The Rushmore Fund, Inc.
4922 Fairmont Avenue
Bethesda, Maryland 20814
To the Board of Directors of The Rushmore Fund, Inc.:
We are the auditors of The Rushmore Fund, Inc. (the
Fund), a series investment company comprised of one
portfolio, the U.S. Government Bond Portfolio (the
Portfolio). Rushmore Trust and Savings, FSB (Rushmore
Trust), a related entity, is custodian of the Fund's
portfolio and the Fund is therefore subject to the
provisions of Rule 17f-2 under the Investment Company
Act of 1940. Accordingly, we have, without prior
notice to the Fund or to Rushmore Trust, accounted
for the Portfolios' investment securities held by
Rushmore Trust as of the close of business on June
29, 1998. It is understood that this report is
solely for the use of management and for the
information of the Securities and Exchange
Commission and should not be used for any other
purpose.
Rushmore Trust, in addition to acting as custodian
for the Portfolio, is custodian for other customers.
Agents of Rushmore Trust hold, or account for by
book entry, securities that are the responsibility
of Rushmore Trust through custodial or trust
agreements. Securities held by agents of Rushmore
Trust, while identified by such agents as being
deposited by Rushmore Trust, cannot be identified
by such agents as to the specific customers of
Rushmore Trust who have securities included in such
deposits.
Rushmore Trust confirmed to us that the portfolio
securities owned by the Fund on June 29, 1998 were
held for the account of Rushmore Trust by the Federal
Reserve Book Entry System (the Fed), as agent for
Rushmore Trust. We obtained confirmation from the
Fed of the securities held for the account of the
Rushmore Trust as of June 29, 1998. We reviewed
Rushmore Trust's reconciliation of the Fed's
confirmation to Rushmore Trust's internal records,
identifying securities held by the Fed as a part of
Rushmore Trust's aggregate security position with the
Fed. We also reviewed Rushmore Trust's records that
show the owners of the securities held by the Fed for
the account of the Rushmore Trust at June 29, 1998.
We determined that these securities, identified by
such records as the property of the Fund's Portfolio,
were in agreement with the Fund's records of
securities owned at June 29, 1998. We also agreed an
analysis of portfolio transactions recorded subsequent
to December 19, 1997, the date of our most recent
examination of the Fund's securities required under
Rule 17f-2, in the investment accounts to supporting
records and verified a sample of portfolio security
transactions to supporting records and documentation.
Because the above procedures were not sufficient to
constitute an audit conducted in accordance with
generally accepted auditing standards, we do not
express an opinion on the investment accounts referred
to above as of the dates indicated. In connection
with the procedures referred to above, no matters
came to our attention that caused us to believe that
the specified accounts should be adjusted. Had we
performed additional procedures or had we conducted
an audit of the financial statements of the Fund in
accordance with generally accepted auditing standards,
matters might have come to our attention that would
have been reported to you. This report relates only
to the investments specified above and does not extend
to the financial statements of the Fund, taken as a
whole for any date or period.
Deloitte & Touche LLP
Princeton, New Jersey
August 7, 1998
