<PAGE> PAGE 1
000 B000000 11/30/96
000 C000000 0000926898
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0.a
000 J000000 A
001 A000000 MILESTONE FUNDS, INC.
001 B000000 811-8620
001 C000000 9149645355
002 A000000 ONE ODELL PLAZA
002 B000000 NEW YORK
002 C000000 NY
002 D010000 10701
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 Y
007 B000000 1
007 C010100 1
007 C020100 MILESTONE TREASURY OBLIGATIONS
007 C030100 N
007 C010200 2
007 C010300 3
007 C010400 4
007 C010500 5
007 C010600 6
007 C010700 7
007 C010800 8
007 C010900 9
007 C011000 10
008 A00AA01 MILESTONE CAPITAL MANAGEMENT, L.P.
008 B00AA01 A
008 C00AA01 801-47268
008 D01AA01 YONKERS
008 D02AA01 NY
008 D03AA01 10701
010 A00AA01 THE BANK OF NEW YORK
010 C01AA01 NEW YORK
010 C02AA01 NY
010 C03AA01 10286
011 A00AA01 MIDWEST FINANCIAL SERVICES, INC.
011 B00AA01 8-24674
011 C01AA01 CINCINNATI
011 C02AA01 OH
011 C03AA01 45201
011 C04AA01 5354
012 A00AA01 MGF SERVICE CORP
<PAGE> PAGE 2
012 B00AA01 84-00000
012 C01AA01 CINCINNATI
012 C02AA01 OH
012 C03AA01 45201
012 C04AA01 5354
013 A00AA01 MCGLADREY & PULLEN
013 B01AA01 NEW YORK
013 B02AA01 NY
013 B03AA01 10017
015 A00AA01 THE BANK OF NEW YORK
015 B00AA01 C
015 C01AA01 NEW YORK
015 C02AA01 NY
015 C03AA01 10286
015 E01AA01 X
018 00AA00 Y
019 A00AA00 N
019 B00AA00 0
020 C000001 0
020 C000002 0
020 C000003 0
020 C000004 0
020 C000005 0
020 C000006 0
020 C000007 0
020 C000008 0
020 C000009 0
020 C000010 0
021 000000 0
022 A000001 HSBC SECURITIES
022 B000001 13-2650272
022 C000001 37857412
022 D000001 192141
022 A000002 UBS SECURITIES
022 B000002 13-2932996
022 C000002 30701925
022 D000002 14843
022 A000003 SBC CAPILTAL MARKETS
022 B000003 13-2639550
022 C000003 23499357
022 D000003 0
022 A000004 LEHMAN BROTHERS
022 B000004 13-2518466
022 C000004 15548849
022 D000004 0
022 A000005 BARCLAYS DE ZOETE WEDD SEC INC.
022 B000005 13-3551367
022 C000005 10199758
022 D000005 73316
022 A000006 AUBREY LANSTON
022 B000006 13-5552129
<PAGE> PAGE 3
022 C000006 9966895
022 D000006 55257
022 A000007 NOMURA SECURITIES
022 B000007 13-2642206
022 C000007 7454810
022 D000007 0
022 A000008 DEUTSCHE BANK
022 B000008 13-2730828
022 C000008 5474379
022 D000008 72128
022 A000009 BEAR STEARNS & CO. INC.
022 B000009 13-3299429
022 C000009 5369000
022 D000009 0
022 A000010 SMITH BARNEY
022 B000010 13-1912900
022 C000010 3539000
022 D000010 0
023 C000000 159287732
023 D000000 410091
024 00AA00 N
025 D00AA01 0
025 D00AA02 0
025 D00AA03 0
025 D00AA04 0
025 D00AA05 0
025 D00AA06 0
025 D00AA07 0
025 D00AA08 0
026 A000000 N
026 B000000 Y
026 C000000 N
026 D000000 N
026 E000000 N
026 F000000 N
026 G010000 N
026 G020000 N
026 H000000 N
027 000000 Y
028 A01AA00 478098
028 A02AA00 2777
028 A03AA00 0
028 A04AA00 558520
028 B01AA00 495465
028 B02AA00 3361
028 B03AA00 0
028 B04AA00 439455
028 C01AA00 670160
028 C02AA00 3573
028 C03AA00 0
028 C04AA00 794415
<PAGE> PAGE 4
028 D01AA00 831891
028 D02AA00 2754
028 D03AA00 0
028 D04AA00 932984
028 E01AA00 774483
028 E02AA00 1952
028 E03AA00 0
028 E04AA00 641923
028 F01AA00 701928
028 F02AA00 5259
028 F03AA00 0
028 F04AA00 723367
028 G01AA00 3952025
028 G02AA00 19676
028 G03AA00 0
028 G04AA00 4090664
028 H00AA00 0
029 00AA00 N
030 A00AA00 0
030 B00AA00 0.00
030 C00AA00 0.00
031 A00AA00 0
031 B00AA00 0
