TEMPORARY INVESTMENT FUND INC, 497, 1996-02-05

TEMPORARY INVESTMENT FUND INC
497, 1996-02-05

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<PAGE> 1

TempFund
An Investment Portfolio Offered by
Temporary Investment Fund, Inc.

<TABLE>
<S> <C>
Bellevue Park Corporate Center For purchase and redemption orders only call:
400 Bellevue Parkway, Suite 100 800-441-7450 (in Delaware: 302-791-5350).
Wilmington, DE 19809 For yield information call: 800-821-6006
(TempFund shares code: 24; TempFund Dollar
shares code: 20).
For other information call: 800-821-7432.
</TABLE>

Temporary Investment Fund, Inc. (the "Company") is a no-load, diversified,
open-end investment company presently offering shares in two separate money
market portfolios. The shares described in this Prospectus represent interests
in the TempFund portfolio (the "Fund").

Fund shares may not be purchased by individuals directly, but institutional
investors may purchase shares for accounts maintained by individuals. In
addition to TempFund Shares, investors may purchase TempFund "Dollar" Shares
which accrue daily dividends in the same manner as TempFund Shares but bear all
fees payable by the Fund to institutional investors for certain services they
provide to the beneficial owners of such Shares. (See "Management of the
Fund--Service Organizations.")

PNC Institutional Management Corporation ("PIMC") and PNC Bank, National
Association ("PNC Bank") serve as the Fund's adviser and sub-adviser,
respectively. PFPC Inc. ("PFPC") and Provident Distributors, Inc. ("PDI") serve
as the Fund's administrators. PDI also serves as the Fund's distributor.

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

SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF OR GUARANTEED, ENDORSED,
OR OTHERWISE SUPPORTED BY PNC BANK CORP. OR ITS AFFILIATES, OR THE U.S.
GOVERNMENT, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY.
AN INVESTMENT IN THE FUND INVOLVES INVESTMENT RISKS, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL. THERE CAN BE NO ASSURANCE THAT IT WILL
BE ABLE TO MAINTAIN ITS NET ASSET VALUE OF $1.00 PER SHARE.

This Prospectus briefly sets forth certain information about the Fund that
investors should know before investing. Investors are advised to read this
Prospectus and retain it for future reference. Additional information about the
Fund, contained in a Statement of Additional Information currently dated January
26, 1996, has been filed with the Securities and Exchange Commission and is
available to investors without charge by calling the Fund at 800-821-7432. The
Statement of Additional Information, as amended from time to time, is
incorporated in its entirety by reference into this Prospectus.

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

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

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

January 26, 1996
<PAGE> 2

BACKGROUND AND EXPENSE INFORMATION

The Company was incorporated in Maryland on February 8, 1973 and commenced
operations of the Fund on October 10, 1973. The Fund presently offers two
separate classes of shares--TempFund Shares and TempFund Dollar Shares ("Dollar
Shares"). Shares of each class represent equal, pro rata interests in the Fund
and accrue daily dividends in the same manner except that Dollar Shares bear
fees payable by the Fund (at the rate of .25% per annum) to institutional
investors for services they provide to the beneficial owners of such shares.
(See "Management of the Fund--Service Organizations.")

EXPENSE SUMMARY

<TABLE>
<CAPTION>
TEMPFUND
TEMPFUND DOLLAR
SHARES SHARES
----------- -----------
<S> <C> <C> <C> <C>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees (net of waivers)........................... .08% .08%
Other Expenses............................................. .10% .35%
Administration Fees (net of waivers).................. .08% -- .08% --
Shareholder Servicing Fees............................ -- .25%
Miscellaneous......................................... .02% .02%
Total Fund Operating Expenses (net of waivers)............. .18% .43%
=== ===
</TABLE>

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

<TABLE>
<CAPTION>
EXAMPLE 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- --------------------------------------------------------------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000 investment,
assuming (1) a 5% annual return; and (2) redemption at the
end of each time period with respect to the following:
TempFund Shares: $2 $ 6 $10 $23
TempFund Dollar Shares: $4 $14 $24 $54
</TABLE>

THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR RATE OF RETURN. ACTUAL EXPENSES AND RATE OF RETURN MAY BE GREATER OR
LESSER THAN THOSE SHOWN.

The purpose of the foregoing table is to assist an investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. In addition, institutional investors may charge
fees for providing administrative services in connection with their customers'
investment in Dollar Shares. (For more complete descriptions of the various
costs and expenses, see "Management of the Fund" in this Prospectus and the
Statement of Additional Information and the financial statements and related
notes contained in the Statement of Additional Information.) For the fiscal year
ended September 30, 1995, management and administration fees were each .11% of
the Fund's average net assets. Total Fund operating expenses for TempFund Shares
and Dollar Shares for the fiscal year ended September 30, 1995 absent fee
waivers would have been .27% and .52%, respectively, of the Fund's average net
assets. The investment adviser and administrators may from time to time waive
the advisory and administration fees otherwise payable to them or may reimburse
the Fund for its operating expenses. The foregoing table reflects anticipated
waivers and the expense information has been restated to reflect current fees.
The foregoing table has not been audited by the Fund's independent accountants.

2
<PAGE> 3

FINANCIAL HIGHLIGHTS

The following financial highlights for TempFund Shares have been derived
from the financial statements of the Fund for the fiscal year ended September
30, 1995, and for each of the nine preceding fiscal years, and for TempFund
Dollar Shares for the fiscal year ended September 30, 1995 and for each of the
eight preceding fiscal years and the fiscal period ended September 30, 1986
(commencement of operations). The financial highlights for the fiscal years
ended September 30, 1995, 1994, 1993, 1992 and 1991 have been audited by Coopers
& Lybrand L.L.P., independent accountants, whose report on the financial
statements and financial highlights of the Fund is included in the Statement of
Additional Information. The tables should be read in conjunction with the
financial statements and related notes included in the Statement of Additional
Information. Further information about the performance of the Fund is available
in the annual report to shareholders, which may be obtained by calling (800)
821-7432.

TEMPFUND SHARES
The table below sets forth selected financial data for a TempFund Share
outstanding throughout each year presented.
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
----------------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989
---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Year.............................. $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
---------- ---------- ---------- ---------- ---------- ---------- ----------
Income From Investment Operations
Net Investment Income............. .0567 .0360 .0310 .0424 .0667 .0815 .0896
Net Realized Gains on
Investments..................... -- -- -- .0015 -- -- --
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total From Investment
Operations...................... .0567 .0360 .0310 .0439 .0667 .0815 .0896
---------- ---------- ---------- ---------- ---------- ---------- ----------
Less Distributions
Dividends (From Net Investment
Income)......................... (.0567) (.0360) (.0310) (.0424) (.0667) (.0815) (.0896)
Distributions (From Capital
Gains).......................... -- -- -- (.0015) -- -- --
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Distributions............... (.0567) (.0360) (.0310) (.0439) (.0667) (.0815) (.0896)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Asset Value, End of Year....... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
========== ========== ========== ========== ========== ========== ==========
Total Return...................... 5.82% 3.66% 3.14% 4.48% 6.87% 8.47% 9.34%
Ratios/Supplemental Data
Net Assets, End of Year (000).....$5,351,346 $4,480,851 $5,522,056 $9,227,572 $8,888,832 $4,857,260 $5,265,850
Ratio of Expenses to Average Daily
Net Assets...................... .24%(1) .25%(1) .21% .21% .27% .30% .30%
Ratio of Net Investment Income to
Average Daily Net Assets........ 5.67% 3.60% 3.10% 4.13% 6.53% 8.16% 8.96%

<CAPTION>
YEAR ENDED SEPTEMBER 30,
--------------------------------------
1988 1987 1986
---------- ---------- ----------
<S> <C> <C> <C>
Net Asset Value, Beginning of
Year.............................. $1.00 $1.00 $1.00
---------- ---------- ----------
Income From Investment Operations
Net Investment Income............. .0707 .0609 .0712
Net Realized Gains on
Investments..................... -- -- --
---------- ---------- ----------
Total From Investment
Operations...................... .0707 .0609 .0712
---------- ---------- ----------
Less Distributions
Dividends (From Net Investment
Income)......................... (.0707) (.0609) (.0712)
Distributions (From Capital
Gains).......................... -- -- --
---------- ---------- ----------
Total Distributions............... (.0707) (.0609) (.0712)
---------- ---------- ----------
Net Asset Value, End of Year....... $1.00 $1.00 $1.00
========== ========== ==========
Total Return...................... 7.31% 6.29% 7.29%
Ratios/Supplemental Data
Net Assets, End of Year (000)..... $4,583,277 $5,267,851 $6,836,834
Ratio of Expenses to Average Daily
Net Assets...................... .28% .28% .28%
Ratio of Net Investment Income to
Average Daily Net Assets........ 7.02% 6.06% 7.00%
</TABLE>

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

(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets for TempFund Shares would have been
.27% for the years ended September 30, 1995 and 1994, respectively.

3
<PAGE> 4

TEMPFUND DOLLAR SHARES

The table below sets forth selected financial data for a TempFund Dollar Share
outstanding throughout each period presented.
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
-----------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989
------- -------- -------- -------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period............................. $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------- -------- -------- -------- ------- ------- --------
Income From Investment Operations
Net Investment Income.............. .0542 .0335 .0285 .0399 .0642 .0790 .0871
Net Realized Gains on
Investments...................... -- -- -- .0015 -- -- --
------- -------- -------- -------- ------- ------- --------
Total From Investment Operations... .0542 .0335 .0285 .0414 .0642 .0790 .0871
------- -------- -------- -------- ------- ------- --------
Less Distributions
Dividends (From Net Investment
Income).......................... (.0542) (.0335) (.0285) (.0399) (.0642) (.0790) (.0871)
Distributions (From Capital
Gains)........................... -- -- -- (.0015) -- -- --
------- -------- -------- -------- ------- ------- --------
Total Distributions................ (.0542) (.0335) (.0285) (.0414) (.0642) (.0790) (.0871)
------- -------- -------- -------- ------- ------- --------
Net Asset Value, End of Period...... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======= ======== ======== ======== ======= ======= ========
Total Return....................... 5.57% 3.41% 2.89% 4.23% 6.62% 8.22% 9.09%
Ratios/Supplemental Data
Net Assets, End of Period (000).... $81,828 $102,105 $112,695 $217,230 $44,667 $73,968 $101,989
Ratio of Expenses to Average Daily
Net Assets....................... .49%(3) .50%(3) .46% .46% .52% .55% .55%
Ratio of Net Investment Income to
Average Daily Net Assets......... 5.42% 3.35% 2.85% 3.88% 6.28% 7.91% 8.71%

<CAPTION>
NOVEMBER 21,
YEAR ENDED 1985(1)
SEPTEMBER 30, TO
------------------- SEPTEMBER 30,
1988 1987 1986
------- ------- -----------------
<S> <<C> <C> <C>
Net Asset Value, Beginning of
Period............................. $1.00 $1.00 $1.00
------- ------- ------
Income From Investment Operations
Net Investment Income.............. .0682 .0584 .0557
Net Realized Gains on
Investments...................... -- -- --
------- ------- ------
Total From Investment Operations... .0682 .0584 .0557
------- ------- ------
Less Distributions
Dividends (From Net Investment
Income).......................... (.0682) (.0584) (.0557)
Distributions (From Capital
Gains)........................... -- -- --
------- ------- ------
Total Distributions................ (.0682) (.0584) (.0557)
------- ------- ------
Net Asset Value, End of Period...... $1.00 $1.00 $1.00
======= ======= =======
Total Return....................... 7.06% 6.04% 7.04%(2)
Ratios/Supplemental Data
Net Assets, End of Period (000).... $65,077 $37,746 $ 3,657
Ratio of Expenses to Average Daily
Net Assets....................... .53% .53% .53%(2)
Ratio of Net Investment Income to
Average Daily Net Assets......... 6.77% 5.81% 6.75%(2)
</TABLE>

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

(1) First issuance of Dollar Shares.

(2) Annualized.

(3) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets for TempFund Dollar Shares would have
been .52% for the years ended September 30, 1995 and 1994, respectively.

4
<PAGE> 5

INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is to seek current income and stability of
principal. Portfolio obligations held by the Fund have remaining maturities of
397 days (thirteen months) or less (with certain exceptions), subject to the
quality, diversification, and other requirements of Rule 2a-7 under the
Investment Company Act of 1940, as amended (the "1940 Act") and other rules of
the Securities and Exchange Commission (the "SEC"). The Fund will limit its
purchases of any one issuer's securities (other than U.S. Government
obligations) to 5% of the Fund's total assets, except that up to 25% of its
total assets may be invested in securities of one issuer for a period of up to
three business days. In pursuing its investment objective, the Fund invests in a
broad range of money market instruments, including government, bank and
commercial obligations that may be available in the money markets. The following
descriptions illustrate the types of instruments in which the Fund invests.

With respect to the types of instruments in which the Fund may invest, the
Fund will purchase only "First Tier Eligible Securities" (as defined by the SEC)
that present minimal credit risks as determined by the investment adviser
pursuant to guidelines approved by the Company's Board of Directors. First Tier
Eligible Securities consist of securities that either (a) have ratings at the
time of purchase in the highest rating category by at least two unaffiliated
nationally recognized statistical rating organizations ("NRSROs") (or one NRSRO
if the security was rated by only one NRSRO), or (b) are issued by insurers with
such ratings. Unrated instruments (including instruments with long-term but no
short-term ratings) purchased by the Fund will be of comparable quality as
determined by the investment adviser pursuant to guidelines approved by the
Board of Directors. Additionally, securities purchased by the Fund (or the
issuers thereof) will be rated at the time of purchase in the highest rating
category by either Standard & Poor's Ratings Group or Moody Investors Service,
Inc., and no such security will be rated less than the highest rating category
(e.g. less than "A-1" by Standard & Poor's or "Prime-1" by Moody) by any NRSRO.
A description of applicable NRSRO ratings is in the Appendix to the Statement of
Additional Information.

The Fund may purchase obligations issued or guaranteed by the U.S.
Government or its agencies and instrumentalities. Obligations of certain
agencies and instrumentalities of the U.S. Government are backed by the full
faith and credit of the United States. Others are backed by the right of the
issuer to borrow from the U.S. Treasury or are backed only by the credit of the
agency or instrumentality issuing the obligation. Securities issued or
guaranteed by the U.S. Government, its agencies and instrumentalities have
historically involved little risk of loss of principal if held to maturity.
However, due to fluctuations in interest rates, the market value of such
securities may vary during the period a shareholder owns shares of the Fund.
Certain government securities held by the Fund may have remaining maturities
exceeding thirteen months if such securities provide for adjustments in their
interest rates not less frequently than every thirteen months. To the extent
consistent with its investment objectives, the Fund may invest in Treasury
receipts and other "stripped" securities issued or guaranteed by the U.S.
Government, where the principal and interest components are traded independently
under the Separate Trading of Registered Interest and Principal of Securities
program ("STRIPS"). Under the STRIPS program, the principal and interest
components are individually numbered and separately issued by the U.S. Treasury
at the request of depository financial institutions, which then trade the
component parts independently. Currently, the Fund only invests in "stripped"
securities issued or guaranteed by the U.S. Government which are registered
under the STRIPS program. The principal and interest components may exhibit
greater price volatility than ordinary debt securities because of the manner in
which their principal and interest are returned to investors.

5
<PAGE> 6

The Fund may purchase bank obligations such as certificates of deposit and
bankers' acceptances issued or supported by the credit of domestic banks or
savings institutions having total assets at the time of purchase in excess of $1
billion. The Fund may also make interest-bearing savings deposits in commercial
and savings banks in amounts not in excess of 5% of the Fund's assets.

The Fund may invest in commercial paper, short-term notes and corporate
bonds of domestic corporations that meet the Fund's quality and maturity
requirements.

The Fund may purchase variable or floating rate notes, which are unsecured
instruments that provide for adjustments in the interest rate on certain reset
dates or whenever a specified interest rate index changes, respectively. Such
notes may not be actively traded in a secondary market, but, in some cases, the
Fund may be entitled to payment of principal on demand and may be able to
re-sell such notes in the dealer market. Variable and floating notes are not
typically rated by credit rating agencies, but their issuers must satisfy the
same criteria as set forth above for issuers of commercial paper. If an issuer
of such a note were to default on its payment obligation, the Fund might be
unable to dispose of the note because of the absence of an active secondary
market and might, for this or other reasons, suffer a loss to the extent of the
default. The Fund invests in variable or floating rate notes only when the
investment adviser deems the investment to involve minimal credit risk. Variable
and floating rate notes that do not provide for settlement within seven days may
be deemed illiquid and subject to the 10% limitation on such investments.

The Fund may purchase money market instruments from financial institutions,
such as banks and broker-dealers, subject to the seller's agreement to
repurchase them at an agreed upon time and price ("repurchase agreements"). The
securities subject to a repurchase agreement may bear maturities exceeding
thirteen months, provided the repurchase agreement itself matures in one year or
less. The seller under a repurchase agreement will be required to maintain the
value of the securities subject to the agreement at not less than the repurchase
price. Default by the seller would, however, expose the Fund to possible loss
because of adverse market action or delay in connection with the disposition of
the underlying obligations.

The Fund may also purchase securities on a "when-issued" basis. When-issued
securities are securities purchased for delivery beyond the normal settlement
date at a stated price and yield. The Fund will generally not pay for such
securities or start earning interest on them until they are received. Securities
purchased on a when-issued basis are recorded as an asset and are subject to
changes in value based upon changes in the general level of interest rates. The
Fund expects that commitments to purchase when-issued securities will not exceed
25% of the value of its total assets absent unusual market conditions. The Fund
does not intend to purchase when-issued securities for speculative purposes but
only in furtherance of its investment objective.

In addition, the Fund may, when deemed appropriate by its investment
adviser in light of the Fund's investment objective, invest in high quality,
short-term obligations issued by state and local governmental issuers which
carry yields that are competitive with those of other types of money market
instruments of comparable quality.

The Fund will not knowingly invest more than 10% of the value of its total
assets in illiquid securities, including time deposits and repurchase agreements
having maturities longer than seven days. Securities that have readily available
market quotations are not deemed illiquid for purposes of this limitation. (See
"Investment Objectives and Policies--Illiquid Securities" in the Statement of
Additional Information.)

6
<PAGE> 7

INVESTMENT LIMITATIONS

The Fund's investment objective and the policies described above are not
fundamental and may be changed by the Company's Board of Directors without a
vote of shareholders. If there is a change in the investment objective,
shareholders should consider whether the Fund remains an appropriate investment
in light of their then current financial position and needs. The Fund's
investment limitations summarized below may not be changed without the
affirmative vote of the holders of a majority of its outstanding shares. (A
complete list of the investment limitations that cannot be changed without a
vote of shareholders is contained in the Statement of Additional Information
under "Investment Objectives and Policies.")

THE FUND MAY NOT:

1. Purchase any securities other than so-called money market
instruments, some of which may be subject to repurchase agreements, but the
Fund may make interest-bearing savings deposits in amounts not in excess of
5% of the value of the Fund's assets.

2. Borrow money, except from banks for temporary purposes and then in
amounts not in excess of 10% of the value of the Fund's assets at the time
of such borrowing; or pledge any assets except in connection with any such
borrowing and in amounts not in excess of the lesser of the dollar amounts
borrowed or 10% of the value of the Fund's assets at the time of such
borrowing.

3. Purchase any securities which would cause 25% or more of the value
of its total assets at the time of purchase to be invested in the
securities of issuers conducting their principal business activities in the
same industry, provided that there is no limitation with respect to
investments in federal government obligations or certain bank obligations.

4. Purchase securities of any one issuer, other than the federal
government, if immediately after such purchase more than 5% of the value of
its total assets would be invested in such issuer, except that up to 25% of
the value of the Fund's total assets may be invested without regard to such
5% limitation.

PURCHASE AND REDEMPTION OF SHARES

PURCHASE PROCEDURES

Fund shares are sold at the net asset value per share next determined after
receipt of a purchase order by PFPC, the Fund's transfer agent. Purchase orders
for shares are accepted only on days on which both the New York Stock Exchange
and the Federal Reserve Bank of Philadelphia are open for business (a "Business
Day") and must be transmitted to PFPC in Wilmington, Delaware by telephone
(800-441-7450; in Delaware: 302-791-5350) or through the Fund's computer access
program. Orders received before 12:00 noon, Eastern time, for which payment has
been received by PNC Bank, the Fund's custodian, will be executed at 12:00 noon.
Orders received after 12:00 noon and before 3:00 P.M., Eastern time (or orders
received earlier in the same day for which payment has not been received by
12:00 noon), will be executed at 4:00 P.M., Eastern time, if payment has been
received by PNC Bank by that time. Orders received at other times, and orders
for which payment has not been received by 4:00 P.M., Eastern time, will not be
accepted, and notice thereof will be given to the institution placing the order.
(Payment for orders which are not received or accepted will be returned

7
<PAGE> 8

after prompt inquiry to the sending institution.) The Fund may in its discretion
reject any order for shares.

Payment for Fund shares may be made only in federal funds or other funds
immediately available to PNC Bank. The minimum initial investment by an
institution is $3 million for TempFund Shares and $5,000 for Dollar Shares;
however, broker-dealers and other institutional investors may set a higher
minimum for their customers. There is no minimum subsequent investment. The
Fund, at its discretion, may reduce the minimum initial investment for TempFund
Shares for specific institutions whose aggregate relationship with the Provident
Institutional Funds is substantially equivalent to this $3 million minimum and
warrants this reduction.

Conflict of interest restrictions may apply to an institution's receipt of
compensation paid by the Fund in connection with the investment of fiduciary
funds in Dollar Shares. (See also "Management of the Funds--Service
Organizations"). Institutions, including banks regulated by the Comptroller of
the Currency and investment advisers and other money managers subject to the
jurisdiction of the SEC, the Department of Labor or state securities
commissions, are urged to consult their legal advisors before investing
fiduciary funds in Dollar Shares. (See also "Management of the Fund--Banking
Laws.")

REDEMPTION PROCEDURES

Redemption orders must be transmitted to PFPC in Wilmington, Delaware in
the manner described under "Purchase Procedures." Shares are redeemed at the net
asset value per share next determined after PFPC's receipt of the redemption
order. While the Fund intends to use its best efforts to maintain its net asset
value per share at $1.00, the proceeds paid to a shareholder upon redemption may
be more or less than the amount invested depending upon a share's net asset
value at the time of redemption.

Payment for redeemed shares for which a redemption order is received by
PFPC by 3:00 P.M., Eastern time, on a Business Day is normally made in federal
funds wired to the redeeming shareholder on the same day. Payment for redemption
orders which are received between 3:00 P.M. and 4:00 P.M., Eastern time, or on a
day when PNC Bank is closed, is normally wired in federal funds on the next day
following redemption that PNC Bank is open for business.

The Fund shall have the right to redeem shares in any TempFund Shares
account if the value of the account is less than $100,000, and in any TempFund
Dollar Shares account if the value of the account is less than $1,000, after
sixty-days' prior written notice to the shareholder. Any such redemption shall
be effected at the net asset value next determined after the redemption order is
entered. If during the sixty-day period the shareholder increases the value of
its TempFund Shares account to $100,000 or more or its TempFund Dollar Shares
account to $1,000 or more, no such redemption shall take place. In addition, the
Fund may also redeem shares involuntarily under certain special circumstances
described in the Statement of Additional Information under "Additional Purchase
and Redemption Information."

OTHER MATTERS

8
<PAGE> 9

Exchange are closed). Currently, one or both of these institutions are closed on
the customary national business holidays of New Year's Day, Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day (observed), Independence
Day, Labor Day, Columbus Day (observed), Veterans' Day, Thanksgiving Day, and
Christmas Day. The net asset value per share of Fund shares is calculated by
adding the value of all securities and other assets of the Fund, subtracting
liabilities, and dividing the result by the total number of the Fund's
outstanding shares (irrespective of class or sub-class). In computing net asset
value, the Fund uses the amortized cost method of valuation as described in the
Statement of Additional Information under "Additional Purchase and Redemption
Information." The Fund's net asset value per share for purposes of pricing
purchase and redemption orders is determined independently of the net asset
value of the Company's TempCash portfolio.

Fund shares are sold and redeemed without charge by the Fund. Institutional
investors purchasing or holding Fund shares for their customer accounts may
charge customer fees for cash management and other services provided in
connection with their accounts. A customer should, therefore, consider the terms
of its account with an institution before purchasing Fund shares. An institution
purchasing or redeeming Fund shares on behalf of its customers is responsible
for transmitting orders to the Fund in accordance with its customer agreements.

MANAGEMENT OF THE FUND

BOARD OF DIRECTORS

The business and affairs of the Fund are managed under the direction of the
Company's Board of Directors. The directors of the Company are as follows:

Philip E. Coldwell is an economic consultant and a former Member of
the Board of Governors of the Federal Reserve System.

Robert R. Fortune is a financial consultant and former Chairman,
President, and Chief Executive Officer of Associated Electric & Gas
Insurance Services Limited.

Rodney D. Johnson is President of Fairmount Capital Advisors, Inc.

G. Willing Pepper, Chairman of the Board and President of the Company,
is a retired President of Scott Paper Company.

Mr. Pepper is considered by the Company to be an "interested person" of the
Company as defined in the 1940 Act.

The other officers of the Company are as follows:

Edward J. Roach is Vice President and Treasurer of the Company.

W. Bruce McConnel, III, Secretary of the Company, is a partner of the
law firm of Drinker Biddle & Reath, Philadelphia, Pennsylvania.

INVESTMENT ADVISER AND SUB-ADVISER

PIMC, a wholly-owned indirect subsidiary of PNC Bank, serves as the Fund's
investment adviser. PIMC was organized in 1977 by PNC Bank to perform advisory
services for investment companies and

9
<PAGE> 10

has its principal offices at Bellevue Park Corporate Center, 400 Bellevue
Parkway, Wilmington, Delaware 19809. PNC Bank serves as the Fund's sub-adviser.
PNC Bank is one of the largest bank managers of investments for individuals in
the United States, and together with its predecessors has been in the business
of managing the investments of fiduciary and other accounts since 1847. PNC Bank
is a wholly-owned, indirect subsidiary of PNC Bank Corp., and has principal
offices at Broad and Chestnut Streets, Philadelphia, Pennsylvania 19102. PNC
Bank Corp. is a multi-bank holding company. PIMC and PNC Bank also serve as
adviser and sub-adviser, respectively, to the Company's TempCash portfolio.

PNC Bank Corp., headquartered in Pittsburgh, Pennsylvania, is one of the
largest financial services organizations in the United States, with banking
subsidiaries in Pennsylvania, New Jersey, Delaware, Ohio, Kentucky, Indiana,
Massachusetts and Florida. Its major businesses include corporate banking,
consumer banking, mortgage banking and asset management.

