PNC FUND, 497, 1996-09-18

PNC FUND
497, 1996-09-18

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<PAGE>

[ART]
PROSPECTUS

CORE BOND
PORTFOLIO

Investor
Shares

COMPASS
--------------------
[LOGO] CAPITAL FUNDS

N O T Investments are not FDIC insured, are
FDIC not deposits or obligations of any bank,
INSURED and involve risk including
possible loss of principal.
<PAGE>

May 31, 1996
The Core Bond Portfolio Investor Shares (as revised August 1, 1996)
- --------------------------------------------------------------------------------
Compass Capital Funds SM ("Compass Capital" or the "Fund")
consist of twenty-nine investment portfolios. This Prospectus
describes the Investor Shares of one of those portfolios, the
Core Bond Portfolio (the "Portfolio").

This Prospectus contains information that a prospective in-
vestor needs to know before investing. Please keep it for fu-
ture reference. A Statement of Additional Information dated
January 16, 1996 has been filed with the Securities and Ex-
change Commission (the "SEC"). The Statement of Additional
Information may be obtained free of charge from the Fund by
calling (800) 441-7762. The Statement of Additional Informa-
tion, as supplemented from time to time, is incorporated by
reference into this Prospectus.

SHARES OF THE PORTFOLIO ARE NOT DEPOSITS OR OBLIGATIONS OF,
OR GUARANTEED OR ENDORSED BY, PNC BANK, NATIONAL ASSOCIATION
OR ANY OTHER BANK AND ARE NOT INSURED BY, GUARANTEED BY, OB-
LIGATIONS OF OR OTHERWISE SUPPORTED BY THE U.S. GOVERNMENT,
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RE-
SERVE BOARD OR ANY OTHER GOVERNMENTAL AGENCY. INVESTMENTS IN
THE PORTFOLIO INVOLVE INVESTMENT RISKS, INCLUDING POSSIBLE
LOSS OF PRINCIPAL AMOUNT INVESTED.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURI-
TIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CON-
TRARY IS A CRIMINAL OFFENSE.

<PAGE>

The Core Bond Portfolio Of Compass Capital Funds
- --------------------------------------------------------------------------------

The Core Bond Portfolio of COMPASS CAPITAL FUNDS is one of
twelve investment portfolios that provide investors with a broad
spectrum of investment alternatives within the fixed income sec-
tor. Eight of these portfolios, including the Core Bond Portfo-
lio, invest in taxable bonds, and four of these portfolios in-
vest in tax-exempt bonds. A detailed description of the Core
Bond Portfolio begins on page 9. To obtain a prospectus describ-
ing the Fund's other fixed income portfolios, call (800) 441-
7762.

The Portfolio's performance benchmark is the Lehman Brothers Ag-
gregate Index and its Lipper Peer Group is the Lipper Intermedi-
ate Investment Grade Debt Average. For more information on the
Portfolio's benchmark, see the Appendix at the back of this Pro-
spectus.

PNC Asset Management Group, Inc. ("PAMG") serves as the Fund's
investment adviser. BlackRock Financial Management, Inc.
("BlackRock") serves as sub-adviser to the Portfolio.

UNDERSTANDING This Prospectus has been crafted to provide detailed, accurate
THE COMPASS and comprehensive information on the Compass Capital Core Bond
CAPITAL Portfolio. We intend this document to be an effective tool as
CORE BOND you explore one approach to fixed income investing. You may wish
PORTFOLIO to use the table of contents on page 4 to find a description of
the Portfolio, including its investment objective, portfolio
management style, risks and charges and expenses.

CONSIDERING There can be no assurance that any mutual fund will achieve its
THE RISKS investment objective. The Portfolio may purchase mortgage-
IN BOND related, asset-backed and illiquid securities; enter into repur-
INVESTING chase and reverse repurchase agreements and engage in leveraging
techniques; lend portfolio securities to third parties; and en-
ter into futures contracts and options. See "What Additional In-
vestment Policies And Risks Apply?"

INVESTING For information on how to purchase and redeem shares of the
IN THE Portfolio, see "How Are Shares Purchased" and "How Are Shares
COMPASS Redeemed?"
CAPITAL
FUNDS

3
<PAGE>

Asking The Key Questions
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
What Are The Expenses Of The Portfolio?...................... 5
What Are The Portfolio's Financial Highlights?............... 7
What Is The Portfolio?....................................... 9
What Types Of Securities Are In The Portfolio?............... 10
What Are The Portfolio's Fundamental Investment
Limitations?................................................ 11
What Additional Investment Policies And Risks Apply?......... 12
Who Manages The Fund?........................................ 21
What Pricing Options Are Available To Investors?............. 25
What Are The Key Considerations In Selecting A Pricing
Option?..................................................... 27
How Are Shares Purchased?.................................... 28
How Are Shares Redeemed?..................................... 30
What Are The Shareholder Features Of The Fund?............... 32
What Is The Schedule Of Sales Charges And Exemptions?........ 35
How Is Net Asset Value Calculated?........................... 40
How Frequently Are Dividends And Distributions Made To
Investors?.................................................. 41
How Are Fund Distributions Taxed?............................ 42
How Is The Fund Organized?................................... 44
How Is Performance Calculated?............................... 45
How Can I Get More Information?.............................. 47
</TABLE>

4
<PAGE>

What Are The Expenses Of The Portfolio?
- --------------------------------------------------------------------------------
Below is a summary of the annual operating expenses expected to be incurred by
Investor Shares of the Portfolio for the current fiscal year ending September
30, 1996 as a percentage of average daily net assets. An example based on the
summary is also shown.

<TABLE>
<CAPTION>
CORE BOND
PORTFOLIO
INVESTOR A INVESTOR B
<S> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Front-End Sales Charge(/1/)
(as a percentage of offering price) 4.0% None
Sales Charge on Reinvested Dividends None None
Deferred Sales Charge(/1/)(/2/)
(as a percentage of original purchase price or
redemption proceeds, whichever is lower) None 4.5%
ANNUAL PORTFOLIO OPERATING EXPENSES (AS A PERCENTAGE
OF AVERAGE NET ASSETS)
Advisory fees (after fee waivers)(/3/) .30% .30%
12b-1 fees(/3/)(/4/) .00 .75
Other operating expenses (after fee waivers)(/3/) .72 .72
------ ------
Shareholder servicing fee .25 .25
Shareholder processing fee .15 .15
Other expenses .32 .32
---- ----
Total Portfolio operating expenses (after fee
waivers)(/3/) 1.02% 1.77%
====== ======
</TABLE>

(1) Reduced front-end sales charges may be available. A deferred sales charge
of up to 1.00% is assessed on certain redemptions of Investor A Shares that
are purchased with no initial sales charge as part of an investment of
$1,000,000 or more. See "What Is the Schedule of Sales Charges and Exemp-
tions?"
(2) This amount applies to redemptions during the first year. The deferred
sales charge decreases for redemptions made in subsequent years. No de-
ferred sales charge is charged after the sixth year on Investor B Shares.
See "What Is the Schedule of Sales Charges and Exemptions?"
(3) "Other expenses" includes the administration fees payable by the Portfolio.
Without waivers, advisory fees would be .50% and administration fees would
be .23% for each class of the Portfolio. PAMG and the Portfolio's adminis-
trators are under no obligation to waive fees or reimburse expenses, but
have informed the Fund that they expect to waive fees and reimburse ex-
penses during the remainder of the current fiscal year as necessary to
maintain the Portfolio's total operating expenses at the levels set forth
in the table. The information in the table is based on the advisory and ad-
ministration fees and other expenses payable after fee waivers for the fis-
cal year ended September 30, 1995, as restated to reflect current expenses
and fee waivers. Without waivers, "Other operating expenses" would be: (i)
.80% for Investor A Shares; and (ii) .80% for Investor B Shares; and "Total
Portfolio operating expenses" would be: (iii) 1.30% for Investor A Shares;
and (iv) 2.05% for Investor B Shares. The Portfolio does not expect to in-
cur any 12b-1 fees with respect to Investor A Shares (otherwise payable at
the maximum rate of .10%) during the current fiscal year.
(4) Investors with a long-term perspective may prefer Investor A Shares, as de-
scribed under "What Are The Key Considerations In Selecting A Pricing Op-
tion?" on page 27. Investor A Shares do not currently pay 12b-1 fees. Long-
term investors in Investor B Shares (as well as investors in Investor A
Shares if 12b-1 fees are charged in the future) may pay more than the eco-
nomic equivalent of the maximum front-end sales charges permitted by the
rules of the NASD.
(1) Reduced front-end sales charges may be available. A deferred sales charge
of up to 1.00% is assessed on certain redemptions of Investor A Shares that
are purchased with no initial sales charge as part of an investment of
$1,000,000 or more. See "What Is the Schedule of Sales Charges and Exemp-
tions?"

5
<PAGE>

EXAMPLE

An investor in Investor Shares would pay the following expenses on a $1,000
investment assuming (1) 5% annual return, and (2) redemption at the end of
each time period:

<TABLE>
<CAPTION>
ONE YEAR THREE YEARS FIVE YEARS TEN YEARS
<S> <C> <C> <C> <C>
Core Bond Portfolio
A Shares* $50 $71 $ 94 $160
B Shares (Redemption)** 63 93 119 179***
B Shares (No Redemption) 18 56 96 179***
</TABLE>

* Reflects the imposition of the maximum front-end sales charge at the begin-
ning of the period.
** Reflects the deduction of the deferred sales charge.
*** Based on the conversion of the Investor B Shares to Investor A Shares af-
ter seven years.

The foregoing Tables and Example are intended to assist investors in under-
standing the costs and expenses that an investor in the Portfolio will bear
either directly or indirectly. They do not reflect any charges that may be im-
posed by brokers or other institutions directly on their customer accounts in
connection with investments in the Portfolio.

THE EXAMPLE SHOWN ABOVE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE
INVESTMENT RETURN OR OPERATING EXPENSES. ACTUAL INVESTMENT RETURN AND OPERAT-
ING EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN.

6
<PAGE>

What Are The Portfolio's Financial Highlights?
- --------------------------------------------------------------------------------

The Portfolio commenced operations on December 9, 1992 as the
Core Fixed Income Portfolio, a separate investment portfolio
(the "Predecessor Core Bond Portfolio") of The BFM Institutional
Trust, Inc., which was organized as a Maryland Business Corpora-
tion. On January 12, 1996, the assets and liabilities of the
Predecessor Core Bond Portfolio were transferred to the Portfo-
lio, which had no prior operating history. Prior to such trans-
fer, the Predecessor Core Bond Portfolio offered one class of
shares to institutional investors (now called Institutional
Shares).

The following financial information has been derived from the
financial statements incorporated by reference into the State-
ment of Additional Information and has been audited by the Port-
folio's accountants. This financial information should be read
together with those financial statements. Further information
about the performance of the Portfolio is available in the
Fund's annual shareholder reports. Both the Statement of Addi-
tional Information and the annual shareholder reports may be ob-
tained from the Fund free of charge by calling (800) 441-7762.

7
<PAGE>

Financial Highlights
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)

CORE BOND PORTFOLIO

<TABLE>
<CAPTION>
INVESTOR A INVESTOR B
CLASS CLASS
---------- ----------
FOR THE FOR THE
PERIOD PERIOD
1/31/96/1/ 3/18/96/1/
THROUGH THROUGH
3/31/96 3/31/96
---------- ----------
<S> <C> <C>
Net asset value at beginning of period........ $ 9.99 $9.58
------ -----
Income from investment operations.............
Net investment income........................ 0.08 0.01
Net gain (loss) on investments and foreign
currency related transactions (both realized
and unrealized)............................. (0.38) 0.03
------ -----
Total from investment operations............. (0.30) 0.04
------ -----
Less distributions
Distributions from net investment income..... (0.08) (0.01)
Distributions from net realized capital
gains....................................... -- --
------ -----
Total distributions.......................... (0.08) (0.01)
------ -----
Net asset value at end of period.............. $9.61 $9.61
====== =====
Total return.................................. (2.96)%/3/,/5/ 0.33%/4/,/5/
Ratios/Supplemental data
Net assets at end of period (in thousands)... $80 $77
Ratios of operating expenses to average net
assets
After advisory/administration fee waivers.... 1.02%/2/,/6/ 1.77%/2/,/6/
Before advisory/administration fee waivers... 1.27%/2/ 2.02%/2/
Ratios of net investment income to average net
assets
After advisory/administration fee waivers.... 5.43%/2/ 4.71%/2/
Before advisory/administration fee waivers... 5.19%/2/ 4.46%/2/
Portfolio turnover rate....................... 723% 723%
</TABLE>

(1) Commencement of operations of the respective Investor A and Investor B
Classes.
(2) Annualized.
(3) Sales load not reflected in total return.
(4) Contingent deferred sales load not reflected in total return.
(5) Not annualized.
(6) Including interest expense, ratios for Investor A and Investor B classes
would have been 1.11% and 1.86%, respectively, for the period ended March
31, 1996. For the periods prior to March 31, 1996, interest income was pre-
sented net of interest expense.

