Independent Auditors' Report
To the Board of Trustees and Shareholders of
The Dreyfus/Laurel Funds, Inc.:
In planning and performing our audits of the financial
statements of The Dreyfus/Laurel Funds, Inc. (comprised of
Dreyfus Premier Large Company Stock Fund, Dreyfus
Disciplined Small Cap Stock Fund, Dreyfus Premier Small Cap
Value Fund, Dreyfus Premier Tax Managed Growth Fund, Dreyfus
U.S. Treasury Reserves, Premier Limited Term Income Fund,
Premier Small Company Stock Fund, Premier Balanced Fund,
Dreyfus Institutional Prime Money Market, Dreyfus
Disciplined Intermediate Bond Fund, Dreyfus Bond Market
Index Fund, Dreyfus Money Market Reserves, Dreyfus Municipal
Reserves, Dreyfus Premier Midcap Stock Fund, Dreyfus
Institutional U.S. Treasury Money Market Fund, Dreyfus BASIC
S&P 500 Stock Index Fund, Dreyfus Disciplined Stock Fund,
Dreyfus Institutional Government Money Market), (the
"Funds") for the year ended October 31, 2000, we considered
its internal control, 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 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 accounting standards generally
accepted in the United States of America. Those controls
include the safeguarding of assets against unauthorized
acquisition, use, or disposition.
Because of inherent limitations in internal control, error
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 it may become inadequate because of
changes in conditions or that the effectiveness of the
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 procedures for
safeguarding securities, that we consider to be material
weaknesses as defined above as of October 31, 2000.
This report is intended solely for the information and use
of management, the Board of Directors of The Dreyfus/Laurel
Funds and the Securities and Exchange Commission.
KPMG LLP
New York, New York
December 8 , 2000