PNC Financial Services Group is PNC Bank Corp.'s mutual fund complex,
headquartered in Wilmington, Delaware. This group includes PIMC, PFPC Inc. and
PNC Bank. In 1973, Provident National Bank (predecessor to PNC Bank) commenced
advising the first institutional money market mutual fund--a U.S.
dollar-denominated constant net asset value fund--offered in the United States.

The PNC Financial Services Group is one of the largest U.S. bank managers
of mutual funds, with assets currently under management in excess of $30
billion. This group, through PFPC Inc. and PFPC International Ltd., is also a
leading mutual fund service provider, having contractual relationships with
approximately 370 mutual funds with 3.5 million shareholders and in excess of
$101 billion in assets, including some $2 billion in non-U.S. assets.
Additionally, this group, through its PNC Institutional Investment Service,
provides investment research to some 250 financial institutions located in the
United States and abroad. PNC Bank provides custodial services for approximately
$210 billion in assets, including approximately $160 billion in mutual fund
assets.

As adviser, PIMC manages the Fund's portfolio and is responsible for all
purchases and sales of the Fund's portfolio securities. PIMC also maintains
certain of the Fund's financial accounts and records and computes the Fund's net
asset value and net income. For the advisory services provided and expenses
assumed by it, PIMC is entitled to receive a fee, computed daily and payable
monthly, based on the Fund's average net assets. PIMC and the administrators may
from time to time reduce the advisory and administration fees otherwise payable
to them or may reimburse the Fund for its operating expenses. Any fees waived
and any expenses reimbursed by PIMC and the administrators with respect to a
particular fiscal year are not recoverable. For the fiscal year ended September
30, 1995, the Fund paid investment advisory fees aggregating .11% of its average
net assets.

As sub-adviser, PNC Bank provides research, credit analysis and
recommendations with respect to the Fund's investments and supplies PIMC with
certain computer facilities, personnel and other services. For its sub-advisory
services, PNC Bank is entitled to receive from PIMC an amount equal to 75% of
the advisory fee paid by the Fund to PIMC (subject to adjustment in certain
circumstances). The sub-advisory fees paid by PIMC to PNC Bank have no effect on
the advisory fees payable by the Fund to PIMC. PNC Bank also serves as the
Fund's custodian. The services provided by PNC Bank and PIMC and the fees
payable by the Fund for these services are described further in the Statement of
Additional Information under "Management of the Fund."

10
<PAGE> 11

ADMINISTRATORS

PFPC Inc. ("PFPC"), whose principal business address is 400 Bellevue
Parkway, Wilmington, Delaware 19809, and Provident Distributors, Inc. ("PDI"),
whose principal business address is 259 Radnor-Chester Road, Suite 120, Radnor,
Pennsylvania 19087, serve as administrators. PFPC is an indirect wholly-owned
subsidiary of PNC Bank Corp. A majority of the outstanding stock of PDI is owned
by its officers. The administrative services provided by the administrators,
which are described more fully in the Statement of Additional Information,
include providing and supervising the operation of an automated data processing
system to process purchase and redemption orders; assisting in maintaining the
Fund's Wilmington, Delaware office; performing administrative services in
connection with the Fund's computer access program maintained to facilitate
shareholder access to the Fund; accumulating information for and coordinating
the preparation of reports to the Fund's shareholders and the SEC; and,
maintaining the registration or qualification of the Fund's shares for sale
under state securities laws. PFPC and PDI are jointly and severally responsible
for carrying out the duties undertaken pursuant to the Administration Agreement
with the Fund.

For their administrative services, the administrators are entitled jointly
to receive a fee, computed daily and payable monthly. (For information regarding
the administrators' administrative fee waivers and expense reimbursements, see
"Investment Adviser and Sub-Adviser" above.) The Fund also reimburses each
administrator for its reasonable out-of-pocket expenses incurred in connection
with the Fund's computer access program. For the fiscal year ended September 30,
1995, the Fund paid administration fees aggregating .11% of its average net
assets.

PFPC also serves as transfer agent, registrar and dividend disbursing
agent. PFPC's address is P.O. Box 8950, Wilmington, Delaware 19885-9628. The
services provided by PFPC and PDI and the fees payable by the Fund for these
services are described further in the Statement of Additional Information under
"Management of the Funds."

THE DISTRIBUTOR

PDI serves as distributor of the Fund's shares. Its principal offices are
located at 259 Radnor-Chester Road, Suite 120, Radnor, Pennsylvania 19087. Fund
shares are sold on a continuous basis by the distributor as agent. The
distributor pays the cost of printing and distributing prospectuses to persons
who are not shareholders of the Fund (excluding preparation and printing
expenses necessary for the continued registration of the Fund's shares) and of
printing and distributing all sales literature. No compensation is payable by
the Fund to the distributor for its distribution services.

SERVICE ORGANIZATIONS

11
<PAGE> 12

from customers and placing net purchase and redemption orders with PFPC;
processing dividend payments from the Fund on behalf of customers; providing
information periodically to customers showing their positions in Dollar Shares;
and providing sub-accounting or the information necessary for sub-accounting
with respect to Dollar Shares beneficially owned by customers. Under the terms
of the agreements, Service Organizations are required to provide to their
customers a schedule of any fees that they may charge customers in connection
with their investments in Dollar Shares. TempFund Shares are sold to
institutions that have not entered into servicing agreements with the Fund in
connection with their investments.

EXPENSES

Except as noted above and in the Statement of Additional Information, the
Fund's service contractors bear all expenses in connection with the performance
of their services. Similarly, the Fund bears the expenses incurred in its
operations. For the fiscal year ended September 30, 1995, the Fund's total
expenses with respect to TempFund Shares were .24% of the average net assets of
the TempFund Shares and with respect to Dollar Shares were .49% of the average
net assets of the Dollar Shares. With regard to fees paid exclusively by Dollar
Shares, see "Service Organizations" above.

BANKING LAWS

Banking laws and regulations presently prohibit a bank holding company
registered under the Federal Bank Holding Company Act of 1956 or any bank or
non-bank affiliate thereof from sponsoring, organizing, or controlling a
registered, open-end investment company engaged continuously in the issuance of
its shares and prohibit banks generally from issuing, underwriting, selling or
distributing securities such as Fund shares. Such banking laws and regulations
do not prohibit such a holding company or affiliate or banks generally from
acting as investment adviser, transfer agent or custodian to such an investment
company or from purchasing shares of such a company for or upon the order of
customers. PNC Bank, PIMC and PFPC, as well as some Service Organizations, are
subject to such banking laws and regulations, but believe they may perform the
services for the Fund contemplated by their respective agreements, this
Prospectus and the Statement of Additional Information without violating
applicable banking laws or regulations.

Should future legislative, judicial, or administrative action prohibit or
restrict the activities of bank Service Organizations in connection with the
provision of support services to their customers, the Fund might be required to
alter or discontinue its arrangements with Service Organizations and change its
method of operations with respect to Dollar Shares. It is not anticipated,
however, that any change in the Fund's method of operations would affect its net
asset value per share or result in a financial loss to any customer.

DIVIDENDS

Shareholders of the Fund are entitled to dividends and distributions
arising only from the net investment income and capital gains, if any, earned on
investments held by the Fund. The Fund's net investment income is declared daily
as a dividend to shares held of record at the close of business on the day of
declaration. Shares begin accruing dividends on the day the purchase order for
the shares is effected and continue to accrue dividends through the day before
such shares are redeemed. Dividends are paid monthly by check, or by wire
transfer if requested in writing by the shareholder, within five business days
after the end of the month or within five business days after a redemption of

12
<PAGE> 13

all of a shareholder's shares of a particular class. The Fund does not expect to
realize net long-term capital gains.

Dividends are determined in the same manner for each class of shares of the
Fund. Dollar Shares bear all the expense of fees paid to Service Organizations,
and as a result, at any given time, the dividend on Dollar Shares will be
approximately .25% lower than the dividend on TempFund Shares.

Institutional shareholders may elect to have their dividends reinvested in
additional full and fractional shares of the same class of shares with respect
to which such dividends are declared at the net asset value of such shares on
the payment date. Reinvested dividends receive the same tax treatment as
dividends paid in cash. Such election, or any revocation thereof, must be made
in writing to PFPC, the Fund's transfer agent, at P.O. Box 8950, Wilmington,
Delaware 19885-9628 and will become effective after its receipt by PFPC with
respect to dividends paid.

PFPC, as transfer agent, will send each Fund shareholder or its authorized
representative an annual statement designating the amount, if any, of any
dividends and distributions made during each year and their federal tax
qualification.

TAXES

The Fund qualified in its last taxable year and intends to qualify in
future years as a "regulated investment company" under the Internal Revenue Code
of 1986, as amended (the "Code"). A regulated investment company generally is
exempt from federal income tax on amounts distributed to its shareholders.

Qualification as a regulated investment company under the Code for a
taxable year requires, among other things, that the Fund distribute to its
shareholders at least 90% of its investment company taxable income for such
year. In general, the Fund's investment company taxable income will be its
taxable income (including dividends and short-term capital gains, if any)
subject to certain adjustments and excluding the excess of any net long-term
capital gain for the taxable year over any net short-term capital loss for such
year. The Fund intends to distribute substantially all of its investment company
taxable income each year. Such distributions will be taxable as ordinary income
to Fund shareholders which are not currently exempt from federal income taxes,
whether such income is received in cash or reinvested in additional shares.
(Federal income taxes for distributions to an IRA or a qualified retirement plan
are deferred under the Code.) It is anticipated that none of the Fund's
distributions will be eligible for the dividends received deduction for
corporations. The Fund does not expect to realize long-term capital gains and,
therefore, does not contemplate payment of any "capital gain dividends" as
described in the Code.

Dividends declared in October, November, or December of any year payable to
shareholders of record on a specified date in such months will be deemed to have
been received by the shareholders and paid by the Fund on December 31 of such
year in the event such dividends are actually paid during January of the
following year.

The foregoing discussion is only a brief summary of some of the important
federal tax considerations generally affecting the Fund and its shareholders. As
noted above, IRAs receive special tax treatment. No attempt is made to present a
detailed explanation of the federal, state or local income tax treatment of the
Fund or its shareholders, and this discussion is not intended as a substitute

13
<PAGE> 14

for careful tax planning. Accordingly, potential investors in the Fund should
consult their tax advisors with specific reference to their own tax situation.

YIELDS

From time to time, in advertisements or in reports to shareholders, the
"yields" and "effective yields" for TempFund Shares and Dollar Shares may be
quoted. Yield quotations are computed separately for TempFund Shares and
TempFund Dollar Shares. The "yield" for a particular class or sub-class of Fund
shares refers to the income generated by an investment in such shares over a
specified period (such as a seven-day period). This income is then "annualized";
that is, the amount of income generated by the investment during that period is
assumed to be generated for each such period over a 52-week or one-year period
and is shown as a percentage of the investment. The "effective yield" is
calculated similarly but, when annualized, the income earned by an investment in
a particular class or sub-class is assumed to be reinvested. The "effective
yield" will be slightly higher than the "yield" because of the compounding
effect of this assumed reinvestment.

The Fund's yields may be compared to those of other mutual funds with
similar objectives, to stock or other relevant indices, or to rankings prepared
by independent services or other financial or industry publications that monitor
the performance of mutual funds. For example, such data is reported in national
financial publications such as IBC/Donoghue's Money Fund Report(R), The Wall
Street Journal, and The New York Times, reports prepared by Lipper Analytical
Services, Inc., and publications of a local or regional nature.

The Fund's yield figures for TempFund Shares and Dollar Shares represent
the Fund's past performance, will fluctuate, and should not be considered as
representative of future results. The yield of any investment is generally a
function of portfolio quality and maturity, type of investment, and operating
expenses. Any fees charged by Service Organizations or other institutional
investors directly to their customers in connection with investments in Fund
shares are not reflected in the Fund's yields; and, such fees, if charged, would
reduce the actual return received by customers on their investments. The methods
used to compute the Fund's yields are described in more detail in the Statement
of Additional Information. Investors may call (800) 821-6006 (TempFund Shares
code: 24; TempFund Dollar Shares code: 20) to obtain current yield information.

DESCRIPTION OF SHARES AND MISCELLANEOUS

The Company has authorized capital of 60 billion shares of Common Stock,
$.001 par value per share, of which 40 billion shares are classified as Class B
Common Stock, 5 billion shares are classified as Class B--Special Series 1
Common Stock, 5 billion shares are classified as Class C Common Stock and 10
billion shares are classified as Class C--Special Series 1 Common Stock. Shares
of Class C Common Stock and Class C--Special Series 1 Common Stock represent
interests in the Company's TempCash portfolio. Shares of Class B Common Stock
and Class B--Special Series 1 Common Stock (also known as "Dollar Shares")
represent interests in the TempFund portfolio. Under the Company's charter, the
Board of Directors has the power to classify or reclassify any unissued shares
of Common Stock into one or more classes or sub-classes.

14
<PAGE> 15

THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL INFORMATION INCORPORATED
HEREIN RELATE PRIMARILY TO THE FUND AND DESCRIBE ONLY THE INVESTMENT OBJECTIVE
AND POLICIES, OPERATIONS, CONTRACTS, AND OTHER MATTERS RELATING TO THE FUND.
INVESTORS WISHING TO OBTAIN SIMILAR INFORMATION REGARDING THE COMPANY'S TEMPCASH
PORTFOLIO MAY OBTAIN SEPARATE PROSPECTUSES BY CALLING THE DISTRIBUTOR AT
800-998-7633.

The Company does not presently intend to hold annual meetings of
shareholders except as required by the 1940 Act or other applicable law. The
Company will call a meeting of shareholders for the purpose of voting upon the
question of removal of a member of the Board of Directors upon written request
of shareholders owning at least 10% of the outstanding shares of the Company
entitled to vote.

Each Fund share represents an equal, proportionate interest in the assets
belonging to the TempFund portfolio. Fund shares do not have preemptive or
conversion rights. When issued for payment as described in this Prospectus, Fund
shares will be fully paid and non-assessable.

Holders of the Fund's TempFund Shares and Dollar Shares will vote in the
aggregate and not by class or sub-class on all matters, except where otherwise
required by law and except that only Dollar Shares will be entitled to vote on
matters submitted to a vote of shareholders pertaining to the Fund's
arrangements with Service Organizations. Further, shareholders of the Fund and
of the Company's TempCash portfolio will vote in the aggregate and not by
portfolio except as otherwise required by law or when the Board of Directors
determines that the matter to be voted upon affects only the interests of the
shareholders of a particular portfolio. (See the Statement of Additional
Information under "Additional Description Concerning Fund Shares" for examples
where the 1940 Act requires voting by portfolio.) Shareholders of the Company
are entitled to one vote for each full share held (irrespective of class,
sub-class, or portfolio) and fractional votes for fractional shares held. Voting
rights are not cumulative and, accordingly, the holders of more than 50% of the
aggregate shares of Common Stock of the Company may elect all of the directors.

For information concerning the redemption of Fund shares and possible
restrictions on their transferability, see "Purchase and Redemption of Shares."

15
<PAGE> 16

NO PERSON HAS BEEN AUTHORIZED
TO GIVE ANY INFORMATION OR TO
MAKE ANY REPRESENTATIONS NOT
CONTAINED IN THIS PROSPECTUS,
OR IN THE FUND'S STATEMENT OF
ADDITIONAL INFORMATION
INCORPORATED HEREIN BY
REFERENCE, IN CONNECTION WITH
THE OFFERING MADE BY THIS
PROSPECTUS; AND, IF GIVEN OR
MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR
ITS DISTRIBUTOR. THIS
PROSPECTUS DOES NOT
CONSTITUTE AN OFFERING BY THE
COMPANY OR BY THE DISTRIBUTOR
IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT
LAWFULLY BE MADE.

----------------------------------------------------------------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
------
<S> <C>
Background and Expense
Information................... 2
Financial Highlights............ 3
Investment Objective and
Policies...................... 5
Purchase and Redemption of
Shares........................ 7
Management of the Fund.......... 9
Dividends....................... 12
Taxes........................... 13
Yields.......................... 14
Description of Shares and
Miscellaneous................. 14
</TABLE>

PIF-P-001

TEMPFUND
AN INVESTMENT PORTFOLIO
OFFERED BY
TEMPORARY INVESTMENT FUND, INC.

[PROVIDENT INSTITUTIONAL FUND LOGO]

Prospectus
January 26, 1996
<PAGE> 17

TempCash
An Investment Portfolio Offered by
Temporary Investment Fund, Inc.

<TABLE>
<S> <C>
Bellevue Park Corporate Center For purchase and redemption orders only call:
400 Bellevue Parkway, Suite 100 800-441-7450 (in Delaware: 302-791-5350).
Wilmington, DE 19809 For yield information call: 800-821-6006
(TempCash shares code: 21; TempCash Dollar
shares code: 23).
For other information call: 800-821-7432.
</TABLE>

The Fund's investment objective is to seek current income and stability of
principal. The Fund invests in a portfolio consisting of a broad range of money
market instruments, including government, U.S. and foreign bank and commercial
obligations and repurchase agreements relating to such obligations. Under normal
market conditions, at least 25% of the Fund's total assets will be invested in
obligations of issuers in the banking industry and repurchase agreements
relating to such obligations.

Fund shares may not be purchased by individuals directly, but institutional
investors may purchase shares for accounts maintained by individuals. In
addition to TempCash Shares, investors may purchase TempCash "Dollar" Shares
which accrue daily dividends in the same manner as TempCash Shares but bear all
fees payable by the Fund to institutional investors for certain services they
provide to the beneficial owners of such Shares. (See "Management of the
Fund--Service Organizations.")

PNC Institutional Management Corporation ("PIMC") and PNC Bank, National
Association ("PNC Bank") serve as the Fund's adviser, and sub-adviser,
respectively. PFPC Inc. ("PFPC") and Provident Distributors, Inc. ("PDI") serve
as the Fund's administrators. PDI also serves as the Fund's distributor.
------------------------

January 26, 1996
<PAGE> 18

BACKGROUND AND EXPENSE INFORMATION

The Company was incorporated in Maryland on February 8, 1973 and commenced
operations of the Fund in February 1984. The Fund presently offers two separate
classes of shares--TempCash shares and TempCash Dollar shares ("Dollar Shares").
Shares of each class represent equal, pro rata interests in the Fund and accrue
daily dividends in the same manner except that Dollar Shares bear fees payable
by the Fund (at the rate of .25% per annum) to institutional investors for
services they provide to the beneficial owners of such shares. (See "Management
of the Fund--Service Organizations.")

EXPENSE SUMMARY

<TABLE>
<CAPTION>
TEMPCASH
TEMPCASH DOLLAR
SHARES SHARES
----------- -----------
<S> <C> <C> <C> <C>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees (net of waivers)........................... .08% .08%
Other Expenses............................................. .10% .35%
Administration Fees (net of waivers).................. .08% .08%
Shareholder Servicing Fees............................ -- .25%
Miscellaneous......................................... .02% .02%
Total Fund Operating Expenses (net of waivers)............. .18% .43%
--- ---
--- ---
</TABLE>

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

<TABLE>
<CAPTION>
EXAMPLE 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- --------------------------------------------------------------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000 investment,
assuming (1) a 5% annual return; and (2) redemption at the
end of each time period with respect to the following shares:
TempCash Shares: $2 $ 6 $10 $23
TempCash Dollar Shares: $4 $14 $24 $54
</TABLE>

THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR RATE OF RETURN. ACTUAL EXPENSES AND RATE OF RETURN MAY BE GREATER OR
LESS THAN THOSE SHOWN.

The purpose of the foregoing table is to assist an investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. In addition, institutional investors may charge
fees for providing administrative services in connection with their customers'
investment in TempCash Dollar Shares. (For more complete descriptions of the
various costs and expenses, see "Management of the Fund" in this Prospectus and
the Statement of Additional Information and the financial statements and related
notes contained in the Statement of Additional Information.) For the fiscal year
ended September 30, 1995, management and administration fees were each .07% of
the Fund's average net assets. Total Fund operating expenses for TempCash Shares
and Dollar Shares for the fiscal year ended September 30, 1995 absent fee
waivers would have been .30% and .55%, respectively, of the Fund's average net
assets. The investment adviser and administrators may from time to time waive
the advisory and administration fees otherwise payable to them or may reimburse
the Fund for its operating expenses. The foregoing table reflects anticipated
waivers and has not been audited by the Fund's independent accountants.

2
<PAGE> 19

FINANCIAL HIGHLIGHTS

The following financial highlights for TempCash Shares have been derived
from the financial statements of the Fund for the fiscal year ended September
30, 1995, and for each of the eight preceding fiscal years and the fiscal period
ended September 30, 1986 (commencement of operations) and for TempCash Dollar
Shares for the fiscal year ended September 30, 1995 and for each of the nine
preceding fiscal years. The financial highlights for the fiscal years ended
September 30, 1995, 1994, 1993, 1992 and 1991 have been audited by Coopers &
Lybrand L.L.P., independent accountants, whose report on the financial
statements and financial highlights of the Fund is included in the Statement of
Additional Information. The tables should be read in conjunction with the
financial statements and related notes included in the Statement of Additional
Information. Further information about the performance of the Fund is available
in the annual report to shareholders, which may be obtained by calling (800)
821-7432.

TEMPCASH SHARES
The table below sets forth selected financial data for a TempCash Share
outstanding throughout each period presented.
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989
---------- ---------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period........ $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
---------- ---------- ---------- ---------- ---------- ---------- --------
Income From Investment Operations
Net Investment Income...................... .0575 .0370 .0310 .0424 .0676 .0830 .0911
Net Realized Gains on Investments.......... -- -- -- .0008 -- -- --
---------- ---------- ---------- ---------- ---------- ---------- --------
Total From Investment Operations........... .0575 .0370 .0310 .0432 .0676 .0830 .0911
---------- ---------- ---------- ---------- ---------- ---------- --------
Less Distributions
Dividends (From Net Investment Income)..... (.0575) (.0370) (.0310) (.0424) (.0676) (.0830) (.0911)
Distributions (From Capital Gains)......... -- -- -- (.0008) -- -- --
---------- ---------- ---------- ---------- ---------- ---------- --------
Total Distributions........................ (.0575) (.0370) (.0310) (.0432) (.0676) (.0830) (.0911)
---------- ---------- ---------- ---------- ---------- ---------- --------
Net Asset Value, End of Period.............. $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
========== ========== ========== ========== ========== ========== ========
Total Return............................... 5.90% 3.76% 3.14% 4.41% 6.97% 8.62% 9.50%
Ratios/Supplemental Data
Net Assets, End of Period (000)............ $1,316,166 $2,330,456 $1,479,035 $1,492,959 $1,528,637 $1,179,276 $560,740
Ratio of Expenses to Average Daily
Net Assets............................... .16(2) .16%(2) .19%(2) .20%(2) .20%(2) .20%(2) .20%(2)
Ratio of Net Investment Income to Average
Daily Net Assets......................... 5.75% 3.70% 3.10% 4.14% 6.57% 8.17% 9.17%

<CAPTION>
YEAR ENDED
SEPTEMBER 30, OCTOBER 16, 1985(1)
------------------- TO
1988 1987 SEPTEMBER 30, 1986
-------- ------- -------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period........ $1.00 $1.00 $1.00
-------- ------- -------
Income From Investment Operations
Net Investment Income...................... .0723 .0622 .0684
Net Realized Gains on Investments.......... -- -- --
-------- ------- -------
Total From Investment Operations........... .0723 .0622 .0684
-------- ------- -------
Less Distributions
Dividends (From Net Investment Income)..... (.0723) (.0622) (.0684)
Distributions (From Capital Gains)......... -- -- --
-------- ------- -------
Total Distributions........................ (.0723) (.0622) (.0684)
-------- ------- -------
Net Asset Value, End of Period.............. $1.00 $1.00 $1.00
======== ====== ============
Total Return............................... 7.45% 6.40% 7.38%(3)
Ratios/Supplemental Data
Net Assets, End of Period (000)............ $319,267 $48,602 $53,465
Ratio of Expenses to Average Daily
Net Assets............................... .19%(2) .30%(2) .33%(2,3)
Ratio of Net Investment Income to Average
Daily Net Assets......................... 7.33% 6.26% 7.07%(3)
</TABLE>

- ---------------
(1)1 First issuance of Dollar Shares.

(2) Without the waiver of advisory and administration fees, the ratios of
expenses to average daily net assets for TempCash shares would have been
.30%, .33%, .37%, .33%, .34%, .39%, .41%, .43%, and .43% for the years ended
September 30, 1995, 1994, 1993, 1992, 1991, 1990, 1989, 1988, 1987,
respectively, and .41% (annualized) for the period ended September 30, 1986.

(3) Annualized.

3
<PAGE> 20

TEMPCASH DOLLAR SHARES(1)
The table below sets forth selected financial data for a TempCash Dollar Share
outstanding throughout each year presented.
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
--------------------------------------------------------------------
1995 1994 1993 1992 1991 1990
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year................ $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
-------- -------- -------- -------- -------- --------
Income From Investment Operations
Net Investment Income............................ .0550 .0345 .0285 .0399 .0651 .0805
Net Realized Gains on Investments................ -- -- -- .0008 -- --
-------- -------- -------- -------- -------- --------
Total From Investment Operations................. .0550 .0345 .0285 .0407 .0651 .0805
-------- -------- -------- -------- -------- --------
Less Distributions
Dividends (From Net Investment Income)........... (.0550) (.0345) (.0285) (.0399) (.0651) (.0805)
Distributions (From Capital Gains)............... -- -- -- (.0008) -- --
-------- -------- -------- -------- -------- --------
Total Distributions.............................. (.0550) (.0345) (.0285) (.0407) (.0651) (.0805)
-------- -------- -------- -------- -------- --------
Net Asset Value, End of Year...................... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ======== ======== ======== ======== ========
Total Return..................................... 5.65% 3.51% 2.89% 4.16% 6.72% 8.37%
Ratios/Supplemental Data
Net Assets, End of Year (000).................... $454,156 $397,948 $307,239 $408,900 $438,721 $317,267
Ratio of Expenses to Average Daily
Net Assets..................................... .41%(2) .41%(2) .44%(2) .45%(2) .45%(2) .45%(2)
Ratio of Net Investment Income to Average Daily
Net Assets..................................... 5.50% 3.45% 2.85% 3.89% 6.32% 7.92%

<CAPTION>
YEAR ENDED SEPTEMBER 30,
-------------------------------------------
1989 1988 1987 1986
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Year................ $1.00 $1.00 $1.00 $1.00
-------- -------- -------- --------
Income From Investment Operations
Net Investment Income............................ .0886 .0698 .0597 .0691
Net Realized Gains on Investments................ -- -- -- --
-------- -------- -------- --------
Total From Investment Operations................. .0886 .0698 .0597 .0691
-------- -------- -------- --------
Less Distributions
Dividends (From Net Investment Income)........... (.0886) (.0698) (.0597) (.0691)
Distributions (From Capital Gains)............... -- -- -- --
-------- -------- -------- --------
Total Distributions.............................. (.0886) (.0698) (.0597) (.0691)
-------- -------- -------- --------
Net Asset Value, End of Year...................... $1.00 $1.00 $1.00 $1.00
======== ======== ======== ========
Total Return..................................... 9.25% 7.20% 6.15% 7.13%
Ratios/Supplemental Data
Net Assets, End of Year (000).................... $209,507 $125,166 $135,866 $148,807
Ratio of Expenses to Average Daily
Net Assets..................................... .45%(2) .44%(2) .55%(2) .58%(2)
Ratio of Net Investment Income to Average Daily
Net Assets..................................... 8.92% 7.08% 6.01% 6.92%
</TABLE>

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

(1) Prior to October 16, 1985, TempCash Dollar Shares were known as TempCash
Shares.

