UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSRS

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-5569
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FRANKLIN UNIVERSAL TRUST
------------------------
(Exact name of registrant as specified in charter)

ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
(Address of principal executive offices) (Zip code)

MURRAY L. SIMPSON, ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
-----------------------------------------------------------------
(Name and address of agent for service)

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

Date of fiscal year end: 08/31
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Date of reporting period: 2/29/04
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ITEM 1. REPORTS TO STOCKHOLDERS.

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SEMIANNUAL REPORT AND SHAREHOLDER INFORMATION

INCOME

Franklin Universal Trust

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[LOGO OMITTED]
FRANKLIN(R) TEMPLETON(R)
INVESTMENTS
FRANKLIN o Templeton o Mutual Series

Franklin Templeton Investments

GAIN FROM OUR PERSPECTIVE

Franklin Templeton's distinct multi-manager structure combines the specialized
expertise of three world-class investment management groups--Franklin, Templeton
and Mutual Series.

SPECIALIZED EXPERTISE

Each of our portfolio management groups operates autonomously, relying on its
own research and staying true to the unique investment disciplines that underlie
its success.

FRANKLIN. Founded in 1947, Franklin is a leader in tax-free investing and a
driving force in fixed income investing around the globe. They also bring
expertise in growth- and value-style U.S. equity investing.

TEMPLETON. Founded in 1940, Templeton pioneered international investing and, in
1954, launched what has become the industry's oldest global fund. Today, with
research offices in over 25 countries, they offer investors the broadest global
reach in the industry.

MUTUAL SERIES. Established in 1949, Mutual Series is dedicated to a unique style
of value investing, searching aggressively for opportunity among undervalued
stocks, arbitrage situations and distressed companies.

TRUE DIVERSIFICATION

Because our management groups work independently and adhere to distinctly
different investment approaches, Franklin, Templeton and Mutual Series funds
typically have a low overlap of securities. That's why our funds can be used to
build truly diversified portfolios covering every major asset class.

RELIABILITY YOU CAN TRUST

At Franklin Templeton Investments, we seek to consistently provide investors
with exceptional risk-adjusted returns over the long term, as well as the
reliable account services that have helped us become one of the most trusted
names in financial services.

MUTUAL FUNDS | RETIREMENT PLANS | 529 COLLEGE SAVINGS PLANS | SEPARATE ACCOUNTS

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Not part of the semiannual report

Contents

SEMIANNUAL REPORT

Franklin Universal Trust ......................... 1

Performance Summary .............................. 5

Annual Shareholders' Meeting ..................... 6

Dividend Reinvestment and
Cash Purchase Plan ............................... 7

Financial Highlights and
Statement of Investments ......................... 10

Financial Statements ............................. 17

Notes to Financial Statements .................... 21

Proxy Voting Policies and Procedures ............. 27

Semiannual Report

Franklin Universal Trust

YOUR FUND'S GOALS: Franklin Universal Trust's primary investment objective is to
provide high, current income consistent with preservation of capital. Its
secondary objective is growth of income through dividend increases and capital
appreciation.

Dear Shareholder:

We are pleased to bring you Franklin Universal Trust's (the Fund's) semiannual
report, which covers the period ended February 29, 2004.

PERFORMANCE OVERVIEW

During the six months under review, the Fund's cumulative total return was
+17.65% based on change in net asset value and +16.44% based on change in market
price on the New York Stock Exchange, as shown in the Performance Summary on
page 5. For comparison, the Credit Suisse First Boston (CSFB) High Yield Index
returned 10.88%, and utilities stocks, as measured by the Standard & Poor's
(S&P) Utilities Index, returned 17.41% for the six months ended February 29,
2004. 1

1. Source: Standard & Poor's Micropal. The CSFB High Yield Index is a
trader-priced portfolio constructed to mirror the high yield debt market and
includes reinvested interest. The S&P Utilities Index is a market
capitalization-weighted index that includes utility stocks in the Standard &
Poor's 500 Composite Index. The index includes reinvested dividends. The indexes
are unmanaged. One cannot invest directly in an index, nor is an index
representative of the Fund's portfolio.

THE DOLLAR VALUE, NUMBER OF SHARES OR PRINCIPAL AMOUNT, AND NAMES OF ALL
PORTFOLIO HOLDINGS ARE LISTED IN THE FUND'S STATEMENT OF INVESTMENTS (SOI). THE
SOI BEGINS ON PAGE 11.

Semiannual Report | 1

[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC AS FOLLOWS:

PORTFOLIO BREAKDOWN
Based on Gross Assets*
2/29/04
Corporate Bonds 67.5%
Utilities Common Stocks 21.2%
Misc. Common & Preferred Stocks 4.1%
Foreign Government U.S. Dollar-Denominated Bonds 3.8%
Convertible Bonds 1.1%
Natural Resource Common Stocks 1.0%
Foreign Government Agencies 0.3%
Cash & Other Net Assets 1.0%
*The calculation of percentages is based on total net assets plus the senior
note issued by the Fund.

ECONOMIC AND MARKET OVERVIEW

During the six months under review, many factors impacted the U.S. economy and
financial markets. While the uneven economic recovery and continuing
geopolitical instability created an uncertain environment, signs that the
economic recovery was gaining traction helped to drive up most financial
markets. Third quarter 2003 gross domestic product (GDP) grew an annualized
8.2%, its strongest pace in nearly 20 years, while fourth quarter GDP grew a
solid 4.1%. Although 10-year Treasury yields rose during summer 2003 on fears
that inflation would resurface, they fell during the past six months, ending the
period below 4% as inflation remained benign. The U.S. trade deficit continued
to increase, which contributed to a decline in the U.S. dollar versus the euro
and other major currencies. However, the weak dollar benefited U.S. exports,
thus boosting the overall economy. Consumer spending remained healthy, as low
mortgage rates helped the housing market. Business spending rebounded during the
period, particularly for equipment and software, which also contributed to the
strong pace of economic growth.

High yield bonds, as measured by the CSFB High Yield Index, returned 10.88%
during the six months ended February 29, 2004, as the economic recovery led to
expectations of improving operating results, better credit fundamentals and a
declining default rate. 1 As investors gained comfort with the outlook for high
yield bonds, the yield spread over comparable Treasury bonds narrowed from 5.9
percentage points to 4.9 percentage points. 2

Utility stocks returned 17.41% during the period, as measured by the S&P
Utilities Index. 1 Utility stock performance was partly driven by the rebound in
prices for some recently troubled companies, as non-dividend paying utilities
represented four of the top five best-performing utility stocks during the
period. Largely as a result, many dividend-paying utility stocks, in which the
Fund invests, generated lower returns than the overall index.

INVESTMENT STRATEGY

We invest primarily in two asset classes: high yield bonds and utility stocks.
Within the high yield portion of the portfolio, we use fundamental research to
invest in a diversified portfolio of bonds. Within the utility portion of the
portfolio, we focus on companies with attractive dividend yields and a history
of increasing their dividends.

2. Treasuries, if held to maturity, offer a fixed rate of return and fixed
principal value; their interest payments and principal are guaranteed.

2 | Semiannual Report
<page>

MANAGER'S DISCUSSION

During the six-month reporting period, the returns for the Fund's high yield
bonds and utility stocks were comparable, so the asset weightings did not play a
significant role in the portfolio's overall return.

HIGH YIELD CORPORATE BONDS
Within the portfolio's high yield corporate bonds, the Fund benefited from
relatively aggressive positioning. As signs of economic recovery grew more
pronounced, investors seemed more comfortable with risk, and lower-rated bonds
experienced greater returns than higher-rated bonds within the high yield
spectrum. The Fund began the reporting period with a relatively larger position
in such lower-rated bonds, as we believed they were attractively priced and
could benefit disproportionately from the expected economic recovery.

In addition, the Fund benefited from industry and company credit selection as we
followed our investment strategy. Fund holdings in the cable and satellite
television, transportation, and broadcasting industries boosted returns relative
to the CSFB High Yield Index. 3 For example, the Fund began the period with an
overweighted position in the cable and satellite television sector relative to
the index, and that sector ranked among the top-performing high yield sectors.
In particular, Charter Communications bond prices rose as the company refinanced
debt to extend maturities. Telewest Communications and Century Communications
bonds also appreciated during the period as investors seemed to gain confidence
in these companies' ultimate value. Similarly, the Fund's overweighted
transportation position versus the index contributed to performance, as
companies such as URS (part of industrial services in the SOI) and Laidlaw
International generated positive returns. The broadcasting sector, on the other
hand, generated returns below the index, and the Fund benefited from its
relatively underweighted position.

Conversely, Fund positions in telecommunications, utilities and gaming
constrained returns versus the index. 4 In the case of telecommunications and
utilities, the Fund had lower exposure to those sectors than the index; however,
these sectors outperformed the index for the period, which hindered the Fund's
relative return. We generally limit our high yield utility bond exposure given
the Fund's significant position in utility stocks. Within telecommunications, we
had difficulty finding investment opportunities during the reporting period
largely due to the many defaults over the past several years. Regarding gaming,
the Fund's overweighted position relative to the index hindered relative
performance because the generally higher-quality gaming bonds underperformed the
index during the period.

