PricewaterhouseCoopers' report on portfolio pricing at the troubled hedge funds at the

Clinton Group

isn't quite finished, but enough progress has been made that firm president George Hall is telling investors not to worry about the outcome.

Hall and the directors of the $4 billion hedge fund group ended weeks of uncomfortable silence Wednesday night with a pair of letters reassuring them the six funds were in solid shape, and implying that the unreleased auditor's report would have more good news than bad.

Clinton, which has $4 billion in six hedge funds, has been tangled up in disputes and investigations of the pricing of its asset-backed securities portfolios since Oct. 31, when senior trader Anthony Barkan quit the firm and issued a public statement on his concerns over the way the portfolios are priced.

Clinton Group traded the hard-to-value securities with great success in the past, but three of its funds have lost money since the summer, and the funds are down $1.5 billion.

The firm's flagship Trinity Fund, the Clinton Multi-Strategy Fund and the Clinton Global Fixed Income Fund dropped about $400 million in the last month through trading losses and investor redemptions. The Trinity fund is down about 15.6% for the year, and the Multi-Strategy fund is up 1.63%.

Barkan's resignation triggered investigations by the

Securities and Exchange Commission

and the Commodity Futures Trading Commission and prompted the firm to hire PricewaterhouseCoopers to assess its pricing.

In his letter to investors, Hall said the firm had taken Barkan's concerns seriously.

"We felt that fully opening our books was the proper response to valuation concerns raised by the employee allegations. We were confident that there were no systemic or widespread problems in valuation procedures at Clinton Group, and therefore had no reservations in undertaking these steps," Hall wrote to investors.

Though Clinton has kept the SEC and CFTC informed of all developments, he said contractual issues have kept the firm from giving investors the good news.

"It is important for us to point out to you that it is only the method and timing of disclosure, not the substance of the report, which has kept us from sharing the findings with you."

Pricewaterhouse officials declined to comment on the report.

In a separate letter, the hedge funds' board of directors moved a deadline after which investors won't be able to make further redemptions back from Dec. 1 to Dec. 8. Clinton formerly allowed investors in some funds to redeem money every month, but recently switched to a system where investors could only get their money back quarterly, a typical practice at many hedge funds.

"We have now satisfied ourselves that the methodologies applied by the Clinton Group in valuing the funds' assets and liabilities at 31 October were consistent with industry practice and that the values produced by the Clinton Group at that date were materially accurate," the directors said in a letter sent to investors Wednesday night. The directors of the funds were not named in the letter.

Hall also said the firm had rehired portfolio manager Seth Fischoff, whose resignation in August presaged some of the hedge fund group's troubles. Fischoff declined to comment on his decision to return to the firm he left as partner and public face of the Multi-Strategy fund.

Clinton also hired Alan Malz, a former partner at RiskMetrics; he will join the firm's risk management team. Tom Jackson joined the firm as a senior trader from Caxton Associates, the world's largest hedge fund, with $10.5 billion under management.

Hall promised to keep investors better informed.

"As we have expressed to you, while we are equally as unhappy as you may be with our recent returns, we are focusing all available resources on improving our performance."