURITIES
Each fund, other than the Working Assets Money Market Fund , may purchase
securities on a "when-issued" or on a "forward delivery" basis. It is expected
that, in many cases, a fund purchasing securities on a when-issued basis, will
take delivery of such securities. When a fund commits to purchase a security on
a when-issued or on a forward delivery basis, it will set up procedures
consistent with current policies of the Securities and Exchange Commission (the
"SEC") concerning such purchases. Since that policy currently recommends that
an amount of a fund's assets equal to the amount of the purchase be held aside
or segregated to be used to pay for the commitment, we intend that a fund will
always have cash, short-term money market instruments or high quality debt
securities sufficient to cover any commitments or to limit any potential risk.
However, although we do not intend to make such purchases for speculative
purposes and we intend to adhere to current regulatory policies with respect to
such purchases, purchases of securities on such bases may involve more risk
than other types of purchases. For example, we may have to sell assets which
have been set aside to cover our commitments in order to meet redemptions.
Also, if we were to determine that it is necessary to sell the when-issued or
forward delivery securities before delivery to a fund, the fund may incur a
loss because of market fluctuations since the time the commitment to purchase
such securities was made. When the time comes to pay for when-issued or forward
delivery securities, a fund will meet its obligations from the then-available
cash flow on the sale of securities, or, although it would not normally expect
to do so, from the sale of the when-issued or forward delivery securities
themselves (which may have a value greater or less than the fund's payment
obligation).

FACTORS THAT AFFECT THE VALUE OF OUR INVESTMENTS

MONEY MARKET INSTRUMENTS AND FIXED INCOME SECURITIES
The value of the fixed income securities in which we invest will
fluctuate depending in large part on changes in prevailing interest rates.
Fixed income securities comprise all assets in the Working Assets Money Market
Fund and Citizens Income Fund and a portion of assets in the Citizens Emerging
Growth Fund, Citizens Index Fund and Citizens Global Equity Fund under normal
conditions. If these rates go up after we buy a security, its value may go

<PAGE>

down. On the other hand, if the rates go down, the security's value may go up.
Changes in value and yield based on changes in interest rates may have
different effects on short-term obligations than on long-term obligations.
Long-term obligations, which often have higher yields, may fluctuate in value
more than short-term ones. We do not expect changes in interest rates to
significantly affect the value of our shares in the Working Assets Money Market
Fund, since we use the amortized cost method, which is described in the section
"The Value of Our Shares." However, changes in interest rates can have a
significant effect on the value of non-money market fixed income securities.

The value of equity securities held in the Citizens Emerging Growth,
Global Equity and Index Funds will fluctuate based upon market conditions and
issues specific to the issuer. These include changes in the management and
fundamental financial condition of the issuing company, prevailing economic and
competitive conditions in the industry sectors in which the company does
business and other factors which affect individual securities and the equity
market as a whole.

TURNOVER AND FUND TRANSACTIONS

With regard to the Working Assets Money Market Fund, we generally purchase
investments and hold them until they mature. Historically, securities of U.S.
Government agencies or instrumentalities have involved minimal risk when they
have been held by investors to maturity. However, we may from time to time sell
securities and purchase others to attempt to take advantage of short-term
market variations. We may also sell securities prior to maturity to meet
redemptions or as a result of a revised evaluation of the issuer by our
Adviser.

For the Citizens Income Fund we purchase fixed income securities and for
Citizens Emerging Growth Fund, Citizens Global Equity Fund and the Citizens
Index Fund, we may purchase both equity and fixed income securities and hold
them until such time as we believe it is advisable to sell them in order to
realize a gain or loss whereupon we reinvest these assets in other securities.

Portfolio turnover rates will vary, depending on the type of fund and its
particular investment objective. For example, the Citizens Index Fund seeks to
have a turnover rate of less than 20% per year, whereas the Citizens Emerging
Growth Fund's turnover rate may be in excess of 200%. Higher portfolio turnover
rates increase transaction costs and may increase taxable gains. For the fiscal
years ended June 30, 1996, 1997 and 1998, the funds had the following portfolio
turnover rates: Citizens Income Fund -- 41.36%, 64.56% and 80.14%; Citizens
Emerging Growth Fund -- 337.41%, 228.66% and 245.30%; Citizens Global Equity
Fund -- 85.92%, 69.34% and 72.33%; Citizens Index Fund -- 6.44%, 18.64% and
13.64%, respectively.

Our Adviser seeks to obtain for us the best net price and the most
favorable execution of orders. Purchases are made from issuers, underwriters,
dealers or brokers, and banks who specialize in the types of securities we buy.
Purchases from underwriters include a commission or concession paid by the
issuer to the underwriters. Purchases from dealers include the spread between
the bid and asked prices and purchase from brokers include commissions paid to
the broker based upon the transaction size. If the execution and price offered
by more than one dealer are comparable, the order may be given to a dealer who
has provided research advice, quotations on portfolio securities or other
services. Our Adviser will comply with Rule 17e-1 under the 1940 Act in regards
to brokerage transactions with affiliates, to assure that commissions will be
fair and reasonable to the shareholders.

Our Adviser may allocate transactions to broker/dealers in exchange for
services. By allocating transactions to obtain services, the Adviser is able to
supplement its own efforts. While it is not possible to place a dollar value on
these services, it is the opinion of the Adviser that the receipt of these
services does not materially reduce the Adviser's overall expenses. These
services may or may not be useful to us or to our Adviser and its affiliates
which engage in securities activities. For the fiscal years ended June 30,
1996, 1997 and 1998, all portfolio purchases, as described above, were made
directly from issuers or from dealers, and we paid commissions in aggregate as
follows: 1996-$171,957, 1997-$323,948 and 1998-$417,008.

<PAGE>

It is the policy of Citizens Advisers and Citizens Funds to seek to obtain
the benefit of "soft dollar" payments for the funds and other clients of
Citizens Advisers when consistent with obtaining best execution and when doing
so is within the "safe harbor" created by Section 28(e) of the Securities
Exchange Act of 1934. To that end, Citizens Advisers will maintain an account
with one or more broker-dealers who agree to provide or pay for brokerage and
research services which benefit the funds. Sub-advisers will be informed in
writing of the names of the broker-dealers and provided with account
information to allow the execution of trades through those broker-dealers. In
the event that best execution of an equity transaction is available through a
broker-dealer which has been so identified, Citizens Advisers or a sub-adviser,
as the case may be, may place the transaction with that broker-dealer after
determining in good faith that the amount of the commission is reasonable in
relation to the value of the brokerage and research services provided.

Any "soft dollars" generated in this fashion shall be used solely to
purchase brokerage and research services within the meaning of Section 28(e),
and must be of benefit to the fund on whose behalf the transaction is made.
Such brokerage and research services, however, need not exclusively benefit the
fund on whose behalf the transaction is made, and may also benefit other funds
within Citizens Funds or other clients of Citizens Advisers or its
sub-advisers. For these purposes, brokerage and research services mean those
which provide assistance to Citizens Advisers, or a sub-adviser, in the
performance of decision-making responsibilities. If a product or service serves
non-research as well as research functions, "soft dollars" shall be used to pay
for the product or service only to the extent that it constitutes research.

The investment management or advisory fee that Citizens Funds pays to the
Adviser will not be reduced as a consequence of the Adviser's receipt of
brokerage and research services. While such services are not expected to reduce
the expenses of the Adviser, the Adviser would, through the use of such
services, avoid the additional expenses which would be incurred if it should
attempt to develop comparable information through its own staff or obtain such
services independently.

THE VALUE OF OUR SHARES

The value of our shares is expressed as net asset value. The net asset
value per share is computed by subtracting total liabilities from total assets
and dividing that number by the total number of our outstanding shares. All
expenses are accrued daily and taken into account in determining net asset
value. Since these expenses differ for Institutional Class shares, the net
asset value of standard and Institutional Class shares will vary and are
computed separately.

We attempt to keep the net asset value of our Working Assets Money Market
Fund fixed at $1.00 per share, while we expect the net asset value per share in
our other funds to fluctuate.

The value of our shares for each fund, other than the Working Assets Money
Market Fund, is determined at the time the New York Stock Exchange closes on
each day on which the New York Stock Exchange is open for regular trading and
at such other times as we feel may be necessary or appropriate.

The value of our shares for the Working Assets Money Market Fund is
determined at 4:00 p.m. Eastern Time on each day that the fund is open. The
funds are currently open on each day, Monday through Friday, except New Year's
Day, Martin Luther King, Jr's. Birthday (observed), Presidents' Day (observed),
Good Friday, Memorial Day (observed), Independence Day, Labor Day, Columbus
Day, Veterans Day, Thanksgiving Day, the Friday following Thanksgiving Day and
Christmas Day.

WORKING ASSETS MONEY MARKET FUND
Our Trustees have determined that it is appropriate for us to value our
Working Assets Money Market Fund using the amortized cost method and that this
method represents the fair value of the fund's shares. This method values a
security at the time of its purchase at cost and thereafter assumes a constant

<PAGE>

amortization to maturity of any discount or premium, regardless of the impact
of fluctuating interest rates on the market value of the security. This method
does not take into account unrealized gains and losses.

While the amortized cost method provides certainty in valuation, there may
be periods during which value, as determined by the amortized cost method, is
higher or lower than the price we would receive if we sold the instrument.
During periods of declining interest rates, the daily yield on our shares may
tend to be higher than a like computation made by a fund with identical
investments which uses a method of valuation based on market prices. Thus, if
the use of amortized cost by us on a particular day resulted in a lower
aggregate fund value than were we to value at market prices, a prospective
investor in our shares would be able to obtain a somewhat higher yield from us
than he would from a fund valued at market price. The converse would apply in a
period of rising interest rates.

To use the amortized cost method, our Board of Trustees must establish
procedures designed to stabilize the net asset value of the Working Assets
Money Market Fund at $1.00 per share, to the extent reasonably possible. These
procedures must include review of the fund by the Board at intervals it deems
appropriate and reasonable in the light of market conditions to determine how
much the net asset value using available market quotations deviates from the
net asset value based on amortized cost. For this purpose, when market
quotations are available, securities are valued at the mean between the bid and
the asked price. If market quotations are not available, investments are valued
at their fair value as determined in good faith under procedures established by
and under the general supervision and responsibility of our Board of Trustees,
including being valued at prices based on market quotations for investments of
similar type, yield and maturity.

Under the procedures which our Trustees have adopted in connection with
the valuation of our securities using the amortized cost method, the fund,
through its Custodian, conducts weekly mark-to-market appraisals to compare its
determination of Net Asset Value per share with the amortized cost-based net
asset value. In the event of a deviation between the market value and the
amortized cost value in excess of 0.10%, or if the Adviser believes the
deviation may result in dilution or other unfair results to shareholders or
investors, the Board of Trustees must be notified and daily mark-to-market
appraisals will be conducted until the deviation falls below 0.10%. If the
deviation exceeds 0.30%, the Board of Trustees must be notified and may
consider taking remedial action. If the deviation exceeds 0.50%, the Board of
Trustees will take such action as it deems appropriate to eliminate or reduce
any material dilution of shares or other unfair results to shareholders or
investors, including without limitation: redeeming shares in kind; selling
securities prior to maturity to realize capital gains or losses or to shorten
the average maturity of the fund; withholding dividends or payment of
distributions; determining Net Asset Value per share utilizing market
quotations or equivalents; reducing or increasing the number of shares
outstanding on a pro rata basis; offsetting each shareholder's pro rata portion
of the deviation from their accrued dividend account or from future dividends;
or some combination of the foregoing.

