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SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM N-17f-2

Certificate of Accounting of Securities and Similar
Investments in the Custody of
Management Investment Companies

Pursuant to Rule 17f-2 [17 CFR 270.17f-2]

1.    Investment Company Act File Number:    Date examination completed:

                811-1714                          September 22, 1999

2. State identification Number:

AL       AK       AZ       AR       CA      CO
CT       DE       DC       FL       GA      HI
ID       IL       IN       IA       KS      KY
LA       ME       MD       MA       MI      MN
MS       MO       MT       NE       NV      NH
NJ       NM       NY       NC       ND      OH
OK       OR       PA       RI       SC      SD
TN       TX       UT       VT       VA      WA
WV       WI       WY       PUERTO RICO
Other  (specify):
3. Exact name of investment company as specified in registration statement:

     AXP Progressive Fund, Inc.

4. Name under which business is conducted, if different from above:


5. Address of principal place of business (number,street,city,state,zip code):

     IDS Tower 10, Minneapolis, MN 55440


INSTRUCTIONS

This Form must be completed by investment companies that have custody of
securities or similar investments.

Investment Company

1. All items must be completed by the investment company.

2. Give this Form to the independent  public  accountant who, in compliance with
Rule 17f-2  under the Act and  applicable  state law,  examines  securities  and
similar investments in the custody of the investment company.

Accountant

3. Submit this Form to the  Securities and Exchange  Commission and  appropriate
state  securities  administrators  when  filing the  certificate  of  accounting
required by Rule 17f-2 under the Act and applicable state law. File the original
and one copy with the Securities and Exchange  Commission's  principal office in
Washington, D. C., one copy with the regional office for the region in which the
investment  company's principal business operations are conducted,  and one copy
with the appropriate state administrator(s), if applicable.

         THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT

Note:  The  estimated  average  burden hours are made solely for purposes of the
Paperwork  Reduction  Act,  and are not derived from a  comprehensive  or even a
representative  survey or study of the costs of SEC rules and forms.  Direct any
comments  concerning  the  accuracy of the  estimated  average  burden hours for
compliance  with SEC rules and forms to  Kenneth  A.  Fogash.  Duputy  Executive
Director,  U.S.  Securities  and Exchange  Commission,  450 Fifth Street,  N.W.,
Washington,  D.C. 20549 and Gary Waxman, Clearance Officer, Office of Management
and Budget, Room 3208 New Executive Office Building, Washington, D.C. 20503.



                          Independent Auditors' Report


To the Board of Directors of
AXP Progressive Fund, Inc.:

We have examined management's assertion,  included in its representation letter,
that AXP  Progressive  Fund,  Inc. (the Fund)  complied  with the  provisions of
subsections  (b) and (c) of Rule 17f-2 under the Investment  Company Act of 1940
as of June 30,  1999 and during  the  period May 31,  1999 (the date of our last
examination)  through June 30, 1999.  Management is  responsible  for the Fund's
compliance with those provisions. Our responsibility is to express an opinion on
management's assertion about the Fund's compliance based on our examination.

Our  examination  was  made in  accordance  with  standards  established  by the
American  Institute of Certified Public Accountants and,  accordingly,  included
examining,  on a test basis,  evidence  about the Fund's  compliance  with those
requirements and performing such other procedures as we considered  necessary in
the  circumstances.  Included  among our  procedures  were the  following  tests
performed  as of June 30, 1999 and for the period from May 31, 1999 through June
30, 1999, with respect to securities transactions:

o    Count and  inspection of all  securities  located in the vault,  if any, of
     American  Express  Trust  Company,  the  Custodian  without prior notice to
     management;

o    Confirmation of all securities,  if any, held by institutions in book entry
     form (Norwest Bank  Minnesota,  N.A.,  Morgan Stanley Trust Company,  State
     Street Bank and Trust Company, and The Depository Trust Company);

o    Confirmation or examination of underlying  documentation  of all securities
     purchased but not received, hypothecated, pledged, placed in escrow, or out
     for transfer with brokers, pledges and/or transfer agents;

o    Reconciliation  of all such securities to the books and records of the Fund
     and the Custodian; and

o    Test of selected security transactions since the date of our last report.

We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Fund's compliance with
the specified requirements.

In our opinion,  management's  assertion that AXP Progressive  Fund, Inc. was in
compliance with the above  mentioned  provisions of Rule 17f-2 of the Investment
Company  Act of 1940 as of June 30,  1999 and for the period  from May 31,  1999
through June 30, 1999 is fairly stated in all material respects.

This report is intended  solely for the information and use of management of AXP
Progressive Fund, Inc. and the Securities and Exchange Commission and should not
be used for any other  purpose and is not  intended to be and should not be used
by anyone other than these specified parties.



                                                                    /s/KPMG LLP


Minneapolis, MN
September 22, 1999