032 00AA00 0
033 00AA00 0
034 00AA00 N
035 00AA00 0
036 B00AA00 0
037 00AA00 N
038 00AA00 0
039 00AA00 N
040 00AA00 N
041 00AA00 N
042 A00AA00 0
042 B00AA00 0
042 C00AA00 0
042 D00AA00 0
042 E00AA00 0
042 F00AA00 0
042 G00AA00 0
042 H00AA00 0
043 00AA00 0
044 00AA00 0
045 00AA00 Y
046 00AA00 N
047 00AA00 Y
048 00AA00 0.100
048 A01AA00 0
048 A02AA00 0.000
048 B01AA00 0
048 B02AA00 0.000
<PAGE> PAGE 5
048 C01AA00 0
048 C02AA00 0.000
048 D01AA00 0
048 D02AA00 0.000
048 E01AA00 0
048 E02AA00 0.000
048 F01AA00 0
048 F02AA00 0.000
048 G01AA00 0
048 G02AA00 0.000
048 H01AA00 0
048 H02AA00 0.000
048 I01AA00 0
048 I02AA00 0.000
048 J01AA00 0
048 J02AA00 0.000
048 K01AA00 0
048 K02AA00 0.000
049 00AA00 N
050 00AA00 N
051 00AA00 N
052 00AA00 N
053 A00AA00 Y
053 B00AA00 Y
053 C00AA00 N
054 A00AA00 Y
054 B00AA00 Y
054 C00AA00 Y
054 D00AA00 N
054 E00AA00 N
054 F00AA00 N
054 G00AA00 N
054 H00AA00 Y
054 I00AA00 N
054 J00AA00 Y
054 K00AA00 N
054 L00AA00 N
054 M00AA00 Y
054 N00AA00 N
054 O00AA00 Y
055 A00AA00 N
055 B00AA00 N
056 00AA00 N
057 00AA00 N
058 A00AA00 N
059 00AA00 Y
060 A00AA00 Y
060 B00AA00 Y
061 00AA00 10000000
062 A00AA00 Y
062 B00AA00 19.9
<PAGE> PAGE 6
062 C00AA00 0.0
062 D00AA00 80.2
062 E00AA00 0.0
062 F00AA00 0.0
062 G00AA00 0.0
062 H00AA00 0.0
062 I00AA00 0.0
062 J00AA00 0.0
062 K00AA00 0.0
062 L00AA00 0.0
062 M00AA00 0.0
062 N00AA00 0.0
062 O00AA00 0.0
062 P00AA00 0.0
062 Q00AA00 0.0
062 R00AA00 0.0
063 A00AA00 41
063 B00AA00 0.0
064 A00AA00 N
064 B00AA00 N
066 A00AA00 N
067 00AA00 N
068 A00AA00 N
068 B00AA00 N
069 00AA00 N
070 A01AA00 Y
070 A02AA00 Y
070 B01AA00 N
070 B02AA00 N
070 C01AA00 N
070 C02AA00 N
070 D01AA00 N
070 D02AA00 N
070 E01AA00 N
070 E02AA00 N
070 F01AA00 N
070 F02AA00 N
070 G01AA00 N
070 G02AA00 N
070 H01AA00 N
070 H02AA00 N
070 I01AA00 N
070 I02AA00 N
070 J01AA00 N
070 J02AA00 N
070 K01AA00 Y
070 K02AA00 N
070 L01AA00 N
070 L02AA00 N
070 M01AA00 N
070 M02AA00 N
<PAGE> PAGE 7
070 N01AA00 Y
070 N02AA00 N
070 O01AA00 Y
070 O02AA00 N
070 P01AA00 N
070 P02AA00 N
070 Q01AA00 N
070 Q02AA00 N
070 R01AA00 N
070 R02AA00 N
071 A00AA00 0
071 B00AA00 0
071 C00AA00 0
071 D00AA00 0
072 A00AA00 12
072 B00AA00 43993
072 C00AA00 0
072 D00AA00 0
072 E00AA00 0
072 F00AA00 812
072 G00AA00 117
072 H00AA00 0
072 I00AA00 66
072 J00AA00 79
072 K00AA00 0
072 L00AA00 28
072 M00AA00 12
072 N00AA00 76
072 O00AA00 0
072 P00AA00 0
072 Q00AA00 45
072 R00AA00 18
072 S00AA00 42
072 T00AA00 0
072 U00AA00 31
072 V00AA00 0
072 W00AA00 697
072 X00AA00 2023
072 Y00AA00 163
072 Z00AA00 42133
072AA00AA00 4
072BB00AA00 0
072CC01AA00 0
072CC02AA00 0
072DD01AA00 4744
072DD02AA00 37388
072EE00AA00 4
073 A01AA00 0.0520
073 A02AA00 0.0500
073 B00AA00 0.0000
073 C00AA00 0.0000
<PAGE> PAGE 8
074 A00AA00 1
074 B00AA00 785480
074 C00AA00 195096
074 D00AA00 0
074 E00AA00 0
074 F00AA00 0
074 G00AA00 0
074 H00AA00 0
074 I00AA00 0
074 J00AA00 0
074 K00AA00 0
074 L00AA00 1003
074 M00AA00 113
074 N00AA00 981693
074 O00AA00 0
074 P00AA00 123
074 Q00AA00 0
074 R01AA00 0
074 R02AA00 0
074 R03AA00 0
074 R04AA00 1482
074 S00AA00 0
074 T00AA00 980088
074 U01AA00 82915
074 U02AA00 897173
074 V01AA00 1.00
074 V02AA00 1.00
074 W00AA00 1.0003
074 X00AA00 205
074 Y00AA00 0
075 A00AA00 812220
075 B00AA00 0
076 00AA00 0.00
077 A000000 Y
077 B000000 Y
077 C000000 N
