Franklin Corefolio Allocation Fund Class C NCSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-CSRS

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-07851

Franklin Fund Allocator Series
(Exact name of registrant as specified in charter)

One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices)(Zip code)

Craig S. Tyle, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)

Registrant's telephone number, including area code:(650) 312-2000

Date of fiscal year end: 12/31

Date of reporting period: 6/30/15

Item 1. Reports to Stockholders.

Franklin Templeton Investments

Gain From Our Perspective®

At Franklin Templeton Investments, we’re dedicated to one goal: delivering exceptional asset management for our clients. By bringing together multiple, world-class investment teams in a single firm, we’re able to offer specialized expertise across styles and asset classes, all supported by the strength and resources of one of the world’s largest asset managers. This has helped us to become a trusted partner to individual and institutional investors across the globe.

Focus on Investment Excellence

At the core of our firm, you’ll find multiple independent investment teams—each with a focused area of expertise—from traditional to alternative strategies and multi-asset solutions. And because our portfolio groups operate autonomously, their strategies can be combined to deliver true style and asset class diversification.

All of our investment teams share a common commitment to excellence grounded in rigorous, fundamental research and robust, disciplined risk management. Decade after decade, our consistent, research-driven processes have helped Franklin Templeton earn an impressive record of strong, long-term results.

Global Perspective Shaped by Local Expertise

In today’s complex and interconnected world, smart investing demands a global perspective. Franklin Templeton pioneered international investing over 60 years ago, and our expertise in emerging markets spans more than a quarter of a century. Today, our investment professionals are on the ground across the globe, spotting investment ideas and potential risks firsthand. These locally based teams bring in-depth understanding of local companies, economies and cultural nuances, and share their best thinking across our global research network.

Strength and Experience

Franklin Templeton is a global leader in asset management serving clients in over 150 countries.¹We run our business with the same prudence we apply to asset management, staying focused on delivering relevant investment solutions, strong long-term results and reliable, personal service. This approach, focused on putting clients first, has helped us to become one of the most trusted names in financial services.

1. As of 12/31/14. Clients are represented by the total number of shareholder accounts.

Not FDIC Insured | May Lose Value | No Bank Guarantee


Contents

Semiannual Report
Economic and Market Overview	3
Franklin LifeSmart^TM
2015 Retirement Target Fund	4
Franklin LifeSmart^TM
2020 Retirement Target Fund	11
Franklin LifeSmart^TM
2025 Retirement Target Fund	18
Franklin LifeSmart^TM
2030 Retirement Target Fund	25
Franklin LifeSmart^TM
2035 Retirement Target Fund	32
Franklin LifeSmart^TM
2040 Retirement Target Fund	39
Franklin LifeSmart^TM
2045 Retirement Target Fund	46
Franklin LifeSmart^TM
2050 Retirement Target Fund	53
Franklin LifeSmart^TM
2055 Retirement Target Fund	60
Financial Highlights and
Statements of Investments	67
Financial Statements	130
Notes to Financial Statements	144
Shareholder Information	166

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Semiannual Report

Economic and Market Overview

The global economy expanded moderately during the six months under review despite slowing growth in some countries. As measured by the MSCI World Index, stocks in global developed markets advanced overall during the six-month period amid a generally accommodative monetary policy environment and signs of economic improvement in Europe and Japan. Oil prices rebounded from earlier lows as demand picked up despite rising inventories and strong global supply, while gold prices declined marginally during the period under review.

U.S. economic growth was mixed during the six months under review. In 2015’s first quarter, U.S. dollar strength, low energy prices, and a labor dispute at West Coast ports led exports to decline. In the second quarter, business capital spending rebounded and manufacturing and non-manufacturing activities increased, contributing to strong job gains. During the six-month period, the U.S. Federal Reserve Board (Fed) kept its target interest rate at 0%–0.25% while considering when an increase would be appropriate, based on labor market and inflation data.

Outside the U.S., the U.K. economy slowed in 2015’s first quarter as the mining and agriculture sectors contracted. In the eurozone, economic growth improved somewhat during the six-month period. The region avoided deflation as the annual inflation rate rose in May. The European Central Bank (ECB) maintained its benchmark interest rates during the period and also expanded its asset purchases to boost inflation and the economy. The region generally benefited from a weaker euro that helped exports, the ECB’s accommodative policy and an improved 2015 eurozone growth forecast, which helped limit fears about Greece’s debt situation.

The Japanese economy continued to grow in 2015’s first quarter after exiting recession in the previous quarter, driven by an increase in private demand as business investment and private consumption rose. The Bank of Japan maintained its monetary policy during the review period, but lowered its economic growth and inflation forecasts at its April meeting.

In emerging markets, economic growth generally moderated. Greece’s credit default due to the lack of progress in negotiations weighed on emerging market stocks toward period-end. China’s government implemented market-friendly policies to support new economic drivers that could help steer the economy toward more sustainable growth. Lower interest rates there fueled massive stock market speculation and a 60% price gain up to mid-June 2015 for the domestic A-share market.¹Concerned the market was overheated, the People’s Bank of China reduced liquidity, which led to a market panic in the last two weeks of June, exacerbated by certain government intervention measures. Central bank actions varied across emerging markets, as some banks raised interest rates in response to rising inflation and weakening currencies, while others lowered interest rates to promote economic growth. In the recent global environment, emerging market stocks, as measured by the MSCI Emerging Markets Index, rose for the six-month period.

The foregoing information reflects our analysis and opinions as of June 30, 2015. The information is not a complete analysis of every aspect of any market, country, industry, security or fund. Statements of fact are from sources considered reliable.

1. Source: MSCI.
See www.franklintempletondatasources.com for additional data provider information.

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Semiannual Report | 3

Franklin LifeSmart 2015 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2015 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2015 approaches. The target date is the approximate retirement year of the investor.

*The asset allocation is based on the Statement of Investments (SOI), which
classifies each underlying fund and other fund investments into a broad asset
class based on its predominant investments under normal market conditions.

Performance Overview

The Fund’s Class A shares delivered a +1.61% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500^®), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 6.

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. Please visit franklintempleton.com or call (800) 342-5236 for most recent month-end performance.

Investment Strategy

When selecting equity funds, we consider the foreign and domestic exposure, market capitalization ranges, and investment style (growth vs. value) of the underlying Franklin Templeton funds and other fund investments (collectively, “fund investments”). When selecting fixed income funds, we focus primarily on maximizing income appropriate to the Fund’s specific risk profile. In evaluating the risk level of the fund investments, including alternative investment funds, we analyze such factors as: (a) relative and absolute performance, including correlations with other fund investments as well as corresponding benchmarks, and (b) their volatility (the variability of returns from one period to the next). We attempt to invest the assets of each Fund in the same fund investments but will vary the fund investments’ allocation percentages based upon each Fund’s risk/return level. We change the Fund’s target asset allocations over time, reducing its exposure to equity investments, and it becomes increasingly conservative until the stated target date. At the “landing point” (reached at the target date), the Fund reaches its most conservative asset allocation and thereafter, such strategic asset allocation will become fixed.

1. Source: Morningstar.
2. Source: Payden & Rygel.
The indexes are unmanaged and include reinvestment of any income or distributions. One cannot invest directly in an index, and an index is not representative of the
Fund’s portfolio.
See www.franklintempletondatasources.com for additional data provider information.

The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Fund’s SOI, which begins on page 72.

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FRANKLIN LIFESMART 2015 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Templeton Global Total Return Fund – Class R6	22.8	%
Franklin Low Duration Total Return Fund – Class R6	17.2	%
Franklin Strategic Income Fund – Class R6	6.1	%
iShares Core S&P 500 ETF	6.0	%
Franklin K2 Alternative Strategies Fund – Class R6	5.9	%
iShares Intermediate Credit Bond ETF	3.7	%
Franklin Growth Fund – Class R6	3.5	%
Franklin Emerging Market Debt Opportunities Fund	3.2	%
Franklin Rising Dividends Fund – Class R6	2.8	%
Franklin International Small Cap Growth Fund – Class R6	2.7	%

Manager’s Discussion

The Fund’s performance can be attributed largely to its allocation among equities and fixed income securities and to the actual performance of the fund investments. This allocation shifts every year, in accordance with the target date associated with the portfolio.

At period-end, Franklin LifeSmart 2015 Retirement Target Fund allocated 36.1% of total net assets to equity, 54.0% to fixed income and 6.7% to alternative strategies. Domestic equity exposure was 67.6% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. iShares Core S&P 500 ETF, at 6.0% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 51.9% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund –Class R6 was our largest fixed income fund weighting at 22.8% of total net assets.

Our largest domestic growth fund holding, Franklin Growth Fund – Class R6, and our largest foreign equity fund holding, Franklin International Small Cap Growth Fund – Class R6, outperformed the MSCI ACWI, while our largest domestic value fund holding, Franklin Rising Dividends Fund – Class R6, underperformed the index. On the fixed income side, Templeton Global Total Return Fund – Class R6 and Franklin Low Duration Total Return Fund – Class R6 outperformed the Barclays Multiverse Index.

Thank you for your continued participation in Franklin LifeSmart 2015 Retirement Target Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio holdings as of June 30, 2015, the end of the reporting period. The way we implement our main investment strategies and the resulting portfolio holdings may change depending on factors such as market and economic conditions. These opinions may not be relied upon as investment advice or an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but the investment manager makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.

CFA^®is a trademark owned by CFA Institute.

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FRANKLIN LIFESMART 2015 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015

Your dividend income will vary depending on dividends or interest paid by securities in the Fund’s portfolio, adjusted for operating expenses of each class. Capital gain distributions are net profits realized from the sale of portfolio securities. The performance table does not reflect any taxes that a shareholder would pay on Fund dividends, capital gain distributions, if any, or any realized gains on the sale of Fund shares. Total return reflects reinvestment of the Fund’s dividends and capital gain distributions, if any, and any unrealized gains or losses.


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FTRAX)	$	11.60	$	11.67	-$	0.07
C (FRTCX)	$	11.47	$	11.55	-$	0.08
R (FBRLX)	$	11.56	$	11.64	-$	0.08
R6 (FLMTX)	$	11.65	$	11.72	-$	0.07
Advisor (FLRDX)	$	11.64	$	11.71	-$	0.07


Distributions¹(1/1/15–6/30/15)
		Dividend		Long-Term
Share Class		Income		Capital Gain		Total
A	$	0.0952	$	0.1640	$	0.2592
C	$	0.0588	$	0.1640	$	0.2228
R	$	0.0875	$	0.1640	$	0.2515
R6	$	0.1143	$	0.1640	$	0.2783
Advisor	$	0.1119	$	0.1640	$	0.2759

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FRANKLIN LIFESMART 2015 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Cumulative total return excludes sales charges. Average annual total returns and value of $10,000 investment include maximum sales charges. Class A: 5.75% maximum initial sales charge; Class C: 1% contingent deferred sales charge in first year only;

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							0.98	%	1.47	%
6-Month	+1.61	%	-4.22	%	$	9,578
1-Year	+1.11	%	-4.69	%	$	9,531
5-Year	+46.93	%	+6.74	%	$	13,853
Since Inception (8/1/06)	+63.83	%	+5.00	%	$	15,441
C							1.68	%	2.17	%
6-Month	+1.22	%	+0.23	%	$	10,023
1-Year	+0.36	%	-0.57	%	$	9,943
5-Year	+41.76	%	+7.23	%	$	14,176
Since Inception (8/1/06)	+53.91	%	+4.96	%	$	15,391
R							1.18	%	1.67	%
6-Month	+1.46	%	+1.46	%	$	10,146
1-Year	+0.94	%	+0.94	%	$	10,094
5-Year	+45.32	%	+7.76	%	$	14,532
Since Inception (8/1/06)	+60.79	%	+5.47	%	$	16,079
R6							0.63	%	1.07	%
6-Month	+1.76	%	+1.76	%	$	10,176
1-Year	+1.45	%	+1.45	%	$	10,145
Since Inception (5/1/13)	+13.51	%	+6.03	%	$	11,351
Advisor							0.68	%	1.17	%
6-Month	+1.74	%	+1.74	%	$	10,174
1-Year	+1.41	%	+1.41	%	$	10,141
5-Year	+49.05	%	+8.31	%	$	14,905
Since Inception (8/1/06)	+68.36	%	+6.02	%	$	16,836

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

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FRANKLIN LIFESMART 2015 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

The Fund’s investment risk changes over time as its asset allocation changes. The Fund’s ability to achieve its investment goal depends upon the investment manager’s skill in determining the Fund’s broad asset allocation mix and selecting underlying funds. There is the possibility that the investment manager’s evaluations and assumptions regarding asset classes and underlying funds will not successfully achieve the Fund’s investment goal in view of actual market trends. Since the Fund invests in underlying funds, which may engage in a variety of investment strategies involving certain risks, the Fund is subject to those same risks. The Fund’s investment in ETFs may subject the Fund to additional risks than if the Fund had invested directly in the ETFs’ underlying securities. All investments involve risks, including possible loss of principal. Principal invested is not guaranteed at any time, including at or after the Fund’s retirement target date, nor is there any guarantee that the Fund will provide sufficient income at or through the investor’s retirement. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as the prices of bonds in the Fund adjust to a rise in interest rates, the Fund’s share price may decline. Foreign investing carries additional risks such as currency and market volatility and political or social instability, risks that are heightened in developing countries. Derivatives, including currency management strategies, involve costs and can create economic leverage in the portfolio, which may result in significant volatility and cause the Fund to participate in losses (as well as gains) in an amount that exceeds the Fund’s initial investment. These risks are described more fully in, and additional risks are described in, the Fund’s prospectus. Investors should consult their financial advisors for help selecting the appropriate fund of funds, or fund combination, based on an evaluation of their investment objectives, retirement time horizons and risk tolerance.


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

1. The distribution amount is the sum of the dividend payments to shareholders for the period shown and includes only estimated tax-basis net investment income and
capital gain.
2. The Fund has an expense reduction contractually guaranteed through at least 4/30/16 and a fee waiver associated with any investment in a Franklin Templeton money
fund, contractually guaranteed through at least its current fiscal year-end. The transfer agent has contractually agreed to cap transfer agency fees for Class R6 shares so
that transfer agency fees for that class do not exceed 0.01% until at least 4/30/16. Fund investment results reflect the expense reduction, fee waiver and fee cap, to the
extent applicable; without these reductions, the results would have been lower. As of October 2013, the Fund’s glide path was modified, and among other changes, reflects
a lower starting allocation to equity funds; such a change can impact performance.
3. Cumulative total return represents the change in value of an investment over the periods indicated.
4. Average annual total return represents the average annual change in value of an investment over the periods indicated. Six-month return has not been annualized.
5. These figures represent the value of a hypothetical $10,000 investment in the Fund over the periods indicated.
6. Figures are as stated in the Fund’s current prospectus and include the effect of acquired fund fees and expenses. In periods of market volatility, assets may decline
significantly, causing total annual Fund operating expenses to become higher than the figures shown.

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FRANKLIN LIFESMART 2015 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

The following table shows ongoing costs of investing in the Fund and can help you understand these costs and compare them with those of other mutual funds. The table assumes a $1,000 investment held for the six months indicated.

Actual Fund Expenses

The first line (Actual) for each share class listed in the table provides actual account values and expenses. The “Ending Account Value” is derived from the Fund’s actual return, which includes the effect of Fund expenses.

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

Information in the second line (Hypothetical) for each class in the table can help you compare ongoing costs of investing in the Fund with those of other mutual funds. This information may not be used to estimate the actual ending account balance or expenses you paid during the period. The hypothetical “Ending Account Value” is based on the actual expense ratio for each class and an assumed 5% annual rate of return before expenses, which does not represent the Fund’s actual return. The figure under the heading “Expenses Paid During Period” shows the hypothetical expenses your account would have incurred under this scenario. You can compare this figure with the 5% hypothetical examples that appear in shareholder reports of other funds.

Please note that expenses shown in the table are meant to highlight ongoing costs and do not reflect any transaction costs, such as sales charges. Therefore, the second line for each class is useful in comparing ongoing costs only, and will not help you compare total costs of owning different funds. In addition, if transaction costs were included, your total costs would have been higher. Please refer to the Fund prospectus for additional information on operating expenses.

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FRANKLIN LIFESMART 2015 RETIREMENT TARGET FUND
YOUR FUND’S EXPENSES



		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,016.10	$	1.75	$	5.00
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.01
C
Actual	$	1,000	$	1,012.20	$	5.19	$	8.43
Hypothetical (5% return before expenses)	$	1,000	$	1,019.64	$	5.21	$	8.45
R
Actual	$	1,000	$	1,014.60	$	2.75	$	5.99
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.01
R6
Actual	$	1,000	$	1,017.60	$	0.00	$	3.25
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.26
Advisor
Actual	$	1,000	$	1,017.40	$	0.25	$	3.50
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.51

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.04%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.00%; C: 1.69%; R: 1.20%; R6: 0.65%; and Advisor: 0.70%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

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Franklin LifeSmart 2020 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2020 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2020 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares delivered a +2.33% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 13.

Investment Strategy

FRANKLIN LIFESMART 2020 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Templeton Global Total Return Fund – Class R6	14.0	%
Franklin Low Duration Total Return Fund – Class R6	10.9	%
Franklin Growth Fund – Class R6	6.4	%
iShares Core S&P 500 ETF	6.1	%
Franklin K2 Alternative Strategies Fund – Class R6	5.7	%
Franklin International Small Cap Growth Fund – Class R6	5.3	%
Franklin Rising Dividends Fund – Class R6	5.0	%
Franklin DynaTech Fund – Class R6	4.9	%
Franklin Focused Core Equity Fund – Class R6	4.5	%
Franklin Mutual International Fund – Class R6	3.9	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2020 Retirement Target Fund allocated 57.6% of total net assets to equity, 33.1% to fixed income and 6.5% to alternative strategies. Domestic equity exposure was 65.5% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. iShares Core S&P 500 ETF, at 6.1% of the Fund’s total investments, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 52.9% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund –Class R6 was our largest fixed income fund weighting at 14.0% of total net assets.

Thank you for your participation in Franklin LifeSmart 2020 Retirement Target Fund. We look forward to serving your future investment needs.

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FRANKLIN LIFESMART 2020 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FLRMX)	$	11.25	$	11.14	+$	0.11
C (FLRQX)	$	11.19	$	11.08	+$	0.11
R (FLRVX)	$	11.22	$	11.12	+$	0.10
R6 (FRTSX)	$	11.27	$	11.15	+$	0.12
Advisor (FLROX)	$	11.27	$	11.15	+$	0.12


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0480	$	0.0035	$	0.0999	$	0.1514
C	$	0.0172	$	0.0035	$	0.0999	$	0.1206
R	$	0.0473	$	0.0035	$	0.0999	$	0.1507
R6	$	0.0625	$	0.0035	$	0.0999	$	0.1659
Advisor	$	0.0602	$	0.0035	$	0.0999	$	0.1636

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Semiannual Report | 13

FRANKLIN LIFESMART 2020 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Cumulative total return excludes sales charges. Average annual total return and value of $10,000 investment include maximum sales charges. Class A: 5.75% maximum initial sales charge; Class C: 1% contingent deferred sales charge in first year only;

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.00	%	2.90	%
6-Month	+2.33	%	-3.55	%	$	9,645
1-Year	+2.70	%	-3.20	%	$	9,680
Since Inception (7/1/13)	+18.74	%	+5.80	%	$	11,191
C							1.70	%	3.60	%
6-Month	+2.07	%	+1.07	%	$	10,107
1-Year	+1.99	%	+1.00	%	$	10,100
Since Inception (7/1/13)	+17.04	%	+8.20	%	$	11,704
R							1.20	%	3.10	%
6-Month	+2.24	%	+2.24	%	$	10,224
1-Year	+2.45	%	+2.45	%	$	10,245
Since Inception (7/1/13)	+18.16	%	+8.71	%	$	11,816
R6							0.65	%	2.46	%
6-Month	+2.55	%	+2.55	%	$	10,255
1-Year	+3.07	%	+3.07	%	$	10,307
Since Inception (7/1/13)	+19.52	%	+9.34	%	$	11,952
Advisor							0.70	%	2.60	%
6-Month	+2.53	%	+2.53	%	$	10,253
1-Year	+3.03	%	+3.03	%	$	10,303
Since Inception (7/1/13)	+19.39	%	+9.28	%	$	11,939

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

14 | Semiannual Report

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FRANKLIN LIFESMART 2020 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

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Semiannual Report | 15

FRANKLIN LIFESMART 2020 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

16 | Semiannual Report

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FRANKLIN LIFESMART 2020 RETIREMENT TARGET FUND

YOUR FUND’S EXPENSES


		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,023.30	$	1.76	$	5.22
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.21
C
Actual	$	1,000	$	1,020.70	$	5.26	$	8.72
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.70
R
Actual	$	1,000	$	1,022.40	$	2.76	$	6.22
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.21
R6
Actual	$	1,000	$	1,025.50	$	0.00	$	3.47
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.46
Advisor
Actual	$	1,000	$	1,025.30	$	0.25	$	3.72
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.71

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.04%; C: 1.74%; R: 1.24%; R6: 0.69%; and Advisor: 0.74%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

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Semiannual Report | 17

Franklin LifeSmart 2025 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2025 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2025 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares delivered a +2.92% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East Index (EAFE), which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 20.

Investment Strategy

FRANKLIN LIFESMART 2025 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Templeton Global Total Return Fund – Class R6	8.8	%
Franklin Rising Dividends Fund – Class R6	7.0	%
Franklin Growth Fund – Class R6	6.9	%
Franklin International Small Cap Growth Fund – Class R6	6.4	%
Franklin Low Duration Total Return Fund – Class R6	6.4	%
Franklin DynaTech Fund – Class R6	6.1	%
Franklin K2 Alternative Strategies Fund – Class R6	6.0	%
iShares Core S&P 500 ETF	6.0	%
Franklin Focused Core Equity Fund – Class R6	5.5	%
Franklin Mutual International Fund – Class R6	5.1	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2025 Retirement Target Fund allocated 71.2% of total net assets to equity, 20.4% to fixed income and 6.8% to alternative strategies. Domestic equity exposure was 65.3% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Rising Dividends Fund – Class R6, at 7.0% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 51.5% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund – Class R6 was our largest fixed income fund weighting at 8.8% of total net assets.

Thank you for your continued participation in Franklin LifeSmart 2025 Retirement Target Fund. We look forward to serving your future investment needs.

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Semiannual Report | 19

FRANKLIN LIFESMART 2025 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FTRTX)	$	12.51	$	12.36	+$	0.15
C (FTTCX)	$	12.28	$	12.18	+$	0.10
R (FRELX)	$	12.44	$	12.31	+$	0.13
R6 (FTLMX)	$	12.56	$	12.39	+$	0.17
Advisor (FLRFX)	$	12.55	$	12.38	+$	0.17


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0075	$	0.0108	$	0.1957	$	0.2140
C	$	0.0075	$	0.0108	$	0.1957	$	0.2140
R	$	0.0075	$	0.0108	$	0.1957	$	0.2140
R6	$	0.0075	$	0.0108	$	0.1957	$	0.2140
Advisor	$	0.0075	$	0.0108	$	0.1957	$	0.2140

20 | Semiannual Report

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FRANKLIN LIFESMART 2025 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.01	%	1.49	%
6-Month	+2.92	%	-2.97	%	$	9,703
1-Year	+3.29	%	-2.62	%	$	9,738
5-Year	+63.16	%	+8.99	%	$	15,382
Since Inception (8/1/06)	+70.66	%	+5.48	%	$	16,085
C							1.71	%	2.19	%
6-Month	+2.55	%	+1.55	%	$	10,155
1-Year	+2.56	%	+1.60	%	$	10,160
5-Year	+57.58	%	+9.52	%	$	15,758
Since Inception (8/1/06)	+60.36	%	+5.44	%	$	16,036
R							1.21	%	1.69	%
6-Month	+2.77	%	+2.77	%	$	10,277
1-Year	+2.95	%	+2.95	%	$	10,295
5-Year	+61.35	%	+10.04	%	$	16,135
Since Inception (8/1/06)	+67.51	%	+5.96	%	$	16,751
R6							0.66	%	1.05	%
6-Month	+3.08	%	+3.08	%	$	10,308
1-Year	+3.63	%	+3.63	%	$	10,363
Since Inception (5/1/13)	+22.97	%	+10.02	%	$	12,297
Advisor							0.71	%	1.19	%
6-Month	+3.08	%	+3.08	%	$	10,308
1-Year	+3.53	%	+3.53	%	$	10,353
5-Year	+65.58	%	+10.61	%	$	16,558
Since Inception (8/1/06)	+75.07	%	+6.49	%	$	17,507

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

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Semiannual Report | 21

FRANKLIN LIFESMART 2025 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

22 | Semiannual Report

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FRANKLIN LIFESMART 2025 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

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Semiannual Report | 23


FRANKLIN LIFESMART 2025 RETIREMENT TARGET FUND
YOUR FUND’S EXPENSES



		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,029.20	$	1.76	$	5.28
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.26
C
Actual	$	1,000	$	1,025.50	$	5.27	$	8.79
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.75
R
Actual	$	1,000	$	1,027.70	$	2.77	$	6.28
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.26
R6
Actual	$	1,000	$	1,030.80	$	0.00	$	3.52
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.51
Advisor
Actual	$	1,000	$	1,030.80	$	0.25	$	3.78
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.76

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.05%; C: 1.75%; R: 1.25%; R6: 0.70%; and Advisor: 0.75%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

24 | Semiannual Report

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Franklin LifeSmart 2030 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2030 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2030 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares delivered a +3.10% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor's 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 27.

Investment Strategy

FRANKLIN LIFESMART 2030 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Franklin Growth Fund – Class R6	8.2	%
Franklin International Small Cap Growth Fund – Class R6	7.2	%
Franklin Rising Dividends Fund – Class R6	7.1	%
Franklin DynaTech Fund – Class R6	6.9	%
Templeton Global Total Return Fund – Class R6	6.2	%
Franklin K2 Alternative Strategies Fund – Class R6	6.0	%
iShares Core S&P 500 ETF	5.9	%
Franklin Focused Core Equity Fund – Class R6	5.6	%
Franklin Mutual International Fund – Class R6	5.3	%
Franklin Low Duration Total Return Fund – Class R6	4.7	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2030 Retirement Target Fund allocated 75.9% of total net assets to equity, 14.8% to fixed income and 6.9% to alternative strategies. Domestic equity exposure was 64.4% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Growth Fund – Class R6, at 8.2% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 52.0% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund –Class R6 was our largest fixed income fund weighting at 6.2% of total net assets.

Thank you for your participation in Franklin LifeSmart 2030 Retirement Target Fund. We look forward to serving your future investment needs.

26 | Semiannual Report

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FRANKLIN LIFESMART 2030 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FLRSX)	$	11.65	$	11.45	+$	0.20
C (FLRTX)	$	11.53	$	11.38	+$	0.15
R (FLRWX)	$	11.63	$	11.44	+$	0.19
R6 (FLERX)	$	11.69	$	11.47	+$	0.22
Advisor (FLRZX)	$	11.68	$	11.47	+$	0.21


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0038	$	0.0039	$	0.1489	$	0.1566
C	$	0.0038	$	0.0039	$	0.1489	$	0.1566
R	$	0.0038	$	0.0039	$	0.1489	$	0.1566
R6	$	0.0038	$	0.0039	$	0.1489	$	0.1566
Advisor	$	0.0038	$	0.0039	$	0.1489	$	0.1566

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Semiannual Report | 27

FRANKLIN LIFESMART 2030 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.02	%	2.95	%
6-Month	+3.10	%	-2.84	%	$	9,716
1-Year	+4.43	%	-1.57	%	$	9,843
Since Inception (7/1/13)	+21.77	%	+7.14	%	$	11,477
C							1.72	%	3.65	%
6-Month	+2.67	%	+1.67	%	$	10,167
1-Year	+3.66	%	+2.66	%	$	10,266
Since Inception (7/1/13)	+20.07	%	+9.59	%	$	12,007
R							1.22	%	3.15	%
6-Month	+3.01	%	+3.01	%	$	10,301
1-Year	+4.23	%	+4.23	%	$	10,423
Since Inception (7/1/13)	+21.21	%	+10.11	%	$	12,121
R6							0.67	%	2.41	%
6-Month	+3.26	%	+3.26	%	$	10,326
1-Year	+4.74	%	+4.74	%	$	10,474
Since Inception (7/1/13)	+22.50	%	+10.70	%	$	12,250
Advisor							0.72	%	2.65	%
6-Month	+3.18	%	+3.18	%	$	10,318
1-Year	+4.70	%	+4.70	%	$	10,470
Since Inception (7/1/13)	+22.32	%	+10.62	%	$	12,232

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

28 | Semiannual Report

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FRANKLIN LIFESMART 2030 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

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Semiannual Report | 29

FRANKLIN LIFESMART 2030 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

30 | Semiannual Report

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FRANKLIN LIFESMART 2030 RETIREMENT TARGET FUND

YOUR FUND’S EXPENSES


		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,031.00	$	1.76	$	5.34
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.31
C
Actual	$	1,000	$	1,026.70	$	5.28	$	8.84
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.80
R
Actual	$	1,000	$	1,030.10	$	2.77	$	6.34
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.31
R6
Actual	$	1,000	$	1,032.60	$	0.00	$	3.58
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.56
Advisor
Actual	$	1,000	$	1,031.80	$	0.25	$	3.83
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.81

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.06%; C: 1.76%; R: 1.26%; R6: 0.71%; and Advisor: 0.76%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

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Semiannual Report | 31

Franklin LifeSmart 2035 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2035 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2035 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares delivered a +3.09% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 34.

Investment Strategy

FRANKLIN LIFESMART 2035 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Franklin Rising Dividends Fund – Class R6	8.3	%
Franklin Growth Fund – Class R6	8.0	%
Franklin International Small Cap Growth Fund – Class R6	7.2	%
Franklin DynaTech Fund – Class R6	6.7	%
Franklin Focused Core Equity Fund – Class R6	6.3	%
iShares Core S&P 500 ETF	6.1	%
Franklin K2 Alternative Strategies Fund – Class R6	6.0	%
Franklin Mutual International Fund – Class R6	5.7	%
Templeton Global Total Return Fund – Class R6	4.7	%
Franklin Growth Opportunities Fund – Class R6	4.5	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2035 Retirement Target Fund allocated 80.4% of total net assets to equity, 11.2% to fixed income and 6.8% to alternative strategies. Domestic equity exposure was 65.5% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Rising Dividends Fund – Class R6, at 8.3% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 51.8% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund – Class R6 was our largest fixed income fund weighting at 4.7% of total net assets.

