<PAGE>
GOLDMAN SACHS TRUST
GOLDMAN SACHS MONEY MARKET FUNDS
GOLDMAN SACHS EQUITY FUNDS
GOLDMAN SACHS FIXED INCOME FUNDS
ILA, ILA CLASS B, ILA CLASS C, ILA ADMINISTRATION, ILA SERVICE,
FST, FST PREFERRED, FST SERVICE, FST ADMINISTRATION,
SERVICE, ADMINISTRATION AND INSTITUTIONAL SHARES
----------------
SUPPLEMENT DATED DECEMBER 2, 1997 TO THE FOLLOWING PROSPECTUSES:
GOLDMAN SACHS MONEY MARKET FUNDS
(Financial Square Funds) dated September 5, 1997
(Institutional Liquid Assets)
ILA, ILA Administration and ILA Service Shares dated May 1, 1997
ILA Class B and ILA Class C Shares dated August 15, 1997
GOLDMAN SACHS FIXED INCOME FUNDS
Administration Shares dated May 1, 1997
Service and Institutional Shares dated August 15, 1997
GOLDMAN SACHS EQUITY FUNDS
Service and Institutional Shares dated October 1, 1997
When an investment adviser, broker, bank, trust company or other depository or
financial institution ("Service Organization") invests in Shares of a Fund on
behalf of its customers, normally, purchase, exchange and redemption orders
will not be effective until received by Goldman Sachs as described in the
Prospectus. Goldman Sachs Trust (the "Trust") may, however, authorize certain
Service Organizations and/or transfer agents that provide recordkeeping,
reporting and processing services to their customers to accept on the Trust's
behalf orders placed by or on behalf of such customers and, if approved by the
Trust, to designate other intermediaries to accept such orders. In these
cases, a Fund will be deemed to have received an order in proper form by or on
behalf of a customer when the order is accepted by the authorized Service
Organization or intermediary on a Business Day (as defined in the Prospectus),
and the order will be priced at a Fund's net asset value per share next
determined after such acceptance. The Service Organization or intermediary
will be responsible for transmitting accepted orders to the Trust within the
period agreed upon by them. A customer should contact its Service Organization
to learn whether it is authorized to accept orders for the Trust. The Service
Organizations may receive payments from the Funds or Goldman Sachs for the
services provided by them with respect to each of the Funds' respective share
classes. These payments may be in addition to other servicing and/or sub-
transfer agency payments borne by the Funds and their share classes.
In the case of each Goldman Sachs Equity Fund and Goldman Sachs Fixed Income
Fund, other than the Adjustable Rate Government, Short Duration Government,
Short Duration Tax-Free and Core Fixed Income Funds, the minimum initial
investment in Institutional Shares of a particular Fund for (a) individual
investors; (b) qualified non-profit organizations, charitable trusts,
foundations and endowments; and (c) accounts over which GSAM or its advisory
affiliates have investment discretion is $10 million. The minimum investment
requirement may be waived at the discretion of the Trust's officers. No
minimum amount is required for subsequent investments.
Under the section "Purchase of Institutional Shares"--"Minimum Initial
Investments" for the Goldman Sachs Fixed Income Funds and "Purchase
Procedures" for the Goldman Sachs Equity Funds, items (c) and (h) of the
second paragraph are deleted.
<PAGE>
Effective December 1, 1997, the Investment Adviser's voluntary cap on certain
other expenses of the High Yield Fund will be changed and as a result, to the
extent certain other expenses (excluding management, service, and transfer
agency fees, taxes, interest and brokerage fees, and litigation,
indemnification, and other extraordinary expenses) exceed 0.14% of the average
daily net assets of the Fund, the Investment Adviser will reduce or limit such
expenses.
The Table under "Fees and Expenses" regarding Annual Fund Operating Expenses
for the Institutional and Service Shares of the High Yield Fund is amended as
follows:
<TABLE>
<CAPTION>
HIGH YIELD FUND/1/
---------------------
ANNUAL FUND OPERATING EXPENSES INSTITUTIONAL SERVICE
(AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS) SHARES SHARES
--------------------------------------------- ------------- -------
<S> <C> <C>
Management Fees (after applicable limitations)/2/......... 0.65% 0.65%
Distribution (Rule 12b-1) Fees............................ none none
Service Fees/3/........................................... none 0.50%
Other Expenses (after applicable limitations)/4/.......... 0.18% 0.18%
---- ----
TOTAL FUND OPERATING EXPENSES
(after fee and expense limitations)/5/................... 0.83% 1.33%
==== ====
</TABLE>
EXAMPLE
You would pay the following expenses on a hypothetical $1,000 investment
assuming (i) a 5% annual return and (ii) redemption at the end of each time
period.
<TABLE>
<CAPTION>
FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ---- ------ ------- ------- --------
<S> <C> <C> <C> <C>
High Yield
Institutional Shares.......................... $ 8 $26 N/A N/A
Service Shares................................ $14 $42 N/A N/A
</TABLE>
- --------
/1/ Based on estimated amounts for the current fiscal year.
/2/ The Investment Adviser has voluntarily agreed that a portion of the
management fee equal to .05% of the Fund's average daily net assets would not
be imposed on the High Yield Fund. Without such limitations, the management
fee would be .70% of the Fund's average daily net assets.
/3/ Service Organizations may charge other fees to their customers who are
beneficial owners of Service Shares in connection with their customer
accounts.
/4/ The Investment Adviser has voluntarily agreed to reduce or limit certain
other expenses of the High Yield Fund (excluding management, service, and
transfer agency fees, taxes, interest and brokerage fees, and litigation,
indemnification, and other extraordinary expenses) to the extent such
expenses exceed 0.14% of the average daily net assets of the Fund.
/5/ Without the limitations described above, "Other Expenses" and "Total
Operating Expenses" of the Institutional and Service Shares of the High Yield
Fund for the current fiscal year are estimated to be:
<TABLE>
<CAPTION>
INSTITUTIONAL SERVICE
SHARES SHARES
------------- -------
<S> <C> <C>
Other Expenses.................. .60% .60%
Total Operating Expenses........ 1.30% 1.80%
</TABLE>
GSSTK 12/97
