RIGGS FUNDS, 497, 1998-06-30

RIGGS FUNDS
497, 1998-06-30

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Combined Prospectus

June 30, 1998

Class R Shares
Riggs U.S. Treasury Money Market Fund
Riggs Prime Money Market Fund
Riggs U.S. Government Securities Fund
(formerly RIMCO Monument Bond Fund)
Riggs Stock Fund
Riggs Small Company Stock Fund
(formerly RIMCO Monument Small
Capitalization Equity Fund)

Class Y Shares
Riggs U.S. Treasury Money Market Fund
Riggs Prime Money Market Fund

Federated Securities Corp., Distributor

[LOGO of Riggs Funds]
(formerly RIMCO Monument Funds)

Riggs Funds
(Formerly, RIMCO Monument Funds)
Class R Shares
Class Y Shares
Combined Prospectus

Riggs Funds (the "Trust"), an open-end management investment company (a mutual
fund), offers investors interests in five separate investment portfolios (the
"Funds"), each having a distinct investment objective and policies. This
prospectus relates only to the following classes of the Funds:

. Riggs U.S. Treasury Money Market Fund
Class R Shares
Class Y Shares

. Riggs Prime Money Market Fund
Class R Shares
Class Y Shares

. Riggs U.S. Government Securities Fund
(formerly, RIMCO Monument Bond Fund)
Class R Shares

. Riggs Stock Fund
Class R Shares

. Riggs Small Company Stock Fund
(formerly, RIMCO Monument Small Capitalization Equity Fund)
Class R Shares

The investment adviser to the Funds is Riggs Investment Management Corp.
("RIMCO"), a subsidiary of Riggs Bank N.A. ("Riggs Bank"). Federated Securities
Corp. is the distributor. This combined prospectus contains the information you
should read and know before you invest in any of the Funds in the Trust. Keep
this prospectus for future reference.

Additional information about the Trust is contained in the Trust's combined
Statement of Additional Information dated June 30, 1998 which has also been
filed with the Securities and Exchange Commission ("SEC"). The information
contained in the combined Statement of Additional Information is incorporated by
reference into this prospectus. You may request a copy of the Statement of
Additional Information free of charge, obtain other information, or make
inquiries about any of the Funds by writing to the Trust or calling (301) 887-
4280, or outside the Washington, D.C. metropolitan area by calling toll-free 1-
800-934-3883.

The Shares offered by this prospectus are not FDIC insured and are not deposits
or obligations of or guaranteed by Riggs Bank. Investment in these shares
involves investment risks, including the possible loss of the principal amount
invested.

The Prime Money Market Fund and U.S. Treasury Money Market Fund attempt to
maintain a stable net asset value of $1.00 per share, but there is no assurance
that these funds will be able to do so.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.

Prospectus dated June 30, 1998

<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Summary of Fund Expenses 2
Financial Highlights 4
Synopsis 10
Objective of Each Fund 10
U.S. Treasury Money Market Fund 10
Prime Money Market Fund 11
U.S. Government Securities Fund 12
Stock Fund 13
Small Company Stock Fund 14
Portfolio Investments and Strategies 15
Borrowing Money 15
Diversification 15
Restricted and Illiquid Securities 15
Repurchase Agreements 15
When Issued and Delayed Delivery Transactions 15
Lending of Portfolio Securities 15
Convertible Securities 16
U.S. Government Securities 16
Equity Investment Considerations and Risk Factors 16
Put and Call Options 16
Futures and Options on Futures 16
Investing in Securities of Other Investment Companies 17
Demand Master Notes 17
Foreign Investments 17
Temporary Investments 17
Riggs Funds Information 17
Management of Riggs Funds 17
Distributions of Shares of the Funds 18
Administration of the Funds 19

Net Asset Value 19
Investing in the Funds 19
Share Purchases 19
Minimum Investment Required 20
What Shares Cost 20
Systematic Investment Program 20
Retirement Plans 20
Confirmations and Account Statements 20
Dividends 20
Capital Gains 20
Exchanges 20
Systematic Exchange Program 21
Redeeming Shares 21
Systematic Withdrawal Program 22
Contingent Deferred Sales Charge 22
Eliminating the Contingent Deferred Sales Charge 22
Accounts with Low Balances 23
Shareholder Information 23
Voting Rights 23
Effect of Banking Laws 23
Tax Information 23
Federal Income Tax 23
Performance Information 23
Other Class of Shares 24
Addresses 25
</TABLE>

SUMMARY of fund expenses - Money market funds
Shareholder Transactions Expenses

<TABLE>
<CAPTION>
<S> <C>
Maximum Sales Charge Imposed on Purchases (as a percentage of offering price) None

Maximum Sales Charge Imposed on Reinvested Dividends (as a percentage of
offering price) None Contingent Deferred Sales Charge (as a percentage of
original purchase price or redemption proceeds, as applicable) None Redemption
Fees (as a percentage of amount redeemed, if applicable) None Exchange Fee None
</TABLE>
Annual Operating Expenses
(As a percentage of average net assets)
<TABLE>
<CAPTION>
U.S. Treasury
Money Market Fund Prime Money Market Fund
----------------- -----------------------
Class Y Class R Class Y Class R
Shares Shares Shares Shares
------- ------- ------- -------
<S> <C> <C> <C> <C>
Management Fee 0.50% 0.50% 0.50% 0.50%
12b-1 Fees (after waiver)(1) None 0.25% None 0.25%
Other Expenses 0.21% 0.21% 0.19% 0.19%
Shareholder Servicing Fee (after waiver)(2) 0.00% 0.00% 0.00% 0.00%
Total Annual Operating Expenses(3) 0.71% 0.96% 0.69% 0.94%
</TABLE>
(1) The 12b-1 fee on Class R Shares of each Fund has been reduced to reflect
the voluntary waiver by the distributor. The distributor can terminate this
voluntary waiver of expenses at any time at its sole discretion. With
respect to each Fund the maximum 12b-1 fee is 0.50%.
(2) The shareholder servicing fee of each Fund has been reduced to reflect the
voluntary waiver by the shareholder servicing agent. The shareholder
servicing agent can terminate this voluntary waiver of expenses at any time
at its sole discretion. With respect to each Fund the maximum shareholder
servicing fee is 0.25%.
(3) Expenses in this table are estimated based on expenses expected during the
fiscal year ending April 30, 1999. Actual expenses may be more or less than
the amount shown. The Total Operating Expenses for U.S. Treasury Money
Market Fund - Class Y Shares, Prime Money Market Fund - Class Y Shares, and
Prime Money Market Fund - Class R Shares were 0.63%, 0.58%, and 1.00%,
respectively, for the fiscal year ended April 30, 1998 and would have been
0.71%, 0.69%, and 1.18%, respectively, absent the voluntary waiver of the
management fee and distribution fee.

The purpose of this table is to assist an investor in understanding the various
costs and expenses that a shareholder in the Funds will bear, either directly or
indirectly. For more complete descriptions of the various costs and expenses,
see "Riggs Funds Information", "Investing in the Funds", and the Statement of
Additional Information.

Long-term shareholders may pay more than the economic equivalent of the maximum
front-end sales charges permitted under the rules of the National Association of
Securities Dealers, Inc.

<TABLE>
<CAPTION>
U.S. Treasury
Money Market Fund Prime Money Market Fund
----------------- -----------------------
Class Y Class R Class Y Class R
Shares Shares Shares Shares
------- ------- ------- -------
<S> <C> <C> <C> <C>
You 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.
1 Year $ 7 $11 $ 7 $11
3 Years $23 $34 $22 $33
5 Years $40 n/a $38 n/a
10 Years $88 n/a $86 n/a
</TABLE>

The above example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.

SUMMARY of fund expenses - stock and bond funds

Shareholder Transactions Expenses
Class R Shares
<TABLE>
<CAPTION>

U.S. Government Small Company
Securities Fund Stock Fund Stock Fund
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price) None None None
Maximum Sales Charge Imposed on Reinvested Dividends
(as a percentage of offering price) None None None
Contingent Deferred Sales Charge (as a percentage of original purchase
price or redemption proceeds, as applicable)(1) 2.00% 2.00% 2.00%
Redemption Fees (as a percentage of amount redeemed, if applicable) None None None
Exchange Fee None None None
</TABLE>

Annual Operating Expenses
(As a percentage of averages net assets)
<TABLE>
<CAPTION>

U.S. Government Small Company
Securities Fund Stock Fund Stock Fund
<S> <C> <C> <C>
Management Fee (after waiver)(2) 0.35% 0.80% 0.75%
12b-1 Fees 0.25% 0.25% 0.25%
Other Expenses 0.47% 0.38% 0.25%
Shareholder Servicing Fee (after waiver)(3) 0.00% 0.00% 0.00%
Total Annual Operating Expenses(4) 1.07% 1.43% 1.25%
</TABLE>
(1) The contingent deferred sales charge is 2.00% of the lesser of the original
purchase price or the net asset value of shares redeemed within five years
of the purchase date.
(2) The management fee of U.S. Government Securities Fund has been reduced to
reflect the voluntary waiver by the investment adviser. The adviser can
terminate this voluntary waiver of expenses at any time at its sole
discretion. With respect to this Fund the maximum management fee is 0.75%.
(3) The shareholder servicing fee of each Fund has been reduced to reflect the
voluntary waiver by the shareholder servicing agent. The shareholder
servicing agent can terminate this voluntary waiver of expenses at any time
at its sole discretion. With respect to each Fund the maximum shareholder
servicing fee is 0.25%.
(4) Expenses in this table are estimated based on expenses expected during the
fiscal year ending April 30, 1999. Actual expenses may be more or less than
the amount shown. The Total Operating Expenses for U.S. Government
Securities Fund, Small Company Stock Fund, and Stock Fund were 0.82%,
1.09%, and 0.93%, respectively, for the fiscal year ended April 30, 1998,
and would have been 1.22%, 1.18%, and 1.00%, respectively, absent the
voluntary waiver of the management fee.

Long-term shareholders may pay more than the economic equivalent of the maximum
front-end sales charges permitted under the rules of the National Association of
Securities Dealers, Inc.

U.S. Government Small Company
Example Securities Fund Stock Fund Stock Fund
<S> <C> <C> <C>
You 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.
1 Year $ 33 $ 36 $ 34
3 Years $ 60 $ 70 $ 65
5 Years $ 89 $107 $ 98
10 Years $142 $182 $162
You would pay the following expenses on the same investment, assuming no
redemptions.
1 Year $ 12 $ 16 $ 14
3 Years $ 37 $ 48 $ 43
5 Years $ 64 $ 83 $ 74
10 Years $142 $182 $162
</TABLE>

The above example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown.

Financial Highlights - Riggs U.S. Treasury Money Market Fund
Class Y Shares

(For a share outstanding throughout each period)

The following table has been audited by Ernst & Young LLP, the Trust's
independent auditors. Their report dated June 22, 1998, on the Trust's financial
statements for the year ended April 30, 1998, is included in the Combined Annual
Report, which is incorporated herein by reference. This table should be read in
conjunction with the Fund's financial statements and notes thereto, which may be
obtained free of charge from the Trust. Class R Shares of Riggs U.S. Treasury
Money Market Fund were not offered during the period shown in the table.

<TABLE>
<CAPTION>
Year Ended April 30,
1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
Income from net investment operations
Net investment income 0.05 0.05 0.05 0.04 0.03
Less distributions
Distributions from net investment income (0.05) (0.05) (0.05) (0.04) (0.03)
Net asset value, end of period $ 1.00 $1.00 $1.00 $1.00 $1.00
Total return (a) 5.00% 4.83% 5.28% 4.39% 2.64%
Ratios to average net assets
Expenses 0.63% 0.57% 0.60% 0.60% 0.56%
Net investment income 4.88% 4.74% 5.17% 4.33% 2.61%
Expense waiver/reimbursement (b) 0.08% 0.13% 0.18% 0.20% 0.16%
Supplemental data
Net assets, end of period (000 omitted) $117,424 $141,011 $107,104 $81,089 $106,948
</TABLE>
(a) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.

(b) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above. Further information about the Fund's
performance is contained in the Fund's annual report for the fiscal year ended
April 30, 1998, which can be obtained free of charge.

Financial Highlights - Riggs Prime Money Market Fund
Class Y Shares

(formerly, Class A Shares)
(For a share outstanding throughout each period)

<TABLE>
<CAPTION>
Year Ended April 30,
1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment operations
Net investment income 0.05 0.05 0.05 0.047 0.03
Net realized loss on investments - - - (0.003) -
Total from investment operations 0.05 0.05 0.05 0.044 0.03
Less distributions
Distributions from net investment income (0.05) (0.05) (0.05) (0.047) (0.03)
Capital contribution - - - 0.003 -
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Total return (a) 5.22% 5.09% 5.50% 4.84%(b) 3.08%
Ratios to average net assets
Expenses 0.58% 0.51% 0.51% 0.44% 0.43%
Net investment income 5.11% 5.00% 5.26% 4.72% 3.02%
Expense waiver/reimbursement (c) 0.11% 0.17% 0.19% 0.24% 0.28%
Supplemental data
Net assets, end of period (000 omitted) $318,122 $372,037 $367,742 $284,059 $334,765
</TABLE>
(a) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable. (b) Total return would have
remained at 4.84% absent the capital contribution by Riggs National Corp. (c)
This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.

Further information about the Fund's performance is contained in the Fund's
annual report for the fiscal year ended April 30, 1998, which can be obtained
free of charge.

Financial Highlights - Prime Money Market Fund
Class R Shares
(formerly, Class B Shares)

(For a share outstanding throughout each period)

<TABLE>
<CAPTION>
Year Ended April 30,
1998 1997 1996(a)
<S> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations
Net investment income 0.05 0.05 0.02
Less distributions
Distributions from net investment income (0.05) (0.05) (0.02)
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
Total return (b) 4.92% 4.57% 0.74%
Ratios to average net assets
Expenses 1.00% 1.01% 1.07%*
Net investment income 4.51% 4.58% 4.58%*
Expense waiver/reimbursement (c) 0.18% 0.17% 0.19%*
Supplemental data
Net assets, end of period (000 omitted) $ 508 $26,263 $ 10
</TABLE>
* Computed on an annualized basis.

(a) Reflects operations for the period from December 12, 1995 (date of initial
public investment) to April 30,1996.

(b) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.

Further information about the Fund's performance is contained in the Fund's
annual report for the fiscal year ended April 30, 1998, which can be obtained
free of charge.

Financial Highlights - Riggs U.S. Government Securities Fund
(formerly, RIMCO Monument Bond Fund)
Class R Shares

(For a share outstanding throughout each period)

<TABLE>
<CAPTION>
Year Ended April 30,
1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 9.41 $ 9.47 $ 9.35 $ 9.46 $10.40
Income from investment operations
Net investment income 0.56 0.60 0.59 0.56 0.53
Net realized and unrealized gain (loss) on investments 0.37 (0.07) 0.12 (0.11) (0.38)
Total from investment operations 0.93 0.53 0.71 0.45 0.15
Less distributions
Distributions from net investment income (0.57) (0.59) (0.59) (0.56) (0.53)
Distributions from net realized gain - - - - (0.56)
Total distributions (0.57) (0.59) (0.59) (0.56) (1.09)
Net asset value, end of period $ 9.77 $ 9.41 $ 9.47 $ 9.35 $ 9.46
Total return (a) 10.14% 5.79% 7.60% 5.01% 1.10%
Ratios to average net assets
Expenses 0.82% 0.87% 0.80% 0.80% 0.68%
Net investment income 5.87% 6.36% 6.04% 6.06% 5.15%
Expense reimbursement/waiver (b) 0.40% 0.40% 0.40% 0.40% 0.48%
Supplemental data
Net assets, end of period (000 omitted) $34,521 $31,829 $50,919 $46,820 $47,552
Portfolio turnover 175% 171% 128% 262% 344%
</TABLE>
(a) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.

(b) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.

Further information about the Fund's performance is contained in the Fund's
annual report for the fiscal year ended April 30, 1998, which can be obtained
free of charge.

Financial Highlights - RIGGS Stock Fund
Class R Shares
(For a share outstanding throughout each period)

<TABLE>
<CAPTION>
Year Ended April 30,
1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 15.41 $ 15.84 $ 12.69 $ 11.89 $ 10.46
Income from investment operations
Net investment income 0.11 0.20 0.18 0.20 0.16
Net realized and unrealized gain on investments 5.20 2.28 4.00 1.39 1.44
Total from investment operations 5.31 2.48 4.18 1.59 1.60
Less distributions
Distributions from net investment income (0.11) (0.20) (0.18) (0.19) (0.16)
Distributions from net realized gain (4.04) (2.71) (0.85) (0.60) (0.01)
Total distributions (4.15) (2.91) (1.03) (0.79) (0.17)
Net asset value, end of period $ 16.57 $ 15.41 $ 15.84 $ 12.69 $ 11.89
Total return (a) 39.68% 16.34% 33.73% 14.16% 15.28%
Ratios to average net assets
Expenses 0.93% 0.91% 0.96% 0.98% 1.00%
Net investment income 0.63% 1.26% 1.26% 1.66% 1.36%
Expense reimbursement/waiver (b) 0.07% 0.12% 0.12% 0.14% 0.20%
Supplemental data
Net assets, end of period (000 omitted) $117,115 $89,142 $84,797 $66,019 $58,597
Average commission rate paid (c) $ 0.0668 $0.0619 $0.0687 -- --
Portfolio turnover 94% 75% 81% 46% 89%
</TABLE>
(a) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.

(b) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.

(c) Represents total commissions paid on portfolio securities divided by total
portfolio shares purchased or sold on which commissions were charged. This
disclosure is required for fiscal years beginning on or after September 1, 1995.

Further information about the Fund's performance is contained in the Fund's
annual report for the fiscal year ended April 30, 1998, which can be obtained
free of charge.

Financial Highlights - RIGGS Small COMPANY STOCK Fund
(formerly, RIMCO Monument Small Capitalization Equity Fund)
Class R Shares

(For a share outstanding throughout each period)

* Computed on an annualized basis.

(a) Reflects operations for the period from February 27, 1995 (date of initial
public investment) to April 30, 1995.

(b) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.

(d) Represents total commissions paid on portfolio securities divided by total
portfolio shares purchased or sold on which commissions were charged.

Further information about the Fund's performance is contained in the Fund's
annual report for the fiscal year ended April 30, 1998, which can be obtained
free of charge.

Synopsis

The Trust, an open-end management investment company, was established as a
Massachusetts business trust under a Declaration of Trust dated April 1, 1991.
The Declaration of Trust permits the Trust to offer separate series of shares of
beneficial interest representing interests in separate portfolios of securities.
The shares of any one portfolio may be offered in separate classes. This
prospectus pertains only to Class R Shares and Class Y Shares of the Funds.

As of the date of this prospectus, the Trust is comprised of the following five
Funds:

. Riggs U.S. Treasury Money Market Fund ("U.S. Treasury Money Market Fund") -
seeks to provide current income consistent with stability of principal and
liquidity by investing in U.S. Treasury obligations. Shares of U.S. Treasury
Money Market Fund are issued in two separate classes: Class R Shares and
Class Y Shares.

. Riggs Prime Money Market Fund ("Prime Money Market Fund" and together with
the U.S. Treasury Money Market Fund, the "Money Market Funds") - seeks to
provide current income consistent with stability of principal and liquidity
by investing exclusively in a portfolio of money market instruments maturing
in 13 months or less. Shares of Prime Money Market Fund are issued in two
separate classes: Class R Shares and Class Y Shares.

. Riggs U.S. Government Securities Fund ("U.S. Government Securities Fund") -
seeks to achieve current income by investing in a diversified portfolio
limited primarily to U.S. government securities. Shares of U.S. Government
Securities Fund are issued in a single class: Class R Shares.

. Riggs Stock Fund ("Stock Fund") - seeks to provide growth of capital and
income primarily through equity investments such as common stocks and
securities convertible into common stocks. Shares of Stock Fund are issued in
two separate classes: Class R Shares and Class B Shares.

. Riggs Small Company Stock Fund ("Small Company Stock Fund") - seeks to
provide long-term capital appreciation through equity securities of companies
that have a market value capitalization of up to $1 billion. Shares of Small
Company Stock Fund are issued in two separate classes: Class R Shares and
Class B Shares.

For information on how to purchase shares of any of the Funds please refer to
"Investing in the Funds." In most cases, a minimum initial investment of $1000
is required for each Fund. In most cases, subsequent investments must be in
amounts of at least $100. See "Minimum Investment Required." Shares of the Funds
are sold at net asset value without a sales charge. Both Class R Shares and
Class Y Shares of the Money Market Funds are redeemed at net asset value. Class
R Shares of Stock Fund, Small Company Stock Fund, and U.S. Government Securities
Fund are redeemed at net asset value less a contingent deferred sales charge, as
applicable. Information on redeeming shares can be found under "Redeeming
Shares" and "Contingent Deferred Sales Charge." The Funds are advised by Riggs
Investment Management Corp.

Risk Factors

Investors should be aware of the following general considerations. The market
value of fixed-income securities, which constitute a major part of the
investments of several Funds, may vary inversely in response to changes in
prevailing interest rates. The market value of the equity securities, which
constitute a major portion of the investments of several funds, will also
fluctuate, and the possibility exists that the value of common stocks could
decline over short or even extended periods of time. The section entitled
"Equity Investment Considerations and Risk Factors" also discloses the potential
risks related to small capitalization stocks. The foreign securities in which
several Funds may invest may be subject to certain risks in addition to those
inherent in U.S. investments. One or more Funds may make certain investments and
employ certain investment techniques that involve other risks, including
entering into repurchase agreements, lending portfolio securities and entering
into futures contracts and related options as hedges. These risks and those
associated with investing in mortgage-backed securities, when-issued securities,
options and variable rate securities are described under "Objective of Each
Fund" and "Portfolio Investments and Strategies."

Year 2000 Statement

Like other mutual funds and business organizations worldwide, the Funds' service
providers (among them, the adviser, distributor, administrator and transfer
agent) must ensure that their computer systems are adjusted to properly process
and calculate date-related information from and after January 1, 2000. Many
software programs and, to a lesser extent, the computer hardware in use today
cannot distinguish the year 2000 from the year 1900. Such a design flaw could
have a negative impact in the handling of securities trades, pricing and
accounting services. The Funds' and their service providers are actively working
on necessary changes to computer systems to deal with the year 2000 issue and
believe that systems will be year 2000 compliant when required. The Funds are
continuing to analyze the financial impact of instituting a year 2000 compliant
program on their operations. Analysis continues regarding the financial impact
of instituting a year 2000 compliant program on the Funds' operations.

Objective of Each Fund

The investment objective and policies of each Fund appear below. The investment
objective of a Fund cannot be changed without the approval of holders of a
majority of that Fund's shares. While there is no assurance that a Fund will
achieve its investment objective, it endeavors to do so by following the
investment policies described in this prospectus and, with respect to the Money
Market Funds, by complying with the diversification and other requirements of
Rule 2a-7 under the Investment Company Act of 1940 which regulates money market
mutual funds.

Unless indicated otherwise, the investment policies of a Fund may be changed by
the Trustees without approval of shareholders. Shareholders will be notified
before any material change in these policies becomes effective.

Additional information about investment limitations, strategies that one or more
Funds may employ, and certain investment policies mentioned below appear in the
"Portfolio Investments and Strategies" section of this prospectus and in the
combined Statement of Additional Information.

U.S. Treasury Money Market Fund

The investment objective of U.S. Treasury Money Market Fund is to provide
current income consistent with stability of principal and liquidity. The Fund
pursues its investment objective by investing its assets in U.S. Treasury
obligations which are issued by the U.S. government, and are fully guaranteed as
to payment of principal and interest by the United States.

Acceptable Investments

The Fund invests only in U.S. Treasury obligations maturing in 13 months or less
and in repurchase agreements fully collateralized by U.S. Treasury obligations.
See "Repurchase Agreements." The average maturity of the U.S. Treasury
obligations in the Fund's portfolio, computed on a dollar-weighted basis, will
be 90 days or less.

In addition, the Fund may borrow money, lend portfolio securities and engage in
when-issued and delayed delivery transactions. See "Portfolio Investments and
Strategies."

Investment Limitations

The Fund's investment limitations are discussed below under "Borrowing Money"
and "Restricted and Illiquid Securities."
Prime Money Market Fund

The investment objective of the Prime Money Market Fund is to provide current
income consistent with stability of principal and liquidity. The Fund pursues
its investment objective by investing exclusively in a portfolio of money market
instruments maturing in 13 months or less. The average maturity of the money
market instruments in the Fund's portfolio, computed on a dollar-weighted basis,
will be 90 days or less.

Acceptable Investments

The Fund invests in high quality money market instruments that are either rated
in the highest short-term rating category by nationally recognized statistical
rating organizations ("NRSROs") or are of comparable quality to securities
having such ratings. Examples of these instruments include, but are not limited
to:

. domestic issues of corporate or municipal debt obligations, including,
variable rate demand notes;

. commercial paper (including Canadian Commercial Paper and Europaper);

. certificates of deposit, demand and time deposits, savings shares, bankers'
acceptances and other instruments of domestic and foreign banks, savings
associations and other deposit or thrift institutions ("Bank Instruments");

. short-term credit facilities;

. obligations issued or guaranteed as to payment of principal and interest by
the U.S. government or one of its agencies or instrumentalities ("Government
Securities") (See "Portfolio Investments and Strategies"); and

. other money market instruments.

The Fund invests only in instruments denominated and payable in
U.S. dollars.

In addition, the Fund may borrow money, lend portfolio securities, invest in
restricted and illiquid securities, repurchase agreements and variable amount
demand master notes and engage in when-issued and delayed delivery transactions.
See "Portfolio Investments and Strategies."

Bank Instruments

The Fund only invests in Bank Instruments either issued by an institution having
capital, surplus and undivided profits over $100 million or insured by the Bank
Insurance Fund ("BIF") or the Savings Association Insurance Fund ("SAIF"). Bank
Instruments may include Eurodollar Certificates of Deposit ("ECDs"), Yankee
Certificates of Deposit ("Yankee CDs") and Eurodollar Time Deposits ("ETDs").
The Fund will treat securities credit-enhanced with a bank's letter of credit as
Bank Instruments.

Municipal Securities

Municipal securities are generally issued to finance public works, such as
airports, bridges, highways, housing, hospitals, mass transportation projects,
schools, streets, and water and sewer works. They are also issued to repay
outstanding obligations, to raise funds for general operating expenses, and to
make loans to other public institutions and facilities.

Municipal securities include private activity bonds issued by or on behalf of
public authorities to provide financing aid to acquire sites or construct and
equip facilities for privately or publicly owned corporations. The availability
of this financing encourages these corporations to locate within the sponsoring
communities and thereby increases local employment.