Thank you for your continued participation in Franklin LifeSmart 2035 Retirement Target Fund. We look forward to serving your future investment needs.

The foregoing information reflects our analysis, opinions and portfolio
holdings as of June 30, 2015, the end of the reporting period. The
way we implement our main investment strategies and the resulting
portfolio holdings may change depending on factors such as market
and economic conditions. These opinions may not be relied upon as
investment advice or an offer for a particular security. The information
is not a complete analysis of every aspect of any market, country,
industry, security or the Fund. Statements of fact are from sources
considered reliable, but the investment manager makes no repre-
sentation or warranty as to their completeness or accuracy. Although
historical performance is no guarantee of future results, these insights
may help you understand our investment management philosophy.

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Semiannual Report | 33

FRANKLIN LIFESMART 2035 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FRTAX)	$	12.83	$	12.67	+$	0.16
C (FTRCX)	$	12.54	$	12.43	+$	0.11
R (FLRGX)	$	12.81	$	12.66	+$	0.15
R6 (FMTLX)	$	12.93	$	12.75	+$	0.18
Advisor (FLRHX)	$	12.94	$	12.75	+$	0.19


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0079	$	0.0154	$	0.2111	$	0.2344
C	$	0.0079	$	0.0154	$	0.2111	$	0.2344
R	$	0.0079	$	0.0154	$	0.2111	$	0.2344
R6	$	0.0079	$	0.0154	$	0.2111	$	0.2344
Advisor	$	0.0079	$	0.0154	$	0.2111	$	0.2344

34 | Semiannual Report

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FRANKLIN LIFESMART 2035 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.02	%	1.58	%
6-Month	+3.09	%	-2.82	%	$	9,718
1-Year	+3.70	%	-2.23	%	$	9,777
5-Year	+70.62	%	+9.97	%	$	16,086
Since Inception (8/1/06)	+72.09	%	+5.58	%	$	16,220
C							1.72	%	2.28	%
6-Month	+2.74	%	+1.74	%	$	10,174
1-Year	+3.03	%	+2.06	%	$	10,206
5-Year	+65.03	%	+10.54	%	$	16,503
Since Inception (8/1/06)	+61.74	%	+5.54	%	$	16,174
R							1.22	%	1.78	%
6-Month	+3.01	%	+3.01	%	$	10,301
1-Year	+3.56	%	+3.56	%	$	10,356
5-Year	+69.19	%	+11.09	%	$	16,919
Since Inception (8/1/06)	+69.25	%	+6.08	%	$	16,925
R6							0.67	%	1.09	%
6-Month	+3.22	%	+3.22	%	$	10,322
1-Year	+4.09	%	+4.09	%	$	10,409
Since Inception (5/1/13)	+25.15	%	+10.92	%	$	12,515
Advisor							0.72	%	1.28	%
6-Month	+3.30	%	+3.30	%	$	10,330
1-Year	+4.12	%	+4.12	%	$	10,412
5-Year	+73.37	%	+11.63	%	$	17,337
Since Inception (8/1/06)	+77.00	%	+6.62	%	$	17,700

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

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Semiannual Report | 35

FRANKLIN LIFESMART 2035 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

36 | Semiannual Report

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FRANKLIN LIFESMART 2035 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

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Semiannual Report | 37


FRANKLIN LIFESMART 2035 RETIREMENT TARGET FUND
YOUR FUND’S EXPENSES



		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,030.90	$	1.76	$	5.34
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.31
C
Actual	$	1,000	$	1,027.40	$	5.28	$	8.85
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.80
R
Actual	$	1,000	$	1,030.10	$	2.77	$	6.34
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.31
R6
Actual	$	1,000	$	1,032.20	$	0.00	$	3.58
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.56
Advisor
Actual	$	1,000	$	1,033.00	$	0.25	$	3.83
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.81

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.06%; C: 1.76%; R: 1.26%; R6: 0.71%; and Advisor: 0.76%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

38 | Semiannual Report

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Franklin LifeSmart 2040 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2040 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2040 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares delivered a +3.32% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 41.

Investment Strategy

FRANKLIN LIFESMART 2040 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Franklin Growth Fund – Class R6	9.8	%
Franklin DynaTech Fund – Class R6	7.7	%
Franklin International Small Cap Growth Fund – Class R6	7.6	%
Franklin Rising Dividends Fund – Class R6	7.4	%
Franklin Focused Core Equity Fund – Class R6	6.5	%
Franklin K2 Alternative Strategies Fund – Class R6	6.1	%
Franklin Mutual International Fund – Class R6	6.1	%
iShares Core S&P 500 ETF	6.0	%
Franklin Growth Opportunities Fund – Class R6	4.7	%
iShares S&P 500 Value ETF	4.2	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2040 Retirement Target Fund allocated 84.3% of total net assets to equity, 7.4% to fixed income and 6.9% to alternative strategies. Domestic equity exposure was 65.1% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Growth Fund – Class R6, at 9.8% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 51.4% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund –Class R6 was our largest fixed income fund weighting at 3.2% of total net assets.

Thank you for your participation in Franklin LifeSmart 2040 Retirement Target Fund. We look forward to serving your future investment needs.

40 | Semiannual Report

franklintempleton.com

FRANKLIN LIFESMART 2040 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FLADX)	$	11.81	$	11.58	+$	0.23
C (FLOLX)	$	11.70	$	11.52	+$	0.18
R (FLSGX)	$	11.80	$	11.58	+$	0.22
R6 (FLREX)	$	11.86	$	11.61	+$	0.25
Advisor (FLSHX)	$	11.85	$	11.61	+$	0.24


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0017	$	0.0066	$	0.1482	$	0.1565
C	$	0.0017	$	0.0066	$	0.1482	$	0.1565
R	$	0.0017	$	0.0066	$	0.1482	$	0.1565
R6	$	0.0017	$	0.0066	$	0.1482	$	0.1565
Advisor	$	0.0017	$	0.0066	$	0.1482	$	0.1565

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Semiannual Report | 41

FRANKLIN LIFESMART 2040 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.02	%	3.92	%
6-Month	+3.32	%	-2.65	%	$	9,735
1-Year	+5.06	%	-0.95	%	$	9,905
Since Inception (7/1/13)	+23.27	%	+7.80	%	$	11,618
C							1.72	%	4.62	%
6-Month	+2.90	%	+1.90	%	$	10,190
1-Year	+4.31	%	+3.31	%	$	10,331
Since Inception (7/1/13)	+21.55	%	+10.26	%	$	12,155
R							1.22	%	4.12	%
6-Month	+3.23	%	+3.23	%	$	10,323
1-Year	+4.94	%	+4.94	%	$	10,494
Since Inception (7/1/13)	+22.84	%	+10.85	%	$	12,284
R6							0.67	%	3.22	%
6-Month	+3.48	%	+3.48	%	$	10,348
1-Year	+5.43	%	+5.43	%	$	10,543
Since Inception (7/1/13)	+24.18	%	+11.45	%	$	12,418
Advisor							0.72	%	3.62	%
6-Month	+3.39	%	+3.39	%	$	10,339
1-Year	+5.41	%	+5.41	%	$	10,541
Since Inception (7/1/13)	+23.99	%	+11.37	%	$	12,399

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

42 | Semiannual Report

franklintempleton.com

FRANKLIN LIFESMART 2040 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

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Semiannual Report | 43

FRANKLIN LIFESMART 2040 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

44 | Semiannual Report

franklintempleton.com

FRANKLIN LIFESMART 2040 RETIREMENT TARGET FUND

YOUR FUND’S EXPENSES


		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,033.20	$	1.77	$	5.40
Hypothetical (5% return before expenses)	$	1,000	$	1,023.05	$	1.76	$	5.36
C
Actual	$	1,000	$	1,029.00	$	5.28	$	8.90
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.85
R
Actual	$	1,000	$	1,032.30	$	2.77	$	6.40
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.36
R6
Actual	$	1,000	$	1,034.80	$	0.00	$	3.63
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.61
Advisor
Actual	$	1,000	$	1,033.90	$	0.24	$	3.87
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.24	$	3.84

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.07%; C: 1.77%; R: 1.27%; R6: 0.72%; and Advisor: 0.77% ), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

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Semiannual Report | 45

Franklin LifeSmart 2045 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2045 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2045 approaches. The target date is the approximate retirement year of the investor.

*The asset allocation is based on the Statement of Investments (SOI), which
classifies each underlying fund and other fund investment into a broad asset
class based on its predominant investments under normal market conditions.

Performance Overview

The Fund’s Class A shares delivered a +3.11% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 48.

Investment Strategy

FRANKLIN LIFESMART 2045 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Franklin Rising Dividends Fund – Class R6	9.2	%
Franklin Growth Fund – Class R6	8.8	%
Franklin International Small Cap Growth Fund – Class R6	7.5	%
Franklin DynaTech Fund – Class R6	7.5	%
Franklin Focused Core Equity Fund – Class R6	6.4	%
iShares Core S&P 500 ETF	6.0	%
Franklin K2 Alternative Strategies Fund – Class R6	6.0	%
Franklin Mutual International Fund – Class R6	6.0	%
iShares S&P 500 Value ETF	3.8	%
Franklin Growth Opportunities Fund – Class R6	3.7	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2045 Retirement Target Fund allocated 83.8% of total net assets to equity, 8.1% to fixed income and 6.8% to alternative strategies. Domestic equity exposure was 64.6% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Rising Dividends Fund – Class R6, at 9.2% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 51.9% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund – Class R6 was our largest fixed income fund weighting at 3.4% of total net assets.

Thank you for your continued participation in Franklin LifeSmart 2045 Retirement Target Fund. We look forward to serving your future investment needs.

franklintempleton.com Semiannual Report | 47

FRANKLIN LIFESMART 2045 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FTTAX)	$	12.85	$	12.70	+$	0.15
C (FLRIX)	$	12.53	$	12.42	+$	0.11
R (FLRJX)	$	12.80	$	12.66	+$	0.14
R6 (FMLTX)	$	12.95	$	12.77	+$	0.18
Advisor (FLRLX)	$	12.94	$	12.76	+$	0.18


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0076	$	0.0135	$	0.2282	$	0.2493
C	$	0.0076	$	0.0135	$	0.2282	$	0.2493
R	$	0.0076	$	0.0135	$	0.2282	$	0.2493
R6	$	0.0076	$	0.0135	$	0.2282	$	0.2493
Advisor	$	0.0076	$	0.0135	$	0.2282	$	0.2493

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FRANKLIN LIFESMART 2045 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.02	%	1.78	%
6-Month	+3.11	%	-2.78	%	$	9,722
1-Year	+3.86	%	-2.14	%	$	9,786
5-Year	+75.89	%	+10.63	%	$	16,569
Since Inception (8/1/06)	+74.39	%	+5.73	%	$	16,436
C							1.72	%	2.48	%
6-Month	+2.86	%	+1.86	%	$	10,186
1-Year	+3.22	%	+2.24	%	$	10,224
5-Year	+70.00	%	+11.20	%	$	17,000
Since Inception (8/1/06)	+63.97	%	+5.71	%	$	16,397
R							1.22	%	1.98	%
6-Month	+3.04	%	+3.04	%	$	10,304
1-Year	+3.66	%	+3.66	%	$	10,366
5-Year	+74.09	%	+11.73	%	$	17,409
Since Inception (8/1/06)	+71.32	%	+6.23	%	$	17,132
R6							0.67	%	1.18	%
6-Month	+3.33	%	+3.33	%	$	10,333
1-Year	+4.17	%	+4.17	%	$	10,417
Since Inception (5/1/13)	+26.23	%	+11.36	%	$	12,623
Advisor							0.72	%	1.48	%
6-Month	+3.33	%	+3.33	%	$	10,333
1-Year	+4.12	%	+4.12	%	$	10,412
5-Year	+78.46	%	+12.28	%	$	17,846
Since Inception (8/1/06)	+79.12	%	+6.76	%	$	17,912

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

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FRANKLIN LIFESMART 2045 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

50 | Semiannual Report

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FRANKLIN LIFESMART 2045 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

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FRANKLIN LIFESMART 2045 RETIREMENT TARGET FUND
YOUR FUND’S EXPENSES



		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,031.10	$	1.76	$	5.39
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.36
C
Actual	$	1,000	$	1,028.60	$	5.28	$	8.90
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.85
R
Actual	$	1,000	$	1,030.40	$	2.77	$	6.39
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.36
R6
Actual	$	1,000	$	1,033.30	$	0.00	$	3.63
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.61
Advisor
Actual	$	1,000	$	1,033.30	$	0.25	$	3.88
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.86

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.07%; C: 1.77%; R: 1.27%; R6: 0.72%; and Advisor: 0.77%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

52 | Semiannual Report

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Franklin LifeSmart 2050 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2050 Retirement Target Fund covers the period ended June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2050 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares delivered a +3.23% cumulative total return for the six months ended June 30, 2015. In comparison, the Fund’s new equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, returned +2.97%, while its old equity benchmark, the Standard & Poor’s 500 Index (S&P 500), a broad measure of U.S. stock performance, returned +1.23%.¹Another previous equity benchmark, the MSCI Europe, Australasia, Far East (EAFE) Index, which measures global stock performance for developed markets excluding the U.S. and Canada, posted a +5.88% total return.¹The Fund’s new fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -2.90% total return, while its old fixed income benchmark, the Barclays U.S. Aggregate Bond Index, which tracks U.S. investment-grade bonds, had a -0.10% total return.¹The Fund added the P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, which returned +0.02%.²You can find the Fund’s long-term performance data in the Performance Summary beginning on page 55.

Investment Strategy

FRANKLIN LIFESMART 2050 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Franklin Growth Fund – Class R6	10.7	%
Franklin Rising Dividends Fund – Class R6	7.9	%
Franklin DynaTech Fund – Class R6	7.8	%
Franklin International Small Cap Growth Fund – Class R6	7.7	%
Franklin Focused Core Equity Fund – Class R6	6.7	%
Franklin K2 Alternative Strategies Fund – Class R6	6.2	%
Franklin Mutual International Fund – Class R6	6.2	%
iShares Core S&P 500 ETF	6.1	%
Franklin Growth Opportunities Fund – Class R6	3.9	%
Templeton Foreign Fund – Class R6	3.6	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2050 Retirement Target Fund allocated 83.7% of total net assets to equity, 7.0% to fixed income and 7.1% to alternative strategies. Domestic equity exposure was 64.9% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Growth Fund – Class R6, at 10.7% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 52.9% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund – Class R6 was our largest fixed income fund weighting at 2.9% of total net assets.

Thank you for your participation in Franklin LifeSmart 2050 Retirement Target Fund. We look forward to serving your future investment needs.

54 | Semiannual Report franklintempleton.com

FRANKLIN LIFESMART 2050 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		12/31/14		Change
A (FLSJX)	$	11.84	$	11.62	+$	0.22
C (FLSKX)	$	11.74	$	11.56	+$	0.18
R (FLSNX)	$	11.84	$	11.63	+$	0.21
R6 (FRLEX)	$	11.89	$	11.65	+$	0.24
Advisor (FLSOX)	$	11.89	$	11.65	+$	0.24


Distributions¹(1/1/15–6/30/15)
		Dividend		Short-Term		Long-Term
Share Class		Income		Capital Gain		Capital Gain		Total
A	$	0.0031	$	0.0052	$	0.1501	$	0.1584
C	$	0.0031	$	0.0052	$	0.1501	$	0.1584
R	$	0.0031	$	0.0052	$	0.1501	$	0.1584
R6	$	0.0031	$	0.0052	$	0.1501	$	0.1584
Advisor	$	0.0031	$	0.0052	$	0.1501	$	0.1584

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FRANKLIN LIFESMART 2050 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.02	%	4.79	%
6-Month	+3.23	%	-2.71	%	$	9,729
1-Year	+5.01	%	-1.05	%	$	9,895
Since Inception (7/1/13)	+23.58	%	+7.93	%	$	11,647
C							1.72	%	5.49	%
6-Month	+2.91	%	+1.91	%	$	10,191
1-Year	+4.19	%	+3.19	%	$	10,319
Since Inception (7/1/13)	+21.94	%	+10.44	%	$	12,194
R							1.22	%	4.99	%
6-Month	+3.15	%	+3.15	%	$	10,315
1-Year	+4.80	%	+4.80	%	$	10,480
Since Inception (7/1/13)	+23.19	%	+11.00	%	$	12,319
R6							0.67	%	3.89	%
6-Month	+3.40	%	+3.40	%	$	10,340
1-Year	+5.32	%	+5.32	%	$	10,532
Since Inception (7/1/13)	+24.46	%	+11.58	%	$	12,446
Advisor							0.72	%	4.49	%
6-Month	+3.40	%	+3.40	%	$	10,340
1-Year	+5.29	%	+5.29	%	$	10,529
Since Inception (7/1/13)	+24.39	%	+11.55	%	$	12,439

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

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FRANKLIN LIFESMART 2050 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

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FRANKLIN LIFESMART 2050 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distri- bution and service (12b-1) fees, and other Fund expenses.
All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

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FRANKLIN LIFESMART 2050 RETIREMENT TARGET FUND

YOUR FUND’S EXPENSES


		Beginning		Ending		Expenses Paid		Expenses Paid
		Account		Account		During Period* During Period**
Share Class		Value 1/1/15		Value 6/30/15		1/1/15–6/30/15		1/1/15–6/30/15
A
Actual	$	1,000	$	1,032.30	$	1.76	$	5.39
Hypothetical (5% return before expenses)	$	1,000	$	1,023.06	$	1.76	$	5.36
C
Actual	$	1,000	$	1,029.10	$	5.28	$	8.90
Hypothetical (5% return before expenses)	$	1,000	$	1,019.59	$	5.26	$	8.85
R
Actual	$	1,000	$	1,031.50	$	2.77	$	6.40
Hypothetical (5% return before expenses)	$	1,000	$	1,022.07	$	2.76	$	6.36
R6
Actual	$	1,000	$	1,034.00	$	0.00	$	3.63
Hypothetical (5% return before expenses)	$	1,000	$	1,024.79	$	0.00	$	3.61
Advisor
Actual	$	1,000	$	1,034.00	$	0.25	$	3.88
Hypothetical (5% return before expenses)	$	1,000	$	1,024.55	$	0.25	$	3.86

*Expenses are calculated using the most recent six-month expense ratio excluding expenses of the fund investments, net of expense waivers,
annualized for each class (A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.
**Expenses are calculated using the most recent six-month expense ratio including expenses of the fund investments, net of expense waivers,
annualized for each class (A: 1.07%; C: 1.77%; R: 1.27%; R6: 0.72%; and Advisor: 0.77%), multiplied by the average account value over the
period, multiplied by 181/365 to reflect the one-half year period.

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Franklin LifeSmart 2055 Retirement Target Fund

This semiannual report for Franklin LifeSmart 2055 Retirement Target Fund covers the period since the Fund’s inception on May 1, 2015, through June 30, 2015.

Your Fund’s Goal and Main Investments

The Fund seeks the highest level of long-term total return, which consists of capital appreciation and income, consistent with the Fund’s asset allocation. The Fund allocates among the broad asset classes of equity, fixed income and alternative (non-traditional) investments by investing primarily in a distinctly weighted combination of underlying funds, predominantly other Franklin Templeton mutual funds, with an increasing emphasis on income as the target date of 2055 approaches. The target date is the approximate retirement year of the investor.

Performance Overview

The Fund’s Class A shares had a -1.05% cumulative total return for the period since the Fund’s inception through June 30, 2015.

In comparison, the Fund’s equity benchmark, the MSCI All Country World Index (ACWI), which measures equity market performance in global developed and emerging markets, had a -2.78% total return for the same period.¹The Fund’s fixed income benchmark, the Barclays Multiverse Index, a broad-based measure of the global fixed income bond market, had a -1.91% total return.¹The P&R 90 Day U.S. T-Bill Index, a proxy for short-term investments and other net assets, returned +0.01%.²You can find the Fund’s performance data in the Performance Summary beginning on page 62.

Investment Strategy

FRANKLIN LIFESMART 2055 RETIREMENT TARGET FUND


Top 10 Fund Holdings
6/30/15
	% of Total
Net Assets
Franklin Growth Fund – Class R6	10.5	%
Franklin Rising Dividends Fund – Class R6	7.8	%
Franklin International Small Cap Growth Fund – Class R6	7.7	%
Franklin DynaTech Fund – Class R6	7.7	%
Franklin Focused Core Equity Fund – Class R6	6.5	%
Franklin Mutual International Fund – Class R6	6.1	%
iShares Core S&P 500 ETF	5.6	%
Franklin K2 Alternative Strategies Fund – Class R6	5.6	%
Franklin Growth Opportunities Fund – Class R6	3.8	%
Templeton Foreign Fund – Class R6	3.6	%

Manager’s Discussion

At period-end, Franklin LifeSmart 2055 Retirement Target Fund allocated 82.1% of total net assets to equity, 6.3% to fixed income and 6.4% to alternative strategies. Domestic equity exposure was 64.6% of the total equity weighting, and foreign equity made up the balance. The portfolio was diversified across capitalization sizes and investment styles, and on June 30, 2015, we held shares in large-, mid- and small-capitalization equity funds, representing both growth and value styles. Franklin Growth Fund – Class R6, at 10.5% of the Fund’s total net assets, was our largest equity fund weighting at period-end. On the fixed income side, domestic exposure was 54.0% of the Fund’s total fixed income weighting, with the balance in foreign fixed income. Templeton Global Total Return Fund – Class R6 was our largest fixed income fund weighting at 2.6% of total net assets.

Our largest domestic growth fund holding, Franklin Growth Fund – Class R6, outperformed the MSCI ACWI, and our largest domestic value fund holding, Franklin Rising Dividends Fund – Class R6, and our largest foreign equity fund holding,

Franklin International Small Cap Growth Fund – Class R6, performed better than the index. On the fixed income side, Templeton Global Total Return Fund – Class R6 performed better than the Barclays Multiverse Index.

Thank you for your participation in Franklin LifeSmart 2055 Retirement Target Fund. We look forward to serving your future investment needs.

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Semiannual Report | 61

FRANKLIN LIFESMART 2055 RETIREMENT TARGET FUND

Performance Summary as of June 30, 2015


Net Asset Value
Share Class (Symbol)		6/30/15		5/1/15		Change
A (FLTFX)	$	9.89	$	10.00	-$	0.11
C (FLTNX)	$	9.88	$	10.00	-$	0.12
R (FLSBX	$	9.89	$	10.00	-$	0.11
R6 (FLSZX)	$	9.89	$	10.00	-$	0.11
Advisor (FLTKX)	$	9.89	$	10.00	-$	0.11


Distributions¹(5/1/15–6/30/15)
Dividend
Share Class		Income
A	$	0.0046
C	$	0.0045
R	$	0.0045
R6	$	0.0052
Advisor	$	0.0046

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FRANKLIN LIFESMART 2055 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY

Performance as of 6/30/15²

Class R/R6/Advisor Class: no sales charges.


	Cumulative		Average Annual			Value of	Total Annual Operating Expenses⁶
Share Class	Total Return³		Total Return⁴		$	10,000 Investment⁵	(with waiver)		(without waiver)
A							1.03	%	3.11	%
Since Inception (5/1/15)	-1.05	%	-6.74	%	$	9,326

C							1.73	%	3.81	%
Since Inception (5/1/15)	-1.16	%	-2.14	%	$	9,786

R							1.23	%	3.31	%
Since Inception (5/1/15)	-1.06	%	-1.06	%	$	9,894

R6							0.68	%	2.39	%
Since Inception (5/1/15)	-1.05	%	-1.05	%	$	9,895

Advisor							0.73	%	2.81	%
Since Inception (5/1/15)	-1.05	%	-1.05	%	$	9,895

Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.

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Semiannual Report | 63

FRANKLIN LIFESMART 2055 RETIREMENT TARGET FUND

PERFORMANCE SUMMARY


Class C:	These shares have higher annual fees and expenses than Class A shares.
Class R:	Shares are available to certain eligible investors as described in the prospectus. These shares have higher annual fees and expenses than Class A shares.
Class R6:	Shares are available to certain eligible investors as described in the prospectus.
Advisor Class:	Shares are available to certain eligible investors as described in the prospectus.

1. The distribution amount is the sum of the dividend payments to shareholders for the period shown and includes only estimated tax-basis net investment income.
2. The Fund has an expense reduction contractually guaranteed through at least 4/30/16 and a fee waiver associated with any investment in a Franklin Templeton money
fund, contractually guaranteed through at least its current fiscal year-end. The transfer agent has contractually agreed to cap transfer agency fees for Class R6 shares so
that transfer agency fees for that class do not exceed 0.01% until at least 4/30/16. Fund investment results reflect the expense reduction, fee waiver and fee cap, to the
extent applicable; without these reductions, the results would have been lower.
3. Cumulative total return represents the change in value of an investment over the period indicated.
4. Average annual total return represents the average annual change in value of an investment over the period indicated. Because the Fund has existed for less than one
year, performance shown is not annualized.
5. These figures represent the value of a hypothetical $10,000 investment in the Fund over the period indicated.
6. Figures are as stated in the Fund’s current prospectus and include the effect of acquired fund fees and expenses. In periods of market volatility, assets may decline
significantly, causing total annual Fund operating expenses to become higher than the figures shown.

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FRANKLIN LIFESMART 2055 RETIREMENT TARGET FUND

Your Fund’s Expenses

As a Fund shareholder, you can incur two types of costs:

Transaction costs, including sales charges (loads) on Fund purchases; and
Ongoing Fund costs, including management fees, distribu- tion and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses.

Actual Fund Expenses

You can estimate the expenses you paid during the period by following these steps. Of course, your account value and expenses will differ from those in this illustration:

1.	Divide your account value by $1,000.
	If an account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6.
2.	Multiply the result by the number under the heading “Expenses Paid During Period.”
	If Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50.

In this illustration, the estimated expenses paid this period are $64.50.

Hypothetical Example for Comparison with Other Funds

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FRANKLIN LIFESMART 2055 RETIREMENT TARGET FUND
YOUR FUND’S EXPENSES



			Beginning				Expenses Paid		Expenses Paid
			Account Value		Ending		During Period*		During Period**
			Actual 5/1/15		Account		Actual 5/1/15–6/30/15		Actual 5/1/15–6/30/15
Share Class	Hypothetical 1/1/15				Value 6/30/15		Hypothetical 1/1/15–6/30/15		Hypothetical 1/1/15–6/30/15
A
Actual		$	1,000	$	989.50	$	0.57	$	1.78
Hypothetical (5% return before expenses)		$	1,000	$	1,023.06	$	1.76	$	5.46
C
Actual		$	1,000	$	988.40	$	1.72	$	2.93
Hypothetical (5% return before expenses)		$	1,000	$	1,019.59	$	5.26	$	8.95
R
Actual		$	1,000	$	989.40	$	0.90	$	2.11
Hypothetical (5% return before expenses)		$	1,000	$	1,022.07	$	2.76	$	6.46
R6
Actual		$	1,000	$	989.50	$	0.00	$	1.21
Hypothetical (5% return before expenses)		$	1,000	$	1,024.79	$	0.00	$	3.71
Advisor
Actual		$	1,000	$	989.50	$	0.09	$	1.30
Hypothetical (5% return before expenses)		$	1,000	$	1,024.55	$	0.25	$	3.96

*Expenses are calculated using the most recent expense ratio excluding expenses of the fund investments, net of expense waivers, annualized for each class
(A: 0.35%; C: 1.05%; R: 0.55%; R6: 0.00%; and Advisor: 0.05%), multiplied by the average account value over the period, multiplied by 60/365 to reflect the actual
period and by 181/365 to reflect the hypothetical one-half year period.
**Expenses are calculated using the most recent expense ratio including expenses of the fund investments, net of expense waivers, annualized for each class
(A: 1.09%; C: 1.79%; R: 1.29%; R6: 0.74%; and Advisor: 0.79%), multiplied by the average account value over the period, multiplied by 60/365 to reflect the actual
period and by 181/365 to reflect the hypothetical one-half year period.

66 | Semiannual Report

franklintempleton.com


								FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2015 Retirement Target Fund
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.67		$	12.28		$	11.67		$	10.92		$	11.25		$	10.17
Income from investment operations^a:
Net investment income^b,c		0.10			0.39			0.25			0.24			0.24			0.24
Net realized and unrealized gains (losses)		0.09			(0.01	)		1.16			0.76			(0.33	)		1.05
Total from investment operations		0.19			0.38			1.41			1.00			(0.09	)		1.29
Less distributions from:
Net investment income		(0.10	)		(0.40	)		(0.27	)		(0.25	)		(0.24	)		(0.21	)
Net realized gains		(0.16	)		(0.59	)		(0.53	)		—			—			—
Total distributions		(0.26	)		(0.99	)		(0.80	)		(0.25	)		(0.24	)		(0.21	)
Net asset value, end of period	$	11.60		$	11.67		$	12.28		$	11.67		$	10.92		$	11.25

Total return^d		1.61	%		3.07	%		12.27	%		9.20	%		(0.82	)%		12.77	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		0.83	%		0.84	%		0.83	%		0.71	%		0.80	%		0.80	%
Expenses net of waiver and payments by
affiliates^f		0.35	%		0.35	%		0.38	%		0.45	%		0.45	%		0.45	%
Net investment income^c		1.65	%		3.20	%		2.04	%		2.13	%		2.09	%		2.30	%

Supplemental data
Net assets, end of period (000’s)	$	48,272		$	48,121		$	44,347		$	37,507		$	31,073		$	27,230
Portfolio turnover rate		6.82	%		68.98	%		73.66	%		25.12	%		31.55	%		17.27	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.65% for the period ended June 30, 2015.

franklintempleton.com The accompanying notes are an integral part of these financial statements. | Semiannual Report | 67

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2015 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.55		$	12.16		$	11.57		$	10.83		$	11.16		$	10.10
Income from investment operations^a:
Net investment income^b,c		0.06			0.30			0.16			0.16			0.16			0.16
Net realized and unrealized gains (losses)		0.08			(0.01	)		1.15			0.75			(0.33	)		1.04
Total from investment operations		0.14			0.29			1.31			0.91			(0.17	)		1.20
Less distributions from:
Net investment income		(0.06	)		(0.31	)		(0.19	)		(0.17	)		(0.16	)		(0.14	)
Net realized gains		(0.16	)		(0.59	)		(0.53	)		—			—			—
Total distributions		(0.22	)		(0.90	)		(0.72	)		(0.17	)		(0.16	)		(0.14	)
Net asset value, end of period	$	11.47		$	11.55		$	12.16		$	11.57		$	10.83		$	11.16

Total return^d		1.22	%		2.39	%		11.46	%		8.44	%		(1.51	)%		11.91	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		1.52	%		1.54	%		1.53	%		1.41	%		1.50	%		1.50	%
Expenses net of waiver and payments by
affiliates^f		1.04	%		1.05	%		1.08	%		1.15	%		1.15	%		1.15	%
Net investment income^c		0.96	%		2.50	%		1.34	%		1.43	%		1.39	%		1.60	%

Supplemental data
Net assets, end of period (000’s)	$	21,999		$	21,189		$	20,395		$	16,912		$	14,217		$	12,133
Portfolio turnover rate		6.82	%		68.98	%		73.66	%		25.12	%		31.55	%		17.27	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.65% for the period ended June 30, 2015.