TOP 10 HOLDINGS
Based on Gross Assets*
2/29/04 vs. 8/31/03

- ---------------------------------------------------
2/29/04
- ---------------------------------------------------
Southern Co. 2.2%
- ---------------------------------------------------
FPL Group Inc. 2.0%
- ---------------------------------------------------
Dominion Resources Inc. 1.9%
- ---------------------------------------------------
United Mexican States 1.7%
- ---------------------------------------------------
IMC Global Inc. 1.6%
- ---------------------------------------------------
Republic of Bulgaria 1.6%
- ---------------------------------------------------
Magellan Health Services Inc. 1.5%
- ---------------------------------------------------
Nicor Inc. 1.5%
- ---------------------------------------------------
Fimep SA 1.5%
- ---------------------------------------------------
Exelon Corp. 1.5%
- ---------------------------------------------------

- ---------------------------------------------------
8/31/03
- ---------------------------------------------------
Southern Co. 2.3%
- ---------------------------------------------------
FPL Group Inc. 2.1%
- ---------------------------------------------------
Dominion Resources Inc. 2.0%
- ---------------------------------------------------
United Mexican States 1.8%
- ---------------------------------------------------
Republic of Bulgaria 1.7%
- ---------------------------------------------------
Gulfterra Energy Partners 1.7%
- ---------------------------------------------------
Hollywood Park 1.6%
- ---------------------------------------------------
Nicor Inc. 1.6%
- ---------------------------------------------------
Legrand SA (Fimep SA) 1.6%
- ---------------------------------------------------
D.R. Horton Inc. 1.5%
- ---------------------------------------------------

*The calculation of percentages is based on total net assets plus the senior
note issued by the Fund.

3. Broadcasting and cable and satellite television are part of consumer services
in the SOI.
4. Telecommunication companies are part of communications in the SOI. Gaming
companies are part of consumer services in the SOI.

Semiannual Report | 3

UTILITY STOCKS

During the six months under review, the Fund's utility exposure was in the lower
half of its normal investment range. Utilities have experienced a remarkable
recovery from the difficulties encountered during 2001 and 2002, which included
the California energy crisis and the Enron bankruptcy. Electric utilities
generally reduced capital spending in non-regulated ventures and focused on
their core, regulated franchises. Largely as a result, many investors' previous
credit concerns related to utilities appeared to dissipate during the reporting
period. Given the industry's recent financial recovery, we believed valuations
of dividend-paying utilities had become expensive, and we found it difficult to
uncover many attractive investments. Within the utility stock portion of the
Fund's portfolio, we focused on those companies with consistent dividends,
quality management and regulated assets.

Thank you for your participation in Franklin Universal Trust. We look forward to
serving you in the future.

Sincerely,

[PHOTO OMITTED]
/S/Christopher J. Molumphy, CFA
Senior Portfolio Manager

[PHOTO OMITTED]
/S/Glenn I. Voyles, CFA
Portfolio Manager

Franklin Universal Trust

THIS DISCUSSION REFLECTS OUR ANALYSIS, OPINIONS AND PORTFOLIO HOLDINGS AS OF
FEBRUARY 29, 2004, THE END OF THE REPORTING PERIOD. THE WAY WE IMPLEMENT OUR
MAIN INVESTMENT STRATEGIES AND THE RESULTING PORTFOLIO HOLDINGS MAY CHANGE
DEPENDING ON FACTORS SUCH AS MARKET AND ECONOMIC CONDITIONS. THESE OPINIONS MAY
NOT BE RELIED UPON AS INVESTMENT ADVICE OR AN OFFER FOR A PARTICULAR SECURITY.
THE INFORMATION IS NOT A COMPLETE ANALYSIS OF EVERY ASPECT OF ANY MARKET,
COUNTRY, INDUSTRY, SECURITY OR THE FUND. STATEMENTS OF FACT ARE FROM SOURCES
CONSIDERED RELIABLE, BUT THE ADVISOR MAKES NO REPRESENTATION OR WARRANTY AS TO
THEIR COMPLETENESS OR ACCURACY. ALTHOUGH HISTORICAL PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS, THESE INSIGHTS MAY HELP YOU UNDERSTAND OUR INVESTMENT
MANAGEMENT PHILOSOPHY.

4 | Semiannual Report
<page>

Performance Summary as of 2/29/04

Your dividend income will vary depending on dividends or interest paid by
securities in the Fund's portfolio, adjusted for operating expenses. Capital
gain distributions are net profits realized from the sale of portfolio
securities. Total return reflects the Fund's dividend income, capital gain
distributions, if any, and any unrealized gains or losses. All total returns
include reinvested distributions according to the terms specified in the Fund's
dividend reinvestment and cash purchase plan and do not reflect any sales
charges paid at inception or brokerage commissions paid on secondary market
purchases.

PRICE AND DISTRIBUTION INFORMATION

- --------------------------------------------------------------------------------
CHANGE 2/29/04 8/31/03
- --------------------------------------------------------------------------------
Net Asset Value (NAV) +$0.80 $6.47 $5.67
- --------------------------------------------------------------------------------
Market Price (NYSE) +$0.67 $5.87 $5.20
- --------------------------------------------------------------------------------
DISTRIBUTIONS (9/1/03-2/29/04)
- --------------------------------------------------------------------------------
Dividend Income $0.1800
- --------------------------------------------------------------------------------

PERFORMANCE

- --------------------------------------------------------------------------------------------------------------------
6-MONTH 1-YEAR 5-YEAR 10-YEAR
- --------------------------------------------------------------------------------------------------------------------

Cumulative Total Return 1
- --------------------------------------------------------------------------------------------------------------------
Based on change in NAV +17.65% +41.60% +17.34% +81.32%
- --------------------------------------------------------------------------------------------------------------------
Based on change in market price +16.44% +19.47% +8.89% +77.21%
- --------------------------------------------------------------------------------------------------------------------
Average Annual Total Return 1
- --------------------------------------------------------------------------------------------------------------------
Based on change in NAV +17.65% +41.60% +3.25% +6.13%
- --------------------------------------------------------------------------------------------------------------------
Based on change in market price +16.44% +19.47% +1.72% +5.89%
- --------------------------------------------------------------------------------------------------------------------
Distribution Rate 2 6.13%
- --------------------------------------------------------------------------------------------------------------------

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE. ONGOING MARKET VOLATILITY
CAN SIGNIFICANTLY AFFECT SHORT-TERM PERFORMANCE; MORE RECENT RETURNS MAY DIFFER
FROM THOSE SHOWN. SINCE MARKETS CAN GO DOWN AS WELL AS UP, INVESTMENT RETURN AND
PRINCIPAL VALUE WILL FLUCTUATE WITH MARKET CONDITIONS, AND YOU MAY HAVE A GAIN
OR LOSS WHEN YOU SELL YOUR SHARES.

FOR MOST RECENT MONTH-END PERFORMANCE, CALL FRANKLIN TEMPLETON INVESTMENTS AT
1-800/342-5236.

ENDNOTES

THE RISKS ASSOCIATED WITH HIGHER-YIELDING, LOWER-RATED SECURITIES INCLUDE HIGHER
RISK OF DEFAULT AND LOSS OF PRINCIPAL. THESE SECURITIES CARRY A GREATER DEGREE
OF CREDIT RISK RELATIVE TO INVESTMENT GRADE SECURITIES. IN ADDITION TO OTHER
FACTORS, SECURITIES ISSUED BY UTILITY COMPANIES ARE PARTICULARLY SENSITIVE TO
INTEREST RATE MOVEMENTS. THE FUND'S SHARE PRICE AND YIELD MAY BE AFFECTED BY
INTEREST RATE MOVEMENTS. SPECIAL RISKS ARE ASSOCIATED WITH FOREIGN INVESTING,
INCLUDING CURRENCY VOLATILITY, ECONOMIC INSTABILITY AND POLITICAL DEVELOPMENTS
OF COUNTRIES WHERE THE FUND INVESTS. EMERGING MARKETS INVOLVE HEIGHTENED RISKS
RELATED TO THE SAME FACTORS, IN ADDITION TO THOSE ASSOCIATED WITH THEIR
RELATIVELY SMALL SIZE AND LESSER LIQUIDITY.

1. Total return calculations represent the cumulative and average annual changes
in value of an investment over the periods indicated. Six-month return has not
been annualized.
2. Distribution rate is based on an annualization of the Fund's 3.0 cent per
share February dividend and the NYSE closing price of $5.87 on 2/29/04.

