FUNDAMENTAL FAMILY OF FUNDS
                          (collectively, the "Funds")
                         Fundamental Fixed Income Fund
              (Fundamental U.S. Government Strategic Income Fund)
                       (High-Yield Municipal Bond Series)
                         (Tax-Free Money Market Series)
                            The California Muni Fund
                            Fundamental Funds, Inc.
                              (New York Muni Fund)

                        Supplement Dated March 16, 1999
                                       to
                          Prospectus dated May 1, 1998


         The following  proposals were approved by  shareholders of the Funds at
the Special Meeting of Shareholders ("Special Meeting") held on March 12, 1999:

        1.     Approved new Investment Advisory Agreements between the Funds and
        Cornerstone Equity Advisors Inc. ("Cornerstone");

        2. Ratified the payment of advisory fees by the Funds to Cornerstone for
        the period  from  November  30,  1998  through  the date of the  Special
        Meeting;

        3. Elected the following persons to serve on the Fund Boards:

                             William J. Armstrong
                             L. Greg Ferrone
                             G. John Fulvio
                             Stephen C. Leslie
                             Leroy E. Rodman
                             Dr. Yvonne Scruggs-Leftwich

        4. With respect to the Tax-Free  Money Market  Series,  reclassified  an
        investment policy prohibiting  investment in other investment  companies
        as non-fundamental.