MASTER INVESTMENT PORTFOLIO, POS AMI, 1996-06-28

MASTER INVESTMENT PORTFOLIO
POS AMI, 1996-06-28

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<PAGE> 1

As filed with the Securities and Exchange Commission
on June 28, 1996

Registration No. 811-8162

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

FORM N-1A

AMENDMENT NO. 4 TO THE
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940

MASTER INVESTMENT PORTFOLIO
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

111 Center Street, Little Rock, Arkansas 72201
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES, INCLUDING ZIP CODE)

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

Registrant's Telephone Number, including Area Code:
(800) 643-9691

Richard H. Blank, Jr.
c/o Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
(NAME AND ADDRESS OF AGENT FOR SERVICE)

WITH A COPY TO:
Robert M. Kurucza, Esq.
Marco E. Adelfio, Esq.
Morrison & Foerster LLP
2000 Pennsylvania Avenue, N.W., Suite 5500
Washington, D.C. 20006-1812
<PAGE> 2

EXPLANATORY NOTE

This amendment is being filed to add to the Master Investment
Portfolio Registration Statement the audited financial statements and certain
related financial information for the fiscal year ended February 29, 1996 for
the LifePath 2000, LifePath 2010, LifePath 2020, LifePath 2030, LifePath 2040,
Asset Allocation, Bond Index, S&P 500 Index and U.S. Treasury Allocation Master
Portfolios, and to add certain other non-material changes to the Registration
Statement.

This Amendment to the Registration Statement has been filed by the
Registrant pursuant to Section 8(b) of the Investment Company Act of 1940.
However, beneficial interests in the Registrant are not being registered under
the Securities Act of 1933 (the "1933 Act") because such interests will be
issued solely in private placement transactions that do not involve any "public
offering" within the meaning of Section 4(2) of the 1933 Act. Investments in
the Registrant may only be made by registered broker/dealers or by investment
companies, insurance company separate accounts, common commingled trust funds,
group trusts or similar organizations or entities that are "accredited
investors" within the meaning of Regulation D under the 1933 Act. This
Registration Statement does not constitute an offer to sell, or the
solicitation of an offer to buy, any beneficial interest in the Registrant.
<PAGE> 3

Master Investment Portfolio
Cross Reference Sheet

Form N-1A Item Number

<TABLE>
<S> <C>
Part A Prospectus Caption
- ------ ------------------

4 General Description of Registrant; Investment Objectives; Introduction; Management
Policies; Fundamental Policies; Non-Fundamental Policies; Risk Factors
5 Management of the Master Portfolios; Investment Adviser and Sub-Investment Adviser;
Administrator and Placement Agent; Custodian and Transfer Agent; Expenses
6 Capital Stock and Other Securities
7 Purchase of Securities
8 Redemption or Repurchase
9 Not Applicable

Part B Statement of Additional Information
- ------ -----------------------------------

10 Cover Page
11 Table of Contents
12 Not Applicable
13 Investment Objectives and Policies; Portfolio Securities; Management Policies; Investment
Restrictions
14 Management of MIP
15 Control Persons and Principal Holders of Securities
16 Investment Advisory and Other Services; Custodian, Transfer and Dividend Disbursing Agent;
Administrator; Distributor
17 Brokerage Allocation and Other Practices
18 Capital Stock and Other Securities
19 Purchase, Redemption and Pricing of Securities
20 Tax Status
21 Underwriters
22 Calculation of Performance Data
23 Financial Information

Part C Other Information
- ------ -----------------

24-32 Information required to be included in Part C is set forth under the appropriate Item, so
numbered, in Part C of this Document.
</TABLE>
<PAGE> 4
MASTER INVESTMENT PORTFOLIO
LIFEPATH(TM) MASTER PORTFOLIOS

LIFEPATH 2000 MASTER PORTFOLIO
LIFEPATH 2010 MASTER PORTFOLIO
LIFEPATH 2020 MASTER PORTFOLIO
LIFEPATH 2030 MASTER PORTFOLIO
LIFEPATH 2040 MASTER PORTFOLIO

PART A

June 28, 1996

Responses to Items 1 through 3 have been omitted pursuant to paragraph 4 of
Instruction F of the General Instructions to Form N-1A.

Item 4. General Description of Registrant.

GENERAL. Master Investment Portfolio ("MIP") is an open-end, management
investment company, organized on October 21, 1993 as a business trust under the
laws of the State of Delaware. MIP is a "series fund," which is a mutual fund
divided into separate portfolios. By this offering document, MIP is offering
five asset allocation portfolios (each, a "Master Portfolio" or "LifePath
Master Portfolio"). Each LifePath Master Portfolio is treated as a separate
entity for certain matters under the Investment Company Act of 1940, as amended
(the "1940 Act"), and for other purposes and an interestholder of one LifePath
Master Portfolio is not deemed to be an interestholder of any other LifePath
Master Portfolio. As described below, for certain matters MIP interestholders
vote together as a group; as to others they vote separately by Master
Portfolio. MIP currently offers four other series pursuant to other offering
documents. From time to time, other series may be established and sold
pursuant to other offering documents.

BZW Barclays Global Fund Advisors ("BGFA") serves as investment
adviser to each LifePath Master Portfolio. Prior to January 1, 1996, Wells
Fargo Bank, N.A. ("Wells Fargo Bank") served as each LifePath Master
Portfolio's investment adviser and Wells Fargo Nikko Investment Advisors
("WFNIA") served as each LifePath Master Portfolio's sub- investment adviser.
The LifePath Master Portfolios do not currently retain a sub-adviser. BGFA was
created by the reorganization of WFNIA with and into Wells Fargo Institutional
Trust Company ("WFITC"). BGFA is now a subsidiary of WFITC which, effective
January 1, 1996, changed its name to BZW Barclays Global Investors, N.A.
("BGI").

Beneficial interests in each Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering"
within the meaning of Regulation D under the Securities Act of 1933, as amended
(the "1933 Act"). Investments in a Master Portfolio may be made only by
investment companies or other accredited investors within the meaning of
Regulation D under the 1933 Act. This registration statement does not
constitute an offer to sell,

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or the solicitation of an offer to buy, any "security" within the meaning of
the 1933 Act. Organizations or other entities that hold shares of beneficial
interest of a Master Portfolio may be referred to herein as "feeder funds."

INVESTMENT OBJECTIVES. Each Master Portfolio seeks to provide long-term
investors in a feeder fund with an asset allocation strategy designed to
maximize assets for retirement or for other purposes consistent with the
quantitatively measured risk such investors, on average, may be willing to
accept given their investment time horizons. Specifically:

o LIFEPATH 2000 MASTER PORTFOLIO is managed for investors in a
feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2000.

o LIFEPATH 2010 MASTER PORTFOLIO is managed for investors in a
feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2010.

o LIFEPATH 2020 MASTER PORTFOLIO is managed for investors in a
feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2020.

o LIFEPATH 2030 MASTER PORTFOLIO is managed for investors in a
feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2030.

o LIFEPATH 2040 MASTER PORTFOLIO is managed for investors in a
feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2040.

Each LifePath Master Portfolio's investment objective cannot be
changed without approval by the holders of a majority (as defined in the 1940
Act) of such Master Portfolio's outstanding voting securities. The differences
in objectives and policies among the Master Portfolios determine the types of
portfolio securities in which each Master Portfolio invests and can be expected
to affect the degree of risk to which each Master Portfolio is subject and the
yield or return of each Master Portfolio. As with all mutual funds, there can
be no assurance that the investment objective of each Master Portfolio will be
achieved.

INTRODUCTION. The LifePath 2000 Master Portfolio , LifePath 2010 Master
Portfolio , LifePath 2020 Master Portfolio , LifePath 2030 Master Portfolio and
LifePath 2040 Master Portfolio follow an asset allocation strategy among three
broad investment classes: equity and debt securities of issuers located
throughout the world and cash in the form of money market instruments. Each
LifePath Master Portfolio differs in the weighting assigned to each such
investment class, with the later-dated LifePath Master Portfolio generally
bearing more risk than the earlier-dated LifePath Master Portfolio, with the
expectation of greater total return. Thus, the investment class weightings of
the LifePath 2040 Master Portfolio initially might be 100%, 0%

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and 0% among equity securities, debt securities and cash, respectively, while
the weightings of the LifePath 2000 Master Portfolio initially might be 25%,
50% and 25%, respectively. Over years, each LifePath Master Portfolio is
managed more conservatively, on the premise that individuals investing for
retirement desire to reduce investment risk in their retirement accounts as
they age. The difference in such investment class weightings is based on the
statistically determined risk that such investors, on average, may be willing
to accept given their investment time horizons in an effort to maximize assets
in anticipation of retirement or for other purposes.

To manage the LifePath Master Portfolios, BGFA employs a
proprietary investment model (the "Model"), developed and previously used by
WFNIA, that analyzes extensive financial and economic data, including risk,
correlation and expected return statistics, to recommend the portfolio
allocation among the investment classes described below. At its simplest, for
each point in time, the Model recommends a portfolio allocation designed to
maximize total return for each LifePath Master Portfolio based on each such
LifePath Master Portfolio's evolving risk profile. As a result, while each
LifePath Master Portfolio invests in substantially the same securities within
an investment class, the amount of each LifePath Master Portfolio's aggregate
assets invested in a particular investment class, and thus in particular
securities, differs, but the relative percentage that a particular security
comprises within an investment class ordinarily remains substantially the same.
As of June 1, 1996, the asset allocations in the LifePath Master Portfolios
were approximately as follows:

<TABLE>
<CAPTION>
LifePath 2000 LifePath 2010 LifePath 2020 LifePath 2030 LifePath 2040
Master Portfolio Master Portfolio Master Portfolio Master Portfolio Master Portfolio
---------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C>
Equity
Securities:

Domestic 17% 39% 53% 63% 75%
Internatl. 5% 11% 15% 19% 20%

Debt 71% 49% 31% 17% 4%
Securities

Cash 1% 1% 1% 1% 1%
</TABLE>

BGFA may in the future refine the Model or the financial and
economic data analyzed by the Model in ways that could result in changes to
recommended allocations.

The relative weightings for each LifePath Master Portfolio of the
various investment classes are expected to change over time, with the LifePath
2040 Master Portfolio adopting in the 2030s characteristics similar to the
LifePath 2000 Master Portfolio today.

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<PAGE> 7
MANAGEMENT POLICIES.

The LifePath Model contains both "strategic" and "tactical"
components, with the strategic component weighted more heavily than the
tactical component. The strategic component of the Model evaluates the risk
that investors, on average, may be willing to accept given their investment
time horizons. The strategic component thus determines the changing investment
risk level of each LifePath Fund as time passes. The tactical component of the
Model, on the other hand, addresses short-term market conditions. The tactical
component thus adjusts the amount of investment risk taken by each LifePath
Fund without regard to time horizon, but rather in consideration of the
relative risk-adjusted short-term attractiveness of various asset classes.

Through the strategic and tactical components the asset allocation
strategy contemplates shifts, that may be frequent, among a wide range of U.S.
and foreign investments and market sectors. Each LifePath Master Portfolio may
invest up to approximately 20% of the value of its total assets in foreign
securities that are not publicly traded in the United States. Rather than
choosing specific securities, BGFA selects indices representing segments of the
global equity and debt markets and invests to create market exposure to these
market segments by purchasing representative samples of securities comprising
the indices in an attempt to replicate their performance. From time to time,
other indices may be selected in addition to, or as a substitute for, any of
the indices listed herein and market exposure may be broadened. Investors will
be notified of any such change.

BGFA has broad latitude in selecting the class of investments and
the particular securities within a class in which each LifePath Master
Portfolio invests. No LifePath Master Portfolio is managed as a balanced
portfolio nor is it required to maintain a portion of its investments in each
of its permitted investment categories at all times. Until a LifePath Master
Portfolio attains an asset level of approximately $100 to $150 million, BGFA
allocates assets across fewer investment categories than it otherwise would.
BGFA compares each LifePath Master Portfolio's investments from time to time to
the Model's recommended allocation. Recommended reallocations are implemented
subject to BGFA's assessment of current economic conditions and investment
opportunities. BGFA may change from time to time the criteria and methods it
uses to implement the recommendations of the Model. Any recommended
reallocation is implemented in accordance with trading policies designed to
take advantage of market opportunities and reduce transaction costs. The asset
allocation mix selected is a primary determinant in the respective LifePath
Master Portfolio's investment performance.

BGFA manages other portfolios that also invest in accordance with
the Model. The performance of each of those other portfolios is likely to vary
among themselves and from the performance of each LifePath Master Portfolio.
Such variation in performance is primarily due to different equilibrium asset
mix assumptions used for the various portfolios, timing differences in the
implementation of the Model's recommendations and differences in expenses and
liquidity requirements.

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<PAGE> 8
The LifePath Master Portfolios may invest in up to 17 asset
classes, including 10 stock classes, 6 bond classes and a money market class.
Each LifePath Master Portfolio invests in the classes of investments described
below in the following manner:

EQUITY SECURITIES -- The LifePath Master Portfolios seek U.S. equity market
exposure through the following indices of common stock:

o The S&P/BARRA Value Stock Index (consisting of primarily
large-capitalization U.S. stocks with lower-than- average price/book
ratios).

o The S&P/BARRA Growth Stock Index (consisting of primarily
large-capitalization U.S. stocks with higher-than- average price/book
ratios).

o The Intermediate Capitalization Value Stock Index (consisting of
primarily medium-capitalization U.S. stocks with lower-than-average
price/book ratios).

o The Intermediate Capitalization Growth Stock Index (consisting of
primarily medium-capitalization U.S. stocks with higher-than-average
price/book ratios).

o The Intermediate Capitalization Utility Stock Index (consisting of
primarily medium-capitalization U.S. utility stocks).

o The Micro Capitalization Market Index (consisting of primarily
small-capitalization U.S. stocks).

o The Small Capitalization Value Stock Index (consisting of primarily
small-capitalization U.S. stocks with lower-than-average price/book
ratios).

o The Small Capitalization Growth Stock Index (consisting of primarily
small-capitalization U.S. stocks with higher-than-average price/book
ratios).

The LifePath Master Portfolios seek foreign equity market exposure
through the following indices of foreign equity securities:

o The Morgan Stanley Capital International (MSCI) Japan Index
(consisting of primarily large-capitalization Japanese stocks).

o The Morgan Stanley Capital International Europe, Australia, Far East
Index (MSCI EAFE) Ex-Japan Index (consisting of primarily
large-capitalization foreign stocks, excluding Japanese stocks).

In addition, each LifePath Master Portfolio may invest in other
common stocks, preferred stocks and convertible securities, including those in
the form of American, European and Continental Depositary Receipts, as well as
warrants to purchase such securities, and investment company securities. See
"Appendix -- Portfolio Securities."

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<PAGE> 9
DEBT SECURITIES -- The LifePath Master Portfolios seek U.S. debt market
exposure through the following indices of U.S. debt securities:

o The Lehman Brothers Long-Term Government Bond Index (consisting of all
U.S. Government bonds with maturities of at least ten years).

o The Lehman Brothers Intermediate-Term Government Bond Index
(consisting of all U.S. Government bonds with maturities of less than
ten years and greater than one year).

o The Lehman Brothers Long-Term Corporate Bond Index (consisting of all
U.S. investment grade corporate bonds with maturities of at least ten
years).

o The Lehman Brothers Intermediate-Term Corporate Bond Index (consisting
of all U.S. investment-grade corporate bonds with maturities of less
than ten years and greater than one year).

o The Lehman Brothers Mortgage-Backed Securities Index (consisting of
all fixed-coupon mortgage pass-throughs (issued by the Federal
National Mortgage Association, Government National Mortgage
Association and Federal Home Loan Mortgage Corporation with maturities
greater than one year).

The LifePath Master Portfolios seek foreign debt market exposure
through the following index of foreign debt securities:

o The Salomon Brothers Non-U.S. World Government Bond Index (consisting
of foreign government bonds with maturities of greater than one year).

Each U.S. and foreign debt security is expected to be part of an
issuance with a minimum outstanding amount at the time of purchase of
approximately $50 million and $100 million, respectively. Each security in
which a LifePath Master Portfolio invests must be rated at least Baa by Moody's
Investors Service, Inc. ("Moody's"), or BBB by Standard & Poor's Corporation
("S&P"), Fitch Investors Service, Inc. ("Fitch") or Duff & Phelps, Inc.
("Duff") or, if unrated, deemed to be of comparable quality by BGFA. See "Risk
Factors--Fixed-Income Securities" below, and "Appendix" in Part B.

MONEY MARKET INSTRUMENTS -- The money market instrument portion of each
LifePath Master Portfolio's investment portfolio generally is invested in
high-quality money market instruments, including U.S. Government obligations,
obligations of domestic and foreign banks, short-term corporate debt
instruments and repurchase agreements. See "Appendix" below for a more
complete description of the money market instruments in which each Master
Portfolio may invest.

INVESTMENT TECHNIQUES -- Each LifePath Master Portfolio also may lend its
portfolio securities and enter into transactions in certain derivatives, each
of which involves risk. Derivatives are financial instruments whose values are
derived, at least in part, from the prices of other securities

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<PAGE> 10
or specified assets, indices or rates. The futures contracts and options on
futures contracts that a LifePath Master Portfolio may purchase are considered
derivatives. Each LifePath Master Portfolio may use some derivatives as part
of its short-term liquidity holdings and/or as substitutes for comparable
market positions in the underlying securities. Also, asset-backed securities
issued or guaranteed by U.S. Government agencies or instrumentalities and
certain floating- and variable-rate instruments can be considered derivatives.
Some derivatives may be more sensitive than direct securities to changes in
interest rates or sudden market moves. Some derivatives also may be
susceptible to fluctuations in yield or value due to their structure or
contract terms.

BGFA (as investment adviser to the LifePath Master Portfolios)
uses a variety of internal risk management procedures to ensure that
derivatives use is consistent with each LifePath Master Portfolio's investment
objective, does not expose the LifePath Master Portfolio to undue risks and is
closely monitored, including providing periodic reports to the Board of
Trustees concerning the use of derivatives. Wells Fargo Bank and WFNIA, the
previous investment adviser and sub-adviser, respectively, employed
substantially similar internal risk management procedures. Derivatives use
also is subject to broadly applicable investment policies. For example, in no
case may a LifePath Master Portfolio invest more than 15% of the current value
of its assets in "illiquid securities," including derivatives without active
secondary markets. Nor may a LifePath Master Portfolio use derivatives to
create leverage without establishing adequate "cover" in compliance with
Securities and Exchange Commission leverage rules. For more information, see
"Risk Factors" below, and "Appendix -- Investment Techniques."

CERTAIN FUNDAMENTAL POLICIES. Each Master Portfolio may (i) borrow money to
the extent permitted under the 1940 Act; (ii) invest up to 5% of its total
assets in the obligations of any single issuer, except that up to 25% of the
value of the total assets of such Master Portfolio may be invested and
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities may be purchased, without regard to any such limitation; and
(iii) invest up to 25% of the value of its total assets in the securities of
issuers in a particular industry or group of closely related industries,
provided there is no limitation on the purchase of obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities. This
paragraph describes fundamental policies that cannot be changed as to a Master
Portfolio without approval by the holders of a majority (as defined in the 1940
Act) of such Master Portfolio's outstanding voting securities. See Item 13,
"Investment Objectives and Policies -- Investment Restrictions," in Part B.

CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICIES. Each Master Portfolio may (i)
purchase securities of companies having less than three years' continuous
operation (including operations of any predecessors) if such purchase does not
cause the value of its investments in all such companies to exceed 5% of the
value of its total assets; (ii) pledge, hypothecate, mortgage or otherwise
encumber its assets, but only to secure permitted borrowings; and (iii) invest
up to 15% of the value of its net assets in repurchase agreements providing for
settlement in more than seven days after notice and in other illiquid
securities. Although each feeder fund and LifePath Master Portfolio reserves
the right to invest up to 15% of the value of its net assets in illiquid
securities, including repurchase agreements providing for settlement in more
than seven days after notice, as long as such feeder fund's shares are
registered for sale in a state that imposes a lower limit on the

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<PAGE> 11
percentage of a fund's assets that may be so invested, such feeder fund and
LifePath Master Portfolio will comply with the lower limit. Each feeder fund
currently is limited to investing up to 10% of the value of its net assets in
such securities due to limits applicable in several states. See Item 13,
"Investment Objectives and Policies -- Investment Restrictions," in Part B.

RISK FACTORS.

GENERAL -- The net asset value per share of each LifePath Master Portfolio is
not fixed and should be expected to fluctuate.

INVESTMENT TECHNIQUES -- Each LifePath Master Portfolio may engage in various
investment techniques the use of which involves greater risk than that incurred
by other funds with similar investment objectives. See "Appendix -- Investment
Techniques." Using these techniques may affect the degree to which a LifePath
Master Portfolio's net asset value fluctuates.

EQUITY SECURITIES -- Investors should be aware that equity securities fluctuate
in value, often based on factors unrelated to the value of the issuer of the
securities, and that fluctuations can be pronounced. Changes in the value of a
LifePath Master Portfolio's portfolio securities result in changes in the value
of such LifePath Master Portfolio's shares and thus the LifePath Master
Portfolio's total returns to investors.

The securities of the smaller companies in which each LifePath
Master Portfolio may invest may be subject to more abrupt or erratic market
movements than larger, more-established companies, both because the securities
typically are traded in lower volume and because the issuers typically are
subject to a greater degree to changes in earnings and prospects.

FIXED-INCOME SECURITIES -- Investors should be aware that even though
interest-bearing securities are investments which promise a stable stream of
income, the prices of such securities are inversely affected by changes in
interest rates and, therefore, are subject to the risk of market price
fluctuations. Thus, if interest rates have increased from the time a security
was purchased, such security, if sold, might be sold at a price less than cost.
Similarly, if interest rates have declined from the time a security was
purchased, such security, if sold, might be sold at a price greater than its
cost. Longer-term securities are affected to a greater extent by interest
rates than shorter-term securities. The values of fixed-income securities also
may be affected by changes in the credit rating or financial condition of the
issuing entities. Certain securities that may be purchased by the LifePath
Master Portfolios, such as those rated Baa by Moody's and BBB by S&P, Fitch and
Duff, may be subject to such risk with respect to the issuing entity and to
greater market fluctuations than certain lower yielding, higher rated
fixed-income securities. Securities which are rated Baa by Moody's are
considered medium-grade obligations; they are neither highly protected nor
poorly secured, and are considered by Moody's to have speculative
characteristics. Securities rated BBB by S&P are regarded as having adequate
capacity to pay interest and repay principal, and while such debt securities
ordinarily exhibit 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 securities in this category than in higher
rated categories. Securities rated BBB by Fitch are considered investment
grade and of satisfactory

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credit quality; however, adverse changes in economic conditions and
circumstances are more likely to have an adverse impact on these securities
and, therefore, impair timely payment. Securities rated BBB by Duff have below
average protection factors but nonetheless are considered sufficient for
prudent investment. If a security held by a LifePath Master Portfolio is
downgraded to a rating below investment grade, such Master Portfolio may
continue to hold the security until such time as BGFA determines it
advantageous for the LifePath Master Portfolio to sell the security. If such a
policy would cause a LifePath Master Portfolio to have 5% or more of its net
assets invested in securities that have been downgraded below investment grade,
the Master Portfolio promptly would seek to dispose of such securities in an
orderly manner. See "Appendix -- Portfolio Securities -- Ratings" and
"Appendix" in Part B.

FOREIGN SECURITIES -- Foreign securities markets generally are not as developed
or efficient as those in the United States. Securities of some foreign issuers
are less liquid and more volatile than securities of comparable U.S. issuers.
Similarly, volume and liquidity in most foreign securities markets are less
than in the United States and, at times, volatility of price can be greater
than in the United States. In addition, there may be less publicly available
information about a non-U.S. issuer, and non-U.S. issuers generally are not
subject to uniform accounting and financial reporting standards, practices and
requirements comparable to those applicable to U.S. issuers.

Because evidences of ownership of such securities usually are held
outside the United States, each Master Portfolio is subject to additional risks
which include possible adverse political and economic developments, possible
seizure or nationalization of foreign deposits and possible adoption of
governmental restrictions which might adversely affect the payment of principal
and interest on the foreign securities or might restrict the payment of
principal and interest to investors located outside the country of the issuers,
whether from currency blockage or otherwise. Custodial expenses for a
portfolio of non-U.S. securities generally are higher than for a portfolio of
U.S. securities.

Since the LifePath Master Portfolios may purchase foreign
securities in currencies of foreign countries, the value of these assets as
measured in U.S. dollars may be affected favorably or unfavorably by changes in
currency rates and exchange control regulations. Some currency exchange costs
generally are incurred when a LifePath Master Portfolio changes investments
from one country to another.

Furthermore, some of these securities may be subject to brokerage
or stamp taxes levied by foreign governments, which have the effect of
increasing the cost of such investment and reducing the realized gain or
increasing the realized loss on such securities at the time of sale. Income
received by a LifePath Master Portfolio from sources within foreign countries
may be reduced by withholding and other taxes imposed by such countries. Tax
conventions between certain countries and the United States, however, may
reduce or eliminate such taxes. All such taxes paid by a Master Portfolio
reduce its net income available for distribution to its interestholders.

FOREIGN CURRENCY EXCHANGE -- Currency exchange rates may fluctuate
significantly over short periods of time. They generally are determined by the
forces of supply and demand in the foreign

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exchange markets and the relative merits of investments in different countries,
actual or perceived changes in interest rates and other complex factors, as
seen from an international perspective. Currency exchange rates also can be
affected unpredictably by the intervention of U.S. or foreign governments or
central banks, or by the failure to intervene, or by currency controls or
political developments in the United States or abroad. The LifePath Master
Portfolios intend to engage in foreign currency transactions to maintain the
same foreign currency exposure as the relevant foreign securities index through
which the LifePath Master Portfolios seek foreign equity market exposure, but
not as part of a defensive strategy to protect against fluctuations in exchange
rates.

Foreign currency transactions may occur on a spot (i.e., cash)
basis at the rate prevailing in the currency exchange market or on a forward
basis. A forward currency exchange contract involves an obligation to purchase
or sell a specific currency at a set price on a future date which must be more
than two days from the date of the contract. The forward foreign currency
market offers less protection against default than is available when trading
currencies on an exchange, since a forward currency contract is not guaranteed
by an exchange or clearinghouse. Therefore, a default on a forward currency
contract would deprive a LifePath Master Portfolio of unrealized profits or
force such Master Portfolio to cover its commitments for purchase or resale, if
any, at the current market price.

FOREIGN FUTURES TRANSACTIONS -- Unlike trading on domestic futures exchanges,
trading on foreign futures exchanges is not regulated by the Commodity Futures
Trading Commission (the "CFTC") and generally is subject to greater risks than
trading on domestic exchanges. For example, some foreign exchanges are
principal markets so that no common clearing facility exists and an investor
may look only to the broker for performance of the contract. BGFA, however,
considers on an ongoing basis the creditworthiness of such counterparties. In
addition, any profits that a LifePath Master Portfolio might realize in trading
could be eliminated by adverse changes in the exchange rate; adverse exchange
rate changes also could cause a LifePath Master Portfolio to incur losses.
Transactions on foreign exchanges may include both futures contracts which are
traded on domestic exchanges and those which are not.

OTHER INVESTMENT CONSIDERATIONS -- Asset allocation and modeling strategies are
employed by BGFA for other investment companies and accounts advised or
sub-advised by BGFA. If these strategies indicate particular securities should
be purchased or sold, at the same time, by a LifePath Master Portfolio and one
or more of these investment companies or accounts, available investments or
opportunities for sales are allocated equitably to each by BGFA. In some
cases, this procedure may adversely affect the size of the position obtained
for or disposed of by a LifePath Master Portfolio or the price paid or received
by such LifePath Master Portfolio.

Under normal market conditions, the portfolio turnover rate for
each LifePath Master Portfolio is not expected to exceed 100%. A portfolio
turnover rate of 100% would occur, for example, if all of a LifePath Master
Portfolio's securities were replaced within one year. Higher portfolio
turnover rates are likely to result in comparatively greater brokerage
commissions. In addition, short-term gains realized from portfolio
transactions are taxable to interestholders as ordinary income. Portfolio
turnover is not a limiting factor in making investment decisions.

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<PAGE> 14
Item 5. Management of the Master Portfolios.

INVESTMENT ADVISER AND SUB-INVESTMENT ADVISER --Pursuant to separate investment
advisory contracts dated January 1, 1996 (the "BGFA Advisory Contracts"), BGFA
serves as investment adviser to each LifePath Master Portfolio. BGFA is an
indirect subsidiary of Barclays Bank PLC ("Barclays") and is located at 45
Fremont Street, San Francisco, CA 94105. As of March 31, 1996, BGFA and its
affiliates provided investment advisory services for over $284 billion of
assets under management.

The BGFA Advisory Contracts provide that BGFA shall furnish to
each LifePath Master Portfolio investment guidance and policy direction in
connection with the daily portfolio management of such Master Portfolio,
subject to the supervision of MIP's Board of Trustees and in conformity with
Delaware law and the stated policies of each Master Portfolio. Pursuant to the
BGFA Advisory Contracts, BGFA furnishes to MIP's Board of Trustees, periodic
reports on the investment strategy and performance of each LifePath Master
Portfolio. BGFA continues to employ substantially the same WFNIA investment
professionals that previously managed the investment portfolio of each Master
Portfolio.

BGFA is entitled to receive monthly fees at the annual rate of
0.55% of the average daily net assets of each LifePath Master Portfolio as
compensation for its advisory services. From time to time, BGFA may waive such
fees in whole or in part. Any such waiver will reduce the expenses of a Master
Portfolio and, accordingly, have a favorably impact on the performance of such
Master Portfolio. For the period beginning January 1, 1996 and ended February
29, 1996, BGFA received amounts equal to 0.55% of the average daily net assets
of each of the LifePath Master Portfolios as compensation for its advisory
services.

BGFA may deal, trade and invest for its own account in the types
of securities in which the Master Portfolios may invest. BGFA has informed MIP
that in making its investment decisions it does not obtain or use material
inside information in its possession.

Prior to January 1, 1996, Wells Fargo Bank, a wholly owned
subsidiary of Wells Fargo & Company located at 420 Montgomery Street, San
Francisco, California 94105, was each Master Portfolio's investment adviser.
Pursuant to an Investment Advisory Agreement with MIP, Wells Fargo Bank
provided investment guidance and policy direction in connection with the
management of each Master Portfolio's assets, subject to the supervision of
MIP's Board of Trustees and in conformity with Delaware law and the stated
policies of such Master Portfolio. The BGFA Advisory Contracts are identical
in all material respects, other than the identity of the parties, to the
Investment Advisory Agreement with Wells Fargo Bank, the prior investment
adviser to each Master Portfolio. The Investment Advisory Agreement with Wells
Fargo Bank terminated as of January 1, 1996. For the period beginning March 1,
1995 and ended December 31, 1995, MIP paid to Wells Fargo Bank fees equal to
0.55% of the average daily net assets of each LifePath Master Portfolio as
compensation for advisory services to such Master Portfolio.

Prior to January 1, 1996, Wells Fargo Bank engaged WFNIA, located
at 45 Fremont Street, San Francisco, California 94105, to provide
sub-investment advisory services to each

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<PAGE> 15
Master Portfolio. WFNIA was a general partnership, which was dissolved on
December 31, 1995, was owned 50% by a wholly owned subsidiary of Wells Fargo
Bank and 50% by a subsidiary of The Nikko Securities Co., Ltd. Prior to
January 1, 1996, and pursuant to a Sub-Investment Advisory Agreement, WFNIA,
provided investment advisory assistance and the day- to-day management of each
Master Portfolio's assets, subject to the supervision and approval of Wells
Fargo Bank and the overall authority of MIP's Board of Trustees and in
conformity with Delaware law and the stated policies of such Master Portfolio.
Wells Fargo Bank was contractually obligated to pay WFNIA an amount equal to
0.40% of each LifePath Master Portfolio's average daily net assets as
compensation for its sub-advisory services. For the period beginning March 1,
1995 and ended December 31, 1995, Wells Fargo Bank paid fees equal to 0.40% of
the average daily net assets of each Master Portfolio to WFNIA for its
sub-advisory services to such Master Portfolio.

Morrison & Foerster LLP, counsel to MIP and special counsel to
BGFA, has advised MIP and BGFA that BGFA and its affiliates may perform the
services contemplated by the BGFA Advisory Contracts and this Part A without
violation of the Glass-Steagall Act. Such counsel has pointed out, however,
that there are no controlling judicial or administrative interpretations or
decisions and that future judicial or administrative interpretations of, or
decisions relating to, present federal or state statutes, including the
Glass-Steagall Act, and relating to the permissible activities of banks and
their subsidiaries or affiliates, as well as future changes in such statutes,
regulations and judicial or administrative decisions or interpretations, could
prevent such entities from continuing to perform, in whole or in part, such
services. If any such entity were prohibited from performing any such
services, it is expected that new agreements would be proposed or entered into
with another entity or entities qualified to perform such services.

ADMINISTRATOR AND PLACEMENT AGENT -- Stephens Inc. ("Stephens"), located at 111
Center Street, Little Rock, Arkansas 72201, serves as MIP's administrator
pursuant to an Administration Agreement with MIP. Under the Administration
Agreement, Stephens provides general supervision of the operation of MIP and
the Master Portfolios, other than the provision of investment advice, subject
to the overall authority of MIP's Board of Trustees and in accordance with
Delaware law. The administrative services provided to the Master Portfolios
also include coordination of the other services provided to the Master
Portfolios, compilation of information for reports to the Securities and
Exchange Commission and state securities commissions, preparation of proxy
statements and interestholder reports, and general supervision of data
compilation in connection with preparing periodic reports to MIP's Board of
Trustees and officers. Stephens also furnishes office space and certain
facilities to conduct MIP's business, and compensates MIP's Trustees, officers
and employees who are affiliated with Stephens. Stephens is not entitled to
compensation for providing administrative services to a Master Portfolio so
long as Stephens receives fees for providing similar services to a fund of
another registered investment company that invests all of its assets in the
Master Portfolio. Stephens also serves as placement agent for each Master
Portfolio's interests.

Stephens is a full service broker/dealer and investment advisory
firm. Stephens and its predecessor have been providing securities and
investment services for more than 60 years, including discretionary portfolio
management services since 1983. Stephens currently manages

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<PAGE> 16
investment portfolios for pension and profit sharing plans, individual
investors, foundations, insurance companies and university endowments.

CUSTODIAN AND TRANSFER AGENT. BGI serves as custodian to each Master Portfolio
and is located at 45 Fremont Street, San Francisco, California 94105. BGI is a
wholly-owned subsidiary of BZW Barclays Global Investors Holdings Inc.
(formerly, The Nikko Building U.S.A., Inc.) and is also an indirect subsidiary
of Barclays. Prior to January 1, 1996, BGI was known as Wells Fargo
Institutional Trust Company, N.A., ("WFITC") and WFNIA and Wells Fargo &
Company together held 100% of WFITC's outstanding voting securities. Wells
Fargo Bank is each Master Portfolio's Transfer and Dividend Disbursing Agent
(the "Transfer Agent"). The principle business address of Wells Fargo Bank is
525 Market Street, San Francisco, California 94105-1308.

EXPENSES. All expenses incurred in the operation of MIP are borne by MIP,
except to the extent specifically assumed by BGFA (or, prior to January 1,
1996, by Wells Fargo Bank) and Stephens. Expenses attributable to a particular
Master Portfolio are charged against the assets of that Master Portfolio; other
expenses of MIP are allocated among the Master Portfolios on the basis
determined by the Board of Trustees, including, but not limited to,
proportionately in relation to the net assets of each Master Portfolio.

An investor in a Master Portfolio will bear such Master
Portfolio's transaction costs incurred in buying and selling securities and
engaging in certain investment techniques to effect a purchase or redemption
(including through an exchange from another Master Portfolio) of such Master
Portfolio's shares by the investor. These transaction costs may include: (1)
brokerage commissions; (2) market impact costs (i.e., the increase in market
prices which may result if a Master Portfolio purchases thinly traded stocks);
and (3) the effect of any "bid-ask" spread in the relevant securities market.

Item 6. Capital Stock and Other Securities.

MIP is organized as a trust under the laws of the State of
Delaware. Investors in MIP are each liable for all obligations of MIP.
However, the risk of an investor incurring financial loss on account of such
liability is limited to circumstances in which both inadequate insurance exists
and MIP itself is unable to meet its obligations.

To date, the Board of Trustees has authorized the creation of
fourteen separate series. All consideration received by MIP for shares of one
of the series and all assets in which such consideration is invested belong to
that series (subject only to the rights of creditors of MIP) and is subject to
the liabilities related thereto. The income attributable to, and the expenses
of, one series are treated separately from those of the other series. MIP has
the ability to create, from time to time, new series without interestholder
approval.

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<PAGE> 17
PORTFOLIO INVOLVES CERTAIN INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL. THE SHARE PRICE AND INVESTMENT RETURN OF EACH MASTER PORTFOLIO IS
EXPECTED TO FLUCTUATE AND INVESTMENTS IN THE MASTER PORTFOLIOS ARE NOT
GUARANTEED.

Unless otherwise required by the 1940 Act, ordinarily it is not
necessary for MIP to hold annual meetings of interestholders. As a result,
interestholders may not consider each year the election of Trustees or the
appointment of auditors. However, the holders of at least 10% of the shares
outstanding and entitled to vote may require MIP to hold a special meeting of
interestholders for purposes of removing a Trustee from office. MIP
interestholders may remove a Trustee by the affirmative vote of a majority of
MIP's outstanding voting securities. In addition, the Board of Trustees will
call a meeting of interestholders for the purpose of electing Trustees if, at
any time, less than a majority of the Trustees then holding office have been
elected by interestholders. Investments in a Master Portfolio may not be
transferred, but an investor may withdraw all or any portion of its investment
at any time at net asset value.

Each Master Portfolio of MIP will be considered a non-publicly
traded partnership for federal income tax purposes, and as such, it will not be
subject to federal income tax. However, each investor in a Master Portfolio is
taxable on its share (as determined in accordance with the governing
instruments of MIP) of such Master Portfolio's taxable income in determining
its income tax liability. The determination of such share is made in
accordance with the Internal Revenue Code of 1986, as amended (the "Code"), and
regulations promulgated thereunder.

It is expected that each Master Portfolio is managed so that each
investment company that invests all of its assets in a Master Portfolio
qualifies as a "regulated investment company" under the Code.

As of June 25, 1996, the following funds of MasterWorks Funds Inc.
("MasterWorks") and Stagecoach Trust ("Stagecoach") held the following
percentages of the outstanding voting securities of the indicated LifePath
Master Portfolio and, as such, could be considered controlling persons for
purposes of the 1940 Act of the corresponding Master Portfolio.

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<PAGE> 18
<TABLE>
<CAPTION>
% Outstanding
LifePath Master Portfolio Fund Securities Held
- ------------------------- ---- ---------------
<S> <C> <C>
LifePath 2000 Master Portfolio MasterWorks LifePath 2000 28%
Stagecoach LifePath 2000 72%

LifePath 2010 Master Portfolio MasterWorks LifePath 2010 45%
Stagecoach LifePath 2010 55%

LifePath 2020 Master Portfolio MasterWorks LifePath 2020 37%
Stagecoach LifePath 2020 63%

LifePath 2030 Master Portfolio MasterWorks LifePath 2030 30%
Stagecoach LifePath 2030 70%

LifePath 2040 Master Portfolio MasterWorks LifePath 2040 22%
Stagecoach LifePath 2040 78%
</TABLE>

Item 7. Purchase of Securities.

Beneficial interests in the Master Portfolios are issued solely in
private placement transactions which do not involve any "public offering"
within the meaning of Section 4(2) of the 1933 Act. Investments in the Master
Portfolios may be made only by investment companies or certain other entities
which are "accredited investors" within the meaning of Regulation D under the
1933 Act. This registration statement does not constitute an offer to sell, or
the solicitation of an offer to buy, any "security" within the meaning of the
1933 Act.

Shares of each Master Portfolio are sold on a continuous basis at
the net asset value per share next determined after an order in proper form is
received by the Transfer Agent. Net asset value per share for each LifePath
Master Portfolio is determined as of the close of trading on the New York Stock
Exchange ("NYSE") (currently 4:00 p.m., Eastern Standard Time) on each day the
NYSE is open for business (a "Business Day"). Net asset value per share is
computed by dividing the value of a Master Portfolio's net assets (i.e., the
value of its assets less liabilities) by the total number of shares of such
Master Portfolio outstanding. A Master Portfolio's investments are valued each
Business Day generally by using available market quotations or at fair value
determined in good faith by the investment adviser or sub-adviser pursuant to
guidelines approved by MIP's Board of Trustees. For further information
regarding the methods employed in valuing each Master Portfolio's investments,
see Item 19, "Purchase, Redemption and Pricing of Securities" in Part B.

Item 8. Redemption or Repurchase.

An investor in MIP may withdraw all or any portion of its
investment on any Business Day at the net asset value next determined after a
withdrawal request in proper form is furnished by the investor to the Transfer
Agent. When a request is received in proper form, MIP redeems the shares at
the next determined net asset value.

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<PAGE> 19
Each Master Portfolio makes payment for all shares redeemed within
five days after receipt by the Transfer Agent of a redemption request in proper
form, except as provided by the rules of the Securities and Exchange
Commission. Investments in a Master Portfolio may not be transferred.

The right of any investor to receive payment with respect to any
withdrawal may be suspended or the payment of the withdrawal proceeds postponed
during any period in which the New York Stock Exchange is closed (other than
weekends or holidays) or trading on such Exchange is restricted, or, to the
extent otherwise permitted by the 1940 Act, if an emergency exists.

Item 9. Pending Legal Proceedings.

Not applicable.

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<PAGE> 20
APPENDIX

PORTFOLIO SECURITIES.

To the extent set forth in this offering document, each Master
Portfolio may invest in the securities described below.

U.S. GOVERNMENT OBLIGATIONS -- U.S. Government obligations include securities
issued or guaranteed as to principal and interest by the U.S. Government and
supported by the full faith and credit of the U.S. Treasury. U.S. Treasury
obligations differ mainly in the length of their maturity. Treasury bills, the
most frequently issued marketable government securities, have a maturity of up
to one year and are issued on a discount basis. U.S. Government obligations
also include securities issued or guaranteed by federal agencies or
instrumentalities, including government- sponsored enterprises. Some
obligations of agencies or instrumentalities of the U.S. Government are
supported by the full faith and credit of the United States or U.S. Treasury
guarantees; others, by the right of the issuer or guarantor to borrow from the
U.S. Treasury; still others by the discretionary authority of the U.S.
Government to purchase certain obligations of the agency or instrumentality;
and others, only by the credit of the agency or instrumentality issuing the
obligation. In the case of obligations not backed by the full faith and credit
of the United States, the investor must look principally to the agency or
instrumentality issuing or guaranteeing the obligation for ultimate repayment,
which agency or instrumentality may be privately owned. There can be no
assurance that the U.S. Government would provide financial support to its
agencies or instrumentalities (including government-sponsored enterprises)
where it is not obligated to do so. In addition, U.S. Government obligations
are subject to fluctuations in market value due to fluctuations in market
interest rates. As a general matter, the value of debt instruments, including
U.S. Government obligations, declines when market interest rates increase and
rises when market interest rates decrease. Certain types of U.S. Government
obligations are subject to fluctuations in yield or value due to their
structure or contract terms.

