UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-05742
Name of Fund: BlackRock Funds
BlackRock Money Market Portfolio
BlackRock Municipal Money Market Portfolio
BlackRock New Jersey Municipal Money Market Portfolio
BlackRock North Carolina Municipal Money Market Portfolio
BlackRock Ohio Municipal Money Market Portfolio
BlackRock Pennsylvania Municipal Money Market Portfolio
BlackRock U.S. Treasury Money Market Portfolio
BlackRock Virginia Municipal Money Market Portfolio
Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809
Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Funds, 55 East 52nd
Street, New York, NY 10055
Registrant’s telephone number, including area code: (800) 441-7762
Date of fiscal year end: 03/31/2013
Date of reporting period: 09/30/2012
Item 1 – Report to Stockholders
2
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 | | September 30, 2012 |
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Semi-Annual Report (Unaudited) |
BlackRock FundsSM
u BlackRock Money Market Portfolio
u BlackRock U.S. Treasury Money Market Portfolio
u BlackRock Municipal Money Market Portfolio
u BlackRock New Jersey Municipal Money Market Portfolio
u BlackRock North Carolina Municipal Money Market Portfolio
u BlackRock Ohio Municipal Money Market Portfolio
u BlackRock Pennsylvania Municipal Money Market Portfolio
u BlackRock Virginia Municipal Money Market Portfolio
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| | Not FDIC Insured § No Bank Guarantee § May Lose Value | | |
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| 2 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
Dear Shareholder
Late in the summer of 2011, financial markets were upended by sovereign debt turmoil in the United States and Europe as well as growing concerns about the future of the global economy. Investor confidence had crumbled. However, the fourth quarter of 2011 brought improving economic data and more concerted efforts among European leaders toward stemming the region’s debt crisis, gradually drawing investors back to the markets. Improving sentiment carried over into early 2012 as investors felt some relief from the world’s financial woes. Volatility abated and risk assets (including stocks, commodities and high yield bonds) moved boldly higher through the first two months of 2012, while climbing Treasury yields pressured higher-quality fixed income assets.
Markets reversed course in the spring when Europe’s debt problems boiled over once again. High levels of volatility returned as political instability in Greece threatened the country’s membership in the eurozone. Spain faced severe deficit issues while the nation’s banks clamored for liquidity. Yields on Spanish and Italian government debt rose to levels deemed unsustainable. European leaders conferred and debated vehemently over the need for fiscal integration among the 17 nations comprising the euro currency bloc as a means to resolve the crisis for the long term.
Alongside the drama in Europe, investors were discouraged by gloomy economic reports from various parts of the world. A slowdown in China, a key powerhouse for global growth, became particularly worrisome. In the United States, disappointing jobs reports dealt a crushing blow to investor sentiment. Risk assets sold off in the second quarter as investors again retreated to safe haven assets.
Despite ongoing concerns about the health of the global economy and the debt crisis in Europe, most asset classes enjoyed a robust summer rally powered mainly by expectations for policy stimulus from central banks in Europe and the United States. Although global economic data continued to be mixed, the spate of downside surprises seen in the second quarter had receded and, outside of Europe, the risk of recession largely subsided. Additionally, in response to growing debt pressures, the European Central Bank allayed investors’ fears by stating its conviction to hold the eurozone together. Early in September, the European Central Bank announced a plan to purchase sovereign debt in the eurozone’s most troubled nations. Later that month, the US Federal Reserve announced its long-awaited - and surprisingly aggressive – stimulus program, committing to purchase $40 billion of agency mortgage-backed securities per month until the US economy exhibits enough strength to sustain real growth and improving labor market conditions. These central bank actions boosted risk assets globally as investors increased their risk appetites in their search for higher returns.
All asset classes performed well for the 12-month period ended September 30, 2012, with particularly strong returns from US stocks and high yield bonds. For the six-month period ended September 30, 2012, fixed income investments outperformed equities. US Treasury bonds posted exceptional gains by historical standards and outperformed investment-grade corporate bonds and tax-exempt municipals. High yield bonds also generated solid returns. US stocks finished the six-month period with modest gains, while international and emerging market stocks lagged other asset classes amid ongoing uncertainty. Near-zero short term interest rates continued to keep yields on money market securities near their all-time lows.
The financial world is more uncertain than ever, but there are new avenues of opportunity – new ways to invest and new markets in which to invest. We believe it’s our responsibility to help investors adapt to today’s new world of investing and build the portfolios these times require. We encourage you to visit www.blackrock.com/newworld for more information.
Sincerely,
Rob Kapito
President, BlackRock Advisors, LLC
“The financial world is more uncertain than ever, but there are new avenues of opportunity.”
Rob Kapito
President, BlackRock Advisors, LLC
Total Returns as of September 30, 2012
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| | | 6-month | | | 12-month | |
US large cap equities (S&P 500® Index) | | | 3.43 | % | | | 30.20 | % |
US small cap equities (Russell 2000® Index) | | | 1.60 | | | | 31.91 | |
International equities (MSCI Europe, Australasia, Far East Index) | | | (0.70 | ) | | | 13.75 | |
Emerging market equities (MSCI Emerging Markets Index) | | | (1.84 | ) | | | 16.93 | |
3-month Treasury bill (BofA Merrill Lynch 3-Month US Treasury Bill Index) | | | 0.06 | | | | 0.07 | |
US Treasury securities (BofA Merrill Lynch 10- Year US Treasury Index) | | | 6.78 | | | | 5.66 | |
US investment grade bonds (Barclays US Aggregate Bond Index) | | | 3.68 | | | | 5.16 | |
Tax-exempt municipal bonds (S&P Municipal Bond Index) | | | 4.50 | | | | 8.84 | |
US high yield bonds (Barclays US Corporate High Yield 2% Issuer Capped Index) | | | 6.40 | | | | 19.35 | |
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.
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| | THIS PAGE NOT PART OF YOUR FUND REPORT | | | | 3 |
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For the 6-month period ended September 30, 2012 |
The Federal Open Market Committee (“FOMC”) continued to maintain its target range for the federal funds rate at 0.00% to 0.25% throughout the six-month reporting period ended September 30, 2012. During the period, policymakers stated that they anticipate exceptionally low short-term rates will be warranted at least through mid-2015.
On the heels of a second successful long-term refinancing operation (“LTRO”) from the European Central Bank (“ECB”) in February, credit markets rallied during the start of the period before trending sideways. Money markets began to take pause in late May as Moody’s Investors Services rating agency neared completion of its large-scale review of banks placed on watch for potential downgrade, including 114 banks in 16 European countries as well as 17 other major banks and securities firms around the world that engage in global capital markets operations. As Moody’s provided a host of guidance on the pending actions over the course of its review, there was little in the way of surprise when the agency announced the results in June.
In late June, the FOMC announced the extension of the program known as “Operation Twist” through the end of 2012, with plans to sell an additional $267 billion of short-dated US Treasury securities while purchasing an equal amount of longer-dated Treasury notes. As primary market dealers are obligated to participate in the FOMC’s policy programs, Operation Twist has resulted in many dealers being forced to retain short-dated Treasury securities sold by the US Federal Reserve on their balance sheets, driving up funding costs for these positions. Dealers have relied upon overnight repurchase agreements (“repos”) in order to finance the Treasury securities, to the benefit of short-term investors who have seen repo rates nearly double this year. So it follows that Operation Twist has led to a direct increase in short-term US Treasury yields. Three-month US Treasury bill yields, for instance, averaged 0.088% over the six months ended September 2012, in contrast to an average yield of 0.035% in the previous six-month period.
As the eurozone gradually moves toward fiscal integration, economies across the region face severe headwinds. Unemployment rates have been hovering near historical highs and sovereign bond prices in peripheral countries have been volatile and altogether weak. In July, the ECB cut the main refinancing rate to 0.75%. The central bank also cut its deposit rate from 0.25% to zero to encourage euro area banks to originate new loans rather than leave idle balances on reserve at the central bank. In early September, the ECB announced a bold new sovereign bond-buying plan aimed at lowering short-term financing costs for the region’s most troubled countries subject to stringent conditions set forth under the program.
In the United States, sluggish economic growth and stubbornly high unemployment prompted the FOMC to launch another round of stimulus in mid-September. The FOMC committed to purchasing approximately $40 billion of agency mortgage-backed securities (“MBS”) per month until the US labor market exhibits substantial improvement. The FOMC will continue to reinvest principal from their existing holdings of agency MBS, bringing total monthly purchases to nearly $85 billion. Since the onset of the crisis in September 2008, the US Federal Reserve has nearly tripled its balance sheet to $2.8 trillion.
Taken together, central bank actions have eased liquidity strains in the funding markets. In fact, many issuers are fully funded through the end of 2012. During the six-month period, credit spreads compressed and US dollar London Interbank Offered Rates (“LIBOR”) moved lower across the curve. The sharpest drop came in the three-month LIBOR, which fell 11 basis points over the period to 0.359% as of September 30, 2012.
In the short-term tax-exempt market, yields rose steadily leading up to the April 15th tax filing deadline, and declined throughout the summer months due to strong cash inflows resulting from the reinvestment of bond coupon payments and maturities. This is a typical seasonal pattern for yields as increasing demand for variable rate demand notes (“VRDNs”) meets a decreasing-supply environment at this time of year. The benchmark Securities Industry and Financial Markets Association (“SIFMA”) Index, which represents the average rate on seven-day, high-quality VRDN securities (as calculated by Municipal Market Data), reached a year-to-date high of 0.26% on April 18th and ended the period at 0.18% as of September 30, 2012.
As the FOMC’s easy monetary policy has kept rates on taxable overnight repos low by historical measures, demand for VRDN securities from taxable money funds continued to be strong in 2012. This put additional supply pressures on an already shrinking VRDN market and allowed the dealer community to maintain yields on VRDNs that continue to attract crossover buyers from the taxable market.
As state and local municipalities continue to limit spending and reduce debt, new-issue supply of one-year, fixed-rate notes remained diminished in 2012. Municipalities began their annual issuance of one-year notes in June. Generally speaking, municipal money market funds take advantage of “note season” to extend their weighted average maturity, pick up yield, and diversify beyond bank exposure. The municipal yield curve continued to be extremely flat with longer-dated one-year municipal notes yielding 0.22% as of September 30, 2012, representing only a nominal premium for the extension risk over VRDNs.
Tax-exempt money fund industry assets, although down 5.7% for the six-month period ended September 30, 2012, stabilized in the third quarter, at $268 billion.
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.
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| 4 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
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Fund Information as of September 30, 2012 | | |
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| BlackRock Money Market Portfolio |
BlackRock Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income as is consistent with maintaining liquidity and stability of principal.
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| Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
Investor B | | | | 0.00 | % | | | | 0.00 | % |
Investor C | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Commercial Paper | | | | 37 | % |
Certificates of Deposit | | | | 32 | |
U.S. Treasury Obligations | | | | 10 | |
Municipal Bonds | | | | 8 | |
U.S. Government Sponsored Agency Obligations | | | | 6 | |
Repurchase Agreements | | | | 4 | |
Corporate Notes | | | | 2 | |
Closed-End Investment Companies | | | | 1 | |
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Total | | | | 100 | % |
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| BlackRock U.S. Treasury Money Market Portfolio |
BlackRock U.S. Treasury Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income as is consistent with maintaining liquidity and stability of principal.
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| Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Repurchase Agreements | | | | 50 | % |
U.S. Treasury Obligations | | | | 50 | |
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Total | | | | 100 | % |
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| BlackRock Municipal Money Market Portfolio |
BlackRock Municipal Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income exempt from Federal income tax as is consistent with maintaining liquidity and stability of principal.
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Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Variable Rate Demand Notes | | | | 78 | % |
Municipal Bonds | | | | 15 | |
Municipal Put Bonds | | | | 1 | |
Commercial Paper | | | | 6 | |
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Total | | | | 100 | % |
| | | The 7-Day SEC Yields may differ from the 7-Day Yields shown above due to the fact that the 7-Day SEC Yields exclude distributed capital gains. Past performance is not indicative of future results. |
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| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 5 |
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Fund Information (continued) as of September 30, 2012 | | |
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| BlackRock New Jersey Municipal Money Market Portfolio |
BlackRock New Jersey Municipal Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income exempt from Federal income tax and, to the extent possible, New Jersey state income tax, as is consistent with maintaining liquidity and stability of principal.
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Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Variable Rate Demand Notes | | | | 84 | % |
Municipal Bonds | | | | 16 | |
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Total | | | | 100 | % |
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| BlackRock North Carolina Municipal Money Market Portfolio |
BlackRock North Carolina Municipal Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income exempt from Federal income tax and, to the extent possible, North Carolina state income tax, as is consistent with maintaining liquidity and stability of principal.
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Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Variable Rate Demand Notes | | | | 88 | % |
Municipal Bonds | | | | 10 | |
Other Assets Less Liabilities | | | | 2 | |
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Total | | | | 100 | % |
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| BlackRock Ohio Municipal Money Market Portfolio |
BlackRock Ohio Municipal Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income exempt from Federal income tax and, to the extent possible, Ohio state income tax, as is consistent with maintaining liquidity and stability of principal.
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Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Variable Rate Demand Notes | | | | 72 | % |
Municipal Bonds | | | | 28 | |
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Total | | | | 100 | % |
| | | The 7-Day SEC Yields may differ from the 7-Day Yields shown above due to the fact that the 7-Day SEC Yields exclude distributed capital gains. Past performance is not indicative of future results. |
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| 6 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
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Fund Information (concluded) as of September 30, 2012 | | |
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| BlackRock Pennsylvania Municipal Money Market Portfolio |
BlackRock Pennsylvania Municipal Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income exempt from Federal income tax and, to the extent possible, Pennsylvania personal income tax, as is consistent with maintaining liquidity and stability of principal.
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Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
Service | | | | 0.00 | % | | | | 0.00 | % |
Investor A | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Variable Rate Demand Notes | | | | 94 | % |
Municipal Bonds | | | | 3 | |
Municipal Put Bonds | | | | 4 | |
Liabilities in Excess of Other Assets | | | | (1 | ) |
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Total | | | | 100 | % |
|
| BlackRock Virginia Municipal Money Market Portfolio |
BlackRock Virginia Municipal Money Market Portfolio’s (the “Fund”) investment objective is to seek as high a level of current income exempt from Federal income tax and, to the extent possible, Virginia state income tax, as is consistent with maintaining liquidity and stability of principal.
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Yields | | 7-Day SEC Yield | | 7-Day Yield |
Institutional | | | | 0.00 | % | | | | 0.00 | % |
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| Portfolio Composition | | Percent of
Net Assets |
Variable Rate Demand Notes | | | | 81 | % |
Municipal Bonds | | | | 4 | |
Municipal Put Bonds | | | | 7 | |
Other Assets Less Liabilities | | | | 8 | |
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Total | | | | 100 | % |
| | | The 7-Day SEC Yields may differ from the 7-Day Yields shown above due to the fact that the 7-Day SEC Yields exclude distributed capital gains. Past performance is not indicative of future results. |
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| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 7 |
Shareholders of the Funds may incur the following charges: (a) expenses related to transactions, including sales charges and exchange fees; and (b) operating expenses, including advisory fees, service and distribution fees, including 12b-1 fees, and other Fund expenses. The expense examples below (which are based on a hypothetical investment of $1,000 invested on April 1, 2012 and held through September 30, 2012) are intended to assist shareholders both in calculating expenses based on an investment in the Funds and in comparing these expenses with similar costs of investing in other mutual funds.
The expense examples provide information about actual account values and actual expenses. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number corresponding to their Fund and share class under the headings entitled “Expenses Paid During the Period.”
The expense examples also provide information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratios and an assumed rate of return of 5% per year before expenses. In order to assist shareholders in comparing the ongoing expenses of investing in these Funds and other funds, compare the 5% hypothetical example with the 5% hypothetical examples that appear in other funds’ shareholder reports.
The expenses shown in the expense examples are intended to highlight shareholders’ ongoing costs only and do not reflect any transactional expenses, such as sales charges or exchange fees, if any. Therefore, the hypothetical expense is useful in comparing ongoing expenses only, and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses would have been higher.
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| | | Actual | | | | Hypothetical1 | | |
| | | Beginning Account Value April 1,2012 | | Ending Account Value September 30, 2012 | | Expenses Paid During the Period2 | | | | Beginning
Account Value April 1,2012 | | Ending Account Value September 30, 2012 | | Expenses Paid During the Period2 | | Annualized
Expense Ratio |
BlackRock Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.55 | | | | | | $ | 1,000.00 | | | | $ | 1,023.51 | | | | $ | 1.57 | | | | | 0.31 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.55 | | | | | | $ | 1,000.00 | | | | $ | 1,023.51 | | | | $ | 1.57 | | | | | 0.31 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.55 | | | | | | $ | 1,000.00 | | | | $ | 1,023.51 | | | | $ | 1.57 | | | | | 0.31 | % |
Investor B | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.55 | | | | | | $ | 1,000.00 | | | | $ | 1,023.51 | | | | $ | 1.57 | | | | | 0.31 | % |
Investor C | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.55 | | | | | | $ | 1,000.00 | | | | $ | 1,023.51 | | | | $ | 1.57 | | | | | 0.31 | % |
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BlackRock U.S. Treasury Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 0.75 | | | | | | $ | 1,000.00 | | | | $ | 1,024.32 | | | | $ | 0.76 | | | | | 0.15 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 0.75 | | | | | | $ | 1,000.00 | | | | $ | 1,024.32 | | | | $ | 0.76 | | | | | 0.15 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 0.75 | | | | | | $ | 1,000.00 | | | | $ | 1,024.32 | | | | $ | 0.76 | | | | | 0.15 | % |
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BlackRock Municipal Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.20 | | | | | | $ | 1,000.00 | | | | $ | 1,023.87 | | | | $ | 1.22 | | | | | 0.24 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.20 | | | | | | $ | 1,000.00 | | | | $ | 1,023.87 | | | | $ | 1.22 | | | | | 0.24 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.20 | | | | | | $ | 1,000.00 | | | | $ | 1,023.87 | | | | $ | 1.22 | | | | | 0.24 | % |
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BlackRock New Jersey Municipal Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.35 | | | | | | $ | 1,000.00 | | | | $ | 1,023.71 | | | | $ | 1.37 | | | | | 0.27 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.30 | | | | | | $ | 1,000.00 | | | | $ | 1,023.76 | | | | $ | 1.32 | | | | | 0.26 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.35 | | | | | | $ | 1,000.00 | | | | $ | 1,023.71 | | | | $ | 1.37 | | | | | 0.27 | % |
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BlackRock North Carolina Municipal Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.00 | | | | | | $ | 1,000.00 | | | | $ | 1,024.07 | | | | $ | 1.01 | | | | | 0.20 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.30 | | | | | | $ | 1,000.00 | | | | $ | 1,023.76 | | | | $ | 1.32 | | | | | 0.26 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.05 | | | | | | $ | 1,000.00 | | | | $ | 1,024.02 | | | | $ | 1.07 | | | | | 0.21 | % |
| | 1 | Hypothetical 5% annual return before expenses is calculated by pro rating the number of days in the most recent fiscal half year divided by 365. |
| | 2 | For each class, expenses are equal to the annualized expense ratio for the class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period shown). |
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| 8 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
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| Expense Example (concluded) | | | | | | | | | | | | | | |
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| | | Actual | | | | Hypothetical1 | | |
| | | Beginning Account Value April 1,2012 | | Ending Account Value September 30, 2012 | | Expenses Paid During the Period2 | | | | Beginning
Account Value April 1,2012 | | Ending Account Value September 30, 2012 | | Expenses Paid During the Period2 | | Annualized
Expense Ratio |
BlackRock Ohio Municipal Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.20 | | | | | | $ | 1,000.00 | | | | $ | 1,023.87 | | | | $ | 1.22 | | | | | 0.24 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.15 | | | | | | $ | 1,000.00 | | | | $ | 1,023.92 | | | | $ | 1.17 | | | | | 0.23 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.20 | | | | | | $ | 1,000.00 | | | | $ | 1,023.87 | | | | $ | 1.22 | | | | | 0.24 | % |
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BlackRock Pennsylvania Municipal Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.10 | | | | | | $ | 1,000.00 | | | | $ | 1,023.97 | | | | $ | 1.12 | | | | | 0.22 | % |
Service | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.15 | | | | | | $ | 1,000.00 | | | | $ | 1,023.92 | | | | $ | 1.17 | | | | | 0.23 | % |
Investor A | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.15 | | | | | | $ | 1,000.00 | | | | $ | 1,023.92 | | | | $ | 1.17 | | | | | 0.23 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
BlackRock Virginia Municipal Money Market Portfolio | |
Institutional | | | $ | 1,000.00 | | | | $ | 1,000.00 | | | | $ | 1.10 | | | | | | $ | 1,000.00 | | | | $ | 1,023.97 | | | | $ | 1.12 | | | | | 0.22 | % |
| | 1 | Hypothetical 5% annual return before expenses is calculated by pro rating the number of days in the most recent fiscal half year divided by 365. |
| | 2 | For each class, expenses are equal to the annualized expense ratio for the class, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period shown). |
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| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 9 |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Certificates of Deposit | | Par (000) | | | Value | |
Euro – 1.1% | | | | | | | | |
National Australia Bank Ltd., London, 0.48%, 4/10/13 (a) | | $ | 16,000 | | | $ | 16,000,000 | |
Yankee – 31.2% (b) | | | | | | | | |
Bank of Montreal, Chicago, 0.44%,
7/17/13 (a) | | | 10,000 | | | | 10,000,000 | |
Bank of Nova Scotia, Houston: | | | | | | | | |
0.32%, 2/11/13 (a) | | | 15,000 | | | | 15,000,000 | |
0.27%, 2/15/13 (a) | | | 15,000 | | | | 15,000,000 | |
Bank of Tokyo-Mitsubishi UFJ Ltd.,
New York: | | | | | | | | |
0.19%, 10/01/12 | | | 20,000 | | | | 20,000,000 | |
0.36%, 10/05/12 | | | 2,550 | | | | 2,550,000 | |
0.43%, 11/14/12 | | | 10,000 | | | | 10,000,000 | |
0.41%, 11/30/12 | | | 9,000 | | | | 9,000,748 | |
BNP Paribas S.A., New York: | | | | | | | | |
0.38%, 12/04/12 | | | 7,000 | | | | 7,000,000 | |
0.42%, 1/02/13 | | | 7,000 | | | | 7,000,000 | |
Canadian Imperial Bank of Commerce, New York: | | | | | | | | |
0.32%, 3/01/13 (a) | | | 15,500 | | | | 15,500,000 | |
0.36%, 9/25/13 (a) | | | 13,000 | | | | 13,000,000 | |
Credit Industriel Et Commercial, New York, 0.44%, 12/04/12 | | | 13,500 | | | | 13,500,000 | |
Credit Suisse Group A.G., New York, 0.32%, 2/04/13 | | | 13,000 | | | | 13,000,000 | |
Mizuho Corporate Bank Ltd., New York: | | | | | | | | |
0.23%, 11/13/12 | | | 10,000 | | | | 10,000,000 | |
0.34%, 11/21/12 | | | 8,120 | | | | 8,120,000 | |
National Australia Bank Ltd., New York, 0.40%, 4/18/13 | | | 15,000 | | | | 15,000,000 | |
National Bank of Canada, New York, 0.32%, 1/11/13 (a) | | | 10,000 | | | | 10,000,000 | |
Natixis S.A., New York, 0.58%, 1/03/13 | | | 12,000 | | | | 12,000,000 | |
Nordea Bank Finland Plc, New York, 0.36%, 10/11/12 | | | 18,000 | | | | 18,000,000 | |
Norinchukin Bank, New York, 0.17%, 10/02/12 | | | 38,000 | | | | 38,000,000 | |
Rabobank Nederland N.V., New York: | | | | | | | | |
0.53%, 10/25/12 | | | 23,000 | | | | 23,000,000 | |
0.56%, 1/18/13 (a) | | | 15,000 | | | | 15,000,000 | |
0.50%, 6/18/13 (a) | | | 15,000 | | | | 15,000,000 | |
Royal Bank of Canada, New York, 0.46%, 5/16/13 (a) | | | 12,000 | | | | 12,000,000 | |
Skandinaviska Enskilda Banken AB,
New York, 0.40%, 10/05/12 | | | 15,000 | | | | 14,999,992 | |
Societe Generale, New York: | | | | | | | | |
0.46%, 12/03/12 | | | 7,000 | | | | 7,000,000 | |
0.58%, 1/03/13 | | | 22,500 | | | | 22,500,000 | |
Sumitomo Mitsui Banking Corp., New York: | | | | | | | | |
0.43%, 1/15/13 | | | 12,000 | | | | 12,000,000 | |
0.32%, 2/01/13 | | | 10,000 | | | | 10,000,000 | |
| | | | | | | | |
| Certificates of Deposit | | Par (000) | | | Value | |
Yankee (concluded) (b) | | | | | | | | |
Sumitomo Trust & Banking Co. Ltd.,
New York, 0.37%, 10/10/12 | | $ | 25,000 | | | $ | 25,000,000 | |
Toronto Dominion Bank, New York, 0.32%, 3/18/13 | | | 12,000 | | | | 12,000,000 | |
Westpac Banking Corp., New York, 0.54%, 7/10/13 (a) | | | 14,000 | | | | 14,000,000 | |
Total Certificates of Deposit – 32.3% | | | | | | | 460,170,740 | |
| |
| | | | | | | | |
| | | | | | | | |
| | |
Commercial Paper | | | | | | | | |
| |
Alpine Securitization Corp., 0.19%,
10/16/12 (c) | | | 20,000 | | | | 19,998,417 | |
Aspen Funding Corp., 0.40%,
11/26/12 (c) | | | 12,000 | | | | 11,992,533 | |
Atlantis One Funding Corp., 0.34%, 12/07/12 (c) | | | 15,000 | | | | 14,990,508 | |
Australia and New Zealand Banking Group Ltd., 0.32%, 1/30/13 (c) | | | 6,500 | | | | 6,493,009 | |
Cancara Asset Securitisation LLC, 0.42%, 10/09/12 (c) | | | 20,000 | | | | 19,998,133 | |
Chariot Funding LLC: | | | | | | | | |
0.21%, 11/21/12 (c) | | | 25,567 | | | | 25,559,394 | |
0.25%, 1/07/13 (c) | | | 13,000 | | | | 12,991,153 | |
Commonwealth Bank of Australia: | | | | | | | | |
0.19%, 11/21/12 (c) | | | 15,000 | | | | 14,995,963 | |
0.37%, 1/14/13 (a) | | | 6,000 | | | | 6,000,000 | |
Credit Suisse Group A.G., New York, 0.24%, 11/26/12 (c) | | | 15,000 | | | | 14,994,400 | |
Erste Abwicklungsanstalt: | | | | | | | | |
0.48%, 10/23/12 (c) | | | 10,000 | | | | 9,997,067 | |
0.45%, 11/07/12 (c) | | | 15,000 | | | | 14,993,063 | |
0.52%, 11/19/12 (c) | | | 13,065 | | | | 13,055,753 | |
Fairway Finance Corp.: | | | | | | | | |
0.20%, 11/29/12 (c) | | | 16,254 | | | | 16,248,672 | |
0.33%, 12/03/12 (c) | | | 7,000 | | | | 6,995,957 | |
Gemini Securitization Corp. LLC, 0.36%, 12/03/12 (c) | | | 4,000 | | | | 3,997,480 | |
HSBC Bank Plc, 0.66%, 4/25/13 (c) | | | 8,000 | | | | 7,969,970 | |
ING US Funding LLC: | | | | | | | | |
0.36%, 11/05/12 (c) | | | 25,000 | | | | 24,991,250 | |
0.38%, 11/16/12 (c) | | | 10,000 | | | | 9,995,144 | |
0.34%, 11/26/12 (c) | | | 15,000 | | | | 14,992,067 | |
Manhattan Asset Funding Co. LLC: | | | | | | | | |
0.22%, 10/09/12 (c) | | | 12,000 | | | | 11,999,413 | |
0.21%, 10/11/12 (c) | | | 10,000 | | | | 9,999,417 | |
Mizuho Funding LLC: | | | | | | | | |
0.34%, 11/19/12 (c) | | | 15,852 | | | | 15,844,664 | |
0.34%, 11/21/12 (c) | | | 20,000 | | | | 19,990,508 | |
To simplify the listings of portfolio holdings in the Schedules of Investments, the names and descriptions of many of the securities have been abbreviated according to the following list:
| | | | | | | | | | | | | | |
| AGM | | Assured Guaranty Municipal | | IDRB | | Industrial Development | | RAN | | Revenue Anticipation Notes | | TECP | | Tax-Exempt Commercial |
| | Corp. | | | | Revenue Bonds | | RB | | Revenue Bonds | | | | Paper |
| AMT | | Alternative Minimum Tax | | LOC | | Letter of Credit | | ROC | | Reset Option Certificates | | TRAN | | Tax Revenue Anticipation |
| | (subject to) | | MB | | Municipal Bonds | | SBPA | | Stand-by Bond Purchase | | | | Notes |
| BAN | | Bond Anticipation Notes | | PCRB | | Pollution Control Revenue | | | | Agreement | | VRDN | | Variable Rate Demand |
| COP | | Certificates of Participation | | | | Bonds | | SPEARS | | Short Puttable Exempt | | | | Notes |
| GO | | General Obligation Bonds | | PUTTERS | | Puttable Tax-Exempt | | | | Adjustable Receipts | | VRDP | | Variable Rate Demand |
| IDA | | Industrial Development Authority | | | | Receipts | | | | | | | | Preferred |
See Notes to Financial Statements.