Semiannual Report | Past performance does not guarantee future results. | 5

Annual Shareholders' Meeting

FEBRUARY 24, 2004

At an Annual Shareholders' Meeting of Franklin Universal Trust (the "Fund") held
on February 24, 2004, shareholders approved the following:

1. Regarding the election of a Board of Trustees of the Fund.

- --------------------------------------------------------------------------------
TRUSTEES SHARES FOR WITHHELD OR ABSTAIN
- --------------------------------------------------------------------------------
Harris J. Ashton 24,184,212.961 251,521.002
- --------------------------------------------------------------------------------
Robert F. Carlson 24,175,334.814 260,399.149
- --------------------------------------------------------------------------------
S. Joseph Fortunato 24,210,089.757 225,644.206
- --------------------------------------------------------------------------------
Edith E. Holiday 24,187,618.961 248,115.002
- --------------------------------------------------------------------------------
Edward B. Jamieson 24,196,282.709 239,451.255
- --------------------------------------------------------------------------------
Charles B. Johnson 24,188,589.814 247,144.149
- --------------------------------------------------------------------------------
Rupert H. Johnson, Jr. 24,196,960.709 238,773.255
- --------------------------------------------------------------------------------
Frank W.T. LaHaye 24,175,151.814 260,582.149
- --------------------------------------------------------------------------------
Gordon S. Macklin 24,171,142.814 264,591.149
- --------------------------------------------------------------------------------

6 | Semiannual Report
<page>

Dividend Reinvestment and Cash Purchase Plan

The Fund's Dividend Reinvestment and Cash Purchase Plan (the "Plan") offers you
a prompt and simple way to reinvest dividends and capital gain distributions in
shares of the Fund. The Plan also allows you to purchase additional shares of
the Fund by making voluntary cash payments. PFPC Inc. (the "Plan Agent"), P.O.
Box 9223, Chelsea, MA 02150-9223, acts as your Plan Agent in administering the
Plan. The complete Terms and Conditions of the Dividend Reinvestment and Cash
Purchase Plan are contained in the Fund's Dividend Reinvestment and Cash
Purchase Plan Brochure. A copy of that Brochure may be obtained from the Fund at
the address on the back cover of this report.

You are automatically enrolled in the Plan unless you elect to receive dividends
or distributions in cash. If you own shares in your own name, you should notify
the Plan Agent, in writing, if you wish to receive dividends or distributions in
cash.

If the Fund declares a dividend or capital gain distribution payable either in
cash or in stock of the Fund and the market price of shares on the valuation
date equals or exceeds the net asset value, the Fund will issue new shares to
you at the higher of net asset value or 95% of the then current market price. If
the market price is lower than net asset value and if dividends or capital gain
distributions are payable only in cash, then you will receive shares purchased
on the New York Stock Exchange or otherwise on the open market. If the price
exceeds the net asset value before the Plan Agent has completed its purchases,
the average purchase price may exceed the net asset value, resulting in fewer
shares being acquired than if the Fund had issued new shares. All reinvestments
are in full and fractional shares, carried to three decimal places. The Fund
will not issue shares under the Plan at a price below net asset value.

The Plan permits you on a voluntary basis to submit in cash payments of not less
than $100 each up to a total of $5,000 per month to purchase additional shares
of the Fund. It is entirely up to you whether you wish to buy additional shares
with voluntary cash payments, and you do not have to send in the same amount
each time if you do. These payments should be made by check or money order
payable to PFPC Inc. and sent to PFPC Inc., Attn: Franklin Universal Trust, P.O.
Box 9223, Chelsea, MA 02150-9223.

Your cash payment will be aggregated with the payments of other participants and
invested on your behalf by the Plan Agent in shares of the Fund which are
purchased in the open market.

Semiannual Report | 7

The Plan Agent will invest cash payments on approximately the 5th of each month
in which no dividend or distribution is payable and, during each month in which
a dividend or distribution is payable, will invest cash payments beginning on
the dividend payment date. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON YOUR
FUNDS HELD BY THE PLAN AGENT. Accordingly, you should send any voluntary cash
payments which you wish to make shortly before an investment date but in
sufficient time to ensure that your payment will reach the Plan Agent not less
than two business days before an investment date. Payments received less than
two business days before an investment date will be invested during the next
month or, if there are more than 30 days until the next investment date, will be
returned to you. You may obtain a refund of any cash payment by written notice,
if the Plan Agent receives the written notice not less than 48 hours before an
investment date.

There is no direct charge to participants for reinvesting dividends and capital
gain distributions, since the Plan Agent's fees are paid by the Fund. However,
when shares are purchased in the open market, each participant will pay a pro
rata portion of any brokerage commissions incurred. The Plan Agent will deduct a
$5.00 service fee from each of your voluntary cash payments.

The automatic reinvestment of dividends and capital gain distributions does not
relieve you of any taxes which may be payable on dividends or distributions. In
connection with the reinvestment of dividends and capital gain distributions, if
the Fund issues new shares, shareholders receiving such shares generally will be
treated as having a distribution equal to the market value of the shares
received, and if shares are purchased on the open market, shareholders generally
will be treated as having received a distribution equal to the cash distribution
that would have been paid.

The Fund does not issue new shares in connection with voluntary cash payments.
All investments are in full and fractional shares, carried to three decimal
places. If the market price exceeds the net asset value at the time the Plan
Agent purchases the additional shares, you will receive shares at a price
greater than the net asset value.

You will receive a monthly account statement from the Plan Agent showing total
dividends and capital gain distributions, date of investment, shares acquired
and price per share, and total shares of record held by you and by the Plan
Agent for you. You are entitled to vote all shares of record, including shares
purchased for you by the Plan Agent, and, if you vote by proxy, your proxy will
include all such shares.

As long as you participate in the Plan, the Plan Agent will hold the shares it
has acquired for you in safekeeping, in its name or in the name of its nominee.
This convenience provides added protection against loss, theft or inadvertent
destruction of certificates. However, you may request that a certificate
representing your Plan shares be issued to you.

8 | Semiannual Report
<page>

You may withdraw from the Plan without penalty at any time by notifying the Plan
Agent, in writing, at the address above. If you withdraw, you will receive,
without charge, stock certificates issued in your name for all full shares. The
Plan Agent will convert any fractional shares you hold at the time of your
withdrawal to cash at current market price and send you a check for the
proceeds.

If you hold shares in your own name, please address all notices, correspondence,
questions, or other communications regarding the Plan to the Plan Agent at the
address noted above. If your shares are not held in your name, you should
contact your brokerage firm, bank, or other nominee for more information and to
determine if your nominee will participate in the Plan on your behalf.

The Fund or the Plan Agent may amend or terminate the Plan. You will receive
written notice at least 90 days before the effective date of termination or of
any amendment. In the case of termination, you will receive written notice at
least 90 days before the record date of any dividend or capital gain
distribution by the Fund.

Semiannual Report | 9

Franklin Universal Trust

FINANCIAL HIGHLIGHTS

---------------------------------------------------------------------------
SIX MONTHS ENDED
FEBRUARY 29, 2004 YEAR ENDED AUGUST 31,
(UNAUDITED) 2003 2002 2001 2000 1999
---------------------------------------------------------------------------

PER SHARE OPERATING PERFORMANCE
(for a share outstanding throughout the period)
Net asset value, beginning of period ............. $5.67 $5.13 $7.32 $8.21 $ 8.91 $ 9.28
---------------------------------------------------------------------------
Income from investment operations:
Net investment income a ......................... .23 .45 .65 d .73 .81 .82
Net realized and unrealized gains (losses) ...... .75 .59 (2.05) d (.82) (.65) (.35)
---------------------------------------------------------------------------
Total from investment operations ................. .98 1.04 (1.40) (.09) .16 .47
---------------------------------------------------------------------------
Less distributions from:
Net investment income ........................... (.18) (.50) (.79) (.80) (.80) (.84)
Net realized gains .............................. -- -- -- -- (.06) --
---------------------------------------------------------------------------
Total distributions .............................. (.18) (.50) (.79) (.80) (.86) (.84)
---------------------------------------------------------------------------
Net asset value, end of period ................... $6.47 $5.67 $5.13 $7.32 $ 8.21 $ 8.91
===========================================================================
Market value, end of period b .................... $5.87 $5.20 $6.37 $8.24 $7.688 $8.688
===========================================================================

Total return (based on market value
per share) ...................................... 16.44% (10.13)% (13.68)% 19.01% (.40)% 2.95%

RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's) ................ $180,587 $158,364 $141,619 $198,598 $220,742 $239,537
Ratios to average net assets:
Expenses ........................................ 2.52% c 3.59% 4.05% 3.29% 3.15% 2.92%
Net investment income ........................... 7.47% c 8.68% 10.04% d 9.38% 9.92% 8.86%
Portfolio turnover rate .......................... 14.94% 65.15% 17.38% 31.60% 29.59% 31.62%
Total debt outstanding at end of
period (000's) ................................... $ 55,000 $ 55,000 $ 60,000 $ 75,000 $ 75,000 $ 75,000
Asset coverage per $1,000 of debt ................ $ 4,283 $ 3,879 $ 3,360 $ 3,648 $ 3,948 $ 4,194
Average amount of Note per share during the
period .......................................... $1.97 $1.87 $2.65 $2.76 $2.79 $2.79

aBased on average daily shares outstanding.
bBased on the last sale on the New York Stock Exchange.
cAnnualized.
dEffective September 1, 2001, the Fund adopted the provisions of the AICPA Audit
and Accounting Guide for Investment Companies and began amortizing all premium
and discount on fixed-income securities, as required. The effect of this change
was as follows:

Net investment income per share ..................................... $(.012)
Net realized and unrealized gains (losses) per share ................ .012
Ratio of net investment income to average net assets ................ (.19)%

Per share data and ratios for prior periods have not been restated to reflect
this change in accounting policy.

