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 811-07038
---------
THE MONEY MARKET PORTFOLIOS
---------------------------
(Exact name of registrant as specified in charter)
ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
----------------------------------------------
(Address of principal executive offices) (Zip code)
CRAIG S. TYLE, ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
-------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: 650 312-2000
------------
Date of fiscal year end: 6/30
----
Date of reporting period: 12/31/09
---------
ITEM 1. REPORTS TO STOCKHOLDERS.
The Money Market Portfolios
FINANCIAL HIGHLIGHTS
THE MONEY MARKET PORTFOLIO
SIX MONTHS ENDED YEAR ENDED JUNE 30,
DECEMBER 31, 2009 ------------------------------------------------------------------
(UNAUDITED) 2009 2008 2007 2006 2005
----------------- ---------- ---------- ---------- ---------- ----------
PER SHARE OPERATING PERFORMANCE
(for a share outstanding throughout
the period)
Net asset value, beginning of period ... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- ----------
Income from investment operations:
Net investment income ............... --(a) 0.011 0.040 0.052 0.041 0.020
Net realized and unrealized gains
(losses) ......................... --(a) (--)(a) -- (--)(a) -- --
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ....... --(a) 0.011 0.040 0.052 0.041 0.020
---------- ---------- ---------- ---------- ---------- ----------
Less distributions from net
investment income ................... (--)(a) (0.011) (0.040) (0.052) (0.041) (0.020)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of period ......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ========== ==========
Total return(b) ........................ 0.04% 1.14% 4.10% 5.28% 4.15% 2.06%
RATIOS TO AVERAGE NET ASSETS(c)
Expenses(d) ............................ 0.16% 0.15% 0.16% 0.15% 0.16% 0.16%
Net investment income .................. 0.07% 1.12% 4.02% 5.17% 4.09% 2.04%
SUPPLEMENTAL DATA
Net assets, end of period (000's) ...... $7,274,913 $8,520,392 $7,028,194 $6,580,101 $4,993,739 $5,676,479
(a) Amount rounds to less than $0.001 per share.
(b) Total return is not annualized for periods less than one year.
(c) Ratios are annualized for periods less than one year.
(d) Benefit of expense reduction rounds to less than 0.01%.
The accompanying notes are an integral part of these financial statements.
Semiannual Report | 17
The Money Market Portfolios
STATEMENT OF INVESTMENTS, DECEMBER 31, 2009 (UNAUDITED)
THE MONEY MARKET PORTFOLIO PRINCIPAL AMOUNT(a) VALUE
-------------------------- ------------------- --------------
INVESTMENTS 99.9%
CERTIFICATES OF DEPOSIT 38.4%
Australia and New Zealand Banking Group Ltd., New York Branch, 0.17%, 3/29/10 ....... $ 75,000,000 $ 75,000,000
Bank of Montreal, Chicago Branch, 0.16%, 1/19/10 .................................... 100,000,000 100,000,000
Bank of Montreal, Chicago Branch, 0.17%, 2/08/10 .................................... 150,000,000 150,001,583
Bank of Nova Scotia, Houston Branch, 0.16%, 1/11/10 ................................. 100,000,000 100,000,000
Bank of Nova Scotia, Houston Branch, 0.08% - 0.21%, 1/04/10 - 1/21/10 ............... 100,000,000 100,000,000
Bank of Nova Scotia, Houston Branch, 0.17%, 1/25/10 ................................. 100,000,000 100,000,333
Banque Nationale De Paris, San Francisco Branch, 0.08% - 0.23%, 1/15/10 - 1/21/10 ... 100,000,000 100,000,000
Banque Nationale De Paris, San Francisco Branch, 0.26%, 2/26/10 ..................... 100,000,000 100,000,000
Banque Nationale De Paris, San Francisco Branch, 0.21%, 3/03/10 ..................... 100,000,000 100,000,000
Barclays Bank PLC, New York Branch, 0.15%, 1/19/10 .................................. 250,000,000 250,000,000
Calyon NY, New York Branch, 0.25%, 2/26/10 .......................................... 100,000,000 100,000,000