| | | | | | |
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| 10 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments (continued) | | BlackRock Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Commercial Paper | | Par (000) | | | Value | |
Nieuw Amsterdam Receivables Corp.: | | | | | | | | |
0.28%, 10/09/12 (c) | | $ | 10,000 | | | $ | 9,999,378 | |
0.31%, 11/02/12 (c) | | | 10,000 | | | | 9,997,244 | |
Nordea North America, Inc.: | | | | | | | | |
0.22%, 11/14/12 (c) | | | 5,000 | | | | 4,998,656 | |
0.25%, 11/30/12 (c) | | | 5,000 | | | | 4,997,917 | |
Northern Pines Funding LLC, 0.38%, 11/26/12 (c) | | | 10,000 | | | | 9,994,089 | |
NRW.Bank: | | | | | | | | |
0.16%, 10/02/12 (c) | | | 20,000 | | | | 19,999,911 | |
0.25%, 11/19/12 (c) | | | 20,000 | | | | 19,993,194 | |
0.24%, 11/26/12 (c) | | | 20,000 | | | | 19,992,533 | |
Regency Markets No. 1 LLC: | | | | | | | | |
0.20%, 10/05/12 (c) | | | 15,000 | | | | 14,999,667 | |
0.21%, 10/22/12 (c) | | | 12,000 | | | | 11,998,530 | |
State Street Corp., 0.22%, 1/08/13 (c) | | | 20,000 | | | | 19,987,900 | |
Svenska Handelsbanken, Inc., 0.30%, 10/26/12 (c) | | | 10,000 | | | | 9,997,917 | |
Victory Receivables Corp., 0.27%, 11/27/12 (c) | | | 10,000 | | | | 9,995,725 | |
Westpac Banking Corp.: | | | | | | | | |
0.50%, 4/02/13 (c) | | | 12,500 | | | | 12,468,229 | |
0.48%, 8/09/13 (c) | | | 13,616 | | | | 13,559,357 | |
Total Commercial Paper – 36.7% | | | | | | | 522,064,182 | |
| |
| | | | | | | | |
| | | | | | | | |
| | |
Corporate Notes | | | | | | | | |
| |
JPMorgan Chase Bank N.A., 0.53%, 5/17/13 (a) | | | 17,135 | | | | 17,135,000 | |
Park Village Assisted Living LLC, 0.27%, 10/05/12 (d) | | | 5,755 | | | | 5,755,000 | |
Total Corporate Notes – 1.6% | | | | | | | 22,890,000 | |
| |
| | | | | | | | |
| | | | | | | | |
| | |
Municipal Bonds | | | | | | | | |
| |
Brazos River Harbor Navigation District Brazoria County RB (JT Venture Project) Series 1998 VRDN (JPMorgan Chase Bank N.A. LOC), 0.24%, 10/01/12 (d) | | | 10,400 | | | | 10,400,000 | |
California Housing Finance Agency Home Mortgage RB Series 2003U AMT VRDN (Fannie Mae LOC, Freddie Mac LOC),
0.19%, 10/05/12 (d) | | | 6,500 | | | | 6,500,000 | |
California Pollution Control Financing Authority RB (Sierra Pacific Industries Inc. Project) Series 1988 VRDN (Wells Fargo Bank N.A. LOC), 0.21%, 10/05/12 (d) | | | 8,675 | | | | 8,675,000 | |
Houston Utility System RB (First Lien Water Revenue Project) Series 2004-B3 VRDN (Sumitomo Mitsui Banking Corp. LOC), 0.17%, 10/05/12 (d) | | | 17,000 | | | | 17,000,000 | |
Michigan State Housing Development Authority RB Series 2009D VRDN (Fannie Mae Guaranty, Freddie Mac Guaranty), 0.17%, 10/05/12 (d) | | | 7,040 | | | | 7,040,000 | |
New York City GO Series 2003A-3 VRDN (Morgan Stanley Bank LOC), 0.19%, 10/05/12 (d) | | | 10,000 | | | | 10,000,000 | |
New York City IDA RB (New York Law School Project) Series 2006 VRDN (JPMorgan Chase Bank N.A. LOC), 0.18%, 10/05/12 (d) | | | 9,320 | | | | 9,320,000 | |
Rhode Island Housing & Mortgage Finance Corp. RB (Groves at Johnston Project) Series 2006 VRDN (Freddie Mac Guaranty), 0.18%, 10/05/12 (d) | | | 26,350 | | | | 26,350,000 | |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
San Francisco City & County COP Municipal Trust Receipts Floaters Series 2010-B001 VRDN (Morgan Stanley Bank SBPA), 0.26%, 10/05/12 (d)(e)(f) | | $ | 6,000 | | | $ | 6,000,000 | |
Savannah College Georgia RB (Art & Design Project) Series 2004 VRDN (Bank of America N.A. LOC), 0.23%, 10/05/12 (d) | | | 4,900 | | | | 4,900,000 | |
South Central Texas IDRB (Rohr Industries Project) Series 1990 VRDN (Bank One N.A. LOC), 0.18%, 10/05/12 (d) | | | 14,800 | | | | 14,800,000 | |
Total Municipal Bonds – 8.5% | | | | | | | 120,985,000 | |
| |
| | | | | | | | |
| | | | | | | | |
|
Closed-End Investment Companies | |
| |
California – 0.4% | | | | | | | | |
Nuveen California Investment Quality Municipal Fund, Inc. Series 2010-1-956 VRDP (Citibank N.A. Liquidity Facility), 0.28%, 10/05/12 (d)(e) | | | 5,000 | | | | 5,000,000 | |
New York – 0.5% | | | | | | | | |
Nuveen New York Select Quality Municipal Fund, Inc. Series 2010-1-1648 VRDP (Citibank N.A. Liquidity Facility), 0.28%, 10/05/12 (d)(e) | | | 7,600 | | | | 7,600,000 | |
Total Closed-End Investment
Companies – 0.9% | | | | 12,600,000 | |
| |
| | | | | | | | |
| | | | | | | | |
|
U.S. Government Sponsored Agency
Obligations | |
| |
Fannie Mae Variable Rate Notes, 0.25%, 12/20/12 (a) | | | 9,000 | | | | 8,999,601 | |
Freddie Mac Variable Rate Notes: (a) | | | | | | | | |
0.17%, 11/02/12 | | | 15,000 | | | | 14,999,203 | |
0.31%, 1/24/13 | | | 8,000 | | | | 7,998,984 | |
0.37%, 9/03/13 | | | 15,000 | | | | 14,997,206 | |
0.17%, 9/13/13 | | | 36,700 | | | | 36,678,851 | |
Total U.S. Government Sponsored Agency Obligations – 5.9% | | | | | | | 83,673,845 | |
| |
| | | | | | | | |
| | | | | | | | |
|
U.S. Treasury Obligations | |
| |
U.S. Treasury Bills: (c) | | | | | | | | |
0.13%, 11/29/12 | | | 10,000 | | | | 9,997,869 | |
0.09%, 12/27/12 | | | 3,332 | | | | 3,331,316 | |
0.13%, 3/07/13 | | | 15,000 | | | | 14,991,496 | |
0.14%, 3/21/13 | | | 10,000 | | | | 9,993,350 | |
U.S. Treasury Notes: | | | | | | | | |
4.25%, 9/30/12 | | | 17,000 | | | | 17,000,000 | |
0.38%, 10/31/12 | | | 12,000 | | | | 12,002,129 | |
0.50%, 11/30/12 | | | 15,000 | | | | 15,008,760 | |
3.38%, 11/30/12 | | | 15,000 | | | | 15,079,995 | |
1.38%, 2/15/13 | | | 12,000 | | | | 12,051,869 | |
2.50%, 3/31/13 | | | 10,000 | | | | 10,115,579 | |
1.38%, 5/15/13 | | | 19,000 | | | | 19,137,503 | |
3.38%, 6/30/13 | | | 5,000 | | | | 5,119,400 | |
Total U.S. Treasury Obligations – 10.1% | | | | 143,829,266 | |
| |
| | | | | | | | |
| | | | | | | | |
See Notes to Financial Statements.
| | | | | | |
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| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 11 |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Repurchase Agreements | | Par (000) | | | Value | |
Barclays Capital, Inc.,
0.70%, 10/01/12 (d)
(Purchased on 8/03/12 to be repurchased at $15,000,000, collateralized by various corporate/debt and U.S. government sponsored agency obligations, 0.00% to 8.00% due from 11/17/14 to 10/25/46,aggregate par and fair value of $59,203,758and $17,371,886, respectively) | | $ | 15,000 | | | $ | 15,000,000 | |
Deutsche Bank Securities Inc.,
0.20%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $41,717,695, collateralized by various U.S. government sponsored agency obligations, 0.56% to 0.78% due from 12/19/14 to 2/16/16, aggregate par and fair value of $42,419,000 and $42,552,217, respectively) | | | 41,717 | | | | 41,717,000 | |
Total Repurchase Agreements – 4.0% | | | | 56,717,000 | |
| |
Total Investments
(Cost – $1,422,930,033*) – 100.0% | | | | 1,422,930,033 | |
Other Assets Less Liabilities – 0.0% | | | | | | | 187,162 | |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 1,423,117,195 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Variable rate security. Rate shown is as of report date. |
| (b) | Issuer is a US branch of a foreign domiciled bank. |
| (c) | Rate shown reflects the discount rate at the time of purchase. |
| (d) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| (e) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (f) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| — | | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| | — | | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | — | | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| | — | | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
| | | | |
Assets: | | | | | | | | |
| | | | |
Investments: | | | | | | | | |
| | | | |
Short-Term Securities1 | | – | | $ 1,422,930,033 | | – | | $ 1,422,930,033 |
| | 1 | See above Schedule of Investments for values in each security type. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $11,812 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| 12 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock U.S. Treasury Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| U.S. Treasury Obligations | | Par (000) | | | Value | |
U.S. Treasury Bills: (a) | | | | | | | | |
0.14%, 10/04/12 | | $ | 3,000 | | | $ | 2,999,965 | |
0.15%, 10/04/12 | | | 2,000 | | | | 1,999,976 | |
0.13%, 10/18/12 | | | 3,000 | | | | 2,999,816 | |
0.13%, 10/25/12 | | | 4,000 | | | | 3,999,667 | |
0.14%, 10/25/12 | | | 12,000 | | | | 11,998,920 | |
0.15%, 11/01/12 | | | 5,000 | | | | 4,999,376 | |
0.15%, 11/15/12 | | | 5,000 | | | | 4,999,094 | |
0.15%, 11/23/12 | | | 7,000 | | | | 6,998,506 | |
0.15%, 11/29/12 | | | 5,000 | | | | 4,998,812 | |
0.13%, 12/06/12 | | | 5,000 | | | | 4,998,808 | |
0.15%, 12/20/12 | | | 5,000 | | | | 4,998,333 | |
0.16%, 1/03/13 | | | 5,000 | | | | 4,997,976 | |
0.15%, 1/10/13 | | | 5,000 | | | | 4,997,966 | |
0.15%, 1/17/13 | | | 5,000 | | | | 4,997,825 | |
0.14%, 1/24/13 | | | 10,000 | | | | 9,995,464 | |
0.13%, 2/07/13 | | | 10,000 | | | | 9,995,342 | |
0.15%, 2/14/13 | | | 8,000 | | | | 7,995,618 | |
0.15%, 2/21/13 | | | 8,000 | | | | 7,995,392 | |
0.14%, 2/28/13 | | | 5,000 | | | | 4,997,083 | |
0.14%, 3/07/13 | | | 10,000 | | | | 9,993,894 | |
0.17%, 3/07/13 | | | 3,300 | | | | 3,297,553 | |
0.14%, 3/14/13 | | | 10,000 | | | | 9,993,622 | |
0.14%, 3/21/13 | | | 5,000 | | | | 4,996,794 | |
0.14%, 3/28/13 | | | 3,000 | | | | 2,997,923 | |
0.20%, 8/22/13 | | | 2,000 | | | | 1,996,479 | |
U.S. Treasury Notes, | | | | | | | | |
1.38%, 10/15/12 | | | 5,000 | | | | 5,002,370 | |
1.38%, 11/15/12 | | | 2,000 | | | | 2,002,926 | |
0.63%, 2/28/13 | | | 3,000 | | | | 3,005,304 | |
1.38%, 3/15/13 | | | 3,000 | | | | 3,015,829 | |
| | |
| | | | | | | | | |
Total U.S. Treasury Obligations – 50.0% | | | | 158,266,633 | |
| | | | | | | | |
| | | | | | | | |
| | |
| Repurchase Agreements | | | | | | |
Barclays Capital, Inc.,
0.20%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $19,000,317, collateralized by U.S. Treasury Note, 1.25% due at 9/30/15, par and fair value of $18,758,500 and $19,380,001, respectively) | | | 19,000 | | | | 19,000,000 | |
Credit Suisse Securities (USA) LLC,
0.20%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $15,000,250, collateralized by U.S. Treasury Note, 1.50% due at 7/31/16, par and fair value of $14,680,000 and $15,302,504, respectively) | | | 15,000 | | | | 15,000,000 | |
Deutsche Bank Securities Inc.,
0.18%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $25,476,382, collateralized by U.S. Treasury Bond, 3.13% due at 2/15/42, par and fair value of $24,307,200 and $25,985,525, respectively) | | | 25,476 | | | | 25,476,000 | |
| | | | | | | | |
| Repurchase Agreements | | Par (000) | | | Value | |
HSBC Securities (USA) Inc.,
0.20%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $15,000,250, collateralized by U.S. Treasury Strip, 0.00% due at 8/15/17, par and fair value of $15,800,000 and $15,301,352, respectively) | | $ | 15,000 | | | $ | 15,000,000 | |
JPMorgan Securities LLC,
0.18%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $18,000,270, collateralized by U.S. Treasury Strip, 0.00% due at 2/15/22, par and fair value of $21,440,000 and $18,360,144, respectively) | | | 18,000 | | | | 18,000,000 | |
Morgan Stanley & Co. LLC,
0.21%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $18,000,315, collateralized by U.S. Treasury Inflation Bond, 3.38% due at 4/15/32, par and fair value of $8,439,300 and $18,360,053, respectively) | | | 18,000 | | | | 18,000,000 | |
RBS Securities Inc.,
0.20%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $18,000,300, collateralized by U.S. Treasury Note, 1.38% to 3.38% due from 11/30/12 to 2/15/13, aggregate par and fair value of $18,111,300 and $18,361,094, respectively) | | | 18,000 | | | | 18,000,000 | |
UBS Securities LLC,
0.20%, 10/01/12
(Purchased on 9/28/12 to be repurchased at $30,000,500, collateralized by U.S. Treasury Note, 0.63% due at 5/31/17, par and fair value of $30,470,900 and $30,600,011, respectively) | | | 30,000 | | | | 30,000,000 | |
Total Repurchase Agreements – 50.1% | | | | | | | 158,476,000 | |
Total Investments (Cost – $316,742,633*) – 100.1% | | | | 316,742,633 | |
Liabilities in Excess of Other Assets – (0.1)% | | | | (373,832 | ) |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 316,368,801 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Rate shown reflects the discount rate at the time of purchase. |
| • | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| | • | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | • | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 13 |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock U.S. Treasury Money Market Portfolio |
| | • | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
| | | | |
Assets: | | | | | | | | |
Investments: | | | | | | | | |
Short-Term Securities1 | | – | | $ 316,742,633 | | – | | $ 316,742,633 |
| | 1 | See above Schedule of Investments for values in each security type. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $92 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
14 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
| |
| Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
Alabama – 3.0% | | | | | | | | |
Columbia IDRB (Alabama Power Co. Project)
Series 1995B VRDN, 0.19%, 10/01/12 (a) | | $ | 3,400 | | | $ | 3,400,000 | |
| |
Alaska – 0.3% | | | | | | | | |
Alaska Student Loan Corp. RB Series 2012B-1 Mandatory Put Bonds (State Street Bank & Trust Co. LOC), 0.37%, 6/01/13 (a) | | | 300 | | | | 300,000 | |
| |
Arizona – 3.3% | | | | | | | | |
Salt River Pima-Maricopa Indian Community RB Series 2005 VRDN (Bank of America N.A. LOC), 0.19%, 10/05/12 (a) | | | 1,500 | | | | 1,500,000 | |
Salt River Pima-Maricopa Indian Community RB Series 2006 VRDN (Bank of America N.A. LOC), 0.19%, 10/05/12 (a) | | | 2,205 | | | | 2,205,000 | |
| | | | | | | | |
| | | | | | | 3,705,000 | |
| |
Arkansas – 0.1% | | | | | | | | |
Rogers RB Series 2011 MB,
2.00%, 11/01/12 | | | 100 | | | | 100,140 | |
| |
California – 12.7% | | | | | | | | |
ABAG Finance Authority Nonprofit Corp. RB (Acacia Creek at Union City Project) Series 2008A VRDN (Bank of America N.A. SBPA), 0.26%, 10/01/12 (a) | | | 1,000 | | | | 1,000,000 | |
California RB PUTTERS Series 2012A-1-4265 VRDN (JPMorgan Chase Bank N.A. SBPA), 0.21%, 10/01/12 (a)(b)(c) | | | 3,000 | | | | 3,000,000 | |
California RB Series 2012A-1 RAN,
2.50%, 5/30/13 | | | 2,400 | | | | 2,434,291 | |
California RB Series 2012A-2 RAN,
2.50%, 6/20/13 | | | 600 | | | | 608,884 | |
California Statewide Communities Development Authority RB (Los Angeles County Museum of Arts Project) Series 2008 VRDN (Union Bank N.A. LOC), 0.17%, 10/05/12 (a) | | | 600 | | | | 600,000 | |
California Statewide Communities Development Authority RB (Retirement Housing Foundation Obligated Group Project) Series 2008 VRDN (U.S. Bank NA LOC), 0.17%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
Corona-Norca Unified School District GO Series 2012 TRAN, 2.00%, 12/31/12 | | | 1,000 | | | | 1,004,341 | |
Fontana Unified School District GO PUTTERS Series 2008-2668 VRDN (AGM Insurance, JPMorgan Chase Bank N.A. SBPA),
0.28%, 10/05/12 (a)(b)(c) | | | 500 | | | | 500,000 | |
Fremont COP Series 2008 VRDN (U.S. Bank N.A. LOC), 0.17%, 10/05/12 (a) | | | 1,800 | | | | 1,800,000 | |
Irvine Unified School District RB (Community Facility Project) Series 2012 VRDN (Bank of America N.A. LOC),
0.20%, 10/01/12 (a) | | | 400 | | | | 400,000 | |
Riverside Water Revenue RB Series 2011A Mandatory Put Bonds, 0.23%, 5/01/13 (a) | | | 500 | | | | 500,000 | |
Sacramento Unified School District GO Series 2012 TRAN, 2.00%, 10/01/12 | | | 500 | | | | 500,000 | |
San Juan Unified School District GO Series 2012 TRAN, 2.00%, 10/01/12 | | | 1,000 | | | | 1,000,000 | |
| | | | | | | | |
| | | | | | | 14,347,516 | |
| |
Connecticut – 0.7% | | | | | | | | |
Brooklyn GO Series 2012 BAN,
1.00%, 8/13/13 | | | 800 | | | | 804,757 | |
| |
Florida – 1.0% | | | | | | | | |
Lee Memorial Health System RB SPEARS Series 2011-1016 VRDN (Deutsche Bank A.G. Credit Agreement),
0.23%, 10/05/12 (a)(b)(c) | | | 1,200 | | | | 1,200,000 | |
| |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
Georgia – 1.4% | | | | | | | | |
Meriwether County IDA RB (Crown Technology LLC Project) Series 2010 AMT VRDN (Federal Home Loan Bank LOC), 0.28%, 10/05/12 (a) | | $ | 1,560 | | | $ | 1,560,000 | |
| |
Illinois – 3.3% | | | | | | | | |
Chicago Waterworks RB (Second Lien Project) Sub-Series 2000-1 VRDN (JPMorgan Chase Bank N.A. SBPA),
0.23%, 10/01/12 (a) | | | 3,500 | | | | 3,500,000 | |
Illinois State Finance Authority RB SPEARS (OSF Healthcare System Project) Series 2012DBE-1115 VRDN (Deutsche Bank A.G. Guaranty, Deutsche Bank A.G. SBPA), 0.23%, 10/05/12 (a)(b)(c) | | | 200 | | | | 200,000 | |
| | | | | | | | |
| | | | | | | 3,700,000 | |
| |
Indiana – 6.0% | | | | | | | | |
Indiana Finance Authority RB (Hamilton Grove Project) Series 2008A VRDN (Bank of America N.A. LOC), 0.21%, 10/05/12 (a) | | | 2,655 | | | | 2,655,000 | |
Indiana Finance Authority RB (Parkview Health System Project) Series 2009D VRDN (Wells Fargo Bank N.A. LOC),
0.18%, 10/05/12 (a) | | | 4,200 | | | | 4,200,000 | |
| | | | | | | | |
| | | | | | | 6,855,000 | |
| |
Iowa – 2.3% | | | | | | | | |
Iowa Finance Authority RB (Bio America Inc. Project) Series 2012 VRDN (Korea Development Bank LOC),
0.35%, 10/05/12 (a) | | | 2,600 | | | | 2,600,000 | |
| |
Kansas – 2.9% | | | | | | | | |
Leawood GO Series 2012-1, 1.50%, 9/01/13 | | | 2,050 | | | | 2,073,020 | |
Topeka GO Series 2011A, 1.25%, 10/01/12 | | | 1,230 | | | | 1,230,000 | |
| | | | | | | | |
| | | | | | | 3,303,020 | |
| |
Louisiana – 1.7% | | | | | | | | |
St. James Parish RB (Nucor Steel LLC Project) Series 2010B-1 VRDN (Nucor Corporation Guaranty), 0.19%, 10/05/12 (a) | | | 1,900 | | | | 1,900,000 | |
| |
Maryland – 4.4% | | | | | | | | |
Maryland Community Development Administration RB (Residential Project) Series 2007 VRDN (TD Bank N.A. SBPA), 0.17%, 10/05/12 (a) | | | 3,000 | | | | 3,000,000 | |
Maryland Economic Development Corp. RB (Assoc. of Catholic Charities Project) Series 1999B VRDN (Manufacturers and Traders Trust Co. LOC),
0.18%, 10/05/12 (a) | | | 900 | | | | 900,000 | |
Maryland Economic Development Corp. RB (Bindagraphics, Inc. Project) Series 2001 VRDN (Manufacturers and Traders Trust Co. LOC), 0.32%, 10/05/12 (a) | | | 1,125 | | | | 1,125,000 | |
| | | | | | | | |
| | | | | | | 5,025,000 | |
| |
Massachusetts – 0.7% | | | | | | | | |
Fitchburg GO Series 2012B BAN,
1.50%, 6/28/13 | | | 750 | | | | 754,962 | |
| |
Michigan – 3.1% | | | | | | | | |
Detroit Water Supply System RB PUTTERS Series 2012-4240 VRDN (Berkshire Hathaway Assurance Corp. Insurance, Deutsche Bank AG SBPA),
0.43%, 10/05/12 (a)(b)(c) | | | 300 | | | | 300,000 | |
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 15 |
| | |
| | |
Schedule of Investments (continued) | | BlackRock Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
Michigan (concluded) | | | | | | | | |
Eastern Michigan University RB Series 2008B VRDN (JPMorgan Chase Bank N.A. LOC), 0.21%, 10/01/12 (a) | | $ | 1,800 | | | $ | 1,800,000 | |
Michigan Strategic Fund RB (Hindu Temple Project) Series 2009 VRDN (Comerica Bank LOC), 0.22%, 10/01/12 (a) | | | 450 | | | | 450,000 | |
Michigan Strategic Fund RB (Larsen Warden Project) Series 2008 VRDN (Standard Chartered Bank LOC), 0.65%, 10/05/12 (a) | | | 500 | | | | 500,000 | |
Michigan Strategic Fund RB (Mans LLC Project) Series 2012 VRDN (Comerica Bank LOC), 0.28%, 10/05/12 (a) | | | 500 | | | | 500,000 | |
| �� | | | | | | | |
| | | | | | | 3,550,000 | |
| |
Minnesota – 0.1% | | | | | | | | |
Minneapolis Health Care System Revenue Authority RB RBC Municipal Products, Inc. Trust Series 2010E-19 Mandatory Put Bonds (Royal Bank of Canada LOC, Royal Bank of Canada SBPA), 0.18%, 10/05/12 (a)(b) | | | 100 | | | | 100,000 | |
| |
Mississippi – 0.2% | | | | | | | | |
University of Mississippi Educational Building Corp. RB (Student Housing Construction Project) Series 2011I MB, 2.00%, 10/01/12 | | | 235 | | | | 235,000 | |
| |
Missouri – 1.5% | | | | | | | | |
Taney County IDRB (Keeter Heights Project) Series 2006 AMT VRDN (U.S. Bank N.A. LOC), 0.25%, 10/05/12 (a) | | | 1,745 | | | | 1,745,000 | |
| |
Nevada – 1.9% | | | | | | | | |
Clark County Airport System Junior Subordinate Lien RB Series 2012A-1, 2.00%, 7/01/13 | | | 1,200 | | | | 1,214,174 | |
Clark County Airport System Junior Subordinate Lien RB Series 2012A-2, 2.00%, 7/01/13 | | | 900 | | | | 911,077 | |
| | | | | | | | |
| | | | | | | 2,125,251 | |
| |
New Jersey – 1.6% | | | | | | | | |
Burlington County Bridge Commission RB (Soil Waste Project) Series 2011, 2.00%, 10/10/12 | | | 200 | | | | 200,075 | |
Clark Township GO Series 2012 BAN, 1.25%, 3/22/13 | | | 500 | | | | 501,899 | |
Marlboro Township GO Series 2012 BAN, 1.25%, 6/13/13 | | | 100 | | | | 100,521 | |
Saddle River Borough GO Series 2012 BAN, 1.00%, 3/28/13 | | | 1,000 | | | | 1,002,471 | |
| | | | | | | | |
| | | | | | | 1,804,966 | |
| |
New York – 2.0% | | | | | | | | |
Nassau County IDA RB (Clinton Plaza Senior Housing Project) Series 2004 VRDN (Fannie Mae Guaranty),