10 | See notes to financial statements. | Semiannual Report
<page>

Franklin Universal Trust

STATEMENT OF INVESTMENTS, FEBRUARY 29, 2004 (UNAUDITED)

- ----------------------------------------------------------------------------------------------------------------------------------
COUNTRY SHARES/WARRANTS VALUE
- ----------------------------------------------------------------------------------------------------------------------------------

COMMON STOCKS AND WARRANTS 33.0%
COMMUNICATIONS 2.1%
BellSouth Corp. .................................................... United States 76,000 $ 2,094,560
a Call-Net Enterprises Inc., B ....................................... Canada 41,958 136,363
a Metrocall Holdings Inc. ............................................ United States 17,540 1,276,035
a,b Poland Telecom Finance, wts., 144A,
12/01/07 ......................................................... Poland 3,000 --
Vodafone Group PLC, ADR ............................................ United Kingdom 10,400 259,688
a XO Communications Inc., wts., A, 1/16/10 ........................... United States 7,800 25,039
a XO Communications Inc., wts., B, 1/16/10 ........................... United States 5,850 14,625
a XO Communications Inc., wts., C, 1/16/10 ........................... United States 5,850 11,378
a XO Communications Inc. ............................................. United States 3,901 25,159
-------------
3,842,847
-------------
ELECTRONIC TECHNOLOGY
a Loral Space & Communications Ltd., wts., 12/27/06 .................. United States 21,638 --
a Loral Space & Communications Ltd., wts., 1/15/07 ................... United States 5,000 50
-------------
50
-------------
ENERGY MINERALS .1%
Devon Energy Corp. ................................................. United States 3,285 186,522
a McMoRan Exploration Co. ............................................ United States 1,800 27,000
-------------
213,522
-------------
HEALTH SERVICES 2.0%
a Magellan Health Services Inc. ...................................... United States 131,320 3,545,640
-------------
NON-ENERGY MINERALS 1.2%
AngloGold Ltd., ADR ................................................ South Africa 30,446 1,307,656
Barrick Gold Corp. ................................................. Canada 35,800 732,110
-------------
2,039,766
-------------
PRODUCER MANUFACTURING
a Harvard Industries Inc. ............................................ United States 109,618 548
a VS Holdings ........................................................ United States 181,875 11,367
-------------
11,915
-------------
TRANSPORTATION
a Continental Airlines Inc., B ....................................... United States 2,500 36,625
-------------
UTILITIES 27.6%
Alliant Energy Corp. ............................................... United States 95,000 2,446,250
Ameren Corp. ....................................................... United States 40,000 1,896,000
American Electric Power Co. Inc. ................................... United States 30,000 1,035,000
Atmos Energy Corp. ................................................. United States 85,000 2,239,750
CenterPoint Energy Inc. ............................................ United States 60,000 627,600
Cinergy Corp. ...................................................... United States 55,000 2,155,450
Dominion Resources Inc. ............................................ United States 70,000 4,398,100
DTE Energy Co. ..................................................... United States 45,000 1,820,700
Edison International ............................................... United States 35,000 808,150

Semiannual Report | 11

Franklin Universal Trust

STATEMENT OF INVESTMENTS, FEBRUARY 29, 2004 (UNAUDITED) (CONTINUED)

COMMON STOCKS AND WARRANTS (CONT.)
UTILITIES (CONT.)
Energy East Corp. .................................................. United States 42,000 $ 1,014,720
Entergy Corp. ...................................................... United States 28,000 1,660,120
Exelon Corp. ....................................................... United States 52,000 3,491,280
FirstEnergy Corp. .................................................. United States 75,000 2,897,250
FPL Group Inc. ..................................................... United States 70,000 4,595,500
Nicor Inc. ......................................................... United States 98,000 3,541,720
NiSource Inc. ...................................................... United States 36,000 781,560
ONEOK Inc. ......................................................... United States 22,600 501,946
Pepco Holdings Inc. ................................................ United States 68,000 1,445,000
Pinnacle West Capital Corp. ........................................ United States 76,000 2,970,840
Progress Energy Inc. ............................................... United States 70,000 3,231,200
Southern Co. ....................................................... United States 170,000 5,154,400
TXU Corp. .......................................................... United States 39,600 1,113,948
-------------
49,826,484
-------------
TOTAL COMMON STOCKS AND WARRANTS (COST $53,693,917) ................ 59,516,849
-------------
PREFERRED STOCKS .1%
COMMUNICATIONS
Metrocall Holdings Inc., 15.00%, pfd., A ........................... United States 1,213 15,448
-------------
PROCESS INDUSTRIES .1%
a Asia Pulp & Paper Co. Ltd., 12.00%, pfd. ........................... United States 4,000,000 80,000
-------------
TOTAL PREFERRED STOCKS (COST $4,002,608) ........................... 95,448
-------------
CONVERTIBLE PREFERRED STOCK (COST $1,700,803) 1.2%
CONSUMER DURABLES
Ford Motor Co. Capital Trust II, 6.50%, cvt. pfd. .................. United States 40,800 2,176,680
-------------

------------------
PRINCIPAL AMOUNT f
------------------
BONDS 93.4%
COMMERCIAL SERVICES .1%
c Key3Media Group Inc., senior sub. note, 11.25%,
6/15/11 .......................................................... United States $ 5,000,000 125,000
-------------
COMMUNICATIONS 8.6%
Centennial Communications Corp., senior note, 144A, 8.125%,
2/01/14 .......................................................... United States 1,500,000 1,417,500
Dobson Communications Corp., senior note, 8.875%,
10/01/13 ......................................................... United States 1,900,000 1,643,500
Millicom International Cellular SA, senior note, 144A, 10.00%,
12/01/13 ......................................................... Luxembourg 2,300,000 2,449,500
Nextel Communications Inc., senior note, 7.375%,
8/01/15 .......................................................... United States 3,000,000 3,247,500
c Poland Telecom Finance B, 14.00%, 12/01/07 ......................... Poland 3,000,000 300
Time Warner Telecom Holdings, senior note, 144A,
9.25%, 2/15/14 ................................................... United States 1,300,000 1,300,000
Time Warner Telecom Inc., senior note, 10.125%,
2/01/11 .......................................................... United States 1,700,000 1,606,500
Triton PCS Inc., senior note, 8.50%, 6/01/13 ....................... United States 1,300,000 1,436,500
US West Communications Inc., 6.875%, 9/15/33 ....................... United States 2,800,000 2,492,000
-------------
15,593,300
-------------

12 | Semiannual Report
<page>

Franklin Universal Trust

STATEMENT OF INVESTMENTS, FEBRUARY 29, 2004 (UNAUDITED) (CONTINUED)

- ----------------------------------------------------------------------------------------------------------------------------------
COUNTRY PRINCIPAL AMOUNT f VALUE
- ----------------------------------------------------------------------------------------------------------------------------------

BONDS (CONT.)
CONSUMER DURABLES 4.1%
D.R. Horton Inc., senior note, 8.50%, 4/15/12 ...................... United States $ 3,000,000 $ 3,427,500
General Motors, 8.25%, 7/15/23 ..................................... United States 1,800,000 2,018,873
Simmons Co., senior sub. note, 144A, 7.875%, 1/15/14 ............... United States 1,900,000 1,923,750
-------------
7,370,123
-------------
CONSUMER NON-DURABLES .6%
Smithfield Foods Inc., senior note, 7.75%, 5/15/13 ................. United States 1,000,000 1,080,000
-------------
CONSUMER SERVICES 24.3%
b,c Atherton Franchise Capital, LP, 13.073%,
12/01/08 ......................................................... United States 765,361 267,876
CanWest Media Inc., senior sub. note, 10.625%,
5/15/11 .......................................................... Canada 2,100,000 2,388,750
c Century Communications Corp., senior disc. note, B, zero cpn.,
1/15/08 .......................................................... United States 5,000,000 3,300,000
Charter Communications Holdings II, senior note, 144A, 10.25%,
9/15/10 .......................................................... United States 2,500,000 2,612,500
Corrections Corp. of America, senior note, 7.50%,
5/01/11 .......................................................... United States 2,300,000 2,432,250
Dex Media West LLC, senior sub. note, 144A, 9.875%,
8/15/13 .......................................................... United States 2,400,000 2,706,000
Diamond Holdings PLC, senior note, 9.125%, 2/01/08 ................. United Kingdom 2,000,000 2,072,500
DIRECTV Holdings/Finance, senior note, 8.375%,
3/15/13 .......................................................... United States 2,000,000 2,285,000
EchoStar DBS Corp., senior note, 10.375%, 10/01/07 ................. United States 2,500,000 2,746,875
Hollywood Park, senior sub. note, B, 9.25%, 2/15/07 ................ United States 3,300,000 3,423,750
Nexstar Finance Inc., senior sub. note, 144A, 7.00%,
1/15/14 .......................................................... United States 3,000,000 2,992,500
Park Place Entertainment Corp., senior sub. note,
7.875%, 3/15/10 .................................................. United States 2,400,000 2,676,000
Premier Entertainment Biloxi Finance, 144A, 10.75%,
2/01/12 .......................................................... United States 400,000 430,000
Royal Caribbean Cruises Ltd., senior note, 6.875%,
12/01/13 ......................................................... United States 1,800,000 1,876,500
Royal Caribbean Cruises Ltd., senior note, 8.00%,
5/15/10 .......................................................... United States 1,200,000 1,347,000
Six Flags Inc., senior note, 9.50%, 2/01/09 ........................ United States 3,000,000 3,157,500
Station Casinos, 6.875%, 3/01/16 ................................... United States 2,200,000 2,233,000
Station Casinos, senior sub. note, 144A, 6.50%,
2/01/14 .......................................................... United States 800,000 812,000
Telewest Communications PLC, senior disc. note, zero cpn. to 4/15/04,
9.25% thereafter, 4/15/09 ........................................ United Kingdom 1,500,000 821,250
Telewest Communications PLC, senior disc. note, zero cpn. to 2/01/05,
11.375% thereafter, 2/01/10 ...................................... United Kingdom 3,500,000 1,741,250
Young Broadcasting Inc., senior sub. note, 144A,
8.75%, 1/15/14 ................................................... United States 1,500,000 1,560,000
-------------
43,882,501
-------------
DISTRIBUTION SERVICES
c AmeriServe Food Distribution Inc., senior note, 8.875%,
10/15/06 ......................................................... United States 1,000,000 --
c AmeriServe Food Distribution Inc., senior sub. note,
10.125%, 7/15/07 ................................................. United States 2,700,000 --
-------------
--
-------------
ELECTRONIC TECHNOLOGY 6.9%
Communications & Power Industries, senior sub. note, 8.00%,
2/01/12 .......................................................... United States 2,700,000 2,754,000
Flextronics International Ltd., senior sub. note,
6.50%, 5/15/13 ................................................... Singapore 2,500,000 2,603,125
Inmarsat Finance PLC, senior note, 144A, 7.625%,
6/30/12 .......................................................... United Kingdom 1,100,000 1,160,500
d Invensys PLC, 144A, 9.875%, 3/15/11 ................................ United Kingdom 1,800,000 1,766,646