We also limit our investments, including repurchase agreements, to those
U.S. Dollar-denominated securities which the Adviser determines to present
minimal credit risks to the fund, which are First Tier Securities and which
meet the maturity and diversification requirements set forth in Rule 2a-7 and
included herein (see pages 7-8 above).

CITIZENS INCOME FUND, CITIZENS EMERGING GROWTH FUND, CITIZENS GLOBAL
EQUITY FUND AND THE CITIZENS INDEX FUND
As described in the Prospectus, the Citizens Income Fund, Citizens
Emerging Growth Fund, Citizens Global Equity Fund and Citizens Index Fund are
generally valued on the basis of market values. Equity securities are valued at
the last sales price on the primary exchange on which such securities are
traded or on the principal over-the-counter market on which such securities are
traded, or, lacking any sales, at the last available bid price for domestic
securities and halfway between the bid and asked price for international
securities. Fixed income investments are generally valued at the bid price for
securities. Securities maturing within 60 days are normally valued at amortized
cost, adjusted for market fluctuation, if any. Securities and other assets for
which market quotations are not readily available (including restricted
securities, if any) are appraised at their fair value as determined in good
faith under consistently applied procedures under the general supervision of
the Trust's Board of Trustees.

<PAGE>

Securities may also be valued on the basis of valuations furnished by a
pricing service that uses both dealer supplied valuations and evaluation based
upon analysis of market data or other factors if such valuations are believed
to reflect more accurately the fair value of such securities.

Use of a pricing service has been approved by the Trust's Board of
Trustees. There are a number of pricing services available, and the Trustees
and officers of the Trust acting on behalf of the Trustees, may use or
discontinue the use of any pricing service now, or in the future, employed.

INFORMATION ABOUT OUR YIELD AND TOTAL RETURN

We report the investment performance of each fund in several ways. All
performance reported in advertisements is historical and not intended to
indicate future returns.

YIELD
From time to time the "yield" and "compounded effective yield" of our
funds may be published in advertisements and sales material. For Citizens
Income Fund we usually report for a 30 day period, whereas for the Working
Assets Money Market Fund the yield is usually quoted for a seven day period.

The yield quotation for the Citizens Income Fund is based on the annualized net
investment income per share of the fund over a 30-day (or one-month) period.
The yield is calculated by dividing the net investment income per share of the
fund earned during the period by the public offering price per share of the
fund on the last day of that period. The resulting figure is then annualized.
Net investment income per share is determined by dividing (i) the dividends and
interest earned by the fund during the period, minus accrued expenses for the
period, by (ii) the average number of the fund's shares entitled to receive
dividends during the period multiplied by the public offering price per share
on the last day of the period. Income is calculated for the purposes of yield
calculations in accordance with standardized methods applicable to all stock
and bond funds. In general, interest income is reduced with respect to bonds
trading at a premium over their par value by subtracting a portion of the
premium from income on a daily basis and is increased with respect to bonds
trading at a discount by adding a portion of the discount to daily income.
Capital gains and losses are generally excluded from the calculation as these
are reflected in the fund's net asset value per share. Expenses accrued for the
period include any fees charged to all shareholders during the base period.

The Citizens Income Fund's yield is calculated according to the following SEC
formula:

Yield = 2[(a-b + 1)6 - 1]
cd
where:
a = interest earned during the period
b = expenses accrued for the period (net of reimbursements)
c = the average daily number of shares outstanding during the period that were
entitled to receive income distributions
d = the maximum offering price per share on the last day of the period

The current yield of the Working Assets Money Market Fund for a specific
period of time is calculated based on a hypothetical account containing exactly
one share at the beginning of the period. The net change in the value of the
account during the period is determined by subtracting this beginning value
from the value of the account at the end of the period including a hypothetical
charge reflecting deductions from shareholder accounts. Capital changes (i.e.,
realized gains and losses from the sale of securities and unrealized
appreciation and depreciation) are excluded from the calculation. Because the
change will not reflect any capital changes, the dividends used in the yield
computation may not be the same as the dividends actually declared. The
dividends used in the yield calculation will be those which would have been
declared if there had been no capital changes included in our actual dividends.
The net change in the account value is then divided by the value of the account
at the beginning of the period and the resulting figure is called the "base

<PAGE>

period return." The base period return is then multiplied by (365/7) for a
seven day effective yield with the resulting yield figure carried to the
nearest hundredth of one percent.

Compounded effective yield, which may be quoted for the Working Assets
Money Market Fund, is determined by taking the base period return (computed as
described above) and calculating the effect of assumed compounding. This is
accomplished by annualizing the base period return and assuming that dividends
earned are reinvested daily. Compounded effective yield is calculated by adding
1 to the base period return (which is derived in the same manner as discussed
above) raising the sum to a power equal to 365 divided by 7 and subtracting 1
from the result.

The formula for effective yield is:
[(base period return + 1) 365/7 - 1]

Compounded effective yield information is useful to investors in reviewing
the performance of our Working Assets Money Market Fund since the yield is
calculated on the same basis as those of other money market funds. However,
shareholders should take a number of factors into account in using our yield
information as a basis for comparison with other investments.

Since the Working Assets Money Market Fund is invested in short-term money
market instruments, our yield will fluctuate with money market rates.
Therefore, the compounded effective yield is not an indication of future
yields. Other investment alternatives such as savings certificates provide a
fixed yield if held full term, but there may be penalties if redeemed before
maturity, whereas there is no penalty for withdrawal at any time in the case of
our funds.

Current yield and effective yield, which are calculated according to a
formula prescribed by the SEC, are not indicative of the amounts that actually
may be paid to our shareholders. Amounts paid to shareholders are reflected in
the quoted current distribution rate. The current distribution rate is computed
by dividing the total amount of dividends per share we paid during the past
twelve months by a current maximum offering price. Under certain circumstances,
such as when there has been a change in the amount of dividend payout, or a
major change in investment policies, it might be appropriate to annualize the
dividends paid over the period such policies were in effect, rather than using
the dividends during the past twelve months. The current distribution rate
differs from the current yield computation because it may include distributions
to shareholders from additional sources (i.e., sources other than dividends and
interest, such as short-term capital gains), and is calculated over a different
period of time.

The following table sets forth various measures of performance for the
funds as of June 30, 1998:

FUND 7-DAY YIELD EFFECTIVE YIELD 30-DAY YIELD
<S> <C> <C> <C>

Working Assets Money Market 5.49% 5.64% NA
Fund (Standard shares)

Working Assets Money Market 5.85% 6.02% NA
Fund (Institutional Class shares)

Citizens Income Fund NA NA 4.23%
</TABLE>

TOTAL RETURN AND OTHER QUOTATIONS
We also can express the investment results in terms of "total return." We
do this for the Citizens Income Fund, Citizens Emerging Growth Fund, Citizens
Global Equity Fund and Citizens Index Fund to take account of fluctuations in

<PAGE>

share value in addition to income from interest and dividends. Total return
refers to the total change in value of an investment in the fund over a
specified period, while the yield calculation only reflects the income
component.

We compute total return by taking the total number of shares purchased by
a hypothetical $1,000 investment after deducting any applicable sales charge,
adding all additional shares purchased within the period with reinvested
dividends and distributions, calculating the value of these shares at the end
of the period, and dividing the result by the initial $1,000 investment. For
periods of more than one year, we adjust the cumulative total return to
calculate average annual total return during that period.

These figures will be calculated according to the SEC formula:
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 periods at the end of the 1, 5 or 10 year
periods (or fractional portion).

For the period ended June 30, 1998 the funds had the following
performance:

HYPOTHETICAL
INVESTMENT RETURN
5 YEAR AVERAGE ANNUAL ON $1,000 FOR THE
ONE YEAR AVERAGE ANNUAL TOTAL RETURN SINCE ONE YEAR PERIOD
FUND TOTAL RETURN TOTAL RETURN INCEPTION
<S> <C> <C> <C> <C>

Citizens Income Fund 10.49% 7.12% 7.67% $1,104.90
(6/10/92)

Citizens Emerging 33.05% N/A 22.21% $1,330.50
Growth Fund (2/8/94)

Citizens Global 21.75% N/A 14.23% $1,217.50
Equity Fund (2/8/94)

Citizens Index Fund 36.50% N/A 31.76% $1,365.00
(Standard shares) (3/3/95)

Citizens Index Fund 37.38% N/A 34.88% $1,373.80
(Institutional Class (1/25/96)
shares)
</TABLE>

When we quote each fund's yield or total return we are referring to its
past results and not predicting our future performance. We quote total return
for the most recent one year period as well as average annual total return for
the most recent five- and ten-year periods, or from the time when we first
offered shares, whichever is shorter. Sometimes we advertise our actual return
quotations for annual or quarterly periods or quote cumulative return for
various periods. When we do this, we also always present the standardized total
return quotations at the same time.

When we quote our investment results we sometimes will compare them to
unmanaged market indices such as the Dow Jones Industrial Average and the S&P
500, and other data and rankings from recognized independent publishers,
sources such as Donoghue's Money Fund Report, Money Magazine, Mutual Funds
Magazine, Kiplinger's Personal Finance Magazine, Co-Op America Quarterly, The
Green Money Journal, Bloomberg News, Morningstar, Inc., Lipper Analytical
Services and others.

DIVIDENDS AND DISTRIBUTIONS

WORKING ASSETS MONEY MARKET FUND
As described in the Prospectus, net income is determined and accrued daily
and paid monthly. This dividend is payable to everyone who was a shareholder at
4:00 p.m. Eastern time on the day the dividend is declared. Accordingly, when
shares are purchased dividends begin to accrue on the day the Transfer Agent
receives payment for the shares, provided that the payment is received by 4:00
p.m. Eastern time. When shares are redeemed, the shares are not entitled to a
dividend declared on the day of the redemption if the redemption request is
received by the Transfer Agentprior to 4:00 p.m. Eastern time. Dividends are
automatically reinvested in shares, at net asset value, unless a shareholder
otherwise instructs the Transfer Agent in writing. Shareholders so requesting
will be mailed checks in the amount of the accumulated dividends. For the
purpose of calculating dividends, our daily net investment income consists of:
(a) all interest income accrued on investments (including any discount or
premium ratably amortized to the date of maturity or determined in such other
manner as the Trustees may determine); and (b) minus all expenses accrued,
including interest, taxes and other expense items, amounts determined and
declared as dividends and reserves for contingent or undetermined liabilities,
all determined in accordance with generally accepted accounting principles; and
(c) plus or minus all realized and unrealized gains or losses on investments.

CITIZENS INCOME FUND
The Citizens Income Fund distributes to its shareholders monthly dividends
substantially equal to all of its net investment income. The fund's net
investment income consists of non-capital gain income less expenses. Net
realized short-term capital gains, if any, and net realized long-term capital
gains, if any, will be distributed by the fund at least annually. Dividends and
capital gains distributions are automatically reinvested at net asset value in
additional shares, unless a shareholder elects cash distributions. Cash
distributions will be paid at the close of the appropriate monthly or annual
period.

