CARDINAL GROUP, 497, 1996-01-26

CARDINAL GROUP
497, 1996-01-26

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<PAGE> 1

PROSPECTUS Rule 497(c) File No. 811-7588

THE CARDINAL FUND

The Cardinal Fund (the "Fund") is a diversified investment fund of The
Cardinal Group (the "Group"), an open-end, management investment company. The
Trustees of the Group have divided the Fund's beneficial ownership into an
unlimited number of transferable units called shares (the "Shares").

The Fund's investment objectives are long-term growth of capital and
income. Current income is a secondary objective. The Fund seeks to achieve its
objectives through selective participation in the long-term progress of
businesses and industries. The policy of the Fund is generally to invest in
equity securities. There can be no assurance that the Fund's objectives will be
achieved.

THE SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY ANY BANK, NOR ARE SUCH SHARES FEDERALLY INSURED BY THE U.S.
GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD
OR ANY OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN THE FUND INVOLVES CERTAIN
INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
- --------------------------------------------------------------------------------

For further information regarding the Fund or for assistance in opening an
account or redeeming Shares, please call (800) 282-9446 toll free.

Inquiries may also be made by mail addressed to the Fund at its principal
office:

155 East Broad Street
Columbus, Ohio 43215
- --------------------------------------------------------------------------------

The Prospectus relates only to The Cardinal Fund, currently one of six
funds of the Group. Interested persons who wish to obtain prospectuses of
Cardinal Government Obligations Fund, Cardinal Government Securities Money
Market Fund, Cardinal Tax Exempt Money Market Fund, Cardinal Balanced Fund or
Cardinal Aggressive Growth Fund should contact The Ohio Company. Additional
information about the Fund, contained in a Statement Of Additional Information
dated as of January 10, 1996, has been filed with the Securities and Exchange
Commission and is incorporated herein by reference. Such Statement is available
upon request without charge from the Fund at the above address or by calling the
phone number provided above.

This Prospectus sets forth concisely the information about the Fund that a
prospective investor ought to know before investing in the Fund. This Prospectus
should be retained for future reference.

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

The Ohio Company

The date of this Prospectus is January 10, 1996.

<PAGE> 2

PROSPECTUS HIGHLIGHTS

INVESTMENT OBJECTIVES......... The Fund seeks long-term growth of capital and
income. Current income is a secondary
objective. (See page 4.)

INVESTMENT POLICIES........... The Fund generally invests in equity securities
which are growth oriented. Current income,
while a factor in portfolio selection, is
secondary to the primary objective. (See pages
4 and 5.)

DIVIDENDS..................... Dividends and capital gains distributions are
made with such frequency as the Group shall
determine. Generally, dividends are declared
quarterly and long-term capital gains, if any,
are declared annually. Such dividends and
distributions may be invested in additional
Shares of the Fund at no charge. (See page 11.)

PURCHASES..................... There is a minimum initial investment of $1,000
with subsequent minimums of $50. (See page 8.)
Purchases are made at the public offering price
which is equal to net asset value per share
plus a sales charge. This charge is equal to
4.50% of the public offering price (4.71% of
net amount invested) reduced on investments of
$100,000 or more (see page 8) and waived for
certain purchasers for whom The Ohio Company
serves as a trustee or investment adviser. (See
page 9.)

REDEMPTIONS................... Shares can be redeemed at net asset value per
share without charge, if redeemed through the
Fund's distributor, The Ohio Company. (See page
11.)

INVESTMENT ADVISER AND
MANAGER..................... Cardinal Management Corp. (the "Adviser"), a
wholly-owned subsidiary of The Ohio Company, is
the Fund's investment adviser. The Adviser also
serves as investment adviser for Cardinal
Government Obligations Fund, Cardinal
Government Securities Money Market Fund,
Cardinal Tax Exempt Money Market Fund, Cardinal
Balanced Fund and Cardinal Aggressive Growth
Fund (collectively, with the Fund, the
"Cardinal Funds"). (See page 16.)

RISK FACTORS AND
SPECIAL CONSIDERATIONS...... An investment in a mutual fund such as the Fund
involves a certain amount of risk and may not
be suitable for all investors. Some investment
policies of the Fund may entail certain risks.
(See "WHAT ARE THE INVESTMENT OBJECTIVES AND
POLICIES OF THE FUND? -- Risk Factors and
Investment Techniques" on pages 5 through 7.)

2
<PAGE> 3

FEE TABLE

SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of offering price)......... 4.50%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees..................................................................... .60%
12b-1 Fees After Fee Waiver(1)...................................................... 0
Other Expenses(2)................................................................... .21
----
Total Fund Operating Expenses After Fee Waiver.............................. .81%
====
</TABLE>

EXAMPLE

<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<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: $ 53 $70

<FN>
- ---------------

(1) The Ohio Company, as the Fund's distributor, has agreed with the Group to
waive all of its Rule 12b-1 fees until September 30, 1996. Absent such
waiver, Rule 12b-1 Fees and Total Fund Operating Expenses would be 0.25% and
1.06%, respectively.

(2) "Other Expenses" are based upon estimated amounts for the current fiscal
year.
</TABLE>

The purpose of the above table is to assist a potential purchaser of the
Fund's Shares in understanding the various costs and expenses that an investor
in the Fund will bear directly or indirectly. See "WHO MANAGES MY INVESTMENT IN
THE FUND?" for a more complete discussion of the shareholder transaction
expenses and annual operating expenses of the Fund. THE FOREGOING EXAMPLE SHOULD
NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES. ACTUAL EXPENSES
MAY BE GREATER OR LESS THAN THOSE SHOWN.

3
<PAGE> 4

PERFORMANCE INFORMATION

From time to time the Fund may advertise its average annual total return
and cumulative return. SUCH RETURN FIGURES ARE BASED UPON HISTORICAL EARNINGS
AND ARE NOT INTENDED TO INDICATE FUTURE PERFORMANCE. The average annual total
return advertised by the Fund refers to the return generated by an investment in
the Fund over certain specified periods since the establishment of the Fund. The
average annual total return over a period equates the amount of an initial
investment in the Fund to the amount redeemable at the end of that period
assuming that any dividends and distributions earned by an investment in the
Fund are immediately reinvested and the maximum applicable sales charge
(currently 4.5%) is deducted from the initial investment at the time of
investment. Such figure is then annualized. The cumulative return advertised
refers to the total return on a hypothetical investment over the relevant period
and equates the amount of an initial investment in the Fund to the amount
redeemable at the end of that period assuming that any dividends and
distributions are immediately reinvested and the maximum sales charge is
deducted from the initial investment. If the sales charge were not deducted, the
average annual total return and cumulative return advertised would be higher.

Investors may also judge the performance of the Fund by comparing or
referencing its performance to the performance of other mutual funds or mutual
fund portfolios with comparable investment objectives and policies through
various mutual fund or market indices such as those prepared by Dow Jones & Co.,
Inc., and Standard & Poor's Corporation, and to data prepared by Lipper
Analytical Services, Inc., Morningstar, Inc. and CDA Investment Technologies,
Inc. Comparisons may also be made to indices or data published in Money
Magazine, Forbes, Barron's, The Wall Street Journal, The New York Times, The
Columbus Dispatch, Business Week, U.S.A. Today and Consumer Reports. In addition
to performance information, general information about the Fund that appears in a
publication such as those mentioned above may be included in advertisements and
in reports to shareholders.

WHAT IS THE FUND?

The Fund is one separate diversified investment fund of the Group, which
was organized on March 23, 1993, as an Ohio business trust. The Group is
registered and operates as an open-end management investment company as defined
in the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund has
been organized for the purpose of acquiring all of the assets and liabilities of
The Cardinal Fund Inc. ("TCFI") to effect a reorganization of TCFI from a stand
alone investment company to a separate series of the Group (the
"Reorganization").

WHAT ARE THE INVESTMENT OBJECTIVES
AND POLICIES OF THE FUND?

IN GENERAL

The investment objectives of the Fund are to achieve long-term growth of
capital and income. Current income is a secondary objective. The Fund seeks to
achieve its objectives through selective participation in the long-term progress
of businesses and industries. The investment objectives with respect to the Fund
are a fundamental policy and as such may not be changed without a vote of the
holders of a majority of the outstanding Shares of the Fund (as defined below
under "WHAT ARE MY RIGHTS AS A SHAREHOLDER?"). The Fund is not intended to
provide a complete and balanced investment program for an investor. There can be
no assurance that the investment objectives of the Fund will be achieved.

The policy of the Fund is generally to invest in equity securities of
companies which, in the opinion of the Adviser, are growth oriented. The
securities purchased by the Fund are traded in either established
over-the-counter markets or on national exchanges and are issued by companies

4
<PAGE> 5

having a market capitalization of at least $10 million. This policy of normally
investing in equity securities believed to have a potential for long-term
capital appreciation means that the assets of the Fund will generally be subject
to greater risk than may be involved in securities which do not have such growth
characteristics. It is recognized, however, that there may be times when, as a
temporary, defensive measure, the Fund's equity position should be reduced. At
such times, and otherwise for cash management purposes, the Fund may hold its
assets in cash or invest its assets in investment grade debt securities, U.S.
Government securities, securities of other investment companies, repurchase
agreements and preferred stock.

RISK FACTORS AND INVESTMENT TECHNIQUES

GENERAL. Like any investment program, an investment in the Fund entails
certain risks. As a fund investing primarily in common stocks, the Fund is
subject to stock market risk, i.e., the possibility that stock prices in general
will decline over short or even extended periods.

The Fund may invest in put and call options and futures, as described
below. Such instruments are considered to be derivatives. A derivative is
generally defined as an instrument whose value is based upon, or derived from,
some underlying index, reference rate (e.g., interest rates), security,
commodity or other asset. The Fund will not invest more than 10% of its total
assets in such derivatives at any one time.

REPURCHASE AGREEMENTS. Securities held by the Fund may be subject to
repurchase agreements. Under the terms of the repurchase agreement, the Fund
would acquire securities from a financial institution such as a well-established
securities dealer or a bank which is a member of the Federal Reserve System
which the Adviser deems creditworthy under guidelines approved by the Group's
Board of Trustees. At the time of purchase, the bank or securities dealer agrees
to repurchase the underlying securities from the Fund at a specified time and
price. The resale price reflects the purchase price plus an agreed upon market
rate of interest which is unrelated to the coupon rate or maturity of the
underlying security. The Fund will only enter into a repurchase agreement where
(i) the underlying securities are of the type which the Fund's investment
policies would allow it to purchase directly, (ii) the market value of the
underlying security, including interest accrued, will be at all times equal to
or exceed the value of the repurchase agreement, and (iii) payment for the
underlying securities is made only upon physical delivery or evidence of book-
entry transfer to the account of the Fund's custodian or a bank acting as agent.
The Adviser will be responsible for continuously monitoring such requirements.

FOREIGN SECURITIES. The Fund may also invest up to 25% of its net assets
in foreign securities through the purchase of sponsored and unsponsored American
Depositary Receipts ("ADRs"). Unsponsored ADRs may be less liquid than sponsored
ADRs, and there may be less information available regarding the underlying
foreign issuer for unsponsored ADRs. Investment in foreign securities is subject
to special investment risks that differ in some respects from those related to
investments in securities of U.S. domestic issuers. Such risks include trade
balances and imbalances, and related economic policies, future adverse
political, economic and social developments, the possible imposition of
withholding taxes on interest income, possible seizure, nationalization, or
expropriation of foreign investments or deposits, less stringent disclosure
requirements, the possible establishment of exchange controls or taxation at the
source, or the adoption of other foreign governmental restrictions. In addition,
foreign issuers may be subject to different accounting, auditing, reporting, and
recordkeeping standards than those applicable to U.S. domestic issuers, and
securities markets in foreign countries may be structured differently from and
may not be as liquid as the U.S. markets. The Fund will acquire securities
issued by foreign issuers only when the Adviser believes that the risks
associated with such investments are minimal.

5
<PAGE> 6

a complete loss of the amounts paid as premiums to writers of options. The Fund
will purchase put options only on securities in which the Fund may otherwise
invest. The Fund may also engage in writing call options from time to time as
the Adviser deems appropriate. The Fund will write only covered call options
(options on securities owned by the Fund). In order to close out a call option
it has written, the Fund will enter into a "closing purchase transaction" -- the
purchase of a call option on the same security with the same exercise price and
expiration date as the call option which the Fund previously has written. When a
portfolio security subject to a call option is sold, the Fund will effect a
closing purchase transaction to close out any existing call option on that
security. If the Fund is unable to effect a closing purchase transaction, it
will not be able to sell the underlying security until the option expires or the
Fund delivers the underlying security upon exercise. Under normal market
conditions, it is not expected that the underlying value of portfolio securities
subject to such options would exceed 25% of the net assets of the Fund.

The Fund, as part of its option transactions, also may purchase index put
and call options and write index options. As with options on individual
securities, the Fund will write only covered index call options. Through the
writing or purchase of index options the Fund can achieve many of the same
objectives as through the use of options on individual securities. Options on
securities indices are similar to options on a security except that, rather than
the right to take or make delivery of a security at a specified price, an option
on a securities index gives the holder the right to receive, upon exercise of
the option, an amount of cash if the closing level of the securities index upon
which the option is based is greater than, in the case of a call, or less than,
in the case of a put, the exercise price of the option.

Price movements in securities which the Fund owns or intends to purchase
probably will not correlate perfectly with movements in the level of an index
and, therefore, the Fund bears the risk of a loss on an index option that is not
completely offset by movements in the price of such securities. Because index
options are settled in cash, a call writer cannot determine the amount of its
settlement obligations in advance and, unlike call writing on specific
securities, cannot provide in advance for, or cover, its potential settlement
obligations by acquiring and holding the underlying securities. The Fund may be
required to segregate assets or provide an initial margin to cover index options
that would require it to pay cash upon exercise.

FUTURES CONTRACTS. The Fund may also enter into contracts for the future
delivery of securities and futures contracts based on a specific security, class
of securities or an index, purchase or sell options on any such futures
contracts and engage in related closing transactions. A futures contract on a
securities index is an agreement obligating either party to pay, and entitling
the other party to receive, while the contract is outstanding, cash payments
based on the level of a specified securities index.

The Fund may engage in such futures contracts in an effort to hedge against
market risks. For example, when interest rates are expected to rise or market
values of portfolio securities are expected to fall, the Fund can seek through
the sale of futures contracts to offset a decline in the value of its portfolio
securities. When interest rates are expected to fall or market values are
expected to rise, the Fund, through the purchase of such contracts, can attempt
to secure better rates or prices for the Fund than might later be available in
the market when it effects anticipated purchases.

The acquisition of put and call options on futures contracts will,
respectively, give the Fund the right (but not the obligation), for a specified
price, to sell or to purchase the underlying futures contract, upon exercise of
the option, at any time during the option period.

Aggregate initial margin deposits for futures contracts, and premiums paid
for related options, may not exceed five percent of the Fund's total assets, and
the value of securities that are the subject of such futures and options (both
for receipt and delivery) may not exceed one-third of the market value of the
Fund's total assets. Futures transactions will be limited to the extent
necessary to maintain the Fund's qualification as a regulated investment
company.

6
<PAGE> 7

Futures transactions involve brokerage costs and require the Fund to
segregate assets to cover contracts that would require it to purchase
securities. The Fund may lose the expected benefit of futures transactions if
interest rates or securities prices move in an unanticipated manner. Such
unanticipated changes may also result in poorer overall performance than if the
Fund had not entered into any futures transactions. In addition, the value of
the Fund's futures positions may not prove to be perfectly or even highly
correlated with the value of its portfolio securities, limiting the Fund's
ability to hedge effectively against interest rate and/or market risk and giving
rise to additional risks. There is no assurance of liquidity in the secondary
market for purposes of closing out futures positions.

INVESTMENT COMPANY SECURITIES. The Fund may also invest up to 10% of the
value of its total assets in the securities of other investment companies
subject to the limitations set forth in the 1940 Act. The Fund intends to invest
in the securities of other investment companies which, in the opinion of the
Adviser, will assist the Fund in achieving its investment objectives and in
money market mutual funds for purposes of short-term cash management. The Fund's
investment in such other investment companies may result in the duplication of
fees and expenses, particularly investment advisory fees. For a further
discussion of the limitations on the Fund's investments in other investment
companies, see "INVESTMENT OBJECTIVES AND POLICIES -- Additional Information on
Portfolio Instruments -- Securities of Other Investment Companies" in the Fund's
Statement of Additional Information.

INVESTMENT RESTRICTIONS

The Fund is subject to a number of investment restrictions that may be
changed only by a vote of a majority of the outstanding Shares of the Fund (as
defined below under "WHAT ARE MY RIGHTS AS A SHAREHOLDER?").

The Fund will not:

1. Purchase securities of any one issuer, other than obligations
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, if, immediately after such purchase, more than 5% of the
value of the Fund's total assets would be invested in such issuer, or the
Fund would hold more than 10% of the outstanding voting securities of the
issuer, except that up to 25% of the value of the Fund's total assets may
be invested without regard to such limitations. There is no limit to the
percentage of assets that may be invested in U.S. Treasury bills, notes, or
other obligations issued or guaranteed by the U.S. Government or its
agencies or instrumentalities.

2. Purchase any securities which would cause more than 25% of the
value of the Fund's total assets at the time of purchase to be invested in
securities of one or more issuers conducting their principal business
activities in the same industry, provided that: (a) there is no limitation
with respect to obligations issued or guaranteed by the U.S. Government or
its agencies or instrumentalities and repurchase agreements secured by
obligations of the U.S. Government or its agencies or instrumentalities;
(b) wholly owned finance companies will be considered to be in the
industries of their parents if their activities are primarily related to
financing the activities of their parents; and (c) utilities will be
divided according to their services. For example, gas, gas transmission,
electric and gas, electric, and telephone will each be considered a
separate industry.

3. Borrow money or issue senior securities, except that the Fund may
borrow from banks or enter into reverse repurchase agreements or dollar
roll agreements for temporary purposes in amounts up to 10% of the value of
its total assets at the time of such borrowing and except as permitted
pursuant to an exemption from the 1940 Act. The Fund will not purchase
securities while its borrowings (including reverse repurchase agreements
and dollar roll agreements) exceed 5% of its total assets.

7
<PAGE> 8

4. Make loans, except that the Fund may purchase or hold debt
instruments and lend portfolio securities in accordance with its investment
objectives and policies, make time deposits with financial institutions and
enter into repurchase agreements.

The following additional investment restriction may be changed without the
vote of a majority of the outstanding Shares of the Fund.

The Fund may not:

1. Purchase or otherwise acquire any securities, if as a result, more
than 15% of the Fund's net assets would be invested in securities that are
illiquid.

HOW DO I PURCHASE SHARES OF THE FUND?

GENERAL

The Fund's Shares may be purchased at the public offering price, as
described below under "Public Offering Price," through The Ohio Company,
principal underwriter of the Fund's Shares, at its address and telephone number
set forth on the cover page of this Prospectus, and through other broker-dealers
who are members of the National Association of Securities Dealers, Inc. and have
sales agreements with The Ohio Company.

Subsequent purchases of Shares of the Fund may be made by ACH processing as
described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED? -- ACH
Processing" below. In addition, if an Account Information Form has previously
been received by The Ohio Company, Shares may also be purchased by wiring funds
to the Fund's custodian. Prior to wiring any such funds and to in order to
ensure that wire orders are invested properly, you must call The Ohio Company to
obtain the necessary instructions and information.

The minimum initial investment for individuals is $1,000, except the
initial investment for an applicant investing by means of the Automatic
Investment Plan, as described below, must be at least $50. Subsequent
investments must be in amounts of at least $50.

The Group reserves the right to reject any order for the purchase of Shares
in whole or in part. You will receive a confirmation of each new transaction in
your account, which will also show the total number of Shares owned by you and
the number of Shares being held in safekeeping by Cardinal Management Corp., as
the Fund's transfer agent (the "Transfer Agent"), for your account. Certificates
representing Shares will not be issued.

PUBLIC OFFERING PRICE

The public offering price of Shares of the Fund is the net asset value per
share (see "HOW IS NET ASSET VALUE CALCULATED?") next determined after receipt
by The Ohio Company, its agents or broker-dealers with whom it has an agreement,
of an order and payment, plus a sales charge as follows:

<TABLE>
<CAPTION>
SALES CHARGE AS A PERCENTAGE
AS A OF OFFERING PRICE
PERCENTAGE ---------------------
AMOUNT OF OF THE NET SALES DEALER'S
SINGLE TRANSACTION AMOUNT INVESTED CHARGE CONCESSION
- ------------------------------------------------------ --------------- ------ ----------
<S> <C> <C> <C>
Less than $100,000.................................... 4.71% 4.50% 4.00%
$100,000 but less than $250,000....................... 3.63 3.50 3.00
$250,000 but less than $500,000....................... 2.56 2.50 2.00
$500,000 but less than $1,000,000..................... 1.52 1.50 1.00
$1,000,000 or more.................................... 0.50 0.50 0.40
</TABLE>

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<PAGE> 9

(See "HOW IS NET ASSET VALUE CALCULATED?" for a description of the
computation of net asset value per share.)

The above charges on investments of $100,000 or more are applicable to
purchases made at one time by an individual, or an individual, his spouse and
their children not of legal age, or a trustee, guardian or other like fiduciary
of certain single trust estates or certain single fiduciary accounts.

No sales charge is imposed on purchases of Shares by (1) officers,
trustees, and employees of the Group, (2) full-time employees of The Ohio
Company or the Adviser who have been such for at least 90 days or by qualified
retirement plans for such persons, or (3) accounts with respect to which The
Ohio Company serves either as a trustee or as investment adviser.

From time to time, The Ohio Company, from its own resources, may also
provide additional compensation to securities dealers in connection with sales
of shares of the Cardinal Funds. Such compensation will include financial
assistance to securities dealers in connection with conferences, sales or
training programs for their employees, seminars for the public, advertising,
sales campaigns and/or shareholder services and programs regarding one or more
of the Cardinal Funds and other dealer-sponsored programs or events. In some
instances, this compensation may be made available only to certain securities
dealers whose representatives have sold or are expected to sell significant
amounts of shares of the Cardinal Funds. Compensation will include payment for
travel expenses, including lodging, incurred in connection with trips taken by
invited registered representatives and members of their families to locations
within or outside of the United States for meetings or seminars of a business
nature. Securities dealers may not use sales of the Fund's Shares to qualify for
this compensation to the extent such may be prohibited by the laws of any state
or any self-regulatory agency, such as the National Association of Securities
Dealers, Inc. In addition, The Ohio Company may make ongoing payments to
brokerage firms, financial institutions (including banks) and others to
facilitate the administration and servicing of shareholder accounts. None of the
aforementioned additional compensation is paid for by the Fund or its
shareholders.

AUTOMATIC INVESTMENT PLAN

The Fund has made arrangements to enable you to make automatic monthly or
quarterly investments, in the minimum amount of $50 per transaction, from your
checking account. Assuming the cooperation of your financial institution, your
checking account therein will be debited to purchase Shares of the Fund on the
periodic basis you select. Confirmation of your purchase of Fund Shares will be
provided by the Transfer Agent. The debit of your checking account will be
reflected in the checking account statement you receive from your financial
institution. Please contact The Ohio Company for the appropriate form.

MAY MY TAX SHELTERED RETIREMENT
PLAN INVEST IN THE FUND?

Shares of the Fund qualify for purchase in connection with the following
tax sheltered retirement plans:

-- Individual retirement account ("IRAs") plans

-- Simplified Employee Pension Plans

-- 403(b)(7) Custodial Plans sponsored by certain tax-exempt employers

-- Pension, profit-sharing and 401(k) plans qualifying under Section 401(a)
of the Internal Revenue Code

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<PAGE> 10

HOW MAY I QUALIFY FOR QUANTITY DISCOUNTS?

LETTER OF INTENTION

If you (including your spouse and children not of legal age) intend to
purchase $100,000 or more of Shares of the Fund and of any other Cardinal Fund
sold with a sales charge (a "Cardinal Load Fund") during any 13-month period you
may sign a letter of intention to that effect obtained from The Ohio Company and
pay the reduced sales charge applicable to the total amount of Shares to be so
purchased. The 13-month period during which the Letter of Intention is in effect
will begin on the date of the earliest purchase to be included. In addition,
trustees, guardians or other like fiduciaries of single trust estates or certain
single fiduciary accounts may take advantage of the quantity discounts pursuant
to a letter of intention.

A letter of intention is not a binding obligation upon you to purchase the
full amount indicated. Shares purchased with the first 5% of such amount will be
held in escrow (while remaining registered in your name) to secure payment of
the higher sales charge applicable to the Shares actually purchased. If the full
amount indicated is not purchased, such escrowed Shares will be involuntarily
redeemed to pay the additional sales charge, if necessary. Dividends on escrowed
Shares, whether paid in cash or reinvested in additional Shares of the
applicable Cardinal Load Fund, are not subject to escrow. The escrowed Shares
will not be available for disposal by you until all purchases pursuant to the
letter of intention have been made or the higher sales charge has been paid.
When the full amount indicated has been purchased, the escrow will be released.
To the extent that you purchase more than the dollar amount indicated on the
Letter of Intention and qualify for a further reduced sales charge, the sales
charge will be adjusted for the entire amount purchased at the end of the
13-month period. The difference in sales charge will be, as you instruct, either
delivered to you in cash or used to purchase additional Shares of the Cardinal
Load Fund designated by you subject to the rate of sales charge applicable to
the actual amount of the aggregate purchases. This program, however, may be
modified or eliminated at any time or from time to time by the Group without
notice.

CONCURRENT PURCHASES

For purposes of qualifying for a lower sales charge, you have the privilege
of combining "concurrent purchases" of Shares of the Fund and of one or more of
the other Cardinal Load Funds. For example, if you concurrently purchase Shares
of the Fund at the total public offering price of $50,000 and shares of another
Cardinal Load Fund at the total public offering price of $50,000, the sales
charge would be that applicable to a $100,000 purchase as shown in the table
above. "Concurrent purchases," as described above, shall include the combined
purchases of you, your spouse and your children not of legal age. To receive the
applicable public offering price pursuant to this privilege, you must, at the
time of purchase, give The Ohio Company sufficient information to permit
confirmation of qualification. This privilege, however, may be modified or
eliminated at any time or from time to time by the Group without notice thereof.

RIGHTS OF ACCUMULATION

After your initial purchase of Shares you may also be eligible to pay a
reduced sales charge for your subsequent purchases of Shares where the total
public offering price of Shares then being purchased plus the then aggregate
current net asset value of Shares of the Fund and of shares of any Cardinal Load
Fund held in your account equals $100,000 or more. You would be able to purchase
Shares at the public offering price applicable to the total of (a) the total
public offering price of the Shares of the Fund then being purchased plus (b)
the then current net asset value of Shares of the Fund and of shares of any
other Cardinal Load Fund held in your account. For purposes of determining the
aggregate current net asset value of Shares held in your account, you may
include Shares then owned by your spouse and children not of legal age.

10
<PAGE> 11

You may obtain additional information about the foregoing special purchase
method from The Ohio Company. You are responsible for notifying The Ohio Company
at the time of purchase when purchases may be accumulated to take advantage of
the reduced sales charge. This program, however, may be modified or eliminated
at any time or from time to time by the Group without notice thereof.

WHAT DISTRIBUTIONS WILL I RECEIVE?

Dividends and distributions shall be made with such frequency (long term
capital gains normally will be distributed only once annually) and in such
amounts as the Group from time to time shall determine and from net income and
net realized capital gains of the Fund. It is the policy of the Fund to
distribute, at least annually, substantially all of its net investment income
and to distribute annually any net realized capital gains. Unless a shareholder
specifically requests otherwise in writing to the Transfer Agent, dividends and
distributions will be made only in additional full and fractional Shares of the
Fund and not in cash. Dividends are paid in cash not later than seven days after
a shareholder's complete redemption of his Shares in the Fund.

Shareholders may also elect to receive dividends and distributions in cash
by using ACH processing as described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED? -- ACH Processing" below.

HOW MAY I REDEEM MY SHARES?

Investors may redeem Shares of the Fund on any Business Day at the net
asset value per share next determined following receipt by the Transfer Agent,
215 East Capital Street, Columbus, Ohio 43215, of written or telephonic notice
to redeem, as described more fully below. See "HOW IS NET ASSET VALUE
CALCULATED?", below, for a description of when net asset value is determined.

As requested, The Ohio Company, on behalf of a shareholder, will forward
the foregoing notice to redeem to the Transfer Agent without charge. Other
broker-dealers may assist a shareholder in redeeming his Shares and may charge a
fee for such services.

The Group will make payment for redeemed Shares as promptly as practicable
but in no event more than seven days after receipt by the Transfer Agent of the
foregoing notice. The Group reserves the right to delay payment for the
redemption of Shares where such Shares were purchased with other than
immediately available funds, but only until the purchase payment has cleared
(which may take fifteen or more days from the date the purchase payment is
received by the Fund). The purchase of Fund Shares by wire transfer of federal
funds would avoid any such delay.

The Group intends to pay cash for all Shares redeemed, but, under abnormal
conditions which make payment in cash unwise, the Group may make payment wholly
or partly in portfolio securities at their then market value equal to the
redemption price. In such cases, an investor may incur brokerage costs in
converting such securities to cash.

The Group may suspend the right of redemption or may delay payment during
any period the determination of net asset value is suspended. See "HOW IS NET
ASSET VALUE CALCULATED?".