Calyon NY, New York Branch, 0.24%, 3/12/10 .......................................... 100,000,000 100,000,000
Calyon NY, New York Branch, 0.15% - 0.24%, 2/02/10 - 3/18/10 ........................ 100,000,000 100,000,000
National Australia Bank, New York Branch, 0.20%, 1/04/10 ............................ 50,000,000 50,000,000
National Australia Bank, New York Branch, 0.22%, 2/18/10 ............................ 100,000,000 100,000,000
Royal Bank of Canada, New York Branch, 0.10%, 1/11/10 ............................... 250,000,000 250,000,347
Societe Generale, New York Branch, 0.14%, 2/01/10 ................................... 50,000,000 50,000,431
Societe Generale, New York Branch, 0.23%, 2/04/10 ................................... 250,000,000 250,000,000
Svenska Handelsbanken, New York Branch, 0.21%, 3/17/10 .............................. 250,000,000 250,000,000
The Toronto-Dominion Bank, New York Branch, 0.14%, 1/04/10 .......................... 200,000,000 200,000,000
The Toronto-Dominion Bank, New York Branch, 0.19%, 2/12/10 .......................... 70,000,000 70,000,408
Westpac Banking Corp., New York Branch, 0.21% - 0.26%, 1/11/10 - 4/06/10 ............ 100,000,000 100,000,000
--------------
TOTAL CERTIFICATES OF DEPOSIT (COST $2,795,003,102) ................................. 2,795,003,102
--------------
(b) COMMERCIAL PAPER 40.8%
Abbott Laboratories, 1/05/10 - 3/08/10 .............................................. 92,185,000 92,173,700
Abbott Laboratories, 3/15/10 ........................................................ 76,000,000 75,981,507
Abbott Laboratories, 3/22/10 ........................................................ 83,000,000 82,977,867
Australia and New Zealand Banking Group Ltd., 1/22/10 - 2/16/10 (Australia) ......... 100,000,000 99,980,111
Australia and New Zealand Banking Group Ltd., 3/08/10 (Australia) ................... 100,000,000 99,963,333
ChevronTexaco Funding Corp., 1/05/10 - 1/29/10 ...................................... 180,000,000 179,994,450
Commonwealth Bank of Australia, 1/25/10 (Australia) ................................. 100,000,000 99,985,167
Commonwealth Bank of Australia, 1/28/10 - 2/25/10 (Australia) ....................... 150,000,000 149,971,347
Export Development Canada, 1/13/10 - 2/24/10 (Canada) ............................... 55,381,000 55,377,334
Government of Canada, 2/09/10 (Canada) .............................................. 45,000,000 44,981,963
Government of Canada, 3/29/10 (Canada) .............................................. 100,000,000 99,891,250
Government of Canada, 3/31/10 (Canada) .............................................. 130,000,000 129,861,803
Johnson & Johnson, 1/19/10 .......................................................... 150,000,000 149,992,500
Johnson & Johnson, 2/01/10 .......................................................... 50,000,000 49,995,910
National Australia Funding, 1/05/10 (Australia) ..................................... 100,000,000 99,997,833
Nestle Capital Corp., 2/22/10 ....................................................... 125,000,000 124,983,389
Nestle Capital Corp., 1/07/10 - 2/23/10 ............................................. 144,176,000 144,166,114
Pitney Bowes Credit Corp., 1/04/10 .................................................. 49,537,000 49,536,959
Province of British Columbia, 1/15/10 - 3/24/10 (Canada) ............................ 143,300,000 143,278,786
Province of British Columbia, 2/25/10 - 3/23/10 (Canada) ............................ 149,100,000 148,997,838
Province of Ontario, 2/05/10, (Canada) .............................................. 88,700,000 88,683,615
Province of Ontario, 2/26/10, (Canada) .............................................. 103,000,000 102,979,171
Province of Ontario, 3/09/10 - 3/17/10 (Canada) ..................................... 84,500,000 84,478,247
18 | Semiannual Report
The Money Market Portfolios