Semiannual Report | 13

Franklin Universal Trust

STATEMENT OF INVESTMENTS, FEBRUARY 29, 2004 (UNAUDITED) (CONTINUED)

BONDS (CONT.)
ELECTRONIC TECHNOLOGY (CONT.)
New Asat Finance Ltd., senior note, 144A, 9.25%,
2/01/11 .......................................................... United States $ 2,500,000 $ 2,681,250
Vought Aircraft Industries, senior note, 144A, Inc.,
8.00%, 7/15/11 ................................................... United States 1,500,000 1,560,000
-------------
12,525,521
-------------
ENERGY MINERALS 3.0%
Arch Western Finance, senior note, 144A, 6.75%, 7/01/13 ............ United States 2,000,000 2,120,000
Vintage Petroleum, senior sub. note, 7.875%, 5/15/11 ............... United States 3,000,000 3,210,000
-------------
5,330,000
-------------
GOVERNMENT BONDS 5.4%
ESKOM, 11.00%, 6/01/08 ............................................. South Africa 4,350,000 ZAR 680,147
Federation of Russia, 3.00%, 5/14/06 ............................... Russia 1,300,000 1,270,750
Republic of Bulgaria, FRN, 7/28/11 ................................. Bulgaria 3,760,000 3,705,950
United Mexican States, 11.375%, 9/15/16 ............................ Mexico 2,750,000 4,077,563
-------------
9,734,410
-------------
HEALTH SERVICES 1.0%
Tenet Healthcare Corp., senior note, 7.375%, 2/01/13 ............... United States 2,000,000 1,860,000
-------------
INDUSTRIAL SERVICES 7.3%
Allied Waste North America Inc., senior secured note, 144A, 6.50%,
11/15/10 ......................................................... United States 3,000,000 3,060,000
Grant Prideco Escrow, senior note, 9.00%, 12/15/09 ................. United States 1,000,000 1,125,000
Gulfterra Energy Partners, senior sub. note, 10.625%,
12/01/12 ......................................................... United States 2,009,000 2,491,160
Hanover Equipment Trust 01, senior secured note, B, 8.75%,
9/01/11 .......................................................... United States 3,000,000 3,240,000
URS Corp., senior sub. note, 12.25%, 5/01/09 ....................... United States 3,000,000 3,225,000
-------------
13,141,160
-------------
PROCESS INDUSTRIES 13.0%
Applied Extrusion Technologies Inc., senior note,
10.75%, 7/01/11 .................................................. United States 900,000 769,500
Avecia Group PLC, senior note, 11.00%, 7/01/09 ..................... United Kingdom 1,100,000 946,000
Consolidated Container Co. LLC, senior sub. note,
10.125%, 7/15/09 ................................................. United States 1,600,000 1,144,000
Equistar Chemicals LP, senior note, 10.625%, 5/01/11 ............... United States 1,700,000 1,853,000
FiberMark Inc., senior note, 10.75%, 4/15/11 ....................... United States 3,000,000 1,995,000
Georgia-Pacific Corp., senior note, 144A, 8.00%,
1/15/24 .......................................................... United States 3,000,000 3,067,500
Graham Packaging Co., senior sub. note, 144A,
8.75%, 1/15/08 ................................................... United States 2,100,000 2,131,500
Graham Packaging Co., senior sub. note, B, 8.75%,
1/15/08 .......................................................... United States 600,000 609,000
Huntsman ICI Holdings LLC, senior disc. note, zero cpn.,
12/31/09 ......................................................... United States 6,000,000 2,880,000
IMC Global Inc., senior note, 144A, 10.875%, 8/01/13 ............... United States 3,000,000 3,735,000
Kraton Polymers LLC/CAP, senior sub. note, 144A,
8.125%, 1/15/14 .................................................. United States 600,000 640,500
Nalco Co., senior sub. note, 144A, 8.875%, 11/15/13 ................ United States 1,500,000 1,582,500
c Pindo Deli Finance Mauritius Ltd., senior note,
11.75%, 10/01/17 ................................................. Singapore 3,000,000 750,000
United Industries Corp., senior sub. note, 9.875%,
4/01/09 .......................................................... United States 1,300,000 1,361,750
-------------
23,465,250
-------------

14 | Semiannual Report
<page>

Franklin Universal Trust

STATEMENT OF INVESTMENTS, FEBRUARY 29, 2004 (UNAUDITED) (CONTINUED)

BONDS (CONT.)
PRODUCER MANUFACTURING 8.0%
Case New Holland Inc., senior note, 144A, 9.25%,
8/01/11 .......................................................... United States $ 3,000,000 $ 3,390,000
Fimep SA, senior note, 10.50%, 2/15/13 ............................. France 3,000,000 3,540,000
NMHG Holding Co., senior note, 10.00%, 5/15/09 ..................... United States 1,800,000 1,989,000
Norcraft Cos. LP, senior sub. note, 144A, 9.00%,
11/01/11 ......................................................... United States 1,100,000 1,166,000
TRW Automotive Inc., senior note, 9.375%, 2/15/13 .................. United States 1,900,000 2,175,500
TRW Automotive Inc., senior sub. note, 11.00%,
2/15/13 .......................................................... United States 300,000 354,000
Westinghouse Air Brake, senior note, 6.875%, 7/31/13 ............... United States 1,700,000 1,802,000
-------------
14,416,500
-------------
REAL ESTATE INVESTMENT TRUSTS 2.6%
Host Marriott LP, 9.50%, 1/15/07 ................................... United States 2,500,000 2,781,250
Ventas Realty LP/Capital Corp., senior note, 9.00%,
5/01/12 .......................................................... United States 1,700,000 1,942,250
-------------
4,723,500
-------------
RETAIL TRADE 1.6%
Rite Aid Corp., senior note, 144A, 6.125%, 12/15/08 ................ United States 3,000,000 2,880,000
-------------
TECHNOLOGY SERVICES .1%
c PSINet Inc., 10.50%, 12/01/06 ...................................... United States 700,000 40,250
c PSINet Inc., 11.00%, 8/01/09 ....................................... United States 3,250,000 186,875
-------------
227,125
-------------
TRANSPORTATION 2.1%
Great Lakes Dredge & Dock, senior sub. note, 144A, 7.75%,
12/15/13 ......................................................... United States 400,000 420,000
Laidlaw International Inc., senior note, 144A, 10.75%,
6/15/11 .......................................................... United States 3,000,000 3,457,500
-------------
3,877,500
-------------
UTILITIES 4.7%
AES Corp., senior note, 9.375%, 9/15/10 ............................ United States 2,600,000 2,853,500
Calpine Corp., senior secured note, 144A, 8.75%,
7/15/13 .......................................................... United States 2,500,000 2,312,500
Dynegy Holdings Inc., senior note, 8.75%, 2/15/12 .................. United States 2,600,000 2,496,000
PG&E Corp., senior secured note, 144A, 6.875%,
7/15/08 .......................................................... United States 800,000 864,000
-------------
8,526,000
-------------
TOTAL BONDS (COST $177,628,934) .................................... 168,757,890
-------------
CONVERTIBLE BONDS 1.4%
Millicom International Cellular SA 2.00%, cvt., PIK, senior note, 144A,
6/01/06 .......................................................... Luxembourg 41,000 310,780
Nortel Networks Corp., senior note, cvt., 4.25%,
9/01/08 .......................................................... Canada 2,100,000 2,291,624
-------------
TOTAL CONVERTIBLE BONDS (COST $1,689,308) .......................... 2,602,404
-------------
TOTAL LONG TERM INVESTMENTS (COST $238,715,570) .................... 233,149,271
-------------