8
<PAGE>

What Is The Portfolio?
- --------------------------------------------------------------------------------

The COMPASS CAPITAL FUND family consists of 29 portfolios and
has been structured to include many different investment styles
across the spectrum of fixed income investments so that invest-
ors may participate across multiple disciplines in order to seek
their long-term financial goals.

In certain investment cycles and over certain holding periods, a
fund that invests in any one of these styles may perform above
or below the market. An investment program that combines these
multiple disciplines allows investors to select from among these
various product options in the way that most closely fits the
individual's investment goals and sentiments.

The investment objective of the Core Bond Portfolio is to real-
ize a total rate of return that exceeds the total return of the
Lehman Brothers Aggregate Index. The Portfolio seeks to achieve
this objective by investing in a broad range of debt securities
within the investment grade spectrum (i.e. obligations with a
minimum credit quality of BBB or higher). The Portfolio's ap-
proximate dollar-weighted average maturity will be between 5 and
10 years. The Portfolio is structured to have a comparable dura-
tion to its benchmark, the Lehman Brothers Aggregate Index. (Du-
ration, which measures price sensitivity to interest rate
changes, is not necessarily equal to average maturity.)

9
<PAGE>

What Types Of Securities Are In The Portfolio?
- --------------------------------------------------------------------------------

The following table summarizes the types of securities found in the Portfolio
according to the following designations:

Yes:The Portfolio will hold a significant concentration of these securities
at all times.

Elig.: Eligible; the Portfolio may purchase these securities, but they may or
may not be a significant holding at a given time.

Temp.: Temporary; the Portfolio may purchase these securities, but under nor-
mal market conditions is not expected to do so.

No: The Portfolio may not purchase these securities.

<TABLE>
<CAPTION>
NON FOREIGN
AGENCY/ SECURITIES/
AGENCY COMMERCIAL CURRENCY
TREASURIES AGENCIES MBS/1/ MBS/1/ CORP. ABS/2/ RISK MUNICIPALS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Yes Yes Yes Elig. Yes Yes No Elig.
</TABLE>

/1/MBS = mortgage-backed securities
/2/ABS = asset-backed securities

10
<PAGE>

What Are The Portfolio's Fundamental Investment Limitations?
- --------------------------------------------------------------------------------
The Portfolio's investment objective and policies may be changed by the Fund's
Board of Trustees without shareholder approval. However, shareholders will be
given at least 30 days' notice before any such change. No assurance can be pro-
vided that the Portfolio will achieve its investment objective.

The Portfolio has also adopted certain fundamental investment limitations that
may be changed only with the approval of a "majority of the outstanding shares
of the Portfolio" (as defined in the Statement of Additional Information). Sev-
eral of the Portfolio's fundamental investment policies, which are set forth in
full in the Statement of Additional Information, are summarized below.

The Portfolio may not:

(1) purchase securities (except U.S. Government securities) if more than 5% of
its total assets will be invested in the securities of any one issuer, ex-
cept that up to 25% of the Portfolio's total assets may be invested without
regard to this 5% limitation; and

(2) invest 25% or more of its total assets in one or more issuers conducting
their principal business activities in the same industry.

The investment limitations stated above are applied at the time investment se-
curities are purchased.

In order to permit the sale of its shares in certain states, the Fund may make
commitments more restrictive than the investment policies and limitations de-
scribed in this Prospectus. If the Fund determines that any such commitment is
no longer in the best interests of the Portfolio, it will revoke the commitment
by terminating sales of shares of the Portfolio in the state involved.

11
<PAGE>

What Additional Investment Policies And Risks Apply?
- --------------------------------------------------------------------------------

INVESTMENT QUALITY. Securities acquired by the Portfolio will be rated invest-
ment grade at the time of purchase (within the four highest rating categories
by Standard & Poor's Ratings Group ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Duff & Phelps Credit Co. or Fitch Investor Services, Inc.) or, if
unrated, of comparable quality as determined by the Portfolio's sub-adviser.
Securities rated "Baa" on "BBB" are generally considered to be investment grade
although they have speculative characteristics. If a security's rating is re-
duced below the minimum rating that is permitted for the Portfolio, the Portfo-
lio's sub-adviser will consider whether the Portfolio should continue to hold
the security.

INVESTMENT CONCENTRATION. The Portfolio will normally invest at least 80% of
the value of its total assets in debt securities.

MUNICIPAL INVESTMENTS. The Portfolio may invest in obligations issued by or on
behalf of states, territories and possessions of the United States, the Dis-
trict of Columbia and their political sub-divisions, agencies, instrumentali-
ties and authorities ("Municipal Obligations") the interest on which is exempt
from regular Federal income tax and is not an item of tax preference for pur-
poses of the Federal alternative minimum tax. The two principal classifications
of Municipal Obligations are "general obligation" securities and "revenue" se-
curities. General obligation securities are secured by the issuer's pledge of
its full faith, credit and taxing power for the payment of principal and inter-
est. Revenue securities are payable only from the revenues derived from a par-
ticular facility or class of facilities or, in some cases, from the proceeds of
a special excise tax or other specific revenue source such as the user of the
facility being financed. Revenue securities include private activity bonds
which are not payable from the unrestricted revenues of the issuer.

Consequently, the credit quality of private activity bonds is usually directly
related to the credit standing of the corporate user of the facility involved.
Municipal Obligations may also include "moral obligation" bonds, which are nor-
mally issued by special purpose public authorities. If the issuer of moral ob-
ligation bonds is unable to meet its debt service obligations from current rev-
enues, it may draw on a reserve fund the restoration of which is a moral com-
mitment but not a legal obligation of the state or municipality which created
the issuer.

Also included within the general category of Municipal Obligations are partici-
pation certificates in a lease, an installment purchase contract, or a condi-
tional sales contract ("lease obligations") entered into by a state or politi-
cal subdivision to finance the acquisition or construction of equipment, land,
or facilities. Although lease obligations are not general obligations of the
issuer for which the state or other governmental body's unlimited taxing power
is pledged, certain lease obligations are backed by a covenant to appropriate
money to make the lease obligation payments. However, under certain lease obli-
gations, the state or governmental body has no obligation to make these pay-
ments in future years unless money is appropriated on a yearly basis. Although
"non-appropriation" lease obligations are secured by the leased property, dis-
position of the property in the event of foreclosure might prove difficult.
These securities repre-

12
<PAGE>

sent a relatively new type of financing that is not yet as marketable as more
conventional securities.

Opinions relating to the validity of Municipal Obligations and to the exemption
of interest thereon from Federal and state income tax are rendered by counsel
to the respective issuers and sponsors of the obligations at the time of issu-
ance. The Fund and its investment adviser and sub-adviser will rely on such
opinions and will not review independently the underlying proceedings relating
to the issuance of Municipal Obligations, the creation of any tax-exempt deriv-
ative securities, or the bases for such opinions.

MORTGAGE-RELATED AND ASSET-BACKED SECURITIES. The Portfolio may purchase secu-
rities that are secured or backed by mortgages as well as other assets (e.g.,
automobile loans and credit card receivables). Issuers of these mortgage-re-
lated and asset-backed securities include the U.S. Government, the Government
National Mortgage Association ("GNMA"), the Federal National Mortgage Associa-
tion ("FNMA"), the Federal Home Loan Mortgage Corporation ("FHLMC"), and pri-
vate issuers such as commercial banks, financial companies, finance subsidiar-
ies of industrial companies, savings and loan associations, mortgage banks and
investment banks.

The Portfolio may acquire several types of mortgage-related securities, includ-
ing guaranteed mortgage pass-through certificates, which provide the holder
with a pro rata interest in the underlying mortgages, adjustable rate mortgage-
related securities ("ARMs") and collateralized mortgage obligations ("CMOs"),
which provide the holder with a specified interest in the cash flow of a pool
of underlying mortgages or other mortgage-backed securities. Issuers of CMOs
ordinarily elect to be taxed as pass-through entities known as real estate
mortgage investment conduits ("REMICs"). CMOs are issued in multiple classes,
each with a specified fixed or floating interest rate and a final distribution
date. The relative payment rights of the various CMO classes may be structured
in a variety of ways.

Non-mortgage asset-backed securities involve certain risks that are not pre-
sented by mortgage-related securities. Primarily, these securities do not have
the benefit of the same security interest in the underlying collateral. Credit
card receivables are generally unsecured and the debtors are entitled to the
protection of a number of state and Federal consumer credit laws, many of which
give debtors the right to set off certain amounts owed on the credit cards,
thereby reducing the balance due. Most issuers of automobile receivables permit
the servicers to retain possession of the underlying obligations. If the
servicer were to sell these obligations to another party, there is a risk that
the purchaser would acquire an interest superior to that of the holders of the
related automobile receivables. In addition, because of the large number of ve-
hicles involved in a typical issuance and technical requirements under state
laws, the trustee for the holders of the automobile receivables may not have an
effective security interest in all of the obligations backing such receivables.
Therefore, there is a possibility that recoveries on repossessed collateral may
not, in some cases, be able to support payments on these securities.

13
<PAGE>

The yield characteristics of mortgage-related and asset-backed securities dif-
fer from traditional debt securities. A major difference is that the principal
amount of the obligations may be prepaid at any time because the underlying as-
sets (i.e., loans) generally may be prepaid at any time. As a result, if a
mortgage-related or asset-backed security is purchased at a premium, a prepay-
ment rate that is faster than expected will reduce yield to maturity, while a
prepayment rate that is slower than expected will have the opposite effect of
increasing yield to maturity. Conversely, if one of these securities is pur-
chased at a discount, faster than expected prepayments will increase, while
slower than expected prepayments will decrease, yield to maturity. In calculat-
ing the average weighted maturity of a Portfolio, the maturity of mortgage-re-
lated and asset-backed securities will be based on estimates of average life
which take prepayments into account.

Prepayments on mortgage-related and asset-backed securities generally increase
with falling interest rates and decrease with rising interest rates; further-
more, prepayment rates are influenced by a variety of economic and social fac-
tors. In general, the collateral supporting non-mortgage asset-backed securi-
ties is of shorter maturity than mortgage loans and is less likely to experi-
ence substantial prepayments. Like other fixed income securities, when interest
rates rise the value of a mortgage-related or asset-backed security generally
will decline; however, when interest rates decline, the value of these securi-
ties that have prepayment features may not increase as much as that of other
fixed income securities.

STRIPPED AND ZERO COUPON OBLIGATIONS. To the extent consistent with its invest-
ment objective, the Portfolio may purchase Treasury receipts and other
"stripped" securities that evidence ownership in either the future interest
payments or the future principal payments on U.S. Government and other obliga-
tions. These participations, which may be issued by the U.S. Government (or a
U.S. Government agency or instrumentality) or by private issuers such as banks
and other institutions, are issued at a discount to their "face value," and may
include stripped mortgage-backed securities ("SMBS"). Stripped securities, par-
ticularly SMBS, may exhibit greater price volatility than ordinary debt securi-
ties because of the manner in which their principal and interest are returned
to investors.

SMBS are usually structured with two or more classes that receive different
proportions of the interest and principal distributions from a pool of mort-
gage-backed obligations. A common type of SMBS will have one class receiving
all of the interest, while the other class receives all of the principal. How-
ever, in some cases, one class will receive some of the interest and most of
the principal while the other class will receive most of the interest and the
remainder of the principal. If the underlying obligations experience greater
than anticipated prepayments of principal, the Portfolio may fail to fully re-
coup its initial investment. The market value of SMBS can be extremely volatile
in response to changes in interest rates. The yields on a class of SMBS that
receives all or most of the interest are generally higher than prevailing mar-
ket yields on other mortgage-related obligations because their cash flow pat-
terns are also volatile and there is a greater risk that the initial investment
will not be fully recouped.

SMBS issued by the U.S. Government (or a U.S. Government agency or instrumen-
tality) may be considered liquid under guidelines established by the Fund's
Board of Trustees if they can

14
<PAGE>

be disposed of promptly in the ordinary course of business at a value reasona-
bly close to that used in the calculation of the Portfolio's per share net as-
set value.

The Portfolio may invest in zero-coupon bonds, which are normally issued at a
significant discount from face value and do not provide for periodic interest
payments. Zero-coupon bonds may experience greater volatility in market value
than similar maturity debt obligations which provide for regular interest pay-
ments.