STATEMENT OF INVESTMENTS, DECEMBER 31, 2009 (UNAUDITED) (CONTINUED)
THE MONEY MARKET PORTFOLIO PRINCIPAL AMOUNT(a) VALUE
-------------------------- ------------------- --------------
INVESTMENTS (CONTINUED)
(b) COMMERCIAL PAPER (CONTINUED)
Rabobank USA Financial Corp., 2/19/10 ............................................... $122,405,000 $ 122,368,346
Rabobank USA Financial Corp., 3/09/10 ............................................... 100,000,000 99,964,639
United Parcel Service of America Inc., 1/11/10 ...................................... 50,000,000 49,999,028
United Parcel Service of America Inc., 1/20/10 ...................................... 150,000,000 149,994,458
Westpac Banking Corp., 2/02/10 (Australia) .......................................... 100,000,000 99,980,444
Westpac Banking Corp., 2/19/10 (Australia) .......................................... 50,000,000 49,985,708
--------------
TOTAL COMMERCIAL PAPER (COST $2,970,522,817) ........................................ 2,970,522,817
--------------
U.S. GOVERNMENT AND AGENCY SECURITIES 11.4%
FHLB, 0.112% - 0.56%, 1/04/10 - 6/22/10 ............................................. 77,601,000 77,594,436
(b) International Bank for Reconstruction & Development, 1/04/10 - 1/05/10
(Supranational(c)) ............................................................... 52,945,000 52,944,712
(b) U.S. Treasury Bill, 1/14/10 ......................................................... 100,000,000 99,983,614
(b) U.S. Treasury Bill, 6/03/10 ......................................................... 250,000,000 249,472,575
(b) U.S. Treasury Bill, 8/26/10 ......................................................... 100,000,000 99,705,396
(b) U.S. Treasury Bill, 9/23/10 ......................................................... 150,000,000 149,573,424
(b) U.S. Treasury Bill, 12/16/10 ........................................................ 100,000,000 99,595,257
--------------
TOTAL U.S. GOVERNMENT AND AGENCY SECURITIES (COST $828,869,414) ..................... 828,869,414
--------------
TOTAL INVESTMENTS BEFORE REPURCHASE AGREEMENTS (COST $6,594,395,333) ................ 6,594,395,333
--------------
(d) REPURCHASE AGREEMENTS 9.3%
Banc of America Securities LLC, 0.010%, 1/04/10 (Maturity Value $50,000,056)
Collateralized by U.S. Government Agency Securities, 5.80%, 2/09/26 .............. 50,000,000 50,000,000
Deutsche Bank Securities Inc., 0.000%, 1/04/10 (Maturity Value $75,000,000)
Collateralized by U.S. Treasury Notes, 4.50%, 11/15/10 ........................... 75,000,000 75,000,000
Goldman, Sachs & Co., 0.000%, 1/04/10 (Maturity Value $250,000,000)
Collateralized by U.S. Government and Agency Securities, 3.25% - 5.125%,
2/25/11 - 7/15/12 ............................................................. 250,000,000 250,000,000
HSBC Securities (USA) Inc., 0.010%, 1/04/10 (Maturity Value $150,000,167)
Collateralized by U.S. Government and Agency Securities 1.375% - 7.25%,
1/15/10 - 10/18/13 ............................................................ 150,000,000 150,000,000
Morgan Stanley & Co. Inc., 0.000%, 1/04/10 (Maturity Value $100,00,000)
Collateralized by U.S. Treasury Notes, 2.125% - 4.25%, 11/15/14 - 11/30/14 ....... 100,000,000 100,000,000
UBS Securities LLC., 0.000%, 1/04/10 (Maturity Value $50,000,000)
Collateralized by U.S. Government and Agency Securities, 3.125% - 6.00%,
5/15/11 - 9/29/14 ............................................................. 50,000,000 50,000,000
--------------
TOTAL REPURCHASE AGREEMENTS (COST $675,000,000) ..................................... 675,000,000
--------------
TOTAL INVESTMENTS (COST $7,269,395,333) 99.9% ....................................... 7,269,395,333
OTHER ASSETS, LESS LIABILITIES 0.1% ................................................. 5,518,000
--------------
NET ASSETS 100.0% ................................................................... $7,274,913,333
==============
See Abbreviations on page 27.
