INSTITUTIONAL CLASSES OF

                                AIM BALANCED FUND
                             AIM BASIC BALANCED FUND
                          AIM MID CAP BASIC VALUE FUND
                             AIM PREMIER EQUITY FUND

                     Supplement dated August 9, 2004 to the
             Statement of Additional Information dated April 30,2004
                 as supplemented May 18, 2004 and July 16, 2004


The following section is added after the section entitled "CALCULATION OF
PERFORMANCE DATA - Alternative Total Return Quotations".

         "Calculation of Certain Performance Data

                  AIM Basic Balanced Fund and AIM Mid Cap Basic Value Fund may
         use a restated or a blended performance calculation to derive certain
         performance data shown for their Institutional Class shares in this
         Statement of Additional Information and in the Funds' advertisements
         and other sales material. If the Funds' Institutional Class shares were
         not offered to the public during the performance period covered, the
         performance data shown will be the restated historical performance of
         the Funds' Class A shares at net asset value and reflecting the Rule
         12b-1 fees applicable to the Class A shares. If the Funds'
         Institutional Class shares were offered to the public only during a
         portion of the performance period covered, the performance data shown
         will be the blended returns of the historical performance of the Funds'
         Institutional Class shares since their inception and the restated
         historical performance of the Funds' Class A shares (for periods prior
         to inception of the Institutional Class shares) at net asset value and
         reflecting the Rule 12b-1 fees applicable to the Class A shares. If the
         Funds' Institutional Class shares were offered to the public during the
         entire performance period covered, the performance data shown will be
         the historical performance of the Funds' Institutional Class shares.

                  A restated or blended performance calculation may be used to
         derive (i) the Funds' standardized average annual total returns over a
         stated period and (ii) the Funds' non-standardized cumulative total
         returns over a stated period."