PRINCIPAL PRESERVATION PORTFOLIOS, INC.
CASH RESERVE PORTFOLIO
Class Y Common Stock (Institutional Class)
Supplement dated October 25, 1996
to Prospectus dated January 2, 1996
At a meeting held on October 25, 1996, the Board of Directors of Principal
Preservation Portfolios, Inc. ("Principal Preservation") selected Arthur
Andersen LLP as independent public accountants for the Cash Reserve Portfolio
(the "Portfolio") to audit the Portfolio's financial statements for the fiscal
year ending December 31, 1996. The Board of Directors of Principal Preservation
believes that the selection of Arthur Andersen as independent accountants for
the Portfolio should result in cost savings and other related efficiencies
because Arthur Andersen currently serves as independent accountants for all
other portfolios of Principal Preservation.
The selection of Arthur Andersen was made following the voluntary
resignation of Price Waterhouse LLP as independent public accountants for the
Portfolio. Price Waterhouse resigned for reasons relating exclusively to fees.
There were no disagreements between Principal Preservation and Price Waterhouse
over any accounting matters.