(a) The principal amount is stated in U.S. dollars unless otherwise indicated.
(b) The security is traded on a discount basis with no stated coupon rate.
(c) A supranational organization is an entity formed by two or more central
governments through international treaties.
(d) See Note 1(b) regarding repurchase agreements.
The accompanying notes are an integral part of these financial statements.
Semiannual Report | 19
The Money Market Portfolios
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
December 31, 2009 (unaudited)
THE
MONEY MARKET
PORTFOLIO
--------------
Assets:
Investments in securities, at amortized cost ............... $6,594,395,333
Repurchase agreements, at value and cost ................... 675,000,000
--------------
Total investments .................................... $7,269,395,333
Cash ....................................................... 6,049,316
Interest receivable ........................................ 661,477
--------------
Total assets ......................................... 7,276,106,126
--------------
Liabilities:
Payables:
Affiliates .............................................. 1,046,709
Custodian fees (Note 4) ................................. 70,986
Accrued expenses and other liabilities ..................... 75,098
--------------
Total liabilities .................................... 1,192,793
--------------
Net assets, at value .............................. $7,274,913,333
--------------
Net assets consist of:
Paid-in capital ............................................ $7,278,117,957
Accumulated net realized gain (loss) ....................... (3,204,624)
--------------
Net assets, at value .............................. $7,274,913,333
==============
Shares outstanding ............................................ 7,278,117,957
==============
Net asset value per share ..................................... $ 1.00
==============
The accompanying notes are an integral part of these financial statements.
20 | Semiannual Report
The Money Market Portfolios
FINANCIAL STATEMENTS (CONTINUED)
STATEMENT OF OPERATIONS
for the six months ended December 31, 2009 (unaudited)
THE
MONEY MARKET
PORTFOLIO
------------
Investment income:
Interest ...................................................... $10,171,515
-----------
Expenses:
Management fees (Note 3a) ..................................... 6,634,535
Custodian fees (Note 4) ....................................... 66,788
Reports to shareholders ....................................... 3,794
Professional fees ............................................. 62,249
Other ......................................................... 111,140
-----------
Total expenses ............................................. 6,878,506
Expense reductions (Note 4) ................................ (344)
-----------
Net expenses ............................................ 6,878,162
-----------
Net investment income ................................ 3,293,353
-----------
Net realized gain (loss) from investments ........................ 27,393
-----------
Net increase (decrease) in net assets resulting from operations .. $ 3,320,746
===========
The accompanying notes are an integral part of these financial statements.
Semiannual Report | 21
The Money Market Portfolios
FINANCIAL STATEMENTS (CONTINUED)
STATEMENTS OF CHANGES IN NET ASSETS
THE MONEY MARKET PORTFOLIO
----------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2009 YEAR ENDED
(UNAUDITED) JUNE 30, 2009
----------------- --------------
Increase (decrease) in net assets:
Operations:
Net investment income ............................................... $ 3,293,353 $ 96,400,635
Net realized gain (loss) from investments ........................... 27,393 (3,212,548)
--------------- --------------
Net increase (decrease) in net assets resulting from operations .. 3,320,746 93,188,087
Distributions to shareholders from net investment income ............... (3,293,353) (96,400,635)
Capital share transactions (Note 2) .................................... (1,245,506,437) 1,495,410,735
--------------- --------------
Net increase (decrease) in net assets ............................ (1,245,479,044) 1,492,198,187
Net assets (there is no undistributed net investment income at
beginning or end of period):
Beginning of period .................................................... 8,520,392,377 7,028,194,190
--------------- --------------
End of period .......................................................... $ 7,274,913,333 $8,520,392,377
=============== ==============
The accompanying notes are an integral part of these financial statements.