CORPORATE AND BANK OBLIGATIONS. To the extent consistent with its investment
objective, the Portfolio may invest in debt obligations of domestic corpora-
tions and banks. Bank obligations may include certificates of deposit, notes,
bankers' acceptances and fixed time deposits. These obligations may be general
obligations of the parent bank or may be limited to the issuing branch or sub-
sidiary by the terms of a specific obligation or by government regulation. The
Portfolio may also make interest-bearing savings deposits in commercial and
savings banks in amounts not in excess of 5% of its total assets. For purposes
of determining the permissibility of an investment in bank obligations, the to-
tal assets of a bank are determined on the basis of the bank's most recent an-
nual financial statements.

U.S. GOVERNMENT OBLIGATIONS. Treasury obligations differ only in their interest
rates, maturities and times of issuance. Obligations of certain agencies and
instrumentalities of the U.S. Government such as the GNMA are supported by the
United States' full faith and credit; others such as those of the FNMA and the
Student Loan Marketing Association are supported by the right of the issuer to
borrow from the Treasury; others such as those of the Federal Farm Credit Banks
or the FHLMC are supported only by the credit of the instrumentality. No assur-
ance can be given that the U.S. Government would provide financial support to
U.S. Government-sponsored agencies or instrumentalities if it is not obligated
to do so by law.

INTEREST RATE TRANSACTIONS. The Portfolio may enter into interest rate swaps
and may purchase or sell interest rate caps and floors. The Portfolio expects
to enter into these transactions primarily to preserve a return or spread on a
particular investment or portion of its holdings, as a duration management
technique or to protect against an increase in the price of securities the
Portfolio anticipates purchasing at a later date. The Portfolio intends to use
these transactions as a hedge and not as a speculative investment.

Interest rate swaps involve the exchange by the Portfolio with another party of
their respective commitments to pay or receive interest, e.g., an exchange of
floating rate payments for fixed rate payments. The purchase of an interest
rate cap entitles the purchaser, to the extent that a specified index exceeds a
predetermined interest rate, to receive payments of interest on a notional
principal amount from the party selling such interest rate cap. The purchase of
an interest rate floor entitles the purchaser, to the extent that a specified
index falls below a predetermined interest rate, to receive payments of inter-
est on a notional principal amount from the party selling such interest rate
floor.

OPTIONS AND FUTURES CONTRACTS. To the extent consistent with its investment ob-
jective, the Portfolio may write covered call options, buy put options, buy
call options and write secured put options for the purpose of hedging or earn-
ing additional income, which may be deemed

15
<PAGE>

speculative. These options may relate to particular securities, financial in-
struments, securities indices or the yield differential between two securities,
and may or may not be listed on a securities exchange and may or may not be is-
sued by the Options Clearing Corporation. The Portfolio will not purchase put
and call options where the aggregate premiums on outstanding options exceed 5%
of its net assets at the time of purchase, and will not write options on more
than 25% of the value of its net assets (measured at the time an option is
written). Options trading is a highly specialized activity that entails greater
than ordinary investment risks. In addition, unlisted options are not subject
to the protections afforded purchasers of listed options issued by the Options
Clearing Corporation, which performs the obligations of its members if they de-
fault.

To the extent consistent with its investment objective, the Portfolio may also
invest in futures contracts and options on futures contracts for hedging pur-
poses or to maintain liquidity. The value of the Portfolio's contracts may
equal or exceed 100% of the Portfolio's total assets, although the Portfolio
will not purchase or sell a futures contract unless immediately afterwards the
aggregate amount of margin deposits on its existing futures positions plus the
amount of premiums paid for related futures options is 5% or less of its net
assets.

Futures contracts obligate the Portfolio, at maturity, to take or make delivery
of certain securities or the cash value of a securities index. The Portfolio
may sell a futures contract in order to offset an expected decrease in the
value of its portfolio positions that might otherwise result from a market de-
cline. The Portfolio may do so either to hedge the value of its securities
portfolio as a whole, or to protect against declines occurring prior to sales
of securities in the value of the securities to be sold. In addition, the Port-
folio may utilize futures contracts in anticipation of changes in the composi-
tion of its holdings.

The Portfolio may purchase and sell call and put options on futures contracts
traded on an exchange or board of trade. When the Portfolio purchases an option
on a futures contract, it has the right to assume a position as a purchaser or
a seller of a futures contract at a specified exercise price during the option
period. When the Portfolio sells an option on a futures contract, it becomes
obligated to sell or buy a futures contract if the option is exercised. In con-
nection with the Portfolio's position in a futures contract or related option,
the Portfolio will create a segregated account of liquid high grade assets or
will otherwise cover its position in accordance with applicable SEC require-
ments.

The primary risks associated with the use of futures contracts and options are
(a) the imperfect correlation between the change in market value of the instru-
ments held by the Portfolio and the price of the futures contract or option;
(b) possible lack of a liquid secondary market for a futures contract and the
resulting inability to close a futures contract when desired; (c) losses caused
by unanticipated market movements, which are potentially unlimited; and (d) a
sub-adviser's inability to predict correctly the direction of securities pric-
es, interest rates and other economic factors. For further discussion of risks
involved with futures and options, see Appendix B in the Statement of Addi-
tional Information.

The Fund intends to comply with the regulations of the Commodity Futures Trad-
ing Commission exempting the Portfolio from registration as a "commodity pool
operator."

16
<PAGE>

GUARANTEED INVESTMENT CONTRACTS. The Portfolio may make limited investments in
guaranteed investment contracts ("GICs") issued by highly rated U.S. insurance
companies. Under these contracts, the Portfolio makes cash contributions to a
deposit fund of the insurance company's general account. The insurance company
then credits to the Portfolio, on a monthly basis, interest which is based on
an index (such as the Salomon Brothers CD Index), but is guaranteed not to be
less than a certain minimum rate. The Portfolio does not expect to invest more
than 5% of its net assets in GICs at any time during the current fiscal year.

SECURITIES LENDING. The Portfolio may seek additional income by lending securi-
ties on a short-term basis. The securities lending agreements will require that
the loans be secured by collateral in cash, U.S. Government securities or ir-
revocable bank letters of credit maintained on a current basis equal in value
to at least the market value of the loaned securities. The Portfolio may not
make such loans in excess of 33 1/3% of the value of its total assets. Securi-
ties loans involve risks of delay in receiving additional collateral or in re-
covering the loaned securities, or possibly loss of rights in the collateral if
the borrower of the securities becomes insolvent.

VARIABLE AND FLOATING RATE INSTRUMENTS. The Portfolio may purchase rated and
unrated variable and floating rate instruments. These instruments may include
variable amount master demand notes that permit the indebtedness thereunder to
vary in addition to providing for periodic adjustments in the interest rate.
The Portfolio may invest up to 10% of its total assets in leveraged inverse
floating rate debt instruments ("inverse floaters"). The interest rate of an
inverse floater resets in the opposite direction from the market rate of inter-
est to which it is indexed. An inverse floater may be considered to be
leveraged to the extent that its interest rate varies by a magnitude that ex-
ceeds the magnitude of the change in the index rate of interest. The higher de-
gree of leverage inherent in inverse floaters is associated with greater vola-
tility in their market values. Issuers of unrated variable and floating rate
instruments must satisfy the same criteria as set forth above for the Portfo-
lio. The absence of an active secondary market with respect to particular vari-
able and floating rate instruments, however, could make it difficult for the
Portfolio to dispose of a variable or floating rate instrument if the issuer
defaulted on its payment obligation or during periods when the Portfolio is not
entitled to exercise its demand rights.

REPURCHASE AGREEMENTS. The Portfolio may agree to purchase debt securities from
financial institutions subject to the seller's agreement to repurchase them at
an agreed upon time and price ("repurchase agreements"). Repurchase agreements
are, in substance, loans. Default by or bankruptcy of a seller would expose the
Portfolio to possible loss because of adverse market action, expenses and/or
delays in connection with the disposition of the underlying obligations.

REVERSE REPURCHASE AGREEMENTS AND OTHER BORROWINGS. The Portfolio is authorized
to make limited borrowings. If the securities held by the Portfolio should de-
cline in value while borrowings are outstanding, the net asset value of the
Portfolio's outstanding shares will decline in value by proportionately more
than the decline in value suffered by the Portfolio's securities. Borrowings
may be made through reverse repurchase agreements under which the Portfolio
sells portfolio securities to financial institutions such as banks and broker-
dealers and

17
<PAGE>

agrees to repurchase them at a particular date and price. The Portfolio may
use the proceeds of reverse repurchase agreements to purchase other securities
either maturing, or under an agreement to resell, on a date simultaneous with
or prior to the expiration of the reverse repurchase agreement. The Portfolio
may use reverse repurchase agreements when it is anticipated that the interest
income to be earned from the investment of the proceeds of the transaction is
greater than the interest expense of the transaction. This use of reverse re-
purchase agreements may be regarded as leveraging and, therefore, speculative.
Reverse repurchase agreements involve the risks that the interest income
earned in the investment of the proceeds will be less than the interest ex-
pense, that the market value of the securities sold by the Portfolio may de-
cline below the price of the securities the Portfolio is obligated to repur-
chase and that the securities may not be returned to the Portfolio. During the
time a reverse repurchase agreement is outstanding, the Portfolio will main-
tain a segregated account with the Fund's custodian containing cash, U.S. Gov-
ernment or other appropriate liquid high-grade debt securities having a value
at least equal to the repurchase price. The Portfolio's reverse repurchase
agreements, together with any other borrowings, will not exceed, in the aggre-
gate, 33 1/3% of the value of its total assets. In addition, the Portfolio may
borrow up to an additional 5% of its total assets for temporary purposes.

INVESTMENT COMPANIES. The Portfolio may invest in securities issued by other
investment companies within the limits prescribed by the 1940 Act. As a share-
holder of another investment company, the Portfolio would bear, along with
other shareholders, its pro rata portion of the other investment company's ex-
penses, including advisory fees. These expenses would be in addition to the
advisory and other expenses that the Portfolio bears directly in connection
with its own operations.

ILLIQUID SECURITIES. The Portfolio will not knowingly invest more than 15% of
the value of its net assets in securities that are illiquid. GICs, variable
and floating rate instruments that cannot be disposed of within seven days,
and repurchase agreements and time deposits that do not provide for payment
within seven days after notice, without taking a reduced price, are subject to
this 15% limit. The Portfolio may purchase securities which are not registered
under the Securities Act of 1933 (the "1933 Act") but which can be sold to
"qualified institutional buyers" in accordance with Rule 144A under the 1933
Act. Any such security will not be considered illiquid so long as it is deter-
mined by the Portfolio's sub-adviser, acting under guidelines approved and
monitored by the Board, that an adequate trading market exists for that secu-
rity. This investment practice could have the effect of increasing the level
of illiquidity in the Portfolio during any period that qualified institutional
buyers become uninterested in purchasing these restricted securities.

WHEN-ISSUED PURCHASES AND FORWARD COMMITMENTS. The Portfolio may purchase se-
curities on a "when-issued" basis and may purchase or sell securities on a
"forward commitment" basis. These transactions involve a commitment by the
Portfolio to purchase or sell particular securities with payment and delivery
taking place at a future date (perhaps one or two months later), and permit
the Portfolio to lock in a price or yield on a security that it owns or in-
tends to purchase, regardless of future changes in interest rates. When-issued
and forward commitment transactions involve the risk, however, that the price
or yield obtained in a transaction

18
<PAGE>

may be less favorable than the price or yield available in the market when the
securities delivery takes place. The Portfolio's when-issued purchases and for-
ward commitments are not expected to exceed 25% of the value of its total as-
sets absent unusual market conditions.

DOLLAR ROLL TRANSACTIONS. To take advantage of attractive opportunities in the
mortgage market and to enhance current income, the Portfolio may enter into
dollar roll transactions. A dollar roll transaction involves a sale by the
Portfolio of a mortgage-backed or other security concurrently with an agreement
by the Portfolio to repurchase a similar security at a later date at an agreed-
upon price. The securities that are repurchased will bear the same interest
rate and stated maturity as those sold, but pools of mortgages collateralizing
such securities may have different prepayment histories than those sold. During
the period between the sale and repurchase, the Portfolio will not be entitled
to receive interest and principal payments on the securities sold. Proceeds of
the sale will be invested in additional instruments for the Portfolio, and the
income from these investments will generate income for the Portfolio. If such
income does not exceed the income, capital appreciation and gain or loss that
would have been realized on the securities sold as part of the dollar roll, the
use of this technique will diminish the investment performance of the Portfolio
compared with what the performance would have been without the use of dollar
rolls. At the time that the Portfolio enters into a dollar roll transaction, it
will place in a segregated account maintained with its custodian cash, U.S.
Government securities or other liquid high grade debt obligations having a
value equal to the repurchase price (including accrued interest) and will sub-
sequently monitor the account to ensure that its value is maintained. The Port-
folio's dollar rolls, together with its reverse repurchase agreements and other
borrowings, will not exceed, in the aggregate, 33 1/3% of the value of its to-
tal assets.