CITIZENS EMERGING GROWTH FUND, CITIZENS GLOBAL EQUITY FUND AND CITIZENS
INDEX FUND
The Citizens Emerging Growth Fund, Citizens Global Equity Fund and the
Citizens Index Fund normally declare and pay dividends substantially equal to
all net investment income annually. Net investment income consists of
non-capital gain income less expenses. Net realized short-term capital gains,
if any, and net realized long-term capital gains, if any, will be distributed
by the funds at least annually. Dividends and capital gains distributions are
automatically reinvested at net asset value in additional shares, unless a
shareholder elects cash distributions. Cash distributions will be paid
annually.

FEDERAL TAXES

STATUS AS A "REGULATED INVESTMENT COMPANY"
Each of the funds has elected to be treated and intends to qualify as a
"regulated investment company" under Subchapter M of the Internal Revenue Code
of 1986, as amended (the "Code"). We plan to continue this election in the
future for all of the funds.

To qualify for the tax treatment afforded a "regulated investment company"
under the Code, a fund must annually distribute at least 90% of its net
investment income and net short-term capital gains and meet certain
requirements with respect to sources of income, diversification of assets, and
distributions to shareholders. If a fund elects and qualifies for such tax
treatment, the fund will not be subject to federal income tax with respect to
amounts distributed. Under current law, in order to qualify, a fund must (a)
derive at least 90% of its gross income from dividends, interest, payments with
respect to securities loans, gains from the sale or other disposition of stock
or securities, and income from certain other sources; and (b) diversify its
holdings so that, at the end of each fiscal quarter, (i) at least 50% of the
market value of the fund's assets is represented by cash, U.S. Government
securities, and other securities, limited, in respect of any one issuer, to an
amount not greater than 5% of the fund's assets and 10% of the outstanding
voting securities of such issuer, and (ii) not more than 25% of the value of
its assets is invested in the securities of any one issuer (other than U.S.
Government securities).

<PAGE>

A fund that qualifies as a "regulated investment company" may nonetheless
be subject to certain federal excise taxes unless the fund meets certain
additional distribution requirements. Under the Code, a nondeductible excise
tax of 4% is imposed on the excess of a regulated investment company's
"required distribution" for the calendar year ending within the regulated
investment company's taxable year over the "distributed amount" for such
calendar year. The term "required distribution" means the sum of (i) 98% of
ordinary income (generally net investment income) for the calendar year, (ii)
98% of capital gain net income (both long-term and short-term) for the one-year
period ending on October 31 (as though the one-year period ending on October 31
were the regulated investment company's taxable year), and (iii) the excess, if
any, of the sum of the taxable income of the regulated investment company for
the previous calendar year plus all amounts from previous years that were not
distributed over the amount actually distributed for such preceding calendar
year. The term "distributed amount" generally means the sum of (i) amounts
actually distributed by a fund from the fund's current year's ordinary income
and capital gain net income and (ii) any amount on which the fund pays income
tax for the year. We intend to meet these distribution requirements, to avoid
the excise tax liability, with respect to each of the funds. As long as a fund
maintains its status as a regulated investment company and distributes all of
its income, the fund will not be subject to any Massachusetts income or excise
tax. If a fund should fail to qualify as a regulated investment company in any
year, the fund would incur federal and Massachusetts income taxes upon its
taxable income and distributions from the fund would generally be taxable as
ordinary dividend income to shareholders.

DISTRIBUTIONS OF NET INVESTMENT INCOME
Dividends derived from net investment income and any excess of net
short-term capital gains over net long-term capital losses will be taxable to
shareholders as ordinary income. For each of the funds other than Working
Assets Money Market Fund and the Citizens Income Fund, a portion of these
ordinary income dividends is normally eligible for the dividends received
deduction for corporations if the recipient otherwise qualified for that
deduction with respect to its holding of a fund's shares. Availability of the
deduction to particular corporate shareholders is subject to certain
limitations and deducted amounts may be subject to the alternative minimum tax
and result in certain basis adjustments. Since the investment income of the
Working Assets Money Market Fund and the Citizens Income Fund is derived from
interest rather than dividends, no portion of the dividends received from these
funds will be eligible for the dividends received deduction. Moreover, the
portion of any fund's dividends that is derived from investments in foreign
corporations will not qualify for such deduction. Distributions of net capital
gains (i.e., the excess of net long-term capital gains over net short-term
capital losses) will be taxable to shareholders as long-term capital gains
without regard to the length of time that shareholders have held their shares.
Shareholders will be taxed for federal income tax purposes on dividends in the
same manner whether such dividends are received as shares or in cash. Any
dividend that is declared in October, November or December of any calendar
year, that is payable to shareholders of record in such a month and that is
paid the following January, will be treated as if received by shareholders on
December 31 of the year in which the dividend is declared.

Any dividend or distribution from a fund other than the Working Assets
Money Market Fund will have the effect of reducing the per share net asset
value of shares in the fund by the amount of the dividend or distribution.
Shareholders purchasing shares in such a fund shortly before the record date of
any taxable dividend or other distribution may thus pay the full price for the
shares and then effectively receive a portion of the purchase price back as a
taxable distribution.

In general, any gain or loss realized upon a taxable disposition of shares
of a fund by a shareholder that holds such shares as a capital asset will be
treated as a long-term capital gain or loss if the shares have been held for
more than twelve months and otherwise as a short-term capital gain or loss.
However, any loss realized upon a disposition of the shares in a fund held for
six months or less will be treated as a long-term capital loss to the extent of
any distributions of net capital gain made with respect to those shares. Any
loss realized upon disposition of shares may also be disallowed under the rules
relating to wash sales.

<PAGE>

Special tax considerations apply with respect to foreign investments of
those funds which permit such investments. For example, foreign exchange gains
and losses realized by a fund generally will be treated as ordinary income or
losses. In addition, investment income received by a fund from sources within
foreign countries may be subject to foreign income taxes withheld at the
source; none of the funds other than the Global Equity Fund expects to be able
to pass through to shareholders foreign tax credits with respect to such
foreign taxes. If the Global Equity Fund holds more than 50% of its assets in
foreign stock and securities at the close of its taxable year, it may elect to
"pass through" to its shareholders foreign income taxes paid. If the Global
Equity Fund so elects, its shareholders will be required to treat their pro
rata portions of the foreign income taxes paid by the fund as part of the
amounts distributed by them from the fund and thus includable in their gross
income for federal income tax purposes. Shareholders who itemize deductions
would then be allowed to claim a deduction or credit (but not both) on their
federal income tax returns for such amounts, subject to certain limitations.
Shareholders who do not itemize deductions would (subject to such limitations)
be able to claim a credit but not a deduction. No deduction for such amounts
will be permitted to individuals in computing their alternative minimum tax
liability. If the Global Equity Fund does not qualify or elect to "pass
through" to its shareholders foreign income taxes that it pays, shareholders
will not be able to claim any deduction or credit for any part of such taxes.
The United States has entered into tax treaties with many foreign countries
which may entitle a fund to a reduced rate of tax or an exemption from tax on
foreign income.

NON-U.S. SHAREHOLDERS
Dividends and certain other payments to persons who are not citizens or
residents of the United States or U.S. entities ("Non-U.S. Persons") are
generally subject to U.S. tax withholding at the rate of 30%. The funds intend
to withhold U.S. federal income tax at the rate of 30% (or at such lower rate
as may be permitted under an applicable treaty) on taxable dividends and other
payments to Non-U.S. Persons that are subject to such withholding. Any amounts
overwithheld may be recovered by such persons by filing a claim for refund with
the U.S. Internal Revenue Service within the time period appropriate to such
claims. Distributions from a fund to a Non-U.S. Person also may be subject to
tax under the laws of the Non-U.S. Person's jurisdiction.

The funds are also required in certain circumstances to apply backup
withholding at the rate of 31% on taxable dividends and (except in the case of
the Working Assets Money Market Fund) redemption proceeds paid to any
shareholder (including a Non-U.S. Person) who does not furnish to the fund
certain information and certifications or who is otherwise subject to backup
withholding. Backup withholding will not, however, be applied to payments that
have been subject to 30% withholding.

The foregoing is limited to a discussion of federal taxation. It should
not be viewed as a comprehensive discussion of the items referred to nor as
covering all provisions relevant to investors. Dividends and distributions may
also be subject to state or local taxes. Shareholders should consult their own
tax advisers for additional details on their particular tax status.

REDEMPTION INFORMATION

The redemption information below supplements the information contained in
the Prospectus. We pay redemption proceeds within five business days after we
receive a proper redemption request so long as the redemption request is
received by 4 p.m. Eastern Time. Our obligation to pay for redemptions can be
suspended when the New York Stock Exchange is closed other than for weekends or
holidays or under certain emergency conditions determined by the SEC. The
holidays on which the New York Stock Exchange is closed currently are: New
Year's Day, Martin Luther King, Jr's. Birthday (observed), Presidents' Day
(observed), Good Friday, Memorial Day (observed), Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. In addition, to the above mentioned
holidays, Working Assets Money Market Fund is also closed on Columbus Day and
Veterans Day. All funds are closed on the Friday following Thanksgiving Day. We
pay redemption proceeds in cash, except that our Board of Trustees has the
power to decide that conditions exist which would make cash payments
undesirable. In that case, we could send redemption payments in securities from
our portfolio, valued in the same method as we used to determine our net asset
value. There might then be brokerage or other costs to the shareholder in
selling these securities. We have elected to be governed by Rule 18f-1 under

<PAGE>

the 1940 Act, which requires us to redeem shares solely in cash up to the
lesser of $250,000 or 1% of our total net assets during any 90 day period for
any one shareholder. Your redemption proceeds may be more or less than your
cost, depending on the value of our shares.

If any of the shares being redeemed were recently purchased by check,
proceeds may not be made available for up to seven business days, and if
recently purchased by electronic funds transfer, proceeds may not be made
available for up to five business days, while we determine whether the check or
electronic funds transfer used to purchase the shares has been honored by the
bank on which it was drawn or made. You can eliminate any possible delay by
making your investment by wire.

We have the right to compel the redemption of shares of each fund if the
aggregate net asset value of the shares in the account is less than $2,500. If
our Adviser decides to do this, we will advise shareholders who would be
affected to increase the size of their accounts to the $2,500 minimum. With
respect to Institutional Class shares, we also have the right to transfer these
accounts and to convert them to Standard shares if the aggregate net asset
value of the shares in the account is less than $100,000 (or less than $250,000
for registered investment advisers).

<PAGE>

TRUSTEES AND OFFICERS

We have a Board of Trustees which provides broad supervision over our
affairs. Our officers are elected by the Board and are responsible for day to
day operations. The Trustees and officers are listed below, together with their
dates of birth and principal occupations during at least the past five years.
(Their titles may have varied during that period.) The address of each, except
where an address is indicated, is 230 Commerce Way, Suite 300, Portsmouth, New
Hampshire 03801.

The Trustees who are "interested persons," as defined in the 1940 Act
("Interested Trustees"), are indicated by an asterisk.

