Filing pursuant to Rule 497
1933 Act File. No. 33-10754
1940 Act File No. 811-4933
Commonwealth Cash Reserve Fund, Inc.
Supplement to Statement of Additional Information
dated August 1, 1998
Certificates of Deposit - The Fund is authorized to invest in negotiable
certificates of deposit and negotiable bank deposit notes of domestic
banks and domestic offices of foreign banks with a rating of at least A-1
by Standard & Poor's and P-1 by Moody's Investor Services, Inc., for
maturities of one year or less, and a rating of at least AA by Standard
and Poor's and Aa by Moody's Investor Service, Inc., for maturities
over one year and not exceeding thirteen months.
Municipal Obligations - The Fund may invest in the stocks, bonds, notes and
other evidences of indebtedness of municipal entities including any state
of the United States or any city, county, town or district situated in any
one of the states of the United States upon which there is no default. See
"Investment Policies" in the Additional Statement for a discussion of
additional criteria that municipal obligations must meet to be eligible for
investment by the Fund.
Additional Requirements for Municipal Obligations - The Fund may only purchase
municipal obligations that are legal investments for govermental units in
Virginia under Section 2.1-328 of the Code of Virginia, as it may be amended
from time to time. The following municipal obligations are permitted
investments for the Fund.
Obligations of the Commonwealth - Stocks, bonds, notes and other evidences of
indebtedness of the Commonwealth of Virginia, and those unconditionally
guaranteed as to the payment of principal and interest by the Commonwealth of
Virginia.
Obligations of Other States - Stocks, bonds, notes and other evidences of
indebtedness of any state of the United States upon which there is no
default and upon which there has been no default for more than ninety days;
provided, that within the twenty fiscal years next preceding the making of such
investment, such state has not been in default for more than ninety days in
the payment of any part of principal or interest of any debt authorized by
the legislature of such state to be contracted.
Obligations of Virginia Governmental Units - Stocks, bonds, notes and other
evidences of indebtedness of any county, city, town, district, authority or
other public body in the Commonwealth of Virginia upon which there is no
default; provided, that if the principal and interest be payable from revenues
or tolls and the project has not been completed, or if completed, has not
established an operating record of net earnings available for payment of
principal and interest equal to estimated requirements for that purpose
according to the terms of the issue, the Fund will invest in such instruments
only when PFM is satisfied that the credit risk with respect to the issuer
is minimal.
