<PAGE> 1
[NORTHERN FUNDS LOGO] . . . MONEY MARKET FUND . . . U.S. GOVERNMENT MONEY
MARKET FUND . . . U.S. GOVERNMENT SELECT MONEY MARKET FUND . . .
MUNICIPAL MONEY MARKET FUND . . . CALIFORNIA MUNICIPAL MONEY MARKET FUND
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ANNUAL REPORT
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[PHOTO]
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March 31, 1999
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<PAGE> 2
TABLE OF CONTENTS
Page
Abbreviations and Other Information..........................................2
Portfolio Commentaries.......................................................3
Money Market Funds
Statements of Assets and Liabilities....................................5
Statements of Operations................................................6
Statements of Changes in Net Assets.....................................7
Financial Highlights....................................................9
Schedules of Investments
Money Market Fund..................................................13
U.S. Government Money Market Fund..................................18
U.S. Government Select Money Market Fund...........................19
Municipal Money Market Fund........................................20
California Municipal Money Market Fund.............................34
Notes to the Financial Statements...........................................38
Report of Independent Public Accountants....................................40
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NOT FDIC-INSURED May lose value No bank guarantee
- -------------------------------------------------------------------------------
An investment in Northern Funds is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other governmental agency. Although the
money market funds seek to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in the Funds.
Shares of Northern Funds are distributed by Northern Funds Distributors, LLC, an
independent third party.
<PAGE> 3
ABBREVIATIONS AND
OTHER INFORMATION
With respect to the Schedules of Investments, the percentage shown for each
investment category reflects the value of investments in that category as a
percentage of total net assets.
Interest rates represent either the stated coupon rate, annualized yield on date
of purchase for discounted notes, or, for floating rate securities, the current
reset rate.
Prerefunding is a procedure in which a bond issuer floats a second bond in order
to pay off the first bond at the first call date. The proceeds from the sale of
the second bond are safely invested, usually in Treasury securities, that will
mature at the first call date of the first bond issue. Those first bonds are
said to be prerefunded after this operation has taken place.
Maturity dates represent the stated date on the security, the next interest
reset date or next puttable dates for floating rate securities or the
prerefunded date for these types of securities.
EXPLANATION OF ABBREVIATIONS USED THROUGHOUT THE SCHEDULES OF INVESTMENTS
AMBAC American Municipal Bond
Assurance Corp.
AMT Alternative Minimum Tax
BAN Bond Anticipation Note
BTP Banker's Trust Partnership
Colld. Collateralized
COP Certificate of Participation
CP Commercial Paper
CVP Central Valley Project
FFCB Federal Farm Credit Bank
FGIC Financial Guaranty
Insurance Corp.
FHA Federal Housing Authority
FHLB Federal Home Loan Bank
FHLMC Freddie Mac
FMC Fidelity Mortgage Corp.
FNMA Fannie Mae
FRN Floating Rate Note
FSA Financial Security Assurance
G.O. General Obligation
GNMA Government National
Mortgage Association
Gtd. Guaranteed
HDA Housing Development Authority
HFA Housing Finance Authority
IDA Industrial Development
Authority
IDR Industrial Development Revenue
LOC Letter of Credit
MBIA Municipal Bond Insurance
Association
MBS Mortgage Backed Securities
ML/SG Merrill Soc Gen
MTN Medium Term Note
P-Floats Puttable Floating Rate Security
PCR Pollution Control Revenue
PSF Permanent School Fund
RAN Revenue Anticipation Note
ROC Reset Option Certificates
SFM Single Family Mortgage
SLMA SLM Holding Corp.
Soc Gen Societe Generale
TAN Tax Anticipation Notes
TOB Tender Option Bond
TOC Tender Option Certificate
TOCR Tender Option Custodial Receipt
TRAN Tax and Revenue
Anticipation Note
TRB Tax Revenue Bonds
VRDN Variable Rate Demand Note
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2
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<PAGE> 4
NORTHERN FUNDS Annual Report
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PORTFOLIO COMMENTARIES
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MONEY MARKET FUND
A defensive strategy was used last year as we anticipated another ease by the
Federal Reserve. The Asian crisis seemed not to affect the U.S. markets as first
thought it would. By the end of the year, things settled down and the domestic
economy remained healthy. There were no significant changes in the composition
of the Fund. The highest percentage of the Fund was invested in Tier One
Commercial Paper where yields were the most attractive. By focusing on short-
and long-maturities, the Fund kept to a barbell strategy trying to anticipate
Federal Reserve moves. As we moved into December, short-term rates were higher
and we began to experience year-end pressure. A barbell structure will be the
investment strategy whenever there is a backup in the market. Issuers are
selected keeping in mind credit quality as the first priority and then yield.
Guidelines are strictly followed. The Fund continues to be one of quality
investments.
In 1999 we will continue to monitor the Federal Reserve moves. At this point,
there is a possibility that interest rates will rise in the beginning of the
second half of the year. However, concerns about Y2K are expected to limit Fed
action as the year draws to a close.