(2) Without the waiver of advisory and administration fees, the ratios of
expenses to average daily net assets for TempCash Dollar shares would have
been .55%, .58%, .62%, .58%, .59%, .64%, .66%, 68%, .68% and 66% for the
years ended September 30, 1995, 1994, 1993, 1992, 1991, 1990, 1989, 1988,
1987, and 1986, respectively.

4
<PAGE> 21

INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is to seek current income and stability of
principal. Portfolio obligations held by the Fund have remaining maturities of
397 days (thirteen months) or less (with certain exceptions), subject to the
quality, diversification, and other requirements of Rule 2a-7 of the Investment
Company Act of 1940, as amended (the "1940 Act") and other rules of the
Securities and Exchange Commission (the "SEC"). The Fund will limit its
purchases of any one issuer's securities (other than U.S. Government
obligations) to 5% of the Fund's total assets, except that up to 25% of its
total assets may be invested in securities of one issuer for a period of up to
three business days. In pursuing its investment objective, the Fund invests in a
broad range of money market instruments, including government, U.S. and foreign
bank and commercial obligations that may be available in the money markets. The
following descriptions illustrate the types of instruments in which the Fund
invests.

The Fund will purchase only "First Tier Eligible Securities" (as defined by
the SEC) that present minimal credit risks as determined by the investment
adviser pursuant to guidelines approved by the Company's Board of Directors.
First Tier Eligible Securities consist of securities that either (a) have
ratings at the time of purchase in the highest rating category by at least two
unaffiliated nationally recognized statistical rating organizations ("NRSROs")
(or one NRSRO if the security was rated by only one NRSRO), or (b) are issued by
issuers with such ratings. Unrated instruments (including instruments with
long-term but no short-term ratings) purchased by the Fund will be of comparable
quality as determined by the investment adviser pursuant to guidelines approved
by the Board of Directors. A description of applicable NRSRO ratings is in the
Appendix to the Statement of Additional Information.

The Fund may purchase obligations of issuers in the banking industry, such
as bank holding company obligations and certificates of deposit, bankers'
acceptances and time deposits, including U.S. dollar-denominated instruments
issued or supported by the credit of U.S. or foreign banks or savings
institutions having total assets at the time of purchase in excess of $1
billion. The Fund may invest substantially in obligations of foreign banks or
foreign branches of U.S. banks where the

5
<PAGE> 22

investment adviser deems the instrument to present minimal credit risks. Such
investments may nevertheless entail risks that are different from those of
investments in domestic obligations of U.S. banks due to differences in
political, regulatory and economic systems and conditions. The Fund may also
make interest-bearing savings deposits in commercial and savings banks in
amounts not in excess of 5% of its assets.

The Fund may invest in commercial paper and short-term notes and corporate
bonds that meet the Fund's quality and maturity restrictions. Commercial paper
purchased by the Fund may include instruments issued by foreign issuers, such as
Canadian Commercial Paper, which is U.S. dollar-denominated commercial paper
issued by a Canadian corporation or a Canadian counterpart of a U.S.
corporation, and in Europaper, which is U.S. dollar-denominated commercial paper
of a foreign issuer, subject to the criteria stated above for other commercial
paper issuers.

The Fund may purchase variable or floating rate notes, which are unsecured
instruments that provide for adjustments in the interest rate on certain reset
dates or whenever a specified interest rate index changes, respectively. Such
notes may not be actively traded in a secondary market but, in some cases, the
Fund may be entitled to payment of principal on demand and may be able to
re-sell such notes in the dealer market. Variable and floating rate notes are
not typically rated by credit rating agencies, but their issuers must satisfy
the same criteria as set forth above for issuers of commercial paper. If an
issuer of such a note were to default on its payment obligation, the Fund might
be unable to dispose of the note because of the absence of an active secondary
market and might, for this or other reasons, suffer a loss to the extent of the
default. The Fund invests in variable or floating rate notes only when the
investment adviser deems the investment to involve minimal credit risk. Variable
and floating rate notes that do not provide for settlement within seven days may
be deemed illiquid and subject to the 10% limitation on such investments.

6
<PAGE> 23

underlying debt instruments. For this and other reasons, an asset-backed
security's stated maturity may be shortened, and the security's total return may
be difficult to predict precisely. CMOs sometimes demonstrate an additional
level of volatility and may, in certain circumstances, be less liquid than other
money market instruments. The Fund currently intends to hold CMOs only as
collateral for repurchase agreements.

The Fund may make investments in obligations, such as guaranteed investment
contracts and similar funding agreements (collectively "GICs"), issued by highly
rated U.S. insurance companies. A GIC is a general obligation of the issuing
insurance company and not a separate account. The Fund's investments in GIC's
are not expected to exceed 5% of its total assets at the time of purchase absent
unusual market conditions. GIC investments are subject to the Fund's policy
regarding investments in illiquid securities.

INVESTMENT LIMITATIONS

The Fund's investment objective and policies described above are not
fundamental and may be changed by the Company's Board of Directors without a
vote of shareholders. If there is a change in the investment objective,
shareholders should consider whether the Fund remains an appropriate investment
in light of their then current financial position and needs. The Fund's
investment limitations summarized below may not be changed without the
affirmative vote of the holders of a majority of its outstanding shares. (A
complete list of the investment limitations that cannot be changed without a
vote of shareholders is contained in the Statement of Additional Information
under "Investment Objectives and Policies.")

THE FUND MAY NOT:

3. Purchase any securities which would cause, at the time of purchase,
less than 25% of the value of its total assets to be invested in
obligations of issuers in the banking industry or in obligations, such as
repurchase agreements, secured by such obligations (unless the Fund is in a
temporary defensive position) or which would cause, at the time of
purchase, 25% or more of the value of its total assets to be invested in
the obligations of issuers in any other industry.

7
<PAGE> 24

PURCHASE AND REDEMPTION OF SHARES

PURCHASE PROCEDURES

Payment for Fund shares may be made only in federal funds immediately
available to PNC Bank. The minimum initial investment by an institution is $3
million for TempCash Shares and $5,000 for TempCash Dollar Shares; however,
broker-dealers and other institutional investors may set a higher minimum for
their customers. There is no minimum subsequent investment. The Fund, at its
discretion, may reduce the minimum initial investment for TempCash Shares for
specific institutions whose aggregate relationship with the Provident
Institutional Funds is substantially equivalent to this minimum $3 million and
warrants this reduction.

Conflict of interest restrictions may apply to an institution's receipt of
compensation paid by the Fund in connection with the investment of fiduciary
funds in Dollar Shares. (See also "Management of the Fund--Service
Organizations.") Institutions, including banks regulated by the Comptroller of
the Currency and investment advisers and other money managers subject to the
jurisdiction of the SEC, the Department of Labor or state securities
commissions, are urged to consult their legal advisors before investing
fiduciary funds in Dollar Shares. (See also "Management of the Fund--Banking
Laws.")

REDEMPTION PROCEDURES

Payment for redeemed shares for which a redemption order is received by
PFPC by 3:00 P.M., Eastern time, on a Business Day is normally made in federal
funds wired to the redeeming shareholder

8
<PAGE> 25

on the same day. Payment for redemption orders which are received between 3:00
P.M. and 4:00 P.M., Eastern Time or on a day when PNC Bank is closed, is
normally wired in federal funds on the next day following redemption that PNC
Bank is open for business.

The Fund shall have the right to redeem shares in any TempCash Shares
account if the value of the account is less than $100,000, and in any TempCash
Dollar Shares account if the value of the account is less than $1,000, after
sixty-days' prior written notice to the shareholder. Any such redemption shall
be effected at the net asset value next determined after the redemption order is
entered. If during the sixty-day period the shareholder increases the value of
its TempCash Shares account to $100,000 or more or its TempCash Dollar Shares
account to $1,000 or more, no such redemption shall take place. In addition, the
Fund may redeem shares involuntarily under certain special circumstances
described in the Statement of Additional Information under "Additional Purchase
and Redemption Information."

OTHER MATTERS

The Fund's net asset value per share for purposes of pricing purchase and
redemption orders is determined by PIMC as of 12:00 noon and 4:00 P.M., Eastern
time, on each Business Day (excluding holidays on which either the Federal
Reserve Bank of Philadelphia or the New York Stock Exchange are closed).
Currently, one or both of these institutions are closed on the customary
national business holidays of New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day (observed), Independence Day, Labor
Day, Columbus Day (observed), Veterans' Day, Thanksgiving Day, and Christmas
Day. The net asset value per share of Fund shares is calculated by adding the
value of all securities and other assets of the Fund, subtracting liabilities,
and dividing the result by the total number of the Fund's outstanding shares
(irrespective of class or sub-class). In computing net asset value, the Fund
uses the amortized cost method of valuation as described in the Statement of
Additional Information under "Additional Purchase and Redemption Information."
The Fund's net asset value per share for purposes of pricing purchase and
redemption orders is determined independently of the net asset value of the
Company's TempFund portfolio.

Fund shares are sold and redeemed without charge by the Fund. Institutional
investors purchasing or holding Fund shares for their customer accounts may
charge customers fees for cash management and other services provided in
connection with their accounts. A customer should, therefore, consider the terms
of its account with an institution before purchasing Fund shares. An institution
purchasing or redeeming Fund shares on behalf of its customers is responsible
for transmitting orders to the Fund in accordance with its customer agreements.

MANAGEMENT OF THE FUND

BOARD OF DIRECTORS

The business and affairs of the Fund are managed under the direction of the
Company's Board of Directors. The directors of the Company are as follows:

Philip E. Coldwell is an economic consultant and former Member of the
Board of Governors of the Federal Reserve System.

Robert R. Fortune is a financial consultant and former Chairman,
President, and Chief Executive Officer of Associated Electric and Gas
Insurance Services Limited.

9
<PAGE> 26

Rodney D. Johnson is President of Fairmount Capital Advisors, Inc.

G. Willing Pepper, Chairman of the Board and President of the Company,
is a retired President of Scott Paper Company.

Mr. Pepper is considered by the Company to be an "interested person" of the
Company as defined in the 1940 Act.

The other officers of the Company are as follows:

Edward J. Roach is Vice President and Treasurer of the Company.

W. Bruce McConnel, III, Secretary of the Company, is a partner of the
law firm of Drinker Biddle & Reath, Philadelphia, Pennsylvania.

INVESTMENT ADVISER AND SUB-ADVISER

PIMC, a wholly-owned indirect subsidiary of PNC Bank, serves as the Fund's
investment adviser. PIMC was organized in 1977 by PNC Bank to perform advisory
services for investment companies and has its principal offices at Bellevue Park
Corporate Center, 400 Bellevue Parkway, Wilmington, Delaware 19809. PNC Bank
serves as the Fund's sub-adviser. PNC Bank is one of the largest bank managers
of investments for individuals in the United States, and together with its
predecessors has been in the business of managing the investments of fiduciary
and other accounts since 1847. PNC Bank is a wholly-owned, indirect subsidiary
of PNC Bank Corp., and has principal offices at Broad and Chestnut Streets,
Philadelphia, Pennsylvania 19102. PNC Bank Corp. is a multi-bank holding
company. PIMC and PNC Bank also serve as adviser and sub-adviser, respectively,
to the Company's TempCash portfolio.

10
<PAGE> 27

on the Fund's average net assets. PIMC and the administrator may from time to
time reduce the advisory and administration fees otherwise payable to them or
may reimburse the Fund for its operating expenses. Any fees waived and any
expenses reimbursed by PIMC and the administrators with respect to a particular
fiscal year are not recoverable. For the fiscal year ended September 30, 1995,
the Fund paid investment advisory fees aggregating .07% of its average net
assets.

As sub-adviser, PNC Bank provides research, credit analysis and
recommendations with respect to the Fund's investments and supplies PIMC with
certain computer facilities, personnel and other services. For its sub-advisory
services, PNC Bank is entitled to receive from PIMC an amount equal to 75% of
the advisory fees paid by the Fund to PIMC (subject to adjustment in certain
circumstances). The sub-advisory fees paid by PIMC to PNC Bank have no effect on
the advisory fees payable by the Fund to PIMC. PNC Bank also serves as the
Fund's custodian. The services provided by PNC Bank and PIMC and the fees
payable by the Fund for these services are described further in the Statement of
Additional Information under "Management of the Fund."

ADMINISTRATORS

For their administrative services, the administrators are entitled jointly
to receive a fee, computed daily and payable monthly. (For information regarding
the administrators' administrative fee waivers and expense reimbursements, see
"Investment Adviser and Sub-Adviser" above.) The Fund also reimburses each
administrator for its reasonable out-of-pocket expenses incurred in connection
with the Fund's computer access program. For the fiscal year ended September 30,
1995, the Fund paid administrative fees aggregating .07% of its average net
assets.

THE DISTRIBUTOR

11
<PAGE> 28

for the continued registration of the Fund's shares) and of printing and
distributing all sales literature. No compensation is payable by the Fund to the
distributor for its distribution services.

SERVICE ORGANIZATIONS

Institutional investors, such as banks, savings and loan associations and
other financial institutions, including affiliates of PNC Bank Corp. ("Service
Organizations"), may purchase Dollar Shares. TempCash Dollar Shares are
identical in all respects to TempCash Shares except that they bear the service
fees described below and enjoy certain exclusive voting rights on matters
relating to these fees. The Fund will enter into an agreement with each Service
Organization which purchases Dollar Shares requiring it to provide support
services to its customers who are the beneficial owners of such shares in
consideration of the Fund's payment of .25% (on an annualized basis) of the
average daily net asset value of the Dollar Shares held by the Service
Organization for the benefit of customers. Such services, which are described
more fully in the Statement of Additional Information under "Management of the
Fund--Service Organizations," include aggregating and processing purchase and
redemption requests from customers and placing net purchase and redemption
orders with PFPC; processing dividend payments from the Fund on behalf of
customers; providing information periodically to customers showing their
positions in Dollar Shares; and, providing sub-accounting or the information
necessary for sub-accounting with respect to Dollar Shares beneficially owned by
customers. Under the terms of the agreements, Service Organizations are required
to provide to their customers a schedule of any fees that they may charge
customers in connection with their investments in Dollar Shares. TempCash shares
are sold to institutions that have not entered into servicing agreements with
the Fund in connection with their investments.

EXPENSES

Except as noted above and in the Statement of Additional Information, the
Fund's service contractors bear all expenses in connection with the performance
of their services. Similarly, the Fund bears the expenses incurred in its
operations. For the fiscal year ended September 30, 1995, the Fund's total
expenses with respect to TempCash Shares were .16% of the average net assets of
the TempCash Shares and the Fund's total expenses with respect to Dollar Shares
were .41% of the average net assets of the Dollar Shares. With regard to fees
paid exclusively by Dollar Shares, see "Service Organizations" above.

BANKING LAWS

Banking laws and regulations presently prohibit a bank holding company
registered under the Federal Bank Holding Company Act of 1956 or any bank or
non-bank affiliate thereof from sponsoring, organizing, or controlling a
registered, open-end investment company engaged continuously in the issuance of
its shares and prohibit banks generally from issuing, underwriting, selling or
distributing securities such as Fund shares. Such banking laws and regulations
do not prohibit such a holding company or affiliate or banks generally from
acting as investment adviser, transfer agent or custodian to such an investment
company or from purchasing shares of such a company for and upon the order of
customers. PNC Bank, PIMC and PFPC, as well as some Service Organizations, are
subject to such banking laws and regulations, but believe they may perform the
services for the Fund contemplated by their respective agreements, this
Prospectus and the Statement of Additional Information without violating
applicable banking laws or regulations.

12
<PAGE> 29

DIVIDENDS

Institutional shareholders may elect to have their dividends reinvested in
additional full and fractional shares of the same class of shares with respect
to which such dividends are declared at the net asset value of such shares on
the payment date. Reinvested dividends receive the same tax treatment as
dividends paid in cash. Such election, or any revocation thereof, must be made
in writing to PFPC, the Fund's transfer agent, at P.O. Box 8950, Wilmington,
Delaware 19885-9628, and will become effective after its receipt by PFPC with
respect to dividends paid.

TAXES

13
<PAGE> 30

is received in cash or reinvested in additional shares. (Federal income taxes
for distributions to an IRA or a qualified retirement plan are deferred under
the Code.) It is anticipated that none of the Fund's distributions will be
eligible for the dividends received deduction for corporations. The Fund does
not expect to realize long-term capital gains and, therefore, does not
contemplate payment of any "capital gain dividends" as described in the Code.

The foregoing discussion is only a brief summary of some of the important
federal tax considerations generally affecting the Fund and its shareholder. As
noted above, IRAs receive special tax treatment. No attempt is made to present a
detailed explanation of the federal, state, or local income tax treatment of the
Fund or its shareholders, and this discussion is not intended as a substitute
for careful tax planning. Accordingly, potential investors in the Fund should
consult their tax advisers with specific reference to their own tax situation.

YIELDS

From time to time, in advertisements or in reports to shareholders, the
"yields" and "effective yields" for TempCash Shares and TempCash Dollar Shares
may be quoted. Yield quotations are computed separately for TempCash Shares and
Dollar Shares. The "yield" for a particular class or sub-class of Fund shares
refers to the income generated by an investment in such shares over a specified
period (such as a seven-day period). This income is then "annualized;" that is,
the amount of income generated by the investment during that period is assumed
to be generated for each such period over a 52-week or one-year period and is
shown as a percentage of the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an investment in a
particular class or sub-class is assumed to be reinvested. The "effective yield"
will be slightly higher than the "yield" because of the compounding effect of
this assumed reinvestment.

The Fund's yields may be compared to those of other mutual funds with
similar objectives, to stock or other relevant indices, or to rankings prepared
by independent services or other financial or industry publications that monitor
the performance of mutual funds. For example, such data are reported in national
financial publications such as IBC/Donoghue's Money Fund Report(R), The Wall
Street Journal, and The New York Times, reports prepared by Lipper Analytical
Services, Inc., and publications of a local or regional nature.

The Fund's yield figures for TempCash Shares and Dollar Shares represent
the Fund's past performance, will fluctuate, and should not be considered as
representative of future results. The yield of any investment is generally a
function of portfolio quality and maturity, type of investment, and operating
expenses. Any fees charged by Service Organizations or other institutional
investors directly to their customers in connection with investments in Fund
shares are not reflected in the Fund's yields; such fees, if charged, would
reduce the actual return received by customers on their investments. The methods
used to compute the Fund's yields are described in more detail in the Statement
of Additional Information. Investors may call (800) 821-6006 (TempCash Shares
code: 21; TempCash Dollar Shares code: 23) to obtain current yield information.

14
<PAGE> 31

DESCRIPTION OF SHARES AND MISCELLANEOUS

The Company has authorized capital of 60 billion shares of Common Stock,
$.001 par value per share, of which 40 billion shares are classified as Class
B--Common Stock, 5 billion shares are classified as Class B--Special Series 1
Common Stock, 5 billion shares are classified as Class C Common Stock, and 10
billion shares are classified as Class C--Special Series 1 Common Stock. Shares
of Class C Common Stock and Class C--Special Series 1 Common Stock (also known
as "Dollar Shares") represent interests in the Company's TempCash portfolio.
Shares of Class B Common Stock and Class B--Special Series 1 Common Stock
represent interests in the TempFund portfolio. Under the Company's charter, the
Board of Directors has the power to classify or reclassify any unissued shares
of Common Stock into one or more classes or sub-classes.

THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL INFORMATION INCORPORATED
HEREIN RELATE PRIMARILY TO THE FUND AND DESCRIBE ONLY THE INVESTMENT OBJECTIVE
AND POLICIES, OPERATIONS, CONTRACTS, AND OTHER MATTERS RELATING TO THE FUND.
INVESTORS WISHING TO OBTAIN SIMILAR INFORMATION REGARDING THE COMPANY'S TEMPFUND
PORTFOLIO MAY OBTAIN A SEPARATE PROSPECTUS BY CALLING THE DISTRIBUTOR AT
800-998-7633.

Each Fund share represents an equal, proportionate interest in the assets
belonging to the Fund. Fund shares do not have preemptive or conversion rights.
When issued for payment as described in this Prospectus, Fund shares will be
fully paid and non-assessable.

Holders of the Fund's TempCash Shares and Dollar Shares will vote in the
aggregate and not by class or sub-class on all matters, except where otherwise
required by law and except that only Dollar Shares will be entitled to vote on
matters submitted to a vote of shareholders pertaining to the Fund's
arrangements with Service Organizations. Further, shareholders of the Fund and
of the Company's TempFund portfolio will vote in the aggregate and not by
portfolio except as otherwise required by law or when the Board of Directors
determines that the matter to be voted upon affects only the interests of the
shareholders of a particular portfolio. (See the Statement of Additional
Information under "Additional Description Concerning Fund Shares" for examples
where the 1940 Act requires voting by portfolio.) Shareholders of the Company
are entitled to one vote for each full share held (irrespective of class,
sub-class, or portfolio) and fractional votes for fractional shares held. Voting
rights are not cumulative and, accordingly, the holders of more than 50% of the
aggregate shares of Common Stock of the Company may elect all of the directors.

For information concerning the redemption of Fund shares and possible
restrictions on their transferability, see "Purchase and Redemption of Shares."

15
<PAGE> 32

---------------------------------------------------------------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
------
<S> <C>
Background and Expense
Information................... 2
Financial Highlights............ 3
Investment Objective and
Policies...................... 5
Purchase and Redemption of
Shares........................ 8
Management of the Fund.......... 9
Dividends....................... 13
Taxes........................... 13
Yields.......................... 14
Description of Shares and
Miscellaneous................. 15
</TABLE>

PIF-P-002

TEMPCASH
AN INVESTMENT PORTFOLIO
OFFERED BY
TEMPORARY INVESTMENT FUND, INC.

[PROVIDENT INSTITUTIONAL FUNDS LOGO]

Prospectus
January 26, 1996
<PAGE> 33

TempCash
Dollar Shares
An Investment Portfolio Offered by
Temporary Investment Fund, Inc.

<TABLE>
<S> <C>
Bellevue Park Corporate Center For purchase and redemption orders only call:
400 Bellevue Parkway, Suite 100 800-441-7450 (in Delaware: 302-791-5350).
Wilmington, DE 19809 For yield information call: 800-821-6006
(Dollar Shares code: 23).
For other information call: 800-821-7432.
</TABLE>

Temporary Investment Fund, Inc. (the "Company") is a no-load, diversified,
open-end investment company presently offering shares in two separate money
market portfolios. This Prospectus describes one class of shares ("Dollar
Shares") in the TempCash portfolio (the "Fund").

PNC Institutional Management Corporation ("PIMC") and PNC Bank, National
Association ("PNC Bank") serve as the Fund's adviser and sub-adviser. PFPC Inc.
("PFPC") and Provident Distributors, Inc. ("PDI") serve as the Fund's
administrators. PDI also serves as the Fund's distributor. Dollar Shares may not
be purchased by individuals directly, but institutional investors may purchase
shares for accounts maintained by individuals. Service Organizations will
perform shareholder servicing and assistance in connection with the distribution
of Dollar Shares and receive fees from the Fund for their services. (See
"Management of the Fund--Service Organizations.")
------------------------

January 26, 1996
<PAGE> 34

BACKGROUND AND EXPENSE INFORMATION

The Company was incorporated in Maryland on February 8, 1973 and commenced
operations of the Fund in February 1984. The Fund presently offers two separate
classes of shares--TempCash Shares and TempCash Dollar Shares ("Dollar Shares").
Shares of each class represent equal, pro rata interests in the Fund and accrue
daily dividends in the same manner except that Dollar Shares bear fees payable
by the Fund (at the rate of .25% per annum) to institutional investors for
services they provide to the beneficial owners of such shares. (See "Management
of the Fund--Service Organizations.")

EXPENSE SUMMARY--DOLLAR SHARES

<TABLE>
<CAPTION>
DOLLAR
SHARES
-------------
<S> <C> <C>
ESTIMATED ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees (net of waivers)........................................ .08%
Other Expenses.......................................................... .35%
Administration Fees (net of waivers)................................. .08%
Shareholder Servicing Fees........................................... .25%
Miscellaneous........................................................ .02%
Total Fund Operating Expenses (net of waivers).......................... .43%
====
</TABLE>

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

EXAMPLE

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000
investment, assuming (1) a 5% annual return; and (2)
redemption at the end of each time period with respect
to Dollar Shares: $4 $14 $24 $ 54
</TABLE>

THE FOREGOING SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR RATE OF RETURN. ACTUAL EXPENSES AND RATE OF RETURN MAY BE GREATER OR
LESSER THAN THOSE SHOWN.

The purpose of the foregoing table is to assist an investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly or indirectly. In addition, institutional investors may charge
fees for providing administrative services in connection with their customers'
investment in TempCash Dollar Shares. (For more complete descriptions of the
various costs and expenses, see "Management of the Fund" in this Prospectus and
the Statement of Additional Information and the financial statements and related
notes contained in the Statement of Additional Information.) For the fiscal year
ended September 30, 1995, management and administration fees were each .07% of
the Fund's average net assets. Total Fund operating expenses for Dollar Shares
for the fiscal year ended September 30, 1995 absent fee waivers would have been
.55% of the Fund's average net assets. The investment adviser and administrators
may from time to time waive the advisory and administration fees otherwise
payable to them or may reimburse the Fund for its operating expenses. The
foregoing table reflects anticipated waivers and has not been audited by the
Fund's independent accountants.