0.21%, 10/05/12 (a) | | | 250 | | | | 250,000 | |
New York City Municipal Water TECP, 0.24%, 11/08/12 | | | 2,000 | | | | 2,000,000 | |
| | | | | | | | |
| | | | | | | 2,250,000 | |
| |
North Carolina – 0.5% | | | | | | | | |
Catawba County RB Series 2011 MB,
2.00%, 10/01/12 | | | 100 | | | | 100,000 | |
University of North Carolina System RB (North Carolina Agricultural and Technical State University Project) Series 2011C MB, 2.00%, 10/01/12 | | | 425 | | | | 425,000 | |
| | | | | | | | |
| | | | | | | 525,000 | |
| |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
Ohio – 3.5% | | | | | | | | |
Cleveland Department of Public Utilities Division of Water RB Series 2012, 1.50%, 1/25/13 | | $ | 500 | | | $ | 500,969 | |
Ohio RB (Development Assistance Project) Series 2012A BAN, 0.35%, 5/30/13 | | | 750 | | | | 750,000 | |
Ohio RB (Revitalization Project) Series 2012A BAN, 0.35%, 5/30/13 | | | 250 | | | | 250,000 | |
Trumbull County Health Care Facilities RB Series 2001 VRDN (Manufacturers and Traders Trust Co. LOC), 0.20%, 10/05/12 (a) | | | 2,430 | | | | 2,430,000 | |
| | | | | | | | |
| | | | | | | 3,930,969 | |
| |
Pennsylvania – 12.4% | | | | | | | | |
Allegheny County Hospital Development Authority RB (University of Pittsburgh Medical Center Project) Series 2010B-2 VRDN (Deutsche Bank A.G. LOC), 0.17%, 10/05/12 (a) | | | 4,800 | | | | 4,800,000 | |
Berks County IDRB (Zenith Properties LP Project) Series 2006 VRDN (Wells Fargo Bank N.A. LOC), 0.39%, 10/05/12 (a) | | | 5,560 | | | | 5,560,000 | |
Pennsylvania Turnpike Commission RB RBC Municipal Products, Inc. Trust Series 2011E-22 VRDN (Royal Bank of Canada LOC, Royal Bank of Canada SBPA),
0.18%, 10/05/12 (a)(b) | | | 1,700 | | | | 1,700,000 | |
Philadelphia GO (Multi-Modal Project) Series 2009B VRDN (Royal Bank of Canada LOC), 0.16%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
Philadelphia School District GO Series 2011F VRDN (Barclays Bank Plc LOC), 0.18%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
| | | | | | | | |
| | | | | | | 14,060,000 | |
| |
Rhode Island – 0.9% | | | | | | | | |
Rhode Island Health & Educational Building Corp. RB (St. Georges School Project) Series 2003 VRDN (Wells Fargo Bank N.A. SBPA), 0.26%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
| |
Tennessee – 1.6% | | | | | | | | |
Metropolitan Government of Nashville & Davidson County Health & Educational Facilities Board RB (Ascension Health Credit Group Project) Series 2001B-1 VRDN (Ascension Health System Obligor), 0.27%, 4/26/13 (a) | | | 1,200 | | | | 1,200,000 | |
Montgomery County Public Building Authority Pooled Financing RB (Tennessee County Loan Pool Project) Series 1995 VRDN (Bank of America N.A. LOC),
0.28%, 10/05/12 (a) | | | 625 | | | | 625,000 | |
| | | | | | | | |
| | | | | | | 1,825,000 | |
| |
Texas – 0.5% | | | | | | | | |
Port of Arthur Navigation District Industrial Development Corp. RB (Total Petrochemicals Project) Series 2012 VRDN (Total S.A. Credit Agreement), 0.20%, 10/05/12 (a) | | | 600 | | | | 600,000 | |
| |
Utah – 2.7% | | | | | | | | |
Utah GO Municipal Trust Receipts Floaters Series 2009-2987 VRDN (Morgan Stanley Bank SBPA), 0.25%, 10/05/12 (a)(b)(c) | | | 3,050 | | | | 3,050,000 | |
| |
Virginia – 1.6% | | | | | | | | |
Fairfax County IDA RB (Inova Health System Project) Series 2012 VRDN, 0.26%, 4/26/13 (a) | | | 1,000 | | | | 1,000,000 | |
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| 16 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
Virginia (concluded) | | | | | | | | |
Hampton Roads Sanitation District RB
Series 2011 MB, 2.00%, 11/01/12 | | $ | 800 | | | $ | 801,130 | |
| | | | | | | | |
| | | | | | | 1,801,130 | |
| |
Washington – 8.9% | | | | | | | | |
Washington Health Care Facilities Authority RB (Multicare Health System Project) Series 2007D VRDN (AGM Corp. Insurance, Barclays Bank Plc LOC), 0.20%, 10/01/12 (a) | | | 9,815 | | | | 9,815,000 | |
Washington State University RB PUTTERS Series 2012-4241 VRDN (Deutsche Bank AG SBPA), 0.23%, 10/05/12 (a)(b)(c) | | | 300 | | | | 300,000 | |
| | | | | | | | |
| | | | | | | 10,115,000 | |
| |
Wisconsin – 4.3% | | | | | | | | |
Wisconsin Economic Authority GO Series 2012 TECP:
0.26%, 11/05/12 | | | 4,000 | | | | 4,000,000 | |
0.25%, 11/07/12 | | | 900 | | | | 900,000 | |
| | | | | | | | |
| | | | | | | 4,900,000 | |
| |
Wyoming – 3.1% | | | | | | | | |
Wyoming Community Development Authority RB Municipal Trust Receipts Floaters Series 2006-1424-R VRDN (Bank of America N.A. SBPA), 0.32%, 10/05/12 (a)(b)(c) | | | 3,500 | | | | 3,500,000 | |
| |
Total Municipal Bonds – 94.2% | | | | | | | 106,672,711 | |
| |
| | | | | | | | |
| | | | | | | | |
| | |
Closed-End Investment Companies | | | | | | | | |
| |
Multi-State – 5.7% | | | | | | | | |
Nuveen Municipal Advantage Fund, Inc. | | | | | | | | |
Series 2010 VRDP (JPMorgan
Chase Bank | | | | | | | | |
N.A. Liquidity Facility),
0.27%, 10/05/12 (a)(b) | | | 5,500 | | | | 5,500,000 | |
Nuveen Municipal Market
Opportunities Fund, | | | | | | | | |
Inc. Series 2010-3509 VRDP
(Deutsche Bank | | | | | | | | |
A.G. Liquidity Facility),
0.32%, 10/05/12 (a)(b) | | | 1,000 | | | | 1,000,000 | |
| |
Total Closed-End Investment Companies – 5.7% | | | | 6,500,000 | |
| |
Total Investments (Cost – $113,172,711*) – 99.9% | | | | 113,172,711 | |
Other Assets Less Liabilities – 0.1% | | | | | | | 92,807 | |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 113,265,518 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| (b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| — | | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| — | | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| — | | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| — | | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
| | | | |
Assets: | | | | | | | | |
| | | | |
Investments: | | | | | | | | |
Short-Term Securities1 | | – | | $113,172,711 | | – | | $113,172,711 |
| | 1 | See above Schedule of Investments for values in each state. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $17,144 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 17 |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock New Jersey Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
New Jersey – 85.3% | | | | | | | | |
Burlington County Bridge Commission RB (Soil Waste Project) Series 2011,
2.00%, 10/10/12 | | $ | 100 | | | $ | 100,037 | |
Clark Township GO Series 2012 BAN,
1.25%, 3/22/13 | | | 500 | | | | 501,900 | |
Clinton Township GO Series 2012 BAN,
1.00%, 2/01/13 | | | 600 | | | | 600,932 | |
Colts Neck Township GO Series 2012 BAN,
1.25%, 2/26/13 | | | 600 | | | | 601,834 | |
Cresskill Borough GO Series 2012 BAN,
1.00%, 3/08/13 | | | 500 | | | | 500,773 | |
Delaware River Port Authority RB Series 2010B VRDN (Bank of America N.A. LOC),
0.17%, 10/05/12 (a) | | | 2,700 | | | | 2,700,000 | |
Essex County Improvement Authority RB (Pooled Governmental Loan Program Project) Series 1986 VRDN (Wells Fargo Bank N.A. LOC),
0.15%, 10/05/12 (a) | | | 2,100 | | | | 2,100,000 | |
Kenilworth Borough GO Series 2011 BAN,
1.00%, 12/14/12 | | | 100 | | | | 100,072 | |
Lower Township Municipal Utilities Authority RB Series 2012B, 1.50%, 9/20/13 | | | 1,000 | | | | 1,009,647 | |
Marlboro Township GO Series 2012 BAN,
1.25%, 6/13/13 | | | 400 | | | | 402,085 | |
Neptune Township GO Series 2012 BAN,
1.00%, 9/13/13 | | | 800 | | | | 802,715 | |
New Jersey Economic Development Authority PCRB (Exxon Project) Series 1989 VRDN,
0.06%, 10/01/12 (a) | | | 1,860 | | | | 1,860,000 | |
New Jersey Economic Development Authority RB (Hamilton Industrial Development Project) Series 1998 VRDN (Wells Fargo Bank N.A. LOC), 0.34%, 10/05/12 (a) | | | 950 | | | | 950,000 | |
New Jersey Economic Development Authority RB (J. James Realty Co. Project) Series 1998 AMT VRDN (Wells Fargo Bank N.A. LOC),
0.34%, 10/05/12 (a) | | | 100 | | | | 100,000 | |
New Jersey Economic Development Authority RB (Morris Museum Project) Series 2006 VRDN (JPMorgan Chase Bank N.A. LOC),
0.15%, 10/05/12 (a) | | | 8,200 | | | | 8,200,000 | |
New Jersey Economic Development Authority RB (Nandan Co. Project) Series 2000 AMT VRDN (Manufacturers and Traders Trust Co. LOC),
0.23%, 10/05/12 (a) | | | 1,420 | | | | 1,420,000 | |
New Jersey Economic Development Authority RB (Paddock Realty LLC Project) Series 2006 AMT VRDN (Wells Fargo Bank N.A. LOC),
0.34%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
New Jersey Economic Development Authority RB (Pennington Montessori School Project) Series 1999 VRDN (Wells Fargo Bank N.A. LOC),
0.29%, 10/05/12 (a) | | | 815 | | | | 815,000 | |
New Jersey Economic Development Authority RB (The Cooper Health System Project) Series 2008A VRDN (TD Bank N.A. LOC),
0.16%, 10/05/12 (a) | | | 3,900 | | | | 3,900,000 | |
New Jersey Environmental Infrastructure Trust RB Floater Series 2012A-R-4729 VRDN (Bank of America N.A. SBPA),
0.21%, 10/05/12 (a)(b)(c) | | | 515 | | | | 515,000 | |
New Jersey Health Care Facilities Financing Authority RB (Meridian IV Project) Series 2007 VRDN (AGM Insurance, Wells Fargo Bank N.A. SBPA), 0.17%, 10/05/12 (a) | | | 700 | | | | 700,000 | |
| | | | | | | | |
| Municipal Bonds | | Par (000) | | | Value | |
New Jersey (concluded) | | | | | | | | |
New Jersey Health Care Facilities Financing Authority RB (Recovery Management Systems, Inc. Project) Series 2005 VRDN (TD Bank N.A. LOC), 0.17%, 10/05/12 (a) | | $ | 1,000 | | | $ | 1,000,000 | |
New Jersey Health Care Facilities Financing Authority RB (RWJ Health Care Corp. Project) Series 2002 VRDN (TD Bank N.A. LOC), 0.16%, 10/05/12 (a) | | | 400 | | | | 400,000 | |
New Jersey Higher Education Assistance Authority Student Loan RBC Municipal Products, Inc. Trust Series 2008L-36 VRDN (Royal Bank of Canada LOC, Royal Bank of Canada SBPA),
0.22%, 10/05/12 (a) | | | 700 | | | | 700,000 | |
New Jersey Housing & Mortgage Finance Agency RB Series 2005O AMT VRDN (Barclays Bank Plc SBPA),
0.18%, 10/05/12 (a) | | | 2,900 | | | | 2,900,000 | |
New Jersey Transportation Trust Fund Authority RB SPEARS (Transportation System Project) Series 2007DB-447 VRDN (Deutsche Bank A.G. SBPA), 0.22%, 10/05/12 (a)(b)(c) | | | 5,745 | | | | 5,745,000 | |
North Wildwood GO Series 2011 BAN, 1.25%, 12/07/12 | | | 1,000 | | | | 1,000,652 | |
Ringwood Borough GO Series 2011 BAN, 1.00%, 11/02/12 | | | 750 | | | | 750,234 | |
Saddle River Borough GO Series 2012 BAN: | | | | | | | | |
1.00%, 3/28/13 | | | 400 | | | | 400,989 | |
1.00%, 8/02/13 | | | 500 | | | | 501,910 | |
Union County Industrial Pollution Control Financing Authority PCRB (Exxon Mobil Corp. Project) Series 1989 VRDN, 0.06%, 10/01/12 (a) | | | 1,755 | | | | 1,755,000 | |
Voorhees Township GO Series 2012 BAN, 1.00%, 8/08/13 | | | 500 | | | | 501,777 | |
Watchung Borough GO Series 2012 BAN, 1.25%, 2/28/13 | | | 600 | | | | 601,785 | |
| | | | | | | | |
| | | | | | | | 45,137,342 | |
Puerto Rico – 3.3% | | | | | | | | |
Commonwealth of Puerto Rico GO Series 2003C5-2 VRDN (Barclays Bank Plc LOC), 0.18%, 10/05/12 (a) | | | 1,750 | | | | 1,750,000 | |
Total Municipal Bonds – 88.6% | | | | | | | 46,887,342 | |
| | | | | | | | |
| | | | | | | | |
| | |
| Closed-End Investment Companies | | | | | | |
New Jersey – 11.3% | | | | | | | | |
Nuveen New Jersey Investment Quality Municipal Fund, Inc. Series 2010-1-1443 VRDP (Citibank N.A. Liquidity Facility), 0.30%, 10/05/12 (a)(b) | | | 4,000 | | | | 4,000,000 | |
Nuveen New Jersey Premium Income Municipal Fund, Inc. Series 2010-1-886 VRDP (Citibank N.A. Liquidity Facility), 0.30%, 10/05/12 (a)(b) | | | 2,000 | | | | 2,000,000 | |
Total Closed-End Investment Companies – 11.3% | | | | 6,000,000 | |
Total Investments (Cost – $52,887,342*) – 99.9% | | | | 52,887,342 | |
Other Assets Less Liabilities – 0.1% | | | | | | | 31,512 | |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 52,918,854 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| 18 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock New Jersey Municipal Money Market Portfolio |
| (b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| • | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| | • | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | • | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| | • | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
| | | | |
Assets: | | | | | | | | |
| | | | |
Investments: | | | | | | | | |
| | | | |
Short-Term Securities1 | | – | | $ 52,887,342 | | – | | $ 52,887,342 |
| | 1 | See above Schedule of Investments for values in the state or political subdivision. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $19,784 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 19 |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock North Carolina Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
North Carolina – 95.8% | | | | | | | | |
Asheville RB Series 2012 MB, 3.00%, 4/01/13 | | $ | 1,450 | | | $ | 1,468,807 | |
Charlotte Housing Authority RB (Oak Park Project) Series 2005 VRDN (Wells Fargo Bank N.A. LOC), 0.18%, 10/05/12 (a) | | | 2,000 | | | | 2,000,000 | |
Charlotte Housing Authority RB (Stonehaven East Project) Series 2005 VRDN (Wells Fargo Bank N.A. LOC), 0.18%,
10/05/12 (a) | | | 200 | | | | 200,000 | |
Charlotte-Mecklenburg Hospital Authority RB (Carolinas Healthcare Project) Austin Trust Series 2008-1149 VRDN (Bank of America N.A. Liquidity Facility), 0.21%,
10/05/12 (a)(b)(c) | | | 2,545 | | | | 2,545,000 | |
Charlotte-Mecklenburg Hospital Authority RB (Carolina’s Healthcare System Project) Series 2005B VRDN (US Bank N.A. LOC),
0.15%, 10/01/12 (a) | | | 400 | | | | 400,000 | |
Charlotte-Mecklenburg Hospital Authority RB (Carolina’s Healthcare System Project) Series 2011-72C VRDN (Wells Fargo Bank N.A. SBPA), 0.20%, 10/05/12 (a)(b) | | | 5,000 | | | | 5,000,000 | |
Mecklenburg County COP Series 2006 VRDN (Branch Banking & Trust Co. SBPA),
0.19%, 10/05/12 (a) | | | 3,500 | | | | 3,500,000 | |
Mecklenburg County GO Series 2009D VRDN,
0.28%, 4/26/13 (a) | | | 3,790 | | | | 3,790,000 | |
New Hanover County RB Series 2012 MB,
1.00%, 12/03/12 | | | 300 | | | | 300,364 | |
North Carolina Capital Facilities Finance Agency Educational Facilities RB (High Point University Project) Series 2006 VRDN (Branch Banking & Trust Co. LOC), 0.19%, 10/05/12 (a) | | | 590 | | | | 590,000 | |
North Carolina Capital Facilities Finance Agency Educational Facilities RB (High Point University Project) Series 2008 VRDN (Branch Banking & Trust Co. LOC), 0.19%, 10/05/12 (a) | | | 800 | | | | 800,000 | |
North Carolina Capital Facilities Finance Agency RB (Aquarium Society Project) Series 2004 VRDN (Bank of America N.A. LOC), 0.22%, 10/05/12 (a) | | | 2,100 | | | | 2,100,000 | |
North Carolina Educational Facilities Finance Agency RB (Duke University Project) Series 1991B VRDN, 0.15%,
10/05/12 (a) | | | 700 | | | | 700,000 | |
North Carolina Educational Facilities Finance Agency RB (Elon College Project) Series 1997 VRDN (TD Bank N.A. LOC), 0.16%,
10/05/12 (a) | | | 500 | | | | 500,000 | |
North Carolina Educational Facilities Finance Agency RB (Elon College Project) Series 2000 VRDN (TD Bank N.A. LOC), 0.16%,
10/05/12 (a) | | | 1,575 | | | | 1,575,000 | |
North Carolina Medical Care Commission Health Care Facilities RBC Municipal Products, Inc. Trust (Duke University Health System Project) Series 2012-O-39 VRDN (Royal Bank of Canada SBPA),
0.18%, 10/05/12 (a)(b)(c) | | | 1,900 | | | | 1,900,000 | |
North Carolina Medical Care Commission Hospital RB (Moses Cone Health System Project) Series 2001B VRDN (BMO Harris Bank N.A. SBPA), 0.18%, 10/01/12 (a) | | | 2,100 | | | | 2,100,000 | |
North Carolina State Public Improvement GO Series 2002G VRDN (Landesbank Hessen-Thuringen Girozentrale SBPA), 0.18%, 10/05/12 (a) | | | 400 | | | | 400,000 | |
Raleigh Comb Enterprise System RB Series 2006 ROC-RR-II R-645 VRDN (Citibank N.A. SBPA), 0.18%, 10/05/12 (a)(b)(c) | | | 3,600 | | | | 3,600,000 | |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
North Carolina (concluded) | | | | | | | | |
Raleigh RB (Comb Enterprise System Project) Series 2008B VRDN (Wells Fargo Bank N.A. SBPA), 0.18%, 10/05/12 (a) | | $ | 5,300 | | | $ | 5,300,000 | |
Raleigh RB Series 2009 VRDN, 0.28%,
4/26/13 (a) | | | 805 | | | | 805,000 | |
Sampson County COP Eclipse Funding Trust Series 2006-0160 VRDN
(U.S. Bank N.A. LOC,
U.S. Bank N.A. SBPA), 0.18%,
10/05/12 (a)(b)(c) | | | 1,900 | | | | 1,900,000 | |
South Central Water & Sewer District GO
Series 2012 BAN, 1.00%, 10/24/12 | | | 2,000 | | | | 2,000,690 | |
University of North Carolina at Chapel Hill RB Series 2001B VRDN, 0.18%, 10/05/12 (a) | | | 405 | | | | 405,000 | |
University of North Carolina at Chapel Hill RB Series 2001B VRDN (Landesbank Hessen-Thuringen Girozentrale SBPA), 0.19%, 10/01/12 (a) | | | 2,000 | | | | 2,000,000 | |
University of North Carolina RB Series 2005A MB, 5.00%, 12/03/12 | | | 100 | | | | 100,791 | |
University of North Carolina RB Series 2012A MB, 2.00%, 4/01/13 | | | 1,095 | | | | 1,104,015 | |
Wake County RB Series 2009D MB,
4.00%, 2/01/13 | | | 150 | | | | 151,825 | |
| | | | | | | | |
| | | | | | | | 47,236,492 | |
Puerto Rico – 2.0% | | | | | | | | |
Commonwealth of Puerto Rico GO Series 2003C5-2 VRDN (Barclays Bank
Plc LOC), 0.18%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
Total Investments (Cost – $48,236,492*) – 97.8% | | | | 48,236,492 | |
Other Assets Less Liabilities – 2.2% | | | | | | | 1,091,585 | |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 49,328,077 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| (b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| | — | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| | — | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | — | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| | — | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| 20 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock North Carolina Municipal Money Market Portfolio |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
Assets: | | | | | | | | |
Investments: | | | | | | | | |
Short-Term Securities1 | | – | | $ 48,236,492 | | – | | $ 48,236,492 |
| | 1 | See above Schedule of Investments for values in the state or political subdivision. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $85,458 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 21 |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock Ohio Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Ohio – 98.8% | | | | | | | | |
Beachwood GO Series 2012 BAN, 1.00%, 8/07/13 | | $ | 700 | | | $ | 704,268 | |
Butler County GO Series 2012 BAN, 0.40%, 8/01/13 | | | 600 | | | | 600,000 | |
Butler County Healthcare Facilities RB
(Lifesphere Project) Series 2002 VRDN
(U.S. Bank N.A. LOC), 0.18%,
10/05/12 (a) | | | 6,450 | | | | 6,450,000 | |
Cleveland Department of Public Utilities Division of Water RB Series 2012, 1.50%, 1/25/13 | | | 1,000 | | | | 1,001,938 | |
Cleveland Waterworks RB Series 2008Q VRDN (The Bank of New York Mellon Corp. LOC), 0.15%, 10/05/12 (a) | | | 800 | | | | 800,000 | |
Cleveland-Cuyahoga County Port Authority RB (Euclid Avenue Housing Corp. Project) Series 2008 VRDN (U.S. Bank N.A. LOC), 0.15%, 10/05/12 (a) | | | 1,900 | | | | 1,900,000 | |
Columbus Sewerage System RB Municipal
Trust Receipts Floaters Series 2008A-13 VRDN (Branch Banking & Trust Co. SBPA), 0.16%, 10/05/12 (a)(b)(c) | | | 5,700 | | | | 5,700,000 | |
Columbus Sewerage System RB PUTTERS
Series 2008-2456 VRDN (JPMorgan
Chase Bank SBPA), 0.19%,
10/05/12 (a)(b)(c) | | | 400 | | | | 400,000 | |
Franklin County Hospital Facilities RB
Municipal Trust Receipts Floaters
(Nationwide Children Hospital Project)
Series 2012A-0-46 (Royal Bank of
Canada SBPA), 0.18%,
10/05/12 (a)(b)(c) | | | 5,200 | | | | 5,200,000 | |
Franklin County RB Municipal Trust Receipts Floaters Series 2011-21B VRDN (Barclays Bank Plc SBPA), 0.18%, 10/05/12 (a)(b)(c) | | | 2,120 | | | | 2,120,000 | |
Independence GO Series 2012 BAN, 1.13%, 4/19/13 | | | 600 | | | | 602,374 | |
Lake County GO Series 2012 BAN, 1.00%, 7/23/13 | | | 1,425 | | | | 1,432,233 | |
Lakewood GO Series 2012 BAN, 1.13%, 10/18/12 | | | 1,150 | | | | 1,150,386 | |
Lima RB (Lima Memorial Hospital Project) Series 2007 VRDN (JPMorgan Chase Bank N.A. LOC), 0.20%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
Miami County GO Series 2012 BAN, 1.13%, 12/03/12 | | | 600 | | | | 600,672 | |
Miamisburg GO Series 2012 BAN, 1.00%, 3/12/13 | | | 1,900 | | | | 1,904,191 | |
North Ridgeville GO (Capital Improvement and Equipment Project) Series 2012 BAN, 0.85%, 4/04/13 | | | 700 | | | | 700,704 | |
Ohio Air Quality Development Authority RB (Dayton Power & Light Project) Series 2008B VRDN (JPMorgan Chase Bank, N.A. LOC), 0.23%, 10/05/12 (a) | | | 2,000 | | | | 2,000,000 | |
Ohio Air Quality Development Authority RB (Ohio Valley Electric Corp. Project) Series 2009D VRDN (Bank of Tokyo-Mitsubishi UFJ Ltd. LOC), 0.18%, 10/05/12 (a) | | | 600 | | | | 600,000 | |
Ohio GO (Common Schools Project) Series 2005A VRDN (Ohio Housing Authority Guaranty), 0.18%, 10/05/12 (a) | | | 4,300 | | | | 4,300,000 | |
