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<PAGE> PAGE 2
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015 A000001 INVESTORS FIDUCIARY TRUST COMPANY
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020 B000002 13-3082694
020 C000002 95
020 A000003 MERRILL LYNCH, PIERCE, FENNER & SMITH INC.
<PAGE> PAGE 3
020 B000003 13-5674085
020 C000003 80
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022 C000002 163485
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022 D000003 46703
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022 C000004 54085
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<PAGE> PAGE 4
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SIGNATURE JEROME L. DUFFY
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1997 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000823342
<NAME> KEMPER BLUE CHIP FUND
<SERIES>
<NUMBER> 001
<NAME> CLASS A
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> OCT-31-1997
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<INVESTMENTS-AT-VALUE> 451,771
<RECEIVABLES> 23,484
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
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<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1997 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000823342
<NAME> KEMPER BLUE CHIP FUND
<SERIES>
<NUMBER> 002
<NAME> CLASS B
<MULTIPLIER> 1,000
<S> <C>
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<FISCAL-YEAR-END> OCT-31-1997
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<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1997 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000823342
<NAME> KEMPER BLUE CHIP FUND
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<TABLE> <S> <C>
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<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1997 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000823342
<NAME> KEMPER BLUE CHIP FUND
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<SHARES-COMMON-PRIOR> 1
<ACCUMULATED-NII-CURRENT> 1,880
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<DISTRIBUTIONS-OF-GAINS> (4)
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</TABLE>
Exhibit 770
Kemper Blue Chip Fund
Form N-SAR for the period ended 10/31/97
File No. 811-5357
Offering Date: 9/25/97
Description of Security: Highwoods Properties Inc.
Total Amount of Underwriting: 7,500,000 Shares
Name of Fund: Kemper Blue Chip Fund
Amount Purchased: 100,000 Shares
Affiliate That Participated in Underwriting: Gruntal and Co.
Amount Purchased 4% Limit (1): 1.4%
Amount Purchased 3% Limit (2): 0.8%
Purchased From: Merrill Lynch, Pierce, Fenner & Smith Inc.
Underwriting syndicates members: Merrill Lynch, Pierce,
Fenner & Smith Inc., Montgomery Securities, Morgan Stanley &
Co. Inc., Prudential Securities Inc., Scott & Stringfellow,
Inc., Smith Barney Inc., BT Alex Brown Inc., Donaldson,
Lufkin & Jenrette Securities Corp., A.G. Edwards & Sons,
Inc., Lazard Freres & Co. LLC, Legg Mason Wood Walker, Inc.,
Oppenheimer & Co. Inc., PaineWebber Inc., The Robinson-
Humphrey Co., Inc., Salomon Brothers Inc., Schroder & Co.
Inc., Advest, Inc., Robert W. Baird & Co. Inc., J.C.
Bradford & Co., Craigie Inc., Dain Bosworth Inc., Davenport
& Co. LLC, Dominick & Dominick, Inc., EVEREN Securities,
Inc., Fahnestock & Co. Inc., First of Michigan Corp., Furman
Selz LLC, J.J.B. Hilliard, W.L. Lyons, Inc.,
Interstate/Johnson Lane Corp., Janney Montgomery Scott Inc.,
Edward D. Jones & Co., L.P., Marion Bass Securities Corp.,
McDonald & Co. Securities, Inc., Morgan Keegan & Co., Inc.,
Piper Jaffrey Inc., Principal Financial Securities, Inc.,
Ragen MacKenzie Inc., Rauscher Pierce Refsnes, Inc., Raymond
James & Associates, Inc., Stephens Inc., Sterne, Agee &
Leach, Inc., Stifel, Nicolaus & Co., Inc., Sutro & Co. Inc.,
Tucker Anthony Inc., Wheat, First Securities, Inc.
(1) The amount purchased may not be greater than 4% of the
total principal amount of an issue. Percentage
applies
to all Funds purchasing shares.
(2) The amount purchased may not be greater than 3% of the
Funds total assets.
REPORT OF INDEPENDENT AUDITORS
Board of Trustees
Kemper Funds
In planning and performing our audit of the financial statements of
each of the Kemper Funds listed in Exhibit A attached hereto (the
"Funds") for the period ended as of the date listed in Exhibit A
attached hereto ("Report Date"), we considered their internal
control, including control activities 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 the
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 internal control, errors or
irregularities 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 the 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
errors or irregularities 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 internal control and its operation, including controls
for safeguarding securities, that we consider to be material
weaknesses as defined above as of Report Date.
This report is intended solely for the information and use of
management and the Securities and Exchange Commission.
ERNST & YOUNG LLP
Chicago, Illinois
December 16, 1997
Kemper Funds Exhibit A
October 31, 1997
Kemper Total Return Fund
Kemper Diversified Income Fund
Kemper Technology Fund
Kemper U.S. Government Securities Fund
Kemper Income & Capital Preservation Fund
Kemper International Fund
Kemper Blue Chip Fund