2
<PAGE> 35

FINANCIAL HIGHLIGHTS

The following financial highlights for TempCash Dollar Shares have been
derived from the financial statements of the Fund for the fiscal year ended
September 30, 1995 and for each of the nine preceding fiscal years and for
TempCash Shares for the fiscal year ended September 30, 1995 and for each of the
eight preceding fiscal years and the fiscal period ended September 30, 1986
(commencement of operations). The financial highlights for the fiscal years
ended September 30, 1995, 1994, 1993, 1992 and 1991 have been audited by Coopers
& Lybrand L.L.P., independent accountants, whose report on the financial
statements and financial highlights of the Fund is included in the Statement of
Additional Information. The tables should be read in conjunction with the
financial statements and related notes included in the Statement of Additional
Information. Further information about the performance of the Fund is available
in the annual report to shareholders, which may be obtained by calling (800)
821-7432.

TEMPCASH DOLLAR SHARES(1)
The table below sets forth selected financial data for a TempCash Dollar Share
outstanding throughout each year presented.
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
--------------------------------------------------------------------
1995 1994 1993 1992 1991 1990
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year................ $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
-------- -------- -------- -------- -------- --------
Income From Investment Operations
Net Investment Income............................ .0550 .0345 .0285 .0399 .0651 .0805
Net Realized Gains on Investments................ - -- -- .0008 -- --
-------- -------- -------- -------- -------- --------
Total From Investment Operations................. .0550 .0345 .0285 .0407 .0651 .0805
-------- -------- -------- -------- -------- --------
Less Distributions
Dividends (From Net Investment Income)........... (.0550) (.0345) (.0285) (.0399) (.0651) (.0805)
Distributions (From Capital Gains)............... -- -- -- (.0008) -- --
-------- -------- -------- -------- -------- --------
Total Distributions.............................. (.0550) (.0345) (.0285) (.0407) (.0651) (.0805)
-------- -------- -------- -------- -------- --------
Net Asset Value, End of Year...................... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ======== ======== ======== ======== ========
Total Return..................................... 5.65% 3.51% 2.89% 4.16% 6.72% 8.37%
Ratios/Supplemental Data
Net Assets, End of Year (000).................... $454,156 $397,948 $307,239 $408,900 $438,721 $317,267
Ratio of Expenses to Average Daily
Net Assets..................................... .41%(2) .41%(2) .44%(2) .45%(2) .45%(2) .45%(2)
Ratio of Net Investment Income to Average Daily
Net Assets..................................... 5.50% 3.45% 2.85% 3.89% 6.32% 7.92%

<CAPTION>
YEAR ENDED SEPTEMBER 30,
--------------------------------------------
1989 1988 1987 1986
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Year................ $1.00 $1.00 $1.00 $1.00
-------- -------- -------- --------
Income From Investment Operations
Net Investment Income............................ .0886 .0698 .0597 .0691
Net Realized Gains on Investments................ -- -- -- --
-------- -------- -------- --------
Total From Investment Operations................. .0886 .0698 .0597 .0691
-------- -------- -------- --------
Less Distributions
Dividends (From Net Investment Income)........... (.0886) (.0698) (.0597) (.0691)
Distributions (From Capital Gains)............... -- -- -- --
-------- -------- -------- --------
Total Distributions.............................. (.0886) (.0698) (.0597) (.0691)
-------- -------- -------- --------
Net Asset Value, End of Year...................... $1.00 $1.00 $1.00 $1.00
======== ======== ======== ========
Total Return..................................... 9.25% 7.20% 6.15% 7.13%
Ratios/Supplemental Data
Net Assets, End of Year (000).................... $209,507 $125,166 $135,866 $148,807
Ratio of Expenses to Average Daily
Net Assets..................................... .45%(2) .44%(2) .55%(2) .58%(2)
Ratio of Net Investment Income to Average Daily
Net Assets..................................... 8.92% 7.08% 6.01% 6.92%
</TABLE>

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

(1) Prior to October 16, 1985, TempCash Dollar Shares were known as TempCash
Shares.

(2) Without the waiver of advisory and administration fees, the ratios of
expenses to average daily net assets for TempCash Dollar Shares would have
been .55%, .58%, .62%, .58%, .59%, .64%, .66%, .68%, .68% and .66% for the
years ended September 30, 1995, 1994, 1993, 1992, 1991, 1990, 1989, 1988,
1987 and 1986, respectively.

3
<PAGE> 36

TEMPCASH SHARES

The table below sets forth selected financial data for a TempCash Share
outstanding throughout each period presented.
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
------------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989
-------- ---------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period............................... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
-------- ---------- ---------- ---------- ---------- ---------- --------
Income From Investment Operations
Net Investment Income................ .0575 .0370 .0310 .0424 .0676 .0830 .0911
Net Realized Gains on Investments.... -- -- -- .0008 -- -- --
-------- ---------- ---------- ---------- ---------- ---------- --------
Total From Investment Operations..... .0575 .0370 .0310 .0432 .0676 .0830 .0911
-------- ---------- ---------- ---------- ---------- ---------- --------
Less Distributions
Dividends (From Net Investment
Income)............................ (.0575) (.0370) (.0310) (.0424) (.0676) (.0830) (.0911)
Distributions (From Capital Gains)... -- -- -- (.0008) -- -- --
-------- ---------- ---------- ---------- ---------- ---------- --------
Total Distributions.................. (.0575) (.0370) (.0310) (.0432) (.0676) (.0830) (.0911)
-------- ---------- ---------- ---------- ---------- ---------- --------
Net Asset Value, End of Period........ $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
======== ========== ========== ========== ========== ========== ========
Total Return......................... 5.90% 3.76% 3.14% 4.41% 6.97% 8.62% 9.50%
Ratios/Supplemental Data
Net Assets, End of Period (000)...... $316,166 $2,330,456 $1,479,035 $1,492,959 $1,528,637 $1,179,276 $560,740
Ratio of Expenses to Average Daily
Net Assets......................... .16%(2) .16%(2) .19%(2) .20%(2) .20%(2) .20%(2) .20%(2)
Ratio of Net Investment Income
to Average Daily Net Assets........ 5.75% 3.70% 3.10% 4.14% 6.57% 8.17% 9.17%

<CAPTION>
YEAR ENDED
SEPTEMBER 30, OCTOBER 16, 19851
------------------ TO
1988 1987 SEPTEMBER 30, 1986
-------- ------- ------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of
Period............................... $1.00 $1.00 $1.00
-------- ------- -------
Income From Investment Operations
Net Investment Income................ .0723 .0622 .0684
Net Realized Gains on Investments.... -- -- --
-------- ------- -------
Total From Investment Operations..... .0723 .0622 .0684
-------- ------- -------
Less Distributions
Dividends (From Net Investment
Income)............................ (.0723) (.0622) (.0684)
Distributions (From Capital Gains)... -- -- --
-------- ------- -------
Total Distributions.................. (.0723) (.0622) (.0684)
-------- ------- -------
Net Asset Value, End of Period........ $1.00 $1.00 $1.00
======== ======= =============
Total Return......................... 7.45% 6.40% 7.38%(3)
Ratios/Supplemental Data
Net Assets, End of Period (000)...... $319,267 $48,602 $ 53,465
Ratio of Expenses to Average Daily
Net Assets......................... .19%(2) .30%(2) .33%(2,3)
Ratio of Net Investment Income
to Average Daily Net Assets........ 7.33% 6.26% 7.07%(3)
</TABLE>

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

(1) First issuance of Dollar Shares.

(2) Without the waiver of advisory and administration fees, the ratios of
expenses to average daily net assets for TempCash shares would have been
.30%, .33%, .37%, .33%, .34%, .39%, .41%, .43% and .43% for the years ended
September 30, 1995, 1994, 1993, 1992, 1991, 1990, 1989, 1988, and 1987,
respectively, and .41% (annualized) for the period ended September 30, 1986.

(3) Annualized.

4
<PAGE> 37

INVESTMENT OBJECTIVE AND POLICIES

The Fund's investment objective is to seek current income and stability of
principal. Portfolio obligations held by the Fund have remaining maturities of
397 days (thirteen months) or less (with certain exceptions), subject to the
quality, diversification, and other requirements of Rule 2a-7 of the Investment
Company Act of 1940, as amended (the "1940 Act") and other rules of the
Securities and Exchange Commission (the "SEC"). The Fund will limit its
purchases of any one issuer's securities (other than U.S. Government
obligations) to 5% of the Fund's total assets, except that up to 25% of its
total assets may be invested in securities of one issuer for a period of up to
three business days. In pursuing its investment objective, the Fund invests in a
broad range of money market instruments, including government, U.S. and foreign
bank and commercial obligations that may be available in the money markets. The
following descriptions illustrate the types of instruments in which the Fund
invests.

5
<PAGE> 38

different from those of investments in domestic obligations of U.S. banks due to
differences in political, regulatory and economic systems and conditions. The
Fund may also make interest-bearing savings deposits in commercial and savings
banks in amounts not in excess of 5% of its assets.

The Fund may purchase variable or floating rate notes, which are unsecured
instruments that provide for adjustments in the interest rate on certain reset
dates or whenever a specified interest rate index changes, respectively. Such
notes may not be actively traded in a secondary market, but in some cases, the
Fund may be entitled to payment of principal on demand and may be able to
re-sell such notes in the dealer market. Variable and floating rate notes are
not typically rated by credit rating agencies, but their issuers must satisfy
the same criteria as set forth above for issuers of commercial paper. If an
issuer of such a note were to default on its payment obligation, the Fund might
be unable to dispose of the note because of the absence of an active secondary
market and might, for this or other reasons, suffer a loss to the extent of the
default. The Fund invests in variable or floating rate notes only when the
investment adviser deems the investment to involve minimal credit risk. Variable
and floating rate notes that do not provide for settlement within seven days may
be deemed illiquid and subject to the 10% limitation on such investments.

The Fund may invest in asset-backed securities which are backed by
mortgages, installment sales contracts, credit card receivables or other assets
and collateralized mortgage obligations ("CMOs") issued or guaranteed by U.S.
Government agencies and instrumentalities or issued by private companies.
Purchasable mortgage-related securities also include adjustable rate securities.
The estimated life of an asset-backed security varies with the prepayment
experience with respect to the underlying debt instruments. For this and other
reasons, an asset-backed security's stated maturity may be shortened, and the
security's total return may be difficult to predict precisely. CMOs sometimes
demonstrate an additional level of volatility and may, in certain circumstances,
be less liquid than

6
<PAGE> 39

other money market instruments. The Fund currently intends to hold CMOs only as
collateral for repurchase agreements.

INVESTMENT LIMITATIONS

The Fund's investment objectives and policies described above are not
fundamental and may be changed by the Company's Board of Directors without a
vote of shareholders. If there is a change in the investment objective,
shareholders should consider whether the Fund remains an appropriate investment
in light of their then current financial position and needs. The Fund's
investment limitations summarized below may not be changed without the
affirmative vote of the holders of a majority of its outstanding shares. (A
complete list of the investment limitations that cannot be changed without a
vote of shareholders is contained in the Statement of Additional Information
under "Investment Objectives and Policies.")

THE FUND MAY NOT:

7
<PAGE> 40

PURCHASE AND REDEMPTION OF SHARES

PURCHASE PROCEDURES

Dollar Shares are sold exclusively to institutional investors, such as
banks and savings and loan associations ("Service Organizations"), acting on
behalf of themselves or their customers and customers of their affiliates
("customers"). The customers, which may include individuals, trusts,
partnerships and corporations, must maintain accounts (such as demand deposit,
custody, trust or escrow accounts) with the Service Organization. Service
Organizations (or their nominees) will normally be the holders of record of
Dollar Shares, and will reflect their customers' beneficial ownership of shares
in the account statements provided by them to their customers. The exercise of
voting rights and the delivery to customers of shareholder communications from
the Fund will be governed by the customers' account agreements with the Service
Organizations. Investors wishing to purchase Dollar Shares should contact their
account representatives.

Purchase orders must be transmitted by a Service Organization directly to
PFPC, the Fund's transfer agent. All such transactions are effected pursuant to
procedures established by the Service Organization in connection with a
customer's account. Dollar Shares are sold at the net asset value per share next
determined after receipt of a purchase order by PFPC.

Purchase orders for shares are accepted by the Fund only on days on which
both the New York Stock Exchange and the Federal Reserve Bank of Philadelphia
are open for business (a "Business Day") and must be transmitted to PFPC in
Wilmington, Delaware, by telephone (800-441-7450; in Delaware: 302-791-5350) or
through the Fund's computer access program. Orders received before 12:00 noon,
Eastern time, for which payment has been received by PNC Bank, the Fund's
custodian, will be executed at 12:00 noon. Orders received after 12:00 noon and
before 3:00 P.M., Eastern time (or orders received earlier in the same day for
which payment has not been received by 12:00 noon), will be executed at 4:00
P.M., Eastern time, if payment has been received by PNC Bank by that time.
Orders received at other times, and orders for which payment has not been
received by 4:00 P.M., Eastern time, will not be accepted, and notice thereof
will be given to the Service Organization placing the order. (Payment for orders
which are not received or accepted will be returned after prompt inquiry to the
sending institution.) The Fund may in its discretion reject any order for
shares.

Payment for Dollar Shares may be made only in federal funds immediately
available to PNC Bank. The minimum initial investment by a Service Organization
is $5,000 and there is no minimum subsequent investment; however, Service
Organizations may set a higher minimum initial investment and minimum subsequent
investments for their customers.

Conflict of interest restrictions may apply to a Service Organization's
receipt of compensation paid by the Fund in connection with the investment of
fiduciary funds in Dollar Shares. (See also "Management of the Fund--Service
Organizations.") Institutions, including banks regulated by the Comptroller of
the Currency and investment advisers and other money managers subject to the
jurisdiction of the SEC, the Department of Labor or state securities
commissions, should consult their legal advisors before investing fiduciary
funds in Dollar Shares. (See also "Management of the Fund--Banking Laws.")

REDEMPTION PROCEDURES

Redemption orders must be transmitted by the Service Organization to PFPC
in Wilmington, Delaware in the manner described under "Purchase Procedures."
Shares are redeemed at the net asset value per share next determined after
PFPC's receipt of the redemption order. While the Fund intends to use its best
efforts to maintain its net asset value per share at $1.00, the proceeds paid to
a

8
<PAGE> 41

shareholder upon redemption may be more or less than the amount invested
depending upon a share's net asset value at the time of redemption.

The Fund shall have the right to redeem shares in any Dollar Shares account
if the value of the account is less than $1,000 after sixty-days' prior written
notice to the shareholder. Any such redemption shall be effected at the net
asset value next determined after the redemption order is entered. If during the
sixty-day period the shareholder increases the value of its account to $1,000 or
more, no such redemption shall take place. In addition, the Fund may redeem
shares involuntarily under certain special circumstances described in the
Statement of Additional Information under "Additional Purchase and Redemption
Information."

OTHER MATTERS

The Fund's net asset value per share for purposes of pricing purchase and
redemption orders is determined by PIMC as of 12:00 noon and 4:00 P.M., Eastern
time, on each Business Day (excluding those holidays on which either the Federal
Reserve Bank of Philadelphia or the New York Stock Exchange are closed).
Currently, one or both of these institutions are closed on the customary
national business holidays of New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day (observed), Independence Day, Labor
Day, Columbus Day (observed), Veterans' Day, Thanksgiving Day, and Christmas
Day. The net asset value per share of Fund shares is calculated by adding the
value of all securities and other assets of the Fund, subtracting liabilities,
and dividing the result by the total number of the Fund's outstanding shares
(irrespective of class or sub-class). In computing net asset value, the Fund
uses the amortized cost method of valuation as described in the Statement of
Additional Information under "Additional Purchase and Redemption Information."
The Fund's net asset value per share for purposes of pricing purchase and
redemption orders is determined independently of the net asset value of the
Company's TempFund portfolio.

Fund shares are sold and redeemed without charge by the Fund. Service
Organizations purchasing or holding Dollar Shares for their customer accounts
may charge customers a fee for cash management and other services provided in
connection with their accounts. In addition, if a customer has agreed with a
particular Service Organization to maintain a minimum balance in its account
with the Service Organization and the balance in such account falls below that
minimum, the customer may be obliged by the Service Organization to redeem all
or part of its shares in the Fund to the extent necessary to maintain the
required minimum balance in such account. A customer should, therefore, consider
the terms of its account with a Service Organization before purchasing Dollar
Shares. A Service Organization purchasing or redeeming shares on behalf of its
customers is responsible for transmitting orders to the Fund in accordance with
its customer agreements, and to provide customers with account statements with
respect to share transactions for their accounts.

9
<PAGE> 42

MANAGEMENT OF THE FUND

BOARD OF DIRECTORS

The business and affairs of the Fund are managed under the direction of the
Company's Board of Directors. The directors of the Company are as follows:

Philip E. Coldwell is an economic consultant and former Member of the
Board of Governors of the Federal Reserve System.

Robert R. Fortune is a financial consultant and former Chairman,
President, and Chief Executive Officer of Associated Electric and Gas
Insurance Services Limited.

Rodney D. Johnson is President of Fairmount Capital Advisors, Inc.

G. Willing Pepper, Chairman of the Board and President of the Company,
is a retired President of Scott Paper Company.

Mr. Pepper is considered by the Company to be an "interested person" of the
Company as defined in the 1940 Act.

The other officers of the Company are as follows:

Edward J. Roach is Vice President and Treasurer of the Company.

W. Bruce McConnel, III, Secretary of the Company, is a partner of the
law firm of Drinker Biddle & Reath, Philadelphia, Pennsylvania.

INVESTMENT ADVISER AND SUB-ADVISER

10
<PAGE> 43

approximately 370 mutual funds with 3.5 million shareholders and in excess of
$101 billion in assets, including some $2 billion in non-U.S. assets.
Additionally, this group, through its PNC Institutional Investment Service,
provides investment research to some 250 financial institutions located in the
United States and abroad. PNC Bank provides custodial services for approximately
$210 billion in assets, including approximately $160 billion in mutual fund
assets.

As sub-adviser, PNC Bank provides research, credit analysis and
recommendations with respect to the Fund's investments and supplies PIMC with
certain computer facilities, personnel and other services. For its sub-advisory
services, PNC Bank is entitled to receive from PIMC an amount equal to 75% of
the advisory fees paid by the Fund to PIMC (subject to adjustment in certain
circumstances). The sub-advisory fees paid by PIMC to PNC Bank have no effect on
the advisory fees payable by the Fund to PIMC. PNC Bank also serves as the
Fund's custodian. The services provided by PNC Bank and PIMC and the fees
payable by the Fund for these services are described further in the Statement of
Additional Information under "Management of the Fund."

ADMINISTRATORS

For their administrative services, the administrators are entitled jointly
to receive a fee, computed daily and payable monthly. (For information regarding
the administrators' administrative fee waivers and expense reimbursements, see
"Investment Adviser and Sub-Adviser" above.) The Fund also reimburses each
administrator for its reasonable out-of-pocket expenses incurred in connection
with the Fund's computer access program. For the fiscal year ended September 30,
1995, the Fund paid administrative fees aggregating .07% of its average net
assets.

11
<PAGE> 44

THE DISTRIBUTOR

SERVICE ORGANIZATIONS

As stated above, Service Organizations (which may include affiliates of PNC
Bank Corp.) may purchase Dollar Shares offered by the Fund. Dollar Shares are
identical in all respects to TempCash Shares except that they bear the service
fees described below and enjoy certain exclusive voting rights on matters
relating to these fees. The Fund will enter into an agreement with each Service
Organization which purchases Dollar Shares requiring it to provide support
services to its customers who are the beneficial owners of such shares in
consideration of the Fund's payment of .25% (on an annualized basis) of the
average daily net asset value of the Dollar Shares held by the Service
Organization for the benefit of customers. Such services, which are described
more fully in the Statement of Additional Information under "Management of the
Fund--Service Organizations," include aggregating and processing purchase and
redemption requests from customers and placing net purchase and redemption
orders with PFPC; processing dividend payments from the Fund on behalf of
customers; providing information periodically to customers showing their
positions in Dollar Shares; and, providing sub-accounting or the information
necessary for sub-accounting with respect to Dollar Shares beneficially owned by
customers. Under the terms of the agreements, Service Organizations are required
to provide to their customers a schedule of any fees that they may charge
customers in connection with their investments in Dollar Shares.

EXPENSES

BANKING LAWS

Banking laws and regulations presently prohibit a bank holding company
registered under the Federal Bank Holding Company Act of 1956 or any bank or
non-bank affiliate thereof from sponsoring, organizing or controlling a
registered, open-end investment company engaged continuously in the issuance of
its shares and prohibit banks generally from issuing, underwriting, selling or
distributing securities such as Fund shares. Such banking laws and regulations
do not prohibit such a holding company or affiliate or banks generally from
acting as investment adviser, transfer agent or custodian to such an investment
company or from purchasing shares of such a company for and upon the order of
customers. PNC Bank, PIMC and PFPC, as well as some Service Organizations, are
subject to such

12
<PAGE> 45

banking laws and regulations, but believe they may perform the services for the
Fund contemplated by their respective agreements, this Prospectus and the
Statement of Additional Information without violating applicable banking laws or
regulations.

DIVIDENDS

Institutional shareholders may elect to have their dividends reinvested in
additional full and fractional shares of the same class of shares with respect
to which such dividends are declared at the net asset value of such shares on
the payment date. Reinvested dividends receive the same tax treatment as
dividends paid in cash. Such election or any revocation thereof, must be made in
writing to PFPC, the Fund's transfer agent, at P.O. Box 8950, Wilmington,
Delaware 19885-9628 and will become effective after its receipt by PFPC with
respect to dividends paid.

TAXES

13
<PAGE> 46

year. The Fund intends to distribute substantially all of its investment company
taxable income each year. Such distributions will be taxable as ordinary income
to Fund shareholders which are not currently exempt from federal income taxes,
whether such income is received in cash or reinvested in additional shares.
(Federal income taxes for distributions to an IRA or a qualified retirement plan
are deferred under the Code.) It is anticipated that none of the Fund's
distributions will be eligible for the dividends received deduction for
corporations. The Fund does not expect to realize long-term capital gains and,
therefore, does not contemplate payment of any "capital gain dividends" as
described in the Code.

The foregoing discussion is only a brief summary of some of the important
federal tax considerations generally affecting the Fund and its shareholders. As
noted above, IRAs receive special tax treatment. No attempt is made to present a
detailed explanation of the federal, state, or local income tax treatment of the
Fund or its shareholders, and this discussion is not intended as a substitute
for careful tax planning. Accordingly, potential investors in the Fund should
consult their tax advisors with specific reference to their own tax situation.

YIELDS

From time to time in advertisements, or in reports to shareholders, the
"yields" and "effective yields" for TempCash Shares and Dollar Shares may be
quoted. Yield quotations are computed separately for TempCash Shares and Dollar
Shares. The "yield" for a particular class or sub-class of Fund shares refers to
the income generated by an investment in such shares over a specified period
(such as a seven-day period). This income is then "annualized;" that is, the
amount of income generated by the investment during that period is assumed to be
generated for each such period over a 52-week or one-year period and is shown as
a percentage of the investment. The "effective yield" is calculated similarly
but, when annualized, the income earned by an investment in a particular class
or sub-class is assumed to be reinvested. The "effective yield" will be slightly
higher than the "yield" because of the compounding effect of this assumed
reinvestment.

The Fund's yields may be compared to those of other mutual funds with
similar objectives, to stock or other relevant indices, or to rankings prepared
by independent services or other financial or industry publications that monitor
the performance of mutual funds. For example, such data are reported in national
financial publications such as IBC/Donoghue's Money Fund Report(R), The Wall
Street Journal, and The New York Times, reports prepared by Lipper Analytical
Services, Inc., and publications of a local or regional nature.

The Fund's yield figures for TempCash Shares and Dollar Shares represent
the Fund's past performance, will fluctuate, and should not be considered as
representative of future results. The yield of any investment is generally a
function of portfolio quality and maturity, type of investment, and operating
expenses. Any fees charged by Service Organizations directly to their customers
in connection with investments in Fund shares are not reflected in the Fund's
yields; such fees, if charged, would reduce the actual return received by
customers on their investments. The methods used to compute the Fund's yields
are described in more detail in the Statement of Additional Information.
Investors may call (800) 821-6006 (Dollar Shares code: 23) to obtain current
yield information.

14
<PAGE> 47

DESCRIPTION OF SHARES AND MISCELLANEOUS

The Company has authorized capital of 60 billion shares of Common Stock,
$.001 par value per share, of which 40 billion shares are classified as Class B
Common Stock, 5 billion shares are classified as Class B--Special Series 1
Common Stock, 5 billion shares are classified as Class C Common Stock, and 10
billion shares are classified as Class C--Special Series 1 Common Stock. Shares
of Class C Common Stock and Class C--Special Series 1 Common Stock (also known
as "Dollar Shares") represent interests in the Company's TempCash portfolio.
Shares of Class B Common Stock and Class B--Special Series 1 Common Stock
represent interests in the TempFund portfolio. Under the Company's charter, the
Board of Directors has the power to classify or reclassify any unissued shares
of Common stock into one or more classes or sub-classes.

THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL INFORMATION INCORPORATED
HEREIN RELATE PRIMARILY TO THE DOLLAR SHARES OF THE FUND AND DESCRIBE ONLY THE
INVESTMENT OBJECTIVE AND POLICIES, OPERATIONS, CONTRACTS, AND OTHER MATTERS
RELATING TO THE FUND. INVESTORS WISHING TO OBTAIN SIMILAR INFORMATION REGARDING
THE FUND'S OTHER CLASS OF SHARES OR THE COMPANY'S TEMPFUND PORTFOLIO MAY OBTAIN
SEPARATE PROSPECTUSES BY CALLING THE DISTRIBUTOR AT 800-998-7633.

For information concerning the redemption of Fund shares and possible
restrictions on their transferability, see "Purchase and Redemption of Shares."

15
<PAGE> 48

---------------------------------------------------------------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
------
<S> <C>
Background and Expense
Information................... 2
Financial Highlights............ 3
Investment Objective and
Policies...................... 5
Purchase and Redemption of
Shares........................ 8
Management of the Fund.......... 10
Dividends....................... 13
Taxes........................... 13
Yields.......................... 14
Description of Shares and
Miscellaneous................. 15
</TABLE>

PIF-P-021

TEMPCASH
DOLLAR SHARES
AN INVESTMENT PORTFOLIO
OFFERED BY
TEMPORARY INVESTMENT FUND, INC.

[PROVIDENT INSTITUTIONAL FUNDS LOGO]

Prospectus
January 26, 1996
<PAGE> 49

TEMPFUND AND TEMPCASH
Investment Portfolios Offered By
Temporary Investment Fund, Inc.

