To the Audit Committee of the Board of Directors of
American Gas Index Fund, Inc.:
We have examined management's assertion about American Gas
Index Fund, Inc.'s (the Fund's) compliance with the
requirements of subsections (b) and (c) of Rule 17f-2 under
the Investment Company Act of 1940 (the Act) as of July 19,
1999, included in the accompanying Management Statement
Regarding Compliance with Certain Provisions of the
Investment Company Act of 1940. Management is responsible
for the Fund's compliance with those requirements. Our
responsibility is to express an opinion on management's
assertion about the Fund'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 Fund'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 19, 1999, and with respect to
agreement of security purchases and sales, for the period
from March 31, 1999, the date of our last audit, through
July 19, 1999:
* Confirmation of all securities held by Rushmore Trust
and Savings, FSB (Rushmore Trust) in book entry form for
the account of the Fund;
* Confirmation from Rushmore Trust that the securities
held for the account of the Fund were held for the account
of Rushmore Trust by Mellon Bank, N.A. (Mellon), as agent
for Rushmore Trust;
* Confirmation with Mellon of all securities held by
Mellon in book entry form for the account of Rushmore
Trust;
* Confirmation with brokers that all purchases and sales
outstanding were in agreement with the Fund's records;
* Reconciliation of all such securities to the books and
records of the Rushmore Trust and the Fund;
* Confirmation of all repurchase agreements with brokers
and agreement of underlying collateral with broker's records;
* Agreement of selected security purchases and security
sales since our last report from the books and records of
the Fund 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 Fund's compliance with specified
requirements.
In our opinion, management's assertion that American Gas
Index Fund, Inc. was in compliance with the requirements of
subsections (b) and (c) of Rule 17f-2 of the Investment
Company Act of 1940 as of July 19, 1999 with respect to
securities reflected in the investment account of the Fund
is fairly stated, in all material respects.
This report is intended solely for the information and use
of management of American Gas Index Fund, Inc., and the
Securities and Exchange Commission and is not intended to
be and should not be used by anyone other than these
specified parties.
Deloitte & Touche LLP
Princeton, New Jersey
August 6, 1999
Management Statement Regarding Compliance with
Certain Provisions of the Investment Company Act of 1940
We, as members of management of American Gas Index Fund,
Inc. (the Fund), are responsible for complying with the
requirements of subsections (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 internal controls over compliance
with those requirements. We have performed an evaluation
of the Fund's compliance with the requirements of
subsections (b) and (c) of Rule 17f-2 as of July 19, 1999
and from March 31, 1999 (the date of Deloitte & Touche
LLP's last audit) through July 19, 1999.
Based on this evaluation, we assert that the Fund was
in compliance with the requirements of subsections (b)
and (c) of Rule 17f-2 of the Investment Company Act of
1940 as of July 19, 1999 and from March 31, 1999 (the
date of Deloitte & Touche LLP's last audit) through July
19, 1999, with respect to securities reflected in the
investment accounts of American Gas Index Fund, Inc.
Richard J. Garvey
Chairman
Timothy N. Coakley
Vice President