Due to the high cost of maintaining accounts, the Group reserves the right
to redeem, at net asset value, involuntarily Shares in any account at the then
current net asset value if at any time redemptions (but not as a result of a
decrease in the market price of such Shares or the deduction of any sales
charge) have reduced a shareholder's total investment in the Fund to a net asset
value below $500. A shareholder will be notified in writing that the value of
Fund Shares in the account is less than $500 and allowed not less than 30 days
to increase his investment in the Fund to $500 before the redemption is
processed. Proceeds of redemptions so processed, including dividends declared to
the date of redemption, will be promptly paid to the shareholder.

11
<PAGE> 12

REDEMPTION BY MAIL

Shareholders may redeem Shares of the Fund by submitting a written request
therefor to the Transfer Agent, at 215 East Capital Street, Columbus, Ohio
43215. The Transfer Agent will request a signature guarantee by an eligible
guarantor institution as described below. However, a signature guarantee will
not be required if (1) the redemption check is payable to the shareholder(s) of
record, and (2) the redemption check is mailed to the shareholder(s) at the
address of record, provided, however, that the address of record has not been
changed within the preceding 15 days. For purposes of this policy, an "eligible
guarantor institution" shall include banks, brokers, dealers, credit unions,
securities exchanges and associations, clearing agencies and savings
associations as those terms are defined in the Securities Exchange Act of 1934.
The Transfer Agent reserves the right to reject any signature guarantee if (1)
it has reason to believe that the signature is not genuine or (2) it has reason
to believe that the transaction would otherwise be improper.

REDEMPTION BY TELEPHONE

Shareholders may redeem Shares of the Fund by calling the Group at the
telephone number set forth on the front of this Prospectus. The Shareholder may
direct that the redemption proceeds be mailed to the address of record.

Neither the Group, the Fund nor its service providers will be liable for
any loss, damages, expense or cost arising out of any telephone redemption
effected in accordance with the Group's telephone redemption procedures, acting
upon instructions reasonably believed to be genuine. The Group will employ
procedures designed to provide reasonable assurances that instructions by
telephone are genuine; if these procedures are not followed, the Group, the Fund
or its service providers may be liable for any losses due to unauthorized or
fraudulent instructions. These procedures may include recording all phone
conversations, sending confirmations to shareholders within 72 hours of the
telephone transaction, and verification of account name and account number or
tax identification number. If, due to temporary adverse conditions, investors
are unable to effect telephone transactions, shareholders may also redeem their
Shares by mail as described above.

AUTOMATIC WITHDRAWAL

Shareholders may elect to have the proceeds from redemptions of Shares
transmitted to an authorized bank account at a Federal Reserve member bank
through ACH processing as described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED? -- ACH Processing" below.

SYSTEMATIC WITHDRAWAL PLAN

If you are the owner of Shares of the Fund having a total value of $10,000
or more at the current net asset value, you may elect to redeem your Shares
monthly or quarterly in amounts of $50 or more, pursuant to the Fund's
Systematic Withdrawal Plan. Please contact The Ohio Company for the appropriate
form.

WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED?

ACH PROCESSING

The Fund offers ACH privileges. Investors may use ACH processing to make
subsequent purchases, redeem Shares and/or electronically transfer distributions
paid on Fund Shares, in addition to the other methods described in this
Prospectus. ACH provides a method by which funds may be automatically
transferred to or from an authorized bank account at a Federal Reserve member
bank that is an ACH member. Please contact your representative if you are
interested in ACH processing.

12
<PAGE> 13

EXCHANGE PRIVILEGE

Shareholders of the Fund may, provided the amount to be exchanged meets the
applicable minimum investment requirements and the exchange is made in states
where it is legally authorized, exchange Shares of the Fund for shares of:

Cardinal Aggressive Growth Fund,
an equity fund seeking appreciation of
capital (upon the payment of the applicable sales charge);

Cardinal Balanced Fund,
a fund seeking current income and
long-term growth of both capital and
income (upon the payment of the applicable sales charge);

Cardinal Government Obligations Fund,
a fund investing in securities issued
or guaranteed by the U.S. Government
(upon the payment of the applicable sales charge);

Cardinal Government Securities Money Market Fund,
a U.S. Government securities money market fund
(without payment of any sales charge); or

Cardinal Tax Exempt Money Market Fund,
a tax-free money market fund
(without payment of any sales charge).

Notwithstanding the foregoing and subject to the limitations contained in
the following paragraph, (i) exchanges by holders of Fund Shares, for whom the
sales charge has been waived, for shares of a Cardinal Load Fund may be
completed without the payment of a sales charge, and (ii) exchanges of Fund
Shares by all other shareholders for shares of a Cardinal Load Fund may be
completed upon the payment of a sales charge equal to the difference, if any,
between the sales charge payable upon purchase of shares of such Cardinal Load
Fund and the sales charge previously paid on the Fund Shares to be exchanged.

The foregoing exchange privilege must be made by written or telephonic
authorization. A shareholder should notify The Ohio Company of his desire to
make an exchange, and The Ohio Company will furnish, as necessary, a prospectus
and an application form to open the account. The Transfer Agent will require
that any written authorization of an exchange include a signature guarantee as
described above under "HOW MAY I REDEEM MY SHARES? -- Redemption by mail."
However, a signature guarantee will not be required if the exchange is requested
to be made within the same account or into an existing account of the
shareholder held in the same name or names and in the same capacity as the
account from which the exchange is to be made. Shareholders may also authorize
an exchange of Shares of the Fund by telephone. Neither the Group, the Fund nor
any of its service providers will be liable for any loss, damages, expense or
cost arising out of any telephone exchange authorization to the extent and
subject to the requirements set forth under "HOW MAY I REDEEM MY
SHARES? -- Redemption by telephone" above.

For tax purposes, an exchange is treated as a redemption and a new
purchase. However, a shareholder may not include any sales charge on Shares of
the Fund for purposes of calculating the gain or loss realized upon an exchange
of those Shares within 90 days of their purchase.

The Group may, at any time, modify or terminate the foregoing exchange
privilege. The Group, however, will give shareholders of the Fund 60 days'
advance written notice of any such modification or termination.

13
<PAGE> 14

HOW IS NET ASSET VALUE CALCULATED?

The net asset value of the Fund is determined once daily as of 4:00 P.M.
Eastern Time, on each Business Day. A "Business Day" is a day on which the New
York Stock Exchange is open for business and any other day (other than a day on
which no Shares of the Fund are tendered for redemption and no order to purchase
any Shares of the Fund is received) during which there is a sufficient degree of
trading in the Fund's portfolio securities that the net asset value might be
materially affected by changes in the value of the portfolio securities. The net
asset value per share of the Fund is computed by dividing the sum of the value
of the Fund's portfolio securities plus any cash and other assets (including
interest and dividends accrued but not received) minus all liabilities
(including estimated accrued expenses) by the total number of Shares then
outstanding.

The net asset value per share will fluctuate as the value of the investment
portfolio of the Fund changes.

Portfolio securities which are traded on United States stock exchanges are
valued at the last sale price on such an exchange as of the time of valuation on
the day the securities are being valued. Securities traded in the
over-the-counter market are valued at either the mean between the bid and ask
prices or the last sale price as one or the other may be quoted by the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") as of
the time of valuation on the day the securities are being valued. The Group uses
one or more pricing services to provide such market quotations. Securities and
other assets for which market quotations are not readily available are valued at
fair value as determined in good faith by or under the direction of the Board of
Trustees of the Group.

Determination of the net asset value may be suspended at times when (a)
trading on the New York Stock Exchange is restricted by applicable rules and
regulations of the Commission, (b) the New York Stock Exchange is closed for
other than customary weekend and holiday closings, (c) an emergency exists as a
result of which disposal by the Group of portfolio securities owned by the Fund
or valuation of net assets of the Fund is not reasonably practicable, or (d) the
Commission has by order permitted such suspension.

DOES THE FUND PAY FEDERAL INCOME TAX?

Each of the funds of the Group, including the Fund, is treated as a
separate entity for federal income tax purposes and intends to qualify as a
"regulated investment company" under the Code for so long as such qualification
is in the best interest of that fund's shareholders. Qualification as a
regulated investment company under the Code requires, among other things, that
the regulated investment company distribute to its shareholders at least 90% of
its investment company taxable income. The Fund contemplates declaring as
dividends 100% of the Fund's investment company taxable income (before deduction
of dividends paid).

A non-deductible 4% excise tax is imposed on regulated investment companies
that do not distribute in each calendar year (regardless of whether they
otherwise have a non-calendar taxable year) an amount equal to 98% of their
ordinary income for the calendar year plus 98% of their capital gain net income
for the one-year period ending on October 31 of such calendar year. The balance
of such income must be distributed during the next calendar year. If
distributions during a calendar year were less than the required amount, the
Fund would be subject to a nondeductible excise tax equal to 4% of the
deficiency.

WHAT ABOUT MY TAXES?

14
<PAGE> 15

income tax purposes, even if paid in additional Shares of the Fund and not in
cash. The dividends-received deduction for corporations will apply to the
aggregate of such ordinary income distributions in the same proportion as the
aggregate dividends eligible for the dividends received deduction, if any,
received by the Fund bear to its gross income.

Distribution by the Fund of the excess of net long-term capital gain over
net short-term capital loss is taxable to shareholders as long-term capital gain
in the year in which it is received, regardless of how long the shareholder has
held the Shares. Such distributions are not eligible for the dividends-received
deduction.

If the net asset value of a Share is reduced below the shareholder's cost
of that Share by the distribution of income or gain realized on the sale of
securities, the distribution is a return of invested principal, although taxable
as described above.

Prior to purchasing Shares, the impact of dividends or capital gains
distributions which are expected to be declared or have been declared, but have
not been paid, should be carefully considered. Any such dividends or capital
gains distributions paid shortly after a purchase of Shares prior to the record
date will have the effect of reducing the per share net asset value of the
Shares by the amount of the dividends or distributions. All or a portion of such
dividends or distributions, although in effect a return of capital, is subject
to tax.

Foreign taxes may be imposed on the Fund by foreign countries with respect
to its income from foreign securities. Since less than 50% in value of the
Fund's total assets at the end of its fiscal year are expected to be invested in
stock or securities of foreign corporations, the Fund will not be entitled under
the Code to pass through to its shareholders their pro rata share of the foreign
taxes paid by the Fund. These taxes will be taken as a deduction by the Fund.

The foregoing is intended only as a brief summary of some of the important
tax considerations generally affecting the Fund and its shareholders. Potential
investors in the Fund are urged to consult their tax advisers concerning the
application of federal, state and local taxes as such laws and regulations
affect their own tax situation.

The Transfer Agent will inform shareholders at least annually of the amount
and nature of such income and capital gains.

WHO MANAGES MY INVESTMENT IN THE FUND?

Except where shareholder action is required by law, all of the authority of
the Group is exercised under the direction of the Group's Trustees, who are
elected by the shareholders of the Group's funds and who are empowered to elect
officers and contract with and provide for the compensation of agents,
consultants and other professionals to assist and advise it in its day-to-day
operations. The Group will be managed in accordance with its Declaration of
Trust and the laws of Ohio governing business trusts.

The Trustees of the Group receive fees and are reimbursed for their
expenses in connection with each meeting of the Board of Trustees they attend.
However, no officer or employee of the Adviser or The Ohio Company receives any
compensation from the Group for acting as a Trustee of the Group. The officers
of the Group receive no compensation directly from the Group for performing the
duties of their offices. The Adviser receives fees from the Group for acting as
investment adviser and manager and as dividend and transfer agent. The Ohio
Company receives no fees under its Distribution Agreement with the Group but may
retain all or a portion of the sales charge and may receive fees under the
Distribution Plan discussed below.

15
<PAGE> 16

INVESTMENT ADVISER AND MANAGER

Cardinal Management Corp. (the "Adviser"), 155 East Broad Street, Columbus,
Ohio 43215, a wholly owned subsidiary of The Ohio Company, is the investment
adviser and manager of the Fund. The Adviser is also the investment adviser and
manager of each of the other Cardinal Funds.

The Ohio Company, an investment banking firm organized in 1925, is a member
of the New York and Chicago Stock Exchanges, other regional stock exchanges and
the National Association of Securities Dealers, Inc. Descendants of H.P. and
R.F. Wolfe, deceased, and members of their families, through their possession of
a majority of a voting stock, may be considered controlling persons of The Ohio
Company. The Ohio Company serves as principal underwriter for each of the
Cardinal Funds and for TCFI and serves as the investment adviser of TCFI.

In its capacity as investment adviser, and subject to the ultimate
authority of the Group's Board of Trustees, the Adviser, in accordance with the
Fund's investment objectives and policies, manages the Fund, and makes decisions
with respect to and places orders for all purchases and sales of its portfolio
securities. Since December 22, 1995, John Bevilacqua has been primarily
responsible for the day-to-day management of the portfolio of TCFI (the Fund's
predecessor). It is expected that, upon consummation of the Reorganization, Mr.
Bevilacqua will be the portfolio manager for the Fund. Mr. Bevilacqua has been a
Vice President and Portfolio Manager for The Ohio Company since October, 1994.
Prior thereto, and since February, 1984, Mr. Bevilacqua served as Second Vice
President -- Investments for Midland Mutual Life Insurance Company, Columbus,
Ohio. In addition, pursuant to the Investment Advisory Agreement, the Adviser
generally assists in all aspects of the Fund's administration and operation.

For the services provided and expenses assumed pursuant to its investment
advisory agreement with the Group with respect to the Fund, the Adviser receives
a fee from the Fund, computed daily and paid monthly at the annual rate of .60%
of average net daily assets of the Fund. The Adviser may, however, periodically
waive all or a portion of its advisory fee with respect to the Fund to increase
the net income of the Fund available for distribution as dividends. The waiver
of such fee will cause the return of the Fund to be higher than it would
otherwise be in the absence of such a waiver.

DIVIDEND AND TRANSFER AGENT AND FUND ACCOUNTANT

The Group has entered into a Transfer Agency and Fund Accounting Agreement
with Cardinal Management Corp. (the "Transfer Agent"), 215 East Capital Street,
Columbus, Ohio 43215, pursuant to which the Transfer Agent has agreed to act as
the Fund's transfer agent and dividend disbursing agent. In consideration of
such services, the Fund has agreed to pay the Transfer Agent an annual fee, paid
monthly, equal to $18 per shareholder account plus out-of-pocket expenses. In
addition, the Transfer Agent provides certain fund accounting services for the
Fund. The Transfer Agent receives a fee from the Fund for such services equal to
a fee computed daily and paid periodically at an annual rate of .03% of the
Fund's average daily net assets.

DISTRIBUTOR

The Group has entered into a Distributor's Contract with The Ohio Company,
155 East Broad Street, Columbus, Ohio 43215, pursuant to which Shares of the
Fund will be offered continuously on a best efforts basis by The Ohio Company
and dealers selected by The Ohio Company. H. Keith Allen is an officer and
trustee of the Group and an officer and director of The Ohio Company. Frank W.
Siegel is an officer and trustee of the Group and an officer of The Ohio
Company. James M. Schrack II is an officer of both the Group and The Ohio
Company.

16
<PAGE> 17

EXPENSES

The Adviser bears all expenses in connection with the performance of its
services as investment adviser, manager, transfer agent and fund accountant
other than the cost of securities (including brokerage commissions, if any)
purchased for the Fund. The Fund will bear the following expenses relating to
its operations: organizational expenses, taxes, interest, any brokerage fees and
commissions, fees and expenses of the Trustees of the Group, Commission fees,
state securities qualification fees, costs of preparing and printing
prospectuses for regulatory purposes and for distribution to the Fund's current
shareholders, outside auditing and legal expenses, advisory fees, fund
accounting fees, fees and out-of-pocket expenses of the custodian and Transfer
Agent, costs for independent pricing services, certain insurance premiums, costs
of maintenance of the Group's existence, costs of shareholders' reports and
meetings, distribution expenses incurred pursuant to the Distribution and
Shareholder Service Plan described below, and any extraordinary expenses
incurred in the Fund's operation.

DISTRIBUTION PLAN

Pursuant to Rule 12b-1 under the 1940 Act, the Group has adopted a
Distribution and Shareholder Service Plan (the "Plan"), under which the Fund is
authorized to pay The Ohio Company, as the Fund's principal underwriter, a
periodic amount calculated at an annual rate not to exceed twenty-five
one-hundredths of one percent (.25%) of the average daily net asset value of the
Fund. Such amount may be used by The Ohio Company to pay broker-dealers
(including The Ohio Company), banks and other institutions (a "Participating
Organization") for distribution and/or shareholder service assistance pursuant
to an agreement between The Ohio Company and the Participating Organization or
for distribution assistance and/or shareholder service provided by The Ohio
Company pursuant to an agreement between The Ohio Company and the Group. Under
the Plan, a Participating Organization may include The Ohio Company, its
subsidiaries, and its affiliates. The Ohio Company may from time to time waive
all or a portion of the fees payable to it pursuant to the Plan. Any such waiver
will cause the total return of the Fund to be higher than it would otherwise be
absent such a waiver.

As authorized by the Plan, The Ohio Company has entered into a Rule 12b-1
Agreement with the Group pursuant to which The Ohio Company has agreed to
provide certain shareholder services in connection with Shares of the Fund
purchased and held by The Ohio Company for the accounts of its customers and
Shares of the Fund purchased and held by customers of The Ohio Company directly,
including, but not limited to, answering shareholder questions concerning the
Fund, providing information to shareholders on their investments in the Fund and
providing such personnel and communication equipment as is necessary and
appropriate to accomplish such matters. In consideration of such services the
Group has agreed to pay The Ohio Company a monthly fee, computed at the annual
rate of .25% of the average aggregate net asset value of Shares held during the
period in customer accounts for which The Ohio Company has provided services
under this Agreement. Such fees paid by the Group will be borne solely by the
Fund. Such fee may exceed the actual costs incurred by The Ohio Company in
providing such services.

In addition, The Ohio Company may enter into, from time to time, other Rule
12b-1 Agreements with selected dealers pursuant to which such dealers will
provide certain shareholder services such as those described above.

CUSTODIAN

The Group has appointed The Fifth Third Bank ("Fifth Third") 38 Fountain
Square Plaza, Cincinnati, Ohio 45263, as the Fund's custodian. In such capacity,
Fifth Third will hold or arrange for the holding of all portfolio securities and
other assets acquired and owned by the Fund.

17
<PAGE> 18

WHAT ARE MY RIGHTS AS A SHAREHOLDER?

The Group was organized as an Ohio business trust on March 23, 1993. The
Group currently consists of six funds, each having its own class of shares. The
other funds of the Group are Cardinal Balanced Fund, Cardinal Aggressive Growth
Fund, Cardinal Government Obligations Fund, Cardinal Government Securities Money
Market Fund and Cardinal Tax Exempt Money Market Fund. Each share represents an
equal proportional interest in a fund with other shares of the same fund, and is
entitled to such dividends and distributions out of the income earned on the
assets belonging to that fund as are declared at the discretion of the Trustees.

Shareholders are entitled to one vote for each dollar of value invested and
a proportionate fractional vote for any fraction of a dollar invested, and will
vote in the aggregate and not by series except as otherwise expressly required
by law. For example, shareholders of the Fund will vote in the aggregate with
other shareholders of the Group with respect to the election of trustees and
ratification of the selection of independent accountants. However, shareholders
of the Fund will vote as a fund, and not in the aggregate with other
shareholders of the Group, for purposes of approval of amendments to the Fund's
investment advisory agreement, the Plan or any of the Fund's fundamental
policies.

Overall responsibility for the management of the Fund is vested in the
Board of Trustees of the Group. See "WHO MANAGES MY INVESTMENT OF THE FUND?"
Individual Trustees are elected by the shareholders of the Group and may be
removed by the Board of Trustees or shareholders in accordance with the
provisions of the Declaration of Trust and By-Laws of the Group and Ohio law.
See "ADDITIONAL INFORMATION -- Miscellaneous" in the Statement of Additional
Information for further information.

An annual or special meeting of shareholders to conduct necessary business
is not required by the Declaration of Trust, the 1940 Act or other authority
except, under certain circumstances, to elect Trustees, amend the Declaration of
Trust, approve the investment advisory agreement and to satisfy certain other
requirements. To the extent that such a meeting is not required, the Group does
not intend to have an annual or special meeting.

The Group has represented to the Commission that the Trustees will call a
special meeting of shareholders for purposes of considering the removal of one
or more Trustees upon written request therefor from shareholders holding not
less than 10% of the outstanding votes of the Group and that the Group will
assist in communications with other shareholders as required by Section 16(c) of
the 1940 Act. At such meeting, a quorum of shareholders (constituting a majority
of votes attributable to all outstanding shares of the Group), by majority vote,
has the power to remove one or more Trustees.

As used in this Prospectus and in the Statement of Additional Information,
"assets belonging to a fund" means the consideration received by the fund upon
the issuance or sale of shares in that fund, together with all income, earnings,
profits, and proceeds derived from the investment thereof, including any
proceeds from the sale, exchange, or liquidation of such investments, and any
funds or amounts derived from any reinvestment of such proceeds, and any general
assets of the Group not readily identified as belonging to a particular fund
that are allocated to the fund by the Group's Board of Trustees. The Board of
Trustees may allocate such general assets in any manner it deems fair and
equitable. Determinations by the Board of Trustees of the Group as to the timing
of the allocation of general liabilities and expenses and as to the timing and
allocable portion of any general assets with respect to the Fund are conclusive.

As used in this Prospectus and in the Statement of Additional Information,
a "vote of a majority of the outstanding Shares" of the Fund means the
affirmative vote, at a meeting of shareholders duly called, of the lesser of (a)
67% or more of the votes of shareholders of the Fund present at a meeting at
which the holders of more than 50% of the votes attributable to shareholders of
record of

18
<PAGE> 19

the Fund are represented in person or by proxy, or (b) the holders of more than
50% of the outstanding votes of shareholders of the Fund.

Shareholders should direct all inquiries concerning such matters to the
Transfer Agent in writing to 215 East Capital Street, Columbus, Ohio 43215, or
by calling (800) 282-9446.

Shareholders will receive unaudited semi-annual reports describing the
investment operations of the Fund and annual financial reports audited by
independent auditors.

19
<PAGE> 20

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<PAGE> 21

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<PAGE> 22

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<PAGE> 23

Investment Adviser and Manager
Cardinal Management Corp.
155 East Broad Street
Columbus, Ohio 43215

Distributor
The Ohio Company
155 East Broad Street
Columbus, Ohio 43215

Transfer Agent and Dividend Paying Agent
Cardinal Management Corp.
215 East Capital Street
Columbus, Ohio 43215

Custodian
The Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263

Legal Counsel
Baker & Hostetler
65 East State Street
Columbus, Ohio 43215

Independent Auditors
KPMG Peat Marwick LLP
Two Nationwide Plaza
Columbus, Ohio 43215
<PAGE> 24

- ------------------------------------------------------
- ------------------------------------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS HIGHLIGHTS................. 2
FEE TABLE............................. 3
PERFORMANCE INFORMATION............... 4
WHAT IS THE FUND?..................... 4
WHAT ARE THE INVESTMENT OBJECTIVES AND
POLICIES OF THE FUND?............... 4
HOW DO I PURCHASE SHARES OF THE
FUND?............................... 8
MAY MY TAX SHELTERED RETIREMENT PLAN
INVEST IN THE FUND?................. 9
HOW MAY I QUALIFY FOR QUANTITY
DISCOUNTS?.......................... 10
WHAT DISTRIBUTIONS WILL I RECEIVE?.... 11
HOW MAY I REDEEM MY SHARES?........... 11
WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED?........................... 12
HOW IS NET ASSET VALUE CALCULATED?.... 14
DOES THE FUND PAY FEDERAL INCOME
TAX?................................ 14
WHAT ABOUT MY TAXES?.................. 14
WHO MANAGES MY INVESTMENT IN THE
FUND?............................... 15
WHAT ARE MY RIGHTS AS A
SHAREHOLDER?........................ 18
</TABLE>

------------------------

NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS AND, IF
GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON
AS HAVING BEEN AUTHORIZED BY THE FUND, THE ADVISER, OR THE OHIO COMPANY. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER BY THE FUND OR BY THE OHIO COMPANY TO
SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY
IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL FOR THE FUND TO MAKE
SUCH AN OFFER IN SUCH JURISDICTION.

- ------------------------------------------------------
- ------------------------------------------------------

The Ohio Company

THE CARDINAL FUND
------------------------

PROSPECTUS

------------------------

January 10, 1996

- ------------------------------------------------------
- ------------------------------------------------------

<PAGE> 25

PROSPECTUS Rule 497(c) File No. 811-7588

CARDINAL GOVERNMENT OBLIGATIONS FUND

Cardinal Government Obligations Fund (the "Fund") is a diversified
investment fund of The Cardinal Group (the "Group"), an open-end, management
investment company. The Trustees of the Group have divided the Fund's beneficial
ownership into an unlimited number of transferable units called shares (the
"Shares").

The Fund's investment objectives are to maximize safety of capital and,
consistent with such objective, earn the highest available current income
obtainable from government securities. The current income earned from such
government securities may not be as great as the current income earned on lower
quality securities which have less liquidity and greater risk of nonpayment.
There can be no assurance that the Fund's objectives will be achieved.

For further information regarding the Fund or for assistance in opening an
account
or redeeming Shares, please call (800) 282-9446 toll free.

Inquiries may also be made by mail addressed to the Fund at its principal
office:

155 East Broad Street
Columbus, Ohio 43215
- --------------------------------------------------------------------------------

The Prospectus relates only to Cardinal Government Obligations Fund,
currently one of six funds of the Group. Interested persons who wish to obtain
prospectuses of The Cardinal Fund, Cardinal Government Securities Money Market
Fund, Cardinal Tax Exempt Money Market Fund, Cardinal Balanced Fund or Cardinal
Aggressive Growth Fund should contact The Ohio Company. Additional information
about the Fund, contained in a Statement Of Additional Information, dated as of
January 10, 1996, has been filed with the Securities and Exchange Commission and
is incorporated herein by reference. Such Statement is available upon request
without charge from the Fund at the above address or by calling the phone number
provided above.

This Prospectus sets forth concisely the information about the Fund that a
prospective investor ought to know before investing in the Fund. This Prospectus
should be retained for future reference.

The Ohio Company

The date of this Prospectus is January 10, 1996.

<PAGE> 26

PROSPECTUS HIGHLIGHTS

INVESTMENT OBJECTIVES......... The Fund seeks to maximize safety of capital
and, consistent with such objective, earn the
highest available current income obtainable
from government securities. (See page 5.)

INVESTMENT POLICIES........... Under normal market conditions, the Fund
invests substantially all but in no event less
than 65% of its total assets in obligations
issued or guaranteed by the U.S. Government,
its agencies or instrumentalities and
repurchase agreements secured by securities of
the U.S. Government. Under present market
conditions, the Fund expects to invest a
substantial amount of its portfolio in Ginnie
Mae certificates. These investments entail
certain risks. (See pages 5 and 6.)

CURRENT INCOME................ Dividends are declared daily and distributions
are generally made monthly as the Fund shall
determine. Long-term capital gains, if any, are
distributed annually. (See page 13.)

PURCHASES..................... There is a minimum initial investment of $1,000
with subsequent minimums of $50. (See page 10.)
Purchases are made at the public offering price
which is equal to net asset value per share
plus a sales charge. This charge is equal to
4.50% of the public offering price (4.71% of
net amount invested) reduced on investments of
$100,000 or more (see page 10) and waived for
certain purchasers for whom The Ohio Company
serves as a trustee or investment adviser. (See
page 11.)

REDEMPTIONS................... Shares can be redeemed at net asset value per
share without charge, if redeemed through the
Fund's distributor, The Ohio Company. (See page
13.)

INVESTMENT ADVISER AND
MANAGER..................... Cardinal Management Corp. (the "Adviser"), a
wholly-owned subsidiary of The Ohio Company, is
the Fund's investment adviser. The Adviser also
serves as investment adviser for The Cardinal
Fund, Cardinal Government Securities Money
Market Fund, Cardinal Tax Exempt Money Market
Fund, Cardinal Balanced Fund and Cardinal
Aggressive Growth Fund (collectively, with the
Fund, the "Cardinal Funds"). (See page 17.)

RISK FACTORS AND SPECIAL
CONSIDERATIONS.............. An investment in a mutual fund such as the Fund
involves a certain amount of risk and may not
be suitable for all investors. Some investment
policies of the Fund may entail certain risks.
(See "WHAT ARE THE INVESTMENT OBJECTIVES AND
POLICIES OF THE FUND? -- Risk Factors and
Investment Techniques" on pages 6 through 9.)

2
<PAGE> 27

FEE TABLE

<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of offering price)......... 4.50%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees..................................................................... .50%
12b-1 Fees After Fee Waiver(1)...................................................... 0
Other Expenses(2)................................................................... .24
----
Total Fund Operating Expenses After Fee Waiver.............................. .74%
====
</TABLE>

EXAMPLE

- ---------------
(1) The Ohio Company, as the Fund's distributor, has agreed with the Group to
waive all of its Rule 12b-1 fees until September 30, 1996. Absent such
waiver, Rule 12b-1 Fees and Total Fund Operating Expenses would be 0.25% and
0.99%, respectively.

(2) "Other Expenses" are based upon estimated amounts for the current fiscal
year.

