Report of Independent Accountants
To the Board of Directors and Shareholders
of Eastcliff Funds, Inc.
In planning and performing our audit of the financial statements of
Eastcliff Total Return Fund, Eastcliff Growth Fund, Eastcliff Emerging
Growth Fund, Eastcliff Regional Small Capitalization Value Fund and
Eastcliff Contrarian Value Fund (constituting Eastcliff Funds, Inc.,
hereafter referred to as the "Funds") for the period ended June 30, 2000,
we considered their 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, not to provide
assurance on internal control.
The management of the Funds 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 internal control, errors or fraud may
occur and not be detected. Also, projection of any evaluation of
internal control to future periods is subject to the risk that controls
may become inadequate because of changes in conditions or that the
effectiveness of their design and operation may deteriorate.
Our consideration of 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 misstatements caused
by error 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 internal control and its operation, including controls for
safeguarding securities, that we consider to be material weaknesses as
defined above as of June 30, 2000.
This report is intended solely for the information and use of the Board
of Directors, management and the Securities and Exchange
Commission and is not intended to be and should not be used by
anyone other than these specified parties.
July 28, 2000