68 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2015 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.64		$	12.25		$	11.64		$	10.89		$	11.22		$	10.15
Income from investment operations^a:
Net investment income^b,c		0.09			0.36			0.22			0.22			0.21			0.20
Net realized and unrealized gains (losses)		0.08			(—)^d			1.16			0.75			(0.32	)		1.06
Total from investment operations		0.17			0.36			1.38			0.97			(0.11	)		1.26
Less distributions from:
Net investment income		(0.09	)		(0.38	)		(0.24	)		(0.22	)		(0.22	)		(0.19	)
Net realized gains		(0.16	)		(0.59	)		(0.53	)		—			—			—
Total distributions		(0.25	)		(0.97	)		(0.77	)		(0.22	)		(0.22	)		(0.19	)
Net asset value, end of period	$	11.56		$	11.64		$	12.25		$	11.64		$	10.89		$	11.22

Total return^e		1.46	%		2.89	%		12.04	%		8.96	%		(1.02	)%		12.46	%

Ratios to average net assets^f
Expenses before waiver and payments by
affiliates^g		1.03	%		1.04	%		1.03	%		0.91	%		1.00	%		1.00	%
Expenses net of waiver and payments by
affiliates^g		0.55	%		0.55	%		0.58	%		0.65	%		0.65	%		0.65	%
Net investment income^c		1.45	%		3.00	%		1.84	%		1.93	%		1.89	%		2.10	%

Supplemental data
Net assets, end of period (000’s)	$	3,791		$	2,828		$	2,279		$	1,862		$	1,815		$	1,401
Portfolio turnover rate		6.82	%		68.98	%		73.66	%		25.12	%		31.55	%		17.27	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dAmount rounds to less than $0.01 per share.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.65% for the period ended June 30, 2015.

franklintempleton.com The accompanying notes are an integral part of these financial statements. | Semiannual Report | 69

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2015 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.72		$	12.32		$	12.17
Income from investment operations^b:
Net investment income^c,d		0.12			0.57			0.49
Net realized and unrealized gains (losses)		0.08			(0.14	)		0.44
Total from investment operations		0.20			0.43			0.93
Less distributions from:
Net investment income		(0.11	)		(0.44	)		(0.25	)
Net realized gains		(0.16	)		(0.59	)		(0.53	)
Total distributions		(0.27	)		(1.03	)		(0.78	)
Net asset value, end of period	$	11.65		$	11.72		$	12.32

Total return^e		1.76	%		3.49	%		7.78	%

Ratios to average net assets^f
Expenses before waiver and payments by affiliates^g		0.42	%		0.44	%		0.60	%
Expenses net of waiver and payments by affiliates^g		0.00	%		0.00	%		0.00	%
Net investment income^d		2.00	%		3.55	%		2.42	%

Supplemental data
Net assets, end of period (000’s)	$	5,767		$	6,709		$	763
Portfolio turnover rate		6.82	%		68.98	%		73.66	%

^aFor the period May 1, 2013 (effective date) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.65% for the period ended June 30, 2015.

70 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2015 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.71		$	12.31		$	11.70		$	10.94		$	11.28		$	10.19
Income from investment operations^a:
Net investment income^b,c		0.12			0.43			0.29			0.28			0.26			0.39
Net realized and unrealized gains (losses)		0.08			(—)^d			1.16			0.76			(0.33	)		0.94
Total from investment operations		0.20			0.43			1.45			1.04			(0.07	)		1.33
Less distributions from:
Net investment income		(0.11	)		(0.44	)		(0.31	)		(0.28	)		(0.27	)		(0.24	)
Net realized gains		(0.16	)		(0.59	)		(0.53	)		—			—			—
Total distributions		(0.27	)		(1.03	)		(0.84	)		(0.28	)		(0.27	)		(0.24	)
Net asset value, end of period	$	11.64		$	11.71		$	12.31		$	11.70		$	10.94		$	11.28

Total return^e		1.74	%		3.45	%		12.55	%		9.59	%		(0.61	)%		13.16	%

Ratios to average net assets^f
Expenses before waiver and payments by
affiliates^g		0.53	%		0.54	%		0.53	%		0.41	%		0.50	%		0.50	%
Expenses net of waiver and payments by
affiliates^g		0.05	%		0.05	%		0.08	%		0.15	%		0.15	%		0.15	%
Net investment income^c		1.95	%		3.50	%		2.34	%		2.43	%		2.39	%		2.60	%

Supplemental data
Net assets, end of period (000’s)	$	2,913		$	2,194		$	2,494		$	1,840		$	1,501		$	1,571
Portfolio turnover rate		6.82	%		68.98	%		73.66	%		25.12	%		31.55	%		17.27	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dAmount rounds to less than $0.01 per share.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.65% for the period ended June 30, 2015.

franklintempleton.com The accompanying notes are an integral part of these financial statements. | Semiannual Report | 71


FRANKLIN FUND ALLOCATOR SERIES




Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2015 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 96.8%
Alternative Strategies 6.7%
^aFranklin K2 Alternative Strategies Fund, Class R6	442,778	$	4,888,266
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	90,466		655,878
			5,544,144
Domestic Equity 24.4%
^a,bFranklin Biotechnology Discovery Fund, Class R6	2,854		586,893
^a,bFranklin DynaTech Fund, Class R6	41,397		2,096,330
^aFranklin Focused Core Equity Fund, Class R6	136,611		2,114,738
^aFranklin Growth Fund, Class R6	37,860		2,925,067
^a,bFranklin Growth Opportunities Fund, Class R6	44,632		1,588,892
^aFranklin Real Estate Securities Fund, Class R6	15,919		326,667
^aFranklin Rising Dividends Fund, Class R6	44,412		2,292,984
^a,bFranklin Small Cap Growth Fund, Class R6	38,303		810,118
^aFranklin Utilities Fund, Class R6	58,640		934,719
iShares Core S&P 500 ETF	23,985		4,970,172
iShares S&P 500 Value ETF	16,439		1,515,840
			20,162,420
Domestic Fixed Income 28.0%
^aFranklin Low Duration Total Return Fund, Class R6	1,419,764		14,226,039
^aFranklin Short Duration U.S. Government ETF	7,837		775,642
^aFranklin Strategic Income Fund, Class R6	512,893		5,046,863
iShares Intermediate Credit Bond ETF	28,315		3,082,371
			23,130,915
Foreign Equity 11.7%
^aFranklin International Growth Fund, Class R6	65,348		737,782
^aFranklin International Small Cap Growth Fund, Class R6	112,810		2,208,822
^aFranklin Mutual International Fund, Class R6	127,811		1,973,405
iShares Global Infrastructure ETF	16,240		659,830
iShares MSCI All Country Asia ex Japan ETF	9,306		586,278
^aTempleton China World Fund, Class R6	15,253		504,115
^aTempleton Foreign Fund, Class R6	129,703		935,158
^aTempleton Frontier Markets Fund, Class R6	53,980		753,562
WisdomTree Japan Hedged Equity Fund ETF (Japan)	23,735		1,357,642
			9,716,594
Foreign Fixed Income 26.0%
^aFranklin Emerging Market Debt Opportunities Fund	245,173		2,655,222
^aTempleton Global Total Return Fund, Class R6	1,534,450		18,858,391
			21,513,613
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $76,430,345)			80,067,686

72 | Semiannual Report

franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2015 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $2,276,285) 2.7%
Money Market Funds 2.7%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	2,276,285	$	2,276,285
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $78,706,630) 99.5%			82,343,971
Other Assets, less Liabilities 0.5%			396,932
Net Assets 100.0%		$	82,740,903

See Abbreviations on page 165.

^aSee Note 3(f) regarding investments in Underlying Funds.
^bNon-income producing.

franklintempleton.com The accompanying notes are an integral part of these financial statements. | Semiannual Report | 73


FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2020 Retirement Target Fund
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.14		$	10.94		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.07			0.33			0.16
Net realized and unrealized gains (losses)		0.19			0.20			0.91
Total from investment operations		0.26			0.53			1.07
Less distributions from:
Net investment income		(0.05	)		(0.27	)		(0.13	)
Net realized gains		(0.10	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.33	)		(0.13	)
Net asset value, end of period	$	11.25		$	11.14		$	10.94

Total return^f		2.33	%		4.83	%		10.69	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.46	%		2.25	%		11.14	%
Expenses net of waiver and payments by affiliates^h		0.35	%		0.35	%		0.24	%
Net investment income^d		1.13	%		3.20	%		3.12	%

Supplemental data
Net assets, end of period (000’s)	$	14,026		$	7,302		$	2,189
Portfolio turnover rate		9.97	%		64.70	%		33.36	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.69% for the period ended June 30, 2015.

74 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2020 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.08		$	10.90		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.02			0.24			0.18
Net realized and unrealized gains (losses)		0.21			0.21			0.83
Total from investment operations		0.23			0.45			1.01
Less distributions from:
Net investment income		(0.02	)		(0.21	)		(0.11	)
Net realized gains		(0.10	)		(0.06	)		(—)^e
Total distributions		(0.12	)		(0.27	)		(0.11	)
Net asset value, end of period	$	11.19		$	11.08		$	10.90

Total return^f		2.07	%		4.09	%		10.16	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		2.16	%		2.95	%		11.95	%
Expenses net of waiver and payments by affiliates^h		1.05	%		1.05	%		1.05	%
Net investment income^d		0.43	%		2.50	%		2.31	%

Supplemental data
Net assets, end of period (000’s)	$	4,469		$	2,617		$	250
Portfolio turnover rate		9.97	%		64.70	%		33.36	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.69% for the period ended June 30, 2015.

franklintempleton.com The accompanying notes are an integral part of these financial statements. | Semiannual Report | 75

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2020 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.12		$	10.93		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.06			0.42			0.11
Net realized and unrealized gains (losses)		0.19			0.08			0.93
Total from investment operations		0.25			0.50			1.04
Less distributions from:
Net investment income		(0.05	)		(0.25	)		(0.11	)
Net realized gains		(0.10	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.31	)		(0.11	)
Net asset value, end of period	$	11.22		$	11.12		$	10.93

Total return^f		2.24	%		4.61	%		10.48	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.66	%		2.45	%		11.45	%
Expenses net of waiver and payments by affiliates^h		0.55	%		0.55	%		0.55	%
Net investment income^d		0.93	%		3.00	%		2.81	%

Supplemental data
Net assets, end of period (000’s)	$	575		$	80		$	11
Portfolio turnover rate		9.97	%		64.70	%		33.36	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.69% for the period ended June 30, 2015.

76 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2020 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.15		$	10.95		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.08			0.45			0.14
Net realized and unrealized gains (losses)		0.20			0.11			0.94
Total from investment operations		0.28			0.56			1.08
Less distributions from:
Net investment income		(0.06	)		(0.30	)		(0.13	)
Net realized gains		(0.10	)		(0.06	)		(—)^e
Total distributions		(0.16	)		(0.36	)		(0.13	)
Net asset value, end of period	$	11.27		$	11.15		$	10.95

Total return^f		2.55	%		5.14	%		10.84	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.04	%		1.81	%		11.51	%
Expenses net of waiver and payments by affiliates^h		0.00	%		0.00	%		0.00	%
Net investment income^d		1.48	%		3.55	%		3.36	%

Supplemental data
Net assets, end of period (000’s)	$	7,325		$	7,361		$	11
Portfolio turnover rate		9.97	%		64.70	%		33.36	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.69% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2020 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.15		$	10.95		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.08			0.39			0.17
Net realized and unrealized gains (losses)		0.20			0.17			0.91
Total from investment operations		0.28			0.56			1.08
Less distributions from:
Net investment income		(0.06	)		(0.30	)		(0.13	)
Net realized gains		(0.10	)		(0.06	)		(—)^e
Total distributions		(0.16	)		(0.36	)		(0.13	)
Net asset value, end of period	$	11.27		$	11.15		$	10.95

Total return^f		2.53	%		5.08	%		10.83	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.16	%		1.95	%		10.95	%
Expenses net of waiver and payments by affiliates^h		0.05	%		0.05	%		0.05	%
Net investment income^d		1.43	%		3.50	%		3.31	%

Supplemental data
Net assets, end of period (000’s)	$	232		$	98		$	44
Portfolio turnover rate		9.97	%		64.70	%		33.36	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.69% for the period ended June 30, 2015.

78 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES


Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2020 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 97.2%
Alternative Strategies 6.5%
^aFranklin K2 Alternative Strategies Fund, Class R6	138,329	$	1,527,151
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	28,993		210,199
			1,737,350
Domestic Equity 37.7%
^a,bFranklin Biotechnology Discovery Fund, Class R6	1,228		252,459
^a,bFranklin DynaTech Fund, Class R6	25,836		1,308,310
^aFranklin Focused Core Equity Fund, Class R6	77,779		1,204,020
^aFranklin Growth Fund, Class R6	22,194		1,714,724
^a,bFranklin Growth Opportunities Fund, Class R6	25,668		913,772
^aFranklin Real Estate Securities Fund, Class R6	8,132		166,863
^aFranklin Rising Dividends Fund, Class R6	25,878		1,336,069
^a,bFranklin Small Cap Growth Fund, Class R6	20,870		441,409
^aFranklin Utilities Fund, Class R6	34,399		548,319
iShares Core S&P 500 ETF	7,896		1,636,209
iShares S&P 500 Value ETF	5,600		516,376
			10,038,530
Domestic Fixed Income 17.5%
^aFranklin Low Duration Total Return Fund, Class R6	288,636		2,892,134
^aFranklin Short Duration U.S. Government ETF	1,493		147,765
^aFranklin Strategic Income Fund, Class R6	105,063		1,033,820
iShares Intermediate Credit Bond ETF	5,239		570,318
			4,644,037
Foreign Equity 19.9%
^aFranklin International Growth Fund, Class R6	35,325		398,824
^aFranklin International Small Cap Growth Fund, Class R6	72,502		1,419,593
^aFranklin Mutual International Fund, Class R6	67,965		1,049,374
iShares Global Infrastructure ETF	5,902		239,798
iShares MSCI All Country Asia ex Japan ETF	4,696		295,848
^aTempleton China World Fund, Class R6	8,086		267,253
^aTempleton Foreign Fund, Class R6	74,763		539,041
^aTempleton Frontier Markets Fund, Class R6	29,559		412,647
WisdomTree Japan Hedged Equity Fund ETF (Japan)	11,916		681,595
			5,303,973
Foreign Fixed Income 15.6%
^aFranklin Emerging Market Debt Opportunities Fund	39,711		430,075
^aTempleton Global Total Return Fund, Class R6	302,594		3,718,883
			4,148,958
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $25,816,113)			25,872,848

franklintempleton.com

Semiannual Report | 79

FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2020 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $517,101) 1.9%
Money Market Funds 1.9%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	517,101	$	517,101
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $26,333,214) 99.1%			26,389,949
Other Assets, less Liabilities 0.9%			236,889
Net Assets 100.0%		$	26,626,838

See Abbreviations on page 165.

^aSee Note 3(f) regarding investments in Underlying Funds.
^bNon-income producing.

80 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com


								FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2025 Retirement Target Fund
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.36		$	12.76		$	11.11		$	10.22		$	10.70		$	9.54
Income from investment operations^a:
Net investment income^b,c		0.05			0.26			0.16			0.17			0.17			0.22
Net realized and unrealized gains (losses)		0.32			0.30			2.06			0.88			(0.48	)		1.13
Total from investment operations		0.37			0.56			2.22			1.05			(0.31	)		1.35
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.28	)		(0.19	)		(0.16	)		(0.17	)		(0.19	)
Net realized gains		(0.21	)		(0.68	)		(0.38	)		—			—			—
Total distributions		(0.22	)		(0.96	)		(0.57	)		(0.16	)		(0.17	)		(0.19	)
Net asset value, end of period	$	12.51		$	12.36		$	12.76		$	11.11		$	10.22		$	10.70

Total return^d		2.92	%		4.39	%		20.18	%		10.30	%		(2.86	)%		14.14	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		0.80	%		0.83	%		0.84	%		0.71	%		0.80	%		0.85	%
Expenses net of waiver and payments by
affiliates^f		0.35	%		0.35	%		0.38	%		0.45	%		0.45	%		0.45	%
Net investment income^c		0.78	%		2.03	%		1.31	%		1.55	%		1.64	%		2.25	%

Supplemental data
Net assets, end of period (000’s)	$	72,970		$	67,854		$	58,811		$	45,299		$	36,506		$	30,983
Portfolio turnover rate		4.01	%		62.00	%		47.39	%		25.67	%		20.06	%		19.11	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.70% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2025 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.18		$	12.60		$	10.97		$	10.11		$	10.59		$	9.45
Income from investment operations^a:
Net investment income^b,c		0.01			0.16			0.07			0.09			0.10			0.16
Net realized and unrealized gains (losses)		0.31			0.29			2.05			0.86			(0.48	)		1.11
Total from investment operations		0.32			0.45			2.12			0.95			(0.38	)		1.27
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.19	)		(0.11	)		(0.09	)		(0.10	)		(0.13	)
Net realized gains		(0.21	)		(0.68	)		(0.38	)		—			—			—
Total distributions		(0.22	)		(0.87	)		(0.49	)		(0.09	)		(0.10	)		(0.13	)
Net asset value, end of period	$	12.28		$	12.18		$	12.60		$	10.97		$	10.11		$	10.59

Total return^d		2.55	%		3.58	%		19.52	%		9.42	%		(3.54	)%		13.41	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		1.50	%		1.53	%		1.54	%		1.41	%		1.50	%		1.55	%
Expenses net of waiver and payments by
affiliates^f		1.05	%		1.05	%		1.08	%		1.15	%		1.15	%		1.15	%
Net investment income^c		0.08	%		1.33	%		0.61	%		0.85	%		0.94	%		1.55	%

Supplemental data
Net assets, end of period (000’s)	$	30,186		$	28,712		$	25,248		$	18,312		$	14,309		$	11,194
Portfolio turnover rate		4.01	%		62.00	%		47.39	%		25.67	%		20.06	%		19.11	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.70% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2025 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.31		$	12.72		$	11.07		$	10.19		$	10.68		$	9.53
Income from investment operations^a:
Net investment income^b,c		0.04			0.23			0.13			0.15			0.16			0.22
Net realized and unrealized gains (losses)		0.31			0.30			2.07			0.87			(0.50	)		1.10
Total from investment operations		0.35			0.53			2.20			1.02			(0.34	)		1.32
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.26	)		(0.17	)		(0.14	)		(0.15	)		(0.17	)
Net realized gains		(0.21	)		(0.68	)		(0.38	)		—			—			—
Total distributions		(0.22	)		(0.94	)		(0.55	)		(0.14	)		(0.15	)		(0.17	)
Net asset value, end of period	$	12.44		$	12.31		$	12.72		$	11.07		$	10.19		$	10.68

Total return^d		2.77	%		4.12	%		20.05	%		10.05	%		(3.14	)%		13.92	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		1.00	%		1.03	%		1.04	%		0.91	%		1.00	%		1.05	%
Expenses net of waiver and payments by
affiliates^f		0.55	%		0.55	%		0.58	%		0.65	%		0.65	%		0.65	%
Net investment income^c		0.58	%		1.83	%		1.11	%		1.35	%		1.44	%		2.05	%

Supplemental data
Net assets, end of period (000’s)	$	5,740		$	5,361		$	4,835		$	3,442		$	1,780		$	995
Portfolio turnover rate		4.01	%		62.00	%		47.39	%		25.67	%		20.06	%		19.11	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.70% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2025 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.39		$	12.79		$	11.74
Income from investment operations^b:
Net investment income^c,d		0.07			0.41			0.55
Net realized and unrealized gains (losses)		0.32			0.20			1.06
Total from investment operations		0.39			0.61			1.61
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(0.01	)		(0.33	)		(0.18	)
Net realized gains		(0.21	)		(0.68	)		(0.38	)
Total distributions		(0.22	)		(1.01	)		(0.56	)
Net asset value, end of period	$	12.56		$	12.39		$	12.79

Total return^e		3.08	%		4.74	%		13.90	%

Ratios to average net assets^f
Expenses before waiver and payments by affiliates^g		0.37	%		0.39	%		0.45	%
Expenses net of waiver and payments by affiliates^g		0.00	%		0.00	%		0.00	%
Net investment income^d		1.13	%		2.38	%		1.69	%

Supplemental data
Net assets, end of period (000’s)	$	14,535		$	14,010		$	2,339
Portfolio turnover rate		4.01	%		62.00	%		47.39	%

^aFor the period May 1, 2013 (effective date) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.70% for the period ended June 30, 2015.

84 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2025 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.38		$	12.79		$	11.12		$	10.23		$	10.72		$	9.55
Income from investment operations^a:
Net investment income^b,c		0.07			0.29			0.19			0.20			0.21			0.31
Net realized and unrealized gains (losses)		0.32			0.30			2.08			0.88			(0.50	)		1.07
Total from investment operations		0.39			0.59			2.27			1.08			(0.29	)		1.38
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.32	)		(0.22	)		(0.19	)		(0.20	)		(0.21	)
Net realized gains		(0.21	)		(0.68	)		(0.38	)		—			—			—
Total distributions		(0.22	)		(1.00	)		(0.60	)		(0.19	)		(0.20	)		(0.21	)
Net asset value, end of period	$	12.55		$	12.38		$	12.79		$	11.12		$	10.23		$	10.72

Total return^d		3.08	%		4.61	%		20.66	%		10.59	%		(2.65	)%		14.53	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		0.50	%		0.53	%		0.54	%		0.41	%		0.50	%		0.55	%
Expenses net of waiver and payments by
affiliates^f		0.05	%		0.05	%		0.08	%		0.15	%		0.15	%		0.15	%
Net investment income^c		1.08	%		2.33	%		1.61	%		1.85	%		1.94	%		2.55	%

Supplemental data
Net assets, end of period (000’s)	$	4,020		$	2,814		$	2,487		$	1,873		$	1,847		$	1,530
Portfolio turnover rate		4.01	%		62.00	%		47.39	%		25.67	%		20.06	%		19.11	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.70% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES




Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2025 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 98.4%
Alternative Strategies 6.8%
^aFranklin K2 Alternative Strategies Fund, Class R6	692,387	$	7,643,958
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	140,124		1,015,902
			8,659,860
Domestic Equity 46.5%
^a,bFranklin Biotechnology Discovery Fund, Class R6	9,457		1,944,431
^a,bFranklin DynaTech Fund, Class R6	154,430		7,820,345
^aFranklin Focused Core Equity Fund, Class R6	452,401		7,003,174
^aFranklin Growth Fund, Class R6	113,331		8,755,923
^a,bFranklin Growth Opportunities Fund, Class R6	141,086		5,022,668
^aFranklin Real Estate Securities Fund, Class R6	50,333		1,032,826
^aFranklin Rising Dividends Fund, Class R6	173,341		8,949,608
^a,bFranklin Small Cap Growth Fund, Class R6	152,782		3,231,334
^aFranklin Utilities Fund, Class R6	200,958		3,203,275
iShares Core S&P 500 ETF	36,814		7,628,597
iShares S&P 500 Value ETF	50,700		4,675,047
			59,267,228
Domestic Fixed Income 10.5%
^aFranklin Low Duration Total Return Fund, Class R6	808,362		8,099,783
^aFranklin Short Duration U.S. Government ETF	4,761		471,205
^aFranklin Strategic Income Fund, Class R6	292,219		2,875,431
iShares Intermediate Credit Bond ETF	17,162		1,868,256
			13,314,675
Foreign Equity 24.7%
^aFranklin International Growth Fund, Class R6	263,169		2,971,177
^aFranklin International Small Cap Growth Fund, Class R6	416,939		8,163,657
^aFranklin Mutual International Fund, Class R6	421,312		6,505,053
iShares Global Infrastructure ETF	47,199		1,917,695
iShares MSCI All Country Asia ex Japan ETF	25,440		1,602,720
^aTempleton China World Fund, Class R6	54,168		1,790,247
^aTempleton Foreign Fund, Class R6	390,801		2,817,673
^aTempleton Frontier Markets Fund, Class R6	171,254		2,390,706
WisdomTree Japan Hedged Equity Fund ETF (Japan)	57,665		3,298,438
			31,457,366
Foreign Fixed Income 9.9%
^aFranklin Emerging Market Debt Opportunities Fund	138,683		1,501,942
^aTempleton Global Total Return Fund, Class R6	908,978		11,171,342
			12,673,284
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $111,480,994)			125,372,413

86 | Semiannual Report

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FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2025 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $2,178,666) 1.7%
Money Market Funds 1.7%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	2,178,666	$	2,178,666
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $113,659,660) 100.1%			127,551,079
Other Assets, less Liabilities (0.1)%			(100,807	)
Net Assets 100.0%		$	127,450,272


FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2030 Retirement Target Fund
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.45		$	11.11		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.04			0.25			0.15
Net realized and unrealized gains (losses)		0.31			0.33			1.07
Total from investment operations		0.35			0.58			1.22
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.18	)		(0.11	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.24	)		(0.11	)
Net asset value, end of period	$	11.65		$	11.45		$	11.11

Total return^f		3.10	%		5.28	%		12.19	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.47	%		2.28	%		20.77	%
Expenses net of waiver and payments by affiliates^h		0.35	%		0.35	%		0.23	%
Net investment income^d		0.65	%		2.58	%		2.72	%

Supplemental data
Net assets, end of period (000’s)	$	9,923		$	5,098		$	1,260
Portfolio turnover rate		19.96	%		81.33	%		12.08	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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		FRANKLIN FUND ALLOCATOR SERIES
		FINANCIAL HIGHLIGHTS



Franklin LifeSmart 2030 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.38		$	11.09		$	10.00
Income from investment operations^b:
Net investment income (loss)^c,d		(—)^e			0.24			0.13
Net realized and unrealized gains (losses)		0.30			0.26			1.05
Total from investment operations		0.30			0.50			1.18
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.15	)		(0.09	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.21	)		(0.09	)
Net asset value, end of period	$	11.53		$	11.38		$	11.09

Total return^f		2.67	%		4.67	%		11.73	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		2.17	%		2.98	%		21.59	%
Expenses net of waiver and payments by affiliates^h		1.05	%		1.05	%		1.05	%
Net investment income (loss)^d		(0.05	)%		1.88	%		1.90	%

Supplemental data
Net assets, end of period (000’s)	$	2,946		$	1,950		$	132
Portfolio turnover rate		19.96	%		81.33	%		12.08	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2030 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.44		$	11.10		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.04			0.18			0.13
Net realized and unrealized gains (losses)		0.30			0.38			1.07
Total from investment operations		0.34			0.56			1.20
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.16	)		(0.10	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.22	)		(0.10	)
Net asset value, end of period	$	11.63		$	11.44		$	11.10

Total return^f		3.01	%		5.07	%		11.98	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.67	%		2.48	%		21.09	%
Expenses net of waiver and payments by affiliates^h		0.55	%		0.55	%		0.55	%
Net investment income^d		0.45	%		2.38	%		2.40	%

Supplemental data
Net assets, end of period (000’s)	$	805		$	48		$	47
Portfolio turnover rate		19.96	%		81.33	%		12.08	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

90 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2030 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.47		$	11.12		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.06			0.36			0.11
Net realized and unrealized gains (losses)		0.31			0.26			1.12
Total from investment operations		0.37			0.62			1.23
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.21	)		(0.11	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.27	)		(0.11	)
Net asset value, end of period	$	11.69		$	11.47		$	11.12

Total return^f		3.26	%		5.60	%		12.34	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		0.98	%		1.74	%		21.00	%
Expenses net of waiver and payments by affiliates^h		0.00	%		0.00	%		0.00	%
Net investment income^d		1.00	%		2.93	%		2.95	%

Supplemental data
Net assets, end of period (000’s)	$	12,724		$	12,041		$	11
Portfolio turnover rate		19.96	%		81.33	%		12.08	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2030 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.47		$	11.12		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.05			0.23			0.13
Net realized and unrealized gains (losses)		0.31			0.38			1.10
Total from investment operations		0.36			0.61			1.23
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.20	)		(0.11	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.26	)		(0.11	)
Net asset value, end of period	$	11.68		$	11.47		$	11.12

Total return^f		3.18	%		5.56	%		12.32	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.17	%		1.98	%		20.59	%
Expenses net of waiver and payments by affiliates^h		0.05	%		0.05	%		0.05	%
Net investment income^d		0.95	%		2.88	%		2.90	%

Supplemental data
Net assets, end of period (000’s)	$	108		$	101		$	82
Portfolio turnover rate		19.96	%		81.33	%		12.08	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

92 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES


Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2030 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 97.6%
Alternative Strategies 6.9%
^aFranklin K2 Alternative Strategies Fund, Class R6	142,848	$	1,577,058
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	32,965		238,993
			1,816,051
Domestic Equity 48.9%
^a,bFranklin Biotechnology Discovery Fund, Class R6	1,792		368,437
^a,bFranklin DynaTech Fund, Class R6	36,051		1,825,602
^aFranklin Focused Core Equity Fund, Class R6	96,316		1,490,978
^aFranklin Growth Fund, Class R6	28,183		2,177,409
^a,bFranklin Growth Opportunities Fund, Class R6	32,819		1,168,365
^aFranklin Real Estate Securities Fund, Class R6	11,732		240,745
^aFranklin Rising Dividends Fund, Class R6	36,615		1,890,407
^a,bFranklin Small Cap Growth Fund, Class R6	34,736		734,657
^aFranklin Utilities Fund, Class R6	45,471		724,807
iShares Core S&P 500 ETF	7,581		1,570,935
iShares S&P 500 Value ETF	8,200		756,122
			12,948,464
Domestic Fixed Income 7.7%
^aFranklin Low Duration Total Return Fund, Class R6	123,668		1,239,157
^aFranklin Short Duration U.S. Government ETF	641		63,441
^aFranklin Strategic Income Fund, Class R6	46,693		459,458
iShares Intermediate Credit Bond ETF	2,660		289,567
			2,051,623
Foreign Equity 27.0%
^aFranklin International Growth Fund, Class R6	59,386		670,468
^aFranklin International Small Cap Growth Fund, Class R6	97,552		1,910,063
^aFranklin Mutual International Fund, Class R6	90,365		1,395,229
iShares Global Infrastructure ETF	8,794		357,300
iShares MSCI All Country Asia ex Japan ETF	6,784		427,392
^aTempleton China World Fund, Class R6	13,283		439,007
^aTempleton Foreign Fund, Class R6	94,451		680,991
^aTempleton Frontier Markets Fund, Class R6	41,753		582,877
WisdomTree Japan Hedged Equity Fund, ETF (Japan)	12,259		701,215
			7,164,542
Foreign Fixed Income 7.1%
^aFranklin Emerging Market Debt Opportunities Fund	22,051		238,810
^aTempleton Global Total Return Fund, Class R6	134,111		1,648,218
			1,887,028
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $25,530,810)			25,867,708

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Semiannual Report | 93

FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2030 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $463,282) 1.7%
Money Market Funds 1.7%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	463,282	$	463,282
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $25,994,092) 99.3%			26,330,990
Other Assets, less Liabilities 0.7%			174,108
Net Assets 100.0%		$	26,505,098

See Abbreviations on page 165.

