<PAGE>
CRA REALTY SHARES PORTFOLIO
The Advisors' Inner Circle Fund
CLASS A SHARES
AND
INSTITUTIONAL SHARES
SUPPLEMENT DATED MARCH 17, 1997 TO THE PROSPECTUS DATED JANUARY 1, 1997.
The Prospectus is amended and supplemented to update the historical performance
information of CRA Real Estate Securities L.P. (the investment adviser to the
CRA Realty Shares Portfolio) and its predecessors.
The information on page 9 and the first two paragraphs on page 10 of the
Prospectus in the section "THE ADVISER," are replaced by the following:
The following graph presents the composite compounded annual rates of total
return attained by all of the accounts managed by CRA Real Estate Securities
L.P. and its predecessors with investment objectives and policies substantially
similar to those of the Portfolio for the time periods indicated, compared to
the NAREIT--All REITs Index and the Wilshire Real Estate Securities Index.
Past Performance of CRA and its Predecesors
Periods ending December 31, 1996
<TABLE>
<CAPTION>
CRA and its NAREIT - ALL REITS WILSHIRE REAL ESTATE
predecessors INDEX SECURITIES
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1 YEAR 39.8% 35.8% 36.9%
3 YEARS
(Annualized) 20.4% 17.4% 16.5%
5 YEARS
(Annualized) 20.0% 16.6% 14.4%
10 YEARS
(Annualized) 11.0% 9.0% 6.2%
SINCE INCEPTION
(OCT. 1984)
(Annualized) 11.8% 9.8% 8.7%
- ----------------------------------------------------------------------------------------------------------
</TABLE>
* The performance results described above are based on a composite of all
discretionary real estate securities portfolios that were advised by CRA and
its predecessors with investment objectives and policies substantially
similar to those of the Portfolio through December 31, 1996. Audit
Investments, Inc. ("Audit") was formed on January 29, 1969 and began managing
accounts with investment objectives and policies substantially similar to
those of the Portfolio in October, 1984. Audit was reorganized into Campbell
Radnor Advisors on January 1, 1994. Campbell Radnor Advisors was subsequently
reorganized into CRA Real Estate Securities L.P. on March 31, 1995. The same
advisory personnel who have previously managed the discretionary portfolio
accounts at each of the predecessors serve as portfolio managers for the
Portfolio. These accounts were managed by Mr. Campbell through November,
1992; Mr. Ferguson became a co- portfolio manager with Mr. Campbell in
December, 1992; and Messrs. Campbell and Ferguson co-managed the accounts for
all subsequent periods shown. The results are net of the private account
advisory fees and assume the reinvestment of dividends. As of December 31,
1996, CRA had $567.9 million in assets under management, all of which is
represented in the foregoing results.
<PAGE>
The Wilshire and NAREIT indices are unmanaged indices without transaction costs
and are widely recognized as indicators of the performance of the real estate
securities market. The Wilshire Real Estate Securities Index is a market-
weighted index comprised of equity REITs and Real Estate Operating Companies.
The NAREIT index is a market-weighted index comprised of all of the tax-
qualified REITs listed on the New York Stock Exchange, American Stock Exchange
and the NASDAQ National Market System.
Registered investment companies managed by the Adviser, including the
Portfolio, are subject to certain regulatory and tax restrictions on investment
that are not applicable to the Adviser's private accounts. Additionally, the
operating expenses of the Portfolio will be different from, and may be higher
than, the operating expenses of the individual accounts. The performance of CRA
and its predecessors is provided merely to indicate their proficiency in
managing similar investment portfolios. Investors should note that past
performance is no guarantee of future results.
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PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
CRA-A-001-01
2
