<PAGE> PAGE 1
000 B000000 10/31/96
000 C000000 0000892823
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0.a
000 J000000 A
001 A000000 PRINCOR UTILITIES FUND, INC.
001 B000000 811-07266
001 C000000 5152475476
002 A000000 THE PRINCIPAL FINANCIAL GROUP
002 B000000 DES MOINES
002 C000000 IA
002 D010000 50392
002 D020000 0200
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 N
007 B000000 0
020 A000001 MERRILL LYNCH
020 B000001 13-5674085
020 C000001 9
020 A000002 JEFFRIES & COMPANY
020 B000002 95-2622900
020 C000002 7
020 A000003 JONES & ASSOCIATES INC.
020 B000003 95-3583143
020 C000003 6
020 A000004 NATWEST SECURITIES CORP.
020 B000004 13-3312778
020 C000004 5
020 A000005 INVESTMENT TECHNOLOGY GROUP
020 B000005 95-4339369
020 C000005 5
020 A000006 CAPITAL INSTITUTIONAL SERVICES, INC.
020 B000006 75-1567505
020 C000006 4
020 A000007 EXECUTION SERVICES INCORPORATED
020 B000007 13-2862329
020 C000007 4
020 A000008 DEUTSCHE BANK CAPITAL, NY
020 B000008 13-6124068
020 C000008 4
020 A000009 DONALDSON, LUFKIN & JENRETTE (DLJ)
020 B000009 13-2741729
020 C000009 4
020 A000010 BEAR STEARNS & CO.
<PAGE> PAGE 2
020 B000010 13-3299429
020 C000010 3
021 000000 70
022 A000001 ASSOCIATES CORPORATION OF NORTH AMERICA
022 B000001 74-1494554
022 C000001 188969
022 D000001 0
022 A000002 GENERAL ELECTRIC CAPITAL CORP.
022 B000002 13-1500700
022 C000002 98959
022 D000002 0
022 A000003 GENERAL ELECTRIC CO.
022 B000003 42-1192999
022 C000003 11722
022 D000003 0
022 A000004 HOUSEHOLD FINANCE CORP.
022 B000004 36-1239445
022 C000004 9622
022 D000004 0
022 A000005 AMERICAN EXPRESS CREDIT CORPORATION
022 B000005 11-1988350
022 C000005 8116
022 D000005 0
022 A000006 PRUDENTIAL FUNDING CORP.
022 B000006 22-2231168
022 C000006 5507
022 D000006 0
022 A000007 FORD MOTOR CREDIT CO.
022 B000007 38-1612444
022 C000007 5221
022 D000007 0
022 A000008 AMERICAN GENERAL FINANCE CORP.
022 B000008 35-0416090
022 C000008 2254
022 D000008 0
022 A000009 BENEFICIAL CORP.
022 B000009 51-0003820
022 C000009 1868
022 D000009 0
022 A000010 AMERICAN GENERAL CORP.
022 B000010 42-1292293
022 C000010 1670
022 D000010 0
023 C000000 334587
023 D000000 159
025 D000001 0
025 D000002 0
025 D000003 0
025 D000004 0
025 D000005 0
025 D000006 0
<PAGE> PAGE 3
025 D000007 0
025 D000008 0
027 000000 Y
028 A010000 1208
028 A020000 0
028 A030000 0
028 A040000 1799
028 B010000 1301
028 B020000 0
028 B030000 0
028 B040000 1221
028 C010000 1053
028 C020000 573
028 C030000 0
028 C040000 942
028 D010000 823
028 D020000 0
028 D030000 0
028 D040000 950
028 E010000 887
028 E020000 0
028 E030000 0
028 E040000 1067
028 F010000 1069
028 F020000 523
028 F030000 0
028 F040000 1902
028 G010000 6341
028 G020000 1096
028 G030000 0
028 G040000 7881
028 H000000 3269
029 000000 Y
030 A000000 342
030 B000000 4.75
030 C000000 0.00
031 A000000 129
031 B000000 0
032 000000 38
033 000000 175
034 000000 Y
035 000000 29
036 A000000 N
036 B000000 0
042 A000000 0
042 B000000 0
042 C000000 100
042 D000000 0
042 E000000 0
042 F000000 0
042 G000000 0
<PAGE> PAGE 4
042 H000000 0
043 000000 214
044 000000 0
055 A000000 N
055 B000000 N
062 A000000 N
062 B000000 0.0
062 C000000 0.0
062 D000000 0.0
062 E000000 0.0
062 F000000 0.0
062 G000000 0.0
062 H000000 0.0
062 I000000 0.0
062 J000000 0.0
062 K000000 0.0
062 L000000 0.0
062 M000000 0.0
062 N000000 0.0
062 O000000 0.0
062 P000000 0.0
062 Q000000 0.0
062 R000000 0.0
063 A000000 0
063 B000000 0.0
066 A000000 Y
066 E000000 Y
067 000000 N
068 A000000 N
068 B000000 N
069 000000 N
071 A000000 25475
071 B000000 24280
071 C000000 70927
071 D000000 34
072 A000000 12
072 B000000 85
072 C000000 3568
072 D000000 0
072 E000000 0
072 F000000 437
072 G000000 0
072 H000000 0
072 I000000 228
072 J000000 5
072 K000000 0
072 L000000 0
072 M000000 9
072 N000000 45
072 O000000 0
072 P000000 0
<PAGE> PAGE 5
072 Q000000 0
072 R000000 7
072 S000000 0
072 T000000 214
072 U000000 0
072 V000000 0
072 W000000 7
072 X000000 952
072 Y000000 62
072 Z000000 2763
072AA000000 1903
072BB000000 0
072CC010000 908
072CC020000 0
072DD010000 2524
072DD020000 161
072EE000000 0
073 A010000 0.0000
073 A020000 0.0000
073 B000000 0.0000
073 C000000 0.0000
074 A000000 4
074 B000000 0
074 C000000 860
074 D000000 0
074 E000000 0
074 F000000 71049
074 G000000 0
