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SECURITIES AND EXCHANGE COMMISSION --------------------------
WASHINGTON, D.C. 20549 OMB Approval
FORM N-17f-2 --------------------------
OMB Number: 3235-0360
Certificate of Accounting of Securities and Similar Expires: July 31, 1994
Investment in the Custody of Estimated average burden
Management Investment Companies hours per response... 0.05
Pursuant to Rule 17f-2 [17 CFR 270.17f-2]
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1. Investment Company Act File Number: Date examination completed
811-4416 July 31, 1999
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2. State identification Number: N/A
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AL AK AZ AR CA CO
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CT DE DC FL GA HI
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ID IL IN IA KS KY
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LA ME MD MA MI MN
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MS MO MT NE NV NH
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NJ NM NY NC ND OH
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OK OR PA RI SC SD
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TN TX UT VT VA WA
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WV WI WY PUERTO RICO
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Other (specify):
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3. Exact name of investment company as specified in representation statement:
Parkstone Funds
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4. Address of principal executive office (number, street, city, state, zip code):
One Freedom Valley Drive, Oaks, PA 19456
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INSTRUCTIONS
This Form must be completed by investment companies that have custody of
securities or similar investments
INVESTMENT COMPANY
1. All items must be completed by the investment company.
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2. Give this Form to the independent public accountant who, in compliance with
Rule 17f-2 under the Act and applicable state law, examines securities and
similar investments in the custody of the investment company.
ACCOUNTANT
3. Submit this Form to the securities and Exchange Commission and appropriate
state securities administrators when filing the certificate of accounting
required by Rule 17f-2 under the Act and applicable state law. File the
original and one copy with the Securities and Exchange Commission's
principal office in Washington, D.C., one copy with the regional office for
the region in which the investment company's principal business operations
are conducted, and one copy with the appropriate state administrator(s), if
applicable.
THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT
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September 30, 1999
Ernst & Young LLP
1300 Huntington Building
925 Euclid Avenue
Cleveland, Ohio 44115
Management Statement Regarding Compliance with
Certain Provisions of the Investment Company Act of 1940
We, as members of management of National City Bank ("the Company"), are
responsible for complying with the requirements of subsection (b) and (c) of
Rule 17f-2, "Custody of Investments by Registered Management Investment
Companies," of the Investment Company Act of 1940. We are also responsible for
establishing and maintaining effective controls over compliance with those
requirements. We have performed an evaluation of the Company's compliance with
the requirements of subsection (b) and (c) of Rule 17f-2 as of July 31, 1999.
Based on this evaluation, we assert that the Company was in compliance with the
requirements of subsection (b) and (c) of Rule 17f-2 of the Investment Company
Act of 1940 as of July 31, 1999 with respect to securities and similar
investments reflected in the investment account of the Company.
Very truly yours,
/s/ Brian R. Loveless
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Brian R. Loveless
Senior Vice President
/s/ Robert A. Arnold
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Robert A. Arnold
Senior Vice President
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Independent Accountant's Report
To the Board of Directors of
Parkstone Funds
We have examined management's assertion about the Parkstone Funds' ("the Funds")
compliance with the requirements of subsection (b) and (c) of Rule 17f-2 of the
Investment Company Act of 1940 ("the Act") as of July 31, 1999 included in
the accompanying Management Statement Regarding Compliance with Certain
Provisions of the Investment Company Act of 1940, as amended. Management is
responsible for the Funds' compliance with those requirements. Our
responsibility is to express an opinion on management's assertion about the
Funds' compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and accordingly, included
examining, on a test basis, evidence about the Funds' compliance with those
requirements and performing such other procedures as we considered necessary in
the circumstances. Included among our procedures were the following tests
performed as of July 31, 1999, and with respect to agreement of security
and similar investments purchases and sales, for the period from July 1, 1999
through July 31, 1999;
[ ] Count and inspection of all securities and similar investments located
in the vault of National City Bank ("the Custodian") without prior
notice to management;
[ ] Confirmed or performed alternate procedures on all of the Custodian's
securities and similar investments held by Chase Bank the
Depository Trust Company, the Federal Reserve Bank of Cleveland,
Union Bank of California, Goldman Sachs & Co., Federated Investors,
and Provident Institutional Services. Ascertained that the securities
of the Funds were included in the total holdings of such securities
per the Custodian's records;
[ ] Confirmation of all securities and similar investments hypothecated,
pledged, placed in escrow, or out for transfer with brokers, pledgees
and/or transfer agents;
[ ] Reconciliation of confirmation results as to all such securities and
investments to the books and records of the Funds and the Custodian;
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[ ] Confirmed or performed alternate procedures on all repurchase
agreements with brokers/banks and agreement of underlying collateral
with the Custodian's records; and
[ ] Agreement of a total of five security and/or investment purchases and
security and/or investment sales or maturities, since our last
examination, from the books and records of the Funds to broker
confirmations.
We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Funds' compliance with
specified requirements.
In our opinion, management's assertion that the Funds were in compliance with
the requirements of subsection (b) and (c) of Rule 17f-2 of the Investment
Company Act of 1940, as amended, as of July 31, 1999 with respect to securities
and similar investments reflected in the investment account of the Funds is
fairly stated, in all material respects.
This report is intended solely for the information and use of management of the
Funds and the Securities and Exchange Commission and is not intended to be and
should not be used by anyone other than these specified parties.
Ernst & Young LLP
Cleveland, Ohio
September 30, 1999
