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450 Fifth S reet, N.W.
708-684-600
SIGNATURE DENNIS J MCDONNELL
TITLE PRES, CEO & TRUSTEE
KPMG Peat Marwick LLP
Peat Marwick Plaza Telephone 312 938 1000 Telefax 312 938 0449
303 East Wacker Drive 312 938 3959
Chicago, IL 60601-9973
The Board of Trustees and Shareholders of
Van Kampen American Capital Prime Rate Income Trust:
In planning and performing our audit of the financial statements of Van
Kampen American Capital Prime Rate Income Trust (the "Fund") for the year
ended July 31, 1996, we considered its internal control structure, including
procedures for safeguarding securities, in order to determine our auditing
procedures for the purpose of expressing our opinion on the financial
statements and to comply with the requirements of Form N-SAR, not to provide
assurance on the internal control structure.
The management of the Fund is responsible for establishing and maintaining
an internal control structure. In fulfilling this responsibility, estimates
and judgments by management are required to assess the expected benefits and
related costs of internal control structure policies and procedures. Two of
the objectives of an internal control structure are to provide management
with reasonable, but not absolute, assurance that assets are safeguarded
against loss from unauthorized use or disposition and that transactions are
executed in accordance with management's authorization and recorded properly
to permit the preparation of financial statements in accordance with
generally accepted accounting principles.
Because of inherent limitations in any system of internal control structure,
errors or irregularities may occur and not be detected. Also, projection of
any evaluation of the structure to future periods is subject to the risk
that it may become inadequate because of changes in conditions or that the
effectiveness of the design and operation may deteriorate.
Our consideration of the internal control structure would not necessarily
disclose all matters in the internal control structure that might be
material weaknesses under standards established by the American Institute
of Certified Public Accountants. A material weakness is a condition in
which the design or operation of the specific internal control structure
elements does not reduce to a relatively low level the risk that errors or
irregularities in amounts that would be material in relation to the
financial statements being audited may occur and not be detected within a
timely period by employees in the normal course of performing their
assigned functions. However, we noted no matters involving the internal
control structure, including procedures for safeguarding securities,
that we consider to be material weaknesses as defined above as of July 31,
1996.
This report is intended solely for the information and use of management
and the Securities and Exchange Commission.
/s/KPMG Peat Marwick LLP
September 18, 1996
N-SAR ITEM 77C
Van Kampen American Capital Prime Rate Income Trust
(a) A Special Meeting of Shareholders was held on April 18, 1996.
(b) The election of Trustees included:
David C. Arch, Rod Dammeyer, Howard J Kerr, Dennis J. McDonnell,
Theodore A. Myers, Don G. Powell, Hugo F. Sonnenschein and
Wayne W. Whalen.
The Trustees elected at the meeting are the only Trustees of the Fund.
(c) The following was also voted on at the meeting:
Approval of a material change in the terms of the Fund's investment
advisory agreement with Van Kampen American Capital Investment
Advisory Corp.
For 302,192,444 Against 2,393,232
(d) Inapplicable
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