The two principal classifications of municipal securities are "general
obligation" and "revenue" bonds. General obligation bonds are secured by the
issuer's pledge of its full faith and credit and taxing power for the payment of
principal and interest. Interest on and principal of revenue bonds, however, are
payable only from the revenue generated by the facility financed by the bond or
other specified sources of revenue. Revenue bonds do not represent a pledge of
credit or create any debt of or charge against the general revenues of a
municipality or public authority. Bonds are typically classified as revenue
bonds.

Investment Risks

Yields on municipal securities depend on a variety of factors, including: the
general conditions of the short-term municipal note market and of the municipal
bond market; the size of the particular offering; the maturity of the
obligations; and the rating of the issue. The ability of the Fund to achieve its
investment objective also depends on the continuing ability of the issuers of
municipal securities and participation interests, or the guarantors of either,
to meet their obligations for the payment of interest and principal when due.

Variable Rate Demand Notes

Variable rate demand notes are long-term corporate or municipal debt instruments
that have variable or floating interest rates and provide the Fund with the
right to tender the security for repurchase at its stated principal amount plus
accrued interest. Such securities typically bear interest at a rate that is
intended to cause the securities to trade at par. The interest rate may float or
be adjusted at regular intervals (ranging from daily to annually), and is
normally based on a published interest rate or interest rate index. Most
variable rate demand notes allow the Fund to demand the repurchase of the
security on not more than seven days prior notice. Other notes only permit the
Fund to tender the security at the time of each interest rate adjustment or at
other fixed intervals. See "Demand Features." The Fund treats variable rate
demand notes as maturing on the later of the date of the next interest rate
adjustment or the date on which the Fund may next tender the security for
repurchase.

Short-Term Credit Facilities

The Fund may enter into, or acquire participations in, short-term borrowing
arrangements with corporations, consisting of either a short-term revolving
credit facility or a master note agreement payable upon demand. Under these
arrangements, the borrower may request advances from the Fund and may repay and
reborrow funds during the term of the facility. The Fund treats any commitment
to provide such advances as a standby commitment to purchase the borrower's
notes.

Credit Enhancement

Certain of the Fund's acceptable investments may have been credit-enhanced by a
guaranty, letter of credit or insurance. Any bankruptcy, receivership, default,
or change in the credit quality of the party providing the credit enhancement
will adversely affect the quality and marketability of the underlying security
and could cause losses to the Fund and affect its share price. The Fund may have
more than 25% of its total assets invested in securities credit-enhanced by
banks.

Demand Features

The Fund may acquire securities that are subject to puts and standby commitments
("Demand Features") to repurchase the securities at their principal amount
(usually with accrued interest) within a fixed period (usually seven days)
following a demand by the Fund. The Demand Feature may be issued by the issuer
of the underlying securities, a dealer in the securities or by another third
party, and may not be transferred separately from the underlying security. The
Fund uses these arrangements to provide the Fund with liquidity and not to
protect against changes in the market value of the underlying securities. The
bankruptcy, receivership or default by the issuer of the Demand Feature, or a
default on the underlying security or other event that terminates the Demand
Feature before its exercise, will adversely affect the liquidity of the
underlying security. Demand Features that are exercisable even after a payment
default on the underlying security may be treated as a form of credit
enhancement.

Investment Limitations

The Fund's investment limitations are discussed below under "Borrowing Money,"
"Diversification," and "Restricted and Illiquid Securities."

U.S. Government Securities Fund

The investment objective of the U.S. Government Securities Fund is to achieve
current income.

Acceptable Investments

The Fund pursues its investment objective by investing primarily in securities
which are primary or direct obligations of the U.S. government or its
instrumentalities or which are guaranteed by the U.S. government, its agencies,
or instrumentalities (see "Portfolio Investments and Strategies"). The Fund may
also invest in corporate debt obligations, bank instruments, commercial paper
and certain collateralized mortgage obligations ("CMOs") supported by direct or
indirect obligations of the U.S. government or its instrumentalities. The Fund
will invest, under normal circumstances, at least 65% of the value of its total
assets in U.S. government securities.

U.S. Government Securities

The U.S. government securities in which the Fund invests include:

. direct obligations of the U.S. Treasury, such as U.S. Treasury bills, notes,
and bonds;

. notes, bonds, and discount notes issued or guaranteed by U.S. government
agencies and instrumentalities supported by the full faith and credit of the
United States;

. notes, bonds, and discount notes of U.S. government agencies or
instrumentalities which receive or have access to federal funding;

. notes, bonds, and discount notes of other U.S. government instrumentalities
supported only by the credit of the instrumentalities; and

. collateralized mortgage obligations.

Other Acceptable Investments

Up to 35% of the value of the Fund's total assets may be invested in the
following instruments:

. domestic issues of corporate debt obligations and U.S. dollar denominated
debt obligations of foreign corporations and governments rated Baa or better,
Aaa, Aa, or A by Moody's Investor Services, Inc. (Moody's); BBB or better,
AAA, AA, or A by Standard and Poor's (S&P); or BBB or better, AAA, AA, or A
by Fitch IBCA, Inc. (Fitch);

. obligations issued or guaranteed by the U.S. government, its agencies or
instrumentalities (see "Portfolio Investments and Strategies");

. commercial paper which matures in 270 days or less so long as at least two
ratings are high quality ratings by NRSROs. Such ratings would include: A-1
by S&P, Prime-1 by Moody's, or F-1 by Fitch and, unrated but deemed to be of
comparable quality by the investment adviser, including Canadian Commercial
Paper and Europaper; and

. instruments of domestic and foreign banks and savings associations as
described above under "Prime Money Market Fund - Acceptable Investments" and
"Bank Instruments".

The Fund will only purchase corporate debt obligations that at the time of
purchase are rated investment grade or better. An investment grade security can
range from the highest rating (AAA) to medium quality (BBB). Securities in the
BBB category may be more susceptible to adverse economic conditions or changing
circumstances and the securities at the lower end of the BBB category may have
certain speculative characteristics. The Fund intends to limit its investment in
bonds rated in the lowest investment grade category to 10% of its total assets.
While the Fund will only purchase corporate debt obligations that, at the time
of purchase, are rated in the top three ratings categories, in the event that
any such security is downgraded to the fourth highest ratings category, the Fund
may continue to hold such a security. Obligations rated in the lowest of the top
four ratings, such as Baa by Moody's or BBB by S&P or Fitch, have speculative
characteristics. Changes in economic conditions or other circumstances are more
likely to lead to weakened capacity to make principal and interest payments than
higher rated bonds. In the event that any such security is downgraded by a
ratings service below the fourth highest rating category, the Fund will dispose
of the security.

In addition, the Fund may borrow money, lend portfolio securities, invest in
restricted and illiquid securities, repurchase agreements, securities of other
investment companies, and variable amount demand master notes and engage in put
and call options, futures and options on futures and when-issued and delayed
delivery transactions. See "Portfolio Investments and Strategies."

Collateralized Mortgage Obligations

The Fund may invest in collateralized mortgage obligations ("CMOs") which are
rated A or better by an NRSRO and which are issued by private entities such as
investment banking firms and companies related to the construction industry. The
CMOs in which the Fund may invest may be: (i) privately issued securities which
are collateralized by pools of mortgages in which each mortgage is guaranteed as
to payment of principal and interest by an agency or instrumentality of the U.S.
government; (ii) privately issued securities which are collateralized by pools
of mortgages in which payment of principal and interest are guaranteed by the
issuer and such guarantee is collateralized by U.S. government securities; and
(iii) other privately issued securities in which the proceeds of the issuance
are invested in mortgage-backed securities and payment of the principal and
interest are supported by the credit of an agency or instrumentality of the U.S.
government. The mortgage-related securities provide for a periodic payment
consisting of both interest and principal. The interest portion of these
payments will be distributed by the Fund as income, and the capital portion will
be reinvested.

Participation Interests

The Fund may purchase participation interests from financial institutions (such
as commercial banks, savings associations, and insurance companies), or from
single-purpose, stand-alone finance subsidiaries or trusts of such institutions,
or from other special purpose entities. Single-purpose, stand-alone finance
subsidiaries or trusts and special purpose entities generally do not have any
significant assets other than the receivables securing the participation
interests. Participation interests give the Fund an undivided fractional
ownership interest in debt obligations. The debt obligations may include pools
of credit card receivables, automobile installment loan contracts, corporate
loans or debt securities, corporate receivables or other types of debt
obligations. In addition to being supported by the stream of payments generated
by the debt obligations, payments of principal and interest on the participation
interests may be supported up to certain amounts and for certain periods of time
by irrevocable letters of credit, insurance policies, and/or other credit
agreements issued by financial institutions unaffiliated with the issuers and by
monies on deposit in certain bank accounts of the issuer. Payments of interest
on the participation interests may also rely on payments made pursuant to
interest rate swap agreements made with other unaffiliated financial
institutions.

The participation interests described above will be rated A or better by Moody's
or by S&P. The Fund may also invest in participation interests which are not
rated but are determined by the Board of Trustees to be of comparable quality.

If the participation interests include the unconditional written right to demand
payment at par value plus accrued interest from the issuer, the Demand Feature
will be used in determining the maturity of the participation interest. So long
as the Demand Feature can require payment by the issuer within seven days, the
participation interest will not be deemed to be illiquid. The secondary market,
if any, for certain of these obligations may be extremely limited and any such
obligations purchased by the Fund will be regarded as illiquid, unless they
include the seven-day Demand Feature. Such illiquid obligations will be included
within the 15% limitation by the Fund on investment of its net assets in
illiquid securities.

Portfolio Turnover

Although the Fund does not intend to invest for the purpose of seeking
short-term profits, securities in its portfolio will be sold whenever the Fund's
investment adviser believes it is appropriate to do so in light of the Fund's
investment objective, without regard to the length of time a particular security
may have been held. It is not anticipated that the portfolio trading engaged in
by the Fund will result in its annual rate of portfolio turnover exceeding 200%.
A portfolio turnover rate of 100% would occur, for example, if all the
securities in the Fund's portfolio were replaced once in a period of one year.
The Fund's rate of portfolio turnover may exceed that of certain other mutual
funds with the same investment objective. A higher rate of portfolio turnover
involves correspondingly greater transaction expenses which must be borne
directly by the Fund and, thus, indirectly by its shareholders. In addition, a
high rate of portfolio turnover may result in the realization of larger amounts
of capital gains which, when distributed to the Fund's shareholders, are taxable
to them. (Further information is contained in the Trust's Statement of
Additional Information within the sections "Brokerage Transactions" and "Tax
Status"). Nevertheless, transactions for the Fund's portfolio will be based only
upon investment considerations and will not be limited by any other
considerations when the Fund's investment adviser deems it appropriate to make
changes in the Fund's portfolio.

Investment Limitations

The Fund's investment limitations are discussed below under "Borrowing Money,"
"Diversification," and "Restricted and Illiquid Securities."

Stock Fund

The investment objective of the Stock Fund is to provide growth of capital and
income. The Fund pursues its investment objective primarily through equity
investments, such as common stocks and securities convertible into common
stocks.

Acceptable Investments

The securities in which the Fund invests include, but are not limited to:

. common stocks and securities convertible into common stocks which will be
primarily composed of issues of high quality large capitalization domestic
companies. See "Portfolio Investments and Strategies." Under normal market
conditions, at least 65% of the Fund's portfolio will be invested in stocks.
These will generally be readily recognizable companies whose earnings and
dividends are growing at above average rates;

. preferred stocks, corporate bonds, notes, warrants, and rights;

. American Depositary Receipts ("ADRs"), which are receipts typically issued by
an American bank or trust company that evidences ownership of underlying
securities issued by a foreign issuer. ADRs may not necessarily be
denominated in the same currency as the securities into which they may be
converted. Generally, ADRs, in registered form, are designed for use in U.S.
securities markets. The Fund may invest up to 20% of its net assets in ADRs;

. commercial paper rated A-1 by S&P, Prime-1 by Moody's, or F-1+ or F-1 by
Fitch, and money market instruments (including commercial paper) which are
unrated but deemed to be of comparable quality by the investment adviser,
including Canadian Commercial Paper and Europaper;

. instruments of domestic and foreign banks and savings associations as
described above under "Prime Money Market Fund - Acceptable Investments" and
"Bank Instruments"; and

. securities issued or guaranteed by the U.S. government, its agencies or
instrumentalities, including those obligations purchased on a when-issued or
delayed delivery basis. See "Portfolio Investments and Strategies."

In addition, the Fund may borrow money, lend portfolio securities, invest in
restricted and illiquid securities, repurchase agreements, securities of other
investment companies, and variable amount demand master notes and engage in put
and call options, futures and options on futures and when-issued and delayed
delivery transactions. See "Portfolio Investments and Strategies."

In selecting investments for the Fund, the investment adviser follows a value-
based, disciplined investment philosophy. Using a computer model and hands-on
fundamental analysis, stocks are selected based on such factors as low
price/earnings ratios relative to earnings growth and history; rising earnings
estimates; relative price strength; high or improving earnings; and credit
quality.

Computer screens based upon value criteria are applied to a listing of 750
stocks that are selected based upon market capitalization, trading volume, and
availability of data, to rank them according to relative attractiveness. These
rankings are refined by additional screens focusing on earnings growth and
relative price strength. This computer model is complemented with the adviser's
fundamental analysis to produce a list of securities from which the adviser will
select what it believes to be especially attractive issues.

The relative price action of each stock is monitored, and price momentum is
followed to determine when the value of a security is beginning to be recognized
by the market.

Portfolio Turnover

Although the Fund does not intend to invest for the purpose of seeking
short-term profits, securities in its portfolio will be sold whenever the Fund's
investment adviser believes it is appropriate to do so in light of the Fund's
investment objective, without regard to the length of time a particular security
may have been held. It is not anticipated that the portfolio trading engaged in
by the Fund will result in its annual rate of portfolio turnover exceeding 200%.
A portfolio turnover rate of 100% would occur, for example, if all the
securities in the Fund's portfolio were replaced once in a period of one year.
The Fund's rate of portfolio turnover may exceed that of certain other mutual
funds with the same investment objective. A higher rate of portfolio turnover
involves correspondingly greater brokerage commissions and other expenses which
must be borne directly by the Fund and, thus, indirectly by its shareholders. In
addition, a high rate of portfolio turnover may result in the realization of
larger amounts of capital gains which, when distributed to the Fund's
shareholders, are taxable to them. Nevertheless, transactions for the Fund's
portfolio will be based only upon investment considerations and will not be
limited by any other considerations when the Fund's investment adviser deems it
appropriate to make changes in the Fund's portfolio.

Investment Limitations

The Fund's investment limitations are discussed below under "Borrowing Money,"
"Diversification," and "Restricted and Illiquid Securities."

Small Company Stock Fund

The investment objective of the Small Company Stock Fund is to provide long-term
capital appreciation. The Fund pursues its investment objective by investing
primarily in a broad, diversified range of equity securities comprising the
small capitalization sector of the United States equity market (companies which
have a market value capitalization up to $1.2 billion.)

Acceptable Investments

The securities in which the Fund invests include, but are not limited to:

. common stocks, and securities convertible into common stocks which will be
primarily composed of issues of small capitalization domestic companies. See
"Portfolio Investments and Strategies" and "Equity Investment
Considerations." Under normal market conditions, at least 65% of the Fund's
portfolio will be invested in equity securities of companies that have a
market value capitalization of up to $1.2 billion;

. preferred stocks, real estate investment trusts, corporate bonds, notes,
warrants, and rights;

. ADRs of foreign companies as described above under "Stock Fund - Acceptable
Investments;"

. commercial paper rated A-1 by S&P, Prime-1 by Moody's, or F-1 by Fitch, and
money market instruments (including commercial paper) which are unrated but
deemed to be of comparable quality by the investment adviser, including
Canadian Commercial Paper and Europaper;

. instruments of domestic and foreign banks and savings associations as
described above under "Prime Money Market Fund - Acceptable Investments" and
"Bank Instruments;" and

While the Fund will only purchase corporate debt obligations that, at the time
of purchase, are rated in the top three rating categories, in the event that any
such security is downgraded to the fourth category, the Fund may continue to
hold the security. Obligations rated in the lowest of the top four ratings, such
as Baa by Moody's or BBB by S&P or Fitch, have speculative characteristics.
Changes in economic conditions or other circumstances are more likely to lead to
weakened capacity to make principal and interest payments than higher rated
bonds. In the event that any such security is downgraded by a ratings service
below the fourth highest rating category, the Fund will dispose of the security.

In selecting investments for the Fund, the investment adviser employs the same
value-based, disciplined investment philosophy that is described above with
respect to the Stock Fund, and applies it to the small capitalization sector of
the equity market. Using a computer model and hands-on fundamental analysis,
small capitalization stocks are selected based on such factors as low
price/earnings ratios relative to earnings growth and history; rising earnings
estimates; relative price strength; high or improving earnings; and credit
quality.

Computer screens based upon value criteria are applied to a listing of small
capitalization stocks that are selected using the same methodology that is used
for the Stock Fund to rank them according to relative attractiveness. These
rankings are refined by additional screens focusing on earnings growth and
relative price strength. This computer model is complemented with the adviser's
fundamental analysis to produce a list of securities from which the adviser will
select what it believes to be especially attractive issues.

The relative price action of each small capitalization stock is monitored, and
price momentum is followed to determine when the value of a security is
beginning to be recognized by the market.

In addition, the Fund may borrow money, lend portfolio securities, invest in
restricted and illiquid securities, repurchase agreements, securities of other
investment companies, and engage in when-issued and delayed delivery
transactions. The Fund may also invest in put and call options, futures, and
options on futures, for hedging purposes. See "Portfolio Investments and
Strategies" for a discussion of these investments as well as the potential risks
related to small capitalization stocks. The Fund's investments in real estate
investment trusts may be subject to risks associated with direct ownership of
real estate, including declines in the value of real estate, risks related to
general and local economic conditions, increases in interest rates, and other
factors discussed under this heading in the Statement of Additional Information.

Investment Limitations

The Fund's investment limitations are discussed below under "Borrowing Money,"
"Diversification," and "Restricted and Illiquid Securities."

Portfolio Investments and Strategies

Borrowing Money

The Funds will not borrow money directly or through reverse repurchase
agreements (arrangements in which a Fund sells a money market instrument for a
percentage of its cash value with an agreement to buy it back on a set date) or
pledge securities except, under certain circumstances, a Fund may borrow money
up to one-third of the value of its total assets and pledge up to 10% (in the
case of the U.S. Treasury Money Market Fund and Prime Money Market Fund) or 15%
(in the case of the Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund) of the value of those assets to secure such borrowings. This
policy cannot be changed without the approval of holders of a majority of a
Fund's shares.

Diversification

With respect to 75% of the value of total assets, the Prime Money Market Fund,
Stock Fund, Small Company Stock Fund, and U.S. Government Securities Fund will
not invest more than 5% in securities of any one issuer other than cash, cash
items or securities issued or guaranteed by the government of the United States
or its agencies or instrumentalities and repurchase agreements collateralized by
U.S. government securities. The Funds will not acquire more than 10% of the
outstanding voting securities of any one issuer. This policy cannot be changed
without the approval of holders of a majority of a Fund's shares.

Restricted and Illiquid Securities

The Prime Money Market Fund, Stock Fund, Small Company Stock Fund, and U.S.
Government Securities Fund may invest in restricted securities. The U.S.
Treasury Fund will not invest in restricted securities. Restricted securities
are any securities in which a Fund may invest pursuant to its investment
objective and policies but which are subject to restriction on resale under
federal securities law. The Stock Fund, Small Company Stock Fund, and U.S.
Government Securities Fund will limit investments in illiquid securities
(including certain restricted securities not determined by the Trustees to be
liquid, nonnegotiable time deposits, over-the-counter options, and repurchase
agreements providing for settlement in more than seven days after notice) to 15%
of their net assets. The Money Market Funds will limit investments in illiquid
securities to 10% of their respective net assets.

A Fund may invest in commercial paper issued in reliance on the exemption from
registration afforded by Section 4(2) of the Securities Act of 1933. Section
4(2) commercial paper is restricted as to disposition under federal securities
law, and is generally sold to institutional investors, such as one of these
Funds, who agree that they are purchasing the paper for investment purposes and
not with a view to public distribution. Any resale by the purchaser must be in
an exempt transaction. Section 4(2) commercial paper is normally resold to other
institutional investors through or with the assistance of the issuer or
investment dealers who make a market in Section 4(2) commercial paper, thus
providing liquidity. The Funds believe that Section 4(2) commercial paper and
certain other restricted securities, which meet the criteria for liquidity
established by the Trustees, are quite liquid. Therefore, the Funds intend to
treat these securities as liquid and not subject to the investment limitation
applicable to illiquid securities. In addition, because these securities are
liquid, the Funds will not subject such securities to the limitation otherwise
applicable to restricted securities.

Repurchase Agreements

The securities in which each Fund invests may be purchased pursuant to
repurchase agreements. Repurchase agreements are arrangements in which banks,
broker/dealers, and other recognized financial institutions sell U.S. government
securities or other securities to a Fund and agree at the time of sale to
repurchase them at a mutually agreed upon time and price. To the extent that the
original seller does not repurchase the securities from a Fund, that Fund could
receive less than the repurchase price on any sale of such securities. The Funds
will only enter into repurchase agreements with banks and other recognized
financial institutions such as broker/dealers which are deemed by the Funds'
adviser to be creditworthy pursuant to guidelines established by the Trustees.

When-Issued and Delayed Delivery Transactions

The Funds may purchase securities on a when-issued or delayed delivery basis.
These transactions are arrangements in which a Fund purchases securities with
payment and delivery scheduled for a future time. The sellers' failure to
complete the transaction may cause a Fund to miss a price or yield considered to
be advantageous. Settlement dates may be a month or more after entering into
these transactions, and the market values of the securities purchased may vary
from the purchase prices.

A Fund may dispose of a commitment prior to settlement if the adviser deems it
appropriate to do so. In addition, a Fund may enter into transactions to sell
its purchase commitments to third parties at current market values and
simultaneously acquire other commitments to purchase similar securities at later
dates. A Fund may realize short-term profits or losses upon the sale of such
commitments.

Lending of Portfolio Securities

In order to generate additional income, each Fund may lend portfolio securities
on a short-term or long-term basis, or both, up to one-third of the value of its
total assets to broker/dealers, banks, or other institutional borrowers of
securities. A Fund will only enter into loan arrangements with broker/dealers,
banks, or other institutions which the investment adviser has determined are
creditworthy under guidelines established by the Trustees and will receive
collateral in the form of cash or U.S. government securities equal to at least
100% of the value of the securities loaned. This policy cannot be changed
without the approval of holders of a majority of a Fund's shares.

There is the risk that when lending portfolio securities, the securities may not
be available to the Fund on a timely basis and the Fund may, therefore, lose the
opportunity to sell the securities at a desirable price. In addition, in the
event that a borrower of securities would file for bankruptcy or become
insolvent, disposition of the securities may be delayed pending court action.

Convertible Securities

The Stock Fund and the Small Company Stock Fund may invest in convertible
securities rated, at the time of purchase, BBB or better by S&P, Moody's, or
Fitch, or, if unrated, of comparable quality as determined by the Fund's
adviser. (If a security's rating is reduced below the required minimum after a
Fund has purchased it, the Fund is not required to sell the security, but may
consider doing so.) Convertible securities are fixed-income securities which may
be exchanged or converted into a predetermined number of the issuer's underlying
common stock at the option of the holder during a specified time period.
Convertible securities may take the form of convertible bonds, convertible
preferred stock or debentures, units consisting of "usable" bonds and warrants
or a combination of the features of several of these securities. The investment
characteristics of each convertible security vary widely, which allows
convertible securities to be employed for a variety of different investment
strategies.

Convertible bonds and convertible preferred stocks generally retain the
investment characteristics of fixed-income securities until they have been
converted but also react to movements in the underlying equity securities. The
prices of fixed-income securities fluctuate inversely to the direction of
interest rates. The holder is entitled to receive the fixed income of a bond or
the dividend preference of a preferred stock until the holder elects to exercise
the conversion privilege. Usable bonds are corporate bonds that can be used in
whole or in part, customarily at full face value, in lieu of cash to purchase
the issuer's common stock.

U.S. Government Securities

The U.S. government securities in which the Prime Money Market Fund, Stock Fund,
Small Company Stock Fund, and U.S. Government Securities Fund may invest
include: direct obligations of the U.S. Treasury (such as Treasury bills, notes
and bonds), and obligations issued by U.S. government agencies or
instrumentalities, including securities that are supported by the full faith and
credit of the United States (such as Government National Mortgage Association
certificates); securities that are supported by the right of the issuer to
borrow from the U.S. Treasury (such as securities of Federal Home Loan Banks);
and securities that are supported by the credit of the instrumentality (such as
Federal National Mortgage Association and Federal Home Loan Mortgage Corporation
bonds).

Equity Investment Considerations and Risk Factors

With respect to the Stock Fund and Small Company Stock Fund, as with other
mutual funds that invest primarily in equity securities, the Funds are subject
to market risks. Since equity markets tend to be cyclical, the possibility
exists that the value of common stocks could decline over short or even extended
periods of time.

With respect to the Small Company Stock Fund, because the Fund invests primarily
in small capitalization stocks, there are some additional risk factors
associated with investments in this Fund. Small capitalization stocks have
historically been more volatile in price than larger capitalization stocks, such
as those included in the Standard & Poor's 500 Index. This is because, among
other things, smaller companies have a lower degree of liquidity in the equity
market and tend to have a greater sensitivity to changing economic conditions.
Further, in addition to exhibiting greater volatility, these stocks may, to some
degree, fluctuate independently of the stocks of large companies. That is, the
stocks of small capitalization companies may decline in price as the price of
large company stocks rises or vice versa. Therefore, investors should expect
that there will be periods of time when the Fund will exhibit greater volatility
than broad stock market indices such as the Standard & Poor's 500 Index.

Put and Call Options

The Stock Fund, Small Company Stock Fund, and U.S. Government Securities Fund
may purchase put options on portfolio securities. A put option gives a Fund, in
return for a premium, the right to sell the underlying security to the writer
(seller) at a specified price during the term of the option. These options will
be used as a hedge to attempt to protect securities which a Fund holds against
decreases in value. These Funds may also write covered call options on all or
any portion of their portfolio to generate income. As a writer of a call option,
a Fund has the obligation upon exercise of the option during the option period
to deliver the underlying security upon payment of the exercise price. A Fund
will write call options on securities either held in its portfolio, or which it
has the right to obtain without payment of further consideration, or for which
it has segregated cash or U.S. government securities in the amount of any
additional consideration. The Funds may also purchase call options which give
the Funds the ability to purchase portfolio securities in the future at a price
specified in the call option.

A Fund may purchase and write over-the-counter options on portfolio securities
in negotiated transactions with the buyers or writers of the options when
options on the portfolio securities held by a Fund are not traded on an
exchange. A Fund purchases and writes options only with investment dealers and
other financial institutions (such as commercial banks or savings associations)
deemed creditworthy by the investment adviser.