Dollar roll transactions involve the risk that the market value of the securi-
ties the Portfolio is required to purchase may decline below the agreed upon
repurchase price of those securities. If the broker/dealer to whom the Portfo-
lio sells securities becomes insolvent, the Portfolio's right to purchase or
repurchase securities may be restricted and the instruments which the Portfolio
is required to repurchase may be worth less than an instrument which the Port-
folio originally held when the Portfolio is able to complete the purchase. Suc-
cessful use of mortgage dollar rolls may depend upon a sub-adviser's ability to
correctly predict interest rates and prepayments. There is no assurance that
dollar rolls can be successfully employed.

SHORT SALES. The Portfolio may only make short sales of securities "against-
the-box." A short sale is a transaction in which the Portfolio sells a security
it does not own in anticipation that the market price of that security will de-
cline. The Portfolio may make short sales both as a form of hedging to offset
potential declines in long positions in similar securities and in order to
maintain portfolio flexibility. In a short sale "against-the-box," at the time
of sale, the Portfolio owns or has the immediate and unconditional right to ac-
quire the identical security at no additional cost. When selling short
"against-the-box," the Portfolio forgoes an opportunity for capital apprecia-
tion in the security.

PORTFOLIO TURNOVER RATES. The past portfolio turnover rate of the Portfolio is
set forth above under "What Are the Portfolio's Financial Highlights?" The
Portfolio's annual portfolio turnover rate will not, however, be a factor pre-
venting a sale or purchase when the sub-adviser

19
<PAGE>

believes investment considerations warrant such sale or purchase. Portfolio
turnover may vary greatly from year to year as well as within a particular
year. High portfolio turnover rates will generally result in higher transaction
costs to the Portfolio.

INTEREST RATE RISK. The value of fixed income securities in the Portfolio can
be expected to vary inversely with changes in prevailing interest rates. Fixed
income securities with longer maturities, which tend to produce higher yields,
are subject to potentially greater capital appreciation and depreciation than
securities with shorter maturities. The Portfolio is not restricted to any max-
imum or minimum time to maturity in purchasing individual portfolio securities,
and the average maturity of the Portfolio's assets will vary between 5 and 10
years based upon its sub-adviser's assessment of economic and market condi-
tions.

20
<PAGE>

Who Manages The Fund?
- --------------------------------------------------------------------------------
BOARD OF The business and affairs of the Fund are managed under the di-
TRUSTEES rection of its Board of Trustees. The following individuals were
elected by shareholders on January 4, 1996 to serve as trustees
of Compass Capital Funds:

William O. Albertini--Executive Vice President and Chief Fi-
nancial Officer of Bell Atlantic Corporation.

Raymond J. Clark--Treasurer of Princeton University.

Robert M. Hernandez--Vice Chairman and Chief Financial Officer
of USX Corporation.

Anthony M. Santomero--Deputy Dean of The Wharton School, Uni-
versity of Pennsylvania.

David R. Wilmerding, Jr.--President of Gates, Wilmerding,
Carper & Rawlings, Inc.

ADVISER AND The adviser to the Compass Capital Funds is PNC Asset Management
SUB-ADVISER Group ("PAMG"). PAMG was organized in 1994 to perform advisory
services for investment companies, and has its principal offices
at 1835 Market Street, Philadelphia, Pennsylvania 19103. PAMG is
an indirect wholly-owned subsidiary of PNC Bank Corp., a multi-
bank holding company.

The sub-adviser to the Portfolio is BlackRock Financial Manage-
ment, Inc. ("BlackRock"), PAMG's fixed income portfolio manage-
ment subsidiary with primary offices at 345 Park Avenue, New
York, New York 10154. Scott Amero, a member of BlackRock, serves
as the Portfolio manager of the Portfolio. Mr. Amero has been a
Managing Director of BlackRock since 1990 and has served as man-
ager of the Portfolio since its inception.

For their investment advisory and sub-advisory services, PAMG
and Black Rock are entitled to fees, computed daily and payable
monthly, at the maximum annual rates set forth below. As stated
under "What Are The Expenses Of The Portfolio?" PAMG and Black
Rock intend to waive a portion of their fees during the current
fiscal year. All sub-advisory fees are paid by PAMG, and do not
represent an extra charge to the Portfolio.

21
<PAGE>

MAXIMUM ANNUAL CONTRACTUAL FEE RATE (BEFORE WAIVERS)

<TABLE>
<CAPTION>
CORE BOND PORTFOLIO
-------------------------
AVERAGE DAILY NET INVESTMENT SUB-ADVISORY
ASSETS ADVISORY FEE FEE
----------------- ------------ ------------
<S> <C> <C>
first $1 billion .500% .350%
$1 billion--$2 billion .450 .300
$2 billion--$3 billion .425 .275
greater than $3 billion .400 .250
</TABLE>

For the period from July 1, 1995 through March 31, 1996, the
Portfolio paid investment advisory fees at the annual rate
(expressed as a percentage of average daily net assets) after
voluntary fee waivers of .39%.

BlackRock strives to achieve best execution on all transac-
tions. Infrequently, brokerage transactions for the Portfolio
may be directed through registered broker/dealers who have en-
tered into dealer agreements with Compass Capital's distribu-
tor, subject to the requirements of best execution.

ADMINISTRATORS Compass Capital Group, Inc. ("CCG"), PFPC Inc. ("PFPC") and
Compass Distributors, Inc. ("CDI") (the "Administrators")
serve as the Fund's co-administrators. CCG and PFPC are indi-
rect wholly-owned subsidiaries of PNC Bank Corp. CDI is a
wholly-owned subsidiary of Provident Distributors, Inc.
("PDI"). A majority of the outstanding stock of PDI is owned
by its officers and the remaining outstanding stock is owned
by Pennsylvania Merchant Group Ltd.

The Administrators generally assist the Fund in all aspects of
its administration and operation, including matters relating
to the maintenance of financial records and fund accounting.
As compensation for these services, CCG is entitled to receive
a fee, computed daily and payable monthly, at an annual rate
of .03% of the Portfolio's average daily net assets, and PFPC
and CDI are entitled to receive a combined fee, computed daily
and payable monthly, at an annual rate of .20% of the first
$500 million of the Portfolio's average daily net assets, .18%
of the next $500 million of the Portfolio's average daily net
assets, .16% of the next $1 billion of the Portfolio's average
daily net assets and .15% of the Portfolio's average daily net
assets in excess of $2 billion. From time to time the Adminis-
trators may waive some or all of their administration fees
from the Portfolio.

For information about the operating expenses the Portfolio ex-
pects to pay for the current fiscal year, see "What Are the
Expenses of the Portfolio?"

22
<PAGE>

TRANSFER PNC Bank serves as the Portfolio's custodian and PFPC serves as
AGENT, its transfer agent and dividend disbursing agent.
DIVIDEND
DISBURSING
AGENT AND
CUSTODIAN

DISTRIBUTION Under the Fund's Distribution and Service Plan (the "Plan"), In-
AND SERVICE vestor Shares of the Portfolio bear the expense of payments
PLAN ("distribution fees") made to CDI, as the Fund's distributor
(the "Distributor"), or affiliates of PNC Bank, National Associ-
ation ("PNC Bank") for distribution and sales support services.
The distribution fees will be used primarily to compensate the
Distributor for distribution services and to compensate the Dis-
tributor and PNC Bank affiliates for sales support services pro-
vided in connection with the offering and sale of Investor
Shares. The distribution fees may also be used to reimburse the
Distributor and PNC Bank affiliates for related expenses, in-
cluding payments to brokers, dealers, financial institutions and
industry professionals ("Service Organizations") for sales sup-
port services and related expenses. Distribution fees payable
under the Plan will not exceed .10% (annualized) of the average
daily net asset value of the Portfolio's outstanding Investor A
Shares and .75% (annualized) of the average daily net asset
value of the Portfolio's outstanding Investor B Shares. Payments
under the Plan are not tied directly to out-of-pocket expenses
and therefore may be used by the recipients as they choose (for
example, to defray their overhead expenses).

Under the Plan, the Fund intends to enter into service agree-
ments with Service Organizations (including PNC Bank and its af-
filiates) with respect to each class of Investor Shares pursuant
to which Service Organizations will render certain support serv-
ices to their customers who are the beneficial owners of In-
vestor Shares. In consideration for a shareholder servicing fee
of up to .25% (annualized) of the average daily net asset value
of Investor Shares owned by their customers, Service Organiza-
tions may provide one or more of the following services: re-
sponding to customer inquiries relating to the services per-
formed by the Service Organization and to customer inquiries
concerning their investments in Investor Shares; providing in-
formation periodically to customers showing their positions in
Investor Shares; and other similar shareholder liaison services.
In consideration for a separate shareholder processing fee of up
to .15% (annualized) of the average daily net asset value of In-
vestor Shares owned by their customers, Service Organizations
may provide one or more of these additional services to such
customers: processing purchase and redemption requests from
customers and placing orders with the Fund's transfer agent or
the Distributor; processing dividend payments from the Fund on
behalf of

23
<PAGE>

customers; providing sub-accounting with respect to Investor
Shares beneficially owned by customers or the information
necessary for sub-accounting; and other similar services.

Service Organizations may charge their clients additional
fees for account services. Customers who are beneficial own-
ers of Investor Shares should read this Prospectus in light
of the terms and fees governing their accounts with Service
Organizations.

The Glass-Steagall Act and other applicable laws, among other
things, prohibit banks from engaging in the business of un-
derwriting securities. It is intended that the services pro-
vided by Service Organizations under their service agreements
will not be prohibited under these laws. However, state secu-
rities laws may differ from the interpretations of Federal
law on this issue, and banks and financial institutions may
be required to register as dealers pursuant to state law.

EXPENSES Expenses are deducted from the total income of the Portfolio
before dividends and distributions are paid. Expenses in-
clude, but are not limited to, fees paid to PAMG and the Ad-
ministrators, transfer agency and custodian fees, trustee
fees, taxes, interest, professional fees, shareholder servic-
ing and processing fees, fees and expenses in registering and
qualifying the Portfolio and its shares for distribution un-
der Federal and state securities laws, expenses of preparing
prospectuses and statements of additional information and of
printing and distributing prospectuses and statements of ad-
ditional information to existing shareholders, expenses re-
lating to shareholder reports, shareholder meetings and proxy
solicitations, insurance premiums, the expense of independent
pricing services, and other expenses which are not expressly
assumed by PAMG or the Fund's service providers under their
agreements with the Fund. Any general expenses of the Fund
that do not belong to a particular investment portfolio will
be allocated among all investment portfolios by or under the
direction of the Board of Trustees in a manner the Board de-
termines to be fair and equitable.

24
<PAGE>

What Pricing Options Are Available To Investors?
- --------------------------------------------------------------------------------
The Portfolio offers different pricing options to investors in
the form of different share classes. These options are described
below:

A SHARES (FRONT-END LOAD)
One time, front-end sales charge at time of purchase
No charges or fees at any time for redeeming shares
Lower ongoing expenses
Free exchanges with other A Shares in the Compass Capital Funds
family

A Shares may make sense for investors with a long-term invest-
ment horizon who prefer to pay a one-time front-end sales charge
and have reduced ongoing fees.

B SHARES (BACK-END LOAD)
No front-end sales charge at time of purchase
Contingent deferred sales charge (CDSC) if shares are redeemed,
declining over 6 years from a high of 4.50%
Automatically convert to A Shares seven years from purchase

B Shares may make sense for investors who prefer to pay for pro-
fessional investment advice on an ongoing basis (asset-based
sales charge) rather than with a traditional, one-time front-end
sales charge.

25
<PAGE>

THE PRICING OPTIONS FOR THE PORTFOLIO ARE DESCRIBED IN THE TABLE BELOW:

<TABLE>
<CAPTION>
A SHARES B SHARES
<S> <C> <C>
Maximum Front-End Sales Charge 4.00% 0.00%
12b-1 Fee 0.00%* 0.75%
CDSC (Redemption Charge) 0.00% 4.50%-0.00%
(Depends on when
shares are redeemed)
</TABLE>

*The Portfolio does not expect to incur any 12b-1 fees with respect to Investor
A Shares during the current fiscal year.

Investors wishing to purchase shares of the Portfolio may do so either by mail-
ing the investment application attached to this Prospectus along with a check
or by wiring money as specified below under "How Are Shares Purchased?"