22 | Semiannual Report
The Money Market Portfolios
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
THE MONEY MARKET PORTFOLIO
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The Money Market Portfolios (Trust) is registered under the Investment Company
Act of 1940, as amended, (1940 Act) as an open-end investment company,
consisting of one portfolio, The Money Market Portfolio (Portfolio). The shares
of the Portfolio are issued in private placements and are exempt from
registration under the Securities Act of 1933.
The following summarizes the Portfolio's significant accounting policies.
A. SECURITY VALUATION
Securities are valued at amortized cost which approximates market value. This
method involves valuing an instrument at its cost and thereafter assuming a
constant amortization to maturity of any discount or premium. All security
valuation procedures are approved by the Trust's Board of Trustees.
B. REPURCHASE AGREEMENTS
The Portfolio may enter into repurchase agreements, which are accounted for as a
loan by the Portfolio to the seller, collateralized by securities which are
delivered to the Portfolio's custodian. The market value, including accrued
interest, of the initial collateralization is required to be at least 102% of
the dollar amount invested by the Portfolio, with the value of the underlying
securities marked to market daily to maintain coverage of at least 100%. All
repurchase agreements held by the Portfolio at period end had been entered into
on December 31, 2009. Repurchase agreements are valued at cost which
approximates market value.
C. INCOME TAXES
No provision has been made for U.S. income taxes because it is the Portfolio's
policy to qualify as a regulated investment company under the Internal Revenue
Code and to distribute to shareholders substantially all of its taxable income
and net realized gains.
The Portfolio has reviewed the tax positions, taken on federal income tax
returns, for each of the three open tax years and as of December 31, 2009, and
has determined that no provision for income tax is required in the Portfolio's
financial statements.
D. 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.
Interest income and estimated expenses are accrued daily. Amortization of
premium and accretion of discount on debt securities are included in interest
income. Dividends from net investment income are normally declared daily;
Semiannual Report | 23
The Money Market Portfolios
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
THE MONEY MARKET PORTFOLIO
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. SECURITY TRANSACTIONS, INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS
(CONTINUED)
these dividends are reinvested and paid monthly. Distributions to shareholders
are determined according to income tax regulations (tax basis). Distributable
earnings determined on a tax basis may differ from earnings recorded in
accordance with accounting principles generally accepted in the United States of
America. These differences may be permanent or temporary. Permanent differences
are reclassified among capital accounts to reflect their tax character. These
reclassifications have no impact on net assets or the results of operations.
Temporary differences are not reclassified, as they may reverse in subsequent
periods.
E. 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 expenses during the reporting period. Actual results could differ from those
estimates.
F. GUARANTEES AND INDEMNIFICATIONS
Under the Trust's organizational documents, its officers and trustees are
indemnified by the Trust against certain liabilities arising out of the
performance of their duties to the Trust. Additionally, in the normal course of
business, the Trust, on behalf of the Portfolio, enters into contracts with
service providers that contain general indemnification clauses. The Trust's
maximum exposure under these arrangements is unknown as this would involve
future claims that may be made against the Trust that have not yet occurred.
Currently, the Trust expects the risk of loss to be remote.