Over-the-counter options are two-party contracts with price and terms negotiated
between buyer and seller. In contrast, exchange-traded options are third-party
contracts with standardized strike prices and expiration dates and are purchased
from a clearing corporation. Exchange-traded options have a continuous liquid
market while over-the-counter options may not.

Futures and Options on Futures

The Stock Fund, Small Company Stock Fund, and U.S. Government Securities Fund
may purchase and sell futures contracts to hedge against the effects of changes
in the value of portfolio securities due to anticipated changes in interest
rates and market conditions. Futures contracts call for the delivery of
particular debt instruments at a certain time in the future. The seller of the
contract agrees to make delivery of the type of instrument called for in the
contract and the buyer agrees to take delivery of the instrument at the
specified future time.

Stock index futures contracts are based on indexes that reflect the market value
of common stock of the firms included in the indexes. An index futures contract
is an agreement pursuant to which two parties agree to take or make delivery of
an amount of cash equal to the differences between the value of the index at the
close of the last trading day of the contract and the price at which the index
contract was originally written. The Stock Fund, Small Company Stock Fund, and
U.S. Government Securities Fund may also write call options and purchase put
options on futures contracts as a hedge to attempt to protect their portfolio
securities against decreases in value. When a Fund writes a call option on a
futures contract, it is undertaking the obligation of selling a futures contract
at a fixed price at any time during a specified period if the option is
exercised. Conversely, as purchaser of a put option on a futures contract, a
Fund is entitled (but not obligated) to sell a futures contract at the fixed
price during the life of the option.

The Stock Fund, Small Company Stock Fund, and U.S. Government Securities Fund
may purchase call options on futures contracts as hedges against rising purchase
prices of portfolio securities. These Funds will use these transactions to
attempt to protect their ability to purchase portfolio securities in the future
at price levels existing at the time they enter into the transactions. As a
purchaser of a call option on a futures contract, these Funds are entitled (but
not obligated) to purchase a futures contract at a fixed price at any time
during the life of the option.

The Stock Fund, Small Company Stock Fund, and U.S. Government Securities Fund
may not purchase or sell futures contracts or related options if immediately
thereafter the sum of the amount of margin deposits on a Fund's existing futures
positions and premiums paid for related options would exceed 5% of the market
value of a Fund's total assets. When a Fund purchases futures contracts, an
amount of cash and cash equivalents, equal to the underlying commodity value of
the futures contracts (less any related margin deposits), will be deposited in a
segregated account with the custodian (or the broker, if legally permitted) to
collateralize the position and thereby insure that the use of such futures
contracts are unleveraged. When a Fund sells futures contracts, it will either
own or have the right to receive the underlying future or security, or will make
deposits to collateralize the position as discussed above.

Risks

When a Fund uses futures and options on futures as hedging devices, there is a
risk that the prices of the securities subject to the futures contracts may not
correlate perfectly with the prices of the securities in that Fund's portfolio.
This may cause the futures contract and any related options to react differently
than the portfolio securities to market changes. In addition, the investment
adviser could be incorrect in its expectations about the direction or extent of
market factors such as stock price movements. In these events, a Fund may lose
money on the futures contract or option.

It is not certain that a secondary market for positions in futures contracts or
for options will exist at all times. Although the investment adviser will
consider liquidity before entering into these transactions, there is no
assurance that a liquid secondary market on an exchange or otherwise will exist
for any particular futures contract or option at any particular time. A Fund's
ability to establish and close out futures and options positions depends on this
secondary market.

Investing in Securities of
Other Investment Companies

The Funds may invest in the securities of other investment companies, but will
not own more than 3% of the total outstanding voting stock of any investment
company, invest more than 5% of total assets in any one investment company, or
invest more than 10% of total assets in investment companies in general unless
permitted to do so by order of the Securities and Exchange Commission. The Money
Market Funds may only invest in the securities of other investment companies
that are money market funds having investment objectives and policies similar to
their own. The Funds will invest in other investment companies primarily for the
purpose of investing short-term cash which has not yet been invested in other
portfolio instruments. Shareholders should realize that when a Fund invests in
other investment companies, certain Fund expenses, such as advisory fees,
custodian fees and administrative fees, may be duplicated. These limitations are
not applicable if the securities are acquired in a merger, consolidation,
reorganization, or acquisition of assets.

Demand Master Notes

The Prime Money Market Fund, Stock Fund, Small Company Stock Fund, and U.S.
Government Securities Fund may invest in variable amount demand master notes.
Demand notes are short-term borrowing arrangements between a corporation or
government agency and an institutional lender (such as a Fund) payable upon
demand by either party. The notice period for demand typically ranges from one
to seven days, and the party may demand full or partial payment. Many master
notes give a Fund the option of increasing or decreasing the principal amount of
the master note on a daily or weekly basis within certain limits. Demand master
notes usually provide for floating or variable rates of interest.

Foreign Investments

ADRs, ECDs, ETDs, Yankee CDs, Canadian Commercial Paper, Europaper, and foreign
debt obligations are subject to somewhat different risks than corresponding
securities of domestic issuers. Examples of these risks include international,
economic and political developments, foreign governmental restrictions that may
adversely affect the payment of dividends, principal or interest, foreign
withholding or other taxes on interest income, difficulties in obtaining or
enforcing a judgment against the issuer, and the possible impact of
interruptions in the flow of international currency transactions. Different
risks may also exist for ECDs, ETDs, and Yankee CDs because the banks issuing
these instruments, or their domestic or foreign branches, are not necessarily
subject to the same regulatory requirements that apply to domestic banks, such
as reserve requirements, loan limitations, examinations, accounting, auditing,
and recordkeeping, and the public availability of information. These factors
will be carefully considered by the investment adviser in selecting investments
for a Fund.

Temporary Investments

The Stock Fund, Small Company Stock Fund, and U.S. Government Securities Fund
may invest temporarily in cash and cash items during times of unusual market
conditions for defensive purposes (up to 100% of a Fund's respective total
assets) and to maintain liquidity (up to 35% of a Fund's respective total
assets). Cash items may include short-term obligations such as obligations of
the U.S. government or its agencies or instrumentalities and repurchase
agreements.

Riggs Funds Information

Management of Riggs Funds

Board of Trustees

The Trust is managed by a Board of Trustees (the "Trustees"). The Trustees are
responsible for managing the business affairs of the Trust and for exercising
all of the powers of the Trust except those reserved for the shareholders. The
Executive Committee of the Board of Trustees handles the Trustees'
responsibilities between meetings of the Board.

Investment Adviser

Pursuant to an investment advisory contract with the Trust, investment decisions
for the Trust are made by RIMCO, the Trust's investment adviser (the "Adviser"),
subject to direction by the Trustees. The Adviser continually conducts
investment research and supervision for each Fund and is responsible for the
purchase or sale of portfolio instruments, for which it receives an annual fee
from the assets of each Fund.

Advisory Fees

The Adviser receives an annual investment advisory fee at annual rates equal to
percentages of the relevant Fund's average net assets as follows: Prime Money
Market Fund and U.S. Treasury Money Market Fund - 0.50%; U.S. Government
Securities Fund and Stock Fund - 0.75%; and Small Company Stock Fund - 0.80%.
The fee paid by Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund, while higher than the advisory fee paid by other mutual funds
in general, is comparable to fees paid by other mutual funds with similar
investment objectives and policies. The investment advisory contract provides
for the voluntary waiver of expenses by the Adviser from time to time. The
Adviser can terminate this voluntary waiver of expenses at any time with respect
to a Fund at its sole discretion.

Adviser's Background

RIMCO is a subsidiary of Riggs Bank, which is a subsidiary of Riggs National
Corporation, a bank holding company. RIMCO has advised the Riggs Funds since
September 1991, and as of April 30, 1998, provides investment advice for assets
approximating 2.8 billion. RIMCO has a varied client base of over 100 other
relationships including corporate, union and public pension plans, foundations,
endowments and associations. As part of its regular banking operations, Riggs
Bank may make loans to public companies. Thus, it may be possible, from time to
time, for a Fund to hold or acquire the securities of issuers which are also
lending clients of Riggs Bank. The lending relationship will not be a factor in
the selection of securities.

Philip D. Tasho is the Chief Executive Officer and Chief Investment Officer of
RIMCO and served as the manager of the Stock Fund from its inception through
June 1994. Most recently, Mr. Tasho was a Vice President at Shawmut Investment
Advisers in Boston, MA from 1994 to 1995. Prior to that, Mr. Tasho served as a
Managing Director of RIMCO and was a member of the senior management committee
from 1990 to 1994. He also served as a Senior Portfolio Manager for the Sovran
Bank in Bethesda and as Director of Research for the same bank at its Richmond
head office. He started his career as a Trust Investment Officer for the First
American Bank in Washington. Mr. Tasho earned a B.A. in Russian from Grinnel
College and an M.B.A. in Finance and Investments from George Washington
University. He holds a CFA from the Institute of Chartered Financial Analysts.
Mr. Tasho assumed portfolio management responsibility of the Stock and Small
Company Stock Funds in November 1995.

Brian T. Shevlin is a Director of RIMCO and is responsible for fixed income
strategy and management. Mr. Shevlin has 16 years of diverse investment and
institutional asset management experience. He was a Managing Director serving as
a portfolio manager at 21st Century Investment Advisers from 1995 until joining
RIMCO in late 1996. Previously, he served as Vice President of Fixed Income at
Dewey Square Investors and its subsidiary HT Investors, in Boston, MA from 1993
to 1995. He brings additional asset/liability management experience from
positions with NCNB Texas Asset Management in Dallas, TX, the Student Loan
Marketing Association, and Hospital Trust National Bank. Mr. Shevlin earned a
B.S. degree in Finance from Providence College, Providence, RI. He assumed
portfolio management responsibilities of the Riggs U.S. Securities Fund in
September 1996.

Distribution of Shares of the Funds

Federated Securities Corp. is the principal distributor for shares of the Funds.
It is a Pennsylvania corporation organized on November 14, 1969, and is the
principal distributor for a number of investment companies. Federated Securities
Corp. is a subsidiary of Federated Investors, Inc.

Distribution Plan and Shareholder Services Plan

Pursuant to the provisions of the distribution plan adopted in accordance with
the Investment Company Act Rule 12b-1 (the "Plan"), the Class R Shares of the
Funds may pay to the distributor a fee computed at an annual rate of up to 0.25%
of the average daily net assets of the Class R Shares of the U.S. Government
Securities Fund, Stock Fund, and Small Company Stock Fund, and up and up to
0.50% of the average daily net assets of the Class R Shares of the Money Market
Funds to finance any activity which is principally intended to result in the
sale of shares. In addition, the Class B Shares of Stock Fund and Small Company
Stock Fund are subject to the Rule 12b-1 distribution fee as described under the
caption "Other Classes of Shares" and in a separate prospectus relating to Class
B Shares.

The classes of shares of each Fund represent interests in one common investment
portfolio but differ in that shares are subject to different distribution
expenses paid pursuant to the Plan. With respect to the Money Market Funds,
Class R Shares (which are subject to the distribution fee) are sold primarily to
retail customers of Riggs Bank through Riggs Bank and its affiliates, and to
other retail customers through non-affiliated, authorized broker/dealers. Class
R Shares of the Money Market Funds are also available to retail and
institutional investors in connection with an Asset Management Program for
automatic investment. Class Y Shares of the Money Market Funds (which are not
subject to the distribution fee) are sold primarily to trusts, fiduciaries and
institutions; and to persons and entities ("Class A Shareholders") who held
Class Y Shares (formerly known as "Class A Shares") on June 30, 1998.

Class R Shares of U.S. Government Securities Fund, Stock Fund, and Small Company
Stock Fund are sold primarily to retail and trust customers of Riggs Bank
through Riggs Bank and its affiliates. See "Other Classes of Shares" for a
description of Class B Shares of Stock Fund and Small Company Stock Fund.

The distributor may from time to time and for such periods as its deems
appropriate, voluntarily reduce its compensation under the Plan to the extent
the expenses attributable to the Class R Shares exceed such lower expense
limitation as the distributor may, by notice of the Trust, voluntarily declare
to be effective.

Under the Plan, the distributor may select financial institutions such as banks,
fiduciaries, custodians for public funds, investment advisers, and brokers to
provide sales services as agents for their clients or customers who beneficially
own Class R Shares of the Funds.

Financial institutions will receive fees from the distributor based upon shares
owned by their clients or customers. The schedules of such fees and the basis
upon which such fees will be paid will be determined from time to time by the
distributor.

The Plan is a compensation type plan. As such, the Class R Shares of the Funds
make no payments to the distributor except as described above. Therefore, the
Class R Shares of the Funds do not pay for unreimbursed expenses of the
distributor, including amounts expended by the distributor in excess of amounts
received by it from the Class R Shares of the Funds, interest, carrying or other
financing charges in connection with excess amounts expended, or the
distributor's overhead expenses. However, the distributor may be able to recover
such amounts or may earn a profit from future payments made by the Class R
Shares of the Funds under the Plan.

In addition the Trust has entered into a Shareholder Services Agreement with
Federated Shareholder Services, a subsidiary of Federated Investors, Inc., under
which all classes and series of the Funds may make payments up to 0.25% of the
average daily net asset value of a Fund's shares, computed at an annual rate to
obtain certain services for shareholders and to maintain shareholder accounts.
From time to time and for such periods as deemed appropriate, the amount stated
above may be reduced voluntarily. Under the Shareholder Services Agreement,
Federated Shareholder Services will either perform shareholder services directly
or will select financial institutions to perform shareholder services. Financial
institutions will receive fees based upon shares owned by their clients or
customers. The schedule of such fees and the basis upon which such fees will be
paid will be determined from time to time by the Trust and Federated Shareholder
Services.

The Glass-Steagall Act prohibits a depository institution (such as a commercial
bank or savings association) from being an underwriter or distributor of most
securities. In the event the Glass-Steagall Act is deemed to prohibit depository
institutions from acting in the administrative capacities described above or
should Congress relax current restrictions on depository institutions, the
Trustees will consider appropriate changes in the services.

Supplemental Payments to Financial Institutions

In addition to payments pursuant to the Distribution Plan and Shareholder
Services Agreement, Federated Securities Corp. and Federated Shareholder
Services, from their own assets, may pay financial institutions supplemental
fees for the performance of substantial sales services, distribution-related
support services, or shareholder services. The support may include sponsoring
sales, educational and training seminars for their employees, providing sales
literature, and engineering computer software programs that emphasize the
attributes of a Fund. Such assistance will be predicated upon the amount of
shares the financial institution sells or may sell, and/or upon the type and
nature of sales or marketing support furnished by the financial institution. Any
payments made by the distributor may be reimbursed by the Funds' investment
adviser or its affiliates.

Administration of the Funds

Administrative Services

Federated Services Company, a subsidiary of Federated Investors, Inc., provides
certain administrative personnel and services (including certain legal,
financial reporting and transfer agency services) necessary to operate the
Funds. Federated Services Company provides these services at an annual rate of
0.16% of the average daily net assets of the Trust. Federated Services Company
may voluntarily waive a portion of its fee.

Custodian

Riggs Bank, Washington, D.C., is custodian for the securities and cash of the
Funds. Under the Custodian Agreement, Riggs Bank holds the Funds' portfolio
securities in safekeeping and keeps all necessary records and documents relating
to its duties.

Net Asset Value

With respect to the Money Market Funds, each Fund attempts to stabilize the net
asset value of its shares at $1.00 by valuing its portfolio securities using the
amortized cost method. The net asset value per share of each class is determined
by adding the interest of a class of shares in the value of all securities and
other assets of a Fund, subtracting the liabilities of the Fund attributable to
that class of shares, and dividing the remainder by the number of shares
outstanding within that class. Of course, the Money Market Funds cannot
guarantee that their net asset value will always remain at $1.00 per share.

With respect to the Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund, net asset value per share fluctuates and is determined by
dividing the sum of the market value of all securities and other assets, less
liabilities, by the number of shares outstanding.

On Monday through Friday, the U.S. Treasury Money Market Fund and Prime Money
Market Fund calculate net asset value at 12:00 noon (Washington, D.C. time) and
4:00 p.m. (Washington, D.C. time), while the Stock Fund, Small Company Stock
Fund, and U.S. Government Securities Fund calculate net asset value at the close
of trading on the New York Stock Exchange, normally 4:00 p.m. (Washington, D.C.
time), except on: (i) days on which there are not sufficient changes in the
value of a Fund's portfolio securities that its net asset value might be
materially affected; (ii) days during which no shares of a Fund are tendered for
redemption and no orders to purchase shares are received; and (iii) on the
following holidays: New Year's Day, Martin Luther King Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.

Investing in the Funds

Share Purchases

Shares of the Funds are sold on days on which both the New York Stock Exchange
and the Federal Reserve Wire system are open for business. Shares of the Funds
may be purchased through Riggs Bank. In connection with the sale of shares of
the Funds, the distributor may from time to time offer certain items of nominal
value to any shareholder or investor. The Funds reserve the right to reject any
purchase request and will not accept any purchase request without having first
received a completed account application.

Through Riggs Bank

An investor may write to or call Riggs Bank at the number on the front page of
this prospectus to place an order to purchase shares of a Fund. Representatives
are available from 8:00 a.m. to 5:00 p.m. (Washington, D.C. time). Payment may
be made either by mail or federal funds or by debiting a customer's account at
Riggs Bank. With respect to U.S. Treasury Money Market Fund and Prime Money
Market Fund, purchase orders must be received by Riggs Bank before 11:00 a.m.
(Washington, D.C. time). Payment is normally required on the same business day.
With respect to Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund, purchase orders must be received by Riggs Bank before 4:00 p.m.
(Washington, D.C. time). Payment is normally required on the next business day.
Texas residents must purchase shares through Federated Securities Corp. at 1-
800-801-2143.

Payment for shares of a Fund may be made by check or by wire.

By Mail

To purchase shares of a Fund by mail, send a check made payable to "Riggs Funds"
(include name of Fund and "Class R" Shares) to Riggs Bank N.A., P.O. Box 96656,
Washington, D.C. 20090-6656. Orders by mail are considered received after
payment by check is converted by Riggs Bank into federal funds. This is normally
the next business day after Riggs Bank receives the check.

By Wire

To purchase shares of a Fund by wire, call the number on the front page of this
prospectus.

With respect to U.S. Treasury Money Market Fund and Prime Money Market Fund,
payment by wire must be received by Riggs Bank before 12:30 p.m. (Washington,
D.C. time) on the same day as the order is placed to earn dividends for that
day. With respect to Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund, payment by wire must be received by Riggs Bank before 3:00 p.m.
(Washington, D.C. time) on the next business day after placing the order. Shares
of the Funds cannot be purchased by Federal Reserve wire on Columbus Day,
Veterans' Day or Martin Luther King Day.

Through Riggs-Affiliated Broker/Dealers

An investor may place an order through Riggs-affiliated broker/dealers to
purchase shares of a Fund. Shares will be purchased at the public offering price
next determined after the Fund receives the purchase request from the
broker/dealer. Purchase requests through Riggs-affiliated broker/dealers must be
received by the broker/dealer before 3:00 p.m. (Washington, D.C. time) in order
for shares to be purchased at that day's public offering price.

Through Automatic Investing Programs Offered Through Riggs Bank (an "Automatic
Investment Program")

Cash accumulations in demand deposit accounts with Riggs Bank may be
automatically invested in the Class R Shares of Prime Money Market Fund or U.S.
Treasury Money Market Fund when the demand deposit account reaches a dollar
amount predetermined by Riggs Bank and its customer.

Prospective investors in an Automatic Investing Program should refer to the
Riggs Bank Service Agreement that will need to be established between the
investor and Riggs Bank for details regarding the services, fees, restrictions,
and limitations related to the Automatic Investing Program. This prospectus
should, therefore, be read together with the Riggs Bank Service Agreement.
Shareholders may apply for participation in this program through Riggs Bank.

Minimum Investment Required

With the exception of the Class R Shares of the Money Market Funds, the minimum
initial investment in each Fund is $1000, except for an Individual Retirement
Account ("IRA") which requires a minimum initial investment of $500. Subsequent
investments must be in amounts of at least $100, except for an IRA, which must
be in amounts of at least $50. An investor's minimum investment will be
calculated by combining all mutual fund accounts it maintains in the Riggs
Funds. The minimum investment requirements described above are not applicable to
Class R Shares of the Money Market Funds, for which the minimum investment
requirement, if any, would be specified in the Riggs Bank Service Agreement.

The minimum investment required may be waived for purchases by employees or
retirees of the Riggs National Corporation and/or its subsidiaries, and their
spouses and children under the age of 21. The minimum investment may also be
waived for investors participating in a payroll deduction program.

What Shares Cost

Shares of the Funds are sold at their net asset value next determined after an
order is received. There is no sales charge imposed by the Funds at the time of
purchase.

Systematic Investment Program

Once a Fund account has been opened, shareholders may add to their investment on
a regular basis in a minimum amount of $50. Under this program, funds may be
automatically withdrawn on a periodic schedule from the shareholder's checking
or savings account or an account in one of the Riggs Funds and invested in Fund
shares at the net asset value next determined after an order is received.
Shareholders may apply for participation in this program through Riggs Bank or
an authorized broker or dealer.

Due to the nature of the Automatic Investing Programs, systematic investment
privileges are unavailable to participants in these programs.

Retirement Plans

Shares of the Funds can be purchased as an investment for retirement plans or
for IRA accounts. For further details, contact Riggs Bank and consult a tax
adviser.

Confirmations and Account Statements

Shareholders will receive detailed confirmations of transactions. In addition,
shareholders will receive periodic statements reporting all account activity,
including dividends paid. The Funds will not issue share certificates.

Dividends

With respect to the Money Market Funds and U.S. Government Securities Fund,
dividends are declared daily and paid monthly. Unless shareholders request cash
payments by so indicating on the account application or by writing to one of
these Funds, dividends are automatically reinvested in additional shares of the
respective Fund on payment dates at net asset value on the ex-dividend date
without a sales charge.

With respect to the Stock Fund and Small Company Stock Fund, dividends are
declared and paid quarterly. Unless cash payments are requested by shareholders
in writing to the appropriate Fund or by indication on the account application,
dividends are automatically reinvested in additional shares of the Fund on
payment dates at the ex-dividend date net asset value without a sales charge.

Capital Gains

Capital gains realized by a Fund, if any, will be distributed at least once
every 12 months.

Exchanges

A shareholder may generally exchange Class R Shares of one Fund for Class R
Shares of any of the other Funds in the Trust (with the exception of Prime Money
Market Fund) by calling the number on the front page of this prospectus, or by
writing to Riggs Bank. Shares purchased by check are eligible for exchange. A
contingent deferred sales charge ("CDSC") is not assessed in connection with
such exchanges, but if the shareholder redeems shares (other than shares of a
Money Market Fund, unless the Money Market Fund Shares were acquired in exchange
for Class R Shares or Class B Shares [see "Other Class of Shares"] of a Fund
which is not a Money Market Fund) within five years of the original purchase, a
CDSC will be imposed. For purposes of computing the CDSC, the length of time the
shareholder has owned shares will be measured from the date of original purchase
and will not be affected by the exchange.

Orders to exchange shares of one Fund for shares of any of the other Funds will
be executed by redeeming the shares owned and purchasing shares of any of the
other Funds at the net asset value determined after the exchange request is
received. Orders for exchanges received by a Fund prior to 4:00 p.m.
(Washington, D.C. time) on any day that Fund is open for business will be
executed as of the close of business that day. Orders for exchanges received
after 4:00 p.m. (Washington, D.C. time) on any business day will be executed at
the close of the next business day.

An authorization form permitting a Fund to accept telephone exchange requests
must first be completed. It is recommended that investors request this privilege
on the account application at the time of their initial application. If not
completed at the time of initial application, authorization forms and
information on this service can be obtained through Riggs Bank. Telephone
exchange instructions may be recorded. If reasonable procedures are not followed
by the Fund, it may be liable for losses due to unauthorized or fraudulent
telephone instructions.

In the case where the new account registration is not identical to that of the
existing account, a signature guarantee is required. (See "Redeeming Shares By
Mail.") Exercise of this privilege is treated as a sale for federal income tax
purposes and, depending on the circumstances, a short- or long-term capital gain
or loss may be realized. The Funds reserve the right to modify or terminate the
exchange privilege at any time. Shareholders will be notified prior to any
modification or termination of this privilege. Shareholders may obtain further
information on the exchange privilege by calling Riggs Funds Shareholder
Services at (301) 887-4280 or outside the Washington, D.C. metropolitan area
toll-free 1-800-934-3883.

An excessive number of exchanges may be disadvantageous to the Trust. Therefore,
the Trust, in addition to its right to reject any exchange, reserves the right
to modify or terminate the exchange privilege at any time. Shareholders would be
notified prior to any modification or termination.

An exchange order must comply with the requirements for a redemption and must
specify the dollar value or number of shares to be exchanged. Exchanges are
subject to the minimum initial investment requirement of the Fund being
acquired. An exchange constitutes a sale for federal income tax purposes.

Due to the nature of the Automatic Investing Programs, exchange privileges are
unavailable to participants in those programs.

Systematic Exchange Program

Shareholders who desire to automatically exchange shares of a predetermined
amount on a monthly, quarterly or annual basis may take advantage of a
systematic exchange privilege. The minimum amount that may be exchanged is $50.
This privilege is not available to shareholders of Class R Shares of the Money
Market Funds. Shareholders interested in participating in this program should
contact Riggs Funds Shareholder Services for more information.

Redeeming Shares

Each Fund redeems Class R Shares and Class Y Shares at their net asset value,
less, in the case of Class R Shares (with the exception of the Money Market
Funds, unless the Money Market Fund shares were acquired in exchange for Class R
Shares or Class B Shares of a Fund which is not a Money Market Fund), any
applicable CDSC, next determined after Riggs Bank receives the redemption
request.

Redemptions will be made on days on which both the New York Stock Exchange and
Federal Reserve Wire system are open for business. Telephone or written requests
for redemption must be received in proper form by Riggs Bank.

Automatic Investing Programs

Clients of Riggs Bank who have executed a Riggs Bank Service Agreement should
refer to the Agreement for information about redeeming Class R Shares of Prime
Money Market Fund and U.S. Treasury Money Market Fund purchased through that
program.

By Telephone

A shareholder may redeem shares of a Fund by calling the number on the front
page of this prospectus. Shares will be redeemed at the net asset value next
determined after a Fund receives the redemption request from Riggs Bank.
Although Riggs Bank does not charge for telephone redemptions, it reserves the
right to charge a fee for the cost of wire-transferred redemptions of less than
$5,000, or in excess of one per month.

