/bullet/ 406 *P6
406 *PA4
SUPPLEMENT DATED MARCH 23, 1999
TO THE PROSPECTUSES OF
TEMPLETON GLOBAL BOND FUND
TEMPLETON GLOBAL BOND FUND - ADVISOR CLASS
DATED JANUARY 1, 1999
The prospectus is amended as follows:
I. The following paragraph is added to the end of the second paragraph in the
section "Principal Investments," under "Goal and Strategies":
The fund may invest up to 25% of its total assets in debt securities that are
rated below investment grade. Generally, lower rated securities pay higher
yields than more highly rated securities to compensate investors for the higher
risk.
II. The section "Credit" under "Main Risks" is replaced with the following:
CREDIT There is the possibility that an issuer will be unable to make interest
payments or repay principal. Changes in an issuer's financial strength or in a
security's credit rating may affect its value and, thus, impact the value of
fund shares and fund performance. Securities rated below investment grade,
sometimes called "junk bonds," generally have more risk than higher-rated
securities.
III. The section "Management" is replaced with the following:
Templeton Investment Counsel, Inc., (Investment Counsel), 500 East Broward
Blvd., Ft. Lauderdale, FL 33394-3091, through its Templeton Global Bond Managers
division (Global Bond Managers), is the fund's investment manager. Together,
Investment Counsel and its affiliates manage over $217 billion in assets.
A team from Global Bond Managers is responsible for the day-to-day management of
the fund.
The fund pays the manager a fee for managing the fund's assets and making its
investment decisions. For the fiscal year ended August 31, 1998, the fund paid
0.49% of its average daily net assets to the manager.
YEAR 2000 PROBLEM The fund's business operations depend on a worldwide network
of computer systems that contain date fields, including securities trading
systems, securities transfer agent operations and stock market links. Many of
the systems currently use a two digit date field to represent the date, and
unless these systems are changed or modified, they may not be able to
distinguish the Year 1900 from the Year 2000 (commonly referred to as the Year
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2000 problem). In addition, the fact that the Year 2000 is a leap year may
create difficulties for some systems.
When the Year 2000 arrives, the fund's operations could be adversely affected if
the computer systems used by the manager, its service providers and other third
parties it does business with are not Year 2000 ready. For example, the fund's
portfolio and operational areas could be impacted, including securities trade
processing, interest and dividend payments, securities pricing, shareholder
account services, reporting, custody functions and others. The fund could
experience difficulties in effecting transactions if any of its foreign
subcustodians, or if foreign broker-dealers or foreign markets are not ready for
Year 2000.
The fund's manager and its affiliated service providers are making a concerted
effort to take steps they believe are reasonably designed to address their Year
2000 problems. Of course, the fund's ability to reduce the effects of the Year
2000 problem is also very much dependent upon the efforts of third parties over
which the fund and its manager may have no control.
Please keep this supplement for future reference.