^aSee Note 3(f) regarding investments in Underlying Funds.
^bNon-income producing.

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								FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2035 Retirement Target Fund
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.67		$	12.85		$	11.01		$	10.13		$	10.59		$	9.36
Income from investment operations^a:
Net investment income^b,c		0.04			0.22			0.14			0.15			0.15			0.20
Net realized and unrealized gains (losses)		0.36			0.42			2.26			0.89			(0.46	)		1.18
Total from investment operations		0.40			0.64			2.40			1.04			(0.31	)		1.38
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.24	)		(0.15	)		(0.16	)		(0.15	)		(0.15	)
Net realized gains		(0.23	)		(0.58	)		(0.41	)		(—)^d			—			—
Total distributions		(0.24	)		(0.82	)		(0.56	)		(0.16	)		(0.15	)		(0.15	)
Net asset value, end of period	$	12.83		$	12.67		$	12.85		$	11.01		$	10.13		$	10.59

Total return^e		3.09	%		4.96	%		22.06	%		10.33	%		(2.97	)%		14.78	%

Ratios to average net assets^f
Expenses before waiver and payments by
affiliates^g		0.86	%		0.91	%		0.94	%		0.83	%		0.97	%		1.12	%
Expenses net of waiver and payments by
affiliates^g		0.35	%		0.35	%		0.38	%		0.45	%		0.45	%		0.45	%
Net investment income^c		0.55	%		1.76	%		1.17	%		1.45	%		1.44	%		2.06	%

Supplemental data
Net assets, end of period (000’s)	$	54,879		$	50,264		$	42,510		$	32,095		$	24,328		$	19,677
Portfolio turnover rate		4.66	%		61.73	%		49.84	%		27.30	%		29.19	%		23.28	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dAmount rounds to less than $0.01 per share.
^eTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2035 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.43		$	12.63		$	10.85		$	9.98		$	10.45		$	9.25
Income from investment operations^a:
Net investment income (loss)^b,c		(0.01	)		0.12			0.06			0.08			0.08			0.12
Net realized and unrealized gains (losses)		0.36			0.41			2.21			0.89			(0.47	)		1.18
Total from investment operations		0.35			0.53			2.27			0.97			(0.39	)		1.30
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.15	)		(0.08	)		(0.10	)		(0.08	)		(0.10	)
Net realized gains		(0.23	)		(0.58	)		(0.41	)		(—)^d			—			—
Total distributions		(0.24	)		(0.73	)		(0.49	)		(0.10	)		(0.08	)		(0.10	)
Net asset value, end of period	$	12.54		$	12.43		$	12.63		$	10.85		$	9.98		$	10.45

Total return^e		2.74	%		4.23	%		21.17	%		9.72	%		(3.70	)%		14.04	%

Ratios to average net assets^f
Expenses before waiver and payments by
affiliates^g		1.56	%		1.61	%		1.64	%		1.53	%		1.67	%		1.82	%
Expenses net of waiver and payments by
affiliates^g		1.05	%		1.05	%		1.08	%		1.15	%		1.15	%		1.15	%
Net investment income (loss)^c		(0.15	)%		1.06	%		0.47	%		0.75	%		0.74	%		1.36	%

Supplemental data
Net assets, end of period (000’s)	$	21,094		$	19,965		$	16,873		$	11,124		$	8,300		$	6,669
Portfolio turnover rate		4.66	%		61.73	%		49.84	%		27.30	%		29.19	%		23.28	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dAmount rounds to less than $0.01 per share.
^eTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2035 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.66		$	12.84		$	11.01		$	10.12		$	10.59		$	9.37
Income from investment operations^a:
Net investment income^b,c		0.02			0.19			0.11			0.14			0.14			0.21
Net realized and unrealized gains (losses)		0.37			0.42			2.26			0.89			(0.48	)		1.15
Total from investment operations		0.39			0.61			2.37			1.03			(0.34	)		1.36
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.21	)		(0.13	)		(0.14	)		(0.13	)		(0.14	)
Net realized gains		(0.23	)		(0.58	)		(0.41	)		(—)^d			—			—
Total distributions		(0.24	)		(0.79	)		(0.54	)		(0.14	)		(0.13	)		(0.14	)
Net asset value, end of period	$	12.81		$	12.66		$	12.84		$	11.01		$	10.12		$	10.59

Total return^e		3.01	%		4.75	%		21.77	%		10.24	%		(3.21	)%		14.55	%

Ratios to average net assets^f
Expenses before waiver and payments by
affiliates^g		1.06	%		1.11	%		1.14	%		1.03	%		1.17	%		1.32	%
Expenses net of waiver and payments by
affiliates^g		0.55	%		0.55	%		0.58	%		0.65	%		0.65	%		0.65	%
Net investment income^c		0.35	%		1.56	%		0.97	%		1.25	%		1.24	%		1.86	%

Supplemental data
Net assets, end of period (000’s)	$	5,174		$	4,577		$	4,093		$	3,035		$	1,724		$	1,038
Portfolio turnover rate		4.66	%		61.73	%		49.84	%		27.30	%		29.19	%		23.28	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dAmount rounds to less than $0.01 per share.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2035 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.75		$	12.92		$	11.77
Income from investment operations^b:
Net investment income^c,d		0.06			0.36			0.58
Net realized and unrealized gains (losses)		0.36			0.33			1.17
Total from investment operations		0.42			0.69			1.75
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(0.01	)		(0.28	)		(0.19	)
Net realized gains		(0.23	)		(0.58	)		(0.41	)
Total distributions		(0.24	)		(0.86	)		(0.60	)
Net asset value, end of period	$	12.93		$	12.75		$	12.92

Total return^e		3.22	%		5.35	%		15.09	%

Ratios to average net assets^f
Expenses before waiver and payments by affiliates^g		0.39	%		0.42	%		0.49	%
Expenses net of waiver and payments by affiliates^g		0.00	%		0.00	%		0.00	%
Net investment income^d		0.90	%		2.11	%		1.55	%

Supplemental data
Net assets, end of period (000’s)	$	18,037		$	16,262		$	2,532
Portfolio turnover rate		4.66	%		61.73	%		49.84	%

^aFor the period May 1, 2013 (effective date) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

98 | Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2035 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.75		$	12.93		$	11.07		$	10.17		$	10.63		$	9.39
Income from investment operations^a:
Net investment income^b,c		0.06			0.26			0.18			0.18			0.17			0.23
Net realized and unrealized gains (losses)		0.37			0.41			2.28			0.91			(0.46	)		1.19
Total from investment operations		0.43			0.67			2.46			1.09			(0.29	)		1.42
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.27	)		(0.19	)		(0.19	)		(0.17	)		(0.18	)
Net realized gains		(0.23	)		(0.58	)		(0.41	)		(—)^d			—			—
Total distributions		(0.24	)		(0.85	)		(0.60	)		(0.19	)		(0.17	)		(0.18	)
Net asset value, end of period	$	12.94		$	12.75		$	12.93		$	11.07		$	10.17		$	10.63

Total return^e		3.30	%		5.22	%		22.43	%		10.79	%		(2.69	)%		15.09	%

Ratios to average net assets^f
Expenses before waiver and payments by
affiliates^g		0.56	%		0.61	%		0.64	%		0.53	%		0.67	%		0.82	%
Expenses net of waiver and payments by
affiliates^g		0.05	%		0.05	%		0.08	%		0.15	%		0.15	%		0.15	%
Net investment income^c		0.85	%		2.06	%		1.47	%		1.75	%		1.74	%		2.36	%

Supplemental data
Net assets, end of period (000’s)	$	3,834		$	2,182		$	1,815		$	1,077		$	817		$	840
Portfolio turnover rate		4.66	%		61.73	%		49.84	%		27.30	%		29.19	%		23.28	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dAmount rounds to less than $0.01 per share.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.71% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES




Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2035 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 98.4%
Alternative Strategies 6.8%
^aFranklin K2 Alternative Strategies Fund, Class R6	563,739	$	6,223,680
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	112,156		813,129
			7,036,809
Domestic Equity 52.7%
^a,bFranklin Biotechnology Discovery Fund, Class R6	9,485		1,950,283
^a,bFranklin DynaTech Fund, Class R6	135,773		6,875,540
^aFranklin Focused Core Equity Fund, Class R6	419,774		6,498,102
^aFranklin Growth Fund, Class R6	107,077		8,272,772
^a,bFranklin Growth Opportunities Fund, Class R6	129,516		4,610,754
^aFranklin Real Estate Securities Fund, Class R6	47,514		974,994
^aFranklin Rising Dividends Fund, Class R6	166,592		8,601,164
^a,bFranklin Small Cap Growth Fund, Class R6	134,038		2,834,903
^aFranklin Utilities Fund, Class R6	198,933		3,170,999
iShares Core S&P 500 ETF	30,185		6,254,936
iShares S&P 500 Value ETF	45,300		4,177,113
			54,221,560
Domestic Fixed Income 5.8%
^aFranklin Low Duration Total Return Fund, Class R6	354,872		3,555,815
^aFranklin Short Duration U.S. Government ETF	2,216		219,322
^aFranklin Strategic Income Fund, Class R6	127,754		1,257,101
iShares Intermediate Credit Bond ETF	8,405		914,968
			5,947,206
Foreign Equity 27.7%
^aFranklin International Growth Fund, Class R6	231,290		2,611,261
^aFranklin International Small Cap Growth Fund, Class R6	379,482		7,430,258
^aFranklin Mutual International Fund, Class R6	379,925		5,866,046
iShares Global Infrastructure ETF	42,236		1,716,048
iShares MSCI All Country Asia ex Japan ETF	22,147		1,395,261
^aTempleton China World Fund, Class R6	50,485		1,668,515
^aTempleton Foreign Fund, Class R6	385,273		2,777,819
^aTempleton Frontier Markets Fund, Class R6	162,097		2,262,874
WisdomTree Japan Hedged Equity Fund ETF (Japan)	49,315		2,820,818
			28,548,900
Foreign Fixed Income 5.4%
^aFranklin Emerging Market Debt Opportunities Fund	64,834		702,156
^aTempleton Global Total Return Fund, Class R6	397,510		4,885,401
			5,587,557
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $89,321,270)			101,342,032

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FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2035 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $1,365,475) 1.3%
Money Market Funds 1.3%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	1,365,475	$	1,365,475
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $90,686,745) 99.7%			102,707,507
Other Assets, less Liabilities 0.3%			310,811
Net Assets 100.0%		$	103,018,318


FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2040 Retirement Target Fund
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.58		$	11.19		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.03			0.24			0.11
Net realized and unrealized gains (losses)		0.35			0.39			1.18
Total from investment operations		0.38			0.63			1.29
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.18	)		(0.10	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.24	)		(0.10	)
Net asset value, end of period	$	11.81		$	11.58		$	11.19

Total return^f		3.32	%		5.67	%		12.91	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.75	%		3.25	%		33.48	%
Expenses net of waiver and payments by affiliates^h		0.35	%		0.35	%		0.25	%
Net investment income^d		0.48	%		2.37	%		1.98	%

Supplemental data
Net assets, end of period (000’s)	$	6,231		$	2,891		$	672
Portfolio turnover rate		8.63	%		92.38	%		16.27	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

₁₀₂| Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2040 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.52		$	11.15		$	10.00
Income from investment operations^b:
Net investment income (loss)^c,d		(0.01	)		0.17			0.08
Net realized and unrealized gains (losses)		0.34			0.39			1.16
Total from investment operations		0.33			0.56			1.24
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.13	)		(0.09	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.19	)		(0.09	)
Net asset value, end of period	$	11.70		$	11.52		$	11.15

Total return^f		2.90	%		5.03	%		12.46	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		2.45	%		3.95	%		34.28	%
Expenses net of waiver and payments by affiliates^h		1.05	%		1.05	%		1.05	%
Net investment income (loss)^d		(0.22	)%		1.67	%		1.18	%

Supplemental data
Net assets, end of period (000’s)	$	1,259		$	747		$	60
Portfolio turnover rate		8.63	%		92.38	%		16.27	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2040 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.58		$	11.19		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.02			0.20			0.07
Net realized and unrealized gains (losses)		0.35			0.41			1.21
Total from investment operations		0.37			0.61			1.28
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.16	)		(0.09	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.22	)		(0.09	)
Net asset value, end of period	$	11.80		$	11.58		$	11.19

Total return^f		3.23	%		5.48	%		12.81	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.95	%		3.45	%		33.78	%
Expenses net of waiver and payments by affiliates^h		0.55	%		0.55	%		0.55	%
Net investment income^d		0.28	%		2.17	%		1.68	%

Supplemental data
Net assets, end of period (000’s)	$	631		$	37		$	11
Portfolio turnover rate		8.63	%		92.38	%		16.27	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2040 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.61		$	11.20		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.05			0.33			0.10
Net realized and unrealized gains (losses)		0.35			0.35			1.20
Total from investment operations		0.40			0.68			1.30
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.21	)		(0.10	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.27	)		(0.10	)
Net asset value, end of period	$	11.86		$	11.61		$	11.20

Total return^f		3.48	%		6.13	%		13.07	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.19	%		2.55	%		33.68	%
Expenses net of waiver and payments by affiliates^h		0.00	%		0.00	%		0.00	%
Net investment income^d		0.83	%		2.72	%		2.23	%

Supplemental data
Net assets, end of period (000’s)	$	11,346		$	10,154		$	11
Portfolio turnover rate		8.63	%		92.38	%		16.27	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2040 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.61		$	11.20		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.04			0.20			0.10
Net realized and unrealized gains (losses)		0.35			0.48			1.20
Total from investment operations		0.39			0.68			1.30
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.21	)		(0.10	)
Net realized gains		(0.15	)		(0.06	)		(—)^e
Total distributions		(0.15	)		(0.27	)		(0.10	)
Net asset value, end of period	$	11.85		$	11.61		$	11.20

Total return^f		3.39	%		6.08	%		13.04	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.45	%		2.95	%		33.28	%
Expenses net of waiver and payments by affiliates^h		0.05	%		0.05	%		0.05	%
Net investment income^d		0.78	%		2.67	%		2.18	%

Supplemental data
Net assets, end of period (000’s)	$	25		$	23		$	23
Portfolio turnover rate		8.63	%		92.38	%		16.27	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

₁₀₆| Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES


Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2040 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 98.6%
Alternative Strategies 6.9%
^aFranklin K2 Alternative Strategies Fund, Class R6	107,955	$	1,191,831
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	21,043		152,560
			1,344,391
Domestic Equity 54.9%
^a,bFranklin Biotechnology Discovery Fund, Class R6	1,584		325,694
^a,bFranklin DynaTech Fund, Class R6	29,602		1,499,065
^aFranklin Focused Core Equity Fund, Class R6	82,070		1,270,447
^aFranklin Growth Fund, Class R6	24,827		1,918,162
^a,bFranklin Growth Opportunities Fund, Class R6	25,785		917,944
^aFranklin Real Estate Securities Fund, Class R6	8,583		176,119
^aFranklin Rising Dividends Fund, Class R6	28,108		1,451,203
^a,bFranklin Small Cap Growth Fund, Class R6	25,940		548,625
^aFranklin Utilities Fund, Class R6	37,952		604,953
iShares Core S&P 500 ETF	5,614		1,163,333
iShares S&P 500 Value ETF	8,890		819,747
			10,695,292
Domestic Fixed Income 3.8%
^aFranklin Low Duration Total Return Fund, Class R6	45,300		453,904
^aFranklin Short Duration U.S. Government ETF	262		25,931
^aFranklin Strategic Income Fund, Class R6	16,154		158,960
iShares Intermediate Credit Bond ETF	928		101,022
			739,817
Foreign Equity 29.4%
^aFranklin International Growth Fund, Class R6	44,284		499,963
^aFranklin International Small Cap Growth Fund, Class R6	75,686		1,481,926
^aFranklin Mutual International Fund, Class R6	76,940		1,187,958
iShares Global Infrastructure ETF	6,842		277,990
iShares MSCI All Country Asia ex Japan ETF	4,832		304,416
^aTempleton China World Fund, Class R6	10,430		344,698
^aTempleton Foreign Fund, Class R6	76,799		553,722
^aTempleton Frontier Markets Fund, Class R6	33,370		465,841
WisdomTree Japan Hedged Equity Fund ETF (Japan)	10,812		618,446
			5,734,960
Foreign Fixed Income 3.6%
^aFranklin Emerging Market Debt Opportunities Fund	7,876		85,302
^aTempleton Global Total Return Fund, Class R6	50,323		618,464
			703,766
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $18,975,578)			19,218,226

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FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2040 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $277,533) 1.4%
Money Market Funds 1.4%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	277,533	$	277,533
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $19,253,111) 100.0%			19,495,759
Other Assets, less Liabilities (0.0)%^†			(4,450	)
Net Assets 100.0%		$	19,491,309

See Abbreviations on page 165.

^†Rounds to less than 0.1% of net assets.
^aSee Note 3(f) regarding investments in Underlying Funds.
^bNon-income producing.

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								FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2045 Retirement Target Fund
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.70		$	12.88		$	10.92		$	10.01		$	10.44		$	9.13
Income from investment operations^a:
Net investment income^b,c		0.03			0.20			0.13			0.15			0.15			0.16
Net realized and unrealized gains (losses)		0.37			0.43			2.36			0.91			(0.44	)		1.29
Total from investment operations		0.40			0.63			2.49			1.06			(0.29	)		1.45
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.22	)		(0.15	)		(0.15	)		(0.14	)		(0.14	)
Net realized gains		(0.24	)		(0.59	)		(0.38	)		—			—			—
Total distributions		(0.25	)		(0.81	)		(0.53	)		(0.15	)		(0.14	)		(0.14	)
Net asset value, end of period	$	12.85		$	12.70		$	12.88		$	10.92		$	10.01		$	10.44

Total return^d		3.11	%		4.94	%		23.07	%		10.61	%		(2.81	)%		15.92	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		1.04	%		1.11	%		1.16	%		1.05	%		1.30	%		1.56	%
Expenses net of waiver and payments by
affiliates^f		0.35	%		0.35	%		0.38	%		0.45	%		0.45	%		0.45	%
Net investment income^c		0.46	%		1.57	%		1.08	%		1.41	%		1.43	%		1.80	%

Supplemental data
Net assets, end of period (000’s)	$	38,256		$	34,259		$	27,991		$	20,765		$	14,762		$	10,090
Portfolio turnover rate		4.21	%		65.20	%		44.44	%		32.47	%		34.66	%		25.05	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2045 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.42		$	12.63		$	10.73		$	9.84		$	10.28		$	9.01
Income from investment operations^a:
Net investment income (loss)^b,c		(0.02	)		0.11			0.04			0.07			0.07			0.11
Net realized and unrealized gains (losses)		0.38			0.41			2.31			0.90			(0.43	)		1.25
Total from investment operations		0.36			0.52			2.35			0.97			(0.36	)		1.36
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.14	)		(0.07	)		(0.08	)		(0.08	)		(0.09	)
Net realized gains		(0.24	)		(0.59	)		(0.38	)		—			—			—
Total distributions		(0.25	)		(0.73	)		(0.45	)		(0.08	)		(0.08	)		(0.09	)
Net asset value, end of period	$	12.53		$	12.42		$	12.63		$	10.73		$	9.84		$	10.28

Total return^d		2.86	%		4.15	%		22.20	%		9.85	%		(3.54	)%		15.13	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		1.74	%		1.81	%		1.86	%		1.74	%		2.00	%		2.26	%
Expenses net of waiver and payments by
affiliates^f		1.05	%		1.05	%		1.08	%		1.14	%		1.15	%		1.15	%
Net investment income (loss)^c		(0.24	)%		0.87	%		0.38	%		0.72	%		0.73	%		1.10	%

Supplemental data
Net assets, end of period (000’s)	$	13,005		$	11,785		$	9,484		$	6,680		$	5,869		$	4,157
Portfolio turnover rate		4.21	%		65.20	%		44.44	%		32.47	%		34.66	%		25.05	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

₁₁₀| Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2045 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.66		$	12.82		$	10.88		$	9.99		$	10.42		$	9.12
Income from investment operations^a:
Net investment income^b,c		0.02			0.14			0.10			0.16			0.12			0.16
Net realized and unrealized gains (losses)		0.37			0.47			2.35			0.87			(0.43	)		1.27
Total from investment operations		0.39			0.61			2.45			1.03			(0.31	)		1.43
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.18	)		(0.13	)		(0.14	)		(0.12	)		(0.13	)
Net realized gains		(0.24	)		(0.59	)		(0.38	)		—			—			—
Total distributions		(0.25	)		(0.77	)		(0.51	)		(0.14	)		(0.12	)		(0.13	)
Net asset value, end of period	$	12.80		$	12.66		$	12.82		$	10.88		$	9.99		$	10.42

Total return^d		3.04	%		4.75	%		22.76	%		10.35	%		(3.01	)%		15.66	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		1.24	%		1.31	%		1.36	%		1.25	%		1.50	%		1.76	%
Expenses net of waiver and payments by
affiliates^f		0.55	%		0.55	%		0.58	%		0.65	%		0.65	%		0.65	%
Net investment income^c		0.26	%		1.37	%		0.88	%		1.21	%		1.23	%		1.60	%

Supplemental data
Net assets, end of period (000’s)	$	3,905		$	3,474		$	4,564		$	3,336		$	860		$	663
Portfolio turnover rate		4.21	%		65.20	%		44.44	%		32.47	%		34.66	%		25.05	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2045 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.77		$	12.95		$	11.67
Income from investment operations^b:
Net investment income^c,d		0.05			0.33			0.60
Net realized and unrealized gains (losses)		0.38			0.35			1.24
Total from investment operations		0.43			0.68			1.84
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(0.01	)		(0.27	)		(0.18	)
Net realized gains		(0.24	)		(0.59	)		(0.38	)
Total distributions		(0.25	)		(0.86	)		(0.56	)
Net asset value, end of period	$	12.95		$	12.77		$	12.95

Total return^e		3.33	%		5.24	%		16.08	%

Ratios to average net assets^f
Expenses before waiver and payments by affiliates^g		0.46	%		0.51	%		0.60	%
Expenses net of waiver and payments by affiliates^g		0.00	%		0.00	%		0.00	%
Net investment income^d		0.81	%		1.92	%		1.46	%

Supplemental data
Net assets, end of period (000’s)	$	10,053		$	8,987		$	1,718
Portfolio turnover rate		4.21	%		65.20	%		44.44	%

^aFor the period May 1, 2013 (effective date) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

₁₁₂| Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2045 Retirement Target Fund (continued)
		Six Months Ended
		June 30, 2015						Year Ended December 31,
		(unaudited)			2014			2013			2012			2011			2010
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	12.76		$	12.94		$	10.96		$	10.05		$	10.48		$	9.16
Income from investment operations^a:
Net investment income^b,c		0.05			0.24			0.17			0.16			0.17			0.25
Net realized and unrealized gains (losses)		0.38			0.43			2.37			0.93			(0.44	)		1.24
Total from investment operations		0.43			0.67			2.54			1.09			(0.27	)		1.49
Less distributions from:
Net investment income and short term gains
received from Underlying Funds		(0.01	)		(0.26	)		(0.18	)		(0.18	)		(0.16	)		(0.17	)
Net realized gains		(0.24	)		(0.59	)		(0.38	)		—			—			—
Total distributions		(0.25	)		(0.85	)		(0.56	)		(0.18	)		(0.16	)		(0.17	)
Net asset value, end of period	$	12.94		$	12.76		$	12.94		$	10.96		$	10.05		$	10.48

Total return^d		3.33	%		5.20	%		23.48	%		10.86	%		(2.55	)%		16.26	%

Ratios to average net assets^e
Expenses before waiver and payments by
affiliates^f		0.74	%		0.81	%		0.86	%		0.75	%		1.00	%		1.26	%
Expenses net of waiver and payments by
affiliates^f		0.05	%		0.05	%		0.08	%		0.15	%		0.15	%		0.15	%
Net investment income^c		0.76	%		1.87	%		1.38	%		1.71	%		1.73	%		2.10	%

Supplemental data
Net assets, end of period (000’s)	$	1,657		$	1,576		$	1,188		$	709		$	642		$	499
Portfolio turnover rate		4.21	%		65.20	%		44.44	%		32.47	%		34.66	%		25.05	%

^aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^bBased on average daily shares outstanding.
^cRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^dTotal return is not annualized for periods less than one year.
^eRatios are annualized for periods less than one year.
^fDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES




Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2045 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 98.7%
Alternative Strategies 6.8%
^aFranklin K2 Alternative Strategies Fund, Class R6	363,986	$	4,018,409
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	74,055		536,896
			4,555,305
Domestic Equity 54.1%
^a,bFranklin Biotechnology Discovery Fund, Class R6	5,924		1,218,107
^a,bFranklin DynaTech Fund, Class R6	98,856		5,006,088
^aFranklin Focused Core Equity Fund, Class R6	275,737		4,268,416
^aFranklin Growth Fund, Class R6	75,865		5,861,346
^a,bFranklin Growth Opportunities Fund, Class R6	69,876		2,487,573
^aFranklin Real Estate Securities Fund, Class R6	25,278		518,714
^aFranklin Rising Dividends Fund, Class R6	119,172		6,152,843
^a,bFranklin Small Cap Growth Fund, Class R6	89,532		1,893,600
^aFranklin Utilities Fund, Class R6	137,333		2,189,082
iShares Core S&P 500 ETF	19,394		4,018,825
iShares S&P 500 Value ETF	27,700		2,554,217
			36,168,811
Domestic Fixed Income 4.2%
^aFranklin Low Duration Total Return Fund, Class R6	170,414		1,707,544
^aFranklin Short Duration U.S. Government ETF	1,071		105,999
^aFranklin Strategic Income Fund, Class R6	58,188		572,569
iShares Intermediate Credit Bond ETF	3,720		404,959
			2,791,071
Foreign Equity 29.7%
^aFranklin International Growth Fund, Class R6	154,381		1,742,957
^aFranklin International Small Cap Growth Fund, Class R6	257,010		5,032,265
^aFranklin Mutual International Fund, Class R6	259,007		3,999,072
iShares Global Infrastructure ETF	29,875		1,213,821
iShares MSCI All Country Asia ex Japan ETF	15,512		977,256
^aTempleton China World Fund, Class R6	36,822		1,216,970
^aTempleton Foreign Fund, Class R6	316,320		2,280,669
^aTempleton Frontier Markets Fund, Class R6	107,583		1,501,855
WisdomTree Japan Hedged Equity Fund ETF (Japan)	33,495		1,915,914
			19,880,779
Foreign Fixed Income 3.9%
^aFranklin Emerging Market Debt Opportunities Fund	29,285		317,157
^aTempleton Global Total Return Fund, Class R6	184,757		2,270,665
			2,587,822
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $57,726,634)			65,983,788

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FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2045 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $610,014) 0.9%
Money Market Funds 0.9%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	610,014	$	610,014
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $58,336,648) 99.6%			66,593,802
Other Assets, less Liabilities 0.4%			281,683
Net Assets 100.0%		$	66,875,485


FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2050 Retirement Target Fund
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.62		$	11.21		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.03			0.22			0.10
Net realized and unrealized gains (losses)		0.35			0.43			1.21
Total from investment operations		0.38			0.65			1.31
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.18	)		(0.10	)
Net realized gains		(0.16	)		(0.06	)		—
Total distributions		(0.16	)		(0.24	)		(0.10	)
Net asset value, end of period	$	11.84		$	11.62		$	11.21

Total return^f		3.23	%		5.80	%		13.14	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		2.31	%		4.12	%		34.22	%
Expenses net of waiver and payments by affiliates^h		0.35	%		0.35	%		0.23	%
Net investment income^d		0.44	%		2.21	%		1.88	%

Supplemental data
Net assets, end of period (000’s)	$	4,282		$	2,318		$	512
Portfolio turnover rate		4.69	%		100.08	%		20.66	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2050 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.56		$	11.18		$	10.00
Income from investment operations^b:
Net investment income (loss)^c,d		(0.02	)		0.15			0.09
Net realized and unrealized gains (losses)		0.36			0.42			1.18
Total from investment operations		0.34			0.57			1.27
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.13	)		(0.09	)
Net realized gains		(0.16	)		(0.06	)		—
Total distributions		(0.16	)		(0.19	)		(0.09	)
Net asset value, end of period	$	11.74		$	11.56		$	11.18

Total return^f		2.91	%		5.03	%		12.82	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		3.01	%		4.82	%		35.04	%
Expenses net of waiver and payments by affiliates^h		1.05	%		1.05	%		1.05	%
Net investment income (loss)^d		(0.26	)%		1.51	%		1.06	%

Supplemental data
Net assets, end of period (000’s)	$	1,831		$	943		$	82
Portfolio turnover rate		4.69	%		100.08	%		20.66	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2050 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.63		$	11.21		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.02			0.18			0.06
Net realized and unrealized gains (losses)		0.35			0.45			1.24
Total from investment operations		0.37			0.63			1.30
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.15	)		(0.09	)
Net realized gains		(0.16	)		(0.06	)		—
Total distributions		(0.16	)		(0.21	)		(0.09	)
Net asset value, end of period	$	11.84		$	11.63		$	11.21