With respect to the Money Market Funds, redemption requests received before
11:00 a.m. (Washington, D.C. time) will be wired the same day, but will not be
entitled to that day's dividend. Riggs Bank is responsible for promptly
submitting redemption requests and providing proper written redemption
instructions to a Fund. If, at any time, a Fund should determine it necessary to
terminate or modify this method of redemption, shareholders would be promptly
notified. With respect to the Stock Fund, Small Company Stock Fund, and U.S.
Government Securities Fund, a redemption request must be received by Riggs Bank
before 4:00 p.m. (Washington D.C. time) in order for shares to be redeemed at
that day's net asset value.

An authorization form permitting a Fund to accept telephone redemption requests
must first be completed. It is recommended that investors request this privilege
at the time of their initial application. If not completed at the time of
initial application, authorization forms and information on this service can be
obtained through Riggs Bank. Telephone redemption instructions may be recorded.
If reasonable procedures are not followed by the Fund, it may be liable for
losses due to unauthorized or fraudulent telephone instructions.

In the event of drastic economic or market changes, a shareholder may experience
difficulty in redeeming by telephone. If such a case should occur, another
method of redemption, such as by mail, should be considered.

By Mail

Shareholders may redeem shares of a Fund by sending a written request to Riggs
Bank N.A., P.O. Box 96656, Washington, D.C. 20090-6656. The written request
should include the shareholder's name, the Fund name, the account number, and
the share or dollar amount requested, and should be signed by each registered
owner exactly as the shares are registered. If share certificates have been
issued, they must be properly endorsed and should be sent by registered or
certified mail with the written request to Riggs Bank.

Shareholders requesting a redemption of any amount to be sent to an address
other than that on record with a Fund, or a redemption payable other than to the
shareholder of record must have signatures on written redemption requests
guaranteed by:

. a trust company or commercial bank whose deposits are insured by BIF, which
is administered by the Federal Deposit Insurance Corporation ("FDIC");

. a member of the New York, American, Midwest, or Pacific Stock Exchange;

. a savings bank or savings association whose deposits are insured by SAIF,
which is administered by the FDIC; or

. any other "eligible guarantor institution," as defined in the Securities
Exchange Act of 1934.

The Funds do not accept signatures guaranteed by a notary public.

The Trust and its transfer agent have adopted standards for accepting signature
guarantees from the above institutions. The Trust may elect in the future to
limit eligible signature guarantors to institutions that are members of a
signature guarantee program. The Trust and its transfer agent reserve the right
to amend these standards at any time without notice.

Normally, a check for the proceeds is mailed to the shareholder within one
business day, but in no event more than seven days, after receipt of a proper
redemption request by mail or by wire. Upon shareholder request, the proceeds
may be credited to an account at Riggs Bank.

Checkwriting

Class R shareholders, and Class Y shareholders who at June 30, 1998 were Class A
shareholders, of U.S. Treasury Money Market Fund and Prime Money Market Fund
with a minimum balance of $5,000 can redeem shares by writing a check in the
amount of at least $100. Shareholders must complete the checkwriting section of
the account application or complete a subsequent checkwriting application form
which can be obtained from Riggs Bank. The Fund will then provide checks. Checks
cannot be used to close a shareholder's account. Checkwriting is not permitted
with respect to shares held in IRA accounts, corporate accounts, or an Automatic
Investing Program. For further information, contact Riggs Funds Shareholder
Services.

Systematic Withdrawal Program

Shareholders who desire to receive payments of a predetermined amount may take
advantage of the Systematic Withdrawal Program. Once a Fund account has been
opened, shareholders may withdraw from their investment on a regular basis in a
minimum amount of $50. Under this program, Fund shares are redeemed at net asset
value, less any applicable CDSC, to provide for periodic withdrawal payments in
an amount directed by the shareholder. In addition, shareholders may make
arrangements to have amounts systematically withdrawn from their accounts in the
Money Market Funds and automatically invested in Class R Shares of one of the
other Funds in the Riggs Funds. Depending upon the amount of the withdrawal
payments, the amount of dividends paid and capital gains distributions with
respect to Fund shares, and the fluctuation of the net asset value of Fund
shares redeemed under this program, redemptions may reduce, and eventually
deplete, the shareholder's investment in the Fund. For this reason, payments
under this program should not be considered as yield or income on the
shareholder's investment in the Fund. To be eligible to participate in this
program, a shareholder must have an account value of at least $10,000. A
shareholder may apply for participation in this program through Riggs Bank or an
authorized broker or dealer.

Due to the nature of the Automatic Investment Programs, systematic withdrawal
privileges are not available to participants in those programs.

Contingent Deferred Sales Charge

Shareholders redeeming Class R Shares from the Funds (with the exception of the
Money Market Funds, unless the Money Market Fund Shares were acquired in
exchange for Class R Shares or Class B Shares of a Fund which is not a Money
Market Fund) within five years of the purchase date will be charged a CDSC equal
to 2.00% or the lesser of the net asset value of the redeemed shares at the time
of purchase or the net asset value of the redeemed shares at the time of
redemption. The CDSC will be deducted from the redemption proceeds otherwise
payable to the shareholder and will be retained by the distributor. Redemptions
will be processed in a manner intended to maximize the amount of redemption
which will not be subject to a CDSC. The CDSC will not be imposed with respect
to shares acquired through the reinvestment of dividends or distributions of
long-term capital gains or with respect to shares acquires prior to July 1, 1998
(including shares acquired in exchange for shares acquires prior to July 1,
1998). In determining the applicability of the CDSC, the required holding period
for new shares received through an exchange will include the period for which
the original shares were held.

Eliminating the Contingent Deferred Sales Charge

Upon written notification to Federated Securities Corp. or the transfer agent,
no contingent deferred sales charge will be imposed
on redemptions:

. following the death or disability, as defined in Section 72(m)(7) of the
Internal Revenue Code of 1986, of the last surviving
shareholder;

. representing minimum required distributions from an Individual Retirement
Account or other retirement plan to a shareholder who has attained the age of
70 1/2;

. which are involuntary redemptions of shareholder accounts that do not comply
with the minimum balance requirements;

. which are qualifying redemptions of shares under a Systematic Withdrawal
Program;

. of shares held by Trustees, employees and retired employees of the Funds,
Riggs National Corporation and/or its subsidiaries, or Federated Securities
Corp. and/or its affiliates, and their spouses and children under the age of
21;

. of shares originally purchased (i) through the Trust Division or the Private
Banking Division of Riggs Bank; (ii) through an investment adviser registered
under the Investment Advisers Act of 1940; (iii) through retirement plans
where the third party administrator has entered into certain arrangements
with Riggs Bank or its affiliates; or (iv) by any bank or dealer (in each
case for its own account)having a sales agreement with Federated Securities
Corp.; and

. of shares purchased through entities having no transaction fee agreements or
wrap accounts with Riggs Bank or its affiliates.

For more information regarding any of the above provisions, contact Riggs Bank
or the Funds. The Funds reserve the right to discontinue or modify these
provisions. Shareholders will be notified of such action.

Accounts with Low Balances

Due to the high cost of maintaining accounts with low balances, the Fund may
redeem shares in any account and pay the proceeds to the shareholder if the
account balance falls below the required minimum value of $1,000 due to
shareholder redemptions. Before shares are redeemed to close an account, the
shareholder is notified in writing and allowed 30 days to purchase additional
shares to meet the minimum requirement. The required minimum value may be waived
for employees or retirees of the Riggs National Corporation and/or its
subsidiaries, employees of any broker/dealer operating on the premises of Riggs
Bank, and their spouses and children under 21.

Shareholder Information

Voting Rights

Each share of a Fund gives the shareholder one vote in Trustee elections and
other matters submitted to shareholders for vote. All shares of each Fund in the
Trust have equal voting rights, except that in matters affecting only a
particular Fund or class only shareholders of that Fund or class are entitled to
vote. As a Massachusetts business trust, the Trust is not required to hold
annual shareholder meetings. Shareholder approval will be sought only for
certain changes in the operation of the Trust or a Fund and for the election of
Trustees under certain circumstances. As of June 22, 1998, Riggs Bank may for
certain purposes be deemed to control the Funds because it is owner of record of
certain shares of the Funds.

Trustees may be removed by the trustees or by shareholders at a special meeting.
A special meeting of the shareholders shall be called by the trustees upon the
written request of shareholders owning at least 10% of the trust's outstanding
shares.

Effect of Banking Laws

The Glass-Steagall Act and other banking laws and regulations presently prohibit
a bank holding company registered under the Bank Holding Company Act of 1956 or
any affiliate thereof from sponsoring, organizing or controlling a registered,
open-end investment company continuously engaged in the issuance of its shares,
and from issuing, underwriting, selling or distributing securities in general.
Such laws and regulations do not prohibit such a holding company or affiliate
from acting as investment adviser, transfer agent, or custodian to such an
investment company or from purchasing shares of such a company as agent for and
upon the order of their customers. Riggs Bank, its parent, Riggs National
Corporation, and Riggs affiliates are broadly subject to these requirements.

Riggs Bank believes that it and its affiliates may perform those services for
the Trust contemplated by those agreements entered into between them and the
Trust without violating the laws or regulations referred to above. Changes in
either federal or state statutes and regulations relating to the permissible
activities of banks and their subsidiaries or affiliates, as well as further
judicial or administrative decisions or interpretations of present or future
statutes and regulations, could prevent these entities from continuing to
perform all or a part of the above services. If this happens, the Trustees would
consider alternative means of continuing available services. It is not expected
that shareholders would suffer any adverse financial consequences as a result of
any of these occurrences.

Tax Information
Federal Income Tax

The Funds anticipate that they will pay no federal income tax because each Fund
expects to meet requirements of the Internal Revenue Code applicable to
regulated investment companies and to receive the special tax treatment afforded
to such companies.

Each Fund will be treated as a single, separate entity for federal income tax
purposes so that income (including capital gains) and losses realized by a Fund
will not be combined for tax purposes with those realized by any of the other
Funds.

Unless otherwise exempt, shareholders are required to pay federal income tax on
any dividends and other distributions received. This applies whether dividends
and distributions are received in cash or as additional shares. Shareholders are
urged to consult their own tax advisers regarding the status of their accounts
under state and local tax laws.

Performance Information

From time to time the Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund may advertise total return and all of the Funds may advertise
yield. The Money Market Funds may also advertise effective yield.

Total return represents the change, over a specified period of time, in the
value of an investment in a Fund after reinvesting all income and capital gains
distributions. It is calculated by dividing that change by the initial
investment and is expressed as a percentage.

The yields of the Money Market Funds represent the annualized rate of income
earned on an investment in a Fund over a seven-day period. It is the annualized
dividends earned during the period on the investment, shown as a percentage of
the investment. The effective yield is calculated similarly to the yield, but,
when annualized, the income earned on an investment in a Fund is assumed to be
reinvested daily. The effective yield will be slightly higher than the yield
because of the compounding effect of this assumed reinvestment.

The yields of the Stock Fund, Small Company Stock Fund, and U.S. Government
Securities Fund are calculated by dividing the net investment income per share
(as defined by the Securities and Exchange Commission) earned by the Fund over a
thirty-day period by the maximum offering price per share of the Fund on the
last day of the period. This number is then annualized using semi-annual
compounding. The yield does not necessarily reflect income actually earned by
the Fund and, therefore, may not correlate to the dividends or other
distributions paid to shareholders.

Performance will be calculated separately for Class R Shares and Class Y Shares.

From time to time, advertisements for the Funds may refer to ratings, rankings,
and other information in certain financial publications and/or compare the
Funds' performance to certain indices.

Other Class of Shares

Stock Fund and Small Company Stock Fund also offer another class of shares
called Class B Shares.

Class B Shares are sold at net asset value, and are redeemed at net asset value
less any applicable CDSC of up to 5% of the lesser of (i) the net asset value of
the redeemed shares at the time of purchase or (ii) the net asset value of the
redeemed shares at the time of redemption. Class B Shares are sold primarily to
retail customers through broker/dealers which are not affiliated with Riggs
Bank. The minimum initial investment is $1000.

All classes are subject to certain of the same expenses. Class B Shares are
subject to Rule 12b-1 fees at an annual rate of up to 0.75% of the average daily
net assets, and are subject to shareholder services fees at an annual rate of up
to 0.25% of the average daily net assets. Expense differences between classes
may affect the performance of each class.

To obtain more information and a prospectus for Class B Shares, investors may
call (301) 887-4280, or outside the Washington, D.C. metropolitan area,
toll-free 1-800-934-3883.

Riggs U.S. Treasury
Money Market Fund
Class R Shares
Class Y Shares

Riggs Prime Money
Market Fund
Class R Shares
Class Y Shares

Riggs U.S. Government Securities Fund
Class R Shares

Riggs Stock Fund
Class R Shares

Riggs Small Company
Stock Fund
Class R Shares
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

Distributor
Federated Securities Corp.
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-37

Investment Adviser
Riggs Investment Management Corp.
800 17th Street N.W.
Washington, D.C. 20006

Custodian
Riggs Bank N.A.
Riggs Funds
5700 RiverTech Court
Riverdale, MD 20737-1250

Transfer Agent, Dividend Disbursing Agent,
and Portfolio Accounting Services
Federated Shareholder
Services Company
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

Independent Auditors
Ernst & Young LLP
One Oxford Centre
Pittsburgh, Pennsylvania 15219

Cusip 76656A 104 Cusip 76656A 203 Cusip 76656A 302 Cusip 76656A 500 Cusip 76656A
609 Cusip 76656A 807 Cusip 76656A 401 1061803A (6/98)

Combined Prospectus

June 30, 1998

Class B Shares
Riggs Stock Fund
Riggs Small Company Stock Fund
(formerly RIMCO Small Capitalization
Equity Fund)

Federated Securities Corp., Distributor
(formerly RIMCO Monument Funds)

Riggs Funds

(Formerly, RIMCO Monument Funds)

Class B Shares

Combined Prospectus

Riggs Funds (the "Trust"), an open-end management investment company (a mutual
fund), offers investors interests in five separate investment portfolios, each
having a distinct investment objective and policies.

This prospectus relates only to Class B Shares of Riggs Stock Fund and Riggs
Small Company Stock Fund (together, the "Funds").

Prospectus dated June 30, 1998

<TABLE>
TABLE OF CONTENTS
<S> <C>
Summary of Fund Expenses................................ 2
Synopsis................................................ 3
Objective of Each Fund.................................. 3
Stock Fund............................................. 3
Small Company Stock Fund............................... 4
Portfolio Investments and Strategies.................... 5
Borrowing Money........................................ 5
Diversification........................................ 5
Restricted and Illiquid Securities..................... 5
Repurchase Agreements.................................. 5
When Issued and Delayed Delivery Transactions.......... 6
Lending of Portfolio Securities........................ 6
Convertible Securities................................. 6
U.S. Government Securities............................. 6
Equity Investment Considerations and Risk Factors...... 6
Put and Call Options................................... 6
Futures and Options on Futures......................... 7
Investing in Securities of Other Investment Companies.. 7
Demand Master Notes.................................... 7
Foreign Investments.................................... 7
Temporary Investments.................................. 8
Riggs Funds Information................................. 8
Management of Riggs Funds.............................. 8
Distributions of Class B Shares of the Funds........... 8
Administration of the Funds............................ 9
Net Asset Value......................................... 9
Investing in Class B Shares of the Funds................ 9
Share Purchases........................................ 9
Minimum Investment Required............................ 9
What Shares Cost....................................... 9
Systematic Investment Program.......................... 9
Retirement Plans....................................... 9
Conversion of Class B Shares........................... 9
Confirmations and Account Statements................... 10
Dividends.............................................. 10
Capital Gains.......................................... 10
Exchanges............................................... 10
Systematic Exchange Program............................ 10
Redeeming Class B Shares................................ 10
Systematic Withdrawal Program.......................... 11
Contingent Deferred Sales Charge....................... 11
Eliminating the Contingent Deferred Sales Charge....... 11
Accounts with Low Balances............................. 11
Shareholder Information................................. 12
Voting Rights.......................................... 12
Effect of Banking Laws.................................. 12
Tax Information......................................... 12
Federal Income Tax..................................... 12
Performance Information................................. 12
Other Class of Shares................................... 12
Financial Highlights--Class R Shares.. ................ 14
Addresses............................................... 16

</TABLE>

SUMMARY OF FUND EXPENSES

Shareholder Transaction Expenses
Class B Shares
<TABLE>
<CAPTION>
Small
Company Stock
Stock Fund Fund
<S> <C> <C>
Maximum Sales Charge Imposed on Purchases (as a percentage of offering price) None None
Maximum Sales Charge Imposed on Reinvested Dividends (as a percentage of offering price) None None
Contingent Deferred Sales Charge (as a percentage of original
purchase price or redemption proceeds, as applicable)(1) 5.00% 5.00%
Redemption Fees (as a percentage of amount redeemed, if applicable) None None
Exchange Fee None None
</TABLE>
Annual Operating Expenses
(As a percentage of average net assets)
<TABLE>
<S> <C> <C>
Management Fee 0.80% 0.75%
12b-1 Fees 0.75% 0.75%
Other Expenses 0.38% 0.25%
Shareholder Servicing Fee (after waiver)(2) 0.00% 0.00%
Total Annual Operating Expenses(3) 1.93% 1.75%
</TABLE>
(1) The contingent deferred sales charge for Class B Shares is 5.00% in the
first year declining to 1.00% in the fifth year and 0.00% thereafter. (See
"What Shares Cost".)
(2) The shareholder servicing fee of each Fund has been reduced to reflect the
voluntary waiver by the shareholder servicing agent. The shareholder servicing
agent can terminate this voluntary waiver of expenses at any time at its sole
discretion. With respect to each Fund the maximum shareholder servicing fee is
0.25%
(3) Expenses in this table are estimated based on expenses expected during the
fiscal year ending April 30, 1999. Actual expenses may be more or less than
the amount shown.

Long-term shareholders may pay more than the economic equivalent of the maximum
front-end sales charges permitted under the rules of the National Association of
Securities Dealers, Inc.

<TABLE>
<CAPTION>
Small
Company Stock
Example Stock Fund Fund
<S> <C> <C>
You 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.
1 Year $ 74 $72
3 Years $101 $96
You would pay the following expenses on the same investment, assuming no redemptions.
1 Year $ 22 $20
3 Years $ 68 $63
</TABLE>

The above example should not be considered a representation of past or future
expenses. Actual expenses may be greater or less than those shown. This example
is based on estimated data for the Fund's fiscal year ending April 30, 1999.

Stock Fund and Small Company Stock Fund also offer another class of shares,
called Class R Shares, which are sold primarily to retail customers of Riggs
Bank through Riggs Bank and its affiliates. Class R Shares are subject to lower
contingent deferred sales charges and Rule 12b-1 fees than are Class B Shares.
See "Other Class of Shares."

Synopsis

As of the date of this prospectus, the Trust is comprised of the following five
portfolios:

. Riggs U.S. Treasury Money Market Fund ("U.S. Treasury Money Market Fund")--
seeks to provide current income consistent with stability of principal and
liquidity by investing in U.S. Treasury obligations. Shares of U.S. Treasury
Money Market Fund are issued in two separate classes: Class R Shares and
Class Y Shares.

. Riggs Prime Money Market Fund ("Prime Money Market Fund")--seeks to provide
current income consistent with stability of principal and liquidity by
investing exclusively in a portfolio of money market instruments maturing in
13 months or less. Shares of Prime Money Market Fund are issued in two
separate classes: Class R Shares and Class Y Shares.

. Riggs U.S. Government Securities Fund ("U.S. Government Securities
Fund")--seeks to achieve current income by investing in a diversified
portfolio limited primarily to U.S. government securities. Shares of U.S.
Government Securities Fund are issued in a single class: Class R Shares.

. Riggs Stock Fund ("Stock Fund")--seeks to provide growth of capital and
income primarily through equity investments such as common stocks and
securities convertible into common stocks. Shares of Stock Fund are issued
in two separate classes: Class R Shares and Class B Shares.

. Riggs Small Company Stock Fund ("Small Company Stock Fund")--seeks to
provide long-term capital appreciation through equity securities of
companies that have a market value capitalization of up to $1 billion.
Shares of Small Company Stock Fund are issued in two separate classes: Class
R Shares and Class B Shares.

For information on how to purchase shares of any of the Funds please refer to
"Investing in the Funds." In most cases, a minimum initial investment of $1000
is required for each Fund. In most cases, subsequent investments must be in
amounts of at least $100. See "Minimum Investment Required." Class B Shares are
sold at net asset value without a sales charge, and are redeemed at net asset
value, less a contingent deferred sales charge, as applicable. Information on
redeeming Class B Shares can be found under "Redeeming Shares" and "Contingent
Deferred Sales Charge." The Funds are advised by Riggs Investment Management
Corp.

Risk Factors

Investors should be aware of the following general considerations. The market
value of fixed-income securities may vary inversely in response to changes in
prevailing interest rates. The market value of the equity securities, which
constitute a major part of the investments of Stock Fund and Small Company Stock
Fund, will also fluctuate, and the possibility exists that the value of common
stocks could decline over short or even extended periods of time. The section
entitled "Equity Investment Considerations and Risk Factors" also discloses the
potential risks related to small capitalization stocks. The foreign securities
in which several Funds may invest may be subject to certain risks in addition to
those inherent in U.S. investments. One or more Funds may make certain
investments and employ certain investment techniques that involve other risks,
including entering into repurchase agreements, lending portfolio securities and
entering into futures contracts and related options as hedges. These risks and
those associated with investing in mortgage-backed securities, when-issued
securities, options and variable rate securities are described under "Objective
of Each Fund" and "Portfolio Investments and Strategies."

Year 2000 Statement

OBJECTIVE OF EACH FUND

Unless indicated otherwise, the investment policies of a Fund

may be changed by the Trustees without approval of shareholders. Shareholders
will be notified before any material change in these policies becomes effective.

Stock Fund

Acceptable Investments
The securities in which the Fund invests include, but are not limited to:

. preferred stocks, corporate bonds, notes, warrants, and rights;

. American Depositary Receipts ("ADRs"), which are receipts typically issued
by an American bank or trust company that evidences ownership of underlying
securities issued by a foreign issuer. ADRs may not necessarily be
denominated in the same currency as the securities into which they may be
converted. Generally, ADRs, in registered form, are designed for use in U.S.
securities markets. The Fund may invest up to 20% of its net assets in ADRs;

. commercial paper rated A-1 by Standard & Poor's (S&P),
Prime-1 by Moody's Investor Services, Inc. (Moody's) or F-1+ or F-1 by Fitch
and money market instruments (including commercial paper) which are unrated
but deemed to be of comparable quality by the investment adviser, including
Canadian Commercial Paper and Europaper;

. certificates of deposit, demand and time deposits, savings shares, bankers
acceptances and other instruments of domestic and foreign banks, savings
associations and other deposit or thrift institutions ("Bank Instruments")
having capital surplus and undivided profits over $100 million or insured by
the Bank Insurance Fund ("BIF") or the Savings Association Insurance Fund
("SAIF"). Bank Instruments may include Eurodollar Certificates of Deposit
("ECDs"), Yankee Certificates of Deposit ("Yankee CDs") and Eurodollar Time
Deposits ("ETDs"). The Fund will treat securities credit-enhanced with a
bank's letter of credit as Bank Instruments; and

In addition, the Fund may borrow money, lend portfolio securities, invest in
restricted and illiquid securities, repurchase agreements, securities of other
investment companies, and variable amount demand master notes and engage in put
and call options, futures and options on futures and when-issued and delayed
delivery transactions. See "Portfolio Investments and Strategies."

The relative price action of each stock is monitored, and price momentum is
followed to determine when the value of a security is beginning to be recognized
by the market.

Portfolio Turnover

Although the Fund does not intend to invest for the purpose of seeking
short-term profits, securities in its portfolio will be sold whenever the Fund's
investment adviser believes it is appropriate to do so in light of the Fund's
investment objective, without regard to the length of time a particular security
may have been held. It is not anticipated that the portfolio trading engaged in
by the Fund will result in its annual rate of portfolio turnover exceeding 200%.
A portfolio turnover rate of 100% would occur, for example, if all the
securities in the Fund's portfolio were replaced once in a period of one year.
The Fund's rate of portfolio turnover may exceed that of certain other mutual
funds with the same investment objective. A higher rate of portfolio turnover
involves correspondingly greater brokerage commissions and other expenses which
must be borne directly by the Fund and, thus, indirectly by its shareholders. In
addition, a high rate of portfolio turnover may result in the realization of
larger amounts of capital gains which, when distributed to the Fund's
shareholders, are taxable to them. Nevertheless, transactions for the Fund's
portfolio will be based only upon investment considerations and will not be
limited by any other considerations when the Fund's investment adviser deems it
appropriate to make changes in the Fund's portfolio.

Investment Limitations
The Fund's investment limitations are discussed below under "Borrowing Money,"
"Diversification," and "Restricted and Illiquid Securities."

Small Company Stock Fund

Acceptable Investments
The securities in which the Fund invests include, but are not limited to:

. preferred stocks, real estate investment trusts, corporate bonds, notes,
warrants, and rights;

. ADRs of foreign companies as described above under "Stock Fund--Acceptable
Investments;"

. instruments of domestic and foreign banks and savings
associations as described under "Stock Fund--Acceptable Investments;" and

While the Fund will only purchase corporate debt obligations that, at the time
of purchase, are rated in the top three rating categories, in the event that any
such security is downgraded to the fourth category, the Fund may continue to
hold the security. Obligations rated in the lowest of the top four ratings, such
as a by Moody's or BBB by S&P or Fitch, have speculative characteristics.
Changes in economic conditions or other circumstances are more likely to lead to
weakened capacity to make principal and interest payments than higher rated
bonds. In the event that any such security is downgraded by a ratings service
below the fourth highest rating category, the Fund will dispose of the security.

In selecting investments for the Fund, the investment adviser employs the same
value-based, disciplined investment philosophy that is described above with
respect to the Stock Fund, and applies it small capitalization sector of the
equity market. Using a computer model and hands-on fundamental analysis, small
capitalization stocks are selected based on such factors as low price/earnings
ratios relative to earnings growth and history; rising earnings estimates;
relative price strength; high or improving earnings; and credit quality.

The relative price action of each small capitalization stock is monitored, and
price momentum is followed to determine when the value of a security is
beginning to be recognized by the market.

In addition, the Fund may borrow money, lend portfolio securities, invest in
restricted and illiquid securities, repurchase agreements, securities of other
investment companies, and engage in when-issued and delayed delivery
transactions. The Fund may also invest in put and call options, futures, and
options on futures, for hedging purposes. See "Portfolio Investments and
Strategies" for a discussion of these investments as well as the potential risks
related to small capitalization stocks. The Fund's investments in real estate
investment trusts may be subject to risks associated with direct ownership of
real estate, including declines in the value of real estate, risks related to
general and local economic conditions, increases in interest rates, and other
factors discussed under this heading in the Statement of Additional Information.