Statement of Additional Information
January 26, 1996

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
The Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Investment Objectives and Policies . . . . . . . . . . . . . . . . . . . 2

Additional Purchase and Redemption Information . . . . . . . . . . . . . 12

Management of the Funds . . . . . . . . . . . . . . . . . . . . . . . . . 15

Additional Information Concerning Taxes . . . . . . . . . . . . . . . . . 26

Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Additional Yield Information . . . . . . . . . . . . . . . . . . . . . . 28

Additional Description Concerning Shares . . . . . . . . . . . . . . . . 30

Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . FS-1

Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
</TABLE>

This Statement of Additional Information is meant to
be read in conjunction with the Prospectuses for the TempFund and TempCash
portfolios, each dated January 26, 1996, and is incorporated by reference in
its entirety into each Prospectus. Because this Statement of Additional
Information is not itself a prospectus, no investment in shares of the TempFund
or TempCash portfolios should be made solely upon the information contained
herein. Copies of a Prospectus for TempFund, TempCash or TempCash Dollar
Shares may be obtained by calling 800-821-7432. Capitalized terms used but not
defined herein have the same meanings as in the Prospectuses.
<PAGE> 50
THE COMPANY

Temporary Investment Fund, Inc. (the "Company") is a no-load,
diversified, open-end investment company presently offering shares in two
separate money market portfolios - TempFund and TempCash (individually, a
"Fund;" collectively, the "Funds").

Although TempFund and TempCash have the same investment
adviser and have comparable investment objectives, their yields will normally
vary due to their differing cash flows and their differing types of portfolio
securities (for example, TempCash invests in obligations of foreign
governments, foreign banks and foreign branches of U.S. banks and TempFund does
not).

INVESTMENT OBJECTIVES AND POLICIES

As stated in the Funds' Prospectuses, the investment objective
of each Fund is to seek current income and stability of principal, and the
Funds do so by investing in a portfolio of money market instruments. The
following policies supplement the description of each Fund's investment
objective and policies as contained in the applicable Prospectuses.

PORTFOLIO TRANSACTIONS

Subject to the general control of the Company's Board of
Directors, PIMC, each Fund's investment adviser, is responsible for, makes
decisions with respect to, and places orders for all purchases and sales of
portfolio securities for a Fund. PIMC purchases portfolio securities for the
Funds either directly from the issuer or from dealers who specialize in money
market instruments. Such purchases are usually without brokerage commissions.
In making portfolio investments, PIMC seeks to obtain the best net price and
the most favorable execution of orders. To the extent that the execution and
price offered by more than one dealer are comparable, PIMC may, in its
discretion, effect transactions in portfolio securities with dealers who
provide the Company with research advice or other services. For the fiscal
years ended September 30, 1993, 1994 and 1995, TempFund and TempCash paid no
brokerage commissions.

PIMC may seek to obtain an undertaking from issuers of
commercial paper or dealers selling commercial paper to consider the repurchase
of such securities from a Fund prior to their maturity at their original cost
plus interest (interest may sometimes be adjusted to reflect the actual
maturity of the securities) if PIMC believes that a Fund's anticipated need for
liquidity makes such action desirable. Certain dealers (but not

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issuers) have charged and may in the future charge a higher price for
commercial paper where they undertake to repurchase prior to maturity. The
payment of a higher price in order to obtain such an undertaking reduces the
yield which might otherwise be received by a Fund on the commercial paper. The
Company's Board of Directors has authorized PIMC to pay a higher price for
commercial paper where it secures such an undertaking if PIMC believes that the
prepayment privilege is desirable to assure a Fund's liquidity and such an
undertaking cannot otherwise be obtained.

Investment decisions for each Fund are made independently from
those for another of the Company's portfolios or other investment company
portfolios or accounts advised or managed by PIMC. Such other portfolios may
also invest in the same securities as the Funds. When purchases or sales of
the same security are made at substantially the same time on behalf of such
other portfolios, transactions are averaged as to price, and available
investments allocated as to amount, in a manner which PIMC believes to be
equitable to each portfolio, including either Fund. In some instances, this
investment procedure may adversely affect the price paid or received by a Fund
or the size of the position obtained for a Fund. To the extent permitted by
law, PIMC may aggregate the securities to be sold or purchased for a Fund with
those to be sold or purchased for such other portfolios in order to obtain best
execution.

The Funds will not execute portfolio transactions through or
acquire portfolio securities issued by PIMC, PNC Bank, National Association
("PNC Bank"), PFPC Inc. ("PFPC"), and Provident Distributors, Inc. ("PDI"), or
any affiliated person (as such term is defined in the Investment Company Act of
1940 (the "1940 Act")) of any of them, except to the extent permitted by the
Securities and Exchange Commission (the "SEC"). In addition, with respect to
such transactions, securities, deposits and agreements, the Funds will not give
preference to Service Organizations with whom a Fund enters into agreements
concerning the provision of support services to customers who beneficially own
TempFund Dollar Shares or TempCash Dollar Shares (collectively, "Dollar
Shares"). (See the applicable Prospectus, "Management of the Fund -- Service
Organizations.")

The TempFund Portfolio does not intend to seek profits through
short-term trading. Each Fund's annual portfolio turnover will be relatively
high, but is not expected to have a material effect on its net income. Each
Fund's portfolio turnover rate is expected to be zero for regulatory reporting
purposes.

ADDITIONAL INFORMATION ON PORTFOLIO INSTRUMENTS

VARIABLE AND FLOATING RATE INSTRUMENTS. With respect to the
variable and floating rate instruments described in the applicable
Prospectuses, the investment adviser will consider the

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earning power, cash flows, and other liquidity ratios of the issuers and
guarantors of such instruments and will continuously monitor their financial
ability to meet payment.

REPURCHASE AGREEMENTS. Collateral for a repurchase agreement
may include obligations issued by the U.S. Government or its agencies or
instrumentalities or obligations rated in the highest category by an NRSRO.
The repurchase price under the repurchase agreements described in the Funds'
Prospectuses generally equals the price paid by that Fund plus interest
negotiated on the basis of current short-term rates (which may be more or less
than the rate on the securities underlying the repurchase agreement).
Securities subject to repurchase agreements will be held by the Company's
custodian or sub-custodian, or in the Federal Reserve/ Treasury book-entry
system. Repurchase agreements are considered to be loans by the Funds under
the 1940 Act.

WHEN-ISSUED PURCHASES. As stated in the Funds' Prospectuses,
each Fund may purchase securities on a when-issued basis. When a Fund agrees
to purchase when-issued securities, the custodian will set aside cash or liquid
portfolio securities equal to the amount of the commitment in a separate
account. Normally, the custodian will set aside portfolio securities to
satisfy a purchase commitment, and in such a case that Fund may be required
subsequently to place additional assets in the separate account in order to
ensure that the value of the account remains equal to the amount of such Fund's
commitment. It may be expected that the market value of the Fund's net assets
will fluctuate to a greater degree when it sets aside portfolio securities to
cover such purchase commitments than when it sets aside cash. A Fund's
liquidity and ability to manage its portfolio might be affected when it sets
aside cash or portfolio securities to cover such purchase commitments. When a
Fund engages in when-issued transactions, it relies on the seller to consummate
the trade. Failure of the seller to do so may result in a Fund's incurring a
loss or missing an opportunity to obtain a price considered to be advantageous.
Neither Fund intends to purchase when-issued securities for speculative
purposes but only in furtherance of its investment objective. Each Fund
reserves the right to sell these securities before the settlement date if it is
deemed advisable.

U.S. GOVERNMENT OBLIGATIONS. Examples of the types of U.S.
Government obligations that may be held by a Fund include U.S. Treasury Bills,
Treasury Notes, and Treasury Bonds and the obligations of the Federal Housing
Administration, Farmers Home Administration, Export-Import Bank of the United
States, Small Business Administration, Government National Mortgage
Association, Federal National Mortgage Association, Federal Financing Bank,
General Services Administration, Student Loan Marketing Association, Central
Bank for Cooperatives, Federal Home Loan Banks, Federal Home Loan

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<PAGE> 53
Mortgage Corporation, Federal Intermediate Credit Banks, Federal Land Banks,
Federal Farm Credit Banks, Maritime Administration, Tennessee Valley Authority,
Washington D.C. Armory Board, and International Bank for Reconstruction and
Development. The Funds may also invest in mortgage-related securities issued
or guaranteed by U.S. Government agencies and instrumentalities, including such
instruments as obligations of the Government National Mortgage Association
("GNMA"), Federal National Mortgage Association ("FNMA") and the Federal Home
Loan Mortgage Corporation ("FHLMC").

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<PAGE> 54
MORTGAGE-RELATED AND OTHER ASSET-BACKED SECURITIES.
Mortgage-related securities include fixed and adjustable Mortgage Pass-Through
Certificates, which provide the holder with a pro-rata share of interest and
principal payments on a pool of mortgages, ordinarily on residential
properties. There are a number of important differences among the agencies and
instrumentalities of the U.S. Government that issue mortgage-related securities
and among the securities that they issue. Pass-Through Certificates guaranteed
by GNMA (also known as "Ginnie Maes") are guaranteed as to the timely payment
of principal and interest by GNMA, whose guarantee is backed by the full faith
and credit of the United States. Mortgage-related securities issued by FNMA
include FNMA guaranteed Mortgage Pass-Through Certificates (also known as
"Fannie Maes") which are guaranteed as to timely payment of principal and
interest by FNMA. They are not backed by or entitled to the full faith and
credit of the United States, but are supported by the right of the FNMA to
borrow from the Treasury. Mortgage-related securities issued by FHLMC include
FHLMC Mortgage Participation Certificates (also known as "Freddie Macs").
Freddie Macs are not guaranteed by the United States or by any Federal Home
Loan Banks and do not constitute a debt or obligation of the United States or
of any Federal Home Loan Bank. Freddie Macs entitle the holder to timely
payment of interest, which is guaranteed by the FHLMC. FHLMC guarantees either
ultimate collection or timely payment of all principal payments on the
underlying mortgage loans. When FHLMC does not guarantee timely payment of
principal, FHLMC is required to remit the amount due on account of its
guarantee of ultimate payment of principal no later than one year after it
becomes payable.

TempCash may also invest in classes of collateralized mortgage
obligations ("CMOs") which have a remaining maturity of 397 days or less in
accordance with the requirements of Rule 2a-7 under the 1940 Act. Each class
of a CMO, which frequently elect to be taxed as a real estate mortgage
investment conduit ("REMIC"), represents an ownership interest in, and the
right to receive a specified portion of, the cash flow consisting of interest
and principal on a pool of residential mortgage loans or mortgage pass-through
securities ("Mortgage Assets"). CMOs are issued in multiple classes, each with
a specified fixed or floating interest rate and a final distribution date. The
relative payment rights of the various CMO classes may be structured in many
ways. In most cases, however, payments of principal are applied to the CMO
classes in the order of their respective stated maturities, so that no
principal payments will be made on a CMO class until all other classes having
an earlier stated maturity date are paid in full. These multiple class
securities may be issued or guaranteed by U.S. Government agencies or
instrumentalities, including GNMA, FNMA and FHLMC, or issued by trusts formed
by private originators of, or investors in, mortgage loans. Classes in CMOs
which the Fund may hold are known as "regular" interests. CMOs also issue
"residual" interests, which in general are junior to and more volatile than

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<PAGE> 55
regular interests. TempCash does not intend to purchase residual interests.

As stated in its Prospectus, TempCash may also invest in
non-mortgage asset-backed securities (backed, e.g., by installment sales
contracts, credit card receivables or other assets). Asset-backed securities
are generally issued as pass-through certificates, which represent undivided
fractional ownership interests in an underlying pool of assets, or as debt
instruments, which are also known as collateralized obligations, and are
generally issued as the debt of a special purpose entity organized solely for
the purpose of owning such assets and issuing such debt.

The yield characteristics of mortgage-related and asset-backed
securities differ from traditional debt securities. A major difference is that
the principal amount of the obligations may be prepaid at any time because the
underlying assets (i.e., loans) generally may be prepaid at any time. As a
result, a decrease in interest rates in the market may result in increases in
the level of prepayments as borrowers, particularly mortgagors, refinance and
repay their loans. An increased prepayment rate will have the effect of
shortening the maturity of the security. If the Fund has purchased a
mortgage-related or asset-backed security at a premium, a faster than
anticipated prepayment rate could result in a loss of principal to the extent
of the premium paid. Conversely, an increase in interest rates may result in
lengthening the anticipated maturity because expected prepayments are reduced.
A prepayment rate that is faster than expected will reduce yield to maturity,
while a prepayment rate that is slower than expected may have the opposite
effect of increasing yield to maturity.

In general, the assets supporting non-mortgage asset-backed
securities are of shorter maturity than the assets supporting mortgage-related
securities. Like other fixed-income securities, when interest rates rise the
value of an asset-backed security generally will decline; however, when
interest rates decline, the value of an asset-backed security with prepayment
features may not increase as much as that of other fixed-income securities,
and, as noted above, changes in market rates of interest may accelerate or
retard prepayments and thus affect maturities.

These characteristics may result in a higher level of price
volatility for these assets under certain market conditions. In addition,
while the trading market for short-term mortgages and asset backed securities
is ordinarily quite liquid, in times of financial stress the trading market for
these securities sometimes becomes restricted.

BANKING INDUSTRY OBLIGATIONS. For purposes of TempCash's
investment policies with respect to obligations of issuers in the banking
industry, the assets of a bank or savings institution will

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be deemed to include the assets of its domestic and foreign branches.
Obligations of foreign banks in which TempCash may invest include Eurodollar
Certificates of Deposit ("ECDs") which are U.S. dollar-denominated certificates
of deposit issued by offices of foreign and domestic banks located outside the
United States; Eurodollar Time Deposits ("ETDs") which are U.S.
dollar-denominated deposits in a foreign branch of a U.S. bank or a foreign
bank; Canadian Time Deposits ("CTDs") which are essentially the same as ETDs
except they are issued by Canadian offices of major Canadian banks; and Yankee
Certificates of Deposit ("Yankee CDs") which are U.S. dollar-denominated
certificates of deposit issued by a U.S. branch of a foreign bank and held in
the United States.

SPECIAL CONSIDERATIONS REGARDING FOREIGN INVESTMENTS.
TempCash's investments in the obligations of foreign issuers, including foreign
governments, foreign banks and foreign branches of U.S. banks, may subject
TempCash to investment risks that are different in some respects from those of
investments in obligations of U.S. domestic issuers. These risks may include
future unfavorable political and economic developments, possible withholding
taxes on interest income, seizure or nationalization of foreign deposits,
interest limitations, the possible establishment of exchange controls, or other
governmental restrictions which might affect the payment of principal or
interest on the securities held by the Fund. Additionally, foreign branches of
U.S. banks and foreign banks may be subject to less stringent reserve
requirements and to different accounting, auditing, reporting and recordkeeping
requirements than those applicable to domestic branches of U.S. banks.
TempCash will acquire securities issued by foreign issuers, including foreign
governments, foreign banks and foreign branches of U.S. banks, only when the
Fund's investment adviser believes that the risks associated with such
instruments are minimal.

GUARANTEED INVESTMENT CONTRACTS. Pursuant to its investments
in guaranteed investment contracts and similar funding agreements ("GICs"),
TempCash makes cash contributions to a deposit fund of the insurance company's
general account. The insurance company then credits to the Fund on a monthly
basis guaranteed interest which is based on an index (in most cases this index
is expected to be the Salomon Brothers CD Index). The GICs provide that this
guaranteed interest will not be less than a certain minimum rate. The purchase
price paid for a GIC becomes part of the general assets of the insurance
company, and the contract is paid from the general assets of the insurance
company. Each Fund will only purchase GICs from insurance companies which, at
the time of purchase, are rated "A+" by A.M. Best Company, have assets of $1
billion or more and meet quality and credit standards established by the
adviser under guidelines approved by the Board of Directors. Generally, GICs
are not assignable or transferable without the permission of the issuing
insurance companies, and an active secondary market in GICs does not currently
exist. The

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<PAGE> 57
Fund's investments in GICs are not expected to exceed 5% of its total assets
(at the time of investment) absent unusual market conditions.

MUNICIPAL OBLIGATIONS. As stated in the Funds' Prospectuses,
each Fund may invest in obligations issued by state and local governmental
entities. Municipal securities are issued by various public entities to obtain
funds for various public purposes, including the construction of a wide range
of public facilities, the refunding of outstanding obligations, the payment of
general operating expenses and the extension of loans to public institutions
and facilities. Private activity bonds that are issued by or on behalf of
public authorities to finance various privately operated facilities are
considered to be municipal securities and may be purchased by a Fund.
Dividends paid by a Fund that are derived from interest on municipal securities
would be taxable to that Fund's shareholders for federal income tax purposes.

RESTRICTED AND OTHER ILLIQUID SECURITIES. The SEC has adopted
Rule 144A under the Securities Act of l933 (the "1933 Act") that allows for a
broader institutional trading market for securities otherwise subject to
restriction on resale to the general public. Rule 144A establishes a "safe
harbor" from the registration requirements of the 1933 Act for resales of
certain securities to qualified institutional buyers. The investment adviser
anticipates that the market for certain restricted securities such as
institutional commercial paper will expand further as a result of this
regulation and the development of automated systems for the trading, clearance
and settlement of unregistered securities of domestic and foreign issuers, such
as the PORTAL System sponsored by the National Association of Securities
Dealers.

Each Fund's investment adviser will monitor the liquidity of
restricted and other illiquid securities under the supervision of the Board of
Directors. In reaching liquidity decisions, the investment adviser will
consider, inter alia, the following factors: (1) the unregistered nature of a
Rule 144A security; (2) the frequency of trades and quotes for the Rule 144A
security; (3) the number of dealers wishing to purchase or sell the Rule 144A
security and the number of other potential purchasers; (4) dealer undertakings
to make a market in the Rule 144A security; (5) the trading markets for the
Rule 144A security; and (6) the nature of the Rule 144A security and the nature
of the marketplace trades (e.g., the time needed to dispose of the Rule 144A
security, the method of soliciting offers and the mechanics of the transfer).

NRSRO RATINGS. The ratings by NRSROs represent their
respective opinions as to the quality of the obligations they undertake to
rate. Ratings, however, are general and are not absolute standards of quality.
Consequently, obligations with the

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<PAGE> 58
same rating, maturity, and interest rate may have different market prices. The
Appendix to this Statement of Additional Information contains a description of
the relevant rating symbols used by NRSROs for commercial paper that may be
purchased by each Fund.

INVESTMENT LIMITATIONS

The Funds' Prospectuses summarize certain investment
limitations that may not be changed without the affirmative vote of the holders
of a majority of such Fund's outstanding shares (as defined below under
"Miscellaneous"). Below is a complete list of each Fund's investment
limitations that may not be changed without such a vote of shareholders.

A Fund may not:

1. Purchase any securities other than so-called money market
instruments, including U.S. Treasury Bills; other obligations issued or
guaranteed by the federal government, its agencies or instrumentalities;
certificates of deposit; bankers' acceptances; and commercial paper (including
variable rate demand notes); some of which may be subject to repurchase
agreements, but each Fund may make interest-bearing savings deposits in
commercial and savings banks in amounts not in excess of 5% of the value of the
Fund's assets, and TempCash may make time deposits.

2. Borrow money, except from banks for temporary purposes and
then in amounts not in excess of 10% of the value of a Fund's assets at the
time of such borrowing; or mortgage, pledge or hypothecate any assets except in
connection with any such borrowing and in amounts not in excess of the lesser
of the dollar amounts borrowed or 10% of the value of the Fund's assets at the
time of such borrowing. (A loan limitation in excess of 5% is generally
associated with a leveraged fund, but since a Fund anticipates paying interest
on borrowed money at rates comparable to its yield, the potential for improving
income by such borrowing is remote. This borrowing provision is included
solely to facilitate the orderly sale of portfolio securities to accommodate
abnormally heavy redemption requests if they should occur and is not for
leverage purposes.)

3. With respect to TempFund, purchase any securities which
would cause 25% or more of the value of its total assets at the time of such
purchase to be invested in the securities of one or more issuers conducting
their principal business activities in the same industry, provided that (a)
there is no limitation with respect to investments in U.S. Treasury Bills,
other obligations issued or guaranteed by the federal government, its agencies
and instrumentalities, certificates of deposit, and bankers' acceptances and
(b) neither all finance companies, as a group, nor

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<PAGE> 59
all utility companies, as a group, are considered a single industry for
purposes of this policy.

4. With respect to TempCash, purchase any securities
which would cause, at the time of purchase, less than 25% of the value of its
total assets to be invested in obligations of issuers in the banking industry
or in obligations, such as repurchase agreements, secured by such obligations
(unless the Fund is in a temporary defensive position) or which would cause, at
the time of purchase, 25% or more of the value of its total assets to be
invested in the obligations of issuers in any other industry, provided that (a)
there is no limitation with respect to investments in U.S. Treasury Bills and
other obligations issued or guaranteed by the federal government, its agencies
and instrumentalities and (b) neither all finance companies, as a group, nor
all utility companies, as a group, are considered a single industry for
purposes of this policy.

5. Purchase securities of any one issuer, other than the
federal government, if immediately after such purchase more than 5% of the
value of its total assets would be invested in such issuer, except that up to
25% of the value of a Fund's total assets may be invested without regard to
such 5% limitation.

6. Make loans, except that a Fund may purchase or hold debt
instruments in accordance with its investment objective and policies, and may
enter into repurchase agreements with respect to commercial paper, certificates
of deposit and obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.

7. Purchase or sell commodities or commodity contracts, or
invest in oil, gas or mineral exploration or development programs.

8. Acquire voting securities of any issuer or acquire
securities of other investment companies.

9. Purchase or sell real estate. However, each Fund may
purchase commercial paper issued by companies which invest in real estate or
interests therein.

10. Purchase securities on margin, make short sales of
securities or maintain a short position.

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<PAGE> 60
11. Act as an underwriter of securities.

* * *

The percentage restrictions on borrowing and collateralization
contained in the second investment limitation above are based on a Fund's total
assets, and any interest paid by that Fund on its borrowings pursuant to this
investment limitation would reduce the Fund's income. It is currently each
Fund's policy not to purchase portfolio securities while borrowings in excess
of 5% of that Fund's net assets are outstanding. Further, with respect to the
above-stated third limitation with respect to TempFund and the fourth
limitation with respect to TempCash, each Fund will consider wholly-owned
finance companies to be in the industries of their parents, if their activities
are primarily related to financing the activities of their parents, and will
divide utility companies according to their services, for example, gas, gas
transmission, electric and gas, electric, and telephone will each be considered
a separate industry. The policy and practices stated in this paragraph may be
changed without the affirmative vote of the holders of a majority of a Fund's
outstanding shares, but any such change may require the approval of the SEC and
would be disclosed in such Fund's Prospectuses prior to implementation.

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

IN GENERAL

Information on how to purchase and redeem each Fund's shares
is included in the applicable Prospectuses. The issuance of shares is recorded
on a Fund's books, and share certificates are not issued unless expressly
requested in writing. Certificates are not issued for fractional shares.

The regulations of the Comptroller of the Currency provide
that funds held in a fiduciary capacity by a national bank approved by the
Comptroller to exercise fiduciary powers must be invested in accordance with
the instrument establishing the fiduciary relationship and local law. The
Company believes that the purchase of TempFund and TempCash shares by such
national banks acting on behalf of their fiduciary accounts is not contrary to
applicable regulations if consistent with the particular account and proper
under the law governing the administration of the account.

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<PAGE> 61

Prior to effecting a redemption of shares represented by
certificates, PFPC, the Company's transfer agent, must have received such
certificates at its principal office. All such certificates must be endorsed
by the redeeming shareholder or accompanied by a signed stock power, in each
instance with the signature guaranteed by a commercial bank or a member of a
major stock exchange, or other eligible guarantor organization, unless other
arrangements satisfactory to a Fund have previously been made. A Fund may
require any additional information reasonably necessary to evidence that a
redemption has been duly authorized.

Under the 1940 Act, a Fund may suspend the right of redemption
or postpone the date of payment upon redemption for any period during which the
New York Stock Exchange is closed, other than customary weekend and holiday
closings, or during which trading on said Exchange is restricted, or during
which (as determined by the SEC by rule or regulation) an emergency exists as a
result of which disposal or valuation of portfolio securities is not reasonably
practicable, or for such other periods as the SEC may permit. (A Fund may also
suspend or postpone the recordation of the transfer of its shares upon the
occurrence of any of the foregoing conditions.)

In addition, a Fund may redeem shares involuntarily in certain
other instances if the Board of Directors determines that failure to redeem may
have material adverse consequences to that Fund's shareholders in general.
Each Fund is obligated to redeem shares solely in cash up to $250,000 or 1% of
such Fund's net asset value, whichever is less, for any one shareholder within
a 90-day period. Any redemption beyond this amount will also be in cash unless
the Board of Directors determines that conditions exist which make payment of
redemption proceeds wholly in cash unwise or undesirable. In such a case, a
Fund may make payment wholly or partly in securities or other property, valued
in the same way as that Fund determines net asset value. (See "Net Asset
Value" below for an example of when such redemption or form of payment might be
appropriate.) Redemption in kind is not as liquid as a cash redemption.
Shareholders who receive a redemption in kind may incur transaction costs, if
they sell such securities or property, and may receive less than the redemption
value of such securities or property upon sale, particularly where such
securities are sold prior to maturity.

Any institution purchasing shares on behalf of separate
accounts will be required to hold the shares in a single nominee name (a
"Master Account"). Institutions investing in more than one of the Company's
portfolios, or classes or sub-classes of shares, must maintain a separate
Master Account for each Fund's class or

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sub-class of shares. Institutions may also arrange with PFPC for certain
sub-accounting services (such as purchase, redemption, and dividend
recordkeeping). Sub-accounts may be established by name or number either when
the Master Account is opened or later.

NET ASSET VALUE

As stated in each Fund's Prospectus, each Fund's net asset
value per share is calculated by dividing the total value of the assets
belonging to a Fund, adding the value of all of the Fund's portfolio securities
and other assets belonging to that Fund, subtracting the liabilities charged to
that Fund, and dividing the result by the total number of that Fund's shares
outstanding (irrespective of class or sub-class). "Assets belonging to" a Fund
consist of the consideration received upon the issuance of Fund shares together
with all income, earnings, profits and proceeds derived from the investment
thereof, including any proceeds from the sale of such investments, any funds or
payments derived from any reinvestment of such proceeds, and a portion of any
general assets of the Company not belonging to a particular portfolio. Assets
belonging to a Fund are charged with the direct liabilities of that Fund and
with a share of the general liabilities of the Company allocated on a daily
basis in proportion to the relative net assets of each of the Company's
portfolios. Determinations made in good faith and in accordance with generally
accepted accounting principles by the Company's Board of Directors as to the
allocation of any assets or liabilities with respect to a Fund are conclusive.