26
<PAGE>

What Are The Key Considerations In Selecting A Pricing Option?
- --------------------------------------------------------------------------------
In deciding which class of Investor Shares to purchase, investors should con-
sider the following:

Intended Holding Period. Over time, the cumulative distribution fees on the
Portfolio's Investor B Shares will exceed the expense of the maximum initial
sales charge on Investor A Shares. For example, if net asset value remains con-
stant, the Investor B Shares' aggregate distribution fees would be equal to the
Investor A Shares' initial maximum sales charge approximately five years after
purchase. Thereafter, Investor B Shares would bear higher aggregate expenses.
Investor B shareholders, however, enjoy the benefit of permitting all their
dollars to work from the time the investments are made. Any positive investment
return on the additional invested amount would partially or wholly offset the
higher annual expenses borne by Investor B Shares.

Because the Portfolio's future returns cannot be predicted, however, there can
be no assurance that such a positive return will be achieved.

At the end of seven years after the date of purchase, Investor B Shares will
convert automatically to Investor A Shares, based on the relative net asset
values of shares of each class. Investor B Shares acquired through reinvestment
of dividends or distributions are also converted at the earlier of these
dates--seven years after the reinvestment date or the date of conversion of the
most recently purchased Investor B Shares that were not acquired through rein-
vestment.

Investor B Shares of the Portfolio purchased on or before January 12, 1996 are
subject to a CDSC of 4.50% of the lesser of the original purchase price or the
net asset value of Investor B Shares at the time of redemption. This deferred
sales charge is reduced for shares held more than one year. Investor B Shares
of the Portfolio purchased on or before January 12, 1996 convert to Investor A
Shares of the Portfolio at the end of six years after purchase. For more infor-
mation about Investor B Shares purchased before January 12, 1996 and the de-
ferred sales charge payable on their redemption, call PFPC at (800) 441-7762.

Investor B shareholders also pay a contingent deferred sales charge if they re-
deem during the first six years after purchase, unless a sales charge waiver
applies. Investors expecting to redeem during this period should consider the
cost of the applicable contingent deferred sales charge in addition to the ag-
gregate annual Investor B distribution fees, as compared with the cost of the
applicable initial sales charges applicable to the Investor A Shares.

Reduced Sales Charges. Because of reductions in the front-end sales charge for
purchases of Investor A Shares aggregating $25,000 or more, it may be advanta-
geous for investors purchasing large quantities of Investor Shares to purchase
Investor A Shares. In any event, the Fund will not accept any purchase order
for $1,000,000 or more of Investor B Shares.

Waiver of Sales Charges. The entire initial sales charge on Investor A Shares
of the Portfolio may be waived for certain eligible purchasers allowing their
entire purchase price to be immediately invested in the Portfolio. The contin-
gent deferred sales charge may be waived upon redemption of certain Investor B
Shares.

27
<PAGE>

How Are Shares Purchased?
- -------------------------------------------------------------------------------
GENERAL. Initial and subsequent purchase orders may be placed through securi-
ties brokers, dealers or financial institutions ("brokers"), or the transfer
agent. Generally, individual investors will purchase Investor Shares through a
broker who will then transmit the purchase order directly to the transfer
agent.

The minimum investment for the initial purchase of shares is $500; there is a
$100 minimum for subsequent investments. Purchases through the Automatic In-
vestment Plan described below are subject to a lower initial purchase minimum.
In addition, the minimum initial investment for employees of the Fund, the
Fund's investment adviser, sub-advisers, Distributor or transfer agent or em-
ployees of their affiliates is $100.

When placing purchase orders, investors should specify whether the order is
for Investor A or Investor B Shares of the Portfolio. All share purchase or-
ders that fail to specify a class will automatically be invested in Investor A
Shares.

PURCHASES THROUGH BROKERS. Shares of the Portfolio may be purchased through
brokers which have entered into dealer agreements with the Distributor. Pur-
chase orders received by a broker and transmitted to the transfer agent before
the close of regular trading on the New York Stock Exchange (currently 4:00
p.m. Eastern time) on a Business Day will be effected at the net asset value
determined that day, plus any applicable sales charge. Payment for an order
may be made by the broker in Federal funds or other funds immediately avail-
able to the Portfolio's custodian no later than 4:00 p.m. (Eastern time) on
the third Business Day following receipt of the purchase order.

It is the responsibility of brokers to transmit purchase orders and payment on
a timely basis. If payment is not received within the period described above,
the order will be canceled, notice thereof will be given, and the broker and
its customers will be responsible for any loss to the Fund or its sharehold-
ers. Orders of less than $500 may be mailed by a broker to the transfer agent.

PURCHASES THROUGH THE TRANSFER AGENT. Investors may also purchase Investor
Shares by completing and signing the Account Application Form and mailing it
to the transfer agent, together with a check in at least the minimum initial
purchase amount payable to Compass Capital Funds. An Account Application Form
may be obtained by calling (800) 441-7762. The name of the Portfolio must also
appear on the check or Federal Reserve Draft. Investors may also wire Federal
funds in connection with the purchase of shares. The wire instructions must
include the name of the Portfolio, specify the class of Investor Shares, and
include the name of the account registration and the shareholder account num-
ber. Before wiring any funds, an investor must call PFPC at (800) 441-7762 in
order to confirm the wire instructions. Purchase orders which are received by
PFPC, together with payment, before the close of regular trading hours on the
New York Stock Exchange (currently 4:00 p.m. Eastern time) on any Business Day
(as defined below) are priced at the applicable net asset value next deter-
mined on that day, plus any applicable sales charge.

28
<PAGE>

OTHER PURCHASE INFORMATION. Shares of the Portfolio are sold on a continuous
basis by CDI as the Distributor. CDI maintains its principal offices at 259
Radnor-Chester Road, Suite 120, Radnor, Pennsylvania 19087. Purchases may be
effected on weekdays on which both the New York Stock Exchange and the Federal
Reserve Bank of Philadelphia are open for business (a "Business Day"). Payment
for orders which are not received or accepted will be returned after prompt in-
quiry. The issuance of shares is recorded on the books of the Fund. No certifi-
cates will be issued for shares. Payments for shares of the Portfolio may, in
the discretion of the Fund's investment adviser, be made in the form of securi-
ties that are permissible investments for the Portfolio. Compass Capital re-
serves the right to reject any purchase order or to waive the minimum initial
investment requirement.

29
<PAGE>

How Are Shares Redeemed?
- -------------------------------------------------------------------------------
REDEMPTION. Shareholders may redeem their shares for cash at any time. A writ-
ten redemption request in proper form must be sent directly to Compass Capital
Funds c/o PFPC, P.O. Box 8907, Wilmington, Delaware 19899-8907. Except for the
contingent deferred sales charge that may be charged with respect to Investor
B Shares, there is no charge for a redemption. Shareholders may also place re-
demption requests through a broker or other institution, which may charge a
fee for this service.

WHEN REDEEMING INVESTOR SHARES IN THE PORTFOLIO, SHAREHOLDERS SHOULD INDICATE
WHETHER THEY ARE REDEEMING INVESTOR A SHARES OR INVESTOR B SHARE. If a redeem-
ing shareholder owns both Investor A Shares and Investor B Shares in the Port-
folio, the Investor A Shares will be redeemed first unless the shareholder in-
dicates otherwise.

Except as noted below, a request for redemption must be signed by all persons
in whose names the shares are registered. Signatures must conform exactly to
the account registration. If the proceeds of the redemption would exceed
$25,000, or if the proceeds are not to be paid to the record owner at the rec-
ord address, or if the shareholder is a corporation, partnership, trust or fi-
duciary, signature(s) must be guaranteed by any eligible guarantor institu-
tion. Eligible guarantor institutions generally include banks, broker/dealers,
credit unions, national securities exchanges, registered securities associa-
tions, clearing agencies and savings associations.

Generally, a properly signed written request with any required signature guar-
antee is all that is required for a redemption. In some cases, however, other
documents may be necessary. Shareholders holding Investor A Share certificates
must send their certificates with the redemption request. Additional documen-
tary evidence of authority is required by PFPC in the event redemption is re-
quested by a corporation, partnership, trust, fiduciary, executor or adminis-
trator.

EXPEDITED REDEMPTIONS. If a shareholder has given authorization for expedited
redemption, shares can be redeemed by telephone and the proceeds sent by check
to the shareholder or by Federal wire transfer to a single previously desig-
nated bank account. Once authorization is on file, PFPC will honor requests by
any person by telephone at (800) 441-7762 (in Delaware call collect (302) 791-
1194) or other means. The minimum amount that may be sent by check is $500,
while the minimum amount that may be wired is $10,000. The Fund reserves the
right to change these minimums or to terminate these redemption privileges. If
the proceeds of a redemption would exceed $25,000, the redemption request must
be in writing and will be subject to the signature guarantee requirement de-
scribed above. This privilege may not be used to redeem Investor A Shares in
certificated form. During periods of substantial economic or market change,
telephone redemptions may be difficult to complete. Redemption requests may
also be mailed to PFPC at P.O. Box 8907, Wilmington, Delaware 19899-8907.

The Fund is not responsible for the efficiency of the Federal wire system or
the shareholder's firm or bank. The Fund does not currently charge for wire
transfers. The shareholder is responsible for any charges imposed by the
shareholder's bank. To change the name of the single designated bank account
to receive wire redemption proceeds, it is necessary to send a written re-

30
<PAGE>

quest (with a guaranteed signature as described above) to Compass Capital Funds
c/o PFPC, P.O. Box 8907, Wilmington, Delaware 19899-8907.

The Fund reserves the right to refuse a telephone redemption if it believes it
advisable to do so. The Fund, the Administrators and the Distributor will em-
ploy reasonable procedures to confirm that instructions communicated by tele-
phone are genuine. The Fund, the Administrators and the Distributor will not be
liable for any loss, liability, cost or expense for acting upon telephone in-
structions reasonably believed to be genuine in accordance with such proce-
dures.

ACCOUNTS WITH LOW BALANCES. The Fund reserves the right to redeem a sharehold-
er's account in the Portfolio at any time the net asset value of such account
falls below the minimum initial investment requirement amount as the result of
a redemption or an exchange request. A shareholder will be notified in writing
that the value of the shareholder's account in the Portfolio is less than the
required amount and will be allowed 30 days to make additional investments be-
fore the redemption is processed.

PAYMENT OF REDEMPTION PROCEEDS. The redemption price for shares is their net
asset value per share next determined after the request for redemption is re-
ceived in proper form by the Compass Capital Funds c/o PFPC, P.O. Box 8907,
Wilmington, Delaware 19899-8907. Proceeds from the redemption of Investor B
Shares will be reduced by the amount of any applicable contingent deferred
sales charge. Unless another payment option is used as described above, payment
for redeemed shares is normally made by check mailed within seven days after
acceptance by PFPC of the request and any other necessary documents in proper
order. Payment may, however, be postponed or the right of redemption suspended
as provided by the rules of the SEC. If the shares to be redeemed have been re-
cently purchased by check, the Fund's transfer agent may delay the payment of
redemption proceeds, which may be a period of up to 15 days after the purchase
date, pending a determination that the check has cleared.

The Fund may also suspend the right of redemption or postpone the date of pay-
ment upon redemption for such periods as are permitted under the 1940 Act, and
may redeem shares involuntarily or make payment for redemption in securities or
other property when determined appropriate in light of the Fund's responsibili-
ties under the 1940 Act. See "Purchase and Redemption Information" in the
Statement of Additional Information for examples of when such redemption might
be appropriate.

31
<PAGE>

What Are The Shareholder Features Of The Fund?
- --------------------------------------------------------------------------------
Compass Capital Funds offers shareholders many special features which enable an
investor to have greater investment flexibility as well as greater access to
information about the Fund throughout the investment period.

Additional information on each of these features is available from PFPC by
calling (800) 441-7762 (in Delaware call collect (302) 791-1194).

EXCHANGE PRIVILEGE. Investor A and Investor B Shares of the Portfolio may be
exchanged for shares of the same class of other portfolios of the Fund which
offer that class of shares, based on their respective net asset values. Ex-
changes of Investor A Shares may be subject to the difference between the sales
charge previously paid on the exchanged shares and the higher sales charge (if
any) payable with respect to the shares acquired in the exchange.

Investor A Shares of money market portfolios of the Fund that were (1) acquired
through the use of the exchange privilege and (2) can be traced back to a pur-
chase of shares in one or more investment portfolios of the Fund for which a
sales charge was paid, can be exchanged for Investor A Shares of the Portfolio
subject to differential sales charges as applicable.

The exchange of Investor B Shares will not be subject to a CDSC, which will
continue to be measured from the date of the original purchase and will not be
affected by exchanges.