Investment Limitations
The Fund's investment limitations are discussed below under "Borrowing Money,"
"Diversification," and "Restricted and Illiquid Securities."

PORTFOLIO INVESTMENTS AND STRATEGIES

Borrowing Money

The Funds will not borrow money directly or through reverse repurchase
agreements (arrangements in which a Fund sells a money market instrument for a
percentage of its cash value with an agreement to buy it back on a set date) or
pledge securities except, under certain circumstances, a Fund may borrow money
up to one-third of the value of its total assets and pledge up to 15% of the
value of those assets to secure such borrowings. This policy cannot be changed
without the approval of holders of a majority of a Fund's shares.

Diversification

With respect to 75% of the value of total assets, the Funds will not invest more
than 5% in securities of any one issuer other than cash, cash items or
securities issued or guaranteed by the government of the United States or its
agencies or instrumentalities and repurchase agreements collateralized by U.S.
government securities. The Funds will not acquire more than 10% of the
outstanding voting securities of any one issuer. This policy cannot be changed
without the approval of holders of a majority of a Fund's shares.

Restricted and Illiquid Securities

The Funds may invest in restricted securities. Restricted securities are any
securities in which a Fund may invest pursuant to its investment objective and
policies but which are subject to restriction on resale under federal securities
law. The Funds will limit investments in illiquid securities (including certain
restricted securities not determined by the Trustees to be liquid, nonnegotiable
time deposits, over-the-counter options, and repurchase agreements providing for
settlement in more than seven days after notice) to 15% of their net assets.

Repurchase Agreements

When-Issued and Delayed Delivery Transactions

Lending of Portfolio Securities

Convertible Securities

The Funds may invest in convertible securities rated, at the time of purchase,
BBB or better by S&P, Moody's, or Fitch, or, if unrated, of comparable quality
as determined by the Fund's adviser. (If a security's rating is reduced below
the required minimum after a Fund has purchased it, the Fund is not required to
sell the security, but may consider doing so.) Convertible securities are
fixed-income securities which may be exchanged or converted into a predetermined
number of the issuer's underlying common stock at the option of the holder
during a specified time period. Convertible securities may take the form of
convertible bonds, convertible preferred stock or debentures, units consisting
of "usable" bonds and warrants or a combination of the features of several of
these securities. The investment characteristics of each convertible security
vary widely, which allows convertible securities to be employed for a variety of
different investment strategies.

U.S. Government Securities

The U.S. government securities in which the Funds may invest include: direct
obligations of the U.S. Treasury (such as Treasury bills, notes and bonds), and
obligations issued by U.S. government agencies or instrumentalities, including
securities that are supported by the full faith and credit of the United States
(such as Government National Mortgage Association certificates); securities that
are supported by the right of the issuer to borrow from the U.S. Treasury (such
as securities of Federal Home Loan Banks); and securities that are supported by
the credit of the instrumentality (such as Federal National Mortgage Association
and Federal Home Loan Mortgage Corporation bonds).

Equity Investment Considerations and Risk Factors

As with other mutual funds that invest primarily in equity securities, the Funds
are subject to market risks. Since equity markets tend to be cyclical, the
possibility exists that the value of common stocks could decline over short or
even extended periods of time.

With respect to the Small Company Stock Fund, because the Fund invests primarily
in small capitalization stocks, there are some additional risk factors
associated with investments in this Fund. small capitalization stocks have
historically been more volatile in price than larger capitalization stocks, such
as those included in the Standard & Poor's 500 Index. This is because, among
other things, smaller companies have a lower degree of liquidity in the equity
market and tend to have a greater sensitivity to changing economic conditions.
Further, in addition to exhibiting greater volatility, these stocks may, to some
degree, fluctuate independently of the stocks of large companies. That is, the
stocks of small capitalization companies may decline in price as the price of
large company stocks rises or vice versa. Therefore, investors should expect
that there will be periods of time when the Fund will exhibit greater volatility
than broad stock market indices such as the Standard & Poor's 500 Index.

Put and Call Options

The Funds may purchase put options on portfolio securities. A put option gives a
Fund, in return for a premium, the right to sell the underlying security to the
writer (seller) at a specified price during the term of the option. These
options will be used as a hedge to attempt to protect securities which a Fund
holds against decreases in value. These Funds may also write covered call
options on all or any portion of their portfolio to generate income. As a writer
of a call option, a Fund has the obligation upon exercise of the option during
the option period to deliver the underlying security upon payment of the
exercise price. A Fund will write call options on securities either held in its
portfolio, or which it has the right to obtain without payment of further
consideration, or for which it has segregated cash or U.S. government securities
in the amount of any additional consideration. The Funds may also purchase call
options which give the Funds the ability to purchase portfolio securities in the
future at a price specified in the call option.

Futures and Options on Futures

The Funds may purchase and sell futures contracts to hedge against the effects
of changes in the value of portfolio securities due to anticipated changes in
interest rates and market conditions. Futures contracts call for the delivery of
particular debt instruments at a certain time in the future. The seller of the
contract agrees to make delivery of the type of instrument called for in the
contract and the buyer agrees to take delivery of the instrument at the
specified future time.

Stock index futures contracts are based on indexes that reflect the market value
of common stock of the firms included in the indexes. An index futures contract
is an agreement pursuant to which two parties agree to take or make delivery of
an amount of cash equal to the differences between the value of the index at the
close of the last trading day of the contract and the price at which the index
contract was originally written. The Funds may also write call options and
purchase put options on futures contracts as a hedge to attempt to protect their
portfolio securities against decreases in value. When a Fund writes a call
option on a futures contract, it is undertaking the obligation of selling a
futures contract at a fixed price at any time during a specified period if the
option is exercised. Conversely, as purchaser of a put option on a futures
contract, a Fund is entitled (but not obligated) to sell a futures contract at
the fixed price during the life of the option.

The Funds may purchase call options on futures contracts as hedges against
rising purchase prices of portfolio securities. These Funds will use these
transactions to attempt to protect their ability to purchase portfolio
securities in the future at price levels existing at the time they enter into
the transactions. As a purchaser of a call option on a futures contract, these
Funds are entitled (but not obligated) to purchase a futures contract at a fixed
price at any time during the life of the option.

The Funds may not purchase or sell futures contracts or related options if
immediately thereafter the sum of the amount of margin deposits on a Fund's
existing futures positions and premiums paid for related options would exceed 5%
of the market value of a Fund's total assets. When a Fund purchases futures
contracts, an amount of cash and cash equivalents, equal to the underlying
commodity value of the futures contracts (less any related margin deposits),
will be deposited in a segregated account with the custodian (or the broker, if
legally permitted) to collateralize the position and thereby insure that the use
of such futures contracts are unleveraged. When a Fund sells futures contracts,
it will either own or have the right to receive the underlying future or
security, or will make deposits to collateralize the position as discussed
above.

Risks
When a Fund uses futures and options on futures as hedging devices, there is a
risk that the prices of the securities subject to the futures contracts may not
correlate perfectly with the prices of the securities in that Fund's portfolio.
This may cause the futures contract and any related options to react differently
than the portfolio securities to market changes. In addition, the investment
adviser could be incorrect in its expectations about the direction or extent of
market factors such as stock price movements. In these events, a Fund may lose
money on the futures contract or option.

Investing in Securities of Other Investment Companies

The Funds may invest in the securities of other investment companies, but will
not own more than 3% of the total outstanding voting stock of any investment
company, invest more than 5% of total assets in any one investment company, or
invest more than 10% of total assets in investment companies in general unless
permitted to do so by order of the Securities and Exchange Commission. The Funds
will invest in other investment companies primarily for the purpose of investing
short-term cash which has not yet been invested in other portfolio instruments.
Shareholders should realize that when a Fund invests in other investment
companies, certain Fund expenses, such as advisory fees, custodian fees and
administrative fees, may be duplicated. These limitations are not applicable if
the securities are acquired in a merger, consolidation, reorganization, or
acquisition of assets.

Demand Master Notes

The Funds may invest in variable amount demand master notes. Demand notes are
short-term borrowing arrangements between a corporation or government agency and
an institutional lender (such as a Fund) payable upon demand by either party.
The notice period for demand typically ranges from one to seven days, and the
party may demand full or partial payment. Many master notes give a Fund the
option of increasing or decreasing the principal amount of the master note on a
daily or weekly basis within certain limits. Demand master notes usually provide
for floating or variable rates of interest.

Foreign Investments

ADRs, ECDs, ETDs, Yankee CDs, Canadian Commercial Paper, Europaper and foreign
debt obligations are subject to somewhat different risks than corresponding
securities of domestic issuers. Examples of these risks include international,
economic and political developments, foreign governmental restrictions that may
adversely affect the payment of dividends, principal or interest, foreign
withholding or other taxes on interest income, difficulties in obtaining or
enforcing a judgment against the issuer, and the possible impact of
interruptions in the flow of international currency transactions. Different
risks may also exist for ECDs, ETDs, and Yankee CDs because the banks issuing
these instruments, or their domestic or foreign branches, are not necessarily
subject to the same regulatory requirements that apply to domestic banks, such
as reserve requirements, loan limitations, examinations, accounting, auditing,
and recordkeeping, and the public availability of information. These factors
will be carefully considered by the investment adviser in selecting investments
for a Fund.

Temporary Investments

RIGGS FUNDS INFORMATION

Management of Riggs Funds

Board of Trustees

Investment Adviser

Advisory Fees

The Adviser receives an annual investment advisory fee at annual rates equal to
0.75% Stock Fund's and Small Company Stock Fund's average net assets. The
investment advisory contract provides for the voluntary waiver of expenses by
the Adviser from time to time. The Adviser can terminate this voluntary waiver
of expenses at any time with respect to a Fund at its sole discretion.

Adviser's Background

RIMCO is a subsidiary of Riggs Bank, which is a subsidiary of Riggs National
Corporation, a bank holding company. RIMCO has advised the Riggs Funds since
September 1991, and as of April 30, 1998, provides investment advice for assets
approximating $2.8 billion. RIMCO has a varied client base of over 100 other
relationships including corporate, union and public pension plans, foundations,
endowments and associations. As part of its regular banking operations, Riggs
Bank may make loans to public companies. Thus, it may be possible, from time to
time, for a Fund to hold or acquire the securities of issuers which are also
lending clients of Riggs Bank. The lending relationship will not be a factor in
the selection of securities.

Distribution of Class B Shares of the Funds

Distribution Plan and Shareholder Services Plan

Pursuant to the provisions of the distribution plan adopted in accordance with
the Investment Company Act Rule 12b-1 (the "Plan"), the Class B Shares of the
Stock Fund and Small Company Stock Fund may pay to the distributor a fee
computed at an annual rate of up to 0.75% of the average daily net assets of
such Funds. (In addition, the Class R Shares of the Stock Fund and Small Company
Stock Fund are subject to a Rule 12b-1 distribution fee as described under the
caption "Other Classes of Shares" and in a separate prospectus relating to Class
R Shares.)

The classes of shares of each Fund represent interests in one common investment
portfolio but differ in that shares are subject to different distribution
expenses paid pursuant to the Plan. Class B Shares are sold primarily to retail
customers through broker/dealers which are not affiliated with Riggs Bank. See
"Other Classes of Shares" for a description of Class R Shares of the Funds.

The distributor may from time to time and for such periods as its deems
appropriate, voluntarily reduce its compensation under the Plan to the extent
the expenses attributable to the Class B Shares exceed such lower expense
limitation as the distributor may, by notice of the Trust, voluntarily declare
to be effective.

Under the Plan, the distributor may select financial institutions such as banks,
fiduciaries, custodians for public funds, investment advisers, and brokers to
provide sales and/or administrative services as agents for their clients or
customers who beneficially own Class B Shares of the Funds.

The Plan is a compensation type plan. As such, the Class B Shares of the Funds
make no payments to the distributor except as described above. Therefore, the
Class B Shares of the Funds do not pay for unreimbursed expenses of the
distributor, including amounts expended by the distributor in excess of amounts
received by it from the Class B Shares of the Funds, interest, carrying or other
financing charges in connection with excess amounts expended, or the
distributor's overhead expenses. However, the distributor may be able to recover
such amounts or may earn a profit from future payments made by the Class B
Shares of the Funds under the Plan.

In addition, the Trust has entered into a Shareholder Services Agreement with
Federated Shareholder Services, a subsidiary of Federated Investors, Inc., under
which both classes of shares of the Funds may make payments up to 0.25% of the
average daily net asset value of a Fund's shares, computed at an annual rate to
obtain certain services for shareholders and to maintain shareholder accounts.
From time to time and for such periods as deemed appropriate, the amount stated
above may be reduced voluntarily. Under the Shareholder Services Agreement,
Federated Shareholder Services will either perform shareholder services directly
or will select financial institutions to perform shareholder services. Financial
institutions will receive fees based upon shares owned by their clients or
customers. The schedule of such fees and the basis upon which such fees will be
paid will be determined from time to time by the Trust and Federated Shareholder
Services.

Supplemental Payments to Financial Institutions

Administration of the Funds
Administrative Services

Federated Services Company, a subsidiary of Federated Investors, Inc., provides
certain administrative personnel and services (including certain legal,
financial reporting and transfer agency services) necessary to operate the
Funds. Federated Administrative Services Company provides these services at an
annual rate of 0.16% of the average daily net assets of the Trust.

Federated Services Company may voluntarily waive a portion of its fee.

Custodian

NET ASSET VALUE

Net asset value per share of the Funds fluctuates and is determined by dividing
the sum of the market value of all securities and other assets, less
liabilities, by the number of shares outstanding.

On Monday through Friday, the Funds calculate net asset value at the close of
trading on the New York Stock Exchange, normally 4:00 p.m. (Washington, D.C.
time), except on: (i) days on which there are not sufficient changes in the
value of a Fund's portfolio securities that its net asset value might be
materially affected; (ii) days during which no shares of a Fund are tendered for
redemption and no orders to purchase shares are received; and (iii) on the
following holidays: New Year's Day, Martin Luther King Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.

INVESTING IN CLASS B SHARES OF THE FUNDS

Share Purchases

Class B Shares of the Funds are sold on days on which both the New York Stock
Exchange and the Federal Reserve Wire system are open for business. Shares of
the Funds may be purchased through authorized broker/dealers. In connection with
the sale of shares of the Funds, the distributor may from time to time offer
certain items of nominal value to any shareholder or investor. The Funds reserve
the right to reject any purchase request and will not accept any purchase
request without having first received a completed account application.

Shares will be purchased at net asset value after the Fund receives the purchase
request from Riggs Bank. Purchase requests through authorized brokers and
dealers must be received by Riggs Bank and transmitted to the Fund before 3:00
p.m. (Washington, D.C. time) in order for shares to be purchased at that day's
public offering price.

Minimum Investment Required

The minimum initial investment in each Fund is $1000, except for an Individual
Retirement Account ("IRA") which requires a minimum initial investment of $500.
Subsequent investments must be in amounts of at least $100, except for an IRA,
which must be in amounts of at least $50. An investor's minimum investment will
be calculated by combining all mutual fund accounts it maintains in the Riggs
Funds.

What Shares Cost
Shares of the Funds are sold at their net asset value next determined after an
order is received. There is no sales charge imposed by the Funds at the time of
purchase.

Systematic Investment Program

Retirement Plans
Shares of the Funds can be purchased as an investment for retirement plans or
for IRA accounts. For further details, contact Riggs Bank and consult a tax
adviser.

Conversion of Class B Shares

Class B Shares will automatically convert into Class R Shares after six full
years from the purchase date. Such conversion will be on the basis of the
relative net asset value per share, without the imposition of any charges. Class
B Shares acquired by exchange from Class B Shares of another fund will convert
into Class R Shares based on the time of the initial purchase.

Confirmations and Account Statements

Dividends

Dividends on the Stock Fund and Small Company Stock Fund are declared and paid
quarterly. Unless cash payments are requested by shareholders in writing to the
appropriate Fund or by indication on the account application, dividends are
automatically reinvested in additional shares of the Fund on payment dates at
the ex-dividend date net asset value without a sales charge.

Capital Gains
Capital gains realized by a Fund, if any, will be distributed at least once
every 12 months.

EXCHANGES

A shareholder may generally exchange Class B Shares of one Fund for Class B
Shares of another Fund in the Trust and for Class R Shares of Riggs Prime Money
Market Fund by calling the number on the front page of this prospectus, or by
writing to Riggs Bank. Shares purchased by check are eligible for exchange. A
contingent deferred sales charge ("CDSC") is not assessed in connection with
such exchanges, but if the shareholder redeems shares within five years of the
original purchase, a CDSC will be imposed. For purposes of computing the CDSC,
the length of time the shareholder has owned shares will be measured from the
date of original purchase and will not be affected by the exchange.

Orders to exchange shares of one Fund for shares of any of the other Funds will
be executed by redeeming the shares owned and purchasing shares of any of the
other Funds at the net asset value determined after the exchange request is
received. Orders for exchanges received by a Fund prior to 4:00 p.m.
(Washington, D.C. time) on any day that Fund is open for business will be
executed as of the close of business that day Orders for exchanges received
after 4:00 p.m. (Washington, D.C. time) on any business day will be executed at
the close of the next business day.

In the case where the new account registration is not identical to that of the
existing account, a signature guarantee is required. (See "Redeeming Shares By
Mail.") Exercise of this privilege is treated as a sale for federal income tax
purposes and, depending on the circumstances, a short- or long-term capital gain
or loss may be realized. The Funds reserve the right to modify or terminate the
exchange privilege at any time. Shareholders will be notified prior to any
modification or termination of this privilege. Shareholders may obtain further
information on the exchange privilege by calling Riggs Funds Shareholder
Services at (301) 887-4280 or outside the metropolitan Washington, D.C. area
toll-free 1-800-934-3883.

An excessive number of exchanges may be disadvantageous to the Trust. Therefore,
the Trust, in addition to its right to reject any exchange, reserves the right
to modify or terminate the exchange privilege at anytime. Shareholders would be
notified prior to any modification or termination.

Systematic Exchange Program

Shareholders who desire to automatically exchange shares of a predetermined
amount on a monthly, quarterly or annual basis may take advantage of a
systematic exchange privilege. The minimum amount that may be exchanged is $50.
Shareholders interested in participating in this program should contact Riggs
Funds Shareholder Services for more information.

REDEEMING CLASS B SHARES

Each Fund redeems Class B Shares (and any Class R Shares of Riggs Prime Money
Market Fund acquired in exchange for Class B Shares) at their net asset value,
less any applicable CDSC, next determined after Riggs Bank receives the
redemption request.

By Telephone

A shareholder may redeem shares of a Fund by calling the number on the front
page of this prospectus. Shares will be redeemed at the net asset value, less
any applicable CDSC, next determined after a Fund receives the redemption
request from Riggs Bank. Although Riggs Bank does not charge for telephone
redemptions, it reserves the right to charge a fee for the cost of wire-
transferred redemptions of less than $5,000, or in excess of one per month.

A redemption request with respect to Stock Fund and Small Company Stock Fund
must be received by Riggs Bank before 4:00 p.m. (Washington D.C. time) in order
for shares to be redeemed at that day's net asset value. Riggs Bank is
responsible for promptly submitting redemption requests and providing proper
redemption instructions to a Fund. If, at any time, a Fund should determine it
necessary to terminate or modify this method of redemption, shareholders would
be promptly notified.

By Mail
Shareholders may redeem shares of a Fund by sending a written request to Riggs
Bank N.A., P.O. Box 96656, Washington, D.C. 20090-6656. The written request
should include the shareholder's name, the Fund name, the account number, and
the share or dollar amount requested, and should be signed by each registered
owner exactly as the shares are registered. If share certificates have been
issued, they must be properly endorsed and should be sent by registered or
certified mail with the written request to Riggs Bank.

. a trust company or commercial bank whose deposits are insured by BIF, which
is administered by the Federal Deposit Insurance Corporation ("FDIC");

. a member of the New York, American, Midwest, or Pacific
Stock Exchange;

. a savings bank or savings association whose deposits are insured by SAIF,
which is administered by the FDIC; or

. any other "eligible guarantor institution," as defined in the Securities
Exchange Act of 1934.

The Funds do not accept signatures guaranteed by a notary public.

Systematic Withdrawal Program

Shareholders who desire to receive payments of a predetermined amount may take
advantage of the Systematic Withdrawal Program. Once a Fund account has been
opened, shareholders may withdraw from their investment on a regular basis in a
minimum amount of $50. Under this program, Fund shares are redeemed at net asset
value, less any applicable CDSC, to provide for periodic withdrawal payments in
an amount directed by the shareholder. Depending upon the amount of the
withdrawal payments, the amount of dividends paid and capital gains
distributions with respect to Fund shares, and the fluctuation of the net asset
value of Fund shares redeemed under this program, redemptions may reduce, and
eventually deplete, the shareholder's investment in the Fund. For this reason,
payments under this program should not be considered as yield or income on the
shareholder's investment in the Fund. To be eligible to participate in this
program, a shareholder must have an account value of at least $10,000. A
shareholder may apply for participation in this program through Riggs Bank or an
authorized broker or dealer.

Contingent Deferred Sales Charge

Shareholders redeeming Class B Shares (and any Class R Shares of Riggs Prime
Money Market Fund acquired in exchange for Class B Shares) from the Funds within
five years of the purchase date will be charged a CDSC. The CDSC will be
deducted from the redemption proceeds otherwise payable to the shareholder and
will be retained by the distributor. Redemptions will be processed in a manner
intended to maximize the amount of redemption which will not be subject to a
CDSC. The CDSC will not be imposed with respect to shares acquired through the
reinvestment of dividends or distributions of long-term capital gains. In
determining the applicability of the CDSC, the required holding period for new
shares received through an exchange will include the period for which the
original shares were held. Any applicable CDSC will be imposed on the lesser of
the net asset value of the redeemed shares at the time of purchase or the net
asset value of the redeemed shares at the time of redemption in accordance with
the following schedule:

<TABLE>
<CAPTION>
Year of Redemption Contingent Deferred
After Purchase Sales Charge
<S> <C>
First 5.00%
Second 4.00%
Third 3.00%
Fourth 2.00%
Fifth 1.00%
Sixth 0.00%
</TABLE>

Eliminating the Contingent Deferred Sales Charge
Upon written notification to Federated Securities Corp. or the transfer agent,
no contingent deferred sales charge will be imposed on redemptions:

. following the death or disability, as defined in Section 72(m)(7)of the
Internal Revenue Code of 1986, of the last surviving shareholder;

. representing minimum required distributions from an Individual Retirement
Account or other retirement plan to a shareholder who has attained the age
of 701/2;

. which are involuntary redemptions of shareholder accounts that do not
comply with the minimum balance requirements; and

. which are qualifying redemptions of shares under a Systematic Withdrawal
Program.

For more information regarding any of the above provisions, contact Riggs Bank
or the Fund. The Funds reserve the right to discontinue or modify these
provisions. Shareholders will be notified of such action.

Accounts with Low Balances

SHAREHOLDER INFORMATION

Voting Rights

Each share of a Fund gives the shareholder one vote in Trustee elections and
other matters submitted to shareholders for vote. All shares of each Fund in the
Trust have equal voting rights, except that in matters affecting only a
particular Fund or class only shareholders of that Fund or class are entitled to
vote. As a Massachusetts business trust, the Trust is not required to hold
annual shareholder meetings. Shareholder approval will be sought only for
certain changes in the operation of the Trust or a Fund and for the election of
Trustees under certain circumstances. As of June 3, 1998, Riggs Bank may for
certain purposes be deemed to control the Funds because it is owner of record of
certain shares of the Funds.

EFFECT OF BANKING LAWS

TAX INFORMATION

Federal Income Tax

PERFORMANCE INFORMATION

From time to time the Stock Fund and Small Company Stock Fund may advertise
total return and all of the Funds may advertise yield.

The yields of the Stock Fund and Small Company Stock Fund are calculated by
dividing the net investment income per share (as defined by the Securities and
Exchange Commission) earned by the Fund over a thirty-day period by the maximum
offering price per share of the Fund on the last day of the period. This number
is then annualized using semi-annual compounding. The yield does not necessarily
reflect income actually earned by the Fund and, therefore, may not correlate to
the dividends or other distributions paid to shareholders.

From time to time, advertisements for the Funds may refer to ratings, rankings,
and other information in certain financial publications and/or compare the
Funds' performance to certain indices.

OTHER CLASS OF SHARES

Stock Fund and Small Company Stock Fund also offer another class of shares
called Class R Shares. Class R Shares are sold at net asset value and are
redeemed at net asset value, less any applicable CDSC of 2.00% of the lesser of
(i) the net assets value of the redeemed shares at the time of purchase or (ii)
the net asset value of the redeemed shares at the time of redemption.

Class R Shares are sold primarily to retail customers of Riggs Bank through
Riggs Bank and its affiliates. The minimum initial investment is$1000.

Both classes are subject to certain of the same expenses.

Class R Shares are subject to Rule 12b-1 fees at an annual rate of up to 0.25%
of the average daily net assets and are subject to shareholder services fees at
an annual rate of up to 0.25% of the average daily net assets.

Expense differences between classes may affect the performance of each class.

To obtain more information and a prospectus for Class R Shares, investors may
call (301) 887-4280, or outside the Washington, D.C. metropolitan area,
toll-free 1-800-934-3883.

Class B Shares were not offered prior to July 1, 1998. Set forth on the
following pages are Financial Highlights for Class R Shares of Stock Fund for
the five fiscal years ended April 30, 1998, and for Class R Shares of Small
Company Stock Fund for the period February 27, 1995 (date of inception) through
April 30, 1998. As discussed above, expense differences between Class R Shares
and Class B Shares may affect the performance of each class.

FINANCIAL HIGHLIGHTS--RIGGS STOCK FUND

Class R Shares

(For a share outstanding throughout each period)

FINANCIAL HIGHLIGHTS--RIGGS SMALL COMPANY STOCK FUND

(formerly, RIMCO Monument Small Capitalization Equity Fund)

Class R Shares

(For a share outstanding throughout each period)

<TABLE>
<CAPTION>
Year Ended April 30,
1998 1997 1996 1995(a)
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 12.80 $ 14.10 $ 10.43 $ 10.00
Income from investment operations
Net investment income (0.04) (0.01) (0.02) 0.02
Net realized and unrealized gain (loss) on investments 9.23 (0.47) 4.05 0.41
Total from investment operations 9.19 (0.48) 4.03 0.43
Less distributions
Distributions from net investment income -- -- (0.01) --
Distributions from net realized gain on investments (3.19) (0.82) (0.35) --
Total distributions (3.19) (0.82) (0.36) --
Net asset value, end of period $ 18.80 $ 12.80 $ 14.10 $ 10.43
Total return (b) 77.85% (3.76%) 39.43% 4.30%
Ratios to average net assets
Expenses 1.09% 1.00% 1.14% 1.66%*
Net investment income (0.26%) (0.07%) (0.13%) 0.98%*
Expense reimbursement/waiver (c) 0.09% 0.46% 0.80% 1.54%*
Supplemental data
Net assets, end of period (000 omitted) $58,223 $27,777 $19,289 $ 7,609
Average commission rate paid (d) $0.0631 $0.0691 $0.0650 --
Portfolio turnover 108% 93% 70% 8%
</TABLE>
* Computed on an annualized basis.
(a) Reflects operations for the period from February 27, 1995 (date of initial
public investment) to April 30, 1995.
(b) Based on net asset value, which does not reflect the sales charge or
contingent deferred sales charge, if applicable.
(c) This voluntary expense decrease is reflected in both the expense and net
investment income ratios shown above.
(d) Represents total commissions paid on portfolio securities divided by total
portfolio shares purchased or sold on which commissions were charged.
Further information about the Fund's performance is contained in the Fund's
annual report for the fiscal year ended April 30, 1998, which can be obtained
free of charge.