Semiannual Report | 15

Franklin Universal Trust

STATEMENT OF INVESTMENTS, FEBRUARY 29, 2004 (UNAUDITED) (CONTINUED)

- ----------------------------------------------------------------------------------------------------------------------------------
COUNTRY SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------------------------

SHORT TERM INVESTMENTS (COST $419,280) .2%

e Franklin Institutional Fiduciary Trust Money Market
Portfolio ........................................................ United States 419,280 $ 419,280
-------------
TOTAL INVESTMENTS (COST $239,134,850) 129.3% ....................... 233,568,551
OTHER ASSETS, LESS LIABILITIES (29.3)% ............................. (52,981,954)
-------------
NET ASSETS 100.0% .................................................. $180,586,597
=============

CURRENCY ABBREVIATIONS ZAR - South African Rand

aNon-income producing.
bSee Note 9 regarding restricted securities.
cThe fund discontinues accruing income on defaulted securities. See Note 8.
dSee Note 1(c) regarding securities purchased on a when-issued or delayed
delivery basis.
eSee Note 7 regarding investments in the Franklin Institutional Fiduciary Trust
Money Market Portfolio.
fThe principal amount is stated in U.S. dollars unless otherwise indicated.

16 | See notes to financial statements. | Semiannual Report
<page>

Franklin Universal Trust

FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES
February 29, 2004 (unaudited)

Assets:
Investments in securities:
Cost ..................................................................................... $ 239,134,850
==============
Value .................................................................................... 233,568,551
Receivables:
Investment securities sold ............................................................... 1,409,055
Dividends and interest ................................................................... 3,240,114
Note issuance costs (Note 3) .............................................................. 181,828
--------------
Total assets ......................................................................... 238,399,548
--------------
Liabilities:
Payables:
Investment securities purchased .......................................................... 1,766,646
Affiliates ............................................................................... 146,678
Note (Note 3) ............................................................................ 55,000,000
Distributions to shareholders ............................................................. 837,728
Other liabilities ......................................................................... 61,899
--------------
Total liabilities .................................................................... 57,812,951
--------------
Net assets, at value ................................................................ $180,586,597
==============
Net assets consist of:
Undistributed net investment income ....................................................... $ (279,754)
Net unrealized appreciation (depreciation) ................................................ (5,566,077)
Accumulated net realized gain (loss) ...................................................... (68,382,997)
Capital shares ............................................................................ 254,815,425
--------------
Net assets, at value ................................................................ $180,586,597
==============
Net asset value per share ($180,586,597 / 27,924,294 shares outstanding) ................... $6.47
==============

Semiannual Report | See notes to financial statements. | 17

Franklin Universal Trust

FINANCIAL STATEMENTS (CONTINUED)

STATEMENT OF OPERATIONS
for the six months ended February 29, 2004 (unaudited)

Investment income:
Dividends ............................................................................. $ 1,199,435
Interest .............................................................................. 7,379,885
------------
Total investment income .......................................................... 8,579,320
------------
Expenses:
Management fees (Note 4) .............................................................. 848,940
Transfer agent fees ................................................................... 44,780
Custodian fees ........................................................................ 3,573
Reports to shareholders ............................................................... 22,707
Professional fees ..................................................................... 52,238
Trustees' fees and expenses ........................................................... 13,283
Amortization of note issuance costs (Note 3) .......................................... 18,172
Other ................................................................................. 21,476
------------
Expenses before interest expense ................................................. 1,025,169
Interest expense (Note 3) ........................................................ 1,138,500
------------
Total expenses .................................................................. 2,163,669
------------
Net investment income .......................................................... 6,415,651
------------
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments .......................................................................... (6,576,026)
Foreign currency transactions ........................................................ 4,564
------------
Net realized gain (loss) ........................................................ (6,571,462)
Net unrealized appreciation (depreciation) on:
Investments .......................................................................... 27,405,287
Translation of assets and liabilities denominated in foreign currencies .............. (338)
------------
Net unrealized appreciation (depreciation) ...................................... 27,404,949
------------
Net realized and unrealized gain (loss) ................................................ 20,833,487
------------
Net increase (decrease) in net assets resulting from operations ........................ $27,249,138
============

18 | See notes to financial statements. | Semiannual Report
<page>

Franklin Universal Trust

FINANCIAL STATEMENTS (CONTINUED)

STATEMENTS OF CHANGES IN NET ASSETS for the six months ended February 29, 2004
(unaudited) and the year ended August 31, 2003

----------------------------------------
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 2004 AUGUST 31, 2003
----------------------------------------

Increase (decrease) in net assets:
Operations:
Net investment income ............................................................. $ 6,415,651 $ 12,490,828
Net realized gain (loss) from investments and foreign currency transactions ....... (6,571,462) (21,440,868)
Net unrealized appreciation (depreciation) on investments and translation of
assets and liabilities denominated in foreign currencies ......................... 27,404,949 37,996,861
----------------------------------------
Net increase (decrease) in net assets resulting from operations ............... 27,249,138 29,046,821
Distributions to shareholders from net investment income ........................... (5,026,373) (13,869,575)
Capital share transactions (Note 2) ................................................ -- 1,567,138
----------------------------------------
Net increase (decrease) in net assets ......................................... 22,222,765 16,744,384
Net assets:
Beginning of period ................................................................ 158,363,832 141,619,448
----------------------------------------
End of period ...................................................................... $180,586,597 $158,363,832
========================================
Undistributed net investment income included in net assets:
End of period ...................................................................... $ (279,754) $ (1,669,032)
========================================

Semiannual Report | See notes to financial statements. | 19

Franklin Universal Trust

FINANCIAL STATEMENTS (CONTINUED)

STATEMENT OF CASH FLOWS
For the six months ended February 29, 2004 (unaudited)

Cash flow from operating activities:
Dividends and interest received ........................................................................... $ 7,390,831
Operating expenses paid ................................................................................... (996,537)
Interest expense paid ..................................................................................... (1,138,500)
-------------
Cash provided - operations ............................................................................... 5,255,794
=============
Cash flow from investing activities:
Investment purchases ...................................................................................... (83,319,996)
Investment sales and maturities ........................................................................... 84,177,977
-------------
Cash provided - investments .............................................................................. 857,981
=============
Cash flow from financing activities:
Distributions to shareholders ............................................................................. (4,830,904)
-------------
Cash used - financing activities ......................................................................... (4,830,904)
=============
Net increase (decrease) in cash ............................................................................ 1,282,871
Cash at beginning of period ................................................................................ (1,282,871)
-------------
Cash at end of period ...................................................................................... $ --
=============

RECONCILIATION OF NET INVESTMENT INCOME TO NET CASH PROVIDED BY OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 29, 2004

Net investment income ...................................................................................... $ 6,415,651
Adjustments to reconcile net investment income to net cash provided by operating activities:
Amortization income ...................................................................................... (981,635)
Amortization of note issuance costs ...................................................................... 18,172
Increase in dividends and interest receivable ............................................................ (206,854)
Decrease in other liabilities ............................................................................ 10,460
-------------
Net cash provided by operating activities .................................................................. $ 5,255,794
=============

20 | See notes to financial statements. | Semiannual Report
<page>

Franklin Universal Trust

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Franklin Universal Trust (the Fund) is registered under the Investment Company
Act of 1940 as a diversified, closed-end investment company. The Fund has two
classes of securities: senior fixed-rate note (the Note) and shares of
beneficial interest (the Shares). The Fund seeks high current income consistent
with preservation of capital. The following summarizes the Fund's significant
accounting policies.

A. SECURITY VALUATION

Securities listed or traded on a recognized national exchange or NASDAQ are
valued at the last reported sales price. Over-the-counter securities and listed
securities for which no sale is reported are valued within the range of the
latest quoted bid and asked prices. Investments in open-end mutual funds are
valued at the closing net asset value. Foreign securities are valued at the
close of trading of the foreign exchange or the NYSE, whichever is earlier. If
events occur that materially affect the values of securities after the prices or
foreign exchange rates are determined, or if the market quotations are not
readily available, the securities including restricted securities will be valued
at fair value as determined following procedures approved by the Board of
Trustees.

B. FOREIGN CURRENCY TRANSLATION

Portfolio securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollars based on the exchange rate of such
currencies against U.S. dollars on the date of valuation. Purchases and sales of
securities and income items denominated in foreign currencies are translated
into U.S. dollars at the exchange rate in effect on the transaction date.

The Fund does not separately report the effect of changes in foreign exchange
rates from changes in market prices on securities held. Such changes are
included in net realized and unrealized gain or loss from investments.

Realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on securities transactions and the difference between the recorded amounts
of dividends, interest, and foreign withholding taxes and the U.S. dollars
equivalent of the amounts actually received or paid. Net unrealized foreign
exchange gains and losses arise from changes in foreign exchange rates on
foreign denominated assets and liabilities other than investments in securities
held at the end of the reporting period.