A shareholder wishing to make an exchange may do so by sending a written re-
quest to PFPC at the address given above. Shareholders are automatically pro-
vided with telephone exchange privileges when opening an account, unless they
indicate on the Application that they do not wish to use this privilege. Share-
holders holding share certificates are not eligible to exchange Investor A
Shares by phone because share certificates must accompany all exchange re-
quests. To add this feature to an existing account that previously did not pro-
vide for this option, a Telephone Exchange Authorization Form must be filed
with PFPC. This form is available from PFPC. Once this election has been made,
the shareholder may simply contact PFPC by telephone at (800) 441-7762 (in Del-
aware call collect (302) 791-1194) to request the exchange. During periods of
substantial economic or market change, telephone exchanges may be difficult to
complete and shareholders may have to submit exchange requests to PFPC in writ-
ing.

If the exchanging shareholder does not currently own shares of the investment
portfolio whose shares are being acquired, a new account will be established
with the same registration, dividend and capital gain options and broker of
record as the account from which shares are exchanged, unless otherwise speci-
fied in writing by the shareholder with all signatures guaranteed by an eligi-
ble guarantor institution as defined above. In order to participate in the Au-
tomatic Investment Program or establish a Systematic Withdrawal Plan for the
new account, however, an exchanging shareholder must file a specific written
request.

Any share exchange must satisfy the requirements relating to the minimum ini-
tial investment requirement, and must be legally available for sale in the
state of the investor's residence. For

32
<PAGE>

Federal income tax purposes, a share exchange is a taxable event and, accord-
ingly, a capital gain or loss may be realized. Before making an exchange re-
quest, shareholders should consult a tax or other financial adviser and should
consider the investment objective, policies and restrictions of the investment
portfolio into which the shareholder is making an exchange, as set forth in the
applicable Prospectus. Brokers may charge a fee for handling exchanges.

The Fund reserves the right to modify or terminate the exchange privilege at
any time. Notice will be given to shareholders of any material modification or
termination except where notice is not required.

The Fund reserves the right to reject any telephone exchange request. Telephone
exchanges may be subject to limitations as to amount or frequency, and to other
restrictions that may be established from time to time to ensure that exchanges
do not operate to the disadvantage of any portfolio or its shareholders. The
Fund, the Administrators and the Distributor will employ reasonable procedures
to confirm that instructions communicated by telephone are genuine. The Fund,
the Administrators and the Distributor will not be liable for any loss, liabil-
ity, cost or expense for acting upon telephone instructions reasonably believed
to be genuine in accordance with such procedures. Exchange orders may also be
sent by mail to the shareholder's broker or to PFPC at P.O. Box 8907, Wilming-
ton, Delaware 19899-8907.

AUTOMATIC INVESTMENT PLAN ("AIP"). An investor in shares of the Portfolio may
arrange for periodic investments in the Portfolio through automatic deductions
from a checking or savings account by completing the AIP Application Form which
may be obtained from PFPC. The minimum pre-authorized investment amount is $50.

RETIREMENT PLANS. Portfolio shares may be purchased in conjunction with indi-
vidual retirement accounts ("IRAs") and rollover IRAs where PNC Bank or any of
its affiliates acts as custodian. For further information as to applications
and annual fees, contact the Distributor. To determine whether the benefits of
an IRA are available and/or appropriate, a shareholder should consult with a
tax adviser.

SYSTEMATIC WITHDRAWAL PLAN ("SWP"). The Fund offers a Systematic Withdrawal
Plan which may be used by investors who wish to receive regular distributions
from their accounts. Upon commencement of the SWP, the account must have a cur-
rent value of $10,000 or more in the Portfolio. Shareholders may elect to re-
ceive automatic cash payments of $100 or more either monthly, every other
month, quarterly, three times a year, semi-annually, or annually. Automatic
withdrawals are normally processed on the 25th day of the applicable month or,
if such day is not a Business Day, on the next Business Day and are paid
promptly thereafter. An investor may utilize the SWP by completing the SWP Ap-
plication Form which may be obtained from PFPC.

Shareholders should realize that if withdrawals exceed income dividends their
invested principal in the account will be depleted. To participate in the SWP,
shareholders must have their dividends automatically reinvested and may not
hold share certificates. Shareholders may change or cancel the SWP at any time,
upon written notice to PFPC. Purchases of additional Investor A Shares of the
Fund concurrently with withdrawals may be disadvantageous to invest-

33
<PAGE>

ors because of the sales charges involved and, therefore, is discouraged. No
contingent deferred sales charge will be assessed on redemptions of Investor B
Shares made through the SWP that do not exceed 12% of an account's net asset
value on an annualized basis. For example, monthly, quarterly and semi-annual
SWP redemptions of Investor B Shares will not be subject to the CDSC if they do
not exceed 1%, 3% and 6%, respectively, of an account's net asset value on the
redemption date. SWP redemptions of Investor B Shares in excess of this limit
are still subject to the applicable CDSC.

34
<PAGE>

What Is The Schedule Of Sales Charges And Exemptions?
- --------------------------------------------------------------------------------
INVESTOR A Investor A Shares are subject to a front-end sales charge deter-
SHARES mined in accordance with the following schedule:

<TABLE>
<CAPTION>
REALLOWANCE
OR
SALES PLACEMENT
CHARGE AS SALES FEES
% CHARGE AS TO DEALERS
OF % (AS % OF
AMOUNT OF TRANSACTION OFFERING OF NET OFFERING
AT OFFERING PRICE PRICE ASSET VALUE PRICE)
<S> <C> <C> <C>
Less than $25,000 4.00% 4.17% 3.50%
$25,000 but less than $50,000 3.75 3.90 3.25
$50,000 but less than $100,000 3.50 3.63 3.00
$100,000 but less than $250,000 3.00 3.09 2.50
$250,000 but less than $500,000 2.00 2.04 1.50
$500,000 but less than $1,000,000 1.00 1.01 0.75
$1,000,000 and over 0.00* 0.00* 0.75**
</TABLE>

* There is no initial sales charge on the purchase of $1,000,000 or more of In-
vestor A Shares; however, a contingent deferred sales charge of 1.00% will be
imposed on the lesser of the net asset value of the shares on the purchase or
redemption date for shares redeemed within 18 months after purchase.
** The Distributor may pay placement fees to dealers of up to 0.75% of the of-
fering price on purchases of Investor A Shares of $1,000,000 or more.

35
<PAGE>

During special promotions, the entire sales charge may be reallowed to dealers.
In addition, certain dealers who enter into an agreement to provide extra
training and information on products, or marketing and related services, and
who increase sales of shares may also receive additional payments from the Dis-
tributor. Dealers who receive 90% or more of the sales charge may be deemed to
be "underwriters" under the 1933 Act. The amount of the sales charge not
reallowed to dealers may be paid to broker-dealer affiliates of PNC Bank Corp.
who provide sales support services.

SALES CHARGE WAIVERS--INVESTOR A SHARES. The following persons associated with
the Fund, the Distributor, the Fund's i nvestment adviser, sub-advisers or
transfer agent and their affiliates may buy Investor A Shares without paying a
sales charge to the extent permitted by these firms: (a) officers, directors
and partners (and their spouses and minor children); (b) full-time employees
and retirees (and their spouses and minor children); (c) registered representa-
tives of brokers who have entered into selling agreements with the Distributor;
(d) spouses or children of such persons; and (e) any trust, pension, profit-
sharing or other benefit plan for any of the persons set forth in (a) through
(c). The following persons may also buy Investor A Shares without paying a
sales charge: (a) persons investing through an authorized payroll deduction
plan; (b) persons investing through an authorized investment plan for organiza-
tions which operate under Section 501(c)(3) of the Internal Revenue Code; (c)
registered investment advisers, trust companies and bank trust departments ex-
ercising discretionary investment authority with respect to amounts to be in-
vested in the Portfolio, provided that the aggregate amount invested pursuant
to this exemption equals at least $250,000; and (d) persons participating in a
"wrap account" or similar program under which they pay advisory fees to a bro-
ker-dealer or other financial institution. INVESTORS WHO QUALIFY FOR ANY OF
THESE EXEMPTIONS FROM THE SALES CHARGE MUST PURCHASE INVESTOR A SHARES.

QUALIFIED PLANS. The sales charge (as a percentage of the offering price) pay-
able by qualified employee benefit plans ("Qualified Plans") having at least 20
employees eligible to participate on purchases of Investor A Shares of the
Portfolio aggregating less than $500,000 will be 1.00%. No sales charge will
apply to purchases by Qualified Plans of Investor A Shares aggregating $500,000
and above. The sales charge payable by Qualified Plans having less than 20 em-
ployees eligible to participate on purchases of Investor A Shares of the Port-
folio aggregating less than $500,000 will be 2.50%. The above schedules will
apply to purchases by such Qualified Plans of Investor A Shares aggregating
$500,000 and above.

QUANTITY DISCOUNTS. As shown above, larger purchases may reduce the sales
charge price. Upon notice to the investor's broker or the transfer agent, pur-
chases of Investor A Shares made at any one time by the following persons may
be considered when calculating the sales charge: (a) an individual, his or her
spouse, and their children under the age of 21; (b) a trustee or fiduciary of a
single trust estate or single fiduciary account; or (c) any organized group
which has been in existence for more than six months, if it is not organized
for the purpose of buying redeemable securities of a registered investment com-
pany, and if the purchase is made through a central administrator, or through a
single dealer, or by other means which result in economy of sales effort or ex-
pense. An organized group does not include a group of

36
<PAGE>

individuals whose sole organizational connection is participation as credit
card holders of a company, policyholders of an insurance company, customers of
either a bank or broker/dealer or clients of an investment adviser. Purchases
made by an organized group may include, for example, a trustee or other fidu-
ciary purchasing for a single fiduciary account or other employee benefit plan
purchases made through a payroll deduction plan.

REDUCED SALES CHARGES--INVESTOR A SHARES

RIGHT OF ACCUMULATION. Under the Right of Accumulation, the current value of an
investor's existing Investor A Shares in the Portfolio that are subject to a
front-end sales charge may be combined with the amount of the investor's cur-
rent purchase in determining the applicable sales charge. IN ORDER TO RECEIVE
THE CUMULATIVE QUANTITY REDUCTION, PREVIOUS PURCHASES OF INVESTOR A SHARES MUST
BE CALLED TO THE ATTENTION OF PFPC BY THE INVESTOR AT THE TIME OF THE CURRENT
PURCHASE.

REINVESTMENT PRIVILEGE. Upon redemption of Investor A Shares of the Portfolio
(or Investor A Shares of another non-money market portfolio of the Fund), a
shareholder has a one-time right, to be exercised within 45 days, to reinvest
the redemption proceeds without any sales charges. PFPC must be notified of the
reinvestment in writing by the purchaser, or by his or her broker, at the time
the purchase is made in order to eliminate a sales charge. An investor should
consult a tax adviser concerning the tax consequences of use of the reinvest-
ment privilege.

INVESTMENTS OF REDEMPTION PROCEEDS FROM OTHER INVESTMENT COMPANIES. Investors
may purchase Investor A Shares at net asset value, without a sales charge, with
the proceeds from the redemption of shares of any other investment company
which were sold with a sales charge or commission. This does not include shares
of an affiliated mutual fund which were or would be subject to a contingent de-
ferred sales charge upon redemption. Such purchases must be made within 60 days
of the redemption, and the Fund must be notified by the investor in writing, or
by his or her financial institution, at the time the purchase of Investor A
Shares is made.

LETTER OF INTENT. An investor may qualify for a reduced sales charge immedi-
ately by signing a non-binding Letter of Intent stating the investor's inten-
tion to invest during the next 13 months a specified amount in Investor A
Shares which, if made at one time, would qualify for a reduced sales charge.
The Letter of Intent may be signed at any time within 90 days after the first
investment to be included in the Letter of Intent. The initial investment must
meet the minimum initial investment requirement and represent at least 5% of
the total intended investment. THE INVESTOR MUST INSTRUCT PFPC UPON MAKING SUB-
SEQUENT PURCHASES THAT SUCH PURCHASES ARE SUBJECT TO A LETTER OF INTENT. All
dividends and capital gains of the Portfolio that are invested in additional
Investor A Shares of the Portfolio are applied to the Letter of Intent.

During the term of a Letter of Intent, the Fund's transfer agent will hold In-
vestor A Shares representing 5% of the indicated amount in escrow for payment
of a higher sales load if the full amount indicated in the Letter of Intent is
not purchased. The escrowed Investor A Shares will

37
<PAGE>

be released when the full amount indicated has been purchased. Any redemptions
made during the 13-month period will be subtracted from the amount of purchases
in determining whether the Letter of Intent has been completed.