Riggs Stock Fund
Class B Shares
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

Riggs Small Company
Stock Fund
Class B Shares
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

Distributor
Federated Securities Corp.
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

Investment Adviser
Riggs Investment Management Corp.
800 17th Street N.W.
Washington, D.C. 20006-3950
Custodian
Riggs Bank N.A.
Riggs Funds
5700 RiverTech Court
Riverdale, MD 20737-1250

Transfer Agent, Dividend Disbursing Agent, and Portfolio Accounting Services
Federated Shareholder
Services Company
Federated Investors Tower
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779

Independent Auditors
Ernst & Young LLP
One Oxford Centre
Pittsburgh, Pennsylvania 15219

Cusip 76656A 708
Cusip 76656A 880
G00355-01 (6/98)

Riggs Funds
(Formerly, RIMCO Monument Funds)
Riggs U.S. Treasury Money Market Fund
Class R Shares
Class Y Shares
Riggs Prime Money Market Fund
Class R Shares
Class Y Shares
Riggs U.S. Government Securities Fund
(Formerly, RIMCO Bond Fund)
Class R Shares
Riggs Stock Fund
Class R Shares
Class B Shares
Riggs Small Company Stock Fund
(Formerly, RIMCO Small Capitalization Equity Fund)
Class R Shares
Class B Shares

Statement Of Additional Information

This Statement of Additional Information should be read with the combined
prospectuses of Riggs Funds (the "Trust"), dated June 30, 1998. This Statement
is not a prospectus. You may request a copy of a prospectus or a paper copy of
this Statement, if you have received it electronically, free of charge by
calling the Trust.

Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
Statement dated June 30, 1998

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Cusip 76656A401 Cusip 76656A302 Cusip 76656A203 Cusip 76656A104 Cusip
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1061803B (6/98)

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Table of Contents

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General Information About the Trust 1

Investment Objective and Policies of the Funds 1
Repurchase Agreements 1
Reverse Repurchase Agreements 1
Credit Enhancement 1
When-Issued and Delayed Delivery Transactions 2
Restricted and Illiquid Securities 2
Lending of Portfolio Securities 2
U.S. Government Securities 2
Bank Instruments 3
Money Market Instruments Ratings 3
Funding Agreements 3
Futures and Options Transactions 3
Futures Contracts 4
Put Options on Futures Contracts 4
Call Options on Futures Contracts 4
"Margin" in Futures Transactions 5
Collateralized Mortgage Obligations (CMOs) 5
Real Estate Investment Trusts 6
Convertible Securities 6
Warrants 6
Portfolio Turnover 6
Investment Limitations 6
Regulatory Compliance 9

Riggs Funds Management 9
Fund Ownership 13
Trustees Compensation 13
Trustee Liability 14
Massachusetts Partnership Law 14

Investment Advisory Services 14
Adviser to the Trust 14
Advisory Fees 14

Administrative Services 15
Custodian 15
Transfer Agent, Dividend Disbursing Agent
and Portfolio Accounting Services 15
Independent Auditors 15

Brokerage Transactions 15

Purchasing Shares 16
Distribution Plan and
Shareholder Services Plan 16
Conversion to Federal Funds 16

Determining Net Asset Value 16
Determining Market Value of Securities 16
Use of the Amortized Cost Method 17

Redeeming Shares 18
Contingent Deferred Sales Charge 18
Redemption in Kind 18

Tax Status 18
The Funds' Tax Status 18
Shareholders' Tax Status 18
Capital Gains 18

Total Return 19

Yield 19

Effective Yield 19

Performance Comparisons 20
Economic and Market Information 20
U.S. Treasury Money Market Fund 20
Prime Money Market Fund 21
U.S. Government Securities Fund 21
Stock Fund 22
Small Company Stock Fund 22

Financial Statements 22

Appendix 23

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General Information About the Trust
The Trust was established as a Massachusetts business trust under a Declaration
of Trust dated April 1, 1991. At a meeting of the Board of Trustees (the
"Trustees") held on May 13, 1998, the Trustees approved an amendment to the
Declaration of Trust to change the name of RIMCO Monument Funds. to Riggs Funds.
As of the date of this Statement, the Trust consists of five separate portfolios
of securities (the "Funds") which are as follows: Riggs U.S. Treasury Money
Market Fund ("U.S. Treasury Money Market Fund"), Riggs Prime Money Market Fund
("Prime Money Market Fund"), Riggs U.S. Government Securities Fund ("U.S.
Government Securities Fund"), Riggs Stock Fund ("Stock Fund") and Riggs Small
Company Stock Fund ("Small Company Stock Fund").

As of the date of this Statement, Shares of the Funds are offered in three
classes: U.S. Treasury Money Market Fund Class R Shares and Class Y Shares;
Prime Money Market Fund Class R Shares and Class Y Shares; Stock Fund Class R
Shares and Class B Shares; Small Company Stock Fund Class R Shares and Class B
Shares, and U.S. Government Securities Fund Class R Shares. Prior to August 23,
1995, Prime Money Market Fund offered a single class of shares, which are
currently designated as Class R Shares.

Investment Objective and Policies of the Funds
The Prospectuses discuss the objective of each Fund and the policies it employs
to achieve those objectives. The following discussion supplements the
description of the Funds' investment policies in the Prospectuses.

The Funds' respective investment objectives cannot be changed without approval
of shareholders. The investment policies described below may be changed by the
Board of Trustees (the "Trustees") without shareholder approval. Shareholders
will be notified before any material change in these policies becomes effective.

Repurchase Agreements

The Funds or their custodian will take possession of the securities subject to
repurchase agreements and these securities will be marked to market daily. In
the event that a defaulting seller filed for bankruptcy or became insolvent,
disposition of such securities by a Fund might be delayed pending court action.
The Funds believe that under the regular procedures normally in effect for
custody of a Fund's portfolio securities subject to repurchase agreements, a
court of competent jurisdiction would rule in favor of a Fund and allow
retention or disposition of such securities. The Funds will only enter into
repurchase agreements with banks and other recognized financial institutions
such as broker/dealers which are deemed by the adviser to be creditworthy
pursuant to guidelines established by the Trustees.

Reverse Repurchase Agreements

The Funds may also enter into reverse repurchase agreements. These transactions
are similar to borrowing cash. In a reverse repurchase agreement a Fund
transfers possession of a portfolio instrument to another person, such as a
financial institution, broker, or dealer, in return for a percentage of the
instrument's market value in cash, and agrees that on a stipulated date in the
future the Fund will repurchase the portfolio instrument by remitting the
original consideration plus interest at an agreed upon rate. The use of reverse
repurchase agreements may enable a Fund to avoid selling portfolio instruments
at a time when a sale may be deemed to be disadvantageous, but the ability to
enter into reverse repurchase agreements does not ensure that a Fund will be
able to avoid selling portfolio instruments at a disadvantageous time.

When effecting reverse repurchase agreements, liquid assets of a Fund, in a
dollar amount sufficient to make payment for the obligations to be purchased,
are segregated at the trade date. These securities are marked to market daily
and are maintained until the transaction is settled.

Credit Enhancement

The Prime Money Market Fund typically evaluates the credit quality and ratings
of credit-enhanced securities based upon the financial condition and ratings of
the party providing the credit enhancement (the "credit enhancer"), rather than
the issuer. However, credit-enhanced securities will not be treated as having
been issued by the credit enhancer for diversification purposes, unless the Fund
has invested more than 10% of its assets in securities issued, guaranteed or
otherwise credit enhanced by the credit enhancer, in which case the securities
will be treated as having been issued by both the issuer and the credit
enhancer. The Fund may have more than 25% of its total assets invested in
securities credit enhanced by banks.

When-Issued and Delayed Delivery Transactions

The Funds may engage in when-issued and delayed delivery transactions. These
transactions are made to secure what is considered to be an advantageous price
or yield for a Fund. However, liquid assets of a Fund sufficient to make payment
for the securities to be purchased are segregated on the Fund's records at the
trade date. These assets are marked to market daily and are maintained until the
transaction has been settled. As a matter of policy, the Funds do not intend to
engage in when-issued and delayed delivery transactions to an extent that would
cause the segregation of more than 20% of the total value of their respective
assets.

Restricted and Illiquid Securities

The ability of the Trustees to determine the liquidity of certain restricted
securities is permitted under a Securities and Exchange Commission (the "SEC")
Staff position set forth in the adopting release for Rule 144A under the
Securities Act of 1933 (the "Rule"). The Rule is a non- exclusive, safe-harbor
for certain secondary market transactions involving securities subject to
restrictions on resale under federal securities laws. The Rule provides an
exemption from registration for resales of otherwise restricted securities to
qualified institutional buyers. The Rule was expected to further enhance the
liquidity of the secondary market for securities eligible for resale under the
Rule. The Trust, on behalf of the Funds, believes that the Staff of the SEC has
left the question of determining the liquidity of all restricted securities for
determination to the Trustees. The Trustees consider the following criteria in
determining the liquidity of certain restricted securities:

o the frequency of trades and quotes for the security;

o the number of dealers willing to purchase or sell the security and the
number of other potential buyers;

o dealer undertakings to make a market in the security; and

o the nature of the security and the nature of the marketplace trades.

Lending of Portfolio Securities

The collateral received when a Fund lends portfolio securities must be valued
daily and, should the market value of the loaned securities increase, the
borrower must furnish additional collateral to the particular Fund. During the
time portfolio securities are on loan, the borrower pays a Fund any dividends or
interest paid on such securities. Loans are subject to termination at the option
of a Fund or the borrower. A Fund may pay reasonable administrative and
custodial fees in connection with a loan and may pay a negotiated portion of the
interest earned on the cash or equivalent collateral to the borrower or placing
broker.

A Fund would not have the right to vote securities on loan, but would terminate
the loan and regain the right to vote if that were considered important with
respect to the investment.

U.S. Government Securities

The types of U.S. government securities in which the Prime Money Market Fund,
U.S. Government Securities Fund, Stock Fund, and Small Company Stock Fund may
invest generally include direct obligations of the U.S. Treasury (such as U.S.
Treasury bills, notes, and bonds) and obligations issued or guaranteed by U.S.
government agencies or instrumentalities. These securities are backed by:

o the full faith and credit of the U.S. Treasury;

o the issuer's right to borrow from the U.S. Treasury;

o the discretionary authority of the U.S. government to purchase certain
obligations of the agency or instrumentality; or

o the credit of the agency or instrumentality issuing the obligations.

Examples of agencies and instrumentalities whose obligations are permissible
investments but may not always receive financial support from the U.S.
government are: the Farm Credit System, including the National Bank for
Cooperatives, Farm Credit Banks, and Banks for Cooperatives; Federal Home Loan
Banks; Farmers Home Administration; and Federal National Mortgage Association.

Bank Instruments

Prime Money Market Fund, U.S. Government Securities Fund, Stock Fund, and Small
Company Stock Fund may invest in the instruments of banks and savings
associations whose deposits are insured by the Bank Insurance Fund, which is
administered by the Federal Deposit Insurance Corporation ("FDIC"), or the
Savings Association Insurance Fund, which is administered by the FDIC, such as
certificates of deposit, demand and time deposits, savings shares, and bankers'
acceptances. These instruments are not necessarily guaranteed by those
organizations.

In addition, the Funds may invest in:

o Eurodollar Certificates of Deposit ("ECDs") issued by foreign branches
of U.S. or foreign banks;

o Eurodollar Time Deposits ("ETDs"), which are U.S. dollar- denominated
deposits in foreign branches of U.S. or foreign banks;

o Canadian Time Deposits, which are U.S. dollar-denominated deposits
issued by branches of major Canadian banks located in the United
States; and

o Yankee Certificates of Deposit ("Yankee CDs"), which are U.S.
dollar-denominated certificates of deposit issued by U.S. branches of
foreign banks and held in the United States.

Money Market Instruments Ratings

An NRSRO's highest rating category is determined without regard for sub-
categories and gradations. For example, securities rated A-1 or A-1+ by Standard
& Poor's ("S&P"), Prime-1 by Moody's Investors Service, Inc. ("Moody's"), or
F-1+ or F-1 by Fitch IBCA, Inc. ("Fitch"), are all considered rated in the
highest short-term rating category. The Prime Money Market Fund will follow
applicable regulations in determining whether a security rated by more than one
NRSRO can be treated as being in the highest short-term rating category;
currently, such securities must be rated by two NRSROs in their highest rating
category. See "Regulatory Compliance," and the Appendix to this Statement of
Additional Information.

Funding Agreements

Prime Money Market Fund may purchase funding agreements ("Agreements"), which
are investment instruments issued by highly rated U.S. insurance companies.
Pursuant to such Agreements, the Fund may make cash contributions to a deposit
fund of the insurance company's general or separate accounts. The insurance
company then credits guaranteed interest to the Fund. The insurance company may
assess periodic charges against an Agreement for expenses and service costs
allocable to it, and the charges will be deducted from the value of the deposit
fund. The purchase price paid for an Agreement becomes part of the general
assets of the issuer, and the Agreement is paid from the general assets of the
issuer.

The Fund will only purchase Agreements from issuers which, at the time of
purchase, meet quality and credit standards established by the Fund's adviser.
Generally, Agreements are not assignable or transferable without the permission
of the issuing insurance companies, and an active secondary market in Agreements
does not currently exist. Also, the Fund may not receive the principal amount of
an Agreement from the insurance company on seven days' notice or less.
Therefore, Agreements are typically considered to be illiquid investments.
Futures and Options Transactions

U.S. Government Securities Fund, Stock Fund, and Small Company Stock Fund may
engage in futures and options transactions. In an effort to reduce fluctuations
in the net asset value of shares of a Fund, a Fund may attempt to hedge all or a
portion of its portfolio by buying and selling financial futures contracts,
buying put options on portfolio securities and listed put options on futures
contracts, (or over- the-counter put options on futures contracts in the case of
U.S. Government Securities Fund) and writing call options on futures contracts.
A Fund may also write covered call options on portfolio securities to attempt to
increase its current income. A Fund will maintain its positions in securities,
option rights, and segregated cash subject to puts and calls until the options
are exercised, closed, or have expired. With respect to Bond Fund, an option
position on financial futures contracts may be closed out over-the-counter or on
an exchange which provides a secondary market for options of the same series.
With respect to Stock Fund and Small Company Stock Fund, an option position on
financial futures contracts may be closed out only on an exchange which provides
a secondary market for options of the same series.

Futures Contracts

U.S. Government Securities Fund, Stock Fund, and Small Company Stock Fund may
engage in futures contracts. A futures contract is a firm commitment by two
parties: the seller who agrees to make delivery of the specific type of security
called for in the contract ("going short") and the buyer who agrees to take
delivery of the security ("going long") at a certain time in the future.
However, a stock index futures contract is an agreement pursuant to which two
parties agree to take or make delivery of an amount of cash equal to the
difference between the value of the index at the close of the last trading day
of the contract and the price at which the index contract was originally
written. No physical delivery of the underlying securities in the index is made.

The purpose of the acquisition or sale of a futures contract by a Fund is to
protect the Fund from fluctuations in the value of its securities caused by
anticipated changes in interest rates or market conditions without necessarily
buying or selling the securities. For example, in the fixed income securities
market, price moves inversely to interest rates. A rise in rates means a drop in
price. Conversely, a drop in rates means a rise in price. In order to hedge its
holdings of fixed income securities against a rise in market interest rates,
U.S. Government Securities Fund could enter into contracts to deliver securities
at a predetermined price (i.e., "go short") to protect itself against the
possibility that the prices of its fixed income securities may decline during
the Fund's anticipated holding period. U.S. Government Securities Fund would "go
long" (agree to purchase securities in the future at a predetermined price) to
hedge against a decline in market interest rates.

Put Options on Futures Contracts

U.S. Government Securities Fund, Stock Fund, and Small Company Stock Fund may
engage in put options on futures contracts. A Fund may purchase listed put
options on futures contracts (or over-the-counter put options on futures
contracts in the case of U.S. Government Securities Fund). Unlike entering
directly into a futures contract, which requires the purchaser to buy a
financial instrument on a set date at a specified price, the purchase of a put
option on a futures contract entitles (but does not obligate) its purchaser to
decide on or before a future date whether to assume a short position at the
specified price. A Fund would purchase put options on futures contracts to
protect portfolio securities against decreases in value resulting from market
factors such as an anticipated increase in interest rates.

Generally, if the hedged portfolio securities decrease in value during the term
of an option, the related futures contracts will also decrease in value and the
option will increase in value. In such an event, a Fund will normally close out
its option by selling an identical option. If the hedge is successful, the
proceeds received by a Fund upon the sale of the second option may be large
enough to offset both the premium paid by the Fund for the original option plus
the decrease in value of the hedged securities.

Alternatively, a Fund may exercise its put option to close out the position. To
do so, it would simultaneously enter into a futures contract of the type
underlying the option (for a price less than the strike price of the option) and
exercise the option. The Fund would then deliver the futures contract in return
for payment of the strike price. If the Fund neither closes out nor exercises an
option, the option will expire on the date provided in the option contract, and
only the premium paid for the contract will be lost.

Call Options on Futures Contracts

U.S. Government Securities Fund, Stock Fund, and Small Company Stock Fund may
engage in call options on futures contracts. In addition to purchasing put
options on futures, U.S. Government Securities Fund, Stock Fund, and Small
Company Stock Fund may write listed call options on futures contracts (or
over-the-counter call options on futures contracts in the case of U.S.
Government Securities Fund) to hedge its respective portfolio against, for
example, an increase in market interest rates. When a Fund writes a call option
on a futures contract, it is undertaking the obligation of assuming a short
futures position (selling a futures contract) at the fixed strike price at any
time during the life of the option if the option is exercised. As market
interest rates rise (in the case of U.S. Government Securities Fund) or as stock
prices fall (in the case of Stock Fund and Small Company Stock Fund), causing
the prices of futures to go down, a Fund's obligation under a call option on a
future (to sell a futures contract) costs less to fulfill, causing the value of
a Fund's call option position to increase.

In other words, as the underlying future's price goes down below the strike
price, the buyer of the option has no reason to exercise the call, so that a
Fund keeps the premium received for the option. This premium can help
substantially to offset the drop in value of a Fund's portfolio securities.
Prior to the expiration of a call written by a Fund, or exercise of it by the
buyer, a Fund may close out the option by buying an identical option. If the
hedge is successful, the cost of the second option will be less than the premium
received by a Fund for the initial option. The net premium income of a Fund will
then substantially offset the decrease in value of the hedged securities.

A Fund will not maintain open positions in futures contracts it has sold or call
options it has written on futures contracts if, in the aggregate, the value of
the open positions (marked to market) exceeds the current market value of its
securities portfolio plus or minus the unrealized gain or loss on those open
positions, adjusted for the correlation of volatility between the hedged
securities and the futures contracts. If this limitation is exceeded at any
time, a Fund will take prompt action to close out a sufficient number of open
contracts to bring its open futures and options positions within this
limitation.

"Margin" in Futures Transactions

Unlike the purchase or sale of a security, neither U.S. Government Securities
Fund, Stock Fund, nor Small Company Stock Fund pay or receive money upon the
purchase or sale of a futures contract. Rather, the Funds are required to
deposit an amount of "initial margin" in cash or U.S. Treasury bills with the
custodian (or the broker, if legally permitted). The nature of initial margin in
futures transactions is different from that of margin in securities transactions
in that futures contracts initial margin does not involve a borrowing by a Fund
to finance the transactions. Initial margin is in the nature of a performance
bond or good faith deposit on the contract which is returned to a Fund upon
termination of the futures contract, assuming all contractual obligations have
been satisfied. A futures contract held by U.S. Government Securities Fund,
Stock Fund, or Small Company Stock Fund is valued daily at the official
settlement price of the exchange on which it is traded. Each day a Fund pays or
receives cash, called "variation margin," equal to the daily change in value of
the futures contract. This process is known as "marking to market." Variation
margin does not represent a borrowing or loan by a Fund but is instead
settlement between a Fund and the broker of the amount one would owe the other
if the futures contract expired. In computing its daily net asset value, a Fund
will mark to market its open futures positions. The Funds are also required to
deposit and maintain margin when they write call options on futures contracts.

The Funds will comply with the following restrictions when purchasing and
selling futures contracts. First, the Funds will not participate in futures
transactions if the sum of its initial margin deposits on open contracts will
exceed 5% of the market value of its respective total assets, after taking into
account the unrealized profits and losses on those contracts it has entered
into. Second, the Funds will not enter into these contracts for speculative
purposes. Third, since the Funds do not constitute a commodity pool, they will
not market themselves as such, nor serve as vehicles for trading in the
commodities futures or commodity options markets. Connected with this, the Funds
will disclose to all prospective investors, the limitations on their futures and
option transactions, and make clear that these transactions are entered into
only for bona fide hedging purposes, or other permissible purposes pursuant to
regulations promulgated by the Commodity Futures Trading Commission ("CFTC").
Finally, because the Funds will submit to the CFTC special calls for
information, the Funds will not register as commodities pool operators.

Collateralized Mortgage Obligations (CMOs)

U.S. Government Securities Fund may invest in CMOs. Privately issued CMOs
generally represent an ownership interest in a pool of federal agency mortgage
pass-through securities, such as those issued by the Government National
Mortgage Association. The terms and characteristics of the mortgage instruments
may vary among pass-through mortgage loan pools. The market for such CMOs has
expanded considerably since its inception. The size of the primary issuance
market and the active participation in the secondary market by securities
dealers and other investors make government-related pools highly liquid.

Generally-speaking, the mortgages underlying mortgage-backed securities often
may be prepaid without penalty or premium. Therefore, mortgage-backed securities
are generally subject to higher prepayment risks than most other types of debt
instruments. Prepayment risks on mortgage securities tend to increase during
periods of declining mortgage interest rates, because many borrowers refinance
their mortgages to take advantage of the more favorable rates. Depending upon
market conditions, the yield that the Fund receives from the reinvestment of
such prepayments, or any scheduled principal payments, may be lower than the
yield on the original mortgage security. As a consequence, mortgage securities
may be a less effective means of "locking in" interest rates than other types of
debt securities having the same stated maturity and may also have less potential
for capital appreciation. For certain types of asset pools, such as
collateralized mortgage obligations, prepayments may be allocated to one tranche
of securities ahead of other tranches, in order to reduce the risk of
prepayments for the other tranches. Prepayments may result in a capital loss to
the Fund to the extent that the prepaid mortgage securities were purchased at a
market premium over their stated principal amount. Conversely, the prepayment of
mortgage securities purchased at a market discount from their stated principal
amount will accelerate the recognition of interest income by the Fund, which
would be taxed as ordinary income when distributed to the shareholders.

Real Estate Investment Trusts

The Small Company Stock Fund may purchase interests in real estate investment
trusts. Risks associated with real estate investments include the fact that
equity and mortgage real estate investment trusts are dependent upon management
skill and are not diversified, and are, therefore, subject to the risk of
financing single projects or unlimited number of projects. They are also subject
to heavy cash flow dependency, defaults by borrowers, and self-liquidation.
Additionally, equity real estate investment trusts may be affected by any
changes in the value of the underlying property owned by the trusts, and
mortgage real estate investment trusts may be affected by the quality of any
credit extended. The investment adviser seeks to mitigate these risks by
selecting real estate investment trusts diversified by sector (shopping malls,
apartment building complexes, and health care facilities) and geographic
location.

Convertible Securities

When owned as part of a unit along with warrants, which entitle the holder to
buy the common stock, convertible securities function as convertible bonds,
except that the warrants generally will expire before the bond's maturity.
Convertible securities are senior to equity securities, and therefore have a
claim to assets of the corporation prior to the holders of common stock in the
case of liquidation. However, convertible securities are generally subordinated
to similar nonconvertible securities of the same company. The interest income
and dividends from convertible bonds and preferred stocks provide a stable
stream of income with generally higher yields than common stocks, but lower than
non-convertible securities of similar quality.

The Funds will exchange or convert the convertible securities held in their
portfolios into shares of the underlying common stocks when, in the investment
adviser's opinion, the investment characteristics of the underlying common
shares will assist the Funds in achieving their investment objectives.
Otherwise, the Funds will hold or trade the convertible securities. In selecting
convertible securities for the Fund, the Fund's adviser evaluates the investment
characteristics of the convertible security as a fixed income instrument, and
the investment potential of the underlying equity security for capital
appreciation. In evaluating these matters with respect to a particular
convertible security, the Fund's adviser considers numerous factors, including
the economic and political outlook, the value of the security relative to other
investment alternatives, trends in the determinants of the issuer's profits, and
the issuer's management capability and practices.

Warrants

Stock Fund and Small Company Stock Fund may invest in warrants. Warrants are
basically options to purchase common stock at a specific price (usually at a
premium above the market value of the optioned common stock at issuance) valid
for a specific period of time. Warrants may have a life ranging from less than a
year to twenty years or may be perpetual. However, most warrants have expiration
dates after which they are worthless. In addition, if the market price of the
common stock does not exceed the warrant's exercise price during the life of the
warrant, the warrant will expire as worthless. Warrants have no voting rights,
pay no dividends, and have no rights with respect to the assets of the
corporation issuing them. The percentage increase or decrease in the market
price of the warrant may tend to be greater than the percentage increase or
decrease in the market price of the optioned common stock.

Portfolio Turnover

For the fiscal years ended April 30, 1998 and 1997, the U.S. Government
Securities Fund portfolio turnover rates were 175% and 171%, respectively. Stock
Fund's portfolio turnover rates were 94% and 75% respectively. Small Company
Stock Fund's portfolio turnover rates were 108% and 93%, respectively.

