KPMG PEAT MARWICK LLP
One Mellon Bank Center Telephone 412-391-9710 Telefax 412-391-8963
Pittsburgh, PA 15219 Telex 7106642199 PMM & CO PGH
To the Board of Directors of
Independence One Mutual Funds and the
Securities and Exchange Commission:
We have examined management's assertion about Independence One Mutual Funds'
(the Funds) compliance with the requirements of subsection (b) and (c) of Rule
17f-2 under the Investment Company Act of 1940 as of April 30, 1998, and for the
period from April 1, 1998, through April 30, 1998, included in the accompanying
Management Assertion Regarding Compliance with Certain Provisions of the
Investment Company Act of 1940. Management is responsible for the Funds'
compliance with those requirements. Our responsibility is to express an opinion
on management's assertion about the Funds' compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
examining, on a test basis, evidence about the Funds' compliance with those
requirements and performing such other procedures as we considered necessary in
the circumstances. Included among our procedures were the following tests
performed as of April 30, 1998, and for the period from April 1, 1998, through
April 30, 1998, with respect to securities of the Funds without prior notice to
management:
o Obtaining a statement prepared by the Funds' subcustodian, Chemical
Bank, listing all securities held by the Funds;
o Reconciliation of all securities per the subcustodian's statement to
the books and records of the Funds;
o Reconciliation of all securities held by institutions in book entry
form with The Depository Trust Company ("DTC") and the Federal Reserve
Bank of Chicago (the "Fed") from statements received from DTC and the
Fed, respectively, to the books and records of the Funds;
o Agreement of all securities purchased/sold but not received/delivered
and securities in transit per the books and records of the Funds to
underlying documentation;
o Agreement of all repurchase agreements and the underlying collateral
per the books and records of the Funds to underlying documentation;
and
o Agreement of selected security purchases and sales or maturities since
our last report from the books and records of the Funds to broker
confirmations.
We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Funds' compliance with
specified requirements.
In our opinion, management's assertion that the Funds were in compliance with
the above mentioned provisions of Rule 17f-2 of the Investment Company Act of
1940 as of April 30, 1998, and for the period from April 1, 1998, through April
30, 1998, is fairly stated, in all material respects.
This report is intended solely for the information and use of management of the
Funds and the Securities and Exchange Commission and should not be used for any
other purpose.
KPMG Peat Marwick LLP
Pittsburgh, Pennsylvania
May 14, 1998
<PAGE>
MANAGEMENT ASSERTION REGARDING COMPLIANCE WITH
CERTAIN PROVISIONS OF THE INVESTMENT COMPANY ACT OF 1940
We, as members of management of Independence One Mutual Funds (the Funds) are
responsible for complying with the requirements of subsections (b) and (c) of
Rule 17f-2, "Custody of Investments by Registered Management Investment
Companies," of the Investment Company Act of 1940. We are also responsible for
establishing and maintaining an effective internal control structure over
compliance with Rule 17f-2 requirements. We have performed an evaluation of the
Funds' compliance with the requirements of subsections (b) and (c) of Rule 17f-2
as April 30, 1998.
Based on this evaluation, we assert that the Funds were in compliance with the
requirements of subsections (b) and (c) of Rule 17f-2 of the Investment Company
Act of 1940 as of April 30, 1998, and for the period from April 1, 1998 through
April 30, 1998, with respect to securities reflected in the investments accounts
of the Funds.
Very truly yours,
/s/STACEY GRAY
Stacey Gray
Vice President
Michigan National Bank
/s/JEFFREY W. STERLING
Jeffrey W. Sterling
Assistant Treasurer
Independence One Mutual Funds
<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-17F-2
CERTIFICATE OF ACCOUNTING OF SECURITIES AND SIMILAR INVESTMENTS IN THE CUSTODY
OF MANAGEMENT INVESTMENT COMPANIES
Pursuant to Rule 17f-2 [17 CFR 270, 17f-2]
1. Investment Company Act File Number: 811-5752
Date examination completed: April 30, 1998
2. State Identification Number:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
AL 701554 AK 9400676 AZ S-0027039-QUAL AR 89-M0052-05 CA 5052036 CO IC9101178
CT S121734 DE N/A DC N/A FL 32991 GA 56890081 HI N/A
ID 34126 IL R9531150 IN 89-0600IC IA I-24508 KS 92S0001231 KY M24616
LA 37320 ME MFR 95-7992 MD SM940621 MA 95-4766 MI 267800 MN R-32834
MS MF-89-01-056 MO 134693 MT 024363 NE 74331 NV N/A NH N/A
NJ N/A NM 953804 NY S-25-04-83 NC 000000872 ND D739 OH 88436
OK I-41618 OR 89-0090 PA 89-01-046MF RI N/A SC MF5835 SD 18837
TN RM95-2829 TX M35757-003-06 UT 5824-21 VT 1/20/89-02 VA C-30309 WA C-30308
WV BC-404 WI 240740-03 WY 19046 PUERTO RICO N/A
</TABLE>
Other (specify):
3. Exact number of investment company as specified in registration statement:
INDEPENDENCE ONE MUTUAL FUNDS
4. Address of principal executive office: (number, street, city, state, zip
code) FEDERATED INVESTORS TOWER, PITTSBURGH, PENNSYLVANIA 15222-3779
INSTRUCTIONS
This Form must be completed by the investment companies that have custody of
securities or similar investments.
INVESTMENT COMPANY
1. All items must be completed by the investment company.
2. Give this Form to the independent public accountant who, in compliance with
Rule 17f-2 under the Act and applicable state law, examines securities and
similar investments in the custody of the investment company.
ACCOUNTANT
3. Submit this Form to the Securities and Exchange Commission and appropriate
state securities administrators when filing the certificate of accounting
required by Rule 17f-2 under the Act and applicable state law. File the
original and one copy with the Securities and Exchange Commission's principal
office in Washington, D.C., one copy with the regional office for the region
in which the investment company's principal business operations are
conducted, and one copy with the appropriate state administrator(s), if
applicable.
THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT
