PAGE 1
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PAGE 2
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PAGE 3
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PAGE 4
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PAGE 5
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PAGE 6
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PAGE 7
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PAGE 8
015 A000139 CHASE MANHATTAN BANK
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PAGE 9
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PAGE 10
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PAGE 11
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PAGE 12
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PAGE 13
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PAGE 14
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PAGE 15
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PAGE 16
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PAGE 17
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PAGE 18
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PAGE 19
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PAGE 20
074 P000200 0
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075 A000200 151404
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076 000200 0.00
080 A000200 ICI MUTUAL INSURANCE CO
080 B000200 NONE
080 C000200 130000
081 A000200 Y
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082 A000200 N
082 B000200 0
083 A000200 N
083 B000200 0
084 A000200 N
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085 A000200 Y
085 B000200 N
SIGNATURE /s/JAMES R. BAIO
JAMES R. BAIO
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE TEMPLETON GLOBAL BOND FUND AUGUST 31, 1996 ANNUAL REPORT AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000795402
<NAME> TEMPLETON GLOBAL BOND FUND CLASS I
<SERIES>
<NUMBER> 011
<NAME> TEMPLETON INCOME TRUST
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1996
<PERIOD-END> AUG-31-1996
<INVESTMENTS-AT-COST> 188921736
<INVESTMENTS-AT-VALUE> 187307554
<RECEIVABLES> 5237477
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 84341
<TOTAL-ASSETS> 192629372
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 470430
<TOTAL-LIABILITIES> 470430
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 197078835
<SHARES-COMMON-STOCK> 19015037
<SHARES-COMMON-PRIOR> 20536570
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (3351051)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (1568842)
<NET-ASSETS> 192158942
<DIVIDEND-INCOME> 725468
<INTEREST-INCOME> 15184186
<OTHER-INCOME> 0
<EXPENSES-NET> 2198625
<NET-INVESTMENT-INCOME> 13711029
<REALIZED-GAINS-CURRENT> (163615)
<APPREC-INCREASE-CURRENT> 7528543
<NET-CHANGE-FROM-OPS> 21075957
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (11385814)
<DISTRIBUTIONS-OF-GAINS> (377284)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3539465
<NUMBER-OF-SHARES-REDEEMED> (5902799)
<SHARES-REINVESTED> 841801
<NET-CHANGE-IN-ASSETS> (1184795)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (5288377)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 968182
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2198625
<AVERAGE-NET-ASSETS> 189732836
<PER-SHARE-NAV-BEGIN> 9.32
<PER-SHARE-NII> .69
<PER-SHARE-GAIN-APPREC> .35
<PER-SHARE-DIVIDEND> (.58)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> (.02)
<PER-SHARE-NAV-END> 9.76
<EXPENSE-RATIO> 1.13
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
TEMPLETON GLOBAL BOND FUND AUGUST 31, 1996 ANNUAL REPORT AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 012
<NAME> GLOBAL BOND FUND CLASS II
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1996
<PERIOD-END> AUG-31-1996
<INVESTMENTS-AT-COST> 188921736
<INVESTMENTS-AT-VALUE> 187307554
<RECEIVABLES> 5237477
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 84341
<TOTAL-ASSETS> 192629372
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 470430
<TOTAL-LIABILITIES> 470430
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 197078835
<SHARES-COMMON-STOCK> 671960
<SHARES-COMMON-PRIOR> 219355
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (3351051)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (1568842)
<NET-ASSETS> 192158942
<DIVIDEND-INCOME> 725468
<INTEREST-INCOME> 15184186
<OTHER-INCOME> 0
<EXPENSES-NET> 2198625
<NET-INVESTMENT-INCOME> 13711029
<REALIZED-GAINS-CURRENT> (163615)
<APPREC-INCREASE-CURRENT> 7528543
<NET-CHANGE-FROM-OPS> 21075957
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (224274)
<DISTRIBUTIONS-OF-GAINS> (7432)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 584301
<NUMBER-OF-SHARES-REDEEMED> (150240)
<SHARES-REINVESTED> 18544
<NET-CHANGE-IN-ASSETS> (1184795)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (5288377)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 968182
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2198625
<AVERAGE-NET-ASSETS> 3923238
<PER-SHARE-NAV-BEGIN> 9.31
<PER-SHARE-NII> .61
<PER-SHARE-GAIN-APPREC> .41
<PER-SHARE-DIVIDEND> (.54)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> (.02)
<PER-SHARE-NAV-END> 9.77
<EXPENSE-RATIO> 1.56
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
TEMPLETON MONEY FUND AUGUST 31, 1996 ANNUAL REPORT AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<SERIES>
<NUMBER> 2
<NAME> TEMPLETON MONEY FUND
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1996
<PERIOD-END> AUG-31-1996
<INVESTMENTS-AT-COST> 164827229
<INVESTMENTS-AT-VALUE> 164827229
<RECEIVABLES> 1016143
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 139255
<TOTAL-ASSETS> 165982627
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 797569
<TOTAL-LIABILITIES> 797569
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 165185058
<SHARES-COMMON-PRIOR> 137245408
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 165185058
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 8421331
<OTHER-INCOME> 0
<EXPENSES-NET> 1455898
<NET-INVESTMENT-INCOME> 6965433
<REALIZED-GAINS-CURRENT> 2105
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 6967538
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (6967538)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 529872656
<NUMBER-OF-SHARES-REDEEMED> (508275711)
<SHARES-REINVESTED> 6342705
<NET-CHANGE-IN-ASSETS> 27939650
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 533128
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1664494
<AVERAGE-NET-ASSETS> 151406687
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .04
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (.04)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .96<F1>
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<FN>
<F1>The Expense ratio for the Templeton Money Fund for August 31, 1996 without
reimbursement was 1.10%.
</FN>
</TABLE>
The Board of Trustees and Shareholders
Templeton Income Trust
In planning and performing our audits of the financial statements of Templeton
Global Bond Fund and Templeton Money Fund series of Templeton Income Trust for
the year ended August 31, 1996, we considered their internal control structure,
including procedures for safeguarding securities, in order to determine our
auditing procedures for the purpose of expressing our opinion on the financial
statements and to comply with the requirements of Form N-SAR, not to provide
assurance on the internal control structure.
The management of Templeton Income Trust is responsible for establishing and
maintaining an internal control structure. In fulfilling this responsibility,
estimates and judgments by management are required to assess the expected
benefits and related costs of internal control structure policies and
procedures. Two of the objectives of an internal control structure are to
provide management with reasonable, but not absolute, assurance that assets are
safeguarded against loss from unauthorized use or disposition and that
transactions are executed in accordance with management's authorization and
recorded properly to permit preparation of financial statements in conformity
with generally accepted accounting principles.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projection of any evaluation
of the structure to future periods is subject to the risk that it may become
inadequate because of changes in conditions or that the effectiveness of the
design and operation may deteriorate.
Our consideration of the internal control structure would not necessarily
disclose all matters in the internal control structure that might be material
weaknesses under standards established by the American Institute of Certified
Public Accountants. A material weakness is a condition in which the design or
operation of the specific internal control structure elements does not reduce to
a relatively low level the risk that errors or irregularities in amounts that
would be material in relation to the financial statements being audited may
occur and not be detected within a timely period by employees in the normal
course of performing their assigned functions. However, we noted no matters
involving the internal control structure, including procedures for safeguarding
securities, that we consider to be material weaknesses as defined above as of
August 31, 1996.
This report is intended solely for the information and use of management and the
Securities and Exchange Commission.
/s/MCGLADREY & PULLEN, LLP
McGladrey & Pullen, LLP
New York, New York
September 27, 1996
