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SIGNATURE JULIE F. WILLIAMS
TITLE SECRETARY
INDEPENDENT AUDITORS' REPORT
The U.S. Government Securities Fund, Inc.:
In planning and performing our audit of the financial
statements of U.S. Government Securities Fund, Inc., (the
AFund@) for the year ended August 31, 1998 (on which we have
issued our report dated September 30, 1998), we considered
its internal control, including control activities for
safeguarding securities, in order to determine our auditing
procedures for the purpose of expressing our opinion on the
financial statements and to comply with the requirements of
Form N-SAR, and not to provide assurance on the Fund's
internal control.
The management of the Fund is responsible for establishing
and maintaining internal control. In fulfilling this
responsibility, estimates and judgments by management are
required to assess the expected benefits and related costs
of controls. Generally, controls that are relevant to an
audit pertain to the entity's objective of preparing
financial statements for external purposes that are fairly
presented in conformity with generally accepted accounting
principles. Those controls include the safeguarding of
assets against unauthorized acquisition, use, or
disposition.
Because of inherent limitations in any internal control,
errors or fraud may occur and may not be detected. Also,
projection of any evaluation of internal control to future
periods is subject to the risk that it may become inadequate
because of changes in conditions or that the effectiveness
of the design and operation may deteriorate.
Our consideration of the Fund's internal control would not
necessarily disclose all matters in internal control that
might be material weaknesses under standards established by
the American Institute of Certified Public Accountants. A
material weakness is a condition in which the design or
operation of one or more of the internal control components
does not reduce to a relatively low level the risk that
errors or fraud in amounts that would be material in
relation to the financial statements being audited may occur
and not be detected within a timely period by employees in
the normal course of performing their assigned functions.
However, we noted no matters involving the Fund's internal
control and its operation, including controls for
safeguarding securities, that we consider to be material
weaknesses as defined above as of August 31, 1998.
This report is intended solely for the information and use
of management, the Board of Directors of U.S. Government
Securities Fund, Inc., and the Securities and Exchange
Commission.
DELOITTE & TOUCHE LLP
Los Angeles, California
September 30, 1998
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