If the full amount indicated is not purchased within the 13-month period, the
investor will be required to pay an amount equal to the difference between the
sales charge actually paid and the sales charge the investor would have had to
pay on his or her aggregate purchases if the total of such purchases had been
made at a single time. If remittance is not received within 20 days of the ex-
piration of the 13-month period, PFPC, as attorney-in-fact, pursuant to the
terms of the Letter of Intent, will redeem an appropriate number of Investor A
Shares held in escrow to realize the difference.

PURCHASES OF INVESTOR B SHARES. Investor B Shares are subject to a deferred
sales charge at the rates set forth in the chart below if they are redeemed
within six years of purchase. The deferred sales charge on Investor B Shares is
based on the lesser of the net asset value of the Investor B Shares on the pur-
chase date or redemption date. Brokers will receive commissions from the Dis-
tributor in connection with sales of Investor B Shares. These commissions may
be different than the reallowances or placement fees paid to dealers in connec-
tion with sales of Investor A Shares.

The amount of any contingent deferred sales charge an investor must pay on In-
vestor B Shares depends on the number of years that elapse between the purchase
date and the date the Investor B Shares are redeemed as set forth in the fol-
lowing chart:

<TABLE>
<CAPTION>
CONTINGENT DEFERRED
SALES CHARGE (AS A
NUMBER OF YEARS PERCENTAGE OF DOLLAR AMOUNT
ELAPSED SINCE PURCHASE SUBJECT TO THE CHARGE)
<S> <C>
Less than one 4.50%
More than one, but less than two 4.00
More than two, but less than three 3.50
More than three, but less than four 3.00
More than four, but less than five 2.00
More than five, but less than six 1.00
More than six, but less than seven 0.00
</TABLE>

EXEMPTIONS FROM THE CONTINGENT DEFERRED SALES CHARGE. The contingent deferred
sales charge on Investor B Shares is not charged in connection with: (1) ex-
changes described in "What Are the Shareholder Features of the Fund?--Exchange
Privilege"; (2) redemptions made in connection with minimum required distribu-
tions from IRA, 403(b)(7) and Qualified Plan accounts due to the shareholder
reaching age 70 1/2; (3) redemptions in connection with a shareholder's death
or disability (as defined in the Internal Revenue Code) subsequent to the pur-
chase of Investor B Shares; (4) involuntary redemptions of Investor B Shares in
accounts with low balances as described in "How Are Shares Redeemed?"; and (5)
redemptions made pursuant to the Systematic Withdrawal Plan, subject to the
limitations set forth above under "What Are the Shareholder Features of the
Fund?--Systematic Withdrawal Plan." In addition, no con-

38
<PAGE>

tingent deferred sales charge is charged on Investor B Shares acquired through
the reinvestment of dividends or distributions.

When an investor redeems Investor B Shares, the redemption order is processed
to minimize the amount of the contingent deferred sales charge that will be
charged. Investor B Shares are redeemed first from those shares that are not
subject to the deferred sales load (i.e., shares that were acquired through re-
investment of dividends or distributions) and after that from the shares that
have been held the longest.

39
<PAGE>

How Is Net Asset Value Calculated?
- --------------------------------------------------------------------------------
The net asset value is calculated separately for each class of Investor Shares
of the Portfolio as of the close of regular trading hours on the NYSE (cur-
rently 4:00 p.m. Eastern Time) on each Business Day by dividing the value of
all securities and other assets owned by the Portfolio that are allocated to a
particular class of shares, less the liabilities charged to that class, by the
number of shares of the class that are outstanding.

Most securities held by the Portfolio are priced based on their market value as
determined by reported sales prices or the mean between their bid and asked
prices. Securities for which market quotations are not readily available are
valued at fair market value as determined in good faith by or under the direc-
tion of the Board of Trustees. The amortized cost method of valuation will also
be used with respect to debt obligations with sixty days or less remaining to
maturity unless the Portfolio's sub-adviser under the supervision of the Board
of Trustees determines such method does not represent fair value.

40
<PAGE>

How Frequently Are Dividends And Distributions Made To Investors?
- --------------------------------------------------------------------------------
The Portfolio will distribute substantially all of its net investment income
and net realized capital gains, if any, to shareholders. All distributions are
reinvested at net asset value in the form of additional full and fractional
shares of the same class of shares of the Portfolio unless a shareholder elects
otherwise. Such election, or any revocation thereof, must be made in writing to
PFPC, and will become effective with respect to dividends paid after its re-
ceipt by PFPC.
The Portfolio will declare a dividend each day on "settled" shares (i.e. shares
for which the Portfolio has received payment in Federal funds) on the first
Business Day after a purchase order is placed with the Fund. Payments by check
are normally converted to Federal funds within two Business Days of receipt.
Over the course of a year, substantially all of the Portfolio's net investment
income will be declared as dividends. The amount of the daily dividend for the
Portfolio will be based on periodic projections of its net investment income.
All dividends are paid within ten days after the end of each month.

41
<PAGE>

How Are Fund Distributions Taxed?
- --------------------------------------------------------------------------------
The Portfolio intends to qualify as a regulated investment company under
Subchapter M of the Internal Revenue Code of 1986, as amended. If the Portfolio
qualifies, it generally will be relieved of Federal income tax on amounts dis-
tributed to shareholders, but shareholders, unless otherwise exempt, will pay
income or capital gains taxes on distributions (except distributions that are
"exempt interest dividends" or are treated as a return of capital), regardless
of whether the distributions are paid in cash or reinvested in additional
Shares.

Distributions paid out of the Portfolio's "net capital gain" (the excess of net
long-term capital gain over net short-term capital loss), if any, will be taxed
to shareholders as long-term capital gain, regardless of the length of time a
shareholder holds the Shares. All other distributions, to the extent taxable,
are taxed to shareholders as ordinary income.

Compass Capital will send written notices to shareholders annually regarding
the tax status of distributions made by the Portfolio. Dividends declared in
October, November or December of any year payable to shareholders of record on
a specified date in those months will be deemed to have been received by the
shareholders on December 31 of such year, if the dividends are paid during the
following January.

An investor considering buying Shares on or just before a dividend record date
should be aware that the amount of the forthcoming dividend payment, although
in effect a return of capital, will be taxable.

A taxable gain or loss may be realized by a shareholder upon the redemption or
transfer of Shares depending upon their tax basis and their price at the time
of redemption, or transfer. Generally, shareholders may include sales charges
paid on the purchase of Shares in their tax basis for the purposes of determin-
ing gain or loss on a redemption, transfer or exchange of such Shares. However,
if a shareholder exchanges the Shares for Shares of another portfolio within 90
days of purchase and is able to reduce the sales charges applicable to the new
Shares (by virtue of the Fund's exchange privilege), the amount equal to such
reduction may not be included in the tax basis of the shareholder's exchanged
Shares for the purpose of determining gain or loss but may be included (subject
to the same limitation) in the tax basis of the new Shares.

Any loss upon the sale or exchange of Shares held for six months or less will
be disallowed for Federal income tax purposes to the extent of any exempt in-
terest dividends received by the shareholder.

This is not an exhaustive discussion of applicable tax consequences, and in-
vestors may wish to contact their tax advisers concerning an investment in the
Portfolio. Dividends paid by the Portfolio may be taxable to investors under
state or local law as dividend income even though all or a portion of the divi-
dends may be derived from interest on obligations which, if realized directly,
would be exempt from such income taxes. In addition, future legislative or
administra-

42
<PAGE>

tive changes or court decisions may materially affect the tax consequences of
investing in the Portfolio. Shareholders who are non-resident alien individu-
als, foreign trusts or estates, foreign corporations or foreign partnerships
may be subject to different U.S. Federal income tax treatment.

43
<PAGE>

How Is The Fund Organized?
- --------------------------------------------------------------------------------
The Fund was organized as a Massachusetts business trust on December 22, 1988
and is registered under the 1940 Act as an open-end management investment com-
pany. On January 12, 1996 the Fund changed its name from The PNC(R) Fund to
Compass Capital Funds. The Declaration of Trust authorizes the Board of Trust-
ees to classify and reclassify any unissued shares into one or more classes of
shares. Pursuant to this authority, the Trustees have authorized the issuance
of an unlimited number of shares in twenty-eight investment portfolios. The
Portfolio offers five separate classes of shares--Institutional Shares, Service
Shares, Investor A Shares, Investor B Shares and Investor C Shares. This pro-
spectus relates only to Investor A Shares and Investor B Shares of the Portfo-
lio.

Shares of each class bear their pro rata portion of all operating expenses paid
by the Portfolio, except transfer agency fees and amounts payable under the
Fund's Distribution and Service Plan. In addition, each class of Investor
Shares is sold with different sales charges. Because of these "class expenses"
and sales charges, the performance of the Portfolio's Institutional Shares is
expected to be higher than the performance of the Portfolio's Service Shares,
and the performance of both the Institutional Shares and Service Shares of the
Portfolio is expected to be higher than the performance of the Portfolio's two
classes of Investor Shares. The Fund offers various services and privileges in
connection with its Investor Shares that are not generally offered in connec-
tion with its Institutional and Service Shares, including an automatic invest-
ment plan, automatic withdrawal plan and checkwriting. For further information
regarding the Fund's Institutional and Service Share classes, contact PFPC at
(800) 441-7764.

Each share of the Portfolio has a par value of $.001, represents an interest in
the Portfolio and is entitled to the dividends and distributions earned on the
Portfolio's assets as are declared in the discretion of the Board of Trustees.
The Fund's shareholders are entitled to one vote for each full share held and
proportionate fractional votes for fractional shares held, and will vote in the
aggregate and not by class, except where otherwise required by law or as deter-
mined by the Board of Trustees. The Fund does not currently intend to hold an-
nual meetings of shareholders for the election of trustees (except as required
under the 1940 Act). For a further discussion of the voting rights of share-
holders, see "Additional Information Concerning Shares" in the Statement of Ad-
ditional Information.

On December 18, 1995, PNC Bank held of record approximately 77% of the Fund's
outstanding shares, as trustee on behalf of individual and institutional in-
vestors, and may be deemed a controlling person of the Fund under the 1940 Act.
PNC Bank is a subsidiary of PNC Bank Corp., a multi-bank holding company.

44
<PAGE>

How Is Performance Calculated?
- --------------------------------------------------------------------------------
Performance information for each class of Investor Shares of the Portfolio may
be quoted in advertisements and communications to shareholders. Total return
will be calculated on an average annual total return basis for various periods.
Average annual total return reflects the average annual percentage change in
value of an investment in Investor Shares of the Portfolio over the measuring
period. Total return may also be calculated on an aggregate total return basis.
Aggregate total return reflects the total percentage change in value over the
measuring period. Both methods of calculating total return assume that dividend
and capital gain distributions made by the Portfolio with respect to a class of
shares are reinvested in shares of the same class, and also reflect the maximum
sales load charged by the Portfolio with respect to a class of shares. When,
however, the Portfolio compares the total return of a share class to that of
other funds or relevant indices, total return may also be computed without re-
flecting the sales load.

The yield of a class of shares is computed by dividing the Portfolio's net in-
come per share allocated to that class during a 30-day (or one month) period by
the maximum offering price per share on the last day of the period and
annualizing the result on a semi-annual basis.

The performance of a class of the Portfolio's Investor Shares may be compared
to the performance of other mutual funds with similar investment objectives and
to relevant indices, as well as to ratings or rankings prepared by independent
services or other financial or industry publications that monitor the perfor-
mance of mutual funds. For example, the performance of a class of the Portfo-
lio's Investor Shares may be compared to data prepared by Lipper Analytical
Services, Inc., CDA Investment Technologies, Inc. and Weisenberger Investment
Company Service, and with the performance of the Lehman GMNA Index, the T-Bill
Index and the "stocks, bonds and inflation index" published annually by
Ibbotson Associates and the Lehman Government Corporate Bond Index, as well as
the benchmark attached to this Prospectus. Performance information may also in-
clude evaluations of the Portfolio and its share classes published by nation-
ally recognized ranking services, and information as reported in financial pub-
lications such as Business Week, Fortune, Institutional Investor, Money Maga-
zine, Forbes, Barron's, The Wall Street Journal and The New York Times, or in
publications of a local or regional nature.

In addition to providing performance information that demonstrates the actual
yield or return of a class of shares of the Portfolio, the Portfolio may pro-
vide other information demonstrating hypothetical investment returns. This in-
formation may include, but is not limited to, illustrating the compounding ef-
fects of a dividend in a dividend reinvestment plan or the impact of tax-de-
ferred investing.