Ohio GO (Common Schools Project) Series 2006C VRDN (Ohio Housing Authority Guaranty), 0.15%, 10/05/12 (a) | | | 2,725 | | | | 2,725,000 | |
Ohio GO (Common Schools Project) Series 2011B MB, 3.00%, 9/16/13 | | | 500 | | | | 513,312 | |
Ohio Higher Educational Facility Commission RB (Case Western Reserve University Project) Series 2002A VRDN (Wells Fargo Bank N.A. SBPA), 0.21%, 10/01/12 (a) | | | 1,100 | | | | 1,100,000 | |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Ohio (concluded) | | | | | | | | |
Ohio Higher Educational Facility RB (Cleveland Clinic Project) Series 2008B-4 VRDN, 0.20%, 10/01/12 (a) | | $ | 4,005 | | | $ | 4,005,000 | |
Ohio Higher Educational Facility RB (Ohio Dominican University Project) Series 2007 VRDN (JPMorgan Chase Bank N.A. LOC), 0.19%, 10/05/12 (a) | | | 1,900 | | | | 1,900,000 | |
Ohio RB (Development Assistance Project) Series 2012A BAN, 0.35%, 5/30/13 | | | 400 | | | | 400,000 | |
Ohio RB (Revitalization Project) Series 2012A BAN, 0.35%, 5/30/13 | | | 350 | | | | 350,000 | |
Sharonville GO Series 2012 BAN,
1.00%, 7/11/13 | | | 100 | | | | 100,386 | |
Strongsville GO (Reference Library Project) Series 2011 BAN, 1.25%, 10/25/12 | | | 600 | | | | 600,352 | |
Strongsville GO Series 2011 BAN, 1.25%,
10/25/12 | | | 1,200 | | | | 1,200,705 | |
Trumbull County Health Care Facilities RB Series 2001 VRDN (Manufacturers and Traders Trust Co. LOC), 0.20 %,
10/05/12 (a) | | | 5,200 | | | | 5,200,000 | |
Trumbull County IDRB (Ellwood Engineered Project) Series 2004 AMT VRDN (Wells Fargo Bank N.A. LOC),
0.25%,10/05/12 (a) | | | 3,600 | | | | 3,600,000 | |
| | | | | | | | |
| | | | | | | 60,861,521 | |
|
| |
| |
Puerto Rico – 1.0% | | | | | | | | |
Commonwealth of Puerto Rico GO Series 2003C5-2 VRDN (Barclays Bank Plc LOC), 0.18%, 10/05/12 (a) | | | 600 | | | | 600,000 | |
| |
Total Investments (Cost – $61,461,521*) – 99.8% | | | | 61,461,521 | |
Other Assets Less Liabilities – 0.2% | | | | 112,990 | |
| | | | | | | | |
Net Assets – 100.0% | | | $ | 61,574,511 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| (b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| — | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| | — | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | — | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| | — | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| 22 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock Ohio Municipal Money Market Portfolio |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
Assets: | | | | | | | | |
Investments: | | | | | | | | |
Short-Term Securities1 | | – | | $ 61,461,521 | | – | | $ 61,461,521 |
| | 1 | See above Schedule of Investments for values in the state or political subdivision. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $98,105 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 23 |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock Pennsylvania Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Pennsylvania – 98.5% | | | | | | | | |
Allegheny County Hospital Development Authority RB (University of Pittsburgh Medical Center Project) Series 2010B-2 VRDN (Deutsche Bank A.G. LOC), 0.17%, 10/05/12 (a) | | $ | 12,550 | | | $ | 12,550,000 | |
Allegheny County Hospital Development Authority RB Series 2011A MB, 2.00%, 10/15/12 | | | 1,100 | | | | 1,100,684 | |
Beaver County IDA (PA Electric Co. Project) Series 2005B VRDN (UBS A.G. LOC), 0.19%, 10/01/12 (a) | | | 4,800 | | | | 4,800,000 | |
Berks County IDRB (Tray-Pak Corp. Project) Series 2001A AMT VRDN (Wells Fargo Bank N.A. LOC), 0.39%, 10/05/12 (a) | | | 870 | | | | 870,000 | |
Berks County RB RBC Municipal Products, Inc. Trust Series 2011C-15 VRDN (Royal Bank of Canada LOC, Royal Bank of Canada SBPA), 0.18%, 10/05/12 (a)(b) | | | 4,000 | | | | 4,000,000 | |
Berks County RB Wells Fargo Stage Trust Floaters Series 2012-53C-1-1 VRDN (Wells Fargo Bank N.A. SBPA), 0.20%, 10/05/12 (a)(b)(c) | | | 1,510 | | | | 1,510,000 | |
Blair County IDA RB (Homewood at Martinsburg Project) Series 2004 VRDN (Manufacturers and Traders Trust Co. LOC), 0.22%, 10/05/12 (a) | | | 4,150 | | | | 4,150,000 | |
Central Bradford Progress Authority RB (Robert Packer Hospital Project) Series 2011 VRDN (Royal Bank of Canada LOC, Royal Bank of Canada SBPA), 0.18%, 10/05/12 (a)(b) | | | 6,900 | | | | 6,900,000 | |
Cumberland County Municipal Authority RB (Presbyterian Homes Project) Series 2003B VRDN (Manufacturers and Traders Trust Co. LOC), 0.20%, 10/05/12 (a) | | | 7,880 | | | | 7,880,000 | |
Delaware County IDRB (Resource Recovery Facility Project) Series 1997G VRDN (General Electric Capital Corp. Guaranty), 0.18%, 10/05/12 (a) | | | 16,500 | | | | 16,500,000 | |
Delaware County IDRB (Resource Recovery Facility Project) Series 2000-97G VRDN (General Electric Capital Corp. Guaranty), 0.18%, 10/05/12 (a) | | | 8,235 | | | | 8,235,000 | |
Delaware County IDRB (Resource Recovery Facility Project) Series 2005G VRDN (General Electric Capital Corp. Guaranty), 0.18%, 10/05/12 (a) | | | 4,440 | | | | 4,440,000 | |
Delaware County IDRB (Resource Recovery Facility Project) Series 2009C VRDN (General Electric Capital Corp. Guaranty), 0.18%, 10/05/12 (a) | | | 700 | | | | 700,000 | |
Delaware County IDRB (Resource Recovery Facility Project) Series 2011G VRDN (General Electric Capital Corp. Guaranty), 0.18%, 10/05/12 (a) | | | 4,910 | | | | 4,910,000 | |
Delaware County IDRB (Resource Recovery Project) Series 2012 VRDN (General Electric Capital Corp. Guaranty), 0.18%, 10/05/12 (a) | | | 4,100 | | | | 4,100,000 | |
Delaware County RB (Riddle Village
Project) Series 2006 VRDN (Bank of
America N.A. LOC), 0.21%,
10/05/12 (a) | | | 8,600 | | | | 8,600,000 | |
Delaware River Port Authority RB Series 2010B VRDN (Bank of America N.A. LOC), 0.17%, 10/05/12 (a) | | | 3,200 | | | | 3,200,000 | |
Downingtown Area School District RBC Municipal Products, Inc. Trust Series 2010E-13 VRDN (Royal Bank of Canada SBPA), 0.18%,
10/05/12 (a)(b) | | | 3,600 | | | | 3,600,000 | |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Pennsylvania (continued) | | | | | | | | |
Emmaus General Authority RB (Local Government Project) Series 1989H-22 VRDN (U.S. Bank NA LOC), 0.20%, 10/05/12 (a) | | $ | 1,000 | | | $ | 1,000,000 | |
Emmaus General Authority RB Series 1989F-24 VRDN (U.S. Bank N.A. LOC), 0.20%, 10/05/12 (a) | | | 1,100 | | | | 1,100,000 | |
Emmaus General Authority RB Series 1996 VRDN (AGM Insurance, Wells Fargo Bank N.A. SBPA), 0.24%, 10/05/12 (a) | | | 9,300 | | | | 9,300,000 | |
Erie Water Authority RB Series 2009C Mandatory Put Bonds (Federal Home Loan Bank LOC), 2.50%, 6/01/13 (a) | | | 3,500 | | | | 3,547,069 | |
Erie Water Authority RB Series 2010-2006D Mandatory Put Bonds (Federal Home Loan Bank LOC), 2.50%, 6/01/13 (a) | | | 3,000 | | | | 3,040,345 | |
Franklin County IDRB (Precast System Project) Series 2001A AMT VRDN (Manufacturers and Traders Trust Co. LOC), 0.33%, 10/05/12 (a) | | | 1,510 | | | | 1,510,000 | |
Geisinger Authority Health System RB (Geisinger Health System Project) Series 2005C VRDN (TD Bank N.A. SBPA), 0.16%, 10/01/12 (a) | | | 3,700 | | | | 3,700,000 | |
Haverford Township School District GO Series 2009 VRDN (TD Bank N.A. LOC), 0.18%, 10/05/12 (a) | | | 2,420 | | | | 2,420,000 | |
Lehigh County GO Series 2011 MB,
2.50%, 11/15/12 | | | 1,195 | | | | 1,198,165 | |
Montgomery County IDA RB (Fountain Life Christian Project) Series 2007A VRDN (JPMorgan Chase Bank N.A. LOC), 0.24%, 10/05/12 (a) | | | 3,225 | | | | 3,225,000 | |
Northampton County General Purpose Authority RB (Lehigh University Higher Education Project) Series 2004 VRDN (TD Bank N.A. SBPA), 0.16%, 10/05/12 (a) | | | 800 | | | | 800,000 | |
Northampton County IDRB (Trent Family Partnership Project) Series 2002 AMT VRDN (Wells Fargo Bank N.A. LOC), 0.39%, 10/05/12 (a) | | | 1,395 | | | | 1,395,000 | |
Pennsylvania Clipper Tax-Exempt Certificate Trust RB Series 2007 VRDN (State Street Bank & Trust Co. SBPA), 0.19%, 10/05/12 (a)(b) | | | 27,500 | | | | 27,500,000 | |
Pennsylvania Economic Development Financing Authority RB (Evergreen Community Power Facility Project) Series 2007 AMT VRDN (Manufacturers and Traders Trust Co. LOC), 0.33%, 10/05/12 (a) | | | 13,600 | | | | 13,600,000 | |
Pennsylvania Economic Development Financing Authority RB (Homewood Retirement Project) Series 1992E VRDN (Manufacturers and Traders Trust Co. LOC), 0.22%, 10/05/12 (a) | | | 1,300 | | | | 1,300,000 | |
Pennsylvania Economic Development Financing Authority RB (NHS-AVS LLC Project) Series 2008 VRDN (TD Bank N.A. LOC), 0.20%, 10/01/12 (a) | | | 6,500 | | | | 6,500,000 | |
Pennsylvania Economic Development Financing Authority RB (Solar Innovations Inc. Project) Series 2007 VRDN (Manufacturers and Traders Trust Co. LOC), 0.48%, 10/05/12 (a) | | | 3,905 | | | | 3,905,000 | |
Pennsylvania Higher Educational Facilities Authority RB (Thomas Jefferson University Project) Series 2008B VRDN (JPMorgan Chase Bank N.A. LOC), 0.19%, 10/05/12 (a) | | | 1,635 | | | | 1,635,000 | |
Pennsylvania Higher Educational Facilities Authority RB PUTTERS (Trustees of the University of Pennsylvania Project) Series 2008-2844 VRDN (JPMorgan Chase Bank N.A. SBPA), 0.19%,
10/05/12 (a)(c) | | | 1,605 | | | | 1,605,000 | |
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| 24 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments (continued) | | BlackRock Pennsylvania Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Pennsylvania (continued) | | | | | | | | |
Pennsylvania Housing Finance Agency RB (Single Family Mortgage Project) Series 2002-75A VRDN (Barclays Bank Plc SBPA), 0.19%, 10/05/12 (a) | | $ | 4,565 | | | $ | 4,565,000 | |
Pennsylvania Housing Finance Agency RB Series 2004-81C VRDN (Royal Bank of Canada SBPA), 0.18%, 10/05/12 (a) | | | 2,750 | | | | 2,750,000 | |
Pennsylvania Housing Finance Agency RB Series 2004-83C AMT VRDN (Bank of Tokyo-Mitsubishi UFJ Ltd. SBPA), 0.19%,
10/05/12 (a) | | | 1,500 | | | | 1,500,000 | |
Pennsylvania Housing Finance Agency RB Series 2005-91B VRDN (Bank of Tokyo-Mitsubishi UFJ Ltd. SBPA), 0.19%,
10/05/12 (a) | | | 7,370 | | | | 7,370,000 | |
Pennsylvania Housing Finance Agency Single Family Mortgage RB PUTTERS Series 2009-3297 AMT VRDN (JPMorgan Chase Bank N.A. SBPA), 0.27%,
10/05/12 (a)(b)(c) | | | 555 | | | | 555,000 | |
Pennsylvania State Turnpike Commission RB SPEARS Series 2012DBE-1096 VRDN (Deutsche Bank A.G. Guaranty, Deutsche Bank A.G. SBPA), 0.23%,
10/05/12 (a)(b)(c) | | | 4,740 | | | | 4,740,000 | |
Pennsylvania Turnpike Commission RB (Multi-Modal Project) Series 2010A-1 VRDN (JPMorgan Chase Bank N.A. SBPA), 0.19%, 10/05/12 (a) | | | 2,950 | | | | 2,950,000 | |
Pennsylvania Turnpike Commission RB RBC Municipal Products, Inc. Trust Series 2011E-22 VRDN (Royal Bank of Canada LOC, Royal Bank of Canada SBPA),
0.18%, 10/05/12 (a)(b) | | | 4,300 | | | | 4,300,000 | |
Pennsylvania Turnpike Commission RB Series 2009 ROC-RR-II R-12259 VRDN (Berkshire Hathaway Assurance Corp. Insurance, Citibank N.A. SBPA), 0.19%,
10/01/12 (a)(b)(c) | | | 5,000 | | | | 5,000,000 | |
Pennsylvania Turnpike Commission RB Series 2009A MB (AGM Insurance), 3.00%, 6/03/13 | | | 1,800 | | | | 1,832,834 | |
Pennsylvania Turnpike Commission RB Series 2011D MB, 0.23%, 12/01/12 (a) | | | 6,500 | | | | 6,500,000 | |
Philadelphia Authority IDRB (Girard Estate Facilities Leasing Project) Series 2001 VRDN (JPMorgan Chase Bank N.A. LOC), 0.24%, 10/05/12 (a) | | | 3,800 | | | | 3,800,000 | |
Philadelphia Authority IDRB (Liberty Lutheran Services Project) Series 2008 VRDN (Bank of America N.A. LOC), 0.21%, 10/05/12 (a) | | | 2,900 | | | | 2,900,000 | |
Philadelphia Authority IDRB (Universal Community Homes Project) Series 2003 VRDN (Wells Fargo Bank N.A. LOC), 0.34%, 10/05/12 (a) | | | 690 | | | | 690,000 | |
Philadelphia Gas Works RB Series 2004A-2 VRDN (JPMorgan Chase Bank N.A. LOC), 0.18%, 10/05/12 (a) | | | 1,300 | | | | 1,300,000 | |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Pennsylvania (concluded) | | | | | | | | |
Philadelphia GO (Multi-Modal Project) Series 2009B VRDN (Royal Bank of Canada LOC), 0.16%, 10/05/12 (a) | | $ | 2,600 | | | $ | 2,600,000 | |
Philadelphia Hospitals & Higher Education Facilities Authority RB (Childrens Hospital of Philadelphia Project) Series 2011A VRDN (JP Morgan Chase Bank N.A. SBPA), 0.20%, 10/01/12 (a) | | | 1,100 | | | | 1,100,000 | |
Philadelphia School District GO Series 2011F VRDN (Barclays Bank Plc LOC), 0.18%, 10/05/12 (a) | | | 16,000 | | | | 16,000,000 | |
Phoenixville Area School District GO Series 2012A MB, 2.00%, 5/15/13 | | | 735 | | | | 742,292 | |
Pittsburgh Water & Sewer Authority RB Series 2009C-1A Mandatory Put Bonds (Federal Home Loan Bank LOC, Northwestern Savings Bank LOC), 0.40%, 9/01/13 (a) | | | 5,100 | | | | 5,100,000 | |
Swarthmore Borough Authority RB Series 2008 MB, 5.00%, 9/16/13 | | | 100 | | | | 104,468 | |
Unionville-Chadds Ford School District GO Series 2012 MB, 1.00%, 6/03/13 | | | 1,720 | | | | 1,727,465 | |
York County Hospital Authority RB (Homewood Retirement Centers of The United Church of Christ, Inc. Project) Series 1990 VRDN (Manufacturers and Traders Trust Co. LOC), 0.17%, 10/05/12 (a) | | | 1,620 | | | | 1,620,000 | |
York County IDRB (Allied-Signal, Inc. Project) Series 1993 VRDN (Allied-Signal, Inc. Guaranty), 0.24%, 10/05/12 (a) | | | 1,000 | | | | 1,000,000 | |
York County IDRB (Interstate Holdings Co. Project) Series 2003 AMT VRDN (Wells Fargo Bank N.A. LOC), 0.39%, 10/05/12 (a) | | | 975 | | | | 975,000 | |
| | | | | | | | |
| | | | | | | 268,048,322 | |
| |
Puerto Rico – 0.2% | | | | | | | | |
Commonwealth of Puerto Rico GO Series 2007A-2 VRDN (AGM Insurance, JPMorgan Chase Bank N.A. SBPA), 0.24%, 10/05/12 (a) | | | 400 | | | | 400,000 | |
| |
| | |
Total Municipal Bonds – 98.7% | | | | | | | 268,448,322 | |
| |
|
| |
| | | | | | | | |
| | |
Closed-End Investment Companies | | | | | | | | |
| |
Pennsylvania – 2.0% | | | | | | | | |
Nuveen Pennsylvania Investment Quality Municipal Fund, Inc. Series 2010-1-1125 VRDP (Citibank N.A. Liquidity Facility), 0.30%, 10/05/12 (a)(b) | | | 3,000 | | | | 3,000,000 | |
Nuveen Pennsylvania Premium Income Municipal Fund, Inc. II Series 2010-1-1000 VRDP (Citibank N.A. Liquidity Facility), 0.30%, 10/05/12 (a)(b) | | | 2,500 | | | | 2,500,000 | |
| |
| |
Total Closed-End Investment Companies – 2.0% | | | | 5,500,000 | |
| |
Total Investments (Cost – $273,948,322*) – 100.7% | | | | 273,948,322 | |
Liabilities in Excess of Other Assets – (0.7)% | | | | (1,789,478 | ) |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 272,158,844 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 25 |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock Pennsylvania Municipal Money Market Portfolio |
| (a) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| (b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| — | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes as follows: |
| | — | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | — | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| | — | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to the Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | | | | | | | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
Assets: | | | | | | | | | | | | | | | | | | | | |
Investments: | | | | | | | | | | | | | | | | | | | | |
Short-Term Securities1 | | | | – | | | | $ | 273,948,322 | | | | | – | | | | $ | 273,948,322 | |
| | 1 | See above Schedule of Investments for values in the state or political subdivision. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $30,317 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
| | | | | | |
| See Notes to Financial Statements. | | | | |
| | | | | | | |
| 26 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Schedule of Investments September 30, 2012 (Unaudited) | | BlackRock Virginia Municipal Money Market Portfolio (Percentages shown are based on Net Assets) |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Virginia – 89.1% | | | | | | | | |
Alexandria IDRB (Goodwin House Project) Series 2005 VRDN (Wells Fargo Bank N.A. LOC), 0.20%, 10/01/12 (a) | | $ | 900 | | | $ | 900,000 | |
Alexandria IDRB (YMCA of Billings Project) Series 1998 VRDN (Manufacturers and Traders Trust Co. LOC), 0.22%, 10/05/12 (a) | | | 1,350 | | | | 1,350,000 | |
Arlington County IDRB (Woodbury Park Project) Series 2005A VRDN (Freddie Mac Guaranty), 0.18%, 10/05/12 (a) | | | 1,600 | | | | 1,600,000 | |
Fairfax County Economic Development Authority Health Care Facilities RB (Capital Hospice Project) Series 2009 VRDN (Branch Banking & Trust Co. LOC), 0.19%, 10/05/12 (a) | | | 650 | | | | 650,000 | |
Fairfax County IDA RB (Inova Health Systems Project) Series 2005C-1 VRDN (JPMorgan Chase Bank N.A. SBPA), 0.20%, 10/01/12 (a) | | | 600 | | | | 600,000 | |
Hampton Redevelopment & Housing Authority RB (Multi-Family Housing Project) Series 1998 VRDN (Fannie Mae Guaranty), 0.17%, 10/05/12 (a) | | | 325 | | | | 325,000 | |
Loudoun County IDA RB (Howard Hughes
Medical Institute Project) Series 2003B
VRDN, 0.18%, 10/05/12 (a) | | | 650 | | | | 650,000 | |
Louisa County IDRB (Pooled Financing Project) Series 1995 VRDN (Bank of America N.A. LOC), 0.36%, 10/05/12 (a) | | | 715 | | | | 715,000 | |
Richmond IDA RB (Crow-Klein Project) Series 1987A Mandatory Put Bonds (Wells Fargo Bank N.A. LOC), 0.45%, 11/15/12 (a) | | | 1,160 | | | | 1,160,000 | |
Richmond Utility RB Series 2009 ROC-RR-II-R-10410 VRDN (AGM Insurance, Citibank N.A. SBPA), 0.20%,
10/05/12 (a)(b)(c) | | | 650 | | | | 650,000 | |
Roanoke Economic Development Authority RB (Carilion Health System Project) Series 2005A-1 VRDN (AGM Insurance), 0.20%, 10/01/12 (a) | | | 500 | | | | 500,000 | |
Stafford County & Staunton IDA RB (Vaco Commonwealth Loans Project) Series 2009A-1 VRDN (U.S. Bank N.A. LOC), 0.18%, 10/05/12 (a) | | | 815 | | | | 815,000 | |
Virginia Beach Development Authority IDRB (Ocean Ranch Motel Corp. Project) Series 1998 VRDN (Branch Banking & Trust Co. LOC), 0.19%, 10/05/12 (a) | | | 400 | | | | 400,000 | |
Virginia College Building Authority Educational Facilities RB (21st Century College & Equipment Program Project) Series 2006C VRDN (Wells Fargo Bank N.A. SBPA), 0.21%, 10/01/12 (a) | | | 500 | | | | 500,000 | |
Virginia College Building Authority RB (21st Century College & Equipment Project) Barclays Municipal Trust Receipts Floater Series 2009-4B-REG D VRDN (Barclays Bank Plc SBPA), 0.24%, 10/05/12 (a)(b)(c) | | | 2,000 | | | | 2,000,000 | |
Virginia College Building Authority RB (21st Century College Equipment Project) Series 2003A MB (State Appropriate Insurance), 5.00%, 2/01/13 | | | 500 | | | | 507,894 | |
Virginia Commonwealth Transportation Board Clipper Tax-Exempt Certificates Trust Series 2007A-2009-38 VRDN (State Street Bank & Trust Co. SBPA), 0.18%, 10/05/12 (a)(b) | | | | | | | | |
| | | 1,600 | | | | 1,600,000 | |
| | | | | | | | |
| Municipal Bonds | | Par
(000) | | | Value | |
Virginia (concluded) | | | | | | | | |
Virginia Resources Authority RB (State Revolving Fund Project) Series 2009 MB, 3.00%, 10/01/12 | | $ | 250 | | | $ | 250,000 | |
Winchester Authority Residential Care Facility IDRB (Westminster-Canterbury Project) Series 2005B VRDN (Branch Banking & Trust Co. LOC), 0.19%, 10/05/12 (a) | | | 600 | | | | 600,000 | |
| | | | | | | | |
| | | | | | | | 15,772,894 | |
| | |
Puerto Rico – 3.1% | | | | | | | | |
Commonwealth of Puerto Rico GO Series 2007A-2 VRDN (AGM Insurance, JPMorgan Chase Bank N.A. SBPA), 0.24%, 10/05/12 (a) | | | 550 | | | | 550,000 | |
| |
Total Investments (Cost – $16,322,894*) – 92.2% | | | | 16,322,894 | |
Other Assets Less Liabilities – 7.8% | | | | | | | 1,386,782 | |
| | | | | | | | |
Net Assets – 100.0% | | | | | | $ | 17,709,676 | |
| | | | | | | | |
| * | Cost for federal income tax purposes. |
| (a) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| (b) | Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (c) | These securities are short-term floating rate certificates issued by tender option bond trusts and are secured by the underlying municipal bond securities. |
| | — | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows: |
| | — | Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the Fund has the ability to access |
| | — | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs) |
| | — | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 27 |
| | |
| | |
Schedule of Investments (concluded) | | BlackRock Virginia Municipal Money Market Portfolio |
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of September 30, 2012:
| | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total |
Assets: | | | | | | | | |
Investments: | | | | | | | | |
Short-Term Securities1 | | – | | $ 16,322,894 | | – | | $ 16,322,894 |
| | 1 | See above Schedule of Investments for values in the state or political subdivision. |
Certain of the Fund’s assets are held at carrying amount, which approximates fair value for financial statement purposes. As of September 30, 2012, cash of $1,397,915 is categorized as Level 1 within the disclosure hierarchy.
There were no transfers between levels during the six months ended September 30, 2012.
