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SIGNATURE ROBERT L. MUELLER
TITLE VICE PRESIDENT
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders of the
The L. Roy Papp Stock Fund, Inc.
In planning and performing our audit of the financial statements of The L. Roy
Papp Stock Fund, Inc., for the year ended December 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, and not to provide assurance on the internal
control structure.
The management of The L. Roy Papp Stock Fund, Inc., 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 transactions are executed in accordance with management's
authorization and recorded properly to permit preparation of financial
statements in conformity with generally accepted accounting principles.
Because of inherent limitations in any 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 December 31, 1996.
This report is intended solely for the information and use of management,
the Board of Directors, and the Securities and Exchange Commission. This
restriction is not intended to limit the distribution of this report, which
upon acceptance by the Securities and Exchange Commission is a matter of
public record.
Phoenix, Arizona
January 14, 1997
