EX-99.77E LEGAL

8.  Legal Matters

Beginning in June 2004, class action lawsuits alleging violations
of the federal securities laws were filed against Citigroup Global
Markets Inc. (the "Distributor") and a number of its affiliates,
including Smith Barney Fund Management LLC and Salomon Brothers
Asset Management Inc. (the "Advisers"), substantially all of the
mutual funds managed by the Advisers, including the Fund (the "Funds"),
and directors or trustees of the Funds (collectively, the "Defendants").
The complaints alleged, among other things, that the Distributor
created various undisclosed incentives for its brokers to sell
Smith Barney and Salomon Brothers funds.  In addition, according to the
complaints, the Advisers caused the Funds to pay excessive brokerage
commissions to the Distributor for steering clients towards proprietary
funds.  The complaints also alleged that the defendants breached their
fiduciary duty to the Funds by improperly charging Rule 12b-1 fees and
by drawing on fund assets to make undisclosed payments of soft dollars
and excessive brokerage commissions.  The complaints also alleged that
the Funds failed to adequately disclose certain of the allegedly wrongful
conduct.  The complaints sought injunctive relief and compensatory and
punitive damages, rescission of the Funds' contracts with the Advisers,
recovery of all fees paid to the Advisers pursuant to such contracts and
an award of attorneys' fees and litigation expenses.
On December 15, 2004, a consolidated amended complaint (the "Complaint")
was filed alleging substantially similar causes of action.  While the
lawsuit is in its earliest stages, to the extent that the Complaint
purports to state causes of action against the Funds, Citigroup Asset
Management believes the Funds have significant defenses to such
allegations, which the Funds intend to vigorously assert in responding
to the Complaint.
Additional lawsuits arising out of these circumstances and presenting
similar allegations and requests for relief may be filed against the
Defendants in the future.
As of the date of this report, Citigroup Asset Management and the Funds
believe that the resolution of the pending lawsuit will not have a
material effect on the financial position or results of operations of
the Funds or the ability of the Advisers and their affiliates to continue
to render services to the Funds under their respective contracts.

EX-99.77B ACCT LTTR

Report of Independent Registered Public Accounting Firm


The Shareholders and Board of Directors of
Smith Barney Appreciation Fund Inc.:

In planning and performing our audit of the financial statements
of Smith Barney Appreciation Fund Inc. ("Fund") for the year
ended December 31, 2004, we considered its internal control,
including control activities for safeguarding securities,
in order to determine our auditing procedures for the purpose
of expressing our opinion on the financial statements and to
comply with the requirements of Form N-SAR, not to provide
assurance on internal control.

The management of the Fund is responsible for establishing
and maintaining internal control.  In fulfilling this
responsibility, estimates and judgments by management are
required to assess the expected benefits and related costs
of controls.  Generally, controls that are relevant to an
audit pertain to the entity's objective of preparing
financial statements for external purposes that are fairly
presented in conformity with U.S. generally accepted
accounting principles. Those controls include the safeguarding
of assets against unauthorized acquisition, use, or disposition.

Because of inherent limitations in internal control, error
or fraud may occur and not be detected.  Also, projection of
any evaluation of internal control to future periods is subject
to the risk that it may become inadequate because of changes
in conditions or that the effectiveness of the design and
operation may deteriorate.

Our consideration of internal control would not necessarily
disclose all matters in internal control that might be material
weaknesses under the standards of the Public Company Accounting
Oversight Board (United States).  A material weakness is a
significant deficiency, or combination of significant deficiencies,
that results in more than a remote likelihood that a material
misstatement of the annual or interim financial statements will
not be prevented or detected.  However, we noted no matters
involving internal control and its operation, including controls
for safeguarding securities, that we consider to be material
weaknesses as defined above as of December 31, 2004.

This report is intended solely for the information and use of
management and the Board of Directors of the Fund and the
Securities and Exchange Commission and is not intended to be
and should not be used by anyone other than these specified parties.



							KPMG LLP
New York, New York
February 18, 2005

EX-99.77E LEGAL

SMITH BARNEY APPRECIATION FUND INC.


Sub-Item 77I


Registrant incorporates by reference Registrant's Supplement to
the Prospectus and Statements of Additional Information dated
January 21, 2005 filed on January 21, 2005.
(Accession No. 0001193125-05-009919)