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| 28 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Statements of Assets and Liabilities | | |
| | | | | | | | | | | | | | | | |
| September 30, 2012 (Unaudited) | | BlackRock
Money Market
Portfolio | | | BlackRock
U.S. Treasury
Money Market
Portfolio | | | BlackRock
Municipal
Money Market
Portfolio | | | BlackRock
New Jersey
Municipal
Money Market
Portfolio | |
|
| |
Assets | | | | | | | | | | | | | | | | |
| | | | |
Investments at value1 | | $ | 1,366,213,033 | | | $ | 158,266,633 | | | $ | 113,172,711 | | | $ | 52,887,342 | |
Repurchase agreements at value2 | | | 56,717,000 | | | | 158,476,000 | | | | – | | | | – | |
Cash | | | 11,812 | | | | 92 | | | | 17,144 | | | | 19,784 | |
Capital shares sold receivable | | | 261,349 | | | | 17,003 | | | | 10 | | | | – | |
Interest receivable | | | 1,173,366 | | | | 48,146 | | | | 122,693 | | | | 57,109 | |
Receivable from Manager | | | 149,679 | | | | 35,073 | | | | 13,597 | | | | 5,205 | |
Prepaid expenses | | | 76,275 | | | | 28,334 | | | | 27,499 | | | | 7,683 | |
| | | | |
Total assets | | | 1,424,602,514 | | | | 316,871,281 | | | | 113,353,654 | | | | 52,977,123 | |
| | | | |
|
| |
Liabilities | | | | | | | | | | | | | | | | |
Capital shares redeemed payable | | | 650,815 | | | | 337,522 | | | | – | | | | – | |
Other affiliates payable | | | 353,543 | | | | 90,251 | | | | 34,332 | | | | 14,476 | |
Investment advisory fees payable | | | 251,232 | | | | 13,149 | | | | 5,783 | | | | 743 | |
Professional fees payable | | | 35,492 | | | | 20,914 | | | | 20,748 | | | | 29,185 | |
Officer’s and Trustees’ fees payable | | | 9,262 | | | | 3,195 | | | | 1,741 | | | | 1,220 | |
Other accrued expenses payable | | | 184,975 | | | | 37,449 | | | | 25,532 | | | | 12,645 | |
| | | | |
Total liabilities | | | 1,485,319 | | | | 502,480 | | | | 88,136 | | | | 58,269 | |
| | | | |
Net Assets | | $ | 1,423,117,195 | | | $ | 316,368,801 | | | $ | 113,265,518 | | | $ | 52,918,854 | |
| | | | |
|
| |
Net Assets Consist of | | | | | | | | | | | | | | | | |
Paid-in capital | | $ | 1,423,089,004 | | | $ | 316,362,421 | | | $ | 113,269,683 | | | $ | 52,918,854 | |
Undistributed net investment income | | | 6,686 | | | | 61 | | | | 41 | | | | – | |
Accumulated net realized gain (loss) | | | 21,505 | | | | 6,319 | | | | (4,206 | ) | | | – | |
| | | | |
Net Assets | | $ | 1,423,117,195 | | | $ | 316,368,801 | | | $ | 113,265,518 | | | $ | 52,918,854 | |
| | | | |
| | | | |
| 1 Investments at cost | | $ | 1,366,213,033 | | | $ | 158,266,633 | | | $ | 113,172,711 | | | $ | 52,887,342 | |
| 2 Repurchase agreements at cost | | $ | 56,717,000 | | | $ | 158,476,000 | | | | – | | | | – | |
| | | | | | |
See Notes to Financial Statements. | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 29 |
| | |
| | |
Statements of Assets and Liabilities (continued) | | |
| | | | | | | | | | | | | | | | |
| September 30, 2012 (Unaudited) | | BlackRock
Money Market
Portfolio | | | BlackRock
U.S. Treasury
Money Market
Portfolio | | | BlackRock
Municipal
Money Market
Portfolio | | | BlackRock
New Jersey
Municipal
Money Market
Portfolio | |
|
| |
Net Asset Value | | | | | | | | | | | | | | | | |
Institutional | | | | | | | | | | | | | | | | |
Net assets | | $ | 763,642,412 | | | $ | 168,017,862 | | | $ | 72,280,877 | | | $ | 37,014,207 | |
| | | | |
Shares outstanding3 | | | 763,660,329 | | | | 168,052,407 | | | | 72,258,414 | | | | 36,989,959 | |
| | | | |
Net asset value | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
| | | | |
| | | | |
Service | | | | | | | | | | | | | | | | |
Net assets | | $ | 312,842,800 | | | $ | 127,033,281 | | | $ | 39,422,533 | | | $ | 15,846,834 | |
| | | | |
Shares outstanding3 | | | 312,848,965 | | | | 127,054,688 | | | | 39,413,735 | | | | 15,837,307 | |
| | | | |
Net asset value | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
| | | | |
| | | | |
Investor A | | | | | | | | | | | | | | | | |
Net assets | | $ | 315,237,199 | | | $ | 21,317,658 | | | $ | 1,562,108 | | | $ | 57,813 | |
| | | | |
Shares outstanding3 | | | 315,237,770 | | | | 21,321,503 | | | | 1,561,720 | | | | 57,776 | |
| | | | |
Net asset value | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
| | | | |
| | | | |
Investor B | | | | | | | | | | | | | | | | |
Net assets | | $ | 5,232,778 | | | | – | | | | – | | | | – | |
| | | | |
Shares outstanding3 | | | 5,232,809 | | | | – | | | | – | | | | – | |
| | | | |
Net asset value | | $ | 1.00 | | | | – | | | | – | | | | – | |
| | | | |
| | | | |
Investor C | | | | | | | | | | | | | | | | |
Net assets | | $ | 26,162,006 | | | | – | | | | – | | | | – | |
| | | | |
Shares outstanding3 | | | 26,162,388 | | | | – | | | | – | | | | – | |
| | | | |
Net asset value | | $ | 1.00 | | | | – | | | | – | | | | – | |
| | | | |
| | |
| 3 Unlimited number of shares authorized, $0.001 par value. | | | | | | | | | |
| | | | | | |
See Notes to Financial Statements. | | | | |
| | | | | | | |
| 30 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Statements of Assets and Liabilities (concluded) | | |
| | | | | | | | | | | | | | | | |
| September 30, 2012 (Unaudited) | | BlackRock
North Carolina
Municipal
Money Market
Portfolio | | | BlackRock
Ohio
Municipal
Money Market
Portfolio | | | BlackRock
Pennsylvania
Municipal
Money Market
Portfolio | | | BlackRock
Virginia
Municipal
Money Market
Portfolio | |
|
| |
Assets | | | | | | | | | | | | | | | | |
Investments at value1 | | $ | 48,236,492 | | | $ | 61,461,521 | | | $ | 273,948,322 | | | $ | 16,322,894 | |
Cash | | | 85,458 | | | | 98,105 | | | | 30,317 | | | | 1,397,915 | |
Investments sold receivable | | | 1,000,154 | | | | – | | | | – | | | | – | |
Capital shares sold receivable | | | – | | | | 200 | | | | – | | | | – | |
Interest receivable | | | 41,303 | | | | 65,957 | | | | 159,322 | | | | 11,176 | |
Receivable from Manager | | | 615 | | | | 5,218 | | | | 25,627 | | | | 3,023 | |
Prepaid expenses | | | 5,619 | | | | 5,806 | | | | 13,413 | | | | 6,929 | |
| | | | |
Total assets | | | 49,369,641 | | | | 61,636,807 | | | | 274,177,001 | | | | 17,741,937 | |
| | | | |
|
| |
Liabilities | | | | | | | | | | | | | | | | |
Investments purchased payable | | | – | | | | – | | | | 1,832,169 | | | | – | |
Investment advisory fees payable | | | – | | | | 1,769 | | | | 20,406 | | | | – | |
Professional fees payable | | | 29,490 | | | | 25,032 | | | | 30,755 | | | | 23,493 | |
Other affiliates payable | | | 3,521 | | | | 16,809 | | | | 82,333 | | | | 2,384 | |
Officer’s and Trustees’ fees payable | | | 1,094 | | | | 1,659 | | | | 3,455 | | | | 1,048 | |
Other accrued expenses payable | | | 7,459 | | | | 17,027 | | | | 49,039 | | | | 5,336 | |
| | | | |
Total liabilities | | | 41,564 | | | | 62,296 | | | | 2,018,157 | | | | 32,261 | |
| | | | |
Net Assets | | $ | 49,328,077 | | | $ | 61,574,511 | | | $ | 272,158,844 | | | $ | 17,709,676 | |
| | | | |
|
| |
Net Assets Consist of | | | | | | | | | | | | | | | | |
Paid-in capital | | $ | 49,350,948 | | | $ | 61,574,511 | | | $ | 272,158,788 | | | $ | 17,709,676 | |
Undistributed net investment income | | | – | | | | – | | | | 56 | | | | – | |
Accumulated net realized (loss) | | | (22,871 | ) | | | – | | | | – | | | | – | |
| | | | |
Net Assets | | $ | 49,328,077 | | | $ | 61,574,511 | | | $ | 272,158,844 | | | $ | 17,709,676 | |
| | | | |
| | | | |
| 1 Investments at cost | | $ | 48,236,492 | | | $ | 61,461,521 | | | $ | 273,948,322 | | | $ | 16,322,894 | |
| |
| | | | | |
Net Asset Value | | | | | | | | | | | | | | | | |
Institutional | | | | | | | | | | | | | | | | |
Net assets | | $ | 49,259,172 | | | $ | 53,233,153 | | | $ | 255,056,333 | | | $ | 17,709,676 | |
| | | | |
Shares outstanding2 | | | 49,277,408 | | | | 53,193,471 | | | | 255,002,880 | | | | 17,691,317 | |
| | | | |
Net asset value | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
| | | | |
Service | | | | | | | | | | | | | | | | |
Net assets | | $ | 27,410 | | | $ | 8,337,066 | | | $ | 17,040,821 | | | | – | |
| | | | |
Shares outstanding2 | | | 27,418 | | | | 8,335,910 | | | | 17,038,513 | | | | – | |
| | | | |
Net asset value | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | | – | |
| | | | |
Investor A | | | | | | | | | | | | | | | | |
Net assets | | $ | 41,495 | | | $ | 4,292 | | | $ | 61,690 | | | | – | |
| | | | |
Shares outstanding2 | | | 41,511 | | | | 4,289 | | | | 61,672 | | | | – | |
| | | | |
Net asset value | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | | – | |
| | | | |
| | |
| 2 Unlimited number of shares authorized, $0.001 par value. | | | | | | | | | |
| | | | | | |
See Notes to Financial Statements. | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 31 |
| | | | | | | | | | | | | | | | |
| Six Months Ended September 30, 2012 (Unaudited) | | BlackRock
Money Market
Portfolio | | | BlackRock
U.S. Treasury
Money Market
Portfolio | | | BlackRock
Municipal
Money Market
Portfolio | | | BlackRock
New Jersey
Municipal
Money Market
Portfolio | |
|
| |
Investment Income | | | | | | | | | | | | | | | | |
Income | | $ | 2,157,479 | | | $ | 237,700 | | | $ | 145,885 | | | $ | 72,035 | |
| | | | |
|
| |
Expenses | | | | | | | | | | | | | | | | |
Investment advisory | | | 3,062,608 | | | | 706,391 | | | | 269,462 | | | | 121,961 | |
Transfer agent – class specific | | | 995,404 | | | | 205,443 | | | | 94,557 | | | | 38,509 | |
Service and distribution – class specific | | | 968,462 | | | | 161,278 | | | | 57,885 | | | | 18,762 | |
Administration | | | 461,845 | | | | 117,732 | | | | 44,910 | | | | 20,327 | |
Administration – class specific | | | 164,187 | | | | 39,244 | | | | 14,970 | | | | 6,776 | |
Registration | | | 62,482 | | | | 19,937 | | | | 23,256 | | | | 5,185 | |
Professional | | | 22,701 | | | | 17,120 | | | | 21,591 | | | | 22,942 | |
Officer and Trustees | | | 20,638 | | | | 5,589 | | | | 3,221 | | | | 2,226 | |
Miscellaneous | | | 89,515 | | | | 46,294 | | | | 15,723 | | | | 10,606 | |
| | | | |
Total expenses | | | 5,847,842 | | | | 1,319,028 | | | | 545,575 | | | | 247,294 | |
Less fees waived by Manager | | | (1,562,562 | ) | | | (671,525 | ) | | | (232,299 | ) | | | (111,082 | ) |
Less administration fees waived | | | – | | | | (3,894 | ) | | | – | | | | (196 | ) |
Less administration fees waived – class specific | | | (164,187 | ) | | | (39,244 | ) | | | (14,970 | ) | | | (6,776 | ) |
Less transfer agent fees waived – class specific | | | (14,775 | ) | | | (893 | ) | | | (425 | ) | | | (84 | ) |
Less transfer agent fees reimbursed – class specific | | | (980,629 | ) | | | (204,550 | ) | | | (94,132 | ) | | | (38,369 | ) |
Less service and distribution fees waived – class specific | | | (968,462 | ) | | | (161,278 | ) | | | (57,885 | ) | | | (18,762 | ) |
| | | | |
| | | | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 2,157,227 | | | | 237,644 | | | | 145,864 | | | | 72,025 | |
| | | | |
Net investment income | | | 252 | | | | 56 | | | | 21 | | | | 10 | |
| | | | |
|
| |
Realized Gain | | | | | | | | | | | | | | | | |
Net realized gain from investments | | | 10,775 | | | | 5,509 | | | | 2,240 | | | | – | |
| | | | |
Net Increase in Net Assets Resulting from Operations | | $ | 11,027 | | | $ | 5,565 | | | $ | 2,261 | | | $ | 10 | |
| | | | |
| | | | | | |
See Notes to Financial Statements. | | | | |
| | | | | | | |
| 32 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Statements of Operations (concluded) | | |
| | | | | | | | | | | | | | | | |
| Six Months Ended September 30, 2012 (Unaudited) | | BlackRock
North Carolina
Municipal
Money Market
Portfolio | | | BlackRock
Ohio
Municipal
Money Market
Portfolio | | | BlackRock
Pennsylvania
Municipal
Money Market
Portfolio | | | BlackRock
Virginia
Municipal
Money Market
Portfolio | |
|
| |
Investment Income | | | | | | | | | | | | | | | | |
Income | | $ | 53,789 | | | $ | 74,960 | | | $ | 289,772 | | | $ | 21,910 | |
| | | | |
|
| |
Expenses | | | | | | | | | | | | | | | | |
Investment advisory | | | 118,515 | | | | 139,406 | | | | 579,725 | | | | 43,713 | |
Professional | | | 22,860 | | | | 19,852 | | | | 23,299 | | | | 17,674 | |
Administration | | | 19,753 | | | | 23,234 | | | | 96,621 | | | | 7,286 | |
Administration – class specific | | | 6,584 | | | | 7,745 | | | | 32,206 | | | | 2,428 | |
Transfer agent – class specific | | | 4,786 | | | | 42,796 | | | | 207,624 | | | | 5,999 | |
Registration | | | 4,577 | | | | 4,039 | | | | 6,311 | | | | 5,393 | |
Officer and Trustees | | | 2,121 | | | | 2,517 | | | | 5,318 | | | | 1,824 | |
Service and distribution – class specific | | | 167 | | | | 6,283 | | | | 20,203 | | | | – | |
Miscellaneous | | | 8,260 | | | | 10,218 | | | | 20,875 | | | | 6,693 | |
| | | | |
Total expenses | | | 187,623 | | | | 256,090 | | | | 992,182 | | | | 91,010 | |
Less fees waived by Manager | | | (116,947 | ) | | | (124,216 | ) | | | (442,424 | ) | | | (43,713 | ) |
Less administration fees waived | | | (5,378 | ) | | | (109 | ) | | | – | | | | (7,156 | ) |
Less administration fees waived – class specific | | | (6,584 | ) | | | (7,745 | ) | | | (32,206 | ) | | | (2,428 | ) |
Less transfer agent fees waived – class specific | | | (95 | ) | | | (132 | ) | | | (516 | ) | | | (51 | ) |
Less transfer agent fees reimbursed – class specific | | | (4,673 | ) | | | (42,656 | ) | | | (207,108 | ) | | | (5,948 | ) |
Less service and distribution fees waived – class specific | | | (167 | ) | | | (6,283 | ) | | | (20,203 | ) | | | – | |
Less expenses reimbursed by Manager | | | – | | | | – | | | | – | | | | (9,885 | ) |
| | | | |
| | | | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 53,779 | | | | 74,949 | | | | 289,725 | | | | 21,829 | |
| | | | |
Net investment income | | | 10 | | | | 11 | | | | 47 | | | | 81 | |
| | | | |
|
| |
Realized Gain | | | | | | | | | | | | | | | | |
Net realized gain from investments | | | – | | | | – | | | | – | | | | – | |
| | | | |
Net Increase in Net Assets Resulting from Operations | | $ | 10 | | | $ | 11 | | | $ | 47 | | | $ | 81 | |
| | | | |
| | | | | | |
See Notes to Financial Statements. | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 33 |
| | |
| | |
Statements of Changes in Net Assets | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | BlackRock
Money Market Portfolio | | | BlackRock
U.S. Treasury
Money Market Portfolio | | | BlackRock
Municipal
Money Market Portfolio | |
| | | | | | |
| Increase (Decrease) in Net Assets: | | Six Months Ended
September 30,
2012 (Unaudited) | | | Year Ended
March 31, 2012 | | | Six Months Ended
September 30, 2012 (Unaudited) | | | Year Ended
March 31, 2012 | | | Six Months Ended September 30, 2012 (Unaudited) | | | Year Ended
March 31, 2012 | |
|
| |
| Operations | | | | | | | | | | | | | | | | | | | | | | | | |
Net investment income | | $ | 252 | | | $ | 7,226 | | | $ | 56 | | | $ | 188 | | | $ | 21 | | | $ | 81 | |
Net realized gain | | | 10,775 | | | | 11,762 | | | | 5,509 | | | | 3,770 | | | | 2,240 | | | | 1,940 | |
| | | | | | | | | | | | |
Net increase in net assets resulting from operations | | | 11,027 | | | | 18,988 | | | | 5,565 | | | | 3,958 | | | | 2,261 | | | | 2,021 | |
| | | | | | | | | | | | |
|
| |
| Dividends and Distributions to Shareholders From | |
Net investment income: | | | | | | | | | | | | | | | | | | | | | | | | |
Institutional | | | (128 | ) | | | (297 | ) | | | (32 | ) | | | (72 | ) | | | (12 | ) | | | (3,030 | ) |
Service | | | (58 | ) | | | (109 | ) | | | (20 | ) | | | (41 | ) | | | (9 | ) | | | (4,980 | ) |
Hilliard Lyons | | | – | | | | (2 | ) | | | – | | | | – | | | | – | | | | (3 | ) |
Investor A | | | (59 | ) | | | (117 | ) | | | (4 | ) | | | (14 | ) | | | – | | | | (46 | ) |
Investor B | | | (2 | ) | | | (3 | ) | | | – | | | | – | | | | – | | | | – | |
Investor C | | | (5 | ) | | | (12 | ) | | | – | | | | – | | | | – | | | | – | |
Net realized gain: | | | | | | | | | | | | | | | | | | | | | | | | |
Institutional | | | – | | | | (3,446 | ) | | | – | | | | (1,794 | ) | | | – | | | | – | |
Service | | | – | | | | (951 | ) | | | – | | | | (954 | ) | | | – | | | | – | |
Investor A | | | – | | | | (1,269 | ) | | | – | | | | (212 | ) | | | – | | | | – | |
Investor B | | | – | | | | (29 | ) | | | – | | | | – | | | | – | | | | – | |
Investor C | | | – | | | | (162 | ) | | | – | | | | – | | | | – | | | | – | |
| | | | | | | | | | | | |
Decrease in net assets resulting from dividends and distributions to shareholders | | | (252 | ) | | | (6,397 | ) | | | (56 | ) | | | (3,087 | ) | | | (21 | ) | | | (8,059 | ) |
| | | | | | | | | | | | |
|
| |
| Capital Share Transactions | | | | | | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in net assets derived from capital share transactions | | | (34,661,570 | ) | | | (95,530,331 | ) | | | 7,460,870 | | | | (48,520,158 | ) | | | (22,993,520 | ) | | | 27,385,114 | |
| | | | | | | | | | | | |
|
| |
| Net Assets | | | | | | | | | | | | | | | | | | | | | | | | |
Total increase (decrease) in net assets | | | (34,650,795 | ) | | | (95,517,740 | ) | | | 7,466,379 | | | | (48,519,287 | ) | | | (22,991,280 | ) | | | 27,379,076 | |
Beginning of period | | | 1,457,767,990 | | | | 1,553,285,730 | | | | 308,902,422 | | | | 357,421,709 | | | | 136,256,798 | | | | 108,877,722 | |
| | | | | | | | | | | | |
End of period | | $ | 1,423,117,195 | | | $ | 1,457,767,990 | | | $ | 316,368,801 | | | $ | 308,902,422 | | | $ | 113,265,518 | | | $ | 136,256,798 | |
| | | | | | | | | | | | |
| | | | | | |
Undistributed net investment income | | $ | 6,686 | | | $ | 6,686 | | | $ | 61 | | | $ | 61 | | | $ | 41 | | | $ | 41 | |
| | | | | | | | | | | | |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 34 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Statements of Changes in Net Assets (continued) | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | BlackRock
New Jersey Municipal
Money Market Portfolio | | | BlackRock
North Carolina Municipal
Money Market Portfolio | | | BlackRock
Ohio Municipal
Money Market Portfolio | |
| | | | | | |
| Increase (Decrease) in Net Assets: | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended
March 31, 2012 | | | Six Months Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, 2012 | | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended
March 31, 2012 | |
|
| |
| Operations | | | | | | | | | | | | | | | | | | | | | | | | |
Net investment income | | $ | 10 | | | $ | 2,360 | | | $ | 10 | | | $ | 17 | | | $ | 11 | | | $ | 35 | |
Net realized gain | | | – | | | | 1,116 | | | | – | | | | – | | | | – | | | | – | |
| | | | | | | | | | | | |
Net increase in net assets resulting from operations | | | 10 | | | | 3,476 | | | | 10 | | | | 17 | | | | 11 | | | | 35 | |
| | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Dividends and Distributions to Shareholders From | |
Net investment income: | | | | | | | | | | | | | | | | | | | | | | | | |
Institutional | | | (7 | ) | | | (2,145 | ) | | | (10 | ) | | | (17 | ) | | | (10 | ) | | | (34 | ) |
Service | | | (3 | ) | | | (5 | ) | | | – | | | | – | | | | (1 | ) | | | – | |
Investor A | | | – | | | | (210 | ) | | | – | | | | – | | | | – | | | | (1 | ) |
Net realized gain: | | | | | | | | | | | | | | | | | | | | | | | | |
Institutional | | | – | | | | (1,701 | ) | | | – | | | | – | | | | – | | | | – | |
Service | | | – | | | | (484 | ) | | | – | | | | – | | | | – | | | | – | |
Investor A | | | – | | | | (5 | ) | | | – | | | | – | | | | – | | | | – | |
| | | | | | | | | | | | |
Decrease in net assets resulting from dividends and distributions to shareholders | | | (10 | ) | | | (4,550 | ) | | | (10 | ) | | | (17 | ) | | | (11 | ) | | | (35 | ) |
| | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Capital Share Transactions | | | | | | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in net assets derived from capital share transactions | | | (2,063,778 | ) | | | (19,024,051 | ) | | | 5,025,519 | | | | (2,547,569 | ) | | | (2,087,707 | ) | | | (34,372,420 | ) |
| | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Net Assets | | | | | | | | | | | | | | | | | | | | | | | | |
Total increase (decrease) in net assets | | | (2,063,778 | ) | | | (19,025,125 | ) | | | 5,025,519 | | | | (2,547,569 | ) | | | (2,087,707 | ) | | | (34,372,420 | ) |
Beginning of period | | | 54,982,632 | | | | 74,007,757 | | | | 44,302,558 | | | | 46,850,127 | | | | 63,662,218 | | | | 98,034,638 | |
| | | | | | | | | | | | |
End of period | | $ | 52,918,854 | | | $ | 54,982,632 | | | $ | 49,328,077 | | | $ | 44,302,558 | | | $ | 61,574,511 | | | $ | 63,662,218 | |
| | | | | | | | | | | | |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 35 |
| | |
| | |
Statements of Changes in Net Assets (concluded) | | |
| | | | | | | | | | | | | | | | |
| | | BlackRock
Pennsylvania Municipal
Money Market Portfolio | | | BlackRock
Virginia Municipal
Money Market Portfolio | |
| | | | |
| Increase (Decrease) in Net Assets: | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, 2012 | | | Six Months Ended September 30, 2012 (Unaudited) | | | Year Ended March 31, 2012 | |
|
| |
| Operations | | | | | | | | | | | | | | | | |
Net investment income | | $ | 47 | | | $ | 120 | | | $ | 81 | | | $ | 30 | |
Net realized gain | | | – | | | | 4,823 | | | | – | | | | – | |
| | | | | | | | |
Net increase in net assets resulting from operations | | | 47 | | | | 4,943 | | | | 81 | | | | 30 | |
| | | | | | | | |
| | | | | | | | | | | | | | | | |
| Dividends and Distributions to Shareholders From | | | | | | | | | | | | | | | | |
Net investment income: | | | | | | | | | | | | | | | | |
Institutional | | | (44 | ) | | | (186 | ) | | | (81 | ) | | | (30 | ) |
Service | | | (3 | ) | | | (12 | ) | | | – | | | | – | |
Investor A | | | – | | | | (1 | ) | | | – | | | | – | |
Net realized gain: | | | | | | | | | | | | | | | | |
Institutional | | | – | | | | (4,567 | ) | | | – | | | | – | |
Service | | | – | | | | (255 | ) | | | – | | | | – | |
Investor A | | | – | | | | (1 | ) | | | – | | | | – | |
| | | | | | | | |
Decrease in net assets resulting from dividends and distributions to shareholders | | | (47 | ) | | | (5,022 | ) | | | (81 | ) | | | (30 | ) |
| | | | | | | | |
| | | | | | | | | | | | | | | | |
| Capital Share Transactions | | | | | | | | | | | | | | | | |
Net increase (decrease) in net assets derived from capital share transactions | | | 6,920,632 | | | | (70,239,409 | ) | | | (4,584,182 | ) | | | (6,076,786 | ) |
| | | | | | | | |
| | | | | | | | | | | | | | | | |
| Net Assets | | | | | | | | | | | | | | | | |
Total increase (decrease) in net assets | | | 6,920,632 | | | | (70,239,488 | ) | | | (4,584,182 | ) | | | (6,076,786 | ) |
Beginning of period | | | 265,238,212 | | | | 335,477,700 | | | | 22,293,858 | | | | 28,370,644 | |
| | | | | | | | |
| | | | |
End of period | | $ | 272,158,844 | | | $ | 265,238,212 | | | $ | 17,709,676 | | | $ | 22,293,858 | |
| | | | | | | | |
| | | | |
Undistributed net investment income | | $ | 56 | | | $ | 56 | | | | – | | | | – | |
| | | | | | | | |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 36 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights | | BlackRock Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months
Ended
September 30,
2012 (Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
| | | | |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0013 | | | | 0.0090 | | | | 0.0346 | | | | 0.0498 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0013 | ) | | | (0.0090 | ) | | | (0.0346 | ) | | | (0.0498 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.01% | | | | 0.13% | | | | 0.90% | 2 | | | 3.52% | | | | 5.10% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.71% | 3 | | | 0.70% | | | | 0.71% | | | | 0.74% | | | | 0.75% | 3 | | | 0.56% | | | | 0.58% | |
|
| |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.31% | 3 | | | 0.27% | | | | 0.36% | | | | 0.41% | | | | 0.46% | 3 | | | 0.42% | | | | 0.42% | |
|
| |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.14% | | | | 1.79% | 3 | | | 3.57% | | | | 4.99% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $763,642 | | | | $790,645 | | | | $785,316 | | | | $ 433,778 | | | | $543,487 | | | | $595,728 | | | | $745,726 | |
|
| |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
| | | | | | | | |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0003 | | | | 0.0075 | | | | 0.0318 | | | | 0.0469 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0003 | ) | | | (0.0075 | ) | | | (0.0318 | ) | | | (0.0469 | ) |
|
| |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.03% | | | | 0.75% | 2 | | | 3.23% | | | | 4.80% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.95% | 3 | | | 0.94% | | | | 0.96% | | | | 0.98% | | | | 0.97% | 3 | | | 0.81% | | | | 0.84% | |
|
| |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.31% | 3 | | | 0.27% | | | | 0.37% | | | | 0.52% | | | | 0.75% | 3 | | | 0.70% | | | | 0.71% | |
|
| |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.02% | | | | 1.40% | 3 | | | 3.16% | | | | 4.69% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $312,843 | | | | $332,427 | | | | $391,617 | | | | $365,358 | | | | $514,764 | | | | $454,585 | | | | $405,701 | |
|
| |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 37 |
| | |
| | |
Financial Highlights (continued) | | BlackRock Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0003 | | | | 0.0071 | | | | 0.0312 | | | | 0.0461 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0003 | ) | | | (0.0071 | ) | | | (0.0312 | ) | | | (0.0461 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.03% | | | | 0.71% | 2 | | | 3.16% | | | | 4.71% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.91% | 3 | | | 0.89% | | | | 0.91% | | | | 0.93% | | | | 0.94% | 3 | | | 0.87% | | | | 0.92% | |
|
| |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.31% | 3 | | | 0.27% | | | | 0.37% | | | | 0.53% | | | | 0.83% | 3 | | | 0.76% | | | | 0.79% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.02% | | | | 1.41% | 3 | | | 3.07% | | | | 4.61% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $315,237 | | | | $299,205 | | | | $314,811 | | | | $358,698 | | | | $510,950 | | | | $461,079 | | | | $393,399 | |
| |
| | | Investor B | |
| | | Six Months Ended September 30, 2012 (Unaudited) | | | Year Ended March 31, | | | Period October 1, 2008 to March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0002 | | | | 0.0044 | | | | 0.0250 | | | | 0.0418 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0002 | ) | | | (0.0044 | ) | | | (0.0250 | ) | | | (0.0418 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.03% | | | | 0.44% | 2 | | | 2.53% | | | | 4.27% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.73% | 3 | | | 1.71% | | | | 1.75% | | | | 1.81% | | | | 1.80% | 3 | | | 1.77% | | | | 1.83% | |
|
| |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.31% | 3 | | | 0.27% | | | | 0.37% | | | | 0.55% | | | | 1.37% | 3 | | | 1.39% | | | | 1.22% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.02% | | | | 0.86% | 3 | | | 2.40% | | | | 4.18% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 5,233 | | | | $ 6,306 | | | | $ 7,207 | | | | $ 11,528 | | | | $ 23,467 | | | | $ 15,835 | | | | $ 11,532 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| 38 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor C | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0004 | | | | 0.0044 | | | | 0.0250 | | | | 0.0417 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0004 | ) | | | (0.0044 | ) | | | (0.0250 | ) | | | (0.0417 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.04% | | | | 0.45% | 2 | | | 2.53% | | | | 4.25% | |
|
| |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.61% | 3 | | | 1.62% | | | | 1.68% | | | | 1.75% | | | | 1.72% | 3 | | | 1.66% | | | | 1.79% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.31% | 3 | | | 0.27% | | | | 0.38% | | | | 0.55% | | | | 1.35% | 3 | | | 1.42% | | | | 1.24% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.04% | | | | 0.88% | 3 | | | 2.15% | | | | 4.16% | |
|
| |
Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 26,162 | | | | $ 29,185 | | | | $ 23,683 | | | | $ 19,016 | | | | $ 48,162 | | | | $ 25,356 | | | | $ 5,109 | |
1 Where applicable, total investment returns include the reinvestment of dividends and distributions. | |
| 2 Aggregate total investment return. | |
| 3 Annualized. | |
| | | | | | |
See Notes to Financial Statements. | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 39 |
| | |
| | |
Financial Highlights | | BlackRock U.S. Treasury Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0007 | | | | 0.0234 | | | | 0.0478 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0007 | ) | | | (0.0234 | ) | | | (0.0478 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.07% | 2 | | | 2.37% | | | | 4.89% | |
|
| |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.76% | 3 | | | 0.74% | | | | 0.74% | | | | 0.75% | | | | 0.79% | 3 | | | 0.59% | | | | 0.61% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.15% | 3 | | | 0.09% | | | | 0.20% | | | | 0.21% | | | | 0.42% | 3 | | | 0.41% | | | | 0.41% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.00% | | | | 0.15% | 3 | | | 2.26% | | | | 4.75% | |
|
| |
Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $168,018 | | | | $189,361 | | | | $133,623 | | | | $188,346 | | | | $228,457 | | | | $382,033 | | | | $312,979 | |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0004 | | | | 0.0206 | | | | 0.0450 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0004 | ) | | | (0.0206 | ) | | | (0.0450 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.04% | 2 | | | 2.08% | | | | 4.60% | |
|
| |
Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.96% | 3 | | | 0.95% | | | | 0.95% | | | | 0.95% | | | | 0.98% | 3 | | | 0.84% | | | | 0.86% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.15% | 3 | | | 0.09% | | | | 0.20% | | | | 0.22% | | | | 0.48% | 3 | | | 0.69% | | | | 0.69% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.00% | | | | 0.08% | 3 | | | 2.08% | | | | 4.50% | |
|
| |
Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $127,033 | | | | $99,022 | | | | $118,827 | | | | $149,629 | | | | $213,402 | | | | $289,805 | | | | $245,609 | |
|
| 1 Where applicable, total investment returns include the reinvestment of dividends and distributions. | |
2 Aggregate total investment return. | |
| 3 Annualized. | |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 40 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock U.S. Treasury Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
Per Share Operating Performance | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0004 | | | | 0.0206 | | | | 0.0450 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0004 | ) | | | (0.0206 | ) | | | (0.0450 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
Total Investment Return1 | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.04% | 2 | | | 2.08% | | | | 4.59% | |
|
| |
Ratios to Average Net Assets | |
Total expenses | | | 0.93% | 3 | | | 0.89% | | | | 0.86% | | | | 0.87% | | | | 0.89% | 3 | | | 0.85% | | | | 0.86% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.15% | 3 | | | 0.10% | | | | 0.20% | | | | 0.21% | | | | 0.48% | 3 | | | 0.69% | | | | 0.70% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.00% | | | | 0.08% | 3 | | | 1.86% | | | | 4.49% | |
|
| |
Supplemental Data | |
Net assets, end of period (000) | | $ | 21,318 | | | $ | 20,520 | | | $ | 104,971 | | | $ | 92,759 | | | $ | 103,762 | | | $ | 123,316 | | | $ | 31,970 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
See Notes to Financial Statements.