FOREIGN GOVERNMENT OBLIGATIONS; SECURITIES OF SUPRANATIONAL ENTITIES -- Each
Master Portfolio, through its investment in money market instruments, may
invest in obligations issued or guaranteed by one or more foreign governments
or any of their political subdivisions, agencies or instrumentalities that are
determined by BGFA to be of comparable quality to the other obligations in
which such Master Portfolio may invest. Such securities also include debt
obligations of supranational entities. Supranational entities include
international organizations designated or supported by governmental entities to
promote economic reconstruction or development and international banking
institutions and related government agencies. Examples include the
International Bank for Reconstruction and Development (the World Bank), the
European Coal and Steel Community, the Asian Development Bank and the
InterAmerican Development Bank. The percentage of a Master Portfolio's assets
invested in securities issued by foreign governments varies depending on the
relative yields of such securities, the economic and financial markets of the
countries in which the investments are made and the interest rate climate of
such countries.

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<PAGE> 21
BANK OBLIGATIONS -- Each Master Portfolio may invest in bank obligations,
including certificates of deposit, time deposits, bankers' acceptances and
other short-term obligations of domestic banks, foreign subsidiaries of
domestic banks, foreign branches of domestic banks, and domestic and foreign
branches of foreign banks, domestic savings and loan associations and other
banking institutions. With respect to such securities issued by foreign
branches of domestic banks, foreign subsidiaries of domestic banks, and
domestic and foreign branches of foreign banks, a Master Portfolio may be
subject to additional investment risks that are different in some respects from
those incurred by a fund which invests only in debt obligations of U.S.
domestic issuers. Such risks include possible future political and economic
developments, the possible imposition of foreign withholding taxes on interest
income payable on the securities, the possible establishment of exchange
controls or the adoption of other foreign governmental restrictions which might
adversely affect the payment of principal and interest on these securities and
the possible seizure or nationalization of foreign deposits.

Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period of
time.

Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate. Time
deposits which may be held by a Master Portfolio will not benefit from
insurance from the Bank Insurance Fund or the Savings Association Insurance
Fund administered by the FDIC.

Bankers' acceptances are credit instruments evidencing the
obligation of a bank to pay a draft drawn on it by a customer. These
instruments reflect the obligation both of the bank and of the drawer to pay
the face amount of the instrument upon maturity. The other short-term
obligations may include uninsured, direct obligations, bearing fixed, floating
or variable interest rates.

COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS -- Each Master
Portfolio may invest in commercial paper, which consists of short-term,
unsecured promissory notes issued to finance short-term credit needs. The
commercial paper purchased by the LifePath Master Portfolio consists only of
direct obligations which, at the time of their purchase, are (a) rated not
lower than Prime-1 by Moody's, A-1 by S&P, F-1 by Fitch or Duff-1 by Duff, (b)
issued by companies having an outstanding unsecured debt issue currently rated
not lower than Aa3 by Moody's or AA- by S&P, Fitch or Duff, or (c) if unrated,
determined by BGFA to be of comparable quality to those rated obligations which
may be purchased by such Master Portfolio.

REPURCHASE AGREEMENTS -- Each Master Portfolio may enter into repurchase
agreements wherein the seller of a security to the Master Portfolio agrees to
repurchase that security from the Master Portfolio at a mutually agreed-upon
time and price. MIP's custodian will have custody of, and will hold in a
segregated account, securities acquired by a Master Portfolio under a
repurchase agreement. Repurchase agreements are considered by the staff of the
Securities and Exchange Commission to be loans by the Master Portfolio entering
into them. In an attempt to reduce the risk of incurring a loss on a
repurchase agreement, each Master Portfolio enters into repurchase agreements
only with federally regulated or insured banks or primary government

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<PAGE> 22
securities dealers reporting to the Federal Reserve Bank of New York or their
affiliates, or, under certain circumstances, banks with total assets in excess
of $5 billion or domestic broker/dealers with total equity capital in excess of
$100 million, with respect to securities of the type in which such Master
Portfolio may invest or government securities regardless of their remaining
maturities, and requires that additional securities be deposited with it if the
value of the securities purchased should decrease below the repurchase price.
BGFA monitors on an ongoing basis the value of the collateral to assure that it
always equals or exceeds the repurchase price. Certain costs may be incurred
by a Master Portfolio in connection with the sale of the securities if the
seller does not repurchase them in accordance with the repurchase agreement.
In addition, if bankruptcy proceedings are commenced with respect to the seller
of the securities disposition of the securities by a Master Portfolio may be
delayed or limited. Each Master Portfolio considers on an ongoing basis the
creditworthiness of the institutions with which it enters into repurchase
agreements.

UNREGISTERED NOTES -- Each Master Portfolio may purchase unsecured promissory
notes ("Notes") which are not readily marketable and have not been registered
under the 1933 Act, provided such investments are consistent with such Master
Portfolio's goal. No Master Portfolio invests more than 15% (10% in the case
of the Money Market Master Portfolio) of the value of its net assets in Notes
and in other illiquid securities.

FLOATING- AND VARIABLE-RATE OBLIGATIONS -- Each Master Portfolio may purchase
floating- and variable-rate demand notes and bonds, which are obligations
ordinarily having stated maturities in excess of 13 months, but which permit
the holder to demand payment of principal at any time, or at specified
intervals not exceeding 13 months. Variable-rate demand notes include master
demand notes which are obligations that permit a Master Portfolio to invest
fluctuating amounts, which may change daily without penalty, pursuant to direct
arrangements between the Master Portfolio, as lender, and the borrower. The
interest rates on these notes fluctuate from time to time. The issuer of such
obligations ordinarily has a corresponding right, after a given period, to
prepay in its discretion the outstanding principal amount of the obligations
plus accrued interest upon a specified number of days' notice to the holders of
such obligations. The interest rate on a floating-rate demand obligation is
based on a known lending rate, such as a bank's prime rate, and is adjusted
automatically each time such rate is adjusted. The interest rate on a
variable-rate demand obligation is adjusted automatically at specified
intervals. Frequently, such obligations are secured by letters of credit or
other credit support arrangements provided by banks. Because these obligations
are direct lending arrangements between the lender and borrower, it is not
contemplated that such instruments generally will be traded. There generally
is no established secondary market for these obligations, although they are
redeemable at face value. Accordingly, where these obligations are not secured
by letters of credit or other credit support arrangements, the Master
Portfolio's right to redeem is dependent on the ability of the borrower to pay
principal and interest on demand. Such obligations frequently are not rated by
credit rating agencies, and each Master Portfolio may invest in obligations
which are not so rated only if BGFA determines that at the time of investment
the obligations are of comparable quality to the other obligations in which
such Master Portfolio may invest. BGFA, on behalf of each Master Portfolio,
considers on an ongoing basis the creditworthiness of the issuers of illiquid
securities including floating- and variable-rate demand obligations in such
Master Portfolio's portfolio. No Master Portfolio will

A-3
<PAGE> 23
invest more than 15% of the value of its total net assets in illiquid
securities, including floating- and variable-rate demand obligations whose
demand feature is not exercisable within seven days. Such obligations will be
treated as liquid, provided that an active secondary market exists.

PARTICIPATION INTERESTS -- Each Master Portfolio may purchase from financial
institutions participation interests in securities in which such Master
Portfolio may invest. A participation interest gives the Master Portfolio an
undivided interest in the security in the proportion that the Master
Portfolio's participation interest bears to the total principal amount of the
security. These instruments may have fixed, floating or variable rates of
interest. If the participation interest is unrated, or has been given a rating
below that which is permissible for purchase by the Master Portfolio, the
participation interest must be backed by an irrevocable letter of credit or
guarantee of a bank, or the payment obligation otherwise must be collateralized
by U.S. Government obligations, or, in the case of unrated participation
interests, BGFA must have determined that the instrument is of comparable
quality to those instruments in which such Master Portfolio may invest. Prior
to a Master Portfolio's purchase of any such instrument backed by a letter of
credit or guarantee of a bank, BGFA evaluates the creditworthiness of the bank,
considering all factors which it deems relevant, which generally may include
review of the bank's cash flow, level of short-term debt, leverage,
capitalization, the quality and depth of management, profitability, return on
assets, and economic factors relative to the banking industry. For certain
participation interests, the Master Portfolio has the right to demand payment,
on not more than seven days' notice, for all or any part of the Master
Portfolio's participation interest in the security, plus accrued interest. As
to these instruments, each Master Portfolio intends to exercise its right to
demand payment only upon a default under the terms of the security, as needed
to provide liquidity to meet redemptions, or to maintain or improve the quality
of its investment portfolio.

MORTGAGE-RELATED SECURITIES -- Each Master Portfolio may invest in
mortgage-related securities ("MBSs"), which are securities representing
interests in a pool of loans secured by mortgages. The resulting cash flow
from these mortgages is used to pay principal and interest on the securities.
MBSs are assembled for sale to investors by various government-sponsored
enterprises such as the Federal National Mortgage Association ("FNMA") and the
Federal Home Loan Mortgage Corporation ("FHLMC") or are guaranteed by such
government agencies as the Government National Mortgage Association ("GNMA").
Regardless of the type of guarantee, all MBSs are subject to interest rate risk
(i.e., exposure to loss due to changes in interest rates).

GNMA MBSs include GNMA Mortgage Pass-Through Certificates ("Ginnie
Maes") which are guaranteed as to the full and timely payment of principal and
interest by GNMA and such guarantee is backed by the authority of GNMA to
borrow funds from the U.S. Treasury to make payments under its guarantee. GNMA
is a wholly-owned U.S. government corporation within the Department of Housing
and Urban Development and, as such, GNMA obligations are obligations of the
United States and are backed by the full faith and credit of the federal
government. In contrast, MBSs issued by FNMA include FNMA Guaranteed Mortgage
Pass-Through Certificates ("Fannie Maes") which are solely the obligations of
FNMA and are neither backed by nor entitled to the full faith and credit of the
federal government. FNMA is a government- sponsored enterprise which is a
private corporation whose stock trades on the NYSE. Fannie Maes are
guaranteed as to timely payment of principal and interest by FNMA.

A-4
<PAGE> 24
MBSs issued by FHLMC include FHLMC Mortgage Participation Certificates
("Freddie Macs" or "PCs"). FHLMC is a government-sponsored enterprise whose
MBSs are solely the obligations of FHLMC. Therefore, Freddie Macs are not
guaranteed by the United States or by any Federal Home Loan Bank and do not
constitute a debt or obligation of the United States or of any Federal Home
Loan Bank. FHLMC guarantees timely payment of interest, but only the ultimate
payment of principal under the obligations it issues. FHLMC may, under certain
circumstances, remit the guaranteed payment of principal at any time after
default on an underlying mortgage, but in no event later than one year after
the guarantee becomes payable.

AMERICAN, EUROPEAN AND CONTINENTAL DEPOSITARY RECEIPTS -- Each Master
Portfolio's assets may be invested in the securities of foreign issuers in the
form of American Depositary Receipts ("ADRs") and European Depositary Receipts
("EDRs"). These securities may not necessarily be denominated in the same
currency as the securities into which they may be converted. ADRs are receipts
typically issued by a United States bank or trust company which evidence
ownership of underlying securities issued by a foreign corporation. EDRs,
which are sometimes referred to as Continental Depositary Receipts ("CDRs"),
are receipts issued in Europe typically by non-United States banks and trust
companies that evidence ownership of either foreign or domestic securities.
Generally, ADRs in registered form are designed for use in the U. S. securities
markets and EDRs and CDRs in bearer form are designed for use in Europe. Each
Master Portfolio may invest in ADRs, EDRs and CDRs through "sponsored" or
"unsponsored" facilities. A sponsored facility is established jointly by the
issuer of the underlying security and a depositary, whereas a depositary may
establish an unsponsored facility without participation by the issuer of the
deposited security. Holders of unsponsored depositary receipts generally bear
all the costs of such facilities and the depositary of an unsponsored facility
frequently is under no obligation to distribute interestholder communications
received from the issuer of the deposited security or to pass through voting
rights to the holders of such receipts in respect of the deposited securities.

CONVERTIBLE SECURITIES -- Each Master Portfolio may purchase fixed-income
convertible securities, such as bonds or preferred stock, which may be
converted at a stated price within a specified period of time into a specified
number of shares of common stock of the same or a different issuer.
Convertible securities are senior to common stock in a corporation's capital
structure, but usually are subordinated to non-convertible debt securities.
While providing a fixed-income stream (generally higher in yield than the
income from a common stock but lower than that afforded by a non-convertible
debt security), a convertible security also affords an investor the
opportunity, through its conversion feature, to participate in the capital
appreciation of the common stock into which it is convertible.

In general, the market value of a convertible security is the
higher of its "investment value" (i.e., its value as a fixed-income security)
or its "conversion value" (i.e., the value of the underlying shares of common
stock if the security is converted). As a fixed-income security, the market
value of a convertible security generally increases when interest rates decline
and generally decreases when interest rates rise. However, the price of a
convertible security also is influenced by the market value of the security's
underlying common stock. Thus, the price of a convertible security generally
increases as the market value of the underlying stock increases and generally

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decreases as the market value of the underlying stock declines. Investments in
convertible securities generally entail less risk than investments in the
common stock of the same issuer.

WARRANTS -- Each Master Portfolio may invest generally up to 5% of its total
net assets at the time of purchase in warrants, except that this limitation
does not apply to warrants acquired in units or attached to securities. A
warrant is an instrument issued by a corporation which gives the holder the
right to subscribe to a specified amount of the corporation's capital stock at
a set price for a specified period of time. The prices of warrants do not
necessarily correlate with the prices of the underlying securities.

ILLIQUID SECURITIES -- Each Master Portfolio may invest up to 15% of the value
of its total net assets in securities as to which a liquid trading market does
not exist, provided such investments are consistent with its investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or contractual
restrictions on resale, participation interests that are not subject to the
demand feature described above, floating- and variable-rate demand obligations
as to which the Master Portfolio cannot exercise the related demand feature
described above on not more than seven days' notice and as to which there is no
secondary market and repurchase agreements providing for settlement in more
than seven days after notice. Disposing of illiquid securities may involve
additional costs and require additional time. However, if a substantial market
of qualified institutional investors develops pursuant to Rule 144A under the
1933 Act, for certain of these securities held by a Master Portfolio, such
Master Portfolio intends to treat such securities as liquid securities in
accordance with procedures approved by MIP's Board of Trustees. Because it is
not possible to predict with assurance how the market for restricted securities
pursuant to Rule 144A will develop, MIP's Board of Trustees has directed BGFA
to monitor carefully each Master Portfolio's investments in such securities
with particular regard to trading activity, availability of reliable price
information and other relevant information. To the extent that for a period of
time, qualified institutional investors cease purchasing such restricted
securities pursuant to Rule 144A, a Master Portfolio's investing in such
securities may have the effect of increasing the level of illiquidity in such
Master Portfolio's portfolio during such period.

INVESTMENT COMPANY SECURITIES -- Each Master Portfolio may invest in securities
issued by other open-end management investment companies which principally
invest in securities of the type in which such Master Portfolio invests. Under
the 1940 Act, a Master Portfolio's investment in such securities currently is
limited to, subject to certain exceptions, (i) 3% of the total voting stock of
any one investment company, (ii) 5% of such Master Portfolio's total net assets
with respect to any one investment company and (iii) 10% of such Master
Portfolio's total net assets in the aggregate. Investments in the securities
of other investment companies involve duplication of advisory fees and certain
other expenses.

RATINGS -- The ratings of Moody's, S&P, Fitch and Duff represent their opinions
as to the quality of the obligations which they undertake to rate. It should
be emphasized, however, that ratings are relative and subjective and, although
ratings may be useful in evaluating the safety of interest and principal
payments, they do not evaluate the market value risk of such obligations.
Therefore, although these ratings may be an initial criterion for selection of
portfolio investments, BGFA also

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evaluates such obligations and the ability of their issuers to pay interest and
principal. Each Master Portfolio relies on BGFA's judgment, analysis and
experience in evaluating the creditworthiness of an issuer. In this
evaluation, BGFA takes into consideration, among other things, the issuer's
financial resources, its sensitivity to economic conditions and trends, the
quality of the issuer's management and regulatory matters. It also is possible
that a rating agency might not timely change the rating on a particular issue
to reflect subsequent events. See Item 4, "General Description of Registrant
- -- Risk Factors -- Fixed-Income Securities."

INVESTMENT TECHNIQUES.

STOCK INDEX OPTIONS -- Each Master Portfolio may purchase and write (i.e.,
sell) put and call options on stock indices as a substitute for comparable
market positions in the underlying securities. A stock index fluctuates with
changes in the market values of the stocks included in the index. The
aggregate premiums paid on all options purchased may not exceed 20% of a Master
Portfolio's total assets and the value of options written or purchased may not
exceed 10% of the value of a Master Portfolio's total assets.

The effectiveness of purchasing or writing stock index options
depends upon the extent to which price movements in the Master Portfolio's
portfolio correlate with price movements of the stock index selected. Because
the value of an index option depends upon movements in the level of the index
rather than the price of a particular stock, whether a Master Portfolio
realizes a gain or loss from purchasing or writing stock options on an index
depends upon movements in the level of stock prices in the stock market
generally or, in the case of certain indices, in an industry or market segment,
rather than movements in the price of a particular stock.

When a Master Portfolio writes an option on a stock index, such
LifePath Master Portfolio places in a segregated account with MIP's custodian
cash or liquid securities in an amount at least equal to the market value of
the underlying stock index and maintains the account while the option is open
or otherwise covers the transaction.

FUTURES TRANSACTIONS -- IN GENERAL -- None of the Master Portfolios is a
commodity pool. To the extent permitted by applicable regulations, each Master
Portfolio is permitted to use futures as a substitute for a comparable market
position in the underlying securities.

A futures contract involves a firm agreement to buy or sell a
commodity or financial instrument at a particular price on a specified future
date. Futures contracts are traded on exchanges, where the exchange serves as
the ultimate counterparty for all contracts. Consequently, the only credit
risk on futures contracts is the creditworthiness of the exchange. Futures
contracts are, however, subject to market risk (i.e., exposure to adverse price
changes).

Each Master Portfolio may trade futures contracts and may purchase
and write options on futures contracts in U.S. domestic markets, such as the
Chicago Board of Trade and the International Monetary Market of the Chicago
Mercantile Exchange, or, to the extent permitted under applicable law, on
exchanges located outside the United States, such as the London

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International Financial Futures Exchange, the Deutscher Aktien index and the
Sydney Futures Exchange Limited. See Item 4, "General Description of
Registrant -- Risk Factors -- Foreign Futures Transactions."

Each Master Portfolio's futures transactions must constitute
permissible transactions pursuant to regulations promulgated by the CFTC. In
addition, a Master Portfolio may not engage in futures transactions if the sum
of the amount of initial margin deposits and premiums paid for unexpired
options on futures contracts other than those contracts entered into for bona
fide hedging purposes, would exceed 5% of the liquidation value of the Master
Portfolio's assets, after taking into account unrealized profits and unrealized
losses on such contracts it has entered into; provided, however, that in the
case of an option that is in-the-money at the time of purchase, the
in-the-money amount may be excluded in calculating this 5% liquidation limit.
Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, a LifePath Master Portfolio may be required to segregate
cash, U.S. Government obligations or other high quality money market
instruments in connection with its futures transactions in an amount generally
equal to the entire value of the underlying commitment.

Initially, when purchasing or selling futures contracts a Master
Portfolio is required to deposit with MIP's custodian in the broker's name an
amount of cash or cash equivalents up to approximately 10% of the contract
amount. This amount is subject to change by the exchange or board of trade on
which the contract is traded. Members of such exchange or board of trade may
impose their own higher requirements. This amount is known as "initial margin"
and is in the nature of a performance bond or good faith deposit on the
contract which is returned to the Master Portfolio upon termination of the
futures position, assuming all contractual obligations have been satisfied.
Subsequent payments to and from the broker, known as "variation margin," are
made daily as the price of the index or securities underlying the futures
contract fluctuates, making the long and short positions in the futures
contract more or less valuable, a process known as "marking-to-market." At any
time prior to the expiration of a futures contract, the LifePath Master
Portfolio may elect to close the position by taking an opposite position, at
the then-prevailing price, thereby terminating its existing position in the
contract.

Although each Master Portfolio may purchase or sell futures
contracts only if there is an active market for such contracts, no assurance
can be given that a liquid market exists for any particular contract at any
particular time. Many futures exchanges and boards of trade limit the amount
of fluctuation permitted in futures contract prices during a single trading
day. Once the daily limit has been reached in a particular contract, no trades
may be made that day at a price beyond that limit or trading may be suspended
for specified periods during the trading day. Futures contract prices could
move to the limit for several consecutive trading days with little or no
trading, thereby preventing prompt liquidation of futures positions and
potentially subjecting the relevant Master Portfolio to substantial losses. If
it is not possible, or the Master Portfolio determines not to close a futures
position in anticipation of adverse price movements, it will be required to
make daily cash payments of variation margin.

An option on a futures contract gives the purchaser the right, in
return for the premium paid, to assume a position in a futures contract (a long
position if the option is a call and

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a short position if the option is a put) at a specified exercise price at any
time during the option exercise period. The writer (i.e., seller) of the
option is required upon exercise to assume an offsetting futures position (a
short position if the option is a call and a long position if the option is a
put). Upon exercise of the option, the assumption of offsetting futures
positions by both the writer and the holder of the option is accompanied by
delivery of the accumulated cash balance in the writer's futures margin account
in the amount by which the market price of the futures contract, at exercise,
exceeds (in the case of a call) or is less than (in the case of a put) the
exercise price of the option on the futures contract.

STOCK INDEX FUTURES AND OPTIONS ON STOCK INDEX FUTURES -- Each Master Portfolio
may purchase and sell stock index futures contracts and options on stock index
futures contracts.

A stock index future obligates the seller to deliver (and the
purchaser to take), effectively, an amount of cash equal to a specific dollar
amount times the difference between the value of a specific stock index at the
close of the last trading day of the contract and the price at which the
agreement is made. No physical delivery of the underlying stocks in the index
is made. With respect to stock indices that are permitted investments, each
Master Portfolio intends to purchase and sell futures contracts on the stock
index for which it can obtain the best price with consideration also given to
liquidity.

INTEREST RATE FUTURES CONTRACTS AND OPTIONS ON INTEREST RATE FUTURES CONTRACTS
- -- Each Master Portfolio may invest in interest rate futures contracts and
options on interest rate futures contracts as a substitute for a comparable
market position in the underlying securities.

Each Master Portfolio also may write options on interest rate
futures contracts as part of closing purchase transactions to terminate its
options positions. No assurance can be given that such closing transactions
can be effected or concerning the degree of correlation between price movements
in the options on interest rate futures and price movements in the LifePath
Master Portfolio's investment portfolio securities which are the subject of the
transaction.

INTEREST RATE AND INDEX SWAPS -- Each Master Portfolio may enter into interest
rate and index swaps in pursuit of its investment objective. Interest rate
swaps involve the exchange by a Master Portfolio with another party of their
respective commitments to pay or receive interest (for example, an exchange of
floating-rate payments for fixed-rate payments). Index swaps involve the
exchange by a Master Portfolio with another party of cash flows based upon the
performance of an index or a portion of an index (usually including dividends
or income). In each case, the exchange commitments can involve payments to be
made in the same currency or in different currencies.

Each Master Portfolio usually enters into swaps on a net basis.
In so doing, only the net difference of the payment obligations is exchanged
between the counterparties. If a Master Portfolio enters into a swap, it
maintains a segregated account in an amount equivalent to the gross value of
its payment obligations unless the contract provides otherwise. If the party
to such a transaction defaults on a swap, the Master Portfolio has contractual
remedies pursuant to the

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agreements related to the transaction. In such a case, the Master Portfolio's
risk of loss consists of the net amount of payments that the Master Portfolio
contractually is entitled to receive.

The use of interest rate and index swaps is a highly specialized
activity which involves investment techniques different from those associated
with ordinary portfolio security transactions. There is no limit, except as
provided below, on the amount of swap transactions that may be entered into by
a Master Portfolio. These transactions generally do not involve the delivery
of securities or other underlying assets or principal. Accordingly, the risk
of loss with respect to swaps generally is limited to the net amount of
payments that the Master Portfolio is contractually obligated to receive. No
Master Portfolio invests more than 15% of the value of its net assets in swaps
that are illiquid, and in other illiquid securities.

FOREIGN CURRENCY TRANSACTIONS -- Each Master Portfolio may engage in currency
exchange transactions either on a spot (i.e., cash) basis at the rate
prevailing in the currency exchange market, or by entering into forward
contracts to purchase or sell currencies. A forward currency exchange contract
involves an obligation between two parties to exchange a specific currency at a
set price on a future date, which must be more than two days from the date of
the contract. These contracts are entered into in the interbank market
conducted directly between currency traders (typically commercial banks or
other financial institutions) and their customers.

Each Master Portfolio may combine forward currency exchange
contracts with investments in securities denominated in other currencies.

Each Master Portfolio also may maintain short positions in forward
currency exchange transactions, which would involve the Master Portfolio
agreeing to exchange an amount of a currency it did not currently own for
another currency at a future date in anticipation of a decline in the value of
the currency sold relative to the currency such Master Portfolio contracted to
receive in the exchange.

LENDING PORTFOLIO SECURITIES -- From time to time, each Master Portfolio may
lend securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain transactions.
Such loans may not exceed one-third of the value of the relevant Master
Portfolio's total assets. In connection with such loans, each Master Portfolio
receives collateral consisting of cash, U.S. Government obligations or other
high-quality debt instruments. which are maintained at all times in an amount
equal to at least 100% of the current market value of the loaned securities.
Each Master Portfolio can increase its income through the investment of such
collateral. Each Master Portfolio continues to be entitled to payments in
amounts equal to the dividends, interest and other distributions payable on the
loaned security and receives interest on the amount of the loan. Such loans
are terminable at any time upon specified notice. A Master Portfolio might
experience risk of loss if the institution with which it has engaged in a
portfolio loan transaction breaches its agreement with such Master Portfolio.

FORWARD COMMITMENTS -- Each Master Portfolio may purchase securities on a
when-issued or forward commitment basis, which means that the price is fixed at
the time of commitment but delivery and payment ordinarily take place a number
of days after the date of the commitment to

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purchase. A Master Portfolio makes commitments to purchase such securities
only with the intention of actually acquiring the securities, but the Master
Portfolio may sell these securities before the settlement date if it is deemed
advisable. The Master Portfolio accrue income in respect of a security
purchased on a forward commitment basis prior to its stated delivery date.

Securities purchased on a when-issued or forward commitment basis
and certain other securities held in the Master Portfolio's investment
portfolio are subject to changes in value (both generally changing in the same
way, i.e., appreciating when interest rates decline and depreciating when
interest rates rise) based upon the public's perception of the creditworthiness
of the issuer and changes, real or anticipated, in the level of interest rates.
Securities purchased on a when-issued or forward commitment basis may expose
the relevant Master Portfolio to risk because they may experience such
fluctuations prior to their actual delivery. Purchasing securities on a
when-issued or forward commitment basis can involve the additional risk that
the yield available in the market when the delivery takes place actually may be
higher than that obtained in the transaction itself. A segregated account of
each Master Portfolio consisting of cash, U.S. Government obligations or other
high-quality liquid debt securities at least equal at all times to the amount
of the when-issued or forward commitments is established and maintained at
MIP's custodian bank. Purchasing securities on a forward commitment basis when
a Master Portfolio is fully or almost fully invested may result in greater
potential fluctuation in the value of such Master Portfolio's total net assets
and its net asset value per share.

BORROWING MONEY -- As a fundamental policy, each Master Portfolio is permitted
to borrow to the extent permitted under the 1940 Act. However, each Master
Portfolio currently intends to borrow money only for temporary or emergency
(not leveraging) purposes, in an amount up to one-third of the value of its
total assets (including the amount borrowed) valued at the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time the
borrowing is made. While borrowings exceed 5% of a Master Portfolio's total
assets, such Master Portfolio will not make any investments.

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MASTER INVESTMENT PORTFOLIO
ALLOCATION MASTER PORTFOLIOS

ASSET ALLOCATION MASTER PORTFOLIO
U.S. TREASURY ALLOCATION MASTER PORTFOLIO

PART A

June 28, 1996

Responses to Items 1 through 3 have been omitted pursuant to paragraph 4 of
Instruction F of the General Instructions to Form N-1A.

Item 4. General Description of Registrant.

GENERAL. Master Investment Portfolio ("MIP") is an open-end, management
investment company, organized on October 21, 1993 as a business trust under the
laws of the State of Delaware. MIP is a "series fund," which is a mutual fund
divided into separate portfolios. By this offering document, MIP is offering
two diversified portfolios (each, a "Master Portfolio"). Each Master
Portfolio is treated as a separate entity for certain matters under the
Investment Company Act of 1940, as amended (the "1940 Act"), and for other
purposes an interestholder of one Master Portfolio is not deemed to be an
interestholder of the other Master Portfolio. As described below, for certain
matters MIP interestholders vote together as a group; as to others they vote
separately by Master Portfolio. MIP currently offers nine other portfolios
pursuant to other offering documents. From time to time, other portfolios may
be established and sold pursuant to other offering documents.

BZW Barclays Global Fund Advisors ("BGFA") serves as investment adviser
to each Master Portfolio. Prior to January 1, 1996, Wells Fargo Bank, N.A.
("Wells Fargo Bank") served as each Master Portfolio's investment adviser and
Wells Fargo Nikko Investment Advisors ("WFNIA") served as each Master
Portfolio's sub-investment adviser. The Master Portfolios do not currently
retain a sub-adviser. BGFA was created by the reorganization of WFNIA with and
into an affiliate of Wells Fargo Institutional Trust Company ("WFITC"). BGFA
is now a subsidiary of WFITC which, effective January 1, 1996, changed its name
to BZW Barclays Global Investors, N.A. ("BGI").

Beneficial interests in each Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering"
within the meaning of Regulation D under the Securities Act of 1933, as amended
(the "1933 Act"). Investments in a Master Portfolio may be made only by
investment companies or certain other entities which are "accredited investors"
within the meaning of Regulation D under the 1933 Act. This registration
statement does not constitute an offer to sell, or the solicitation of an offer
to buy, any "security" within the meaning of the 1933 Act.

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INVESTMENT OBJECTIVES.

o The ASSET ALLOCATION MASTER PORTFOLIO seeks to maximize total
return, consisting of capital appreciation and current income, without assuming
undue risk. This Master Portfolio will follow an asset allocation strategy by
investing in a wide range of publicly traded common stocks, U.S. Treasury bonds
and money market instruments.

o The U.S. TREASURY ALLOCATION MASTER PORTFOLIO seeks to
maximize total return, consisting of capital appreciation and current income,
without assuming undue risk. This Master Portfolio will follow an asset
allocation strategy by investing primarily among long-, intermediate- and
short-term U.S. Treasury securities.

The investment objective of each Master Portfolio cannot be changed
without approval by the holders of a majority (as defined in the 1940 Act) of
such Master Portfolio's outstanding voting securities. The differences in
investment objectives and policies between each Master Portfolio determines the
types of portfolio securities in which each Master Portfolio invests and can be
expected to affect the degree of risk to which each Master Portfolio is subject
and the yield or return of each Master Portfolio. There can be no assurance
that the investment objective of each Master Portfolio will be achieved.

MANAGEMENT POLICIES.

The Asset Allocation Master Portfolio and U.S. Treasury Allocation Master
Portfolio each follow an asset allocation strategy. For each Master Portfolio,
BGFA uses proprietary investment models ("Asset Allocation Models"), developed
by WFNIA that analyze extensive financial and economic data, including risk,
correlation and expected return statistics, to recommend a portfolio allocation
as described below. BGFA may, from time to time, develop and refine the Asset
Allocation Models.

ASSET ALLOCATION MASTER PORTFOLIO will invest its assets among
three asset classes -- common stocks, U.S. Treasury bonds and money market
instruments -- as follows.

o COMMON STOCKS. The Master Portfolio will invest
in the common stocks which compose the Standard & Poor's 500
Stock Index (the "S&P 500 Index"). The S&P 500 Index is
composed of 500 common stocks, most of which are listed on the
New York Stock Exchange. The weightings of stocks in the S&P
500 Index are based on each stock's relative total market
capitalization; that is, its market price per share times the
number of shares outstanding. No attempt is made to manage
this portion of the Master Portfolio's investment portfolio in
the traditional sense using economic, financial and market
analysis. Instead, the

__________________________________

* S&P does not sponsor the Master Portfolio, nor is it affiliated in any
way with BGFA or the Master Portfolio. "Standard & Poor's ," "S&P ," "S&P
500," and "Standard & Poor's 500 " are trademarks of McGraw-Hill, Inc. The
Master Portfolio is not sponsored, endorsed, sold, or promoted by S&P and S&P
makes no representation or warranty, express or implied, regarding the
advisability of investing in the Master Portfolio.

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Master Portfolio uses for this portion of its portfolio a
computer program to determine which securities are to be
purchased or sold to replicate the total return performance of
the S&P 500 Index to the extent feasible. The percentage of
the Asset Allocation Master Portfolio's assets invested in
each stock will be approximately the same as the percentage
such stock represents in the S&P 500 Index.

o U.S. TREASURY BONDS. The Master Portfolio will
invest in U.S. Treasury bonds with remaining maturities of at
least 20 years. Under normal market conditions, the
dollar-weighted average maturity of this portion of the Master
Portfolio's investment portfolio is expected to range between
22 and 28 years. The Master Portfolio will invest this
portion of its assets in an effort to replicate the total
return performance of the Lehman Brothers 20+ Year Treasury
Index which is composed of U.S. Treasury securities with 20
years or more to maturity.

o MONEY MARKET INSTRUMENTS. The Master Portfolio
will invest in money market instruments.

THE U.S. TREASURY ALLOCATION MASTER PORTFOLIO will invest its
assets among three maturity classes -- long, intermediate and short-term -- of
U.S. Treasury debt securities and repurchase agreements in respect thereof as
follows:

o LONG-TERM U.S. TREASURY BONDS. The Master
Portfolio will invest in U.S. Treasury bonds with remaining
maturities of at least 20 years. Under normal market
conditions, the dollar-weighted average maturity of this
portion of the Master Portfolio's investment portfolio is
expected to range between 22 and 28 years.

o INTERMEDIATE-TERM U.S. TREASURY NOTES. The
Master Portfolio will invest in U.S. Treasury notes and other
U.S. Treasury securities with remaining maturities ranging
from one to 20 years. Under normal market conditions, the
dollar-weighted average maturity of this portion of the Master
Portfolio's investment portfolio is expected to range between
three and seven years.

o SHORT-TERM U.S. TREASURY BILLS. The Master
Portfolio will invest in U.S. Treasury bills with remaining
maturities of one year or less. Under normal market
conditions, the dollar-weighted average maturity of this
portion of the Master Portfolio's investment portfolio is
expected to range between 30 and 90 days.

It is a fundamental policy of the U.S. Treasury Allocation
Master Portfolio that it will invest at least 65% of the value of its total
assets in U.S. Treasury securities.

CERTAIN FUNDAMENTAL POLICIES. Each Master Portfolio may (i) borrow money to
the extent permitted under the 1940 Act except that each Master Portfolio may
borrow up to 20% of the

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current value of its net assets for temporary purposes only in order to meet
redemptions; (ii) invest up to 5% of its total assets in the obligations of any
single issuer, except that up to 25% of the value of the total assets of such
Master Portfolio may be invested, and obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities may be purchased, without
regard to any such limitation; and (iii) invest up to 25% of the value of its
total assets in the securities of issuers in a particular industry or group of
closely related industries, subject to certain exceptions specified in Part B,
including that there is no limitation on the purchase of obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities. This
paragraph describes fundamental policies that cannot be changed as to a Master
Portfolio without approval by the holders of a majority (as defined in the 1940
Act) of such Master Portfolio's outstanding voting securities. See Item 13,
"Investment Objectives and Policies -- Investment Restrictions," in Part B.

CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICIES. Each Master Portfolio may (i)
purchase securities of any company having less than three years' continuous
operation (including operations of any predecessors), provided that the
securities are fully guaranteed or insured by the U.S. Government, a state,
commonwealth, possession, territory, the District of Columbia or by an entity
in existence at least three years, or the securities are backed by the assets
and revenues of any of the foregoing, if such purchase does not cause the value
of its investments in all such companies to exceed 5% of the value of its total
assets; (ii) pledge, hypothecate, mortgage or otherwise encumber its assets,
but only to secure permitted borrowings; and (iii) invest up to 15% of the
value of its net assets in repurchase agreements providing for settlement in
more than seven days after notice and in other illiquid securities. See Item
13, "Investment Objectives and Policies -- Investment Restrictions," in Part B.

RISK FACTORS.

GENERAL -- The net asset value per share of each Master Portfolio is not fixed
and is expected to fluctuate.

INVESTMENT TECHNIQUES -- Each Master Portfolio may engage in various investment
techniques the use of which involves risk. See "Appendix--Investment
Techniques." Using these techniques may affect the degree to which a Master
Portfolio's net asset value fluctuates.

EQUITY SECURITIES -- (Asset Allocation Master Portfolio) Investors should be
aware that equity securities fluctuate in value, often based on factors
unrelated to the value of the issuer of the securities, and that fluctuations
can be pronounced. Changes in the value of a Master Portfolio's portfolio
securities will result in changes in the value of such Master Portfolio's
shares and the Master Portfolio's yield and total return to investors.

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greater than its cost. In either instance, if the security was purchased at
face value and held to maturity, no gain or loss would be realized. The value
of U.S. Treasury securities also will be affected by the supply and demand, as
well as the perceived supply and demand, for such securities. Long-term
securities are affected to a greater extent by interest rates than shorter-term
securities.

FOREIGN SECURITIES -- (Asset Allocation Master Portfolio) Since the stocks of
some foreign issuers are included in the S&P 500 Index, the portfolio of the
Asset Allocation Master Portfolio may contain securities of such foreign
issuers which may subject the Master Portfolio to additional investment risks
with respect to those securities that are different in some respects from those
incurred by a fund which invests only in securities of domestic issuers. Such
risks include future political and economic developments, the possible
imposition of withholding taxes on income payable on the securities, the
possible establishment of exchange controls or the adoption of other foreign
governmental restrictions which might adversely affect an investment in these
securities and the possible seizure or nationalization of foreign deposits.

OTHER INVESTMENT CONSIDERATIONS -- Asset allocation and modeling strategies are
employed by BGFA for other investment companies and accounts advised or
sub-advised by BGFA. If these strategies indicate particular securities should
be purchased or sold, at the same time, by a Master Portfolio and one or more
of these investment companies or accounts, available investments or
opportunities for sales are allocated equitably to each by the investment
advice. In some cases, this procedure may adversely affect the size of the
position obtained for or disposed of by a Master Portfolio or the price paid or
received by such Master Portfolio.

Under normal market conditions, the portfolio turnover rate for
each Master Portfolio is expected to be under 100%. A portfolio turnover rate
of 100% would occur, for example, if all of a Master Portfolio's securities
were replaced within one year. Higher portfolio turnover rates are likely to
result in comparatively greater brokerage commissions. In addition, short-term
gains realized from portfolio transactions are taxable to shareholders as
ordinary income. Portfolio turnover will not otherwise be a limiting factor in
making investment decisions.

Item 5. Management of the Master Portfolios.

INVESTMENT ADVISER -- Pursuant to separate investment advisory contracts (the
"BGFA Advisory Contracts") dated January 1, 1996, BGFA serves as investment
adviser to each Master Portfolio. BGFA is an indirect subsidiary of Barclays
Bank PLC ("Barclays") and is located at 45 Fremont Street, San Francisco, CA
94105. As of March 31, 1996, BGFA and its affiliates provided investment
advisory services for over $284 billion of assets under management.

The BGFA Advisory Contracts provide that BGFA shall furnish to
each Master Portfolio investment guidance and policy direction in connection
with the daily portfolio management of such Master Portfolio, subject to the
supervision of MIP's Board of Trustees and in conformity with Delaware law and
the stated policies of each Master Portfolio. Pursuant to the BGFA Advisory
Contracts, BGFA furnishes to MIP's Board of Trustees periodic reports on the
investment strategy and performance of each Master Portfolio. BGFA continues
to employ substantially the same WFNIA investment professionals that previously
managed the investment

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portfolio of each Master Portfolio.

BGFA is entitled to receive monthly fees at the annual rate of
0.35% and 0.30% of the average daily net assets of the Asset Allocation Master
Portfolio and U.S. Treasury Allocation Master Portfolio, respectively, as
compensation for its advisory services. From time to time, BGFA may waive such
fees in whole or in part. Any such waiver will reduce the expenses of a Master
Portfolio and, accordingly, have a favorable impact on the performance of such
Master Portfolio. For the period from January 1, 1996 to February 29, 1996,
BGFA received amounts equal to 0.35% and 0.30% of the average daily net assets
of the Asset Allocation and U.S. Treasury Allocation Master Portfolios,
respectively, as compensation for its advisory services.

BGFA may deal, trade and invest for its own account in the
types of securities in which each Master Portfolio may invest. BGFA has
informed MIP that in making its investment decisions it does not obtain or use
material inside information in its possession.

Prior to January 1, 1996, Wells Fargo Bank, a wholly owned
subsidiary of Wells Fargo & Company located at 420 Montgomery Street, San
Francisco, California 94105, served as each Master Portfolio's investment
adviser. Pursuant to an Investment Advisory Agreement with MIP, Wells Fargo
Bank provided investment guidance and policy direction in connection with the
management of each Master Portfolio's assets, subject to the supervision of
MIP's Board of Trustees and in conformity with Delaware law and the stated
policies of such Master Portfolio. The BGFA Advisory Contracts are identical
in all material respects, other than the identity of the parties, to the
Investment Advisory Agreement with Wells Fargo Bank. The Investment Advisory
Agreement with Wells Fargo Bank terminated as of January 1, 1996. Under the
terms of the prior Investment Advisory Agreement, MIP was contractually
obligated to pay a monthly fee on behalf of each Master Portfolio at the annual
rate of 0.35% and 0.30% of the average daily net assets of the Asset Allocation
and U.S. Treasury Allocation Master Portfolios, respectively. For the period
beginning March 1, 1995 and ended December 31, 1995 Wells Fargo Bank actually
was paid monthly fees at the annual rate of 0.35% and 0.30% of the average
daily net assets of the Asset Allocation and U.S. Treasury Allocation Master
Portfolios, respectively, for its services as investment adviser to such Master
Portfolio.

Prior to January 1, 1996, Wells Fargo Bank engaged WFNIA,
located at 45 Fremont Street, San Francisco, California 94105, to provide
sub-investment advisory services to each Master Portfolio. WFNIA was a general
partnership, which was dissolved on December 31, 1995, owned 50% by a wholly
owned subsidiary of Wells Fargo Bank and 50% by a subsidiary of The Nikko
Securities Co., Ltd. Pursuant to a Sub-Investment Advisory Agreement, WFNIA,
provided investment advisory assistance and the day-to-day management of each
Master Portfolio's assets, subject to the supervision and approval of Wells
Fargo Bank and the overall authority of MIP's Board of Trustees and in
conformity with Delaware law and the stated policies of such Master Portfolio.
Wells Fargo Bank was contractually obligated to pay WFNIA a monthly fee at the
annual rate of 0.20% and 0.15%, of the average daily net assets of the Asset
Allocation and U.S. Treasury Allocation Master Portfolios, respectively. For
the period beginning March 1, 1995 and ended December 31, 1995, WFNIA actually
was paid by Wells Fargo Bank sub-advisory fees at the annual rate of 0.20% and
0.15%, of the average daily net assets of the Asset Allocation and U.S.
Treasury Allocation Master Portfolios, respectively.