Azie Taylor Morton (2/1/36), Chair of the Board and Trustee, was Treasurer
of the United States during the Carter Administration. From 1984 - 1989, she
owned and operated the Stami Corporation, a franchisee of Wendy's Old Fashioned
Hamburgers. Her 30-year career began as a teacher at the State School for Girls
in Crockett, Texas. She went on to work at the AFL-CIO, the White House
Conference on Civil Rights and U.S. Equal Employment Opportunity Commission.
She has served as the Commissioner of the Virginia Department of Labor and
Industry as well as Executive Director of the Human Rights Project, Inc. From
1990 - 1992 she was Director of Resource Coordination at Reading is
Fundamental, Inc. She is currently an investment adviser. Address: 10910
Medfield Court, Austin, Texas 78739.

William D. Glenn, II (9/9/48), Trustee, has been a shareholder of Citizens
Funds since 1983. He is a psychotherapist and the Executive Director of
Continuum HIV Day Services in San Francisco. He is a past President of the San
Francisco AIDS Foundation and former member of the Board of Directors of the
Gay Rights Chapter of the Northern California American Civil Liberties Union.
From 1981 to 1988, Mr. Glenn was the Assistant Principal and Dean of Students
at Mercy High School in San Francisco. He currently serves on the boards of San
Francisco's KQED and the 18th St. Services Chemical Dependency Recovery Center.
Address: 915 Las Ovejas, San Rafael, California 94903.

Sophia Collier* (3/13/56), Trustee, is the former president of Citizens
Funds and of its investment adviser, Citizens Advisers, where she is the
principal owner and chair of the board of directors. Please see the section
entitled "Additional Information Regarding The Management Company" for more
information regarding Ms. Collier.

John L. Shields* (1/4/53), Trustee, became the President and Chief
Executive Officer of Citizens Funds on September 1, 1998. Prior to joining
Citizens Funds, Mr. Shields was a senior management consultant at Cerulli

<PAGE>

Associates in Boston, Massachusetts (1995-1998) and prior to that was employed
by State Street Research Investment Services, Inc., where he held positions as
Senior Vice President and Chief Administrative Officer, Chief Operating Officer
and Chief Financial Officer (1991-1995). Mr. Shields also held a number of
positions at Fidelity Investments (1987-1991) and was a Senior Audit Manager at
Deloitte & Touche in New York City (1974-1987). He is a 1974 graduate of St.
Peters' College and a member of the American Institute of Certified Public
Accountants.

Juliana Eades (2/2/53), Trustee, has served as Executive Director of the
$6 million New Hampshire Community Loan Fund since its inception in 1984. In
this capacity she has been a leading force in the creation of jobs and
affordable housing in New Hampshire. Prior to accepting her position at the
Loan Fund, Ms. Eades was Program Manager at the N.H. Governor's Council on
Energy. In other community activities, Ms. Eades is a member of the Campaign
for Rate Payers' Rights and the Society for the Protection of New Hampshire
Forests. Address: 79 South State Street, Concord, New Hampshire 03301.

Lokelani Devone (4/8/57), Trustee, is the Assistant General Counsel at DFS
Group Limited, an international retail business group where she has worked
since 1989. Prior to that, she was an aide to Congresswoman Nancy Pelosi,
D-California. She is also a member of the Board of Continuum HIV Day Services
in San Francisco, where Trustee William Glenn is employed. Ms. Devone is a
graduate of the University of California at Berkeley (B.A. 1978) and the
University of California, Davis (J.D. 1983) and was an International Research
Fellow at the University of Tokyo from 1983 to 1985. Address: 525 Market
Street, 33rd floor, San Francisco, California 94105.

Ada Sanchez (8/17/52), Trustee, is the former Director of the Public
Service and Social Change Program at Hampshire College. From 1985 - 1987 she
was the National Toxic Waste Campaign Coordinator for Greenpeace USA. Prior to
that Ms. Sanchez was involved with a number of activist organizations including
Western States Field Consultant for the Disarmament Program for the National
Fellowship of Reconciliation, co-director and founder of Viewpoint Syndicate,
lecturer for Progressive Foundation Speakers Bureau, national coordinator for
Supporters of Silkwood and outreach coordinator for Coalition for a Non-Nuclear
World. Address: 5416 Delette Avenue South, Gulfport, Florida 33707.

Robert B. Reich* (6/24/46), is University Professor and the Maurice B.
Hexter Professor of Social and Economic Policy at Brandeis University and its
Heller Graduate School. Before joining Brandeis, he served as the nation's 22nd
Secretary of Labor during President Bill Clinton's first term. Before heading
the Labor Department, Secretary Reich was on the faculty of Harvard
University's John F. Kennedy School of Government. He served as an assistant to
the Solicitor General in the Ford Administration, where he represented the
United States before the Supreme Court, and he headed the policy planning staff
of the Federal Trade Commission in the Carter Administration. Professor Reich
is the author of seven books, including The Work of Nations which has been
translated into 17 languages and most recently, Locked in the Cabinet, as well
as more than 200 articles on the global economy, the changing nature of work
and the centrality of human capital.

Mitchell Johnson (3/1/42), is President of M.A.J. Capital Management,
Inc., a money management firm which he organized in August 1994. Prior to
forming M.A.J. Capital, Mr. Johnson was employed for 21 years at the Student
Loan Marketing Association ("Sallie Mae"), where he served as Senior Vice
President of Corporate Finance (1987-1994); Vice President of Corporate Finance
(1984-1987); Vice President and Fiscal Agent (1982-1984); Manager of Banking
and Investments (1978-1982); and Portfolio Manager (1978-1978). Prior to
joining Sallie Mae, Mr. Johnson served as Financial Analyst for the Federal
Home Loan Bank Board, Office of Finance, from 1970-1973. Mr. Johnson is a
Director on the Board of Bank Commerce Security Bancorp, Inc., a Director of
the Federal Agricultural Mortgage Association (Farmer Mac) and a Trustee of the
District of Columbia Retirement Board. Mr. Johnson eared his B.A. degree from
the University of California at Los Angeles in 1965 and has attended American
University.

Our Board of Trustees functions with a Nominating Committee comprised of
the whole Board, but pursuant to our Distribution Plan (see "Our Distributor")
below, we have agreed that Trustees who are not "interested persons" of
Citizens Funds, as defined in the 1940 Act, and who have no direct or indirect

<PAGE>

financial interest in the operation of the Distribution Plan or any agreement
relating to the Plan ("Qualified Trustees") shall have responsibility for the
selection and nomination of other Qualified Trustees. This agreement will
continue for so long as our Distribution Plan is in effect.

The following compensation table discloses the aggregate compensation from the
Trust for services provided through June 30, 1998.

CITIZENS FUNDS- COMPENSATION TABLE

NAME OF PERSON AND POSITION AGGREGATE COMPENSATION FROM
CITIZENS FUNDS

Azie Taylor Morton $41,942.50
Juliana Eades $10,000
William D. Glenn, Jr. $11,750.00
Ada Sanchez $11,000.00
Lokelani Devone $10,000.00
Mitchell Johnson $5,000.00
Sophia Collier* 0
J.D. Nelson* 0
Robert B. Reich* 0

* Sophia Collier, J.D. Nelson and Robert B. Reich are Interested Trustees and
received no compensation from Citizens Funds.

The Trustees who are not "interested persons" received aggregate fees from us
of $89,692.50 for services provided through June 30, 1998 and were also
reimbursed for out-of-pocket expenses. Our Trustees and officers as a group
owned less than 1% of the outstanding shares of each fund and class as of
September 30, 1998, except for the Citizens Index Fund, Institutional Class
shares, where a single trustee owned 7.21% of the outstanding shares (see page
28 below).

OTHER OFFICERS OF THE TRUST
Crescentia True (12/16/63), Vice President, is the Vice President of
Operations of Citizens Advisers, where she has been employed since 1994. Sam
Pierce (4/21/68), Assistant Vice President, is Senior Analyst at Citizens
Advisers, which he joined in 1998. Prior to joining Citizens Advisers in 1998,
Mr. Pierce was employed by Wellington Management Co., LLC as Assistant Vice
President and Regulatory Analyst. Susan Barry (5/21/63), Treasurer, is
Controller of Citizens Advisers where she has been employed since 1992. Joseph
F. Keefe (9/30/53), Secretary, is Executive Vice President and General Counsel
of Citizens Advisers. Prior to joining Citizens Advisers in 1997, Mr. Keefe was
a partner in the law firm of Hall, Hess, Kenison, Stewart, Murphy & Keefe and
had been in private law practice for 16 years.

ADDITIONAL INFORMATION REGARDING CITIZENS ADVISERS

Sophia Collier individually owns 60% of the outstanding stock of Citizens
Advisers, Inc. Ms. Collier is the founder of American Natural Beverage Corp.,
the maker of Soho Natural Soda, a company which Ms. Collier co-founded in her
Brooklyn kitchen when she was 21 years old and built up over the next 12 years
to an enterprise with 52 employees and retail sales of $25 million. Soho Soda
was the first natural soda in America and was created as an alternative to
unhealthful mass market sodas. Ms. Collier and her partners sold American
Natural Beverage Corp. in 1989.

Four other individuals own the remaining 40% of the outstanding stock of
Citizens Advisers, Inc., as follows: John F. Dunfey (12%); Robert J. Dunfey,
Sr. (12%); Gerald F. Dunfey (12%); and William B. Hart, Jr. (4%). John, Robert

<PAGE>

and Gerald Dunfey, brothers, now serve as directors of the Dunfey Group, a
venture capital and investment firm. The Dunfey family has been associated,
over a number of years, with progressive social and political causes and has
actively participated in organizations dedicated to world peace, human and
civil rights, and economic justice. The family founded and continues to sponsor
New England Circle, a forum for the "discussion of social, political, literary
and educational topics that can lead to constructive change in our lives, our
nation and our world."

INVESTMENT ADVISORY AND OTHER SERVICES

We are advised by Citizens Advisers, Inc. under a contract known as the
Management Agreement. The Adviser's office is at 230 Commerce Way, Suite 300,
Portsmouth, New Hampshire 03801. The Adviser is a California corporation.
Citizens Securities, Inc., a wholly-owned subsidiary of the Adviser and a
California corporation, serves as Citizens Funds' distributor.

The Management Agreement provides that the Adviser, subject to the control
of our Board of Trustees, will decide which securities will be bought and sold,
and when, and requires the Adviser to place purchase and sale orders. At the
Adviser's discretion and sole expense, these duties may be delegated to a
sub-adviser.

SENECA CAPITAL MANAGEMENT, LLC
Our sub-adviser for the Citizens Income and Emerging Growth Funds is
Seneca Capital Management, LLC, a registered investment adviser which manages
over $6 billion from its offices at 909 Montgomery Street, San Francisco,
California. It is majority owned by Phoenix, Duff & Phelps Corporation
("Phoenix"), with a 74.9% ownership interest. Phoenix is a diversified
financial services organization engaged primarily in investment management of
institutional and individual accounts, with over $33 billion in assets under
management. Gail Seneca, who with her partners founded Seneca's predecessor
company, GMG/Seneca Capital Management, L.P. in 1990, continues, along with her
key staff members, to be the owners of the minority interests in Seneca. Ms.
Seneca and her key staff members entered into long term employment contracts
with Phoenix when it purchased Seneca in 1997. The day to day business and
affairs of Seneca, including its investment management activities, remain under
the control of Ms. Seneca and her staff.