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 41 |
| | |
| | |
Financial Highlights | | BlackRock Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| |
| | | Institutional | |
| | | Six Months Ended September 30, 2012
(Unaudited) | | | Year Ended March 31, | | | Period October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0002 | | | | 0.0011 | | | | 0.0050 | | | | 0.0234 | | | | 0.0331 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0002 | ) | | | (0.0011 | ) | | | (0.0050 | ) | | | (0.0234 | ) | | | (0.0331 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.02% | | | | 0.11% | | | | 0.50% | 2 | | | 2.36% | | | | 3.36% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.79% | 3 | | | 0.81% | | | | 0.80% | | | | 0.79% | | | | 0.82% | 3 | | | 0.60% | | | | 0.63% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.24% | 3 | | | 0.22% | | | | 0.39% | | | | 0.43% | | | | 0.47% | 3 | | | 0.42% | | | | 0.42% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.02% | | | | 0.12% | | | | 0.95% | 3 | | | 2.26% | | | | 3.29% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 72,281 | | | | $78,590 | | | | $ 62,845 | | | | $ 67,046 | | | | $101,246 | | | | $ 92,663 | | | | $ 42,083 | |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0002 | | | | 0.0035 | | | | 0.0206 | | | | 0.0301 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0002 | ) | | | (0.0035 | ) | | | (0.0206 | ) | | | (0.0301 | ) |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.02% | | | | 0.35% | 2 | | | 2.08% | | | | 3.05% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.11% | 3 | | | 1.06% | | | | 1.06% | | | | 1.02% | | | | 1.00% | 3 | | | 0.86% | | | | 0.91% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.24% | 3 | | | 0.20% | | | | 0.42% | | | | 0.51% | | | | 0.77% | 3 | | | 0.70% | | | | 0.72% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.02% | | | | 0.78% | 3 | | | 2.06% | | | | 3.00% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 39,423 | | | | $ 56,951 | | | | $ 34,991 | | | | $ 50,013 | | | | $ 47,592 | | | | $ 81,843 | | | | $ 100,454 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 42 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0003 | | | | 0.0035 | | | | 0.0205 | | | | 0.0302 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0003 | ) | | | (0.0035 | ) | | | (0.0205 | ) | | | (0.0302 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.03% | | | | 0.35% | 2 | | | 2.07% | | | | 3.06% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.99% | 3 | | | 0.97% | | | | 0.94% | | | | 0.92% | | | | 0.94% | 3 | | | 0.86% | | | | 0.89% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.24% | 3 | | | 0.25% | | | | 0.41% | | | | 0.51% | | | | 0.77% | 3 | | | 0.71% | | | | 0.71% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.03% | | | | 0.76% | 3 | | | 2.02% | | | | 3.01% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 1,562 | | | | $ 715 | | | | $ 2,611 | | | | $ 3,443 | | | | $ 5,301 | | | | $ 7,004 | | | | $ 3,776 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 43 |
| | |
| | |
Financial Highlights | | BlackRock New Jersey Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months Ended September 30, 2012
(Unaudited) | | | Year Ended March 31, | | | Period October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0003 | | | | 0.0022 | | | | 0.0058 | | | | 0.0228 | | | | 0.0326 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0003 | ) | | | (0.0022 | ) | | | (0.0058 | ) | | | (0.0228 | ) | | | (0.0326 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.03% | | | | 0.22% | | | | 0.59% | 2 | | | 2.30% | | | | 3.31% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.86% | 3 | | | 0.85% | | | | 0.80% | | | | 0.79% | | | | 0.82% | 3 | | | 0.61% | | | | 0.62% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.27% | 3 | | | 0.27% | | | | 0.39% | | | | 0.41% | | | | 0.43% | 3 | | | 0.39% | | | | 0.39% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.02% | | | | 0.24% | | | | 1.15% | 3 | | | 2.30% | | | | 3.26% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 37,014 | | | $ | 41,966 | | | $ | 46,755 | | | $ | 59,520 | | | $ | 103,465 | | | $ | 114,696 | | | $ | 156,005 | |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0005 | | | | 0.0044 | | | | 0.0200 | | | | 0.0298 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0005 | ) | | | (0.0044 | ) | | | (0.0200 | ) | | | (0.0298 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.05% | | | | 0.44% | 2 | | | 2.02% | | | | 3.03% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.04% | 3 | | | 1.05% | | | | 1.02% | | | | 1.04% | | | | 1.06% | 3 | | | 0.86% | | | | 0.88% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.26% | 3 | | | 0.28% | | | | 0.42% | | | | 0.59% | | | | 0.73% | 3 | | | 0.67% | | | | 0.67% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.05% | | | | 0.89% | 3 | | | 2.07% | | | | 2.98% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 15,847 | | | $ | 12,895 | | | $ | 15,935 | | | $ | 19,373 | | | $ | 23,791 | | | $ | 25,401 | | | $ | 43,013 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 44 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock New Jersey Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0006 | | | | 0.0045 | | | | 0.0200 | | | | 0.0298 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0006 | ) | | | (0.0045 | ) | | | (0.0200 | ) | | | (0.0298 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.01% | | | | 0.06% | | | | 0.45% | 2 | | | 2.02% | | | | 3.03% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.32% | 3 | | | 0.94% | | | | 0.90% | | | | 0.92% | | | | 0.93% | 3 | | | 0.86% | | | | 0.87% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.27% | 3 | | | 0.38% | | | | 0.41% | | | | 0.59% | | | | 0.69% | 3 | | | 0.67% | | | | 0.67% | |
Net investment income | | | 0.01% | 3 | | | 0.01% | | | | 0.01% | | | | 0.06% | | | | 0.92% | 3 | | | 1.96% | | | | 2.99% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 58 | | | $ | 122 | | | $ | 11,318 | | | $ | 15,025 | | | $ | 23,381 | | | $ | 27,216 | | | $ | 30,250 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 45 |
| | |
| | |
Financial Highlights | | BlackRock North Carolina Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0009 | | | | 0.0052 | | | | 0.0234 | | | | 0.0336 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0009 | ) | | | (0.0052 | ) | | | (0.0234 | ) | | | (0.0336 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.01% | | | | 0.09% | | | | 0.52% | 2 | | | 2.37% | | | | 3.42% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.71% | 3 | | | 0.76% | | | | 0.69% | | | | 0.73% | | | | 0.77% | 3 | | | 0.67% | | | | 0.68% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.20% | 3 | | | 0.15% | | | | 0.29% | | | | 0.30% | | | | 0.34% | 3 | | | 0.30% | | | | 0.30% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.01% | | | | 0.10% | | | | 0.98% | 3 | | | 2.31% | | | | 3.36% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 49,259 | | | $ | 44,159 | | | $ | 46,622 | | | $ | 74,251 | | | $ | 79,880 | | | $ | 60,404 | | | $ | 66,246 | |
|
| |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0003 | | | | 0.0037 | | | | 0.0207 | | | | 0.0307 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0003 | ) | | | (0.0037 | ) | | | (0.0207 | ) | | | (0.0307 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.03% | | | | 0.37% | 2 | | | 2.08% | | | | 3.12% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.17% | 3 | | | 1.15% | | | | 1.21% | | | | 0.98% | | | | 1.01% | 3 | | | 0.92% | | | | 0.94% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.26% | 3 | | | 0.19% | | | | 0.30% | | | | 0.41% | | | | 0.63% | 3 | | | 0.58% | | | | 0.58% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.06% | | | | 0.75% | 3 | | | 2.09% | | | | 3.10% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 27 | | | $ | 65 | | | $ | 138 | | | $ | 165 | | | $ | 3,172 | | | $ | 3,156 | | | $ | 1,295 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 46 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock North Carolina Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0032 | | | | 0.0190 | | | | 0.0298 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0032 | ) | | | (0.0190 | ) | | | (0.0298 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.32% | 2 | | | 1.92% | | | | 3.03% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.30% | 3 | | | 1.23% | | | | 1.10% | | | | 1.12% | | | | 1.18% | 3 | | | 1.08% | | | | 1.02% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.21% | 3 | | | 0.15% | | | | 0.30% | | | | 0.39% | | | | 0.73% | 3 | | | 0.74% | | | | 0.67% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.61% | 3 | | | 1.98% | | | | 2.98% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 41 | | | $ | 78 | | | $ | 90 | | | $ | 106 | | | $ | 168 | | | $ | 155 | | | $ | 189 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 47 |
| | |
| | |
Financial Highlights | | BlackRock Ohio Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months Ended September 30, 2012
(Unaudited) | | | Year Ended March 31, | | | Period October 1, 2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0003 | | | | 0.0029 | | | | 0.0071 | | | | 0.0245 | | | | 0.0336 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0003 | ) | | | (0.0029 | ) | | | (0.0071 | ) | | | (0.0245 | ) | | | (0.0336 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.03% | | | | 0.29% | | | | 0.72% | 2 | | | 2.48% | | | | 3.41% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.81% | 3 | | | 0.74% | | | | 0.74% | | | | 0.75% | | | | 0.73% | 3 | | | 0.62% | | | | 0.62% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.24% | 3 | | | 0.18% | | | | 0.37% | | | | 0.41% | | | | 0.42% | 3 | | | 0.39% | | | | 0.39% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.03% | | | | 0.29% | | | | 1.37% | 3 | | | 2.41% | | | | 3.35% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 53,233 | | | $ | 59,034 | | | $ | 88,491 | | | $ | 149,659 | | | $ | 179,038 | | | $ | 137,274 | | | $ | 101,325 | |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0009 | | | | 0.0058 | | | | 0.0217 | | | | 0.0308 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0009 | ) | | | (0.0058 | ) | | | (0.0217 | ) | | | (0.0308 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.09% | | | | 0.57% | 2 | | | 2.20% | | | | 3.13% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.00% | 3 | | | 1.04% | | | | 0.97% | | | | 1.02% | | | | 0.99% | 3 | | | 0.87% | | | | 0.87% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.23% | 3 | | | 0.19% | | | | 0.40% | | | | 0.62% | | | | 0.71% | 3 | | | 0.67% | | | | 0.67% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.10% | | | | 1.33% | 3 | | | 2.11% | | | | 3.09% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 8,337 | | | $ | 4,623 | | | $ | 4,156 | | | $ | 4,591 | | | $ | 14,636 | | | $ | 26,403 | | | $ | 8,199 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 48 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock Ohio Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0011 | | | | 0.0057 | | | | 0.0217 | | | | 0.0308 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0011 | ) | | | (0.0057 | ) | | | (0.0217 | ) | | | (0.0308 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.01% | | | | 0.11% | | | | 0.58% | 2 | | | 2.20% | | | | 3.13% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 5.77% | 3 | | | 0.91% | | | | 0.88% | | | | 0.88% | | | | 0.90% | 3 | | | 0.87% | | | | 0.87% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.24% | 3 | | | 0.26% | | | | 0.40% | | | | 0.60% | | | | 0.70% | 3 | | | 0.67% | | | | 0.67% | |
Net investment income | | | 0.02% | 3 | | | 0.00% | | | | 0.02% | | | | 0.12% | | | | 1.29% | 3 | | | 2.13% | | | | 3.08% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 4 | | | $ | 5 | | | $ | 5,388 | | | $ | 13,318 | | | $ | 24,902 | | | $ | 41,209 | | | $ | 22,201 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 49 |
| | |
| | |
Financial Highlights | | BlackRock Pennsylvania Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0005 | | | | 0.0047 | | | | 0.0222 | | | | 0.0329 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0005 | ) | | | (0.0047 | ) | | | (0.0222 | ) | | | (0.0329 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.06% | | | | 0.48% | 2 | | | 2.24% | | | | 3.34% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.75% | 3 | | | 0.74% | | | | 0.73% | | | | 0.75% | | | | 0.75% | 3 | | | 0.58% | | | | 0.59% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.22% | 3 | | | 0.19% | | | | 0.31% | | | | 0.39% | | | | 0.46% | 3 | | | 0.42% | | | | 0.42% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.07% | | | | 0.93% | 3 | | | 2.21% | | | | 3.29% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 255,056 | | | $ | 248,836 | | | $ | 287,394 | | | $ | 332,387 | | | $ | 589,724 | | | $ | 535,882 | | | $ | 500,402 | |
| |
| | | Service | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | (0.0000 | ) | | | 0.0033 | | | | 0.0194 | | | | 0.0301 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0033 | ) | | | (0.0194 | ) | | | (0.0301 | ) |
Net asset value, end of period | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | | | $ | 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.00% | | | | 0.33% | 2 | | | 1.96% | | | | 3.06% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.00% | 3 | | | 0.96% | | | | 0.90% | | | | 0.91% | | | | 0.92% | 3 | | | 0.83% | | | | 0.84% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.23% | 3 | | | 0.21% | | | | 0.31% | | | | 0.46% | | | | 0.74% | 3 | | | 0.70% | | | | 0.70% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.00% | | | | 0.69% | 3 | | | 1.94% | | | | 3.01% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | $ | 17,041 | | | $ | 16,333 | | | $ | 30,649 | | | $ | 27,166 | | | $ | 52,127 | | | $ | 52,654 | | | $ | 55,934 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 50 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Financial Highlights (concluded) | | BlackRock Pennsylvania Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Investor A | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1, 2008 to
March 31, 2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0000 | | | | 0.0001 | | | | 0.0035 | | | | 0.0194 | | | | 0.0300 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0001 | ) | | | (0.0035 | ) | | | (0.0194 | ) | | | (0.0300 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.35% | 2 | | | 1.96% | | | | 3.05% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 1.46% | 3 | | | 0.85% | | | | 0.84% | | | | 0.85% | | | | 0.86% | 3 | | | 0.83% | | | | 0.85% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.23% | 3 | | | 0.27% | | | | 0.31% | | | | 0.44% | | | | 0.71% | 3 | | | 0.70% | | | | 0.71% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.00% | | | | 0.01% | | | | 0.72% | 3 | | | 1.68% | | | | 3.00% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 62 | | | | $ 69 | | | | $ 17,434 | | | | $ 22,109 | | | | $ 34,483 | | | | $ 36,708 | | | | $ 33,490 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 51 |
| | |
| | |
Financial Highlights | | BlackRock Virginia Municipal Money Market Portfolio |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | |
| | | Six Months
Ended
September 30,
2012
(Unaudited) | | | Year Ended March 31, | | | Period
October 1,
2008 to
March 31,
2009 | | | Year Ended September 30, | |
| | | | 2012 | | | 2011 | | | 2010 | | | | 2008 | | | 2007 | |
|
| |
| Per Share Operating Performance | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net asset value, beginning of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
Net investment income | | | 0.0000 | | | | 0.0000 | | | | 0.0002 | | | | 0.0011 | | | | 0.0041 | | | | 0.0228 | | | | 0.0336 | |
Dividends from net investment income | | | (0.0000 | ) | | | (0.0000 | ) | | | (0.0002 | ) | | | (0.0011 | ) | | | (0.0041 | ) | | | (0.0228 | ) | | | (0.0336 | ) |
Net asset value, end of period | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | | | | $ 1.00 | |
|
| |
| Total Investment Return1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on net asset value | | | 0.00% | 2 | | | 0.00% | | | | 0.02% | | | | 0.12% | | | | 0.42% | 2 | | | 2.31% | | | | 3.42% | |
|
| |
| Ratios to Average Net Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 0.94% | 3 | | | 0.85% | | | | 0.81% | | | | 0.80% | | | | 0.79% | 3 | | | 0.65% | | | | 0.67% | |
Total expenses after fees waived, reimbursed and paid indirectly | | | 0.22% | 3 | | | 0.18% | | | | 0.29% | | | | 0.32% | | | | 0.35% | 3 | | | 0.30% | | | | 0.30% | |
Net investment income | | | 0.00% | 3 | | | 0.00% | | | | 0.02% | | | | 0.13% | | | | 0.92% | 3 | | | 2.30% | | | | 3.37% | |
|
| |
| Supplemental Data | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net assets, end of period (000) | | | $ 17,710 | | | | $ 22,294 | | | | $ 28,370 | | | | $ 42,326 | | | | $ 75,817 | | | | $ 90,845 | | | | $ 81,190 | |
| | 1 | Where applicable, total investment returns include the reinvestment of dividends and distributions. |
| | 2 | Aggregate total investment return. |
| | | | | | |
| See Notes to Financial Statements. |
| | | | | | | |
| 52 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Notes to Financial Statements (Unaudited) | | |
1. Organization and Significant Accounting Policies:
BlackRock FundsSM (the “Trust”), is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust is organized as a Massachusetts business trust. BlackRock Money Market Portfolio (“Money Market”), BlackRock U.S. Treasury Money Market Portfolio (“U.S. Treasury”), BlackRock Municipal Money Market Portfolio (“Municipal”), BlackRock New Jersey Municipal Money Market Portfolio (“New Jersey Municipal”), BlackRock North Carolina Municipal Money Market Portfolio (“North Carolina Municipal”), BlackRock Ohio Municipal Money Market Portfolio (“Ohio Municipal”), BlackRock Pennsylvania Municipal Money Market Portfolio (“Pennsylvania Municipal”) and BlackRock Virginia Municipal Money Market Portfolio (“Virginia Municipal”) (collectively, the “Funds” or individually, a “Fund”) are each a series of the Trust. Each of the Funds, except Money Market, U.S. Treasury and Municipal, is non-diversified. The Funds’ financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”), which may require the use of management accruals and estimates. Actual results may differ from these estimates. Each Fund may offer Shares of Institutional, Service, Investor A, Investor B and Investor C classes. All classes of shares have identical voting, dividend, liquidation and other rights and the same terms and conditions, except that Service, Hilliard Lyons, Investor A, Investor B and Investor C Shares bear certain expenses related to the shareholder servicing of such shares and Investor B and Investor C Shares also bear certain expenses related to the distribution of such shares. Investor B Shares automatically convert to Investor A Shares after approximately eight years. Investor B Shares are only available for purchase through exchanges, dividend reinvestment by existing shareholders or for purchase by certain qualified employee benefit plans. Each class has exclusive voting rights with respect to matters relating to its shareholder servicing and distribution expenditures (except that Investor B shareholders may vote on material changes to the Investor A distribution and service plan).
The following is a summary of significant accounting policies followed by the Funds:
Valuation: US GAAP defines fair value as the price the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Funds’ investments are valued under the amortized cost method which approximates current market value in accordance with Rule 2a-7 under the 1940 Act. Under this method, investments are valued at cost when purchased and thereafter, a constant proportionate accretion and amortization of any discounts and premiums are recorded until the maturity of the security. Each Fund seeks to maintain its net asset value per share at $1.00, although there is no assurance that it will be able to do so on a continuing basis.
Repurchase Agreements: The Funds may invest in repurchase agreements. In a repurchase agreement, the Funds purchase a security from a counterparty who agrees to repurchase the same security at a mutually agreed upon date and price. On a daily basis, the counterparty is required to maintain collateral subject to the agreement and in value no
less than the agreed repurchase amount. The agreements are conditioned upon the collateral being deposited under the Federal Reserve book entry system or held in a segregated account by the Funds’ custodian or designated sub-custodians under tri-party repurchase agreements. In the event the counterparty defaults and the fair value of the collateral declines, the Funds could experience losses, delays and costs in liquidating the collateral.
Investment Transactions and Investment Income: For financial reporting purposes, investment transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on investment transactions are determined on the identified cost basis. Interest income, including amortization and accretion of premium and discount on debt securities, is recognized on the accrual basis. Income and realized gains and losses are allocated daily to each class based on its relative net assets.
Dividends and Distributions: Dividends from net investment income are declared daily and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates. The character and timing of dividends and distributions are determined in accordance with federal income tax regulations, which may differ from US GAAP.
Income Taxes: It is the Funds’ policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies and to distribute substantially all of their taxable income to their shareholders. Therefore, no federal income tax provision is required.
The Funds file US federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on each Fund’s US federal tax returns remains open for the period ended March 31, 2009 and the three years ended March 31, 2012. The statutes of limitations on each Fund’s state and local tax returns may remain open for an additional year depending upon the jurisdiction. Management does not believe there are any uncertain tax positions that require recognition of a tax liability.
Recent Accounting Standard: In December 2011, the Financial Accounting Standards Board issued guidance that will expand current disclosure requirements on the offsetting of certain assets and liabilities. The new disclosures will be required for investments and derivative financial instruments subject to master netting or similar agreements which are eligible for offset in the Statements of Assets and Liabilities and will require an entity to disclose both gross and net information about such investments and transactions in the financial statements. The guidance is effective for financial statements with fiscal years beginning on or after January 1, 2013, and interim periods within those fiscal years. Management is evaluating the impact of this guidance on the Funds’ financial statement disclosures.
Other: Expenses directly related to a Fund or its classes are charged to that Fund or class. Other operating expenses shared by several funds are pro rated among those funds on the basis of relative net assets or other
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 53 |
| | |
| | |
Notes to Financial Statements (continued) | | |
appropriate methods. Expenses directly related to the Funds and other shared expenses pro rated to the Funds are allocated daily to each class based on its relative net assets or other appropriate methods.
The Funds have an arrangement with the custodian whereby fees may be reduced by credits earned on uninvested cash balances, which, if applicable, are shown as fees paid indirectly in the Statements of Operations. The custodian imposes fees on overdrawn cash balances, which can be offset by accumulated credits earned or may result in additional custody charges.
2. Investment Advisory Agreement and Other Transactions with Affiliates:
The PNC Financial Services Group, Inc. (“PNC”) is the largest stockholder and an affiliate, for 1940 Act purposes, of BlackRock, Inc. (“BlackRock”).
The Trust, on behalf of the Funds, entered into an Investment Advisory Agreement with BlackRock Advisors, LLC (the “Manager”), the Funds’ investment advisor, an indirect, wholly owned subsidiary of BlackRock, to provide investment advisory and administration services. The Manager is responsible for the management of each Fund’s portfolio and provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of each Fund. For such services, each Fund pays the Manager a monthly fee based on a percentage of each Fund’s average daily net assets as follows:
| | |
| Average Daily Net Assets | | Investment Advisory Fee |
First $1 billion | | 0.450% |
$1 billion - $2 billion | | 0.400% |
$2 billion - $3 billion | | 0.375% |
Greater than $3 billion | | 0.350% |
The Trust, on behalf of each Fund, entered into a Distribution Agreement and Distribution and Service Plan with BlackRock Investments, LLC (“BRIL”), an affiliate of the Manager. Pursuant to the Distribution and Service Plan and in accordance with Rule 12b-1 under the 1940 Act, the Fund pays BRIL ongoing service and distribution fees. The fees are accrued daily and paid monthly at annual rates based upon the average daily net assets of the shares of each Fund as follows:
| | | | |
| | | Service
Fee | | Distribution
Fee |
Service | | 0.25% | | – |
Investor A | | 0.25% | | – |
Investor B | | 0.25% | | 0.75% |
Investor C | | 0.25% | | 0.75% |
Pursuant to sub-agreements with BRIL, broker-dealers and BRIL provide shareholder servicing and distribution services to the Fund. The ongoing service and/or distribution fee compensates BRIL and each broker-dealer for providing shareholder servicing and/or distribution related services to Service, Investor A, Investor B and Investor C shareholders.
Pursuant to written agreements, certain financial intermediaries, some of which may be affiliates, provide the Funds with sub-accounting, recordkeeping, sub-transfer agency and other administrative services with respect to sub-accounts they service. For these services, these entities receive an annual fee per shareholder account, which will vary depending on share class and/or net assets. For the six months ended September 30, 2012, the Funds paid the following to affiliates in return for these services, which are included in transfer agent - class specific in the Statements of Operations:
| | | | |
Money Market | | $ | 801,279 | |
U.S. Treasury | | $ | 203,563 | |
Municipal | | $ | 83,504 | |
New Jersey Municipal | | $ | 34,061 | |
North Carolina Municipal | | $ | 3,410 | |
Ohio Municipal | | $ | 38,930 | |
Pennsylvania Municipal | | $ | 187,636 | |
Virginia Municipal | | $ | 4,497 | |
The Manager maintains a call center, which is responsible for providing certain shareholder services to the Funds, such as responding to shareholder inquiries and processing transactions based upon instructions from shareholders with respect to the subscription and redemption of Fund shares. For the six months ended September 30, 2012, each Fund reimbursed the Manager the following amounts for costs incurred in running the call center, which are included in transfer agent – class specific in the Statements of Operations.
| | | | | | | | | | | | | | | | | | | | | | | | |
| Call Center | |
| | | | | | |
| | | Insti-
tutional | | | Service | | | Investor
A | | | Investor
B | | | Investor
C | | | Total | |
Money Market | | $ | 1,691 | | | $ | 923 | | | $ | 10,939 | | | $ | 508 | | | $ | 714 | | | $ | 14,775 | |
U.S. Treasury | | $ | 325 | | | $ | 315 | | | $ | 253 | | | | – | | | | – | | | $ | 893 | |
Municipal | | $ | 102 | | | $ | 285 | | | $ | 38 | | | | – | | | | – | | | $ | 425 | |
New Jersey
Municipal | | $ | 72 | | | $ | 58 | | | $ | 10 | | | | – | | | | – | | | $ | 140 | |
North Carolina
Municipal | | $ | 84 | | | | – | | | $ | 11 | | | | – | | | | – | | | $ | 95 | |
Ohio Municipal | | $ | 126 | | | $ | 8 | | | $ | 6 | | | | – | | | | – | | | $ | 140 | |
Pennsylvania
Municipal | | $ | 465 | | | $ | 39 | | | $ | 12 | | | | – | | | | – | | | $ | 516 | |
Virginia
Municipal | | $ | 51 | | | | – | | | | – | | | | – | | | | – | | | $ | 51 | |
| | | | | | |
| | | | | | | |
| 54 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Notes to Financial Statements (continued) | | |
For the six months ended September 30, 2012, the following table shows the class specific transfer agent fees borne directly by each class of each Fund:
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | Institutional | | | Service | | | Investor A | | | Investor B | | | Investor C | | | Total | |
Money Market | | $ | 581,283 | | | $ | 230,515 | | | $ | 171,288 | | | $ | 4,885 | | | $ | 7,433 | | | $ | 995,404 | |
U.S. Treasury | | $ | 141,557 | | | $ | 56,044 | | | $ | 7,842 | | | | – | | | | – | | | $ | 205,443 | |
Municipal | | $ | 48,117 | | | $ | 46,044 | | | $ | 396 | | | | – | | | | – | | | $ | 94,557 | |
New Jersey Municipal | | $ | 31,822 | | | $ | 6,527 | | | $ | 160 | | | | – | | | | – | | | $ | 38,509 | |
North Carolina Municipal | | $ | 4,595 | | | $ | 85 | | | $ | 106 | | | | – | | | | – | | | $ | 4,786 | |
Ohio Municipal | | $ | 40,602 | | | $ | 2,082 | | | $ | 112 | | | | – | | | | – | | | $ | 42,796 | |
Pennsylvania Municipal | | $ | 195,231 | | | $ | 12,196 | | | $ | 197 | | | | – | | | | – | | | $ | 207,624 | |
Virginia Municipal. | | $ | 5,999 | | | | – | | | | – | | | | – | | | | – | | | $ | 5,999 | |
BNY Mellon Investment Servicing (US) Inc. (“BNYMIS”) and the Manager act as co-administrators for the Fund. For these services, the co-administrators receive a combined administration fee computed daily and payable monthly, based on a percentage of the average daily net assets of each Fund. The combined administration fee is paid at the following annual rates:
| | |
| Average Daily Net Assets | | Administration Fee |
First $500 million | | 0.075% |
$500 million - $1 billion | | 0.065% |
Greater than $1 billion | | 0.055% |
In addition, each of the share classes is charged an administration fee based on the following percentages of average daily net assets of each respective class:
| | |
| Average Daily Net Assets | | Administration Fee – Class Specific |
First $500 million | | 0.025% |
$500 million - $1 billion | | 0.015% |
Greater than $1 billion | | 0.005% |
In addition, BNYMIS and the Manager may have, at their discretion, voluntarily waived all or any portion of their administration fees for a Fund or a share class which are included in administration fees waived and administration fees waived – class specific in the Statement of Operations.