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As investment adviser, Wells Fargo Bank was permitted to deal,
trade and invest for its own account in the types of securities in which the
Master Portfolio invested and may have had deposit, loan and commercial banking
relationships with the issuers of securities purchased by a Master Portfolio.
Wells Fargo Bank informed MIP that in making its investment decisions it does
not obtain or use material inside information in its possession.

Morrison & Foerster LLP, counsel to MIP and special counsel to
BGFA, has advised MIP and BGFA that BGFA and its affiliates may perform the
services contemplated by the BGFA Advisory Contracts and this Part A without
violation of the Glass-Steagall Act. Such counsel has pointed out, however,
that there are no controlling judicial or administrative interpretations or
decisions and that future judicial or administrative interpretations of, or
decisions relating to, present federal or state statutes, including the
Glass-Steagall Act, and regulations relating to the permissible activities of
banks and their subsidiaries or affiliates, as well as future changes in such
statutes, regulations and judicial or administrative decisions or
interpretations, could prevent such entities from continuing to perform, in
whole or in part, such services. If any such entity were prohibited from
performing any such services, it is expected that new agreements would be
proposed or entered into with another entity or entities qualified to perform
such services.

ADMINISTRATOR AND PLACEMENT AGENT -- Stephens Inc. ("Stephens"), located at 111
Center Street, Little Rock, Arkansas 72201, serves as the Master Portfolio's
administrator pursuant to an Administration Agreement with MIP. Under the
Administration Agreement, Stephens provides general supervision of the
operation of MIP and the Master Portfolios, other than the provision of
investment advice, subject to the overall authority of MIP's Board of Trustees.
The administrative services provided to the Master Portfolios also include
coordination of the other services provided to the Master Portfolios,
compilation of information for reports to the Securities and Exchange
Commission and state securities commissions, preparation of proxy statements
and interestholder reports, and general supervision of data compilation in
connection with preparing periodic reports to MIP's Board of Trustees and
officers. Stephens also furnishes office space and certain facilities to
conduct MIP's business, and compensates MIP's Trustees, officers and employees
who are affiliated with Stephens. Stephens is not entitled to compensation for
providing administrative services to a Master Portfolio so long as Stephens
receives fees for providing similar services to a fund of another registered
investment company that invests all of its assets in the Master Portfolio.
Stephens also serves as placement agent for each Master Portfolio's shares.

Stephens is a full service broker/dealer and investment
advisory firm. Stephens and its predecessor have been providing securities and
investment services for more than 50 years, including discretionary portfolio
management services since 1983. Stephens currently manages investment
portfolios for pension and profit sharing plans, individual investors,
foundations, insurance companies and university endowments.

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Institutional Trust Company, N.A. ("WFITC") and WFNIA and Wells Fargo & Company
together held 100% of WFITC's outstanding voting securities. Wells Fargo Bank
is each Master Portfolio's Transfer and Dividend Disbursing Agent (the
"Transfer Agent"). The principle business address of Wells Fargo Bank is 525
Market Street, San Francisco, California 94105.

EXPENSES. All expenses incurred in the operation of MIP are borne by MIP ,
except to the extent specifically assumed by BGFA (or, prior to January 1, 1996
by Wells Fargo Bank) and Stephens. Expenses attributable to a particular
Master Portfolio are charged against the assets of that Master Portfolio; other
expenses of MIP are allocated among the Master Portfolios on the basis
determined by the Board of Trustees, including, but not limited to,
proportionately in relation to the net assets of each Master Portfolio.

Item 6. Capital Stock and Other Securities.

MIP is organized as a trust under the laws of the State of
Delaware. Investors in MIP will each be liable for all obligations of MIP.
However, the risk of an investor incurring financial loss on account of such
liability is limited to circumstances in which both inadequate insurance
existed and MIP itself was unable to meet its obligations.

To date, the Board of Trustees has authorized the creation of
fourteen separate series. All consideration received by MIP for shares of one
of the series and all assets in which such consideration is invested will
belong to that series (subject only to the rights of creditors of MIP) and will
be subject to the liabilities related thereto. The income attributable to, and
the expenses of, one series are treated separately from those of the other
series. MIP may create, from time to time, new series without shareholder
approval.

INTERESTS IN A MASTER PORTFOLIO ARE NOT DEPOSITS OR OBLIGATIONS
OF, OR GUARANTEED OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY
OTHER AGENCY. INVESTMENT IN A MASTER PORTFOLIO INVOLVES CERTAIN INVESTMENT
RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. THE SHARE PRICE AND
INVESTMENT RETURN OF EACH MASTER PORTFOLIO IS EXPECTED TO FLUCTUATE AND
INVESTMENTS IN THE MASTER PORTFOLIOS ARE NOT GUARANTEED.

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<PAGE> 39
meeting of interestholders for purposes of removing a Trustee from office. MIP
interestholders may remove a Trustee by the affirmative vote of a majority of
MIP's outstanding voting securities. In addition, the Board of Trustees will
call a meeting of interestholders for the purpose of electing Trustees if, at
any time, less than a majority of the Trustees then holding office have been
elected by interestholders. Investments in a Master Portfolio may not be
transferred, but an investor may withdraw all or any portion of its investment
at any time at net asset value.

Under MIP's anticipated classification for federal income tax
purposes, each Master Portfolio will be treated as a nonpublicly traded
partnership, and, therefore, will not be subject to any income tax. However,
each investor in a Master Portfolio will be taxable on its allocable share (as
determined in accordance with the governing instruments of MIP) of such Master
Portfolio's ordinary income and capital gain in determining its income tax
liability. The determination of such share will be made in accordance with the
Internal Revenue Code of 1986, as amended (the "Code"), and regulations
promulgated thereunder.

It is expected that each Master Portfolio will be managed so
that each investment company that invests substantially all of its assets in a
Master Portfolio will qualify as a "regulated investment company" under the
Code.

As of June 1, 1996, the Asset Allocation Fund and U.S. Treasury
Allocation Fund of MasterWorks Funds Inc. (formerly, Stagecoach Inc.), 111
Center Street, Little Rock, Arkansas 72201, owned approximately 99% of the
outstanding voting securities of the Asset Allocation Master Portfolio and
approximately 99% of the outstanding voting securities of the U.S. Treasury
Allocation Master Portfolio, respectively, and each Fund could be considered a
controlling person of the corresponding Master Portfolio for purposes of the
1940 Act.

Item 7. Purchase of Securities.

Beneficial interests in each Master Portfolio are issued solely
in private placement transactions which do not involve any "public offering"
within the meaning of Section 4(2) of the 1933 Act. Investments in a Master
Portfolio may be made only by investment companies or certain other entities
which are "accredited investors" within the meaning of Regulation D under the
Securities Act of 1933, as amended. This registration statement does not
constitute an offer to sell, or the solicitation of an offer to buy, any
"security" within the meaning of the Securities Act of 1933, as amended.

Shares of each Master Portfolio are sold on a continuous basis
at the net asset value per share next determined after an order in proper form
is received by the Transfer Agent. Net asset value per share for each Master
Portfolio is determined as of the close of trading of the New York Stock
Exchange (currently 4:00 p.m., Eastern Standard Time), on each day the New York
Stock Exchange is open for business (a "Business Day"). Net asset value per
share is computed by dividing the value of the Master Portfolio's net assets
(i.e., the value of its assets less liabilities) by the total number of shares
of such Master Portfolio outstanding. Each Master Portfolio's investments are
valued each Business Day generally by using available market quotations or at
fair value determined in good faith by MIP's Board of Trustees. For further

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<PAGE> 40
information regarding the methods employed in valuing each Master Portfolio's
investments, see Item 19, "Purchase, Redemption and Pricing of Securities" in
Part B.

Item 8. Redemption or Repurchase.

An investor in MIP may withdraw all or any portion of its
investment on any Business Day at the net asset value next determined after a
withdrawal request in proper form is furnished by the investor to the Transfer
Agent. When a request is received in proper form, the Master Portfolio will
redeem the shares at the next determined net asset value.

Each Master Portfolio will make payment for all shares redeemed
within three days after receipt by the Transfer Agent of a redemption request
in proper form, except as provided by the rules of the Securities and Exchange
Commission. Investments in a Master Portfolio may not be transferred.

The right of any investor to receive payment with respect to
any withdrawal may be suspended or the payment of the withdrawal proceeds
postponed during any period in which the New York Stock Exchange is closed
(other than weekends or holidays) or trading on such Exchange is restricted,
or, to the extent otherwise permitted by the 1940 Act, if an emergency exists.

Item 9. Pending Legal Proceedings.

Not applicable.

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APPENDIX

PORTFOLIO SECURITIES.

To the extent set forth in this offering document, each Master
Portfolio may invest in the securities described below.

U.S. GOVERNMENT OBLIGATIONS -- The Asset Allocation Master Portfolio and U.S.
Treasury Allocation Master Portfolio may invest in various types of U.S.
Government obligations with remaining maturities of up to one year. U.S.
Government obligations include securities issued or guaranteed as to principal
and interest by the U.S. Government and supported by the full faith and credit
of the U.S. Treasury. U.S. Treasury obligations differ mainly in the length of
their maturity. Treasury bills, the most frequently issued marketable
government securities, have a maturity of up to one year and are issued on a
discount basis. U.S. Government obligations also include securities issued or
guaranteed by federal agencies or instrumentalities, including
government-sponsored enterprises. Some obligations of such agencies or
instrumentalities of the U.S. Government are supported by the full faith and
credit of the United States or U.S. Treasury guarantees; others, by the right
of the issuer or guarantor to borrow from the U.S. Treasury; still others by
the discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others, only by the credit of
the agency or instrumentality issuing the obligation. In the case of
obligations not backed by the full faith and credit of the United States, the
investor must look principally to the agency or instrumentality issuing or
guaranteeing the obligation for ultimate repayment, which agency or
instrumentality may be privately owned. There can be no assurance that the
U.S. Government would provide financial support to its agencies or
instrumentalities (including government-sponsored enterprises) where it is not
obligated to do so. In addition, U.S. Government obligations are subject to
fluctuations in market value due to fluctuations in market interest rates. As
a general matter, the value of debt instruments, including U.S. Government
obligations, declines when market interest rates increase and rises when market
interest rates decrease. Certain types of U.S. Government obligations are
subject to fluctuations in yield or value due to their structure or contract
terms.

FOREIGN GOVERNMENT OBLIGATIONS; SECURITIES OF SUPRANATIONAL ENTITIES -- Each
Master Portfolio, through its investment in money market instruments, may
invest in obligations issued or guaranteed by one or more foreign governments
or any of their political subdivisions, agencies or instrumentalities that are
determined by BGFA to be of comparable quality to the other obligations in
which such Master Portfolio may invest. Such securities also include debt
obligations of supranational entities. Supranational entities include
international organizations designated or supported by governmental entities to
promote economic reconstruction or development and international banking
institutions and related government agencies. Examples include the
International Bank for Reconstruction and Development (the World Bank), the
European Coal and Steel Community, the Asian Development Bank and the
InterAmerican Development Bank. The percentage of a Master Portfolio's assets
invested in securities issued by foreign governments will vary depending on the
relative yields of such securities, the economic and financial markets of the
countries in which the investments are made and the interest rate climate of
such countries.

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BANK OBLIGATIONS -- Each Master Portfolio may invest in bank obligations,
including certificates of deposit, time deposits, bankers' acceptances and
other short-term obligations of domestic banks, foreign subsidiaries of
domestic banks, foreign branches of domestic banks, and domestic and foreign
branches of foreign banks, domestic savings and loan associations and other
banking institutions. With respect to such securities issued by foreign
branches of domestic banks, foreign subsidiaries of domestic banks, and
domestic and foreign branches of foreign banks, a Master Portfolio may be
subject to additional investment risks that are different in some respects from
those incurred by a fund which invests only in debt obligations of U.S.
domestic issuers. Such risks include possible future political and economic
developments, the possible imposition of foreign withholding taxes on interest
income payable on the securities, the possible establishment of exchange
controls or the adoption of other foreign governmental restrictions which might
adversely affect the payment of principal and interest on these securities and
the possible seizure or nationalization of foreign deposits.

Certificates of deposit are negotiable certificates evidencing
the obligation of a bank to repay funds deposited with it for a specified
period of time.

Time deposits are non-negotiable deposits maintained in a
banking institution for a specified period of time at a stated interest rate.
Time deposits which may be held by a Master Portfolio will not benefit from
insurance from the Bank Insurance Fund or the Savings Association Insurance
Fund administered by the Federal Deposit Insurance Corporation.

COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS -- Each Master
Portfolio may invest in commercial paper, which consists of short-term,
unsecured promissory notes issued to finance short-term credit needs. The
commercial paper purchased by a Master Portfolio will consist only of direct
obligations which, at the time of their purchase, are (a) rated not lower than
Prime-1 by Moody's, A-1 by S&P, F-1 by Fitch or Duff-1 by Duff, (b) issued by
companies having an outstanding unsecured debt issue currently rated not lower
than Aa3 by Moody's or AA- by S&P, Fitch or Duff, or (c) if unrated, determined
by BGFA to be of comparable quality to those rated obligations which may be
purchased by such Fund.

REPURCHASE AGREEMENTS -- Each Master Portfolio may enter into repurchase
agreements wherein the seller of a security to the Master Portfolios agrees to
repurchase that security from the Master Portfolio at a mutually agreed-upon
time and price. MIP's custodian has custody of, and holds in a segregated
account, securities acquired as collateral by a Master Portfolio under a
repurchase agreement. Repurchase agreements are considered by the staff of the
Securities and Exchange Commission to be loans by the Master Portfolio. In an
attempt to reduce the risk of incurring a loss on a repurchase agreement, each
Master Portfolio enters into repurchase agreements only with federally
regulated or insured banks or primary government securities dealers reporting
to the Federal Reserve Bank of New York or, under certain circumstances,

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banks with total assets in excess of $5 billion or domestic broker/dealers with
total equity capital in excess of $100 million. The Master Portfolios may
enter into repurchase agreements only with respect to securities of the type in
which such Master Portfolio may invest, including government securities and
mortgage-related securities, regardless of their remaining maturities, and
requires that additional securities be deposited with the custodian if the
value of the securities purchased should decrease below resale price. BGFA
monitor on an ongoing basis the value of the collateral to assure that it
always equals or exceeds the repurchase price. Certain costs may be incurred
by a Master Portfolio in connection with the sale of the underlying securities
if the seller does not repurchase them in accordance with the repurchase
agreement. In addition, if bankruptcy proceedings are commenced with respect
to the seller of the securities, disposition of the securities by a Master
Portfolio may be delayed or limited. Each Master Portfolio considers on an
ongoing basis the creditworthiness of the institutions with which it enters
into repurchase agreements.

UNREGISTERED NOTES -- Each Master Portfolio may purchase unsecured promissory
notes ("Notes") which are not readily marketable and have not been registered
under the Securities Act of 1933, as amended, provided such investments are
consistent with such Master Portfolio's investment objective.

FLOATING- AND VARIABLE-RATE OBLIGATIONS -- Each Master Portfolio may purchase
floating- and variable-rate demand notes and bonds, which are obligations
ordinarily having stated maturities in excess of thirteen months, but which
permit the holder to demand payment of principal at any time, or at specified
intervals not exceeding thirteen months. Variable rate demand notes include
master demand notes which are obligations that permit a Master Portfolio to
invest fluctuating amounts, which may change daily without penalty, pursuant to
direct arrangements between the Master Portfolio, as lender, and the borrower.
The interest rates on these notes fluctuate from time to time. The issuer of
such obligations ordinarily has a corresponding right, after a given period, to
prepay in its discretion the outstanding principal amount of the obligations
plus accrued interest upon a specified number of days' notice to the holders of
such obligations. The interest rate on a floating-rate demand obligation is
based on a known lending rate, such as a bank's prime rate, and is adjusted
automatically each time such rate is adjusted. The interest rate on a
variable-rate demand obligation is adjusted automatically at specified
intervals. Frequently, such obligations are secured by letters of credit or
other credit support arrangements provided by banks. Because these obligations
are direct lending arrangements between the lender and borrower, it is not
contemplated that such instruments generally will be traded, and there
generally is no established secondary market for these obligations, although
they are redeemable at face value. Accordingly, where these obligations are
not secured by letters of credit or other credit support arrangements, the
Master Portfolio's right to redeem is dependent on the ability of the borrower
to pay principal and interest on demand. Such obligations frequently are not
rated by credit rating agencies and each Master Portfolio may invest in
obligations which are not so rated only if BGFA determines that at the time of
investment the obligations are of comparable quality to the other obligations
in which such Master Portfolio may invest. BGFA, on behalf of each Master
Portfolio, considers on an ongoing basis the creditworthiness of the issuers of
the floating- and variable-rate demand obligations in such Master Portfolio's
portfolio. No Master Portfolio will invest more than 15% of the value of its
total net assets in floating- or variable-rate demand obligations whose demand
feature is not exercisable within seven days. Such obligations

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may be treated as liquid, provided that an active secondary market exists.

PARTICIPATION INTERESTS -- Each Master Portfolio may purchase from financial
institutions participation interests in securities in which such Master
Portfolio may invest. A participation interest gives the Master Portfolio an
undivided interest in the security in the proportion that the Master
Portfolio's participation interest bears to the total principal amount of the
security. These instruments may have fixed, floating or variable-rates of
interest. If the participation interest is unrated, or has been given a rating
below that which is permissible for purchase by the Master Portfolio, the
participation interest is backed by an irrevocable letter of credit or
guarantee of a bank, or the payment obligation otherwise will be collateralized
by U.S. Government obligations, or, in the case of unrated participation
interests, BGFA must have determined that the instrument is of comparable
quality to those instruments in which such Master Portfolio may invest. Prior
to a Master Portfolio's purchase of any such instrument backed by a letter of
credit or guarantee of a bank, BGFA evaluates the creditworthiness of the bank,
considering all factors which it deems relevant, which generally may include
review of the bank's cash flow; level of short-term debt; leverage;
capitalization; the quality and depth of management; profitability; return on
assets; and economic factors relative to the banking industry. For certain
participation interests, the Master Portfolio has the right to demand payment,
on not more than seven days' notice, for all or any part of the Master
Portfolio's participation interest in the security, plus accrued interest. As
to these instruments, each Master Portfolio intends to exercise its right to
demand payment only upon a default under the terms of the security, as needed
to provide liquidity to meet redemptions, or to maintain or improve the quality
of its investment portfolio.

MORTGAGE-RELATED SECURITIES -- Each Master Portfolio may enter into repurchase
agreements with respect to mortgage- related securities ("MBSs"), representing
interests in a pool of loans secured by mortgages. The resulting cash flow
from these mortgages is used to pay principal and interest on the securities.
MBSs are assembled for sale to investors by various government-sponsored
enterprises such as the Federal National Mortgage Association ("FNMA") and the
Federal Home Loan Mortgage Corporation ("FHLMC") or are guaranteed by such
governmental agencies as the Government National Mortgage Association ("GNMA").
Regardless of the type of guarantee, all MBSs are subject to interest rate risk
(i.e., exposure to loss due to changes in interest rates).

GNMA MBSs include GNMA Mortgage Pass-Through Certificates (also
known as "Ginnie Maes") which are guaranteed as to the full and timely payment
of principal and interest by GNMA and such guarantee is backed by the authority
of GNMA to borrow funds from the U.S. Treasury to make payments under its
guarantee. GNMA is a wholly-owned U.S. Government corporation within the
Department of Housing and Urban Development. As such, GNMA securities are
backed by the full faith and credit of the federal government. MBSs issued by
FNMA include FNMA Guaranteed Mortgage Pass- Through Certificates ("Fannie
Maes") which are solely the obligations of FNMA and are neither backed by nor
entitled to the full faith and credit of the federal government. FNMA is a
government-sponsored enterprise which is also a private corporation whose stock
trades on the NYSE. Fannie Maes are guaranteed as to timely payment of
principal and interest by FNMA. FHLMC MBSs include FHLMC Mortgage
Participation Certificates ("Freddie Macs" or "PCs"). FHLMC guarantees timely
payment of

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interest, but only ultimate payment of principal due under the obligations it
issues. Freddie Macs are not guaranteed by the United States or by any Federal
Home Loan Bank and do not constitute a debt or obligation of the United States
or of any Federal Home Loan Bank. FHLMC may, under certain circumstances,
remit the payment of principal at any time after default, but in no event later
than one year after the guarantee becomes payable.

ILLIQUID SECURITIES -- Each Master Portfolio may invest up to 15% of the value
of its total net assets in securities as to which a liquid trading market does
not exist, provided such investments are consistent with its investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or contractual
restrictions on resale, participation interests that are not subject to the
demand feature described above, floating- and variable-rate demand obligations
as to which the Master Portfolio cannot exercise the related demand feature
described above on not more than seven days' notice and as to which there is no
secondary market and repurchase agreements providing for settlement more than
seven days after notice. However, if a substantial market of qualified
institutional investors develops pursuant to Rule 144A under the Securities Act
of 1933, as amended, for certain of these securities held by a Master
Portfolio, such Master Portfolio intends to treat such securities as liquid
securities in accordance with procedures approved by MIP's Board of Trustees.
Because it is not possible to predict with assurance how the market for
restricted securities pursuant to Rule 144A will develop, MIP's Board of
Trustees has directed BGFA to monitor carefully each Master Portfolio's
investments in such securities with particular regard to trading activity,
availability of reliable price information and other relevant information. To
the extent that qualified institutional investors may periodically cease
purchasing such restricted securities pursuant to Rule 144A, a Master
Portfolio's investing in such securities may have the effect of increasing the
level of liquidity in such Master Portfolio's portfolio during such period.

INVESTMENT COMPANY SECURITIES -- Each Master Portfolio may invest in securities
issued by other open-end management investment companies which principally
invest in securities of the type in which such Master Portfolio invests. Under
the 1940 Act, a Master Portfolio's investment in such securities currently is
limited to, subject to certain exceptions, (i) 3% of the total voting stock of
any one investment company, (ii) 5% of such Master Portfolio's net assets with
respect to any one investment company and (iii) 10% of such Master Portfolio's
net assets in the aggregate. Investments in the securities of other investment
companies generally will involve duplication of advisory fees and certain other
expenses and the investment adviser will waive its advisory fees for that
portion of the Master Portfolio's assets so invested, except when such purchase
is part of a plan of merger, consolidation, reorganization or acquisition.

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INVESTMENT TECHNIQUES.

FUTURES TRANSACTIONS -- IN GENERAL -- None of the Master Portfolios will be a
commodity pool. To the extent permitted by applicable regulations, each Master
Portfolio is permitted to use futures as a substitute for a comparable market
position in the underlying securities.

A futures transaction involves a firm agreement to buy or sell
a commodity or financial instrument at a particular price on a specified future
date. Futures contracts are traded on exchanges, where the exchange serves as
the ultimate counterparty for all contracts. Consequently, the only credit
risk on futures contracts is the creditworthiness of the exchange. Futures
contracts are, however, subject to market risk (i.e., exposure to adverse price
changes). The Master Portfolio may trade futures contracts and options on
futures contracts in U.S. domestic markets, such as the Chicago Board of Trade
and the International Monetary Market of the Chicago Mercantile Exchange.

Each of the Master Portfolio's futures transactions must
constitute permissible transactions pursuant to regulations promulgated by the
Commodity Futures Trading Commission ("CFTC"). In addition, a Master Portfolio
may not engage in futures transactions if the sum of the amount of initial
margin deposits and premiums paid for unexpired options on futures contracts,
other than for bona fide hedging transactions, would exceed 5% of the
liquidation value of the Master Portfolio's assets, after taking into account
unrealized profits and unrealized losses on such contracts it has entered into;
provided, however, that in the case of an option that is in-the-money at the
time of purchase, the in- the-money amount may be excluded in calculating the
5%. Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, a Master Portfolio may be required to segregate cash, U.S.
Government obligations or other high quality money market instruments in
connection with its futures transactions in an amount generally equal to the
entire value of the underlying commitment.

Initially, when purchasing or selling futures contracts a
Master Portfolio will be required to deposit with MIP's custodian in the
broker's name an amount of cash or cash equivalents up to approximately 10% of
the contract amount. This amount is subject to change by the exchange or board
of trade on which the contract is traded and members of such exchange or board
of trade may impose their own higher requirements. This amount is known as
"initial margin" and is in the nature of a performance bond or good faith
deposit on the contract which is returned to the Master Portfolio upon
termination of the futures position, assuming all contractual obligations have
been satisfied. Subsequent payments, known as "variation margin," to and from
the broker will be made daily as the price of the index or securities
underlying the futures contract fluctuates, making the long and short positions
in the futures contract more or less valuable, a process known as
"marking-to-market." At any time prior to the expiration of a futures
contract, the Master Portfolio may elect to close the position by taking an
opposite position, at the then prevailing price, which will operate to
terminate its existing position in the contract.

Although each of the Master Portfolios intends to purchase or
sell futures contracts only if there is an active market for such contracts, no
assurance can be given that a liquid market will exist for any particular
contract at any particular time. Many futures exchanges and boards of trade
limit the amount of fluctuation permitted in futures contract prices during a

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single trading day. Once the daily limit has been reached in a particular
contract, no trades may be made that day at a price beyond that limit or
trading may be suspended for specified periods during the trading day. Futures
contract prices could move to the limit for several consecutive trading days
with little or no trading, thereby preventing prompt liquidation of futures
positions and potentially subjecting the relevant Master Portfolio to
substantial losses. If it is not possible, or a Master Portfolio determines
not, to close a futures position in anticipation of adverse price movements,
such Master Portfolio will be required to make daily cash payments of variation
margin.

An option on a futures contract gives the purchaser the right,
in return for the premium paid, to assume a position in a futures contract (a
long position if the option is a call and a short position if the option is a
put) at a specified exercise price at any time during the option exercise
period. The writer (i.e., seller) of the option is required upon exercise to
assume an offsetting futures position (a short position if the option is a call
and a long position if the option is a put). Upon exercise of the option, the
assumption of offsetting futures positions by the writer and holder of the
option will be accompanied by delivery of the accumulated cash balance in the
writer's futures margin account which represents the amount by which the market
price of the futures contract, at exercise, exceeds, in the case of a call, or
is less than, in the case of a put, the exercise price of the option on the
futures contract.

STOCK INDEX FUTURES AND OPTIONS ON STOCK INDEX FUTURES -- (Asset Allocation
Master Portfolio) The Asset Allocation Master Portfolio may purchase and sell
stock index futures contracts and options on stock index futures contracts.

A stock index future obligates the seller to deliver (and the
purchaser to take), effectively, an amount of cash equal to a specific dollar
amount times the difference between the value of a specific stock index at the
close of the last trading day of the contract and the price at which the
agreement is made. No physical delivery of the underlying stocks in the index
is made. With respect to stock indexes that are permitted investments, the
Asset Allocation Master Portfolio intends to purchase and sell futures
contracts on the stock index for which it can obtain the best price with
consideration also given to liquidity.

Each Master Portfolio also may sell options on interest rate
futures contracts as part of closing purchase transactions to terminate its
options positions. No assurance can be given that such closing transactions
can be effected or the degree of correlation between price movements in the
options on interest rate futures and price movements in the Master Portfolio's
portfolio securities which are the subject of the transaction.

INTEREST RATE AND INDEX SWAPS -- Each Master Portfolio may enter into interest
rate swaps and the Asset Allocation Master Portfolio may enter into index swaps
in pursuit of its investment objective. Interest rate swaps involve the
exchange by a Master Portfolio with another party of their respective
commitments to pay or receive interest (for example, an exchange of
floating-rate

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payments for fixed-rate payments). Index swaps involve the exchange by the
Master Portfolio with another party of cash flows based upon the performance of
an index or a portion of an index which usually include dividends or income.
In each case, the exchange commitments can involve payments to be made in the
same currency or in different currencies.

Each Master Portfolio usually will enter into swaps on a net
basis. In so doing, the two payment streams are netted out, with the Master
Portfolio receiving or paying, as the case may be, only the net amount of the
two payments. If a Master Portfolio enters into a swap, it would maintain a
segregated account on a gross basis unless the contract provided otherwise. If
there is a default by the other party to such a transaction, the Master
Portfolio will have contractual remedies pursuant to the agreements related to
the transaction.

The use of interest rate and index swaps is a highly
specialized activity which involves investment techniques and risks different
from those associated with ordinary portfolio security transactions. There is
no limit, except as provided below, on the amount of swap transactions that may
be entered into by a Master Portfolio. These transactions generally do not
involve the delivery of securities or other underlying assets or principal.
Accordingly, the risk of loss with respect to swaps generally is limited to the
net amount of payments that a Master Portfolio is contractually obligated to
make. If the other party to a swap defaults, the relevant Master Portfolio's
risk of loss consists of the net amount of payments that such Master Portfolio
contractually is entitled to receive. No Master Portfolio will invest more
than 15% of the value of its net assets in swaps that are illiquid, and in
other illiquid securities.

LENDING PORTFOLIO SECURITIES -- From time to time, each Master Portfolio may
lend securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain transactions.
Such loans may not exceed one-third of the value of the relevant Master
Portfolio's total assets. In connection with such loans, each Master Portfolio
will receive collateral consisting of cash, U.S. Government securities or
irrevocable letters of credit which will be maintained at all times in an
amount equal to at least 100% of the current market value of the loaned
securities. Each Master Portfolio can increase its income through the
investment of such collateral. Each Master Portfolio continues to be entitled
to payments in amounts equal to the dividends, interest and other distributions
payable on the loaned security and receives interest on the amount of the loan.
Such loans will be terminable at any time upon specified notice. A Master
Portfolio might experience risk of loss if the institution with which it has
engaged in a portfolio loan transaction breaches its agreement with such Master
Portfolio.

FORWARD COMMITMENTS -- Each Master Portfolio may purchase securities on a
when-issued or forward commitment basis, which means that the price is fixed at
the time of commitment, but delivery and payment ordinarily take place a number
of days after the date of the commitment to purchase. A Master Portfolio will
make commitments to purchase such securities only with the intention of
actually acquiring the securities, but the Master Portfolio may sell these
securities before the settlement date if it is deemed advisable. The Master
Portfolio will not accrue income in respect of a security purchased on a
forward commitment basis prior to its stated delivery date.

Securities purchased on a when-issued or forward commitment
basis and certain other securities held in the Master Portfolio's investment
portfolio are subject to changes in value

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(both generally changing in the same way, i.e., appreciating when interest
rates decline and depreciating when interest rates rise) based upon the
public's perception of the creditworthiness of the issuer and changes, real or
anticipated, in the level of interest rates. Securities purchased on a
when-issued or forward commitment basis may expose the relevant Master
Portfolio to risk because they may experience such fluctuations prior to their
actual delivery. Purchasing securities on a when-issued or forward commitment
basis can involve the additional risk that the yield available in the market
when the delivery takes place actually may be higher than that obtained in the
transaction itself. A segregated account of each Master Portfolio consisting
of cash or U.S. Government securities or other high quality liquid debt
securities at least equal at all times to the amount of the when-issued or
forward commitments will be established and maintained at MIP's custodian bank.
Purchasing securities on a forward commitment basis when a Master Portfolio is
fully or almost fully invested may result in greater potential fluctuation in
the value of such Master Portfolio's total net assets and its net asset value
per share.

BORROWING MONEY -- As a fundamental policy, the Asset Allocation Master
Portfolio and the U.S. Treasury Allocation Master Portfolio may borrow up to
20% of the current value of its total net assets for temporary purposes only in
order to meet redemptions, and these borrowings may be secured by the pledge of
up to 20% of the current value of its net assets (but investments may not be
purchased while any such outstanding borrowing in excess of 5% of its total net
assets exists).

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MASTER INVESTMENT PORTFOLIO
INDEX MASTER PORTFOLIOS

S&P 500 INDEX MASTER PORTFOLIO
BOND INDEX MASTER PORTFOLIO

PART A

June 28, 1996

Responses to Items 1 through 3 have been omitted pursuant to paragraph 4 of
Instruction F of the General Instructions to Form N-1A.

Item 4. General Description of Registrant.

GENERAL. Master Investment Portfolio ("MIP") is an open-end, management
investment company, organized on October 21, 1993 as a business trust under the
laws of the State of Delaware. MIP is a "series fund," which is a mutual fund
divided into separate portfolios. By this offering document, MIP is offering
two diversified portfolios (each, a "Master Portfolio"). Each Master Portfolio
is treated as a separate entity for certain matters under the Investment
Company Act of 1940, as amended (the "1940 Act"), and for other purposes and an
interestholder of one Master Portfolio is not deemed to be an interestholder of
the other Master Portfolio. As described below, for certain matters MIP
interestholders vote together as a group; as to others they vote separately by
Master Portfolio. MIP currently offers nine other portfolios pursuant to other
offering documents. From time to time, other portfolios may be established and
sold pursuant to other offering documents.

Beneficial interests in each Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering"
within the meaning of Regulation D under the Securities Act of 1933, as amended
(the "1933 Act"). Investments in a Master Portfolio may be made only by
investment companies or certain other entities which are "accredited investors"
within the meaning of Regulation D under the 1933 Act. This registration
statement does not constitute an offer to sell, or the solicitation of an offer
to buy, any "security" within the meaning of the 1933 Act.

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INVESTMENT OBJECTIVES.

o The S&P 500 INDEX MASTER PORTFOLIO seeks to provide investment
results that correspond to the total return performance of publicly traded
common stocks in the aggregate, as represented by the Standard & Poor's 500
Stock Index.

o The BOND INDEX MASTER PORTFOLIO seeks to provide investment
results that correspond to the total return performance of fixed-income
securities in the aggregate, as represented by the Lehman Brothers
Government/Corporate Bond Index.

The investment objective of each Master Portfolio cannot be changed
without approval by the holders of a majority (as defined in the 1940 Act) of
such Master Portfolio's outstanding voting securities. The differences in
objectives and policies among each Master determines the types of portfolio
securities in which each Master Portfolio invests and can be expected to affect
the degree of risk to which each Master Portfolio is subject and the yield or
return of each Master Portfolio. There can be no assurance that the investment
objective of each Master Portfolio will be achieved.

MANAGEMENT POLICIES.

o Each of the S&P 500 Index Master Portfolio and Bond Index
Master Portfolio seeks to replicate the investment results of its
respective Index, as set forth below.

o The S&P 500 INDEX MASTER PORTFOLIO seeks to replicate the
total return performance of the S&P 500 Index, which is composed of
500 selected common stocks, most of which are listed on the New York
Stock Exchange. The weightings of stocks in the S&P 500 Index are
based on each stock's relative total market capitalization; that is,
its market price per share times the number of shares outstanding.
The percentage of the S&P 500 Index Master Portfolio's assets invested
in a given stock is approximately the same as the percentage such
stock represents in the S&P 500 Index.

o The BOND INDEX MASTER PORTFOLIO seeks to replicate the total
return performance of the Lehman Brothers Government/Corporate Bond
Index, which is composed of approximately 5,000 fixed-income
securities, including U.S. Government securities and investment grade
corporate bonds, each with an outstanding market value of at least $25
million and remaining maturity of greater than one year. The Bond
Index Master Portfolio invests in a sample of these securities. It
invests at least 65% of its total assets in bonds and debentures.
Securities are selected for investment by the Bond Index Master
Portfolio in accordance with their relative proportion of the Lehman
Brothers Government/Corporate Bond Index as well as based on credit
quality, issuer sector, maturity structure, coupon rates and
callability, among other factors, as described below.

* S&P does not sponsor the Master Portfolio, nor is it affiliated in any
way with BGFA or the Master Portfolio. "Standard & Poor's(R)," "S&P(R)," "S&P
500(R)," and "Standard & Poor's 500(R)" are trademarks of McGraw-Hill, Inc.
The Master Portfolio is not sponsored, endorsed, sold, or promoted by S&P and
S&P makes no representation or warranty, express or implied, regarding the
advisability of investing in the Master Portfolio.

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No attempt is made to manage the portfolio of each Master Portfolio
using economic, financial and market analysis. Each Master Portfolio is
managed by determining which securities are to be purchased or sold to
replicate, to the extent feasible, the investment characteristics of its
respective benchmark Index. Under normal market conditions, at least 90% of
the value of each Master Portfolio's total assets is invested in securities
comprising such Master Portfolio's Index. Each Master Portfolio attempts to
achieve, in both rising and falling markets, a correlation of at least 95%
between the total return of its net assets before expenses and the total return
of such Master Portfolio's benchmark Index. Perfect (100%) correlation would
be achieved if the total return of a Master Portfolio's net assets increased or
decreased exactly as the total return of such Master Portfolio's benchmark
Index increased or decreased. A Master Portfolio's ability to match its
investment performance to the investment performance of its respective
benchmark Index may be affected by, among other things, the Master Portfolio's
expenses, the amount of cash and cash equivalents held by the Master Portfolio,
the manner in which the total return of the Master Portfolio's benchmark Index
is calculated; the size of the Master Portfolio's investment portfolio; and the
timing, frequency and size of shareholder purchases and redemptions. Each
Master Portfolio uses cash flows from shareholder purchase and redemption
activity to maintain, to the extent feasible, the similarity of its portfolio
to the securities comprising such Master Portfolio's benchmark Index. BGFA
regularly monitors each Master Portfolio's correlation to its respective
benchmark Index and adjusts the portfolio of each Master Portfolio to the
extent necessary to enable such Master Portfolio to achieve a correlation of at
least 95% with its respective Index. Inclusion of a security in an Index in no
way implies an opinion by the sponsor of the Index as to its attractiveness as
an investment. In the future, subject to the approval of the relevant Master
Portfolio's interestholders, one or more indices for a Master Portfolio may be
selected if such standard of comparison is deemed to be more representative of
the performance of the securities such Master Portfolio seeks to replicate.
The Master Portfolios are not sponsored, endorsed, sold or promoted by the
sponsor of their respective Indices.

The Bond Index Master Portfolio will not hold all of the issues that
comprise the Lehman Brothers Government/Corporate Bond Index because of the
costs involved and the illiquidity of certain of the securities which comprise
such Index. Instead, the Bond Index Master Portfolio attempts to hold a
representative sample of the securities in its respective Index so that, in the
aggregate, the investment characteristics of its portfolio resemble those of
its respective Index. The Bond Index Master Portfolio uses a statistical
process known as "sampling" to construct a mix of assets in its portfolio.
This process is used with respect to the Bond Index Master Portfolio initially
to select issues to represent entire "classes" or types of fixed-income
securities in the Index. At the broadest level, the Bond Index Master
Portfolio seeks to hold securities reflecting the two major classes of fixed-
income securities in the Lehman Brothers Government/Corporate Bond Index --
U.S. Government securities and investment grade corporate debt securities.
Such classes are delineated further according to credit quality, issuer sector,
term to maturity, coupon rates and callability.

The sampling techniques utilized by each Master Portfolio are expected
to be an effective means of substantially duplicating the investment
performance of their respective Indices. However, no Master Portfolio is
expected to track its benchmark Index with the same degree of accuracy that
complete replication of such Index would have provided. Over time, the
portfolio

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composition of each Master Portfolio may be altered (or "rebalanced") to
reflect changes in the characteristics of its respective Index.

In seeking to replicate the performance of its respective Index, each
Master Portfolio also may engage in futures and options transactions and other
derivative securities transactions and lend its portfolio securities, each of
which involves risk. See "Risk Factors" below, and "Appendix -- Investment
Techniques." Each Master Portfolio attempts to be fully invested at all times
in securities comprising such Master Portfolio's Index and in futures and
options. When a Master Portfolio has uninvested cash, it may invest in money
market instruments.

CERTAIN FUNDAMENTAL POLICIES. Each Master Portfolio may (i) borrow money to
the extent permitted under the 1940 Act, except that the Bond Index Master
Portfolio may borrow from banks up to 10% of the current value of its net
assets for temporary purposes only in order to meet redemptions, and except
that the S&P 500 Index Master Portfolio may borrow up to 20% of the current
value of its net assets for temporary purposes only in order to meet
redemptions. For purposes of this investment restriction, a Master Portfolio's
entry into options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices, shall not
constitute borrowing to the extent certain segregated accounts are established
and maintained by the Master Portfolio; (ii) invest up to 5% of its total
assets in the obligations of any single issuer, except that up to 25% of the
value of the total assets of such Master Portfolio may be invested and
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities may be purchased, without regard to any such limitation; and
(iii) invest up to 25% of the value of its total assets in the securities of
issuers in a particular industry or group of closely related industries,
subject to certain exceptions specified in Part B, including that there is no
limitation on the purchase of obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. This paragraph describes
fundamental policies that cannot be changed as to a Master Portfolio without
approval by the holders of a majority (as defined in the 1940 Act) of such
Master Portfolio's outstanding voting securities. See Item 13, "Investment
Objectives and Policies -- Investment Restrictions," in Part B.

CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICIES. Each Master Portfolio may (i)
purchase securities of companies having less than three years' continuous
operation (including operations of any predecessors), provided that the
securities are fully guaranteed or insured by the U.S. Government, a state,
commonwealth, possession, territory, the District of Columbia or by an entity
in existence at least three years, or the securities are backed by the assets
and revenues of any of the foregoing, if such purchase does not cause the value
of its investments in all such companies to exceed 5% of the value of its total
assets; (ii) pledge, hypothecate, mortgage or otherwise encumber its assets,
but only to secure permitted borrowings; and (iii) invest up to 15% of the
value of its net assets in repurchase agreements providing for settlement in
more than seven days after notice and in other illiquid securities. See Item
13, "Investment Objectives and Policies -- Investment Restrictions," in Part B.

RISK FACTORS.

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GENERAL -- The net asset value per share of each Master Portfolio is not fixed
and is expected to fluctuate.

EQUITY SECURITIES -- (S&P 500 Index Master Portfolio) Investors should be aware
that equity securities fluctuate in value, often based on factors unrelated to
the value of the issuer of the securities, and that fluctuations can be
pronounced. Changes in the value of a Master Portfolio's portfolio securities
will result in changes in the value of such Master Portfolio's shares and thus
the Master Portfolio's yield and total return to investors.

FIXED-INCOME SECURITIES -- (Bond Index Master Portfolio) Investors should be
aware that even though interest-bearing securities are investments which
promise a stable stream of income, the prices of such securities are inversely
affected by changes in interest rates and, therefore, are subject to the risk
of market price fluctuations. Thus, if interest rates have increased from the
time a security was purchased, such security, if sold, might be sold at a price
less than cost. Similarly, if interest rates have declined from the time a
security was purchased, such security, if sold, might be sold at a price
greater than its cost. Long-term securities are affected to a greater extent
by interest rates than shorter-term securities. The values of fixed-income
securities also may be affected by changes in the credit rating or financial
condition of the issuing entities. Certain securities that may be purchased by
the Bond Index Master Portfolio, such as those rated "Baa" by Moody's and "BBB"
by S&P, Fitch and Duff, may be subject to such risk with respect to the issuing
entity and to greater market fluctuations than certain lower yielding, higher
rated fixed-income securities. Securities which are rated "Baa" by Moody's are
considered medium grade obligations; they are neither highly protected nor
poorly secured, and are considered by Moody's to have speculative
characteristics. Securities rated "BBB" by S&P are regarded as having adequate
capacity to pay interest and repay principal, and while such debt securities
ordinarily exhibit 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 securities in this category than in higher
rated categories. Securities rated "BBB" by Fitch are considered investment
grade and of satisfactory credit quality; however, adverse changes in economic
conditions and circumstances are more likely to have an adverse impact on these
securities and, therefore, impair timely payment. Securities rated "BBB" by
Duff have below average protection factors but nonetheless are considered
sufficient for prudent investment. If a security included in the Lehman
Brothers Government/Corporate Bond Index is downgraded to a rating below
investment grade, such security will be deleted from the Index at the end of
the calendar month in which the downgrading occurred and, accordingly, will be
sold by the Bond Index Master Portfolio at that time or shortly thereafter.
See "Appendix" in Part B.