Total return^f		3.15	%		5.67	%		13.02	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		2.51	%		4.32	%		34.54	%
Expenses net of waiver and payments by affiliates^h		0.55	%		0.55	%		0.55	%
Net investment income^d		0.24	%		2.01	%		1.56	%

Supplemental data
Net assets, end of period (000’s)	$	664		$	33		$	11
Portfolio turnover rate		4.69	%		100.08	%		20.66	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2050 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.65		$	11.23		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.05			0.32			0.09
Net realized and unrealized gains (losses)		0.35			0.37			1.25
Total from investment operations		0.40			0.69			1.34
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.21	)		(0.11	)
Net realized gains		(0.16	)		(0.06	)		—
Total distributions		(0.16	)		(0.27	)		(0.11	)
Net asset value, end of period	$	11.89		$	11.65		$	11.23

Total return^f		3.40	%		6.16	%		13.39	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		1.51	%		3.22	%		34.36	%
Expenses net of waiver and payments by affiliates^h		0.00	%		0.00	%		0.00	%
Net investment income^d		0.79	%		2.56	%		2.11	%

Supplemental data
Net assets, end of period (000’s)	$	7,595		$	6,348		$	11
Portfolio turnover rate		4.69	%		100.08	%		20.66	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2050 Retirement Target Fund (continued)
		Six Months Ended			Year Ended
		June 30, 2015			December 31,
		(unaudited)			2014			2013	^a
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	11.65		$	11.22		$	10.00
Income from investment operations^b:
Net investment income^c,d		0.04			0.23			0.10
Net realized and unrealized gains (losses)		0.36			0.47			1.23
Total from investment operations		0.40			0.70			1.33
Less distributions from:
Net investment income and short term gains received from Underlying Funds		(—)^e			(0.21	)		(0.11	)
Net realized gains		(0.16	)		(0.06	)		—
Total distributions		(0.16	)		(0.27	)		(0.11	)
Net asset value, end of period	$	11.89		$	11.65		$	11.22

Total return^f		3.40	%		6.22	%		13.26	%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		2.01	%		3.82	%		34.04	%
Expenses net of waiver and payments by affiliates^h		0.05	%		0.05	%		0.05	%
Net investment income^d		0.74	%		2.51	%		2.06	%

Supplemental data
Net assets, end of period (000’s)	$	392		$	327		$	75
Portfolio turnover rate		4.69	%		100.08	%		20.66	%

^aFor the period July 1, 2013 (commencement of operations) to December 31, 2013.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.72% for the period ended June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES


Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2050 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 97.8%
Alternative Strategies 7.1%
^aFranklin K2 Alternative Strategies Fund, Class R6	83,465	$	921,460
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	17,195		124,667
			1,046,127
Domestic Equity 54.3%
^a,bFranklin Biotechnology Discovery Fund, Class R6	1,085		223,111
^a,bFranklin DynaTech Fund, Class R6	22,794		1,154,279
^aFranklin Focused Core Equity Fund, Class R6	63,537		983,547
^aFranklin Growth Fund, Class R6	20,418		1,577,479
^a,bFranklin Growth Opportunities Fund, Class R6	16,081		572,479
^aFranklin Real Estate Securities Fund, Class R6	5,674		116,431
^aFranklin Rising Dividends Fund, Class R6	22,719		1,172,994
^a,bFranklin Small Cap Growth Fund, Class R6	15,793		334,030
^aFranklin Utilities Fund, Class R6	29,771		474,553
iShares Core S&P 500 ETF	4,355		902,443
iShares S&P 500 Value ETF	5,485		505,772
			8,017,118
Domestic Fixed Income 3.7%
^aFranklin Low Duration Total Return Fund, Class R6	32,970		330,362
^aFranklin Short Duration U.S. Government ETF	232		22,961
^aFranklin Strategic Income Fund, Class R6	13,472		132,561
iShares Intermediate Credit Bond ETF	625		68,037
			553,921
Foreign Equity 29.4%
^aFranklin International Growth Fund, Class R6	26,834		302,956
^aFranklin International Small Cap Growth Fund, Class R6	58,144		1,138,451
^aFranklin Mutual International Fund, Class R6	59,094		912,415
iShares Global Infrastructure ETF	5,443		221,149
iShares MSCI All Country Asia ex Japan ETF	3,832		241,416
^aTempleton China World Fund, Class R6	5,938		196,238
^aTempleton Foreign Fund, Class R6	73,900		532,818
^aTempleton Frontier Markets Fund, Class R6	24,068		335,989
WisdomTree Japan Hedged Equity Fund ETF (Japan)	7,944		454,397
			4,335,829
Foreign Fixed Income 3.3%
^aFranklin Emerging Market Debt Opportunities Fund	5,636		61,035
^aTempleton Global Total Return Fund, Class R6	35,037		430,600
			491,635
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $14,182,616)			14,444,630

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FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2050 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $196,940) 1.4%
Money Market Funds 1.4%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	196,940	$	196,940
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $14,379,556) 99.2%			14,641,570
Other Assets, less Liabilities 0.8%			122,438
Net Assets 100.0%		$	14,764,008

See Abbreviations on page 165.

^aSee Note 3(f) regarding investments in Underlying Funds.
^bNon-income producing.

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		FRANKLIN FUND ALLOCATOR SERIES


Financial Highlights
Franklin LifeSmart 2055 Retirement Target Fund
		Period Ended
		June 30, 2015^a
		(unaudited)
Class A
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	10.00
Income from investment operations^b:
Net investment income^c,d		0.01
Net realized and unrealized gains (losses)		(0.12	)
Total from investment operations		(0.11	)
Less distributions from net investment income		(—)^e
Net asset value, end of period	$	9.89

Total return^f		(1.05	)%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		8.13	%ⁱ
Expenses net of waiver and payments by affiliates^h		0.35	%
Net investment income^d		0.82	%

Supplemental data
Net assets, end of period (000’s)	$	992
Portfolio turnover rate		4.92	%

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.74% for the period ended June 30, 2015.
ⁱRatios are adjusted to exclude the effects of annualization for non-recurring expenses.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2055 Retirement Target Fund (continued)
		Period Ended
		June 30, 2015^a
		(unaudited)
Class C
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	10.00
Income from investment operations^b:
Net investment income^c,d		—^e
Net realized and unrealized gains (losses)		(0.12	)
Total from investment operations		(0.12	)
Less distributions from net investment income		(—)^e
Net asset value, end of period	$	9.88

Total return^f		(1.16	)%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		8.83	%ⁱ
Expenses net of waiver and payments by affiliates^h		1.05	%
Net investment income^d		0.12	%

Supplemental data
Net assets, end of period (000’s)	$	33
Portfolio turnover rate		4.92	%

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.74% for the period ended June 30, 2015.
ⁱRatios are adjusted to exclude the effects of annualization for non-recurring expenses.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2055 Retirement Target Fund (continued)
		Period Ended
		June 30, 2015^a
		(unaudited)
Class R
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	10.00
Income from investment operations^b:
Net investment income^c,d		0.01
Net realized and unrealized gains (losses)		(0.12	)
Total from investment operations		(0.11	)
Less distributions from net investment income		(—)^e
Net asset value, end of period	$	9.89

Total return^f		(1.06	)%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		8.33	%ⁱ
Expenses net of waiver and payments by affiliates^h		0.55	%
Net investment income^d		0.62	%

Supplemental data
Net assets, end of period (000’s)	$	10
Portfolio turnover rate		4.92	%

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.74% for the period ended June 30, 2015.
ⁱRatios are adjusted to exclude the effects of annualization for non-recurring expenses.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2055 Retirement Target Fund (continued)
		Period Ended
		June 30, 2015^a
		(unaudited)
Class R6
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	10.00
Income from investment operations^b:
Net investment income^c,d		0.02
Net realized and unrealized gains (losses)		(0.12	)
Total from investment operations		(0.10	)
Less distributions from net investment income		(0.01	)
Net asset value, end of period	$	9.89

Total return^e		(1.05	)%

Ratios to average net assets^f
Expenses before waiver and payments by affiliates^g		7.33	%^h
Expenses net of waiver and payments by affiliates^g		0.00	%
Net investment income^d		1.17	%

Supplemental data
Net assets, end of period (000’s)	$	10
Portfolio turnover rate		4.92	%

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eTotal return is not annualized for periods less than one year.
^fRatios are annualized for periods less than one year.
^gDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.74% for the period ended June 30, 2015.
^hRatios are adjusted to exclude the effects of annualization for non-recurring expenses.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL HIGHLIGHTS


Franklin LifeSmart 2055 Retirement Target Fund (continued)
		Period Ended
		June 30, 2015^a
		(unaudited)
Advisor Class
Per share operating performance
(for a share outstanding throughout the period)
Net asset value, beginning of period	$	10.00
Income from investment operations^b:
Net investment income^c,d		0.02
Net realized and unrealized gains (losses)		(0.13	)
Total from investment operations		(0.11	)
Less distributions from net investment income		(—)^e
Net asset value, end of period	$	9.89

Total return^f		(1.05	)%

Ratios to average net assets^g
Expenses before waiver and payments by affiliates^h		7.83	%ⁱ
Expenses net of waiver and payments by affiliates^h		0.05	%
Net investment income^d		1.12	%

Supplemental data
Net assets, end of period (000’s)	$	11
Portfolio turnover rate		4.92	%

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.
^bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and
repurchases of the Fund’s shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
^cBased on average daily shares outstanding.
^dRecognition of net investment income by the Fund is affected by the timing of declaration of dividends by the Underlying Funds and exchange traded funds in which the
Fund invests.
^eAmount rounds to less than $0.01 per share.
^fTotal return is not annualized for periods less than one year.
^gRatios are annualized for periods less than one year.
^hDoes not include expenses of the Underlying Funds and exchange traded funds in which the Fund invests. The weighted average indirect expenses of the Underlying
Funds and exchange traded funds was 0.74% for the period ended June 30, 2015.
ⁱRatios are adjusted to exclude the effects of annualization for non-recurring expenses.

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FRANKLIN FUND ALLOCATOR SERIES




Statement of Investments, June 30, 2015 (unaudited)

Franklin LifeSmart 2055 Retirement Target Fund
	Shares/Units		Value
Investments in Underlying Funds and Exchange Traded Funds 94.8%
Alternative Strategies 6.4%
^aFranklin K2 Alternative Strategies Fund, Class R6	5,352	$	59,086
^a,bFranklin Pelagos Commodities Strategy Fund, Class R6	1,197		8,680
			67,766
Domestic Equity 53.0%
^a,bFranklin Biotechnology Discovery Fund, Class R6	75		15,400
^a,bFranklin DynaTech Fund, Class R6	1,598		80,937
^aFranklin Focused Core Equity Fund, Class R6	4,450		68,885
^aFranklin Growth Fund, Class R6	1,434		110,773
^a,bFranklin Growth Opportunities Fund, Class R6	1,124		39,997
^aFranklin Real Estate Securities Fund, Class R6	399		8,179
^aFranklin Rising Dividends Fund, Class R6	1,590		82,104
^a,bFranklin Small Cap Growth Fund, Class R6	1,111		23,492
^aFranklin Utilities Fund, Class R6	2,099		33,463
iShares Core S&P 500 ETF	286		59,265
iShares S&P 500 Value ETF	404		37,253
			559,748
Domestic Fixed Income 3.4%
^aFranklin Low Duration Total Return Fund, Class R6	2,056		20,601
^aFranklin Short Duration U.S. Government ETF	20		1,979
^aFranklin Strategic Income Fund, Class R6	841		8,274
iShares Intermediate Credit Bond ETF	48		5,225
			36,079
Foreign Equity 29.1%
^aFranklin International Growth Fund, Class R6	1,841		20,782
^aFranklin International Small Cap Growth Fund, Class R6	4,138		81,016
^aFranklin Mutual International Fund, Class R6	4,174		64,442
iShares Global Infrastructure ETF	392		15,927
iShares MSCI All Country Asia ex Japan ETF	231		14,553
^aTempleton China World Fund, Class R6	421		13,923
^aTempleton Foreign Fund, Class R6	5,237		37,761
^aTempleton Frontier Markets Fund, Class R6	1,699		23,722
WisdomTree Japan Hedged Equity Fund ETF (Japan)	626		35,807
			307,933
Foreign Fixed Income 2.9%
^aFranklin Emerging Market Debt Opportunities Fund	349		3,777
^aTempleton Global Total Return Fund, Class R6	2,193		26,947
			30,724
Total Investments in Underlying Funds and Exchange Traded Funds
before Short Term Investments (Cost $1,015,715)			1,002,250

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FRANKLIN FUND ALLOCATOR SERIES
STATEMENT OF INVESTMENTS (UNAUDITED)


Franklin LifeSmart 2055 Retirement Target Fund (continued)
	Shares/Units		Value
Short Term Investments (Cost $46,144) 4.4%
Money Market Funds 4.4%
^a,bInstitutional Fiduciary Trust Money Market Portfolio	46,144	$	46,144
Total Investments in Underlying Funds and Exchange Traded Funds
(Cost $1,061,859) 99.2%			1,048,394
Other Assets, less Liabilities 0.8%			8,324
Net Assets 100.0%		$	1,056,718


FRANKLIN FUND ALLOCATOR SERIES




Financial Statements

Statements of Assets and Liabilities
June 30, 2015 (unaudited)

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2015 Retirement			2020 Retirement			2025 Retirement
		Target Fund			Target Fund			Target Fund
Assets:
Cost - Underlying Funds (Note 3f)	$	67,351,013		$	22,492,570		$	94,624,612
Cost - Exchange traded funds		11,355,617			3,840,644			19,035,048
Total cost of investments	$	78,706,630		$	26,333,214		$	113,659,660
Value - Underlying Funds (Note 3f)	$	70,171,838		$	22,449,805		$	106,560,326
Value - Exchange traded funds		12,172,133			3,940,144			20,990,753
Total value of investments		82,343,971			26,389,949			127,551,079
Receivables:
Investment securities sold		141,186			32,580			76,027
Capital shares sold		571,594			237,027			347,905
Dividends		3,435			1,999			10,619
Affiliates		29,951			35,909			32,991
Other assets		34			8			51
Total assets		83,090,171			26,697,472			128,018,672
Liabilities:
Payables:
Investment securities purchased		148,556			29,711			89,134
Capital shares redeemed		102,702			4,648			341,320
Distribution fees		63,689			13,428			92,910
Transfer agent fees		9,102			553			16,376
Reports to shareholders		11,438			2,969			14,401
Professional fees		11,921			13,340			12,458
Registration and filing fees		—			5,534			—
Accrued expenses and other liabilities		1,860			451			1,801
Total liabilities		349,268			70,634			568,400
Net assets, at value	$	82,740,903		$	26,626,838		$	127,450,272
Net assets consist of:
Paid-in capital	$	79,222,518		$	26,640,577		$	113,023,944
Undistributed net investment income		70,381			22,916			406,419
Net unrealized appreciation (depreciation)		3,637,341			56,735			13,891,419
Accumulated net realized gain (loss)		(189,337	)		(93,390	)		128,490
Net assets, at value	$	82,740,903		$	26,626,838		$	127,450,272

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		FRANKLIN FUND ALLOCATOR SERIES
				FINANCIAL STATEMENTS


Statements of Assets and Liabilities (continued)
June 30, 2015 (unaudited)

		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2015 Retirement		2020 Retirement		2025 Retirement
		Target Fund		Target Fund		Target Fund
Class A:
Net assets, at value	$	48,272,284	$	14,025,580	$	72,969,892
Shares outstanding		4,161,865		1,247,018		5,835,049
Net asset value per share^a	$	11.60	$	11.25	$	12.51
Maximum offering price per share (net asset value
per share ÷ 94.25%)	$	12.31	$	11.94	$	13.27
Class C:
Net assets, at value	$	21,998,837	$	4,468,958	$	30,186,491
Shares outstanding		1,917,388		399,524		2,458,444
Net asset value and maximum offering price per share^a	$	11.47	$	11.19	$	12.28
Class R:
Net assets, at value	$	3,790,504	$	574,857	$	5,739,533
Shares outstanding		327,928		51,217		461,217
Net asset value and maximum offering price per share	$	11.56	$	11.22	$	12.44
Class R6:
Net assets, at value	$	5,766,502	$	7,325,036	$	14,534,763
Shares outstanding		495,065		649,842		1,157,376
Net asset value and maximum offering price per share	$	11.65	$	11.27	$	12.56
Advisor Class:
Net assets, at value	$	2,912,776	$	232,407	$	4,019,593
Shares outstanding		250,266		20,621		320,312
Net asset value and maximum offering price per share	$	11.64	$	11.27	$	12.55


^aRedemption price is equal to net asset value less contingent deferred sales charges, if applicable.
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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL STATEMENTS


Statements of Assets and Liabilities (continued)
June 30, 2015 (unaudited)

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2030 Retirement			2035 Retirement			2040 Retirement
		Target Fund			Target Fund			Target Fund
Assets:
Cost - Underlying Funds (Note 3f)	$	22,043,616		$	74,983,493		$	16,052,275
Cost - Exchange traded funds		3,950,476			15,703,252			3,200,836
Total cost of investments	$	25,994,092		$	90,686,745		$	19,253,111
Value - Underlying Funds (Note 3f)	$	22,228,459		$	85,428,363		$	16,210,805
Value - Exchange traded funds		4,102,531			17,279,144			3,284,954
Total value of investments		26,330,990			102,707,507			19,495,759
Receivables:
Investment securities sold		10,876			54,292			—
Capital shares sold		169,357			430,878			161,237
Dividends		2,721			8,906			1,950
Affiliates		35,366			31,254			32,698
Other assets		8			40			6
Total assets		26,549,318			103,232,877			19,691,650
Liabilities:
Payables:
Investment securities purchased		9,908			39,613			—
Capital shares redeemed		6,198			70,403			176,354
Distribution fees		9,886			68,682			5,549
Transfer agent fees		—			12,232			273
Reports to shareholders		13			10,209			—
Professional fees		12,678			11,678			12,523
Registration and filing fees		5,454			—			5,465
Accrued expenses and other liabilities		83			1,742			177
Total liabilities		44,220			214,559			200,341
Net assets, at value	$	26,505,098		$	103,018,318		$	19,491,309
Net assets consist of:
Paid-in capital	$	26,280,557		$	90,865,713		$	19,230,143
Undistributed net investment income		86,464			229,872			56,026
Net unrealized appreciation (depreciation)		336,898			12,020,762			242,648
Accumulated net realized gain (loss)		(198,821	)		(98,029	)		(37,508	)
Net assets, at value	$	26,505,098		$	103,018,318		$	19,491,309

₁₃₂| Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com


		FRANKLIN FUND ALLOCATOR SERIES
				FINANCIAL STATEMENTS


Statements of Assets and Liabilities (continued)
June 30, 2015 (unaudited)

		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2030 Retirement		2035 Retirement		2040 Retirement
		Target Fund		Target Fund		Target Fund
Class A:
Net assets, at value	$	9,922,792	$	54,879,305	$	6,231,095
Shares outstanding		851,942		4,276,678		527,634
Net asset value per share^a	$	11.65	$	12.83	$	11.81
Maximum offering price per share (net asset value
per share ÷ 94.25%)	$	12.36	$	13.61	$	12.53
Class C:
Net assets, at value	$	2,945,639	$	21,093,936	$	1,258,686
Shares outstanding		255,432		1,682,644		107,558
Net asset value and maximum offering price per share^a	$	11.53	$	12.54	$	11.70
Class R:
Net assets, at value	$	804,940	$	5,173,642	$	630,749
Shares outstanding		69,238		404,002		53,458
Net asset value and maximum offering price per share	$	11.63	$	12.81	$	11.80
Class R6:
Net assets, at value	$	12,723,591	$	18,036,986	$	11,345,522
Shares outstanding		1,088,288		1,394,848		957,005
Net asset value and maximum offering price per share	$	11.69	$	12.93	$	11.86
Advisor Class:
Net assets, at value	$	108,136	$	3,834,449	$	25,257
Shares outstanding		9,256		296,425		2,131
Net asset value and maximum offering price per share	$	11.68	$	12.94	$	11.85

^aRedemption price is equal to net asset value less contingent deferred sales charges, if applicable.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL STATEMENTS


Statements of Assets and Liabilities (continued)
June 30, 2015 (unaudited)

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2045 Retirement			2050 Retirement			2055 Retirement
		Target Fund			Target Fund			Target Fund
Assets:
Cost - Underlying Funds (Note 3f)	$	48,309,141		$	12,064,140		$	892,361
Cost - Exchange traded funds		10,027,507			2,315,416			169,498
Total cost of investments	$	58,336,648		$	14,379,556		$	1,061,859
Value - Underlying Funds (Note 3f)	$	55,508,810		$	12,248,356		$	880,364
Value - Exchange traded funds		11,084,992			2,393,214			168,030
Total value of investments		66,593,802			14,641,570			1,048,394
Cash		—			—			460
Receivables:
Investment securities sold		10,868			10,836			—
Capital shares sold		335,184			111,353			19,690
Dividends		6,361			1,550			61
Affiliates		48,296			33,758			14,738
Other assets		26			6			—
Total assets		66,994,537			14,799,073			1,083,343
Liabilities:
Payables:
Investment securities purchased		9,902			9,908			—
Capital shares redeemed		31,067			228			—
Distribution fees		44,471			5,920			505
Transfer agent fees		10,954			—			59
Reports to shareholders		9,262			449			2,364
Professional fees		11,787			12,701			6,114
Registration and filing fees		—			5,463			—
Offering costs		—			—			17,380
Accrued expenses and other liabilities		1,609			396			203
Total liabilities		119,052			35,065			26,625
Net assets, at value	$	66,875,485		$	14,764,008		$	1,056,718
Net assets consist of:
Paid-in capital	$	58,505,366		$	14,525,222		$	1,068,443
Undistributed net investment income		118,824			34,712			923
Net unrealized appreciation (depreciation)		8,257,154			262,014			(13,465	)
Accumulated net realized gain (loss)		(5,859	)		(57,940	)		817
Net assets, at value	$	66,875,485		$	14,764,008		$	1,056,718

₁₃₄| Semiannual Report | The accompanying notes are an integral part of these financial statements. franklintempleton.com


		FRANKLIN FUND ALLOCATOR SERIES
				FINANCIAL STATEMENTS


Statements of Assets and Liabilities (continued)
June 30, 2015 (unaudited)

		Franklin		Franklin			Franklin
		LifeSmart		LifeSmart	LifeSmart
		2045 Retirement		2050 Retirement	2055 Retirement
		Target Fund		Target Fund	Target Fund
Class A:
Net assets, at value	$	38,255,955	$	4,282,021	$		992,201
Shares outstanding		2,975,979		361,588			100,329
Net asset value per share^a	$	12.85	$	11.84		$	9.89
Maximum offering price per share (net asset value
per share ÷ 94.25%)	$	13.63	$	12.56		$	10.49
Class C:
Net assets, at value	$	13,004,633	$	1,830,644	$		33,286
Shares outstanding		1,038,156		155,938			3,370
Net asset value and maximum offering price per share^a	$	12.53	$	11.74		$	9.88
Class R:
Net assets, at value	$	3,905,091	$	664,403	$		9,885
Shares outstanding		305,040		56,137			1,000
Net asset value and maximum offering price per share	$	12.80	$	11.84		$	9.89
Class R6:
Net assets, at value	$	10,052,967	$	7,594,550	$		9,895
Shares outstanding		776,174		638,561			1,000
Net asset value and maximum offering price per share	$	12.95	$	11.89		$	9.89	^b
Advisor Class:
Net assets, at value	$	1,656,839	$	392,390	$		11,451
Shares outstanding		128,016		32,995			1,157
Net asset value and maximum offering price per share	$	12.94	$	11.89		$	9.89	^b

^aRedemption price is equal to net asset value less contingent deferred sales charges, if applicable.
^bNet asset value and maximum offering price may not recalculate due to rounding of net assets and/or shares outstanding.

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL STATEMENTS

Statements of Operations
for the six months ended June 30, 2015 (unaudited)


		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2015 Retirement			2020 Retirement			2025 Retirement
		Target Fund			Target Fund			Target Fund
Investment income:
Dividends:
Underlying Funds (Note 3f)	$	683,912		$	122,945		$	492,491
Exchange traded funds		126,653			34,301			210,131
Total investment income		810,565			157,246			702,622
Expenses:
Asset allocation fees (Note 3a)		101,466			26,546			155,581
Distribution fees: (Note 3c)
Class A		72,699			14,843			106,804
Class C		107,380			16,513			146,932
Class R		8,065			673			13,879
Transfer agent fees: (Note 3e)
Class A		26,682			5,724			47,495
Class C		12,101			1,890			19,749
Class R		1,794			154			3,703
Class R6		80			90			100
Advisor Class		1,241			119			2,396
Custodian fees (Note 4)		38			10			88
Reports to shareholders		10,930			1,841			15,452
Registration and filing fees		43,193			68,788			43,267
Professional fees		12,410			13,522			13,089
Trustees’ fees and expenses		278			—			383
Other		2,023			508			2,148
Total expenses		400,380			151,221			571,066
Expense reductions (Note 4)		—			(9	)		—
Expenses waived/paid by affiliates (Notes 3f and 3g)		(193,454	)		(115,735	)		(275,965	)
Net expenses		206,926			35,477			295,101
Net investment income		603,639			121,769			407,521
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Sale of investments:
Underlying Funds (Note 3f)		87,782			(44,945	)		336,650
Exchange traded funds		5,307			16,077			(857	)
Net realized gain (loss)		93,089			(28,868	)		335,793
Net change in unrealized appreciation (depreciation) on investments		511,802			267,070			2,623,032
Net realized and unrealized gain (loss)		604,891			238,202			2,958,825
Net increase (decrease) in net assets resulting from operations	$	1,208,530		$	359,971		$	3,366,346

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		FRANKLIN FUND ALLOCATOR SERIES
					FINANCIAL STATEMENTS


Statements of Operations (continued)
for the six months ended June 30, 2015 (unaudited)

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2030 Retirement			2035 Retirement			2040 Retirement
		Target Fund			Target Fund			Target Fund
Investment income:
Dividends:
Underlying Funds (Note 3f)	$	74,540		$	277,711		$	41,702
Exchange traded funds		38,368			170,290			29,247
Total investment income		112,908			448,001			70,949
Expenses:
Asset allocation fees (Note 3a)		28,248			124,406			21,329
Distribution fees: (Note 3c)
Class A		11,002			80,037			7,114
Class C		11,874			104,611			4,992
Class R		890			12,642			1,169
Transfer agent fees: (Note 3e)
Class A		6,809			45,118			6,080
Class C		2,211			17,693			1,282
Class R		331			4,276			600
Class R6		78			71			98
Advisor Class		98			2,568			32
Custodian fees (Note 4)		28			69			8
Reports to shareholders		2,612			13,796			2,324
Registration and filing fees		67,152			41,127			64,914
Professional fees		13,107			12,371			13,025
Trustees’ fees and expenses		—			293			—
Other		198			2,067			494
Total expenses		144,638			461,145			123,461
Expense reductions (Note 4)		(8	)		—			(6	)
Expenses waived/paid by affiliates (Notes 3f and 3g)		(118,321	)		(243,257	)		(108,619	)
Net expenses		26,309			217,888			14,836
Net investment income		86,599			230,113			56,113
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Sale of investments:
Underlying Funds (Note 3f)		(111,257	)		201,493			(8,916	)
Exchange traded funds		2,042			(119	)		10,990
Net realized gain (loss)		(109,215	)		201,374			2,074
Net change in unrealized appreciation (depreciation) on investments		580,025			2,453,149			420,970
Net realized and unrealized gain (loss)		470,810			2,654,523			423,044
Net increase (decrease) in net assets resulting from operations	$	557,409		$	2,884,636		$	479,157

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL STATEMENTS


Statements of Operations (continued)
for the six months ended June 30, 2015 (unaudited)

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2045 Retirement			2050 Retirement			2055 Retirement
		Target Fund			Target Fund			Target Fund^a
Investment income:
Dividends:
Underlying Funds (Note 3f)	$	150,646		$	29,008		$	930
Exchange traded funds		108,413			21,562			1,057
Total investment income		259,059			50,570			1,987
Expenses:
Asset allocation fees (Note 3a)		80,126			16,052			417
Distribution fees: (Note 3c)
Class A		55,163			4,632			480
Class C		61,769			8,705			17
Class R		9,356			1,080			8
Transfer agent fees: (Note 3e)
Class A		51,287			7,722			805
Class C		17,319			4,357			8
Class R		5,217			1,082			8
Class R6		86			91			—
Advisor Class		2,273			920			9
Custodian fees (Note 4)		43			6			—
Reports to shareholders		12,806			2,760			2,364
Registration and filing fees		40,218			64,994			416
Professional fees		12,991			13,087			6,114
Trustees’ fees and expenses		98			—			—
Amortization of offering costs (Note 1d)		—			—			17,380
Other		1,947			513			213
Total expenses		350,699			126,001			28,239
Expenses waived/paid by affiliates (Notes 3f and 3g)		(210,768	)		(110,154	)		(27,651	)
Net expenses		139,931			15,847			588
Net investment income		119,128			34,723			1,399
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Sale of investments:
Underlying Funds (Note 3f)		194,449			1,378			(4	)
Exchange traded funds		656			(614	)		821
Net realized gain (loss)		195,105			764			817
Net change in unrealized appreciation (depreciation) on investments		1,581,300			323,349			(13,465	)
Net realized and unrealized gain (loss)		1,776,405			324,113			(12,648	)
Net increase (decrease) in net assets resulting from operations	$	1,895,533		$	358,836		$	(11,249	)

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.