077 D000000 N
077 E000000 N
077 F000000 N
077 G000000 N
077 H000000 N
077 I000000 N
077 J000000 N
077 K000000 N
077 L000000 N
077 M000000 N
077 N000000 N
077 O000000 N
077 P000000 N
077 Q010000 N
077 Q020000 N
<PAGE> PAGE 9
077 Q030000 N
078 000000 N
080 A00AA00 NATIONAL UNION FIRE INSURANCE COMPANY OF PITT
080 C00AA00 1250
081 A00AA00 Y
081 B00AA00 1
082 A00AA00 N
082 B00AA00 0
083 A00AA00 N
083 B00AA00 0
084 A00AA00 N
084 B00AA00 0
085 A00AA00 Y
085 B00AA00 N
086 A010000 0
086 A020000 0
086 B010000 0
086 B020000 0
086 C010000 0
086 C020000 0
086 D010000 0
086 D020000 0
086 E010000 0
086 E020000 0
086 F010000 0
086 F020000 0
086 A01AA00 0
086 A02AA00 0
086 B01AA00 0
086 B02AA00 0
086 C01AA00 0
086 C02AA00 0
086 D01AA00 0
086 D02AA00 0
086 E01AA00 0
086 E02AA00 0
086 F01AA00 0
086 F02AA00 0
SIGNATURE JOSEPH CARUSONE
TITLE ASSISTANT VICE PRES
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000926898
<NAME> MILESTONE TREASURY OBLIGATIONS FUND
<SERIES>
<NUMBER> 011
<NAME> INSTITUTIONAL SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> NOV-30-1996
<PERIOD-END> NOV-30-1996
<INVESTMENTS-AT-COST> 980,575,530
<INVESTMENTS-AT-VALUE> 980,575,530
<RECEIVABLES> 1,002,914
<ASSETS-OTHER> 114,372
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 981,692,816
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,604,579
<TOTAL-LIABILITIES> 1,604,579
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 980,088,237
<SHARES-COMMON-STOCK> 897,173,143
<SHARES-COMMON-PRIOR> 229,158,586
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 980,088,237
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 43,992,828
<OTHER-INCOME> 0
<EXPENSES-NET> 1,860,211
<NET-INVESTMENT-INCOME> 42,132,617
<REALIZED-GAINS-CURRENT> 4,144
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 42,136,761
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (37,388,300)
<DISTRIBUTIONS-OF-GAINS> (3,571)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6,057,708,590
<NUMBER-OF-SHARES-REDEEMED> (5,413,511,051)
<SHARES-REINVESTED> 23,817,018
<NET-CHANGE-IN-ASSETS> 668,656,457
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 812,214
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,022,825
<AVERAGE-NET-ASSETS> 717,126,352
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.05
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (0.05)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.20
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000926898
<NAME> MILESTONE TREASURY OBLIGATIONS FUND
<SERIES>
<NUMBER> 010
<NAME> INVESTOR SHARES
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> NOV-30-1996
<PERIOD-END> NOV-30-1996
<INVESTMENTS-AT-COST> 980,575,530
<INVESTMENTS-AT-VALUE> 980,575,530
<RECEIVABLES> 1,002,914
<ASSETS-OTHER> 114,372
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 981,692,816
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,604,579
<TOTAL-LIABILITIES> 1,604,579
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 980,088,237
<SHARES-COMMON-STOCK> 82,915,094
<SHARES-COMMON-PRIOR> 82,273,194
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 980,088,237
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 43,992,828
<OTHER-INCOME> 0
<EXPENSES-NET> 1,860,211
<NET-INVESTMENT-INCOME> 42,132,617
