INDEPENDENT AUDITORS' REPORT
To the Board of Trustees and Shareholders of HighMark Funds:
In planning and performing our audits of the financial
Statements of HighMark Funds (the "Funds"), including
Growth Fund,Value Momentum Fund, Income Equity Fund,
Core Equity Fund, Balanced Fund, Small Cap Value Fund,
International Equity Fund, California Intermediate
Tax-Free Bond Fund, Bond Fund, Intermediate-Term Bond
Fund, 100% U.S. Treasury Money Market Fund, U.S.
Government Money Market Fund, Diversified Money Market
Fund and California Tax-Free Money Market Fund for the
periods ended July 31, 2000 (on which we have issued our
report dated September 11, 2000), we considered their
internal control structure, including controls over
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, and not to provide
assurance on the Funds' 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 any internal
control, misstatements due to error or fraud may occur
and not be detected. Also, projections of any evaluation
of internal control to future periods are subject to
the risk that the internal control may become inadequate
because of changes in conditions or that the degree of
compliance with policies or procedures may deteriorate.
Our consideration of the Funds' internal control would
not necessarily disclose all matters in the 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 the Funds' internal control and its operation,
including controls for safeguarding securities, that we
consider to be material weaknesses as defined above as
of July 31, 2000.
This report is intended solely for the information and
use of management, the Board of Trustees and the
Securities and Exchange Commission and is not intended
to be and should not be used by anyone other than
these specified parties.
DELOITTE & TOUCHE LLP
San Francisco, California
September 11, 2000