074 H000000 0
074 I000000 0
074 J000000 0
074 K000000 0
074 L000000 429
074 M000000 0
074 N000000 72342
074 O000000 0
074 P000000 0
074 Q000000 0
074 R010000 0
074 R020000 0
074 R030000 0
074 R040000 130
074 S000000 0
074 T000000 72212
074 U010000 5819
074 U020000 518
074 V010000 0.00
074 V020000 0.00
074 W000000 0.0000
074 X000000 10075
074 Y000000 0
<PAGE> PAGE 6
075 A000000 0
075 B000000 72765
076 000000 0.00
077 A000000 Y
077 B000000 Y
080 A000000 ICI MUTUAL INSURANCE COMPANY
080 C000000 14000
081 A000000 Y
081 B000000 26
082 A000000 N
082 B000000 0
083 A000000 N
083 B000000 0
084 A000000 N
084 B000000 0
085 A000000 Y
085 B000000 N
SIGNATURE A. S. FILEAN
TITLE VICE PRESIDENT
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<INVESTMENTS-AT-COST> 67,160,726
<INVESTMENTS-AT-VALUE> 71,908,657
<RECEIVABLES> 429,217
<ASSETS-OTHER> 432
<OTHER-ITEMS-ASSETS> 3,880
<TOTAL-ASSETS> 72,342,186
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 129,628
<TOTAL-LIABILITIES> 129,628
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 68,478,083
<SHARES-COMMON-STOCK> 5,819,330
<SHARES-COMMON-PRIOR> 6,020,742
<ACCUMULATED-NII-CURRENT> 325,361
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,338,817)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 4,747,931
<NET-ASSETS> 72,212,558
<DIVIDEND-INCOME> 3,568,650
<INTEREST-INCOME> 84,808
<OTHER-INCOME> 0
<EXPENSES-NET> (890,096)
<NET-INVESTMENT-INCOME> 2,763,362
<REALIZED-GAINS-CURRENT> 1,903,036
<APPREC-INCREASE-CURRENT> 907,722
<NET-CHANGE-FROM-OPS> 5,574,120
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,523,991)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 985,437
<NUMBER-OF-SHARES-REDEEMED> (1,377,265)
<SHARES-REINVESTED> 190,416
<NET-CHANGE-IN-ASSETS> 2,387,188
<ACCUMULATED-NII-PRIOR> 246,709
<ACCUMULATED-GAINS-PRIOR> (3,241,853)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 437,402
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 951,718
<AVERAGE-NET-ASSETS> 72,895,568
<PER-SHARE-NAV-BEGIN> 10.94
<PER-SHARE-NII> .44
<PER-SHARE-GAIN-APPREC> .45
<PER-SHARE-DIVIDEND> (.43)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.40
<EXPENSE-RATIO> 1.17
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0<F1>
<FN>
<F1>Without the Manager's voluntary waiver of a portion of certain expenses for
this period, this fund would have had per share net investment income of $.43
and a ratio of expenses to average net assets of 1.25%. The amount waived was
$54,932.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<INVESTMENTS-AT-COST> 67,160,726
<INVESTMENTS-AT-VALUE> 71,908,657
<RECEIVABLES> 429,217
<ASSETS-OTHER> 432
<OTHER-ITEMS-ASSETS> 3,880
<TOTAL-ASSETS> 72,342,186
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 129,628
<TOTAL-LIABILITIES> 129,628
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 68,478,083
<SHARES-COMMON-STOCK> 490,293
<SHARES-COMMON-PRIOR> 361,704
<ACCUMULATED-NII-CURRENT> 325,361
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,338,817)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 4,747,931
<NET-ASSETS> 72,212,558
<DIVIDEND-INCOME> 3,568,650
<INTEREST-INCOME> 84,808
<OTHER-INCOME> 0
<EXPENSES-NET> (890,096)
<NET-INVESTMENT-INCOME> 2,763,362
<REALIZED-GAINS-CURRENT> 1,903,036
<APPREC-INCREASE-CURRENT> 907,722
<NET-CHANGE-FROM-OPS> 5,574,120
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (158,855)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 292,572
<NUMBER-OF-SHARES-REDEEMED> (176,703)
<SHARES-REINVESTED> 12,720
<NET-CHANGE-IN-ASSETS> 2,387,188
<ACCUMULATED-NII-PRIOR> 246,709
<ACCUMULATED-GAINS-PRIOR> (3,241,853)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 437,402
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 951,718
<AVERAGE-NET-ASSETS> 72,895,568
<PER-SHARE-NAV-BEGIN> 10.93
<PER-SHARE-NII> .36
<PER-SHARE-GAIN-APPREC> .43
<PER-SHARE-DIVIDEND> (.34)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.38
<EXPENSE-RATIO> 1.93
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0<F1>
<FN>
<F1>Without the Manager's voluntary waiver of a portion of certain expenses for
this period, this fund would have had per share net investment income of $.34
and a ratio of expenses to average net assets of 2.06%. The amount waived was
$6,690.
