<PAGE> PAGE 1
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000 F000000 Y
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000 J000000 A
001 A000000 KEYSTONE AMERICA GOVERNMENT SECURITIES
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002 B000000 BOSTON
002 C000000 MA
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008 B000001 A
008 C000001 801-8327
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008 D020001 MA
008 D030001 02116
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010 A000001 EVERGREEN KEYSTONE INVESTMENT SERVICES
010 B000001 8-395
010 C010001 BOSTON
010 C020001 MA
010 C030001 02116
010 C040001 5034
011 A000001 EVERGREEN KEYSTONE DISTRIBUTOR
011 B000001 8-395
011 C010001 BOSTON
011 C020001 MA
011 C030001 02116
<PAGE> PAGE 2
011 C040001 5034
012 A000001 EVERGREEN KEYSTONE SERVICE COMPANY
012 B000001 84-1571
012 C010001 BOSTON
012 C020001 MA
012 C030001 02116
012 C040001 5034
013 A000001 KPMG PEAT MARWICK, LLP
013 B010001 BOSTON
013 B020001 MA
013 B030001 02110
013 B040001 2371
015 A000001 STATE STREET BANK & TRUST COMPANY
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022 A000001 PAINE WEBBER INC.
022 B000001 13-2638166
022 C000001 7677
022 D000001 16010
022 A000002 BANK OF NEW YORK/ITC DEALERS CLEARANCE
022 B000002 13-5160382
022 C000002 10568
022 D000002 3191
022 A000003 FUJI GOVERNMENT SECURITIES, INC.
022 B000003 36-3327521
022 C000003 8759
022 D000003 3398
022 A000004 BEAR STEARNS & CO., INC.
022 B000004 13-3299429
022 C000004 7109
022 D000004 4398
022 A000005 HOENIG & CO., LTD.
022 B000005 13-2656060
<PAGE> PAGE 3
022 C000005 2375
022 D000005 6555
022 A000006 DONALDSON, LUFKIN & JENRETTE SECURITIES CORP.
022 B000006 13-2741729
022 C000006 5855
022 D000006 1758
022 A000007 AUTRANET INC.
022 B000007 13-2961507
022 C000007 0
022 D000007 3093
022 A000008 ADAMS HARKNESS & HILL, INC.
022 B000008 04-2149932
022 C000008 1765
022 D000008 0
022 A000009 CS FIRST BOSTON CORPORATION
022 B000009 13-5659485
022 C000009 977
022 D000009 0
022 A000010 LEHMAN BROTHERS, INC.
022 C000010 352
022 D000010 0
023 C000000 326415
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SIGNATURE J. KEVIN KENELY
TITLE V.P. FUND ADMIN.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 101
<NAME> KEYSTONE GOVERNMENT SECURITIES FUND CLASS A
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-START> AUG-01-1996
<PERIOD-END> JUL-31-1997
<INVESTMENTS-AT-COST> 40,463,875
<INVESTMENTS-AT-VALUE> 41,240,715
<RECEIVABLES> 646,690
<ASSETS-OTHER> 14,600
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 41,902,005
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 56,636
<TOTAL-LIABILITIES> 56,636
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 22,628,014
<SHARES-COMMON-STOCK> 2,198,461
<SHARES-COMMON-PRIOR> 2,624,480
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (2,206,692)
<ACCUM-APPREC-OR-DEPREC> 1,151,544
<NET-ASSETS> 21,572,866
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,697,877
<OTHER-INCOME> 0
<EXPENSES-NET> (263,353)
<NET-INVESTMENT-INCOME> 1,434,524
<REALIZED-GAINS-CURRENT> 46,587
<APPREC-INCREASE-CURRENT> 848,443
<NET-CHANGE-FROM-OPS> 2,329,554
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,373,422)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 100,074
<NUMBER-OF-SHARES-REDEEMED> (623,179)
<SHARES-REINVESTED> 97,086
<NET-CHANGE-IN-ASSETS> (3,102,574)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (75,227)
<OVERDIST-NET-GAINS-PRIOR> (2,284,586)
<GROSS-ADVISORY-FEES> (148,554)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (263,352)
<AVERAGE-NET-ASSETS> 22,942,076
<PER-SHARE-NAV-BEGIN> 9.41
<PER-SHARE-NII> 0.59
<PER-SHARE-GAIN-APPREC> 0.37
<PER-SHARE-DIVIDEND> (0.57)
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 9.80
<EXPENSE-RATIO> 1.16
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 102
<NAME> KEYSTONE GOVERNMENT SECURITIES FUND CLASS B
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-START> AUG-01-1996
<PERIOD-END> JUL-31-1997
<INVESTMENTS-AT-COST> 40,463,875
<INVESTMENTS-AT-VALUE> 41,240,715
<RECEIVABLES> 646,690
<ASSETS-OTHER> 14,600
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 41,902,005
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 56,636
<TOTAL-LIABILITIES> 56,636
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 15,386,962
<SHARES-COMMON-STOCK> 1,480,005
<SHARES-COMMON-PRIOR> 1,881,535
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (947,781)