3
<PAGE> 28

PERFORMANCE INFORMATION

From time to time the Fund may advertise its average annual total return,
cumulative return and/or yield. SUCH RETURN AND YIELD FIGURES ARE BASED UPON
HISTORICAL EARNINGS AND ARE NOT INTENDED TO INDICATE FUTURE PERFORMANCE. The
average annual total return advertised by the Fund refers to the return
generated by an investment in the Fund over certain specified periods since the
establishment of the Fund. The average annual total return over a period equates
the amount of an initial investment in the Fund to the amount redeemable at the
end of that period assuming that any dividends and distributions earned by an
investment in the Fund are immediately reinvested and the maximum applicable
sales charge (currently 4.5%) is deducted from the initial investment at the
time of investment. Such figure is then annualized. The cumulative return
advertised refers to the total return on a hypothetical investment over the
relevant period and equates the amount of an initial investment in the Fund to
the amount redeemable at the end of that period assuming that any dividends and
distributions are immediately reinvested and the maximum sales charge is
deducted from the initial investment. Yield will be computed by dividing the
Fund's net investment income per share earned during a recent one-month period
by the Fund's per share maximum offering price (reduced by any undeclared earned
income expected to be paid shortly as a dividend) on the last day of the period
and annualizing the result. If the sales charge were not deducted, the average
annual total return, cumulative return and yield advertised would be higher.

In addition, from time to time the Fund may include in its sales literature
and shareholder reports a quote of the current "distribution" rate for the Fund.
A distribution rate is simply a measure of the level of dividends distributed
for a specified period and is computed by dividing the total amount of dividends
per share paid by the Fund during the past 12 months by a current maximum
offering price. It differs from yield, which is a measure of the income actually
earned by the Fund's investments, and from total return, which is a measure of
the income actually earned by, plus the effect of any realized and unrealized
appreciation or depreciation of, such investments during a stated period. A
distribution rate is, therefore, not intended to be a complete measure of
performance. A distribution rate may sometimes be greater than yield since, for
instance, it may include short-term and possibly long-term gains (which may be
non-recurring), may not include the effect of amortization of bond premiums and
does not reflect unrealized gains or losses.

WHAT IS THE FUND?

The Fund is one separate diversified investment fund of the Group, which
was organized on March 23, 1993, as an Ohio business trust. The Group is
registered and operates as an open-end management investment company as defined
in the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund has
been organized for the purpose of acquiring all of the assets and liabilities of
Cardinal Government Obligations Fund ("CGOF") to effect a reorganization of CGOF
from a stand-alone investment company to a separate series of the Group (the
"Reorganization").

The Fund is designed for individuals, corporations, fiduciaries, and
institutions who wish to invest for current income in a diversified,
professionally managed portfolio of securities issued by the U.S. Government and
securities directly guaranteed by the full faith and credit of the U.S.

4
<PAGE> 29

Government -- without having to become involved in the detailed accounting and
safekeeping procedures normally associated with direct investment in these
securities.

WHAT ARE THE INVESTMENT OBJECTIVES
AND POLICIES OF THE FUND?

IN GENERAL

The Fund's investment objectives are a fundamental policy of the Fund,
which means that they may be changed only with the approval of a majority of the
outstanding Shares of the Fund (as defined below under "WHAT ARE MY RIGHTS AS A
SHAREHOLDER?). There can be no assurance that the investment objectives of the
Fund will be achieved.

Under normal market conditions, the Fund will invest substantially all, but
in no event less than 65% of the value of its total assets, in obligations
issued or guaranteed by the U.S. Government or its agencies or instrumentalities
("U.S. Government Securities"). The Fund may also invest, under normal market
conditions, in the fixed income instruments described below and in repurchase
agreements. It may also engage in the options transactions described below.

The Fund may, for daily cash management purposes, invest in high quality
money market securities and in repurchase agreements. In addition, the Fund may
invest, without limit, in any combination of U.S. Government Securities, money
market securities and repurchase agreements when, in the opinion of the Adviser,
it is determined that a temporary defensive position is warranted based upon
current market conditions. The Fund may also invest in securities of other
investment companies, as described more fully below.

The types of U.S. Government Securities invested in by the Fund will
include obligations issued by or guaranteed as to payment of principal and
interest by the full faith and credit of the U.S. Treasury, such as Treasury
bills, notes, bonds and certificates of indebtedness, and obligations issued or
guaranteed by the agencies or instrumentalities of the U.S. Government, but not
supported by such full faith and credit. Obligations of certain agencies and
instrumentalities of the U.S. Government, such as the Government National
Mortgage Association ("Ginnie Mae") and the Export-Import Bank of the United
States, are supported by the full faith and credit of the U.S. Treasury; others,
such as those of the Federal National Mortgage Association, are supported by the
right of the issuer to borrow from the Treasury; others are supported by the
discretionary authority of the U.S. Government to purchase the agency's
obligations; still others, such as those of the Federal Farm Credit Banks or the
Federal Home Loan Mortgage Corporation, are supported only by the credit of the
instrumentality. No assurance can be given that the U.S. Government would
provide financial support to U.S. Government sponsored agencies or
instrumentalities if it is not obligated to do so by law. The Fund will invest
in the obligations of such agencies or instrumentalities only when the Adviser
believes that the credit risk with respect thereto is minimal.

Certain securities held by the Fund may have mortgage obligations backing
such securities, including among others, conventional thirty year fixed rate
mortgage obligations, graduated payment mortgage obligations, fifteen year
mortgage obligations and adjustable rate mortgage obligations. All of these
mortgage obligations can be used to create pass-through securities. A pass-
through security is created when mortgage obligations are pooled together and
undivided interests in the pool or pools are sold. The cash flow from the
mortgage obligations is passed through to the holders of the securities in the
form of periodic payments of interest, principal and prepayments (net of a
service fee). Prepayments occur when the holder of an individual mortgage
obligation prepays

5
<PAGE> 30

the remaining principal before the mortgage obligation's scheduled maturity
date. As a result of the pass-through of prepayments of principal on the
underlying securities, mortgage-backed securities are often subject to more
rapid prepayment of principal than their stated maturity would indicate. Because
the prepayment characteristics of the underlying mortgage obligations vary, it
is not possible to predict accurately the realized yield or average life of a
particular issue of pass-through certificates. Prepayment rates are important
because of their effect on the yield and price of the securities. Accelerated
prepayments have an adverse impact on yields for pass-through certificates
purchased at a premium (i.e., a price in excess of principal amount) and may
involve additional risk of loss of principal because the premium may not have
been fully amortized at the time the obligation is repaid. The opposite is true
for pass-through certificates purchased at a discount. The Fund may purchase
mortgage-related securities at a premium or at a discount. Reinvestment of
principal payments may occur at higher or lower rates than the original yield on
such securities. Due to the prepayment feature and the need to reinvest payments
and prepayments of principal at current rates, mortgage-related securities can
be less effective than typical bonds of similar maturities at maintaining yields
during periods of declining interest rates.

Certain debt securities such as, but not limited to, mortgage backed
securities, as well as other securities subject to prepayment of principal prior
to the stated maturity date, are expected to be repaid prior to their stated
maturity dates. As a result, the effective maturity of these securities is
expected to be shorter than the stated maturity. For purposes of calculating the
Fund's weighted average portfolio maturity, the effective maturity of such
securities will be used.

Under present market conditions, the Fund expects to invest a substantial
amount of its portfolio in Ginnie Mae certificates, which are mortgage-backed
securities representing part ownership in a specific pool of mortgage loans
insured by the Federal Housing Administration or Farmers Home Administration or
guaranteed by the Veterans Administration. Should market or economic conditions
warrant, this practice may be changed at the discretion of the Adviser. Ginnie
Mae guarantees the timely payment of monthly installments of principal and
interest on its certificates, when due, whether or not payments are received on
the underlying mortgage loans, and the full faith and credit of the United
States is pledged to the timely payment by Ginnie Mae of such principal and
interest.

Although the mortgage loans in the pool underlying a Ginnie Mae certificate
will have maturities of up to thirty years, the actual average life of the
Ginnie Mae certificates typically will be substantially less because the
mortgage loans will be subject to normal principal amortization and may be
prepaid prior to maturity. Prepayment rates vary widely and may be affected by
changes in market interest rates and general economic conditions. In periods of
falling interest rates, the rate of prepayment tends to increase, thereby
shortening the actual average life of the Ginnie Mae certificates and shortening
the period of time over which income at the higher rate is received. Conversely,
when interest rates are rising, the rate of prepayment tends to decrease,
thereby lengthening the actual average life of the Ginnie Mae certificates and
extending the period of time over which income at the lower rates is received.
Accordingly, it is not possible to accurately predict the average life of a
particular pool. Standard practice is to treat Ginnie Mae certificates as having
effective maturities of twelve years. Reinvestment of principal payments may
occur at higher or lower rates than the original yield on the certificates. Due
to the prepayment feature and the need to reinvest payments and prepayments of
principal at current rates, Ginnie Mae certificates can be less effective than
typical bonds of similar maturities at maintaining yields during periods of
declining interest rates.

RISK FACTORS AND INVESTMENT TECHNIQUES

GENERAL. Like any investment program, an investment in the Fund entails
certain risks. The value of the Fund's portfolio securities, and therefore the
Fund's net asset value per share, may increase or decrease due to various
factors, principally changes in prevailing interest rates.

6
<PAGE> 31

Generally, a rise in interest rates will result in a decrease in the Fund's net
asset value per share, while a drop in interest rates will result in an increase
in the Fund's net asset value per share.

WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS. The Fund may also purchase
securities on a when-issued or delayed-delivery basis. The Fund will engage in
when-issued and delayed-delivery transactions only for the purpose of acquiring
portfolio securities consistent with its investment objectives and policies, not
for investment leverage, although such transactions represent a form of
leveraging. When-issued securities are securities purchased for delivery beyond
the normal settlement date at a stated price and yield and thereby involve a
risk that the yield obtained in the transaction will be less than those
available in the market when delivery takes place. The Fund will not pay for
such securities or start earning interest on them until they are received. When
the Fund agrees to purchase such securities, its custodian will set aside cash
or liquid securities equal to the amount of the commitment in a separate
account. Securities purchased on a when-issued basis are recorded as an asset
and are subject to changes in the value based upon changes in the general level
of interest rates. In when-issued and delayed-delivery transactions, the Fund
relies on the seller to complete the transaction; the seller's failure to do so
may cause the Fund to miss a price or yield considered to be advantageous.

The Fund's commitments to purchase when-issued securities will not exceed
25% of the value of its total assets absent unusual market conditions. In the
event that its commitments to purchase when-issued securities ever exceed 25% of
the value of its assets, the Fund's liquidity and the ability of the Adviser to
manage it might be adversely affected.

PUT AND CALL OPTIONS. Subject to its investment policies and for purposes
of hedging against market risks related to its portfolio securities, the Fund
may purchase put and call options on securities. Purchasing options is a
specialized investment technique that entails a substantial risk of a complete
loss of the amounts paid as premiums to writers of options. The Fund will
purchase put options only on securities in which the Fund may otherwise invest.
The Fund may also engage in writing call options from time to time as the
Adviser deems appropriate. The Fund will write only covered call options
(options on securities owned by the Fund). In order to close out a call option
it has written, the Fund will enter into a "closing purchase transaction" -- the
purchase of a call option on the same security with the same exercise price and
expiration date as the call option which the Fund previously has written. When a
portfolio security subject to a call option is sold, the Fund will effect a
closing purchase transaction to close out any existing call option on that
security. If

7
<PAGE> 32

the Fund is unable to effect a closing purchase transaction, it will not be able
to sell the underlying security until the option expires or the Fund delivers
the underlying security upon exercise. Under normal market conditions, it is not
expected that the underlying value of portfolio securities subject to such
options would exceed 25% of the net assets of the Fund.

8
<PAGE> 33

additional risks. There is no assurance of liquidity in the secondary market for
purposes of closing out futures positions.

INVESTMENT COMPANY SECURITIES. The Fund may also invest up to 10% of the
value of its total assets in the securities of other investment companies
subject to the limitations set forth in the 1940 Act. The Fund intends to invest
in the securities of other investment companies which, in the opinion of the
Adviser, will assist the Fund in achieving its objectives and in money market
mutual funds for purposes of short-term cash management. The Fund's investment
in such other investment companies may result in the duplication of fees and
expenses, particularly investment advisory fees. For a further discussion of the
limitations on the Fund's investments in other investment companies, see
"INVESTMENT OBJECTIVES AND POLICIES -- Additional Information on Portfolio
Instruments -- Securities of Other Investment Companies" in the Fund's Statement
of Additional Information.

INVESTMENT RESTRICTIONS

The Fund will not:

9
<PAGE> 34

The following additional investment restriction may be changed without the
vote of a majority of the outstanding Shares of the Fund. The Fund may not:

1. Purchase or otherwise acquire any securities, if as a result, more
than 15% of the Fund's net assets would be invested in securities that are
illiquid.

HOW DO I PURCHASE SHARES OF THE FUND?

GENERAL

PUBLIC OFFERING PRICE

(See "HOW IS NET ASSET VALUE CALCULATED?" for a description of the
computation of net asset value per share.)

10
<PAGE> 35

From time to time, The Ohio Company, from its own resources, may also
provide additional compensation to securities dealers in connection with sales
of Shares of the Cardinal Funds. Such compensation will include financial
assistance to securities dealers in connection with conferences, sales or
training programs for their employees, seminars for the public, advertising,
sales campaigns and/or shareholder services and programs regarding one or more
of the Cardinal Funds and other dealer-sponsored programs or events. In some
instances, this compensation may be made available only to certain securities
dealers whose representatives have sold or are expected to sell significant
amounts of shares of the Cardinal Funds. Compensation will include payment for
travel expenses, including lodging, incurred in connection with trips taken by
invited registered representatives and members of their families to locations
within or outside of the United States for meetings or seminars of a business
nature. Securities dealers may not use sales of the Fund's Shares to qualify for
this compensation to the extent such may be prohibited by the laws of any state
or any self-regulatory agency, such as the National Association of Securities
Dealers, Inc. In addition, The Ohio Company may make ongoing payments to
brokerage firms, financial institutions (including banks) and others to
facilitate the administration and servicing of shareholder accounts. None of the
aforementioned additional compensation is paid for by the Fund or its
shareholders.

AUTOMATIC INVESTMENT PLAN

MAY MY TAX SHELTERED RETIREMENT
PLAN INVEST IN THE FUND?

Shares of the Fund qualify for purchase in connection with the following
tax sheltered retirement plans:

-- Individual retirement account ("IRAs") plans

-- Simplified Employee Pension Plans

-- 403(b)(7) Custodial Plans sponsored by certain tax-exempt employers

-- Pension, profit-sharing and 401(k) plans qualifying under Section 401(a)
of the Internal Revenue Code

HOW MAY I QUALIFY FOR QUANTITY DISCOUNTS?

LETTER OF INTENTION

11
<PAGE> 36

on the date of the earliest purchase to be included. In addition, trustees,
guardians or other like fiduciaries of single trust estates or certain single
fiduciary accounts may take advantage of the quantity discounts pursuant to a
letter of intention.

CONCURRENT PURCHASES

RIGHTS OF ACCUMULATION

12
<PAGE> 37

WHAT DISTRIBUTIONS WILL I RECEIVE?

A dividend consisting of net income is declared daily to Shareholders of
the Fund at the close of business on the day of declaration, and such dividends
are generally paid monthly. Dividends consisting of long-term capital gains
normally will be distributed only once annually. Dividends and distributions
will be paid only in additional Shares and not in cash; except, however, that
for dividends and distributions of $10 or more, a shareholder may specifically
request that such amounts be paid to him in cash. Dividends are paid in cash not
later than seven days after a shareholder's complete redemption of his Shares in
the Fund.

Shareholders may also elect to receive dividends and distributions in cash
by using ACH processing as described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED? -- ACH Processing" below.

HOW MAY I REDEEM MY SHARES?

The Group may suspend the right of redemption or may delay payment during
any period the determination of net asset value is suspended. See "HOW IS NET
ASSET VALUE CALCULATED?".

REDEMPTION BY MAIL

13
<PAGE> 38

For purposes of this policy, an "eligible guarantor institution" shall include
banks, brokers, dealers, credit unions, securities exchanges and associations,
clearing agencies and savings associations as those terms are defined in the
Securities Exchange Act of 1934. The Transfer Agent reserves the right to reject
any signature guarantee if (1) it has reason to believe that the signature is
not genuine or (2) it has reason to believe that the transaction would otherwise
be improper.

REDEMPTION BY TELEPHONE

AUTOMATIC WITHDRAWAL

SYSTEMATIC WITHDRAWAL PLAN

If you are the owner of Shares of the Fund having a total value of $25,000
or more at the current net asset value, you may elect to redeem your Shares
monthly or quarterly in amounts of $50 or more, pursuant to the Fund's
Systematic Withdrawal Plan. Please contact The Ohio Company for the appropriate
form.

WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED?

ACH PROCESSING

EXCHANGE PRIVILEGE

Cardinal Aggressive Growth Fund,
an equity fund seeking appreciation of
capital (upon the payment of the applicable sales charge);

14
<PAGE> 39

Cardinal Balanced Fund,
a fund seeking current income and
long-term growth of both capital and
income (upon the payment of the applicable sales charge);

The Cardinal Fund,
an equity fund seeking long-term growth
of capital and income (upon the payment of
the applicable sales charge);

Cardinal Government Securities Money Market Fund,
a U.S. Government securities money market fund
(without payment of any sales charge); or

Cardinal Tax Exempt Money Market Fund,
a tax-free money market fund
(without payment of any sales charge).

HOW IS NET ASSET VALUE CALCULATED?

15
<PAGE> 40

The net asset value per share will fluctuate as the value of the investment
portfolio of the Fund changes.

Portfolio securities for which over-the-counter market quotations are
readily available are valued at the bid price. The Fund uses one or more pricing
services to provide such market quotations. Securities and other assets for
which market quotations are not readily available are valued at fair value as
determined in good faith by or under the direction of the Board of Trustees of
the Group.

DOES THE FUND PAY FEDERAL INCOME TAX?

WHAT ABOUT MY TAXES?

16
<PAGE> 41

by the amount of the dividends or distributions. All or a portion of such
dividends or distributions, although in effect a return of capital, is subject
to tax.

The Transfer Agent will inform shareholders at least annually of the amount
and nature of such income and capital gains.

WHO MANAGES MY INVESTMENT IN THE FUND?

INVESTMENT ADVISER AND MANAGER

In its capacity as investment adviser, and subject to the ultimate
authority of the Group's Board of Trustees, the Adviser, in accordance with the
Fund's investment objectives and policies, manages the Fund, and makes decisions
with respect to and places orders for all purchases and sales of its portfolio
securities. Since the inception of CGOF (the Fund's predecessor), John R. Carle
has been primarily responsible for the day-to-day management of CGOF's
portfolio. It is expected that, upon consummation of the Reorganization, Mr.
Carle will be the portfolio manager for the Fund. Mr. Carle has been a portfolio
manager with the Adviser and/or The Ohio Company since 1971. In addition,
pursuant to the Investment Advisory Agreement, the Adviser generally assists in
all aspects of the Fund's administration and operation.

17
<PAGE> 42

to increase the net income of the Fund available for distribution as dividends.
The waiver of such fee will cause the yield of the Fund to be higher than it
would otherwise be in the absence of such a waiver.

DIVIDEND AND TRANSFER AGENT AND FUND ACCOUNTANT

The Group has entered into a Transfer Agency and Fund Accounting Agreement
with Cardinal Management Corp. (the "Transfer Agent"), 215 East Capital Street,
Columbus, Ohio 43215, pursuant to which the Transfer Agent has agreed to act as
the Fund's transfer agent and dividend disbursing agent. In consideration of
such services, the Fund has agreed to pay the Transfer Agent an annual fee, paid
monthly, equal to $21 per shareholder account plus out-of-pocket expenses. In
addition, the Transfer Agent provides certain fund accounting services for the
Fund. The Transfer Agent receives a fee from the Fund for such services equal to
a fee computed daily and paid periodically at an annual rate of .03% of the
Fund's average daily net assets.

DISTRIBUTOR

EXPENSES

The Adviser bears all expenses in connection with the performance of its
services as investment adviser, manager, transfer agent and fund accountant
other than the cost of securities (including brokerage commissions, if any)
purchased for the Fund. The Fund will bear the following expenses relating to
its operations: organizational expenses, taxes, interest, any brokerage fees and
commissions, fees and expenses of the Trustees of the Group, Commission fees,
state securities qualification fees, costs of preparing and printing
prospectuses for regulatory purposes and for distribution to the Fund's current
shareholders, outside auditing and legal expenses, advisory fees, fees and
out-of-pocket expenses of the custodian and Transfer Agent, costs for
independent pricing services, certain insurance premiums, costs of maintenance
of the Group's existence, costs of shareholders' reports and meetings,
distribution expenses incurred pursuant to the Distribution and Shareholder
Service Plan described below, and any extraordinary expenses incurred in the
Fund's operation.

DISTRIBUTION PLAN

Pursuant to Rule 12b-1 under the 1940 Act, the Group has adopted a
Distribution and Shareholder Service Plan (the "Plan"), under which the Fund is
authorized to pay The Ohio Company, as the Fund's principal underwriter, a
periodic amount calculated at an annual rate not to exceed twenty-five
one-hundredths of one percent (.25%) of the average daily net asset value of the
Fund. Such amount may be used by The Ohio Company to pay broker-dealers
(including The Ohio Company), banks and other institutions (a "Participating
Organization") for distribution and/or shareholder service assistance pursuant
to an agreement between The Ohio Company and the Participating Organization or
for distribution assistance and/or shareholder service provided by The Ohio
Company pursuant to an agreement between The Ohio Company and the Group. Under
the Plan, a Participating Organization may include The Ohio Company, its
subsidiaries, and its affiliates. The Ohio Company may from time to time waive
all or a portion of the fees payable to it pursuant to the Plan. Any such waiver
will cause the total return and yield of the Fund to be higher than it would
otherwise be absent such a waiver.

18
<PAGE> 43

In addition, The Ohio Company may enter into, from time to time, other Rule
12b-1 Agreements with selected dealers pursuant to which such dealers will
provide certain Shareholder services such as those described above.

CUSTODIAN

WHAT ARE MY RIGHTS AS A SHAREHOLDER?

The Group was organized as an Ohio business trust on March 23, 1993. The
Group currently consists of six funds, each having its own class of shares. The
other funds of the Group are Cardinal Balanced Fund, Cardinal Aggressive Growth
Fund, The Cardinal Fund, Cardinal Government Securities Money Market Fund and
Cardinal Tax Exempt Money Market Fund. Each share represents an equal
proportional interest in a fund with other shares of the same fund, and is
entitled to such dividends and distributions out of the income earned on the
assets belonging to that fund as are declared at the discretion of the Trustees.

To the extent that such a meeting is not required, the Group does not
intend to have an annual or special meeting.

19
<PAGE> 44

Shareholders should direct all inquiries concerning such matters to the
Transfer Agent in writing to 215 East Capital Street, Columbus, Ohio 43215, or
by calling (800) 282-9446.

Shareholders will receive unaudited semi-annual reports describing the
investment operations of the Fund and annual financial reports audited by
independent auditors.

20
<PAGE> 45

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<PAGE> 46

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<PAGE> 47

Investment Adviser and Manager
Cardinal Management Corp.
155 East Broad Street
Columbus, Ohio 43215

Distributor
The Ohio Company
155 East Broad Street
Columbus, Ohio 43215

Transfer Agent and Dividend Paying Agent
Cardinal Management Corp.
215 East Capital Street
Columbus, Ohio 43215

Custodian
The Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263

Legal Counsel
Baker & Hostetler
65 East State Street
Columbus, Ohio 43215

Independent Auditors
KPMG Peat Marwick LLP
Two Nationwide Plaza
Columbus, Ohio 43215
<PAGE> 48

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TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS HIGHLIGHTS.................. 2
FEE TABLE.............................. 3
PERFORMANCE INFORMATION................ 4
WHAT IS THE FUND?...................... 4
WHAT ARE THE INVESTMENT OBJECTIVES AND
POLICIES OF THE FUND?................ 5
HOW DO I PURCHASE SHARES OF THE
FUND?................................ 10
MAY MY TAX SHELTERED RETIREMENT PLAN
INVEST IN THE FUND?.................. 11
HOW MAY I QUALIFY FOR QUANTITY
DISCOUNTS?........................... 11
WHAT DISTRIBUTIONS WILL I RECEIVE?..... 13
HOW MAY I REDEEM MY SHARES?............ 13
WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED?............................ 14
HOW IS NET ASSET VALUE CALCULATED?..... 15
DOES THE FUND PAY FEDERAL INCOME
TAX?................................. 16
WHAT ABOUT MY TAXES?................... 16
WHO MANAGES MY INVESTMENT IN THE
FUND?................................ 17
WHAT ARE MY RIGHTS AS A SHAREHOLDER?... 19
</TABLE>

------------------------

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The Ohio Company

CARDINAL
GOVERNMENT
OBLIGATIONS FUND
------------------------

PROSPECTUS

------------------------

JANUARY 10, 1996

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- ------------------------------------------------------
<PAGE> 49

PROSPECTUS Rule 497(c) File No. 811-7588

CARDINAL GOVERNMENT SECURITIES MONEY MARKET FUND

Cardinal Government Securities Money Market Fund (the "Fund") is a
diversified investment fund of The Cardinal Group (the "Group"), an open-end,
management investment company. The Trustees of the Group have divided the Fund's
beneficial ownership into an unlimited number of transferable units called
shares (the "Shares").

The Fund's investment objectives are maximizing current income while
preserving capital and maintaining liquidity. The Fund seeks to attain its
objectives by investing as fully as possible, but in no event less than 80% of
its total assets, in U.S. Treasury bills, notes and bonds, other obligations
issued or guaranteed by the United States, its agencies or instrumentalities,
and repurchase agreements relating to such obligations. All obligations
purchased by the Fund will mature, or be deemed to mature, in thirteen months or
less. There can be no assurance that the Fund's objectives will be achieved.

The Fund is designed for investors who desire current income that reflects
prevailing interest rates for short-term investments together with a high degree
of liquidity.

THE SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY ANY BANK, NOR ARE SUCH SHARES FEDERALLY INSURED OR GUARANTEED BY THE
UNITED STATES GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER GOVERNMENTAL AGENCY. AN INVESTMENT IN THE FUND
INVOLVES CERTAIN INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. THE
FUND INTENDS TO MAINTAIN A CONSTANT NET ASSET VALUE OF $1.00 PER SHARE, BUT
THERE CAN BE NO ASSURANCE THAT NET ASSET VALUE WILL NOT VARY.

- --------------------------------------------------------------------------------

FOR FURTHER INFORMATION REGARDING THE FUND OR FOR ASSISTANCE IN OPENING AN
ACCOUNT OR REDEEMING SHARES, PLEASE CALL (800) 282-9446 TOLL FREE.

INQUIRIES MAY ALSO BE MADE BY MAIL ADDRESSED TO THE FUND AT ITS PRINCIPAL
OFFICE:

155 EAST BROAD STREET
COLUMBUS, OHIO 43215
- --------------------------------------------------------------------------------

The Prospectus relates only to Cardinal Government Securities Money Market
Fund, currently one of six funds of the Group. Interested persons who wish to
obtain prospectuses of Cardinal Balanced Fund, Cardinal Aggressive Growth Fund,
The Cardinal Fund, Cardinal Government Obligations Fund or Cardinal Tax Exempt
Money Market Fund should contact The Ohio Company at the number above.
Additional information about the Fund, contained in a Statement Of Additional
Information dated January 10, 1996, has been filed with the Securities and
Exchange Commission and is incorporated herein by reference. Such Statement is
available upon request without charge from the Fund at the above address or by
calling the phone number provided above.

This Prospectus sets forth concisely the information about the Fund that a
prospective investor ought to know before investing in the Fund. This Prospectus
should be retained for future reference.

The Ohio Company

The date of this Prospectus is January 10, 1996.

<PAGE> 50

PROSPECTUS HIGHLIGHTS

INVESTMENT OBJECTIVES......... The Fund seeks to maximize current income while
maintaining liquidity and preserving capital.
(See page 3.)

INVESTMENT POLICIES........... The Fund invests as fully as possible, but in
no event less than 80% of its total assets, in
short-term obligations issued or guaranteed by
the U.S. Government and its agencies and
instrumentalities, and repurchase agreements
secured by such obligations. (See pages 3 and
4.)

CURRENT INCOME................ Dividends are generally credited daily and paid
monthly. Such distributions are automatically
reinvested in additional Shares of the Fund
without charge. Dividends may also be received
in cash. (See pages 8 and 9.)

LIQUIDITY..................... Through the free check-writing privilege or
telephone transfer, Shares may be redeemed on
any Business Day at the net asset value without
charge. (See page 11.)

PURCHASES..................... There is a minimum initial investment of $1,000
with subsequent minimums of $100. Such minimums
may be waived under certain circumstances. (See
page 6.)

INVESTMENT ADVISER............ Cardinal Management Corp. (the "Adviser"), a
wholly-owned subsidiary of The Ohio Company, is
the Fund's investment adviser. The Adviser also
serves as investment adviser for The Cardinal
Fund, Cardinal Government Obligations Fund,
Cardinal Tax Exempt Money Market Fund, Cardinal
Balanced Fund and Cardinal Aggressive Growth
Fund (collectively, with the Fund, the
"Cardinal Funds"). (See page 14.)

FEE TABLE

<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of offering price).......... 0%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees...................................................................... .50%
12b-1 Fees........................................................................... 0
Other Expenses(1).................................................................... .29
---
Total Fund Operating Expenses................................................ .79%
===
</TABLE>

EXAMPLE

1 YEAR 3 YEARS
------ -------
<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: $8 $25
</TABLE>

- ---------------
(1) "Other Expenses" are based upon estimated amounts for the current fiscal
year.