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					FRANKLIN FUND ALLOCATOR SERIES
								FINANCIAL STATEMENTS


Statements of Changes in Net Assets

		Franklin LifeSmart						Franklin LifeSmart
		2015 Retirement Target Fund						2020 Retirement Target Fund
		Six Months Ended						Six Months Ended
		June 30, 2015			Year Ended			June 30, 2015			Year Ended
		(unaudited)			December 31, 2014			(unaudited)			December 31, 2014
Increase (decrease) in net assets:
Operations:
Net investment income	$	603,639		$	2,327,715		$	121,769		$	314,434
Net realized gain (loss)		93,089			4,250,438			(28,868	)		223,246
Net change in unrealized appreciation
(depreciation)		511,802			(4,540,828	)		267,070			(308,049	)
Net increase (decrease) in net assets
resulting from operations		1,208,530			2,037,325			359,971			229,631
Distributions to shareholders from:
Net investment income:
Class A		(388,234	)		(1,534,945	)		(51,751	)		(154,362	)
Class C		(110,396	)		(544,147	)		(6,415	)		(46,024	)
Class R		(26,447	)		(87,705	)		(1,935	)		(1,539	)
Class R6		(55,996	)		(183,415	)		(40,694	)		(148,729	)
Advisor Class		(24,726	)		(78,086	)		(1,229	)		(2,386	)
Net realized gains:
Class A		(669,801	)		(2,272,543	)		(126,473	)		(23,052	)
Class C		(307,879	)		(1,021,897	)		(40,392	)		(9,327	)
Class R		(52,509	)		(139,550	)		(5,233	)		(96	)
Class R6		(79,617	)		(252,497	)		(66,359	)		(85	)
Advisor Class		(40,154	)		(106,864	)		(2,112	)		(99	)
Total distributions to shareholders		(1,755,759	)		(6,221,649	)		(342,593	)		(385,699	)
Capital share transactions: (Note 2)
Class A		460,835			6,170,569			6,784,664			5,113,177
Class C		955,926			1,876,090			1,858,413			2,358,837
Class R		996,959			693,679			502,166			70,138
Class R6		(920,606	)		6,393,005			(126,508	)		7,507,430
Advisor Class		753,576			(185,970	)		132,719			59,654
Total capital share transactions		2,246,690			14,947,373			9,151,454			15,109,236
Net increase (decrease) in net
assets		1,699,461			10,763,049			9,168,832			14,953,168
Net assets:
Beginning of period		81,041,442			70,278,393			17,458,006			2,504,838
End of period	$	82,740,903		$	81,041,442		$	26,626,838		$	17,458,006
Undistributed net investment income included
in net assets:
End of period	$	70,381		$	72,541		$	22,916		$	3,171

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL STATEMENTS


Statements of Changes in Net Assets (continued)

		Franklin LifeSmart						Franklin LifeSmart
		2025 Retirement Target Fund						2030 Retirement Target Fund
		Six Months Ended						Six Months Ended
		June 30, 2015			Year Ended			June 30, 2015			Year Ended
		(unaudited)			December 31, 2014			(unaudited)			December 31, 2014
Increase (decrease) in net assets:
Operations:
Net investment income	$	407,521		$	1,991,177		$	86,599		$	269,376
Net realized gain (loss)		335,793			6,825,214			(109,215	)		324,712
Net change in unrealized appreciation
(depreciation)		2,623,032			(4,675,189	)		580,025			(297,002	)
Net increase (decrease) in net assets
resulting from operations		3,366,346			4,141,202			557,409			297,086
Distributions to shareholders from:
Net investment income:
Class A		(42,988	)		(1,441,714	)		(2,305	)		(78,129	)
Class C		(17,825	)		(434,794	)		(769	)		(25,790	)
Class R		(3,291	)		(105,712	)		(93	)		(654	)
Class R6		(8,697	)		(250,682	)		(4,005	)		(215,145	)
Advisor Class		(2,236	)		(68,643	)		(34	)		(1,769	)
Net realized gains:
Class A		(1,185,389	)		(3,469,793	)		(128,435	)		(18,775	)
Class C		(499,370	)		(1,505,335	)		(38,391	)		(5,210	)
Class R		(93,666	)		(279,799	)		(10,438	)		(156	)
Class R6		(238,783	)		(484,097	)		(164,477	)		(7,475	)
Advisor Class		(64,883	)		(146,176	)		(1,397	)		(495	)
Total distributions to shareholders		(2,157,128	)		(8,186,745	)		(350,344	)		(353,598	)
Capital share transactions: (Note 2)
Class A		4,378,653			11,229,371			4,837,969			3,759,369
Class C		1,267,468			4,410,269			990,224			1,816,743
Class R		325,924			694,943			774,074			—
Class R6		335,618			12,323,031			452,090			12,169,466
Advisor Class		1,181,669			419,109			5,330			16,324
Total capital share transactions		7,489,332			29,076,723			7,059,687			17,761,902
Net increase (decrease) in net
assets		8,698,550			25,031,180			7,266,752			17,705,390
Net assets:
Beginning of period		118,751,722			93,720,542			19,238,346			1,532,956
End of period	$	127,450,272		$	118,751,722		$	26,505,098		$	19,238,346
Undistributed net investment income included
in net assets:
End of period	$	406,419		$	73,935		$	86,464		$	7,071

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					FRANKLIN FUND ALLOCATOR SERIES
								FINANCIAL STATEMENTS


Statements of Changes in Net Assets (continued)

		Franklin LifeSmart						Franklin LifeSmart
		2035 Retirement Target Fund						2040 Retirement Target Fund
		Six Months Ended						Six Months Ended
		June 30, 2015			Year Ended			June 30, 2015			Year Ended
		(unaudited)			December 31, 2014			(unaudited)			December 31, 2014
Increase (decrease) in net assets:
Operations:
Net investment income	$	230,113		$	1,315,548		$	56,113		$	165,052
Net realized gain (loss)		201,374			4,614,128			2,074			257,493
Net change in unrealized appreciation
(depreciation)		2,453,149			(2,514,544	)		420,970			(215,383	)
Net increase (decrease) in net assets
resulting from operations		2,884,636			3,415,132			479,157			207,162
Distributions to shareholders from:
Net investment income and short term
gains received from Underlying Funds:
Class A		(32,417	)		(895,972	)		(658	)		(42,238	)
Class C		(13,035	)		(236,163	)		(150	)		(7,930	)
Class R		(3,108	)		(72,060	)		(85	)		(489	)
Class R6		(10,151	)		(338,158	)		(1,538	)		(152,975	)
Advisor Class		(1,789	)		(44,614	)		(4	)		(417	)
Net realized gains:
Class A		(951,109	)		(2,136,291	)		(82,422	)		(7,502	)
Class C		(373,616	)		(871,981	)		(16,073	)		(2,598	)
Class R		(90,233	)		(200,136	)		(8,186	)		(117	)
Class R6		(310,339	)		(483,256	)		(146,303	)		(1,609	)
Advisor Class		(65,833	)		(93,256	)		(328	)		(115	)
Total distributions to shareholders		(1,851,630	)		(5,371,887	)		(255,747	)		(215,990	)
Capital share transactions: (Note 2)
Class A		4,025,123			8,560,687			3,333,340			2,184,069
Class C		959,207			3,455,375			508,439			677,225
Class R		525,805			562,243			593,941			25,470
Class R6		1,568,097			14,399,417			978,599			10,197,181
Advisor Class		1,657,477			405,419			1,422			(535	)
Total capital share transactions		8,735,709			27,383,141			5,415,741			13,083,410
Net increase (decrease) in net
assets		9,768,715			25,426,386			5,639,151			13,074,582
Net assets:
Beginning of period		93,249,603			67,823,217			13,852,158			777,576
End of period	$	103,018,318		$	93,249,603		$	19,491,309		$	13,852,158
Undistributed net investment income included
in net assets:
End of period	$	229,872		$	60,259		$	56,026		$	2,348

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FRANKLIN FUND ALLOCATOR SERIES
FINANCIAL STATEMENTS


Statements of Changes in Net Assets (continued)

		Franklin LifeSmart						Franklin LifeSmart
		2045 Retirement Target Fund						2050 Retirement Target Fund
		Six Months Ended						Six Months Ended
		June 30, 2015			Year Ended			June 30, 2015			Year Ended
		(unaudited)			December 31, 2014			(unaudited)			December 31, 2014
Increase (decrease) in net assets:
Operations:
Net investment income	$	119,128		$	771,302		$	34,723		$	116,813
Net realized gain (loss)		195,105			3,226,523			764			179,275
Net change in unrealized appreciation
(depreciation)		1,581,300			(1,699,413	)		323,349			(100,101	)
Net increase (decrease) in net assets
resulting from operations		1,895,533			2,298,412			358,836			195,987
Distributions to shareholders from:
Net investment income and short term
gains received from Underlying Funds:
Class A		(21,530	)		(573,874	)		(233	)		(33,806	)
Class C		(7,453	)		(128,295	)		(463	)		(10,280	)
Class R		(2,261	)		(46,475	)		(142	)		(427	)
Class R6		(5,512	)		(177,480	)		(1,873	)		(96,340	)
Advisor Class		(924	)		(32,068	)		(98	)		(5,638	)
Net realized gains:
Class A		(705,690	)		(1,473,826	)		(55,284	)		(8,447	)
Class C		(244,970	)		(526,372	)		(23,832	)		(3,776	)
Class R		(72,292	)		(179,450	)		(8,578	)		(105	)
Class R6		(184,595	)		(284,880	)		(97,907	)		(9,214	)
Advisor Class		(30,165	)		(68,278	)		(5,059	)		(1,645	)
Total distributions to shareholders		(1,275,392	)		(3,490,998	)		(193,469	)		(169,678	)
Capital share transactions: (Note 2)
Class A		3,616,651			6,825,898			1,968,422			1,768,589
Class C		1,143,400			2,521,308			864,633			846,022
Class R		398,894			(1,071,543	)		634,721			21,467
Class R6		953,759			7,635,222			1,102,592			6,371,333
Advisor Class		61,895			417,920			58,595			243,508
Total capital share transactions		6,174,599			16,328,805			4,628,963			9,250,919
Net increase (decrease) in net
assets		6,794,740			15,136,219			4,794,330			9,277,228
Net assets:
Beginning of period		60,080,745			44,944,526			9,969,678			692,450
End of period	$	66,875,485		$	60,080,745		$	14,764,008		$	9,969,678
Undistributed net investment income included
in net assets:
End of period	$	118,824		$	37,376		$	34,712		$	2,798

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		FRANKLIN FUND ALLOCATOR SERIES
		FINANCIAL STATEMENTS


Statements of Changes in Net Assets (continued)

		Franklin LifeSmart
		2055 Retirement
		Target Fund
		Six Months Ended
		June 30, 2015
		(unaudited)^a
Increase (decrease) in net assets:
Operations:
Net investment income	$	1,399
Net realized gain (loss)		817
Net change in unrealized appreciation (depreciation)		(13,465	)
Net increase (decrease) in net assets resulting from operations		(11,249	)
Distributions to shareholders from:
Net investment income:
Class A		(456	)
Class C		(5	)
Class R		(5	)
Class R6		(5	)
Advisor Class		(5	)
Total distributions to shareholders		(476	)
Capital share transactions: (Note 2)
Class A		1,003,465
Class C		33,404
Class R		10,000
Class R6		10,000
Advisor Class		11,574
Total capital share transactions		1,068,443
Net increase (decrease) in net assets		1,056,718
Net assets:
End of period	$	1,056,718
Undistributed net investment income included in net assets:
End of period	$	923

^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.

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FRANKLIN FUND ALLOCATOR SERIES

Notes to Financial Statements (unaudited)

1. Organization and Significant Accounting Policies

Franklin Fund Allocator Series (Trust) is registered under the Investment Company Act of 1940 (1940 Act) as an open-end management investment company, consisting of twenty separate funds, nine of which are included in this report (Funds) and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP). The financial statements of the remaining funds in the Trust are presented separately. The Funds invest primarily in Franklin Templeton mutual funds (Underlying Funds). The Funds offer five classes of shares: Class A, Class C, Class R, Class R6, and Advisor Class. Each class of shares differs by its initial sales load, contingent deferred sales charges, voting rights on matters affecting a single class, its exchange privilege and fees primarily due to differing arrangements for distribution and transfer agent fees.

Effective May 1, 2015, the Trust began offering shares of Franklin LifeSmart 2055 Retirement Target Fund.

The accounting policies of the Underlying Funds are outlined in their respective shareholder reports. A copy of the Underlying Funds’ shareholder reports, in which each fund invests, is available on the U.S. Securities and Exchange Commission (SEC) website at sec.gov or at the SEC’s Public Reference Room in Washington, D.C. The Underlying Funds’ shareholder reports are not covered by this report.

The following summarizes the Funds’ significant accounting policies.

a. Financial Instrument Valuation

The Funds’ investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Funds calculate the net asset value (NAV) per share at the close of the New York Stock Exchange (NYSE), generally at 4 p.m. Eastern time (NYSE close) on each day the NYSE is open for trading. Under compliance policies and procedures approved by the Trust’s Board of Trustees (the Board), the Funds’ administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation and Liquidity Oversight Committee (VLOC). The VLOC provides administration and oversight of the Funds’ valuation policies and procedures, which are approved annually by the Board.

Investments in the Underlying Funds are valued at their closing NAV each trading day. Exchange traded funds (ETFs) listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively.

b. Income Taxes

It is each fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. Each fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and excise taxes. As a result, no provision for U.S. federal income taxes is required.

Each fund recognizes the tax benefits of uncertain tax positions only when the position is “more likely than not” to be sustained upon examination by the tax authorities based on the technical merits of the tax position. As of June 30, 2015, and for all open tax years, each fund has determined that no liability for unrecognized tax benefits is required in each fund’s financial statements related to uncertain tax positions taken on a tax return (or expected to be taken on future tax returns). Open tax years are those that remain subject to examination and are based on each tax jurisdiction’s statute of limitation.

c. Security Transactions, Investment Income, Expenses and Distributions

Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Estimated expenses are accrued daily. Dividend income and realized gain distributions by Underlying Funds and ETFs are recorded on the ex-dividend date. Distributions to shareholders are recorded on the ex-dividend date and are determined according to income tax regulations (tax basis). Distributable earnings determined on a tax basis may differ from earnings recorded in accordance with U.S. GAAP. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.

Common expenses incurred by the Trust are allocated among the funds based on the ratio of net assets of each fund to the combined net assets of the Trust. Fund specific expenses are charged directly to the fund that incurred the expense.

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FRANKLIN FUND ALLOCATOR SERIES

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

The Funds indirectly bear their proportionate share of expenses from the Underlying Funds and ETFs. Since the Underlying Funds and ETFs have varied expense levels and the Funds may own different proportions of the Underlying Funds and ETFs at different times, the amount of expenses incurred indirectly by the Funds will vary.

Realized and unrealized gains and losses and net investment income, not including class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions, by class, are generally due to differences in class specific expenses.

d. Offering Costs

Offering costs are amortized on a straight line basis over twelve months.

e. Accounting Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

f. Guarantees and Indemnifications

Under the Trust’s organizational documents, its officers and trustees are indemnified by the Trust against certain liabilities arising out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust, on behalf of the Funds, enters into contracts with service providers that contain general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. Currently, the Trust expects the risk of loss to be remote.

2. Shares of Beneficial Interest

At June 30, 2015, there were an unlimited number of shares authorized (without par value). Transactions in the Funds’ shares were as follows:


	Franklin LifeSmart					Franklin LifeSmart
	2015 Retirement					2020 Retirement
	Target Fund					Target Fund
	Shares			Amount		Shares			Amount

Class A Shares:
Six Months ended June 30, 2015
Shares sold	459,719		$	5,439,394		673,030		$	7,713,556
Shares issued in reinvestment of distributions	88,550			1,037,069		15,602			177,657
Shares redeemed	(509,676	)		(6,015,628	)	(97,399	)		(1,106,549	)
Net increase (decrease)	38,593		$	460,835		591,233		$	6,784,664
Year ended December 31, 2014
Shares sold	1,138,380		$	14,073,557		506,546		$	5,673,408
Shares issued in reinvestment of distributions	313,379			3,724,655		15,235			170,546
Shares redeemed	(940,611	)		(11,627,643	)	(66,096	)		(730,777	)
Net increase (decrease)	511,148		$	6,170,569		455,685		$	5,113,177
Class C Shares:
Six Months ended June 30, 2015
Shares sold	316,409		$	3,696,218		169,048		$	1,923,531
Shares issued in reinvestment of distributions	32,381			375,227		4,131			46,807
Shares redeemed	(265,892	)		(3,115,519	)	(9,778	)		(111,925	)
Net increase (decrease)	82,898		$	955,926		163,401		$	1,858,413
Year ended December 31, 2014
Shares sold	469,764		$	5,751,377		214,931		$	2,379,192
Shares issued in reinvestment of distributions	118,197			1,387,970		4,969			55,351
Shares redeemed	(430,341	)		(5,263,257	)	(6,734	)		(75,706	)
Net increase (decrease)	157,620		$	1,876,090		213,166		$	2,358,837

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


2. Shares of Beneficial Interest (continued)
	Franklin LifeSmart					Franklin LifeSmart
	2015 Retirement					2020 Retirement
	Target Fund					Target Fund
	Shares			Amount		Shares			Amount

Class R Shares:
Six Months ended June 30, 2015
Shares sold	129,919		$	1,531,035		50,992		$	580,731
Shares issued in reinvestment of distributions	5,558			64,869		618			7,018
Shares redeemed	(50,576	)		(598,945	)	(7,572	)		(85,583	)
Net increase (decrease)	84,901		$	996,959		44,038		$	502,166
Year ended December 31, 2014
Shares sold	124,788		$	1,541,001		6,286		$	71,371
Shares issued in reinvestment of distributions	14,644			173,814		118			1,322
Shares redeemed	(82,478	)		(1,021,136	)	(225	)		(2,555	)
Net increase (decrease)	56,954		$	693,679		6,179		$	70,138
Class R6 Shares:
Six Months ended June 30, 2015
Shares sold	35,055		$	414,917		56,412		$	639,098
Shares issued in reinvestment of distributions	2,075			24,412		30			340
Shares redeemed	(114,631	)		(1,359,935	)	(66,570	)		(765,946	)
Net increase (decrease)	(77,501	)	$	(920,606	)	(10,128	)	$	(126,508	)
Year ended December 31, 2014
Shares sold	810,319		$	10,083,538		706,698		$	8,046,414
Shares issued in reinvestment of distributions	7,116			84,977		24			264
Shares redeemed	(306,858	)		(3,775,510	)	(47,752	)		(539,248	)
Net increase (decrease)	510,577		$	6,393,005		658,970		$	7,507,430
Advisor Class Shares:
Six Months ended June 30, 2015
Shares sold	72,035		$	862,012		11,595		$	130,138
Shares issued in reinvestment of distributions	5,343			62,780		279			3,177
Shares redeemed	(14,453	)		(171,216	)	(52	)		(596	)
Net increase (decrease)	62,925		$	753,576		11,822		$	132,719
Year ended December 31, 2014
Shares sold	60,712		$	759,764		26,162		$	292,957
Shares issued in reinvestment of distributions	14,464			172,492		191			2,131
Shares redeemed	(90,371	)		(1,118,226	)	(21,541	)		(235,434	)
Net increase (decrease)	(15,195	)	$	(185,970	)	4,812		$	59,654

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


	Franklin LifeSmart					Franklin LifeSmart
	2025 Retirement					2030 Retirement
	Target Fund					Target Fund
	Shares			Amount		Shares			Amount

Class A Shares:
Six Months ended June 30, 2015
Shares sold	774,705		$	9,824,420		452,999		$	5,378,677
Shares issued in reinvestment of distributions	94,816			1,203,076		11,062			130,741
Shares redeemed	(523,716	)		(6,648,843	)	(57,415	)		(671,449	)
Net increase (decrease)	345,805		$	4,378,653		406,646		$	4,837,969
Year ended December 31, 2014
Shares sold	1,513,145		$	19,494,646		341,737		$	3,872,100
Shares issued in reinvestment of distributions	383,827			4,822,448		7,982			91,727
Shares redeemed	(1,015,101	)		(13,087,723	)	(17,789	)		(204,458	)
Net increase (decrease)	881,871		$	11,229,371		331,930		$	3,759,369
Class C Shares:
Six Months ended June 30, 2015
Shares sold	287,244		$	3,586,750		89,390		$	1,052,009
Shares issued in reinvestment of distributions	36,502			454,806		3,345			39,160
Shares redeemed	(222,078	)		(2,774,088	)	(8,726	)		(100,945	)
Net increase (decrease)	101,668		$	1,267,468		84,009		$	990,224
Year ended December 31, 2014
Shares sold	601,269		$	7,635,270		165,124		$	1,879,175
Shares issued in reinvestment of distributions	138,184			1,708,829		2,716			31,001
Shares redeemed	(387,274	)		(4,933,830	)	(8,337	)		(93,433	)
Net increase (decrease)	352,179		$	4,410,269		159,503		$	1,816,743
Class R Shares:
Six Months ended June 30, 2015
Shares sold	89,990		$	1,136,420		65,684		$	780,853
Shares issued in reinvestment of distributions	6,147			77,576		893			10,532
Shares redeemed	(70,252	)		(888,072	)	(1,501	)		(17,311	)
Net increase (decrease)	25,885		$	325,924		65,076		$	774,074
Year ended December 31, 2014
Shares sold	106,302		$	1,362,966		3,287		$	37,604
Shares issued in reinvestment of distributions	24,165			302,271		51			587
Shares redeemed	(75,290	)		(970,294	)	(3,433	)		(38,191	)
Net increase (decrease)	55,177		$	694,943		(95	)	$	—
Class R6 Shares:
Six Months ended June 30, 2015
Shares sold	110,373		$	1,397,894		134,797		$	1,584,090
Shares issued in reinvestment of distributions	5,237			66,708		4			43
Shares redeemed	(88,893	)		(1,128,984	)	(96,199	)		(1,132,043	)
Net increase (decrease)	26,717		$	335,618		38,602		$	452,090
Year ended December 31, 2014
Shares sold	1,071,996		$	13,927,445		1,124,168		$	13,048,653
Shares issued in reinvestment of distributions	15,562			195,828		—			—
Shares redeemed	(139,760	)		(1,800,242	)	(75,482	)		(879,187	)
Net increase (decrease)	947,798		$	12,323,031		1,048,686		$	12,169,466

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Semiannual Report | ₁₄₇


FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)




2. Shares of Beneficial Interest (continued)
	Franklin LifeSmart							Franklin LifeSmart
	2025 Retirement							2030 Retirement
	Target Fund							Target Fund
	Shares					Amount		Shares			Amount

Advisor Class Shares:
Six Months ended June 30, 2015
Shares sold	138,223		$			1,758,993		330			$	3,900
Shares issued in reinvestment of distributions	4,961					63,150		121				1,430
Shares redeemed	(50,122	)				(640,474	)	—				—
Net increase (decrease)	93,062		$			1,181,669		451			$	5,330
Year ended December 31, 2014
Shares sold	64,856		$			843,185		2,199			$	25,200
Shares issued in reinvestment of distributions	16,249					204,646		197				2,264
Shares redeemed	(48,334	)				(628,722	)	(1,001	)			(11,140	)
Net increase (decrease)	32,771		$			419,109		1,395			$	16,324

	Franklin LifeSmart							Franklin LifeSmart
	2035 Retirement							2040 Retirement
	Target Fund							Target Fund
	Shares					Amount		Shares				Amount

Class A Shares:
Six Months ended June 30, 2015
Shares sold	554,357				$	7,209,181		323,395		$	3,865,058
Shares issued in reinvestment of distributions	73,604					958,990		6,924				83,080
Shares redeemed	(317,477			)		(4,143,048	)	(52,247	)			(614,798	)
Net increase (decrease)	310,484				$	4,025,123		278,072		$	3,333,340
Year ended December 31, 2014
Shares sold	908,083				$	11,845,541		205,931		$	2,372,454
Shares issued in reinvestment of distributions	231,370					2,968,905		3,843				44,632
Shares redeemed	(480,397			)		(6,253,759	)	(20,256	)			(233,017	)
Net increase (decrease)	659,056				$	8,560,687		189,518		$	2,184,069
Class C Shares:
Six Months ended June 30, 2015
Shares sold	256,670				$	3,278,390		45,389		$	539,305
Shares issued in reinvestment of distributions	26,418					336,296		1,364				16,223
Shares redeemed	(206,786			)		(2,655,479	)	(4,012	)			(47,089	)
Net increase (decrease)	76,302				$	959,207		42,741		$	508,439
Year ended December 31, 2014
Shares sold	455,352				$	5,807,235		61,797		$	704,591
Shares issued in reinvestment of distributions	75,659					952,637		896				10,337
Shares redeemed	(260,511			)		(3,304,497	)	(3,254	)			(37,703	)
Net increase (decrease)	270,500				$	3,455,375		59,439		$	677,225

₁₄₈| Semiannual Report

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


	Franklin LifeSmart					Franklin LifeSmart
	2035 Retirement					2040 Retirement
	Target Fund					Target Fund
	Shares			Amount		Shares			Amount

Class R Shares:
Six Months ended June 30, 2015
Shares sold	161,619		$	2,062,492		49,695		$	587,379
Shares issued in reinvestment of distributions	5,652			73,526		677			8,115
Shares redeemed	(124,793	)		(1,610,213	)	(131	)		(1,553	)
Net increase (decrease)	42,478		$	525,805		50,241		$	593,941
Year ended December 31, 2014
Shares sold	107,368		$	1,403,135		2,187		$	25,117
Shares issued in reinvestment of distributions	15,491			198,596		33			384
Shares redeemed	(80,077	)		(1,039,488	)	(3	)		(31	)
Net increase (decrease)	42,782		$	562,243		2,217		$	25,470
Class R6 Shares:
Six Months ended June 30, 2015
Shares sold	249,739		$	3,276,418		146,446		$	1,741,489
Shares issued in reinvestment of distributions	2,809			36,871		36			436
Shares redeemed	(133,403	)		(1,745,192	)	(64,349	)		(763,326	)
Net increase (decrease)	119,145		$	1,568,097		82,133		$	978,599
Year ended December 31, 2014
Shares sold	1,209,949		$	16,125,117		955,439		$	11,147,448
Shares issued in reinvestment of distributions	12,998			167,922		16			186
Shares redeemed	(143,165	)		(1,893,622	)	(81,583	)		(950,453	)
Net increase (decrease)	1,079,782		$	14,399,417		873,872		$	10,197,181
Advisor Class Shares:
Six Months ended June 30, 2015
Shares sold	124,476		$	1,646,054		249		$	2,914
Shares issued in reinvestment of distributions	5,147			67,622		15			175
Shares redeemed	(4,261	)		(56,199	)	(138	)		(1,667	)
Net increase (decrease)	125,362		$	1,657,477		126		$	1,422
Year ended December 31, 2014
Shares sold	44,710		$	589,527		1,114		$	12,924
Shares issued in reinvestment of distributions	10,678			137,870		23			263
Shares redeemed	(24,717	)		(321,978	)	(1,192	)		(13,722	)
Net increase (decrease)	30,671		$	405,419		(55	)	$	(535	)

	Franklin LifeSmart					Franklin LifeSmart
	2045 Retirement					2050 Retirement
	Target Fund					Target Fund
	Shares			Amount		Shares			Amount

Class A Shares:
Six Months ended June 30, 2015
Shares sold	491,912		$	6,419,659		212,697		$	2,563,820
Shares issued in reinvestment of distributions	53,733			701,723		4,610			55,517
Shares redeemed	(267,956	)		(3,504,731	)	(55,298	)		(650,915	)
Net increase (decrease)	277,689		$	3,616,651		162,009		$	1,968,422
Year ended December 31, 2014
Shares sold	806,549		$	10,536,870		155,648		$	1,788,729
Shares issued in reinvestment of distributions	154,590			1,987,048		3,193			37,209
Shares redeemed	(436,152	)		(5,698,020	)	(4,983	)		(57,349	)
Net increase (decrease)	524,987		$	6,825,898		153,858		$	1,768,589

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


2. Shares of Beneficial Interest (continued)
	Franklin LifeSmart					Franklin LifeSmart
	2045 Retirement					2050 Retirement
	Target Fund					Target Fund
	Shares			Amount		Shares			Amount

Class C Shares:
Six Months ended June 30, 2015
Shares sold	181,184		$	2,318,455		103,460		$	1,213,579
Shares issued in reinvestment of distributions	16,486			209,865		2,037			24,296
Shares redeemed	(108,309	)		(1,384,920	)	(31,082	)		(373,242	)
Net increase (decrease)	89,361		$	1,143,400		74,415		$	864,633
Year ended December 31, 2014
Shares sold	314,837		$	4,013,365		75,187		$	857,385
Shares issued in reinvestment of distributions	42,980			540,685		1,195			13,863
Shares redeemed	(160,167	)		(2,032,742	)	(2,197	)		(25,226	)
Net increase (decrease)	197,650		$	2,521,308		74,185		$	846,022
Class R Shares:
Six Months ended June 30, 2015
Shares sold	68,467		$	896,713		53,121		$	632,676
Shares issued in reinvestment of distributions	4,772			62,085		712			8,561
Shares redeemed	(42,638	)		(559,904	)	(536	)		(6,516	)
Net increase (decrease)	30,601		$	398,894		53,297		$	634,721
Year ended December 31, 2014
Shares sold	119,001		$	1,543,737		1,813		$	21,150
Shares issued in reinvestment of distributions	14,511			186,373		27			317
Shares redeemed	(214,951	)		(2,801,653	)	—			—
Net increase (decrease)	(81,439	)	$	(1,071,543	)	1,840		$	21,467
Class R6 Shares:
Six Months ended June 30, 2015
Shares sold	124,478		$	1,635,786		141,846		$	1,686,356
Shares issued in reinvestment of distributions	2,550			33,560		19			230
Shares redeemed	(54,701	)		(715,587	)	(48,255	)		(583,994	)
Net increase (decrease)	72,327		$	953,759		93,610		$	1,102,592
Year ended December 31, 2014
Shares sold	674,936		$	9,009,240		611,429		$	7,162,550
Shares issued in reinvestment of distributions	8,952			115,736		—^a			1
Shares redeemed	(112,726	)		(1,489,754	)	(67,478	)		(791,218	)
Net increase (decrease)	571,162		$	7,635,222		543,951		$	6,371,333
Advisor Class Shares:
Six Months ended June 30, 2015
Shares sold	31,345		$	411,737		4,472		$	53,438
Shares issued in reinvestment of distributions	2,364			31,089		427			5,157
Shares redeemed	(29,161	)		(380,931	)	—			—
Net increase (decrease)	4,548		$	61,895		4,899		$	58,595
Year ended December 31, 2014
Shares sold	40,025		$	528,680		32,370		$	372,509
Shares issued in reinvestment of distributions	7,290			94,198		624			7,284
Shares redeemed	(15,676	)		(204,958	)	(11,622	)		(136,285	)
Net increase (decrease)	31,639		$	417,920		21,372		$	243,508
^aRounds to less than 1 share.