For the six months ended September 30, 2012, the Funds paid the following to the Manager in return for these services, which are included in administration, administration – class specific, administration fees waived and administration fees waived – class specific in the Statements of Operations:
| | | | |
Money Market | | $ | 414,660 | |
U.S. Treasury | | $ | 99,127 | |
Municipal | | $ | 35,415 | |
New Jersey Municipal | | $ | 12,268 | |
North Carolina Municipal | | $ | 6,554 | |
Ohio Municipal | | $ | 15,073 | |
Pennsylvania Municipal | | $ | 83,684 | |
For the six months ended, September 30, 2012, the following table shows the class specific administration fees borne directly by each class of each Fund:
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Institutional | | | | Service | | | | Investor A | | | | Investor B | | | | Investor C | | | | Total | |
Money Market | | $ | 80,039 | | | $ | 39,589 | | | $ | 40,308 | | | $ | 715 | | | $ | 3,536 | | | $ | 164,187 | |
U.S. Treasury | | $ | 23,116 | | | $ | 13,525 | | | $ | 2,603 | | | | – | | | | – | | | $ | 39,244 | |
Municipal | | $ | 9,182 | | | $ | 5,660 | | | $ | 128 | | | | – | | | | – | | | $ | 14,970 | |
New Jersey Municipal | | $ | 4,899 | | | $ | 1,865 | | | $ | 12 | | | | – | | | | – | | | $ | 6,776 | |
North Carolina Municipal | | $ | 6,568 | | | $ | 9 | | | $ | 7 | | | | – | | | | – | | | $ | 6,584 | |
Ohio Municipal | | $ | 7,117 | | | $ | 628 | | | | – | | | | – | | | | – | | | $ | 7,745 | |
Pennsylvania Municipal | | $ | 30,186 | | | $ | 2,012 | | | $ | 8 | | | | – | | | | – | | | $ | 32,206 | |
Virginia Municipal | | $ | 2,428 | | | | – | | | | – | | | | – | | | | – | | | $ | 2,428 | |
The Manager contractually or voluntarily agreed to waive and/or reimburse fees or expenses, excluding interest expense, dividend expense, acquired fund fees and expenses and certain other fund expenses, which constitute extraordinary expenses not incurred in the ordinary course of the Funds’ business, in order to limit expenses. The expense limitations as a percentage of average daily net assets are as follows:
| | | | | | | | | | | | |
| | | Money Market | | U.S. Treasury | | Municipal | | New Jersey Municipal |
| | | Contractual1 | | Voluntary2 | | Contractual1 | | Contractual1 | | Voluntary2 | | Contractual1 |
Institutional | | 0.42% | | - | | 0.41% | | 0.42% | | - | | 0.39% |
Service | | 0.72% | | - | | 0.71% | | 0.72% | | - | | 0.69% |
Hilliard Lyons | | 0.91%3 | | 0.76%3 | | N/A | | 0.66%3 | | 0.49%3 | | N/A |
Investor A | | 0.89% | | - | | 0.88% | | 0.89% | | - | | 0.96% |
Investor B | | 1.49% | | - | | N/A | | N/A | | N/A | | N/A |
Investor C | | 1.49% | | - | | N/A | | N/A | | N/A | | N/A |
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 55 |
| | |
| | |
Notes to Financial Statements (continued) | | |
| | | | | | | | |
| | | North Carolina Municipal | | Ohio Municipal | | Pennsylvania Municipal | | Virginia Municipal |
| | | Contractual1 | | Contractual1 | | Contractual1 | | Contractual1 |
Institutional | | 0.30% | | 0.39% | | 0.42% | | 0.30% |
Service | | 0.60% | | 0.69% | | 0.72% | | 0.60%3 |
Hilliard Lyons | | N/A | | N/A | | N/A | | N/A |
Investor A | | 0.87% | | 0.96% | | 0.99% | | 0.87%3 |
Investor B | | N/A | | N/A | | N/A | | N/A |
Investor C | | N/A | | N/A | | N/A | | N/A |
| | 1 | The Manager has agreed not to reduce or discontinue this contractual waiver or reimbursement until August 1, 2013 unless approved by the Board, including a majority of the Independent Trustees. |
| | 2 | The voluntary waiver or reimbursement may be reduced or discontinued at any time without notice. |
| | 3 | Fund currently active but no assets in share class. |
These amounts are included in fees waived by Manager, and shown as administration fees waived – class specific, service and distribution fees waived – class specific, transfer agent fees waived – class specific, transfer agent fees reimbursed – class specific and expenses reimbursed by Manager, respectively, in the Statements of Operations. Class specific expense waivers or reimbursements are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | |
| Administration Fees Waived | | | | |
| | | Institutional | | | Service | | | Investor A | | | Investor B | | | Investor C | | | Total | |
Money Market | | $ | 80,039 | | | $ | 39,589 | | | $ | 40,308 | | | $ | 715 | | | $ | 3,536 | | | $ | 164,187 | |
U.S. Treasury | | $ | 23,116 | | | $ | 13,525 | | | $ | 2,603 | | | | – | | | | – | | | $ | 39,244 | |
Municipal | | $ | 9,182 | | | $ | 5,660 | | | $ | 128 | | | | – | | | | – | | | $ | 14,970 | |
New Jersey Municipal | | $ | 4,899 | | | $ | 1,865 | | | $ | 12 | | | | – | | | | – | | | $ | 6,776 | |
North Carolina Municipal | | $ | 6,568 | | | $ | 9 | | | $ | 7 | | | | – | | | | – | | | $ | 6,584 | |
Ohio Municipal | | $ | 7,117 | | | $ | 628 | | | | – | | | | – | | | | – | | | $ | 7,745 | |
Pennsylvania Municipal | | $ | 30,186 | | | $ | 2,012 | | | $ | 8 | | | | – | | | | – | | | $ | 32,206 | |
Virginia Municipal | | $ | 2,428 | | | | – | | | | – | | | | – | | | | – | | | $ | 2,428 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Service and Distribution Fees Waived | | | | |
| | | Service | | | Investor A | | | Investor B | | | Investor C | | | Total | |
Money Market | | $ | 395,892 | | | $ | 402,996 | | | $ | 28,546 | | | $ | 141,028 | | | $ | 968,462 | |
U.S. Treasury | | $ | 135,253 | | | $ | 26,025 | | | | – | | | | – | | | $ | 161,278 | |
Municipal | | $ | 56,605 | | | $ | 1,280 | | | | – | | | | – | | | $ | 57,885 | |
New Jersey Municipal | | $ | 18,653 | | | $ | 109 | | | | – | | | | – | | | $ | 18,762 | |
North Carolina Municipal | | $ | 93 | | | $ | 74 | | | | – | | | | – | | | $ | 167 | |
Ohio Municipal | | $ | 6,277 | | | $ | 6 | | | | – | | | | – | | | $ | 6,283 | |
Pennsylvania Municipal | | $ | 20,124 | | | $ | 79 | | | | – | | | | – | | | $ | 20,203 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Transfer Agent Fees Waived | | | | |
| | | Institutional | | | Service | | | Investor A | | | Investor B | | | Investor C | | | Total | |
Money Market | | $ | 1,691 | | | $ | 923 | | | $ | 10,939 | | | $ | 508 | | | $ | 714 | | | $ | 14,775 | |
U.S. Treasury | | $ | 325 | | | $ | 315 | | | $ | 253 | | | | – | | | | – | | | $ | 893 | |
Municipal | | $ | 102 | | | $ | 285 | | | $ | 38 | | | | – | | | | – | | | $ | 425 | |
New Jersey Municipal | | $ | 72 | | | | – | | | $ | 12 | | | | – | | | | – | | | $ | 84 | |
North Carolina Municipal | | $ | 84 | | | | – | | | $ | 11 | | | | – | | | | – | | | $ | 95 | |
Ohio Municipal | | $ | 126 | | | | – | | | $ | 6 | | | | – | | | | – | | | $ | 132 | |
Pennsylvania Municipal | | $ | 465 | | | $ | 40 | | | $ | 11 | | | | – | | | | – | | | $ | 516 | |
Virginia Municipal | | $ | 51 | | | | – | | | | – | | | | – | | | | – | | | $ | 51 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Transfer Agent Fees Reimbursed | | | | |
| | | Institutional | | | Service | | | Investor A | | | Investor B | | | Investor C | | | Total | |
Money Market | | $ | 579,591 | | | $ | 229,592 | | | $ | 160,350 | | | $ | 4,377 | | | $ | 6,719 | | | $ | 980,629 | |
U.S. Treasury | | $ | 141,231 | | | $ | 55,730 | | | $ | 7,589 | | | | – | | | | – | | | $ | 204,550 | |
Municipal | | $ | 48,016 | | | $ | 45,759 | | | $ | 357 | | | | – | | | | – | | | $ | 94,132 | |
New Jersey Municipal | | $ | 31,751 | | | $ | 6,468 | | | $ | 150 | | | | – | | | | – | | | $ | 38,369 | |
North Carolina Municipal | | $ | 4,511 | | | $ | 67 | | | $ | 95 | | | | – | | | | – | | | $ | 4,673 | |
Ohio Municipal | | $ | 40,475 | | | $ | 2,075 | | | $ | 106 | | | | – | | | | – | | | $ | 42,656 | |
Pennsylvania Municipal | | $ | 194,766 | | | $ | 12,157 | | | $ | 185 | | | | – | | | | – | | | $ | 207,108 | |
Virginia Municipal | | $ | 5,948 | | | | – | | | | – | | | | – | | | | – | | | $ | 5,948 | |
| | | | | | |
| | | | | | | |
| 56 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Notes to Financial Statements (continued) | | |
If during a Fund’s fiscal year the operating expenses of a share class, that at any time during the prior two fiscal years received a waiver or reimbursement from the Manager, are less than the expense limit for that share class, the Manager is entitled to be reimbursed by such share class up to the lesser of (a) the amount of fees waived or expenses reimbursed during those prior two fiscal years under the agreement and (b) the amount by which the expense limit for that share class exceeds the operating expenses of the share class for the current fiscal year, provided that: (1) the Fund of which the share class is a part has more than $50 million in assets for the fiscal year and (2) the Manager or an affiliate continues to serve as the Fund’s investment advisor or administrator. In the event the expense limit for a share class is changed subsequent to a fiscal year in which the Manager becomes entitled to reimbursement for fees waived or reimbursed, the amount available to reimburse the Manager shall be calculated by reference to the expense limit for that share class in effect at the time the Manager became
entitled to receive such reimbursement, rather than the subsequently changed expense limit for that share class.
For the six months ended September 30, 2012, the amounts subject to possible future recoupment under the expense limitation agreement are as follows:
| | | | | | | | | | | | |
| | | Expiring March 31, | |
| | | 2013 | | | 2014 | | | 2015 | |
Money Market | | $ | 2,583,912 | | | $ | 2,959,175 | | | $ | 1,428,590 | |
U.S. Treasury | | $ | 1,006,346 | | | $ | 891,177 | | | $ | 435,296 | |
Municipal | | $ | 406,249 | | | $ | 360,593 | | | $ | 185,340 | |
New Jersey Municipal | | $ | 292,049 | | | $ | 254,493 | | | $ | 114,274 | |
North Carolina Municipal | | $ | 238,972 | | | $ | 216,724 | | | $ | 108,247 | |
Ohio Municipal | | $ | 388,973 | | | $ | 337,139 | | | $ | 126,353 | |
Pennsylvania Municipal | | $ | 982,155 | | | $ | 1,023,853 | | | $ | 416,506 | |
Virginia Municipal | | $ | 168,692 | | | $ | 167,604 | | | $ | 61,844 | |
For the six months ended September 30, 2012, the following table shows the class specific service and distribution fees borne directly by each class of each Fund:
| | | | | | | | | | | | | | | | | | | | |
| | | Service | | | Investor A | | | Investor B | | | Investor C | | | Total | |
Money Market | | $ | 395,892 | | | $ | 402,996 | | | $ | 28,546 | | | $ | 141,028 | | | $ | 968,462 | |
U.S. Treasury | | $ | 135,253 | | | $ | 26,025 | | | | – | | | | – | | | $ | 161,278 | |
Municipal | | $ | 56,605 | | | $ | 1,280 | | | | – | | | | – | | | $ | 57,885 | |
New Jersey Municipal | | $ | 18,653 | | | $ | 109 | | | | – | | | | – | | | $ | 18,762 | |
North Carolina Municipal | | $ | 93 | | | $ | 74 | | | | – | | | | – | | | $ | 167 | |
Ohio Municipal | | $ | 6,277 | | | $ | 6 | | | | – | | | | – | | | $ | 6,283 | |
Pennsylvania Municipal | | $ | 20,124 | | | $ | 79 | | | | – | | | | – | | | $ | 20,203 | |
For the six months ended September 30, 2012, affiliates received the following contingent deferred sales charges as follows:
| | | | | | | | | | | | |
| | | Investor A | | | Investor B | | | Investor C | |
Money Market | | $ | 2,515 | | | $ | 7,937 | | | $ | 5,969 | |
U.S. Treasury | | $ | 4,447 | | | | – | | | | – | |
The Manager and BRIL voluntarily agreed to waive management, service and distribution fees and reimburse operating expenses to enable the Funds to maintain a minimum daily net investment income dividend. These amounts are reported in the Statements of Operations as fees waived by Manager, service and distribution fees waived – class specific and transfer agent fees reimbursed – class specific. The Manager and BRIL may discontinue the waiver or reimbursement at any time.
Certain officers and/or trustees of the Trust are officers and/or directors of BlackRock or its affiliates. The Funds reimburse the Manager for compensation paid to the Trust’s Chief Compliance Officer.
3. Capital Loss Carryforward:
As of March 31, 2012, the Funds had capital loss carryforwards available to offset future realized capital gains through the indicated
expiration dates as follows:
| | | | | | | | |
| Expires March 31, | | Municipal | | | North Carolina Municipal | |
2015 | | $ | 2,336 | | | $ | 6,955 | |
2017 | | | 4,110 | | | | 15,916 | |
Total | | $ | 6,446 | | | $ | 22,871 | |
4. Concentration, Market and Credit Risk:
New Jersey Municipal, North Carolina Municipal, Ohio Municipal, Pennsylvania Municipal and Virginia Municipal invest a substantial amount of their assets in issuers located in a single state or limited number of states. Please see the Schedules of Investments for concentrations in specific states.
In the normal course of business, the Funds invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations (issuer credit risk). The value of securities held by the Funds may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Funds; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to issuer credit risk, the Funds may be exposed to counterparty credit risk, or the risk that an entity with which the Funds have unsettled or open transactions may fail to or be
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 57 |
| | |
| | |
Notes to Financial Statements (continued) | | |
unable to perform on its commitments. The Funds manage counterparty risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is generally approximated by their value as recorded in the Statements of Assets and Liabilities, less any collateral held by the Funds.
Certain obligations held by the Funds have a credit enhancement or liquidity feature that may, under certain circumstances, provide for repayment of principal and interest on the obligation when due. These enhancements, which may include letters of credit, stand-by bond purchase agreements and/or third party insurance, are issued by financial institutions. The value of the obligations may be affected by changes in credit worthiness of the entities that provide the credit enhancements or liquidity features. The Funds monitor their exposure by reviewing the creditworthiness of the issuers, as well as the financial institutions issuing the credit enhancements and by limiting the amount of holdings with credit enhancements from one financial institution.
5. Capital Share Transactions:
The number of shares sold, reinvested and redeemed corresponds to the net proceeds from the sale of shares, reinvestment of dividends and distributions and cost of shares redeemed, respectively, since shares are sold and redeemed at $1.00 per share.
Transactions in capital shares for each class were as follows:
| | | | | | | | |
| Money Market | | Six Months Ended September 30, 2012 | | | Year Ended March 31, 2012 | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 667,469,767 | | | | 1,079,423,505 | |
Shares issued in reinvestment of dividends and distributions | | | 84 | | | | 2,311 | |
Shares redeemed | | | (694,478,543 | ) | | | (1,074,117,874 | ) |
| | | | |
Net increase (decrease) | | | (27,008,692 | ) | | | 5,307,942 | |
| | | | |
| | |
| | | | | | | | |
| |
Service | | | | | | | | |
| |
Shares sold | | | 495,396,003 | | | | 916,280,675 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 21 | |
Shares redeemed | | | (514,982,605 | ) | | | (975,466,593 | ) |
| | | | |
Net decrease | | | (19,586,602 | ) | | | (59,185,897 | ) |
| | | | |
| | | | | | | | |
| Money Market (concluded) | | Six Months Ended September 30, 2012 | | | Year Ended March 31, 2012 | |
| |
Hilliard Lyons | | | | | | | | |
| |
Shares sold | | | – | | | | 8,984,301 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 2 | |
Shares redeemed | | | – | | | | (39,629,650 | ) |
| | | | |
Net decrease | | | – | | | | (30,645,347 | ) |
| | | | |
| | |
| | | | | | | | |
| |
Investor A | | | | | | | | |
| |
Shares sold | | | 224,805,567 | | | | 241,894,678 | |
Shares issued in reinvestment of dividends and distributions | | | 38 | | | | 1,334 | |
Shares redeemed | | | (208,775,927 | ) | | | (257,505,669 | ) |
| | | | |
Net increase (decrease) | | | 16,029,678 | | | | (15,609,657 | ) |
| | | | |
| | |
| | | | | | | | |
| |
Investor B | | | | | | | | |
| |
Shares sold | | | 486,027 | | | | 4,999,150 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 29 | |
Shares redeemed | | | (1,559,242 | ) | | | (5,898,869 | ) |
| | | | |
Net decrease | | | (1,073,215 | ) | | | (899,690 | ) |
| | | | |
| | |
| | | | | | | | |
| |
Investor C | | | | | | | | |
| |
Shares sold | | | 15,886,750 | | | | 60,177,042 | |
Shares issued in reinvestment of dividends and distributions | | | 3 | | | | 166 | |
Shares redeemed | | | (18,909,492 | ) | | | (54,674,890 | ) |
| | | | |
Net increase (decrease) | | | (3,022,739 | ) | | | 5,502,318 | |
| | | | | | | | |
| |
Total Net Decrease | | | (34,661,570 | ) | | | (95,530,331 | ) |
| | | | |
| | |
U.S. Treasury | | | | | | | | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 221,285,250 | | | | 765,842,108 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 398 | |
Shares redeemed | | | (242,630,566 | ) | | | (710,089,481 | ) |
| | | | |
Net increase (decrease) | | | (21,345,316 | ) | | | 55,753,025 | |
| | | | |
| | |
| | | | | | | | |
| |
Service | | | | | | | | |
| |
Shares sold | | | 170,148,584 | | | | 547,678,864 | |
Shares issued in reinvestment of dividends and distributions | | | 2 | | | | 6 | |
Shares redeemed | | | (142,139,642 | ) | | | (567,515,620 | ) |
| | | | |
Net increase (decrease) | | | 28,008,944 | | | | (19,836,750 | ) |
| | | | |
| | | | | | |
| | | | | | | |
| 58 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Notes to Financial Statements (continued) | | |
| | | | | | | | |
| U.S. Treasury (concluded) | | Six Months Ended September 30, 2012 | | | Year Ended March 31, 2012 | |
Investor A | | | | | | | | |
Shares sold | | | 5,971,137 | | | | 29,755,446 | |
Shares issued in reinvestment of dividends and distributions | | | 2 | | | | 221 | |
Shares redeemed | | | (5,173,897 | ) | | | (114,192,100 | ) |
| | | | |
Net increase (decrease) | | | 797,242 | | | | (84,436,433 | ) |
| |
Total Net Increase (Decrease) | | | 7,460,870 | | | | (48,520,158 | ) |
| | | | |
| | |
Municipal | | | | | | | | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 42,583,359 | | | | 125,999,629 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 166 | |
Shares redeemed | | | (48,894,108 | ) | | | (110,258,097 | ) |
| | | | |
Net increase (decrease) | | | (6,310,749 | ) | | | 15,741,698 | |
| | | | |
| | | | | | | | |
| |
Service | | | | | | | | |
| |
Shares sold | | | 54,065,569 | | | | 207,336,980 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 3 | |
Shares redeemed | | | (71,594,992 | ) | | | (185,367,359 | ) |
| | | | |
Net increase (decrease) | | | (17,529,423 | ) | | | 21,969,624 | |
| | | | |
| | | | | | | | |
| |
Hilliard Lyons | | | | | | | | |
| |
Shares sold | | | – | | | | 2,315,734 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 2 | |
Shares redeemed | | | – | | | | (10,745,849 | ) |
| | | | |
Net decrease | | | – | | | | (8,430,113 | ) |
| | | | |
| | | | | | | | |
| |
Investor A | | | | | | | | |
| |
Shares sold | | | 1,047,170 | | | | 1,096,967 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 46 | |
Shares redeemed | | | (200,518 | ) | | | (2,993,108 | ) |
| | | | |
Net increase (decrease) | | | 846,652 | | | | (1,896,095 | ) |
Total Net Increase (Decrease) | | | (22,993,520 | ) | | | 27,385,114 | |
| | | | |
| | |
New Jersey Municipal | | | | | | | | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 21,240,172 | | | | 66,677,879 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 1 | |
Shares redeemed | | | (26,191,506 | ) | | | (71,467,770 | ) |
| | | | |
Net decrease | | | (4,951,334 | ) | | | (4,789,890 | ) |
| | | | |
| | | | | | | | |
New Jersey Municipal (concluded) | | Six Months Ended September 30, 2012 | | | Year Ended March 31, 2012 | |
Service | | | | | | | | |
Shares sold | | | 7,462,990 | | | | 4,482,619 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 164 | |
Shares redeemed | | | (4,511,630 | ) | | | (7,525,634 | ) |
| | | | |
Net increase (decrease) | | | 2,951,360 | | | | (3,042,851 | ) |
| | | | |
| | | | | | | | |
| |
Investor A | | | | | | | | |
| |
Shares sold | | | 1,458 | | | | 2,002,085 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 215 | |
Shares redeemed | | | (65,262 | ) | | | (13,193,610 | ) |
| | | | |
Net decrease | | | (63,804 | ) | | | (11,191,310 | ) |
| |
Total Net Decrease | | | (2,063,778 | ) | | | (19,024,051 | ) |
| | | | |
|
North Carolina Municipal | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 86,613,556 | | | | 168,544,650 | |
Shares issued in reinvestment of dividends and distributions | | | 1 | | | | 2 | |
Shares redeemed | | | (81,513,750 | ) | | | (171,006,899 | ) |
| | | | |
Net increase (decrease) | | | 5,099,807 | | | | (2,462,247 | ) |
| | | | |
| | | | | | | | |
| |
Service | | | | | | | | |
| |
Shares sold | | | 438,563 | | | | 521,320 | |
Shares redeemed | | | (476,416 | ) | | | (594,234 | ) |
| | | | |
Net decrease | | | (37,853 | ) | | | (72,914 | ) |
| | | | |
| | | | | | | | |
| |
Investor A | | | | | | | | |
| |
Shares sold | | | 400 | | | | 12,300 | |
Shares redeemed | | | (36,835 | ) | | | (24,708 | ) |
| | | | |
Net decrease | | | (36,435 | ) | | | (12,408 | ) |
Total Net Increase (Decrease) | | | 5,025,519 | | | | (2,547,569 | ) |
| | | | |
| | |
Ohio Municipal | | | | | | | | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 95,780,540 | | | | 663,166,536 | |
Shares redeemed | | | (101,581,755 | ) | | | (692,620,744 | ) |
| | | | |
Net decrease | | | (5,801,215 | ) | | | (29,454,208 | ) |
| | | | |
| | | | | | | | |
Service | | | | | | | | |
Shares sold | | | 9,191,848 | | | | 7,989,886 | |
Shares redeemed | | | (5,477,449 | ) | | | (7,523,976 | ) |
| | | | |
Net increase | | | 3,714,399 | | | | 465,910 | |
| | | | |
| | | | | | |
| | | | | | | |
| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 59 |
| | |
| | |
Notes to Financial Statements (concluded) | | |
| | | | | | | | |
| Ohio Municipal (concluded) | | Six Months Ended September 30, 2012 | | | Year Ended March 31, 2012 | |
Investor A | | | | | | | | |
Shares sold | | | 9,400 | | | | 648,664 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 1 | |
Shares redeemed | | | (10,291 | ) | | | (6,032,787 | ) |
| | | | |
Net decrease | | | (891 | ) | | | (5,384,122 | ) |
| |
Total Net Decrease | | | (2,087,707 | ) | | | (34,372,420 | ) |
| | | | |
| | |
Pennsylvania Municipal | | | | | | | | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 181,119,601 | | | | 578,902,084 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 9 | |
Shares redeemed | | | (174,899,598 | ) | | | (617,458,417 | ) |
| | | | |
Net increase (decrease) | | | 6,220,003 | | | | (38,556,324 | ) |
| | | | |
| | | | | | | | |
| |
Service | | | | | | | | |
| |
Shares sold | | | 12,100,529 | | | | 33,885,135 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 2 | |
Shares redeemed | | | (11,393,041 | ) | | | (48,207,797 | ) |
| | | | |
Net increase (decrease) | | | 707,488 | | | | (14,322,660 | ) |
| | | | |
| | | | | | | | |
| |
Investor A | | | | | | | | |
| |
Shares sold | | | (53 | ) | | | 5,015,659 | |
Shares issued in reinvestment of dividends and distributions | | | – | | | | 2 | |
Shares redeemed | | | (6,806 | ) | | | (22,376,086 | ) |
| | | | |
Net decrease | | | (6,859 | ) | | | (17,360,425 | ) |
| |
Total Net Increase (Decrease) | | | 6,920,632 | | | | (70,239,409 | ) |
| | | | |
| | | | | | | | |
| Virginia Municipal | | Six Months Ended September 30, 2012 | | | Year Ended March 31, 2012 | |
| |
Institutional | | | | | | | | |
| |
Shares sold | | | 31,118,390 | | | | 80,269,511 | |
Shares issued in reinvestment of dividends and distributions | | | 3 | | | | – | |
Shares redeemed | | | (35,702,575 | ) | | | (86,345,489 | ) |
| | | | |
Net decrease | | | (4,584,182 | ) | | | (6,075,978 | ) |
| | | | |
| | | | | | | | |
| |
Service | | | | | | | | |
| |
Shares sold | | | – | | | | 987,371 | |
Shares redeemed | | | – | | | | (988,179 | ) |
| | | | |
Net decrease | | | – | | | | (808 | ) |
| |
Total Net Decrease | | | (4,584,182 | ) | | | (6,076,786 | ) |
| | | | |
6. Subsequent Events:
Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were issued and has determined that there were no subsequent events requiring adjustment or additional disclosure in the financial statements.
| | | | | | |
| | | | | | | |
| 60 | | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | |
| | |
| | |
Disclosure of Investment Advisory Agreement | | |
The Board of Trustees (the “Board,” and the members of which are referred to as “Board Members”) of BlackRock FundsSM (the “Trust”) met on April 17, 2012 and May 15-16, 2012 to consider the approval of the Trust’s investment advisory agreement (the “Agreement”) with BlackRock Advisors, LLC (“BlackRock”), the Trust’s investment advisor, on behalf of each of the Money Market Portfolios of the Trust (each, a “Fund,” and together, the “Funds”).
Activities and Composition of the Board
The Board consists of fourteen individuals, twelve of whom are not “interested persons” of the Trust as defined in the Investment Company Act of 1940, as amended (the “1940 Act”) (the “Independent Board Members”). The Board Members are responsible for the oversight of the operations of each Fund and perform the various duties imposed on the directors of investment companies by the 1940 Act. The Independent Board Members have retained independent legal counsel to assist them in connection with their duties. The Co-Chairs of the Board are each Independent Board Members. The Board has established five standing committees: an Audit Committee, a Governance and Nominating Committee, a Compliance Committee, a Performance Oversight and Contract Committee and an Executive Committee, each of which is chaired by an Independent Board Member and composed of Independent Board Members (except for the Executive Committee, which also has one interested Board Member).
The Agreement
Pursuant to the 1940 Act, the Board is required to consider the continuation of the Agreement on an annual basis. The Board has four quarterly meetings per year, each extending over two days, and a fifth meeting to consider specific information surrounding the consideration of renewing the Agreement. In connection with this process, the Board assessed, among other things, the nature, scope and quality of the services provided to the Funds by BlackRock, its personnel and its affiliates, including investment management, administrative and shareholder services, oversight of fund accounting and custody, marketing services, risk oversight, compliance and assistance in meeting applicable legal and regulatory requirements.
