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Report of Independent Accountants
To the Board of Trustees
Fountain Square Funds
We have examined management's assertion, included in the accompanying Management
Statement Regarding Compliance with Certain Provisions of the Investment Company
Act of 1940, that the Fountain Square Funds (the "Company") was in 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, 1998 with respect to securities
and similar investments reflected in the investment account of the Funds.
Management is responsible for the Funds' compliance with those requirements.
Our responsibility is to express an opinion on management's assertion about the
Company's 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 Company's 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, 1998, and with respect to agreement of security and
similar investments purchases and sales, for the period from May 29, 1998 (the
date of last examination) through July 31, 1998;
- - Confirmation of all securities and similar investments held by Federal
Reserve Bank of Cleveland, State Street Bank & Trust Co., N.A., Depository
Trust Company, Bank of New York, and Participant Trust Company in book
entry form;
- - Reconciliation of confirmation results as to all such securities and
investments to the books and records of the Company and the Custodian;
- - Confirmation of all repurchase agreements with brokers/banks and agreement
of underlying collateral with Fifth Third Bank and tri-party custodian
records; and
- - Agreement of 2 security and/or investment purchases and 2 security and/or
investment sales or maturities since our last examination from the books
and records of the Company 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 Company's
compliance with specified requirements.
In our opinion, management's assertion that the Fountain Square Funds were 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, 1998, with respect to securities
and similar investments reflected in the investment account of the Company, is
fairly stated, in all material respects.
This report is intended solely for the information and use of management of the
Fountain Square Funds and the Securities and Exchange Commission and should not
be used for any other purpose.
Ernst & Young LLP
Cincinnati, Ohio
October 30, 1998
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Management Statement Regarding Compliance with
Certain Provisions of the Investment Company Act of 1940
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We, as members of management of the Fountain Square Funds (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, 1998.
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, 1998 with respect to securities and similar
investments reflected in the investment account of the Company.
Fountain Square Funds
By:
/s/ Stephen G. Mintos
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Stephen Mintos
President