C. SECURITIES PURCHASED ON A WHEN-ISSUED OR DELAYED DELIVERY BASIS

The Fund may purchase securities on a when-issued or delayed delivery basis,
with payment and delivery scheduled for a future date. These transactions are
subject to market fluctuations and are subject to the risk that the value at
delivery may be more or less than the trade date purchase price. Although the
Fund will generally purchase these securities with the intention of holding the
securities, it may sell the securities before the settlement date. Sufficient
assets have been segregated for these securities.

Semiannual Report | 21

Franklin Universal Trust

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

D. INCOME TAXES

No provision has been made for income taxes because the Fund's policy is to
qualify as a regulated investment company under the Internal Revenue Code and to
distribute substantially all of its taxable income.

E. SECURITY TRANSACTIONS, INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS

Security transactions are accounted for on trade date. Realized gains and losses
on security transactions are determined on a specific identification basis.
Certain income from foreign securities is recorded as soon as information is
available to the Fund. Interest income and estimated expenses are accrued daily.
Discounts and premiums on securities purchased are amortized over the lives of
the respective securities. Dividend income and distributions to shareholders are
recorded on the ex-dividend date.

F. ACCOUNTING ESTIMATES

The preparation of financial statements in accordance with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the amounts of income
and expense during the reporting period. Actual results could differ from those
estimates.

G. GUARANTEES AND INDEMNIFICATIONS

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

2. SHARES OF BENEFICIAL INTEREST

At February 29, 2004, there were unlimited number of shares authorized ($0.01
par value). During the period ended February 29, 2004, there were no share
transactions; all reinvested distributions were satisfied with previously issued
shares purchased in the open market. During the prior year ended August 31,
2003, 309,686 shares were issued for $1,567,138 from reinvested distributions.

3. SENIOR FIXED-RATE NOTE

On August 29, 2003, the Fund issued $55 million principal amount of a new class
of five-year senior note (the Note). The Note is a general unsecured obligation
of the Fund and ranks senior to Trust shares and all existing or future
unsecured indebtedness of the Fund.

22 | Semiannual Report
<page>

Franklin Universal Trust

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

3. SENIOR FIXED-RATE NOTE (CONTINUED)

The Note bears interest, payable semi-annually, at the rate of 4.14% per year,
to maturity on August 29, 2008. The Note was issued in a private placement, and
is not available for resale; therefore, no market value can be obtained for the
Note. The Fund is required to maintain on a monthly basis a specified discounted
asset value for its portfolio in compliance with guidelines established by
Standard & Poor's Corporation, and is required to maintain asset coverage for
the Note of at least 300%. The Fund has met these requirements during the period
ended February 29, 2004.

The issuance costs of $200,000 incurred by the Fund are deferred and amortized
on an interest method basis over the term of the Note.

4. TRANSACTIONS WITH AFFILIATES

Certain officers and trustees of the Fund are also officers or directors of the
following entities:

- --------------------------------------------------------------------------------
ENTITY AFFILIATION
- --------------------------------------------------------------------------------
Franklin Advisers Inc. (Advisers) Investment manager
Franklin Templeton Services LLC (FT Services) Administrative manager

The Fund pays an investment management fee to Advisers of .75% per year of the
average weekly net assets of the Fund excluding the principal amount of the
Note.

Under an agreement with Advisers, FT Services provides administrative services
to the Fund. The fee is paid by Advisers based on average daily net assets, and
is not an additional expense of the Fund.

5. INCOME TAXES

At August 31, 2003, the Fund had tax basis capital losses of $47,455,063, which
may be carried over to offset future capital gains. Such losses expire as
follows:

Capital loss carryovers expiring in:
2008 .......................................... $ 5,088,195
2009 .......................................... 1,167,255
2010 .......................................... 6,827,086
2011 .......................................... 34,372,527
-----------
$47,455,063
===========

At August 31, 2003, the Fund had deferred capital losses occurring subsequent to
October 31, 2002 of $14,356,472. For tax purposes, such losses will be reflected
in the year ending August 31, 2004.

Semiannual Report | 23

Franklin Universal Trust

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

5. INCOME TAXES (CONTINUED)

At February 29, 2004, the net unrealized appreciation (depreciation) based on
the cost of investments for income tax purposes of $239,193,286 was as follows:

Unrealized appreciation .................................. $ 30,852,323
Unrealized depreciation .................................. (36,477,058)
-------------
Net unrealized appreciation (depreciation) ............... $ (5,624,735)
=============

Net investment income differs for financial statement and tax purposes primarily
due to differing treatments of defaulted securities, foreign currency
transactions, and bond discounts and premiums.

Net realized losses differ for financial statement and tax purposes primarily
due to differing treatment of defaulted bonds, foreign currency transactions,
and bond discounts and premiums.

6. INVESTMENT TRANSACTIONS

Purchases and sales of securities (excluding short-term securities) for the
period ended February 29, 2004 aggregated $49,737,326 and $46,237,967
respectively.

7. INVESTMENTS IN FRANKLIN INSTITUTIONAL FIDUCIARY TRUST MONEY MARKET PORTFOLIO

The Fund may invest in the Franklin Institutional Fiduciary Trust Money Market
Portfolio (the Sweep Money Fund), an open-end investment company managed by
Advisers. Management fees paid by the Fund are reduced on assets invested in the
Sweep Money Fund, in an amount not to exceed the management fees paid by the
Sweep Money Fund. The Fund earned $10,553 of dividend income from investment in
the Sweep Money Fund for the period ended February 29, 2004.

8. CREDIT RISK AND DEFAULTED SECURITIES

The Fund has 71.0% of its portfolio invested in below investment grade and
comparable quality unrated high yield securities, which tend to be more
sensitive to economic conditions than higher rated securities. The risk of loss
due to default by the issuer may be significantly greater for the holders of
high yielding securities because such securities are generally unsecured and are
often subordinated to other creditors of the issuer.

The Fund held defaulted securities and/or other securities for which the income
has been deemed uncollectible. The Fund discontinues accruing income on these
securities and provides an estimate for losses on interest receivable. At
February 29, 2004, the value of these securities was $4,670,301 representing
2.6% of the Fund's net assets. For information as to specific securities, see
the accompanying Statement of Investments.

24 | Semiannual Report
<page>

Franklin Universal Trust

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

9. RESTRICTED SECURITIES

At February 29, 2004, investments in securities included issues that are
restricted or illiquid. Restricted securities are often purchased in private
placement transactions, are not registered under the Securities Act of 1933, may
have contractual restrictions on resale, and are valued under methods approved
by the Board of Trustees as reflecting fair value. A security may also be
considered illiquid if it lacks a readily available market or if its valuation
has not changed for a certain period of time. At February 29, 2004, the Fund
held investments in restricted and illiquid securities that were valued under
approved methods by the Trustees, as follows:

- -------------------------------------------------------------------------------------------------------
PRINCIPAL ACQUISITION
AMOUNT/WARRANTS ISSUER DATE COST VALUE
- -------------------------------------------------------------------------------------------------------

$765,361 Atherton Franchise Capital, LP, 13.073%,
12/01/08 .................................... 4/28/94 $765,361 $267,876
3,000 Poland Telecom Finance, wts., 144A,
12/01/07 .................................... 11/24/97 18,000 --
---------
TOTAL RESTRICTED SECURITIES (.15% of net assets) ....................... $267,876
=========

10. REGULATORY MATTERS

On February 4, 2004, the Securities Division of the Office of the Secretary of
the Commonwealth of Massachusetts filed an administrative complaint against
Franklin Resources, Inc. and certain of its subsidiaries (the "Company"),
alleging violations of the Massachusetts Uniform Securities Act. The complaint
arises from activity that occurred in 2001 during which time an officer of a
Company subsidiary was negotiating an agreement with an investor relating to
investments in a mutual fund and a hedge fund.

The Fund, in addition to other entities within Franklin Templeton Investments,
including the Company and other funds, has been named in shareholder class and
derivative lawsuits related to the matter described above, as well as actions
seeking the return of certain management and other fees to the Fund. The Fund's
management believes that the claims made in the lawsuit are without merit and it
intends to defend vigorously against the allegations. It is anticipated that the
Fund may be named in similar civil actions related to the matter described
above.

In addition, as part of ongoing investigations by the U.S. Securities and
Exchange Commission (the "SEC"), the U.S. Attorney for the Northern District of
California, the New York Attorney General, the California Attorney General, the
U.S. Attorney for the District of Massachusetts, the Florida Department of
Financial Services, and the Commissioner of Securities and the Attorney General
of the State of West Virginia, relating to certain practices in the mutual fund
industry, including late trading, market timing and sales compensation
arrangements, the Company and its subsidiaries, as well as certain current or
former executives and employees of the Company, have received requests for
information and/or subpoenas to testify or produce documents. The Company and
its current employees are providing documents and information in response to
these requests and subpoenas. In addition, the Company has responded to requests
for similar kinds of information from regulatory authorities in some of the
foreign countries where the Company conducts its global asset management
business.