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non-U.S. issuer, and non-U.S. issuers generally are not subject to uniform
accounting and financial reporting standards, practices and requirements
comparable to those applicable to U.S. issuers.

Because evidences of ownership of such securities usually are
held outside the United States, each Master Portfolio may be subject to
additional risks which include possible adverse political and economic
developments, possible seizure or nationalization of foreign deposits and
possible adoption of governmental restrictions which might adversely affect the
payment of principal and interest on the foreign securities or might restrict
the payment of principal and interest to investors located outside the country
of the issuers, whether from currency blockage or otherwise. Custodial
expenses for a portfolio of non-U.S. securities generally are higher than for a
portfolio of U.S. securities.

Since foreign securities often are purchased by a Master
Portfolio with, and payable in, currencies of foreign countries, the value of
these assets as measured in U.S. dollars may be affected favorably or
unfavorably by changes in currency rates and exchange control regulations.
Some currency exchange costs generally will be incurred when a Master Portfolio
changes investments from one country to another.

Furthermore, some of these securities may be subject to
brokerage or stamp taxes levied by foreign governments, which have the effect
of increasing the cost of such investment and reducing the realized gain or
increasing the realized loss on such securities at the time of sale. Income
received by a Master Portfolio from sources within foreign countries may be
reduced by withholding and other taxes imposed by such countries. Tax
conventions between certain countries and the United States, however, may
reduce or eliminate such taxes. All such taxes paid by a Master Portfolio will
reduce its net income available for distribution to its interestholders.

OTHER INVESTMENT CONSIDERATIONS -- Indexing strategies are employed by BGFA for
other investment companies and accounts advised or sub-advised by BGFA. If
these strategies indicate particular securities should be purchased or sold, at
the same time, by a Master Portfolio and one or more of these investment
companies or accounts, available investments or opportunities for sales will be
allocated equitably to each by the investment adviser. In some cases, this
procedure may adversely affect the size of the position obtained for or
disposed of by a Master Portfolio or the price paid or received by such Master
Portfolio.

Item 5. Management of the Master Portfolios.

INVESTMENT ADVISER -- Pursuant to separate investment advisory contracts (the
"BGFA Advisory Contracts") dated January 1, 1996, BGFA serves as investment
adviser to each Master Portfolio. BGFA is an indirect subsidiary of Barclays
Bank PLC ("Barclays") and is located at 45 Fremont Street, San Francisco, CA
94105. As of March 1, 1996, BGFA and its affiliates provided investment
advisory services for over $284 billion of assets under management.

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in conformity with Delaware law and the stated policies of each Master
Portfolio. Pursuant to the BGFA Advisory Contracts, BGFA furnishes to MIP's
Board of Trustees periodic reports on the investment strategy and performance
of each Master Portfolio. BGFA continues to employ substantially the same
WFNIA investment professionals that previously managed the investment portfolio
of each Master Portfolio.

BGFA is entitled to receive monthly fees at the annual rate of
0.08% and 0.05% of the average daily net assets of the Bond Index Master
Portfolio and S & P 500 Index Master Portfolio, respectively, as compensation
for its advisory services. From time to time, BGFA may waive such fees in
whole or in part. Any such waiver will reduce the expenses of a Master
Portfolio and, accordingly, have a favorable impact on the performance of such
Master Portfolio. For the period from January 1, 1996 to February 29, 1996,
BGFA received amounts equal to 0.05% and 0.08% of the average daily net assets
of the S&P 500 Index and Bond Index Master Portfolios, respectively, as
compensation for its advisory services.

Prior to January 1, 1996, Wells Fargo Bank, N.A., a wholly
owned subsidiary of Wells Fargo & Company located at 420 Montgomery Street, San
Francisco, California 94105, served as each Master Portfolio's investment
adviser. Pursuant to an Investment Advisory Agreement with MIP, Wells Fargo
Bank provided investment guidance and policy direction in connection with the
management of each Master Portfolio's assets, subject to the supervision of
MIP's Board of Trustees and in conformity with Delaware law and the stated
policies of such Master Portfolio. The BGFA Advisory contracts are identical
in all material respects, other than the identity of the parties, to the
Investment Advisory Agreement with Wells Fargo Bank. Under the terms of the
prior Investment Advisory Agreement, MIP was contractually obligated to pay
Wells Fargo Bank a monthly fee on behalf of each Master Portfolio at the annual
rate of 0.08% and 0.05% of the average daily net assets of the Bond Index and
S&P 500 Index Master Portfolios, respectively. For the period beginning March
1, 1995 and ended December 31, 1995, Wells Fargo Bank was paid monthly fees at
the annual rate of 0.05% and 0.08% of the average daily net assets of the S&P
500 Index Master Portfolio and Bond Index Master Portfolio, respectively, for
its services as investment adviser to such Master Portfolio. The Investment
Advisory Agreement with Wells Fargo Bank terminated as of January 1, 1996.

Prior to January 1, 1996, Wells Fargo Bank engaged WFNIA,
located at 45 Fremont Street, San Francisco, California 94105, to provide
sub-investment advisory services to each Master Portfolio. WFNIA was a general
partnership, which was dissolved on December 31, 1995, owned 50% by a wholly
owned subsidiary of Wells Fargo Bank and 50% by a subsidiary of The Nikko
Securities Co., Ltd. Prior to January 1, 1996 and pursuant to a Sub-Investment
Advisory Agreement, WFNIA provided investment advisory assistance and the
day-to-day management of each Master Portfolio's assets, subject to the
supervision and approval of Wells Fargo Bank and the overall authority of MIP's
Board of Trustees and in conformity with Delaware law and the stated policies
of such Master Portfolio. Wells Fargo Bank was contractually obligated to pay
WFNIA a monthly fee at the annual rate of 0.07% and 0.04% of

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the average daily net assets of the Bond Index and S&P 500 Index Master
Portfolios, respectively. During the same period WFNIA actually was paid by
Wells Fargo Bank sub-advisory fees at the annual rate of 0.04% and 0.07% of the
average daily net assets of the Bond Index and S&P 500 Index Master Portfolios,
respectively.

As investment adviser, Wells Fargo Bank was permitted to deal,
trade and invest for its own account in the types of securities in which the
Bond Index and S&P 500 Index Master Portfolio invested and may have had
deposit, loan and commercial banking relationships with the issuers of
securities purchased by a Master Portfolio. Wells Fargo Bank informed MIP that
in making its investment decisions it does not obtain or use material inside
information in its possession.

Morrison & Foerster LLP, counsel to MIP and special counsel to
BGFA, has advised MIP, and BGFA that BGFA and its affiliates may perform the
services contemplated by the BGFA Advisory Contracts and this Prospectus
without violation of the Glass-Steagall Act. Such counsel has pointed out,
however, that there are no controlling judicial or administrative
interpretations or decisions and that future judicial or administrative
interpretations of, or decisions relating to, present federal or state
statutes, including the Glass-Steagall Act, and regulations relating to the
permissible activities of banks and their subsidiaries or affiliates, as well
as future changes in such statutes, regulations and judicial or administrative
decisions or interpretations, could prevent such entities from continuing to
perform, in whole or in part, such services. If any such entity were
prohibited from performing any such services, it is expected that new
agreements would be proposed or entered into with another entity or entities
qualified to perform such services.

ADMINISTRATOR AND PLACEMENT AGENT -- Stephens Inc. ("Stephens"), located at 111
Center Street, Little Rock, Arkansas 72201, serves as each Master Portfolio's
administrator pursuant to an Administration Agreement with MIP. Under the
Administration Agreement, Stephens provides general supervision of the
operation of MIP and each Master Portfolio, other than the provision of
investment advice, subject to the overall authority of MIP's Board of Trustees.
The administrative services provided to the Master Portfolio also include
coordination of the other services provided to the Master Portfolios,
compilation of information for reports to the Securities and Exchange
Commission and state securities commissions, preparation of proxy statements
and interestholder reports, and general supervision of data compilation in
connection with preparing periodic reports to MIP's Board of Trustees and
officers. Stephens also furnishes office space and certain facilities to
conduct business, and compensates MIP's Trustees, officers and employees who
are affiliated with Stephens. Stephens is not entitled to compensation for
providing administrative services to a Master Portfolio so long as Stephens
receives fees for providing similar services to a fund of another registered
investment company that invests all of its assets in such Master Portfolio.
Stephens also serves as placement agent for each Master Portfolio's shares.

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investment portfolios for pension and profit sharing plans, individual
investors, foundations, insurance companies and university endowments.

CUSTODIAN AND TRANSFER AGENT. BGI serves as custodian to each Master Portfolio
and is located at 45 Fremont Street, San Francisco, California 94105. BGI is a
wholly-owned subsidiary of BZW Barclays Global Investors Holding Inc.
(formerly, The Nikko Building U.S.A., Inc.) and is also an indirect subsidiary
of Barclays. Prior to January 1, 1996, BGI was known as Wells Fargo
Institutional Trust Company, N.A. ("WFITC") and WFNIA and Wells Fargo & Company
together held 100% of WFITC's outstanding voting securities. Wells Fargo Bank
is each Master Portfolio's Transfer and Dividend Disbursing Agent (the
"Transfer Agent"). The principal business address of Wells Fargo Bank is 525
Market Street, San Francisco, California 94105.

Item 6. Capital Stock and Other Securities.

MIP is organized as a trust under the laws of the State of
Delaware. Investors in MIP are each liable for all obligations of MIP.
However, the risk of an investor incurring financial loss on account of such
liability is limited to circumstances in which both inadequate insurance
existed and itself was unable to meet its obligations.

To date, the Board of Trustees has authorized the creation of
fourteen separate series. All consideration received by MIP for shares of one
of the series and all assets in which such consideration is invested will
belong to that series (subject only to the rights of creditors of MIP) and will
be subject to the liabilities related thereto. The income attributable to, and
the expenses of, one series are treated separately from those of the other
series. MIP may create, from time to time, new series without shareholder
approval.

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PRICE AND INVESTMENT RETURN OF EACH MASTER PORTFOLIO IS EXPECTED TO FLUCTUATE
AND INVESTMENTS IN THE MASTER PORTFOLIOS ARE NOT GUARANTEED.

Unless otherwise required by the 1940 Act, ordinarily it will
not be necessary for MIP to hold annual meetings of interestholders. As a
result, interestholders may not consider each year the election of Trustees or
the appointment of auditors. However, the holders of at least 10% of the
securities outstanding and entitled to vote may require MIP to hold a special
meeting of shareholders for purposes of removing a Trustee from office. MIP
interestholders may remove a Trustee by the affirmative vote of a majority of
MIP's outstanding voting securities. In addition, the Board of Trustees will
call a meeting of interestholders for the purpose of electing Trustees if, at
any time, less than a majority of the Trustees then holding office have been
elected by interestholders. Investments in a Master Portfolio may not be
transferred, but an investor may withdraw all or any portion of its investment
at any time at net asset value.

Under MIP's anticipated classification for federal income tax
purposes, each Master Portfolio will be treated as a non-publicly traded
partnership, and, therefore, will not be subject to any federal income tax.
However, each investor in a Master Portfolio will be taxable on its allocable
share (as determined in accordance with the governing instruments of MIP) of
such Master Portfolio's ordinary income and capital gain in determining its
income tax liability. The determination of such share will be made in
accordance with the Internal Revenue Code of 1986, as amended (the "Code"), and
regulations promulgated thereunder.

It is expected that each Master Portfolio will be managed so
that each investment company that invests all of its assets in a Master
Portfolio will qualify as a "regulated investment company" under the Code.

As of June 1, 1996, the S&P 500 Stock Fund of MasterWorks Funds
Inc. ("MasterWorks"), 111 Center Street, Little Rock, Arkansas 72201, owned
approximately 95% of the outstanding voting securities of the S&P 500 Index
Master Portfolio. As of June 1, 1996, the Bond Index Fund of MasterWorks and
the Bradley Trust, 1000 N. Water Street, 11th Floor, Milwaukee, WI 53202, owned
approximately 41%, and 55%, respectively, of the outstanding voting securities
of the Bond Index Master Portfolio. As such, each Fund and Bradley could each
be considered a controlling person of the corresponding Master Portfolio for
purposes of the 1940 Act.

Item 7. Purchase of Securities.

Beneficial interests in a Master Portfolio are issued solely in
private placement transactions which do not involve any "public offering"
within the meaning of Section 4(2) of the 1933 Act. Investments in a Master
Portfolio may be made only by investment companies or certain other entities
which are "accredited investors" within the meaning of Regulation D under the
Securities Act of 1933, as amended. This registration statement does not
constitute an offer to sell, or the solicitation of an offer to buy, any
"security" within the meaning of the Securities Act of 1933, as amended.

Shares of each Master Portfolio are sold on a continuous basis
at the net asset value per share next determined after an order in proper form
is received by the Transfer Agent.

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Net asset value per share for each Master Portfolio is determined as of the
close of trading of the New York Stock Exchange (currently 4:00 p.m., Eastern
Standard Time), on each day the New York Stock Exchange is open for business (a
"Business Day"). Net asset value per share is computed by dividing the value
of the Master Portfolio's net assets (i.e., the value of its assets less
liabilities) by the total number of shares of such Master Portfolio
outstanding. The Master Portfolio's investments are valued each Business Day
generally by using available market quotations or at fair value determined in
good faith by MIP's Board of Trustees. For further information regarding the
methods employed in valuing each Master Portfolio's investments, see Item 19,
"Purchase, Redemption and Pricing of Securities" in Part B.

Item 8. Redemption or Repurchase.

An investor in MIP may withdraw all or any portion of its
investment on any Business Day at the net asset value next determined after a
withdrawal request in proper form is furnished by the investor to the Transfer
Agent. When a request is received in proper form, MIP will redeem the shares
at the next determined net asset value.

The right of any investor to receive payment with respect to
any withdrawal may be suspended or the payment of the withdrawal proceeds
postponed during any period in which the New York Stock Exchange is closed
(other than weekends or holidays) or trading on such Exchange is restricted,
or, to the extent otherwise permitted by the 1940 Act, if an emergency exists.

Item 9. Pending Legal Proceedings.

Not applicable.

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APPENDIX

PORTFOLIO SECURITIES.

To the extent set forth in this offering document, each Master
Portfolio may invest in the securities described below.

U.S. GOVERNMENT OBLIGATIONS -- Each Master Portfolio may invest in various
types of U.S. Government obligations with remaining maturities of up to one
year. U.S. Government obligations include securities issued or guaranteed as
to principal and interest by the U.S. Government and supported by the full
faith and credit of the U.S. Treasury. U.S. Treasury obligations differ
mainly in the length of their maturity. Treasury bills, the most frequently
issued marketable government securities, have a maturity of up to one year and
are issued on a discount basis. U.S. Government obligations also include
securities issued or guaranteed by federal agencies or instrumentalities,
including government- sponsored enterprises. Some obligations of such agencies
or instrumentalities of the U.S. Government are supported by the full faith and
credit of the United States or U.S. Treasury guarantees; others, by the right
of the issuer or guarantor to borrow from the U.S. Treasury; still others by
the discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others, only by the credit of
the agency or instrumentality issuing the obligation. In the case of
obligations not backed by the full faith and credit of the United States, the
investor must look principally to the agency or instrumentality issuing or
guaranteeing the obligation for ultimate repayment, which agency or
instrumentality may be privately owned. There can be no assurance that the
U.S. Government would provide financial support to its agencies or
instrumentalities (including government- sponsored enterprises) where it is not
obligated to do so. In addition, U.S. Government obligations are subject to
fluctuations in market value due to fluctuations in market interest rates. As
a general matter, the value of debt instruments, including U.S. Government
obligations, declines when market interest rates increase and rises when market
interest rates decrease. Certain types of U.S. Government obligations are
subject to fluctuations in yield or value due to their structure or contract
terms.

FOREIGN GOVERNMENT OBLIGATIONS; SECURITIES OF SUPRANATIONAL ENTITIES -- Each
Master Portfolio, through its investment in money market instruments, may
invest in obligations issued or guaranteed by one or more foreign governments
or any of their political subdivisions, agencies or instrumentalities that are
determined by BGFA to be of comparable quality to the other obligations in
which such Master Portfolio may invest. Such securities also include debt
obligations of supranational entities. Supranational entities include
international organizations designated or supported by governmental entities to
promote economic reconstruction or development and international banking
institutions and related government agencies. Examples include the
International Bank for Reconstruction and Development (the World Bank), the
European Coal and Steel Community, the Asian Development Bank and the
InterAmerican Development Bank. The percentage of a Master Portfolio's assets
invested in securities issued by foreign governments will vary depending on the
relative yields of such securities, the economic and financial markets of the
countries in which the investments are made and the interest rate climate of
such countries.

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BANK OBLIGATIONS -- Each Master Portfolio may invest in bank obligations,
including certificates of deposit, time deposits, bankers' acceptances and
other short-term obligations of domestic banks, foreign subsidiaries of
domestic banks, foreign branches of domestic banks, and domestic and foreign
branches of foreign banks, domestic savings and loan associations and other
banking institutions. With respect to such securities issued by foreign
branches of domestic banks, foreign subsidiaries of domestic banks, and
domestic and foreign branches of foreign banks, a Master Portfolio may be
subject to additional investment risks that are different in some respects from
those incurred by a fund which invests only in debt obligations of U.S.
domestic issuers. Such risks include possible future political and economic
developments, the possible imposition of foreign withholding taxes on interest
income payable on the securities, the possible establishment of exchange
controls or the adoption of other foreign governmental restrictions which might
adversely affect the payment of principal and interest on these securities and
the possible seizure or nationalization of foreign deposits.

Certificates of deposit are negotiable certificates evidencing
the obligation of a bank to repay funds deposited with it for a specified
period of time.

Time deposits are non-negotiable deposits maintained in a
banking institution for a specified period of time at a stated interest rate.
Time deposits which may be held by a Master Portfolio will not benefit from
insurance from the Bank Insurance Fund or the Savings Association Insurance
Fund administered by the Federal Deposit Insurance Corporation.

COMMERCIAL PAPER AND OTHER SHORT-TERM CORPORATE OBLIGATIONS -- Each Master
Portfolio may invest in commercial paper, which consists of short-term,
unsecured promissory notes issued to finance short-term credit needs. The
commercial paper purchased by each Master Portfolio will consist only of direct
obligations which, at the time of their purchase, are (a) rated not lower than
Prime-1 by Moody's, A-1 by S&P, F-1 by Fitch or Duff-1 by Duff, (b) issued by
companies having an outstanding unsecured debt issue currently rated not lower
than Aa3 by Moody's or AA- by S&P, Fitch or Duff, or (c) if unrated, determined
by BGFA to be of comparable quality to those rated obligations which may be
purchased by such Fund.

REPURCHASE AGREEMENTS -- Each Master Portfolio may enter into repurchase
agreements wherein the seller of a security to a Master Portfolio agrees to
repurchase that security from such Master Portfolio at a mutually agreed-upon
time and price. MIP's custodian has custody of, and holds in a segregated
account, securities acquired as collateral by a Master Portfolio under a
repurchase agreement. Repurchase agreements are considered by the staff of the
Securities and Exchange Commission to be loans by the Master Portfolio. In an
attempt to reduce the risk of incurring a loss on a repurchase agreement, each
Master Portfolio enters into repurchase agreements only with federally
regulated or insured banks or primary government securities dealers reporting
to the Federal Reserve Bank of New York or, under certain circumstances,

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banks with total assets in excess of $5 billion or domestic broker/dealers with
total equity capital in excess of $100 million. The Master Portfolio enters
into repurchase agreements only with respect to securities of the type in which
such Master Portfolio may invest, including government securities and
mortgage-related securities, regardless of their remaining maturities, and
requires that additional securities be deposited with the custodian if the
value of the securities purchased should decrease below resale price. BGFA
monitors on an ongoing basis the value of the collateral to assure that it
always equals or exceeds the repurchase price. Certain costs may be incurred
by a Master Portfolio in connection with the sale of the underlying securities
if the seller does not repurchase them in accordance with the repurchase
agreement. In addition, if bankruptcy proceedings are commenced with respect
to the seller of the securities, disposition of the securities by a Master
Portfolio may be delayed or limited. Each Master Portfolio considers on an
ongoing basis the creditworthiness of the institutions with which it enters
into repurchase agreements.

FLOATING- AND VARIABLE-RATE OBLIGATIONS -- Each Master Portfolio may purchase
floating and variable-rate demand notes and bonds, which are obligations
ordinarily having stated maturities in excess of thirteen months, but which
permit the holder to demand payment of principal at any time, or at specified
intervals not exceeding thirteen months. Variable- rate demand notes include
master demand notes which are obligations that permit a Master Portfolio to
invest fluctuating amounts, which may change daily without penalty, pursuant to
direct arrangements between the Master Portfolio, as lender, and the borrower.
The interest rates on these notes fluctuate from time to time. The issuer of
such obligations ordinarily has a corresponding right, after a given period, to
prepay in its discretion the outstanding principal amount of the obligations
plus accrued interest upon a specified number of days' notice to the holders of
such obligations. The interest rate on a floating-rate demand obligation is
based on a known lending rate, such as a bank's prime rate, and is adjusted
automatically each time such rate is adjusted. The interest rate on a
variable-rate demand obligation is adjusted automatically at specified
intervals. Frequently, such obligations are secured by letters of credit or
other credit support arrangements provided by banks. Because these obligations
are direct lending arrangements between the lender and borrower, it is not
contemplated that such instruments generally will be traded, and there
generally is no established secondary market for these obligations, although
they are redeemable at face value. Accordingly, where these obligations are
not secured by letters of credit or other credit support arrangements, the
Master Portfolio's right to redeem is dependent on the ability of the borrower
to pay principal and interest on demand. Such obligations frequently are not
rated by credit rating agencies and each Master Portfolio may invest in
obligations which are not so rated only if BGFA determines that at the time of
investment the obligations are of comparable quality to the other obligations
in which such Master Portfolio may invest. BGFA, on behalf of each Master
Portfolio, considers on an ongoing basis the creditworthiness of the issuers of
the floating- and variable-rate demand obligations in such Master Portfolio's
investment portfolio. No Master Portfolio will invest more than 15% of the
value of its total net assets in floating-or

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variable-rate demand obligations whose demand feature is not exercisable within
seven days. Such obligations may be treated as liquid provided that an active
secondary market exists.

PARTICIPATION INTERESTS -- Each Master Portfolio may purchase from financial
institutions participation interests in securities in which such Master
Portfolio may invest. A participation interest gives the Master Portfolio an
undivided interest in the security in the proportion that the Master
Portfolio's participation interest bears to the total principal amount of the
security. These instruments may have fixed, floating or variable-rates of
interest. If the participation interest is unrated, or has been given a rating
below that which is permissible for purchase by the Master Portfolio, the
participation interest is backed by an irrevocable letter of credit or
guarantee of a bank, or the payment obligation otherwise will be collateralized
by U.S. Government securities, or, in the case of unrated participation
interests, BGFA must have determined that the instrument is of comparable
quality to those instruments in which such Master Portfolio may invest. Prior
to a Master Portfolio's purchase of any such instrument backed by a letter of
credit or guarantee of a bank, BGFA evaluates the creditworthiness of the bank,
considering all factors which it deems relevant, which generally may include
review of the bank's cash flow; level of short-term debt; leverage;
capitalization; the quality and depth of management; profitability; return on
assets; and economic factors relative to the banking industry. For certain
participation interests, the Master Portfolio has the right to demand payment,
on not more than seven days' notice, for all or any part of the Master
Portfolio's participation interest in the security, plus accrued interest. As
to these instruments, each Master Portfolio intends to exercise its right to
demand payment only upon a default under the terms of the security, as needed
to provide liquidity to meet redemptions, or to maintain or improve the quality
of its investment portfolio.

MORTGAGE-RELATED SECURITIES--Each Master Portfolio may enter into repurchase
agreements with respect to mortgage-related securities ("MBSs"), representing
interests in a pool of loans secured by mortgages. The resulting cash flow
from these mortgages is used to pay principal and interest on the securities.
MBSs are assembled for sale to investors by various government-sponsored
enterprises such as the Federal National Mortgage Association ("FNMA") and the
Federal Home Loan Mortgage Corporation ("FHLMC") or are guaranteed by such
governmental agencies as the Government National Mortgage Association ("GNMA").
Regardless of the type of guarantee, all MBSs are subject to interest rate risk
(i.e., exposure to loss due to changes in interest rates).

GNMA MBSs include GNMA Mortgage Pass-Through Certificates
("Ginnie Maes") which are guaranteed as to the full and timely payment of
principal and interest by GNMA and such guarantee is backed by the authority of
GNMA to borrow funds from the U.S. Treasury to make payments under its
guarantee. GNMA is a wholly-owned U.S. Government corporation within the
Department of Housing and Urban Development. As such, GNMA obligations are
general obligations of the United States and are backed by the full faith and
credit of the federal government. MBSs issued by FNMA include FNMA Guaranteed
Mortgage Pass-Through Certificates ("Fannie Maes") which are solely the
obligations of FNMA and are neither backed by nor entitled to the full faith
and credit of the federal government. FNMA is a government-sponsored
enterprise which is also a private corporation whose stock trades on the NYSE.
Fannie Maes are guaranteed as to timely payment of principal and interest by
FNMA. FHLMC MBSs include FHLMC Mortgage Participation Certificates ("Freddie
Macs" or "PCs"). FHLMC guarantees timely payment of interest, but only
ultimate payment of principal due under the

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obligations it issues. Freddie Macs are not guaranteed by the United States or
by any Federal Home Loan Bank and do not constitute a debt or obligation of the
United States or of any Federal Home Loan Bank. FHLMC may, under certain
circumstances, remit the payment of principal at any time after default, but in
no event later than one year after the guarantee becomes payable.

WARRANTS -- Each Master Portfolio may invest up to 5% of its net assets in
warrants, except that this limitation does not apply to warrants acquired in
units or attached to securities. A warrant is an instrument issued by a
corporation which gives the holder the right to subscribe to a specified amount
of the corporation's capital stock at a set price for a specified period of
time, usually with a stated maturity in excess of one year.

ILLIQUID SECURITIES -- Each Master Portfolio may invest up to 15% of the value
of its net assets in securities as to which a liquid trading market does not
exist, provided such investments are consistent with its investment objective.
Such securities may include securities that are not readily marketable, such as
certain securities that are subject to legal or contractual restrictions on
resale, participation interests that are not subject to the demand feature
described above, floating and variable-rate demand obligations as to which the
Master Portfolio cannot exercise the related demand feature described above on
not more than seven days' notice and as to which there is no secondary market
and repurchase agreements providing for settlement more than seven days after
notice. However, if a substantial market of qualified institutional investors
develops pursuant to Rule 144A under the Securities Act of 1933, as amended,
for certain of these securities held by a Master Portfolio, such Master
Portfolio intends to treat such securities as liquid securities in accordance
with procedures approved by MIP's Board of Trustees. Because it is not
possible to predict with assurance how the market for restricted securities
pursuant to Rule 144A will develop, MIP's Board of Trustees has directed BGFA
to monitor carefully each Master Portfolio's investments in such securities
with particular regard to trading activity, availability of reliable price
information and other relevant information. To the extent that for a period of
time, qualified institutional investors cease purchasing such restricted
securities pursuant to Rule 144A, a Master Portfolio's investing in such
securities may have the effect of increasing the level of illiquidity in such
Master Portfolio's investment portfolio during such period.

INVESTMENT COMPANY SECURITIES -- Each Master Portfolio may invest in securities
issued by other open-end investment management companies which principally
invest in securities of the type in which such Master Portfolio invests. Under
the 1940 Act, a Master Portfolio's investment in such securities currently is
limited to, subject to certain exceptions, (i) 3% of the total voting stock of
any one investment company, (ii) 5% of such Master Portfolio's net assets with
respect to any one investment company and (iii) 10% of such Master Portfolio's
net assets in the aggregate. Investments in the securities of other investment
companies generally will involve duplication of advisory fees and certain other
expenses and the investment adviser will waive its advisory fees for that
portion of the Master Portfolio's assets so invested, except when such purchase
is part of a plan of merger, consolidation, reorganization or acquisition.

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although these ratings may be an initial criterion for selection of portfolio
investments, BGFA also will evaluate such obligations and the ability of their
issuers to pay interest and principal. Each Master Portfolio will rely on
BGFA's judgment, analysis and experience in evaluating the creditworthiness of
an issuer. In this evaluation, BGFA will take into consideration, among other
things, the issuer's financial resources, its sensitivity to economic
conditions and trends, the quality of the issuer's management and regulatory
matters. It also is possible that a rating agency might not timely change the
rating on a particular issue to reflect subsequent events. See Item 4,
"Description of Registrant -- Risk Factors -- Fixed-Income Securities."

INVESTMENT TECHNIQUES.

A futures transaction involves a firm agreement to buy or sell
a commodity or financial instrument at a particular price on a specified future
date. Futures contracts are traded on exchanges, where the exchange serves as
the ultimate counterparty for all contracts. Consequently, the only credit
risk on futures contracts is the creditworthiness of the exchange. Futures
contracts are, however, subject to market risk (i.e., exposure to adverse price
changes). Each Master Portfolio may trade futures contracts and options on
futures contracts in U.S. domestic markets, such as the Chicago Board of Trade
and the International Monetary Market of the Chicago Mercantile Exchange.

Each Master Portfolio's futures transactions must constitute
permissible transactions pursuant to regulations promulgated by the CFTC. In
addition, a Master Portfolio may not engage in such transactions if the sum of
the amount of initial margin deposits and premiums paid for unexpired options
on futures contracts, other than for bona fide hedging transactions, would
exceed 5% of the liquidation value of the Master Portfolio's assets, after
taking into account unrealized profits and unrealized losses on such contracts;
provided, however, that in the case of an option that is in-the-money at the
time of purchase, the in-the-money amount may be excluded in calculating the
5%. Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, a Master Portfolio may be required to segregate cash, U.S.
Government obligations or other high quality money market instruments in
connection with its futures transactions in an amount generally equal to the
entire value of the underlying commitment.

Initially, when purchasing or selling futures contracts each
Master Portfolio will be required to deposit with MIP's custodian in the
broker's name an amount of cash or cash equivalents up to approximately 10% of
the contract amount. This amount is subject to change by the exchange or board
of trade on which the contract is traded and members of such exchange or board
of trade may impose their own higher requirements. This amount is known as
"initial margin" and is in the nature of a performance bond or good faith
deposit on the contract which is returned to the Master Portfolio upon
termination of the futures position, assuming all contractual obligations have
been satisfied. Subsequent payments, known as "variation margin," to and from
the broker will be made daily as the price of the index or securities
underlying the futures contract

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fluctuates, making the long and short positions in the futures contract more or
less valuable, a process known as "marking-to-market." At any time prior to
the expiration of a futures contract, the Master Portfolio may elect to close
the position by taking an opposite position, at the then prevailing price,
thereby terminating its existing position in the contract.

Although each Master Portfolio intends to purchase or sell
futures contracts only if there is an active market for such contracts, no
assurance can be given that a liquid market will exist for any particular
contract at any particular time. Many futures exchanges and boards of trade
limit the amount of fluctuation permitted in futures contract prices during a
single trading day. Once the daily limit has been reached in a particular
contract, no trades may be made that day at a price beyond that limit or
trading may be suspended for specified periods during the trading day. Futures
contract prices could move to the limit for several consecutive trading days
with little or no trading, thereby preventing prompt liquidation of futures
positions and potentially subjecting the relevant Master Portfolio to
substantial losses. If it is not possible, or the Master Portfolio determines
not, to close a futures position in anticipation of adverse price movements, it
will be required to make daily cash payments of variation margin.

An option on a futures contract gives the purchaser the right,
in return for the premium paid, to assume a position in a futures contract (a
long position if the option is a call and a short position if the option is a
put) at a specified exercise price at any time during the option exercise
period. The writer (i.e., seller) of the option is required upon exercise to
assume an offsetting futures position (a short position if the option is a call
and a long position if the option is a put). Upon exercise of the option, the
assumption of offsetting futures positions by the writer and holder of the
option will be accompanied by delivery of the accumulated cash balance in the
writer's futures margin account in the amount by which the market price of the
futures contract, at exercise, exceeds (in the case of a call) or is less than
(in the case of a put) the exercise price of the option on the futures
contract.

STOCK INDEX FUTURES AND OPTIONS ON STOCK INDEX FUTURES -- (S&P 500 Index Master
Portfolio) The S&P 500 Index Master Portfolio may purchase and sell stock index
futures contracts and options on stock index futures contracts.

A stock index future obligates the seller to deliver (and the
purchaser to take), effectively, an amount of cash equal to a specific dollar
amount times the difference between the value of a specific stock index at the
close of the last trading day of the contract and the price at which the
agreement is made. No physical delivery of the underlying stocks in the index
is made. With respect to stock indexes that are permitted investments, the S&P
500 Index Master Portfolio intends to purchase and sell futures contracts on
the stock index for which it can obtain the best price with consideration also
given to liquidity.

INTEREST RATE FUTURES CONTRACTS AND OPTIONS ON INTEREST RATE FUTURES CONTRACTS
- -- (Bond Index Master Portfolio) The Bond Index Master Portfolio may invest in
interest rate futures contracts and options on interest rate futures contracts
as a substitute for a comparable market position in the underlying securities.

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The Bond Index Master Portfolio also may sell options on
interest rate futures contracts as part of closing purchase transactions to
terminate its options positions. No assurance can be given that such closing
transactions can be effected or the degree of correlation between price
movements in the options on interest rate futures and price movements in the
Master Portfolio's portfolio securities which are the subject of the
transaction.

INTEREST RATE AND INDEX SWAPS -- Each Master Portfolio may enter into index
swaps, and the Bond Index Master Portfolio may enter into interest rate swaps,
in pursuit of its investment objective. Interest rate swaps involve the
exchange by the Bond Index Master Portfolio with another party of their
respective commitments to pay or receive interest (for example, an exchange of
floating-rate payments for fixed-rate payments). Index swaps involve the
exchange by a Master Portfolio with another party of cash flows based upon the
performance of an index or a portion of an index which usually includes
dividends or income. In each case, the exchange commitments can involve
payments to be made in the same currency or in different currencies.

The use of interest rate and index swaps is a highly
specialized activity which involves investment techniques and risks different
from those associated with ordinary portfolio security transactions. There is
no limit, except as provided below, on the amount of swap transactions that may
be entered into by a Master Portfolio. These transactions generally do not
involve the delivery of securities or other underlying assets or principal.
Accordingly, the risk of loss with respect to swaps generally is limited to the
net amount of payments that an Index Fund is contractually obligated to make.
If the other party to a swap defaults, the relevant Master Portfolio's risk of
loss consists of the net amount of payments that such Master Portfolio
contractually is entitled to receive. No Master Portfolio will invest more
than 15% of the value of its net assets in swaps that are illiquid, and in
other illiquid securities.

LENDING PORTFOLIO SECURITIES -- From time to time, each Master Portfolio may
lend securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain transactions.
Such loans may not exceed one-third of the value of the relevant Master
Portfolio's total assets. In connection with such loans, each Master Portfolio
will receive collateral consisting of cash, U.S. Government securities or
irrevocable letters of credit which will be maintained at all times in an
amount equal to at least 100% of the current market value of the loaned
securities. Each Master Portfolio can increase its income through the
investment of such collateral. Each Master Portfolio continues to be entitled
to payments in amounts equal to the dividends, interest and other distributions
payable on the loaned security and receives interest on the amount of the loan.
Such loans will be terminable at any time upon specified notice. A Master
Portfolio might experience risk of loss if the institution with which it has
engaged in a portfolio loan transaction breaches its agreement with such Master
Portfolio.

A-8
<PAGE> 69
FORWARD COMMITMENTS AND WHEN-ISSUED SECURITIES -- Each Master Portfolio may
purchase securities on a when-issued or forward commitment basis, which means
that the price is fixed at the time of commitment, but delivery and payment
ordinarily take place a number of days after the date of the commitment to
purchase. A Master Portfolio will make commitments to purchase such securities
only with the intention of actually acquiring the securities, but the Master
Portfolio may sell these securities before the settlement date if it is deemed
advisable. The Master Portfolio will not accrue income in respect of a
security purchased on a forward commitment basis prior to its stated delivery
date.

Securities purchased on a when-issued or forward commitment
basis and certain other securities held in the Master Portfolio's portfolio are
subject to changes in value (both generally changing in the same way, i.e.,
appreciating when interest rates decline and depreciating when interest rates
rise) based upon the public's perception of the creditworthiness of the issuer
and changes, real or anticipated, in the level of interest rates. Securities
purchased on a when-issued or forward commitment basis may expose the relevant
Master Portfolio to risk because they may experience such fluctuations prior to
their actual delivery. Purchasing securities on a when-issued or forward
commitment basis can involve the additional risk that the yield available in
the market when the delivery takes place actually may be higher than that
obtained in the transaction itself. A segregated account of each Master
Portfolio consisting of cash or U.S. Government obligations or other high
quality liquid debt securities in an amount at least equal at all times to the
amount of the when-issued or forward commitments is established and maintained
at MIP's custodian bank. Purchasing securities on a forward commitment basis
when a Master Portfolio is fully or almost fully invested may result in greater
potential fluctuation in the value of such Master Portfolio's total net assets
and its net asset value per share.

BORROWING MONEY -- As a fundamental policy, the Bond Index Master Portfolio may
borrow from banks up to 10% of the current value of its net assets for
temporary purposes only in order to meet redemptions, and these borrowings may
be secured by the pledge of up to 10% of the current value of its net assets
(but investments may not be purchased while any such outstanding borrowing in
excess of 5% of its total net assets exists). The S&P 500 Stock Master
Portfolio may borrow up to 20% of the current value of its net assets for
temporary purposes only in order to meet redemptions, and these borrowings may
be secured by the pledge of up to 20% of the current value of its net assets
(but investments may not be purchased while any such outstanding borrowing in
excess of 5% of its total net assets exists).

A-9
<PAGE> 70
MASTER INVESTMENT PORTFOLIO
LIFEPATH(TM) MASTER PORTFOLIOS

LIFEPATH 2000 MASTER PORTFOLIO
LIFEPATH 2010 MASTER PORTFOLIO
LIFEPATH 2020 MASTER PORTFOLIO
LIFEPATH 2030 MASTER PORTFOLIO
LIFEPATH 2040 MASTER PORTFOLIO

PART B -- STATEMENT OF ADDITIONAL INFORMATION
June 28, 1996

ITEM 10. COVER PAGE.

Master Investment Portfolio ("MIP") is an open-end, management
investment company. MIP is a "series fund," which is a mutual fund divided
into separate portfolios. This Part B is not a prospectus and should be read
in conjunction with MIP's Part A, also dated June 28, 1996. All terms used in
this Part B that are defined in Part A have the meanings assigned in Part A. A
copy of Part A may be obtained without charge by writing Stephens Inc.
("Stephens"), MIP's sponsor, administrator and placement agent, at 111 Center
Street, Little Rock, Arkansas 72201, or by calling Stephens at 1-800-643-9691.
The MIP's Registration Statement may be examined at the office of the
Securities and Exchange Commission ("SEC") in Washington, D.C.

ITEM 11. TABLE OF CONTENTS.

<TABLE>
<CAPTION>
Page
----
<S> <C>
General Information and History . . . . . . . . . . . . . . . . . 2
Investment Objectives and Policies . . . . . . . . . . . . . . . 2
Management of MIP . . . . . . . . . . . . . . . . . . . . . . . . 9
Control Persons and Principal Holders of Securities . . . . . . . 12
Investment Advisory and Other Services . . . . . . . . . . . . . 12
Brokerage Allocation and Other Practices . . . . . . . . . . . . 15
Capital Stock and Other Securities . . . . . . . . . . . . . . . 16
Purchase, Redemption and Pricing of Securities . . . . . . . . . 17
Tax Status . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Underwriters . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Calculations of Performance Data . . . . . . . . . . . . . . . . 19
Financial Information . . . . . . . . . . . . . . . . . . . . . . 19
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Financial Statements . . . . . . . . . . . . . . . . . . . . . . F-1
</TABLE>

1
<PAGE> 71
ITEM 12. GENERAL INFORMATION AND HISTORY.

Not applicable.

ITEM 13. INVESTMENT OBJECTIVES AND POLICIES.

Investment Objectives. The LifePath Master Portfolios consists of five asset
allocation funds (the "LifePath Master Portfolios") offered by MIP, an
open-end, management investment company. By this offering document, MIP is
offering the five Life Path Master Portfolios (the "LifePath Master Portfolios"
or the "Master Portfolios"), each of which is a diversified portfolio.
Organizations and other entities that hold shares of beneficial interest of a
Master Portfolio may be referred to herein as "feeder funds."

The LifePath Master Portfolios seek to provide long-term investors
in a feeder fund with an asset allocation strategy designed to maximize assets
consistent with the quantitatively measured risk such investors, on average,
may be willing to accept given their investment time horizons. The LifePath
Master Portfolios invest in a wide range of U.S. and foreign equity and debt
securities and money market instruments.

o LIFEPATH 2000 MASTER PORTFOLIO is managed for investors in
a feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2000.

o LIFEPATH 2010 MASTER PORTFOLIO is managed for investors in
a feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2010.

o LIFEPATH 2020 MASTER PORTFOLIO is managed for investors in
a feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2020.

o LIFEPATH 2030 MASTER PORTFOLIO is managed for investors in
a feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2030.

o LIFEPATH 2040 MASTER PORTFOLIO is managed for investors in
a feeder fund planning to retire (or begin to withdraw substantial portions of
their investment) approximately in the year 2040.

As with all mutual funds, there can be no assurance that the
investment objective of each Master Portfolio will be achieved. Each Master
Portfolio's investment objective cannot be changed without approval by the
holders of a majority (as defined in the Investment Company Act of 1940, as
amended (the "1940 Act")) of such Master Portfolio's outstanding voting shares.

2
<PAGE> 72
BZW Barclays Global Fund Advisors ("BGFA") serves as investment
adviser to each Master Portfolio. Prior to January 1, 1996, Wells Fargo Bank,
N.A. ("Wells Fargo Bank") served as each Master Portfolio's investment adviser
and Wells Fargo Nikko Investment Advisors ("WFNIA") served as each Master
Portfolio's sub-investment adviser. BGFA was created by the reorganization of
WFNIA with and into an affiliate of Wells Fargo Institutional Trust Company
("WFITC"), the Master Portfolios' custodian. BGFA is now a subsidiary of WFITC
which, effective January 1, 1996, changed its name to BZW Barclays Global
Investors, N.A. ("BGI"). Stephens serves as MIP's administrator and as
placement agent of each Master Portfolio's shares.

Portfolio Securities.

Bank Obligations. Domestic commercial banks organized under
federal law are supervised and examined by the Comptroller of the Currency and
are required to be members of the Federal Reserve System and to have their
deposits insured by the Federal Deposit Insurance Corporation (the "FDIC").
Domestic banks organized under state law are supervised and examined by state
banking authorities but are members of the Federal Reserve System only if they
elect to join. In addition, state banks whose certificates of deposit ("CDs")
may be purchased by each Master Portfolio are insured by the FDIC (although
such insurance may not be of material benefit to the Master Portfolio,
depending on the principal amount of the CDs of each bank held by the Master
Portfolio) and are subject to federal examination and to a substantial body of
federal law and regulation. As a result of federal or state laws and
regulations, domestic branches of domestic banks whose CDs may be purchased by
each Master Portfolio generally are required, among other things, to maintain
specified levels of reserves, are limited in the amounts which they can loan to
a single borrower and are subject to other regulations designed to promote
financial soundness. However, not all of such laws and regulations apply to
the foreign branches of domestic banks.