2
<PAGE> 51

PERFORMANCE INFORMATION

From time to time the Fund may advertise its "yield" or "annualized yield"
and its "effective yield". BOTH YIELD FIGURES ARE BASED ON HISTORICAL EARNINGS
AND ARE NOT INTENDED TO INDICATE FUTURE PERFORMANCE. The "yield" or "annualized
yield" of the Fund refers to the income generated by an investment in the Fund
over a seven-day period (which period will be stated in the advertisement). This
income is then "annualized." That is, the amount of income generated by the
investment during that week is assumed to be generated each week over a 52-week
period and is shown as a percentage of the investment. The "effective yield" is
calculated similarly but, when annualized, the income earned by an investment in
the Fund is assumed to be reinvested. The "effective yield" will be slightly
higher than the "yield" or "annualized yield" because of the compounding effect
of this assumed reinvestment.

Investors may also judge the performance of the Fund by comparing or
referencing its performance to the performance of other mutual funds or mutual
fund portfolios with comparable investment objectives and policies through
various mutual fund or market indices such as those prepared by Dow Jones & Co.,
Inc. and Standard & Poor's Corporation and to data prepared by Lipper Analytical
Services, Inc., Morningstar, Inc. and CDA Investment Technologies, Inc.
Comparisons may also be made to indices or data published in Donoghue's MONEY
FUND REPORT of Holliston, Massachusetts, a nationally recognized money market
fund reporting service, Money Magazine, Forbes, Barron's, The Wall Street
Journal, The New York Times, The Columbus Dispatch, Business Week, Consumer
Reports and U.S.A. Today. In addition to performance information, general
information about the Fund that appears in a publication such as those mentioned
above may be included in advertisements and in reports to shareholders.

WHAT IS THE FUND?

The Fund is one separate diversified investment fund of the Group, which
was organized on March 23, 1993, as an Ohio business trust. The Group is
registered and operates as an open-end management investment company as defined
in the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund has
been organized for the purpose of acquiring all of the assets and liabilities of
Cardinal Government Securities Trust ("CGST") to effect a reorganization of CGST
from a stand alone investment company to a series of the Group (the
"Reorganization").

WHAT ARE THE INVESTMENT OBJECTIVES
AND POLICIES OF THE FUND?

IN GENERAL

The investment objectives of the Fund are to maximize current income while
preserving capital and maintaining liquidity. The investment objectives with
respect to the Fund are a fundamental policy and as such may not be changed
without a vote of the holders of a majority of the outstanding Shares of the
Fund (as defined below under "WHAT ARE MY RIGHTS AS A SHAREHOLDER?"). There can
be no assurance that the objectives of the Fund will be achieved.

The Fund seeks to attain its investment objectives by investing as fully as
possible, but in no event less than 80% of its total assets, in U.S. Treasury
bills, notes and bonds, other obligations issued or guaranteed by the United
States, its agencies or instrumentalities and repurchase agreements relating to
such obligations. The Fund will purchase only obligations which have, or are
deemed to have, maturities, from the date of purchase, of thirteen months or
less. Current income earned on such securities may not be as great as current
income that could be earned on lower quality securities that have less liquidity
and/or a greater risk of non-payment or securities that have a longer term.

3
<PAGE> 52

Notwithstanding any of the foregoing, the Fund, as a money market fund
subject to Rule 2a-7 of the 1940 Act, must invest exclusively in United States
dollar-denominated instruments which the Trustees of the Group and the Adviser
determine present minimal credit risks and which at the time of acquisition are
rated by one or more appropriate nationally recognized statistical rating
organizations ("NRSROs") (e.g. Standard & Poor's Corporation and Moody's
Investors Service, Inc.) in one of the two highest rating categories for
short-term debt obligations or, if unrated, are of comparable quality. In
addition, the dollar-weighted average maturity of the obligations in the Fund
may not exceed 90 days.

Subject to the foregoing limitations and in order to achieve its investment
objectives, the Fund expects to invest in the following types of securities.

Direct obligations issued by the U.S. Treasury include bills, notes and
bonds which differ from each other only in interest rates, maturities and times
of issuance: Treasury bills have maturities of one year or less; Treasury notes
have maturities of one to ten years and Treasury bonds generally have maturities
of greater than ten years.

Examples of obligations issued by agencies or instrumentalities of the U.S.
Government include, among others, securities issued by the General Services
Administration, Federal Housing Administration, Farmers Home Administration,
Government National Mortgage Association, Federal Home Loan Banks, Federal
Intermediate Credit Banks, Federal Land Banks, Federal Home Loan Mortgage
Corporation, Central Bank for Cooperatives, Maritime Administration, The
Tennessee Valley Authority, Washington, D.C. Armory Board, Export-Import Bank of
the United States, the International Bank for Reconstruction and Development,
Federal National Mortgage Association and Student Loan Marketing Association.

Certain of such U.S. Government obligations may have variable or floating
rates of interest. The Fund intends to invest in variable and floating rate
instruments whose market value, upon reset of the interest rate, will
approximate par value because their interest rates will be tied to short-term
market rates. Some obligations issued or guaranteed by U.S. Government agencies
or instrumentalities are supported by the full faith and credit of the U.S.
Treasury; others by U.S. Treasury guarantees; and others, such as those issued
by Federal Home Loan Banks, by the right of the issuer to borrow from the
Treasury. In addition, some obligations of U.S. Government agencies or
instrumentalities, such as those issued by the Federal National Mortgage
Association, are supported by the discretionary authority of the U.S. Government
to purchase certain obligations of the agency or instrumentality, and others,
such as those issued by the Student Loan Marketing Association, are supported
solely by the credit of the issuing agency or instrumentality itself. No
assurance can be given that the U.S. Government will provide financial support
to such U.S. Government sponsored agencies or instrumentalities in the future,
since it is not obligated to do so by law. The Fund will invest in such
securities only when it is satisfied that the credit risk with respect to the
issuer is minimal.

RISK FACTORS AND INVESTMENT TECHNIQUES

4
<PAGE> 53

(iii) payment for the underlying securities is made only upon physical delivery
or evidence of book-entry transfer to the account of the Fund's custodian or a
bank acting as agent. The Adviser will be responsible for continuously
monitoring such requirements.

INVESTMENT COMPANY SECURITIES. The Fund may also invest up to 10% of the
value of its total assets in the securities of other investment companies
subject to the limitations set forth in the 1940 Act. The Fund intends to invest
in the securities of other money market mutual funds for purposes of short-term
cash management. The Fund's investment in such other investment companies may
result in the duplication of fees and expenses, particularly investment advisory
fees. For a further discussion of the limitations on the Fund's investments in
other investment companies, see "INVESTMENT OBJECTIVES AND POLICIES --
Additional Information on Portfolio Instruments -- Securities of Other
Investment Companies" in the Fund's Statement of Additional Information.

INVESTMENT RESTRICTIONS

The Fund will not:

5
<PAGE> 54

considered to be in the industries of their parents if their activities are
primarily related to financing the activities of their parents; and (c)
utilities will be divided according to their services. For example, gas,
gas transmission, electric and gas, electric, and telephone will each be
considered a separate industry.

3. Borrow money or issue senior securities, except that the Fund may
borrow from banks or enter into reverse repurchase agreements or dollar
roll agreements for temporary purposes in amounts up to 10% of the value of
the Fund's total assets at the time of such borrowing and except as
permitted pursuant to an exemption from the 1940 Act. The Fund will not
purchase securities while its borrowings (including reverse repurchase
agreements and dollar roll agreements) exceed 5% of its total assets.

4. Make loans, other than by entering into repurchase agreements to
the extent allowed herein and through the purchase of other obligations in
accordance with its investment objective and policies.

The following additional investment restriction may be changed without the
vote of a majority of the outstanding Shares of the Fund.

The Fund may not:

1. Purchase otherwise acquire any securities, if as a result, more
than 10% of the Fund's net assets would be invested in securities that are
illiquid.

HOW DO I PURCHASE SHARES OF THE FUND?

GENERAL

Shares of the Fund are sold on a continuing basis without a sales charge at
the net asset value next determined after an order is received by The Ohio
Company, 155 East Broad Street, Columbus, Ohio 43215, the Fund's principal
underwriter, and federal funds (monies credited to a member bank's account in a
Federal Reserve Bank) are received by The Ohio Company as hereinafter provided.
The minimum initial investment for individuals is $1,000 and subsequent
investments must be in amounts of at least $100. The Fund may, at its
discretion, waive the subsequent investment minimum for purchases effected
through the automatic reinvestment of distributions from unit investment trusts
sponsored by The Ohio Company, and may waive both the initial and subsequent
investment minimums for purchases effected with cash balances in brokerage
accounts of customers of The Ohio Company. Institutions may place orders for any
number of individual accounts with a minimum initial purchase of $1,000 for each
individual account. Subsequent purchases may be made in minimum amounts of $100
for each individual account. Shares of the Fund may be purchased through a
securities dealer, investment adviser, agent or other fiduciary which may charge
a fee for its services in connection with the purchase. No sales charge is
imposed by the Group or by The Ohio Company.

Subsequent purchases of Shares of the Fund may be made by ACH processing as
described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED? -- ACH
Processing" below. In addition, if an Account Information Form has previously
been received by The Ohio Company, Shares may also be purchased by wiring funds
to the Fund's custodian, as described below under "Purchase by Federal Funds
Wire."

6
<PAGE> 55

("Business Day"). If a properly completed order and federal funds (or other
immediately available funds) are received at or prior to 12:00 noon Eastern Time
on a Business Day, then the purchase will be entered as of 4:00 p.m. Eastern
Time on that day and dividends will commence on that day. If either federal
funds (or other immediately available funds) or the completed purchase order are
received after 12:00 noon Eastern Time (but prior to 4:00 p.m. Eastern Time)
Shares will be credited to the shareholder's account as of 4:00 p.m. Eastern
Time on that day but will not earn dividends until the following day.

The Group reserves the right to reject any order for the purchase of Shares
in whole or in part. You will receive a confirmation of each new transaction in
your account, which will also show the total number of Shares owned by you and
the number of Shares being held in safekeeping by Cardinal Management Corp., the
Fund's transfer agent (the "Transfer Agent"), for your account. Certificates
representing Shares will not be issued.

PURCHASE BY FEDERAL FUNDS WIRE

Investments in Shares of the Fund may be made by wire transfer of federal
funds, avoiding delays of the mail and the normal check clearance process
described below. An investor may telephone the Fund (800) 282-9446, toll free,
prior to wire transfer of its investment to advise the Group of the investment
and, if a new investor, to obtain an account number. If an investor does not
telephone the Group for wire instructions and the investor's wire transfer does
not include sufficient information, such purchase will be delayed until the
proper information is received. An investor must instruct its bank to "wire
transfer" the investment immediately to:

The Huntington National Bank
Account Number 01891688407
Routing Number 044000024
17 South High Street
Columbus, Ohio 43215
Attn: Cardinal Government Securities Fund
[Include Fund Account Number and Name of Account Holder]

Funds transmitted by wire will be invested in Shares of the Fund at the net
asset value next computed after receipt thereof as described above under
"General." A bank may charge for its services in effecting wire transfers of
funds.

7
<PAGE> 56

PURCHASE BY MAIL

Investment in Shares of the Fund may be made by mail by sending a check or
other negotiable bank draft payable to the order of "Cardinal Government
Securities Money Market Fund" together with, in the case of an initial purchase,
an Application Form to:

Cardinal Government Securities Money Market Fund
155 East Broad Street
Columbus, Ohio 43215

Money transmitted by check drawn on a member of the Federal Reserve System
will normally be converted to federal funds and invested in Shares of the Fund
within one Business Day following receipt by The Ohio Company. Checks drawn on
non-member banks may take considerably longer. The Transfer Agent or the Group
will attempt to notify the investor upon receipt of the latter type of check as
to the possible delay and to arrange for a better means of transmittal of funds.
THE GROUP STRONGLY RECOMMENDS THAT INVESTORS OF SUBSTANTIAL AMOUNTS USE FEDERAL
FUNDS TO PURCHASE SHARES.

AUTOMATIC INVESTMENT PLAN

MAY MY TAX SHELTERED RETIREMENT
PLAN INVEST IN THE FUND?

Shares of the Fund qualify for purchase in connection with the following
tax sheltered retirement plans:

-- Individual retirement account ("IRAs") plans

-- Simplified Employee Pension Plans

-- 403(b)(7) Custodial Plans sponsored by certain tax-exempt employers

-- Pension, profit-sharing and 401(k) plans qualifying under Section 401(a)
of the Internal Revenue Code

WHAT DISTRIBUTIONS WILL I RECEIVE?

The Fund's net income is declared as a dividend and accrued on each
Business Day immediately prior to the determination of the Fund's net asset
value at 4:00 p.m. Eastern Time. Net investment income (from the time of the
immediately preceding declaration) consists of interest accrued on the portfolio
of the Fund (including accrued discount earned and premium amortized), plus
realized net short-term capital gains (losses) due to portfolio transactions (if
any), less the accrued expenses of the Fund applicable to that dividend period.
The Fund does not expect to realize any long-term capital gains due to its
policy of investing in securities maturing in 13 months or less.

8
<PAGE> 57

on their Shares in cash by checking the appropriate box on the Account
Information Form or by otherwise notifying the Transfer Agent in writing. In
addition, investors may obtain cash at any time without charge by redeeming
Shares at net asset value. If the entire account of a shareholder is withdrawn,
all dividends accrued to the time of withdrawal will be paid at that time.

Shareholders may also elect to receive dividends and distributions in cash
by using ACH processing as described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED? -- ACH Processing" below.

Should the Fund incur or anticipate any extraordinary expense, loss or
depreciation which would adversely affect its net asset value per share or
income for a particular period, the Trustees would at that time consider whether
to adhere to the present dividend policy described above or to revise it in
light of the then-prevailing circumstances. For example, if the Fund's net asset
value per share were reduced, or expected to be reduced, below $1.00, the
Trustees might suspend further dividend accruals until the net asset value
returned to $1.00. Thus, extraordinary expenses, losses or depreciation may
result in no dividends being accrued for the period during which an investor
holds Shares as well as a redemption price lower than the purchase price for
such Shares.

HOW MAY I REDEEM MY SHARES?

Investors may redeem Shares of the Fund on any Business Day at the net
asset value per share next determined following receipt by the Transfer Agent,
215 East Capital Street, Columbus, Ohio 43215, of a written or telephonic notice
to redeem, or by check, each as more fully described below. See "HOW IS NET
ASSET VALUE CALCULATED?" below, for a description of when net asset value is
determined.

Proceeds of redemption requests received by the Transfer Agent in proper
form before (1) 4:00 p.m. Eastern Time for shareholders who are customers of The
Ohio Company and who have submitted their redemption request through their
broker at The Ohio Company or (2) 12:00 noon Eastern Time for all other
redemption requests, will be sent by mail on the next Business Day or, if the
expedited redemption option is available, by federal funds wire on the next
Business Day for use on that day.

The Group reserves the right to delay payment for the redemption of Shares
where such Shares were purchased with other than immediately available funds,
but only until the purchase payment has cleared (which may take fifteen or more
days from the date the purchase payment is received by the Fund). The purchase
of Fund Shares by wire transfer of federal funds would avoid any such delay.

The Group may suspend the right of redemption or may delay payment during
any period the determination of net asset value is suspended. See "HOW IS NET
ASSET VALUE CALCULATED?".

Due to the high cost of maintaining accounts, the Group reserves the right
to redeem involuntarily Shares in any account at the then current net asset
value if at any time redemptions have reduced a shareholder's total investment
in the Fund to a net asset value below $500. A shareholder will be notified in
writing that the value of Fund Shares in the account is less than $500 and
allowed not less than 30 days to increase his investment in the Fund to $500
before the redemption is processed. Proceeds of redemptions so processed,
including dividends declared to the date of redemption, will be promptly paid to
the shareholder.

9
<PAGE> 58

REDEMPTION BY MAIL

REDEMPTION BY TELEPHONE

EXPEDITED REDEMPTION

Any investor may elect to use the expedited redemption procedure by
designating on the Account Information Form submitted at the time of initial
investment the name of a commercial bank and account number to receive proceeds
of redemption. If this election is made, requests for redemption may be made by
mail or by telephone as described above.

An investor may elect to have redemption proceeds sent by federal funds
wire to the designated U.S. bank account if the proceeds are $1,000 or more.
Otherwise, proceeds will be sent by mail. No signature guarantee will be
required of investors electing this procedure. Requests to change bank or
account designations may only be made in writing to the Fund with the type of
signature guarantee and other documentation specified under "Redemption by Mail"
above. To participate in this procedure, an investor must complete the expedited
redemption portion of the Account Information Form or notify the Fund at any
time after making an initial investment.

An investor may also elect to have redemption proceeds sent by federal
funds wire to The Ohio Company, the Fund's distributor, if the proceeds are $500
or more. If the investor elects to have federal funds so wired, the investor may
pick up a check at The Ohio Company's main office at 155 East Broad Street,
Columbus, Ohio or The Ohio Company will mail a check to the investor's address
of record. The Fund may, at its discretion, waive the minimum redemption
requirement for redemptions effected to cover debit balances in brokerage
accounts of customers of The Ohio Company.

10
<PAGE> 59

AUTOMATIC WITHDRAWAL

SYSTEMATIC WITHDRAWAL PLAN

As a shareholder, you may elect to redeem your Shares monthly or quarterly
in amounts of $50 or more, pursuant to the Fund's Systematic Withdrawal Plan.
Please contact The Ohio Company for the appropriate form.

CHECK-WRITING REDEMPTION PROCEDURE

The Transfer Agent will provide any shareholder who so requests with a
supply of checks, imprinted with the shareholder's name, which may be drawn
against the Fund's account maintained by The Fifth Third Bank (the "Bank"), for
redemption of Fund Shares. These checks may be made payable to the order of any
person in any amount not less than $250. To participate in this procedure, an
investor must complete the Check-Writing Redemption Form available from the
Transfer Agent. When a check is presented to the Bank for payment, the Transfer
Agent (as your agent) will cause the Fund to redeem sufficient Shares in your
account to cover the amount of the check. Shares continue earning daily
dividends until the day on which the check is presented to the Bank for payment.
Cancelled checks will be returned to you. Due to the delay caused by the
requirement that redemptions be priced at the next computed net asset value, the
Bank will only accept for payment checks presented through normal bank clearing
channels. Shareholders should not attempt to withdraw the full amount of an
account or to close out an account by using this procedure.

No charge will be made to a shareholder for participation in the
check-writing redemption procedure or for the clearance of any checks. However,
charges for copies ($5 each), returned checks ($15 each) and returned items of
deposit ($15 each) will be deducted from a shareholder's account.

In order to stop payment on a check, the shareholder must notify the Fund
in writing before the check has been presented to the Bank for payment. A charge
of $15 will be deducted from the shareholder's account for each stop payment
order.

WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED?

ACH PROCESSING

11
<PAGE> 60

EXCHANGE PRIVILEGE

Cardinal Aggressive Growth Fund,
an equity fund seeking appreciation of
capital (upon the payment of the applicable sales charge);

Cardinal Balanced Fund,
a fund seeking current income and
long-term growth of both capital and
income (upon the payment of the applicable sales charge);

The Cardinal Fund,
an equity fund seeking long-term growth of capital and
income (upon the payment of the applicable sales charge);

Cardinal Government Obligations Fund,
a fund investing in securities issued
or guaranteed by the U.S. Government
(upon the payment of the applicable sales charge); or

Cardinal Tax Exempt Money Market Fund,
a tax-free money market fund
(without payment of any sales charge).

Notwithstanding the foregoing and subject to the limitations contained in
the following paragraph, exchanges of Fund Shares for shares of The Cardinal
Fund, Cardinal Government Obligations Fund, Cardinal Balanced Fund or Cardinal
Aggressive Growth Fund (individually, a "Cardinal Load Fund") generally may be
completed upon the payment of a sales charge equal to the sales charge payable
upon purchase of shares of that Cardinal Load Fund. If, however, the Shares of
Fund to be exchanged were acquired as a result of an exchange of shares of the
Cardinal Load Fund, the sales charge to be paid on the present exchange may be
reduced by the sales charge previously paid.

For tax purposes, an exchange is treated as a redemption and a new
purchase.

12
<PAGE> 61

HOW IS NET ASSET VALUE CALCULATED?

The Fund's net asset value per share is currently determined as of 4:00
p.m. Eastern Time on each Business Day. Net asset value per share is computed by
dividing the total value of the assets of the Fund, less its liabilities, by the
total number of Shares outstanding. Expenses and fees of the Fund, including the
management fee, are accrued daily and taken into account for the purpose of
determining the net asset value.

The Board of Trustees has adopted a policy requiring the Fund to use its
best efforts, under normal circumstances, to maintain a constant net asset value
of $1.00 per share. The Fund values its portfolio securities by the amortized
cost method which involves valuing a security at its cost and thereafter
accruing any discount or premium at a constant rate to maturity. The Fund will
normally include any accrued discount or premium in its daily dividend and will
thereby keep constant the value of the Fund's assets and, consequently, its net
asset value per share. This method does not take into account unrealized capital
gains or losses or the effect of fluctuating interest rates.

DOES THE FUND PAY FEDERAL INCOME TAX?

Each of the funds of the Group, including the Fund, is treated as a
separate entity for federal income tax purposes and intends to qualify as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended (the "Code"), for so long as such qualification is in the best interest
of that fund's shareholders. Qualification as a regulated investment company
under the Code requires, among other things, that the regulated investment
company distribute to its shareholders at least 90% of its investment company
taxable income. The Fund contemplates declaring as dividends 100% of the Fund's
investment company taxable income (before deduction of dividends paid).

WHAT ABOUT MY TAXES?

It is expected that the Fund will distribute annually to shareholders all
or substantially all of the Fund's net ordinary income and net realized capital
gains and that such distributed net ordinary income and distributed net realized
capital gains will be taxable income to shareholders for federal income tax
purposes, even if paid in additional Shares of the Fund and not in cash. Since
all of the Fund's net investment income is expected to be derived from earned
interest and short-term capital gains, it is anticipated that no part of any
distribution will be eligible for the dividends received deduction for
corporations. The Fund does not expect to realize any long-term capital gains
and, therefore, does not foresee paying any "capital gains dividends" as
described in the Code. However, if the Fund were to realize any long-term
capital gains, distribution by the Fund of the excess of any such net long-term
capital gain over net short-term capital loss is taxable to shareholders as
long-term capital gain in the year in which it is received, regardless of how
long the shareholder has held the Shares. Such distributions are not eligible
for the dividends-received deduction.

Even though a substantial portion of distributions of net income will be
attributable to interest on U.S. Government obligations, which may be exempt
from state or local tax if received directly by a shareholder, shareholders of
the Fund may be subject to state and local taxes with respect to their ownership
of Fund Shares or distributions from the Fund.

13
<PAGE> 62

The Transfer Agent will inform shareholders at least annually of the amount
and nature of such income and capital gains.

WHO MANAGES MY INVESTMENT IN THE FUND?

INVESTMENT ADVISER AND MANAGER

In its capacity as investment adviser, and subject to the ultimate
authority of the Group's Board of Trustees, the Adviser, in accordance with the
Fund's investment objectives and policies, manages the Fund, and makes decisions
with respect to and places orders for all purchases and sales of its portfolio
securities. Since December 22, 1995, John R. Carle has been primarily
responsible for the day-to-day management of the portfolio of CGST (the Fund's
predecessor). It is expected that upon consummation of the Reorganization Mr.
Carle will be the portfolio manager for the Fund. Mr. Carle has been a portfolio
manager with the Adviser and/or The Ohio Company since 1971 and has more than 28
years of management experience. In addition, pursuant to the Investment Advisory
Agreement, the Adviser generally assists in all aspects of the Fund's
administration and operation.

For the services provided and expenses assumed pursuant to its investment
advisory agreement with the Group with respect to the Fund, the Adviser receives
a fee from the Fund, computed daily and paid monthly at the annual rate of .50%
of average net daily assets of the Fund. The Adviser may periodically waive all
or a portion of its advisory fee with respect to the Fund to increase the net
income of the Fund available for distributions as dividends. The waiver of such
fee will cause the yield of the Fund to be higher than it would otherwise be in
the absence of such waiver.

14
<PAGE> 63

DIVIDEND AND TRANSFER AGENT AND FUND ACCOUNTANT

The Group has entered into a Transfer Agency and Fund Accounting Agreement
with Cardinal Management Corp. (the "Transfer Agent"), 215 East Capital Street,
Columbus, Ohio 43215, pursuant to which the Transfer Agent has agreed to act as
the Fund's transfer agent and dividend disbursing agent. In consideration of
such services, the Fund has agreed to pay the Transfer Agent an annual fee, paid
monthly, equal to $21 per shareholder account plus out-of-pocket expenses. In
addition, the Transfer Agent provides certain fund accounting services for the
Fund. The Transfer Agent receives a fee from the Fund for such services equal to
a fee computed daily and paid periodically at an annual rate of .03% of the
Fund's average daily net assets.

DISTRIBUTOR

EXPENSES

The Adviser bears all expenses in connection with the performance of its
services as investment adviser, manager, transfer agent and fund accountant
other than the cost of securities (including brokerage commissions, if any)
purchased for the Fund. The Fund will bear the following expenses relating to
its operations: organizational expenses, taxes, interest, any brokerage fees and
commissions, fees and expenses of the Trustees of the Group, Commission fees,
state securities qualification fees, costs of preparing and printing
prospectuses for regulatory purposes and for distribution to the Fund's current
shareholders, outside auditing and legal expenses, advisory fees, fees and
out-of-pocket expenses of the custodian and Transfer Agent, costs for
independent pricing services, certain insurance premiums, costs of maintenance
of the Group's existence, costs of shareholders' reports and meetings, and any
extraordinary expenses incurred in the Fund's operation.

CUSTODIAN

WHAT ARE MY RIGHTS AS A SHAREHOLDER?

The Group was organized as an Ohio business trust on March 23, 1993. The
Group currently consists of six funds, each having its own class of shares. The
other funds of the Group are The Cardinal Fund, Cardinal Government Obligations
Fund, Cardinal Tax Exempt Money Market Fund, Cardinal Balanced Fund and Cardinal
Aggressive Growth Fund. Each share represents an equal proportional interest in
a fund with other shares of the same fund, and is entitled to such dividends and
distributions out of the income earned on the assets belonging to that fund as
are declared at the discretion of the Trustees.

15
<PAGE> 64

as a fund, and not in the aggregate with other shareholders of the Group, for
purposes of approval of amendments to the Fund's investment advisory agreement
or any of the Fund's fundamental policies.

Shareholders should direct all inquiries concerning such matters to the
Transfer Agent in writing to 215 East Capital Street, Columbus, Ohio 43215, or
by calling (800) 282-9446.

Shareholders will receive unaudited semi-annual reports describing the
investment operations of the Fund and annual financial reports audited by
independent auditors.

16
<PAGE> 65

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 66

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 67

Investment Adviser and Manager
Cardinal Management Corp.
155 East Broad Street
Columbus, Ohio 43215

Distributor
The Ohio Company
155 East Broad Street
Columbus, Ohio 43215

Transfer Agent and Dividend Paying Agent
Cardinal Management Corp.
215 East Capital Street
Columbus, Ohio 43215

Custodian
The Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263

Legal Counsel
Baker & Hostetler
65 East State Street
Columbus, Ohio 43215

Independent Auditors
KPMG Peat Marwick LLP
Two Nationwide Plaza
Columbus, Ohio 43215
<PAGE> 68

- ------------------------------------------------------
- ------------------------------------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS HIGHLIGHTS................. 2
FEE TABLE............................. 2
PERFORMANCE INFORMATION............... 3
WHAT IS THE FUND?..................... 3
WHAT ARE THE INVESTMENT OBJECTIVES AND
POLICIES OF THE FUND?............... 3
HOW DO I PURCHASE SHARES OF THE
FUND?............................... 6
MAY MY TAX SHELTERED RETIREMENT PLAN
INVEST IN THE FUND?................. 8
WHAT DISTRIBUTIONS WILL I RECEIVE?.... 8
HOW MAY I REDEEM MY SHARES?........... 9
WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED?........................... 11
HOW IS NET ASSET VALUE CALCULATED?.... 13
DOES THE FUND PAY FEDERAL INCOME
TAX?................................ 13
WHAT ABOUT MY TAXES?.................. 13
WHO MANAGES MY INVESTMENT IN THE
FUND?............................... 14
WHAT ARE MY RIGHTS AS A
SHAREHOLDER?........................ 15
</TABLE>

------------------------

- ------------------------------------------------------
- ------------------------------------------------------

The Ohio Company

CARDINAL
GOVERNMENT SECURITIES
MONEY MARKET FUND
------------------------

PROSPECTUS

------------------------

JANUARY 10, 1996

- ------------------------------------------------------
- ------------------------------------------------------
<PAGE> 69

PROSPECTUS Rule 497(c) File No. 811-7588

CARDINAL TAX EXEMPT MONEY MARKET FUND

Cardinal Tax Exempt Money Market Fund (the "Fund") is a diversified
investment fund of The Cardinal Group (the "Group"), an open-end, management
investment company. The Trustees of the Group have divided the Fund's beneficial
ownership into an unlimited number of transferable units called shares (the
"Shares").

The Fund's investment objectives are maximizing current income exempt from
federal income tax while preserving capital and maintaining liquidity. The Fund
seeks to attain its objective through professional management of a high-grade
portfolio of short-term municipal bonds and notes, tax-exempt commercial paper
and tax-exempt short-term discount notes. All obligations purchased by the Fund
will mature, or be deemed to mature, in 397 days (13 months) or less or will
have interest rates adjusted in accordance with established indexes (e.g., the
prime rate) not less frequently than semi-annually. There can be no assurance
that the Fund's objectives will be achieved.