Investment Limitations

Issuing Senior Securities and Borrowing Money

The Funds will not issue senior securities except that a Fund may borrow
money directly or through reverse repurchase agreements in amounts up to
one-third of the value of its total assets, including the amount borrowed;
and except to the extent that a Fund may enter into futures contracts. The
Funds will not borrow money or engage in reverse repurchase agreements for
investment leverage, but rather as a temporary, extraordinary, or
emergency measure or to facilitate management of the portfolio by enabling
a Fund to meet redemption requests when the liquidation of portfolio
securities is deemed to be inconvenient or disadvantageous. A Fund will
not purchase any securities while any borrowings in excess of 5% of its
total assets are outstanding. During the period any reverse repurchase
agreements are outstanding, a Fund will restrict the purchase of portfolio
securities to money market instruments maturing on or before the
expiration date of the reverse repurchase agreements, but only to the
extent necessary to assure completion of the reverse repurchase
agreements.

Selling Short and Buying on Margin

The Funds will not sell any securities short or purchase any securities on
margin, but may obtain such short-term credits as are necessary for
clearance of purchases and sales of securities. The deposit or payment by
U.S. Government Securities Fund, Stock Fund, or Small Company Stock Fund
of initial or variation margin in connection with futures contracts or
related options transactions is not considered the purchase of a security
on margin.

Pledging Assets

The Funds will not mortgage, pledge, or hypothecate any assets, except to
secure permitted borrowings. In these cases U.S. Treasury Money Market
Fund and Prime Money Market Fund may pledge assets having a market value
not exceeding the lesser of the dollar amounts borrowed or 10% of the
value of total assets of a Fund at the time of the pledge, while U.S.
Government Securities Fund, Stock Fund, and Company Stock Fund may pledge
assets having a value of 15% of assets taken at cost. For purposes of this
restriction, (a) the deposit of assets in escrow in connection with the
writing of covered put or call options and the purchase of securities on a
when-issued basis; and (b) collateral arrangements with respect to (i) the
purchase and sale of stock options and (ii) initial or variation margin
for futures contracts will not be deemed to be pledges of a Fund's assets.
Margin deposits for the purchase and sale of futures contracts and related
options are not deemed to be a pledge.

Lending Cash or Securities

The Funds will not lend any of their respective assets except portfolio
securities up to one-third of the value of total assets. This shall not
prevent a Fund from purchasing or holding U.S. government obligations,
money market instruments, variable amount demand master notes, bonds,
debentures, notes, certificates of indebtedness, or other debt securities,
entering into repurchase agreements, or engaging in other transactions
where permitted by a Fund's investment objective, policies, and
limitations or the Trust's Declaration of Trust.

Investing in Restricted Securities

Prime Money Market Fund, U.S. Government Securities Fund, Stock Fund, and
Small Company Stock Fund will not invest more than 10% of their respective
net assets in securities subject to restrictions on resale under the
Securities Act of 1933, except for commercial paper issued under Section
4(2) of the Securities Act of 1933 and certain other restricted securities
which meet the criteria for liquidity as established by the Board of
Trustees. U.S. Treasury Money Market Fund will not purchase or sell
securities which are restricted as to resale under federal securities law.

Investing in Commodities

None of the Funds will invest in commodities, except to the extent that
U.S. Government Securities Fund, Stock Fund, and Small Company Stock Fund
may engage in transactions involving futures contracts or options on
futures contracts.

Investing in Real Estate

None of the Funds will purchase or sell real estate, including limited
partnership interests, although Prime Money Market Fund, U.S. Government
Securities Fund, Stock Fund, and Small Company Stock Fund may invest in
securities of issuers whose business involves the purchase or sale of real
estate or in securities which are secured by real estate or interests in
real estate.

Diversification of Investments

With respect to 75% of the value of its respective total assets, Prime
Money Market Fund, U.S. Government Securities Fund, Stock Fund, and Small
Company Stock Fund will not purchase securities issued by any one issuer
(other than cash, cash items or securities issued or guaranteed by the
government of the United States or its agencies or instrumentalities and
repurchase agreements collateralized by such securities), if as a result
more than 5% of the value of its total assets would be invested in the
securities of that issuer. No Fund will acquire more than 10% of the
outstanding voting securities of any one issuer.

Concentration of Investments

No Fund will invest 25% or more of the value of its respective total
assets in any one industry (other than securities issued by the U.S.
government, its agencies, or instrumentalities or repurchase agreements
collateralized by these securities), except that Prime Money Market Fund
may invest 25% or more of the value of its total assets in cash or cash
items, securities issued or guaranteed by the U.S. government, its
agencies, or instrumentalities, or instruments secured by these money
market instruments (i.e., repurchase agreements).

Underwriting

A Fund will not underwrite any issue of securities, except as a Fund may
be deemed to be an underwriter under the Securities Act of 1933 in
connection with the sale of securities in accordance with its investment
objective, policies, and limitations.

The above limitations cannot be changed with respect to a Fund without approval
of holders of a majority of that Fund's shares. The following limitations may be
changed by the Trustees without shareholder approval. Shareholders will be
notified before any material change in these limitations becomes effective.

Investing in Illiquid Securities

The U.S. Government Securities Fund, Stock Fund, and Small Company Stock
Fund will not invest more than 15% and the Prime Money Market Fund will
not invest more than 10% of the value of their respective net assets in
illiquid securities, including repurchase agreements providing for
settlement more than seven days after notice; and, in the case of U.S.
Government Securities Fund, Stock Fund, and Small Company Stock Fund,
including over-the-counter options; in the case of Prime Money Market
Fund, U.S. Government Securities Fund, Stock Fund, and Small Company Stock
Fund, including certain restricted securities not determined by the
Trustees to be liquid; and, in the case of Prime Money Market Fund, non-
negotiable fixed income time deposits with maturities over seven days.

Investing in Securities of Other Investment Companies

Unless permitted by order of the Securities and Exchange Commission, the
Funds will limit their respective investment in other investment companies
to no more than 3% of the total outstanding voting stock of any investment
company, and will not invest more than 5% of their respective total assets
in any one investment company, or invest more than 10% of their respective
total assets in investment companies in general. U.S. Treasury Money
Market Fund and Prime Money Market Fund will limit their investments in
the securities of other investment companies to those of money market
funds having investment objectives and policies similar to their own. The
Funds will purchase securities of closed-end investment companies only in
open market transactions involving only customary broker's commissions.
However, these limitations are not applicable if the securities are
acquired in a merger, consolidation, reorganization, or acquisition of
assets.

Arbitrage Transactions

A Fund will not enter into transactions for the purpose of engaging in
arbitrage.

Options and Related Transactions

A Fund will not purchase put or call options on securities or on futures
contracts, except that U.S. Government Securities Fund, Stock Fund and
Small Company Stock Fund may engage in put and call options, futures and
options on futures.

Purchasing Securities to Exercise Control

A Fund will not purchase securities of a company for the purpose of
exercising control or management.

Investing in Warrants

The Funds will not invest in warrants, except that Stock Fund and Small
Company Stock Fund may invest not more than 5% of their respective net
assets in warrants, including those acquired in units or attached to other
securities. For purposes of this investment restriction, warrants will be
valued at the lower of cost or market, except that warrants acquired by
the Funds in units with or attached to securities may be deemed to be
without value.

Except with respect to the Funds' policy of borrowing money, if a percentage
limitation is adhered to at the time of investment, a later increase or decrease
in percentage resulting from any change in value or net assets will not result
in a violation of such restriction. The Funds did not borrow money or pledge
securities in excess of 5% of the value of their respective net assets in the
last fiscal year and have no present intent to do so in the coming fiscal year.

For purposes of their policies and limitations, the Funds consider certificates
of deposit and demand and time deposits issued by a U.S. branch of a domestic
bank or savings association having capital, surplus, and undivided profits in
excess of $100,000,000 at the time of investment to be "cash items."

Regulatory Compliance

The Prime Money Market Fund may follow non-fundamental operational policies that
are more restrictive than its fundamental investment limitations, as set forth
in its prospectus and this Statement of Additional Information, in order to
comply with applicable laws and regulations, including the provisions of and
regulations under the Investment Company Act of 1940. In particular, the Fund
will comply with the various requirements of Rule 2a- 7, which regulates money
market mutual funds. For example, with limited exceptions, Rule 2a-7 prohibits
the investment of more than 5% of the Fund's total assets in the securities of
any one issuer, although the Fund's investment limitation only requires such 5%
diversification with respect to 75% of its assets. The Fund will invest more
than 5% of its assets in any one issuer only under circumstances permitted by
Rule 2a-7. The Fund will also determine the effective maturity of its
investments, as well as its ability to consider a security as having received
the requisite short-term ratings by NRSROs, according to Rule 2a-7. The Fund may
change these operational policies to reflect changes in the laws and regulations
without the approval of its shareholders.

Riggs Funds Management
Officers and Trustees are listed with their addresses, birthdates, present
positions with Riggs Funds, and principal occupations.

John F. Donahue@*
Federated Investors Tower
Pittsburgh, PA
Birthdate: July 28, 1924

Chairman and Trustee

Chairman and Trustee, Federated Investors, Inc., Federated Advisers, Federated
Management, and Federated Research; Chairman and Director, Federated Research
Corp. and Federated Global Research Corp.; Chairman, Passport Research, Ltd.;
Chief Executive Officer and Director or Trustee of the Funds. Mr. Donahue is the
father of J. Christopher Donahue, Executive Vice President of the Company.

Thomas G. Bigley
15 Old Timber Trail
Pittsburgh, PA
Birthdate: February 3, 1934

Trustee

Director, Member of Executive Committee, Children's Hospital of Pittsburgh;
formerly, Senior Partner, Ernst & Young LLP; Director, MED 3000 Group, Inc.;
Director, Member of Executive Committee, University of Pittsburgh; Director or
Trustee of the Funds.

Nicholas P. Constantakis
175 Woodshire Drive
Pittsburgh, PA

Birthdate: September 3, 1939

Trustee

Formerly, Partner, Anderson Worldwide SC; Director or Trustee of the Funds.

John T. Conroy, Jr.
Wood/IPC Commercial Department
John R. Wood and Associates, Inc., Realtors
3255 Tamiami Trail North
Naples, FL
Birthdate: June 23, 1937

Trustee

President, Investment Properties Corporation; Senior Vice-President, John R.
Wood and Associates, Inc., Realtors; Partner or Trustee in private real estate
ventures in Southwest Florida; formerly, President, Naples Property Management,
Inc. and Northgate Village Development Corporation; Director or Trustee of the
Funds.

William J. Copeland
One PNC Plaza - 23rd Floor
Pittsburgh, PA
Birthdate: July 4, 1918

Trustee

Director and Member of the Executive Committee, Michael Baker, Inc.; formerly,
Vice Chairman and Director, PNC Bank, N.A., and PNC Bank Corp.; Director, Ryan
Homes, Inc.; Director or Trustee of the Funds.

James E. Dowd
571 Hayward Mill Road
Concord, MA
Birthdate: May 18, 1922

Trustee

Attorney-at-law; Director, The Emerging Germany Fund, Inc.; Director or Trustee
of the Funds.

Lawrence D. Ellis, M.D.*
3471 Fifth Avenue, Suite 1111
Pittsburgh, PA
Birthdate: October 11, 1932

Trustee

Professor of Medicine, University of Pittsburgh; Medical Director, University of
Pittsburgh Medical Center - Downtown; Member, Board of Directors, University of
Pittsburgh Medical Center; formerly, Hematologist, Oncologist, and Internist,
Presbyterian and Montefiore Hospitals; Director or Trustee of the Funds.

Edward L. Flaherty, Jr.@
Miller, Ament, Henny & Kochuba
205 Ross Street
Pittsburgh, PA
Birthdate: June 18, 1924

Trustee

Attorney of Counsel, Miller, Ament, Henny & Kochuba; Director, Eat'N Park
Restaurants, Inc.; formerly, Counsel, Horizon Financial, F.A., Western Region;
Director or Trustee of the Funds.

Edward C. Gonzales *
Federated Investors Tower
Pittsburgh, PA
Birthdate: October 22, 1930

President, Treasurer and Trustee

Vice Chairman, Treasurer, and Trustee, Federated Investors, Inc.; Vice
President, Federated Advisers, Federated Management, Federated Research,
Federated Research Corp., Federated Global Research Corp. and Passport Research,
Ltd.; Executive Vice President and Director, Federated Securities Corp.;
Trustee, Federated Shareholder Services Company; Trustee or Director of some of
the Funds; President, Executive Vice President and Treasurer of some of the
Funds.

Peter E. Madden
One Royal Palm Way
100 Royal Palm Way
Palm Beach, FL
Birthdate: March 16, 1942

Trustee

Consultant; Former State Representative, Commonwealth of Massachusetts;
formerly, President, State Street Bank and Trust Company and State Street Boston
Corporation; Director or Trustee of the Funds.

John E. Murray, Jr., J.D., S.J.D.
President, Duquesne University
Pittsburgh, PA
Birthdate: December 20, 1932

Trustee

President, Law Professor, Duquesne University; Consulting Partner, Mollica &
Murray; Director or Trustee of the Funds.

Wesley W. Posvar
1202 Cathedral of Learning
University of Pittsburgh
Pittsburgh, PA
Birthdate: September 14, 1925

Trustee

Professor, International Politics; Management Consultant; Trustee, Carnegie
Endowment for International Peace, RAND Corporation, Online Computer Library
Center, Inc., National Defense University and U.S. Space Foundation; President
Emeritus, University of Pittsburgh; Founding Chairman, National Advisory Council
for Environmental Policy and Technology, Federal Emergency Management Advisory
Board and Czech Management Center, Prague; Director or Trustee of the Funds.

Marjorie P. Smuts
4905 Bayard Street
Pittsburgh, PA
Birthdate: June 21, 1935

Trustee

Public Relations/Marketing/Conference Planning; Director or Trustee of the
Funds.

J. Christopher Donahue
Federated Investors Tower
Pittsburgh, PA
Birthdate: April 11, 1949

Executive Vice President

President and Trustee, Federated Investors, Inc., Federated Advisers, Federated
Management, and Federated Research; President and Director, Federated Research
Corp. and Federated Global Research Corp.; President, Passport Research, Ltd.;
Trustee, Federated Shareholder Services Company and Federated Shareholder
Services; Director, Federated Services Company; President or Executive Vice
President of the Funds; Director or Trustee of some of the Funds. Mr. Donahue is
the son of John F. Donahue, Chairman and Trustee of the Company.

John W. McGonigle
Federated Investors Tower
Pittsburgh, PA
Birthdate: October 26, 1938

Executive Vice President and Secretary

Executive Vice President, Secretary, and Trustee, Federated Investors, Inc.;
Trustee, Federated Advisers, Federated Management, and Federated Research;
Director, Federated Research Corp. and Federated Global Research Corp.; Trustee,
Federated Shareholder Services Company; Director, Federated Services Company;
President and Trustee, Federated Shareholder Services; Director, Federated
Securities Corp.; Executive Vice President and Secretary of the Funds; Treasurer
of some of the Funds.

Richard B. Fisher
Federated Investors Tower
Pittsburgh, PA
Birthdate: May 17, 1923

Vice President

Executive Vice President and Trustee, Federated Investors, Inc.; Chairman and
Director, Federated Securities Corp.; President or Vice President of some of the
Funds; Director or Trustee of some of the Funds.

Joseph S. Machi
Federated Investors Tower
Pittsburgh, PA

Birthdate: May 22, 1962

Vice President and Assistant Treasurer

Vice President and Assistant Treasurer of some of the Funds.

* This Trustee is deemed to be an "interested person" as defined in the
Investment
Company Act of 1940.

@ Member of the Executive Committee. The Executive Committee of the Board
of Trustees handles the responsibilities of the Board between meetings of the
Board.

Officers and Directors own less than 1% of the Fund's outstanding Shares.

As used in the table above, "The Funds" and "Funds" mean the following
investment companies: 111 Corcoran Funds; Automated Government Money Trust;
Blanchard Funds; Blanchard Precious Metals Fund, Inc.; Cash Trust Series II;
Cash Trust Series, Inc.; DG Investor Series; Edward D. Jones & Co. Daily
Passport Cash Trust; Federated Adjustable Rate U.S. Government Fund, Inc.;
Federated American Leaders Fund, Inc.; Federated ARMs Fund; Federated Core
Trust; Federated Equity Funds; Federated Equity Income Fund, Inc.; Federated
Fund for U.S. Government Securities, Inc.; Federated GNMA Trust; Federated
Government Income Securities, Inc.; Federated Government Trust; Federated High
Income Bond Fund, Inc.; Federated High Yield Trust; Federated Income Securities
Trust; Federated Income Trust; Federated Index Trust; Federated Institutional
Trust; Federated Insurance Series; Federated Investment Portfolios; Federated
Investment Trust; Federated Master Trust; Federated Municipal Opportunities
Fund, Inc.; Federated Municipal Securities Fund, Inc.; Federated Municipal
Trust; Federated Short-Term Municipal Trust; Federated Short-Term U.S.
Government Trust; Federated Stock and Bond Fund, Inc.; Federated Stock Trust;
Federated Tax-Free Trust; Federated Total Return Series, Inc.; Federated U.S.
Government Bond Fund; Federated U.S. Government Securities Fund: 1-3 Years;
Federated U.S. Government Securities Fund: 2-5 Years; Federated U.S. Government
Securities Fund: 5-10 Years; Federated Utility Fund, Inc.; First Priority Funds;
Fixed Income Securities, Inc.; High Yield Cash Trust; Intermediate Municipal
Trust; International Series, Inc.; Investment Series Funds, Inc.; Investment
Series Trust; Liberty Term Trust, Inc. - 1999; Liberty U.S. Government Money
Market Trust; Liquid Cash Trust; Managed Series Trust; Money Market Management,
Inc.; Money Market Obligations Trust; Money Market Obligations Trust II; Money
Market Trust; Municipal Securities Income Trust; Newpoint Funds; RIMCO Monument
Funds; Targeted Duration Trust; Tax-Free Instruments Trust; The Planters Funds;
The Virtus Funds; Trust for Financial Institutions; Trust for Government Cash
Reserves; Trust for Short-Term U.S. Government Securities; Trust for U.S.
Treasury Obligations; WesMark Funds; WCT Funds; and World Investment Series,
Inc.

Fund Ownership

Officers and Trustees own less than 1% of the outstanding shares of each Fund.
The following list indicates the beneficial ownership of shareholders who are
the beneficial owners of more than 5% of the outstanding shares of the following
Funds, as of June 22, 1998, Riggs Bank N.A., Washington, D.C., acting in various
capacities for numerous accounts, owned of record, approximately: 70,602,650
Class Y Shares (60.42%) of U.S. Treasury Money Market Fund; 228,241,127 Class Y
Shares (74.57%) of Prime Money Market Fund; 573,000 Class R Shares (45.49%) of
Prime Money Market Fund; 2,855,705 Class R Shares (79.87%) of U.S. Government
Securities Fund; 4,260,658 Class R Shares (62.52%) of Stock Fund; and 2,460,344
Class R Shares (81.96%) of Small Company Stock Fund. Hare & Co., New York, NY,
owned approximately 16,503,173 Class Y Shares (14.12%) of U.S. Treasury Money
Market Fund; Monumental Investment Group Profit Sharing Plan, Washington, D.C.,
owned approximately 10,674,017 Class Y Shares (9.14%) of U.S. Treasury Money
Market Fund; Mary Jo O'Connor, Bethesda, MD, owned approximately 245,245 Class Y
Shares (19.47%) of Prime Money Market Fund; James B. Shank, Alexandria, VA,
owned approximately 149,900 Class Y Shares (11.90%) of Prime Money Market Fund;
and Donald H. Platt and Celia H. Platt owned approximately 98,285 Class Y Shares
of Prime Money Market Fund. Collier Shannon Profit Sharing, Washington, D.C.,
owned approximately 414,047 Class R Shares (6.08%) of Stock Fund.

Trustees Compensation

AGGREGATE
NAME, COMPENSATION
POSITION WITH FROM
TRUST TRUST*#

John F. Donahue
Chairman and Trustee $0

Thomas G. Bigley
Trustee $1,554

Nicholas Constantakis
Trustee $381

John T. Conroy, Jr.
Trustee $1,710

William J. Copeland
Trustee $1,710

James E. Dowd
Trustee $1,710

Lawrence D. Ellis, M.D.
Trustee $1,554

Edward L. Flaherty, Jr.
Trustee $1,710

Edward C. Gonzales
President, Treasurer and Trustee $0

Peter E. Madden
Trustee $1,554

John E. Murray, Jr.
Trustee $1,554

Wesley W. Posvar
Trustee $1,554

Marjorie P. Smuts
Trustee $1,554

* Information is furnished for the fiscal year ended April 30, 1998.

# The aggregate compensation is provided for the Trust which is comprised of
five portfolios.

Trustee Liability

The Trust's Declaration of Trust provides that the Trustees will not be liable
for errors of judgment or mistakes of fact or law. However, they are not
protected against any liability to which they would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of their office.

Massachusetts Partnership Law

Under certain circumstances, shareholders may be held personally liable as
partners under Massachusetts law for acts or obligations of the Trust. To
protect shareholders, the Trust has filed legal documents with Massachusetts
that expressly disclaim the liability of shareholders for such acts or
obligations of the Trust. These documents require notice of this disclaimer to
be given in each agreement, obligation, or instrument the Trust or its Trustees
enter into or sign.

In the unlikely event a shareholder is held personally liable for obligations of
the Trust, the Trust is required to use its property to protect or to compensate
the shareholder. On request, the Trust will defend any claim made and pay any
judgment against a shareholder for any act or obligation of the Trust.
Therefore, financial loss resulting from liability as a shareholder will occur
only if the Trust cannot meet its obligations to indemnify shareholders and to
pay judgments against them from its assets.

Investment Advisory Services
Adviser to the Trust

The Trust's investment adviser is Riggs Investment Management Corporation
("RIMCO"). It is a subsidiary of Riggs Bank N.A. ("Riggs Bank"). The adviser
shall not be liable to the Trust, a Fund, or any shareholder of any of the Funds
for any losses that may be sustained in the purchase, holding, or sale of any
security or for anything done or omitted by it, except acts or omissions
involving willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties imposed upon it by its contract with the Trust.

Because of the internal controls maintained by Riggs Bank to restrict the flow
of non-public information, Fund investments are typically made without any
knowledge of Riggs Bank or its affiliates' lending relationships with an issuer.

Advisory Fees

For its advisory services, Riggs Investment Management Corp. receives an annual
investment advisory fee as described in the prospectus. For the years ended
April 30, 1998, 1997 and 1996, the adviser earned fees from the U.S. Treasury
Money Market Fund of $704,027, $672,065, and $484,117, respectively, of which
$119,268, $173,436, and $174,327, respectively, were waived. For the years ended
April 30, 1998, 1997 and 1996, the adviser earned fees from the Prime Money
Market Fund of $1,803,267, $1,954,745, and $1,644,269, respectively, of which
$409,724, $676,608, and $637,538, respectively, were waived. For the years ended
April 30, 1998, 1997 and 1996, the adviser earned fees from the U.S. Government
Securities Fund of $246,668, $255,588, and $369,027, respectively, of which
$131,556, $136,314, and $196,769, respectively, were waived. For the years ended
April 30, 1998, 1997 and 1996, the adviser earned fees from the Stock Fund of
$790,694, $622,704, and $587,141, respectively, of which $78,554, $99,633, and
$93,942, respectively, were waived. For the years ended April 30, 1998 1997, and
1996, the adviser earned fees from the Small Company Stock Fund of $338,723,
$184,690, and $119,209, respectively, of which $36,697, $105,949, and 119,209,
respectively, were waived.

Administrative Services
Federated Administrative Services, which is a subsidiary of Federated Investors,
Inc., provides administrative personnel and services to the Funds for the fees
set forth in the prospectus. For the years ended April 30, 1998, 1997 and 1996,
Federated Administrative Services earned from the U.S. Treasury Money Market
Fund fees equal to $186,366, $171,345, and $128,886, respectively. For the years
ended April 30, 1998, 1997 and 1996, Federated Administrative Services earned
from Prime Money Market Fund fees equal to $478,888, $497,453, and $436,703,
respectively. For the years ended April 30, 1998, 1997 and 1996, Federated
Administrative Services earned from the U.S. Government Securities Fund fees
equal to $48,888, $51,473, and $65,580, respectively. For the years ended April
30 1998, 1997 and 1996, Federated Administrative Services earned from the Stock
Fund fees equal to $139,892, $106,088, and $104,255, respectively. For the years
ended April 30, 1998 and 1997, and 1996, Federated Administrative Services
earned from the Small Company Stock Fund fees equal to $58,191, $49,978, and
$49,999, of which $0, $0, and $0, respectively, were waived.

Federated Shareholder Services Company ("FServ"), a subsidiary of Federated
Services Company, is the Funds' portfolio accountant, transfer agent and
dividend disbursing agent. For the years ended April 30, 1998, 1997 and 1996,
FServ received from the U.S. Treasury Money Market Fund fees equal to $56,082,
$68,994, and $70,342, respectively. For the years ended April 30, 1998, 1997 and
1996, FServ received from the Prime Money Market Fund fees equal to $130,369,
$148,946, and $125,748, respectively. For the years ended April 30, 1998, 1997
and 1996, FServ received from the U.S. Government Securities Fund fees equal to
$59,058, $88,771, and $87,184, respectively. For the years ended April 30, 1998,
1997 and, 1996, FServ received from the Stock Fund fees equal to $71,317,
$92,259, and $91,020, respectively. For the years ended April 30, 1998, 1997 and
1996, FServ received from the Small Company Stock Fund fees equal to $53,392,
$71,963, and $72,034, respectively.

Custodian

For its service as custodian, Riggs Bank may receive an annual fee, payable
monthly based upon the Funds' average aggregate daily net assets. In addition,
Riggs Bank is reimbursed for its out-of-pocket expenses.

Transfer Agent, Dividend Disbursing Agent and Portfolio Accounting Services

Through its subsidiary Federated Shareholder Services Company, Pittsburgh,
Pennsylvania, Federated Services Company is transfer agent for the shares of the
Funds and dividend disbursing agent for the Funds. Federated Shareholder
Services Company also provides certain accounting and recordkeeping services
with respect to the portfolio investments of the Funds.

Independent Auditors

The independent auditors for the Funds are Ernst & Young LLP, Pittsburgh,
Pennsylvania.

Brokerage Transactions
When selecting brokers and dealers to handle the purchase and sale of portfolio
instruments, the adviser looks for prompt execution of the order at a favorable
price. In working with dealers, the adviser will generally use those who are
recognized dealers in specific portfolio instruments, except when a better price
and execution of the order can be obtained elsewhere. The adviser makes
decisions on portfolio transactions and selects brokers and dealers subject to
guidelines established by the Board of Trustees. The adviser may select brokers
and dealers who offer brokerage and research services. These services may be
furnished directly to the Funds or to the adviser and may include: advice as to
the advisability of investing in securities; security analysis and reports;
economic studies; industry studies; receipt of quotations for portfolio
evaluations; and similar services. Research services provided by brokers may be
used by the adviser in advising the Funds and other accounts. To the extent that
receipt of these services may supplant services for which the adviser or its
affiliates might otherwise have paid, it would tend to reduce their expenses.
The adviser and its affiliates exercise reasonable business judgment in
selecting brokers who offer brokerage and research services to execute
securities transactions. They determine in good faith that commissions charged
by such persons are reasonable in relationship to the value of the brokerage and
research services provided.