CLEMENTE CAPITAL, INC.
Our sub-adviser for the Citizens Global Equity Fund, Clemente Capital,
Inc., is a registered investment adviser organized in 1979. It is majority
owned by Lilia Clemente with 61.15% ownership; Wilmington Trust of Wilmington,
Delaware with 24% and Diaz-Verson Capital Investments, Inc. of Columbus,
Georgia with 14.85%. Clemente also manages the First Philippine and Clemente
Global Growth Funds, two closed-end funds traded on the New York Stock
Exchange. Its headquarters are at Carnegie Hall Tower, 152 West 57th Street,
New York, New York.

The Adviser provides us, at the Adviser's expense, with all office space,
facilities and equipment and clerical personnel necessary to carry out its
duties under the Management Agreement. Some of our Trustees and our officers
are employees of our Adviser and receive their compensation from the Adviser.
Our custodian bank maintains, as part of its services for which we pay a fee,
many of the books and records that we are required to have and computes our net
asset value and dividends per share.

We pay the Adviser a fee for its services at a percentage of each fund's
average annual net assets as follows:

Working Assets Money Market Fund (Standard and Institutional Class
shares)--0.35%; Citizens Income Fund--65%; Citizens Emerging Growth
Fund--1.00%; Citizens Global Equity Fund--1.00%; and Citizens Index Fund
(Standard and Institutional Class shares)--0.50%. The fee is accrued daily and
payable monthly. The Adviser has agreed to limit our expenses each year. If
expenses exceed this limit, the Adviser will reduce its fee by, or refund, the
amount of the excess. The limit on our expenses, pursuant to the Management
Agreement, is as follows: Working Assets Money Market Fund: 1.50% of the first
$40 million or our average annual net assets and 1% thereafter; and Citizens
Income Fund: 1.75% of the first $100 million of average net assets and 1.25%

<PAGE>

thereafter. There is no limit on expenses for Citizens Emerging Growth Fund,
Citizens Global Equity Fund, Citizens Index Fund or Working Assets Money Market
Fund, Institutional Class shares.

Not all our expenses are subject to the limits described above. Interest
expenses, taxes, brokerage commissions, and extraordinary expenses, such as
litigation, that do not usually occur in the operations of a mutual fund are
not included.

For the fiscal years ended June 30, 1996, 1997 and 1998, the Adviser
received the following fees: Working Assets Money Market Fund, 1996-$423,731,
1997-$341,144 and 1998-$392,811; Citizens Income Fund, 1996-$207,386,
1997-$218,016 and 1998-$290,174; Citizens Emerging Growth Fund, 1996-$197,492,
1997-$503,188 and 1998-$741,296; Citizens Global Equity Fund, 1996-$118,662,
1997-$206,581 and 1998-$372,017; and Citizens Index Fund, 1996-$689,466,
1997-$878,074 and 1998-$1,439,749.

The Management Agreement provides that in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations thereunder, the Adviser is not liable for any loss sustained by the
purchase, sale or retention of any security and permits the Adviser to act as
investment adviser and/or principal underwriter for any other person, firm or
corporation. The Management Agreement provides that we will indemnify the
Adviser to the full extent permitted under the Declaration of Trust. The
Management Agreement also states that it is agreed that the Adviser shall have
no responsibility or liability for the accuracy or completeness of our
Registration Statement under the Securities Act of 1933 and the 1940 Act except
for information supplied by the Adviser for inclusion therein.

There are similar provisions with respect to the liability of the
sub-adviser, and the obligation of the Trust to indemnify the sub-adviser.

ADMINISTRATIVE AND SHAREHOLDER SERVICES AGREEMENT
Citizens Advisers also performs a wide variety of administrative duties
for Citizens Funds under a separate administrative and shareholder services
contract which provides for reimbursement of out of pocket expenses as well as
fees for services rendered. These fees and expenses are payable monthly and
include fees based on the annual rate of the average daily net assets in the
following amounts: Working Assets Money Market Fund (Standard shares) - 0.15%;
Citizens Income Fund, Emerging Growth Fund and Global Equity Fund - 0.10%;
Citizens Index Fund (Standard shares) - 0.20%; Citizens Index Fund,
Institutional Class shares - 0.30% (of which only 0.09% was charged for the
year ended June 30, 1998). The administrative services provided to Citizens
Funds include but are not limited to the following: daily fund accounting
duties including payment and budgeting of fund operating expenses and
calculation of expense accruals; administration of annual Trust audit with
Trust Auditors; supervision of drafting and printing of annual and semi annual
reports; administrative and contractual interface with Custodian and Transfer
Agent including daily monitoring of net asset value, sales, redemptions,
dividends and quality control; and compliance with federal and state regulation
requirements. Citizens Advisers is also reimbursed at cost for state Blue Sky
filing and reporting services; vendor relations; drafting and filing of
prospectuses, statements of additional information, proxies and other
regulatory filings; and special projects.
In addition, Citizens Securities provides a number of administrative
services to Citizens Funds relating primarily to shareholder services and
communications, and is reimbursed a flat fee approximating the "market price"
of such services. These include but are not limited to answering calls from
existing shareholders in a timely manner; maintenance of a toll-free number;
responding to shareholder inquiries and requests; maintenance of computer
interface with Transfer Agent; retention, maintenance and research of
shareholder records; maintenance of facilities and equipment to perform all
such duties; and similar services.
The Citizens Index Fund, Standard shares may also be charged a shareholder
service fee of up to 0.45% of average daily net assets.

<PAGE>

For the fiscal years ended June 30, 1996, 1997 and 1998, the Adviser
accrued the following administrative and shareholder service fees: Working
Assets Money Market Fund, 1996-$186,145, 1997-$293,217 and 1998-$278,850;
Citizens Income Fund, 1996-$74,254, 1997-$78,340 and 1998-$101,909; Citizens
Emerging Growth Fund, 1996-$117,910, 1997-$172,422 and 1998-$193,896; Citizens
Global Equity Fund, 1996-$68,745, 1997-$71,181 and 1998-$86,805; and Citizens
Index Fund1996-$903,081 1997-$1,104,684 and 1998-$1,635,911 .

DISTRIBUTION PLAN
Pursuant to a Distribution Agreement, Citizens Securities, Inc. (the
"Distributor"), a wholly owned subsidiary of the Adviser, acts as the
distributor of our shares. There is no sales charge imposed on any of the
funds, either when you purchase or redeem shares.

Broker-dealer and other organizations, known as Service Organizations,
which assist in the distribution of our shares may receive fees from us or our
Distributor. Our Board of Trustees has adopted a Distribution Plan under
Section 12(b) of the 1940 Act and Rule 12b-1 thereunder (the "Plan"). In
approving the Plan, the Trustees determined, in the exercise of their business
judgment and in light of their fiduciary duties, that there is a reasonable
likelihood that the Plan will benefit us and our shareholders. Pursuant to this
Plan, Service Organizations that enter into written agreements with us and our
Distributor may receive, for administration, shareholder service and
distribution assistance, fees at rates determined by our Trustees. In addition,
our Distributor is authorized to purchase advertising, sales literature and
other promotional material and to pay its own salespeople. We will reimburse
the Distributor for these expenditures and for fees paid to Service
Organizations, up to a limit of 0.25% on an annual basis of our average daily
net assets for the Income Fund, Emerging Growth Fund, Global Equity Fund and
Citizens Index Fund (Standard shares); and up to a limit of 0.20% for the
Working Assets Money Market Fund (Standard shares) and 0.07% for the Citizens
Index Fund, Institutional Class shares (although there was no reimbursement for
this class for the year ended June 30, 1998). There is no provision under our
Distribution Plan for reimbursing Citizens Securities for expenditures on
behalf of the Working Assets Money Market Fund, Institutional Class shares. In
addition, if and to the extent that the fee we pay our Distributor as well as
other payments we make are considered as indirectly financing any activity
which is primarily intended to result in the sale of our shares, such payments
are authorized under the Plan.

The Plan will continue in effect if such continuance is specifically
approved at least annually by our Trustees, including a majority of the
Trustees who are not "interested persons" (as defined in the 1940 Act) and who
have no financial interest in the operation of the Plan or in any agreement
related to the Plan. These Trustees are known as "Qualified Trustees."
Agreements related to the Plan must also be approved in the same manner by a
vote of the Trustees and the Qualified Trustees. These agreements will
terminate automatically if assigned, and may be terminated at any time, without
payment of any penalty, by a vote of the majority of the Qualified Trustees or
a vote of our outstanding voting securities on not more than 60 days notice.

Each fund is responsible for the cost of preparing and setting in type
prospectuses and reports to shareholders and distributing copies of the
prospectuses and reports to shareholders. The Distributor pays the cost of
printing and distributing all other copies of prospectuses and reports, as well
as the costs of supplemental sales literature and advertising. The Trust pays
all of our other expenses not expressly assumed by the Adviser such as
interest, taxes, audit and legal fees and expenses, charges of our custodian,
our shareholder servicing, transfer and record-keeping agent costs, insurance
premiums, stock issuance and redemption costs, certain printing costs, costs of
registering our shares under federal and state laws, and dues and assessments
of the Investment Company Institute, as well as any non-recurring expenses,
including litigation.

The Plan provides that the Distributor shall provide and the Trustees
shall review quarterly reports setting forth the amounts, payments and the
purpose for which the amounts were expended. The Plan further provides that
while it is in effect the selection and nomination of the Trustees who are not
interested persons shall be committed to the discretion of the Qualified

<PAGE>

Trustees. The Plan may not be amended to increase materially the amounts to be
spent without shareholder approval, as set forth above, and all amendments must
be approved by the Trustees, as described above. The Plan only permits
reimbursement of actual expenses and does not permit expenses to be carried
forward from one fiscal period to another. For the years ended June 30, the
following fees were approved and paid under this Plan, 1996-$683,515,
1997-$838,348 and 1998-$1,250,855. The major categories of expenses for 1998
were as follows: marketing, advertising and public relations, printing and
mailing prospectuses to other than current shareholders, compensation to
broker/dealers and compensation to sales personnel.