As stated in the Funds' Prospectuses, in computing the net
asset value of its shares for purposes of sales and redemptions, each Fund uses
the amortized cost method of valuation. Under this method, a Fund values each
of its portfolio securities at cost on the date of purchase and thereafter
assumes a constant proportionate amortization of any discount or premium until
maturity of the security. As a result, the value of a portfolio security for
purposes of determining net asset value normally does not change in response to
fluctuating interest rates. While the amortized cost method seems to provide
certainty in portfolio valuation, it may result in valuations of a Fund's
securities which are higher or lower than the market value of such securities.

In connection with its use of amortized cost valuation, each
Fund limits the dollar-weighted average maturity of its portfolio to not more
than 90 days and does not purchase any instrument with a remaining maturity of
more than thirteen months (397 days) (with certain exceptions). The Company's
Board of Directors has also established procedures, pursuant to rules
promulgated by the SEC, that are intended to stabilize each Fund's net asset
value per share for purposes of sales and redemptions at $1.00. Such
procedures include the determination, at such intervals as the Board deems
appropriate, of the extent, if any, to

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<PAGE> 63
which a Fund's net asset value per share calculated by using available market
quotations deviates from $1.00 per share. In the event such deviation exceeds
1/2 of 1%, the Board will promptly consider what action, if any, should be
initiated. If the Board believes that the amount of any deviation from a
Fund's $1.00 amortized cost price per share may result in material dilution or
other unfair results to investors or existing shareholders, it will take such
steps as it considers appropriate to eliminate or reduce to the extent
reasonably practicable any such dilution or unfair results. These steps may
include selling portfolio instruments prior to maturity to realize capital
gains or losses or to shorten a Fund's average portfolio maturity, redeeming
shares in kind, reducing or withholding dividends, or utilizing a net asset
value per share determined by using available market quotations.

MANAGEMENT OF THE FUNDS

DIRECTORS AND OFFICERS

The Company's directors and executive officers, their
addresses, principal occupations during the past five years and other
affiliations are as follows:

<TABLE>
<CAPTION>
Principal Occupations
Position with During Past 5 Years and
Name and Address the Company Other Affiliations
---------------- -------------- ------------------------
<S> <C> <C>
PHILIP E. COLDWELL(3)(4) Director Economic Consultant;
Coldwell Financial Member of the Board of
Consultants Governors of the Federal
3330 Southwestern Blvd. Reserve System, 1974 to 1980;
Dallas, TX 75225 President, Federal Reserve Bank
Age: 73 of Dallas, 1968 to 1974; Director, Maxus Energy
Corporation (energy and chemical products) 1987
to 1993; Director, Diamond Shamrock Corporation
(energy and chemical products) until 1987.

ROBERT R. FORTUNE(2)(3)(4) Director Financial Consultant;
2920 Ritter Lane Chairman, President, and Chief
Allentown, PA 18104 Executive Officer, Associated
Age: 79 Electric & Gas Insurance Services Limited, from
July 1984 to July 1993; Member of the Financial
Executives Institute and American Institute of
Certified Public Accountants; Director,
Prudential Utility Fund, Inc. and Prudential
Structured Maturity Fund, Inc.
</TABLE>

-15-
<PAGE> 64
<TABLE>
<CAPTION>
Principal Occupations
Position with During Past 5 Years and
Name and Address the Company Other Affiliations
---------------- -------------- ------------------------
<S> <C> <C>
RODNEY D. JOHNSON(4) Director President, Fairmount Capital
Fairmount Capital Advisors, Inc. (financial
Advisors, Inc. advising), since 1987;
1435 Walnut Street Treasurer, North Philadelphia
Drexel Building Health System (formerly Girard
Philadelphia, PA 19102 Medical Center), 1988 to 1992;
Age: 54 Member, Board of Education, School District of
Philadelphia, 1983 to 1988; Treasurer, Cascade
Aphasia Center, 1984 to 1988.

G. WILLING PEPPER(1)(2) Chairman of the Retired; Chairman of the
128 Springton Lake Road Board, Board, The Institute for
Media, PA 19063 President, Cancer Research until 1979;
Age: 87 and Director Director, Philadelphia National
Bank until 1978; President, Scott Paper
Company, 1971 to 1973; Chairman of the Board,
Specialty Composites Corporation until May 1984.

EDWARD J. ROACH Vice President Certified Public Accountant;
Bellevue Park Corporate and Treasurer Partner of the accounting firm
Center of Main Hurdman until 1981;
400 Bellevue Parkway Vice Chairman of the Board, Fox
</TABLE>

-16-
<PAGE> 65

<TABLE>
<CAPTION>
Principal Occupations
Position with During Past 5 Years and
Name and Address the Company Other Affiliations
---------------- -------------- ------------------------
<S> <C> <C>
Suite 100 Chase Cancer Center;
Wilmington, DE 19809 Trustee Emeritus,
Age: 71 Pennsylvania School for the Deaf; Trustee,
Immaculata College, 1983-1994; President or Vice
President and Treasurer of various investment
companies advised by PNC Institutional
Management Corporation; Director, The
Bradford Funds, Inc.

W. BRUCE McCONNEL, III Secretary Partner of the law firm of
Philadelphia National Bank Drinker Biddle & Reath,
Bldg. Philadelphia, Pennsylvania.
1345 Chestnut Street
Philadelphia, PA 19107-3496
Age: 52

- --------------------
</TABLE>

(1) This director is considered by the Company to be an "interested
person" of the Company as defined in the 1940 Act.

(2) Executive Committee Member.

(3) Audit Committee Member.

(4) Nominating Committee Member.

During intervals between meetings of the Board, the Executive
Committee may exercise the authority of the Board of Directors in the
management of the Company's business to the extent permitted by law.

Each director of the Company serves as a trustee of Trust for
Federal Securities ("Fed"), Municipal Fund for Temporary Investment ("Muni")
and Provident Institutional Funds, Inc. ("PIF"). In addition, Messrs. Fortune
and Pepper are directors of Independence Square Income Securities, Inc.
("ISIS") and Managing General Partners of Chestnut Street Exchange Fund
("Chestnut"); Messrs. Johnson and Pepper are directors of Municipal Fund for
California Investors, Inc. ("Cal Muni"); and Mr. Johnson is a director of
Municipal Fund for New York Investors, Inc. ("New York Muni") and a director of
International Dollar Reserve Fund ("IDR").

Each of the Company's officers, with the exception of Mr.
McConnel, holds like offices with Fed, Muni and PIF. In addition, Mr. McConnel
is Secretary of Fed and PIF; Mr. Roach is Treasurer of Chestnut, President and

-17-
<PAGE> 66
Treasurer of The RBB Fund, Inc. and New York Muni, and Vice President and
Treasurer of ISIS and Cal Muni; and Mr. Pepper is President and Chairman of the
Board of Cal Muni. Each of the investment companies named above receives
various advisory and other services from PIMC and/or PNC Bank. Of the
above-mentioned funds, the Distributor or an affiliate provides distribution
services to Fed, Muni, Compass Capital Funds(R) ("Compass"), Cal Muni, New York
Muni, PIF and IDR. Of the above-mentioned funds, PFPC and/or PDI (or an
affiliate) provide administrative services to Fed, Muni, Cal Muni, New York
Muni, Compass, PIF and IDR.

<TABLE>
<CAPTION>
TOTAL
PENSION OR COMPENSATION
RETIREMENT FROM
AGGREGATE BENEFITS ESTIMATED REGISTRANT AND
COMPENSATION ACCRUED AS ANNUAL FUND COMPLEX1
NAME OF PERSON, FROM PART OF FUND BENEFITS UPON PAID TO
POSITION REGISTRANT EXPENSES RETIREMENT TRUSTEES
-------- ---------- -------- ---------- --------
<S> <C> <C> <C> <C>
Philip E. Coldwell, $13,700 n/a n/a $46,200(4)2
Trustee

Robert R. Fortune, $13,700 n/a n/a $66,200(6)2
Trustee

Rodney D. Johnson, $13,700 n/a n/a $58,450(6)2
Trustee

G. Willing Pepper, $22,000 n/a n/a $98,850(7)2
Chairman of the Board
and President

Anthony Santomero, $13,000 n/a n/a $51,000(6)2
Trustee3

David R. Wilmerding, $15,366 n/a n/a $63,200(7)2
Vice Chairman of the
Board3
</TABLE>

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

1. A Fund complex means two or more investment companies that hold
themselves out to investors as related companies for purposes
of investment and investor services, or have a common
investment adviser or have an investment adviser that is an
affiliated person of the investment adviser of any of the
other investment companies.

2. Total number of such other investment companies director
serves on within the Fund Complex.

3. These directors resigned from the board of directors of the
Company on January 4, 1996.

-18-
<PAGE> 67

For the Company's fiscal year ended September 30, 1995, the
Company paid a total of $128,739 to its officers and directors in all
capacities, of which $71,960 was allocated to TempFund and $56,779 was
allocated to TempCash. In addition, the Company contributed $3,186 for the
last fiscal year to its retirement plan for employees (who included Mr. Roach),
of which $1,781 was allocated to TempFund and $1,405 was allocated to TempCash.
Drinker Biddle & Reath, of which Mr. McConnel is a partner, receives legal fees
as counsel to the Company. No employee of PDI, PIMC, PFPC or PNC Bank receives
any compensation from the Company for acting as an officer or director of the
Company. The directors and officers of the Company as a group own less than 1%
of the shares of each of the Company's portfolios.

By virtue of the responsibilities assumed by PDI, PIMC and PNC
Bank under their respective agreements with the Company, the Company itself
requires only one part-time employee in addition to its officers.

INVESTMENT ADVISER AND SUB-ADVISER

The advisory and sub-advisory services provided by PIMC and
PNC Bank are described in the Funds' Prospectuses. For the advisory services
provided and expenses assumed by it, PIMC is entitled to receive fees, computed
daily and payable monthly, at the following annual rates:

<TABLE>
<CAPTION>
TempFund
--------

Annual Fee Average Net Assets
- ---------- ------------------
<S> <C>
.175% ............................of the first $1 billion
.150% ............................ of the next $1 billion
.125% ............................ of the next $1 billion
.100% ............................ of the next $1 billion
.095% ............................ of the next $1 billion
.090% ............................ of the next $1 billion
.080% ............................ of the next $1 billion
.075% ............................ of the next $1 billion
.070% .................of amounts in excess of $8 billion.
</TABLE>

-19-
<PAGE> 68

<TABLE>
<CAPTION>
TempCash
--------

Annual Fee Average Net Assets
- ---------- ------------------
<S> <C>
.175% ............................of the first $1 billion
.150% ............................ of the next $1 billion
.125% ............................ of the next $1 billion
.100% ............................ of the next $1 billion
.095% ............................ of the next $1 billion
.090% ............................ of the next $1 billion
.085% ............................ of the next $1 billion
.080% .................of amounts in excess of $7 billion.
</TABLE>

PIMC and the administrators may from time to time reduce their
fees to ensure that TempFund's and TempCash's respective ordinary operating
expenses (excluding interest, taxes, brokerage fees, fees paid to Service
Organizations pursuant to Servicing Agreements, and extraordinary expenses) do
not exceed a specified percentage of each Portfolio's average net assets. PIMC
and the administrators have agreed that if, in any fiscal year, the expenses
borne by a Fund exceed the applicable expense limitations imposed by the
securities regulations of any state in which shares of that Fund are registered
or qualified for sale to the public, they will each reimburse that Fund for a
portion of any such excess expense in an amount equal to the portion that the
administration fees otherwise payable by the Fund to the administrators bear to
the total amount of the investment advisory and administrator fees otherwise
payable by the Fund. To each Fund's knowledge, of the expense limitations in
effect on the date of this Statement of Additional Information, none is more
restrictive than two and one-half percent (2-1/2%) of the first $30 million of
a Fund's average annual net assets, two percent (2%) of the next $70 million of
the average annual net assets, and one and one-half percent (1-1/2%) of the
remaining average annual net assets.

For TempFund's fiscal years ended September 30, 1993, 1994 and
1995, such Fund paid fees for advisory services aggregating $9,286,771,
$7,294,656 and $6,840,438 respectively, pursuant to advisory agreements then in
effect. For such Fund's fiscal years ended September 30, 1993, 1994 and 1995,
the adviser voluntarily waived fees in the amount of $-0-, $612,404 and
$942,342. For the same periods, TempCash paid $1,192,919, $1,652,235 and
$5,277,478, respectively, in advisory fees to PIMC, after voluntary waivers of
$1,347,174, $2,119,803 and $2,595,378, respectively, although the expense
limitations then in effect were not exceeded.

-20-
<PAGE> 69

BANKING LAWS

Certain banking laws and regulations with respect to
investment companies are discussed in each Fund's Prospectuses. PIMC, PNC Bank
and PFPC believe that they may perform the services for the Funds contemplated
by their respective agreements, Prospectuses and this Statement of Additional
Information without violation of applicable banking laws or regulations. It
should be noted, however, that future changes in legal requirements relating to
the permissible activities of banks and their affiliates, as well as further
interpretations of present requirements, could prevent PIMC and PFPC from
continuing to perform such services for the Funds and PNC Bank from continuing
to perform such services for PIMC and the Funds. If PIMC, PFPC or PNC Bank
were prohibited from continuing to perform such services, it is expected that
the Company's Board of Directors would recommend that the Funds enter into new
agreements with other qualified firms. Any new advisory agreement would be
subject to shareholder approval.

In addition, state securities laws on this issue may differ
from the interpretations of federal law expressed herein and banks and
financial institutions may be required to register as dealers pursuant to state
law.

ADMINISTRATORS

As the Funds' administrators, PFPC and PDI have agreed to
provide the following services: (i) assist generally in supervising the Funds'
operations, including providing a Wilmington, Delaware order-taking facility
with toll-free IN-WATS telephone lines, providing for the preparing,
supervising and mailing of purchase and redemption order confirmations to
shareholders of record, providing and supervising the operation of an automated
data processing system to process purchase and redemption orders, maintaining a
back-up procedure to reconstruct lost purchase and redemption data, providing
information concerning the Funds to their shareholders of record, handling
shareholder problems, providing (through PDI) the services of employees to
preserve and strengthen shareholder relations and monitoring the arrangements
pertaining to the Funds' agreements with Service Organizations; (ii) assure
that persons are available to receive and transmit purchase and redemption
orders; (iii) participate in the periodic updating of the Funds' prospectuses;
(iv) assist in the Funds' Wilmington, Delaware office; (v) accumulate
information for and coordinate the preparation of reports to the Funds'
shareholders and the SEC; (vi) maintain the registration or qualification of
the Funds' shares for sale under state securities laws; (vii) review and
provide advice with respect to all sales literature of the Funds; and (viii)
assist in the monitoring of regulatory and legislative developments which may
affect the Company, participate in counseling and assisting the Company in
relation to routine

-21-
<PAGE> 70

regulatory examinations and investigations, and work with the Company's counsel
in connection with regulatory matters and litigation.

For their administrative services, the administrators are
entitled jointly to receive fees, computed daily and payable monthly, as
described above determined in the same manner as PIMC's advisory fee set forth
above. As stated in the Prospectuses, each administrator is also reimbursed
for its reasonable out-of-pocket expenses incurred by it in connection with the
Fund's computer access program. For information regarding the administrators'
obligation to reimburse the Funds in the event their expenses exceed certain
prescribed limits, see "Investment Adviser and Sub-Adviser" above. The
administrators voluntarily waived $942,342 and $2,595,378 in administrative
fees for TempFund and TempCash, respectively, during the last fiscal year. Any
fees waived by the administrators with respect to a particular fiscal year are
not recoverable.

PFPC, a wholly-owned, indirect subsidiary of PNC Bank, and PDI
provide administrative and in some cases sub-administrative services to
investment companies which are distributed by PDI or its affiliates.

DISTRIBUTOR

PDI acts as the distributor of the Fund's shares. Each Fund's
shares are sold on a continuous basis by the distributor as agent, although it
is not obliged to sell any particular amount of shares. The distributor pays
the cost of printing and distributing prospectuses to persons who are not
shareholders of the Funds (excluding preparation and printing expenses
necessary for the continued registration of the Fund shares). The distributor
shall prepare or review, provide advice with respect to, and file with the
federal and state agencies or other organizations as required by federal, state
or other applicable laws and regulations, all sales literature (advertisements,
brochures and shareholder communications) for each of the Funds and any class
or subclass thereof. No compensation is payable by the Fund to the distributor
for its distribution services. PDI is a Delaware corporation with its
principal place of business located at 259 Radnor-Chester Road, Suite 120,
Radnor, Pennsylvania 19087.

CUSTODIAN AND TRANSFER AGENT

Pursuant to a Custodian Agreement, PNC Bank serves as the
Fund's custodian, holding a Fund's portfolio securities, cash and other
property. Under the Custodian Agreement, PNC Bank has agreed

-22-
<PAGE> 71

to provide the following services: (i) maintain a separate account or accounts
in the name of a Fund; (ii) hold and disburse portfolio securities on account
of a Fund; (iii) collect and make disbursements of money on behalf of a Fund;
(iv) collect and receive all income and other payments and distributions on
account of a Fund's portfolio securities; and (v) make periodic reports to the
Board of Directors concerning a Fund's operations.

PNC Bank is also authorized to select one or more banks or
trust companies to serve as sub-custodian on behalf of a Fund, provided that
PNC Bank shall remain responsible for the performance of all of its duties
under the Custodian Agreement and shall hold each Fund harmless from the acts
and omissions of any bank or trust company serving as sub-custodian chosen by
PNC Bank.

PFPC also serves as transfer agent, registrar and dividend
disbursing agent to each Fund pursuant to a Transfer Agency Agreement. Under
the Agreement, PFPC has agreed to provide the following services: (i) maintain
a separate account or accounts in the name of a Fund; (ii) issue, transfer and
redeem Fund shares; (iii) transmit all communications by a Fund to its
shareholders of record, including reports to shareholders, dividend and
distribution notices and proxy material for its meetings of shareholders; (iv)
respond to correspondence by shareholders, security brokers and others relating
to its duties; (v) maintain shareholder accounts and sub-accounts; (vi) provide
installation and other services in connection with the Funds' computer access
program maintained to facilitate shareholder access to a Fund; (vii) send each
shareholder of record a monthly statement showing the total number of a Fund's
shares owned as of the last business day of the month (as well as the dividends
paid during the current month and year); and (viii) provide each shareholder of
record with a daily transaction report for each day on which a transaction
occurs in the shareholder's Master Account with a Fund. Further, an
institution establishing sub-accounts with PFPC is provided with a daily
transaction report for each day on which a transaction occurs in a sub-account
and, as of the last calendar day of each month, a report which sets forth the
share balances for the sub-accounts at the beginning and end of the month and
income paid or reinvested during the month. Finally, PFPC provides each
shareholder of record with copies of all information relating to dividends and
distributions which is required to be filed with the Internal Revenue Service
and other appropriate taxing authorities.

-23-
<PAGE> 72

Pursuant to the Custodian Agreement, each Fund pays PNC Bank
an annual fee, calculated daily on the average daily gross assets and paid
monthly, at the rate of $.25 for each $1000 of the first $250 million, $.20 for
each $1000 on the next $250 million, $.15 for each $1000 on the next $500
million, $.09 for each $1000 on the next $2 billion, and $.08 for each $1000 on
amounts over $3 billion, plus $15.00 for each purchase, sale, or delivery of
fixed income securities (other than "Money Market" obligations) and $40 for
each interest collection or claim item. For transfer agency and dividend
disbursing services, each Fund pays PFPC fees at the annual rate of $12.00 per
account and sub-account maintained by PFPC plus $1.00 for each purchase or
redemption transaction by an account (other than a purchase transaction made in
connection with the automatic reinvestment of dividends). Payments to PFPC for
sub-accounting services provided by others are limited to the amount which PFPC
pays to others for such services. In addition, each Fund reimburses PNC Bank
and PFPC for out-of-pocket expenses related to such services. PNC Bank
maintains a principal business address at Broad and Chestnut Streets,
Philadelphia, Pennsylvania 19102.

SERVICE ORGANIZATIONS

As stated in the Funds' Prospectuses, a Fund will enter into
an agreement with banks, savings and loan associations, and other financial
institutions, including affiliates of PNC Bank Corp. ("Service Organizations"),
requiring them to provide administrative support services to their customers
("Customers") who beneficially own a Fund's Dollar Shares in consideration of
such Fund's payment of .25% (on an annualized basis) of the average daily net
asset value of that Fund's Dollar Shares held by the Service Organization for
the benefit of its Customers. Such services include: (i) aggregating and
processing purchase and redemption requests from Customers and placing net
purchase and redemption orders with PFPC; (ii) providing Customers with a
service that invests the assets of their accounts in a Fund's Dollar Shares;
(iii) processing dividend payments from a Fund on behalf of Customers; (iv)
providing information periodically to Customers showing their positions in a
Fund's Dollar Shares; (v) arranging for bank wires; (vi) responding to Customer
inquiries relating to the services performed by the Service Organization; (vii)
providing sub-accounting with respect to a Fund's Dollar Shares beneficially
owned by Customers or the information necessary for sub-accounting; (viii)
forwarding shareholder communications from a Fund (such as proxies, shareholder
reports, annual and semi-annual financial statements, and dividend,
distribution and tax notices) to Customers, if required by law; and (ix) other
similar services if requested by a Fund. For the fiscal year ended September
30, 1995, the Company paid $342,500 (or .72% of the total) and $127,205 (or .28%
of the total) in servicing fees to BHC Securities, Inc., and PNC Securities
Corp., respectively, affiliates of the Company's investment

-24-
<PAGE> 73

adviser, pursuant to Servicing Agreements in effect during such period.

Each Fund's agreements with Service Organizations are governed
by a Shareholder Services Plan (the "Plan") that has been adopted by the
Company's Board of Directors pursuant to an exemptive order granted by the SEC
in connection with the offering of a Fund's Dollar Shares. Pursuant to the
Plan, the Board of Directors reviews, at least quarterly, a written report of
the amounts expended under each Fund's agreements with Service Organizations
and the purposes for which the expenditures were made. In addition, a Fund's
arrangements with Service Organizations must be approved annually by a majority
of the Company's directors, including a majority of the directors who are not
"interested persons" of the Company as defined in the 1940 Act and have no
direct or indirect financial interest in such arrangements.

The Board of Directors has approved each Fund's arrangements
with Service Organizations based on information provided by the Company's
service contractors and others that there is a reasonable likelihood that the
arrangements will benefit such Fund and its shareholders by affording the Fund
greater flexibility in connection with the servicing of the accounts of the
beneficial owners of its shares in an efficient manner. Any material amendment
to a Fund's arrangements with Service Organizations must be approved by a
majority of the Company's Board of Directors (including a majority of the
non-interested directors). So long as a Fund's arrangements with Service
Organizations are in effect, the selection and nomination of the members of the
Company's Board of Directors who are not "interested persons" (as defined in
the 1940 Act) of the Company will be committed to the discretion of such
non-interested directors.

EXPENSES

A Fund's expenses include taxes, interest, fees and salaries
of the Company's directors and officers who are not directors, officers or
employees of the Company's service contractors, SEC fees, state securities
qualification fees, costs of preparing and printing prospectuses for regulatory
purposes and for distribution to shareholders, advisory and administration
fees, charges of the custodian and of the transfer and dividend disbursing
agent, Service Organization fees, costs of the Funds' computer access program,
certain insurance premiums, outside auditing and legal expenses, costs of
shareholder reports and shareholder meetings and any extraordinary expenses. A
Fund also pays for brokerage fees and commissions (if any) in connection with
the purchase and sale of portfolio securities.

-25-
<PAGE> 74

ADDITIONAL INFORMATION CONCERNING TAXES

The following summarizes certain additional tax considerations
generally affecting a Fund and its shareholders that are not described in the
Funds' Prospectuses. No attempt is made to present a detailed explanation of
the tax treatment of a Fund or its shareholders or possible legislative
changes, and the discussion here and in the applicable Prospectuses is not
intended as a substitute for careful tax planning.

As stated in each Prospectus, each Fund is treated as a
separate corporate entity under the Code and intends to qualify each year as a
regulated investment company under the Code. In order to so qualify for a
taxable year, a Fund must satisfy the distribution requirement described in the
Prospectuses, derive at least 90% of its gross income for the year from certain
qualifying sources, comply with certain diversification requirements, and
derive less than 30% of its gross income for the year from the sale or other
disposition of securities and certain other investments held for less than
three months. Interest (including original issue discount and accrued market
discount) received by a Fund at maturity or disposition of a security held for
less than three months will not be treated as gross income derived from the
sale or other disposition of such security within the meaning of the 30%
requirement. However, any income in excess of such interest will be treated as
gross income from the sale or other disposition of securities for this purpose.

A 4% non-deductible excise tax is imposed on regulated
investment companies that fail currently to distribute an amount equal to
specified percentages of their ordinary taxable income and capital gain net
income (excess of capital gains over capital losses). Each Fund intends to
make sufficient distributions or deemed distributions of its ordinary taxable
income and any capital gain net income prior to the end of each calendar year
to avoid liability for this excise tax.

If for any taxable year a Fund does not qualify for tax
treatment as a regulated investment company, all of that Fund's taxable income
will be subject to tax at regular corporate rates without any deduction for
distributions to Fund shareholders. In such event, dividend distributions to
shareholders would be taxable as ordinary income to the extent of that Fund's
earnings and profits and would be eligible for the dividends received deduction
in the case of corporate shareholders.

Each Fund will be required in certain cases to withhold and
remit to the U.S. Treasury 31% of taxable dividends or 31% of gross proceeds
paid to a shareholder that has failed to provide a correct tax identification
number in the manner required, that is subject to withholding by the Internal
Revenue Service for failure properly to include on its return payments of
taxable interest or

-26-
<PAGE> 75

dividends, or that has failed to certify to the Fund that it is not subject to
backup withholding when required to do so or that it is an "exempt recipient."

Although each Fund expects to qualify as a regulated
investment company and to be relieved of all or substantially all federal
income tax, depending upon the extent of its activities in states and
localities in which its offices are maintained, in which its agents or
independent contractors are located or in which it is otherwise deemed to be
conducting business, a Fund may be subject to the tax laws of such states or
localities. In addition, in those states and localities which have income tax
laws, the treatment of the Fund and its shareholders under such laws may differ
from the treatment under federal income tax laws. Shareholders are advised to
consult their tax advisors concerning the application of state and local taxes.

The foregoing discussion is based on federal tax laws and
regulations which are in effect on the date of this Statement of Additional
Information; such laws and regulations may be changed by legislative or
administrative action.