Obligations of foreign branches of domestic banks, foreign
subsidiaries of domestic banks and domestic and foreign branches of foreign
banks, such as CDs and time deposits ("TDs"), may be general obligations of the
parent banks in addition to the issuing branch, or may be limited by the terms
of a specific obligation and/or governmental regulation. Such obligations are
subject to different risks than are those of domestic banks. These risks
include foreign economic and political developments, foreign governmental
restrictions that may adversely affect payment of principal and interest on the
obligations, foreign exchange controls and foreign withholding and other taxes
on interest income. These foreign branches and subsidiaries are not
necessarily subject to the same or similar regulatory requirements that apply
to domestic banks, such as mandatory reserve requirements, loan limitations,
and accounting, auditing and financial record keeping requirements. In
addition, less information may be publicly available about a foreign branch of
a domestic bank or about a foreign bank than about a domestic bank.

Obligations of U.S. branches of foreign banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation or by federal or state regulation
as well as governmental action in the country in which the foreign bank has its
head office. A domestic branch of a foreign bank with assets in excess of $1
billion may be

3
<PAGE> 73
subject to reserve requirements imposed by the Federal Reserve System or by the
state in which the branch is located if the branch is licensed in that state.

In addition, federal branches licensed by the Comptroller of the
Currency and branches licensed by certain states ("State Branches") may be
required to: (1) pledge to the appropriate regulatory authority, by depositing
assets with a designated bank within the relevant state, a certain percentage
of their assets as fixed from time to time by such regulatory authority; and
(2) maintain assets within the relevant state in an amount equal to a specified
percentage of the aggregate amount of liabilities of the foreign bank payable
at or through all of its agencies or branches within the state. The deposits
of federal and State Branches generally must be insured by the FDIC if such
branches take deposits of less than $100,000.

In view of the foregoing factors associated with the purchase of
CDs and TDs issued by foreign branches of domestic banks, by foreign
subsidiaries of domestic banks, by foreign branches of foreign banks or by
domestic branches of foreign banks, BGFA carefully evaluates such investments
on a case-by-case basis.

Each Master Portfolio may purchase CDs issued by banks, savings
and loan associations and similar thrift institutions with less than $1 billion
in assets, provided that such institutions are members of the FDIC, and further
provided such Master Portfolio purchases any such CD in a principal amount of
not more than $100,000, which amount would be fully insured by the Bank
Insurance Fund or the Savings Association Insurance Fund administered by the
FDIC. Interest payments on such a CD are not insured by the FDIC. No Master
Portfolio will own more than one such CD per such issuer.

Management Policies.

Stock Index Options. Each LifePath Master Portfolio may purchase
and write (i.e., sell) put and call options on stock indices as a substitute
for comparable market positions in the underlying securities. Options on stock
indices are similar to options on stock except that (a) the expiration cycles
of stock index options are monthly, while those of stock options are currently
quarterly, and (b) the delivery requirements are different. Instead of giving
the right to take or make delivery of stock at a specified price, an option on
a stock index gives the holder the right to receive a cash "exercise settlement
amount" equal to (i) the amount, if any, by which the fixed exercise price of
the option exceeds (in the case of a put) or is less than (in the case of a
call) the closing value of the underlying index on the date of exercise,
multiplied by (ii) a fixed "index multiplier." Receipt of this cash amount
depends upon the closing level of the stock index upon which the option is
based being greater than (in the case of a call) or less than (in the case of a
put) the exercise price of the option. The amount of cash received is equal to
such difference between the closing price of the index and the exercise price
of the option expressed in dollars multiplied by a specified multiplier. The
writer of the option is obligated, in return for the premium received, to make
delivery of this amount. The writer may offset a position in stock index
options prior to expiration by entering into a closing transaction on an
exchange or the writer may let the option expire unexercised.

4
<PAGE> 74
Futures Contracts and Options on Futures Contracts. The LifePath
Master Portfolios may enter into futures contracts and may purchase and write
(i.e., sell) options thereon. Upon the exercise of an option on a futures
contract, the writer of the option delivers to the holder of the option the
futures position and the accumulated balance in the writer's futures margin
account, which represents the amount by which the market price of the futures
contract exceeds (in the case of a call) or is less than (in the case of a put)
the exercise price of the option on the futures contract. The potential loss
related to the purchase of options on futures contracts is limited to the
premium paid for the option (plus transaction costs). Because the value of the
option is fixed at the time of sale, there are no daily cash payments to
reflect changes in the value of the underlying contract; however, the value of
the option may change daily and that change would be reflected in the net asset
value of the relevant LifePath Master Portfolio.

Foreign Currency Transactions. If a LifePath Master Portfolio
enters into a foreign currency transaction or forward contract, such Master
Portfolio deposits, if required by applicable regulations, with MIP's
custodian, cash or high-grade debt securities in a segregated account of the
LifePath Master Portfolios in an amount at least equal to the value of the
LifePath Master Portfolio's total assets committed to the consummation of the
forward contract. If the value of the securities placed in the segregated
account declines, additional cash or securities is placed in the account so
that the value of the account equals the amount of the LifePath Master
Portfolio's commitment with respect to the contract.

At or before the maturity of a forward contract, a LifePath Master
Portfolio either may sell a portfolio security and make delivery of the
currency, or may retain the security and offset its contractual obligation to
deliver the currency by purchasing a second contract pursuant to which such
Master Portfolio obtains, on the same maturity date, the same amount of the
currency which it is obligated to deliver. If the LifePath Master Portfolio
retains the portfolio security and engages in an offsetting transaction, such
Master Portfolio, at the time of execution of the offsetting transaction,
incurs a gain or a loss to the extent that movement has occurred in forward
contract prices. Should forward prices decline during the period between the
LifePath Master Portfolio's entering into a forward contract for the sale of a
currency and the date it enters into an offsetting contract for the purchase of
the currency, the Master Portfolio realizes a gain to the extent the price of
the currency it has agreed to sell exceeds the price of the currency it has
agreed to purchase. Should forward prices increase, the Master Portfolio
suffers a loss to the extent the price of the currency it has agreed to
purchase exceeds the price of the currency it has agreed to sell.

The cost to the LifePath Master Portfolios of engaging in currency
transactions varies with factors such as the currency involved, the length of
the contract period and the market conditions then prevailing. Because
transactions in currency exchange usually are conducted on a principal basis,
no fees or commissions are involved. BGFA considers on an ongoing basis the
creditworthiness of the institutions with which a LifePath Master Portfolio
enters into foreign currency transactions. The use of forward currency
exchange contracts does not eliminate fluctuations in the underlying prices of
the securities, but it does establish a rate of exchange that can be achieved
in the future. If a devaluation generally is anticipated, the LifePath Master

5
<PAGE> 75
Portfolios may not be able to contract to sell the currency at a price above
the devaluation level it anticipates.

The purchase of options on currency futures allows a LifePath
Master Portfolio, for the price of the premium it must pay for the option, to
decide whether or not to buy (in the case of a call option) or to sell (in the
case of a put option) a futures contract at a specified price at any time
during the period before the option expires.

Future Developments. Each LifePath Master Portfolio may take
advantage of opportunities in the areas of options and futures contracts and
options on futures contracts and any other derivative investments which are not
presently contemplated for use by such Master Portfolio or which are not
currently available but which may be developed, to the extent such
opportunities are both consistent with a LifePath Master Portfolio's investment
objective and legally permissible for the Master Portfolio. Before entering
into such transactions or making any such investment, a LifePath Master
Portfolio would provide appropriate disclosure in its Part A or this Part B.

Lending Portfolio Securities. To a limited extent, each Master
Portfolio may lend its portfolio securities to brokers, dealers and other
financial institutions, provided it receives cash collateral which is
maintained at all times in an amount equal to at least 100% of the current
market value of the securities loaned. By lending its portfolio securities, a
Master Portfolio can increase its income through the investment of the cash
collateral or by receipt of a loan premium from the borrower. For purposes of
this policy, each Master Portfolio considers collateral consisting of U.S.
Government obligations or irrevocable letters of credit issued by banks whose
securities meet the standards for investment by such Master Portfolio to be the
equivalent of cash. From time to time, a Master Portfolio may return to the
borrower, or to a third party unaffiliated with MIP which is acting as a
"placing broker," a part of the interest earned from the investment of
collateral received in exchange for securities loaned.

The SEC currently requires that the following conditions must be
met whenever portfolio securities are loaned: (1) the Master Portfolio must
receive at least 100% cash collateral from the borrower; (2) the borrower must
increase such collateral whenever the market value of the securities loaned
rises above the level of such collateral; (3) the Master Portfolio must be able
to terminate the loan at any time; (4) the Master Portfolio must receive
reasonable interest on the loan, as well as any dividends, interest or other
distributions payable on the loaned securities, and any increase in market
value; (5) the Master Portfolio may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned securities
may pass to the borrower, MIP's Board of Trustees must terminate the loan and
regain the right to vote the securities if a material event adversely affecting
the investment occurs. These conditions may be subject to future modification.

Investment Restrictions. Each Master Portfolio has adopted
investment restrictions numbered 1 through 10 as fundamental policies. These
restrictions cannot be changed, as to a Master Portfolio, without approval by
the holders of a majority as defined in the 1940 Act of such Master Portfolio's
outstanding voting securities. Investment restrictions numbered 11 through 20

6
<PAGE> 76
are not fundamental policies and may be changed by vote of a majority of the
Trustees of MIP at any time. No Master Portfolio may:

1. Invest more than 5% of its assets in the obligations of any
single issuer, except that up to 25% of the value of its total assets may be
invested, and securities issued or guaranteed by the U.S. Government, or its
agencies or instrumentalities may be purchased, without regard to any such
limitation.

2. Hold more than 10% of the outstanding voting securities of
any single issuer. This Investment Restriction applies only with respect to
75% of its total assets.

3. Invest in commodities, except that each Master Portfolio
may purchase and sell (i.e., write) options, forward contracts, futures
contracts, including those relating to indices, and options on futures
contracts or indices.

4. Purchase, hold or deal in real estate, or oil, gas or other
mineral leases or exploration or development programs, but each Master
Portfolio may purchase and sell securities that are secured by real estate or
issued by companies that invest or deal in real estate.

5. Borrow money, except to the extent permitted under the 1940
Act. For purposes of this investment restriction, a Master Portfolio's entry
into options, forward contracts, futures contracts, including those relating to
indices, and options on futures contracts or indices shall not constitute
borrowing to the extent certain segregated accounts are established and
maintained by the Master Portfolios as described in Part A.

6. Make loans to others, except through the purchase of debt
obligations and the entry into repurchase agreements. However, each Master
Portfolio may lend its portfolio securities in an amount not to exceed
one-third of the value of its total assets. Any loans of portfolio securities
will be made according to guidelines established by the Securities and Exchange
Commission and MIP's Board of Trustees.

7. Act as an underwriter of securities of other issuers,
except to the extent the Master Portfolios may be deemed an underwriter under
the Securities Act of 1933, as amended, by virtue of disposing of portfolio
securities.

8. Invest 25% or more of its total assets in the securities of
issuers in any particular industry or group of closely related industries,
except that, in the case of each Master Portfolio, there shall be no limitation
on the purchase of obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.

9. Issue any senior security (as such term is defined in
Section 18(f) of the 1940 Act), except to the extent the activities permitted
in Investment Restriction Nos. 3, 5, 12 and 13 may be deemed to give rise to a
senior security.

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<PAGE> 77
10. Purchase securities on margin, but each Master Portfolio
may make margin deposits in connection with transactions in options, forward
contracts, futures contracts, including those relating to indices, and options
on futures contracts or indices.

11. Invest in the securities of a company for the purpose of
exercising management or control, but each Master Portfolio will vote the
securities it owns in its portfolio as a shareholder in accordance with its
views.

12. Pledge, mortgage or hypothecate its assets, except to the
extent necessary to secure permitted borrowings and to the extent related to
the purchase of securities on a when-issued or forward commitment basis and the
deposit of assets in escrow in connection with writing covered put and call
options and collateral and initial or variation margin arrangements with
respect to options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices.

13. Purchase, sell or write puts, calls or combinations
thereof, except as may be described in the Master Portfolios' offering
documents.

14. Purchase securities of any company having less than three
years' continuous operations (including operations of any predecessors) if such
purchase would cause the value of its investments in all such companies to
exceed 5% of the value of its total assets.

15. Enter into repurchase agreements providing for settlement
in more than seven days after notice or purchase securities which are illiquid,
if, in the aggregate, more than 15% of the value of its net assets would be so
invested. Although each feeder fund and LifePath Master Portfolio reserves the
right to invest up to 15% of the value of its net assets in repurchase
agreements providing for settlement in more than seven days after notice and in
other illiquid securities, as long as such feeder fund's shares are registered
for sale in a state that imposes a lower limit on the percentage of a fund's
assets that may be so invested, such feeder fund and LifePath Master Portfolio
will comply with the lower limit. Each feeder fund currently is limited to
investing up to 10% of the value of its net assets in such securities due to
limits applicable in several states.

16. Purchase securities of other investment companies, except
to the extent permitted under the 1940 Act.

17. Purchase, hold or deal in real estate limited partnerships.

18. Purchase warrants that exceed 2% of the value of the Master
Portfolio's net assets, if those warrants are not listed on the New York or
American Stock Exchanges.

19. Purchase or retain securities of any issuer if the
officers, and trustees of the Trust, its advisers or managers owing
beneficially more than one-half of one percent of the securities of an issuer
together own beneficially more than five percent of the securities of that
issuer.

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<PAGE> 78
20. Engage in any short sales other than short sales against
the box.

If a percentage restriction is adhered to at the time of
investment, a later change in percentage resulting from a change in values or
assets, except with respect to compliance with Investment Restriction No. 5,
will not constitute a violation of such restriction.

ITEM 14. MANAGEMENT OF MIP.

The following information supplements and should be read in
conjunction with the Part A section entitled "Management of the Master
Portfolio". The Trustees and Principal Officer of MIP, together with
information as to their principal business occupations during at least the last
five years, are shown below. The address of each, unless otherwise indicated,
is 111 Center Street, Little Rock, Arkansas 72201. Each Trustee who is deemed
to be an "interested person" of MIP, as defined in the 1940 Act, is indicated
by an asterisk.

<TABLE>
<CAPTION>
Principal Occupations
Name, Address and Age Position During Past 5 Years
- --------------------- -------- ---------------------
<S> <C> <C>
Jack S. Euphrat, 74 Trustee Private Investor.
415 Walsh Road
Atherton, CA 94027.

*R. Greg Feltus, 45 Trustee, Senior Vice President of Stephens;
Chairman and Manager of Financial Services
President Group; President of Stephens Insurance Services
Inc.; Senior Vice President of Stephens Sports
Management Inc.; and President of Investors
Brokerage Insurance Inc.

Thomas S. Goho, 54 Trustee T.B. Rose Faculty Fellow-Business,
321 Beechcliff Court Wake Forest University, Calloway
Winston-Salem, NC 27104 School of Business and Accounting;
Associate Professor of Finance of the
School of Business and Accounting
at Wake Forest University since
1983.
</TABLE>

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<PAGE> 79
<TABLE>
<CAPTION>
Principal Occupations
Name, Address and Age Position During Past 5 Years
- --------------------- -------- ---------------------
<S> <C> <C>
*Zoe Ann Hines, 47 Trustee Senior Vice President of Stephens
and Director of Brokerage
Accounting; and Secretary of
Stephens Resource Management.

*W. Rodney Hughes, 70 Trustee Private Investor.
31 Dellwood Court
San Rafael, CA 94901

Robert M. Joses, 78 Trustee Private Investor.
47 Dowitcher Way
San Rafael, CA 94901

*J. Tucker Morse, 52 Trustee Private Investor; Real Estate
10 Legrae Street Developer; Chairman of Renaissance
Charleston, SC 29401 Properties Ltd; President of Morse
Investment Corporation; and
Co-Managing Partner of Main Street
Ventures.

Richard H. Blank, Jr., 40 Chief Associate of Financial Services
Operating Group of Stephens; Director of
Officer, Stephens Sports Management Inc.;
Secretary and and Director of Capo Inc.
Treasurer
</TABLE>

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<PAGE> 80
COMPENSATION TABLE
For the Fiscal Year Ended February 29, 1996

<TABLE>
<CAPTION>
Total Compensation
Aggregate Compensation from Registrant
Name and Position from Registrant and Fund Complex
- ----------------- ---------------------- ------------------
<S> <C> <C>
Jack S. Euphrat $0 $39,000
Trustee

*R. Greg Feltus 0 0
Trustee

Thomas S. Goho 0 39,000
Trustee

*Zoe Ann Hines 0 0
Trustee

*W. Rodney Hughes 0 36,250
Trustee

Robert M. Joses 0 38,250
Trustee

*J. Tucker Morse 0 33,000
Trustee
</TABLE>

Trustees of MIP are compensated annually by MIP and by all the
registrants in the fund complex for their services as indicated above and also
are reimbursed for all out-of-pocket expenses relating to attendance at board
meetings. Each of the Trustees and the Principal Officer of MIP serves in the
identical capacity as Directors/Trustees and/or Principal Officer of
MasterWorks Funds Inc. ("MasterWorks" formerly, Stagecoach Inc.), Managed
Series Investment Trust ("MSIT"), Stagecoach Funds, Inc., Overland Express
Funds, Inc., Stagecoach Trust, Life & Annuity Trust and Master Investment
Trust, each of which is a registered open-end management investment company and
each of which, prior to January 1, 1996 and the reorganization of WFNIA, was
considered to be in the same "fund complex," as such term is defined in Form
N-1A under the 1940 Act, as the Trust. Effective January 1, 1996, MIP,
MasterWorks and MSIT are considered to be members of the same fund complex and
are no longer part of the same fund complex as Stagecoach Funds, Inc., Overland
Express Funds, Inc., Stagecoach Trust, Life & Annuity Trust and Master
Investment Trust. The Trustees are compensated by other Companies and Trusts
within the fund complex for their services as Directors/Trustees to such
Companies and Trusts. Currently, the Trustees do not receive any retirement
benefits or deferred compensation from MIP or any other member of the fund
complex.

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<PAGE> 81
As of the date of this SAI, the Trustees and Principal Officer of
MIP as a group beneficially owned less than 1% of the outstanding beneficial
interest of MIP.

ITEM 15. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.

As of June 25, 1996, the following funds of MasterWorks Funds Inc.
and Stagecoach Trust each held more than 5% of the outstanding voting
securities of the indicated LifePath Master Portfolio and, as such, could
be considered controlling persons for purposes of the 1940 Act of the
corresponding Master Portfolio.

<TABLE>
<CAPTION>
% Outstanding
Master Portfolio Fund Securities Held
- ---------------- ---- ---------------
<S> <C> <C>
LifePath 2000 Master Portfolio MasterWorks LifePath 2000 28%
Stagecoach LifePath 2000 72%

LifePath 2010 Master Portfolio MasterWorks LifePath 2010 45%
Stagecoach LifePath 2010 55%

LifePath 2020 Master Portfolio MasterWorks LifePath 2020 37%
Stagecoach LifePath 2020 63%

LifePath 2030 Master Portfolio MasterWorks LifePath 2030 30%
Stagecoach LifePath 2030 70%

LifePath 2040 Master Portfolio MasterWorks LifePath 2040 22%
Stagecoach LifePath 2040 78%
</TABLE>

ITEM 16. INVESTMENT ADVISORY AND OTHER SERVICES.

The following information supplements and should be read in conjunction with
Item 5 in Part A.

Investment Adviser. BGFA provides investment advisory services to
each Master Portfolio pursuant to separate Investment Advisory Contracts (each,
a "BGFA Advisory Contract") each dated January 1, 1996 with MIP. As to each
Master Portfolio, the applicable BGFA Advisory Contract is subject to annual
approval by (i) MIP's Board of Trustees or (ii) vote of a majority (as defined
in the 1940 Act) of the outstanding voting securities of such Master Portfolio,
provided that in either event the continuance also is approved by a majority of
MIP's Board of Trustees who are not "interested persons" (as defined in the
1940 Act) of MIP or BGFA, by vote cast in person at a meeting called for the
purpose of voting on such approval. As to each Master Portfolio, the
applicable BGFA Advisory Contract is terminable without penalty, on 60 days'
written notice, by MIP's Board of Trustees or by vote of the holders of a
majority of

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<PAGE> 82
such Master Portfolio's shares, or, after the Reapproval Date, on not less than
60 days' written notice, by BGFA. The applicable BGFA Advisory Contract
terminates automatically, as to the relevant Master Portfolio, in the event of
its assignment (as defined in the 1940 Act).

Prior to January 1, 1996, Wells Fargo Bank provided investment
advisory services to each Master Portfolio pursuant to the Investment Advisory
Agreement (the "Advisory Agreement") dated February 25, 1994 with MIP. The
terms of the Advisory Agreement were identical in all material respects, other
than the identity of the parties, to each BGFA Advisory Agreement.

Advisory Fees Paid. For the fiscal year ended February 28, 1995
and the period from March 1, 1995 to December 31, 1995, the Master Portfolios
paid to Wells Fargo Bank the advisory fees indicated below and Wells Fargo Bank
waived the indicated amounts. For the period beginning January 1, 1996 and
ended February 29, 1996, the Master Portfolios paid to BGFA the advisory fees
indicated below and BGFA waived the indicated amounts:

<TABLE>
<CAPTION>
Fiscal Year Ended March 1, 1995 - January 1, 1996 -
February 28, 1995 December 31, 1995 February 29, 1996
Master Portfolio Fees Paid Fees Waived Fees Paid Fees Waived Fees Paid Fees Waived
- ---------------- ------------------------ ----------------------- ------------------------
<S> <C> <C> <C> <C> <C> <C>
LifePath 2000 Master Portfolio $217,676 $0 $363,599 $0 $ 99,512 $0

LifePath 2010 Master Portfolio $158,218 $0 $312,512 $0 $ 86,920 $0

LifePath 2020 Master Portfolio $252,413 $0 $520,362 $0 $141,076 $0

LifePath 2030 Master Portfolio $156,397 $0 $343,916 $0 $ 93,241 $0

LifePath 2040 Master Portfolio $189,121 $0 $503,384 $0 $148,325 $0
</TABLE>

Sub-Adviser. The Master Portfolios do not currently engage a
sub-adviser. However, prior to January 1, 1996, WFNIA provided sub-investment
advisory services to each Master Portfolio pursuant to a Sub-Investment
Advisory Agreement (the "Sub-Advisory Agreement") dated February 25, 1994 with
Wells Fargo Bank and MIP.

Sub-Advisory Fees Paid. For the fiscal year ended February 28,
1995 and the period beginning March 1, 1995 and ended December 31, 1995, Wells
Fargo Bank paid the following sub-advisory fees to WFNIA and WFNIA waived the
indicated amounts:
<TABLE>
<CAPTION>
Fiscal Year Ended Period Ended
February 28, 1995 December 31, 1995
Fees Paid Fees Waived Fees Paid Fees Waived
------------------------- ----------------------------
<S> <C> <C> <C> <C>
LifePath 2000 Master Portfolio $159,494 $0 $261,344 $0
LifePath 2010 Master Portfolio $115,647 $0 $224,903 $0
LifePath 2020 Master Portfolio $184,341 $0 $374,802 $0
LifePath 2030 Master Portfolio $114,426 $0 $247,703 $0
LifePath 2040 Master Portfolio $138,511 $0 $361,673 $0
</TABLE>

13
<PAGE> 83
Administrator. Stephens provides administrative services to MIP
pursuant to an Administration Agreement dated February 25, 1994 (the
"Administration Agreement"). Under the Administration Agreement, Stephens
provides as administrative services, among other things: (i) general
supervision of the operation of MIP and the Master Portfolios, including
coordination of the services performed by the investment adviser, transfer and
dividend disbursing agent, custodian, interestholder servicing agent(s),
independent auditors and legal counsel; (ii) general supervision of regulatory
compliance matters, including the compilation of information for documents such
as reports to, and filings with, the SEC and state securities commissions, and
preparation of proxy statements and interestholder reports for the Master
Portfolios; and (iii) general supervision relative to the compilation of data
required for the preparation of periodic reports distributed to MIP's officers
and Board of Trustees. Stephens also furnishes office space and certain
facilities required for conducting the business of MIP together with those
ordinary clerical and bookkeeping services that are not being furnished by the
Master Portfolios' investment adviser. Stephens also pays the compensation of
MIP's Trustees, officers and employees who are affiliated with Stephens.

Stephens is not entitled to compensation for providing
administrative services to a Master Portfolio so long as Stephens receives fees
for providing similar services to a fund of another investment company which
invests all of its assets in such Master Portfolio. For the fiscal years ended
February 28, 1995 and February 29, 1996, the Master Portfolios did not pay any
administrative fees to Stephens.

Distribution Plan. MIP's Board of Trustees has adopted, on behalf
of each Master Portfolio, a "defensive" distribution plan under Section 12(b)
of the 1940 Act and Rule 12b-1 thereunder (the "Plan"). The Plan was adopted
by a majority of MIP's Board of Trustees (including a majority of those
Trustees who are not "interested persons" as defined in the 1940 Act of MIP) on
October 10, 1995. The Plan was intended as a precaution designed to address
the possibility that certain ongoing payments by Barclays to Wells Fargo Bank
in connection with the sale of WFNIA may be characterized as indirect payments
by each Master Portfolio to finance activities primarily intended to result in
the sale of interests in such Master Portfolio. The Plan provides that if any
portion of a Master Portfolio's advisory fees (up to 0.25% of the average daily
net assets of each Master Portfolio on an annual basis) were deemed to
constitute an indirect payment for activities that are primarily intended to
result in the sale of interests in a Master Portfolio such payment would be
authorized pursuant to the Plan. The Master Portfolios do not currently pay
any amounts pursuant to the Plan.

Custodian, Transfer and Dividend Disbursing Agent. BZW Barclays
Global Investors, N.A., ("BGI"), a wholly- owned subsidiary of BZW Barclays
Global Investors Holdings Inc. (formerly, The Nikko Building U.S.A., Inc.),
acts as custodian to MIP. The custodian, among other things, maintains a
custody account or accounts in the name of MIP; receives and delivers all
assets for MIP upon purchase and upon sale or maturity; collects and receives
all income and other payments and distributions on account of the assets of MIP
and pays all expenses of MIP. For the fiscal year ended February 29, 1996, the
Master Portfolios did not pay any Custody fees. Wells Fargo Bank acts as MIP's
transfer and dividend disbursing agent and performs such services at 525 Market
Street, San Francisco, California 94105. Wells Fargo Bank is not entitled

14
<PAGE> 84
to receive compensation for providing such services to MIP so long as it
receives fees for providing similar services to the funds which invest
substantially all of their assets in the Master Portfolios. For the fiscal
year ended February 29, 1996, the Master Portfolios did not pay any transfer
and dividend disbursing agency fees.

ITEM 17. BROKERAGE ALLOCATION AND OTHER PRACTICES.

General. BGFA assumes general supervision over placing orders
on behalf of each Master Portfolio for the purchase or sale of portfolio
securities. Allocation of brokerage transactions, including their frequency,
is made in the best judgment of BGFA and in a manner deemed fair and reasonable
to interestholders. In executing portfolio transactions and selecting brokers
or dealers, BGFA seeks to obtain the best overall terms available for each
Master Portfolio. In assessing the best overall terms available for any
transaction, BGFA considers factors deemed relevant, including the breadth of
the market in the security, the price of the security, the financial condition
and execution capability of the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a continuing
basis. A primary consideration is prompt execution of orders at the most
favorable net price. Certain of the brokers or dealers with whom the Master
Portfolios may transact business offer commission rebates to the Master
Portfolios. BGFA considers such rebates in assessing the best overall terms
available for any transaction. The overall reasonableness of brokerage
commissions paid is evaluated by BGFA based upon its knowledge of available
information as to the general level of commission paid by other institutional
investors for comparable services. Prior to January 1, 1996, WFNIA exercised
general supervision over placing orders on behalf of each Master Portfolio for
the purchase or sale of portfolio securities and the brokerage allocation
practices described herein are applicable to WFNIA and the Master Portfolios
prior to January 1, 1996.

Brokers also are selected because of their ability to handle
special executions such as are involved in large block trades or broad
distributions, provided the primary consideration is met. Portfolio turnover
may vary from year to year, as well as within a year. Portfolio turnover rates
over 100% (although unexpected) may result in comparatively greater brokerage
expenses.

Purchases and sales of fixed-income securities usually are
principal transactions. Portfolio securities ordinarily are purchased directly
from the issuer or from an underwriter or market maker. Usually no brokerage
commissions are paid by the LifePath Master Portfolios for such purchases and
sales. The prices paid to the underwriters of newly-issued securities usually
include a concession paid by the issuer to the underwriter, and purchases of
securities from market makers may include the spread between the bid and asked
price.

Brokerage Commissions. For the fiscal years ended February 28,
1995 and February 29, 1996 the Master Portfolios paid brokerage commissions in
the dollar amounts shown below. For the fiscal years ended February 28, 1995
and February 29, 1996, none of the brokerage commissions were paid to
affiliated brokers.

<TABLE>
<CAPTION>
Master Portfolio 1995 1996
- ---------------- ---- ----
<S> <C> <C>
LifePath 2000 Master Portfolio $24,231 $ 8,312
LifePath 2010 Master Portfolio $28,830 $12,055
LifePath 2020 Master Portfolio $56,540 $29,669
LifePath 2030 Master Portfolio $37,890 $33,785
LifePath 2040 Master Portfolio $56,183 $71,616
</TABLE>

15
<PAGE> 85
Securities of Regular Broker/Dealers. On February 29, 1996, the
LifePath Master Portfolios owned securities of their "regular brokers or
dealers" or their parents, as defined in the 1940 Act, as follows:

<TABLE>
<CAPTION>
Master Portfolio Regular Broker/Dealer Amount
- ---------------- --------------------- ------
<S> <C> <C>
LifePath 2000 CitiCorp $ 92,000
Master Portfolio Lehman Brothers Holdings 30,000
Merrill Lynch & Co. 29,000
J.P. Morgan Securities 40,000

LifePath 2010 CitiCorp $295,000
Master Portfolio Lehman Brothers Holdings 25,500
Merrill Lynch & Co. 79,000
J.P. Morgan Securities 123,000

LifePath 2020 CitiCorp $549,000
Master Portfolio Lehman Brothers Holdings 45,000
Merrill Lynch & Co. 170,000
J.P. Morgan Securities 255,000

LifePath 2030 CitiCorp $431,000
Master Portfolio Lehman Brothers Holdings 40,000
Merrill Lynch & Co. 134,000
J.P. Morgan Securities 198,000

LifePath 2040 CitiCorp $784,000
Master Portfolio Lehman Brothers Holdings 79,000
Merrill Lynch & Co. 213,000
J.P. Morgan Securities 319,000
</TABLE>

ITEM 18. CAPITAL STOCK AND OTHER SECURITIES.

Pursuant to MIP's Declaration of Trust, the Trustees are
authorized to issue beneficial interests in each Master Portfolio. Investors
in a Master Portfolio are entitled to participate pro rata in distributions of
taxable income, loss, gain and credit of such Master Portfolio. Upon
liquidation or dissolution of a Master Portfolio, investors are entitled to
share pro rata in such Master Portfolio's net assets available for distribution
to its investors. Investments in a Master Portfolio have no preference,
pre-exemptive, conversion or similar rights and are fully paid and
non-assessable, except as set forth below. Investments in a Master Portfolio
may not be transferred. No certificates are issued.

Each investor is entitled to vote, with respect to matters
effecting each of MIP's portfolios, in proportion to the amount of its
investment in MIP. Investors in MIP do not have

16
<PAGE> 86
cumulative voting rights, and investors holding more than 50% of the aggregate
beneficial interest in MIP may elect all of the Trustees of MIP if they choose
to do so and in such event the other investors in MIP would not be able to
elect any Trustee. MIP is not required to hold annual meetings of investors
but MIP may hold special meetings of investors when in the judgment of MIP's
Trustees it is necessary or desirable to submit matters for an investor vote.

Rule 18f-2 under the 1940 Act provides that any matter required
to be submitted under the provisions of the 1940 Act or applicable state law or
otherwise to the holders of the outstanding voting securities of an investment
company, such as MIP, will not be deemed to have been effectively acted upon
unless approved by the holders of a majority of the outstanding interests of
each Master Portfolio affected by such matter. Rule 18f-2 further provides
that a Master Portfolio shall be deemed to be affected by a matter unless it is
clear that the interests of such Master Portfolio in the matter are identical
or that the matter does not affect any interest of such Master Portfolio.
However, the Rule exempts the selection of independent auditors and the
election of Trustees from the separate voting requirements of the Rule.

ITEM 19. PURCHASE, REDEMPTION AND PRICING OF SECURITIES.

Purchase of Securities. Beneficial interests in each Master
Portfolio are issued solely in private placement transactions which do not
involve any "public offering" within the meaning of Section 4(2) of the
Securities Act of 1933, as amended (the "1933 Act"). Investments in the Master
Portfolios may only be made by investment companies or certain other entities
which are "accredited investors" within the meaning of Regulation D under the
1933 Act. This registration statement does not constitute an offer to sell, or
the solicitation of an offer to buy, any "security" within the meaning of the
1933 Act.

Suspension of Redemptions. The right of redemption of interests
in the Master Portfolios may be suspended or the date of payment postponed (a)
during any period when the New York Stock Exchange is closed (other than
customary weekend and holiday closings), (b) when trading in the markets the
Master Portfolios ordinarily utilize is restricted, or when an emergency exists
as determined by the SEC so that disposal of the Master Portfolios' investments
or determination of its net asset value is not reasonably practicable, or (c)
for such other periods as the SEC by order may permit to protect the Master
Portfolios' interestholders.

Pricing of Securities. The securities of each of the LifePath
Master Portfolios, including covered call options written by a LifePath Master
Portfolio, are valued at the last sale price on the securities exchange or
national securities market on which such securities primarily are traded.
Securities not listed on an exchange or national securities market, or
securities in which there were no transactions, are valued at the most recent
bid prices. Portfolio securities which are traded primarily on foreign
securities exchanges generally are valued at the preceding closing values of
such securities on their respective exchanges, except that when an occurrence
subsequent to the time a value was so established is likely to have changed
such value, then the fair value of those securities are determined by BGFA in
accordance with guidelines approved by MIP's Board of Trustees. Short-Term
investments are carried at amortized cost, which approximates market value.
Any securities or other assets for which recent market quotations are

17
<PAGE> 87
not readily available are valued at fair value as determined in good faith by
BGFA in accordance with guidelines approved by MIP's Board of Trustees.

Restricted securities, as well as securities or other assets for
which market quotations are not readily available or which are not valued by a
pricing service approved by MIP's Board of Trustees, are valued at fair value
as determined in good faith by or under the direction of MIP's Board of
Trustees or its delegates. MIP's Board of Trustees reviews the method of
valuation on a current basis. In making a good faith valuation of restricted
securities, the following are generally considered: restricted securities that
are, or are convertible into, securities of the same class of securities for
which a public market exists usually are valued at market value less the same
percentage discount at which such securities were purchased. This discount may
be revised periodically if BGFA believes that the discount no longer reflects
the value of the restricted securities. Restricted securities not of the same
class as securities for which a public market exists usually are valued
initially at cost. Any subsequent adjustment from cost is based upon
considerations deemed relevant by or under the direction of MIP's Board of
Trustees or its delegates.

Any assets or liabilities initially expressed in terms of
foreign currency are translated into dollars using information provided by
pricing entities, such as Morgan Stanley Capital International or Gelderman
Data Service, or at a quoted market exchange rate as may be determined to be
appropriate by BGFA. Forward currency contracts are valued at the current cost
of offsetting the contract. Because of the need to obtain prices as of the
close of trading on various exchanges throughout the world, the calculation of
net asset value does not take place contemporaneously with the determination of
prices of the foreign securities held by the LifePath Master Portfolios. In
addition, foreign securities held by a LifePath Master Portfolio may be traded
actively in securities markets which are open for trading on days when the
LifePath Master Portfolio does not determine its net asset value. Accordingly,
there may be occasions when a LifePath Master Portfolio does not calculate its
net asset value but when the value of such Master Portfolio's portfolio
securities is affected by such trading activity.

Fixed-income securities are valued each business day using
available market quotations or at fair value as determined by one or more
independent pricing services (collectively, the "Services") approved by MIP's
Board of Trustees. Each Service may use available market quotations, employ
electronic data processing techniques and/or a matrix system to determine
valuations. The Services' procedures are reviewed by MIP's officers under the
general supervision of MIP's Board of Trustees.

Expenses and fees, including advisory fees, are accrued daily
and are taken into account for the purpose of determining the net asset value
of a LifePath Master Portfolio's shares.

New York Stock Exchange Closings. The holidays on which the New
York Stock Exchange is closed currently are: New Year's Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day.

18
<PAGE> 88
ITEM 20. TAX STATUS.

MIP is organized as a business trust under Delaware law. MIP
will be considered a non-publicly traded partnership for federal income tax
purposes. In addition, each Master Portfolio of MIP will be considered a non-
publicly traded partnership for federal income tax purposes, and as such, it
will not be subject to federal income tax. However, each investor in a Master
Portfolio will be taxable on its share (as determined in accordance with the
governing instruments of MIP) of such Master Portfolio's taxable income in
determining its federal income tax liability. The determination of such share
is made in accordance with the Internal Revenue Code of 1986, as amended (the
"Code"), and regulations promulgated thereunder.

MIP's taxable year-end is the last day of February. Although
MIP is not subject to federal income tax, it files appropriate federal income
tax returns.

Each Master Portfolio's assets, income and distributions are
managed in such a way that an investor in the Master Portfolio may satisfy the
requirements of Subchapter M of the Code, assuming that the investor invested
substantially all of its investable assets in the Master Portfolio. Investors
are advised to consult their own tax advisors as to the tax consequences of an
investment in the Master Portfolios.

ITEM 21. UNDERWRITERS.

The exclusive placement agent for MIP is Stephens, which
receives no compensation for serving in this capacity. Registered
broker/dealers and investment companies, insurance company separate accounts,
common and commingled trust funds, group trusts and similar organizations and
entities which constitute accredited investors, as defined in the regulations
adopted under the 1933 Act, may continuously invest in a Master Portfolio of
MIP.

ITEM 22. CALCULATIONS OF PERFORMANCE DATA.

Not applicable.

ITEM 23. FINANCIAL INFORMATION.

KPMG Peat Marwick LLP provides audit services, tax return
preparation and assistance and consultation in connection with review of
certain SEC filings. KPMG Peat Marwick LLP's address is Three Embarcadero
Center, San Francisco, California 94111. For the fiscal year ended February
28, 1995, MIP's financial statements were audited by other independent
auditors. Such auditors expressed an unqualified opinion on the financial
statements of MIP.

19
<PAGE> 89
The portfolio of investments, audited financial statements and
independent auditors' report for the LifePath Master Portfolios for the fiscal
year ended February 29, 1996 are hereby incorporated by reference to the
Stagecoach LifePath Funds Annual Reports, as filed with the SEC on May 28,
1996. The portfolio of investments, audited financial statements and
independent auditors' report for the LifePath Master Portfolios are attached to
all Part Bs delivered to interestholders or prospective interestholders.

20
<PAGE> 90
APPENDIX

Description of certain ratings assigned by Standard & Poor's
Corporation ("S&P"), Moody's Investors Service, Inc. ("Moody's"), Fitch
Investors Service, Inc. ("Fitch"), Duff & Phelps, Inc. ("Duff") and IBCA Inc.
and IBCA Limited ("IBCA"):

S&P

Bond Ratings

AAA

Bonds rated "AAA" have the highest rating assigned by S&P.
Capacity to pay interest and repay principal is extremely strong.

Bonds rated "AA" have a very strong capacity to pay interest and
repay principal and differ from the highest rated issues only in small degree.

Bonds rated "A" have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in higher
rated categories.

BBB

Bonds rated "BBB" are regarded as having an adequate capacity to
pay interest and repay principal. Whereas they normally exhibit 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 bonds in this category than for bonds in higher rated categories.

S&P's letter ratings may be modified by the addition of a plus
(+) or minus (-) sign designation, which is used to show relative standing
within the major rating categories, except in the "AAA" (Prime Grade) category.

Commercial Paper Rating

The designation "A-1" by S&P indicates that the degree of safety
regarding timely payment is strong. Those issues determined to possess
overwhelming safety characteristics are denoted with a plus sign (+)
designation. Capacity for timely payment on issues with an "A-2" designation
is satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1".

A-1
<PAGE> 91
Moody's

Bond Ratings

Aaa

Bonds which are rated "Aaa" are judged to be of the best
quality. They carry the smallest degree of investment risk and are generally
referred to as "gilt edge." 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 which are rated "Aa" are judged to be of high quality by
all standards. Together with the Aaa group they comprise what generally are
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 which are rated "A" 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 sometime in the
future.

Baa

Bonds which are rated "Baa" 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 the numerical modifiers "1", "2" and "3" to show
relative standing within the major rating categories, except in the "Aaa"
category. The modifier "1" indicates a ranking for the security in the higher
end of a rating category; the modifier "2" indicates a mid-range ranking; and
the modifier "3" indicates a ranking in the lower end of a rating category.

Commercial Paper Rating

The rating Prime-1 ("P-1") is the highest commercial paper
rating assigned by Moody's. Issuers of "P-1" paper must have a superior
capacity for repayment of short-term

A-2
<PAGE> 92
promissory obligations, and this ordinarily is evidenced by leading market
positions in well established industries, high rates of return on funds
employed, conservative capitalization structures with moderate reliance on debt
and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established
access to a range of financial markets and assured sources of alternate
liquidity.

Issuers (or relating supporting institutions) rated Prime-2
("P-2") have a strong capacity for repayment of short-term promissory
obligations. This ordinarily is evidenced by many of the characteristics cited
above but to a lesser degree. Earnings trends and coverage ratios, while
sound, are more subject to variation. Capitalization characteristics, while
still appropriate, may be more affected by external conditions. Ample
alternate liquidity is maintained.

Fitch

Bond Ratings

The ratings represent Fitch's assessment of the issuer's ability
to meet the obligations of a specific debt issue or class of debt in a timely
manner. The ratings take into consideration special features of the issue, its
relationship to other obligations of the issuer, the current financial
condition and operative performance of the issuer and of any guarantor, as well
as the political and economic environment that might affect the issuer's future
financial strength and credit quality.

AAA

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
issuers is generally rated "F-1+".

Bonds rated "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.

BBB

A-3
<PAGE> 93
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 an adverse impact on these
bonds and, therefore, impair timely payment. The likelihood that the ratings
of these bonds will fall below investment grade is higher than for bonds with
higher ratings.

Plus (+) and minus (-) signs are used with a rating symbol to
indicate the relative position of a credit within the rating category.

Short-Term Ratings

Fitch's short-term ratings apply to debt obligations that are
payable on demand or have original maturities of up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal and
investment notes.

Although the credit analysis is similar to Fitch's bond rating
analysis, the short-term rating places greater emphasis than bond ratings on
the existence of liquidity necessary to meet the issuer's obligations in a
timely manner.

F-1+

Exceptionally Strong Credit Quality. Issues assigned this
rating are regarded as having the strongest degree of assurance for timely
payment.