The Fund is designed for investors who desire current income exempt from
federal income tax that reflects prevailing interest rates for short-term
tax-exempt investments together with a high degree of liquidity.

- --------------------------------------------------------------------------------

FOR FURTHER INFORMATION REGARDING THE FUND OR FOR ASSISTANCE IN OPENING AN
ACCOUNT OR REDEEMING SHARES, PLEASE CALL (800) 282-9446 TOLL FREE.

INQUIRIES MAY ALSO BE MADE BY MAIL ADDRESSED TO THE FUND AT ITS PRINCIPAL
OFFICE:

155 EAST BROAD STREET
COLUMBUS, OHIO 43215
- --------------------------------------------------------------------------------

The Prospectus relates only to Cardinal Tax Exempt Money Market Fund,
currently one of six funds of the Group. Interested persons who wish to obtain
prospectuses of Cardinal Balanced Fund, Cardinal Aggressive Growth Fund, The
Cardinal Fund, Cardinal Government Obligations Fund or Cardinal Government
Securities Money Market Fund should contact The Ohio Company at the number
above. Additional information about the Fund, contained in a Statement Of
Additional Information dated January 10, 1996, has been filed with the
Securities and Exchange Commission and is incorporated herein by reference. Such
Statement is available upon request without charge from the Fund at the above
address or by calling the phone number provided above.

This Prospectus sets forth concisely the information about the Fund that a
prospective investor ought to know before investing in the Fund. This Prospectus
should be retained for future reference.

The Ohio Company

THE DATE OF THIS PROSPECTUS IS JANUARY 10, 1996.

<PAGE> 70

PROSPECTUS HIGHLIGHTS

INVESTMENT OBJECTIVES......... The Fund seeks to maximize current income,
exempt from federal income tax, while
preserving capital and maintaining liquidity.
(See page 3.)

INVESTMENT POLICIES........... The Fund invests in short-term tax exempt
securities including, but not limited to, bond
anticipation notes, construction loan notes,
project notes, revenue anticipation notes and
tax anticipation notes as well as municipal
bonds. (See pages 3 and 4.)

LIQUIDITY..................... Through the free check-writing privilege or
telephone transfer, Shares may be redeemed on
any Business Day at the net asset value without
charge. (See pages 11 and 12.)

PURCHASES..................... There is a minimum initial investment of $1,000
with subsequent minimums of $100. Such minimums
may be waived under certain circumstances. (See
page 7.)

INVESTMENT ADVISER
AND MANAGER................... Cardinal Management Corp. (the "Adviser"), a
wholly-owned subsidiary of The Ohio Company, is
the Fund's investment adviser. The Adviser also
serves as investment adviser for The Cardinal
Fund, Cardinal Government Obligations Fund,
Cardinal Government Securities Money Market
Fund, Cardinal Balanced Fund and Cardinal
Aggressive Growth Fund (collectively, with the
Fund, the "Cardinal Funds"). (See page 15.)

FEE TABLE

<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of offering price).......... 0%
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees...................................................................... .50%
12b-1 Fees........................................................................... 0
Other Expenses(1).................................................................... .32
---
Total Fund Operating Expenses................................................ .82%
===
</TABLE>

EXAMPLE

<FN>
- ---------------
(1) "Other Expenses" are based upon estimated amounts for the current fiscal
year.
</TABLE>

2
<PAGE> 71

PERFORMANCE INFORMATION

From time to time the Fund may advertise its "yield" or "annualized yield,"
its "effective yield," its "tax equivalent yield" and its "tax equivalent
effective yield." ALL YIELD FIGURES ARE BASED ON HISTORICAL EARNINGS AND ARE NOT
INTENDED TO INDICATE FUTURE PERFORMANCE. The "yield" or "annualized yield" of
the Fund refers to the income generated by an investment in the Fund over a
seven-day period (which period will be stated in the advertisement). This income
is then "annualized." That is, the amount of income generated by the investment
during that week is assumed to be generated each week over a 52-week period and
is shown as a percentage of the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an investment in the Fund
is assumed to be reinvested. The "effective yield" will be slightly higher than
the "yield" or "annualized yield" because of the compounding effect of this
assumed reinvestment. The "tax-equivalent yield" demonstrates the taxable yield
necessary to produce an after-tax yield equivalent to that of the Fund. The
"tax-equivalent effective yield" is calculated similarly to the "tax-equivalent
yield" but, when annualized, the income earned by an investment in the Fund is
assumed to be reinvested. The "tax-equivalent effective yield" will be slightly
higher than the "tax-equivalent yield" because of the compounding effect of this
assumed reinvestment.

Investors may also judge the performance of the Fund by comparing or
referencing its performance to the performance of other mutual funds or mutual
fund portfolios with comparable investment objectives and policies through
various mutual fund or market indices such as those prepared by Dow Jones & Co.,
Inc. and Standard & Poor's Corporation and to data prepared by Lipper Analytical
Services, Inc., Morningstar, Inc. and CDA Investment Technologies, Inc.
Comparisons may also be made to indices or data published in Donoghue's MONEY
FUND REPORT of Holliston, Massachusetts, a nationally recognized money market
fund reporting service, Money Magazine, Forbes, Barron's, The Wall Street
Journal, The New York Times, The Columbus Dispatch, Business Week, Consumer
Reports and U.S.A. Today. In addition to performance information, general
information about the Fund that appears in a publication such as those mentioned
above may be included in advertisements and in reports to shareholders.

WHAT IS THE FUND?

The Fund is one separate diversified investment fund of the Group, which
was organized on March 23, 1993, as an Ohio business trust. The Group is
registered and operates as an open-end management investment company as defined
in the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund has
been organized for the purpose of acquiring all of the assets and liabilities of
Cardinal Tax Exempt Money Trust ("CTEMT") to effect a reorganization of CTEMT
from a stand-alone investment company to a separate series of the Group (the
"Reorganization").

WHAT ARE THE INVESTMENT OBJECTIVES
AND POLICIES OF THE FUND?

IN GENERAL

The investment objectives of the Fund is to maximize current income exempt
from federal income tax while preserving capital and maintaining liquidity. The
investment objectives with respect to the Fund are a fundamental policy and as
such may not be changed without a vote of the holders of a majority of the
outstanding Shares of the Fund.

As a money market fund, the Fund invests exclusively in United States
dollar-denominated instruments which the Trustees of the Group and the Adviser
determine present minimal credit risks and which at the time of acquisition are
rated by one or more appropriate nationally recognized statistical rating
organizations ("NRSROs") (e.g., Standard & Poor's Corporation and Moody's
Investors Service, Inc.) in one of the two highest rating categories for
short-term debt obligations

3
<PAGE> 72

or, if unrated, are of comparable quality. All securities or instruments in
which the Fund invests have, or are deemed to have, remaining maturities of 397
calendar days (thirteen months) or less. The dollar-weighted average maturity of
the obligations in the Fund will not exceed 90 days.

As a matter of policy, under normal market conditions, the Fund will invest
at least 80% of its net assets in a diversified portfolio of Municipal
Securities (as defined below), the interest on which is both exempt from federal
income tax and not treated as a preference item for purposes of the federal
alternative minimum tax. Subject to the foregoing limitations and in order to
achieve its investment objective, the Fund expects to invest in the following
types of securities (collectively, "Municipal Securities"): bond anticipation
notes, construction loan notes, project notes, revenue anticipation notes and
tax anticipation notes which, in each case (1) are backed by the full faith and
credit of the United States, (2) are rated in one of the two highest rating
categories by an appropriate NRSRO for short-term tax exempt securities (e.g.,
MIG-1 or MIG-2, by Moody's Investors Service, Inc.) or (3) if the notes are not
rated, are, as determined by the Adviser in accordance with guidelines
established by the Group's Board of Trustees, of a quality equivalent to
securities so rated. The Fund may also invest in municipal bonds and
participation interests therein, including industrial development revenue bonds
and pollution control revenue bonds, which have, or are deemed to have,
remaining maturities of 397 days or less and (1) are rated in one of the two
highest rating categories by an appropriate NRSRO for short-term tax exempt
securities, or (2) if not rated, are, as determined by the Adviser in accordance
with guidelines established by the Group's Board of Trustees, of a quality
equivalent to securities so rated. In addition, the Fund may purchase other
types of tax-exempt Municipal Securities such as short-term discount notes.
These investments must (1) be rated in one of the two highest rating categories
by an appropriate NRSRO for short-term tax exempt securities, or (2) if not
rated, possess equivalent characteristics and quality to securities so rated in
the opinion of the Adviser as determined in accordance with guidelines
established by the Board of Trustees. For further information regarding the
rating categories of the NRSROs, please see the Appendix to the Fund's Statement
of Additional Information.

Current income earned on such Municipal Securities may not be as great as
current income that could be earned on lower quality securities that have less
liquidity and/or a greater risk of nonpayment or securities that have a longer
term.

RISK FACTORS AND INVESTMENT TECHNIQUES

VARIABLE RATE SECURITIES. CTEMT, as the Fund's predecessor, has invested
and the Fund intends to continue to invest more than 25% of its assets in
certain variable or floating rate demand Municipal Securities, including
participation interests therein. The value of such securities may change with
changes in interest rates generally. However, the variable or floating rate
nature of such securities should reduce, to the extent the Fund is invested in
such securities, the degree of fluctuation in the value of portfolio
investments. Accordingly, as interest rates decrease or increase, the potential
for capital appreciation and the risk of potential capital depreciation is less
than would be the case with a portfolio composed entirely of fixed income
securities. The Fund's portfolio may contain variable or floating rate demand
securities on which stated minimum or maximum rates set by state law limit the
degree to which interest on such securities may fluctuate; to the extent it
does, increases or decreases in value may be somewhat greater than would be the
case without such limits. Because the adjustment of interest rates on the
variable or floating rate demand securities is made in relation to movements of
the applicable indexes (e.g., the prime rate), such securities are not
comparable to longer-term fixed rate securities. Accordingly, interest rates on
such securities may be higher or lower than current market rates for fixed rate
obligations of comparable quality with similar maturities. The Fund, however,
will only acquire variable or floating rate securities the interest rates on
which are determined by reference to other short-term market rates of interest.
The Fund will attempt to achieve a balance of variable or floating and fixed
rate securities such that under normal circumstances the net asset value of the
Fund can be maintained at $1.00 per share

4
<PAGE> 73

while the highest possible yield can be returned to investors. To the extent the
Fund's portfolio is invested in variable or floating rate securities, yield can
be expected to decline in periods of falling interest rates more rapidly than if
the Fund's portfolio is invested solely in longer-term fixed rate securities.
Conversely, yield, under the same circumstances, can be expected to increase
more rapidly in periods of rising interest rates. Such instruments may be
considered to be derivatives. A derivative is generally defined as an instrument
whose value is based upon, or derived from, some underlying index, reference
rate (e.g., interest rates), security, commodity or other asset. As stated
above, the Fund has no limit as to the percentage of its total assets that may
be invested in such variable or floating rate securities.

Variable rate demand Municipal Securities in which the Trust invests may be
supported by bank letters of credit or comparable guarantees of financial
institutions. To the extent that 25% or more of the Trust's assets are invested
in variable rate demand Municipal Securities supported by such letters of credit
or guarantees, the Trust may be deemed to be concentrated in the banking
industry. (See "Certain Factors" below)

WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS. The Fund may also purchase
securities on a when-issued or delayed-delivery basis. The Fund will engage in
when-issued and delayed-delivery transactions only for the purpose of acquiring
portfolio securities consistent with its investment objectives and policies, not
for investment leverage, although such transactions represent a form of
leveraging. When-issued securities are securities purchased for delivery beyond
the normal settlement date at a stated price and yield and thereby involve a
risk that the yield obtained in the transaction will be less than those
available in the market when delivery takes place. The Fund will not pay for
such securities or start earning interest on them until they are received
although the payment obligation and the coupon rate have been established before
the time the Fund enters into the commitment. When the Fund agrees to purchase
such securities, its custodian will set aside cash or liquid securities equal to
the amount of the commitment in a separate account. Securities purchased on a
when-issued basis are recorded as an asset and are subject to changes in the
value based upon changes in the general level of interest rates. In when-issued
and delayed-delivery transactions, the Fund relies on the seller to complete the
transaction; the seller's failure to do so may cause the Fund to miss a price or
yield considered to be advantageous.

TAXABLE MONEY MARKET SECURITIES. Under normal operating circumstances,
Fund assets will be managed with a view towards producing only income that is
exempt from federal income taxation. However, the Fund may invest up to 20% of
its assets in "temporary investments," that is, money market instruments
consisting of marketable obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities, deposit obligations of banks and
savings and loans which are members of the Federal Deposit Insurance Corporation
("FDIC"), bankers' acceptances, high-grade commercial paper guaranteed or issued
by domestic corporations and repurchase agreements secured by such obligations.

5
<PAGE> 74

would allow it to purchase directly, (ii) the market value of the underlying
security, including interest accrued, will be at all times equal to or exceed
the value of the repurchase agreement, and (iii) payment for the underlying
securities is made only upon physical delivery or evidence of book-entry
transfer to the account of the Fund's custodian or a bank acting as agent. The
Adviser will be responsible for continuously monitoring such requirements. Use
of repurchase agreements may cause the Fund to earn income which would be
taxable to its shareholders.

INVESTMENT COMPANY SECURITIES. The Fund may also invest up to 10% of the
value of its total assets in the securities of other investment companies
subject to the limitations set forth in the 1940 Act. The Fund intends to invest
in the securities of other money market mutual funds for purposes of short-term
cash management. The Fund's investment in such other investment companies may
result in the duplication of fees and expenses, particularly investment advisory
fees. For a further discussion of the limitations on the Fund's investments in
other investment companies, see "INVESTMENT OBJECTIVES AND
POLICIES -- Additional Information on Portfolio Instruments -- Securities of
Other Investment Companies" in the Fund's Statement of Additional Information.

CERTAIN FACTORS. Naturally, there can be no assurance that the Fund will
achieve its investment objective or be able continuously to maintain a net asset
value per share of $1.00. The characteristics of short-term Municipal Securities
are such that the price stability and liquidity of the Fund may not be equal to
that of a money market fund which exclusively invests in short-term taxable
money market securities. While the Adviser believes that the purchase of
variable rate demand Municipal Securities will facilitate maintaining a $1.00
per share net asset value, the Fund is still expected to have a significantly
longer average maturity than a general purpose taxable money market fund with
the result that the pricing of its portfolio will tend to be more subject to
short-term interest rate fluctuations.

In addition, the Fund expects that substantially all the demand rights of
the Fund with respect to variable rate demand Municipal Securities will be
supported by letters of credit of major commercial banks. Fund investors should
be aware that banks are subject to extensive governmental regulation which may
limit both the amounts and type of loans and other financial commitments which
may be made and interest rates and fees which may be charged. The profitability
of this industry is largely dependent upon the availability and cost of capital
funds for the purpose of financing lending operations under prevailing money
market conditions. Also, general economic conditions play an important part in
the operations of this industry and exposure to credit losses arising from
possible financial difficulties of borrowers might affect a bank's ability to
meet its obligations under a letter of credit.

INVESTMENT RESTRICTIONS

The Fund will not:

1. Purchase securities, if as a result of such purchase more than 5%
of its total assets would be invested in the securities of any one issuer
(other than securities issued or guaranteed by the U.S. Government, its
agencies or instrumentalities, which securities include project notes for
purposes of this restriction), except that up to 25% of the value of the
Fund's assets may be invested without regard to this 5% limitation (for
purposes of this test, the non-governmental user of facilities financed by
industrial development or pollution control revenue bonds and a bank
issuing a letter of credit or comparable guarantee supporting a variable
rate demand municipal security is considered to be the issuer).

2. Purchase the securities of issuers conducting their principal
business activity in the same industry if as a result of such purchase more
than 25% of its total assets would be

6
<PAGE> 75

invested in the securities of issuers in that industry; provided that such
limitation shall not apply to the purchase of Municipal Securities,
securities issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, or securities issued by domestic branches of domestic
banks (the only securities issued by domestic branches of domestic banks
that the Fund contemplates investing in are variable rate demand Municipal
Securities supported by letters of credit or guarantees issued by domestic
branches of domestic banks).

4. Make loans, other than by entering into repurchase agreements and
through the purchase of participation in privately negotiated loans and
portions of publicly issued debt obligations that are in accordance with
its investment objective and policies; provided, however, that the Fund may
not enter into a repurchase agreement if, as a result thereof, more than
10% of its total assets would be subject to repurchase agreements maturing
in more than seven days.

The following additional investment restriction may be changed without the
vote of a majority of the outstanding Shares of the Fund.

The Fund may not:

1. Purchase or otherwise acquire any securities, if as a result, more
than 10% of the Fund's net assets would be invested in securities that are
illiquid.

HOW DO I PURCHASE SHARES OF THE FUND?

GENERAL

Subsequent purchases of Shares of the Fund may be made by ACH processing as
described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED? -- ACH
Processing" below. In addition, if an Account Information Form has previously
been received by The Ohio Company, Shares may also be purchased by wiring funds
to the Fund's custodian as described below under "Purchase by Federal Funds
Wire."

7
<PAGE> 76

All Shares purchased will be credited to shareholder accounts after receipt
of an order and federal funds by The Ohio Company, at the net asset value next
determined. The Fund currently determines net asset value and enters purchases
and redemptions of its Shares as of 4:00 p.m. Eastern Time on each day that the
New York Stock Exchange is open for business and on such other days on which
there is a sufficient degree of trading in the Fund's portfolio securities that
the Fund's net asset value might be materially affected by changes in the value
of the portfolio securities ("Business Day"). If a properly completed order and
federal funds (or other immediately available funds) are received at or prior to
12:00 noon Eastern Time on a Business Day, then the purchase will be entered as
of 4:00 p.m. Eastern Time on that day and dividends will commence on that day.
If either federal funds (or other immediately available funds) or the completed
purchase order are received after 12:00 noon Eastern Time (but prior to 4:00
p.m. Eastern Time) Shares will be credited to the shareholder's account as of
4:00 p.m. Eastern Time on that day but will not earn dividends until the
following day.

PURCHASE BY FEDERAL FUNDS WIRE

The Huntington National Bank
Account Number 01891688407
Routing Number 044000024
17 South High Street
Columbus, Ohio 43215
Attn: Cardinal Tax Exempt Money Market Fund
[Include Fund Account Number and Name of Account Holder]

8
<PAGE> 77

PURCHASE BY MAIL

Investment in Shares of the Fund may be made by mail by sending a check or
other negotiable bank draft payable to the order of "Cardinal Tax Exempt Money
Market Fund" together with, in the case of an initial purchase, an Application
Form to:

Cardinal Tax Exempt Money Market Fund
155 East Broad Street
Columbus, Ohio 43215

AUTOMATIC INVESTMENT PLAN

WHAT DISTRIBUTIONS WILL I RECEIVE?

All dividends of net income are credited to each shareholder's account
daily and automatically reinvested in additional Shares of the Fund at the net
asset value on the last Business Day of each month. Shareholders, however, may
elect to receive monthly the dividends of $10 or more declared on their Shares
in cash by checking the appropriate box on the Account Information Form or by
otherwise notifying the Transfer Agent in writing. In addition, investors may
obtain cash at any time without charge by redeeming Shares at net asset value.
If the entire account of a shareholder is withdrawn, all dividends accrued to
the time of withdrawal will be paid at that time.

Shareholders may also elect to receive dividends and distributions in cash
by using ACH processing as described under "WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED? -- ACH Processing" below.

9
<PAGE> 78

Should the Fund incur or anticipate any extraordinary expense, loss or
depreciation which would adversely affect its net asset value per share or
income for a particular period, the Trustees would at that time consider whether
to adhere to the present dividend policy described above or to revise it in
light of the then-prevailing circumstances. For example, if the Fund's net asset
value per share were reduced, or expected to be reduced, below $1.00, the
Trustees might suspend further dividend accruals until the net asset value
returned to $1.00. Thus, extraordinary expenses or losses or depreciation may
result in no dividends being accrued for the period during which an investor
holds Shares as well as a redemption price lower than the purchase price for
such Shares.

HOW MAY I REDEEM MY SHARES?

Investors may redeem Shares of the Fund on any Business Day at the net
asset value per share next determined following receipt by the Transfer Agent,
215 East Capital Street, Columbus, Ohio 43215, of a written or telephonic notice
to redeem, or by check, each as more fully described below. See "HOW IS NET
ASSET VALUE CALCULATED?" below, for a description of when net asset value is
determined.

The Group may suspend the right of redemption or may delay payment during
any period the determination of net asset value is suspended. See "HOW IS NET
ASSET VALUE CALCULATED?".

REDEMPTION BY MAIL

10
<PAGE> 79

right to reject any signature guarantee if (1) it has reason to believe that the
signature is not genuine or (2) it has reason to believe that the transaction
would otherwise be improper.

REDEMPTION BY TELEPHONE

Shareholders may redeem Shares of the Fund by calling the Group at the
telephone number set forth on the front of this Prospectus. The shareholder may
direct that the redemption proceeds be mailed to the address of record.

EXPEDITED REDEMPTION

AUTOMATIC WITHDRAWAL

SYSTEMATIC WITHDRAWAL PLAN

11
<PAGE> 80

CHECK-WRITING REDEMPTION PROCEDURE

WHAT OTHER SHAREHOLDER PROGRAMS ARE PROVIDED?

ACH PROCESSING

EXCHANGE PRIVILEGE

Cardinal Aggressive Growth Fund,
an equity fund seeking appreciation of
capital (upon the payment of the applicable sales charge);

Cardinal Balanced Fund,
a fund seeking current income and long-term
growth of both capital and income (upon the
payment of the applicable sales charge);

The Cardinal Fund,
an equity fund seeking long-term growth
of capital and income (upon the payment of
the applicable sales charge);

12
<PAGE> 81

Cardinal Government Obligations Fund,
a fund investing in securities issued
or guaranteed by the U.S. Government
(upon the payment of the applicable
sales charge); or

Cardinal Government Securities Money Market Fund,
a short-term U.S. Government securities fund
(without payment of any sales charge).

The foregoing exchange privilege must be made by written or telephonic
authorization. A shareholder should notify The Ohio Company of his desire to
make an exchange, and The Ohio Company will furnish, as necessary, a prospectus
and an application form to open the account. The Transfer Agent will require
that any written authorization of an exchange include a signature guarantee as
described above under "HOW MAY I REDEEM MY SHARES? -- Redemption by mail."
However, a signature guarantee will not be required if the exchange is requested
to be made within the same account or into an existing account of the
shareholder held in the same name or names and in the same capacity as the
account from which the exchange is to be made. Shareholders may also authorize
an exchange of shares of the Fund by telephone. Neither the Group, the Fund nor
any of its service providers will be liable for any loss, damages, expense or
cost arising out of any telephone exchange authorization to the extent and
subject to the requirements set forth under "HOW MAY I REDEEM MY
SHARES? -- Redemption by telephone" above.

For tax purposes, an exchange is treated as a redemption and a new
purchase.

HOW IS NET ASSET VALUE CALCULATED?

13
<PAGE> 82

DOES THE FUND PAY FEDERAL INCOME TAX?

Each of the funds of the Group, including the Fund, is treated as a
separate entity for federal income tax purposes and intends to qualify as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended (the "Code"), for so long as such qualification is in the best interest
of that fund's shareholders. Qualification as a regulated investment company
under the Code requires, among other things, that the regulated investment
company distribute to its shareholders at least 90% of its investment company
taxable income. The Fund contemplates declaring as dividends 100% of the Fund's
investment company taxable income (before deduction of dividends paid).

WHAT ABOUT MY TAXES?

FEDERAL TAXES

The Fund will distribute substantially all of its net investment income and
net capital gains to shareholders. Dividends derived from interest earned on
Municipal Securities the interest on which is excluded from gross income for
federal income tax purposes, including insurance proceeds representing maturing
interest on defaulted Municipal Securities the interest on which would be so
excluded, constitute "exempt-interest dividends" when designated as such by the
Fund and will be excluded from gross income for federal income tax purposes.
However, interest excluded from gross income for federal income tax purposes
that is received by individuals and corporations on certain municipal
obligations issued on or after August 8, 1986, to finance certain private
activities will be treated as a tax preference item in computing the alternative
minimum tax. It is likely that exempt-interest dividends received by
shareholders from the Fund will also be treated as tax preference items in
computing the alternative minimum tax to the extent, if any, that distributions
by the Fund are attributable to interest earned by the Fund on such obligations.
Also, a portion of all other interest excluded from gross income for federal
income tax purposes earned by a corporation may be subject to the alternative
minimum tax as a result of the inclusion in alternative minimum taxable income
of 75% of the excess of adjusted current earnings over adjusted net book income.

Distributions, if any, derived from capital gains will generally be taxable
to shareholders as capital gains for federal income tax purposes to the extent
so designated by the Fund. Dividends, if any, derived from sources other than
interest excluded from gross income for federal income tax purposes and capital
gains will be taxable to shareholders as ordinary income for federal income tax
purposes whether or not reinvested in additional Shares. Shareholders not
subject to federal income tax on their income will not, of course, be required
to pay federal income tax on any amounts distributed to them. The Fund
anticipates that substantially all of its dividends will be excluded from gross
income for federal income tax purposes and will not be a preference item for
individuals for purposes of the federal alternative minimum tax.

If a shareholder receives an exempt-interest dividend with respect to any
Share and such Share is held by the shareholder for six months or less, any loss
on the sale or exchange of such Share will be disallowed to the extent of the
amount of such exempt-interest dividend. In certain limited instances, the
portion of Social Security benefits that may be subject to federal income
taxation, may be affected by the amount of tax-exempt interest income, including
exempt-interest dividends, received by a shareholder.

14
<PAGE> 83

STATE AND LOCAL TAXES

Under state or local law, distributions of net investment income may be
taxable to shareholders as dividend income even though a substantial portion of
such distribution may be derived from interest excluded from gross income for
federal income tax purposes that, if received directly, would be exempt from
such income taxes. The Fund will report to its shareholders annually after the
close of its taxable year the percentage and source, on a state-by-state basis,
of interest income earned on Municipal Securities held by the Fund during the
preceding year.

The Transfer Agent will inform shareholders at least annually of the amount
and nature of such income and capital gains.

WHO MANAGES MY INVESTMENT IN THE FUND?

INVESTMENT ADVISER AND MANAGER

15
<PAGE> 84

25 years of investment management experience. In addition, pursuant to the
Investment Advisory Agreement, the Adviser generally assists in all aspects of
the Fund's administration and operation.

For the services provided and expenses assumed pursuant to its investment
advisory agreement with the Group with respect to the Fund, the Adviser receives
a fee from the Fund, computed daily and paid monthly at the annual rate of .50%
of average net daily assets of the Fund. The Adviser may periodically waive all
or a portion of its advisory fee with respect to the Fund to increase the net
income of the Fund available for distributions as dividends. The waiver of such
fee will cause the yield of the Fund to be higher than it would otherwise be in
the absence of such waiver.

DIVIDEND AND TRANSFER AGENT AND FUND ACCOUNTANT

The Group has entered into a Transfer Agency and Fund Accounting Agreement
with Cardinal Management Corp. (the "Transfer Agent"), 215 East Capital Street,
Columbus, Ohio 43215, pursuant to which the Transfer Agent has agreed to act as
the Fund's transfer agent and dividend disbursing agent. In consideration of
such services, the Fund has agreed to pay the Transfer Agent an annual fee, paid
monthly, equal to $21 per shareholder account plus out-of-pocket expenses. In
addition, the Transfer Agent provides certain fund accounting services for the
Fund. The Transfer Agent receives a fee from the Fund for such services equal to
a fee computed daily and paid periodically at an annual rate of .03% of the
Fund's average daily net assets.

DISTRIBUTOR

EXPENSES

The Adviser bears all expenses in connection with the performance of its
services as investment adviser, manager, transfer agent and fund accountant
other than the cost of securities (including brokerage commissions, if any)
purchased for the Fund. The Fund will bear the following expenses relating to
its operations: organizational expenses, taxes, interest, any brokerage fees and
commissions, fees and expenses of the Trustees of the Group, Commission fees,
state securities qualification fees, costs of preparing and printing
prospectuses for regulatory purposes and for distribution to the Fund's current
shareholders, outside auditing and legal expenses, advisory fees, fees and
out-of-pocket expenses of the custodian and Transfer Agent, costs for
independent pricing services, certain insurance premiums, costs of maintenance
of the Group's existence, costs of shareholders' reports and meetings, and any
extraordinary expenses incurred in the Fund's operation.

CUSTODIAN

WHAT ARE MY RIGHTS AS A SHAREHOLDER?

16
<PAGE> 85

Market Fund, Cardinal Balanced Fund and Cardinal Aggressive Growth Fund. Each
share represents an equal proportional interest in a fund with other shares of
the same fund, and is entitled to such dividends and distributions out of the
income earned on the assets belonging to that fund as are declared at the
discretion of the Trustees.

Shareholders should direct all inquiries concerning such matters to the
Transfer Agent in writing to 215 East Capital Street, Columbus, Ohio 43215, or
by calling (800) 282-9446.

Shareholders will receive unaudited semi-annual reports describing the
investment operations of the Fund and annual financial reports audited by
independent auditors.

