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<PAGE> PAGE 2
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SIGNATURE LAURA FERGERSON
TITLE ASST. TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FRANKLIN
FEDERAL MONEY FUND JUNE 30, 1997 ANNUAL REPORT AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000316403
<NAME> FRANKLIN FEDERAL MONEY FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 121,880,951
<INVESTMENTS-AT-VALUE> 121,880,951
<RECEIVABLES> 0
<ASSETS-OTHER> 3,060
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 121,884,011
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 593,169
<TOTAL-LIABILITIES> 593,169
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 121,290,842
<SHARES-COMMON-STOCK> 121,290,842
<SHARES-COMMON-PRIOR> 127,658,676
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 121,290,842
<DIVIDEND-INCOME> 6,766,973
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
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<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 5,866,901
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,866,901)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 269,360,701
<NUMBER-OF-SHARES-REDEEMED> (281,558,490)
<SHARES-REINVESTED> 5,829,955
<NET-CHANGE-IN-ASSETS> (6,367,834)
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<ACCUMULATED-GAINS-PRIOR> 0
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<PER-SHARE-NAV-BEGIN> 1.000
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<PER-SHARE-DIVIDEND> (0.045)
<PER-SHARE-DISTRIBUTIONS> .000
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<AVG-DEBT-PER-SHARE> 0
</TABLE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors
of Franklin Federal Money Fund:
We have audited the accompanying statement of
assets and liabilities of the Franklin Federal
Money Fund, including the statement of
investments in securities and net assets, as of
June 30, 1997, and the related statement of
operations for the year then ended, the
statements of changes in net assets for each of
the two years in the period then ended, and the
financial highlights for each of the periods
presented. These financial statements and
financial highlights are the responsibility of
the Fund's management. Our responsibility is to
express an opinion on these financial statements
and financial highlights based on our audits.
We conducted our audits in accordance with
generally accepted auditing standards. Those
standards require that we plan and perform the
audit to obtain reasonable assurance about
whether the financial statements and financial
highlights are free of material misstatement. An
audit includes examining, on a test basis,
evidence supporting the amounts and disclosures
in the financial statements. Our procedures
included confirmation of securities owned as of
June 30, 1997, by correspondence with the
custodian. An audit also includes assessing the
accounting principles used and significant
estimates made by management, as well as
evaluating the overall financial statement
presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements and
financial highlights referred to above present
fairly, in all material respects, the financial
position of the Franklin Federal Money Fund as
of June 30, 1997, the results of its operations
for the year then ended, the changes in its net
assets for each of the two years in the period
then ended, and the financial highlights for the
periods presented, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
San Francisco, California
August 4, 1997