The Board, acting directly and through its committees, considers at each of its meetings, and from time to time as appropriate, factors that are relevant to its annual consideration of the renewal of the Agreement, including the services and support provided by BlackRock to the Funds and their shareholders. Among the matters the Board considered, with respect to each Fund, were: (a) investment performance for one-, three-and five-year periods, as applicable, against peer funds, and applicable benchmarks, if any, as well as senior management’s and portfolio managers’ analysis of the reasons for any over performance or underperformance against its peers and/or benchmark, as applicable; (b) fees, including advisory, administration, if applicable, and other amounts paid to BlackRock and its affiliates by the Fund for services, such as marketing and distribution, call center and fund accounting; (c) Fund operating expenses and how BlackRock allocates expenses to the Fund; (d) the resources devoted to, risk oversight of, and compliance
reports relating to, implementation of the Fund’s investment objective, policies and restrictions; (e) the Trust’s compliance with its Code of Ethics and other compliance policies and procedures; (f) the nature, cost and character of non-investment management services provided by BlackRock and its affiliates; (g) BlackRock’s and other service providers’ internal controls and risk and compliance oversight mechanisms; (h) BlackRock’s implementation of the proxy voting policies approved by the Board; (i) execution quality of portfolio transactions; (j) BlackRock’s implementation of the Trust’s valuation and liquidity procedures; (k) an analysis of management fees for products with similar investment objectives across the open-end fund, exchange traded fund (“ETF”), closed-end fund and institutional account product channels, as applicable; (l) BlackRock’s compensation methodology for its investment professionals and the incentives it creates; and (m) periodic updates on BlackRock’s business.
The Board has engaged in an ongoing strategic review with BlackRock of opportunities to consolidate funds and of BlackRock’s commitment to investment performance. In addition, the Board requested, to the extent reasonably possible, an analysis of the risk and return relative to selected funds in peer groups. BlackRock provides information to the Board in response to specific questions. These questions covered issues such as profitability, investment performance and management fee levels. The Board considered the importance of: (i) managing fixed income assets with a view toward preservation of capital; (ii) portfolio managers’ investments in the funds they manage; (iii) BlackRock’s controls surrounding the coding of quantitative investment models; and (iv) BlackRock’s oversight of relationships with third party service providers.
Board Considerations in Approving the Agreement
The Approval Process: Prior to the April 17, 2012 meeting, the Board requested and received materials specifically relating to the Agreement. The Board is engaged in a process with its independent legal counsel and BlackRock to review periodically the nature and scope of the information provided to better assist its deliberations. The materials provided in connection with the April meeting included (a) information independently compiled and prepared by Lipper, Inc. (“Lipper”) on Fund fees and expenses and the investment performance of each Fund as compared with a peer group of funds as determined by Lipper (collectively, “Peers”); (b) information on the profitability of the Agreement to BlackRock and a discussion of fall-out benefits to BlackRock and its affiliates; (c) a general analysis provided by BlackRock concerning investment management fees (a combination of the advisory fee and the administration fee, if any) charged to other clients, such as institutional clients, ETFs and closed-end funds, under similar investment mandates, as well as the performance of such other clients, as applicable; (d) the existence, impact and sharing of potential economies of scale; (e) a summary of aggregate amounts paid by each Fund to BlackRock; (f) sales and redemption data regarding each Fund’s shares; and (g) if applicable, a comparison of management fees to similar BlackRock open-end funds, as classified by Lipper.
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At an in-person meeting held on April 17, 2012, the Board reviewed materials relating to its consideration of the Agreement. As a result of the discussions that occurred during the April 17, 2012 meeting, and as a culmination of the Board’s year-long deliberative process, the Board presented BlackRock with questions and requests for additional information. BlackRock responded to these requests with additional written information in advance of the May 15-16, 2012 Board meeting.
At an in-person meeting held on May 15-16, 2012, the Board, including all the Independent Board Members, unanimously approved the continuation of the Agreement between BlackRock and the Trust with respect to each Fund for a one-year term ending June 30, 2013. In approving the continuation of the Agreement, the Board considered: (a) the nature, extent and quality of the services provided by BlackRock; (b) the investment performance of each Fund and BlackRock; (c) the advisory fee and the cost of the services and profits to be realized by BlackRock and its affiliates from their relationship with the Funds; (d) economies of scale; (e) fall-out benefits to BlackRock as a result of its relationship with the Funds; and (f) other factors deemed relevant by the Board Members.
The Board also considered other matters it deemed important to the approval process, such as payments made to BlackRock or its affiliates relating to the distribution of Fund shares and securities lending, services related to the valuation and pricing of Fund portfolio holdings, direct and indirect benefits to BlackRock and its affiliates from their relationship with the Funds and advice from independent legal counsel with respect to the review process and materials submitted for the Board’s review. The Board noted the willingness of BlackRock personnel to engage in open, candid discussions with the Board. The Board did not identify any particular information as controlling, and each Board Member may have attributed different weights to the various items considered.
A. Nature, Extent and Quality of the Services Provided by BlackRock: The Board, including the Independent Board Members, reviewed the nature, extent and quality of services provided by BlackRock, including the investment advisory services and the resulting performance of each Fund. Throughout the year, the Board compared each Fund’s performance to the performance of a comparable group of mutual funds and/or the performance of a relevant benchmark, if any. The Board met with BlackRock’s senior management personnel responsible for investment operations, including the senior investment officers. The Board also reviewed the materials provided by each Fund’s portfolio management team discussing Fund performance and the Fund’s investment objective, strategies and outlook.
The Board considered, among other factors, the number, education and experience of BlackRock’s investment personnel generally and each Fund’s portfolio management team, investments by portfolio managers in the funds they manage, BlackRock’s portfolio trading capabilities, BlackRock’s use of technology, BlackRock’s commitment to compliance, BlackRock’s credit analysis capabilities, BlackRock’s risk analysis and oversight capabilities and BlackRock’s approach to training and retaining portfolio managers and other research, advisory and management per-
sonnel. The Board engaged in a review of BlackRock’s compensation structure with respect to each Fund’s portfolio management team and BlackRock’s ability to attract and retain high-quality talent and create performance incentives.
In addition to advisory services, the Board considered the quality of the administrative and non-investment advisory services provided to the Funds. BlackRock and its affiliates provide the Funds with certain administrative, shareholder and other services (in addition to any such services provided to the Funds by third parties) and officers and other personnel as are necessary for the operations of the Funds. In particular, BlackRock and its affiliates provide the Funds with the following administrative services, including, among others: (i) preparing disclosure documents, such as the prospectus, the statement of additional information and periodic shareholder reports; (ii) assisting with daily accounting and pricing; (iii) overseeing and coordinating the activities of other service providers; (iv) organizing Board meetings and preparing the materials for such Board meetings; (v) providing legal and compliance support; and (vi) performing other administrative functions necessary for the operation of the Funds, such as tax reporting, fulfilling regulatory filing requirements and call center services. The Board reviewed the structure and duties of BlackRock’s fund administration, accounting, legal and compliance departments and considered BlackRock’s policies and procedures for assuring compliance with applicable laws and regulations.
B. The Investment Performance of each Fund and BlackRock: The Board, including the Independent Board Members, also reviewed and considered the performance history of each Fund. In preparation for the April 17, 2012 meeting, the Board worked with its independent legal counsel, BlackRock and Lipper to develop a template for, and was provided with, reports independently prepared by Lipper, which included a comprehensive analysis of each Fund’s performance. The Board also reviewed a narrative and statistical analysis of the Lipper data that was prepared by BlackRock, which analyzed various factors that affect Lipper’s rankings. In connection with its review, the Board received and reviewed information regarding the investment performance of each Fund as compared to funds in the Fund’s applicable Lipper category. The Board was provided with a description of the methodology used by Lipper to select peer funds and periodically meets with Lipper representatives to review their methodology. The Board and the Board’s Performance Oversight and Contract Committee regularly review, and meet with Fund management to discuss, the performance of each Fund throughout the year.
The Board noted that, in general, the Ohio Municipal Money Market Portfolio performed within the one basis point threshold of its Lipper Performance Universe Peer median for the one-year period reported, and the Fund performed at or above the Peer median of its Lipper Performance Universe in both of the three- and five-year periods reported.
The Board noted that, in general, the Money Market Portfolio and the U.S. Treasury Money Market Portfolio each performed within the one basis point threshold of its Lipper Performance Universe Peer median for
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the one-year period reported, and each Fund performed at or above the Peer median of its Lipper Performance Universe in either the three- or five-year periods reported.
The Board noted that the Municipal Money Market Portfolio and the New Jersey Municipal Money Market Portfolio each performed below the median of its Lipper Performance Universe in the three- and five-year periods reported, but that each Fund performed at or above the median of its Lipper Performance Universe in the one-year period reported.
The Board noted that the North Carolina Municipal Money Market Portfolio, the Pennsylvania Municipal Money Market Portfolio and the Virginia Municipal Money Market Portfolio each performed below the median of its Lipper Performance Universe in the three- and five-year periods reported, but that each Fund performed within one basis point of its Peer median for the one-year period reported.
The Board and BlackRock reviewed and discussed the reasons for the underperformance of each of the Municipal Money Market Portfolio, the New Jersey Municipal Money Market Portfolio, the North Carolina Municipal Money Market Portfolio, the Pennsylvania Municipal Money Market Portfolio and the Virginia Municipal Money Market Portfolio during the three- and five-year periods compared with its Peers. The Board was informed that, among other things, the combination of an extremely flat yield curve and the need for greater levels of liquidity due to shrinking assets has hindered the performance of these Funds. The Board and BlackRock also discussed BlackRock’s strategy for improving the performance of these Funds and BlackRock’s commitment to providing the resources necessary to assist the portfolio managers of these Funds and to improve the Funds’ performance.
C. Consideration of the Advisory/Management Fees and the Cost of the Services and Profits to be Realized by BlackRock and its Affiliates from their Relationship with the Funds: The Board, including the Independent Board Members, reviewed each Fund’s contractual management fee rate compared with the other funds in its Lipper category. It also compared each Fund’s total expense ratio, as well as actual management fee rate, to those of other funds in its Lipper category. The Board considered the services provided and the fees charged by BlackRock to other types of clients with similar investment mandates, including separately managed institutional accounts.
The Board received and reviewed statements relating to BlackRock’s financial condition and profitability with respect to the services it provided the Funds. The Board was also provided with a profitability analysis that detailed the revenues earned and the expenses incurred by BlackRock for services provided to the Funds. The Board reviewed BlackRock’s profitability with respect to the Funds and other funds the Board currently oversees for the year ended December 31, 2011 compared to available aggregate profitability data provided for the years ended December 31, 2010 and December 31, 2009. The Board reviewed BlackRock’s profitability with respect to other fund complexes managed by BlackRock and/or its affiliates. The Board reviewed BlackRock’s assumptions and methodology of allocating expenses in the
profitability analysis, noting the inherent limitations in allocating costs among various advisory products. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers and expense reimbursements by BlackRock, the types of funds managed, expense allocations and business mix, and the difficulty of comparing profitability as a result of those factors.
The Board noted that, in general, individual fund or product line profitability of other advisors is not publicly available. The Board considered BlackRock’s operating margin, in general, compared to the operating margin for leading investment management firms whose operations include advising open-end funds, among other product types. In addition, the Board considered, among other things, certain third party data comparing BlackRock’s operating margin with that of other publicly-traded asset management firms. The Board considered the differences between BlackRock and these other firms, including the contribution of technology at BlackRock, BlackRock’s expense management and the relative product mix.
In addition, the Board considered the cost of the services provided to the Funds by BlackRock, and BlackRock’s and its affiliates’ profits relating to the management and distribution of the Funds and the other funds advised by BlackRock and its affiliates. As part of its analysis, the Board reviewed BlackRock’s methodology in allocating its costs to the management of each Fund. The Board also considered whether BlackRock has the financial resources necessary to attract and retain high quality investment management personnel to perform its obligations under the Agreement and to continue to provide the high quality of services that is expected by the Board.
The Board noted that the contractual management fee ratio (a combination of the advisory fee and the administration fee, if any) of each of the Ohio Municipal Money Market Portfolio and the Pennsylvania Municipal Money Market Portfolio was above the median contractual management fee ratio paid by the Fund’s Peers, in each case before taking into account any expense reimbursements or fee waivers. The Board also noted, however, that each Fund’s contractual management fee ratio was reasonable relative to the median contractual management fee ratio paid by the Fund’s Peers.
The Board noted that the contractual management fee ratio (a combination of the advisory fee and the administration fee, if any) of each of the Municipal Money Market Portfolio, the North Carolina Municipal Money Market Portfolio and the Virginia Municipal Money Market Portfolio was above the median contractual management fee ratio paid by the Fund’s Peers, in each case before taking into account any expense reimbursements or fee waivers. The Board also noted, however, that each Fund’s actual management fee ratio, after giving effect to any expense reimbursement or fee waivers by BlackRock and/or other parties, if applicable, was lower than or equal to the median actual management fee ratio paid by the Fund’s Peers, after giving effect to any expense reimbursements or fee waivers.
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The Board noted that the U.S. Treasury Money Market Portfolio’s contractual management fee ratio (a combination of the advisory fee and the administration fee, if any) was above the median contractual management fee ratio paid by the Fund’s Peers, in each case before taking into account any expense reimbursements or fee waivers. The Board also noted, however, that the Fund’s actual management fee ratio, after giving effect to any expense reimbursements or fee waivers by BlackRock and/or other parties, if applicable, was reasonable relative to the median actual management fee ratio paid by the Fund’s Peers, after giving effect to any expense reimbursements or fee waivers.
The Board noted that the Money Market Portfolio’s contractual management fee ratio (a combination of the advisory fee and the administration fee, if any) was above the median contractual management fee ratio paid by the Fund’s Peers, in each case before taking into account any expense reimbursements or fee waivers. The Board also noted, however, that the Fund’s actual total expense ratio, after giving effect to any expense reimbursements or fee waivers by BlackRock and/or other parties, if applicable, was lower than or equal to the median actual total expense ratio paid by the Fund’s Peers, after giving effect to any expense reimbursements or fee waivers.
The Board noted that the New Jersey Municipal Money Market Portfolio’s contractual management fee ratio (a combination of the advisory fee and the administration fee, if any) was above the median contractual management fee ratio paid by the Fund’s Peers, in each case before taking into account any expense reimbursements or fee waivers. The Board also noted, however, that although the Fund’s contractual management fee ratio was above the median contractual management fee ratio paid by the Fund’s Peers, the contractual management fee ratio was in the third quartile.
The Board also noted that with respect to the New Jersey Municipal Money Market Portfolio, the North Carolina Municipal Money Market Portfolio, the Ohio Municipal Money Market Portfolio, the Pennsylvania Municipal Money Market Portfolio, the U.S. Treasury Money Market Portfolio and the Virginia Municipal Money Market Portfolio, BlackRock has contractually agreed to waive fees and/or reimburse expenses in order to limit, to a specified amount, the Fund’s total operating expenses as a percentage of the Fund’s average daily net assets on a class-by-class basis, as applicable, and that with respect to the Money Market Portfolio and the Municipal Money Market Portfolio, BlackRock has contractually and/or voluntarily agreed to waive fees and/or reimburse expenses in order to limit, to a specified amount, the Fund’s total operating expenses as a percentage of the Fund’s average daily net assets, on a class-by-class basis, as applicable. The Board further noted that each Fund has an advisory fee arrangement that includes breakpoints that adjust the fee rate downward as the size of the Fund increases above certain contractually specified levels. The Board additionally noted that BlackRock and the Funds’ distributor have voluntarily agreed to waive a portion of their respective fees and/or reimburse operating expenses to enable each Fund to maintain a minimum level of daily net investment income. This waiver and/or reimbursement may be discontinued at any time without notice.
D. Economies of Scale: The Board, including the Independent Board Members, considered the extent to which economies of scale might be realized as the assets of each Fund increase, as well as the existence of expense caps. The Board also considered the extent to which each Fund benefits from such economies and whether there should be changes in the advisory fee rate or structure in order to enable the Fund to participate in these economies of scale, for example through the use of revised breakpoints in the advisory fee based upon the asset level of the Fund. In its consideration, the Board Members took into account the existence of expense caps and further considered the continuation and/or implementation, as applicable, of such caps.
E. Other Factors Deemed Relevant by the Board Members: The Board, including the Independent Board Members, also took into account other ancillary or “fall-out” benefits that BlackRock or its affiliates may derive from their respective relationships with the Funds, both tangible and intangible, such as BlackRock’s ability to leverage its investment professionals who manage other portfolios and risk management personnel, an increase in BlackRock’s profile in the investment advisory community, and the engagement of BlackRock’s affiliates as service providers to the Funds, including for administrative, distribution, securities lending and cash management services. The Board also considered BlackRock’s overall operations and its efforts to expand the scale of, and improve the quality of, its operations. The Board also noted that BlackRock may use and benefit from third party research obtained by soft dollars generated by certain registered fund transactions to assist in managing all or a number of its other client accounts. The Board further noted that it had considered the investment by BlackRock’s funds in ETFs without any offset against the management fees payable by the funds to BlackRock.
In connection with its consideration of the Agreement, the Board also received information regarding BlackRock’s brokerage and soft dollar practices. The Board received reports from BlackRock which included information on brokerage commissions and trade execution practices throughout the year.
The Board noted the competitive nature of the open-end fund marketplace, and that shareholders are able to redeem their Fund shares if they believe that a Fund’s fees and expenses are too high or if they are dissatisfied with the performance of a Fund.
Conclusion
The Board, including all the Independent Board Members, unanimously approved the continuation of the Agreement between BlackRock and the Trust, with respect to each Fund, for a one-year term ending June 30, 2013. Based upon its evaluation of all of the aforementioned factors in their totality, the Board, including the Independent Board Members, was satisfied that the terms of the Agreement were fair and reasonable and in the best interest of each Fund and its shareholders. In arriving at its decision to approve the Agreement, the Board did not identify any single factor or group of factors as all-important or controlling, but considered all factors together, and different Board Members may have attributed different weights to the various factors considered. The Independent Board Members were also assisted by the advice of independent legal
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counsel in making this determination. The contractual fee arrangements for the Funds reflect the results of several years of review by the Board Members and predecessor Board Members, and discussions between
such Board Members (and predecessor Board Members) and BlackRock. As a result, the Board Members’ conclusions may be based in part on their consideration of these arrangements in prior years.
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| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 65 |
Ronald W. Forbes, Co-Chairman of the Board and Trustee
Rodney D. Johnson, Co-Chairman of the Board and Trustee
Paul L. Audet, Trustee
David O. Beim, Trustee
Henry Gabbay, Trustee
Dr. Matina S. Horner, Trustee
Herbert I. London, Trustee
Ian A. MacKinnon, Trustee
Cynthia A. Montgomery, Trustee
Joseph P. Platt, Trustee
Robert C. Robb, Jr., Trustee
Toby Rosenblatt, Trustee
Kenneth L. Urish, Trustee
Frederick W. Winter, Trustee
John M. Perlowski, President and Chief Executive Officer
Richard Hoerner, CFA, Vice President
Brendan Kyne, Vice President
Simon Mendelson, Vice President
Christopher Stavrakos, CFA, Vice President
Neal Andrews, Chief Financial Officer
Jay Fife, Treasurer
Brian Kindelan, Chief Compliance Officer and Anti-Money Laundering Officer
Benjamin Archibald, Secretary
Investment Advisor and Co-Administrator
BlackRock Advisors, LLC
Wilmington, DE 19809
Distributor
BlackRock Investments, LLC
New York, NY 10022
Accounting Agent, Co-Administrator and Transfer Agent
BNY Mellon Investment Servicing (US) Inc. Wilmington, DE 19809
Custodian
The Bank of New York Mellon
New York, NY 10286
Legal Counsel
Sidley Austin LLP
New York, NY 10019
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
Philadelphia, PA 19103
Address of the Trust
100 Bellevue Parkway
Wilmington, DE 19809
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Effective May 15, 2012, Ian A. MacKinnon became Trustee of the Trust. Effective May 16, 2012 Ira P. Shapiro resigned as Secretary of the Trust and Benjamin Archibald became Secretary of the Trust. |
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Electronic Delivery
Electronic copies of most financial reports and prospectuses are available on the Funds’ website or shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual reports and prospectuses by enrolling in the Funds’ electronic delivery program.
To enroll:
Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages:
Please contact your financial advisor. Please note that not all investment advisors, banks or brokerages may offer this service.
Shareholders Who Hold Accounts Directly With BlackRock:
| 1) | Access the BlackRock website at http://www.blackrock.com/edelivery |
| 2) | Select “eDelivery” under the “More Information” section |
Householding
The Funds will mail only one copy of shareholder documents, including prospectuses, annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call the Funds at (800) 441-7762.
Availability of Quarterly Schedule of Investments
The Funds file their complete schedule of portfolio holdings with the Securities and Exchange Commission’s (the “SEC”) for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC’s website at http://www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on how to access documents on the SEC’s website without charge may be obtained by calling (800) SEC-0330. The Funds’ Forms N-Q may also be obtained upon request and without charge by calling (800) 441-7762.
Availability of Proxy Voting Policies and Procedures
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling (800) 441-7762; (2) at http://www.blackrock.com; and (3) on the SEC’s website at http:// www.sec.gov.
Availability of Proxy Voting Record
Information about how the Funds voted proxies relating to securities held in the Funds’ portfolios during the most recent 12-month period ended June 30 is available upon request and without charge (1) at http://www.blackrock.com or by calling (800) 441-7762 and (2) on the SEC’s website at http://www.sec.gov.
Account Information
Call us at (800) 441-7762 from 8:00 AM to 6:00 PM EST on any business day to get information about your account balances, recent transactions and share prices. You can also reach us on the Web at http:// www.blackrock.com/funds.
Automatic Investment Plans
Investor Class shareholders who want to invest regularly can arrange to have $50 or more automatically deducted from their checking or savings account and invested in any of the BlackRock funds.
Systematic Withdrawal Plan
Investor Class shareholders can establish a systematic withdrawal plan and receive periodic payments of $50 or more from their BlackRock funds, as long as their account balance is at least $10,000.
Retirement Plans
Shareholders may make investments in conjunction with Traditional, Rollover, Roth, Coverdell, Simple IRAs, SEP IRAs and 403(b) Plans.
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| BlackRock Privacy Principles | | | | | | |
BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.
If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.
BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.
BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.
We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.
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A World-Class Mutual Fund Family | | |
BlackRock offers a diverse lineup of open-end mutual funds crossing all investment styles and managed by experts in equity, fixed income and tax-exempt investing.
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BlackRock ACWI ex-US Index Fund BlackRock All-Cap Energy & Resources Portfolio BlackRock Balanced Capital Fund† BlackRock Basic Value Fund BlackRock Capital Appreciation Fund BlackRock China Fund BlackRock Commodity Strategies Fund BlackRock Emerging Markets Fund BlackRock Emerging Markets
Long/Short Equity Fund BlackRock Energy & Resources Portfolio BlackRock Equity Dividend Fund BlackRock Euro Fund BlackRock Flexible Equity Fund BlackRock Focus Growth Fund BlackRock Global Allocation Fund† | | BlackRock Global Dividend Income Portfolio BlackRock Global Opportunities Portfolio BlackRock Global SmallCap Fund BlackRock Health Sciences Opportunities Portfolio BlackRock Index Equity Portfolio BlackRock India Fund BlackRock International Fund BlackRock International Index Fund BlackRock International Opportunities Portfolio BlackRock Large Cap Core Fund BlackRock Large Cap Core Plus Fund BlackRock Large Cap Growth Fund BlackRock Large Cap Value Fund BlackRock Latin America Fund BlackRock Long-Horizon Equity Fund BlackRock Managed Volatility Portfolio† | | BlackRock Mid-Cap Growth Equity Portfolio BlackRock Mid-Cap Value Opportunities Fund BlackRock Natural Resources Trust BlackRock Pacific Fund BlackRock Real Estate Securities Fund BlackRock Russell 1000 Index Fund BlackRock Science & Technology Opportunities Portfolio BlackRock Small Cap Growth Equity Portfolio BlackRock Small Cap Growth Fund II BlackRock Small Cap Index Fund BlackRock S&P 500 Index Fund BlackRock S&P 500 Stock Fund BlackRock U.S. Opportunities Portfolio BlackRock Value Opportunities Fund BlackRock World Gold Fund |
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| Taxable Fixed Income Funds | | | | |
BlackRock Bond Index Fund BlackRock Core Bond Portfolio BlackRock CoreAlpha Bond Fund BlackRock Emerging Market Local Debt Portfolio BlackRock Floating Rate Income Portfolio BlackRock Global Long/Short Credit Fund BlackRock GNMA Portfolio | | BlackRock High Yield Bond Portfolio BlackRock Inflation Protected Bond Portfolio BlackRock International Bond Portfolio BlackRock Long Duration Bond Portfolio BlackRock Low Duration Bond Portfolio BlackRock Multi-Asset Income Portfolio† BlackRock Secured Credit Portfolio | | BlackRock Strategic Income Opportunities Portfolio BlackRock Total Return Fund BlackRock US Government Bond Portfolio BlackRock US Mortgage Portfolio BlackRock World Income Fund |
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| Municipal Fixed Income Funds | | | | |
BlackRock California Municipal Bond Fund BlackRock High Yield Municipal Fund BlackRock Intermediate Municipal Fund | | BlackRock National Municipal Fund BlackRock New Jersey Municipal Bond Fund BlackRock New York Municipal Bond Fund | | BlackRock Pennsylvania Municipal Bond Fund BlackRock Short-Term Municipal Fund |
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| Target Risk & Target Date Funds† |
BlackRock Prepared Portfolios | | | LifePath Active Portfolios | | | LifePath Portfolios | | | | LifePath Index Portfolios | | |
Conservative Prepared Portfolio | | | 2015 | | | | 2035 | | | | | Retirement | | 2040 | | | | Retirement | | 2040 |
Moderate Prepared Portfolio | | | 2020 | | | | 2040 | | | | | 2020 | | 2045 | | | | 2020 | | 2045 |
Growth Prepared Portfolio | | | 2025 | | | | 2045 | | | | | 2025 | | 2050 | | | | 2025 | | 2050 |
Aggressive Growth Prepared Portfolio | | | 2030 | | | | 2050 | | | | | 2030 | | 2055 | | | | 2030 | | 2055 |
| | | | | | | | | | | | 2035 | | | | | | 2035 | | |
† Mixed asset fund.
BlackRock mutual funds are currently distributed by BlackRock Investments, LLC. You should consider the investment objectives, risks, charges and expenses of the funds under consideration carefully before investing. Each fund’s prospectus contains this and other information and is available at www.blackrock.com or by calling (800) 441-7762 or from your financial advisor. The prospectus should be read carefully before investing.
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| | BLACKROCK FUNDS | | SEPTEMBER 30, 2012 | | 69 |
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This report is transmitted to shareholders only. It is not authorized for use as an offer of sale or a solicitation of an offer to buy shares of the Funds unless accompanied or preceded by the Funds’ current prospectus. An investment in a Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in a Fund. Performance data quoted represents past performance and does not guarantee future results. Total return information assumes reinvestment of all distributions. Current performance may be higher or lower than the performance data quoted. For current month-end performance information, call (800) 441-7762. The Funds’ current 7-day yield more closely reflects the current earnings of a Fund than the total returns quoted. Statements and other information herein are as dated and are subject to change.
MM-9/12-SAR
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Item 2 – | | Code of Ethics – Not Applicable to this semi-annual report |
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Item 3 – | | Audit Committee Financial Expert – Not Applicable to this semi-annual report |
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Item 4 – | | Principal Accountant Fees and Services – Not Applicable to this semi-annual report |
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Item 5 – | | Audit Committee of Listed Registrants – Not Applicable |
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Item 6 – | | Investments |
| | (a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this Form. |
| | (b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing. |
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Item 7 – | | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not Applicable |
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Item 8 – | | Portfolio Managers of Closed-End Management Investment Companies – Not Applicable |
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Item 9 – | | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable |
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Item 10 – | | Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures. |
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Item 11 – | | Controls and Procedures |
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| | (a) – The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 15d-15(b) under the Securities Exchange Act of 1934, as amended. |
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| | (b) – There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
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Item 12 – | | Exhibits attached hereto |
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| | (a)(1) – Code of Ethics – Not Applicable to this semi-annual report |
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| | (a)(2) – Certifications – Attached hereto |
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| | (a)(3) – Not Applicable |
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| | (b) – Certifications – Attached hereto |
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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.
BlackRock Funds
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By: | | /s/ John M. Perlowski | | |
| | John M. Perlowski | | |
| | Chief Executive Officer (principal executive officer) of | | |
| | BlackRock Funds | | |
Date: December 3, 2012
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.
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By: | | /s/ John M. Perlowski | | |
| | John M. Perlowski | | |
| | Chief Executive Officer (principal executive officer) of | | |
| | BlackRock Funds | | |
Date: December 3, 2012
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By: | | /s/ Neal J. Andrews | | |
| | Neal J. Andrews | | |
| | Chief Financial Officer (principal financial officer) of | | |
| | BlackRock Funds | | |
Date: December 3, 2012
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