<ACCUM-APPREC-OR-DEPREC> 48,591
<NET-ASSETS> 14,487,772
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,193,787
<OTHER-INCOME> 0
<EXPENSES-NET> (306,383)
<NET-INVESTMENT-INCOME> 887,404
<REALIZED-GAINS-CURRENT> 26,186
<APPREC-INCREASE-CURRENT> 571,082
<NET-CHANGE-FROM-OPS> 1,484,672
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (846,668)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 277,247
<NUMBER-OF-SHARES-REDEEMED> (727,881)
<SHARES-REINVESTED> 49,104
<NET-CHANGE-IN-ASSETS> (3,190,589)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (17,104)
<OVERDIST-NET-GAINS-PRIOR> (973,671)
<GROSS-ADVISORY-FEES> (104,493)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (306,384)
<AVERAGE-NET-ASSETS> 16,146,007
<PER-SHARE-NAV-BEGIN> 9.40
<PER-SHARE-NII> 0.53
<PER-SHARE-GAIN-APPREC> 0.37
<PER-SHARE-DIVIDEND> (0.50)
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 9.80
<EXPENSE-RATIO> 1.91
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 103
<NAME> KEYSTONE GOVERNMENT SECURITIES FUND CLASS C
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-START> AUG-01-1996
<PERIOD-END> JUL-31-1997
<INVESTMENTS-AT-COST> 40,463,875
<INVESTMENTS-AT-VALUE> 41,240,715
<RECEIVABLES> 646,690
<ASSETS-OTHER> 14,600
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 41,902,005
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 56,636
<TOTAL-LIABILITIES> 56,636
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7,491,217
<SHARES-COMMON-STOCK> 590,684
<SHARES-COMMON-PRIOR> 880,989
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> (1,283,191)
<ACCUM-APPREC-OR-DEPREC> (423,295)
<NET-ASSETS> 5,784,731
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 520,555
<OTHER-INCOME> 0
<EXPENSES-NET> (133,668)
<NET-INVESTMENT-INCOME> 386,887
<REALIZED-GAINS-CURRENT> 5,867
<APPREC-INCREASE-CURRENT> 228,171
<NET-CHANGE-FROM-OPS> 620,925
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (370,961)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 51,375
<NUMBER-OF-SHARES-REDEEMED> (365,975)
<SHARES-REINVESTED> 24,295
<NET-CHANGE-IN-ASSETS> (2,533,620)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (2,432)
<OVERDIST-NET-GAINS-PRIOR> (1,296,115)
<GROSS-ADVISORY-FEES> (45,567)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (133,668)
<AVERAGE-NET-ASSETS> 7,044,678
<PER-SHARE-NAV-BEGIN> 9.41
<PER-SHARE-NII> 0.53
<PER-SHARE-GAIN-APPREC> 0.37
<PER-SHARE-DIVIDEND> (0.50)
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 9.81
<EXPENSE-RATIO> 1.91
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
The Trustees and Shareholders
Keystone Government Securities Fund
In planning and performing our audit of the financial statements of Keystone
Government Securities Fund for the year ended July 31, 1997, we considered its
internal control structure, including procedures 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 the internal control structure.
The management of Keystone Government Securities Fund is responsible for
establishing and maintaining an internal control structure. In fulfilling this
responsibility, estimates and judgments by management are required to assess the
expected benefits and related costs of internal control structure policies and
procedures. Two of the objectives of an internal control structure are to
provide management with reasonable, but not absolute, assurance that assets are
safeguarded against loss from unauthorized use or disposition and that
transactions are executed in accordance with management's authorization and
recorded properly to permit preparation of financial statements in conformity
with generally accepted accounting principles.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projection of any evaluation
of the structure to future periods is subject to the risks 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 internal control structure would not necessarily
disclose all matters in the internal control structure 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 the specific internal control structure elements does not reduce to
a relatively low level the risk that errors or irregularities 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 internal control structure, including procedures for safeguarding
securities, that we consider to be material weaknesses as defined above as of
July 31, 1997.
This report is intended solely for the information and use of management and the
Securities and Exchange Commission.
September 5, 1997