17
<PAGE> 86

[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE> 87

Investment Adviser and Manager
Cardinal Management Corp.
155 East Broad Street
Columbus, Ohio 43215

Distributor
The Ohio Company
155 East Broad Street
Columbus, Ohio 43215

Transfer Agent and Dividend Paying Agent
Cardinal Management Corp.
215 East Capital Street
Columbus, Ohio 43215

Custodian
The Fifth Third Bank
38 Fountain Square Plaza
Cincinnati, Ohio 45263

Legal Counsel
Baker & Hostetler
65 East State Street
Columbus, Ohio 43215

Independent Auditors
KPMG Peat Marwick LLP
Two Nationwide Plaza
Columbus, Ohio 43215
<PAGE> 88

- ------------------------------------------------------
- ------------------------------------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS HIGHLIGHTS................. 2
FEE TABLE............................. 2
PERFORMANCE INFORMATION............... 3
WHAT IS THE FUND?..................... 3
WHAT ARE THE INVESTMENT OBJECTIVES AND
POLICIES OF THE FUND?............... 3
HOW DO I PURCHASE SHARES OF THE
FUND?............................... 7
WHAT DISTRIBUTIONS WILL I RECEIVE?.... 9
HOW MAY I REDEEM MY SHARES?........... 10
WHAT OTHER SHAREHOLDER PROGRAMS ARE
PROVIDED?........................... 12
HOW IS NET ASSET VALUE CALCULATED?.... 13
DOES THE FUND PAY FEDERAL INCOME
TAX?................................ 14
WHAT ABOUT MY TAXES?.................. 14
WHO MANAGES MY INVESTMENT IN THE
FUND?............................... 15
WHAT ARE MY RIGHTS AS A
SHAREHOLDER?........................ 16
</TABLE>

------------------------

- ------------------------------------------------------
- ------------------------------------------------------

The Ohio Company

CARDINAL
TAX EXEMPT MONEY
MARKET FUND
------------------------

PROSPECTUS

------------------------

JANUARY 10, 1996

- ------------------------------------------------------
- ------------------------------------------------------
<PAGE> 89
Rule 497(c) File No. 811-7588

STATEMENT OF ADDITIONAL INFORMATION

THE CARDINAL FUND

CARDINAL GOVERNMENT OBLIGATIONS FUND

CARDINAL GOVERNMENT SECURITIES MONEY MARKET FUND

CARDINAL TAX EXEMPT MONEY MARKET FUND

FOUR INVESTMENT PORTFOLIOS OF

THE CARDINAL GROUP

The Cardinal Fund ("TCF"), Cardinal Government Obligations Fund
("CGOF"), Cardinal Government Securities Money Market Fund ("CGSMMF") and
Cardinal Tax Exempt Money Market Fund ("CTEMMF") (collectively, the "Funds" and
individually a "Fund") are each a separate diversified, investment portfolio of
The Cardinal Group, an open-end, management investment company (the "Group").
The investment objectives of TCF are long-term growth of capital and income.
Current income is a secondary objective. The investment objectives of CGOF are
to maximize safety of capital and, consistent with such objective, earn the
highest available current income obtainable from government securities. The
investment objectives of CGSMMF are to maximize current income while preserving
capital and maintaining liquidity. The investment objectives of CTEMMF are to
maximize current income exempt from federal income tax while preserving capital
and maintaining liquidity.

------------------------------------------------------------

For further information regarding the Funds or for assistance
in opening an account or redeeming Shares, please call (800)
282-9446 toll free.

Inquiries may also be made by mail addressed
to the Group at its principal office:

155 East Broad Street
Columbus, Ohio 43215

This Statement Of Additional Information is not a prospectus and
should be read in conjunction with the Prospectuses of the Funds, each dated as
of January 10, 1996, which have been filed with the Securities and Exchange
Commission. This Statement of Additional Information is incorporated by
reference in its entirety into the Prospectuses. The Prospectuses are
available upon request without charge from the Group at the above address or by
calling the phone number provided above.

JANUARY 10, 1996

<PAGE> 90
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
THE CARDINAL GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

Additional Information on Portfolio Instruments . . . . . . . . . . . . . . . . . . . . B-1
Investment Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-11
Portfolio Turnover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-14

MANAGEMENT OF THE GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-15

PRINCIPAL SHAREHOLDERS OF THE GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-18

THE ADVISER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-18

PORTFOLIO TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-20

TRANSFER AND DIVIDEND AGENT AND FUND ACCOUNTANT . . . . . . . . . . . . . . . . . . . . . . . . . B-22

EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-23

THE DISTRIBUTOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-23

CUSTODIAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-25

LEGAL COUNSEL AND INDEPENDENT AUDITORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-25

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . B-25

Determination of Net Asset Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-26

TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-27

ADDITIONAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-32

Description of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-32
Vote of a Majority of the Outstanding Shares . . . . . . . . . . . . . . . . . . . . . . B-33
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-33

PERFORMANCE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-34

Yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-34
Calculation of Total Return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-35
Performance Comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-36

APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

</TABLE>
<PAGE> 91

STATEMENT OF ADDITIONAL INFORMATION

THE CARDINAL GROUP

The Cardinal Group (the "Group") is an open-end management investment
company which currently offers six separate diversified investment portfolios,
each with different investment objectives.

This Statement of Additional Information contains information about
The Cardinal Fund ("TCF"), Cardinal Government Obligations Fund ("CGOF"),
Cardinal Government Securities Money Market Fund ("CGSMMF") and Cardinal Tax
Exempt Money Market Fund ("CTEMMF") (collectively, the "Funds" and individually
a "Fund").

Much of the information contained in this Statement of Additional
Information expands upon subjects discussed in the Prospectus of the respective
Fund. Capitalized terms not defined herein are defined in the Prospectuses.
No investment in Shares of a Fund should be made without first reading the
Prospectus of that Fund.

INVESTMENT OBJECTIVES AND POLICIES

Additional Information on Portfolio Instruments
- -----------------------------------------------

The following policies supplement the investment objectives and
policies of the Funds as set forth in their respective Prospectuses.

BANK OBLIGATIONS. As described in its Prospectus, CTEMMF may invest
in bank obligations consisting of bankers' acceptances, certificates of
deposit, and time deposits.

Bankers' acceptances are negotiable drafts or bills of exchange
typically drawn by an importer or exporter to pay for specific merchandise,
which are "accepted" by a bank, meaning, in effect, that the bank
unconditionally agrees to pay the face value of the instrument on maturity.
Bankers' acceptances invested in by CTEMMF will be those guaranteed by domestic
and foreign banks having, at the time of investment, assets in excess of
$500,000,000 (as of the date of their most recently published financial
statements).

Certificates of deposit are negotiable certificates issued against
funds deposited in a commercial bank or a savings and loan association for a
definite period of time and earning a specified return. Certificates of
deposit and time deposits will be those of domestic banks and savings and loan
associations, if at the time of investment the depository institution has
assets in excess of $500,000,000 (as of the date of its most recently published
financial statements).

B-1
<PAGE> 92
COMMERCIAL PAPER. Commercial paper in which TCF, CGOF and CTEMMF may
invest consists of unsecured promissory notes issued by corporations. Issues
of commercial paper normally have maturities of less than nine months and fixed
rates of return.

TCF, CGOF and CTEMMF will invest only in commercial paper which is
rated at the time of purchase within the two highest rating groups assigned by
one or more appropriate NRSROs, or if unrated, which the Adviser determines to
be of comparable quality. For a description of the rating symbols of the
NRSROs, see the Appendix.

U.S. GOVERNMENT OBLIGATIONS. CGOF and CGSMMF invest in, and TCF and
CTEMMF may invest in, obligations issued or guaranteed by the U.S. Government
or its agencies or instrumentalities. Obligations of certain agencies and
instrumentalities of the U.S. Government are supported by the full faith and
credit of the U.S. Treasury; others are supported by the right of the issuer to
borrow from the Treasury; others are supported by the discretionary authority
of the U.S. Government to purchase the agency's obligations; and still others
are supported only by the credit of the instrumentality. No assurance can be
given that the U.S. Government would provide financial support to U.S.
Government-sponsored agencies or instrumentalities if it is not obligated to
do so by law.

MUNICIPAL SECURITIES. Municipal Securities which may be purchased by
CTEMMF currently can be divided into two basic groups: Municipal Notes and
Municipal Bonds.

Municipal Notes generally provide capital for short-term needs and
have maturities of one year or less. They include:

1. PROJECT NOTES. Project notes are sold through the
Department of Housing and Urban Development to raise funds for
federally sponsored urban renewal, neighborhood development and
housing programs. In low-income housing, proceeds from project notes
are chiefly used for construction financing prior to permanent
financing. In urban renewal the funds have generally been used for
land acquisition and site improvements. (No new urban renewal
projects are currently being undertaken as that program has been
superseded by the Community Block Grant Program contained in the
Housing and Community Development Act of 1974.) Project notes are
issued by public bodies created under the laws of one of the states,
territories or U.S. possessions and are referred to as Local Issuing
Agencies. Project Notes generally range in maturity from three months
to one year. While they are the primary obligations of the public
housing agencies or the local urban renewal agencies which have issued
them, they are also secured by the full faith and credit of the U.S.
Government. Payment by the United States pursuant to its full faith
and credit

B-2
<PAGE> 93
obligation does not impair the tax-exempt character of the income from
project notes.

2. TAX ANTICIPATION NOTES. Tax anticipation notes are
issued by state and local governments in anticipation of collection of
taxes to finance the current operations of such governments. The
notes are generally payable only from tax collections and often only
from the proceeds of the specific tax levy whose collection they
anticipate.

3. REVENUE ANTICIPATION NOTES. Revenue anticipation
notes are issued by governmental entities in anticipation of revenues
to be received later in the then current fiscal year.

4. BOND ANTICIPATION NOTES. Bond anticipation notes are
issued in anticipation of a later issuance of bonds and are usually
payable from the proceeds of the sale of the bonds anticipated or of
renewal notes.

5. CONSTRUCTION LOAN NOTES. Construction loan notes,
issued to provide construction financing for specific projects, are
often redeemed after the projects are completed and accepted with
funds obtained from the Federal Housing Administration under "Fannie
Mae" (Federal National Mortgage Association) or "Ginnie Mae"
(Government National Mortgage Association).

6. TAX-EXEMPT COMMERCIAL PAPER. Tax-exempt commercial
paper is issued by state and local governments and agencies thereof to
finance seasonal working capital needs or in anticipation of longer
term financing. The stated maturity is 365 days or less.

Municipal Bonds are usually issued to obtain funds for various public
purposes, to refund outstanding obligations, to meet general operating expenses
or to obtain funds to lend to other public institutions and facilities. They
are generally classified as either "general obligation" or "revenue" bonds and
frequently have maturities in excess of one year at the time of issuance,
although issues having variable interest rates with demand features may permit
CTEMMF to treat them as having maturities of less than 397 days. See
"ADDITIONAL PURCHASE AND REDEMPTION INFORMATION -- Determination of Net Asset
Value" herein and "HOW IS NET ASSET VALUE CALCULATED?" in CTEMMF's Prospectus.

1. GENERAL OBLIGATION BONDS. General obligation bonds
are issued by states, counties, regional districts, cities, towns and
school districts for a variety of purposes including mass
transportation, highway, bridge, school, road, and water and sewer
system construction, repair or improvement. Payment of these bonds is
secured by a pledge of the issuer's full faith and credit and taxing
(usually property tax) power.

B-3
<PAGE> 94
2. REVENUE BONDS. Revenue bonds are payable solely from
the revenues generated from the operations of the facility or
facilities being financed or from other non-tax sources. These bonds
are often secured by debt service reserve funds, rent subsidies and/or
mortgage collateral to finance the construction of housing, highways,
bridges, tunnels, hospitals, university and college buildings, port
and airport facilities, and electric, water, gas and sewer systems.

3. INDUSTRIAL DEVELOPMENT REVENUE AND PRIVATE ACTIVITY
BONDS. Industrial development revenue bonds and private activity
bonds are usually issued by local government bodies or their
authorities to provide funding for industrial facilities, privately
operated housing, health care facilities, airports, docks and mass
commuting facilities, certain water and sewage facilities, qualified
hazardous waste facilities and high speed innercity rail facilities.
Under prior law, these bonds also were issued to finance commercial
facilities, sports facilities, convention and trade show facilities
and pollution control facilities. Payment of principal and interest
on such bonds is not secured by the taxing power of the governmental
body. Rather, payment is dependent solely upon the ability of the
users of the facilities financed by the bonds to meet their financial
obligations and the pledge, if any, of the real and personal property
financed by such bonds as security for payment.

Legislation to restrict or eliminate the federal income tax exemption
for interest on certain Municipal Securities has been enacted periodically in
the recent past and additional legislation may be enacted in the future. This
legislation may adversely affect the availability of Municipal Securities for
CTEMMF's portfolio. If any such legislation has a materially adverse effect on
CTEMMF's ability to achieve its investment objectives, CTEMMF will re-evaluate
its investment objectives and submit to its shareholders for approval necessary
changes in the objectives and policies of CTEMMF.

The Municipal Securities described above represent those which CTEMMF
currently expects to purchase. However, several new types of municipal bonds
and notes, particularly those with shorter maturities, have been introduced in
recent years and the Adviser believes that other types of municipal bonds and
notes may be offered in the future. Therefore, in order to preserve maximum
flexibility in seeking to attain its investment objectives, CTEMMF has
determined not to limit its purchase to the types of Municipal Securities
described herein, although it will purchase only municipal obligations which
have the credit characteristics described herein. In addition, CTEMMF may not
purchase any municipal bonds or notes having characteristics or terms that are

B-4
<PAGE> 95
inconsistent with the investment objectives or investment policies of CTEMMF.

Subsequent to CTEMMF's purchase of a security, it may be assigned a
lower rating or cease to be rated. In such an event the Adviser is required to
promptly reassess the credit quality of such security. If such security no
longer presents minimal credit risks or if the security is deemed to be an
"Unrated Security" or a "Second-Tier Security," within the meaning of Rule 2a-7
of the 1940 Act, and receives a rating by any NRSRO below the second highest
rating category, the Adviser is generally required to sell such security within
five business days of becoming aware of such an event.

VARIABLE RATE DEMAND MUNICIPAL SECURITIES. Variable rate demand
Municipal Securities are tax-exempt obligations that provide for a periodic
adjustment in the interest rate paid on the securities and permit the holder to
demand payment of the unpaid principal balance plus accrued interest upon a
specified number of days' notice either from the issuer or by drawing on a bank
letter of credit or comparable guarantee issued with respect to such security.
The issuer of a variable rate demand security may have a corresponding right to
prepay in its discretion the outstanding principal of the instrument plus
accrued interest upon notice comparable to that required for the holder to
demand payment.

The terms of the securities must provide that interest rates are
adjustable at intervals ranging from weekly up to semi-annually. The
adjustments are based upon the prime rate of a bank or other appropriate
interest rate adjustment index as provided in the respective instruments. The
variable rate demand securities purchased by CTEMMF are subject to the quality
characteristics for Municipal Securities described above. While these
securities are expected to have maturities in excess of one year, the Adviser
will determine at least monthly that such securities are of high quality. The
Trustees have instructed the Adviser to exercise its right to demand payment of
principal and accrued interest thereon, if a variable rate demand security held
by CTEMMF no longer meets the quality standards of CTEMMF, unless, of course,
the security can be sold for a greater amount in the market.

The principal and accrued interest payable to CTEMMF on demand will be
supported by an irrevocable letter of credit or comparable guarantee of a
financial institution (generally a commercial bank) whose short-term taxable
debt meets the quality criteria for investment by CTEMMF in Municipal
Securities, except in cases where the security itself meets the credit criteria
of CTEMMF without such letter of credit or comparable guarantee. Thus,
although a variable rate demand security may be unrated, CTEMMF will have at
all times an alternate high quality credit source to draw upon for payment with
respect to such security.

B-5
<PAGE> 96
The variable rate demand securities which CTEMMF may purchase include
participation interests in variable rate securities. Such participation
interests will have, as part of the participation agreement between CTEMMF and
the selling financial institution, a demand feature which permits CTEMMF to
demand payment from the seller of the principal amount of CTEMMF's
participation plus accrued interest thereon. This demand feature always will
be supported by a letter of credit or comparable guarantee provided by the
selling financial institution. Such financial institution will retain a
service and a letter of credit fee, and a fee for issuing commitments to
purchase on demand, in an amount equal to the excess of the interest paid on
the variable rate security in which CTEMMF has a participation interest over
the negotiated yield at which the participation interest was purchased by
CTEMMF. Accordingly, CTEMMF will purchase such participation interests only
when the yield to CTEMMF, net of such fees, is equal to or greater than the
yield then available on other variable rate demand securities or short-term
fixed rate tax exempt securities of comparable quality and where the fees are
reasonable in relation to the services provided by the financial institution
and the security and liquidity provided by the letter of credit or guarantee.

CONCENTRATION. CTEMMF may invest more than 25% of its net assets in
(i) Municipal Securities whose issuers are in the same state, (ii) Municipal
Securities, the interest upon which is paid solely from revenues of similar
projects and (iii) industrial development and pollution control revenue bonds
which are not variable rate demand Municipal Securities, I.E., Municipal
Securities which are related in such a way that an economic, business or
political development or change affecting one such Municipal Security would
also affect the other Municipal Securities; for example, Municipal Securities
the interest on which is paid from revenues of similar type projects or
Municipal Securities whose issuers are located in the same state. Provided,
however, that prior to CTEMMF's so investing its net assets CTEMMF will amend
its Prospectus to disclose such practice. The District of Columbia, each
state, each of its political subdivisions, agencies, instrumentalities and
authorities, and each multi-state agency of which a state is a member, is a
separate "issuer" as that term is used in this Statement of Additional
Information and in CTEMMF's investment restrictions contained in its
Prospectus. The identification of the "issuer" depends on the terms and
conditions of the security. When the assets and revenues of an agency,
authority, instrumentality or other political subdivision are separate from
those of the government creating the subdivision and the security is supported
only by the assets and revenues of the subdivision, such subdivision would be
deemed to be the sole "issuer." Similarly, in the case of an industrial
development or pollution control revenue bond, if that bond is supported only
by the assets and revenues of the nongovernmental user, then such
nongovernmental user would be deemed to be the sole "issuer." If, however, in
either case, the creating government or some other

B-6
<PAGE> 97
entity guarantees a security, such a guarantee would be considered a separate
security and must be separately valued.

WHEN-ISSUED AND DELAYED-DELIVERY SECURITIES. CGOF, CGSMMF and CTEMMF
may purchase securities on a "when-issued" or "delayed-delivery" basis (I.E.,
for delivery beyond the normal settlement date at a stated price and yield).
When a Fund agrees to purchase securities on a "when-issued" or
"delayed-delivery" basis, the Fund's custodian will set aside in a separate
account cash or liquid portfolio securities equal to the amount of the
commitment. Normally, the custodian will set aside portfolio securities to
satisfy the purchase commitment, and in such a case, the Fund may be required
subsequently to place additional assets in the separate account in order to
assure that the value of the account remains equal to the amount of such Fund's
commitment. It may be expected that a Fund's net assets will fluctuate to a
greater degree when it sets aside portfolio securities to cover such purchase
commitments than when it sets aside cash. In addition, because a Fund will set
aside cash or liquid portfolio securities to satisfy its purchase commitments
in the manner described above, such Fund's liquidity and the ability of the
Adviser to manage it might be affected in the event its commitments to purchase
"when-issued" or "delayed-delivery" securities ever exceeded 25% of the value
of its assets. Under normal market conditions, however, neither CGOF's,
CGSMMF's nor CTEMMF's commitments to purchase "when-issued" or
"delayed-delivery" securities will exceed 25% of the value of its assets.

When CGOF, CGSMMF or CTEMMF engages in "when-issued" or
"delayed-delivery" transactions, such Fund relies on the seller to consummate
the trade. Failure of the seller to do so may result in that Fund's incurring
a loss or missing the opportunity to obtain a price considered to be
advantageous. CGOF, CGSMMF and CTEMMF will engage in "when-issued" or
"delayed-delivery" transactions only for the purpose of acquiring portfolio
securities consistent with such Fund's investment objectives and policies and
not for investment leverage.

SECURITIES OF OTHER INVESTMENT COMPANIES. Each Fund may invest in
securities issued by other investment companies. Each Fund currently intends
to limit its investments so that, as determined immediately after a securities
purchase is made: (a) not more than 5% of the value of its total assets will
be invested in the securities of any one investment company; (b) not more than
10% of the value of its total assets will be invested in the aggregate in
securities of investment companies as a group; and (c) not more than 3% of the
outstanding voting stock of any one investment company will be owned by such
Fund. As a shareholder of another investment company, a Fund would bear, along
with other shareholders, its pro rata portion of that company's expenses,
including advisory fees. These expenses would be in addition to the advisory
and other expenses that such Fund bears directly in connection with its own
operations. Investment companies in which

B-7
<PAGE> 98
TCF and CGOF may invest may also impose a sales or distribution charge in
connection with the purchase or redemption of their shares and other types of
commissions or charges. Such charges will be payable by such Fund and,
therefore, will be borne directly by shareholders.

REPURCHASE AGREEMENTS. Securities held by each of the Funds may be
subject to repurchase agreements. Under the terms of a repurchase agreement, a
Fund would acquire securities from member banks of the Federal Reserve System
and registered broker-dealers which the Adviser deems creditworthy under
guidelines approved by the Group's Board of Trustees, subject to the seller's
agreement to repurchase such securities at a mutually agreed-upon date and
price. The repurchase price would generally equal the price paid by the Fund
plus interest negotiated on the basis of current short-term rates, which may be
more or less than the rate on the underlying portfolio securities. The seller
under a repurchase agreement will be required to maintain at all times the
value of collateral held pursuant to the agreement at not less than the
repurchase price (including accrued interest). In the event of a bankruptcy or
other default of a seller of a repurchase agreement, the Fund could experience
both delays in liquidating the underlying securities and losses, including:
(a) possible decline in the value of the underlying securities during the
period while the Fund seeks to enforce its rights thereto; (b) possible
subnormal levels of income and lack of access to income during this period; and
(c) expenses of enforcing its rights. Additionally, there is no controlling
legal precedent confirming that the Fund would be entitled, as against a claim
by such seller or its receiver or trustee in bankruptcy, to retain the
underlying securities, although the Board of Trustees of the Group believes
that, under the regular procedures normally in effect for custody of the Fund's
securities subject to repurchase agreements and under federal laws, a court of
competent jurisdiction would rule in favor of the Group if presented with the
question. Securities subject to repurchase agreements will be held by the
Group's custodian or another qualified custodian or in the Federal
Reserve/Treasury book-entry system. Repurchase agreements are considered to be
loans by a Fund under the 1940 Act.

REVERSE REPURCHASE AGREEMENTS. CTEMMF is permitted to enter into
reverse repurchase agreements for temporary or emergency non-investment
purposes in an amount not exceeding (together with other borrowings) 5% of the
value of CTEMMF's assets at the time of entering into the agreement. CTEMMF,
however, has not entered into such agreements in the past and does not intend
to enter into such agreements in the foreseeable future.

FOREIGN INVESTMENT. Investment in foreign securities is subject to
special investment risks that differ in some respects from those related to
investments in securities of U.S. domestic issuers. Since investments in the
securities of foreign issuers

B-8
<PAGE> 99
may involve currencies of foreign countries, TCF may be affected favorably or
unfavorably by changes in currency rates and in exchange control regulations
and may incur costs in connection with conversions between various currencies.

Since foreign companies are not subject to uniform accounting,
auditing and financial reporting standards, practices and requirements
comparable to those applicable to U.S. companies, there may be less publicly
available information about a foreign company than about a U.S. company.
Securities of many foreign companies are less liquid and more volatile than
securities of comparable U.S. companies.

In addition, with respect to certain foreign countries, there is the
possibility of expropriation or confiscatory taxation, political or social
instability, or diplomatic developments which could affect TCF's investments in
those countries. Moreover, individual foreign economies may differ favorably
or unfavorably from the U.S. economy in such respects as growth of gross
national product, rate of inflation, capital reinvestment, resource
self-sufficiency and balance of payments position.

TCF will acquire such securities only when the Adviser believes the
risks associated with such investments are minimal.

OPTIONS TRADING. Each of TCF and CGOF may purchase put and call
options. A call option gives the purchaser of the option the right to buy, and
a writer has the obligation to sell, the underlying security at the stated
exercise price at any time prior to the expiration of the option, regardless of
the market price of the security. The premium paid to the writer is
consideration for undertaking the obligations under the option contract. A put
option gives the purchaser the right to sell the underlying security at the
stated exercise price at any time prior to the expiration date of the option,
regardless of the market price of the security. Put and call options purchased
by such Funds will be valued at the last sale price, or in the absence of such
a price, at the mean between bid and asked price.

When a Fund writes an option, an amount equal to the net premium (the
premium less the commission) received by the Fund is included in the liability
section of the Fund's statement of assets and liabilities as a deferred credit.
The amount of the deferred credit will be subsequently marked-to-market to
reflect the current value of the option written. The current value of the
traded option is the last sale price or, in the absence of a sale, the average
of the closing bid and asked prices. If an option expires on the stipulated
expiration date or if the Fund enters into a closing purchase transaction, it
will realize a gain (or a loss if the cost of a closing purchase transaction
exceeds the net premium received when the option is sold) and the deferred
credit related to such option will be eliminated. If an option is exercised,
the

B-9
<PAGE> 100
Fund may deliver the underlying security in the open market. In either event,
the proceeds of the sale will be increased by the net premium originally
received and the Fund will realize a gain or loss.

TCF and CGOF may also purchase or sell index options. Index options
(or options on securities indices) are similar in many respects to options on
securities except that an index option gives the holder the right to receive,
upon exercise, cash instead of securities, if the closing level of the
securities index upon which the option is based is greater than, in the case of
a call, or less than, in the case of a put, the exercise price of the option.

FUTURES CONTRACTS. As discussed in the Prospectuses of the TCF and
CGOF, each of those Funds may enter into futures contracts. This investment
technique is designed primarily to hedge against anticipated future changes in
market conditions which otherwise might adversely affect the value of
securities which a Fund holds or intends to purchase. For example, when
interest rates are expected to rise or market values of portfolio securities
are expected to fall, a Fund can seek through the sale of futures contracts to
offset a decline in the value of its portfolio securities. When interest rates
are expected to fall or market values are expected to rise, a Fund, through the
purchase of such contracts, can attempt to secure better rates or prices for
the Fund than might later be available in the market when it effects
anticipated purchases.

The acquisition of put and call options on futures contracts will,
respectively, give a Fund the right (but not the obligation), for a specified
price, to sell or to purchase the underlying futures contract, upon exercise of
the option, at any time during the option period.

Futures transactions involve brokerage costs and require a Fund to
segregate liquid assets, such as cash, U.S. Government securities or other
liquid high grade debt obligations, to cover its performance under such
contracts. A Fund may lose the expected benefit of futures transactions if
interest rates, securities prices or foreign exchange rates move in an
unanticipated manner. Such unanticipated changes may also result in poorer
overall performance than if the Fund had not entered into any futures
transactions. In addition, the value of a Fund's futures positions may not
prove to be perfectly or even highly correlated with the value of its portfolio
securities, limiting the Fund's ability to hedge effectively against interest
rate and/or market risk and giving rise to additional risks. There is no
assurance of liquidity in the secondary market for purposes of closing out
futures positions.

REGULATORY RESTRICTIONS. To the extent required to comply with
Securities and Exchange Commission Release No. IC-10666, when

B-10
<PAGE> 101
purchasing a futures contract or writing a put option, a Fund will maintain in
a segregated account cash or liquid high-grade securities equal to the value of
such contracts.

To the extent required to comply with Commodity Futures Trading
Commission Regulation 4.5 and thereby avoid being classified as a "commodity
pool operator," a Fund will not enter into a futures contract or purchase an
option thereon if immediately thereafter the initial margin deposits for
futures contracts held by such Fund plus premiums paid by it for open options
on futures would exceed 5% of such Fund's total assets. A Fund will not engage
in transactions in financial futures contracts or options thereon for
speculation, but only to attempt to hedge against changes in market conditions
affecting the values of securities which such Fund holds or intends to
purchase. When futures contracts or options thereon are purchased to protect
against a price increase on securities intended to be purchased later, it is
anticipated that at least 25% of such intended purchases will be completed.
When other futures contracts or options thereon are purchased, the underlying
value of such contracts will at all times not exceed the sum of: (1) accrued
profit on such contracts held by the broker; (2) cash or high quality money
market instruments set aside in an identifiable manner; and (3) cash proceeds
from investments due in 30 days.

Investment Restrictions
- -----------------------

Each Fund's investment objectives are fundamental policies and as such
may not be changed without a vote of the holders of a majority of that Fund's
outstanding Shares. In addition, the following investment restrictions of the
Funds may be changed only by a vote of a majority of the outstanding Shares of
a Fund (as defined under "ADDITIONAL INFORMATION - Vote of a Majority of the
Outstanding Shares" in this Statement of Additional Information).

Each of TCF and CGOF may not:

1. Purchase securities on margin, except for use of short-term
credit necessary for clearance of purchases of portfolio securities and except
as may be necessary to make margin payments in connection with derivative
securities transactions;

2. Underwrite the securities issued by other persons, except to
the extent that the Fund may be deemed to be an underwriter under certain
securities laws in the disposition of "restricted securities";

3. Purchase or sell real estate (although investments in
marketable securities of companies engaged in such activities and securities
secured by real estate or interests therein are not prohibited by this
restriction).

B-11
<PAGE> 102
4. Purchase or sell commodities or commodities contracts, except
to the extent disclosed in the current Prospectus of the Fund.

