February 26, 1998
      
Board of Directors
Kansas City Southern Industries, Inc.
114 West Eleventh Street
Kansas City, Missouri  64105
      
Dear Directors:
      
We have audited the consolidated financial statements included in the Kansas 
City Southern Industries, Inc. Annual Report on Form 10-K for the year ended
December 31, 1997 and issued our report thereon dated February 26, 1998.  
Note 1 to the consolidated financial statements describes changes in the 
Company's method of applying its accounting policy regarding the method of 
measuring the impairment of goodwill under APB 17 as a result of changing 
circumstances in the railroad industry and in the Company's structure.  The
change in this method of measurement relates to the level at which assets are
grouped from the business unit level to the individual investment component 
level within the business unit.  At the same time, there were changes in the 
estimates of future cash flows used to measure the recoverability of 
goodwill.  The effect of the change in the method of applying the accounting 
principle is inseparable from the changes in estimate.  Accordingly the
combined effects are reported as a change in estimate.  It should be 
understood that the preferability of one acceptable method of applying this 
policy over another has not been addressed in any authoritative accounting 
literature and in arriving at our opinion expressed below, we have relied on 
management's business planning and judgment.  Based on our discussions with 
management and the stated reasons for the change, we believe that such
change represents, in your circumstances, the adoption of a preferable 
alternative method of applying your accounting policy regarding the 
impairment of goodwill in conformity with Accounting Principles Board 
Opinion No. 20.
      
Yours very truly,
      
/s/ Price Waterhouse LLP