<REALIZED-GAINS-CURRENT> 4,144
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 42,136,761
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (4,744,317)
<DISTRIBUTIONS-OF-GAINS> (573)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,119,656,967
<NUMBER-OF-SHARES-REDEEMED> (1,123,505,861)
<SHARES-REINVESTED> 4,490,794
<NET-CHANGE-IN-ASSETS> 668,656,457
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 812,214
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,022,825
<AVERAGE-NET-ASSETS> 95,093,454
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.05
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (0.05)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 0.45
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
[LETTERHEAD OF MCGLADREY & PULLEN, LLP]
The Board of Trustees and Shareholders
The Milestone Funds
In planning and performing our audit of the financial statements of the
Treasury Obligations Portfolio of The Milestone Funds for the year ended
November 30, 1996, we considered its internal control structure, including
procedures for safeguarding securities, in order to determine our auditing
procedures for the purpose of expressing our opinion on the financial
statements and to comply with the requirements of Form N-SAR, not to provide
assurance on the internal control structure.
The management of The Milestone Funds is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to assess the expected
benefits and related costs of internal control structure policies and
procedures. Two of the objectives of an internal control structure are to
provide management with reasonable, but not absolute, assurance that assets
are safeguarded against loss from unauthorized use or disposition and that
transactions are executed in accordance with management's authorization and
recorded properly to permit preparation of financial statements in conformity
with generally accepted accounting principles.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projection of any
evaluation of the structure to future periods is subject to the risk that it
may become inadequate because of changes in conditions or that the
effectiveness of its design and operation may deteriorate.
Our consideration of the internal control structure would not necessarily
disclose all matters in the internal control structure that might be material
weaknesses under standards established by the American Institute of Certified
Public Accountants. A material weakness is a condition in which the design or
operation of the specific internal control structure elements does not reduce
to a relatively low level the risk that errors or irregularities in amounts
that would be material in relation to the financial statements being audited
may occur and not be detected within a timely period by employees in the normal
course of performing their assigned functions. However, we noted no matters
involving the internal control structure, including procedures for safeguarding
securities, that we consider to be material weaknesses as defined above as of
November 30, 1996.
This report is intended solely for the information and use of management and
the Securities and Exchange Commission.
/s/ McGladrey & Pullen, LLP
New York, New York
January 14, 1997