F-1

Very Strong Credit Quality. Issues assigned this rating reflect
an assurance of timely payment only slightly less in degree than issues rated
"F-1+".

F-2

Good Credit Quality. Issues carrying this rating have a
satisfactory degree of assurance for timely payments, but the margin of safety
is not as great as the "F-1+" and "F-1" categories.

Duff

Bond Ratings

AAA

Bonds rated "AAA" are considered highest credit quality. The
risk factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.

A-4
<PAGE> 94
AA

Bonds rated "AA" are considered high credit quality. Protection
factors are strong. Risk is modest but may vary slightly from time to time
because of economic conditions.

Bonds rated "A" have protection factors which are average but
adequate. However, risk factors are more variable and greater in periods of
economic stress.

BBB

Bonds rated "BBB" are considered to have below average
protection factors but still considered sufficient for prudent investment.
Considerable variability in risk during economic cycles.

Plus (+) and minus (-) signs are used with a rating symbol
(except "AAA") to indicate the relative position of a credit within the rating
category.

Commercial Paper Rating

The rating "Duff-1" is the highest commercial paper rating
assigned by Duff. Paper rated "Duff-1" is regarded as having very high
certainty of timely payment with excellent liquidity factors which are
supported by ample asset protection. Risk factors are minor. Paper rated
"Duff-2" is regarded as having good certainty of timely payment, good access to
capital markets and sound liquidity factors and company fundamentals. Risk
factors are small.

IBCA

Bond and Long-Term Ratings

Obligations rated "AAA" by IBCA have 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
for which there is a very low expectation of investment risk are rated "AA" by
IBCA. 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.

A-5
<PAGE> 95
Commercial Paper and Short-Term Ratings

The designation "A1" by IBCA indicates that the obligation is
supported by a very strong capacity for timely repayment. Those obligations
rated "A1+" are supported by the highest capacity for timely repayment.
Obligations rated "A2" are supported by a strong capacity for timely repayment,
although such capacity may be susceptible to adverse changes in business,
economic or financial conditions.

International and U.S. Bank Ratings

An IBCA bank rating represents IBCA's current assessment of the
strength of the bank and whether such bank would receive support should it
experience difficulties. In its assessment of a bank, IBCA uses a dual rating
system comprised of Legal Ratings and Individual Ratings. In addition, IBCA
assigns banks Long- and Short-Term Ratings as used in the corporate ratings
discussed above. Legal Ratings, which range in gradation from 1 through 5,
address the question of whether the bank would receive support provided by
central banks or interestholders if it experienced difficulties, and such
ratings are considered by IBCA to be a prime factor in its assessment of credit
risk. Individual Ratings, which range in gradations from A through E,
represent IBCA's assessment of a bank's economic merits and address the
question of how the bank would be viewed if it were entirely independent and
could not rely on support from state authorities or its owners.

A-6
<PAGE> 96
MASTER INVESTMENT PORTFOLIO
ALLOCATION MASTER PORTFOLIOS

ASSET ALLOCATION MASTER PORTFOLIO
U.S. TREASURY ALLOCATION MASTER PORTFOLIO

PART B -- STATEMENT OF ADDITIONAL INFORMATION
June 28, 1996

ITEM 10. COVER PAGE.

Master Investment Portfolio ("MIP") is an open-end, management
investment company. MIP is a "series fund," which is a mutual fund divided
into separate portfolios. This Part B is not a prospectus and should be read
in conjunction with MIP's Part A, also dated June 28, 1996. All terms used in
this Part B that are defined in Part A have the meanings assigned in Part A. A
copy of Part A may be obtained without charge by writing Stephens Inc.
("Stephens"), MIP's sponsor, administrator and placement agent, at 111 Center
Street, Little Rock, Arkansas 72201, or by calling Stephens at (800) 643-9691.
MIP's Registration Statement may be examined at the office of the Securities
and Exchange Commission ("SEC") in Washington, D.C.

ITEM 11. TABLE OF CONTENTS.

<TABLE>
<CAPTION>
Page
----
<S> <C>
General Information and History . . . . . . . . . . . . . . . . . . 2
Investment Objectives and Policies . . . . . . . . . . . . . . . . 2
Management of MIP . . . . . . . . . . . . . . . . . . . . . . . 7
Control Persons and Principal Holders of
Securities . . . . . . . . . . . . . . . . . . . . . . . . . 10
Investment Advisory and Other Services . . . . . . . . . . . . . . 10
Brokerage Allocation and Other Practices . . . . . . . . . . . . . 12
Capital Stock and Other Securities . . . . . . . . . . . . . . . . 13
Purchase, Redemption and Pricing of
Securities . . . . . . . . . . . . . . . . . . . . . . . . . 14
Tax Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Underwriters . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Calculations of Performance Data . . . . . . . . . . . . . . . . . 16
Financial Information . . . . . . . . . . . . . . . . . . . . . . . 16
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . F-1
</TABLE>

1
<PAGE> 97
ITEM 12. GENERAL INFORMATION AND HISTORY.

Not applicable.

ITEM 13. INVESTMENT OBJECTIVES AND POLICIES.

The following information supplements and should be read in
conjunction with Item 4 in Part A.

Investment Objectives. Master Investment Portfolio ("MIP") is an open-end,
management investment company known as a mutual fund. By this offering
document, MIP is offering two diversified portfolios - the Asset Allocation
Master Portfolio and U.S. Treasury Allocation Master Portfolio (each, a "Master
Portfolio" and together, the "Master Portfolios").

Each Master Portfolio's investment objective is set forth in Item
4, "General Description of Registrant -- Investment Objective," of Part A.
There can be no assurance that the investment objectives of each Master
Portfolio will be achieved. Each Master Portfolio's investment objective
cannot be changed without approval by the holders of a majority (as defined in
the Investment Company Act of 1940, as amended (the "1940 Act")) of such Master
Portfolio's outstanding voting shares.

BZW Barclays Global Fund Advisors ("BGFA") serves as investment
adviser to each Master Portfolio. Prior to January 1, 1996, Wells Fargo Bank,
N.A. ("Wells Fargo Bank") served as each Master Portfolio's investment adviser
and Wells Fargo Nikko Investment Advisors ("WFNIA") served as each Master
Portfolio's sub-investment adviser. BGFA was created by the reorganization of
WFNIA with and into an affiliate of Wells Fargo Institutional Trust Company
("WFITC). BGFA is now a subsidiary of WFITC which, effective January 1, 1996,
changed its name to BZW Barclays Global Investors, N.A. ("BGI"). Stephens Inc.
("Stephens") serves as placement agent of each Master Portfolio's shares.

Portfolio Securities.

Bank Obligations. Domestic commercial banks organized under
Federal law are supervised and examined by the Comptroller of the Currency and
are required to be members of the Federal Reserve System and to have their
deposits insured by the Federal Deposit Insurance Corporation (the "FDIC").
Domestic banks organized under state law are supervised and examined by state
banking authorities but are members of the Federal Reserve System only if they
elect to join. In addition, state banks whose certificates of deposit ("CDs")
may be purchased by each Master Portfolio are insured by the FDIC (although
such insurance may not be of material benefit to the Master Portfolio,
depending on the principal amount of the CDs of each bank held by the Master
Portfolio) and are subject to Federal examination and to a substantial body of
Federal law and regulation. As a result of Federal or state laws and
regulations, domestic branches of domestic banks whose CDs may be purchased by
each Master Portfolio generally are required, among other things, to maintain
specified levels of reserves, are limited in the amounts which they can loan to
a single borrower and are subject to other regulation designed to promote

2
<PAGE> 98
financial soundness. However, not all of such laws and regulations apply to
the foreign branches of domestic banks.

Obligations of foreign branches of domestic banks, foreign
subsidiaries of domestic banks and domestic and foreign branches of foreign
banks, such as CDs and time deposits ("TDs"), may be general obligations of the
parent banks in addition to the issuing branch, or may be limited by the terms
of a specific obligation and governmental regulation. Such obligations are
subject to different risks than are those of domestic banks. These risks
include foreign economic and political developments, foreign governmental
restrictions that may adversely affect payment of principal and interest on the
obligations, foreign exchange controls and foreign withholding and other taxes
on interest income. These foreign branches and subsidiaries are not
necessarily subject to the same or similar regulatory requirements that apply
to domestic banks, such as mandatory reserve requirements, loan limitations,
and accounting, auditing and financial record keeping requirements. In
addition, less information may be publicly available about a foreign branch of
a domestic bank or about a foreign bank than about a domestic bank.

Obligations of United States branches of foreign banks may be
general obligations of the parent bank in addition to the issuing branch, or
may be limited by the terms of a specific obligation or by Federal or state
regulation as well as governmental action in the country in which the foreign
bank has its head office. A domestic branch of a foreign bank with assets in
excess of $1 billion may be subject to reserve requirements imposed by the
Federal Reserve System or by the state in which the branch is located if the
branch is licensed in that state.

In addition, Federal branches licensed by the Comptroller of the
Currency and branches licensed by certain states ("State Branches") may be
required to: (1) pledge to the regulator, by depositing assets with a
designated bank within the state, a certain percentage of their assets as fixed
from time to time by the appropriate regulatory authority; and (2) maintain
assets within the state in an amount equal to a specified percentage of the
aggregate amount of liabilities of the foreign bank payable at or through all
of its agencies or branches within the state. The deposits of Federal and
State Branches generally must be insured by the FDIC if such branches take
deposits of less than $100,000.

Each Master Portfolio may purchase CDs issued by banks, savings
and loan associations and similar thrift institutions with less than $1 billion
in assets, which are members of the FDIC, provided such Master Portfolio
purchases any such CD in a principal amount of not more than $100,000, which
amount would be fully insured by the Bank Insurance Fund or the Savings
Association Insurance Fund administered by the FDIC. Interest payments on such
a CD are not insured by the FDIC. No Master Portfolio will own more than one
such CD per such issuer.

3
<PAGE> 99
Management Policies.

Futures Contracts and Options on Futures Contracts. The Master
Portfolio may enter into futures contracts and may purchase and write options
thereon. Upon exercise of an option on a futures contract, the writer of the
option delivers to the holder of the option the futures position and the
accumulated balance in the writer's futures margin account, which represents
the amount by which the market price of the futures contract exceeds, in the
case of a call, or is less than, in the case of a put, the exercise price of
the option on the futures contract. The potential loss related to the purchase
of options on futures contracts is limited to the premium paid for the option
(plus transaction costs). Because the value of the option is fixed at the time
of sale, there are no daily cash payments to reflect changes in the value of
the underlying contract; however, the value of the option does change daily and
that change would be reflected in the net asset value of the relevant Master
Portfolio.

Future Developments. Each Master Portfolio may take advantage of
opportunities in the area of options and futures contracts and options on
futures contracts and any other derivative investments which are not presently
contemplated for use by such Master Portfolio or which are not currently
available but which may be developed, to the extent such opportunities are both
consistent with a Master Portfolio's investment objective and legally
permissible for the Master Portfolio. Before entering into such transactions
or making any such investment, the Master Portfolio will provide appropriate
disclosure in its prospectus.

Lending Portfolio Securities. To a limited extent, each Master
Portfolio may lend its portfolio securities to brokers, dealers and other
financial institutions, provided it receives cash collateral which at all times
is maintained in an amount equal to at least 100% of the current market value
of the securities loaned. By lending its portfolio securities, a Master
Portfolio can increase its income through the investment of the cash
collateral. For purposes of this policy, each Master Portfolio considers
collateral consisting of U.S. Government securities or irrevocable letters of
credit issued by banks whose securities meet the standards for investment by
such Master Portfolio to be the equivalent of cash. From time to time, a
Master Portfolio may return to the borrower or a third party which is
unaffiliated with MIP, and which is acting as a "placing broker," a part of the
interest earned from the investment of collateral received for securities
loaned.

The SEC currently requires that the following conditions must be
met whenever portfolio securities are loaned: (1) the Master Portfolio must
receive at least 100% cash collateral from the borrower; (2) the borrower must
increase such collateral whenever the market value of the securities rises
above the level of such collateral; (3) the Master Portfolio must be able to
terminate the loan at any time; (4) the Master Portfolio must receive
reasonable interest on the loan, as well as any dividends, interest or other
distributions payable on the loaned securities, and any increase in market
value; (5) the Master Portfolio may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned securities
may pass to the borrower, MIP's Board of Trustees must terminate the loan and
regain the right to vote the securities if a material event adversely affecting
the investment occurs. These conditions may be subject to future modification.

4
<PAGE> 100
Investment Restrictions. Each Master Portfolio has adopted
investment restrictions numbered 1 through 10 as fundamental policies. These
restrictions cannot be changed, as to a Master Portfolio, without approval by
the holders of a majority (as defined in the 1940 Act) of such Master
Portfolio's outstanding voting securities. Investment restrictions numbered 11
through 17 are not fundamental policies and may be changed by vote of a
majority of the Trustees of MIP at any time. No Master Portfolio may:

2. Hold more than 10% of the outstanding voting securities of
any single issuer. This Investment Restriction applies only with respect to
75% of its total assets.

3. Invest in commodities, except that each Master Portfolio may
purchase and sell (i.e., write) options, forward contracts, futures contracts,
including those relating to indexes, and options on futures contracts or
indexes.

5. Borrow money, except to the extent permitted under the 1940
Act, provided that each Master Portfolio may borrow up to 20% of the current
value of its net assets for temporary purposes only in order to meet
redemptions, and these borrowings may be secured by the pledge of up to 20% of
the current value of its net assets (but investments may not be purchased while
any such outstanding borrowing in excess of 5% of its net assets exists). For
purposes of this investment restriction, a Master Portfolio's entry into
options, forward contracts, futures contracts, including those relating to
indexes, and options on futures contracts or indexes shall not constitute
borrowing to the extent certain segregated accounts are established and
maintained by the Master Portfolio.

7. Act as an underwriter of securities of other issuers, except
to the extent the Master Portfolio may be deemed an underwriter under the
Securities Act of 1933, as amended, by virtue of disposing of portfolio
securities.

5
<PAGE> 101
8. Invest 25% or more of its total assets in the securities of
issuers in any particular industry or group of closely related industries,
except that there shall be no limitation with respect to investments in (i)
obligations of the U.S. Government, its agencies or instrumentalities; (ii) in
the case of the stock portion of the Asset Allocation Master Portfolio, any
industry in which the S&P 500 Index becomes concentrated to the same degree
during the same period (provided that, with respect to the stock and money
market portions of the Asset Allocation Master Portfolio, the Master Portfolio
will be concentrated as specified above only to the extent the percentage of
its assets invested in those categories of investments is sufficiently large
that 25% or more of its total assets would be invested in a single industry);
and (iii) in the case of the money market portion of the Asset Allocation
Master Portfolio, its money market instruments may be concentrated in the
banking industry (but it will not do so unless the SEC staff confirms that it
does not object to the Master Portfolio reserving freedom of action to
concentrate investments in the banking industry).

9. Issue any senior security (as such term is defined in Section
18(f) of the 1940 Act), except to the extent the activities permitted in
Investment Restriction Nos. 3, 5, 12 and 13 may be deemed to give rise to a
senior security.

10. Purchase securities on margin, but each Master Portfolio may
make margin deposits in connection with transactions in options, forward
contracts, futures contracts, including those relating to indexes, and options
on futures contracts or indexes.

13. Purchase, sell or write puts, calls or combinations thereof,
except as may be described in the Master Portfolio's offering documents.

14. Purchase securities of any company having less than three
years' continuous operations (including operations of any predecessors) unless
the securities are fully guaranteed or insured by the U.S. Government, a state,
commonwealth, possession, territory, the District of Columbia or by an entity
in existence at least three years, or the securities are backed by the assets
and revenues of any of the foregoing, if such purchase would cause the value of
its investments in all such companies to exceed 5% of the value of its total
assets.

6
<PAGE> 102
16. Purchase securities of other investment companies, except to
the extent permitted under the 1940 Act.

17. Purchase or retain securities of any issuer if the officers
or Directors of the Company, the Trusts or the investment adviser owning
beneficially more than one-half of one percent (0.5%) of the securities of the
issuer together owned beneficially more than 5% of such securities.

ITEM 14. MANAGEMENT OF MIP.

The following information supplements and should be read in
conjunction with the Part A section entitled "Management of the Master
Portfolio." The Trustees and Principal Officer of MIP, together with
information as to their principal business occupations during at least the last
five years, are shown below. The address of each, unless otherwise indicated,
is 111 Center Street, Little Rock, Arkansas 72201. Each Trustee who is deemed
to be an "interested person" of MIP, as defined in the 1940 Act, is indicated
by an asterisk.

*R. Greg Feltus, 45 Trustee, Senior Vice President
Chairman and of Stephens; Manager
President of Financial Services
Group; President of Stephens
Insurance Services Inc.; Senior
Vice President of Stephens Sports Management Inc.; and
President of Investors Brokerage Insurance Inc.
</TABLE>

7
<PAGE> 103
<TABLE>
<CAPTION>
Principal Occupations
Name, Address and Age Position During Past 5 Years
- --------------------- -------- ---------------------
<S> <C> <C>
Thomas S. Goho, 54 Trustee T.B. Rose Faculty Fellow-Business,
321 Beechcliff Court Wake Forest University, Calloway
Winston-Salem, NC 27104 School of Business and Accounting;
Associate Professor of Finance of the School of Business
and Accounting at Wake Forest University since 1983.

*Zoe Ann Hines, 47 Trustee Senior Vice President of Stephens and
Director of Brokerage Accounting; and Secretary of
Stephens Resource Management.

*W. Rodney Hughes, 70 Trustee Private Investor.
31 Dellwood Court
San Rafael, CA 94901

Robert M. Joses, 78 Trustee Private Investor.
47 Dowitcher Way
San Rafael, CA 94901

*J. Tucker Morse, 52 Trustee Private Investor; Real Estate Developer;
10 Legrae Street Chairman of Renaissance Properties Ltd.;
Charleston, SC 29401 President of Morse Investment Corporation; and Co-Managing
Partner of Main Street Ventures.

Richard H. Blank, Jr., 40 Chief Associate of Financial Services Group of
Operating Stephens; Director of Stephens Sports
Officer, Management Inc.; and Director of
Secretary and Capo Inc.
Treasurer
</TABLE>

8
<PAGE> 104
COMPENSATION TABLE
For the Fiscal Year Ended February 29, 1996

*R. Greg Feltus 0 0
Trustee

Thomas S. Goho 0 39,000
Trustee

*Zoe Ann Hines 0 0
Trustee

*W. Rodney Hughes 0 36,250
Trustee

Robert M. Joses 0 38,250
Trustee

*J. Tucker Morse 0 33,000
Trustee
</TABLE>

Trustees of MIP are compensated annually by MIP and by all the
registrants in the fund complex for their services as indicated above and also
are reimbursed for all out-of-pocket expenses relating to attendance at board
meetings. Each of the Trustees and the Principal Officer of MIP serves in the
identical capacity as Directors/Trustees and/or Principal Officer of
MasterWorks Funds Inc. ("MasterWorks" formerly, Stagecoach Inc.), Managed
Series Investment Trust ("MSIT"), Stagecoach Funds, Inc., Overland Express
Funds, Inc., Life & Annuity Trust and Master Investment Trust, each of which is
a registered open-end management investment company and each of which, prior to
January 1, 1996 and the reorganization of WFNIA, was considered to be in the
same "fund complex," as such term is defined in Form N-1A under the 1940 Act,
as MIP. Effective January 1, 1996, MIP, MasterWorks and MSIT are considered to
be members of the same fund complex and are no longer part of the same fund
complex as Stagecoach Funds, Inc., Overland Express Funds, Inc., Stagecoach
Trust, Life & Annuity Trust and Master Investment Trust. The Trustees are
compensated by other Companies and Trusts within the fund complex for their
services as Directors/Trustees to such Companies and Trusts. Currently the
Trustees do not receive any retirement benefits or deferred compensation from
MIP or any other member of the fund complex.

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<PAGE> 105
As of the date of this SAI, the Trustees and Principal Officer of
MIP as a group beneficially owned less than 1% of the outstanding shares of MIP.

ITEM 15. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.

As of June 1, 1996, the Asset Allocation Fund and U.S. Treasury
Allocation Fund of MasterWorks Funds Inc., 111 Center Street, Little Rock,
Arkansas 72201, owned approximately 99% of the outstanding voting securities of
the Asset Allocation Master Portfolio and approximately 99% of the outstanding
voting securities of the U.S. Treasury Allocation Master Portfolio,
respectively, and each Fund could be considered a "controlling person" of the
corresponding Master Portfolio for purposes of the 1940 Act.

ITEM 16. INVESTMENT ADVISORY AND OTHER SERVICES.

The following information supplements and should be read in
conjunction with Item 5 in Part A.

Investment Adviser. BGFA provides investment advisory services to
each Master Portfolio pursuant to separate Investment Advisory Agreements
(each, a "BGFA Advisory Agreement") dated January 1, 1996 with MIP. As to each
Master Portfolio, the applicable BGFA Advisory Agreement is subject to annual
approval by (i) MIP's Board of Trustees or (ii) vote of a majority (as defined
in the 1940 Act) of the outstanding voting securities of such Master Portfolio,
provided that in either event the continuance also is approved by a majority of
MIP's Board of Trustees who are not "interested persons" (as defined in the
1940 Act) of MIP or BGFA, by vote cast in person at a meeting called for the
purpose of voting on such approval. As to each Master Portfolio, the
applicable BGFA Advisory Agreement is terminable without penalty, on 60 days'
written notice, by either party. The applicable BGFA Advisory Agreements will
terminate automatically, as to the relevant Master Portfolio, in the event of
its assignment (as defined in the 1940 Act).
Prior to January 1, 1996, Wells Fargo Bank provided investment
advisory services to each Master Portfolio pursuant to an Investment Advisory
Agreement (the "Advisory Agreement") dated February 25, 1994 with MIP. The
terms of the Advisory Agreement were identical in all material respects, other
than the identity of the parties, to each BGFA Advisory Agreement.

Advisory Fees Paid. For the period beginning May 26, 1994
(commencement of operations) and ended February 28, 1995 and the period
beginning March 1, 1995 and ended December 31, 1995, the Master Portfolios paid
to Wells Fargo Bank the following advisory fees, and Wells Fargo Bank waived
the indicated amounts. For the period beginning January 1, 1996 and ended
February 29, 1996, the Master Portfolios paid to BGFA the following advisory
fees, and BGFA waived the indicated amounts:

10
<PAGE> 106
<TABLE>
<CAPTION>
5/26/94- 3/1/95- 1/1/96-
2/28/95 12/31/95 2/29/96
Fees Fees Fees
Fees Paid Waived Fees Paid Waived Fees Paid Waived
--------- ------ --------- ------ --------- ------
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Master $666,053 $0 $997,003 $0 $225,669 $0
Portfolio
U.S. Treasury Allocation $128,994 $0 $152,657 $0 $ 25,863 $0
Master Portfolio
</TABLE>

Sub-Investment Adviser. The Master Portfolios do not currently
engage a Sub-adviser. However, prior to January 1, 1996, WFNIA provided
sub-investment advisory services to each Master Portfolio pursuant to a
Sub-Investment Advisory Agreement (the "Sub-Advisory Agreement") dated February
28, 1994 with Wells Fargo Bank and MIP.

Sub-Advisory Fees Paid. For the period beginning May 26, 1994
(commencement of operations) and ended February 28, 1995 and the period
beginning March 1, 1995 and ended December 31, 1995, Wells Fargo Bank paid the
following sub-advisory fees to WFNIA for services provided on behalf of each
Master Portfolio, and WFNIA waived the indicated amounts:

<TABLE>
<CAPTION>
5/26/94- 3/1/95-
2/28/95 12/31/95
Fees Fees
Fees Paid Waived Fees Paid Waived
--------- ------ --------- ------
<S> <C> <C> <C> <C>
Asset Allocation Master Portfolio $375,907 $0 $567,009 $0
U.S. Treasury Allocation Master Portfolio $ 64,439 $0 $ 75,895 $0
</TABLE>

Administrator. Stephens provides administrative services to MIP
pursuant to an Administration Agreement dated February 25, 1994 (the
"Administration Agreement"). Under the Administration Agreement, Stephens
provides as administrative services, among other things: (i) general
supervision of the operation of MIP and the Master Portfolios, including
coordination of the services performed by the investment adviser, transfer and
dividend disbursing agent, custodian, interestholder servicing agent(s),
independent auditors and legal counsel; (ii) general supervision of regulatory
compliance matters, including the compilation of information for documents such
as reports to, and filings with, the SEC and state securities commissions, and
preparation of proxy statements and interestholder reports for the Master
Portfolios; and (iii) general supervision relative to the compilation of data
required for the preparation of periodic reports distributed to MIP's officers
and Board of Trustees. Stephens also furnishes office space and certain
facilities required for conducting the business of MIP together with those
ordinary clerical and bookkeeping services that are not being furnished by the
Master Portfolios' investment adviser. Stephens also pays the compensation of
MIP's Trustees, officers and employees who are affiliated with Stephens.

Stephens is not entitled to compensation for providing
administrative services to a Master Portfolio so long as Stephens receives fees
for providing similar services to a fund of

11
<PAGE> 107
another investment company which invests all of its assets in such Master
Portfolio. For the period from commencement of operations to February 28, 1995
and for the fiscal year ended February 29, 1996, the Master Portfolios did not
pay any administrative fees to Stephens.

Custodian, Transfer and Dividend Disbursing Agent. BZW Barclays
Global Investors, N.A., ("BGI"), a wholly- owned subsidiary of BZW Barclays
Global Investors Holdings Inc., acts as custodian to MIP. The custodian, among
other things, maintains a custody account or accounts in the name of MIP;
receives and delivers all assets for MIP upon purchase and upon sale or
maturity; collects and receives all income and other payments and distributions
on account of the assets of MIP and pays all expenses of MIP. For the fiscal
year ended February 29, 1996, the Master Portfolio did not pay any custody
fees. Wells Fargo Bank acts as MIP's transfer and dividend disbursing agent
and performs such services at 525 Market Street, San Francisco, California,
94105. Wells Fargo Bank is not entitled to receive compensation for providing
such services to MIP so long as it receives fees for providing similar services
to the funds which invest substantially all of their assets in the Master
Portfolios. For the fiscal year ended February 29, 1996, the Master Portfolios
did not pay any transfer and dividend disbursing agency fees.

ITEM 17. BROKERAGE ALLOCATION AND OTHER PRACTICES.

General. BGFA assumes general supervision over placing orders on
behalf of each Master Portfolio for the purchase or sale of portfolio
securities. Allocation of brokerage transactions, including their frequency,
is made in the best judgment of BGFA and in a manner deemed fair and reasonable
to shareholders. In executing portfolio transactions and selecting brokers or
dealers, BGFA seeks to obtain the best overall terms available for each Master
Portfolio. In assessing the best overall terms available for any transaction,
BGFA considers factors deemed relevant, including the breadth of the market in
the security, the price of the security, the financial condition and execution
capability of the broker or dealer, and the reasonableness of the commission,
if any, both for the specific transaction and on a continuing basis. The
primary consideration is prompt execution of orders at the most favorable net
price. Certain of the brokers or dealers with whom the Master Portfolios may
transact business offer commission rebates to the Master Portfolios. BGFA
considers such rebates in assessing the best overall terms available for any
transaction. The overall reasonableness of brokerage commissions paid is
evaluated by BGFA based upon its knowledge of available information as to the
general level of commission paid by other institutional investors for comparable
services. Prior to January 1, 1996, WFNIA exercised general supervision over
placing orders on behalf of each Master Portfolio for the purchase or sale of
portfolio securities and the brokerage allocation practices described herein
are applicable to WFNIA and the Master Portfolios prior to January 1, 1996.

Asset Allocation Master Portfolio. Brokers also are selected
because of their ability to handle special executions such as are involved in
large block trades or broad distributions, provided the primary consideration
is met. Portfolio turnover may vary from year to year, as well as within a
year. High turnover rates over 100% are likely to result in comparatively
greater brokerage expenses.

U.S. Treasury Allocation Master Portfolio. Purchases and sales of
portfolio securities for the U.S. Treasury Allocation Master Portfolio usually
are principal transactions. Portfolio securities ordinarily are purchased
directly from the issuer or from an underwriter or market maker. Usually no
brokerage commissions are paid by the U.S. Treasury Allocation Master
Portfolio for such purchases and sales. The prices paid to the underwriters of
newly-issued securities usually include a concession paid by the issuer to the
underwriter, and purchases of securities from market makers may include the
spread between the bid and asked price.

12
<PAGE> 108
Brokerage Commissions. For the period from commencement of
operations until February 28, 1995 and for the year ended February 29, 1996 the
Master Portfolios paid brokerage commissions in the dollar amounts shown below.
None of the brokerage commissions were paid to affiliated brokers.

<TABLE>
<CAPTION>
Master Portfolio 1995 1996
- ---------------- ---- ----
<S> <C> <C>
Asset Allocation Master Portfolio $14,321 $9,782
U.S. Treasury Allocation Master Portfolio $ 0 $ 0
</TABLE>

Securities of Regular Broker/Dealers. On February 29, 1996, the
Master Portfolios owned securities of their "regular brokers or dealers" or
their parents, as defined in the 1940 Act, as follows:

<TABLE>
<CAPTION>
Master Portfolio Regular Broker/Dealer Amount
- ---------------- --------------------- ------
<S> <C> <C>
Asset Allocation Master Portfolio Merrill Lynch & Co. $501,000
J.P. Morgan Securities $760,000
Group.
</TABLE>

ITEM 18. CAPITAL STOCK AND OTHER SECURITIES.

Pursuant to MIP's Declaration of Trust, the Trustees are
authorized to issue shares of beneficial interests in each Master Portfolio.
Investors in a Master Portfolio are entitled to participate pro rata in
distributions of taxable income, loss, gain and credit of such Master
Portfolio. Upon liquidation or dissolution of a Master Portfolio, investors
are entitled to share pro rata in such Master Portfolio's net assets available
for distribution to its investors. Investments in a Master Portfolio have no
preference, pre-exemptive, conversion or similar rights and are fully paid and
non-assessable, except as set forth below. Investments in the Master Portfolio
may not be transferred. No certificates are issued.

Each investor is entitled to vote, with respect to matters
affecting each of MIP's series, in proportion to the amount of its investment
in MIP. Investors in MIP do not have cumulative voting rights, and investors
holding more than 50% of the aggregate beneficial interest in MIP may elect all
of the Trustees of MIP if they choose to do so and in such event the other
investors in MIP would not be able to elect any Trustee. MIP is not required
to hold annual meetings of investors but MIP may hold special meetings of
investors when in the judgment of MIP's Trustees it is necessary or desirable
to submit matters for an investor vote.

13
<PAGE> 109
Master Portfolio in the matter are identical or that the matter does not affect
any interest of such Master Portfolio. However, the Rule exempts the selection
of independent accountants and the election of Trustees from the separate
voting requirements of the Rule.

ITEM 19. PURCHASE, REDEMPTION AND PRICING OF SECURITIES.

The following information supplements and should be read in
conjunction with Items 7 and 8 in Part A.

Purchase of Securities. Beneficial interests in each Master
Portfolio are issued solely in private placement transactions which do not
involve any "public offering" within the meaning of Section 4(2) of the
Securities Act of 1933, as amended (the "1933 Act"). Investments in the Master
Portfolio may only be made by investment companies or certain other entities
which are "accredited investors" within the meaning of Regulation D under the
1933 Act. This registration statement does not constitute an offer to sell, or
the solicitation of an offer to buy, any "security" within the meaning of the
1933 Act.

Suspension of Redemptions. The right of redemption of Master
Portfolio shares may be suspended or the date of payment postponed (a) during
any period when the New York Stock Exchange is closed (other than customary
weekend and holiday closings), (b) when trading in the markets the Master
Portfolio ordinarily utilizes is restricted, or when an emergency exists as
determined by the Securities and Exchange Commission so that disposal of the
Master Portfolio's investments or determination of its net asset value is not
reasonably practicable, or (c) for such other periods as the Securities and
Exchange Commission by order may permit to protect the Master Portfolio's
shareholders.

Pricing of Securities.

Asset Allocation Master Portfolio. The securities of the Asset
Allocation Master Portfolio, including covered call options written by the
Master Portfolio, are valued as discussed below. Domestic securities are
valued at the last sale price on the domestic securities or commodities
exchange or national securities market on which such securities primarily are
traded. Securities not listed on a domestic exchange or national securities
market, or securities in which there were no transactions, are valued at the
most recent bid prices. Short-term investments are carried at amortized cost,
which approximates value. Any securities or other assets for which recent
market quotations are not readily available are valued at fair value as
determined in good faith by BGFA pursuant to guidelines approved by MIP's Board
of Trustees. Expenses and fees, including advisory fees, are accrued daily and
taken into account for the purpose of determining the net asset value of the
Master Portfolio's shares.

Restricted securities, as well as securities or other assets for
which market quotations are not readily available, or are not valued by a
pricing service approved by MIP's Board of Trustees, are valued at fair value
as determined in good faith by BGFA in accordance with guidelines approved by
MIP's Board of Trustees. BGFA and MIP's Board of Trustees periodically review
the method of valuation. In making its good faith valuation of restricted

14
<PAGE> 110
securities, BGFA generally takes the following factors into consideration:
restricted securities which are, or are convertible into, securities of the
same class of securities for which a public market exists usually are valued at
market value less the same percentage discount at which purchased. This
discount is revised periodically if it is believed that the discount no longer
reflects the value of the restricted securities. Restricted securities not of
the same class as securities for which a public market exists usually will be
valued initially at cost. Any subsequent adjustments from cost are made in
accordance with guidelines approved by MIP's Board of Trustees.

U.S. Treasury Allocation Master Portfolio. The investments of the
U.S. Treasury Allocation Master Portfolio are valued each business day using
available market quotations or at fair value as determined by one or more
independent pricing services (collectively, the "Services") approved by MIP's
Board of Trustees. The Services may use available market quotations, employ
electronic data processing techniques and/or a matrix system to determine
valuations. Each Service's procedures are reviewed by MIP's officers in
accordance with guidelines approved by MIP's Board of Trustees. Expenses and
fees, including advisory fees, are accrued daily and are taken into account for
the purpose of determining the net asset value of the Master Portfolio's
shares.

ITEM 20. TAX STATUS.

MIP is organized as a business trust under Delaware law. Under
MIP's classification for federal income tax purposes, each Master Portfolio
will be treated as a partnership and, therefore, will not be subject to any
federal income tax. However, each investor in a Master Portfolio will be
taxable on its share (as determined in accordance with the governing
instruments of MIP) of such Master Portfolio's ordinary income and capital gain
in determining its federal income tax liability. The determination of such
share will be made in accordance with the Internal Revenue Code of 1986, as
amended (the "Code"), and regulations promulgated thereunder.

MIP's taxable year-end is the last day of February. Although MIP
will not be subject to Federal income tax, it will file appropriate Federal
income tax returns.

Each Master Portfolio's assets, income and distributions will be
managed in such a way that an investor in such Master Portfolio may satisfy the
requirements of Subchapter M of the Code, by investing substantially all of its
investable assets in the Master Portfolio. Investors are advised to consult
their own tax advisors as to the tax consequences of an investment in a Master
Portfolio.

15
<PAGE> 111
ITEM 21. UNDERWRITERS.

The exclusive placement agent for MIP is Stephens, which receives
no compensation for serving in this capacity. Registered broker/dealers and
investment companies, insurance company separate accounts, common and
commingled trust funds, group trust and similar organizations and entities
which constitute accredited investors as defined in the regulations adopted
under the 1933 Act, may continuously invest in a Master Portfolio of MIP.

ITEM 22. CALCULATIONS OF PERFORMANCE DATA.

Not applicable.

ITEM 23. FINANCIAL INFORMATION.

KPMG Peat Marwick LLP provides audit services, tax return
preparation and assistance and consultation in connection with the review of
certain SEC filings. KPMG Peat Marwick LLP's address is Three Embarcadero
Center, San Francisco, California 94111. For the fiscal year ended February
28, 1995, MIP's financial statements were audited by other independent
auditors. Such auditors expressed an unqualified opinion on the financial
statements of MIP.

The portfolio of investments, audited financial statements and
independent auditors report for the Master Portfolios for the fiscal year ended
February 29, 1996 are hereby incorporated by reference to the MasterWorks Funds
Inc. Annual Report, as filed with the SEC on May 28, 1996. The portfolio of
investments, audited financial statements and independent auditors report for
the Master Portfolios are attached to all Part Bs delivered to interestholders
or prospective interestholders.

16
<PAGE> 112
APPENDIX

S&P

Bond Ratings

AAA

Bonds rated "AAA" have the highest rating assigned by S&P.
Capacity to pay interest and repay principal is extremely strong.

Bonds rated "AA" have a very strong capacity to pay interest and
repay principal and differ from the highest rated issues only in small degree.

BBB

S&P's letter ratings may be modified by the addition of a plus (+)
or minus (-) sign designation, which is used to show relative standing within
the major rating categories, except in the AAA (Prime Grade) category.

Commercial Paper Rating

The designation "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 with a
plus sign (+) designation. Capacity for timely payment on issues with an "A-2"
designation is strong. However, the relative degree of safety is not as high
as for issues designated "A-1".

A-1
<PAGE> 113
Moody's

Bond Ratings

Aaa

Bonds which are rated "Aaa" are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally referred to
as "gilt edge." 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 which are rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group they comprise what generally are
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.

Baa

A-2
<PAGE> 114
Commercial Paper Rating

The rating "Prime-1 (P-1)" is the highest commercial paper rating
assigned by Moody's. Issuers of "P-1" paper must have a superior capacity for
repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures with
moderate reliance on debt and ample asset protection, broad margins in earnings
coverage of fixed financial charges and high internal cash generation, and well
established access to a range of financial markets and assured sources of
alternate liquidity.

Issuers (or relating supporting institutions) rated "Prime-2
(P-2)" have a strong capacity for repayment of short-term promissory
obligations. This ordinarily will be evidenced by many of the characteristics
cited above but to a lesser degree. Earnings trends and coverage ratios, while
sound, will be more subject to variation. Capitalization characteristics,
while still appropriate, may be more affected by external conditions. Ample
alternate liquidity is maintained.

Fitch

Bond Ratings

The ratings represent Fitch's assessment of the issuer's ability
to meet the obligations of a specific debt issue or class of debt. The ratings
take into consideration special features of the issue, its relationship to
other obligations of the issuer, the current financial condition and operative
performance of the issuer and of any guarantor, as well as the political and
economic environment that might affect the issuer's future financial strength
and credit quality.

AAA

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 issuers is
generally rated "F-1+".

A-3
<PAGE> 115
A

Bonds rated "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.

BBB

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 an adverse impact on these
bonds and, therefore, impair timely payment. The likelihood that the ratings
of these bonds will fall below investment grade is higher than for bonds with
higher ratings.

Plus (+) and minus (-) signs are used with a rating symbol to
indicate the relative position of a credit within the rating category.

Short-Term Ratings

F-1+

Exceptionally Strong Credit Quality. Issues assigned this rating
are regarded as having the strongest degree of assurance for timely payment.

F-1

Very Strong Credit Quality. Issues assigned this rating reflect
an assurance of timely payment only slightly less in degree than issues rated
F-1+.

F-2

Good Credit Quality. Issues carrying this rating have a
satisfactory degree of assurance for timely payments, but the margin of safety
is not as great as the F-1+ and F-1 categories.

A-4
<PAGE> 116
Duff

Bond Ratings

AAA

Bonds rated "AAA" are considered highest credit quality. The risk
factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.

Bonds rated "AA" are considered high credit quality. Protection
factors are strong. Risk is modest but may vary slightly from time to time
because of economic conditions.

Bonds rated "A" have protection factors which are average but
adequate. However, risk factors are more variable and greater in periods of
economic stress.

BBB

Bonds rated "BBB" are considered to have below average protection
factors but still considered sufficient for prudent investment. Considerable
variability in risk during economic cycles.

Plus (+) and minus (-) signs are used with a rating symbol (except
"AAA") to indicate the relative position of a credit within the rating
category.

Commercial Paper Rating

IBCA

Bond and Long-Term Ratings

A-5
<PAGE> 117
Obligations for which there is a very low expectation of investment risk are
rated "AA" by IBCA. 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.

Commercial Paper and Short-Term Ratings

International and U.S. Bank Ratings

An IBCA bank rating represents IBCA's current assessment of the
strength of the bank and whether such bank would receive support should it
experience difficulties. In its assessment of a bank, IBCA uses a dual rating
system comprised of Legal Ratings and Individual Ratings. In addition, IBCA
assigns banks Long- and Short-Term Ratings as used in the corporate ratings
discussed above. Legal Ratings, which range in gradation from 1 through 5,
address the question of whether the bank would receive support provided by
central banks or shareholders if it experienced difficulties, and such ratings
are considered by IBCA to be a prime factor in its assessment of credit risk.
Individual Ratings, which range in gradations from A through E, represent
IBCA's assessment of a bank's economic merits and address the question of how
the bank would be viewed if it were entirely independent and could not rely on
support from state authorities or its owners.

A-6
<PAGE> 118
MASTER INVESTMENT PORTFOLIO
INDEX MASTER PORTFOLIOS

S&P 500 INDEX MASTER PORTFOLIO
BOND INDEX MASTER PORTFOLIO

PART B -- STATEMENT OF ADDITIONAL INFORMATION
June 28, 1996

ITEM 10. COVER PAGE.

Master Investment Portfolio ("MIP") is an open-end, management
investment company. MIP is a "series fund," which is a mutual fund divided
into separate portfolios. This Part B is not a prospectus and should be read
in conjunction with MIP's Part A, also dated June 28, 1996. All terms used in
this Part B that are defined in Part A have the meanings assigned in Part A. A
copy of Part A may be obtained without charge by writing Stephens Inc.
("Stephens"), MIP's sponsor, administrator and placement agent, at 111 Center
Street, Little Rock, Arkansas 72201, or by calling Stephens at (800) 643-9691.
MIP's Registration Statement may be examined at the office of the Securities
and Exchange Commission ("SEC") in Washington, D.C.

ITEM 11. TABLE OF CONTENTS.
<TABLE>
<CAPTION>
Page
----
<S> <C>
General Information and History . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Investment Objectives and Policies . . . . . . . . . . . . . . . . . . . . . . . . . 2
Management of MIP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Control Persons and Principal Holders of Securities . . . . . . . . . . . . . . . . . 10
Investment Advisory and Other Services . . . . . . . . . . . . . . . . . . . . . . . 10
Brokerage Allocation and Other Practices . . . . . . . . . . . . . . . . . . . . . . 12
Capital Stock and Other Securities . . . . . . . . . . . . . . . . . . . . . . . . . 13
Purchase, Redemption and Pricing of Securities . . . . . . . . . . . . . . . . . . . 14
Tax Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Underwriters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Calculations of Performance Data . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1
</TABLE>

1
<PAGE> 119
ITEM 12. GENERAL INFORMATION AND HISTORY.

Not applicable.

ITEM 13. INVESTMENT OBJECTIVES AND POLICIES.

The following information supplements and should be read in
conjunction with Item 4 in Part A.

Investment Objectives. Master Investment Portfolio ("MIP") is an open-end,
management investment company known as a mutual fund. By this offering
document, MIP is offering two diversified portfolios, the Bond Index Master
Portfolio and S&P 500 Index Master Portfolio (each, a "Master Portfolio" and
together, the "Master Portfolios").

Each Master Portfolio's investment objective is set forth in Item
4, "General Description of Registrant -- Investment Objective," of Part A.
There can be no assurance that the investment objectives of each Master
Portfolios will be achieved. Each Master Portfolios' investment objective
cannot be changed without approval by the holders of a majority (as defined in
the Investment Company Act of 1940, as amended (the "1940 Act")) of such Master
Portfolios' outstanding voting shares.

