KEMPER INCOME FUNDS
                             Kemper High Yield Fund
                       Kemper High Yield Opportunity Fund
                   Kemper Income And Capital Preservation Fund
                     Kemper Short-Term U.S. Government Fund
                          Kemper Strategic Income Fund
                     Kemper U.S. Government Securities Fund
                            Kemper U.S. Mortgage Fund
                                 --------------

                Supplement to Statement of Additional Information
               Dated January 1, 1999, as revised February 8, 1999

The following text supplements the section entitled "Depository Receipts" in the
currently effective Statement of Additional Information:

Kemper  High  Yield  Opportunity  Fund may  invest a  portion  of its  assets in
Standard & Poor's Depository  Receipts  ("SPDRs").  SPDRs typically trade like a
share of common stock and provide investment  results that generally  correspond
to the price and yield performance of the component common stocks of the S&P 500
Index. There can be no assurance that this can be accomplished, as it may not be
possible for the Fund to  replicate  and maintain  exactly the  composition  and
relative  weightings of the S&P 500 Index  securities.  SPDRs are subject to the
risks of an investment in a broadly based portfolio of common stocks,  including
the risk that the general level of stock prices may decline,  thereby  adversely
affecting  the value of such  investment.  SPDRs are also subject to risks other
than those associated with an investment in a broadly-based  portfolio of common
stocks in that the  selection  of the  stocks  included  in the Fund may  affect
trading in SPDRs,  as compared  with  trading in a broadly  based  portfolio  of
common stocks.

The following  text replaces the  applicable  paragraph in the section  entitled
"Collateralized  Obligations" in the currently effective Statement of Additional
Information:

A Fund will currently invest in only those  collateralized  obligations that are
fully collateralized and that meet the quality standards otherwise applicable to
the Fund's  investments.  Fully  collateralized  means that the collateral  will
generate  cash  flows   sufficient  to  meet   obligations  to  holders  of  the
collateralized  obligations  under  even the most  conservative  prepayment  and
interest rate projections.  Thus, the collateralized  obligations are structured
to anticipate a worst case prepayment condition and to minimize the reinvestment
rate  risk  for  cash  flows  between   coupon  dates  for  the   collateralized
obligations.  A worst case  prepayment  condition  generally  assumes  immediate
prepayment of all securities  purchased at a premium and zero  prepayment of all
securities  purchased at a discount.  Reinvestment rate risk may be minimized by
assuming  very  conservative  reinvestment  rates and by other  means such as by
maintaining  the  flexibility  to  increase  principal  distributions  in a  low
interest rate  environment.  The effective credit quality of the  collateralized
obligations  in such  instances  is the  credit  quality  of the  issuer  of the
collateral.  The  requirements  as to  collateralization  are  determined by the
issuer or sponsor of the  collateralized  obligation in order to satisfy  rating
agencies,   if  rated.  In  addition  to  investing  in  a  pool  of  mortgages,
Mortgage-Backed  Securities or U.S.  Government  Securities,  no Fund  currently
intends  to  invest  more  than  20%  of  its  total  assets  in  collateralized
obligations  that are  collateralized  by a pool of  credit  card or  automobile
receivables  or other types of assets.  The  receivables  would include  amounts
charged for goods and services,  finance charges, late charges and other related
fees and charges.  Collection of receivables  may be affected by various social,
legal and economic factors  affecting the use of credit and repayment  patterns,
such as changes in consumer protection laws, the rate of inflation, unemployment
levels and relative  interest  rates.  Currently,  none of the Funds  intends to
invest more than 10% of its total assets in inverse floaters.

The following  text replaces the  applicable  paragraph in the section  entitled
"Zero Coupon  Government  Securities"  in the currently  effective  Statement of
Additional Information:

Zero Coupon  Government  Securities.  Subject to its  investment  objective  and
policies,  a Fund may invest in zero coupon  U.S.  Government  Securities.  Zero
coupon  bonds  are  purchased  at a  discount  from the face  amount.  The buyer
receives  only the right to  receive a fixed  payment  on a certain  date in the
future and does not receive any periodic interest payments. These securities may
include  those  created  directly  by the U.S.  Treasury  and those  created  as
collateralized obligations through various proprietary custodial, trust or other
relationships.  The  effect  of  owning  instruments  which do not make  current
interest  payments  is that a fixed  yield is  earned  not only on the  original
investment but also, in effect, on all discount accretion during the life of the
obligation.  This implicit  reinvestment of earnings at the same rate eliminates
the risk of being  unable  to  reinvest  distributions  at a rate as high as the
implicit  yield on the zero coupon  bond,  but at the same time  eliminates  any
opportunity to reinvest  earnings at higher rates. For this reason,  zero coupon
bonds are subject to substantially  greater price fluctuations during periods of
changing  market  interest  rates than those of comparable  securities  that pay
interest  currently,  which  fluctuation is greater as the period to maturity is
longer.  Zero coupon bonds created as collateralized  obligations are similar to
those  created  through the U.S.  Treasury,  but the former  investments  do not
provide  absolute  certainty of maturity or of cash flows after prior classes of
the collateralized  obligations are retired. No Fund currently intends to invest
more than 20% of its net assets in zero coupon U.S. Government Securities during
the current year.


April 16, 1999