KEMPER INCOME FUNDS KEMPER INCOME FUNDS
Kemper High Yield Fund Kemper Adjustable Rate
Kemper High Yield U.S. Government Fund*
Opportunity Fund Kemper Short-Intermediate
Kemper Income And Capital Government Fund
Preservation Fund Kemper Diversified Income
Kemper Short-Term U.S. Fund**
Government Fund Kemper U.S. Government
Kemper Strategic Income Fund Securities Fund
Kemper U.S. Government Kemper High Yield Fund
Securities Fund Kemper High Yield
Kemper U.S. Mortgage Fund Opportunity Fund
SUPPLEMENT TO PROSPECTUS Kemper Income And Capital
DATED JANUARY 1, 1999, Preservation Fund
AS REVISED FEBRUARY 8, 1999 Kemper U.S. Mortgage Fund
------------------ SUPPLEMENT TO PROSPECTUS
DATED JANUARY 1, 1999
KEMPER TAX-FREE INCOME FUNDS ------------------
Kemper Municipal Bond Fund KEMPER INCOME FUNDS
Kemper Intermediate
Municipal Bond Fund Kemper High Yield Fund II
Kemper California Tax-Free SUPPLEMENT TO PROSPECTUS
Income Fund DATED NOVEMBER 30, 1998
Kemper Florida Tax-Free ------------------
Income Fund
Kemper New York Tax-Free
Income Fund
Kemper Ohio Tax-Free Income
Fund
SUPPLEMENT TO PROSPECTUS
DATED JANUARY 1, 1999
------------------
* On February 5, 1999, Kemper Short-Intermediate Government Fund was
reorganized into Kemper Adjustable Rate U.S. Government Fund. Kemper
Adjustable Rate U.S. Government Fund was then renamed Kemper Short-Term
U.S. Government Fund, and its objective and policies were changed
accordingly.
** Currently known as Kemper Strategic Income Fund
The following disclosure supplements the disclosure in the "Special Features --
Exchange Privilege -- General" section of the prospectus for all funds:
Effective June 1, 1999, in addition to the current limits on exchanges of shares
with a value over $1,000,000, shares of a Kemper Fund with a value of $1,000,000
or less (except Kemper Cash Reserves Fund) acquired by exchange from another
Kemper Fund, or from a Money Market Fund, may
March 29, 1999
<PAGE>
not be exchanged thereafter until they have been owned for 15 days if, in the
investment manager's judgement, the exchange activity may have an adverse effect
on the fund. In particular, a pattern of exchanges that coincides with a "market
timing" strategy may be disruptive to the Fund and therefore may be subject to
the 15-Day Hold Policy.
For Kemper Income And Capital Preservation Fund, the following disclosure
replaces the relevant paragraph in the "Principal strategies and investments"
section on page 36 of the prospectus dated January 1, 1999:
While the fund has the ability to invest up to 20% of its assets in high yield
securities, the fund normally invests predominantly in corporate debt securities
which are rated in the four highest grades by a nationally recognized
statistical rating service such as Standard and Poor's Corporation or Moody's
Investors Service, Inc. and Mortgage Backed Securities.
For Kemper Income And Capital Preservation Fund, the following disclosure
supplements the "Additional information about principal risks" section on page
36 of the prospectus dated January 1, 1999:
High Yield Fixed Income Securities. Investments in high yield fixed-income
securities (often referred to as "junk bonds") are more likely to be affected by
negative developments relating to their issuer or industry, and entail
relatively greater risk of loss of income and principal than investments in
higher rated securities. Market prices of high yield securities may fluctuate
more than market prices of higher rated securities.