ADDITIONAL INFORMATION

Our Declaration of Trust permits our Trustees to issue an unlimited number
of full and fractional shares of beneficial interest and to divide or combine
the shares into a greater or lesser number of shares without thereby changing
the proportionate beneficial interests in Citizens Funds. Each share represents
an interest in the applicable fund of Citizens Funds. Certificates representing
our shares are not issued. In the event of our liquidation, all shareholders
would share pro rata in our net assets available for distribution to
shareholders. The Trustees also have the power to designate "series" of
Citizens Funds which will function as separate funds, each having its own
assets and liabilities. They may also create additional classes of shares which
may differ from each other as to dividends and expenses. Shares of each class
are entitled to vote as a class or series only to the extent required by the
1940 Act or as provided in our Declaration of Trust or as permitted by our
Trustees. Income and operating expenses are allocated fairly among the series
and classes by our Trustees. We intend to manage our funds in such a way as to
be a "diversified" investment company, as defined in the 1940 Act. As of June
30, 1998, there were 150,669,880 outstanding shares of beneficial interest,
representing all the shares of all five funds comprising Citizens Funds. The
following are the shareholders who owned beneficially or of record 5% or more
of the outstanding shares: Working Assets Money Market Fund (Standard shares) -
no holders of 5% or more. Working Assets Money Market Fund (Institutional Class
shares) - Bankers Trust of Cattee, (34 Exchange Place, 6th Fl., Jersey City, NJ
07302), 20.85%. Citizens Index Fund (Standard shares) - Charles Schwab & Co.,
Inc., (101 Montgomery St., San Francisco, CA 94104), 9.25%. Citizens Index Fund
(Institutional Class shares) - Regence Blueshield of Idaho, (1602 21st Ave,
Lewiston, ID 83501), 16.08%; Sophia Collier*, (230 Commerce Way, Ste. 300,
Portsmouth, NH 03801), 7.21%; and Gloria Steinem Trustee, (135 W. 50th St.,
16th Fl., New York, NY 10020), 6.932%. Citizens Income Fund - Charles Schwab &
Co., Inc., 9.66%. Citizens Emerging Growth Fund - Charles Schwab & Co, Inc.,
11.23%. Citizens Global Equity Fund - Charles Schwab & Co, Inc., 29.16%.
*Trustee

VOTING RIGHTS

Shareholders are entitled to one vote for each full share held (and
fractional votes for fractional shares) and may vote in the election of
Trustees and on other matters submitted to meetings of shareholders. Voting is
generally by class and series except as otherwise provided by the provisions of
the 1940 Act. The Trustees will call a meeting of shareholders to vote on the
removal of a Trustee upon the written request of the record holders of ten
percent of our shares. No amendment may be made to the Declaration of Trust
without the affirmative vote of the holders of more than 50% of our outstanding
shares. The holders of shares have no preemptive or conversion rights. Shares
when issued are fully paid and non assessable, except as set forth under
"Shareholder and Trustee Liability" below. Citizens Funds may be terminated
upon the sale of its assets to another issuer, if such sale is approved by the
vote of the holders or more than 50% of our outstanding shares, or upon
liquidation and distribution of our assets, if approved by the vote of the
holders of more than 50% of our outstanding shares. If not so terminated,
Citizens Funds will continue indefinitely.

SHAREHOLDER AND TRUSTEE LIABILITY

We are an entity of the type commonly known as a "Massachusetts business
trust." Under Massachusetts law, shareholders of such a trust may, under
certain circumstances, be held personally liable as partners for the

<PAGE>

obligations of the trust. Our Declaration of Trust contains an express
disclaimer of shareholder liability for our acts or obligations and requires
that notice of such disclaimer be given in each agreement, obligation or
instrument entered into or executed by us or our Trustees. The Declaration of
Trust provides for indemnification and reimbursement of expenses by the
relevant fund out of the fund's property for any shareholder held personally
liable for the fund's obligations. The Declaration of Trust also provides that
we shall, upon request, assume the defense of any claim made against any
shareholder for any act or obligation of ours and satisfy our judgment thereon.
Thus, the risk of a shareholder incurring financial loss on account of
shareholders liability is highly unlikely and is limited to the relatively
remote circumstances in which we would be unable to meet our obligations.

The Declaration of Trust further provides that the Trustees will not be
liable for errors of judgment or mistakes of fact or law, but nothing in the
Declaration of Trust protects a Trustee against any liability to which he or
she would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in the conduct
of his or her office.

CUSTODIAN

State Street Bank and Trust Company, One Heritage Drive, North Quincy,
Massachusetts, is the custodian of the assets of Citizens Funds. The custodian
takes no part in determining the investment policies of Citizens Funds or in
deciding which securities are purchased or sold by the Fund. We, however, may
invest in obligations of the custodian and may purchase or sell securities from
or to the custodian.

AUDITORS

The funds' Independent Accountants are PricewaterhouseCoopers LLP, One
Post Office Square, Boston, MA, 02109. PricewaterhouseCoopers LLP will conduct
an annual audit of the financial statements of the funds, will prepare the
funds' federal and state income tax returns and consult with management of the
funds as to matters of accounting, regulatory filings, and federal and state
income taxation.

The audited financial statements of the funds are incorporated here by
reference.

The statements of assets and liabilities, including the schedules of
investments, and the related statements of operations and of changes in net
assets and the financial highlights for the year ended June 30, 1998 have been
audited by PricewaterhouseCoopers LLP, as stated in their opinion which is
incorporated by reference and has been so incorporated in reliance of such
report given upon their authority as experts in accounting and auditing.

The statements of changes in net assets for the year ended June 30, 1997
and the financial highlights for the periods ended on or before June 30, 1997
have been audited by Tait Weller & Baker, as stated in their opinion which is
incorporated by reference and has been so incorporated in reliance of such
report given upon their authority as experts in accounting and auditing.

LEGAL COUNSEL

Bingham Dana LLP, 150 Federal Street, Boston, Massachusetts.

FINANCIAL STATEMENTS

The following financial statements of Citizens Funds and the opinion of
its independent auditors, included in the Annual Report to the shareholders for

<PAGE>

the year ended June 30, 1998 are incorporated herein by reference and are
provided to each person to whom the Statement of Additional Information is sent
or given:

Statement of Investments - June 30, 1998
Statement of Assets and Liabilities - June 30,1998
Statement of Operations for the year ended - June 30, 1998
Statement of Changes in Net Assets for the years ended June 30, 1997 and 1998.
Financial Highlights for the years ended June 30, 1994, 1995, 1996, 1997 and
1998.
Notes to Financial Statements
Report of Independent Certified Public Accountants

<PAGE>

APPENDIX A: DESCRiPTION OF RATINGS

DESCRIPTION OF BOND RATINGS
We use the ratings provided by national rating services as one of several
indicators of the investment quality of fixed income securities. The following
is a description of the ratings of the three services we use most frequently.
When considering any rating, it is important to remember that the ratings of
Moody's, Standard & Poor's and Fitch IBCA represent their opinions as to the
quality of various debt instruments. It should be emphasized, however, that
ratings are not absolute standards of quality. Consequently, debt instruments
with the same maturity, coupon and rating may have different yields while debt
instruments with the same maturity and coupon with different ratings may have
the same yield.

MOODY'S

AAA: Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edged." 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.
Together with the Aaa group they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risk appear somewhat larger than in Aaa
securities.

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 some time 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.

BA: Bonds which are rated Ba are judged to have 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 of 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.

C: Bonds which are rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.

<PAGE>

RATING REFINEMENTS: Moody's applies numerical modifiers, 1, 2 and 3 in each
generic rating classification from Aa through Caa. The modifier 1 indicates
that the obligation ranks in the higher end of its generic rating category; the
modifier 2 indicates a mid-range ranking; and modifier 3 indicates a ranking in
the lower end of that generic rating category.

STANDARD & POOR'S LONG-TeRM ISSUE CREDIT RATINGS

AAA: An obligation rated AAA has the highest rating assigned by Standard &
Poor's. The obligor's capacity to meet its financial commitment on the
obligation is extremely strong.

AA: An obligation rated AA differs from the highest rated obligations only in
small degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.

A: An obligation rated A is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

BBB: An obligation rated BBB exhibits adequate protection parameters. However,
adverse economic conditions or changing circumstances are more likely to lead
to a weakened capacity of the obligor to meet its financial commitment on the
obligation.

BB, B, CCC, CC AND C: Obligations rated BB, B, CCC, CC and C are regarded as
having significant speculative characteristics. BB indicates the least degree
of speculation and C the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.

BB: An obligation rated BB is less vulnerable to nonpayment than other
speculative issues. However, it faces major ongoing uncertainties or exposure
to adverse business, financial, or economic conditions which could lead to the
obligor's inadequate capacity to meet its financial commitment on the
obligation.

B: An obligation rated B is more vulnerable to nonpayment than obligations
rated BB, but the obligor currently has the capacity to meet its financial
commitment on the obligation. Adverse business, financial or economic
conditions will likely impair the obligor's capacity or willingness to meet its
financial commitment on the obligation.

CCC: An obligation rated CCC is currently vulnerable to nonpayment, and is
dependent upon favorable business, financial and economic conditions for the
obligor to meet its financial commitment on the obligation. In the event of
adverse business, financial, or economic conditions, the obligor is not likely
to have the capacity to meet its financial commitment on the obligation.

CC: An obligation rated CC is currently highly vulnerable to nonpayment.

C: The rating C may be used to cover a situation where a bankruptcy petition
has been filed or similar action has been taken, but payments on this
obligation are being continued.

D: An obligation rated D is in payment default. The D rating category is used
when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes that
such payments will be made during such grace period. The D rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action
if payments on an obligation are jeopardized.

PLUS (+) OR MINUS (-): The ratings from AA to CCC may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.

<PAGE>

R: This symbol is attached to the ratings of instruments with significant
noncredit risks. It highlights risks to principal or volatility of expected
returns which are not addressed in the credit rating. Examples include:
obligations linked or indexed to equities, currencies, or commodities;
obligations exposed to severe prepayment risk--such as interest-only or
principal-only mortgage securities; and obligations with unusually risky
interest terms, such as inverse floaters.

FITCH IBCA INTERNATIONAL LONG-TERM CREDIT RATINGS

AAA: Highest credit quality. "AAA" ratings denote the lowest expectation of
credit risk. They are assigned only in the case of exceptionally strong
capacity for timely payment of financial commitments. This capacity is highly
unlikely to be adversely affected by foreseeable events.

AA: Very high credit quality. "AA" ratings denote a very low expectation of
credit risk. They indicate very strong capacity for timely payment of financial
commitments. The capacity is not significantly vulnerable to foreseeable
events.

A: High credit quality. "A" ratings denote a low expectation of credit risk.
The capacity for timely payment of financial commitments is considered strong.
This capacity may, nevertheless, be more vulnerable to changes in circumstances
or in economic conditions than is the case for higher ratings.

BBB: Good credit quality. "BBB" ratings indicate that there is currently a low
expectation of credit risk. The capacity for timely payment of financial
commitments is considered adequate, but adverse changes in circumstances and in
economic conditions are more likely to impair this capacity. This is the lowest
investment-grade category.

PLUS (+) OR MINUS (-): Plus and minus signs may be appended to a rating to
denote relative status within the major rating categories. Such suffixes are
not added to the "AAA" long-term rating category.

MOODY'S SHORT-TERM Prime Rating SysteM--TAXABLE DEBT & DEPOSITS GLOBALLY

Moody's short-term debt ratings are opinions of the ability of issuers to repay
punctually senior debt obligations. The obligations have an original maturity
not exceeding one year, unless explicitly noted.

Moody's employs the following three designations, all judged to be investment
grade, to indicate the relative repayment ability of rated issuers:

PRIME-1: Issuers rated Prime-1 (or supporting institutions) have a superior
ability for repayment of senior short-term debt obligations. Prime-1 repayment
ability will often be evidenced by many of the following characteristics:

o Leading market positions in well-established industries.
o High rates of return on funds employed.
o Conservative capitalization structure with moderate reliance on debt
and ample asset protection.
o Broad margins in earnings coverage of fixed financial charges and
high internal cash generation.
o Well-established access to a range of financial markets and assured
sources of alternate liquidity.

PRIME-2: Issuers rated Prime-2 (or supporting institutions) have a strong
ability for repayment of senior short-term debt obligations. This will normally
be evidenced by many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, may be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.

PRIME-3: Issuers rated Prime-3 (or supporting institutions) have an acceptable
ability for repayment of senior short-term obligations. The effect of industry

<PAGE>

characteristics and market compositions may be more pronounced. Variability in
earnings and profitability may result in changes in the level of debt
protections measurements and may require relatively high financial leverage.
Adequate alternate liquidity is maintained.

