<PAGE> PAGE 1
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000 C000000 0000885980
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000 J000000 A
001 A000000 THE YACKTMAN FUNDS, INC.
001 B000000 811-6628
001 C000000 3122011200
002 A000000 303 WEST MADISON STREET
002 B000000 CHICAGO
002 C000000 IL
002 D010000 60606
003 000000 N
004 000000 N
005 000000 N
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007 C010100 1
007 C020100 THE YACKTMAN FUND
007 C030100 N
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007 C020200 THE YACKTMAN FOCUSED FUND
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008 B00AA01 A
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008 D01AA01 CHICAGO
008 D02AA01 IL
008 D03AA01 60606
010 A00AA01 SUNSTONE FINANCIAL GROUP, INC.
010 C01AA01 MILWAUKEE
010 C02AA01 WI
010 C03AA01 53202
012 A00AA01 FIRSTAR MUTUAL FUND SERVICES
012 B00AA01 85-00410
012 C01AA01 MILWAUKEE
012 C02AA01 WI
012 C03AA01 53202
<PAGE> PAGE 2
013 A00AA01 PRICEWATERHOUSECOOPERS LLC
013 B01AA01 MILWAUKEE
013 B02AA01 WI
013 B03AA01 53202
015 A00AA01 FIRSTAR BANK MILWAUKEE
015 B00AA01 C
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015 C02AA01 WI
015 C03AA01 53202
015 E01AA01 X
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020 B000002 13-1912900
020 C000002 180
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020 B000003 13-5108880
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020 B000005 94-1727783
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020 B000007 13-2625874
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020 B000008 37-1303980
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<PAGE> PAGE 3
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<PAGE> PAGE 6
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<PAGE> PAGE 11
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SIGNATURE JON KIEKHOFER
TITLE ADMINISTRATOR
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<DISTRIBUTIONS-OF-INCOME> (6,409,477)
<DISTRIBUTIONS-OF-GAINS> (54,490,030)
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
of The Yacktman Funds, Inc.
In planning and performing our audits of the financial
statements of The Yacktman Fund and The Yacktman
Focused Fund constituting The Yacktman Funds, Inc.
hereafter referred to as the Funds for the year ended
December 31, 1998, we considered their internal control,
including control activities for safeguarding securities, in
order to determine our auditing procedures for the purpose
of expressing our opinion on the financial statements and
to comply with the requirements of Form NSAR, not to
provide assurance on internal control.
The management of the Funds is responsible for
establishing and maintaining internal control. In fulfilling
this responsibility, estimates and judgments by
management are required to assess the expected benefits
and related costs of control activities. Generally, controls
that are relevant to an audit pertain to the entitys objective
of preparing financial statements for external purposes that
are fairly presented in conformity with generally accepted
accounting principles. Those controls include the
safeguarding of assets against unauthorized acquisition,
use or disposition.
Because of inherent limitations in internal control, errors
or fraud may occur and not be detected. Also, projection
of any evaluation of internal control to future periods is
subject to the risk that it may become inadequate because
of changes in conditions or that the effectiveness of the
design and operation may deteriorate.
Our consideration of internal control would not
necessarily disclose all matters in internal control that
might be material weaknesses under standards
established by the American Institute of Certified
Public Accountants. A material weakness is a
condition in which the design or operation of any
specific internal control component does not reduce
to a relatively low level the risk that errors or fraud in
amounts that would be material in relation to the
financial statements being audited may occur and not
be detected within a timely period by employees in
the normal course of performing their assigned
functions. However, we noted no matters involving
internal control, including control activities for
safeguarding securities, that we consider to be
material weaknesses as defined above as of
December 31, 1998.
This report is intended solely for the information and use
of management and the Board of Directors of The
Yacktman Funds, Inc. and the Securities and Exchange
Commission.
PRICEWATERHOUSECOOPERS LLP
Milwaukee, Wisconsin
January 28, 1999
Exhibit to Accompany
Item 77C
Form N-SAR
The Yacktman Funds, Inc.
(the Funds)
RESULTS OF A SPECIAL MEETING OF
SHAREHOLDERS
A special meeting of the shareholders of the Funds
was held on November 24, 1998.
The matters voted on by the shareholders of record
as of October 12, 1998 and the results of the vote
at the shareholder meeting held November 24,
1998 were as follows:
1. Proposal to remove all current directors of
the Funds other than Ronald Ball and
Donald Yacktman
For Against Abstain
21,391,378 2,717,048 180,877
2. Proposal to amend the Funds' bylaws to
reduce the number of directors of the Funds
from six to five
For Against Abstain
21,210,980 2,281,739 256,586
3. Election of Directors
For Withheld
Bruce B. Bingham
21,279,348 3,009,957
Albert J. Malwitz
21,279,348 3,009,957
George J. Stevenson III
21,277,946 3,011,359
*The term of office as Directors of Donald A.
Yacktman and Ronald W. Ball continued after the
meeting.
NM
K:\YACKTMAN\NSAR\1999 filings\Yack9977c.doc
02/26/99
Exhibit to Accompany
Item 77J (b)
Form N-SAR
The Yacktman Funds, Inc.
(the Funds)
According to the provisions of Statement of Position
93 - 2 (SOP 93 - 2) Determination, Disclosure and
Financial Statement Presentation of Income, Capital
Gain and Return of Capital Distributions by Investment
Companies, the Funds are required to report the
accumulated net investment income (loss) and
accumulated net capital gain (loss) accounts to
approximate amounts available for future distributions
on a tax basis (or to offset future realized capital
gains). Accordingly, at December 31, 1998
reclassifications were recorded to decrease
undistributed net investment income by $0 and
$29,413, decrease undistributed net realized gains by
$61,443,982 and $138,703 and increase capital stock
by $61,443,982 and $168,116 for The Yacktman Fund
and The Yacktman Focused Fund, respectively.
This reclassification has no impact on the net asset
value of the Fund and is designed to present the Funds
capital account on a tax basis.