BZW Barclays Global Fund Advisors ("BGFA") serves as investment
adviser to each Master Portfolio. Prior to January 1, 1996, Wells Fargo Bank,
N.A. ("Wells Fargo Bank") served as each Master Portfolio's investment adviser
and Wells Fargo Nikko Investment Advisors ("WFNIA") served as each Master
Portfolio's sub-investment adviser. BGFA was created by the reorganization of
WFNIA with and into an affiliate of Wells Fargo Institutional Trust Company
("WFITC"). BGFA is now a subsidiary of WFITC which, effective January 1, 1996,
changed its name to BZW Barclays Global Investors, N.A. ("BGI"). Stephens Inc.
("Stephens") serves as placement agent of each Master Portfolio's shares.

Portfolio Securities.

2
<PAGE> 120
financial soundness. However, not all of such laws and regulations apply to
the foreign branches of domestic banks.

Obligations of foreign branches of domestic banks, foreign
subsidiaries of domestic banks and domestic and foreign branches of foreign
banks, such as CDs and time deposits ("TDs"), may be general obligations of the
parent banks in addition to the issuing branch, or may be limited by the terms
of a specific obligation and governmental regulation. Such obligations are
subject to different risks than are those of domestic banks. These risks
include foreign economic and political developments, foreign governmental
restrictions that may adversely affect payment of principal and interest on the
obligations, foreign exchange controls and foreign withholding and other taxes
on interest income. These foreign branches and subsidiaries are not
necessarily subject to the same or similar regulatory requirements that apply
to domestic banks, such as mandatory reserve requirements, loan limitations,
and accounting, auditing and financial record keeping requirements. In
addition, less information may be publicly available about a foreign branch of
a domestic bank or about a foreign bank than about a domestic bank.

3
<PAGE> 121
Management Policies.

Futures Contracts and Options on Futures Contracts. Each Master
Portfolio may enter into futures contracts and may purchase and write options
thereon. Upon exercise of an option on a futures contract, the writer of the
option delivers to the holder of the option the futures position and the
accumulated balance in the writer's futures margin account, which represents
the amount by which the market price of the futures contract exceeds, in the
case of a call, or is less than, in the case of a put, the exercise price of
the option on the futures contract. The potential loss related to the purchase
of options on futures contracts is limited to the premium paid for the option
(plus transaction costs). Because the value of the option is fixed at the time
of sale, there are no daily cash payments to reflect changes in the value of
the underlying contract; however, the value of the option does change daily and
that change would be reflected in the net asset value of the relevant Master
Portfolio.

Future Developments. Each Master Portfolio may take advantage of
opportunities in the area of options and futures contracts and options on
futures contracts and any other derivative investments which are not presently
contemplated for use by such Master Portfolio or which are not currently
available but which may be developed, to the extent such opportunities are both
consistent with a Master Portfolio's investment objective and legally
permissible for the Master Portfolio. Before entering into such transactions
or making any such investment, each Master Portfolio will provide appropriate
disclosure in its prospectus.

Lending Portfolio Securities. To a limited extent, each Master
Portfolio may lend its portfolio securities to brokers, dealers and other
financial institutions, provided it receives cash collateral which at all times
is maintained in an amount equal to at least 100% of the current market value
of the securities loaned. By lending its portfolio securities, a Master
Portfolio can increase its income through the investment of the cash
collateral. For purposes of this policy, each Master Portfolio considers
collateral consisting of U.S. Government securities or irrevocable letters of
credit issued by banks whose securities meet the standards for investment by
such Master Portfolio to be the equivalent of cash. From time to time, a
Master Portfolio may return to the borrower or a third party which is
unaffiliated with the MIP, and which is acting as a "placing broker," a part of
the interest earned from the investment of collateral received for securities
loaned.

The SEC currently requires that the following conditions must be
met whenever portfolio securities are loaned: (1) the Master Portfolio must
receive at least 100% cash collateral from the borrower; (2) the borrower must
increase such collateral whenever the market value of the securities rises
above the level of such collateral; (3) the Master Portfolio must be able to
terminate the loan at any time; (4) the Master Portfolio must receive
reasonable interest on the loan, as well as any dividends, interest or other
distributions payable on the loaned securities, and any increase in market
value; (5) the Master Portfolio may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned securities
may pass to the borrower, MIP's Board of Trustees must terminate the loan and
regain the right to vote the securities if a material event adversely affecting
the investment occurs. These conditions may be subject to future modification.

4
<PAGE> 122
Investment Restrictions. Each Master Portfolio has adopted
investment restrictions numbered 1 through 10 as fundamental policies. These
restrictions cannot be changed, as to a Master Portfolio, without approval by
the holders of a majority (as defined in the 1940 Act) of such Master
Portfolios' outstanding voting securities. Investment restrictions numbered 11
through 17 are not fundamental policies and may be changed by vote of a
majority of the Trustees of MIP at any time. No Master Portfolio may:

2. Hold more than 10% of the outstanding voting securities of
any single issuer. This Investment Restriction applies only with respect to
75% of its total assets.

5. Borrow money, except to the extent permitted under the 1940
Act, provided that the Bond Index Master Portfolio may borrow from banks up to
10% of the current value of its net assets for temporary purposes only in order
to meet redemptions, and these borrowings may be secured by the pledge of up to
10% of the current value of its net assets (but investments may not be
purchased while any such outstanding borrowing in excess of 5% of its net
assets exists), and except that the S&P 500 Stock Master Portfolio may borrow
up to 20% of the current value of its net assets for temporary purposes only in
order to meet redemptions, and these borrowings may be secured by the pledge of
up to 20% of the current value of its net assets (but investments may not be
purchased while any such outstanding borrowing in excess of 5% of its net
assets exists). For purposes of this investment restriction, a Master
Portfolio's entry into options, forward contracts, futures contracts, including
those relating to indexes, and options on futures contracts or indexes shall
not constitute borrowing to the extent certain segregated accounts are
established and maintained by the Master Portfolio.

5
<PAGE> 123
7. Act as an underwriter of securities of other issuers,
except to the extent the Master Portfolio may be deemed an underwriter under
the Securities Act of 1933, as amended, by virtue of disposing of portfolio
securities.

8. Invest 25% or more of its total assets in the securities of
issuers in any particular industry or group of closely related industries and
except that, in the case of each Master Portfolio, there shall be no limitation
with respect to investments in (i) obligations of the U.S. Government, its
agencies or instrumentalities; (ii) in the case of the S&P 500 Stock Master
Portfolio, any industry in which the S&P 500 Index becomes concentrated to the
same degree during the same period, the Master Portfolio will be concentrated
as specified above only to the extent the percentage of its assets invested in
those categories of investments is sufficiently large that 25% or more of its
total assets would be invested in a single industry); (iii) in the case of the
Bond Index Master Portfolio, any industry in which the Lehman Brothers
Government/Corporate Bond Index (the "LB Bond Index") becomes concentrated to
the same degree during the same period.

10. Purchase securities on margin, but each Master Portfolio
may make margin deposits in connection with transactions in options, forward
contracts, futures contracts, including those related to indexes, and options
on futures contracts or indexes.

13. Purchase, sell or write puts, calls or combinations
thereof, except as may be described in the Master Portfolio's offering
documents.

6
<PAGE> 124
15. Enter into repurchase agreements providing for settlement
in more than seven days after notice or purchase securities which are illiquid,
if, in the aggregate, more than 15% of the value of each Master Portfolio's net
assets would be so invested.

16. Purchase securities of other investment companies, except
to the extent permitted under the 1940 Act.

17. Purchase or retain securities of any issuer if the officers
or Trustees of the Company, the Trusts or the investment adviser owning
beneficially more than one-half of one percent (0.5%) of the securities of the
issuer together owned beneficially more than 5% of such securities.

ITEM 14. MANAGEMENT OF MIP.

The following information supplements and should be read in
conjunction with the Part A section entitled "Management of the Master
Portfolio." The Trustees and Principal Officer of MIP, together with
information as to their principal business occupations during at least the last
five years, are shown below. The address of each, unless otherwise indicated,
is 111 Center Street, Little Rock, Arkansas 72201. Each Trustee who is deemed
to be an "interested person" of the MIP, as defined in the 1940 Act, is
indicated by an asterisk.

<TABLE>
<CAPTION>
Principal Occupations
Name, Address and Age Position During Past 5 Years
- --------------------- -------- -----------------------
<S> <C> <C>
Jack S. Euphrat, 74 Trustee Private investor
415 Walsh Road
Atherton, CA 94027

*R. Greg Feltus, 45 Chairman, Senior Vice President of Stephens;
President Manager of Financial Services Group;
and Trustee President of Stephens Insurance Services
Inc.; Senior Vice President of Stephens
Sports Management Inc.; and President of
Investors Brokerage Insurance Inc.
</TABLE>

7
<PAGE> 125
<TABLE>
<S> <C> <C>
Thomas S. Goho, 54 Trustee T.B. Rose Faculty Fellow-Business, Wake
321 Beechcliff Court Forest University Calloway School of
Winston-Salem, NC 27104 Business and Accounting; Associate
Professor of Finance of the School of
Business and Accounting at Wake Forest
University since 1983.

*Zoe Ann Hines, 47 Trustee Senior Vice President of Stephens and
Director of Brokerage Accounting; and
Secretary of Stephens Resource
Management.

*W. Rodney Hughes, 70 Trustee Private Investor.
31 Dellwood Court
San Rafael, CA 94901

Robert M. Joses, 78 Trustee Private Investor.
47 Dowitcher Way
San Rafael, CA 94901

*J. Tucker Morse, 52 Trustee Private Investor; Real Estate Developer;
10 Legrae Street Chairman of Renaissance Properties Ltd.;
Charleston, SC 29401 President of Morse Investment
Corporation; and Co-Managing Partner of
Main Street Ventures.

Richard H. Blank, Jr., 40 Chief Operating Officer, Associate of Financial Services Group of
Secretary and Treasurer Stephens; Director of Stephens Sports
Management Inc.; and Director of Capo
Inc.
</TABLE>

8
<PAGE> 126
COMPENSATION TABLE
for the Fiscal Year Ended February 29, 1996

*R. Greg Feltus 0 0
Trustee

Thomas S. Goho 0 39,000
Trustee

*Zoe Ann Hines 0 0
Trustee

*W. Rodney Hughes 0 36,250
Trustee

Robert M. Joses 0 38,250
Trustee

*J. Tucker Morse 0 33,000
Trustee
</TABLE>

Trustees of MIP are compensated annually by MIP and by all the
registrants in the fund complex for their services as indicated above and also
are reimbursed for all out-of-pocket expenses relating to attendance at board
meetings. Each of the Trustees and Principal Officer of MIP also serves in the
identical capacity as Directors/Trustees and/or Principal Officer of
MasterWorks Funds, Inc. ("MasterWorks" formerly, Stagecoach Inc.), Managed
Series Investment Trust ("MSIT"), Stagecoach Funds, Inc., Overland Express
Funds, Inc., Stagecoach Trust, Life & Annuity Trust and Master Investment
Trust, each of which is a registered open-end management investment company and
each of which prior to January 1, 1996 and the reorganization of WFNIA, was
considered to be in the same "fund complex," as such term is defined in Form
N-1A under the 1940 Act, as MIP. Effective January 1, 1996, MIP, MasterWorks
and MSIT are considered to be members of the same fund complex and are no
longer part of the same fund complex as Stagecoach Funds, Inc., Overland
Express Funds, Inc., Stagecoach Trust, Life & Annuity Trust and Master
Investment Trust. The Trustees are compensated by other Companies and Trusts
within the fund complex for their services as Directors/Trustees to such
Companies and Trusts. Currently the Trustees do not receive any retirement
benefits or deferred compensation from MIP or any other member of the fund
complex.

9
<PAGE> 127
As of the date of this SAI, the Trustees and Principal Officer of
MIP as a group beneficially owned less than 1% of the outstanding shares of MIP.

ITEM 15. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.

As of June 1, 1996, the S&P 500 Stock Fund of MasterWorks Funds
Inc. ("MasterWorks"), 111 Center Street, Little Rock, Arkansas 72201, owned
approximately 95% of the outstanding voting securities of the S&P 500 Index
Master Portfolio and could be considered a "controlling person" of the S&P 500
Index Master Portfolio for purposes of the 1940 Act. As of June 1, 1996, the
Bond Index Fund of MasterWorks and the Bradley Trust, 1000 N. Water Street, 11th
Floor, Milwaukee, WI 53202, owned approximately 41% and 55%, respectively, of
the outstanding voting securities of the Bond Index Master Portfolio. As such,
the Fund and Bradley Trust could each be considered a "controlling person" of
the Bond Index Master Portfolio for purposes of the 1940 Act.

ITEM 16. INVESTMENT ADVISORY AND OTHER SERVICES.

The following information supplements and should be read in
conjunction with Item 5 in Part A.

Investment Adviser. BGFA provides investment advisory services to
each Master Portfolio pursuant to separate Investment Advisory Agreements
(each, a "BGFA Advisory Agreement") dated January 1, 1996 with the MIP. As to
each Master Portfolio, the applicable BGFA Advisory Agreement is subject to
annual approval by (i) MIP's Board of Trustees or (ii) vote of a majority (as
defined in the 1940 Act) of the outstanding voting securities of such Master
Portfolio, provided that in either event the continuance also is approved by a
majority of MIP's Board of Trustees who are not "interested persons" (as
defined in the 1940 Act) of MIP or BGFA, by vote cast in person at a meeting
called for the purpose of voting on such approval. As to each Master
Portfolios, the applicable BGFA Advisory Agreement is terminable without
penalty, on 60 days' written notice, by either party. The applicable BGFA
Advisory Agreement will terminate automatically, as to the relevant Master
Portfolio, in the event of its assignment (as defined in the 1940 Act).

Prior to January 1, 1996, Wells Fargo Bank provided investment
advisory services to each Master Portfolio pursuant to an Investment Advisory
Agreement (the "Advisory Agreement") dated February 25, 1994 with MIP. The
terms of the Advisory Agreement were identical in all material respects, other
than the identity of the parties, to each BGFA Advisory Agreement.

Advisory Fees Paid. For the period beginning May 26, 1994
(commencement of operations) and ended February 28, 1995 and the period
beginning March 1, 1995 and ended December 31, 1995, the Master Portfolios paid
the following advisory fees to Wells Fargo Bank and Wells Fargo Bank waived the
indicated amounts. For the period beginning January 1, 1996 and ended February
29, 1996, the Master Portfolios paid the following advisory fees to BGFA and
BGFA waived the indicated amounts:

10
<PAGE> 128
<TABLE>
<CAPTION>
May 26, 1994 - March 1, 1995 - January 1, 1996 -
February 28, 1995 December 31, 1995 February 29, 1996
Fees Paid Fees Waived Fees Paid Fees Waived Fees Paid Fees Waived
--------- ----------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Bond Index Master Portfolio $ 34,581 $ 8,713 $ 91,365 $0 $20,123 $0

S&P 500 Index Master $138,830 $17,864 $279,843 $0 $73,598 $0
Portfolio
</TABLE>

Sub-Investment Adviser. The Master Portfolios do not currently
engage a sub-adviser. However, prior to January 1, 1996, WFNIA provided
sub-investment advisory services to each Master Portfolio pursuant to a
Sub-Investment Advisory Agreement (the "Sub-Advisory Agreement") dated February
25, 1994 with Wells Fargo Bank and MIP.

Sub-Advisory Fees Paid. For the period from May 26, 1994
(commencement of operations) to February 28, 1995, and the period beginning
March 1, 1995 and ended December 31, 1995, Wells Fargo Bank paid the following
sub- advisory fees to WFNIA for services provided on behalf of each Master
Portfolio and WFNIA waived the amounts shown:

<TABLE>
<CAPTION>
May 26, 1994 - February 28, 1995 March 1, 1995 - December 31, 1995
Fees Paid Fees Waived Fees Paid Fees Waived
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Bond Index Master Portfolio $ 34,581 $ 8,713 $ 72,919 $0

S&P 500 Index Master Portfolio $138,830 $17,864 $224,069 $0
</TABLE>

Administrator. Stephens provides administrative services to MIP
pursuant to an Administration Agreement dated February 25, 1994 (the
"Administration Agreement"). Under the Administration Agreement, Stephens
provides as administrative services, among other things: (i) general
supervision of the operation of the MIP and the Master Portfolios, including
coordination of the services performed by the investment adviser, transfer and
dividend disbursing agent, custodians, interestholder servicing agent(s),
independent auditors and legal counsel; (ii) general supervision of regulatory
compliance matters, including the compilation of information for documents such
as reports to, and filings with, the SEC and state securities commissions, and
preparation of proxy statements and interestholder reports for the Master
Portfolios; and (iii) general supervision relative to the compilation of data
required for the preparation of periodic reports distributed to the MIP's
officers and Board of Trustees. Stephens also furnishes office space and
certain facilities required for conducting the business of the MIP together
with those ordinary clerical and bookkeeping services that are not being
furnished by the Master Portfolios' investment advisor. Stephens also pays the
compensation of the MIP's Trustees, officers and employees who are affiliated
with Stephens.

Stephens is not entitled to compensation for providing
administrative services to a Master Portfolio so long as Stephens receives fees
for providing similar services to a fund of another investment company which
invests all of its assets in such Master Portfolio. For the period from
commencement of operations until February 28, 1995 and for the fiscal year
ended February 29, 1996, the Master Portfolios did not pay any administrative
fees to Stephens.

11
<PAGE> 129
Custodian, Transfer and Dividend Disbursing Agent. BZW Barclays
Global Investors, N.A., ("BGI"), a wholly- owned subsidiary of BZW Barclays
Global Investors Holdings Inc., acts as custodian to MIP. The custodian, among
other things, maintains a custody account or accounts in the name of the MIP;
receives and delivers all assets for the MIP upon purchase and upon sale or
maturity; collects and receives all income and other payments and distributions
on account of the assets of the MIP and pays all expenses of the MIP. For the
fiscal year ended February 29, 1996, the Master Portfolios did not pay any
custody fees. Wells Fargo Bank acts as MIP's transfer and dividend disbursing
agent and performs such services at 525 Market Street, San Francisco,
California 94105. Wells Fargo Bank is not entitled to receive compensation for
providing such services to MIP so long as it receives fees for providing
similar services to the funds which invest substantially all of their assets in
the Master Portfolios. For the fiscal year ended February 29, 1996, the Master
Portfolios did not pay any transfer and dividend disbursing agency fees.

ITEM 17. BROKERAGE ALLOCATION AND OTHER PRACTICES.

General. BGFA assumes general supervision over placing orders on
behalf of each Master Portfolio for the purchase or sale of portfolio
securities. Allocation of brokerage transactions, including their frequency,
is made in the best judgment of BGFA and in a manner deemed fair and reasonable
to shareholders. In executing portfolio transactions and selecting brokers or
dealers, BGFA seeks to obtain the best overall terms available for each Master
Portfolio. In assessing the best overall terms available for any transaction,
BGFA considers factors deemed relevant, including the breadth of the market in
the security, the price of the security, the financial condition and execution
capability of the broker or dealer, and the reasonableness of the commission,
if any, both for the specific transaction and on a continuing basis. The
primary consideration is prompt execution of orders at the most favorable net
price. Certain of the brokers or dealers with whom the Master Portfolios may
transact business offer commission rebates to the Master Portfolios. BGFA
considers such rebates reasonableness of brokerage commissions paid is
evaluated by BGFA based upon its knowledge of available information as to the
general level of commissions paid by other institutional investors for
comparable services. Prior to January 1, 1996, WFNIA exercised general
supervision over placing orders on behalf of each Master Portfolio for the
purchase or sale of portfolio securities and the brokerage allocation practices
described herein are applicable to WFNIA and the Master Portfolios prior to
January 1, 1996.

S&P 500 Index Master Portfolio. Brokers also are selected because
of their ability to handle special executions such as are involved in large
block trades or broad distributions, provided the primary consideration is met.
Portfolio turnover may vary from year to year, as well as within a year. High
turnover rates over 100% are likely to result in comparatively greater
brokerage expenses.

Bond Index Master Portfolio. Purchases and sales of portfolio
securities for the Bond Index Master Portfolio usually are principal
transactions. Portfolio securities ordinarily are purchased directly from the
issuer or from an underwriter or market maker. Usually no brokerage
commissions are paid by the Master Portfolio for such purchases and sales. The
prices paid to the underwriters of newly-issued securities usually include a
concession paid by the issuer to the underwriter, and purchases of securities
from market makers may include the spread between the bid and asked price.

Brokerage Commissions. For the period from commencement of
operations until February 28, 1995 and for the year ended February 29, 1996 the
Master Portfolios paid brokerage

12
<PAGE> 130
commissions in the dollar amounts shown below. None of the brokerage
commissions were paid to affiliated brokers.

<TABLE>
<CAPTION>
Master Portfolio 1995 1996
- ---------------- -------- -------
<S> <C> <C>
S&P 500 Index Master Portfolio $244,742 $80,902
Bond Index Master Portfolio $ 0 $ 0
</TABLE>

Securities of Regular Broker/Dealers. On February 29, 1996, the
Master Portfolios did not own securities of their "regular brokers or dealers"
or their parents, as defined in the 1940 Act.

ITEM 18. CAPITAL STOCK AND OTHER SECURITIES.

Pursuant to MIP's Declaration of Trust, the Trustees are
authorized to issue shares of beneficial interests in each Master Portfolio.
Investors in a Master Portfolios are entitled to participate pro rata in
distributions of taxable income, loss, gain and credit of such Master
Portfolios. Upon liquidation or dissolution of a Master Portfolios, investors
are entitled to share pro rata in such Master Portfolios' net assets available
for distribution to its investors. Investments in a Master Portfolio have no
preference, pre-exemptive, conversion or similar rights and are fully paid and
non-assessable, except as set forth below. Investments in the Master
Portfolios may not be transferred. No certificates are issued.

Each investor is entitled to vote, with respect to matters
affecting each of MIP's portfolios, in proportion to the amount of its
investment in the MIP. Investors in the MIP do not have cumulative voting
rights, and investors holding more than 50% of the aggregate beneficial
interest in MIP may elect all of the Trustees of MIP if they choose to do so
and in such event the other investors in MIP would not be able to elect any
Trustee. MIP is not required to hold annual meetings of investors but MIP may
hold special meetings of investors when in the judgment of MIP's Trustees it is
necessary or desirable to submit matters for an investor vote.

Rule 18f-2 under the 1940 Act provides that any matter required to
be submitted under the provisions of the 1940 Act or applicable state law or
otherwise to the holders of the outstanding voting securities of an investment
company, such as MIP, will not be deemed to have been effectively acted upon
unless approved by the holders of a majority of the outstanding shares of each
Master Portfolio affected by such matter. Rule 18f-2 further provides that a
Master Portfolio shall be deemed to be affected by a matter unless it is clear
that the interests of such Master Portfolio in the matter are identical or that
the matter does not affect any interest of such Master Portfolio. However, the
Rule exempts the selection of independent accountants and the election of
Trustees from the separate voting requirements of the Rule.

13
<PAGE> 131
ITEM 19. PURCHASE, REDEMPTION AND PRICING OF SECURITIES.

The following information supplements and should be read in
conjunction with Items 7 and 8 in Part A.

Suspension of Redemptions. The right of redemption of Master
Portfolio shares may be suspended or the date of payment postponed (a) during
any period when the New York Stock Exchange is closed (other than customary
weekend and holiday closings), (b) when trading in the markets the Master
Portfolios ordinarily utilizes is restricted, or when an emergency exists as
determined by the Securities and Exchange Commission so that disposal of the
Master Portfolios' investments or determination of its net asset value is not
reasonably practicable, or (c) for such other periods as the Securities and
Exchange Commission by order may permit to protect the Master Portfolios'
shareholders.

Pricing of Securities.

S&P 500 Index Master Portfolio. The securities of the S&P 500
Index Master Portfolio, including covered call options written by the Master
Portfolios, are valued as discussed below. Domestic securities are valued at
the last sale price on the domestic securities or commodities exchange or
national securities market on which such securities primarily are traded.
Securities not listed on a domestic exchange or national securities market, or
securities in which there were no transactions, are valued at the most recent
bid prices. Portfolio securities which are traded primarily on foreign
securities or commodities exchanges generally are valued at the preceding
closing values of such securities on their respective exchanges, except that
when an occurrence subsequent to the time a value was so established is likely
to have changed such value, then the fair value of those securities is
determined by BGFA in accordance with guidelines approved by MIP's Board of
Trustees. Short-term investments are carried at amortized cost, which
approximates value. Any securities or other assets for which recent market
quotations are not readily available are valued at fair value as determined in
good faith by BGFA in accordance with such guidelines.

Restricted securities, as well as securities or other assets for
which market quotations are not readily available, or are not valued by a
pricing service approved by MIP's Board of Trustees, are valued at fair value
as determined in good faith by BGFA in accordance with guidelines approved by
MIP's Board of Trustees. BFGA and MIP's Board of Trustees periodically review
the method of valuation. In making its good faith valuation of restricted
securities, BGFA generally takes the following factors into consideration:
restricted securities

14
<PAGE> 132
which are, or are convertible into, securities of the same class of securities
for which a public market exists usually will be valued at market value less
the same percentage discount at which purchased. This discount is revised
periodically if it is believed that the discount no longer reflects the value
of the restricted securities. Restricted securities not of the same class as
securities for which a public market exists usually are valued initially at
cost. Any subsequent adjustment from cost is based upon considerations deemed
relevant by MIP's Board of Trustees.

Bond Index Master Portfolio. The investments of the Bond Index
Master Portfolio are valued each business day using available market quotations
or at fair value as determined by one or more independent pricing services
(collectively, the "Services") approved by MIP's Board of Trustees. Services
may use available market quotations, employ electronic data processing
techniques and/or a matrix system to determine valuations. Each Service's
procedures are reviewed by MIP's officers under the general supervision of
MIP's Board of Trustees. Expenses and fees, including advisory fees, are
accrued daily and are taken into account for the purpose of determining the net
asset value of a Master Portfolio's shares. Expenses and fees, including
advisory fees, are accrued daily and are taken into account for the purpose of
determining the net asset value of a Master Portfolio's shares.

ITEM 20. TAX STATUS.

MIP is organized as a business trust under Delaware law. Under
MIP's current classification for federal income tax purposes, each Master
Portfolio will be treated as a partnership and, therefore, will not be subject
to any federal income tax. However, each investor in a Master Portfolio will
be taxable on its share (as determined in accordance with the governing
instruments of MIP) of such Master Portfolio's ordinary income and capital gain
in determining its federal income tax liability. The determination of such
share will be made in accordance with the Internal Revenue Code of 1986, as
amended (the "Code"), and regulations promulgated thereunder.

MIP's taxable year-end is the last day of February. Although MIP
will not be subject to Federal income tax, it will file appropriate Federal
income tax returns.

15
<PAGE> 133

ITEM 21. UNDERWRITERS.

The exclusive placement agent for MIP is Stephens, which receives
no compensation for serving in this capacity. Registered broker/dealers and
investment companies, insurance company separate accounts, common and
commingled trust funds, group trust and similar organizations and entities
which constitute accredited investors, as defined in the regulations adopted
under the 1933 Act, may continuously invest in a Master Portfolio of MIP.

ITEM 22. CALCULATIONS OF PERFORMANCE DATA.

Not applicable.

ITEM 23. FINANCIAL INFORMATION.

The portfolio of investments, audited financial statements and
independent auditors' report for the Master Portfolios for the fiscal year
ended February 29, 1996 are hereby incorporated by reference to the MasterWorks
Funds Inc. Annual Report, as filed with the SEC on May 28, 1996. The portfolio
of investments, audited financial statements and independent auditors' report
for the Master Portfolios are attached to all Part Bs delivered to
interestholders or prospective interestholders.

16
<PAGE> 134
APPENDIX

S&P

Bond Ratings

AAA

Bonds rated "AAA" have the highest rating assigned by S&P.
Capacity to pay interest and repay principal is extremely strong.

Bonds rated "AA" have a very strong capacity to pay interest and
repay principal and differ from the highest rated issues only in small degree.

BBB

S&P's letter ratings may be modified by the addition of a plus (+)
or minus (-) sign designation, which is used to show relative standing within
the major rating categories, except in the AAA (Prime Grade) category.

Commercial Paper Rating

A-1
<PAGE> 135
Moody's

Bond Ratings

Aaa

Bonds which are rated "Aaa" are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally referred to
as "gilt edge." 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 which are rated "Aa" are judged to be of high quality by all
standards. Together with the Aaa group they comprise what generally are 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.

Baa

Moody's applies the numerical modifiers "1," "2" and "3" to show
relative standing within the major rating categories, except in the "Aaa"
category. The modifier "1" indicates a ranking for the security in the higher
end of a rating category; the modifier "2" indicates a mid-range ranking; and
the modifier "3" indicates a ranking in the lower end of a rating category.

Commercial Paper Rating

The rating "Prime-1" (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of "P-1" paper must have a superior capacity for
repayment of short-term

A-2
<PAGE> 136
promissory obligations, and ordinarily will be evidenced by leading market
positions in well established industries, high rates of return on funds
employed, conservative capitalization structures with moderate reliance on debt
and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established
access to a range of financial markets and assured sources of alternate
liquidity.

Issuers (or relating supporting institutions) rated "Prime-2"
(P-2) have a strong capacity for repayment of short-term promissory
obligations. This ordinarily will be evidenced by many of the characteristics
cited above but to a lesser degree. Earnings trends and coverage ratios, while
sound, will be more subject to variation. Capitalization characteristics,
while still appropriate, may be more affected by external conditions. Ample
alternate liquidity is maintained.

Fitch

Bond Ratings

AAA

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 issuers is
generally rated "F-1+".

Bonds rated "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.

A-3
<PAGE> 137
BBB

Plus (+) and minus (-) signs are used with a rating symbol to
indicate the relative position of a credit within the rating category.

Short-Term Ratings

F-1+

Exceptionally Strong Credit Quality. Issues assigned this rating
are regarded as having the strongest degree of assurance for timely payment.

F-1

Very Strong Credit Quality. Issues assigned this rating reflect
an assurance of timely payment only slightly less in degree than issues rated
"F-1+."

F-2

Good Credit Quality. Issues carrying this rating have a
satisfactory degree of assurance for timely payments, but the margin of safety
is not as great as the "F-1+" and "F-1" categories.

Duff

A-4
<PAGE> 138
Bond Ratings

AAA

Bonds rated "AAA" are considered highest credit quality. The risk
factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.

Bonds rated "AA" are considered high credit quality. Protection
factors are strong. Risk is modest but may vary slightly from time to time
because of economic conditions.

Bonds rated "A" have protection factors which are average but
adequate. However, risk factors are more variable and greater in periods of
economic stress.

BBB

Bonds rated "BBB" are considered to have below average protection
factors but still considered sufficient for prudent investment. Considerable
variability in risk during economic cycles.

Plus (+) and minus (-) signs are used with a rating symbol (except
"AAA") to indicate the relative position of a credit within the rating
category.

Commercial Paper Rating

IBCA

Bond and Long-Term Ratings

Obligations rated "AAA" by IBCA have 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
for which there is a very low expectation of investment risk are rated AA by
IBCA. 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.

A-5
<PAGE> 139
Commercial Paper and Short-Term Ratings

International and U.S. Bank Ratings

An IBCA bank rating represents IBCA's current assessment of the
strength of the bank and whether such bank would receive support should it
experience difficulties. In its assessment of a bank, IBCA uses a dual rating
system comprised of Legal Ratings and Individual Ratings. In addition, IBCA
assigns banks Long- and Short-Term Ratings as used in the corporate ratings
discussed above. Legal Ratings, which range in gradation from 1 through 5,
address the question of whether the bank would receive support provided by
central banks or shareholders if it experienced difficulties, and such ratings
are considered by IBCA to be a prime factor in its assessment of credit risk.
Individual Ratings, which range in gradations from A through E, represent
IBCA's assessment of a bank's economic merits and address the question of how
the bank would be viewed if it were entirely independent and could not rely on
support from state authorities or its owners.

A-6
<PAGE> 140

MASTER INVESTMENT PORTFOLIO

FILE NO. 811-8162

PART C. OTHER INFORMATION

Item 24. Financial Statements and Exhibits

(a) Financial Statements

The portfolio of investments, audited financial statements and
independent auditors' report for the Asset Allocation, Bond Index, S&P 500
Index and U.S. Treasury Allocation Master Portfolios for the fiscal year ended
February 29, 1996, are hereby incorporated by reference to the MasterWorks
Funds Inc. Annual Report, as filed with the SEC on May 28, 1996.

The portfolio of investments, audited financial statements and
independent auditors' report for the LifePath 2000, LifePath 2010, LifePath
2020, LifePath 2030 and LifePath 2040 Master Portfolios for the fiscal year
ended February 29, 1996, are hereby incorporated by reference to the Stagecoach
Trust Annual Report, as filed with the SEC on May 28, 1996.

(b) Exhibits:

<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C><C>
1(a) - Amended and Restated Declaration of Trust, incorporated by reference to the Registration
Statement on Form N-1A, filed November 15, 1993.

1(b) - Certificate of Trust, incorporated by reference to the Registration Statement on Form
N-1A, filed November 15, 1993.

2 - By-Laws, incorporated by reference to the Registration Statement on Form N-1A filed
November 15, 1993.

3 - Not Applicable.

4 - Not Applicable.

5(a) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2000 Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(b) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2010 Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.
</TABLE>

C-1
<PAGE> 141

<TABLE>
<S> <C><C>
5(c) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2020 Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(d) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2030 Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(e) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the LifePath 2040 Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(f) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the Bond Index Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(g) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the Asset Allocation Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(h) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the S&P 500 Index Master
Portfolio, incorporated by reference to Amendment No. 3 to the Registration Statement,
filed January 5, 1996.

5(i) - Investment Advisory Contract by and among BZW Barclays Global Fund Advisors and Master
Investment Portfolio dated January 1, 1996, on behalf of the U.S. Treasury Allocation
Master Portfolio, incorporated by reference to Amendment No. 3 to the Registration
Statement, filed January 5, 1996.

6 - Placement Agency Agreement with Stephens Inc. on behalf of each Master Portfolio, filed
herewith.

7 - Not Applicable.

8 - Custody Agreement with BZW Barclays Global Investors, N.A., dated January 1, 1996 on
behalf of each Master Portfolio, filed herewith.

9 - Administration Agreement with Stephens Inc. on behalf of each Master Portfolio, filed
herewith.

10 - Not Applicable.

11 - Not Applicable.

12 - Not Applicable.

13 - Not Applicable.
</TABLE>

C-2
<PAGE> 142

<TABLE>
<S> <C><C>
14 - Not Applicable.

15 - Distribution Plan on behalf of the LifePath Master Portfolios, incorporated by reference
to Amendment No. 3 to the Registration Statement, filed January 5, 1996.

27(a) - Financial Data Schedules for the Asset Allocation Master Portfolio, U.S. Treasury
Allocation Master Portfolio, Bond Index Master Portfolio, S&P 500 Index Master
Portfolio, LifePath 2000 Master Portfolio, LifePath 2010 Master Portfolio, LifePath 2020
Master Portfolio, LifePath 2030 Master Portfolio, and LifePath 2040 Master Portfolio,
incorporated by reference to the Form N-SAR. filed April 29, 1996.
</TABLE>

Item 25. Persons Controlled by or Under Common Control with Registrant

No person is controlled by or under common control with the
Registrant.

Item 26. Number of Holders of Securities

As of May 15, 1996, the number of record holders of each class of
securities of the Registrant was as follows:

<TABLE>
<CAPTION>
(1) (2)

Number of Record
Title of Class Holders
-------------- ------------------
<S> <C>
Shares of beneficial interest, $.001 per share, of the following series:

LifePath 2000 Master Portfolio 3
LifePath 2010 Master Portfolio 3
LifePath 2020 Master Portfolio 3
LifePath 2030 Master Portfolio 3
LifePath 2040 Master Portfolio 3
S&P 500 Index Master Portfolio 4
Bond Index Master Portfolio 4
Asset Allocation Master Portfolio 2
U.S. Treasury Allocation Master Portfolio 2
</TABLE>

Item 27. Indemnification

Reference is made to Article IX of the Registrant's Declaration of
Trust. The application of these provisions is limited by Article 10 of the
Registrant's By-Laws and by the following undertaking set forth in the rules
promulgated by the Securities and Exchange Commission:

C-3
<PAGE> 143

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in such Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a trustee, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in such Act
and will be governed by the final adjudication of such issue.

ITEM 28. (a) Business and Other Connections of Investment Adviser

BZW Barclays Global Fund Advisors ("BGFA") is a wholly-owned
subsidiary of BZW Barclays Global Investors, N.A. ("BGI", formerly, Wells Fargo
Institutional Trust Company). BGFA serves as investment adviser to the
Registrant's Master Portfolios and to certain other open-end management
investment companies and various other institutional investors.

The directors and officers of BGFA consist primarily of persons
who during the past two years have been active in the investment management
business of the former sub-adviser to the Registrant, Wells Fargo Nikko
Investment Advisors ("WFNIA") and, in some cases, the service business of BGI,
the custodian of the Registrant's Master Portfolios. With the exception of
Irving Cohen, each of the directors and executive officers of BGFA will also
have substantial responsibilities as directors and/or officers of BGI. To the
knowledge of the Registrant, except as set forth below, none of the directors
or executive officers of BGFA is or has been at any time during the past two
fiscal years engaged in any other business, profession, vocation or employment
of a substantial nature.

<TABLE>
<CAPTION>
Name and Position Principal Business(es) During at
at BGFA Least the Last Two Fiscal Years
- --------------------- --------------------------------
<S> <C>

Frederick L.A. Grauer Chairman and Director of WFNIA and WFITC
Chairman, Director 45 Fremont Street, San Francisco, CA 94105

Donald L. Luskin Chief Executive Officer of WFNIA's Defined Contribution Group
Vice Chairman & Director 45 Fremont Street, San Francisco, CA 94105

Irving Cohen Chief Financial Officer and Chief Operating Officer of Barclays Bank
Director PLC, New York Branch and Chief Operating Officer of Barclays Group,
Inc. (USA)*: previously Chief Financial Officer of Barclays de Zoete
Wedd Securities Inc. (1994)
222 Broadway, New York, NY 10038

Andrea M. Zolberti Chief Financial Officer of WFNIA and WFITC
Chief Financial Officer 45 Fremont Street, San Francisco, CA 94105
</TABLE>

C-4

<PAGE> 144

<TABLE>
<S> <C>
Vincent J. Bencivenga Previously Vice President at State Street Bank & Trust Company
Chief Fiduciary Officer One Financial Center, Boston, Massachusetts 02111
</TABLE>

Prior to January 1, 1996, Wells Fargo Bank, N.A. ("Wells Fargo
Bank"), a wholly owned subsidiary of Wells Fargo & Company, served as
investment adviser to all of the Registrant's investment portfolios, and to
certain other registered open-end management investment companies. Wells Fargo
Bank's business is that of a national banking association with respect to which
it conducts a variety of commercial banking and trust activities.

To the knowledge of Registrant, none of the directors or executive
officers of Wells Fargo Bank, except those set forth below, is or has been at
any time during the past two fiscal years engaged in any other business,
profession, vocation or employment of a substantial nature, except that certain
executive officers also hold various positions with and engage in business for
Wells Fargo & Company. Set forth below are the names and principal businesses
of the directors and executive officers of Wells Fargo Bank who are or during
the past two fiscal years have been engaged in any other business, profession,
vocation or employment of a substantial nature for their own account or in the
capacity of director, officer, employee, partner or trustee. All the directors
of Wells Fargo Bank also serve as directors of Wells Fargo & Company.

<TABLE>
<CAPTION>
Name and Position Principal Business(es) and Address(es)
at Wells Fargo Bank During at Least the Last Two Fiscal Years
- ------------------- ------------------------------------------
<S> <C>
H. Jesse Arnelle Senior Partner of Arnelle & Hastie
Director 455 Market Street
San Francisco, CA 94105

Director of FPL Group, Inc.
700 Universe Blvd.
P.O. Box 14000
North Palm Beach, FL 33408

William R. Breuner General Partner in Breuner Associates, Breuner Properties and
Director Breuner-Pavarnick Real Estate Developers. Retired Chairman of
the Board of Directors of John Breuner Co.
2300 Clayton Road, Suite 1570
Concord, CA 94520

Vice Chairman of the California State Railroad
Museum Foundation.
111 I Street
Old Sacramento, CA 95814
</TABLE>

C-5
<PAGE> 145

<TABLE>
<S> <C>
William S. Davila President and Director of The Vons Companies, Inc.
Director 618 Michillinda Avenue
Arcadia, CA 91007

Officer of Western Association of Food Chains
825 Colorado Blvd. #203
Los Angeles, CA 90041

Rayburn S. Dezember Director of CalMat Co.
Director 3200 San Fernando Road
Los Angeles, CA 90065

Director of Tejon Ranch Co.
P.O. Box 1000
Lebec, CA 93243

Director of Turner Casting Corp.
P.O. Box 1099
Cudahy, CA 90201

Director of The Bakersfield Californian
P.O. Box 440 1701 I Street
Bakersfield, CA 93302

Director of Kern County Economic Development Corp.
P.O. Box 1229
2700 M Street, Suite 225
Bakersfield, CA 93301

Chairman of the Board of Trustees of Whittier College
13406 East Philadelphia Avenue
P.O. Box 634
Whittier, CA 90608

Paul Hazen Chairman of the Board of Directors of
Chairman of the Wells Fargo & Company
Board of Directors 420 Montgomery Street
San Francisco, CA 94105

Director of Pacific Telesis Group
130 Kearny Street
San Francisco, CA 94108

Director of Phelps Dodge Corp.
2600 North Central Avenue
Phoenix, AZ 85004

Director of Safeway Inc.
Fourth and Jackson Streets
Oakland, CA 94660

Robert K. Jaedicke Accounting Professor and Dean Emeritus of
Director Graduate School of Business, Stanford University
MBA Admissions Office
Stanford, CA 94305
</TABLE>

C-6
<PAGE> 146

<TABLE>
<S> <C>
Director of Homestake Mining Co.
650 California Street
San Francisco, CA 94108

Director of California Water Service Company
1720 North First Street
San Jose, CA 95112

Director of Boise Cascade Corp.
1111 West Jefferson Street
P.O. Box 50
Boise, ID 83728

Director of Enron Corp.
1400 Smith Street
Houston, TX 77002

Director of GenCorp, Inc.
175 Ghent Road
Fairlawn, OH 44333

Paul A. Miller Chairman of Executive Committee and Director of
Director Pacific Enterprises
633 West Fifth Street
Los Angeles, CA 90071

Trustee of Mutual Life Insurance Company of New York
1740 Broadway
New York, NY 10019

Director of Newhall Management Corporation
23823 Valencia Blvd.
Valencia, CA 91355

Trustee of University of Southern California
University Park TGF 200
655 Exposition Blvd.
Los Angeles, CA 90089

Ellen M. Newman President of Ellen Newman Associates
Director 323 Geary Street, Suite 507
San Francisco, CA 94102

Chair of Board of Trustees of
University of California at San Francisco Foundation
250 Executive Park Blvd., Suite 2000
San Francisco, CA 94143

Director of American Conservatory Theater
30 Grant Avenue
San Francisco, CA 94108
</TABLE>

C-7
<PAGE> 147

<TABLE>
<S> <C>
Director of California Chamber of Commerce
1201 K Street, 12th Floor
Sacramento, CA 95814

Philip J. Quigley Chairman, Chief Executive Officer and
Director Director of Pacific Telesis Group
130 Kearney Street, Rm. 3700
San Francisco, CA 94108

Director of Varian Associates
3050 Hansen Way
P.O. Box 10800
Palo Alto, CA 94303

Carl E. Reichardt Chairman and Chief Executive Officer of the
Director Board of Directors of Wells Fargo & Company
420 Montgomery Street
San Francisco, CA 94105

Director of Ford Motor Company
The American Road
Dearborn, MI 48121

Director of Hospital Corporation of America,
HCA-Hospital Corp. of America
One Park Plaza
Nashville, TN 37203

Director of Pacific Gas and Electric Company
77 Beale Street
San Francisco, CA 94105

Director of Newhall Management Corporation
23823 Valencia Blvd.
Valencia, CA 91355

Donald B. Rice President, Chief Operating Officer and Director of
Director Teledyne, Inc.
2049 Century Park East
Los Angeles, CA 90067

Director of Vulcan Materials Company
One Metroplex Drive
Birmingham, AL 35209

Retired Secretary of the Air Force

Susan G. Swenson President and Chief Executive Officer of Cellular One
Director 651 Gateway Blvd.
San Francisco, CA 94080

Chang-Lin Tien Chancellor of University of California at Berkeley
Director UC at Berkeley
Berkeley, CA 94720
</TABLE>

C-8
<PAGE> 148

<TABLE>
<S> <C>
John A. Young President, Director and Chief Executive Officer of
Director Hewlett-Packard Company
3000 Hanover Street
Palo Alto, CA 94304

Director of Chevron Corporation
225 Bush Street
San Francisco, CA 94104

William F. Zuendt Director of 3Com Corp.
President 5400 Bayfront Plaza
P.O. Box 58145
Santa Clara, CA 95052

Director of MasterCard International
888 Seventh Avenue
New York, NY 10106

Trustee of Golden Gate University
536 Mission Street
San Francisco, CA 94163
</TABLE>

Prior to January 1, 1996, WFNIA served as the sub-adviser to the
Asset Allocation, U.S. Treasury Allocation, Bond Index and S&P 500 Stock Master
Portfolios, and as adviser or sub-adviser to various other open-end management
investment companies. For additional information, see "Management" in the Part
B. For information as to the business, profession, vocation or employment of a
substantial nature of each of the officers and management committees of WFNIA,
reference is made to WFNIA's Form ADV and Schedules A and D filed under the
Investment Advisers Act of 1940, SEC File No. 801-36479, incorporated herein by
reference.