2. SHARES OF BENEFICIAL INTEREST
At December 31, 2009, there were an unlimited number of shares authorized
(without par value). Transactions in the Portfolio's shares at $1.00 per share
were as follows:
SIX MONTHS ENDED YEAR ENDED
DECEMBER 31, 2009 JUNE 30, 2009
----------------- ----------------
Shares sold ...................................... $ 8,833,234,100 $ 14,699,668,141
Shares issued in reinvestment of distributions ... 3,284,302 96,416,354
Shares redeemed .................................. (10,082,024,839) (13,300,673,760)
---------------- ----------------
Net increase (decrease) .......................... $ (1,245,506,437) $ 1,495,410,735
================ ================
24 | Semiannual Report
The Money Market Portfolios
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
THE MONEY MARKET PORTFOLIO
3. TRANSACTIONS WITH AFFILIATES
Franklin Resources, Inc. is the holding company for various subsidiaries that
together are referred to as Franklin Templeton Investments. Certain officers and
trustees of the Trust are also officers, directors, and/or trustees of the
Franklin Money Fund, the Franklin Templeton Money Fund Trust, the Institutional
Fiduciary Trust, and of the following subsidiaries:
SUBSIDIARY AFFILIATION
- ---------- -----------
Franklin Advisers, Inc. (Advisers) Investment manager
Franklin Templeton Investor Services, LLC (Investor Services) Transfer agent
A. MANAGEMENT FEES
The Portfolio pays an investment management fee to Advisers of 0.15% per year of
the average daily net assets of the Portfolio.
B. TRANSFER AGENT FEES
Investor Services, under terms of an agreement, performs shareholder servicing
for the Portfolio and is not paid by the Portfolio for the services.
C. OTHER AFFILIATED TRANSACTIONS
At December 31, 2009, the shares of the Portfolio were owned by the following
entities:
PERCENTAGE OF
SHARES OUTSTANDING SHARES
------------- ------------------
Institutional Fiduciary Trust - Money Market Portfolio ..... 4,908,987,917 67.45%
Franklin Money Fund ........................................ 2,052,235,060 28.20%
Franklin Templeton Money Fund Trust -
Franklin Templeton Money Fund ........................... 316,894,980 4.35%
4. EXPENSE OFFSET ARRANGEMENT
The Portfolio has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash balances are used to reduce a portion of
the Portfolio's custodian expenses. During the period ended December 31, 2009,
the custodian fees were reduced as noted in the Statement of Operations.
Semiannual Report | 25
The Money Market Portfolios
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
THE MONEY MARKET PORTFOLIO
5. INCOME TAXES
For tax purposes, capital losses may be carried over to offset future capital
gains, if any. At June 30, 2009, the capital loss carryforwards were as follows:
Capital loss carryforwards expiring in:
2016 .................................. $ 19,469
2017 .................................. 3,212,548
----------
$3,232,017
==========
At December 31, 2009, the cost of investments for book and income tax purposes
was the same.
6. FAIR VALUE MEASUREMENTS
The Portfolio follows a fair value hierarchy that distinguishes between market
data obtained from independent sources (observable inputs) and the Portfolio's
own market assumptions (unobservable inputs). These inputs are used in
determining the value of the Portfolio's investments and are summarized in the
following fair value hierarchy:
- Level 1 - quoted prices in active markets for identical securities
- Level 2 - other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speed, credit risk,
etc.)
- Level 3 - significant unobservable inputs (including the Portfolio's
own assumptions in determining the fair value of investments)
The inputs or methodology used for valuing securities are not an indication of
the risk associated with investing in those securities. Money market securities
may be valued using amortized cost, in accordance with the 1940 Act. Generally,
amortized cost reflects the current fair value of a security, but since the
value is not obtained from a quoted price in an active market, such securities
are reflected as a Level 2.
At December 31, 2009, all of the Portfolio's investments in securities carried
at fair value were in Level 2 inputs.
26 | Semiannual Report
The Money Market Portfolios
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
THE MONEY MARKET PORTFOLIO
7. NEW ACCOUNTING PRONOUNCEMENTS
In January 2010, the Financial Accounting Standards Board issued Accounting
Standards Update (ASU) No. 2010-6, FAIR VALUE MEASUREMENTS AND DISCLOSURES
(TOPIC 820): IMPROVING DISCLOSURES ABOUT FAIR VALUE MEASUREMENTS. ASU No. 2010-6
enhances and clarifies existing fair value measurement disclosure requirements
and is effective for interim and annual periods beginning after December 15,
2009. The Portfolio is currently evaluating the impact, if any, of applying the
provisions of ASU No. 2010-6.
