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Prudential Institutional Liquidity Portfolio, Inc.
(Institutional Money Market Series)
Supplement dated June 2, 1997 to
Prospectus dated May 30, 1996
The following information supplements the sections listed below:
Fund Expenses and How the Fund is Managed--Manager
Effective June 2, 1997, Total Fund Operating Expenses will decrease to .20
of 1% for shares of the Series on an annualized basis. Prudential Investments
Fund Management LLC (the Manager) has agreed to waive .05 of 1% of its
management fee in order to reduce such fee to .15% of 1% and to subsidize
ordinary expenses and Prudential Securities Incorporated has agreed to waive .07
of 1% of its distribution/services fee in order to reduce such fee to .05 of 1%.
Annual series operating expenses for the Series are set forth under 'Fund
Expenses' in the Prospectus. The Manager may make further modifications in the
future.
How the Fund Values its Shares
The Series' net asset value per share or NAV is determined by subtracting
its liabilities from the value of its assets and dividing the remainder by the
number of outstanding shares. The Board of Directors has fixed the specific time
of day for the computation of the NAV to be as of 4:00 p.m., New York time, on
each day the Fund is open for business.
Taxes, Dividends and Distributions
Dividends declared are accrued throughout the month and are distributed in
the form of full and fractional shares on or about the 23rd day of the month,
effective July 1, 1997, unless the shareholder elects in writing, not less than
five business days prior to the dividend distribution date, to receive such
distributions in cash.
The calculation of net investment income for dividend purposes is made
immediately prior to the calculation of net asset value at 4:00 p.m., New York
time. In the case of a purchase order that becomes effective prior to 4:00 p.m.,
New York time (the funds are received by wire that day), a shareholder begins to
earn dividends declared on that day.
The Fund will not accept purchase and redemption orders after 4:00 p.m. If a
redemption request is received prior to 4:00 p.m., New York time, the
shareholder does not earn a dividend on that day but the redemption proceeds are
wired on that day.
Net income earned on Saturdays, Sundays and holidays is accrued in
calculating the dividend on the previous business day. Accordingly, an investor
who places a purchase order prior to 4:00 p.m., New York time, on a Friday
begins earning dividends that day. A shareholder which redeems its shares prior
to 4:00 p.m., New York time, on a Friday does not earn a dividend which reflects
the income earned by the Series on the Friday, or the following Saturday and
Sunday.
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Shareholder Guide--How to Buy Shares of the Fund
If a purchase order is telephoned to Prudential Mutual Fund Services LLC
(PMFS) (toll-free) (800-521-7466) before 4:00 p.m., New York time, and federal
funds are received by the Custodian on that business day, the purchase order
becomes effective as of 4:00 p.m., New York time, and the shares are entitled to
dividend income earned on that day. See 'Taxes, Dividends and Distributions.'
All account transactions by telephone through PMFS will be recorded.
Shareholder Guide--How to Sell Your Shares
In order for shares to be redeemed and withdrawal proceeds to be wired on
the same day as the request is made, telephone instructions or the written
redemption request must be received prior to 4:00 p.m., New York time. Any
request received prior to 4:00 p.m., New York time, will be wired the same day.
However, due to federal wire restrictions and individual bank hours of
operation, the proceeds may not be available to the client until the following
business day. Shares redeemed prior to 4:00 p.m., New York time, are not
entitled to the dividend declared on the day of redemption. See 'Taxes,
Dividends and Distributions.'
MF137C-3 (6/2/97)