Semiannual Report | 25

Franklin Universal Trust

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

10. REGULATORY MATTERS (CONTINUED)

The Staff of the SEC has informed the Company that it intends to recommend that
the Commission authorize an action against the Fund's investment adviser
relating to the frequent trading issues that are the subject of the SEC's
investigation. These issues were previously disclosed as being under
investigation by government authorities and the subject of an internal inquiry
by the Company in its Annual Report on Form 10-K and on its public website. The
Company currently is in discussions with the SEC Staff in an effort to resolve
the issues raised in their investigation. The Fund's management has been advised
that the Company cannot predict the likelihood of whether those discussions will
result in a settlement and, if so, the terms of such settlement. The impact, if
any, of these matters on the Fund is uncertain at this time. If the Company
finds that it bears responsibility for any unlawful or improper conduct, it is
committed to making the Fund or its shareholders whole, as appropriate.

26 | Semiannual Report
<page>

Franklin Universal Trust

PROXY VOTING POLICIES AND PROCEDURES

The Fund has established Proxy Voting Policies and Procedures ("Policies") that
the Fund uses to determine how to vote proxies relating to portfolio securities.
Shareholders may view the Fund's complete Policies online at
franklintempleton.com. Alternatively, shareholders may request copies of the
Policies free of charge by calling the Proxy Group collect at 1-954/847-2268 or
by sending a written request to: Franklin Templeton Companies, LLC, 500 East
Broward Boulevard, Suite 1500, Fort Lauderdale, FL 33394, Attention: Proxy
Group.

Semiannual Report | 27

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Literature Request

INTERNATIONAL
Mutual European Fund
Templeton China World Fund
Templeton Developing Markets Trust
Templeton Foreign Fund
Templeton Foreign Smaller Companies Fund
Templeton International (Ex EM) Fund

GLOBAL
Franklin Global Aggressive Growth Fund
Franklin Global Growth Fund
Mutual Discovery Fund
Templeton Capital Accumulator Fund
Templeton Global Long-Short Fund
Templeton Global Opportunities Trust
Templeton Global Smaller Companies Fund
Templeton Growth Fund
Templeton World Fund

GROWTH
Franklin Aggressive Growth Fund
Franklin Capital Growth Fund
Franklin Flex Cap Growth Fund
Franklin Small-Mid Cap Growth Fund
Franklin Small Cap Growth Fund II 1

VALUE
Franklin Balance Sheet Investment Fund 2
Franklin Equity Income Fund
Franklin Large Cap Value Fund
Franklin MicroCap Value Fund 2
Franklin Small Cap Value Fund
Mutual Beacon Fund
Mutual Qualified Fund
Mutual Recovery Fund 3
Mutual Shares Fund

BLEND
Franklin Blue Chip Fund
Franklin Convertible Securities Fund
Franklin Growth Fund
Franklin Rising Dividends Fund
Franklin U.S. Long-Short Fund 4

SECTOR
Franklin Biotechnology Discovery Fund
Franklin DynaTech Fund
Franklin Global Communications Fund
Franklin Global Health Care Fund
Franklin Gold and Precious Metals Fund
Franklin Natural Resources Fund
Franklin Real Estate Securities Fund
Franklin Utilities Fund
Franklin Technology Fund
Mutual Financial Services Fund

ASSET ALLOCATION
Franklin Templeton Corefolio Allocation Fund
Franklin Templeton Founding Funds Allocation Fund

TARGET FUNDS
Franklin Templeton Conservative Target Fund
Franklin Templeton Growth Target Fund
Franklin Templeton Moderate Target Fund

INCOME
Franklin Adjustable U.S. Government Securities Fund 5
Franklin's AGE High Income Fund
Franklin Federal Money Fund 5,6
Franklin Floating Rate Daily Access Fund
Franklin Floating Rate Trust 3
Franklin Income Fund
Franklin Money Fund 5,6
Franklin Short-Intermediate U.S. Government Securities Fund 5
Franklin Strategic Income Fund
Franklin Strategic Mortgage Portfolio
Franklin Templeton Hard Currency Fund
Franklin Total Return Fund
Franklin U.S. Government Securities Fund 5
Templeton Global Bond Fund

TAX-FREE INCOME 7

NATIONAL FUNDS
Double Tax-Free Income Fund
Federal Tax-Free Income Fund
High Yield Tax-Free Income Fund
Insured Tax-Free Income Fund 8
Tax-Exempt Money Fund 5,6

LIMITED-TERM FUNDS
California Limited-Term Tax-Free Income Fund
Federal Limited-Term Tax-Free Income Fund
New York Limited-Term Tax-Free Income Fund

INTERMEDIATE-TERM FUNDS
California Intermediate-Term Tax-Free Income Fund
Federal Intermediate-Term Tax-Free Income Fund
New York Intermediate-Term Tax-Free Income Fund

STATE-SPECIFIC 7
Alabama
Arizona
California 9
Colorado
Connecticut
Florida 9
Georgia
Kentucky
Louisiana
Maryland
Massachusetts 8
Michigan 8
Minnesota 8
Missouri
New Jersey
New York 9
North Carolina
Ohio 8
Oregon
Pennsylvania
Tennessee
Virginia

INSURANCE FUNDS
Franklin Templeton Variable Insurance
Products Trust 10

1.The fund is closed to new investors. Existing shareholders can continue adding
to their accounts.

2.The fund is only open to existing shareholders as well as select retirement
plans.

3.The fund is a continuously offered, closed-end fund. Shares may be purchased
daily; there is no daily redemption. However, each quarter, pending board
approval, the fund will authorize the repurchase of 5%-25% of the outstanding
number of shares. Investors may tender all or a portion of their shares during
the tender period.

4.Upon reaching approximately $350 million in assets, the fund intends to close
to all investors.

5.An investment in the fund is neither insured nor guaranteed by the U.S.
government or by any other entity or institution.

6.No assurance exists that the fund's $1.00 per share price will be maintained.
It is possible to lose money by investing in the fund.

7.For investors subject to the alternative minimum tax, a small portion of fund
dividends may be taxable. Distributions of capital gains are generally taxable.

8.Portfolio of insured municipal securities.

9.These funds are available in two or more variations, including long-term
portfolios, portfolios of insured securities, a high-yield portfolio (CA) and
limited-term, intermediate-term and money market portfolios (CA and NY).

10.The funds of the Franklin Templeton Variable Insurance Products Trust are
generally available only through insurance company variable contracts.

02/04 Not part of the semiannual report

[LOGO OMITTED]
FRANKLIN(R) TEMPLETON(R)
INVESTMENTS
One Franklin Parkway
San Mateo, CA 94403-1906

SEMIANNUAL REPORT AND SHAREHOLDER INFORMATION
Franklin Universal Trust

INVESTMENT MANAGER
Franklin Advisers, Inc.
1-800/DIAL BEN(R)

TRANSFER AGENT
PFPC Inc.
P.O. Box 43027
Providence, RI 02940-3027

To ensure the highest quality of service, telephone calls to or from our service
departments may be monitored, recorded and accessed. These calls can be
identified by the presence of a regular beeping tone.

FUT S2004 04/04

ITEM 2. CODE OF ETHICS.

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

(d) N/A

(f) Pursuant to Item 11(A), the Registrant is attaching as an exhibit a copy of
its code of ethics that applies to its principal executive officers financial
and accounting officer.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

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

(2) The audit committee financial expert is Frank W.T. LaHaye, and he is
"independent" as defined under the relevant Securities and Exchange Commission
Rules and Releases.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. N/A

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. THE MEMBERS OF THE AUDIT
COMMITTEE ARE: ROBERT F. CARLSON, S. JOSEPH FORTUNATO AND FRANK W. T. LAHAYE

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES. N/A

ITEM 8. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS. N/A

ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. There have been no
changes to the procedures by which shareholders may recommend nominee to the
Registrant's Board of Trustees that would require disclosure herein.

ITEM 10. CONTROLS AND PROCEDURES.
(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains
disclosure controls and procedures that are designed to ensure that information
required to be disclosed in the Registrant's filings under the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 is recorded,
processed, summarized and reported within the periods specified in the rules and
forms of the Securities and Exchange Commission. Such information is accumulated
and communicated to the Registrant's management, including its principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure. The Registrant's management,
including the principal executive officer and the principal financial officer,
recognizes that any set of controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving the desired
control objectives.

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

(B) CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the
Registrant's internal controls or in other factors that could significantly
affect the internal controls subsequent to the date of their evaluation in
connection with the preparation of this Shareholder Report on Form N-CSR.

ITEM 11. EXHIBITS.

(A) Code of Ethics for Principal Executive and Senior Financial Officers.

(B)(1) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration, and
Diomedes Loo-Tam, Chief Financial Officer

(B)(2) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration, and
Diomedes Loo-Tam, Chief Financial Officer

SIGNATURES

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

FRANKLIN UNIVERSAL TRUST

By /s/Jimmy D. Gambill
Chief Executive Officer - Finance and Administration
Date April 30, 2004

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

By /s/Jimmy D. Gambill
Chief Executive Officer - Finance and Administration
Date April 30, 2004

By /s/Diomedes Loo-Tam
Chief Financial Officer
Date April 30, 2004