ITEM 29. Principal Underwriters

(a) Stephens Inc., placement agent for the Registrant, does not
presently act as investment adviser for any other registered investment
companies, but does act as principal underwriter for Overland Express Funds,
Inc., Stagecoach Funds, Inc., Stagecoach Trust, MasterWorks Funds Inc.
(formerly, Stagecoach Inc.), Nations Fund Trust, Nations Funds, Inc., Nations
Fund Portfolio, Inc. and Nations Institutional Reserves (formerly known as The
Capitol Mutual Funds), and is the exclusive placement agent for Master
Investment Trust, Managed Series Investment Trust and Life & Annuity Trust, all
of which are registered open-end management investment companies and has acted
as principal underwriter for the Liberty Term Trust, Inc., Nations Government
Income Term Trust 2003, Inc., Nations Government Income Term Trust 2004, Inc.
and the Managed Balanced Target Maturity Fund, Inc., which are closed-end
management investment companies.

(b) Information with respect to each director and officer of
the principal underwriter is incorporated by reference to Form ADV and
Schedules A and D filed by Stephens Inc. with the

C-9
<PAGE> 149

Securities and Exchange Commission pursuant to the Investment Advisors Act of
1940 (File No. 501-15510).

Item 30. Location of Accounts and Records

(a) The Registrant maintains accounts, books and other
documents required by Section 31(a) of the 1940 Act and the Rules thereunder
(collectively, "Records") at the offices of Stephens Inc., 111 Center Street,
Little Rock, Arkansas 72201.

(b) BGFA maintains all Records relating to its services as
investment adviser for the period beginning January 1, 1996 at 45 Fremont
Street, San Francisco, California 94105. BGI maintains all Records relating
to its services as custodian at the same address.

(c) Wells Fargo Bank maintains all Records relating to its
services as investment adviser for the period prior to January 1, 1996 and for
its services as transfer and dividend disbursing agent at 525 Market Street,
San Francisco, California 94105.

(d) Stephens maintains all Records relating to its services as
sponsor, administrator and placement agent at 111 Center Street, Little Rock,
Arkansas 72201.

Item 31. Management Services

Other than as set forth under the captions "Item 5 Management of
the Master Portfolios" in Part A of this Registration Statement and "Item 16
Investment Advisory and Other Services" in Part B of this Registration
Statement, Registrant is not a party to any management-related service
contract.

Item 32. Undertakings

(a) Not applicable.

(b) Not applicable.

(c) Registrant hereby undertakes to call a meeting of
shareholders for the purpose of voting upon the questions of removal of a
trustee or trustees when requested in writing to do so by the holders of at
least 10% of the Registrant's outstanding shares of beneficial interest and in
connection with such meeting to comply with the provisions of Section 16(c) of
the Investment Company Act of 1940 relating to shareholder communications.

C-10
<PAGE> 150

SIGNATURES

Pursuant to the requirements of the Investment Company Act of
1940, the Registrant has duly caused this Amendment to the Registration
Statement on Form N-1A to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Little Rock, State of Arkansas, on the 26th day
of June, 1996.

MASTER INVESTMENT PORTFOLIO

By: /s/ RICHARD H. BLANK, JR.
-----------------------------------
Name: Richard H. Blank, Jr.
Title: Chief Operating Officer,
Secretary and Treasurer

<TABLE>
<CAPTION>
Signature Title
- --------- -----
<S> <C>
* Chairman, President
- -------------------------------------------- (Principal Executive
(R. Greg Feltus) Officer) and Trustee

/s/ Richard H. Blank, Jr. Chief Operating Officer,
- -------------------------------------------- Secretary and Treasurer
(Richard H. Blank, Jr.) (Principal Financial
Officer)

* Trustee
- --------------------------------------------
(Jack S. Euphrat)

* Trustee
- --------------------------------------------
(Thomas S. Goho)

* Trustee
- --------------------------------------------
(Zoe Ann Hines)

* Trustee
- ---------------------------------------------
(W. Rodney Hughes)

* Trustee
- --------------------------------------------
(Robert M. Joses)

* Trustee
- --------------------------------------------
(J. Tucker Morse)

June 26, 1996

*By: /s/ Richard H. Blank, Jr.
-------------------------
(Richard H. Blank, Jr.)
As Attorney-in-Fact
</TABLE>
<PAGE> 151

MASTER INVESTMENT PORTFOLIO

FILE NO. 811-8162

EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
EX-99.B6 Placement Agent Agreement with Stephens Inc. on behalf of each
Master Portfolio.

EX-99.B8 Custody Agreement with BGI on behalf of each Master Portfolio.

EX-99.B9 Administration Agreement with Stephens Inc. on behalf of each
Master Portfolio.
</TABLE>

<PAGE> 1

EXHIBIT 99.B6

PLACEMENT AGENCY AGREEMENT

MASTER INVESTMENT PORTFOLIO
111 Center Street
Little Rock, Arkansas 72201

February 25, 1994

Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201

Dear Sirs:

This is to confirm that, in consideration of the agreements
hereinafter contained, the undersigned, Master Investment Portfolio, a Delaware
business trust (the "Master Portfolio") consisting of the portfolios named on
Schedule 1 hereto, as such Schedule may be revised from time to time (each, a
"Master Series"), has agreed that you shall be, for the period of this
Agreement, the exclusive placement agent for shares of beneficial interest of
each Master Series.

1. You will act as agent for the private placement of shares
of each Master Series covered by, and in accordance with, the registration
statement and prospectus then in effect under the Investment Company Act of
1940, as amended, and will transmit promptly any orders received by you for
purchase or redemption of shares of a Master Series to the Transfer and
Dividend Disbursing Agent for the Master Portfolio of which the Master
Portfolio has notified you in writing. All orders from you shall be subject to
acceptance and confirmation by the Master Portfolio.

2. You shall act as exclusive placement agent for each Master
Series' shares in compliance with all applicable laws, rules and regulations,
including, without limitation, all rules and regulations made or adopted
pursuant to the Investment Company Act of 1940, as amended, by the Securities
and Exchange Commission or any securities association registered under the
Securities Exchange Act of 1934, as amended.

3. Whenever in their judgment such action is warranted by
market, economic or political conditions, or by abnormal circumstances of any
kind, the Master Portfolio's officers may decline to accept any orders for, or
make any sales of, any of the Master Series' shares until such time as they
deem it advisable to accept such orders and to make such sales and the Master
Portfolio shall advise you promptly of such determination.

4. Ownership of Master Series shares sold hereunder shall be
registered in such names and denominations as are specified in writing to the
Master Portfolio or to its agent designated for the purpose. No certificates
for shares of the Master Series will be issued.

5. The Master Portfolio agrees to pay all expenses in
connection with maintaining facilities for the issue and transfer of the Master
Series' shares and for supplying information, prices and other data

1
<PAGE> 2

to be furnished by the Master Portfolio hereunder, and all expenses in
connection with preparing and printing the Master Portfolio's prospectuses and
statements of additional information for regulatory purposes and for
distribution to shareholders; provided, however, that nothing contained herein
shall be deemed to require the Master Portfolio to pay any of the costs of
advertising the sale of the Master Series' shares. You shall pay all other
expenses incurred by you in connection with the sale of the Master Series'
shares as contemplated in this agreement.

6. All shares offered for sale and sold by you shall be
offered for sale and sold by you to investors at the price per share (the
"offering price," which is the net asset value per share) specified and
determined as provided in the prospectus relating to the offering of relevant
Master Series' shares for sale. If the offering price is not an exact multiple
of one cent, it shall be adjusted to the nearest full cent. The Master
Portfolio shall determine and furnish promptly to you a statement of the
offering price at least once on each day on which the prospectus states the
Master Portfolio is required to determine the relevant Master Series' net asset
value for the purpose of pricing purchase orders. Each offering price shall
become effective at the time and shall remain in effect during the period
specified in the statement. Each such statement shall show the basis of its
computation. For purposes of establishing the offering price, the Master
Portfolio shall consider a purchase order to have been presented to it at the
time it was originally entered by you for transmission to it, provided the
original purchase order and your fulfilling order to the Master Portfolio are
appropriately time stamped or evidenced to show the time of original entry and
that your fulfilling order to the Master Portfolio is received by the Master
Portfolio within a time deemed by it to be reasonable after the purchase order
was originally entered. Purchases of shares shall be made for full and
fractional shares, carried to the third decimal place.

7. The Master Portfolio shall furnish you from time to time,
for use in connection with the sale of the Master Series' shares, such
information with respect to the Master Portfolio and the Master Series' shares
as you may reasonably request, all of which shall be signed by one or more of
the Master Portfolio's duly authorized officers; and the Master Portfolio
warrants that the statements contained in any such information, when so signed
by the Master Portfolio's officers, shall be true and correct. The Master
Portfolio also shall furnish you with copies of its reports to shareholders and
such additional information regarding a Master Series' financial condition as
you may reasonably request from time to time.

8. The Master Portfolio represents to you that all
registration statements and prospectuses filed by the Master Portfolio with the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended, with respect to the Master Series' shares have been carefully prepared
in conformity with the requirements of said Act and rules and regulations of
the Securities and Exchange Commission thereunder. As used in this agreement
the terms "registration statement" and "prospectus" shall mean any registration
statement and prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and Exchange
Commission and any amendments and supplements thereto which at any time shall
have been filed with said Commission. The Master Portfolio represents and
warrants to you that any registration statement and prospectus, when such
registration statement becomes effective, will contain all statements required
to be stated therein in conformity with said Act and the rules and regulations
of said Commission; that all statements of fact contained in any such
registration statement and prospectus will be true and correct when such
registration statement becomes effective; and that neither any registration
statement nor any prospectus when such registration statement becomes effective
will include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading. The Master Portfolio may but shall not be obligated to propose
from time to time such amendment or amendments to any registration statement
and such supplement or supplements to any prospectus as, in the light of future
developments, may, in the opinion of the Master Portfolio's counsel, be
necessary or

2
<PAGE> 3

advisable. If the Master Portfolio shall not propose such amendment or
amendments and/or supplement or supplements within fifteen days after receipt
by the Master Portfolio of a written request from you to do so, you may, at
your option, terminate this agreement or decline to make offers of the Master
Series' securities until such amendments are made. The Master Portfolio shall
not file any amendment to any registration statement or supplement to any
prospectus without giving you reasonable notice thereof in advance; provided,
however, that nothing contained in this agreement shall in any way limit the
Master Portfolio's right to file at any time such amendments to any
registration statement and/or supplements to any prospectus, of whatever
character, as the Master Portfolio may deem advisable, such right being in all
respects absolute and unconditional.

9. The Master Portfolio authorizes you to use any prospectus
in the form furnished to you from time to time, in connection with the sale of
the Master Series' shares. The Master Portfolio agrees to indemnify, defend
and hold you, your several officers and directors, and any person who controls
you within the meaning of Section 15 of the Securities Act of 1933, as amended,
free and harmless from and against any and all claims, demands, liabilities and
expenses (including the cost of investigating or defending such claims, demands
or liabilities and any counsel fees incurred in connection therewith) which
you, your officers and directors, or any such controlling person, may incur
under the Securities Act of 1933, as amended, or under common law or otherwise,
arising out of or based upon any untrue statement, or alleged untrue statement,
of a material fact contained in any registration statement or any prospectus or
arising out of or based upon any omission, or alleged omission, to state a
material fact required to be stated in either any registration statement or any
prospectus or necessary to make the statements in either thereof not
misleading; provided, however, that the Master Portfolio's agreement to
indemnify you, your officers or directors, and any such controlling person
shall not be deemed to cover any claims, demands, liabilities or expenses
arising out of any untrue statement or alleged untrue statement or omission or
alleged omission made in any registration statement or prospectus in reliance
upon and in conformity with written information furnished to the Master
Portfolio by you specifically for use in the preparation thereof. The Master
Portfolio's agreement to indemnify you, your officers and directors, and any
such controlling person, as aforesaid, is expressly conditioned upon the Master
Portfolio's being notified of any action brought against you, your officers or
directors, or any such controlling person, such notification to be given by
letter or by telegram addressed to the Master Portfolio at its office in San
Francisco, California within ten days after the summons or other first legal
process shall have been served. The failure so to notify the Master Portfolio
of any such action shall not relieve the Master Portfolio from any liability
which the Master Portfolio may have to the person against whom such action is
brought by reason of any such untrue, or alleged untrue, statement or omission,
or alleged omission, otherwise than on account of the Master Portfolio's
indemnity agreement contained in this paragraph 9. The Master Portfolio will
be entitled to assume the defense of any suit brought to enforce any such
claim, demand or liability, but, in such case, such defense shall be conducted
by counsel of good standing chosen by the Master Portfolio and approved by you.
In the event the Master Portfolio elects to assume the defense of any such suit
and retain counsel of good standing approved by you, the defendant or
defendants in such suit shall bear the fees and expenses of any additional
counsel retained by any of them; but in case the Master Portfolio does not
elect to assume the defense of any such suit, or in case you do not approve of
counsel chosen by the Master Portfolio, the Master Portfolio will reimburse
you, your officers and directors, or the controlling person or persons named as
defendant or defendants in such suit, for the fees and expenses of any counsel
retained by you or them. The Master Portfolio's indemnification agreement
contained in this paragraph 9 and the Master Portfolio's representations and
warranties in this agreement shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of you, your
officers and directors, or any controlling person, and shall survive the
delivery of any of the Master Series' shares. This agreement of indemnity will
inure exclusively to your benefit, to the benefit of your several officers and
directors, and their respective estates, and to the benefit of any controlling
persons and their successors. The Master

3
<PAGE> 4

Portfolio agrees promptly to notify you of the commencement of any litigation
or proceedings against the Master Portfolio or any of its officers or Trustees
in connection with the issue and sale of any of the Master Series' shares.

10. You agree to indemnify, defend and hold the Master
Portfolio, its several officers and Trustees, and any person who controls the
Master Portfolio within the meaning of Section 15 of the Securities Act of
1933, as amended, free and harmless from and against any and all claims,
demands, liabilities and expenses (including the cost of investigating or
defending such claims, demands or liabilities and any counsel fees incurred in
connection therewith) which the Master Portfolio, its officers or Trustees, or
any such controlling person, may incur under the Securities Act of 1933, as
amended, or under common law or otherwise, but only to the extent that such
liability or expense incurred by the Master Portfolio, its officers or
Trustees, or such controlling person resulting from such claims or demands,
shall arise out of or be based upon (a) any untrue, or alleged untrue,
statement of a material fact contained in information furnished in writing by
you to the Master Portfolio specifically for use in the Master Portfolio's
registration statement and used in the answers to any of the items of the
registration statement or in the corresponding statements made in the
prospectus, or shall arise out of or be based upon any omission, or alleged
omission, to state a material fact in connection with such information
furnished in writing by you to the Master Portfolio and required to be stated
in such answers or necessary to make such information not misleading or (b) any
act or omission or alleged act or omission on your part as the Master
Portfolio's agent that has not been expressly authorized by the Master
Portfolio in writing. Your agreement to indemnify the Master Portfolio, its
officers and Trustees, and any such controlling person, as aforesaid, is
expressly conditioned upon your being notified of any action brought against
the Master Portfolio, its officers or Trustees, or any such controlling person,
such notification to be given by letter or telegram addressed to you at your
principal office in Little Rock, Arkansas within ten days after the summons or
other first legal process shall have been served. You shall have the right to
control the defense of such action, with counsel of your own choosing,
satisfactory to the Master Portfolio, if such action is based solely upon such
alleged misstatement or omission on your part, and in any other event the
Master Portfolio, its officers or Trustees or such controlling person shall
each have the right to participate in the defense or preparation of the defense
of any such action. The failure so to notify you of any such action shall not
relieve you from any liability which you may have to the Master Portfolio, its
officers or Trustees, or to such controlling person by reason of any such
untrue, or alleged untrue, statement or omission, or alleged omission,
otherwise than on account of your indemnity agreement contained in this
paragraph 10.

11. None of the Master Series' shares shall be offered by
either you or the Master Portfolio under any of the provisions of this
agreement and no orders for the purchase or sale of such shares hereunder shall
be accepted by the Master Portfolio if and so long as the effectiveness of the
registration statement then in effect or any necessary amendments thereto shall
be suspended under any of the provisions of the Investment Company Act of 1940,
as amended; provided, however, that nothing contained in this paragraph 11
shall in any way restrict or have an application to or bearing upon the Master
Portfolio's obligation to repurchase any of the Master Series' shares from any
shareholder in accordance with the provisions of the Master Portfolio's
prospectus or Declaration of Trust.

12. The Master Portfolio agrees to advise you immediately in
writing:

(a) of any request by the Securities and Exchange Commission
for amendments to the registration statement or prospectus then in
effect or for additional information;

4
<PAGE> 5

(b) in the event of the issuance by the Securities and Exchange
Commission of any stop order suspending the effectiveness of the
registration statement or prospectus then in effect or the initiation
of any proceeding for that purpose;

(c) of the happening of any event which makes untrue any
statement of a material fact made in the registration statement or
prospectus then in effect or which requires the making of a change in
such registration statement or prospectus in order to make the
statements therein not misleading; and

(d) of all actions of the Securities and Exchange Commission
with respect to any amendments to any registration statement or
prospectus which may from time to time be filed with the Securities and
Exchange Commission.

13. Insofar as they concern the Master Portfolio, the Master
Portfolio shall comply with all applicable laws, rules and regulations,
including, without limiting the generality of the foregoing, all rules or
regulations made or adopted pursuant to the Securities Act of 1933, as amended,
the Investment Company Act of 1940, as amended, or by any securities
association registered under the Securities Exchange Act of 1934, as amended.

14. You may, if you desire and at your own cost and expense,
appoint or employ agents to assist you in carrying out your obligations under
this agreement, but no such appointment or employment shall relieve you of any
of your responsibilities or obligations to the Master Portfolio under this
agreement.

15. As to each Master Series, subject to the provisions of
Paragraph 8, this agreement shall continue until the date set forth opposite
such Master Series' name on Schedule 1 hereto (the "Reapproval Date"), and
thereafter shall continue automatically for successive annual periods ending on
the day of each year set forth opposite such Master Series' name on Schedule 1
hereto (the "Reapproval Day"), provided such continuance is specifically
approved at least annually by (i) the Master Portfolio's Board of Trustees or
(ii) vote of a majority (as defined in the Investment Company Act of 1940, as
amended) of the Master Portfolio's outstanding voting securities, provided that
in either event its continuance also is approved by a majority of the Master
Portfolio's trustees who are not "interested persons" (as defined in said Act)
of any party to this agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. This agreement is terminable without
penalty, on 60 days' notice, by vote of holders of a majority of the Master
Portfolio's shares, and, as to each Master Series, by the Master Portfolio's
Board of Trustees or by you. This agreement also will terminate automatically,
as to the relevant Master Series, in the event of its assignment (as defined in
said Act).

16. This agreement has been executed on behalf of the Master
Portfolio by the undersigned officer of the Master Portfolio in his capacity as
an officer of the Master Portfolio. The obligations of this agreement shall
only be binding upon the assets and property of the relevant Master Series, as
provided for in the Master Portfolio's Agreement and Declaration of Trust, and
shall not be binding upon any Trustee, officer or shareholder of the Master
Portfolio or Master Series individually.

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<PAGE> 6

Please confirm that the foregoing is in accordance with your
understanding and indicate your acceptance hereof by signing below, whereupon
it shall become a binding agreement between us.

Very truly yours,

MASTER INVESTMENT PORTFOLIO

By: /s/ Richard H. Blank, Jr,
-----------------------------------

Name: Richard H. Blank, Jr.
---------------------------------

Title: Chief Operating Officer
--------------------------------

ACCEPTED:

STEPHENS INC.

By: /s/ Richard H. Blank, Jr.
-------------------------------

Name: Richard H. Blank, Jr.
-----------------------------

Title: Vice President
----------------------------

6
<PAGE> 7
SCHEDULE 1

<TABLE>
<CAPTION>
Name of Master Series Reapproval Date* Reapproval Day*
- --------------------- --------------- --------------
<S> <C> <C>
LifePath 2000 Master Series

LifePath 2010 Master Series

LifePath 2020 Master Series

LifePath 2030 Master Series

LifePath 2040 Master Series

Small/Medium Stock Index
Master Series

International Stock Index
Master Series

Money Market Master Series

Short-Term Allocation
Master Series

Managed S&P Master Series

S&P 500 Index Master Series

Bond Index Master Series

Asset Allocation Master
Series

U.S. Treasury Allocation
Master Series
</TABLE>

* As to each Master Series, the Reapproval Date is October 25, 1995 and the
Reapproval Day is October 25.

<PAGE> 1

EXHIBIT 99.B8

CUSTODY AGREEMENT

This Agreement is made as of the 1st day of January, 1996 (the "Agreement"), by
and between MASTER INVESTMENT PORTFOLIO (the "Trust") on behalf of those Master
Portfolios named in the Appendix, as amended from time to time, (hereinafter
called the "Master Portfolios"), and BZW BARCLAYS GLOBAL INVESTORS, N.A., a
special purpose trust company (hereinafter called the "Custodian").

WITNESSETH:

that for and in consideration of the mutual promises hereinafter set forth the
Trust and the Custodian agree as follows:

1. Definitions

The word "securities" as used herein include stocks, shares, bonds,
debentures, notes, mortgages, or other obligations and any
certificates, receipts, warrants, options or other instruments
representing rights to receive, purchase, or subscribe for the same or
evidencing or representing any other rights or interests therein, or in
any property or assets.

The words "officers' certificate" shall mean a certification in writing
signed in the name of the Trust by those persons who are officers of
the Trust who are duly authorized to sign by the Board of Trustees of
the Trust (the "Board of Trustees").

The word "depository" shall mean The Depository Trust Company ("DTC"),
Participants Trust Company ("PTC"), and any other clearing agency
registered with the Securities and Exchange Commission under Section
17A of the Securities Exchange Act of 1934, its successor(s) and its
nominee(s), provided the Custodian has received a certified copy of a
resolution of the Board of Trustees specifically approving deposits in
DTC, PTC or such other clearing agency. The Term "Depository" shall
further mean and include any person authorized to act as a depository
pursuant to Section 17, Rule 17f-4 or Rule 17f-5 thereunder, under the
Investment Company Act of 1940, its successor(s) and its nominee(s),
specifically identified in a certified copy of a resolution of the
Board of Trustees specifically approving deposits therein by the
Custodian.

2. Names, Titles and Signatures of Trust's Officers

An officer of the Trust will certify to Custodian the names and
signatures of those persons authorized to sign the officers'
certificates described in Section 1 hereof, and the names of the
members of the Board of Trustees, together with any charges which may
occur from time to time.

3. Appointment and Authority of Custodian: Accounts, Receipt and
Disbursement of Money

A. The Trust hereby appoints Custodian as custodian of all
securities and moneys at any time owned by the Master
Portfolios during the term of this Agreement. Custodian
hereby accepts appointment as such custodian and agrees to
perform the duties thereof as hereinafter set forth.

B. Custodian shall open and maintain a separate account or
accounts in the name of the Master Portfolios. Custodian
shall hold in such account or accounts, subject to the

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<PAGE> 2

provisions hereof, all cash received by it from or for the
account of the Master Portfolios. Custodian shall make
payments of cash to, or for the account of, the Master
Portfolios from such cash only (a) for the purchase of
securities for the portfolios of the Master Portfolios upon
the delivery of such securities to Custodian, registered in
the name of the Master Portfolios or in the name of the
nominee of Custodian referred to in Section 7 hereof or in the
proper form for transfer, (b) for the purchase or redemption
of shares of beneficial ownership of the Master Portfolios,
(c) for the payment of interest, dividends, taxes, Director's
fees or operating expenses (including, without limitation,
fees for legal, accounting and auditing services and expense
for printing and postage), (d) for payments in connection with
the conversion, exchange or surrender of securities owned or
subscribed to by the Master Portfolios held by or to be
delivered to Custodian, or (e) for other purposes certified by
resolution of the Trust's Board of Trustees. Before making
any such payment Custodian shall receive instructions from the
Trust requesting such payment.

C. Custodian is hereby authorized to endorse and collect all
checks, drafts or other orders for the payment of money
received by Custodian for the account of the Master
Portfolios.

D. Subject to the requirements of the Investment Company Act of
1940 and subject to the approval of the Trust's Board of
Trustees, the Custodian shall have the authority to keep and
maintain the Master Portfolios' securities with certain
sub-custodians, including, but not limited to, Bankers Trust
Company, the Federal Reserve Book-Entry System DTC, PTC and
other depositories as defined above.

4. Receipt of Securities

Custodian shall hold in a separate account, pursuant to the
provisions hereof, all securities received by it from or for the account of the
Master Portfolios. All such securities are to be held or disposed of by
Custodian for, and subject at all times to the instructions of, the Master
Portfolios pursuant to the terms of this Agreement. Custodian shall have no
power or authority to assign, hypothecate, pledge or otherwise dispose of any
such securities and investments, except pursuant to the direction of the Master
Portfolios and only for the account of such Master Portfolios as set forth in
Section 5 of this Agreement.

5. Transfer, Exchange, Redelivery, etc. of Securities

Custodian shall have power to release or deliver any securities of
the Master Portfolios held by it pursuant to this Agreement on the direction of
the Master Portfolios. Custodian agrees to transfer, exchange or deliver
securities held by it hereunder only (a) for sales of such securities for the
account of such Master Portfolios upon receipt by Custodian of payment
therefor, (b) when such securities are called, redeemed or retired or otherwise
become payable, (c) for examination by a broker selling any such securities in
accordance with "street delivery" custom, (d) in exchange for, or upon
conversion into, other securities alone or other securities and cash, whether
pursuant to any plan or merger, consolidation, reorganization, recapitalization
or readjustment, or otherwise, (e) upon conversion of such securities pursuant
to their terms into other securities, (f) upon exercise of subscription,
purchase or other similar rights represented by such securities, (g) for the
purpose of exchanging interim receipts or temporary securities for definitive
securities, (h) for other proper purposes. As to any deliveries made by
Custodian pursuant to items (a), (b), (d), (e), (f), or (g), securities or cash
receivable in exchange therefor shall be deliverable to Custodian. Before
making any such transfer, exchange or delivery, Custodian shall receive (and
may rely upon) an officers' certificate requesting such transfer, exchange or
delivery, and stating that

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<PAGE> 3

it is for a purpose permitted under the terms of items (a) through (g)
inclusive of this Section 5 and also, in respect of item (h), upon receipt of
an officers' certificate specifying the securities to be delivered, setting
forth the purpose for which such delivery is to be made, declaring such purpose
to be a proper purpose, and naming the person or persons to whom delivery of
such securities shall be made; provided, however, that an officers' certificate
need not precede any such transfer, exchange or delivery of a money market
instrument if an authorized officer of the Trust issues appropriate oral
instructions to Custodian and an appropriate officers' certificate is received
by Custodian within two business days thereafter.

6. Custodian's Acts Without Instructions

Unless and until Custodian receives an officers' certificate or
other written instructions to the contrary, Custodian shall: (a) present for
payment all coupons and other income items held by it for the account of the
Master Portfolios which call for payment upon presentation and hold the cash
received by it upon such payment for the account of the Master Portfolios; (b)
collect interest and cash dividends received, with notice to the Master
Portfolios, for the account of the Master Portfolios; (c) hold for the account
of the Master Portfolios hereunder all stock dividends, rights and similar
securities issued with respect to any securities held by it hereunder; and (d)
execute as agent on behalf of the Master Portfolios all necessary ownership
certificates required by the Internal Revenue Code or the Income Tax
Regulations of the United States Treasury Department or under the laws of any
state now or hereafter in effect, inserting the Master Portfolios' name on such
certificates as the owner of the securities covered thereby, to the extent it
may lawfully do so.

7. Registration of Securities

Except as otherwise directed by an officers' certificate Custodian
shall register all securities, except such as are in bearer form, in nominee
form, and shall execute and deliver all such certificates in connection
therewith as may be required by such laws or regulations or under the laws of
any state. Custodian shall use its best efforts to insure that the specific
securities held by it hereunder shall be at all times identifiable in its
records.

The Trust shall from time to time furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register in the name of a nominee, any securities which it may hold for
the account of the Master Portfolios and which from time to time may be
registered in the name of the Master Portfolios.

8. Voting and Other Action

Neither Custodian nor any nominee of Custodian shall vote any of
the securities held hereunder by or for the account of the Master Portfolios,
except in accordance with the guidelines approved by the Trust.

9. Transfer Tax and Other Disbursements

The Trust shall pay or reimburse Custodian from time to time for
any transfer taxes payable upon transfers of securities made hereunder, and for
all other necessary, reasonable and proper disbursements and expenses made or
incurred by Custodian in the performance of this Agreement.

Custodian shall execute and deliver such certificates in
connection with securities delivered to it or by it under this Agreement as may
be required, under the provisions of the Internal Revenue Code and

3
<PAGE> 4

any Regulations of the Treasury Department issued thereunder, or under the laws
of any state, to exempt from taxation any exemptable transfers and/or
deliveries of any such securities.

10. Concerning Custodian

The Custodian shall not be entitled to compensation for providing
custody services to the Master Portfolios pursuant to this Agreement so long as
Custodian or BZW Barclays Global Fund Advisors receives fees for providing
investment advisory (or sub-advisory) services to the Master Portfolios. If it
or BZW Barclays Global Fund Advisors no longer receives compensation for
providing such services, Custodian shall be entitled to such compensation as it
may from time negotiate with the Trust.

Custodian shall not be liable for any action taken in good faith
upon any certificate herein described or certified copy of any resolution of
the Board of Trustees, and may rely on the genuineness of any such document
which it may in good faith believe to have been validly executed.

The Trust agrees to reimburse and make Custodian and its nominee
whole from all taxes, charges, expenses, assessments, claims, and liabilities
(including reasonable attorney's fees) incurred or assessed against it or by
its nominee in connection with the performance of this Agreement, except such
as may arise from Custodian's or its nominee's own negligent action, negligent
failure to act or willful misconduct. In the event of any advance of cash for
any purpose made by Custodian resulting from orders or instructions of the
Master Portfolios, or in the event that Custodian or its nominee shall incur or
be assessed any taxes, charges, expenses, assessments, claims or liabilities in
connection with the performance of this Agreement (except such as may arise
from Custodian or its nominee's own negligent action, negligent failure to act
or willful misconduct, and excluding any compensation payable by the Master
Portfolios to Custodian hereunder), any property at any time held for the
account of the Master Portfolios shall be security therefor.

Custodian shall reimburse, indemnify and make the Master
Portfolios whole for any actual loss or damages, including reasonable fees and
expenses of counsel, arising from Custodian's negligent action, negligent
failure to act or its willful misconduct.

11. Reports by Custodian

Custodian shall furnish the Master Portfolios from time to time
with a statement summarizing all transactions and entries for the account of
the Master Portfolios. Custodian shall furnish the Master Portfolios at the
end of every month with a list of the portfolio securities held for the Master
Portfolios showing the aggregate cost of each issue. Custodian shall furnish
the Master Portfolios, at the close of each quarter of the Master Portfolios'
fiscal year, with a list showing the cost of the securities held by it for the
Master Portfolios hereunder, adjusted for all commitments confirmed by the
Master Portfolios as of such close, certified by a duly authorized officer of
Custodian. The books and records of Custodian pertaining to its actions under
this Agreement shall be open to inspection and audit at reasonable times by
officers of, and auditors employed by, the Trust.

12. Termination of Agreement

This Agreement may be terminated by the Master Portfolios on
ninety (90) days notice, given in writing and sent by registered mail, to
Custodian at 45 Fremont Street, San Francisco, California 94105, or to the
Trust at 525 Market Street, Suite 1200, San Francisco, California 94163. Upon
termination of

4
<PAGE> 5

this Agreement, pending appointment of a successor to Custodian, Custodian
shall deliver cash, securities or other property of the Master Portfolios only
to a bank (as defined in the Investment Company Act of 1940, as amended; the
"1940 Act") located in San Francisco, California of its own selection, having
an aggregate capital, surplus and undivided profits, as shown by its last
published report of condition of not less than Two Million Dollars ($2,000,000)
as custodian for the Master Portfolios to be held under terms similar to those
of this Agreement provided, however, that Custodian shall not be required to
make any such delivery or payment until full payment shall have been made by
the Master Portfolios of all liabilities constituting a charge on or against
Custodian, and until full payment shall have been made to Custodian of all its
fees, compensation, costs and expenses, subject to the provisions of Section 10
of this Agreement. This Agreement may not be assigned by Custodian without the
consent of the Trust, authorized or approved by a resolution of its Board of
Trustees.

13. Deposits of Securities in Securities Depositories

No provision of the Agreement shall be deemed to prevent the use
by Custodian of a central securities clearing agency or securities depository;
provided, however, that Custodian and the central securities clearing agency or
securities depository meet all applicable federal and state laws and
regulations (including all applicable requirements of the 1940 Act and the
rules and regulations promulgated thereunder) and the Board of Trustees
approves by resolution the use of such central securities clearing agency or
securities depository.

14. Records

To the extent that Custodian in any capacity prepares or maintains
any records required to be maintained and preserved by the Trust pursuant to
the provisions of the 1940 Act or the rules and regulations promulgated
thereunder, Custodian agrees to make any such records available to the Trust
upon request and to preserve such records for the periods prescribed in Rule
31a-2 under the 1940 Act.

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<PAGE> 6

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date above-written by their respective
representatives thereunto duly authorized.

MASTER INVESTMENT PORTFOLIO

By: /s/ Richard H. Blank, Jr.
-----------------------------------

Name: Richard H. Blank, Jr.
---------------------------------

Title: Chief Operating Officer,
Secretary and Treasurer
--------------------------------

BZW BARCLAYS GLOABL FUND ADVISORS

By: /s/ Judith M. Nolte
-----------------------------------

Name: Judith M. Nolte
---------------------------------

Title: Senior Counsel, Assistant
Secretary
--------------------------------

By: /s/ Andrea M. Zolberti
-----------------------------------

Name: Andrea M. Zolberti
---------------------------------

Title: Chief Financing Officer
--------------------------------

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<PAGE> 7

APPENDIX

Asset Allocation Master Portfolio
Bond Index Master Portfolio
S&P 500 Index Master Portfolio
U.S. Treasury Allocation Master Portfolio
LifePath 2000 Master Portfolio
LifePath 2010 Master Portfolio
LifePath 2020 Master Portfolio
LifePath 2030 Master Portfolio
LifePath 2040 Master Portfolio

<PAGE> 1

EXHIBIT 99.B9

ADMINISTRATION AGREEMENT

MASTER INVESTMENT PORTFOLIO
111 Center Street
Little Rock, Arkansas 72201

January 14, 1994

Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201

Dear Sirs:

This will confirm the agreement between Master Investment
Portfolio (the "Trust") on behalf of the Series listed on the attached Appendix
A (each a "Master Series") and Stephens Inc. (the "Administrator") as follows:

1. The Trust is a registered open-end management investment
company currently consisting of fourteen investment portfolios, but which may
from time to time consist of a greater or lesser number of investment
portfolios (the "Master Series"). The Trust proposes to engage in the business
of investing and reinvesting the assets of the Master Series in the manner and
in accordance with the investment objective and restrictions specified in the
Trust's Registration Statement, as amended from time to time (the "Registration
Statement"), filed by the Trust under the Investment Company Act of 1940 (the
"1940 Act"). Copies of the documents referred to in the preceding sentence
have been furnished to the Administrator. Any amendments to those documents
shall be furnished to the Administrator promptly.

2. The Trust is engaging the Administrator to provide the
administrative services specified elsewhere in this agreement, subject to the
overall supervision of the Board of Trustees of the Trust. Pursuant to an
advisory contract between the Trust and Wells Fargo Bank, N.A. (the "Adviser")
on behalf of each Master Series, the Trust has engaged the Adviser to manage
the investing and reinvesting of the assets of the Master Series and to provide
advisory services.

3. The Administrator shall, at its expense, provide the
following administrative services in connection with the operations of the
Trust and the Master Series: (a) furnishing office space and certain
facilities required for conducting the business of the Master Series; (b)
general supervision of the operation of the Master Series, including
coordination of the services performed by the Trust's Adviser, transfer and
dividend disbursing agent, shareholder servicing agents, custodians,
independent auditors and legal counsel; regulatory compliance, including the
compilation of information for documents such as reports to, and filings with,
the

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<PAGE> 2

Securities and Exchange Commission and state securities commissions; and
preparation of proxy statements and reports for the holders of beneficial
interests ("Interests") of the Master Series ("Holders"); (c) the compensation
of the Trust's trustees, officers and employees who are affiliated with the
Administrator; (d) general supervision relating to the compilation of data
required for the preparation of periodic reports on the performance of its
obligations under this agreement and statements of the Master Series that are
distributed to the Trust's officers and Board of Trustees and the preparation
of such additional reports and information as the Trust's Board of Trustees or
officers shall reasonably request; and (e) all other administrative services
reasonably necessary for the operation of the Master Series, other than those
services that are to be provided by the Adviser pursuant to the Investment
Advisory Agreement and by the Trust's transfer and dividend disbursing agent.

4. Except as provided in the Trust's Investment Advisory
Agreement and Administration Agreement, the Trust shall bear all costs of its
operations, including the compensation of its trustees who are not affiliated
with the Adviser, the Administrator or any of their affiliates; advisory and
administrative fees; governmental fees; interest charges; taxes; fees and
expenses of its independent auditors, legal counsel, transfer agent and
dividend disbursing agent; expenses of redeeming Interests; expenses of
preparing and printing any certificates, prospectuses (except the expense of
printing and mailing prospectuses used for promotional purposes), Holders'
reports, notices, proxy statements and reports to regulatory agencies; travel
expenses of trustees, officers and employees; office supplies; insurance
premiums and certain expenses relating to insurance coverage; trade association
membership dues; brokerage and other expenses connected with the execution of
portfolio securities transactions; fees and expenses of any custodian,
including those for keeping books and accounts and calculating the net asset
value per Interest of the Master Series; expenses of Holders' meetings;
expenses relating to the issuance, registration and qualification of Interests
of the Master Series; pricing services, if any; organizational expenses; and
any extraordinary expenses. Expenses attributable to one or more, but not all,
of the Master Series are charged against the assets of the relevant Master
Series. General expenses of the Trust are allocated among the Master Series in
a manner proportionate to the net assets of each Master Series, on a
transactional basis or on such other basis as the Board of Trustees deems
equitable.

5. The Administrator shall give the Trust the benefit of the
Administrator's best judgment and efforts in rendering services under this
agreement. As an inducement to the Administrator's undertaking to render these
services, the Trust agrees that the Administrator shall not be liable under
this agreement for any mistake in judgment or in any other event whatsoever
except for lack of good faith, provided that nothing in this agreement shall be
deemed to protect or purport to protect the Administrator against any liability
to the Trust or its Holders to which the Administrator would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of the Administrator's duties under this agreement or by reason of
reckless disregard of its obligations and duties hereunder.

6. The Administrator shall not be entitled to compensation for
providing administrative services to a Master Series so long as the
Administrator receives fees for providing

2
<PAGE> 3

similar services to a fund of another registered investment company which
invests all of its assets in the Master Series.

7. This agreement shall become effective on its execution date
and shall thereafter continue in effect for a period of no less than three
years. Thereafter, this agreement may be terminated with respect to any Master
Series at any time, without the payment of any penalty, by a vote of a majority
of such Master Series' outstanding voting securities (as defined in the 1940
Act) and by a vote of a majority of the Trust's entire Board of Trustees on 60
days' written notice to the Administrator or by the Administrator on 60 days'
written notice to the Trust.

8. Except to the extent necessary to perform the
Administrator's obligations under this agreement, nothing herein shall be
deemed to limit or restrict the right of the Administrator, or any affiliate of
the Administrator, or any employee of the Administrator to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or association.

9. This agreement shall be governed by and construed in
accordance with the laws of the State of Arkansas.

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<PAGE> 4

If the foregoing correctly sets forth the agreement between the
Trust and the Administrator, please so indicate by signing and returning to the
Trust the enclosed copy hereof.

Very truly yours,

MASTER INVESTMENT PORTFOLIO

By: /s/ Richard H. Blank, Jr.
-----------------------------------

Name: Richard H. Blank, Jr.
---------------------------------

Title: Chief Operating Officer
--------------------------------

ACCEPTED as of the date set forth above:

STEPHENS INC.

By: /s/ Richard H. Blank, Jr.
------------------------------

Name: Richard H. Blank, Jr.
----------------------------

Title: Vice President
---------------------------

4
<PAGE> 5

Appendix A

Master Investment Portfolio

LifePath 2000 Master Portfolio

LifePath 2010 Master Portfolio

LifePath 2020 Master Portfolio

LifePath 2030 Master Portfolio

LifePath 2040 Master Portfolio

Asset Allocation Master Portfolio

Bond Index Master Portfolio

International Stock Index Master Portfolio

Managed S&P Master Portfolio

Medium/Small Stock Index Master Portfolio

Money Market Master Portfolio

S&P 500 Index Master Portfolio

Short-Term Allocation Master Portfolio

U.S. Treasury Allocation Master Portfolio