DIVIDENDS

GENERAL

Each Fund's net investment income for dividend purposes
consists of (i) interest accrued and original issue discount earned on that
Fund's assets, (ii) plus the amortization of market discount and minus the
amortization of market premium on such assets and (iii) less accrued expenses
directly attributable to that Fund and the general expenses (e.g. legal,
accounting and directors' fees) of the Company prorated to such Fund on the
basis of its relative net assets. Any realized short-term capital gains may
also be distributed as dividends to Fund shareholders. In addition, a Fund's
Dollar Shares bear exclusively the expense of fees paid to Service
Organizations. (See "Management of the Funds -- Service Organizations.")

As stated, the Company uses its best efforts to maintain the
net asset value per share of each Fund at $1.00. As a result of a significant
expense or realized or unrealized loss incurred by either Fund, it is possible
that the Fund's net asset value per share may fall below $1.00.

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<PAGE> 76

ADDITIONAL YIELD INFORMATION

The "yields" and "effective yields" are calculated separately
for TempFund and TempFund Dollar Shares and for TempCash and TempCash Dollar
Shares. The seven-day yield for each class or sub-class of shares in a Fund is
calculated by determining the net change in the value of a hypothetical
pre-existing account in a Fund having a balance of one share of the class
involved at the beginning of the period, dividing the net change by the value
of the account at the beginning of the period to obtain the base period return,
and multiplying the base period return by 365/7. The net change in the value
of an account in a Fund includes the value of additional shares purchased with
dividends from the original share and dividends declared on the original share
and any such additional shares, net of all fees charged to all shareholder
accounts in proportion to the length of the base period and the Fund's average
account size, but does not include gains and losses or unrealized appreciation
and depreciation. In addition, the effective annualized yield may be computed
on a compounded basis (calculated as described above) by adding 1 to the base
period return, raising the sum to a power equal to 365/7, and subtracting 1
from the result. Similarly, based on the calculations described above, 30-day
(or one-month) yields and effective yields may also be calculated.

For the seven-day period ended September 30, 1995, the yield
and the compounded effective yield on TempFund shares were 5.75% and 5.92%,
respectively. For the same period, the yield and the compounded effective
yield on TempFund Dollar Shares were 5.50% and 5.67%, respectively. For the
30-day period ended September 30, 1995, the yield and the compounded effective
yield on TempFund Shares were 5.74% and 5.89%, respectively. Similarly, for
the same 30-day period, the yield and the compounded effective yield on
TempFund Dollar Shares were 5.49% and 5.63%, respectively. With respect to
TempCash Shares, for the seven-day period ended September 30, 1995, the yield
and the compounded effective yield were 5.74% and 5.90%, respectively. For the
same period, the yield and the compounded effective yield on TempCash Dollar
Shares were 5.49% and 5.65%, respectively. For the 30-day period ended
September 30, 1995, the yield and the compounded effective yield on TempCash
Shares were 5.71% and 5.86%, respectively. Similarly, for the same 30-day
period, the yield and the compounded effective yield on TempCash Dollar Shares
were 5.46% and 5.60%, respectively.

From time to time, in reports to shareholders or otherwise, a
Fund's yield may be quoted and compared to that of other money market funds or
accounts with similar investment objectives and to stock or other relevant
indices. For example, the yield of the Fund may be compared to the
IBC/Donoghue's Money

-28-
<PAGE> 77

Fund Average, which is an average compiled by IBC/Donoghue's MONEY FUND
REPORT(R) of Holliston, MA 01746, a widely recognized independent publication
that monitors the performance of money market funds, or to the average yields
reported by the Bank Rate Monitor from money market deposit accounts offered by
the 50 leading banks and thrift institutions in the top five standard
metropolitan statistical areas.

YIELD WILL FLUCTUATE, AND ANY QUOTATION OF YIELD SHOULD NOT BE
CONSIDERED AS REPRESENTATIVE OF THE FUTURE PERFORMANCE OF THE FUND. Since
yields fluctuate, yield data cannot necessarily be used to compare an
investment in a Fund's shares with bank deposits, savings accounts, and similar
investment alternatives which often provide an agreed or guaranteed fixed yield
for a stated period of time. Shareholders should remember that performance and
yield are generally functions of the kind and quality of the investments held
in a fund, portfolio maturity, operating expenses and market conditions. Any
fees charged by banks with respect to customer accounts in investing in shares
of a Fund will not be included in yield calculations; such fees, if charged,
would reduce the actual yield from that quoted.

The Funds may also from time to time include in advertisements, sales
literature, communications to shareholders and other materials ("Materials"),
discussions or illustrations of the effects of compounding. "Compounding"
refers to the fact that, if dividends or other distributions on an investment
are reinvested by being paid in additional Portfolio shares, any future income
or capital appreciation of a Fund would increase the value, not only of the
original investment, but also of the additional shares received through
reinvestment. As a result, the value of the Fund investment would increase
more quickly than if dividends or other distributions had been paid in cash.

In addition, the Funds may also include in Materials discussions
and/or illustrations of the potential investment goals of a prospective
investor, investment management strategies, techniques, policies or investment
suitability of a Fund, economic conditions, the relationship between sectors of
the economy and the economy as a whole, various securities markets, the effects
of inflation and historical performance of various asset classes, including but
not limited to, stocks, bonds and Treasury securities. From time to time,
Materials may summarize the substance of information contained in shareholder
reports (including the investment composition of a Fund), as well as the views
of the advisers as to current market, economic, trade and interest rate trends,
legislative, regulatory and monetary developments, investment strategies and
related matters believed to be of relevance to a Fund. The Funds may also
include in Materials charts, graphs or drawings which compare the investment

-29-
<PAGE> 78

objective, return potential, relative stability and/or growth possibilities of
the Funds and/or other mutual funds, or illustrate the potential risks and
rewards of investment in various investment vehicles, including but not limited
to, stocks, bonds, Treasury securities and shares of a Fund and/or other mutual
funds. Materials may include a discussion of certain attributes or benefits to
be derived by an investment in a Fund and/or other mutual funds (such as value
investing, market timing, dollar cost averaging, asset allocation, constant
ratio transfer, automatic accounting rebalancing and the advantages and
disadvantages of investing in tax-deferred and taxable investments),
shareholder profiles and hypothetical investor scenarios, timely information on
financial management, tax and retirement planning and investment alternatives
to certificates of deposit and other financial instruments. Such Materials may
include symbols, headlines or other material which highlight or summarize the
information discussed in more detail therein.

ADDITIONAL DESCRIPTION CONCERNING SHARES

The Company does not presently intend to hold annual meetings
of shareholders except as required by the 1940 Act or other applicable law.
Upon the written request of shareholders owning at least twenty percent of the
Company's shares, the Company will call for a meeting of shareholders to
consider the removal of one or more directors and other certain matters. To
the extent required by law, the Company will assist in shareholder
communication in such matters.

The Company's Charter authorizes the Board of Directors,
without shareholder approval (unless otherwise required by applicable law), to:
(i) sell and convey a Fund's assets to another management investment company
for consideration which may include securities issued by the purchaser and, in
connection therewith, to cause all outstanding shares of a Fund to be redeemed
at a price which is equal to their net asset value and which may be paid in
cash or by distribution of the securities or other consideration received from
the sale and conveyance; (ii) sell and convert a Fund's assets into money and,
in connection therewith, to cause all outstanding shares of a Fund to be
redeemed at their net asset value; or, (iii) combine a Fund's assets with the
assets belonging to another portfolio of the Company if the Board of Directors
reasonably determines that such combination will not have a material adverse
effect on the shareholders of such Fund and such other portfolio and, in
connection therewith, to cause all outstanding shares of a Fund to be redeemed
or converted into shares of another class of the Company's Common Stock at net
asset value. The exercise of such authority by the Board will be subject to
the provisions of the 1940 Act.

-30-
<PAGE> 79

As stated in the Funds' Prospectuses, holders of shares in a
Fund in the Company will vote in the aggregate and not by class or sub-class on
all matters, except as described above, and except that only a Fund's Dollar
Shares will be entitled to vote on matters submitted to a vote of shareholders
pertaining to that Fund's arrangements with Service Organizations. (See
"Management of the Funds -- Service Organizations.") Further, shareholders of
each of the Company's portfolios will vote in the aggregate and not by
portfolio except as otherwise required by law or when the Board of Directors
determines that the matter to be voted upon affects only the interests of the
shareholders of a particular portfolio. Rule 18f-2 under the 1940 Act provides
that any matter required to be submitted by the provisions of such Act or
applicable state law, or otherwise, to the holders of the outstanding
securities of an investment company such as the Company shall not be deemed to
have been effectively acted upon unless approved by the holders of a majority
of the outstanding shares of each portfolio affected by the matter. Rule 18f-2
further provides that a portfolio shall be deemed to be affected by a matter
unless it is clear that the interests of each portfolio in the matter are
identical or that the matter does not affect any interest of the portfolio.
Under the Rule, the approval of an investment advisory agreement or any change
in a fundamental investment policy would be effectively acted upon with respect
to a portfolio only if approved by the holders of a majority of the outstanding
voting securities of such portfolio. However, the Rule also provides that the
ratification of the selection of independent accountants, the approval of
principal underwriting contracts, and the election of directors are not subject
to the separate voting requirements and may be effectively acted upon by
shareholders of the investment company voting without regard to portfolio.

Notwithstanding any provision of Maryland law requiring a
greater vote of shares of the Company's Common Stock (or of any class voting as
a class) in connection with any corporate action, unless otherwise provided by
law (for example by Rule 18f-2 discussed above) or by the Company's Charter,
the Company may take or authorize such action upon the favorable vote of the
holders of more than 50% of all of the outstanding shares of Common Stock
voting without regard to class (or portfolio).

COUNSEL

Drinker Biddle & Reath, Philadelphia National Bank Building,
1345 Chestnut Street, Philadelphia, Pennsylvania 19107-3496, of which W. Bruce
McConnel, III, Secretary of the Company, is a partner, will pass upon the
legality of the shares offered hereby.

-31-
<PAGE> 80

AUDITORS

The financial statements of the Company which appear in this
Statement of Additional Information and the financial highlights which appear
in the Funds' Prospectuses for the fiscal years ended September 30, 1995, 1994,
1993, 1992 and 1991 have been audited by Coopers & Lybrand L.L.P., independent
accountants, whose report thereon appears elsewhere herein, and have been
included herein and in the Funds' Prospectuses in reliance upon the report of
said firm as independent accountants. Coopers & Lybrand L.L.P. has offices at
2400 Eleven Penn Center, Philadelphia, Pennsylvania 19103.

MISCELLANEOUS

SHAREHOLDER VOTE

As used in this Statement of Additional Information and the
Funds' Prospectuses, a "majority of the outstanding shares" of a Fund or of a
particular portfolio means, with respect to the approval of an investment
advisory agreement, a distribution plan or a change in a fundamental investment
policy, the lesser of (1) 67% of that Fund's shares (irrespective of class or
subclass) or of the portfolio represented at a meeting at which the holders of
more than 50% of the outstanding shares of that Fund or portfolio are present
in person or by proxy, or (2) more than 50% of the outstanding shares of a Fund
(irrespective of class or subclass) or of the portfolio.

SECURITIES HOLDINGS OF BROKERS

As of September 30, 1995, TempFund held the following debt
securities: Goldman Sachs Group $295,000,000, Merrill Lynch $286,491,000 and
Morgan Stanley Group $1,093,733,000. As of September 30, 1995, TempCash held
the following debt securities: Goldman Sachs Group $174,998,000, Merrill Lynch
$100,000,000, Shearson Lehman Brothers $125,000,000 and Paine Webber, Inc.
$26,100,000. Each of the above entities is or may be associated with the
Funds' regular broker-dealers.

CERTAIN RECORD HOLDERS

On December 31, 1995, the name, address and percentage of
ownership of each institutional investor that owned of record 5% or more of the
outstanding shares of the TempFund portfolio were as follows:

-32-
<PAGE> 81

First Interstate Bank/California, 26610 West Agoura Road, Calabasas, CA 91302,
9.47%; Sanwa Bank/California, P.O. Box 60078, Los Angeles, CA 90060, 7.91%.

On December 31, 1995, the name, address and percentage of
ownership of the institutional investors that owned of record 5% or more of the
outstanding shares of the TempCash portfolio were as follows: Harris Trust &
Savings Bank, 200 W. Monroe, 12th Floor, Chicago, IL 60690, 11.03%; Bankers
Trust Co., 130 Liberty Street, 35th Floor, New York, NY 10006, 13.42%; BHC
Securities, Inc., One Commerce Square, 11th Floor, Philadelphia, PA 19103,
8.86%.

-33-
<PAGE> 82

TEMPFUND PORTFOLIO
Temporary Investment Fund, Inc.
Statement of Net Assets

September 30, 1995
<TABLE>
<CAPTION>
MATURITY PAR
DATE (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
CERTIFICATES OF DEPOSIT--0.5%
DOMESTIC CERTIFICATES OF DEPOSIT
National City Bank of Cleveland
6.375%............ 05/10/96 $ 25,000 $ 25,064,970
--------------
Total Certificates of Deposit
(Cost $25,064,970).................. 25,064,970
--------------
COMMERCIAL PAPER--43.5%
BANKS--4.6%
Citicorp
6.625%............ 10/02/95 100,000 99,981,597
Morgan (J. P.) & Co.
5.59%............. 12/20/95 25,000 24,689,444
National City Corp.
6.05%............. 10/31/95 25,000 24,873,958
Norwest Corp.
5.66%............. 11/13/95 60,000 59,594,367
5.66%............. 11/15/95 40,000 39,717,000
--------------
248,856,366
--------------
CHEMICALS & ALLIED PRODUCTS--1.3%
Monsanto Co.
5.60%............. 12/01/95 20,547 20,352,032
The Bayer Corp.
5.67%............. 11/09/95 50,000 49,692,875
--------------
70,044,907
--------------
CONVERTED PAPER & PAPERBOARD PRODUCTS--0.9%
Minnesota Mining & Manufacturing Co.
6.50%............. 10/02/95 48,565 48,556,231
--------------
FINANCE LESSORS--4.2%
General Electric Capital Corp.
5.70%............. 10/24/95 60,000 59,781,500
5.75%............. 11/28/95 75,000 74,305,208
5.68%............. 02/14/96 75,000 73,390,667
Pitney Bowes Credit Corp.
5.625%............ 12/01/95 22,037 21,826,960
--------------
229,304,335
--------------
INDUSTRIAL INORGANIC CHEMICALS--0.3%
Air Products & Chemicals, Inc.
5.62%............. 12/14/95 17,000 16,803,612
--------------
INSURANCE AGENTS, BROKERS & SERVICES--0.5%
Marsh and McLennan Companies
5.75%............. 11/30/95 30,000 29,712,500
--------------
LIFE INSURANCE--0.5%
Prudential Funding Corp.
5.72%............. 11/15/95 25,000 24,821,250
--------------
MOTOR VEHICLES & CAR BODIES--0.3%
Daimler-Benz North America Corp.
6.04%............. 11/27/95 15,000 14,856,550
--------------

COMMERCIAL PAPER (CONTINUED)
PERSONAL CREDIT INSTITUTIONS--9.9%
Associates Corp. of North America
5.65%............. 10/02/95 50,000 49,992,153
5.68%............. 10/27/95 100,000 99,589,778
5.66%............. 12/05/95 50,000 49,489,028
5.66%............. 12/06/95 50,000 49,481,167
Ford Motor Credit Corp.
5.65%............. 10/06/95 150,000 149,882,292
5.87%............. 11/08/95 80,195 79,698,103
5.76%............. 02/20/96 60,000 58,636,800
--------------
536,769,321
--------------
PETROLEUM REFINING--1.3%
Koch Industries, Inc.
6.52%............. 10/02/95 75,000 74,986,417
--------------
PLASTIC SYNTHETIC RESIN/RUBBER--1.8%
Du Pont (E.I.) de Nemours & Co.
6.04%............. 10/03/95 50,000 49,983,222
5.55%............. 07/18/96 50,000 47,756,875
--------------
97,740,097
--------------
RAILROAD LINE-HAUL OPERATING--0.3%
Norfolk Southern Corp.
5.66%............. 11/08/95 15,000 14,910,383
--------------
SECURITY BROKERS & DEALERS--8.4%
C.S. First Boston
5.72%............. 12/13/95 40,000 39,536,044
Goldman Sachs Group L.P.
6.75%............. 10/02/95 85,000 84,984,063
Merrill Lynch & Co.
5.57%............. 01/16/96 50,000 49,172,236
5.57%............. 03/07/96 90,000 87,799,850
Morgan Stanley Group, Inc.
5.65%............. 01/22/96 100,000 98,226,528
Smith Barney Inc.
5.65%............. 12/18/95 100,000 98,775,833
--------------
458,494,554
--------------
SHORT-TERM BUSINESS CREDIT INSTITUTIONS--5.4%
American Express Credit Corp.
5.67%............. 10/04/95 75,000 74,964,563
5.68%............. 10/30/95 70,000 69,679,711
5.64%............. 12/12/95 50,000 49,436,000
5.64%............. 12/19/95 100,000 98,762,333
--------------
292,842,607
--------------
SOAP, DETERGENT, CLEANING PREPS, PERFUMES
& COSMETICS--0.5%
Colgate-Palmolive Company
5.65%............. 10/10/95 25,000 24,964,688
--------------
</TABLE>

See accompanying notes to financial statements.

<PAGE> 83

TEMPFUND PORTFOLIO
Statement of Net Assets (Continued)
<TABLE>
<CAPTION>
MATURITY PAR
DATE (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
COMMERCIAL PAPER (CONTINUED)
TELEPHONE COMMUNICATIONS--3.3%
American Telephone & Telegraph Co.
5.67%............. 11/10/95 $100,000 $ 99,370,000
5.72%............. 11/17/95 25,000 24,813,306
5.71%............. 11/22/95 45,000 44,628,850
Ameritech Corp.
5.40%............. 04/04/96 10,000 9,721,000
--------------
178,533,156
--------------
Total Commercial Paper
(Cost $2,362,196,974)............... 2,362,196,974
--------------
UNITED STATES GOVERNMENT AGENCY
OBLIGATIONS--6.6%
Federal Home Loan Bank
6.07%.+........... 10/02/95 70,000 69,997,154
5.695%............ 06/26/96 42,935 42,918,275
Federal National Mortgage Association
5.50%.+........... 10/03/95 100,000 100,000,000
5.8125%........... 09/27/96 75,000 75,000,000
5.86%............. 10/07/96 70,000 69,930,000
--------------
Total U.S.Government Agency
Obligations
(Cost $357,845,429)................. 357,845,429
--------------
VARIABLE RATE OBLIGATIONS+--19.2%
BANKS--9.2%
First Union National Bank of North Carolina
6.56%............. 10/02/95 100,000 100,000,000
Morgan Guaranty Trust
6.07%............. 10/02/95 275,000 274,859,006
Norwest Corp.
5.875%............ 10/04/95 100,000 100,000,000
5.8625%........... 12/20/95 25,000 25,027,115
--------------
499,886,121
--------------
FINANCE LESSORS--0.9%
General Electric Capital Corp.
5.8125%........... 12/14/95 50,000 50,000,000
--------------
PERSONAL CREDIT INSTITUTIONS--1.1%
Ford Motor Credit Corp.
6.125%............ 10/19/95 60,200 60,325,738
--------------
SECURITY BROKERS & DEALERS--8.0%
Bear Stearns Companies, Inc.
6.75%............. 10/02/95 100,000 100,000,000
5.47%............. 10/03/95 75,000 75,000,000
5.9875%........... 11/16/95 100,000 100,000,000
Goldman Sachs Group, L.P.
6.1875%........... 10/06/95 160,000 160,000,000
--------------
435,000,000
--------------
Total Variable Rate Obligations
(Cost $1,045,211,859)............... 1,045,211,859
--------------
MEDIUM TERM NOTES--6.1%
FINANCE LESSORS--2.4%
General Electric Capital Corp.
14.00%............ 07/01/96 20,000 21,135,673
14.00%............ 07/05/96 17,500 18,509,362
IBM Credit Corp.
15.00%............ 01/11/96 40,000 40,945,653
5.66%............. 07/17/96 50,000 50,000,000
--------------
130,590,688
--------------
SECURITY BROKERS & DEALERS--3.7%
Goldman Sachs Group, L. P.
5.875%............ 04/15/96 50,000 50,000,000
Merrill Lynch & Co.
7.214%............ 12/18/95 50,000 50,000,000
7.56%............. 01/18/96 49,500 49,496,784
5.742%............ 07/19/96 50,000 50,000,000
--------------
199,496,784
--------------
Total Medium Term Notes
(Cost $330,087,472)................. 330,087,472
--------------
REPURCHASE AGREEMENTS--27.4%
J. P. Morgan Securities
6.25%............. 10/02/95 $125,000 $ 125,000,000
(Agreement dated 09/29/95 to
be repurchased at
$125,021,701
collateralized by
$114,608,000 U.S. Treasury
Notes 7.50% due 11/15/16.
Market value of collateral
is $127,566,504.)
6.30%............. 10/02/95 98,000 98,000,000
(Agreement dated 09/29/95 to
be repurchased at
$98,017,150 collateralized
by $88,756,000 U.S.
Treasury Bonds 7.625% due
02/15/25. Market value of
collateral is
$100,017,333.)
Lehman Government Securities, Inc.
6.50%............. 10/02/95 85,000 85,000,000
(Agreement dated 09/29/95 to
be repurchased at
$85,015,347 collateralized
by $83,284,000 U.S.
Treasury Notes 6.75% due
5/31/99 to 6/30/99. Market
value of collateral is
$86,671,963.)
</TABLE>

See accompanying notes to financial statements.

<PAGE> 84

TEMPFUND PORTFOLIO
Statement of Net Assets (Concluded)
<TABLE>
<CAPTION>
MATURITY PAR
DATE (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Morgan Stanley & Co.
6.46%............. 10/02/95 $304,000 $ 304,000,000
(Agreement dated 09/29/95 to
be repurchased at
$304,054,551
collateralized by
$293,685,000 U.S. Treasury
Notes and Bonds 5.125% to
14.00% due 11/01/95 to
11/15/22. Market value of
collateral is
$312,168,195.)
6.54%............. 10/02/95 405,000 405,000,000
(Agreement dated 09/29/95 to
be repurchased at
$405,073,575
collateralized by
$430,310,035 Federal Home
Loan Bank Notes 3.94% to
9.25% due 10/02/95 to
11/01/24. Market value of
collateral is
$415,881,969.)
PaineWebber, Inc.
6.55%............. 10/02/95 275,000 275,000,000
(Agreement dated 09/29/95 to
be repurchased at
$275,050,035
collateralized by
$306,478,442 Federal
National Mortgage
Association Notes and
$59,320,000 Student Loan
Marketing Association
Notes 4.875% to 9.375% due
11/01/95 to 01/15/30.
Market value of collateral
is $283,250,688.)
6.625%............ 10/02/95 200,000 200,000,000
(Agreement dated
09/29/95 to be repurchased
at $200,036,806
collateralized by
$217,336,745
Federal National Mortgage
Association Adjustable
Rate Notes 5.00% to 11.50%
due 09/01/00 to 10/01/25.
Market value of collateral
is $206,001,738.)
--------------
Total Repurchase Agreements
(Cost $1,492,000,000)............... 1,492,000,000
--------------

<CAPTION>
VALUE
--------------
<S> <C> <C>
TOTAL INVESTMENT IN SECURITIES
(Cost $5,612,406,704*)........ 103.3% $5,612,406,704
LIABILITIES IN EXCESS OF OTHER
ASSETS........................ (3.3) (179,232,597)
------ --------------
NET ASSETS (Equivalent to $1.00
per share based on
5,351,412,693 TempFund shares
and 81,806,843 TempFund Dollar
shares, $.001 par value common
stock outstanding)............ 100.0% $5,433,174,107
====== ==============

NET ASSET VALUE, offering and
redemption price per share
($5,433,174,107 / 5,433,219,536)........ $1.00
=====
</TABLE>

- ---------------
* Cost for federal income tax purposes.
+ Variable Rate Obligations--The rate shown is the rate as of September 30,
1995, and the maturity date shown is the date the principal amount can be
recovered upon demand or put.

TEMPFUND/TEMPFUND DOLLAR
Maturity Information
September 30, 1995

<TABLE>
<CAPTION>
PERCENTAGE
MATURITY PAR OF
PERIOD (000) PORTFOLIO
------------- ---------- ----------
<S> <C> <C>
1- 7 Days $3,105,565 55.2%
8- 14 Days 25,000 0.4
15- 30 Days 290,200 5.2
31- 60 Days 655,195 11.6
61- 90 Days 629,584 11.2
91-120 Days 239,500 4.2
121-150 Days 135,000 2.4
Over 150 Days 550,435 9.8
---------- -------
$5,630,479 100.0%
========== =======
Average Weighted Maturity--51 Days
- -------------------------------------------------------
</TABLE>

See accompanying notes to financial statements.