In addition, CGOF may not:

1. Purchase participations or other direct interests in oil, gas,
or other mineral exploration or development programs; or

2. Mortgage, pledge, hypothecate or, in any other manner,
transfer as security for indebtedness any security owned by a Fund, except as
may be necessary in connection with permissible borrowings, in which event such
mortgaging, pledging or hypothecating may not exceed 5% of the Fund's assets,
valued at cost and except that the deposit of assets in escrow in connection
with writing covered call options will not be deemed to be the mortgage,
pledge, hypothecation or transfer of assets as security described above.

CGSMMF will not:

1. Pledge, mortgage or hypothecate its assets, except that to
secure borrowings permitted for temporary or emergency non-investment
purposes, the Trust may pledge securities having a market value at the time of
pledge not exceeding 15% of its total assets (so long as certain state law
restrictions are applicable, the market value of securities subject to any such
pledge will not exceed 10% of the market value of the Trust's total assets);

3. Purchase or sell real estate or real estate mortgage loans;

4. Purchase commodities or commodities contracts;

5. Purchase participations or other direct interests in oil, gas
or other mineral exploration or development programs; or

6. Purchase securities on margin, except for use of short-term
credit necessary for clearance of purchases of portfolio securities.

CTEMMF will not:

1. Pledge, mortgage or hypothecate its assets, except that to
secure permitted borrowings it may pledge securities having a market value at
the time of pledge not exceeding 15% of the Trust's total assets; provided,
however, so long as certain state law

B-12
<PAGE> 103
restrictions are applicable, the market value of securities subject to any such
pledge will not exceed 10% of the market value of the Trust's total assets;

3. Purchase or sell real estate, although the Trust may invest in
Municipal Securities or temporary investments secured by interests in real
estate;

4. Purchase or sell commodities or commodity contracts;

5. Purchase securities on margin, except for use of short-term
credit necessary for clearance of purchases of portfolio securities;

6. Write, purchase or sell put or call options, except to the
extent that securities subject to a demand obligation or stand-by commitment
may be acquired;

7. Purchase participations or other direct interests in oil, gas,
or other mineral exploration or development programs; or

8. Purchase securities which are not Municipal Securities and the
income from which is subject to federal income tax, if such purchase would
cause more than 20% of the Trust's total assets to be invested in such
securities.

The following additional investment restrictions may be changed
without the majority vote of the outstanding Shares of any of the Funds. Each
Fund may not:

1. Purchase securities of other investment companies, except (a)
in connection with a merger, consolidation, acquisition or reorganization, and
(b) to the extent permitted by the 1940 Act or pursuant to any exemptions
therefrom;

2. Engage in any short sales; or

3. Invest more than 15% of the Fund's total assets in securities
which are restricted as to disposition.

In addition, TCF has the following nonfundamental investment
restrictions: (1) TCF may not purchase or retain securities of any issuer if,
to the knowledge of the Group, the officers and trustees of the Group and the
officers and directors of its investment adviser, who each own beneficially
more than 1/2 of 1% of the outstanding securities of such issuer together own
beneficially more than 5% of such securities, (2) mortgage or hypothecate the

B-13
<PAGE> 104

Fund's assets in excess of one-third of the Fund's total assets, (3) purchase
participations or direct interests in oil, gas or other mineral exploration or
development programs (although investments by the Fund in marketable securities
of companies engaged in such activities are not prohibited by this
restriction), or (4) invest more than 10% of the Fund's total assets in
securities of issuers which, together with any predecessors, have a record of
less than three years' continuous operation.

If a percentage restriction or requirement set forth above is met at
the time of investment, a later increase or decrease in such percentage
resulting from a change in net asset value will not be considered a violation
of the policy. However, should a change in net asset value or other external
events cause a Fund's investments in illiquid securities to exceed the
limitation in its non-fundamental policy as set forth in its Prospectus, the
Fund will act to cause the aggregate amount of illiquid securities to come
within such limit as soon as reasonably practicable. In such an event,
however, the Fund would not be required to liquidate any portfolio securities
where the Fund would suffer a loss on the sale of such securities.

The Group has represented to the California Department of Corporations
on behalf of each of the Funds that, in order to comply with applicable
regulations, each Fund may acquire or retain securities of other open-end
management investment companies only if such investments are made in open-end
management investment companies sold with no sales commission and the Fund's
investment adviser waives its management fee with respect to such investments.
The Group intends to comply with this undertaking with respect to a Fund for so
long as such Fund has its Shares registered for sale in the State of California
or such representation is required by the California Department of
Corporations.

Portfolio Turnover
- ------------------

The portfolio turnover rate for each Fund is calculated by dividing
the lesser of that Fund's purchases or sales of portfolio securities for the
year by the monthly average value of the portfolio securities. The Securities
and Exchange Commission (the "Commission") requires that the calculation
exclude all securities whose remaining maturities at the time of acquisition
were one year or less.

Because CGSMMF and CTEMMF intend to invest entirely in securities with
maturities of less than one year and because the Commission requires such
securities to be excluded from the calculation of portfolio turnover rate, the
portfolio turnover with respect to each of CGSMMF and CTEMMF is expected to be
zero percent for regulatory purposes. For each of the other Funds, the
portfolio turnover rate may vary greatly from year to year as well as within a
particular year, and may also be affected by cash

B-14
<PAGE> 105

requirements for redemptions of Shares. For the fiscal period ending September
30, 1996, the Group estimates that the portfolio turnover rate for each of TCF
and CGOF will not exceed 50%. Portfolio turnover will not be a limiting factor
in making investment decisions.

MANAGEMENT OF THE GROUP

The trustees and officers of the Group, together with their addresses
and principal business occupations and other affiliations during the last five
years, are shown below. Each person named as a trustee also serves as a
director of The Cardinal Fund Inc. and also serves as a trustee of Cardinal
Government Securities Trust, Cardinal Tax Exempt Money Trust and Cardinal
Government Obligations Fund. Each trustee who is an "interested person" of the
Group, as that term is defined in the 1940 Act, is indicated by an asterisk.

<TABLE>
<CAPTION>
Name, Business Position(s) Held Principal Occupation(s)
Address and Age with the Group During Past 5 Years
- --------------- ---------------- -----------------------
<S> <C> <C>
Gordon B. Carson Trustee, Member of Principal, Whitfield Robert
5413 Gardenbrook Drive Executive Committee Associates (construction consulting
Midland, Michigan 48642 firm) since 1988; formerly, Vice
Age: 84 President of Michigan Molecular
Institute (polymer science research
institute).

*H. Keith Allen Chairman and Trustee, Senior Executive Vice President and
155 East Broad Street Member of Executive, a Director of The Ohio Company
Columbus, Ohio 43215 Nominating and Investment (investment banking).
Age: 54 Committees

John B. Gerlach, Jr. Trustee, Member of Audit Since 1994, President and a
37 West Broad Street Committee Director of Lancaster Colony
Columbus, Ohio 43215 Corporation (diversified consumer
Age: 41 products); prior thereto, Executive
Vice President, Secretary and a
Director of Lancaster Colony
Corporation.

Michael J. Knilans Trustee, Member of Chairman, Ohio Bureau of Workers'
1119 Kingsdale Terrace Executive Committee Compensation.
Columbus, Ohio 43220
Age: 68

James I. Luck Trustee President, The Columbus Foundation
1234 East Broad Street (philanthropic public foundation).
Columbus, Ohio 43205
Age: 50
</TABLE>

B-15
<PAGE> 106
<TABLE>
<S> <C> <C>
David L. Nelson Trustee, Member of Audit Vice President, Customer
18 James Lane and Nominating Committees Satisfaction, Industry Segment, and
Stamford, CT 06903 former President, ABB Process
Age: 65 Automation Business of Asea Brown
Boveri, Inc. (designer and
manufacturer of process automation
systems for basic industries);
former President, Process
Automation Business, of Combustion
Engineering, Inc. (designer and
manufacturer of process automation
systems for basic industries).

*C. A. Peterson Trustee Retired; Chartered Financial
150 E. Wilson Bridge Rd. Analyst, former Senior Executive
Worthington, Ohio 43085 Vice President and Director of The
Age: 69 Ohio Company (investment banking).

Lawrence H. Rogers II Trustee Self-employed author; former Vice
4600 Drake Road Chairman, Motor Sports Enterprises,
Cincinnati, Ohio 45243 Inc.
Age: 74

*Frank W. Siegel President and Senior Vice President, The Ohio
155 East Broad Street Trustee, Member of Company (investment banking);
Columbus, Ohio 43215 Executive and Nominating former Vice President, Keystone
Age: 43 Committees Group (mutual fund
management/adminis-tration); former
Senior Vice President, Trust
Advisory Group (mutual fund
consulting).

Joseph H. Stegmayer Trustee, Member of Audit President and a Director of Clayton
724 Hampton Roads Dr. and Nominating Committees Homes, Inc. (manufactured homes);
Knoxville, TN 37922-4071 former Vice President, Treasurer,
Age: 44 Chief Financial Officer and a
Director of Worthington Industries,
Inc. (specialty steel and plastics
manufacturer).

Karen J. Hipsher Secretary Executive Secretary, The Ohio
155 East Broad Street Company (investment banking).
Columbus, Ohio 43215
Age: 50

James M. Schrack II Treasurer Vice President and Trust Officer of
155 East Broad Street The Ohio Company (investment
Columbus, Ohio 43215 banking).
Age: 37
</TABLE>
B-16

<PAGE> 107
<TABLE>
<S> <C> <C>
Bruce E. McKibben Assistant Since April, 1992,
155 East Broad Street Treasurer Employee of The Ohio
Columbus, Ohio 43215 Company (investment
Age: 26 banking); prior thereto,
student at The Ohio State
University.

</TABLE>
As of October 26, 1995, all trustees and officers of the Group as a
group owned fewer than one percent of the Shares of each Fund then outstanding.

Pursuant to the ultimate authority of the Board of Trustees of the
Group, the Executive Committee is responsible for the general management of the
affairs of the Group. This Committee's actions are reported to and reviewed by
the Board of Trustees.

Messrs. Allen and Siegel are Chairman, President and a director, and
Vice President and a director, respectively, of the Adviser, and Mr. Schrack is
a Vice President of the Adviser. The compensation of trustees and officers of
the Group who are employed by The Ohio Company is paid by The Ohio Company.
Trustees' fees plus expenses are paid by the Group, except that Messrs. Allen
and Siegel receive no fees from the Group.

The following table sets forth information regarding all compensation
paid by the Group to its Trustees for their services as trustees during the
fiscal year ended September 30, 1995. The Group has no pension or retirement
plans.

<TABLE>
<CAPTION>
COMPENSATION TABLE

Aggregate Total Compensation
Name and Position Compensation From the Group and
With the Group* From the Group the Fund Complex**
--------------- -------------- ------------------

<S> <C> <C>
Gordon B. Carson $2,000 $12,000
Trustee and Member of
Executive Committee

H. Keith Allen $ 0 $ 0
Chairman, Trustee and
Member of Executive,
Nominating and
Investment Committees

John B. Gerlach $2,000 $13,000
Trustee and Member of
Audit Committee

Michael J. Knilans $2,000 $12,000
Trustee and Member of
Executive Committee

</TABLE>
B-17

<PAGE> 108

Aggregate Total Compensation
Name and Position Compensation From the Group and
With the Group* From the Group the Fund Complex**
--------------- -------------- ------------------

<S> <C> <C>
James I. Luck $2,000 $12,000
Trustee

David L. Nelson $2,000 $13,000
Trustee and Member of
Audit and Nominating
Committees

C.A. Peterson $2,000 $12,000
Trustee

Lawrence H. Rogers, II $2,000 $12,000
Trustee

John L. Schlater $ 0 $ 0
Trustee

Frank W. Siegel $ 0 $ 0
Trustee, President and
Member of Executive and
Nominating Committees

Joseph H. Stegmayer $1,500 $10,000
Trustee and Member of
Audit and Nominating
Committees

<FN>

___________________________________
*During the fiscal year ended September 30, 1995, John L. Schlater, a
former officer of The Ohio Company and the Adviser, had served as a trustee of
the Group but no longer does so as of the date hereof. Mr. Schlater did not
receive any compensation from the Group or the Fund Complex.

**For purposes of this Table, Fund Complex means one or more mutual
funds, including the Group, which have a common investment adviser or
affiliated investment advisers or which hold themselves out to the public as
being related.

</TABLE>

PRINCIPAL SHAREHOLDERS OF THE GROUP

There were no persons known to the Group to be the beneficial owner of
more than 5% of any Fund's Shares or of the total number of the Group's shares
outstanding as of October 26, 1995.

THE ADVISER

The Group has entered into an Investment Advisory and Management
Agreement dated as of June 18, 1993, as amended January 10, 1996 (the
"Investment Advisory Agreement"), with Cardinal

B-18
<PAGE> 109
Management Corp. (the "Adviser"). Pursuant to the Investment Advisory
Agreement, the Adviser has agreed to provide investment advisory and management
services as described in the Prospectuses of the Funds. As compensation for
such services, facilities and expenses, the Adviser receives a fee (1) from
each of CGOF, CGSMMF and CTEMMF, computed and accrued daily and paid monthly,
based on an annual rate of .50% of the daily net asset value of that Fund and
(2) from TCF, computed and accrued daily and paid monthly, based on an annual
rate of 0.60% of the daily net asset value of TCF. In addition, the Adviser
also provides similar services to the other two funds of the Group, Cardinal
Balanced Fund ("CBF") and Cardinal Aggressive Growth Fund ("CAGF"), and
receives a fee from each such Fund, computed and accrued daily and paid
monthly, based on an annual rate of .75% of the daily net asset value of that
Fund. For the fiscal years ended September 30, 1995 and 1994, and the fiscal
period ended September 30, 1993, fees earned under the Investment Advisory
Agreement, with respect to CBF, were $101,585, $103,264 and $11,128,
respectively, and, with respect to CAGF, were $71,508, $66,792 and $5,058,
respectively.

The Adviser is a wholly owned subsidiary of The Ohio Company, an
investment banking firm organized in 1925. Descendants of H. P. and R. F.
Wolfe, deceased, and members of their families, through their possession of a
majority of the voting stock, may be considered controlling persons of The Ohio
Company. H. Keith Allen is an officer and director of The Ohio Company. Frank
W. Siegel, John L. Schlater, Hannibal L. Godwin III, and James M. Schrack II,
are each officers of The Ohio Company.

Unless sooner terminated, the Investment Advisory Agreement with respect
to a Fund continues for successive one-year periods ending June 18 of each year
if such continuance is approved at least annually by the Group's Board of
Trustees or by vote of a majority of the outstanding Shares of that Fund (as
defined under "ADDITIONAL INFORMATION -- Vote of a Majority of the Outstanding
Shares" below), and a majority of the Trustees who are not parties to the
Investment Advisory Agreement or interested persons (as defined in the 1940
Act) of any party to the Investment Advisory Agreement by votes cast in person
at a meeting called for such purpose. The Investment Advisory Agreement is
terminable as to a Fund at any time on 60 days' written notice without penalty
by the Trustees, by vote of a majority of the outstanding Shares of that Fund,
or by the Adviser. The Investment Advisory Agreement also terminates
automatically in the event of any assignment, as defined in the 1940 Act.

The Investment Advisory Agreement provides that the Adviser shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Group in connection with the performance of the Investment Advisory
Agreement, except a loss resulting from a breach of fiduciary duty with respect
to the receipt of compensation for services or a loss resulting from

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willful misfeasance, bad faith, or negligence on the part of the Adviser in the
performance of its duties, or from negligent disregard by the Adviser of its
duties and obligations thereunder.

PORTFOLIO TRANSACTIONS

Pursuant to the Investment Advisory Agreement, the Adviser, subject to
the policies established by the Board of Trustees of the Group and in
accordance with the Funds' investment restrictions and policies, is responsible
for each Fund's portfolio decisions and the placing of the Funds' portfolio
transactions. Purchases and sales of portfolio securities which are debt
securities usually are principal transactions in which such portfolio
securities are normally purchased directly from the issuer or from an
underwriter or market maker for the securities. Purchases from underwriters of
portfolio securities generally include a commission or concession paid by the
issuer to the underwriter, and purchases from dealers serving as market makers
may include the spread between the bid and asked price. Transactions on stock
exchanges involve the payment of negotiated brokerage commissions.
Transactions in the over-the-counter market are generally principal
transactions with dealers. With respect to the over-the-counter market, the
Group, where possible, will deal directly with dealers who make a market in the
securities involved except in those circumstances where better price and
execution are available elsewhere.

In executing such transactions, the Adviser seeks to obtain the best net
results for a Fund taking into account such factors as price (including the
applicable brokerage commission or dealer spread), size of order, difficulties
of execution and operational facilities of the firm involved and the firm's
risk in positioning a block of securities. While the Adviser generally seeks
reasonably competitive commission rates, for the reasons stated in the prior
sentence, a Fund will not necessarily be paying the lowest commission or spread
available.

The Adviser may consider provision of research, statistical and other
information to the Group, a Fund or the Adviser in the selection of qualified
broker-dealers who effect portfolio transactions for a Fund so long as the
Adviser's ability to obtain the best net results for portfolio transactions of
that Fund is not diminished. Such research services include supplemental
research, securities and economic analyses, and statistical services and
information with respect to the availability of securities or purchasers or
sellers of securities. Such research services may also be useful to the
Adviser in connection with its services to other clients. Similarly, research
services provided by brokers serving such other clients may be useful to the
Adviser in connection with its services to a Fund. Although this information
is useful to a Fund and the Adviser, except as described below, it is not
possible to place a dollar value on it. It is the opinion of the Board of
Trustees and the Adviser that the review and study

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of this information will not reduce the overall cost to the Adviser of
performing its duties to the Funds under the Investment Advisory Agreement.
The Adviser, on behalf of the Funds, may direct brokerage transactions to
Columbine Research in return for the provision of research services. Such
brokerage transactions are subject to the requirements as to price and
execution as described above. The Group is not authorized to pay brokerage
commissions which are in excess of those which another qualified broker would
charge solely by reason of brokerage and research services provided.

In addition, the Group has authorized the Adviser to place brokerage
transactions through Pershing and Company, a division of Donaldson, Lufkin &
Jenrette, in return for Lipper Data information prepared for the Group's
Trustees relating to information on fees and expenses of other mutual funds.
However, such brokerage transactions are subject to the requirements as to
execution and price described above.

Investment decisions for a Fund are made independently from those for
another Fund of the Group or any other investment company or account managed by
the Adviser. Any such other Funds, investment company or account may also
invest in the same securities as a Fund. When a purchase or sale of the same
security is made at substantially the same time on behalf of one Fund and
another Fund, investment company or account, the transaction will be averaged
as to price and available investments will be allocated as to amount in a
manner which the Adviser believes to be equitable to the Fund and such other
Fund, investment company or account. In some instances, this investment
procedure may adversely affect the price paid or received by a Fund or the size
of the position obtained by that Fund. To the extent permitted by law, the
Adviser may aggregate the securities to be sold or purchased for a Fund with
those to be sold or purchased for other funds or for other investment companies
or accounts in order to obtain best execution. As provided by the Investment
Advisory Agreement, in making investment recommendations for the Group, the
Adviser will not inquire or take into consideration whether an issuer of
securities proposed for purchase or sale by the Group is a customer of the
Adviser, its parent or its subsidiaries or affiliates and, in dealing with its
customers, the Adviser, its parent, subsidiaries and affiliates will not
inquire or take into consideration whether securities of such customers are
held by the Group.

Pursuant to Investment Advisory Agreement, the Adviser also serves as
general manager and administrator to each of the Funds. The Adviser assists in
supervising all operations of each Fund (other than those performed by The
Fifth Third Bank under the Custodian Agreement and by the Adviser under the
Transfer Agency and Fund Accounting Agreement).

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The Adviser has agreed to maintain office facilities; furnish
statistical and research data, clerical, certain bookkeeping services and
stationery and office supplies; prepare the periodic reports to the Commission
on Form N-SAR or any replacement forms therefor; compile data for, prepare for
execution by each Fund and file all of a Fund's federal and state tax returns
and required tax filings other than those required to be made by each Fund's
custodian and Transfer Agent; prepare compliance filings pursuant to state
securities laws with the advice of the Group's counsel; assist to the extent
requested by the Group with the Group's preparation of its Annual and
Semi-Annual Reports to Shareholders and its Registration Statement (on Form
N-1A or any replacement therefor); compile data for, prepare and file timely
Notices to the Commission required pursuant to Rule 24f-2 under the 1940 Act;
keep and maintain the financial accounts and records of each Fund, including
calculation of daily expense accruals; and generally assist in all aspects of
each Fund's operations.

TRANSFER AND DIVIDEND AGENT AND FUND ACCOUNTANT

The Group has entered into a Transfer Agency and Fund Accounting
Agreement dated as of June 18, 1993, as amended as of January 10, 1996 (the
"Transfer Agency Agreement"), with the Transfer Agent, pursuant to which the
Transfer Agent has agreed to act as the transfer agent, dividend disbursing
agent and administrator of plans for each Fund and to provide certain fund
accounting services for each Fund. Pursuant to the Transfer Agency Agreement,
the Transfer Agent, among other things, performs the following services in
connection with each Fund's shareholders of record: maintenance of shareholder
records for the Fund's shareholders of record; processing shareholder purchase
and redemption orders; processing transfers and exchanges of shares of the
Group on the shareholder files and records; processing dividend payments and
reinvestment; and assistance in the mailing of shareholder reports and proxy
solicitation materials. In consideration of such services each Fund has agreed
to pay the Transfer Agent monthly an annual fee equal to $21 per shareholder
account plus out-of-pocket expenses.

In addition, the Transfer Agency provides certain fund accounting
services to each of the Funds, including maintaining the accounting books and
records for each Fund, including journals containing an itemized daily record
of all purchases and sales of portfolio securities, all receipts and
disbursements of cash and all other debits and credits, general and auxiliary
ledgers reflecting all asset, liability, reserve, capital, income and expense
accounts, including interest accrued and interest received, and other required
separate ledger accounts; maintaining a monthly trial balance of all ledger
accounts; performing certain accounting services for each Fund, including
calculation of the net asset value per share, calculation of the dividend and
capital gain distributions, if any, and of yield, reconciliation of cash

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movements with such Fund's custodian, affirmation to that Fund's custodian of
all portfolio trades and cash settlements, verification and reconciliation with
that Fund's custodian of all daily trade activity; providing certain reports;
obtaining dealer quotations, prices from a pricing service or matrix prices on
all portfolio securities in order to mark the portfolio to the market; and
preparing an interim balance sheet, statement of income and expense, and
statement of changes in net assets for each Fund. In consideration for such
services, each Fund has agreed to pay the Transfer Agent a fee, computed daily
and paid periodically at an annual rate of .03% of such Fund's average daily
net assets.

EXPENSES

If total expenses borne by a Fund in any fiscal year exceed expense
limitations imposed by applicable state securities regulations, the Adviser
will reimburse that Fund by the amount of such excess. As of the date of this
Statement of Additional Information, the most restrictive expense limitation
applicable to the Funds limit each Fund's aggregate annual expenses, including
management and advisory fees but excluding interest, taxes, brokerage
commissions, and certain other expenses, to 2 1/2% of the first $30 million of
a Fund's average net assets, 2% of the next $70 million of such Fund's average
net assets, and 1 1/2% of such Fund's remaining average net assets. Any
expense reimbursements will be estimated daily and reconciled and paid on a
monthly basis.

THE DISTRIBUTOR

The Ohio Company serves as agent for the Funds in the distribution of
their Shares pursuant to a Distribution Agreement dated June 18, 1993, as
amended as of January 10, 1996 (the "Distribution Agreement"). Unless
otherwise terminated, the Distribution Agreement remains in effect for
successive annual periods ending on June 18 if approved at least annually (i)
by the Group's Board of Trustees or by the vote of a majority of the
outstanding shares of the Group, and (ii) by the vote of a majority of the
Trustees of the Group who are not parties to the Distribution Agreement or
interested persons (as defined in the 1940 Act) of any party to the
Distribution Agreement, cast in person at a meeting called for the purpose of
voting on such approval. The Distribution Agreement may be terminated in the
event of any assignment, as defined in the 1940 Act.

In its capacity as Distributor, The Ohio Company solicits orders for the
sale of Shares, advertises and pays the costs of advertising, office space and
the personnel involved in such activities. The Distributor receives no
compensation from the Group under the Distribution Agreement, but may receive
compensation under the Distribution and Shareholder Service Plan described
below and retain all or a portion of the sales charges with respect to its
sales of Shares of TCF and CGOF.

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As described in the Prospectus, the Group has adopted a Distribution and
Shareholder Service Plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act
under which each of TCF and CGOF (collectively, the "12b-1 Funds") is
authorized to pay The Ohio Company for payments it makes to broker-dealers,
including The Ohio Company, banks and other institutions (with all of the
foregoing organizations being referred to as "Participating Organizations") for
providing distribution or shareholder service assistance or for distribution
assistance and/or shareholder service provided by The Ohio Company pursuant to
an agreement between The Ohio Company and the Group. Payments to such
Participating Organizations may be made pursuant to agreements entered into
with The Ohio Company. The Plan authorizes each 12b-1 Fund to make payments to
The Ohio Company in an amount not in excess, on an annual basis, of 0.25% of
the average daily net asset value of that 12b-1 Fund.

As required by Rule 12b-1, the Plan was approved by the initial sole
shareholder of each 12b-1 Fund and by the Board of Trustees, including a
majority of the Trustees who are not interested persons of that 12b-1 Fund and
who have no direct or indirect financial interest in the operation of the Plan
(the "Independent Trustees"). The Plan may be terminated as to a 12b-1 Fund by
vote of a majority of the Independent Trustees, or by vote of majority of the
outstanding Shares of that 12b-1 Fund. Any change in the Plan that would
materially increase the distribution cost to a 12b-1 Fund requires shareholder
approval. The Trustees review quarterly a written report of such costs and the
purposes for which such costs have been incurred. The Plan may be amended by
vote of the Trustees, including a majority of the Independent Trustees, cast in
person at a meeting called for that purpose. For so long as the Plan is in
effect, selection and nomination of those Trustees who are not interested
persons of the Group shall be committed to the discretion of such disinterested
persons. All agreements with any person relating to the implementation of the
Plan with respect to a 12b-1 Fund may be terminated at any time on 60 days'
written notice without payment of any penalty, by vote of a majority of the
Independent Trustees or by a vote of the majority of the outstanding Shares of
such 12b-1 Fund.

The Plan will continue in effect for successive one-year periods,
provided that each such continuance is specifically approved (i) by the vote of
a majority of the Independent Trustees, and (ii) by a vote of a majority of the
entire Board of Trustees cast in person at a meeting called for that purpose.
The Board of Trustees has a duty to request and evaluate such information as
may be reasonably necessary for them to make an informed determination of
whether the Plan should be implemented or continued. In addition the Trustees
in approving the Plan must determine that there is a reasonable likelihood that
the Plan will benefit the 12b-1 Funds and their Shareholders.

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The Board of Trustees of the Group believes that the Plan is in the best
interests of the 12b-1 Funds since it encourages Fund growth and retention of
Fund assets. As a 12b-1 Fund grows in size, certain expenses, and therefore
total expenses per Share, may be reduced and overall performance per Share may
be improved.

As authorized by the Plan, the Group has entered into a Rule 12b-1
Agreement with The Ohio Company pursuant to which The Ohio Company has agreed
to provide certain shareholder services in connection with Shares of a 12b-1
Fund purchased and held by The Ohio Company for the accounts of its customers
and Shares of a 12b-1 Fund purchased and held by customers of The Ohio Company
directly, including, but not limited to, answering Shareholder questions
concerning the 12b-1 Funds, providing information to Shareholders on their
investments in the 12b-1 Funds and providing such personnel and communication
equipment as is necessary and appropriate to accomplish such matters. In
consideration of such services the Group, on behalf of each 12b-1 Fund, has
agreed to pay The Ohio Company a monthly fee, computed at the annual rate of
.25% of the average aggregate net asset value of Shares of that 12b-1 Fund held
during the period in customer accounts for which The Ohio Company has provided
services under this Agreement.

In addition, The Ohio Company may enter into, from time to time, Rule
12b-1 Agreements with selected dealers pursuant to which such dealers will
provide certain Shareholder services including, but not limited to, those
discussed above.

CUSTODIAN

The Fifth Third Bank, 38 Fountain Square Plaza, Cincinnati, Ohio 45263,
has been selected to serve as the Funds' custodian pursuant to the Custody
Agreement dated June 18, 1993, as amended as of January 10, 1996. In such
capacity the custodian will hold or arrange for the holding of all portfolio
securities and other assets of the Funds.

LEGAL COUNSEL AND INDEPENDENT AUDITORS

Baker & Hostetler, 65 East State Street, Columbus, Ohio 43215, is
counsel to the Group and will pass upon the legality of the Shares offered
thereby. The Group has selected KPMG Peat Marwick LLP, Two Nationwide Plaza,
Columbus, Ohio 43215, as independent auditors for the Funds.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

The Funds' Shares may be purchased at the public offering price and are
sold on a continuous basis through The Ohio Company, principal underwriter of
the Funds' Shares, at its address and number set forth on the cover page of
this Statement of Additional Information, and through other broker-dealers who
are members of

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the National Association of Securities Dealers, Inc. and have sales agreements
with The Ohio Company.

The Group may suspend the right of redemption or postpone the date of
payment for Shares during any period when (a) trading on the New York Stock
Exchange (the "Exchange") is restricted by applicable rules and regulations of
the Commission, (b) the Exchange is closed for other than customary weekend and
holiday closings, (c) the Commission has by order permitted such suspension, or
(d) an emergency exists as a result of which (i) disposal by the Group of
securities owned by it is not reasonably practical or (ii) it is not reasonably
practical for the Group to determine the fair value of its net assets.