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> OCT-31-1996
<INVESTMENTS-AT-COST> 67,160,726
<INVESTMENTS-AT-VALUE> 71,908,657
<RECEIVABLES> 429,217
<ASSETS-OTHER> 432
<OTHER-ITEMS-ASSETS> 3,880
<TOTAL-ASSETS> 72,342,186
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 129,628
<TOTAL-LIABILITIES> 129,628
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 68,478,083
<SHARES-COMMON-STOCK> 27,440
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 325,361
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,338,817)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 4,747,931
<NET-ASSETS> 72,212,558
<DIVIDEND-INCOME> 3,568,650
<INTEREST-INCOME> 84,808
<OTHER-INCOME> 0
<EXPENSES-NET> (890,096)
<NET-INVESTMENT-INCOME> 2,763,362
<REALIZED-GAINS-CURRENT> 1,903,036
<APPREC-INCREASE-CURRENT> 907,722
<NET-CHANGE-FROM-OPS> 5,574,120
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,864)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 27,529
<NUMBER-OF-SHARES-REDEEMED> (256)
<SHARES-REINVESTED> 167
<NET-CHANGE-IN-ASSETS> 2,387,188
<ACCUMULATED-NII-PRIOR> 246,709
<ACCUMULATED-GAINS-PRIOR> (3,241,853)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 437,402
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 951,718
<AVERAGE-NET-ASSETS> 72,895,568
<PER-SHARE-NAV-BEGIN> 11.75
<PER-SHARE-NII> .28
<PER-SHARE-GAIN-APPREC> (.41)
<PER-SHARE-DIVIDEND> (.29)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.33
<EXPENSE-RATIO> 1.47
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0<F1>
<FN>
<F1>Without the Manager's voluntary waiver of a portion of certain expenses for
this period, this fund would have had per share net investment income of $.17
and a ratio of expenses to average net assets of 1.47%. The amount waived was
$0.
</FN>
</TABLE>
Report of Independent Auditors on Internal Control Structure
Board of Directors and Shareholders
Princor Utilities Fund, Inc.
In planning and performing our audit of the financial statements of Princor
Utilities Fund, Inc. for the year ended October 31, 1996, we considered its
internal control structure, including procedures for safeguarding securities, in
order to determine our auditing procedures for the purpose of expressing our
opinion on the financial statements and to comply with the requirements of Form
N-SAR, not to provide assurance on the internal control structure.
The management of Princor Utilities Fund, Inc. is responsible for establishing
and maintaining an internal control structure. In fulfilling this
responsibility, estimates and judgments by management are required to assess the
expected benefits and related costs of internal control structure policies and
procedures. Two of the objectives of an internal control structure are to
provide management with reasonable, but not absolute, assurance that assets are
safeguarded against loss from unauthorized use or disposition and that
transactions are executed in accordance with management's authorization and
recorded properly to permit preparation of financial statements in conformity
with generally accepted accounting principles.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projection of any evaluation
of the structure to future periods is subject to the risk that it may become
inadequate because of changes in conditions or that the effectiveness of the
design and operation may deteriorate.
Our consideration of the internal control structure would not necessarily
disclose all matters in the internal control structure that might be material
weaknesses under standards established by the American Institute of Certified
Public Accountants. A material weakness is a condition in which the design or
operation of the specific internal control structure elements does not reduce to
a relatively low level the risk that errors or irregularities in amounts that
would be material in relation to the financial statements being audited may
occur and not be detected within a timely period by employees in the normal
course of performing their assigned functions. However, we noted no matters
involving the internal control structure, including procedures for safeguarding
securities, that we consider to be material weaknesses as defined above as of
October 31, 1996.
This report is intended solely for the information and use of management and the
Securities and Exchange Commission.
ERNST & YOUNG
Des Moines, Iowa
November 27, 1996