8. SUBSEQUENT EVENTS
The Portfolio has evaluated subsequent events through February 16, 2010, the
issuance date of the financial statements and determined that no events have
occurred that require disclosure.
ABBREVIATIONS
SELECTED PORTFOLIO
FHLB - Federal Home Loan Bank
Semiannual Report | 27
Franklin Money Fund
SHAREHOLDER INFORMATION
PROXY VOTING POLICIES AND PROCEDURES
The Fund's investment manager 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 (954) 527-7678 or by sending a written request to: Franklin Templeton
Companies, LLC, 500 East Broward Boulevard, Suite 1500, Fort Lauderdale, FL
33394, Attention: Proxy Group. Copies of the Fund's proxy voting records are
also made available online at franklintempleton.com and posted on the U.S.
Securities and Exchange Commission's website at sec.gov and reflect the most
recent 12-month period ended June 30.
QUARTERLY STATEMENT OF INVESTMENTS
The Fund files a complete statement of investments with the U.S. Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
website at sec.gov. The filed form may also be viewed and copied at the
Commission's Public Reference Room in Washington, DC. Information regarding the
operations of the Public Reference Room may be obtained by calling (800)
SEC-0330.
28 | Semiannual Report
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.
(c) N/A
(d) N/A
(f) Pursuant to Item 12(a)(1), the Registrant is attaching as an exhibit a copy
of its code of ethics that applies to its principal executive officers and
principal financial and accounting officer.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) The Registrant has an audit committee financial expert serving on its
audit committee.
(2) The audit committee financial expert is John B. Wilson and he is
"independent" as defined under the relevant Securities and Exchange Commission
Rules and Releases.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. N/A
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. N/A
ITEM 6. SCHEDULE OF INVESTMENTS. N/A
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES. N/A
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. N/A
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS. N/A
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no changes to the procedures by which shareholders may recommend
nominees to the Registrant's Board of Trustees that would require disclosure
herein.
ITEM 11. CONTROLS AND PROCEDURES.
(a) EVALUATION OF DISCLOSURE CONTROLS
AND PROCEDURES. The Registrant maintains disclosure controls and procedures that
are designed to ensure that information required to be disclosed in the
Registrant's filings under the Securities Exchange Act of 1934 and the
Investment Company Act of 1940 is recorded, processed, summarized and reported
within the periods specified in the rules and forms of the Securities and
Exchange Commission. Such information is accumulated and communicated to the
Registrant's management, including its principal executive officer and principal
financial officer, as appropriate, to allow timely decisions regarding required
disclosure. The Registrant's management, including the principal executive
officer and the principal financial officer, recognizes that any set of controls
and procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives.
Within 90 days prior to the filing date of this Shareholder Report on Form
N-CSR, the Registrant had carried out an evaluation, under the supervision and
with the participation of the Registrant's management, including the
Registrant's principal executive officer and the Registrant's principal
financial officer, of the effectiveness of the design and operation of the
Registrant's disclosure controls and procedures. Based on such evaluation, the
Registrant's principal executive officer and principal financial officer
concluded that the Registrant's disclosure controls and procedures are
effective.
(b) CHANGES IN INTERNAL CONTROLS. There have been no 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 12. EXHIBITS.
(a)(1) Code of Ethics
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
of Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and
Gaston Gardey, Chief Financial Officer and Chief Accounting Officer
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of
Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and
Gaston Gardey, Chief Financial Officer and Chief Accounting Officer
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
THE MONEY MARKET PORTFOLIOS
By /s/LAURA F. FERGERSON
-------------------------
Laura F. Fergerson
Chief Executive Officer -
Finance and Administration
Date February 25, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By /s/LAURA F. FERGERSON
------------------------
Laura F. Fergerson
Chief Executive Officer -
Finance and Administration
Date February 25, 2010
By /s/GASTON GARDEY
---------------------
Gaston Gardey
Chief Financial Officer and
Chief Accounting Officer
Date February 25, 2010