₁₅₀| Semiannual Report

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


	Franklin LifeSmart
	2055 Retirement
	Target Fund^a
	Shares				Amount

Class A Shares:
Six Months ended June 30, 2015
Shares sold	100,329		$	1,003,461
Shares issued in reinvestment of distributions	1				14
Shares redeemed	(1	)			(10	)
Net increase (decrease)	100,329		$	1,003,465
Class C Shares:
Six Months ended June 30, 2015
Shares sold	3,371			$	33,414
Shares redeemed	(1	)			(10	)
Net increase (decrease)	3,370			$	33,404
Class R Shares:
Six Months ended June 30, 2015
Shares sold	1,001			$	10,010
Shares redeemed	(1	)			(10	)
Net increase (decrease)	1,000			$	10,000
Class R6 Shares:
Six Months ended June 30, 2015
Shares sold	1,001			$	10,010
Shares redeemed	(1	)			(10	)
Net increase (decrease)	1,000			$	10,000
Advisor Class Shares:
Six Months ended June 30, 2015
Shares sold	1,158			$	11,584
Shares redeemed	(1	)			(10	)
Net increase (decrease)	1,157			$	11,574
^aFor the period May 1, 2015 (commencement of operations) to June 30, 2015.

3. Transactions with Affiliates

Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton Investments. Certain officers and trustees of the Funds are also officers and/or directors/trustees of certain of the Underlying Funds and of the following subsidiaries:


Subsidiary	Affiliation
Franklin Advisers, Inc. (Advisers)	Investment manager
Franklin Templeton Services, LLC (FT Services)	Administrative manager
Franklin Templeton Distributors, Inc. (Distributors)	Principal underwriter
Franklin Templeton Investor Services, LLC (Investor Services)	Transfer agent

a. Asset Allocation Fees

The Funds pay an asset allocation fee to Advisers of 0.25% per year of the average daily net assets of each of the Funds for investment advisory services, consisting principally of determining the allocation of assets of the Funds among the designated Underlying Funds and ETFs.

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Semiannual Report | ₁₅₁

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

3. Transactions with Affiliates (continued)

b. Administrative Fees

Under an agreement with Advisers, FT Services provides administrative services to the Funds and is not paid by the Funds for the services.

c. Distribution Fees

The Board has adopted distribution plans for each share class, with the exception of Class R6 and Advisor Class shares, pursuant to Rule 12b-1 under the 1940 Act. Distribution fees are not charged on shares held by affiliates. Under the Funds’ Class A reimbursement distribution plans, the Funds reimburse Distributors for costs incurred in connection with the servicing, sale and distribution of each fund’s shares up to the maximum annual plan rate for each class. Under the Class A reimbursement distribution plans, costs exceeding the maximum for the current plan year cannot be reimbursed in subsequent periods. In addition, under the Funds’ Class C and R compensation distribution plans, the Funds pay Distributors for costs incurred in connection with the servicing, sale and distribution of each fund’s shares up to the maximum annual plan rate for each class. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31 for each fund.

The maximum annual plan rates, based on the average daily net assets, for each class, are as follows:


Class A	0.35	%
Class C	1.00	%
Class R	0.50	%

The Board set the current rate at 0.30% per year for Class A shares. On July 15, 2015, the Board approved to set the rate at 0.25% per year for Class A shares, effective August 1, 2015, until further notice and approval by the Board.

d. Sales Charges/Underwriting Agreements

Front-end sales charges and contingent deferred sales charges (CDSC) do not represent expenses of the Funds. These charges are deducted from the proceeds of sales of fund shares prior to investment or from redemption proceeds prior to remittance, as applicable. Distributors has advised the Funds of the following commission transactions related to the sales and redemptions of the Funds’ shares for the period:


		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2015 Retirement		2020 Retirement		2025 Retirement
		Target Fund		Target Fund		Target Fund
Sales charges retained net of commissions paid to unaffiliated
broker/dealers	$	11,817	$	10,240	$	35,162
CDSC retained	$	3,286	$	20	$	1,673

		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2030 Retirement		2035 Retirement		2040 Retirement
		Target Fund		Target Fund		Target Fund
Sales charges retained net of commissions paid to unaffiliated
broker/dealers	$	11,685	$	28,272	$	9,282
CDSC retained	$	389	$	1,336	$	169

₁₅₂| Semiannual Report

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		FRANKLIN FUND ALLOCATOR SERIES
		NOTES TO FINANCIAL STATEMENTS (UNAUDITED)




		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2045 Retirement		2050 Retirement		2055 Retirement
		Target Fund		Target Fund		Target Fund
Sales charges retained net of commissions paid to unaffiliated
broker/dealers	$	27,974	$	11,148	$	268
CDSC retained	$	1,630	$	174	$	—

e. Transfer Agent Fees

Each class of shares, except for Class R6, pays transfer agent fees to Investor Services for its performance of shareholder servicing obligations and reimburses Investor Services for out of pocket expenses incurred, including shareholding servicing fees paid to third parties. These fees are allocated daily based upon their relative proportion of such classes’ aggregate net assets. Class R6 pays Investor Services transfer agent fees specific to that class.

For the period ended June 30, 2015, the Funds paid transfer agent fees as noted in the Statements of Operations of which the following amounts were retained by Investor Services:


		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2015 Retirement		2020 Retirement		2025 Retirement
		Target Fund		Target Fund		Target Fund

Transfer agent fees	$	23,364	$	5,599	$	41,737

		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2030 Retirement		2035 Retirement		2040 Retirement
		Target Fund		Target Fund		Target Fund

Transfer agent fees	$	6,882	$	40,980	$	6,199

		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart
		2045 Retirement		2050 Retirement		2055 Retirement
		Target Fund		Target Fund		Target Fund

Transfer agent fees	$	48,238	$	11,191	$	50

f. Investments in Underlying Funds

The Funds invest primarily in the Underlying Funds which are managed by Advisers (or an affiliate of Advisers). The Funds do not invest in the Underlying Funds for the purpose of exercising a controlling influence over the management or policies. Asset allocation fees paid by the Funds are waived on assets invested in Institutional Fiduciary Trust Money Market Portfolio (Sweep Money Fund), as noted in the Statements of Operations, in an amount not to exceed the management and administrative fees paid directly or indirectly by the Sweep Money Fund. Prior to January 1, 2014, the waiver was accounted for as a reduction to asset allocation fees.

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Semiannual Report | ₁₅₃


FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)




3. Transactions with Affiliates (continued)

f. Investments in Underlying Funds (continued)

Investments in Underlying Funds for the period ended June 30, 2015, were as follows:

													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2015 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	2,940	—	(86	)	2,854	$	586,893	$	—	$	6,633		0.03	%
Franklin DynaTech Fund, Class R6	43,651	—	(2,254	)	41,397		2,096,330		—		35,572		0.07	%
Franklin Emerging Market Debt Opportunities
Fund	252,312	2,888	(10,027	)	245,173		2,655,222		—		(18,551	)	0.37	%
Franklin Focused Core Equity Fund,
Class R6	140,564	—	(3,953	)	136,611		2,114,738		—		2,878		2.98	%
Franklin Growth Fund, Class R6	45,066	5,253	(12,459	)	37,860		2,925,067		—		50,179		0.02	%
Franklin Growth Opportunities Fund,
Class R6	45,912	—	(1,280	)	44,632		1,588,892		—		2,293		0.13	%
Franklin International Growth Fund,
Class R6	—	65,348	—		65,348		737,782		—		—		0.16	%
Franklin International Small Cap Growth
Fund, Class R6	116,071	—	(3,261	)	112,810		2,208,822		—		1,249		0.12	%
Franklin K2 Alternative Strategies Fund,
Class R6	229,276	213,502	—		442,778		4,888,266		—		—		0.62	%
Franklin Low Duration Total Return Fund,
Class R6	1,480,629	26,758	(87,623	)	1,419,764		14,226,039		122,651		(12,576	)	0.57	%
Franklin Mutual International Fund,
Class R6	131,527	—	(3,716	)	127,811		1,973,405		—		(3,271	)	1.10	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	89,402	1,064	—		90,466		655,878		—		—		1.16	%
Franklin Real Estate Securities Fund,
Class R6	21,231	127	(5,439	)	15,919		326,667		2,745		37,102		0.06	%
Franklin Rising Dividends Fund, Class R6	48,592	274	(4,454	)	44,412		2,292,984		14,486		76,883		0.01	%
Franklin Short Duration U.S. Government
ETF	—	7,837	—		7,837		775,642		767		—		0.78	%
Franklin Small Cap Growth Fund,
Class R6	39,435	—	(1,132	)	38,303		810,118		—		3,650		0.02	%
Franklin Strategic Income Fund, Class R6	525,202	18,302	(30,611	)	512,893		5,046,863		100,564		(17,187	)	0.06	%
Franklin Utilities Fund, Class R6	66,067	866	(8,293	)	58,640		934,719		14,678		48,839		0.02	%
Institutional Fiduciary Trust Money Market
Portfolio	1,466,544	9,292,357	(8,482,616	)	2,276,285		2,276,285		—		—		0.01	%
Templeton China World Fund, Class R6	15,700	—	(447	)	15,253		504,115		—		165		0.08	%
Templeton Foreign Fund, Class R6	133,447	—	(3,744	)	129,703		935,158		—		679		0.01	%
Templeton Frontier Markets Fund,
Class R6	55,581	—	(1,601	)	53,980		753,562		—		(2,720	)	0.09	%
Templeton Global Total Return Fund,
Class R6	1,575,696	52,465	(93,711	)	1,534,450		18,858,391		428,021		(124,035	)	0.23	%
Total						$	70,171,838	$	683,912	$	87,782

₁₅₄| Semiannual Report

franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2020 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	820	424	(16	)	1,228	$	252,459	$	—	$	21		0.01	%
Franklin DynaTech Fund, Class R6	17,226	8,875	(265	)	25,836		1,308,310		—		298		0.05	%
Franklin Emerging Market Debt Opportunities
Fund	27,473	15,805	(3,567	)	39,711		430,075		—		(5,768	)	0.06	%
Franklin Focused Core Equity Fund,
Class R6	51,900	26,678	(799	)	77,779		1,204,020		—		312		0.72	%
Franklin Growth Fund, Class R6	18,344	8,492	(4,642	)	22,194		1,714,724		—		9,250		0.01	%
Franklin Growth Opportunities Fund,
Class R6	17,099	8,831	(262	)	25,668		913,772		—		293		0.07	%
Franklin International Growth Fund,
Class R6	—	35,325	—		35,325		398,824		—		—		0.09	%
Franklin International Small Cap Growth
Fund, Class R6	48,342	24,904	(744	)	72,502		1,419,593		—		(3,318	)	0.08	%
Franklin K2 Alternative Strategies Fund,
Class R6	47,376	90,953	—		138,329		1,527,151		—		—		0.19	%
Franklin Low Duration Total Return Fund,
Class R6	198,426	115,487	(25,277	)	288,636		2,892,134		17,196		(3,232	)	0.12	%
Franklin Mutual International Fund,
Class R6	48,630	20,065	(730	)	67,965		1,049,374		—		(708	)	0.59	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	18,693	10,300	—		28,993		210,199		—		—		0.37	%
Franklin Real Estate Securities Fund,
Class R6	7,284	3,169	(2,321	)	8,132		166,863		1,278		3,338		0.03	%
Franklin Rising Dividends Fund, Class R6	17,979	9,136	(1,237	)	25,878		1,336,069		7,564		196		0.01	%
Franklin Short Duration U.S. Government
ETF	—	1,493	—		1,493		147,765		125		—		0.15	%
Franklin Small Cap Growth Fund,
Class R6	13,905	7,217	(252	)	20,870		441,409		—		(88	)	0.01	%
Franklin Strategic Income Fund, Class R6	70,953	43,336	(9,226	)	105,063		1,033,820		21,333		(6,780	)	0.01	%
Franklin Utilities Fund, Class R6	25,093	12,606	(3,300	)	34,399		548,319		7,394		(743	)	0.01	%
Institutional Fiduciary Trust Money Market
Portfolio	369,780	9,188,481	(9,041,160	)	517,101		517,101		—		—		—^a
Templeton China World Fund, Class R6	5,444	2,738	(96	)	8,086		267,253		—		(633	)	0.04	%
Templeton Foreign Fund, Class R6	49,866	25,747	(850	)	74,763		539,041		—		(1,224	)	0.01	%
Templeton Frontier Markets Fund,
Class R6	19,701	10,216	(358	)	29,559		412,647		—		(2,009	)	0.05	%
Templeton Global Total Return Fund,
Class R6	204,752	124,345	(26,503	)	302,594		3,718,883		68,055		(34,150	)	0.04	%
Total						$	22,449,805	$	122,945	$	(44,945	)

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Semiannual Report | ₁₅₅

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


3. Transactions with Affiliates (continued)

f. Investments in Underlying Funds (continued)
												% of
												Underlying
	Number of				Number of							Fund Shares
	Shares Held				Shares		Value				Realized	Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain	Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)	of Period
Franklin LifeSmart 2025 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	8,889	568	—		9,457	$	1,944,431	$	—	$	—	0.09	%
Franklin DynaTech Fund, Class R6	144,889	9,541	—		154,430		7,820,345		—		—	0.28	%
Franklin Emerging Market Debt Opportunities
Fund	134,129	4,554	—		138,683		1,501,942		—		—	0.21	%
Franklin Focused Core Equity Fund,
Class R6	424,331	28,070	—		452,401		7,003,174		—		—	4.21	%
Franklin Growth Fund, Class R6	144,269	7,119	(38,057	)	113,331		8,755,923		—		234,272	0.07	%
Franklin Growth Opportunities Fund,
Class R6	132,232	8,854	—		141,086		5,022,668		—		—	0.40	%
Franklin International Growth Fund,
Class R6	—	263,169	—		263,169		2,971,177		—		—	0.65	%
Franklin International Small Cap Growth
Fund, Class R6	390,976	25,963	—		416,939		8,163,657		—		—	0.43	%
Franklin K2 Alternative Strategies Fund,
Class R6	323,419	368,968	—		692,387		7,643,958		—		—	0.96	%
Franklin Low Duration Total Return Fund,
Class R6	776,722	31,640	—		808,362		8,099,783		57,208		—	0.32	%
Franklin Mutual International Fund,
Class R6	394,960	26,352	—		421,312		6,505,053		—		—	3.64	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	126,611	13,513	—		140,124		1,015,902		—		—	1.79	%
Franklin Real Estate Securities Fund,
Class R6	62,303	4,059	(16,029	)	50,333		1,032,826		8,414		87,086	0.19	%
Franklin Rising Dividends Fund, Class R6	168,340	12,090	(7,089	)	173,341		8,949,608		54,629		5,431	0.05	%
Franklin Short Duration U.S. Government
ETF	—	4,761	—		4,761		471,205		467		—	0.48	%
Franklin Small Cap Growth Fund,
Class R6	142,971	9,811	—		152,782		3,231,334		—		—	0.08	%
Franklin Strategic Income Fund, Class R6	275,210	17,009	—		292,219		2,875,431		69,868		—	0.03	%
Franklin Utilities Fund, Class R6	206,213	15,926	(21,181	)	200,958		3,203,275		48,492		9,861	0.06	%
Institutional Fiduciary Trust Money Market
Portfolio	2,604,862	11,756,615	(12,182,811	)	2,178,666		2,178,666		—		—	0.01	%
Templeton China World Fund, Class R6	50,936	3,232	—		54,168		1,790,247		—		—	0.29	%
Templeton Foreign Fund, Class R6	364,219	26,582	—		390,801		2,817,673		—		—	0.04	%
Templeton Frontier Markets Fund,
Class R6	159,708	11,546	—		171,254		2,390,706		—		—	0.30	%
Templeton Global Total Return Fund,
Class R6	866,520	42,458	—		908,978		11,171,342		253,413		—	0.13	%
Total						$	106,560,326	$	492,491	$	336,650

₁₅₆| Semiannual Report

franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2030 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	1,284	898	(390	)	1,792	$	368,437	$	—	$	891		0.02	%
Franklin DynaTech Fund, Class R6	26,101	15,530	(5,580	)	36,051		1,825,602		—		1,506		0.06	%
Franklin Emerging Market Debt Opportunities
Fund	19,359	5,463	(2,771	)	22,051		238,810		—		(5,092	)	0.03	%
Franklin Focused Core Equity Fund,
Class R6	69,553	44,095	(17,332	)	96,316		1,490,978		—		520		0.90	%
Franklin Growth Fund, Class R6	26,820	15,139	(13,776	)	28,183		2,177,409		—		18,706		0.02	%
Franklin Growth Opportunities Fund,
Class R6	23,747	14,407	(5,335	)	32,819		1,168,365		—		747		0.09	%
Franklin International Growth Fund,
Class R6	—	59,386	—		59,386		670,468		—		—		0.15	%
Franklin International Small Cap Growth
Fund, Class R6	70,613	42,789	(15,850	)	97,552		1,910,063		—		(55,792	)	0.10	%
Franklin K2 Alternative Strategies Fund,
Class R6	54,954	87,894	—		142,848		1,577,058		—		—		0.20	%
Franklin Low Duration Total Return Fund,
Class R6	108,099	31,018	(15,449	)	123,668		1,239,157		7,951		(1,917	)	0.05	%
Franklin Mutual International Fund,
Class R6	65,271	40,641	(15,547	)	90,365		1,395,229		—		1,244		0.78	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	21,427	11,538	—		32,965		238,993		—		—		0.42	%
Franklin Real Estate Securities Fund,
Class R6	11,086	5,568	(4,922	)	11,732		240,745		1,877		5,735		0.04	%
Franklin Rising Dividends Fund, Class R6	27,448	17,288	(8,121	)	36,615		1,890,407		11,020		1,776		0.01	%
Franklin Short Duration U.S. Government
ETF	—	641	—		641		63,441		65		—		0.06	%
Franklin Small Cap Growth Fund,
Class R6	25,118	15,144	(5,526	)	34,736		734,657		—		829		0.02	%
Franklin Strategic Income Fund, Class R6	40,044	12,407	(5,758	)	46,693		459,458		10,123		(3,996	)	0.01	%
Franklin Utilities Fund, Class R6	35,886	21,609	(12,024	)	45,471		724,807		10,013		(113	)	0.01	%
Institutional Fiduciary Trust Money Market
Portfolio	276,857	8,072,233	(7,885,808	)	463,282		463,282		—		—		—^a
Templeton China World Fund, Class R6	9,590	5,728	(2,035	)	13,283		439,007		—		(4,711	)	0.07	%
Templeton Foreign Fund, Class R6	68,119	42,151	(15,819	)	94,451		680,991		—		(15,661	)	0.01	%
Templeton Frontier Markets Fund,
Class R6	30,174	18,252	(6,673	)	41,753		582,877		—		(35,650	)	0.07	%
Templeton Global Total Return Fund,
Class R6	115,462	35,300	(16,651	)	134,111		1,648,218		33,491		(20,279	)	0.02	%
Total						$	22,228,459	$	74,540	$	(111,257	)

franklintempleton.com

Semiannual Report | ₁₅₇

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


3. Transactions with Affiliates (continued)

f. Investments in Underlying Funds (continued)
													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2035 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	8,872	613	—		9,485	$	1,950,283	$	—	$	—		0.09	%
Franklin DynaTech Fund, Class R6	125,016	10,757	—		135,773		6,875,540		—		—		0.24	%
Franklin Emerging Market Debt Opportunities
Fund	67,581	—	(2,747	)	64,834		702,156		—		(5,686	)	0.10	%
Franklin Focused Core Equity Fund,
Class R6	386,899	32,875	—		419,774		6,498,102		—		—		3.90	%
Franklin Growth Fund, Class R6	130,286	10,620	(33,829	)	107,077		8,272,772		—		159,758		0.07	%
Franklin Growth Opportunities Fund,
Class R6	119,254	10,262	—		129,516		4,610,754		—		—		0.37	%
Franklin International Growth Fund,
Class R6	—	231,290	—		231,290		2,611,261		—		—		0.57	%
Franklin International Small Cap Growth
Fund, Class R6	349,232	30,250	—		379,482		7,430,258		—		—		0.39	%
Franklin K2 Alternative Strategies Fund,
Class R6	267,293	296,446	—		563,739		6,223,680		—		—		0.78	%
Franklin Low Duration Total Return Fund,
Class R6	360,391	9,511	(15,030	)	354,872		3,555,815		25,239		(1,954	)	0.14	%
Franklin Mutual International Fund,
Class R6	355,335	24,590	—		379,925		5,866,046		—		—		3.28	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	102,696	9,460	—		112,156		813,129		—		—		1.44	%
Franklin Real Estate Securities Fund,
Class R6	59,367	3,618	(15,471	)	47,514		974,994		7,923		78,229		0.18	%
Franklin Rising Dividends Fund, Class R6	159,006	14,427	(6,841	)	166,592		8,601,164		52,451		1,276		0.05	%
Franklin Short Duration U.S. Government
ETF	—	2,216	—		2,216		219,322		216		—		0.22	%
Franklin Small Cap Growth Fund,
Class R6	125,329	8,709	—		134,038		2,834,903		—		—		0.07	%
Franklin Strategic Income Fund, Class R6	130,027	3,098	(5,371	)	127,754		1,257,101		30,978		(3,276	)	0.01	%
Franklin Utilities Fund, Class R6	203,433	15,943	(20,443	)	198,933		3,170,999		47,620		(2,236	)	0.06	%
Institutional Fiduciary Trust Money Market
Portfolio	1,512,212	11,983,019	(12,129,756	)	1,365,475		1,365,475		—		—		0.01	%
Templeton China World Fund, Class R6	47,246	3,239	—		50,485		1,668,515		—		—		0.27	%
Templeton Foreign Fund, Class R6	360,354	24,919	—		385,273		2,777,819		—		—		0.04	%
Templeton Frontier Markets Fund,
Class R6	151,592	10,505	—		162,097		2,262,874		—		—		0.28	%
Templeton Global Total Return Fund,
Class R6	399,555	14,702	(16,747	)	397,510		4,885,401		113,284		(24,618	)	0.06	%
Total						$	85,428,363	$	277,711	$	201,493

₁₅₈| Semiannual Report

franklintempleton.com

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2040 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	1,140	444	—		1,584	$	325,694	$	—	$	—		0.02	%
Franklin DynaTech Fund, Class R6	21,319	8,283	—		29,602		1,499,065		—		—		0.05	%
Franklin Emerging Market Debt Opportunities
Fund	8,863	430	(1,417	)	7,876		85,302		—		(2,483	)	0.01	%
Franklin Focused Core Equity Fund,
Class R6	59,127	22,943	—		82,070		1,270,447		—		—		0.76	%
Franklin Growth Fund, Class R6	22,636	8,470	(6,279	)	24,827		1,918,162		—		8,150		0.02	%
Franklin Growth Opportunities Fund,
Class R6	18,569	7,216	—		25,785		917,944		—		—		0.07	%
Franklin International Growth Fund,
Class R6	—	44,284	—		44,284		499,963		—		—		0.11	%
Franklin International Small Cap Growth
Fund, Class R6	54,504	21,182	—		75,686		1,481,926		—		—		0.08	%
Franklin K2 Alternative Strategies Fund,
Class R6	35,616	72,339	—		107,955		1,191,831		—		—		0.15	%
Franklin Low Duration Total Return Fund,
Class R6	50,687	2,789	(8,176	)	45,300		453,904		3,452		(951	)	0.02	%
Franklin Mutual International Fund,
Class R6	55,371	21,569	—		76,940		1,187,958		—		—		0.66	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	14,590	6,453	—		21,043		152,560		—		—		0.27	%
Franklin Real Estate Securities Fund,
Class R6	8,374	2,873	(2,664	)	8,583		176,119		1,396		1,506		0.03	%
Franklin Rising Dividends Fund, Class R6	21,119	8,167	(1,178	)	28,108		1,451,203		8,686		284		0.01	%
Franklin Short Duration U.S. Government
ETF	—	262	—		262		25,931		27		—		0.03	%
Franklin Small Cap Growth Fund,
Class R6	18,679	7,261	—		25,940		548,625		—		—		0.01	%
Franklin Strategic Income Fund, Class R6	17,765	1,284	(2,895	)	16,154		158,960		4,174		(2,117	)	—^a
Franklin Utilities Fund, Class R6	29,890	11,583	(3,521	)	37,952		604,953		8,721		(1,652	)	0.01	%
Institutional Fiduciary Trust Money Market
Portfolio	210,816	5,920,276	(5,853,559	)	277,533		277,533		—		—		—^a
Templeton China World Fund, Class R6	7,515	2,915	—		10,430		344,698		—		—		0.06	%
Templeton Foreign Fund, Class R6	55,339	21,460	—		76,799		553,722		—		—		0.01	%
Templeton Frontier Markets Fund,
Class R6	24,038	9,332	—		33,370		465,841		—		—		0.06	%
Templeton Global Total Return Fund,
Class R6	55,457	3,935	(9,069	)	50,323		618,464		15,246		(11,653	)	0.01	%
Total						$	16,210,805	$	41,702	$	(8,916	)
Franklin LifeSmart 2045 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	5,506	418	—		5,924	$	1,218,107	$	—	$	—		0.06	%
Franklin DynaTech Fund, Class R6	90,584	8,272	—		98,856		5,006,088		—		—		0.18	%
Franklin Emerging Market Debt Opportunities
Fund	29,285	—	—		29,285		317,157		—		—		0.04	%
Franklin Focused Core Equity Fund,
Class R6	252,084	23,653	—		275,737		4,268,416		—		—		2.56	%

franklintempleton.com Semiannual Report | ₁₅₉

FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


3. Transactions with Affiliates (continued)

f. Investments in Underlying Funds (continued)
													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2045 Retirement
Target Fund (continued)
Franklin Growth Fund, Class R6	90,526	7,379	(22,040	)	75,865	$	5,861,346	$	—	$	120,760		0.05	%
Franklin Growth Opportunities Fund,
Class R6	64,006	5,870	—		69,876		2,487,573		—		—		0.20	%
Franklin International Growth Fund,
Class R6	—	154,381	—		154,381		1,742,957		—		—		0.38	%
Franklin International Small Cap Growth
Fund, Class R6	235,498	21,512	—		257,010		5,032,265		—		—		0.27	%
Franklin K2 Alternative Strategies Fund,
Class R6	176,753	187,233	—		363,986		4,018,409		—		—		0.51	%
Franklin Low Duration Total Return Fund,
Class R6	166,721	3,693	—		170,414		1,707,544		12,061		—		0.07	%
Franklin Mutual International Fund,
Class R6	236,657	22,350	—		259,007		3,999,072		—		—		2.24	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	68,635	5,420	—		74,055		536,896		—		—		0.95	%
Franklin Real Estate Securities Fund,
Class R6	33,767	1,997	(10,486	)	25,278		518,714		4,125		62,623		0.09	%
Franklin Rising Dividends Fund, Class R6	113,043	10,766	(4,637	)	119,172		6,152,843		36,714		3,943		0.04	%
Franklin Short Duration U.S. Government
ETF	—	1,071	—		1,071		105,999		109		—		0.11	%
Franklin Small Cap Growth Fund,
Class R6	81,875	7,657	—		89,532		1,893,600		—		—		0.05	%
Franklin Strategic Income Fund, Class R6	56,796	1,392	—		58,188		572,569		13,913		—		0.01	%
Franklin Utilities Fund, Class R6	136,497	14,692	(13,856	)	137,333		2,189,082		32,216		7,123		0.04	%
Institutional Fiduciary Trust Money Market
Portfolio	1,235,172	6,095,701	(6,720,859	)	610,014		610,014		—		—		—^a
Templeton China World Fund, Class R6	34,225	2,597	—		36,822		1,216,970		—		—		0.19	%
Templeton Foreign Fund, Class R6	289,624	26,696	—		316,320		2,280,669		—		—		0.03	%
Templeton Frontier Markets Fund,
Class R6	98,152	9,431	—		107,583		1,501,855		—		—		0.19	%
Templeton Global Total Return Fund,
Class R6	178,219	6,538	—		184,757		2,270,665		51,508		—		0.03	%
Total						$	55,508,810	$	150,646	$	194,449
Franklin LifeSmart 2050 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	743	342	—		1,085	$	223,111	$	—	$	—		0.01	%
Franklin DynaTech Fund, Class R6	16,095	6,699	—		22,794		1,154,279		—		—		0.04	%
Franklin Emerging Market Debt Opportunities
Fund	4,950	774	(88	)	5,636		61,035		—		(165	)	0.01	%
Franklin Focused Core Equity Fund,
Class R6	44,752	18,785	—		63,537		983,547		—		—		0.59	%
Franklin Growth Fund, Class R6	17,201	7,061	(3,844	)	20,418		1,577,479		—		2,144		0.01	%
Franklin Growth Opportunities Fund,
Class R6	11,312	4,769	—		16,081		572,479		—		—		0.05	%

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2050 Retirement
Target Fund (continued)
Franklin International Growth Fund,
Class R6	—	26,834	—		26,834	$	302,956	$	—	$	—		0.07	%
Franklin International Small Cap Growth
Fund, Class R6	40,969	17,175	—		58,144		1,138,451		—		—		0.06	%
Franklin K2 Alternative Strategies Fund,
Class R6	27,330	56,135	—		83,465		921,460		—		—		0.12	%
Franklin Low Duration Total Return Fund,
Class R6	27,420	6,064	(514	)	32,970		330,362		2,172		(62	)	0.01	%
Franklin Mutual International Fund,
Class R6	41,571	17,523	—		59,094		912,415		—		—		0.51	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	11,112	6,083	—		17,195		124,667		—		—		0.22	%
Franklin Real Estate Securities Fund,
Class R6	5,570	2,210	(2,106	)	5,674		116,431		921		1,604		0.02	%
Franklin Rising Dividends Fund, Class R6	16,701	6,949	(931	)	22,719		1,172,994		7,019		181		0.01	%
Franklin Short Duration U.S. Government
ETF	—	232	—		232		22,961		21		—		0.02	%
Franklin Small Cap Growth Fund,
Class R6	10,925	4,868	—		15,793		334,030		—		—		0.01	%
Franklin Strategic Income Fund, Class R6	10,564	3,113	(205	)	13,472		132,561		3,046		(127	)	—^a
Franklin Utilities Fund, Class R6	22,770	9,784	(2,783	)	29,771		474,553		6,837		(1,666	)	0.01	%
Institutional Fiduciary Trust Money Market
Portfolio	152,864	4,707,386	(4,663,310	)	196,940		196,940		—		—		—^a
Templeton China World Fund, Class R6	4,093	1,845	—		5,938		196,238		—		—		0.03	%
Templeton Foreign Fund, Class R6	51,863	22,037	—		73,900		532,818		—		—		0.01	%
Templeton Frontier Markets Fund,
Class R6	16,764	7,304	—		24,068		335,989		—		—		0.04	%
Templeton Global Total Return Fund,
Class R6	28,662	6,911	(536	)	35,037		430,600		8,992		(531	)	0.01	%
Total						$	12,248,356	$	29,008	$	1,378
Franklin LifeSmart 2055 Retirement
Target Fund
Franklin Biotechnology Discovery Fund,
Class R6	—	75	—		75	$	15,400	$	—	$	—		—^a
Franklin DynaTech Fund, Class R6	—	1,598	—		1,598		80,937		—		—		—^a
Franklin Emerging Market Debt Opportunities
Fund	—	388	(39	)	349		3,777		—		—^b		—^a
Franklin Focused Core Equity Fund,
Class R6	—	4,450	—		4,450		68,885		—		—		0.04	%
Franklin Growth Fund, Class R6	—	1,703	(269	)	1,434		110,773		—		41		—^a
Franklin Growth Opportunities Fund,
Class R6	—	1,124	—		1,124		39,997		—		—		—^a
Franklin International Growth Fund,
Class R6	—	1,841	—		1,841		20,782		—		—		—^a
Franklin International Small Cap Growth
Fund, Class R6	—	4,138	—		4,138		81,016		—		—		—^a
Franklin K2 Alternative Strategies Fund,
Class R6	—	5,352	—		5,352		59,086		—		—		0.01	%

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


3. Transactions with Affiliates (continued)

f. Investments in Underlying Funds (continued)
													% of
													Underlying
	Number of				Number of								Fund Shares
	Shares Held				Shares		Value				Realized		Outstanding
	at Beginning	Gross	Gross		Held at End		at End		Investment		Gain		Held at End
Underlying Funds	of Period	Additions	Reductions		of Period		of Period		Income		(Loss)		of Period
Franklin LifeSmart 2055 Retirement
Target Fund (continued)
Franklin Low Duration Total Return Fund,
Class R6	—	2,281	(225	)	2,056	$	20,601	$	67	$	(5	)	—^a
Franklin Mutual International Fund,
Class R6	—	4,174	—		4,174		64,442		—		—		0.04	%
Franklin Pelagos Commodities Strategy Fund,
Class R6	—	1,197	—		1,197		8,680		—		—		0.02	%
Franklin Real Estate Securities Fund,
Class R6	—	399	—		399		8,179		42		—		—^a
Franklin Rising Dividends Fund, Class R6	—	1,590	—		1,590		82,104		340		—		—^a
Franklin Short Duration U.S. Government
ETF	—	20	—		20		1,979		—		—		—^a
Franklin Small Cap Growth Fund,
Class R6	—	1,111	—		1,111		23,492		—		—		—^a
Franklin Strategic Income Fund, Class R6	—	933	(92	)	841		8,274		38		(11	)	—^a
Franklin Utilities Fund, Class R6	—	2,099	—		2,099		33,463		249		—		—^a
Institutional Fiduciary Trust Money Market
Portfolio	—	162,169	(116,025	)	46,144		46,144		—		—		—^a
Templeton China World Fund, Class R6	—	421	—		421		13,923		—		—		—^a
Templeton Foreign Fund, Class R6	—	5,237	—		5,237		37,761		—		—		—^a
Templeton Frontier Markets Fund,
Class R6	—	1,699	—		1,699		23,722		—		—		—^a
Templeton Global Total Return Fund,
Class R6	—	2,432	(239	)	2,193		26,947		194		(29	)	—^a
Total						$	880,364	$	930	$	(4	)
^aRounds to less than 0.01%.
^bRounds to less than $1.

g. Waiver and Expense Reimbursements

Advisers and Investor Services have contractually agreed in advance to waive or limit their respective fees and to assume as their own expense certain expenses otherwise payable by the Funds so that the expenses (excluding distribution fees and acquired fund fees and expenses) for Class A, Class C, Class R and Advisor Class of the funds do not exceed 0.05%, and Class R6 does not exceed 0.00% based on the average net assets of each class (other than certain non-routine expenses or costs, including those relating to litigation, indemnification, reorganizations, and liquidations) until April 30, 2016.

h. Other Affiliated Transactions

At June 30, 2015, Franklin Resources, Inc. owned 93.58% of Franklin LifeSmart 2055 Retirement Target Fund’s outstanding shares. Investment activities of this shareholder could have a material impact on the Fund.