NOT PRIME: Issuers rated Not Prime do not fall within any of the Prime rating
categories.

NOTE: Moody's ratings are opinions, not recommendations to buy or sell, and
their accuracy is not guaranteed. A rating should be weighed solely as one
factor in an investment decision and you should make your own study and
evaluation of any issuers whose securities or debt obligations you consider
buying or selling.

STANDARD & POOR'S SHORT-TERM ISSUE CREDIT RATINGS

Standard & Poor's short-term issue credit ratings are a current assessment of
the likelihood of timely payment of debt having an original maturity of no more
than 365 days. Ratings are graded as follows:

A-1: A short-term obligation rated A-1 is rated in the highest category by
Standard & Poor's. The obligor's capacity to meet its financial commitment on
the obligation is strong. Within this category, certain obligations are
designated with a plus sign (+). This indicates that the obligor's capacity to
meet its financial commitment on these obligations is extremely strong.

A-2: A short-term obligation rated A-2 is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than
obligations in higher rating categories. However, the obligor's capacity to
meet its financial commitment on the obligation is satisfactory.

A-3: A short-term obligation rated A-3 exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely
to lead to a weakened capacity of the obligor to meet its financial commitment
on the obligation.

B: A short-term obligation rated B is regarded as having significant
speculative characteristics. The obligor currently has the capacity to meet its
financial commitment on the obligation; however, it faces major ongoing
uncertainties which could lead to the obligor's inadequate capacity to meet its
financial commitment on the obligation.

C: A short-term obligation rated C is currently vulnerable to nonpayment and is
dependent upon favorable business, financial and economic conditions for the
obligor to meet its financial commitment on the obligation.

D: A short-term obligation rated D is in payment default. The D rating category
is used when payments on an obligation are not made on the date due even if the
applicable grace period had not expired, unless Standard & Poor's believes that
such payments will be made during such grace period. The D rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action
if payments on an obligation are jeopardized.

<PAGE>
PART C: OTHER INFORMATION

Item 24 (a) Financial Statements
Statement of Investments - June 30, 1998
Statement of Assets and Liabilities - June 30,1998
Statement of Operations for the year ended - June 30, 1998
Statement of Changes in Net Assets for the years ended June 30, 1997
and 1998.
Financial Highlights for the years ended June 30, 1994, 1995, 1996,
1997 and 1998.
Notes to Financial Statements
Report of Independent Certified Public Accountants

The above Financial Statements were filed with the Securities and
Exchange Commission, Accession number 0000950146-98-001479 on
September 1, 1998.

(b) Exhibits

(1) Declaration of Trust******
(2) By-Laws*
(5) Management Agreement
a Management Agreement******
b Renewal of Management Agreement******
c Form of Sub-Investment Advisory Agreement**
d Amended Sub-Investment Advisory Agreement*****
(6) Distribution Agreement:
a Distribution Agreement, as amended******
b Renewal of Distribution Agreement******
c Amendment to Distribution Agreement dated May 6, 1996**
d Amendment to Distribution Agreement dated May 30, 1996**
(8) Custodian Agreement***
(9) Other Material Contracts:
a Administrative Agreement as amended******
b Amendment to Administrative Agreement**
(10) Opinion and Consent of Counsel as to the legality of the
securities being registered****
(11) Accountants' consents
(15) Rule 12b-1 Distribution Plan******
(25) Powers of Attorney*****
(27) Financial Data Schedule

* Incorporated by reference to Post-Effective Amendment No. 38 to the
Registrant's Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on June 21, 1996.

<PAGE>

** Incorporated by reference to Post-Effective Amendment No. 34 to the
Registrant's Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on June 21, 1996.

*** Incorporated by reference to Post-Effective Amendment No. 35 to the
Registrant 's Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on September 27, 1996.

**** Incorporated by reference to the Registrant's Registration Statement
on N-14 (File No. 2-80886), as filed with the Securities and Exchange
Commission on September 5, 1997.

***** Incorporated by reference to Post-Effective Amendment No. 40 to the
Registrant's Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on December 11, 1997.

******* Incorporated by reference to Post-Effective Amendment No. 42 to
the Registrant's Registration Statement (File No. 2-80886), as filed
with the Securities and Exchange Commission on August 28, 1998.

Item 25. Persons Controlled by or under Common Control with Registrant

o See the Prospectus and the Statement of Additional Information
regarding the Registrant's control relationships.
o Citizens Funds is a Massachusetts business trust.
o Citizens Advisers, Inc., the investment adviser to the Registrant,
is a California corporation, which also controls the distributor
of the Registrant, Citizens Securities, which is also a California
corporation.

Item 26. Number of Holders of Securities

Number of Record Holders
Title of Class as of August 26, 1998
- -------------------------------------------------------------------------------
Working Assets Money Market Fund 13,428
- -------------------------------------------------------------------------------
Working Assets Money Market Fund -
Institutional Class 121
- -------------------------------------------------------------------------------
Citizens Income Fund 4,323
- -------------------------------------------------------------------------------
Citizens Index Fund 20,168
- -------------------------------------------------------------------------------
Citizens Index Fund - Institutional Class 106
- -------------------------------------------------------------------------------
Citizens Emerging Growth Fund 9,988
- -------------------------------------------------------------------------------
Citizens Global Equity Fund 4,355
- -------------------------------------------------------------------------------
<PAGE>

Item 27. Indemnification

Article Seventh of the Declaration of Trust filed as Exhibit 1 to the
Registration Statement is incorporated by reference. Citizens Funds
participates in a group liability policy under which it and its
trustees, officers and affiliated persons, the adviser and the
distributor are insured against certain liabilities.

Item 28. Business and other Connections of Investment Adviser

Other businesses, professions, vocations, or employment of a
substantial nature in which each director or principal officer of
Citizens Advisers, Inc. is or has been, at any time during the last
two fiscal years, engaged for his or her own account or in the
capacity of director, officer, employee, partner or trustee are as
follows:

<S> <C>
Name and Position Connection with and
With Investment Adviser Name of Other Company Adviser

John L. Shields, Trustee, Citizens Funds
President

Sophia Collier, Trustee, Citizens Funds
Partner Chair of Board, Citizens Advisers
President, Northpoint Technology, LTD
President, NPT, Inc.

John P. Dunfey, Chairman and Director, Dunfey Brothers Capital Group
Partner President, Treasruer & Director DA-TRIAD, Inc.
Trustee and Governor, Dana-Farber Cancer Inst., Boston
Chair, Human Rights Project, Inc.
Chair, New England Circle, Inc.
Director, International League for Human Rights, NY

Robert J. Dunfey, Sr. Treasurer & Founding Director, Dunfey Brothers
Partner Capital Group
Trustee, the Jackson Laboratory, Bar Harbor, Maine
Past Director, KeyBank of Maine
Trustee, University of Maine System
Treasurer and Director, New England Circle, Inc.
Director, American Ireland Fund, Boston
Founder & Honorary Director, Susan L. Curtis
Foundation, Portland, Maine

<PAGE>

Gerald Dunfey, Vice President & Founding Director, Dunfey Brothers
Partner Capital Group
Director, DA-TRIAD, Inc.
President, New England Circle, Inc.
Director, Martin Luther King Center for Nonviolent
Social Change
Board of Advisors, Fund for a Free South Africa
Board of Incorporators, Joslin Diabetes Center

William Hart, Director, SIS Bank, Springfield, MA
Partner Director, Blue Cross/Blue Shield of NH
President, Dunfey Brothers Capital Group
Director, DA-TRIAD, Inc.
Director, National Trust for Historic Preservation
Director, American Academy in Rome
Director, Currier Gallery of Art
Director, Berwick Academy, Berwick, Maine

</TABLE>

Item 29. Principal Underwriters

(a) Not applicable.

(b) The following are directors and officers of Citizens Funds'
distributor, Citizens Securities: John L. Shields, President,
230 Commerce Way, Suite 300, Portsmouth, NH. Ms. Collier is also
an interested trustee of the Registrant and Chair of the
investment adviser or management company, Citizens Advisers,
Inc.
(c) Not applicable.

Item 30. Location of Accounts and Records

The accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940, as amended, and
the rules under that act are kept at Citizens Funds' Transfer and
Dividend Distributing Agent, PFPC, Inc., 400 Bellevue Pkwy.,
Wilmington, DE 19808, and at Citizens Funds' Custodian and Fund
Accounting Agent, State Street Bank and Trust, One Heritage Drive,
North Quincy, MA 02171.

Item 31. Management Services

Not applicable.

Item 32. Undertakings

(a) Not applicable.

<PAGE>

(b) The Registrant hereby undertakes to call a meeting of
shareholders for the purpose of voting upon the question of removal
of one or more of the Registrant's trustees when requested in writing
to do so by the holders of at least 10% of the Registrant's
outstanding shares, and in connection therewith to comply with the
provisions of Section 16(c) of the Investment Company Act of 1940
relating to shareholder communications.

(c) The Registrant undertakes to furnish to each person to whom a
prospectus of Citizens Funds is delivered with a copy of its latest
Annual Report to Shareholders, upon request without charge.

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act and the Investment Company
Act, the Registrant certifies that it meets all the requirements for
effectiveness of this Post-Effective Amendment to this registration statement
pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Portsmouth and State of New Hampshire
on the 23rd day of October, 1998.

CITIZENS FUNDS

By /s/ Joseph F. Keefe
--------------------------
Joseph F. Keefe, Secretary

Sophia Collier*
- ----------------------------- Trustee, President,
(Sophia Collier) Principal Executive,
Financial and
Accounting Officer

Azie Taylor Morton*
- ----------------------------- Trustee
(Azie Taylor Morton)

William Glenn*
- ----------------------------- Trustee
(William Glenn)

Ada Sanchez*
- ----------------------------- Trustee
(Ada Sanchez)

J.D. Nelson*
- ----------------------------- Trustee
(J.D. Nelson)

Juliana Eades*
- ----------------------------- Trustee
(Juliana Eades)

Lokelani Devone*
- ----------------------------- Trustee
(Lokelani Devone )

<PAGE>

Robert B. Reich*
- ----------------------------- Trustee
(Robert B. Reich)

Mitchell Johnson*
- ----------------------------- Trustee
(Mitchell Johnson)

* By Joseph F. Keefe Attorney in Fact /s/ Joseph F. Keefe
-------------------------

See Powers of Attorney dated December 1, 1997, filed with the commission on
December 11, 1997.

<PAGE>

EXHIBIT INDEX

(1) Declaration of Trust******
(2) By-Laws*
(5) Management Agreement
(a) Management Agreement******
(b) Renewal of Management Agreement******
(c) Form of Sub-Investment Advisory Agreement**
(d) Amended Sub-Investment Advisory Agreement*****
(6) Distribution Agreement:
(a) Distribution Agreement, as amended******
(b) Renewal of Distribution Agreement******
(c) Amendment to Distribution Agreement dated May 6, 1996**
(d) Amendment to Distribution Agreement dated May 30, 1996**
(8) Custodian Agreement***
(9) Other Material Contracts:
(a) Administrative Agreement as amended******
(b) Amendment to Administrative Agreement**
(10) Opinion and Consent of Counsel as to the legality of the securities
being registered****
(11) Accountants' consents
(15) Rule 12b-1 Distribution Plan******
(25) Powers of Attorney*****
(27) Financial Data Schedule

* Incorporated by reference to Post-Effective Amendment No. 38 to the
Registrants Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on June 21, 1996.