Use of the check-writing redemption procedure will be subject to the
rules and regulations of The Fifth Third Bank (the "Bank") governing checking
accounts. Neither the Bank nor the Group shall incur any liability to a
participating shareholder under this procedure for not honoring a check that
exceeds the value of Shares in a shareholder's account, for honoring checks
properly drafted, for effecting redemptions pursuant to payment thereof or for
returning checks not accepted for payment. This procedure may be terminated at
any time by the Group, the Bank or the participating shareholder. A
shareholder participating in the check-writing redemption procedure has not
established a checking or other account with the Bank for the purposes of
Federal Deposit Insurance or otherwise.

Determination of Net Asset Value
- --------------------------------

The Group values the portfolio securities of CGSMMF and CTEMMF
(collectively, the "Money Market Funds" and individually a "Money Market Fund")
using the amortized cost valuation method. This method involves valuing a
security at its cost and thereafter accruing any discount or premium at a
constant rate to maturity. By declaring these accruals to the Money Market
Funds' shareholders in the daily dividend, the value of a Money Market Fund's
assets, and, thus, its net asset value per share, will generally remain
constant. Although this method provides certainty in valuation, it may result
in periods during which the value of a Money Market Fund's securities, as
determined by amortized cost, is higher or lower than the price the Money
Market Fund would receive if it sold the securities. During such periods, the
yield on Shares of the Money Market Fund may differ somewhat from that obtained
in a similar fund with identical investments utilizing a method of valuation
based upon market prices and estimates of market prices for all of its
portfolio securities. For example, if the use of amortized cost by a Money
Market Fund resulted in a lower aggregate portfolio value on a particular day,
a prospective investor in the Money Market Fund would be able to obtain a
somewhat higher yield than would result from investment in a similar fund
utilizing

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solely market values, and existing investors in the Money Market Fund would
receive less investment income.

The valuation of the Money Market Funds' portfolio securities based upon
their amortized cost and the maintenance of the Money Market Funds' per share
net asset value of $1.00 is permitted based on the Money Market Funds'
adherence to certain conditions, including maintaining a dollar-weighted
average portfolio maturity of 90 days or less and purchasing only portfolio
securities having remaining maturities of 397 days or less. The Board of
Trustees has also established procedures designed to stabilize, to the extent
reasonably possible, the Money Market Funds' net asset value per share, as
computed for the purpose of sales and redemptions, at $1.00. Such procedures
include review of the Money Market Funds' portfolio holdings by the Board of
Trustees at such intervals as it may deem appropriate to determine whether the
Money Market Funds' net asset value calculated by using available market
quotations deviates from $1.00 per Share and, if so, whether such deviation may
result in material dilution or may be otherwise unfair to existing
shareholders. These procedures also include a review by the Adviser in
accordance with policies established by the Board of Trustees not less
frequently than [monthly] of the quality of certain Municipal Securities having
variable interest rates and demand features that permit CTEMMF to calculate the
maturity of such obligations to a point in time prior to their stated maturity.
In the event the Board of Trustees determines that deviation in net asset value
exists, the Board of Trustees will take such corrective action as it deems
necessary and appropriate, which action might include redemption of Shares in
kind, selling portfolio securities prior to maturity to realize capital gains
or losses or to shorten average portfolio maturity, withholding dividends,
reduction of the number of Shares outstanding (i.e. the declaration of a
negative dividend) or establishing a net asset value per share by using
available market quotations.

TAXES

GENERAL. Each Fund intends to qualify as a "regulated investment
company" under the Code for so long as such qualification is in the best
interest of that Fund's shareholders. In order to qualify as a regulated
investment company, a Fund must, among other things: derive at least 90% of
its gross income from dividends, interest, payments with respect to securities
loans, and gains from the sale or other disposition of securities or foreign
currencies, or other income derived with respect to its business of investing
in such stocks, securities, or currencies; derive less than 30% of its gross
income from the sale or other disposition of stocks, securities, options,
future contracts or foreign currencies held less than three months; and
diversify its investments within certain prescribed limits. In addition, to
utilize the tax provisions specially applicable to regulated investment
companies, a Fund must distribute to its shareholders at least 90% of its

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investment company taxable income for the year. In general, a Fund's
investment company taxable income will be its taxable income subject to certain
adjustments and excluding the excess of any net long-term capital gain for the
taxable year over the net short-term capital loss, if any, for such year.

A non-deductible 4% excise tax is imposed on regulated investment
companies that do not distribute in each calendar year (regardless of whether
they otherwise have a non-calendar taxable year) an amount equal to 98% of
their ordinary income for the calendar year plus 98% of their capital gain net
income for the one-year period ending on October 31 of such calendar year. The
balance of such income must be distributed during the next calendar year. If
distributions during a calendar year were less than the required amount, such
Fund would be subject to a non-deductible excise tax equal to 4% of the
deficiency.

Although each Fund expects to qualify as a "regulated investment
company" and to be relieved of all or substantially all federal income taxes,
depending upon the extent of its activities in states and localities in which
its offices are maintained, in which its agents or independent contractors are
located, or in which it is otherwise deemed to be conducting business, a Fund
may be subject to the tax laws of such states or localities. In addition, if
for any taxable year a Fund does not qualify for the special tax treatment
afforded regulated investment companies, all of its taxable income will be
subject to federal tax at regular corporate rates (without any deduction for
distributions to its shareholders). In such event, dividend distributions
would be taxable to shareholders to the extent of earnings and profits, and
would be eligible for the dividends received deduction for corporations.

It is expected that each Fund will distribute annually to shareholders
all or substantially all of that Fund's net ordinary income and net realized
capital gains and that such distributed net ordinary income and distributed net
realized capital gains will be taxable income to shareholders for federal
income tax purposes, even if paid in additional Shares of the Fund and not in
cash.

Distribution by a Fund of the excess of net long-term capital gain over
net short-term capital loss is taxable to shareholders as long-term capital
gain in the year in which it is received, regardless of how long the
shareholder has held the Shares. Such distributions are not eligible for the
dividends-received deduction.

Federal taxable income of individuals is subject to graduated tax rates
of 15%, 28%, 31%, 36% and 39.6%. Further, the marginal tax rate may be in
excess of 39.6%, because adjustments reduce or eliminate the benefit of the
personal exemption and itemized

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deductions for individuals with gross income in excess of certain threshold
amounts.

Capital gains of individuals are subject to tax at the same rates
applicable to ordinary income; however, the tax rate on capital gains of
individuals cannot exceed 28%. Capital losses may be used to offset capital
gains. In addition, individuals may deduct up to $3,000 of net capital loss
each year to offset ordinary income. Excess net capital loss may be carried
forward to future years.

Federal taxable income of corporations in excess of $75,000 up to $10
million is subject to a 34% tax rate; however, because the benefit of lower tax
rates on a corporation's taxable income of less than $75,000 is phased out for
corporations with income in excess of $100,000 but lower than $335,000, a
maximum marginal tax rate of 39% may result. Federal taxable income of
corporations in excess of $10 million is subject to a tax rate of 35%.
Further, a corporation's federal taxable income in excess of $15 million is
subject to an additional tax equal to 3% of taxable income over $15 million,
but not more than $100,000.

Capital gains of corporations are subject to tax at the same rates
applicable to ordinary income. Capital losses may be used only to offset
capital gains and excess net capital loss may be carried back three years and
forward five years.

Certain corporations are entitled to a 70% dividends received deduction
for distributions from certain domestic corporations. Each Fund will designate
the portion of any distributions which qualify for the 70% dividends received
deduction. The amount so designated may not exceed the amount received by that
Fund for its taxable year that qualifies for the dividends received deduction.

A Fund will be required in certain cases to withhold and remit to the
United States Treasury 31% of taxable dividends paid to any shareholder who has
provided either an incorrect tax identification number or no number at all, or
who is subject to withholding by the Internal Revenue Service for failure
properly to include on his return payments of interest or dividends.

Information set forth in the Prospectuses and this Statement of
Additional Information which relates to federal taxation is only a summary of
some of the important federal tax considerations generally affecting purchasers
of Shares of a Fund. No attempt has been made to present a detailed
explanation of the federal income tax treatment of a Fund or its shareholders
and this discussion is not intended as a substitute for careful tax planning.
Accordingly, potential purchasers of Shares of a Fund are urged to consult
their tax advisers with specific reference to their own tax situation. In
addition, the tax discussion in the Prospectuses and this Statement of
Additional Information is based on tax laws and

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regulations which are in effect on the date of the Prospectuses and this
Statement of Additional Information; such laws and regulations may be changed
by legislative or administrative action.

SPECIFIC INFORMATION REGARDING CTEMMF. An exempt-interest dividend
is any dividend or part thereof (other than a capital gain dividend) paid by
CTEMMF that is derived from interest received by CTEMMF that is excluded from
gross income for federal income tax purposes, net of certain deductions,
provided the dividend is designated as an exempt-interest dividend in a written
notice mailed to shareholders not later than sixty days after the close of
CTEMMF's taxable year. The percentage of the total dividends paid by CTEMMF
during any taxable year that qualifies as exempt-interest dividends will be the
same for all shareholders receiving dividends during such year.
Exempt-interest dividends shall be treated by CTEMMF's shareholders as items of
interest excludable from their gross income for Federal income tax purposes
under Section 103(a) of the Code. However, a shareholder is advised to consult
his tax adviser with respect to whether exempt-interest dividends retain the
exclusion under Section 103(a) of the Code if such shareholder is a
"substantial user" or a "related person" to such user under Section 147(a) of
the Code with respect to any of the Municipal Securities held by CTEMMF. If a
shareholder receives an exempt-interest dividend with respect to any Share and
such Share is held by the shareholder for six months or less, any loss on the
sale or exchange of such Share shall be disallowed to the extent of the amount
of such exempt-interest dividend.

In general, interest on indebtedness incurred or continued by a
shareholder to purchase or carry Shares of CTEMMF is not deductible for federal
income tax purposes if CTEMMF distributes exempt-interest dividends during the
shareholder's taxable year. A shareholder of CTEMMF that is a financial
institution may not deduct interest expense attributable to indebtedness
incurred or continued to purchase or carry Shares of CTEMMF if CTEMMF
distributes exempt-interest dividends during the shareholder's taxable year
(except that 80% in the case of interest expense attributable to tax-exempt
obligations acquired after December 31, 1982, and prior to August 7, 1986 may
be deducted). Certain federal income tax deductions of property and casualty
insurance companies holding Shares of CTEMMF and receiving exempt-interest
dividends may also be adversely affected. In certain limited instances, the
portion of Social Security benefits received by a shareholder which may be
subject to federal income tax may be affected by the amount of tax-exempt
interest income, including exempt-interest dividends received by shareholders
of CTEMMF.

In the unlikely event CTEMMF realizes long-term capital gains, CTEMMF
intends to distribute any realized net long-term capital gains annually. If
CTEMMF distributes such gains, CTEMMF will have no tax liability with respect
to such gains, and the distributions will be taxable to shareholders as
long-term capital gains

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regardless of how long the shareholders have held the Shares. Any such
distributions will be designated as a capital gain dividend in a written notice
mailed by CTEMMF to the shareholders not later than sixty days after the close
of CTEMMF's taxable year. It should be noted, however, that capital gains are
taxed like ordinary income except that net capital gains of individuals are
subject to a maximum federal income tax rate of 28%. Net capital gains are the
excess of net long-term capital gains over net short-term capital losses. Any
net short-term capital gains are taxed at ordinary income tax rates. If a
shareholder receives a capital gain dividend with respect to any Share and then
sells the Share before he has held it for more than six months, any loss on the
sale of the Share is treated as long-term capital loss to the extent of the
capital gain dividend received.

Interest earned by individuals and corporations on certain municipal
obligations issued on or after August 8, 1986, to finance certain private
activities will be treated as a tax preference item in computing the
alternative minimum tax. It is likely that exempt-interest dividends received
by shareholders from CTEMMF will also be treated as tax preference items in
computing the alternative minimum tax to the extent that distributions by
CTEMMF are attributable to such obligations. Also, a portion of all other
interest excluded from gross income for federal income tax purposes earned by a
corporation may be subject to the alternative minimum tax as a result of the
inclusion in alternative minimum taxable income of 75% of the excess of
adjusted current earnings and profits over pre-book alternative minimum taxable
income. Adjusted current earnings and profits would include exempt-interest
dividends distributed by CTEMMF to corporate shareholders.

For taxable years of corporations beginning before 1996, the Superfund
Revenue Act of 1986 imposes an additional tax (which is deductible for federal
income tax purposes) on a corporation at a rate of 0.12 of one percent on the
excess over $2,000,000 of such corporation's "modified alternative minimum
taxable income," which would include a portion of the exempt-interest dividends
distributed by CTEMMF to such corporation, and exempt-interest dividends
distributed to certain foreign corporations doing business in the United States
could be subject to a branch profits tax imposed by Section 884 of the Code.

Distributions of exempt-interest dividends by CTEMMF may be subject to
state and local taxes even though a substantial portion of such distributions
may be derived from interest on obligations which, if received directly, would
be exempt from such taxes. CTEMMF will report to its shareholders annually
after the close of its taxable year the percentage and source, on a
state-by-state basis, of interest income earned on municipal obligations held
by CTEMMF during the preceding year. Shareholders are advised to consult their
tax advisers concerning the application of state and local taxes.

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ADDITIONAL INFORMATION

Description of Shares
- ---------------------

The Group is an Ohio business trust. The Group was organized on March
23, 1993, and the Group's Declaration of Trust was filed with the Secretary of
State of Ohio on March 23, 1993. The Declaration of Trust authorizes the Board
of Trustees to issue an unlimited number of Shares, which are units of
beneficial interest, without par value. The Group presently has six series of
Shares, four of which represent interests in the Funds. The Group's
Declaration of Trust authorizes the Board of Trustees to divide or redivide any
unissued Shares of the Group into one or more additional series by setting or
changing in any one or more respects their respective preferences, conversion
or other rights, voting power, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption.

Shares have no subscription or preemptive rights and only such
conversion or exchange rights as the Board of Trustees may grant in its
discretion. When issued for payment as described in the respective Prospectus
and this Statement of Additional Information, a Fund's Shares will be fully
paid and non-assessable. In the event of a liquidation or dissolution of the
Group, shareholders of a Fund are entitled to receive the assets available for
distribution belonging to that Fund, and a proportionate distribution, based
upon the relative asset values of the respective Fund, of any general assets
not belonging to any particular Fund which are available for distribution.

Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted to the holders of the outstanding voting securities of an investment
company such as the Group shall not be deemed to have been effectively acted
upon unless approved by the holders of a majority of the outstanding shares of
each series affected by the matter. For purposes of determining whether the
approval of a majority of the outstanding shares of a series will be required
in connection with a matter, a series will be deemed to be affected by a matter
unless it is clear that the interests of each series in the matter are
identical, or that the matter does not affect any interest of the series.
Under Rule 18f-2, the approval of any amendment to the Investment Advisory
Agreement or any change in investment policy submitted to shareholders would be
effectively acted upon with respect to a series only if approved by a majority
of the outstanding shares of such series. However, Rule 18f-2 also provides
that the ratification of independent public accountants and the election of
Trustees may be effectively acted upon by shareholders of the Group voting
without regard to series.

B-32
<PAGE> 123
Vote of a Majority of the Outstanding Shares
- --------------------------------------------

As used in the Prospectuses and this Statement of Additional
Information, "vote of a majority of the outstanding Shares" of the Group or a
Fund, means the affirmative vote, at an annual or special meeting of
shareholders duly called, of the lesser of (a) 67% or more of the votes of
shareholders of the Group or that Fund present at such meeting at which the
holders of more than 50% of the votes attributable to the shareholders of
record of the Group or that Fund are represented in person or by proxy, or (b)
the holders of more than 50% of the outstanding votes of shareholders of the
Group or such Fund.

Miscellaneous
- -------------

Individual Trustees are elected by the Shareholders and, subject to
removal by the vote of two-thirds of the Board of Trustees, serve for a term
lasting until the next meeting of shareholders at which Trustees are elected.
Such meetings are not required to be held at any specific intervals.
Generally, shareholders owning not less than 20% of the outstanding shares of
the Group entitled to vote may cause the Trustees to call a special meeting.
However, the Group has represented to the Commission that the Trustees will
call a special meeting for the purpose of considering the removal of one or
more Trustees upon written request therefor from shareholders owning not less
than 10% of the outstanding votes of the Group entitled to vote and that the
Group will assist in communications with other shareholders as required by
Section 16(c) of the 1940 Act. At such a meeting, a quorum of shareholders
(constituting a majority of votes attributable to all outstanding shares of the
Group), by majority vote, has the power to remove one or more Trustees.

The Group is registered with the Commission as a management investment
company. Such registration does not involve supervision by the Commission of
the management or policies of the Group.

The Prospectuses and this Statement of Additional Information omit
certain of the information contained in the Registration Statement filed with
the Commission. Copies of such information may be obtained from the Commission
upon payment of the prescribed fee.

The Prospectuses and this Statement of Additional Information are not an
offering of the securities herein described in any state in which such offering
may not lawfully be made. No salesman, dealer, or other person is authorized
to give any information or make any representation other than those contained
in the Prospectuses and this Statement of Additional Information.

B-33
<PAGE> 124
PERFORMANCE INFORMATION

Yields
- ------
The yield of TCF and CGOF will be computed by annualizing net investment
income per share for a recent 30-day period and dividing that amount by a
Share's maximum offering price (as of the date hereof, 4.5%) (reduced by any
undeclared earned income expected to be paid shortly as a dividend) on the last
trading day of that period. Net investment income will reflect amortization of
any market value premium or discount of fixed income securities (except for
obligations backed by mortgages or other assets) and may include recognition of
a pro rata portion of the stated dividend rate of dividend paying portfolio
securities. The yield of TCF and CGOF will vary from time to time depending
upon market conditions, the composition of such Fund's portfolio and operating
expenses of the Group allocated to that Fund. These factors and possible
differences in the methods used in calculating yield should be considered when
comparing TCF's or CGOF's yield to yields published for other investment
companies and other investment vehicles. Yield should also be considered
relative to changes in the value of TCF's and CGOF's Shares and to the relative
risks associated with the investment objectives and policies of those Funds.

The current (average annualized) yield of CGSMMF and CTEMMF for any
seven-day period is calculated by dividing the average daily net income per
Share earned by that Fund during the seven-day calendar period by such Fund's
average price per Share over the same period and annualizing this quotient on a
365 day basis. For purposes of this calculation, the daily net income reflects
dividends declared on the original Share and dividends declared on any Shares
purchased with dividends on that Share. Capital changes that are excluded from
the calculation are realized gains and losses from the sale of securities as
well as unrealized appreciation and depreciation with respect to the Fund's
portfolio.

The effective or compounded yield of CGSMMF and CTEMMF for any seven-day
period is computed by adding the number one to the daily net income per Share
earned by such Fund during the seven-day calendar period, raising the sum to a
power equal to 365 divided by seven, and subtracting the number one from the
result.

CTEMMF's tax-equivalent yield is computed by dividing that portion of
CTEMMF's yield which is tax-exempt by 1 minus the stated income tax rate and
adding the result to that portion, if any, of CTEMMF's yield that is not
tax-exempt. CTEMMF's tax-equivalent effective yield is computed by dividing
that portion of the effective yield which is tax-exempt by 1 minus the stated
income tax rate and adding to that result the portion, if any, of CTEMMF's
effective yield that is not tax-exempt.

B-34
<PAGE> 125
Calculation of Total Return
- ---------------------------

Each quotation of average annual total return will be computed by
finding the average annual compounded rate of return over that period which
would equate the value of an initial amount of $1,000 invested in a Fund equal
to the ending redeemable value, according to the following formula:

P(T + 1)n = ERV

Where: P = a hypothetical initial payment of $1,000, T = average annual
total return, n = number of years, and ERV = ending redeemable value of a
hypothetical $1,000 payment at the beginning of the period at the end of the
period for which average annual total return is being calculated assuming a
complete redemption. The calculation of average annual total return assumes
the deduction of the maximum sales charge from the initial investment of
$1,000, assumes the reinvestment of all dividends and distributions at the
price stated in the then effective Prospectus on the reinvestment dates during
the period and includes all recurring fees that are charged to all shareholder
accounts assuming such Fund's average account size. Cumulative return is
computed by using average annual total return, as calculated above, for each
year of the relevant period to determine the total return on a hypothetical
initial investment of $1,000 over such period.

In addition, as described in CGOF's Prospectus, from time to time CGOF
may include in its sales literature and shareholder reports a quote of a
current "distribution" rate. The current distribution rate is computed by
dividing the total amount of dividends per share paid by CGOF during the past
twelve months by a current maximum offering price. Under certain
circumstances, such as when there has been a change in the amount of dividend
payout, or a fundamental change in investment policies, it might be appropriate
to annualize the dividends paid over the period such changed policies were in
effect, rather than using the dividends during the past twelve months. The
current distribution rate differs from the current yield computation because it
may include distributions to shareholders from sources other than dividends and
interest, such as premium income from option writing, short-term capital gains
and net equalization credits and is calculated over a different period of time.

At any time in the future, yields and total return may be higher or
lower than past yields and total return and there can be no assurance that any
historical results will continue. Investors in the Funds are specifically
advised that Share prices of TCF and CGOF, expressed as the net asset values
per share, will vary just as yields and total return will vary.

B-35
<PAGE> 126
Performance Comparisons
- -----------------------

Investors may also judge the performance of a Fund by comparing its
performance to the performance of other mutual funds or mutual fund portfolios
with comparable investment objectives and policies through various mutual fund
or market indices such as those prepared by Dow Jones & Co., Inc. and, Standard
& Poor's Corporation and to data prepared by Lipper Analytical Services, Inc.,
Morningstar, Inc. and CDA Investment Technologies, Inc. Comparisons may also
be made to indices or data published in Donoghue's MONEY FUND REPORT of
Holliston, Massachusetts, a nationally recognized money market fund reporting
service, Money Magazine, Forbes, Barron's, The Wall Street Journal, The New
York Times, The Columbus Dispatch, Business Week, U.S.A. Today and Consumer
Reports. In addition to performance information, general information about the
Funds that appears in a publication such as those mentioned above may be
included in advertisements and in reports to shareholders.

B-36
<PAGE> 127

APPENDIX

COMMERCIAL PAPER RATINGS. Commercial paper ratings of Standard & Poor's
Corporation ("S&P") are current assessments of the likelihood of timely payment
of debts having original maturities of no more than 365 days. Commercial paper
rated A-1 by S&P indicates that the degree of safety regarding timely payment
is either overwhelming or very strong. Those issues determined to possess
overwhelming safety characteristics are denoted A-1+. Commercial paper rated
A-2 by S&P indicates that capacity for timely payment on issues is strong.
However, the relative degree of safety is not as high as for issues designated
A-1.

The rating Prime-1 is the highest commercial paper rating assigned by
Moody's Investors Service, Inc. ("Moody's"). Issuers rated Prime-1 (or related
supporting institutions) are considered to have a superior capacity for
repayment of short-term promissory obligations. 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 of Prime-1 rated issuers, but to a lesser degree. Earnings
trends and coverage ratios, while sound, will be more subject to variations.
Capitalization characteristics, while still appropriate, may be more affected
by external conditions. Ample alternative liquidity is maintained.

Commercial paper rated F-1 by Fitch Investors Service ("Fitch") is
regarded as having the strongest degree of assurance for timely payments.
Commercial paper rated F-2 by Fitch is regarded as having an assurance of
timely payment only slightly less than the strongest rating, I.E., F-1.

The plus (+) sign is used after a rating symbol to designate the
relative position of an issuer within the rating category.

CORPORATE DEBT RATINGS. A S&P corporate debt rating is a current
assessment of the creditworthiness of an obligor with respect to a specific
obligation. Debt rated AAA has the highest rating assigned by S&P. Capacity
to pay interest and repay principal is extremely strong. Debt rated AA has a
very strong capacity to pay interest and to repay principal and differs from
the highest rated issues only in small degree. Debt rated A has a strong
capacity to pay interest and repay principal although it is somewhat more
susceptible to adverse effects of changes in circumstances and economic
conditions than debt in higher rated categories. 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.

A-1
<PAGE> 128
The following summarizes the four highest ratings used by Moody's for
corporate debt. Bonds that are rated Aaa by Moody's 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. Bonds that 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. Bonds that are rated A by Moody's 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 some time in the future. Bonds that are rated Baa by Moody's 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.

Moody's applies numerical modifiers (1, 2, and 3) with respect to bonds
rated Aa through Baa. The modifier 1 indicates that the bond being rated 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 bond ranks in the
lower end of its generic rating category.

The following summarizes the four highest long-term debt ratings by
Duff. Debt rated AAA has the highest credit quality. The risk factors are
negligible being only slightly more than for risk-free U.S. Treasury debt.
Debt rated AA has a high credit quality and protection factors are strong.
Risk is modest but may vary slightly from time to time because of economic
conditions. Debt rated A has protection factors that are average but adequate.
However, risk factors are more variable and greater in periods of economic
stress. Debt rated BBB has below average protection factors but is still
considered sufficient for prudent investment. However, there is considerable
variability in risk during economic cycles.

To provide more detailed indications of credit quality, the ratings from
AA to BBB may be modified by the addition of a plus or

A-2
<PAGE> 129
minus sign to show relative standing within this major rating category.

The following summarizes the four highest long-term debt ratings by
Fitch (except for AAA ratings, plus or minus signs are used with a rating
symbol to indicate the relative position of the credit within the rating
category). Bonds rated AAA are 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. Bonds rated AA are 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 issues
is generally rated "F-1+." Bonds rated as A are 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. Bonds rated BBB are 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
for these bonds will fall below investment grade is higher than for bonds with
higher ratings.

The following summarizes IBCA's four highest long-term debt ratings.
Obligations rated AAA are those for which there is the lowest expectation of
investment risk. Capacity for timely repayment of principal and interest is
substantial, such that adverse changes in business, economic or financial
conditions are unlikely to increase investment risk significantly. Obligations
rated AA are those for which there is a very low expectation of investment
risk. Capacity for timely repayment of principal and interest is substantial.
Adverse changes in business, economic, or financial conditions may increase
investment risk albeit not very significantly. Obligations rated A are those
for which there is a low expectation of investment risk. Capacity for timely
repayment of principal and interest is strong, although adverse changes in
business, economic or financial conditions may lead to increased investment
risk. Obligations rated BBB are those for which there is currently a low
expectation of investment risk. Capacity for timely repayment of principal and
interest is adequate, although adverse changes in business, economic, or
financial conditions are more likely to lead to increased investment risk than
for obligations in other categories.

A-3
<PAGE> 130
The following summarizes Thomson's description of its four highest
long-term debt ratings (Thomson may include a plus (+) or minus (-) designation
to indicate where within the respective category the issue is placed). AAA is
the highest category and indicates that the ability to repay principal and
interest on a timely basis is very high. AA is the second highest category and
indicates a superior ability to repay principal and interest on a timely basis
with limited incremental risk versus issues rated in the highest category. A
is the third highest category and indicates the ability to repay principal and
interest is strong. Issues rated "A" could be more vulnerable to adverse
developments (both internal and external) than obligations with higher ratings.
BBB is the lowest investment grade category and indicates an acceptable
capacity to repay principal and interest. Issues rated "BBB" are, however,
more vulnerable to adverse developments (both internal and external) than
obligations with higher ratings.

Definitions of Certain Money Market Instruments
- -----------------------------------------------

Commercial Paper

Commercial paper consists of unsecured promissory notes issued by
corporations. Issues of commercial paper normally have maturities of less than
nine months and fixed rates of return.

Certificates of Deposit

Certificates of Deposit are negotiable certificates issued against funds
deposited in a commercial bank or a savings and loan association for a definite
period of time and earning a specified return.

Bankers' Acceptances

Bankers' acceptances are negotiable drafts or bills of exchange,
normally drawn by an importer or exporter to pay for specific merchandise,
which are "accepted" by a bank, meaning, in effect, that the bank
unconditionally agrees to pay the face value of the instrument on maturity.

U.S. Treasury Obligations

U.S. Treasury Obligations are obligations issued or guaranteed as to
payment of principal and interest by the full faith and credit of the U.S.
Government. These obligations may include Treasury bills, notes and bonds, and
issues of agencies and instrumentalities of the U.S. Government, provided such
obligations are guaranteed as to payment of principal and interest by the full
faith and credit of the U.S. Government.

A-4
<PAGE> 131
U.S. Government Agency and Instrumentality Obligations

Obligations of the U.S. Government include Treasury bills, certificates
of indebtedness, notes and bonds, and issues of agencies and instrumentalities
of the U.S. Government, such as the Government National Mortgage Association,
the Export-Import Bank of the United States, the Tennessee Valley Authority,
the Farmers Home Administration, the Federal Home Loan Banks, the Federal
Intermediate Credit Banks, the Federal Farm Credit Banks, the Federal Land
Banks, the Federal Housing Administration, the Federal National Mortgage
Association, the Federal Home Loan Mortgage Corporation, and the Student Loan
Marketing Association. Some of these obligations, such as those of the
Government National Mortgage Association and the Export-Import Bank of the
United States, are supported by the full faith and credit of the U.S. Treasury;
others, such as those of the Federal National Mortgage Association, are
supported by the right of the issuer to borrow from the Treasury; others, such
as those of the Student Loan Marketing Association, are supported by the
discretionary authority of the U.S. Government to purchase the agency's
obligations; still others, such as those of the Federal Farm Credit Banks, are
supported only by the credit of the instrumentality. No assurance can be given
that the U.S. Government would provide financial support to U.S.
Government-sponsored instrumentalities if it is not obligated to do so by law.

A-5