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SIGNATURE PAUL SCHUBERT
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000907015
<NAME> MANAGED HIGH YIELD FUND INC.
<MULTIPLIER> 1000
<S> <C>
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</TABLE>
Report to Independent Auditors
To the Shareholders and Board of Directors of
Managed High Yield Fund Inc.
In planning and performing our audit of the financial statements of Managed
High Yield Fund, Inc. for the year ended July 31, 1997, we considered its
internal control, including control activities for safeguarding securities, in
order to determine our auditing procedures for the purpose of expressing our
opinion on the financial statements and to comply with the requirements of Form
N-SAR, not to provide assurance on the internal control.
The management of Managed High Yield Fund, Inc. is responsible for stablishing
and maintaining internal control. In fulfilling this esponsibility, estimates
and judgments by management are required to assess the expected benefits and
related costs of controls. Generally, controls that are relevant to an audit
pertain to the entity's objective of preparing financial statements for external
purposes that are fairly presented in conformity with generally accepted
accounting principles. Those controls include the safeguarding of assets
against unauthorized acquisition, use or disposition.
Because of inherent limitations in internal control, errors or irregularities
may occur and not be detected. Also, projection of any evaluation of internal
control to future periods is subject to the risk that it may become inadequate
because of changes in conditions or that the effectiveness of the design and
operation may deteriorate.
Our consideration of the internal control would not necessarily disclose all
matters in the internal control that might be material weaknesses under
standards established by the American Institute of Certified Public Accountants.
A material weakness is a condition in which the design or operation of one or
more of the internal control components does not reduce to a relatively low
level the risk that errors or irregularities in amounts that would be material
in relation to the financial statements being audited may occur and not be
detected within a timely period by employees in the normal course of performing
their assigned functions. However, we noted no matters involving the internal
control and its operation, including controls for safeguarding securities, that
we consider to be material weaknesses as defined above at July 31, 1997.
This report is intended solely for the information and use of the board of
directors and management of Managed High Yield Fund, Inc. and the Securities and
Exchange Commission.
ERNST & YOUNG LLP
New York, New York
September 19, 1997