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

4. Expense Offset Arrangement

The Funds have entered into an arrangement with their custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Funds’ custodian expenses. During the period ended June 30, 2015, the custodian fees were reduced as noted in the Statements of Operations.

5. Income Taxes

For tax purposes, the Funds may elect to defer any portion of a post-October capital loss to the first day of the following fiscal year. At December 31, 2014, Franklin LifeSmart 2015 Retirement Target Fund deferred post-October capital losses of $31,208.

At June 30, 2015, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:


		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2015 Retirement			2020 Retirement			2025 Retirement
		Target Fund			Target Fund			Target Fund
Cost of investments	$	79,036,575		$	26,457,757		$	113,852,684

Unrealized appreciation	$	6,062,479		$	653,922		$	16,129,020
Unrealized depreciation		(2,755,083	)		(721,730	)		(2,430,625	)
Net unrealized appreciation (depreciation)	$	3,307,396		$	(67,808	)	$	13,698,395

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2030 Retirement			2035 Retirement			2040 Retirement
		Target Fund			Target Fund			Target Fund
Cost of investments	$	26,218,461		$	90,973,607		$	19,301,510

Unrealized appreciation	$	863,866		$	13,279,653		$	677,038
Unrealized depreciation		(751,337	)		(1,545,753	)		(482,789	)
Net unrealized appreciation (depreciation)	$	112,529		$	11,733,900		$	194,249

		Franklin			Franklin			Franklin
		LifeSmart			LifeSmart			LifeSmart
		2045 Retirement			2050 Retirement			2055 Retirement
		Target Fund			Target Fund			Target Fund
Cost of investments	$	58,532,004		$	14,440,651		$	1,061,862

Unrealized appreciation	$	8,926,125		$	551,928		$	4,353
Unrealized depreciation		(864,327	)		(351,009	)		(17,821	)
Net unrealized appreciation (depreciation)	$	8,061,798		$	200,919		$	(13,468	)

Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of short term capital gains distributions from Underlying Funds and ETFs and wash sales.

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FRANKLIN FUND ALLOCATOR SERIES
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

6. Investment Transactions

Purchases and sales of Underlying Funds and ETFs (excluding short term securities) for the period ended June 30, 2015, were as follows:


		Franklin		Franklin		Franklin		Franklin		Franklin
		LifeSmart		LifeSmart		LifeSmart		LifeSmart		LifeSmart
		2015 Retirement		2020 Retirement		2025 Retirement		2030 Retirement		2035 Retirement
		Target Fund		Target Fund		Target Fund		Target Fund		Target Fund
Purchases	$	5,457,584	$	10,957,355	$	13,780,482	$	11,135,107	$	12,251,280
Sales	$	5,562,589	$	2,070,994	$	4,769,657	$	4,413,103	$	4,535,173

				Franklin		Franklin		Franklin		Franklin
				LifeSmart		LifeSmart		LifeSmart		LifeSmart
				2040 Retirement		2045 Retirement		2050 Retirement		2055 Retirement
				Target Fund		Target Fund		Target Fund		Target Fund
Purchases			$	6,743,945	$	8,388,229	$	4,989,418	$	1,063,938
Sales			$	1,433,610	$	2,634,911	$	583,011	$	49,040

7. Credit Facility

The Funds, except Franklin LifeSmart 2055 Retirement Target Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton Investments, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 12, 2016. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.

Under the terms of the Global Credit Facility, the Funds shall, in addition to interest charged on any borrowings made by the Funds and other costs incurred by the Funds, pay their share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon their relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.07% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statements of Operations. During the period ended June 30, 2015, the Funds did not use the Global Credit Facility.

8. Fair Value Measurements

The Funds follow a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Funds’ own market assumptions (unobservable inputs). These inputs are used in determining the value of the Funds’ financial instruments and are summarized in the following fair value hierarchy:

Level 1 – quoted prices in active markets for identical financial instruments
Level 2 – other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.)
Level 3 – significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of financial instruments)

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

For movements between the levels within the fair value hierarchy, the Funds have adopted a policy of recognizing the transfers as of the date of the underlying event which caused the movement.

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NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

At June 30, 2015, all of the Funds’ investments in financial instruments carried at fair value were valued using Level 1 inputs.

For detailed categories, see the accompanying Statements of Investments.

9. Subsequent Events

The Funds have evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure other than those already disclosed in the financial statements.

Abbreviations

Selected Portfolio

ETF Exchange Traded Fund

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Shareholder Information

Board Review of Investment Management Agreement

At a meeting held February 24, 2015, the Board of Trustees, including a majority of non-interested or independent Trustees, approved renewal of the investment management and asset allocation agreement (investment management agreement) for each of the separate funds in Franklin Fund Allocator Series (Fund(s)). In reaching its decision to approve renewal of the investment management agreements, the Board took into account information furnished throughout the year at regular Board meetings, as well as information prepared specifically in connection with the annual renewal review process. Information furnished and discussed throughout the year included investment performance reports and related financial information for each Fund, along with periodic reports on expenses, shareholder services, legal and compliance matters, pricing, brokerage commissions and execution and other services provided by the Investment Manager (Manager) and its affiliates, as well as marketing support payments made to financial intermediaries. Information furnished specifically in connection with the renewal process included a report for each Fund prepared by Lipper, Inc. (Lipper), an independent organization, as well as additional material, including a Fund profitability analysis prepared by management. The Lipper reports compared each Fund’s investment performance and expenses with those of other mutual funds deemed comparable to the Fund as selected by Lipper. The Fund profitability analysis discussed the profitability to Franklin Templeton Investments (FTI) from its overall U.S. fund operations, as well as on an individual fund-by-fund basis. Additional material accompanying such profitability analysis included information on a fund-by-fund basis listing portfolio managers and other accounts they manage, as well as information on management fees charged by the Manager and its affiliates to U.S. mutual funds and other accounts, including management’s explanation of differences where relevant. Such material also included a memorandum prepared by management describing project initiatives and capital investments relating to the services provided to the Funds by the FTI organization, as well as a memorandum relating to economies of scale and an analysis concerning transfer agent fees charged by an affiliate of the Manager. The Board also noted that at the February meetings each year, it receives an annual report on all marketing support payments made by FTI to financial intermediaries.

In considering such materials, the independent Trustees received assistance and advice from and met separately with independent counsel. While the investment management agreements for all Funds were considered at the same Board meeting, the Board dealt with each Fund separately. In approving continuance of the investment management agreement for each Fund, the Board, including a majority of independent Trustees, determined that the existing fee structure was fair and reasonable and that continuance of the investment management agreement was in the best interests of each Fund and its shareholders. While attention was given to all information furnished, the following discusses some primary factors relevant to the Board’s decision.

NATURE, EXTENT AND QUALITY OF SERVICE. The Board was generally satisfied with the nature and quality of the overall services provided by the Manager and its affiliates to the Funds and their shareholders. In addition to investment performance and expenses discussed later, the Board’s opinion was based, in part, upon periodic reports furnished it showing that the investment policies and restrictions for each Fund were consistently complied with as well as other reports periodically furnished the Board covering matters such as the compliance of portfolio managers and other management personnel with the code of ethics adopted throughout the Franklin Templeton fund complex, the adherence to fair value pricing procedures established by the Board, and the accuracy of net asset value calculations. The Board also noted the extent of benefits provided Fund shareholders from being part of the Franklin Templeton family of funds, including the right to exchange investments between the same class of shares of different funds without a sales charge, the ability to reinvest Fund dividends into other funds and the right to combine holdings in other funds to obtain a reduced sales charge. Favorable consideration was given to management’s continual efforts and expenditures in establishing effective business continuity plans and developing strategies to address cybersecurity threats. Among other factors taken into account by the Board were the Manager’s best execution trading policies, including a favorable report by an independent portfolio trading analytical firm that also covered FOREX transactions. Consideration was also given to the experience of each Fund’s portfolio management team, the number of accounts managed and general method of compensation. In this latter respect, the Board noted that a primary factor in management’s determination of a portfolio manager’s bonus compensation was the relative investment performance of the funds he or she managed and that a portion of such bonus was required to be invested in a predesignated list of funds within such person’s fund management area so as to be aligned with the interests of shareholders. The Board also took into account the quality of transfer agent and shareholder services provided Fund shareholders by an affiliate of the Manager noting the changes taking place in the nature of transfer agency

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SHAREHOLDER INFORMATION

services throughout the industry and regulatory initiatives in this area, and the continual enhancements to the Franklin Templeton website. Particular attention was given to management’s conservative approach and diligent risk management procedures, including continual monitoring of counterparty credit risk and attention given to derivatives and other complex instruments including expanded collateralization requirements. The Board also took into account, among other things, management’s efforts in establishing a global credit facility for the benefit of the Funds and other accounts managed by FTI to provide a source of cash for temporary and emergency purposes or to meet unusual redemption requests as well as the strong financial position of the Manager’s parent company and its commitment to the mutual fund business as evidenced by its continued subsidization of money market funds.

INVESTMENT PERFORMANCE. The Board placed significant emphasis on the investment performance of each Fund in view of its importance to shareholders. While consideration was given to performance reports and discussions with portfolio managers at Board meetings throughout the year, particular attention in assessing performance was given to the Lipper reports furnished for the agreement renewals. The Lipper reports prepared for each individual Fund showed the investment performance of its Class A shares, in comparison to a performance universe selected by Lipper. Comparative performance for each Fund was shown for the one-year period ended December 31, 2014, and for additional periods ended that date depending on when a particular Fund commenced operations. The following summarizes the performance results for each of the Funds and the Board’s view of such performance. The Board observed that the performance of a number of the Funds was impacted by their respective allocations to global markets and currencies, as well as U.S. fixed income. These allocations, while consistent with the Funds’ longer term perspectives, were detrimental to short-term returns and comparisons to peers.

Franklin LifeSmart 2015 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2015 funds as selected by Lipper. The Fund has been in operation for less than 10 years and the Lipper report showed its 2014 total return to be in the lowest performing quintile of its performance universe, and its total return on an annualized basis to be in the second-lowest performing quintile of such universe for the previous three- and five-year periods. The Board noted that the Fund’s performance reflects that of the funds in which it invests, and discussed with management the allocations to these funds. The Board found the performance of the Fund to be acceptable, in view of management’s explanations.

Franklin LifeSmart 2020 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2020 funds as selected by Lipper. The Fund has been in operation for less than two years and the Lipper report showed its 2014 total return to be in the middle performing quintile of its performance universe. The Board was satisfied with the comparative performance of the Fund as shown in the Lipper report, particularly given its short period of operation.

Franklin LifeSmart 2025 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2025 funds as selected by Lipper. The Fund has been in operation for less than 10 years and the Lipper report showed its 2014 total return to be in the second-lowest performing quintile of its performance universe, and on an annualized basis to be in the middle performing quintile of such universe for the previous three- and five-year periods. The Board found the comparative performance of the Fund as shown in the Lipper report to be acceptable.

Franklin LifeSmart 2030 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2030 funds as selected by Lipper. The Fund has been in operation for less than two years and the Lipper report showed its 2014 total return to be in the middle performing quintile of its performance universe. The Board was satisfied with the comparative performance of the Fund as shown in the Lipper report, particularly given its short period of operation.

Franklin LifeSmart 2035 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2035 funds as selected by Lipper. The Fund has been in operation for less than 10 years and the Lipper report showed its 2014 total return to be in the second-lowest performing quintile of its performance universe and its total return on an annualized basis to be in the second-lowest performing quintile of such performance universe during the previous three- and five-year periods. The Board, noting that the Fund’s performance reflected that of its underlying funds, found the Fund’s overall comparative performance as set forth in the Lipper report to be acceptable.

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SHAREHOLDER INFORMATION

Board Review of Investment Management

Agreement (continued)

Franklin LifeSmart 2040 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2040 funds as selected by Lipper. The Fund has been in operation for less than two years and the Lipper report showed its 2014 total return to be in the middle performing quintile of such universe. The Board was satisfied with the comparative performance of the Fund as shown in the Lipper report, particularly given its short period of operation.

Franklin LifeSmart 2045 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2045 funds as selected by Lipper. The Fund has been in operation for less than 10 years and the Lipper report showed the Fund’s 2014 total return to be in the second-lowest performing quintile of its performance universe and its total return on an annualized basis to be in the lowest quintile of such universe for the previous three-year period, and to be in the second-lowest performing quintile of such universe for the previous five-year period. The Board found the Fund’s overall comparative performance as set forth in the Lipper report to be acceptable and noted that the Fund’s annualized three-year return as shown in such report exceeded 12%.

Franklin LifeSmart 2050 Retirement Target Fund – The performance universe for this Fund consisted of the Fund and all retail and institutional mixed-asset target 2050 funds as selected by Lipper. The Fund has been in operation for less than two years and the Lipper report showed its 2014 total return to be in the middle performing quintile of such universe. The Board was satisfied with the comparative performance of the Fund as shown in the Lipper report, particularly given its short period of operation.

COMPARATIVE EXPENSES. Consideration was given to the fee and total expense ratio of each Fund compared with those of a group of retail front-end load fund of funds selected by Lipper as its appropriate Lipper expense group. Lipper expense data is based upon information taken from each such fund’s most recent annual report, which reflects historical asset levels that may be quite different from those currently existing, particularly in a period of market volatility. While recognizing such inherent limitation and the fact that expense ratios generally increase as assets decline and decrease as assets grow, the Board believed the independent analysis conducted by Lipper to be an appropriate measure of comparative expenses. In reviewing comparative costs, Lipper provides information on each Fund’s contractual fee under the investment management agreement in comparison with the contractual investment management fee that would have been charged by other funds within its Lipper expense group assuming they were similar in size to the Fund, as well as the actual total expense ratios of the Funds, including expenses of the underlying funds they invest in. The Lipper contractual investment management fee analysis includes the administrative fee and asset allocation advisory fee directly charged to the Funds as being part of the contractual investment management fee, with the investment management fees charged underlying funds being included within actual total expenses. Contractual investment management fees and total expenses for comparative consistency are shown by Lipper for Fund Class A shares. The Board noted that the Funds pay an asset allocation advisory fee. The Lipper reports for Franklin LifeSmart 2015 Retirement Target Fund and Franklin LifeSmart 2035 Retirement Target Fund showed that their contractual management fee rates were five and approximately three basis points, respectively, above their Lipper expense group medians. The Lipper reports for Franklin LifeSmart 2020 Retirement Target Fund and Franklin LifeSmart 2030 Retirement Target Fund showed in each case that their contractual management fee rates were five basis points below their respective Lipper group medians. The Lipper reports for Franklin LifeSmart 2025 Retirement Target Fund, Franklin LifeSmart 2040 Retirement Target Fund, Franklin LifeSmart 2045 Retirement Target Fund and Franklin LifeSmart 2050 Retirement Target Fund showed in each case that their contractual management fee rates were at the median. With the exception of Franklin LifeSmart 2020 Retirement Target Fund, the actual total expense ratios of all of the LifeSmart Retirement Target Funds were below their respective Lipper group medians. The Board found the comparative expenses of these Funds as shown in the Lipper report to be acceptable, noting that in each case such expenses were being subsidized by fee waivers.

MANAGEMENT PROFITABILITY. The Board also considered the level of profits realized by the Manager and its affiliates in connection with the operation of each Fund. In this respect, the Board reviewed the Fund profitability analysis that addresses the overall profitability of Franklin Templeton’s U.S. fund business, as well as its profits in providing management and other services to each of the individual funds during the 12-month period ended September 30, 2014, being the most recent fiscal year-end for Franklin Resources, Inc., the Manager’s parent. In reviewing the analysis, the Board recognized that allocation methodologies are inherently subjective and various allocation methodologies may be reasonable

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while producing different results. In this respect, the Board noted that while management continually makes refinements to its methodologies in response to organizational and product related changes, the overall approach as defined by the primary drivers and activity measurements has remained consistent with that used in the Funds’ profitability report presentations from prior years. Additionally, the Funds’ independent registered public accounting firm had been engaged by the Manager to periodically review the reasonableness of the allocation methodologies to be used solely by the Funds’ Board in reference to the profitability analysis. In reviewing and discussing such analysis, management discussed with the Board its belief that costs incurred in establishing the infrastructure necessary for the type of mutual fund operations conducted by the Manager and its affiliates may not be fully reflected in the expenses allocated to each Fund in determining its profitability, as well as the fact that the level of profits, to a certain extent, reflected operational cost savings and efficiencies initiated by management. The Board also took into account management’s expenditures in improving shareholder services provided the Funds, as well as the need to implement systems and meet additional regulatory and compliance requirements resulting from statutes such as the Sarbanes-Oxley and Dodd-Frank Acts and recent SEC and other regulatory requirements. In addition, the Board considered a third-party study comparing the profitability of the Manager’s parent on an overall basis to other publicly held managers broken down to show profitability from management operations exclusive of distribution expenses, as well as profitability including distribution expenses. The Board also considered the extent to which the Manager and its affiliates might derive ancillary benefits from fund operations, including revenues generated from transfer agent services and potential benefits resulting from personnel and systems enhancements necessitated by Fund growth, as well as increased leverage with the service providers and counterparties. Based upon its consideration of all these factors, and taking into account the fact that Fund expenses were being subsidized through fee waivers, the Board determined that the level of profits realized by the Manager and its affiliates from providing services to each Fund was not excessive in view of the nature, quality and extent of services provided.

ECONOMIES OF SCALE. The Board also considered whether economies of scale are realized by the Manager as the Funds grow larger and the extent to which this is reflected in the level of management fees charged. While recognizing that any precise determination is inherently subjective, the Board

noted that based upon the Fund profitability analysis, it appears that as some funds get larger, at some point economies of scale do result in the Manager realizing a larger profit margin on management services provided such a fund. The Board also noted that economies of scale are shared with a fund and its shareholders through management fee breakpoints so that as a fund grows in size, its effective management fee rate declines. The management fees charged by all or substantially all the underlying funds in which the Funds invest provide for such management fee breakpoints. Consequently, to the extent economies of scale may be realized by the investment managers of these funds, the benefits are shared with each Fund and its shareholders through a reduction in actual total expense ratios.

Board Review of Investment Management and Asset Allocation Agreement

Franklin Lifesmart 2055 Retirement Target Fund

At a meeting held December 4, 2014, the Board of Trustees (Board), including a majority of non-interested or independent Trustees, approved the investment management and asset allocation agreement for Franklin LifeSmart 2055 Retirement Target Fund (Fund), a series of Franklin Fund Allocator Series (Trust). In reaching its decision to approve the agreement, the Board took into account that the Fund is an extension of the Trust’s suite of retirement target date funds (currently composed of eight funds with five-year intervals of target dates from 2015 to 2050) and is structured similarly to such other retirement target date funds. The Fund will have the same general investment goal, principal investment policies, eligible underlying funds, service provider arrangements and other key factors as the current funds but will have a different glide path allocation consistent with the retirement target date of 2055 indicated in the Fund’s name. The Board considered various materials related to the investment management and asset allocation agreement including: (1) a copy of the proposed form of agreement; (2) information describing the nature, quality and extent of services to be provided by the Manager, and the proposed fees payable to the Manager for such services; (3) a report from the Fund’s Chief Compliance Officer regarding the Manager’s compliance program and capabilities, including policies and procedures in place to address potential conflicts of interest, which the Board had reviewed in connection with its consideration of previous retirement date funds. The Board also was provided with information relating to proposed expenses for the Fund, including comparative data

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Board Review of Investment Management and Asset Allocation Agreement (continued)

provided by Lipper, Inc. (Lipper), an independent organization, which compared the expenses to those of other mutual funds deemed comparable to the Fund as selected by Lipper.

In determining that the terms of the proposed agreement were fair and reasonable, the Board took into account several factors including, but not limited to, the following: (1) the nature and quality of the services to be provided by the Manager to the Fund under the proposed agreement; (2) the Manager’s experience as a manager of similar funds and accounts, including those within the FTI complex and the Trust; (3) the Manager’s strength and reputation within the industry; (4) the fairness of the compensation under the proposed agreement; (5) the comparative pricing structure (including the estimated expense ratio to be borne by shareholders) of the Fund; (6) the personnel, operations, financial condition, and investment management capabilities, methodologies and resources of the Manager; (7) profitability matters; and (8) the Manager’s compliance capabilities, as demonstrated by, among other things, its policies and procedures designed to prevent violations of the federal securities laws, which had previously been approved by the Board in connection with its oversight of other funds in the FTI complex. In considering such materials, the independent Trustees received assistance and advice from and met separately with independent counsel.

The following sets forth some of the primary information and factors relevant to the Board’s decision to approve the agreement. This discussion of the information and factors considered by the Board (including the information and factors discussed above) is not intended to be exhaustive, but rather summarizes certain factors considered by the Board. In view of the wide variety of factors considered, the Board did not, unless otherwise noted, find it practicable to quantify or otherwise assign relative weights to the foregoing factors. In addition, individual Trustees may have assigned different weights to various factors.

NATURE, EXTENT AND QUALITY OF SERVICES. The Board reviewed the nature, extent and quality of the services to be provided by the Manager. In this regard, they reviewed the Fund’s proposed investment goal and the Manager’s proposed investment strategy and ability to implement such investment strategy, including, but not limited to, the Manager’s trading practices and investment decision processes. The Board

reviewed the Fund’s portfolio managers, including their performance, staffing, skills and compensation program and considered similar products advised by the Manager and their relative fees and reasons for differences with respect thereto and any potential conflicts. They also considered the nature, extent and quality of the services to be provided under the other service agreements with affiliates of the Manager. Based on its review, the Board was satisfied with the nature and quality of the overall services to be provided by the Manager and its affiliates to the Fund and its shareholders and was confident in the abilities of the Manager to implement its proposed investment strategy and to provide quality services to the Fund and its shareholders.

INVESTMENT PERFORMANCE. The Board noted that, as the Fund had not yet commenced investment operations, there was no investment performance for the Fund. As noted earlier, the Board did consider the investment performance of the Manager in managing similar funds within the Trust, each with similar investment goals to the investment goals of the Fund. The Board also considered the proposed performance benchmarks for the Fund and how such benchmarks were selected by the Manager and would be utilized to measure performance of the Manager.

COMPARATIVE EXPENSES AND PROFITABILITY.

The Board considered the cost of the services to be provided and the profits to be realized by the Manager (and its affiliates) from its respective relationships with the Fund. The Board noted that the Manager and its affiliates could not report any financial results from their relationships with the Fund because the Fund had not yet commenced investment operations, and thus, the Board could not evaluate the Manager’s or its affiliates’ profitability with respect to the Fund. The Board considered that the Manager will provide general investment management and administrative services, including asset allocation services, to the Fund for a monthly fee equal to an annual rate of 0.25% of the average daily net assets of the Fund. It is not anticipated that the Fund will generate significant, if any, profit for the Manager and/or its affiliates for some time. In considering the appropriateness of the investment management and asset allocation fee to be charged to the Fund, the Board reviewed and considered the nature, extent and quality of the overall investment management services expected to be provided by the Manager, as more fully discussed above. The Board considered various other funds that are advised by the Manager and their relative fees and reasons for differences, if any, with

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respect thereto and any potential conflicts. The Board considered the extent to which the Manager may derive ancillary benefits from Fund operations. Consideration was also given to the information provided by Lipper on other asset allocation funds in the Lipper data (the Comparable Funds) and that the Manager’s asset allocation fee is below the management fee charged by Comparable Funds. The Board also noted that the expected total expenses (both including and excluding the proposed fee waiver and expense limitation arrangements) of the Fund were within the range of or below the total expenses of the Comparable Funds (both including and excluding their proposed fee waiver and expense limitation arrangements). Based upon its consideration of all these factors, the Board determined that the investment management fee structure was fair and reasonable.

ECONOMIES OF SCALE. The Board considered economies of scale that may be realized by the Manager and its affiliates as the Fund grows larger and the extent to which they are shared with Fund shareholders. Because the Fund had not yet commenced operations, the Board concluded that economies of scale were difficult to consider at this time.

Proxy Voting Policies and Procedures

The Trust’s investment manager has established Proxy Voting Policies and Procedures (Policies) that the Trust uses to determine how to vote proxies relating to portfolio securities. Shareholders may view the Trust’s complete Policies online at franklintempleton.com. Alternatively, shareholders may request copies of the Policies free of charge by calling the Proxy Group collect at (954) 527-7678 or by sending a written request to: Franklin Templeton Companies, LLC, 300 S.E. 2nd Street, Fort Lauderdale, FL 33301, Attention: Proxy Group. Copies of the Trust’s proxy voting records are also made available online at franklintempleton.com and posted on the U.S. Securities and Exchange Commission’s website at sec.gov and reflect the most recent 12-month period ended June 30.

Quarterly Statement of Investments

The Trust files a complete statement of investments with the U.S. Securities and Exchange Commission for the first and third quarters for each fiscal year on Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission’s website at sec.gov. The filed form may also be viewed and copied at the Commission’s Public Reference Room in Washington, DC. Information regarding the operations of the Public Reference Room may be obtained by calling (800) SEC-0330.

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Item 2. Code of Ethics.

(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.

(d) N/A

(f) Pursuant to Item 12(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.

Item 3. Audit Committee Financial Expert.

(a)(1) The Registrant has an audit committee financial expert serving on its audit committee.

(2) The audit committee financial expert is John B. Wilson and he is "independent" as defined under the relevant Securities and Exchange Commission Rules and Releases.

Item 4. Principal Accountant Fees and Services. N/A

Item 5. Audit Committee of Listed Registrants. N/A

Item 6. Schedule of Investments. N/A

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. N/A

Item 8. Portfolio Managers of Closed-End Management Investment Companies. N/A

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. N/A

Item 10. Submission of Matters to a Vote of Security Holders.

There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant's Board of Trustees that would require disclosure herein.

Item 11. Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures. The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures. Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.

(b) Changes in Internal Controls. There have been no changes in the Registrant’s internal controls or in other factors that could materially affect the internal controls over financial reporting subsequent to the date of their evaluation in connection with the preparation of this Shareholder Report on Form N-CSR.

Item 12. Exhibits.

(a)(1) Code of Ethics

(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer

(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and Gaston Gardey, Chief Financial Officer and Chief Accounting Officer

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

FRANKLIN FUND ALLOCATOR SERIES

By /s/Laura F. Fergerson

Laura F. Fergerson

Chief Executive Officer - Finance and Administration

Date August 27, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By /s/Laura F. Fergerson

Laura F. Fergerson

Chief Executive Officer - Finance and Administration

Date August 27, 2015

By /s/Gaston Gardey

Gaston Gardey

Chief Financial Officer and Chief Accounting Officer

Date August 27, 2015

Franklin Corefolio Allocation Fund Class C (FTCLX) N-CSRSCertified semi-annual shareholder report (management investment company)