Performance quotations for shares of the Portfolio represent past performance
and should not be considered representative of future results. The investment
return and principal value of an investment in the Portfolio will fluctuate so
that an investor's Investor Shares, when redeemed, may be worth more or less
than their original cost. Since performance will fluctuate, perfor-

45
<PAGE>

mance data for Investor Shares of the Portfolio cannot necessarily be used to
compare an investment in such shares with bank deposits, savings accounts and
similar investment alternatives which often provide an agreed or guaranteed
fixed yield for a stated period of time. Performance is generally a function of
the kind and quality of the instruments held in the Portfolio, portfolio matu-
rity, operating expenses and market conditions. Any fees charged by brokers or
other institutions directly to their customer accounts in connection with in-
vestments in Investor Shares will not be included in the Portfolio's perfor-
mance calculations.

46
<PAGE>

How Can I Get More Information?
- --------------------------------------------------------------------------------
We believe that it is essential for shareholders to have access to information
regarding their investment 24 hours a day, 7 days a week. The COMPASS CAPITAL
FUNDS have an investor information line that can provide such access.

In addition to account information, other sources of information regarding each
COMPASS CAPITAL Portfolio and its portfolio holdings, strategy and current div-
idend and performance levels are available.

By selecting the appropriate source of information as listed below, investors
can receive additional information on the COMPASS CAPITAL Portfolios by either
using a toll-free number or through electronic access:

For Performance and Portfolio Management Questions dial (888) 4COMPASS.

For Information Related to Share Purchases and Redemptions call your investment
adviser or COMPASS CAPITAL FUNDS at (800) 441-7762.

For Questions about Shareholder Accounts and Balances held directly at the
Fund, call (800) 441-7762.

Information is also available on the Internet through the World Wide Web.
Shareholders and investment professionals may access portfolio information,
portfolio manager updates and market data by accessing
http://www.compassfunds.com.

47
<PAGE>

APPENDIX

<TABLE>
<CAPTION>
CORE BOND
PORTFOLIO
PERFORMANCE
BENCHMARK DESCRIPTION

<S> <C>
Lehman Aggregate The Lehman Aggregate contains issues that meet the following criteria:
. At least $100 million par amount outstanding for entry and exit
. Rated investment grade (at least Baa-3) by Moody's or S&P (if not rated by Moody's)
. At least one year at maturity
. Coupon must have a fixed rate
. Excludes CMOs, ARMs, manufactured homes, non-agency bonds, buydowns, graduated equity mortgages,
project loans and non-conforming ("jumbo") mortgages
. As of June 1995, the composition of the Lehman Brothers Aggregate Index is:
54% allocation to Treasury and government securities
28% allocation to mortgage-backed securities
18% allocation to corporate and asset-backed securities
</TABLE>

48
<PAGE>

COMPASS
- -------------------- Compass Capital Funds--New Account Application
[LOGO] CAPITAL FUNDS Mail completed application to:
PFPC--Attention: Compass Capital Funds, P.O. Box 8907, Wilmington, Delaware
19899-8907
<TABLE>
<S> <C>
1. Registration
Please Print
[ ] Individual
- -----------------------------------------------------------------------------------------------
Owner Social Security #/Tax Identification # [ ] Joint Tenant

- ----------------------------------------------------------------------------------------------- [ ] Custodian
Co-owner*, minor, trust Social Security #/Tax Identification #
[ ] UGMA (state)
- ----------------------------------------------------------------------------------------------- ----------
Street Address
[ ] Trust
- -----------------------------------------------------------------------------------------------
City State Zip Code [ ] Corporation

[ ] Other
- ----------------------------------------------------------------------------------------------- ----------------
Telephone # (Day) (Evening)

Citizen(s) of [ ] USA or [ ] other, please specify
-------------------------------------------------------------------
</TABLE>
*For joint registration, both must sign the application in Section 5. The
registration will be as joint tenants with the right of survivorship and not as
tenants in common, unless otherwise stated.

2. Investments

Enclosed is my check for $___________________ (minimum of $500
except the minimum is $100 for employees of the Fund, the Fund's adviser, sub-
advisers, distributor or transfer agent or employees of any such service
provider's affiliate) made payable to "Compass Capital Funds."

[ ] Core Bond Portfolio (379-005) $ [ ] Core Bond Portfolio (379-006) $
(Series A Shares) ---------- (Series B Shares) -----------

Series A Investor Shares are subject to a front-end sales charge and Series B Investor Shares are subject to a contingent deferred
sales charge.

</TABLE>

3. Options
A. Dividend Election

Unless you elect otherwise, all dividends and capital gains distributions
will be automatically reinvested in additional shares. If you prefer to be
paid in cash each month, check the appropriate box below.

Dividends: [ ] pay in cash [ ] reinvest
Capital Gains: [ ] pay in cash [ ] reinvest

If you elect to be paid in cash, you must check one of the boxes below. If
you do not check any box your distribution will be paid by check to the
address of record.

[ ] I request the above distributions be sent by check to the address of
record.
[ ] I request the above distributions be sent by check to the special payee
whose address is specified below:

<TABLE>
<S> <C>
Name of Bank or Individual Bank Account # (if applicable)
----------------------------------------------- -----------------------

Street Address City State Zip
------------------------------------- ------------------------------------ --------- ------------

</TABLE>

[ ] I request the above distributions to be sent electronically to my
financial institution as specified below:

<TABLE>
<S> <C>
Name on Bank Account Name of Bank
----------------------------------------------- -----------------------------------------------

Account # Type: [ ] Checking [ ] Savings

---------------------------------------------------------------------------------
Routing # (ABA#) Bank Address
------------------------------------- ----------------------------------------------------------

----------------------------------------------------------

</TABLE>

Please attach a voided check or savings deposit slip.

B. Wire Redemptions Please cross out this section if this privilege is not
wanted.

The Fund or its agents are authorized to honor telephone or other
instructions from any person for the redemption of Compass Capital Funds
Shares. Proceeds are to be wire transferred to the bank account referenced
below ($10,000 minimum per redemption). Shareholders holding share
certificates are not eligible for wire redemption.

<TABLE>
<S> <C> <C>
Name of Depositor
--------------------------------------------------------------------------------------------------------------

(as shown on bank records)
Name of Bank ABA # Account #
-------------------------------------- -------------------------------- --------------------------

(a savings and loan or credit union may not be able to receive wire redemptions)

Street Address of Bank City State Zip
-------------------------------- -------------------------------------- --------- -------

</TABLE>

C. Systematic Withdrawal

[ ] Systematic Withdrawal Plan requires a minimum account balance of $10,000
in shares at the current offering price. Minimum withdrawal $100. Each
withdrawal redemption will be processed on or about the 25th of the month
and mailed as soon as possible thereafter. Shareholders holding share
certificates are not eligible for the Systematic Withdrawal Plan because
share certificates must accompany all withdrawal requests.

<TABLE>
<S> <C> <C> <C> <C>
Start (month) $ (amount) [ ] Monthly [ ] Every Other Month [ ] Quarterly
-------------------- ----------------- [ ] Semi-annually [ ] Annually
</TABLE>

Payment Method Please check one of the following:

If you do not check any box your proceeds will be paid by check to the
address of record.

[ ] I request the proceeds to be sent by check to my address of record.
[ ] I request the proceeds to be sent by check payable to a person or
organization different than as registered.

<TABLE>
<S> <C>
Name of Bank or Individual Bank Account # (if applicable)
----------------------------------------------- -----------------------

Street Address City State Zip
------------------------------------- ------------------------------------ --------- ------------

</TABLE>

[ ] I request the above distributions to be sent electronically to my
financial institution as specified below:

<TABLE>
<S> <C>
Name on Bank Account Name of Bank
----------------------------------------------- -----------------------------------------------

Account # Type: [ ] Checking [ ] Savings

----------------------------------------------------------

</TABLE>

Please attach a voided check or savings deposit slip.

Please see reverse side of Application.
<PAGE>

D. Telephone Exchange If you do not wish this privilege, please check this
box: [ ]

Your account will automatically provide for the telephone exchange of Series
A and Series B Shares of the Portfolio for Series A and Series B Shares,
respectively, of other investment portfolios offered by the Fund. Then, when
you wish to exchange shares, all you need to do is call (800) 441-7762.
Shareholders holding share certificates may not exchange shares by
telephone. The same registration and address will be used as listed on this
form under "Registration." It is understood that neither PFPC nor the Fund
will be liable for any loss, liability, cost or expense for acting upon
telephone exchange requests reasonably believed to be genuine.

E. Automatic Investing

This program provides for investments to be made automatically by
authorizing PFPC to withdraw funds from your bank account. An initial
minimum investment of $50 per Portfolio, and subsequent investments of at
least $50, are required. The Program requires additional information so that
PFPC may contact your bank to make sure the arrangement is properly
established. This may not be used with a Systematic Withdrawal Program.

[ ] Check here and the proper form will be sent to you.

F. Rights of Accumulation (Series A Shares only)

I apply for Rights of Accumulation reduced sales charges subject to Agent's
confirmation of the following holdings of Series A Shares in eligible load
Portfolios of the Compass Capital Funds:

<TABLE>
<CAPTION>
Portfolio Shareholder Account #
<S> <C> <C>
--------------------------------------- --------------------------------------- ---------------------------------------
--------------------------------------- --------------------------------------- ---------------------------------------
</TABLE>

G. Letter of Intent (Series A Shares only)

[ ] I agree to the Letter of Intent provisions of the Prospectus. Although
I am not obligated to purchase, and the Fund is not obligated to sell, I
intend to invest, over a 13-month period beginning on ,
---------------------
19 , an aggregate amount in the Compass Capital Funds at least equal to
----
(check appropriate box):

H. Investments of Redemption Proceeds from Other Investment Companies (Series A
Shares only)

[ ] I am purchasing shares of the Compass Capital Funds with the proceeds
from the redemption of shares of another investment company which were sold
with a sales charge or commission.

To qualify for this exemption from the sales charge, purchases of shares of
the Compass Capital Funds must be made within 60 days of the redemption.
This exemption does not apply to purchases of shares with the proceeds from
the redemption of shares of other mutual funds which were or would be
subject to a contingent deferred sales charge upon redemption.

4. Taxpayer Identification Certification

Under penalty of perjury, I certify with my signature below that the number
shown in this section of the application is my correct taxpayer
identification number and that I am not subject to backup withholding as a
result of a failure to report all interest or dividends, or the Internal
Revenue Service has notified me that I am no longer subject to backup
withholding.

If you are subject to backup withholding, check the box in front of the
following statement.

[ ] The Internal Revenue Service has notified me that I am subject to backup
withholding.

<TABLE>
<S> <C>
------------------------------------------------------------ ------------------------------------------------------------
(Signature) (Signature)

------------------------------------------------------------ ------------------------------------------------------------
(President, Trustee, General Partner or Agent) (Co-owner, Secretary of Corporation, Co-trustee, etc.)
</TABLE>

5. Signatures

<TABLE>
<S> <C>
Citizenship: [ ] U.S. [ ] Other Please provide Phone # ( )
------------------------------------ ------ -------------------------
</TABLE>

Sign below exactly as printed in Registration.

I (we) am (are) of legal age and have read the Prospectus. I (we) hereby
certify that each of the persons listed below has been duly elected, and is
now legally holding the office set below his name and has the authority to
make this authorization.

Please print titles below if signing on behalf of a business or trust.

<TABLE>
<S> <C>
------------------------------------------------------------ ------------------------------------------------------------
(Signature) (Signature)

6. Investment Dealer
MUST BE COMPLETED BY DEALER.

<TABLE>
<S> <C>
- -------------------------------------------------- --------------------------------------------------------------------------
Firm Name Representative's Name (print)

NSCC Dealer #
------------------------------------ --------------------------------------------------------------------------
Representative # Phone #

- -------------------------------------------------- --------------------------------------------------------------------------
Branch Street Address City State Zip

- --------------------------------------------------
Branch #

- -------------------------------------------------- --------------------------------------------------------------------------
Representative's Signature Date
</TABLE>

<TABLE>
<S> <C>
For assistance in completing this Application call (800) 441-7762. 1/96 Bond AB Shares
</TABLE>

<PAGE>

The Compass Capital Funds
- --------------------------------------------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTA-
TIONS NOT CONTAINED IN THIS PROSPECTUS, OR IN THE STATEMENT OF ADDITIONAL IN-
FORMATION INCORPORATED HEREIN BY REFERENCE, IN CONNECTION WITH THE OFFERING
MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND OR ITS DISTRIBUTOR. THIS PRO-
SPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE FUND OR BY THE DISTRIBUTOR IN
ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.

-----------------

CORE BOND
PORTFOLIO

INVESTOR SHARES

Prospectus

May 31, 1996
(as revised August 1, 1996)