o149*P
SUPPLEMENT DATED OCTOBER 1, 1998
TO THE PROSPECTUS OF
FRANKLIN CASH RESERVES FUND
DATED NOVEMBER 1, 1997, AS AMENDED FEBRUARY 1, 1998
The prospectus is amended as follows:
I. The third paragraph under the chart in the section "How Do I Sell Shares?"
is replaced in its entirety with the following:
The wiring of redemption proceeds is a special service that we make available
whenever possible. Generally, if we
receive your request in proper form before 3:00 p.m. Pacific time, your wire
payment will be sent the next business day. For requests received in proper
form after 3:00 p.m. Pacific time, the payment will be sent the second
business day.
For non-retirement plan participants, payment may be transmitted by wire the
same business day, if the phone request is received before 11:15 a.m. Pacific
time that day. For later requests, payment will be transmitted by wire the
next business day. If you anticipate requesting a same-day wire redemption
over $5 million, please notify the Fund about this on the prior business day.
In order to maximize efficient Fund management, please request your same-day
wire redemption of any size as early in the day as possible. Prior business
day notification of the trade may be required.
By offering this service to you, the Fund is not bound to meet any redemption
request in less than the seven-day period prescribed by law. Neither the Fund
nor its agents shall be liable to you or any other person if, for any reason,
a redemption request by wire is not processed as described in this section.
II. The first paragraph under "What Distributions Might I Receive from the
Fund?" is revised to read as follows:
The Fund declares dividends each day that its Net Asset Value is calculated
and pays them monthly. The daily allocation of net investment income begins
on the day after you make an investment and continues through the day you
redeem your shares or the settlement of a wire order trade.
III. The following definition is revised in the "Useful Terms and
Definitions" section:
CONTINGENCY PERIOD - The 12 month period during which a Contingent Deferred
Sales Charge may apply. The holding period begins on the day you buy your
shares. For example, if you buy shares on the 18th of the month, they will
age one month on the 18th day of the next month and each following month.
Please keep this supplement for future reference.