** Incorporated by reference to Post-Effective Amendment No. 34 to the
Registrant's Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on June 21, 1996.

*** Incorporated by reference to Post-Effective Amendment No. 35 to the
Registrant's Registration Statement (File No. 2-80886), as filed with
the Securities and Exchange Commission on September 27, 1996.

**** Incorporated by reference to the Registrant's Registration Statement
on N-14 (File No. 2-80886), as filed with the Securities and Exchange
Commission on September 5, 1997.

<PAGE>

EXHIBIT 11

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

We have issued our report dated July 25, 1997, accompanying the
financial statements and financial highlights of Working Assets Money Market
Fund, Citizens Income Fund, Citizens Index Fund, Citizens Emerging Growth Fund,
and Citizens Global Equity Fund, each a series of shares of beneficial interest
of Citizens Trust, originally appearing in the Annual Report to Shareholders
for the year ended June 30, 1997. We consent to the aforementioned report and
to the references to our Firm under the Post-Effective Amendment to the
Registration Statement on Form N-1A and related Prospectus.

Tait, Weller & Baker

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
October 26, 1998

<PAGE>

CONSENT OF INDEPENDENT ACCOUNTANTS

To the Board of Trustees of Citizens Funds

RE: Working Assets Money Market Fund
Citizens Income Fund
Citizens Index Fund
Citizens Emerging Growth Fund
Citizens Global Equity Fund

We hereby consent to the incorporation by reference of our report dated
August 14, 1998 on our audit of the financial statements and financial
highlights of the above referenced funds as of June 30, 1998 in the Statement
of Additional Information with respect to the Post-Effective Amendment to the
Registration Statement on Form N-1A under the Securities Act of 1933, as
amended, of Citizens Trust. We further consent to the reference to our Firm
under the caption "Auditors" in the Statement of Additional Information.

PricewaterhouseCoopers LLP

PRICEWATERHOUSECOOPERS LLP

<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> WORKING ASSETS MONEY MARKET FUND (STANDARD SHARES)

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 119,059,553
<INVESTMENTS-AT-VALUE> 119,059,553
<RECEIVABLES> 1,351,269
<ASSETS-OTHER> 1,808,120
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 122,218,942
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 443,357
<TOTAL-LIABILITIES> 443,357
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 121,775,585
<SHARES-COMMON-STOCK> 103,720,315
<SHARES-COMMON-PRIOR> 85,179,413
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 121,775,585
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 6,366,757
<OTHER-INCOME> 0
<EXPENSES-NET> 1,242,032
<NET-INVESTMENT-INCOME> 5,124,725
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 5,124,725
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,124,725)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 225,185,324
<NUMBER-OF-SHARES-REDEEMED> 231,203,065
<SHARES-REINVESTED> 4,133,681
<NET-CHANGE-IN-ASSETS> 19,092,288
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 392,811
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,257,904
<AVERAGE-NET-ASSETS> 94,446,434
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.045
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0.045
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 1.21
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> WORKING ASSETS MONEY MARKET FUND (INSTITUTIONAL CLASS SHARES)

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 119,059,553
<INVESTMENTS-AT-VALUE> 119,059,553
<RECEIVABLES> 1,351,269
<ASSETS-OTHER> 1,808,120
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 122,218,942
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 443,357
<TOTAL-LIABILITIES> 443,357
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 121,775,585
<SHARES-COMMON-STOCK> 18,178,492
<SHARES-COMMON-PRIOR> 17,503,884
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 121,775,585
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 6,366,757
<OTHER-INCOME> 0
<EXPENSES-NET> 1,242,032
<NET-INVESTMENT-INCOME> 5,124,725
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 5,124,725
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,124,725)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 12,205,583
<NUMBER-OF-SHARES-REDEEMED> 12,423,765
<SHARES-REINVESTED> 892,790
<NET-CHANGE-IN-ASSETS> 19,092,288
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 392,811
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,257,904
<AVERAGE-NET-ASSETS> 17,793,961
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.051
<PER-SHARE-GAIN-APPREC> 0.000
<PER-SHARE-DIVIDEND> 0.051
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.56
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 3
<NAME> CITIZENS INCOME FUND

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 50,684,903
<INVESTMENTS-AT-VALUE> 52,822,122
<RECEIVABLES> 1,092,744
<ASSETS-OTHER> 21,276
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 53,936,142
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,570,533
<TOTAL-LIABILITIES> 2,570,533
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 49,453,609
<SHARES-COMMON-STOCK> 4,657,040
<SHARES-COMMON-PRIOR> 3,148,474
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 51,365,609
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,256,720
<OTHER-INCOME> 0
<EXPENSES-NET> 778,601
<NET-INVESTMENT-INCOME> 2,478,119
<REALIZED-GAINS-CURRENT> 1,898,887
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 4,377,006
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,459,515)
<DISTRIBUTIONS-OF-GAINS> (74,371)
<DISTRIBUTIONS-OTHER> (7,360)
<NUMBER-OF-SHARES-SOLD> 1,362,024
<NUMBER-OF-SHARES-REDEEMED> 1,047,393
<SHARES-REINVESTED> 197,805
<NET-CHANGE-IN-ASSETS> 18,135,439
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 290,174
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 831,240
<AVERAGE-NET-ASSETS> 44,642,452
<PER-SHARE-NAV-BEGIN> 10.56
<PER-SHARE-NII> 0.60
<PER-SHARE-GAIN-APPREC> 0.49
<PER-SHARE-DIVIDEND> 0.60
<PER-SHARE-DISTRIBUTIONS> 0.02
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 1.74
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 4
<NAME> CITIZENS INDEX FUND (STANDARD SHARES)

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 215,523,989
<INVESTMENTS-AT-VALUE> 373,203,398
<RECEIVABLES> 5,095,786
<ASSETS-OTHER> 34,674
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 378,333,858
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,265,058
<TOTAL-LIABILITIES> 5,265,058
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 213,103,487
<SHARES-COMMON-STOCK> 14,555,329
<SHARES-COMMON-PRIOR> 11,700,040
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 373,068,800
<DIVIDEND-INCOME> 3,291,529
<INTEREST-INCOME> 91,183
<OTHER-INCOME> 0
<EXPENSES-NET> 4,431,419
<NET-INVESTMENT-INCOME> (1,048,707)
<REALIZED-GAINS-CURRENT> 90,803,143
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 89,754,436
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (113,426)
<DISTRIBUTIONS-OF-GAINS> (12,990,583)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,470,158
<NUMBER-OF-SHARES-REDEEMED> 2,229,198
<SHARES-REINVESTED> 614,329
<NET-CHANGE-IN-ASSETS> 148,952,167
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,439,749
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,433,815
<AVERAGE-NET-ASSETS> 268,820,862
<PER-SHARE-NAV-BEGIN> 18.04
<PER-SHARE-NII> (0.07)
<PER-SHARE-GAIN-APPREC> 6.44
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 0.95
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 23.46
<EXPENSE-RATIO> 1.59
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 5
<NAME> CITIZENS INDEX FUND (INSTITUTIONAL CLASS SHARES)

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 215,523,989
<INVESTMENTS-AT-VALUE> 373,203,398
<RECEIVABLES> 5,095,786
<ASSETS-OTHER> 34,674
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 378,333,858
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,265,058
<TOTAL-LIABILITIES> 5,265,058
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 213,103,487
<SHARES-COMMON-STOCK> 1,656,079
<SHARES-COMMON-PRIOR> 876,298
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 373,068,800
<DIVIDEND-INCOME> 3,291,529
<INTEREST-INCOME> 91,183
<OTHER-INCOME> 0
<EXPENSES-NET> 4,431,419
<NET-INVESTMENT-INCOME> (1,048,707)
<REALIZED-GAINS-CURRENT> 90,803,143
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 89,754,436
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (113,426)
<DISTRIBUTIONS-OF-GAINS> (12,990,583)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 856,256
<NUMBER-OF-SHARES-REDEEMED> 143,279
<SHARES-REINVESTED> 66,804
<NET-CHANGE-IN-ASSETS> 148,952,167
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,439,749
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 4,433,815
<AVERAGE-NET-ASSETS> 19,129,232
<PER-SHARE-NAV-BEGIN> 14.84
<PER-SHARE-NII> 0.110
<PER-SHARE-GAIN-APPREC> 5.210
<PER-SHARE-DIVIDEND> 0.080
<PER-SHARE-DISTRIBUTIONS> 0.95
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 19.13
<EXPENSE-RATIO> 0.88
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 6
<NAME> CITIZENS EMERGING GROWTH FUND

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 64,254,574
<INVESTMENTS-AT-VALUE> 85,315,078
<RECEIVABLES> 4,881,928
<ASSETS-OTHER> 2,640
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 90,199,646
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,308,088
<TOTAL-LIABILITIES> 2,308,088
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 66,245,930
<SHARES-COMMON-STOCK> 5,008,373
<SHARES-COMMON-PRIOR> 4,268,721
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 87,891,558
<DIVIDEND-INCOME> 192,416
<INTEREST-INCOME> 243,916
<OTHER-INCOME> 0
<EXPENSES-NET> 1,455,374
<NET-INVESTMENT-INCOME> (1,019,042)
<REALIZED-GAINS-CURRENT> 22,402,410
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 21,383,368
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 8,679,595
<NUMBER-OF-SHARES-REDEEMED> 8,255,328
<SHARES-REINVESTED> 315,387
<NET-CHANGE-IN-ASSETS> 27,550,627
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 741,296
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,455,374
<AVERAGE-NET-ASSETS> 74,129,563
<PER-SHARE-NAV-BEGIN> 14.14
<PER-SHARE-NII> (0.20)
<PER-SHARE-GAIN-APPREC> 4.61
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 1.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 17.55
<EXPENSE-RATIO> 1.96
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 7
<NAME> CITIZENS GLOBAL EQUITY FUND

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 31,074,117
<INVESTMENTS-AT-VALUE> 48,581,556
<RECEIVABLES> 499,882
<ASSETS-OTHER> 49,325
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 49,130,763
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 85,433
<TOTAL-LIABILITIES> 85,433
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 35,580,293
<SHARES-COMMON-STOCK> 2,894,252
<SHARES-COMMON-PRIOR> 2,044,409
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 49,045,330
<DIVIDEND-INCOME> 344,500
<INTEREST-INCOME> 187,703
<OTHER-INCOME> 0
<EXPENSES-NET> 816,710
<NET-INVESTMENT-INCOME> (284,507)
<REALIZED-GAINS-CURRENT> 8,009,642
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 7,725,135
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,279,900
<NUMBER-OF-SHARES-REDEEMED> 513,508
<SHARES-REINVESTED> 83,450
<NET-CHANGE-IN-ASSETS> 19,472,374
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 372,017
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 816,710
<AVERAGE-NET-ASSETS> 37,199,267
<PER-SHARE-NAV-BEGIN> 14.47
<PER-SHARE-NII> (0.20)
<PER-SHARE-GAIN-APPREC> 3.24
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 0.56
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 16.95
<EXPENSE-RATIO> 2.20
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00

</TABLE>