<PAGE> 85

TEMPCASH PORTFOLIO
Temporary Investment Fund, Inc.
Statement of Net Assets

September 30, 1995
<TABLE>
<CAPTION>
MATURITY PAR
DATE (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
CERTIFICATES OF DEPOSIT--7.9%
YANKEE CERTIFICATES OF DEPOSIT
ABN-AMRO Bank N.A. Finance, Inc.
5.57%............ 06/05/96 $ 25,000 $ 24,958,678
Banque Nationale de Paris
6.63%............ 03/26/96 25,000 25,026,203
Banque Paribas
6.27%............ 11/01/95 25,000 25,000,122
Commerzbank
6.18%............ 05/09/96 15,000 15,028,708
6.03%............ 05/10/96 15,000 15,015,911
Westdeutsche Landesbank Girozentrale
6.71%............ 03/04/96 35,000 35,036,468
--------------
Total Certificates of Deposit
(Cost $140,066,090)................. 140,066,090
--------------
COMMERCIAL PAPER--21.6%
BANKS--5.9%
National City Corp.
6.05%............ 10/31/95 25,000 24,873,958
Nationwide Building Society
5.71%............ 11/02/95 50,000 49,746,222
5.68%............ 12/08/95 30,000 29,678,133
--------------
104,298,313
--------------
CONGLOMERATES--2.0%
BTR Dunlop Finance, Inc.
5.73%............ 11/16/95 36,000 35,736,420
--------------
HOUSEHOLD APPLIANCES--1.6%
Whirlpool Finance Corp.
6.05%............ 11/01/95 20,000 19,895,806
5.86%............ 01/26/96 8,500 8,338,118
--------------
28,233,924
--------------
INSURANCE AGENTS AND BROKERS SERVICES--1.4%
Marsh and McLennan Companies
5.70%............ 02/22/96 25,000 24,430,000
--------------
PERSONAL CREDIT INSTITUTIONS--4.8%
BMW U.S. Capital Corp.
5.72%............ 10/24/95 40,910 40,760,497
5.67%............ 12/15/95 14,155 13,987,794
General Motors Acceptance Corp.
5.68%............ 11/29/95 30,000 29,720,733
--------------
84,469,024
--------------
PHARMACEUTICAL PREPARATIONS--3.1%
American Home Products Corp.
5.74%............ 11/09/95 29,100 28,919,047
5.70%............ 12/06/95 26,825 26,544,679
--------------
55,463,726
--------------

COMMERCIAL PAPER (CONTINUED)
PLASTIC, SYNTHETIC RESIN/RUBBER--2.8%
Du Pont (E.I.) de Nemours & Co.
6.04%............ 10/03/95 50,000 49,983,222
--------------
Total Commercial Paper
(Cost $382,614,629)................. 382,614,629
--------------
TIME DEPOSITS--2.8%
Chemical Bank
6.50%............ 10/02/95 50,000 50,000,000
--------------
Total Time Deposits
(Cost $50,000,000).................. 50,000,000
--------------
UNITED STATES GOVERNMENT AGENCY
OBLIGATIONS--23.8%
Federal Farm Credit Bank
5.78%+........... 10/04/95 50,000 49,967,065
Federal National Mortgage Association
5.50%+........... 10/03/95 75,000 75,000,000
5.8125%.......... 09/27/96 45,000 44,986,648
5.86%............ 10/07/96 25,000 24,975,000
Student Loan Marketing Association
5.44%+........... 10/03/95 51,750 51,745,210
5.47%+........... 10/03/95 50,000 50,008,977
5.48%+........... 10/03/95 6,000 6,001,541
5.50%+........... 10/03/95 44,000 43,992,045
5.51%+........... 10/03/95 5,300 5,302,971
5.64%+........... 10/03/95 13,950 14,005,002
5.715%+.......... 10/03/95 56,000 56,174,002
--------------
Total U.S. Government Agency
Obligations
(Cost $422,158,461)................. 422,158,461
--------------
VARIABLE RATE OBLIGATIONS--40.7%
BANKS--5.7%
First Union National Bank of North Carolina
6.56%............ 10/02/95 100,000 100,000,000
--------------
FINANCE SERVICES--2.8%
AT&T Capital Corp.
6.30%............ 10/02/95 50,000 50,020,184
--------------
INSURANCE--2.8%
Peoples Security Life Funding Agreement
6.07%............ 10/02/95 50,000 50,000,000
--------------
PERSONAL CREDIT INSTITUTIONS--2.6%
Ford Motor Credit
6.075%........... 10/16/95 20,000 20,045,629
General Motors Acceptance Corp.
5.9625%.......... 10/23/95 25,000 25,024,047
--------------
45,069,676
--------------
</TABLE>

See accompanying notes to financial statements.

<PAGE> 86

TEMPCASH PORTFOLIO
Statement of Net Assets (Concluded)

<TABLE>
<CAPTION>
MATURITY PAR
DATE (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
VARIABLE RATE OBLIGATIONS (CONTINUED)
SECURITY BROKERS & DEALERS--26.8%
Bear Stearns Companies, Inc.
6.70%............ 10/02/95 $ 25,000 $ 25,000,000
6.75%............ 10/02/95 60,000 60,000,000
5.47%............ 10/03/95 40,000 40,000,000
Goldman Sachs Group L.P.
6.00%............ 11/10/95 100,000 100,000,000
Lehman Brothers Holdings, Inc.
5.975%........... 10/06/95 125,000 125,000,000
Merrill Lynch & Co.
6.20%............ 10/02/95 25,000 24,998,505
6.68%............ 10/02/95 50,000 49,999,932
5.47%............ 10/03/95 50,000 50,000,000
--------------
474,998,437
--------------
Total Variable Rate Obligations
(Cost $720,088,297)................. 720,088,297
--------------
MEDIUM TERM NOTES--2.8%
SECURITY BROKERS & DEALERS
Merrill Lynch & Co.
6.52%............ 05/13/96 50,000 50,000,000
--------------
Total Medium Term Notes
(Cost $50,000,000).................. 50,000,000
--------------
REPURCHASE AGREEMENTS--1.5%
PaineWebber, Inc.
6.55%............ 10/02/95 26,100 26,100,000
(Agreement dated 09/29/95
to be repurchased at
$26,104,749,
collateralized by
$19,279,190
Federal National
Mortgage Association
Notes and $15,129,000
Federal Home Loan
Mortgage Corp. Notes
6.00% to 8.50% due
08/25/07 to 02/25/25.
Market value of
collateral is
$26,886,470.)
--------------
Total Repurchase Agreements
(Cost $26,100,000).................. 26,100,000
--------------
</TABLE>

<TABLE>
<CAPTION>
VALUE
--------------
<S> <C> <C>
TOTAL INVESTMENT IN SECURITIES
(Cost $1,791,027,477*)....... 101.1% $1,791,027,477
LIABILITIES IN EXCESS OF OTHER
ASSETS....................... (1.1) (20,705,253)
----- --------------
NET ASSETS (Equivalent to $1.00
per share based on
1,316,583,230 TempCash shares
and 454,257,442 TempCash
Dollar shares, $.001 par
value common stock
outstanding)................. 100.0% $1,770,322,224
===== ==============
NET ASSET VALUE, offering and redemption
price per share ($1,770,322,224 /
1,770,840,672).......................... $1.00
=====
</TABLE>

- ---------------
* Cost for federal income tax purposes.
+ Variable Rate Obligations--The rate shown is the rate as of September 30,1995
and the maturity date shown is the date the principal amount can be recovered
upon demand or put.
- -------------------------------------------------------
TEMPCASH/TEMPCASH DOLLAR
Maturity Information
September 30, 1995

<TABLE>
<CAPTION>
PERCENTAGE
MATURITY PAR OF
PERIOD (000) PORTFOLIO
------------- ---------- ----------
<S> <C> <C>
1- 7 Days $1,053,100 58.7%
8- 14 Days 0 0.0
15- 30 Days 85,910 4.8
31- 60 Days 315,100 17.6
61- 90 Days 70,980 4.0
91-120 Days 8,500 0.5
121-150 Days 25,000 1.4
Over 150 Days 235,000 13.0
---------- -------
$1,793,590 100.0%
========== =======
Average Weighted Maturity--48 Days
- -------------------------------------------------------
</TABLE>

See accompanying notes to financial statements.

<PAGE> 87

TEMPORARY INVESTMENT FUND, INC.
Statements of Operations
Year Ended September 30, 1995

<TABLE>
<CAPTION>
TEMPFUND TEMPCASH
PORTFOLIO PORTFOLIO
------------ ------------
<S> <C> <C>
Interest income............................................................... $322,944,326 $226,905,534
------------ ------------
Expenses:
Investment advisory fee................................................... 6,840,438 5,277,478
Administration fee........................................................ 6,840,438 5,277,478
Directors' fees and officer's salary...................................... 48,334 42,296
Transfer agent fee........................................................ 306,262 157,782
Custodian fee............................................................. 564,897 432,806
Shareholder computer access program....................................... 87,867 37,420
Legal and audit........................................................... 78,270 74,668
Registration fees and expenses............................................ 23,205 14,400
Other..................................................................... 114,479 71,689
------------ ------------
14,904,190 11,386,017
Less fees waived.......................................................... (1,884,683) (5,190,756)
------------ ------------
13,019,507 6,195,261
Service Organization fees................................................. 197,029 1,102,689
------------ ------------
Total expenses....................................................... 13,216,536 7,297,950
------------ ------------
Net investment income..................................................... 309,727,790 219,607,584
Net realized gain (loss) on investments....................................... (45,427) 13,766
------------ ------------
Net increase in net assets resulting from operations...................... $309,682,363 $219,621,350
============ ============
</TABLE>

See accompanying notes to financial statements.

<PAGE> 88

TEMPORARY INVESTMENT FUND, INC.
Statements of Changes in Net Assets

<TABLE>
<CAPTION>
TEMPFUND PORTFOLIO TEMPCASH PORTFOLIO
------------------------------------- ------------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
1995 1994 1995 1994
---------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income......... $ 309,727,790 $ 226,506,870 $ 219,607,584 $ 89,031,431
Net realized gain (loss)
on investments.............. (45,427) 38,515 13,766 (532,216)
---------------- ----------------- ---------------- ----------------
Net increase in net assets
resulting from
operations................ 309,682,363 226,545,385 219,621,350 88,499,215
---------------- ----------------- ---------------- ----------------
Distributions to shareholders:
Dividends to shareholders
from net investment income:
TempFund shares............. (305,489,546) (223,175,770) -- --
TempFund Dollar shares...... (4,238,244) (3,331,100) -- --
TempCash shares............. -- -- (195,367,688) (76,657,316)
TempCash Dollar shares...... -- -- (24,239,896) (12,374,115)
Distributions to shareholders
from net realized gain:
TempFund shares............. (37,842) (156,828) -- --
TempFund Dollar shares...... (673) (2,408) -- --
TempCash shares............. -- -- -- (40,922)
TempCash Dollar shares...... -- -- -- (6,452)
---------------- ----------------- ---------------- ----------------
Total distributions to
shareholders............ (309,766,305) (226,666,106) (219,607,584) (89,078,805)
---------------- ----------------- ---------------- ----------------
Capital share transactions
(at $1 per share):
Sale of shares................ 86,630,484,234 111,597,973,227 73,114,313,267 40,239,880,232
Shares issued in reinvestment
of dividends................ 47,211,646 35,304,942 69,643,235 21,324,036
Shares repurchased............ (85,827,394,675) (112,684,951,660) (74,142,052,727) (39,318,494,571)
---------------- ----------------- ---------------- ----------------
Increase (decrease) in
net assets derived from
capital share
transactions............ 850,301,205 (1,051,673,491) (958,096,225) 942,709,697
---------------- ----------------- ---------------- ----------------
Total increase (decrease)
in net assets........... 850,217,263 (1,051,794,212) (958,082,459) 942,130,107
Net assets:
Beginning of year................. 4,582,956,844 5,634,751,056 2,728,404,683 1,786,274,576
---------------- ----------------- ---------------- ----------------
End of year....................... $ 5,433,174,107 $ 4,582,956,844 $ 1,770,322,224 $ 2,728,404,683
================ ================= ================ ================
</TABLE>

See accompanying notes to financial statements.

<PAGE> 89

TEMPORARY INVESTMENT FUND, INC.
Financial Highlights
(For a Share of the Fund Outstanding Throughout Each Year)

<TABLE>
<CAPTION>
TEMPFUND SHARES
------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
------------------------------------------------------------------
1995 1994 1993 1992 1991
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income................................. .0567 .0360 .0310 .0424 .0667
Net Realized Gains on Investments..................... -- -- -- .0015 --
------ ------ ------ ------ ------
Total From Investment Operations...................... .0567 .0360 .0310 .0439 .0667
------ ------ ------ ------ ------
Less Distributions
Dividends (from net investment income)................ (.0567) (.0360) (.0310) (.0424) (.0667)
Distributions (from capital gains).................... -- -- -- (.0015) --
------ ------ ------ ------ ------
Total Distributions................................... (.0567) (.0360) (.0310) (.0439) (.0667)
------ ------ ------ ------ ------
Net Asset Value, End of Year............................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ======
Total Return.......................................... 5.82% 3.66% 3.14% 4.48% 6.87%
Ratios/Supplemental Data
Net Assets, End of Year (000)....................... $5,351,346 $4,480,851 $5,522,056 $9,227,572 $8,888,832
Ratio of Expenses to Average Daily Net Assets....... .24%(1) .25%(1) .21% .21% .27%
Ratio of Net Investment Income to Average Daily
Net Assets........................................ 5.67% 3.60% 3.10% 4.13% 6.53%
</TABLE>

<TABLE>
<CAPTION>
TEMPFUND DOLLAR SHARES
------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
------------------------------------------------------------------
1995 1994 1993 1992 1991
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income................................. .0542 .0335 .0285 .0399 .0642
Net Realized Gains on Investments..................... -- -- -- .0015 --
------ ------ ------ ------ ------
Total From Investment Operations...................... .0542 .0335 .0285 .0414 .0642
------ ------ ------ ------ ------
Less Distributions
Dividends (from net investment income)................ (.0542) (.0335) (.0285) (.0399) (.0642)
Distributions (from capital gains).................... -- -- -- (.0015) --
------ ------ ------ ------ ------
Total Distributions................................... (.0542) (.0335) (.0285) (.0414) (.0642)
------ ------ ------ ------ ------
Net Asset Value, End of Year............................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ======
Total Return.......................................... 5.57% 3.41% 2.89% 4.23% 6.62%
Ratios/Supplemental Data
Net Assets, End of Year (000)....................... $ 81,828 $ 102,105 $ 112,695 $ 217,230 $ 44,667
Ratio of Expenses to Average Daily Net Assets....... .49%(1) .50%(1) .46% .46% .52%
Ratio of Net Investment Income to Average Daily
Net Assets........................................ 5.42% 3.35% 2.85% 3.88% 6.28%

- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of expenses
to average daily net assets for TempFund Shares would have been .27% for the
years ended September 30, 1995 and 1994, respectively. For TempFund Dollar
Shares the ratio of expenses to average daily net assets would have been .52%
for the years ended September 30, 1995 and 1994, respectively.

See accompanying notes to financial statements.
</TABLE>

<PAGE> 90

TEMPORARY INVESTMENT FUND, INC.
Financial Highlights
(For a Share of the Fund Outstanding Throughout Each Year)

<TABLE>
<CAPTION>
TEMPCASH SHARES
----------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
----------------------------------------------------------------------
1995 1994 1993 1992 1991
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income.............................. .0575 .0370 .0310 .0424 .0676
Net Realized Gains on Investments.................. -- -- -- .0008 --
------ ------ ------ ------ ------
Total From Investment Operations................... .0575 .0370 .0310 .0432 .0676
------ ------ ------ ------ ------
Less Distributions
Dividends (from net investment income)............. (.0575) (.0370) (.0310) (.0424) (.0676)
Distributions (from capital gains)................. -- -- -- (.0008) --
------ ------ ------ ------ ------
Total Distributions................................ (.0575) (.0370) (.0310) (.0432) (.0676)
------ ------ ------ ------ ------
Net Asset Value, End of Year......................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ======
Total Return....................................... 5.90% 3.76% 3.14% 4.41% 6.97%
Ratios/Supplemental Data
Net Assets, End of Year (000).................... $1,316,166 $2,330,456 $1,479,035 $1,492,959 $1,528,637
Ratio of Expenses to Average Daily Net Assets.... .16%(1) .16%(1) .19%(1) .20%(1) .20%(1)
Ratio of Net Investment Income to Average Daily
Net Assets..................................... 5.75% 3.70% 3.10% 4.14% 6.57%
</TABLE>

<TABLE>
<CAPTION>
TEMPCASH DOLLAR SHARES
----------------------------------------------------------------------
YEAR ENDED SEPTEMBER 30,
----------------------------------------------------------------------
1995 1994 1993 1992 1991
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income.............................. .0550 .0345 .0285 .0399 .0651
Net Realized Gains on Investments.................. -- -- -- .0008 --
------ ------ ------ ------ ------
Total From Investment Operations................... .0550 .0345 .0285 .0407 .0651
------ ------ ------ ------ ------
Less Distributions
Dividends (from net investment income)............. (.0550) (.0345) (.0285) (.0399) (.0651)
Distributions (from capital gains)................. -- -- -- (.0008) --
------ ------ ------ ------ ------
Total Distributions................................ (.0550) (.0345) (.0285) (.0407) (.0651)
------ ------ ------ ------ ------
Net Asset Value, End of Year......................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ======
Total Return....................................... 5.65% 3.51% 2.89% 4.16% 6.72%
Ratios/Supplemental Data
Net Assets, End of Year (000).................... $ 454,156 $ 397,948 $ 307,239 $ 408,900 $ 438,721
Ratio of Expenses to Average Daily Net Assets.... .41%(1) .41%(1) .44%(1) .45%(1) .45%(1)
Ratio of Net Investment Income to Average Daily
Net Assets..................................... 5.50% 3.45% 2.85% 3.89% 6.32%

- ---------------
(1) Without the waiver of advisory and administration fees, the ratios of expenses
to average daily net assets for TempCash Shares would have been: 30%, .33%,
.37%, .33%, and .34% for the years ended September 30, 1995, 1994, 1993, 1992,
and 1991, respectively. For TempCash Dollar Shares, the ratio of expenses to
average daily net assets would have been: .55%, .58%, .62%, .58%, and .59% for
the years ended September 30, 1995, 1994, 1993, 1992, and 1991, respectively.

See accompanying notes to financial statements.
</TABLE>

<PAGE> 91

Notes to Financial Statements

A. Temporary Investment Fund, Inc. (the Company) is registered under the
Investment Company Act of 1940, as amended, as a diversified open-end management
company. The Company maintains two separate portfolios, TempFund and TempCash.
Interests in the TempFund portfolio are represented by Class B (TempFund shares)
and Class B--Special Series 1 (TempFund Dollar shares) common stock. Interests
in the TempCash portfolio are represented by Class C (TempCash Dollar shares)
and Class C--Special Series 1 (TempCash shares) common stock.

Dollar shares are substantially identical in all respects to other classes of
shares, except that Dollar shares are sold to institutions which provide support
services to their customers, who beneficially own such shares, in consideration
of the Company's payment of 0.25% (on an annualized basis) of the average daily
net asset value of the shares held by the institutions for the benefit of their
customers. The Service Organization fee is applicable only to the earnings of
the respective Dollar series of shares.

B. Significant accounting policies are as follows:

Security Valuation--Portfolio securities are valued under the amortized cost
method which approximates current market value. Under this method, securities
are valued at cost when purchased and thereafter a constant proportionate
amortization of any discount or premium is recorded until maturity of the
security. Regular review and monitoring of the market-based valuation is
performed in an attempt to avoid dilution or other unfair results to
shareholders. The Company seeks to maintain the net asset value per share of
each portfolio at $1.00.

Repurchase Agreements--The Company may purchase, for each portfolio, money
market instruments from financial institutions, such as banks and non-bank
dealers, subject to the seller's agreement to repurchase them at an agreed upon
date and price. Although the securities subject to repurchase agreements may
bear maturities exceeding thirteen months, the repurchase agreements themselves
will have a maximum maturity of one year or less. The seller will be required on
a daily basis to maintain the value of the securities subject to the agreement
at not less than the repurchase price.

Dividends to Shareholders--Dividends are declared daily and paid monthly.
Dividends payable are recorded on the dividend record date. Net income for
dividend purposes includes interest accrued and discount earned and realized
gains and losses on portfolio securities and is reduced by premium amortized and
expenses accrued.

Federal Taxes--No provision is made for federal taxes as it is the Company's
intention to have each portfolio continue to qualify as a regulated investment
company and to make the requisite distributions to its shareholders which will
be sufficient to relieve it from all or substantially all federal income and
excise taxes.

Other--Investment transactions are accounted for on the trade date and the
cost of investments sold is determined by use of the specific identification
method for both financial reporting and income tax purposes. Expenses not
directly attributable to a specific portfolio are allocated between the two
portfolios based on their relative net assets.

C. Under agreements among the Company, PNC Bank, National Association (PNC Bank)
and PNC Institutional Management Corporation (PIMC), an indirect wholly owned
subsidiary of PNC Bank, PIMC manages the Company's portfolios and maintains
their financial accounts. PNC Bank is the Company's sub-adviser and custodian
and PFPC Inc. (PFPC) is the Company's transfer agent.

Provident Distributors, Inc. (PDI) is the Company's Distributor. No
compensation is

<PAGE> 92

Notes to Financial Statements (Continued)

payable by the Company to PDI for its distribution services.

The Company has entered into an Administration Agreement with PFPC and PDI for
certain administrative services.

In return for their advisory and administrative services, the Company pays
PIMC and the administrators each a fee, computed daily and payable monthly,
based upon an annualized percentage of the average net assets of each portfolio
as follows:

TempFund Portfolio:

.175% of the first $1 billion, plus .15% of the next $1 billion, .125% of the
next $1 billion, .10% of the next $1 billion, .095% of the next $1 billion, .09%
of the next $1 billion, .08% of the next $1 billion, .075% of the next $1
billion and .07% of net assets in excess of $8 billion.

TempCash Portfolio:

.175% of the first $1 billion, plus .15% of the next $1 billion, .125% of the
next $1 billion, .10% of the next $1 billion, .095% of the next $1 billion, .09%
of the next $1 billion, .085% of the next $1 billion and .08% of net assets in
excess of $7 billion.

If expenses borne by either portfolio in any fiscal year exceed the applicable
expense limitation imposed by state securities regulations, the administrators
and PIMC will each reimburse the portfolio for one-half of any excess expense up
to the amount of fees payable to it (except where such regulations require
reimbursement regardless of the fees payable to it).

The administrators and PIMC have currently agreed to reduce their fees, on an
equal basis, to the extent necessary to ensure that the ordinary operating
expenses (excluding Service Organization fees) of the TempFund portfolio and the
TempCash portfolio do not exceed .18% and .18%, respectively, of the portfolio's
average net assets. Prior to June 15, 1995, the ordinary operating expenses of
the TempFund portfolio and the TempCash portfolio did not exceed .27% and .18%,
respectively, of the portfolio's average net assets.

For the year ended September 30, 1995, the administrators and PIMC waived, on
an equal basis, administration and advisory fees payable to them in the amounts
of $1,884,683 and $5,190,756 for the TempFund portfolio and the TempCash
portfolio, respectively.

Service organization fees of $469,705 were paid to affiliates of PIMC for the
year ended September 30, 1995.

D. At September 30, 1995, the Company was authorized to issue 60 billion shares
of common stock, par value $.001 per share, of which 40 billion were classified
as Class B shares, 5 billion shares as Class B--Special Series 1 shares, 5
billion shares as Class C shares and 10 billion shares as Class C--Special
Series 1 shares.

<PAGE> 93

Notes to Financial Statements (Concluded)

Transactions in shares of each portfolio are summarized as follows:

<TABLE>
<CAPTION>
TEMPFUND PORTFOLIO TEMPCASH PORTFOLIO
--------------------------------------- --------------------------------------
YEAR ENDED YEAR ENDED
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
SEPTEMBER 30, 1995 1994 SEPTEMBER 30, 1995 1994
------------------ ----------------- ------------------ ----------------
<S> <C> <C> <C> <C>
Sale of shares
TempFund Class B....... $ 81,711,616,890 $ 103,582,951,088 -- --
TempFund Dollar........ 4,918,867,344 8,015,022,139 -- --
TempCash............... -- -- $ 71,241,203,865 $ 38,330,757,568
TempCash Dollar........ -- -- 1,873,109,402 1,909,122,664
Shares issued in
reinvestment of
dividends
TempFund Class B....... 47,014,339 35,008,506 -- --
TempFund Dollar........ 197,307 296,436 -- --
TempCash............... -- -- 59,750,637 16,989,927
TempCash Dollar........ -- -- 9,892,598 4,334,109
Shares repurchased
TempFund Class B....... (80,888,032,287) (104,663,140,416) -- --
TempFund Dollar........ (4,939,362,388) (8,021,811,244) -- --
TempCash............... -- -- (72,315,282,564) (37,495,414,117)
TempCash Dollar........ -- -- (1,826,770,163) (1,823,080,454)
------------------ ----------------- ------------------ ----------------
Increase (decrease)
in net assets derived
from capital share
transactions............. $ 850,301,205 $ (1,051,673,491) $ (958,096,225) $ 942,709,697
================= ================= ================= ================
</TABLE>

E. At September 30, 1995, a capital loss carryover of $45,427, which expires in
2003, in the TempFund portfolio and capital loss carryovers of $518,450 which
expire in 2002, in the TempCash portfolio, were available to offset future
realized gains.

F. At September 30, 1995, net assets consisted of the following:

<TABLE>
<CAPTION>
TEMPFUND TEMPCASH
--------------- ---------------
<S> <C> <C>
Paid-in capital.............................................. $ 5,433,219,534 $ 1,770,840,674
Undistributed net realized gains (losses).................... (45,427) (518,450)
--------------- ---------------
Total net assets............................................. $ 5,433,174,107 $ 1,770,322,224
=============== ===============
</TABLE>

<PAGE> 94

TEMPFUND AND TEMPCASH

APPENDIX

NRSRO Commercial Paper Ratings

The following is a description of the securities ratings of
Standard & Poor's Corporation ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Duff & Phelps Credit Rating Co. ("D&P"), Fitch Investor Services,
Inc. ("Fitch"), Thomson BankWatch, and IBCA Limited and IBCA Inc. ("IBCA").

Commercial paper ratings of S&P are current assessments of the
likelihood of timely payment of debt considered short-term in the relevant
market. Commercial paper rated A-1 by S&P indicates that the degree of safety
regarding timely payment is strong. Those issues determined to possess
extremely strong safety characteristics are denoted "A-1+".

Commercial paper ratings by Moody's are current assessments of
the ability of issuers to repay punctually promissory obligations not having an
original maturity in excess of nine months. The rating "Prime-1" is the
highest commercial paper rating assigned by Moody's. Issuers (or related
supporting institutions) rated "Prime-1" are considered to have a superior
capacity for repayment of short-term promissory obligations.

D&P uses short-term ratings for investment grade commercial
paper. The highest rating category of D&P for short-term debt is "D-1+". D&P
employs three designations, "D-1+", "D-1" and "D-1-", within the highest rating
category. "D-1+" indicates highest certainty of timely payment. Short-term
liquidity, including internal operating factors and/or access to alternative
sources of funds, is outstanding, and safety is just below risk-free U.S.
Treasury short-term obligations. "D-1" indicates very high certainty of timely
payment. Liquidity factors are excellent and supported by good fundamental
protection factors. Risk factors are minor. "D-1-" indicates high certainty
of timely payment. Liquidity factors are strong and supported by good
fundamental protection factors. Risk factors are very small.

Fitch's short-term ratings for commercial paper apply to debt
obligations that are payable on demand or have original maturities of up to
three years. The highest rating category is "F-1+". "F-1+" securities possess
exceptionally strong credit quality. Issues assigned this rating are regarded
as having the strongest degree of assurance for timely payment.

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Thomson BankWatch short-term ratings assess the likelihood of
an untimely or incomplete payment of principal or interest of unsubordinated
instruments having a maturity of one year or less which is issued by United
States commercial banks, thrifts and non-bank banks; non-United States banks;
and broker-dealers. The highest category is "TBW-1". This designation
indicates a very high degree of likelihood that principal and interest will be
paid on a timely basis.

IBCA assesses the investment quality of unsecured debt with an
original maturity of less than one year which is issued by bank holding
companies and their principal bank subsidiaries. The "A1+" rating by IBCA is
used for the highest category obligations which have the highest capacity for
timely repayment. Capacity for timely repayment of principal and interest is
substantial but may be susceptible to adverse changes in business, economic or
financial conditions.

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