For the fiscal years ended April 30, 1998, 1997 and 1996, the Stock Fund paid
total brokerage commissions of $245,522, $175,381, and $170,312, respectively.
For the years ended April 30, 1998, 1997 and 1996, the Small Company Stock Fund
paid total brokerage commissions of $107,288, $72,366, and $47,188,
respectively.

Although investment decisions for the Funds are made independently from those of
the other accounts managed by the adviser, investments of the type the Funds may
make may also be made by those other accounts. When the Funds and one or more
other accounts managed by the adviser are prepared to invest in, or desire to
dispose of, the same security, available investments or opportunities for sales
will be allocated in a manner believed by the adviser to be equitable to each.
In some cases, this procedure may adversely affect the price paid or received by
the Funds or the size of the position obtained or disposed of by the Funds. In
other cases, however, it is believed that coordination and the ability to
participate in volume transactions will be to the benefit of the Funds.

Purchasing Shares
Shares of the Funds are sold at their net asset value. Shares of the Funds are
sold on days on which both the New York Stock Exchange and the Federal Reserve
wire are open for business. The procedure for purchasing shares of the Funds is
explained in the prospectus under "Investing in the Funds."

Distribution Plan and Shareholder Services Plan

These arrangements permit the payment of fees to financial institutions, the
distributor, and Federated Shareholder Services, to stimulate distribution
activities and to cause services to be provided to shareholders by a
representative who has knowledge of the shareholder's particular circumstances
and goals. These activities and services may include, but are not limited to:
marketing efforts; providing office space, equipment, telephone facilities, and
various clerical, supervisory, computer, and other personnel as necessary or
beneficial to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic investments of
client account cash balances; answering routine client inquiries; and assisting
clients in changing dividend options, account designations, and addresses.

By adopting the Distribution Plan, the Trustees expect that shares of the Funds
will be able to achieve a more predictable flow of cash for investment purposes
and to meet redemptions. This will facilitate more efficient portfolio
management and assist the Funds in pursuing their respective investment
objective. By identifying potential investors whose needs are served by a Fund's
objective, and properly servicing these accounts, the Fund may be able to curb
sharp fluctuations in rates of redemptions and sales.

By adopting the Shareholder Services Plan, the Trustees expect that the Funds
will benefit by: (1) providing personal services to shareholders; (2) investing
shareholder assets with a minimum of delay and administrative detail; and (3)
enhancing shareholder recordkeeping systems; and (4) responding promptly to
shareholders' requests and inquiries concerning their accounts.

For the year ended April 30, 1998, payment in the amount of $30,652 was made
pursuant to the Plan for Class R Shares of Prime Money Market Fund.

Conversion to Federal Funds

It is the Funds' policy to be as fully invested as possible so that maximum
interest or dividends may be earned. To this end, all payments from shareholders
must be in federal funds or be converted into federal funds. Riggs Bank acts as
the shareholder's agent in depositing checks and converting them to federal
funds.

Determining Net Asset Value
U.S. Treasury Money Market Fund and Prime Money Market Fund attempt to stabilize
the value of their respective shares at $1.00. Net asset values of U.S.
Government Securities Fund, Stock Fund and Small Company Stock Fund generally
change each day. The days on which the net asset value is calculated by these
Funds are described in the prospectus.

Determining Market Value of Securities

The market value of U.S. Government Securities Fund's, Stock Fund's, and Small
Company Stock Fund's portfolio securities are determined as follows:

o for equity securities, according to the last sale price on a national
securities exchange, if available;

o in the absence of recorded sales for listed equity securities, according
to the mean between the last closing bid and asked prices;

o for unlisted equity securities, the latest bid prices;

o for bonds and other fixed income securities, as determined by an
independent pricing service;

o for short-term obligations, according to the mean between bid and asked
prices as furnished by an independent pricing service or for short-term
obligations with remaining maturities of less than 60 days, at the time
of purchase, at amortized cost; or

o for all other securities, at fair value as determined in good faith by
the Board of Trustees.

Prices provided by independent pricing services may be determined without
relying exclusively on quoted prices and may reflect: institutional trading in
similar groups of securities, yield, quality, coupon rate, maturity, type of
issue, trading characteristics, and other market data.

The Funds will value futures contracts, options, and put options on futures and
at their market values established by the exchanges at the close of option
trading on such exchanges unless the Board of Trustees determine in good faith
that another method of valuing option positions is necessary to appraise their
fair value.

Use of the Amortized Cost Method

With respect to U.S. Treasury Money Market Fund and Prime Money Market Fund, the
Trustees have decided that the best method for determining the value of
portfolio instruments is amortized cost. Under this method, portfolio
instruments are valued at the acquisition cost as adjusted for amortization of
premium or accumulation of discount rather than at current market value.

A Fund's use of the amortized cost method of valuing portfolio instruments
depends on its compliance with certain conditions in Rule 2a- 7 (the "Rule")
promulgated by the Securities and Exchange Commission under the Investment
Company Act of 1940. Under the Rule, the Trustees must establish procedures
reasonably designed to stabilize the net asset value per share, as computed for
purposes of distribution and redemption, at $1.00 per share, taking into account
current market conditions and a Fund's investment objective. Under the Rule, a
Fund is permitted to purchase instruments which are subject to demand features
or standby commitments. As defined by the Rule, a demand feature entitles a Fund
to receive the principal amount of the instrument from the issuer or a third
party on (1) no more than 30 days' notice or (2) at specified intervals not
exceeding one year on no more than 30 days' notice. A standby commitment
entitles a Fund to achieve same day settlement and to receive an exercise price
equal to the amortized cost of the underlying instrument plus accrued interest
at the time of exercise.

Monitoring Procedures

The Trustees' procedures include monitoring the relationship between the
amortized cost value per share and the net asset value per share based
upon available indications of market value. The Trustees will decide what,
if any, steps should be taken if there is a difference of more than .50%
between the two values. The Trustees will take any steps they consider
appropriate (such as redemption in kind or shortening the average
portfolio maturity) to minimize any material dilution or other unfair
results arising from differences between the two methods of determining
net asset value.

Investment Restrictions

The Rule requires that a Fund limit its investments to instruments that,
in the opinion of the Board of Trustees, present minimal credit risk and
that, if rated, meet minimum rating standards set forth in the Rule. If
the instruments are not rated, the Trustees must determine that they are
of comparable quality. Shares of investment companies purchased by the
Funds will meet these same criteria and will have investment policies
consistent with Rule 2a- 7. The Rule also requires a Fund to maintain a
dollar-weighted average portfolio maturity (not more than 90 days)
appropriate to the objective of maintaining a stable net asset value of
$1.00 per share. In addition, no instrument with a remaining maturity of
more than 13 months can be purchased by a Fund.

Should the disposition of a portfolio security result in a dollar weighted
average portfolio maturity of more than 90 days, a Fund will invest its
available cash to reduce the average maturity to 90 days or less as soon
as possible.

A Fund may attempt to increase yield by trading portfolio securities to take
advantage of short-term market variations. This policy may, from time to time,
result in high portfolio turnover. Under the amortized cost method of valuation,
neither the amount of daily income nor the net asset value is affected by any
unrealized appreciation or depreciation of the portfolio.

In periods of declining interest rates, the indicated daily yield on shares of a
Fund computed by dividing the annualized daily income on a Fund's portfolio by
the net asset value computed as above may tend to be higher than a similar
computation made by using a method of valuation based upon market prices and
estimates.

In periods of rising interest rates, the indicated daily yield on shares of the
Fund computed the same way may tend to be lower than a similar computation made
by using a method of calculation based upon market prices and estimates.

Redeeming Shares
Each Fund redeems shares at the next computed net asset value after Riggs Bank
receives the redemption request. Redemption procedures are explained in the
prospectus under "Redeeming Shares."

Contingent Deferred Sales Charge

In computing the amount of the applicable contingent deferred sales charge,
redemptions are deemed to have occurred in the following order: (1) shares
acquired through the reinvestment of dividends and long-term capital gains; (2)
shares held for more than five full years from the date of purchase; (3) Shares
held for fewer than five years on a first-in, first-out basis.

Redemption in Kind

Although the Trust intends to redeem shares in cash, it reserves the right under
certain circumstances to pay the redemption price in whole or in part by a
distribution of securities from a Fund's portfolio. To the extent available,
such securities will be readily marketable. Redemption in kind will be made in
conformity with applicable Securities and Exchange Commission rules, taking such
securities at the same value employed in determining net asset value and
selecting the securities in a manner the Board of Trustees determine to be fair
and equitable. The Trust has elected to be governed by Rule 18f-1 of the
Investment Company Act of 1940 under which the Trust is obligated to redeem
shares for any one shareholder in cash only up to the lesser of $250,000 or 1%
of a Fund's net asset value during any 90-day period.

Tax Status
The Funds' Tax Status

The Funds will pay no federal income tax because they expect to meet the
requirements of Subchapter M of the Internal Revenue Code applicable to
regulated investment companies and to receive the special tax treatment afforded
to such companies. To qualify for this treatment, each Fund must, among other
requirements:

o derive at least 90% of its gross income from dividends, interest, and
gains from the sale of securities;

o invest in securities within certain statutory limits; and

o distribute to its shareholders at least 90% of its net income earned
during the year.

Shareholders' Tax Status

Shareholders are subject to federal income tax on dividends received as cash or
additional shares. With respect to the U.S. Treasury Money Market Fund, Prime
Money Market Fund, and U.S. Government Securities Fund, no portion of any income
dividend paid by a Fund is expected to be eligible for the dividends received
deduction available to corporations. With respect to the Stock Fund and the
Small Company Stock Fund, the dividends received deduction for corporations will
apply to ordinary income distributions to the extent the distribution represents
amounts that would qualify for the dividends received deduction to a particular
fund if that fund were a regular corporation and to the extent designed by a
fund as so qualifying. These dividends, and any short-term capital gains, are
taxable as ordinary income.

Capital Gains

Capital gains experienced by U.S. Treasury Money Market Fund and Prime Money
Market Fund could result in an increase in dividends. Capital losses could
result in a decrease in dividends. If for some extraordinary reason these Funds
realize net long-term capital gains, such net long-term capital gains will be
distributed at least once every 12 months.

With respect to U.S. Government Securities Fund, Stock Fund, and Small Company
Stock Fund, long- term capital gains distributed to shareholders will be treated
as long-term capital gains regardless of how long shareholders have held shares.

Total Return
The U.S. Government Securities Fund's average annual total returns for the
one-year, five-year, and since inception (May 11, 1992) periods ended April 30,
1998 were 4.90%, 5.13% and 6.45%, respectively.

The Stock Fund's Class R Shares' average annual total returns for the one-year,
five-year, and since inception (May 11, 1992) periods ended April 30, 1998 were
31.65%, 22.51% and 19.83%, respectively.

The Small Company Stock Fund's Class R Shares' average annual total returns for
the one-year and since inception (February 27, 1995) periods ended April 30,
1998, were 67.64% and 31.79%, respectively.

The Funds' average annual total return is the average compounded rate of return
for a given period that would equate a $1,000 initial investment to the ending
redeemable value of that investment. The ending redeemable value is computed by
multiplying the number of shares owned at the end of the period by the net asset
value per share at the end of the period. The number of shares owned at the end
of the period is based on the number of shares purchased at the beginning of the
period with $1,000, less any applicable sales charge, adjusted over the period
by any additional shares, assuming the monthly or quarterly, as applicable,
reinvestment of all dividends and distributions.

Yield
The yield for the seven-day period ended April 30, 1998 for the Class Y Shares
of U.S. Treasury Money Market Fund was 4.74%.

The yields for the seven-day period ended April 30, 1998 for the Class R Shares
and Class Y Shares of Prime Money Market Fund were 4.76% and 5.01%,
respectively.

The yield for the thirty-day period ended April 30, 1998 for the Class R Shares
of U.S. Government Securities Fund was 5. 67%.

The yield for the thirty-day period ended April 30, 1998 for the Class R Shares
of Stock Fund was 0.41%.

The yield for the thirty-day period ended April 30, 1998 for the Class R Shares
of Small Company Stock Fund was 0.00%.

U.S. Treasury Money Market Fund and Prime Money Market Fund calculate yield
daily, based upon the seven days ending on the day of the calculation, called
the "base period." This yield is computed by:

o determining the net change in the value of a hypothetical account with a
balance of one share at the beginning of the base period, with the net
change excluding capital changes but including the value of any
additional shares purchased with dividends earned from the original one
share and all dividends declared on the original and any purchased
shares;

o dividing the net change in the account's value by the value of the
account at the beginning of the base period to determine the base period
return; and

o multiplying the base period return by 365/7.

The yield for U.S. Government Securities Fund, Stock Fund, and Small Company
Stock Fund is determined by dividing the net investment income per share (as
defined by the Securities and Exchange Commission) earned by the Fund over a
thirty- day period by the maximum offering price per share of the Fund on the
last day of the period. This value is then annualized using semi- annual
compounding. This means that the amount of income generated during the
thirty-day period is assumed to be generated each month over a twelve-month
period and is reinvested every six months. The yield does not necessarily
reflect income actually earned by the Fund because of certain adjustments
required by the Securities and Exchange Commission and, therefore, may not
correlate to the dividends or other distributions paid to shareholders.

To the extent that financial institutions and broker/dealers charge fees in
connection with services provided in conjunction with an investment in a Fund,
the performance will be reduced for those shareholders paying those fees.

Effective Yield
The effective yield for the seven-day period ended April 30, 1997 for the Class
Y Shares of U.S. Treasury Money Market Fund was 4.85%.

The effective yields for the seven-day period ended April 30, 1997 for the Class
R Shares and Class Y Shares of Prime Money Market Fund were 4.87% and 5.14%,
respectively

The effective yield of U.S. Treasury Money Market Fund and Prime Money Market
Fund is computed by compounding the unannualized base period return by:

adding 1 to the base period return;

raising the sum to the 365/7th power; and

subtracting 1 from the result.

Performance Comparisons
Each Fund's performance depends upon such variables as:

o portfolio quality;

o average portfolio maturity;

o type of instruments in which the portfolio is invested;

o changes in interest rates on money market instruments in the case of
U.S. Treasury Money Market Fund and Prime Money Market Fund, or
changes in interest rates and market value of portfolio securities in
the case of U.S. Government Securities Fund, Stock Fund and Small
Company Stock Fund;

o changes in each Fund's expenses; and

o the relative amount of each Fund's cash flow.

Advertising and other promotional literature may include charts, graphs and
other illustrations using the Funds' returns, or returns in general, that
demonstrate basic investment concepts such as tax-deferred compounding,
dollar-cost averaging and systematic investment. In addition, the Funds can
compare their performance, or performance for the types of securities in which
they invest, to a variety of other investments, such as bank savings accounts,
certificates of deposit, and Treasury bills.

Economic and Market Information

Advertising and sales literature for the Funds may include discussions of
economic, financial and political developments and their effect on the
securities market. Such discussions may take the form of commentary on these
developments by Funds' portfolio managers and their views and analysis on how
such developments could affect the Funds. In addition, advertising and sales
literature may quote statistics and give general information about the mutual
fund industry, including the growth of the industry, from sources such as the
Investment Company Institute ("ICI"). For example, according to the ICI,
thirty-seven percent of American households are pursuing their financial goals
through mutual funds. These investors, as well as businesses and institutions,
have entrusted over $4.4 trillion to the more than 6,700 funds available.

Investors may use financial publications and/or indices to obtain a more
complete view of the Funds' performance. When comparing performance, investors
should consider all relevant factors such as the composition of any index used,
prevailing market conditions, portfolio compositions of other funds, and methods
used to value portfolio securities and compute offering price. The financial
publications and/or indices which the Funds use in advertising may include:

Consumer Price Index (CPI) is the measure of change in consumer prices, as
determined by a monthly survey of the U.S. Bureau of Labor Statistics. Many
pension and employment contracts are tied to changes in consumer prices, as
protection against inflation and reduced purchasing power. Among the CPI
components are housing costs, food, transportation, and electricity. The CPI is
also known as the cost-of-living index.

U.S. Treasury Money Market Fund:

o Lipper Analytical Services, Inc., ranks funds in various fund categories
by making comparative calculations using total return. Total return
assumes the reinvestment of all income dividends and capital gains
distributions, if any. From time to time, the Fund will quote its Lipper
ranking in advertising and sales literature.

o Salomon 30-Day Treasury Bill Index is a weekly quote of the most
representative yields for selected securities, issued by the U.S.
Treasury, maturing in 30 days.

o Money, a monthly magazine, regularly ranks money market funds in various
categories based on the latest available seven-day compound (effective)
yield. From time to time, the Fund will quote its Money ranking in
advertising and sales literature.

Prime Money Market Fund:

o Lipper Analytical Services, Inc., ranks funds in various fund categories
by making comparative calculations using total return. Total return
assumes the reinvestment of all capital gains distributions and income
dividends, if any. From time to time, the Fund will quote its Lipper
ranking in advertising and sales literature.

o Bank Rate Monitor National Index, Miami Beach, Florida, is a financial
reporting service which publishes weekly average rates of 50 leading
bank and thrift institution money market deposit accounts. The rates
published in the index are an average of the personal account rates
offered on the Wednesday prior to the date of publication by ten of the
largest banks and thrifts in each of the five largest Standard
Metropolitan Statistical Areas. Account minimums range upward from
$2,500 in each institution and compounding methods vary. If more than
one rate is offered, the lowest rate is used. Rates are subject to
change at any time specified by the institution.

o Salomon 30-Day Treasury Bill Index is a weekly quote of the most
representative yields for selected securities, issued by the U.S.
Treasury, maturing in 30 days.

U.S. Government Securities Fund:

o Lehman Brothers Government Index is an unmanaged index comprised of all
publicly issued, non-convertible domestic debt of the U.S. government,
or any agency thereof, or any quasi-federal corporation and of corporate
debt guaranteed by the U.S. government. Only notes and bonds with a
minimum outstanding principal of $1 million and a minimum maturity of
one year are included.

o Lehman Brothers Government/Corporate (Total) Index is comprised of
approximately 5,000 issues which include non-convertible bonds publicly
issued by the U.S. government or its agencies; corporate bonds
guaranteed by the U.S. government and quasi-federal corporations; and
publicly issued, fixed rate, non-convertible domestic bonds of companies
in industry, public utilities and finance. The average maturity of these
bonds approximates nine years. Tracked by Shearson Lehman Brothers,
Inc., the index calculates total returns for one month, three month,
twelve month and ten year periods and year-to-date.

o Lipper Analytical Services, Inc., ranks funds in various fund categories
using total return. Total return assumes the reinvestment of all capital
gains distributions and income dividends and takes into account any
change in net asset value over a specific period of time. From time to
time, the Fund will quote its Lipper ranking in advertising and sales
literature.

o Lehman Brothers Aggregate Bond Index is a total return index measuring
both the capital price changes and income provided by the underlying
universe of securities, weighted by market value outstanding. The
Aggregate Bond Index is comprised of the Shearson Lehman Government Bond
Index, Corporate Bond Index, Mortgage- Backed Securities Index and the
Yankee Bond Index. These indices include: U.S. Treasury obligations,
including bonds and notes; U.S. agency obligations, including those of
the Federal Farm Credit Bank, Federal Land Bank and the Bank for
Co-Operatives; foreign obligations, U.S. investment grade corporate debt
and mortgage-backed obligations. All corporate debt included in the
Aggregate Bond Index has a minimum S&P rating of BBB, a minimum Moody's
rating of Baa, or a minimum Fitch rating of BBB.

o Merrill Lynch Corporate and Government Index includes issues which must
be in the form of publicly placed, nonconvertible, coupon- bearing
domestic debt and must carry a term of maturity of at least one year.
Par amounts outstanding must be no less than $10 million at the start
and at the close of the performance measurement period. Corporate
instruments must be rated by S&P or by Moody's as investment grade
issues (i.e., BBB/Baa or better).

o Merrill Lynch Domestic Master Index includes issues which must be in the
form of publicly placed, nonconvertible, coupon-bearing domestic debt and
must carry a term to maturity of at least one year. Par amounts outstanding
must be no less than $10 million at the start and at the close of the
performance measurement period. The Domestic Master Index is a broader
index than the Merrill Lynch Corporate and Government Index and includes,
for example, mortgage related securities. The mortgage market is divided by
agency, type of mortgage and coupon and the amount outstanding in each
agency/type/coupon subdivision must be no less than $200 million at the
start and at the close of the performance measurement period. Corporate
instruments must be rated by S&P or by Moody's as investment grade issues
(i.e., BBB/Baa or better).

Stock Fund:

o Lipper Analytical Services, Inc., ranks funds in various fund categories
by making comparative calculations using total return. Total return
assumes the reinvestment of all capital gains distributions and income
dividends and takes into account any change in net asset value over a
specific period of time. From time to time, the Fund will quote its
Lipper ranking in advertising and sales literature.

o Dow Jones Industrial Average ("DJIA") represents share prices of
selected blue-chip industrial corporations. The DJIA indicates daily
changes in the average price of stock in these corporations. It also
reports total sales for this group. Because it represents the top
corporations of America, the DJIA index is a leading economic indicator
for the stock market as a whole.

o Standard & Poor's Daily Stock Price Index of 500 Common Stocks, a
composite index of common stocks in industry, transportation, and
financial and public utility companies. The Standard & Poor's index
assumes reinvestment of all dividends paid by stocks listed on the
index. Taxes due on any of these distributions are not included, nor are
brokerage or other fees calculated in the Standard & Poor's figures.

Small Company Stock Fund:

o Lipper Analytical Services, Inc. ranks funds in various fund categories
by making comparative calculations using total return. Total return
assumes the reinvestment of all capital gains distributions and income
dividends and takes into account any change in offering price over a
specific period of time. From time to time, the Fund will quote its
Lipper ranking in the "index funds" category in advertising and sales
literature.

o Morningstar, Inc., an independent rating service, is the publisher of
the bi-weekly Mutual Fund Values. Mutual Fund Values rates more than
1,000 NASDAQ listed mutual funds of all types, according to their
risk-adjusted returns. The maximum rating is five stars, and ratings are
effective for two weeks.

o Russell 2000 Index--is a broadly diversified index consisting of
approximately 2,000 small capitalization common stocks that can be used
to compare to the total returns of funds whose portfolios are invested
primarily in small capitalization stocks.

o Standard & Poor's Small Stock Index, is a broadly diversified,
unmanaged, index consisting of approximately 600 small capitalization
common stocks that can be used to compare to the total returns of funds
whose portfolios are invested primarily in small capitalization common
stocks.

Advertisements and other sales literature for the Funds may quote total returns
which are calculated on non-standardized base periods. These total returns also
represent the historic change in the value of an investment in the Funds based
on monthly reinvestment of dividends over a specified period of time.
Advertisements may quote performance information which does not reflect the
effect of the sales charge of the U.S. Government Securities Fund, Small Company
Stock Fund or Stock Fund. Financial Statements The financial statements for the
fiscal year ended April 30, 1998, are incorporated herein by reference to the
Trust's Annual Report dated April 30, 1998 (File Nos. 33-40428 and 811-6309). A
copy of the Annual Report may be obtained without charge by contacting the Trust
at the address located on the back cover of the prospectus.

<PAGE>

Appendix
Standard & Poor's Corporate Bond Rating Definitions

AAA--Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA--Debt rated AA has a very strong capacity to pay interest and repay principal
and differs from the higher rated issues only in small degree.

A--Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB--Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

NR--NR indicates that no public rating has been requested, that there is
insufficient information on which to base a rating, or that Standard & Poor's
does not rate a particular type of obligation as a matter of policy. Standard
and Poor's may apply a plus (+) or minus (-) to the above rating classifications
to show relative standing within the classifications.

Moody's Investors Service, Inc. Corporate Bond Rating Definitions

AAA--Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edged." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are likely
to change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.

AA--Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high-grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in Aaa securities.

A--Bonds which are rated A possess many favorable investment attributes and are
to be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future. Baa--Bonds which
are rated Baa are considered as medium-grade obligations, i.e., they are neither
highly protected nor poorly secured. Interest payments and principal security
appear adequate for the present but certain protective elements may be lacking
or may be characteristically unreliable over any great length of time. Such
bonds lack outstanding investment characteristics and in fact have speculative
characteristics as well.

NR--Not rated by Moody's.

Moody's applies numerical modifiers, 1, 2, and 3 in each generic rating
classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic rating
category.

Fitch IBCA, Inc. Corporate Bond Rating Definitions

AAA--Bonds considered to be investment grade and of the highest credit quality.
The obligor has an exceptionally strong ability to pay interest and repay
principal, which is unlikely to be affected by reasonably foreseeable events.

AA--Bonds considered to be investment grade and of very high credit quality. The
obligor's ability to pay interest and repay principal is very strong, although
not quite as strong as bonds rated "AAA." Because bonds rated in the "AAA" and
"AA" categories are not significantly vulnerable to foreseeable future
developments, short- term debt of these issuers is generally rated "A1+."

A--Bonds considered to be investment grade and of high credit quality. The
obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.

BBB--Bonds considered to be investment grade and of satisfactory credit quality.
The obligor's ability to pay interest and repay principal is considered to be
adequate. Adverse changes in economic conditions and circumstances, however, are
more likely to have adverse impact on these bonds, and therefore, impair timely
payment. The likelihood that the ratings of these bonds will fall below
investment grade is higher than for bonds with higher ratings.

NR--NR indicates that Fitch does not rate the specific issue.

Plus (+) OR Minus (-): Plus and minus signs are used with a rating symbol to
indicate the relative position of a credit within the rating category. Plus and
minus signs, however, are not used in the "AAA" category.

Standard & Poor's Commercial Paper Rating Definitions

A-1--This highest category indicates that the degree of safety regarding timely
payment is strong. Those issues determined to possess extremely strong safety
characteristics are denoted with a plus (+) designation.

A-2--Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1."

Moody's Investors Service, Inc. Commercial Paper Rating Definitions

Prime-1--Issuers rated Prime-1 (or related supporting institutions) have a
superior capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following characteristics:

o Leading market positions in well-established industries.

o High rates of return on funds employed.

o Conservative capitalization structure with moderate reliance on debt and
ample asset protection.

o Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.

o Well-established access to a range of financial markets and assured
sources of alternate liquidity.

Prime-2--Issuers rated Prime-2 (or related supporting institutions) have a
strong capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above, but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions.
Ample alternate liquidity is maintained.

Fitch IBCA, Inc. Commercial Paper Rating Definitions

Plus or minus signs are used with a rating symbol to indicate the relative
position of the credit within the rating category:

F-1+--Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.

F-1--Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated F1+.