Mary Ann Flynn
Portfolio Manager
U.S. GOVERNMENT
MONEY MARKET FUND
U.S. GOVERNMENT SELECT
MONEY MARKET FUND
In 1998, the Funds adopted a barbell maturity structure focusing on the short-
and long-term ends of the markets. This strategy afforded the Funds the ability
to remain competitive in a lower interest rate environment, while adding yield
and hedging against any move by the Federal Reserve. In the U.S. Government
Money Market Fund, we have substantially increased our exposure to repurchase
agreements both overnight and in the short-term markets. In the U.S. Government
Select Money Market Fund, we invest principally in those government agencies
which are exempt from state and local taxation. Looking ahead, we will maintain
our emphasis on quality, liquidity and yield.
Brian Andersen
Portfolio Manager
MUNICIPAL MONEY MARKET FUND
The Fund performed well for the year, despite a tight supply of short-term
municipal issues and notes. This limited availability hampered our efforts to
extend the Fund's average maturity as far out as we would have liked, given the
Federal Reserve Board's steady interest rate policy. At the end of fiscal 1999,
the Fund's average maturity was slightly shorter than our peer group.
This is a very technical and cyclical market driven by supply and demand
factors. As a result, we will closely watch the supply of short-term securities
and the actions of the Federal Reserve. If interest rates remain stable, we
currently plan to keep our average maturity longer than our peer group by adding
Tier One Commercial Paper, where yields are presently most attractive, and other
short-term tax-exempt securities.
Brad Snyder
Portfolio Manager
CALIFORNIA MUNICIPAL
MONEY MARKET FUND
The Fund outperformed its benchmark for fiscal 1999. However, the supply of
short-term tax-exempt California securities was very limited, causing lower than
normal yields.
During the year, we purchased more commercial paper than in years passed in
order to lengthen the Fund's average maturity in light of the Federal Reserve
Board's steady interest rate course. Looking ahead, we will closely monitor the
actions of the Federal Reserve and evaluate supply factors in the market. If
interest rates remain steady, we expect to keep our average maturity longer than
our peer group.
Brad Snyder
Portfolio Manager
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3
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<PAGE> 5
MONEY MARKET FUNDS YIELD(1) COMPARISONS
AVERAGE MONTHLY RATES
<TABLE>
<CAPTION>
IBC'S
MONEY FUND
AVERAGE(TM)/
CALIFORNIA
STATE-
U.S. GOV'T. CALIFORNIA SPECIFIC
IBC'S U.S. GOV'T IBC'S SELECT IBC'S MUNICIPAL IBC'S MUNICIPAL STOCK
MONEY MONEY FUND MONEY MONEY FUND MONEY MONEY FUND MONEY MONEY FUND MONEY BROKER &
MARKET AVERAGE(TM)/ MARKET AVERAGE(TM)/ MARKET AVERAGE(TM)/ MARKET AVERAGE(TM)/ MARKET GENERAL
FUND ALL TAXABLE FUND GOVERNMENT FUND GOVERNMENT FUND ALL TAX-FREE FUND PURPOSE
- -----------------------------------------------------------------------------------------------------------------------
1999
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
March 4.50% 4.35% 4.46% 4.17% 4.39% 4.17% 2.43% 2.44% 2.36% 2.30%
- -----------------------------------------------------------------------------------------------------------------------
February 4.59% 4.36% 4.48% 4.16% 4.41% 4.16% 2.21% 2.16% 1.96% 2.03%
- -----------------------------------------------------------------------------------------------------------------------
January 4.74% 4.46% 4.54% 4.21% 4.48% 4.21% 2.89% 2.56% 2.60% 2.42%
- -----------------------------------------------------------------------------------------------------------------------
1998
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December 4.77% 4.54% 4.57% 4.28% 4.50% 4.28% 2.93% 2.74% 2.67% 2.61%
- -----------------------------------------------------------------------------------------------------------------------
November 4.85% 4.60% 4.63% 4.35% 4.62% 4.35% 2.79% 2.69% 2.61% 2.55%
- -----------------------------------------------------------------------------------------------------------------------
October 4.96% 4.74% 4.81% 4.49% 4.75% 4.49% 2.95% 2.78% 2.76% 2.63%
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September 5.10% 4.99% 5.06% 4.81% 4.98% 4.81% 3.09% 2.93% 2.78% 2.78%
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August 5.13% 5.01% 5.09% 4.84% 4.99% 4.84% 2.98% 2.79% 2.55% 2.62%
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July 5.13% 5.01% 5.09% 4.84% 5.01% 4.84% 2.99% 3.04% 2.70% 2.92%
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June 5.13% 5.01% 5.09% 4.84% 4.98% 4.84% 3.14% 3.04% 2.94% 2.92%
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May 5.12% 5.00% 5.08% 4.82% 4.99% 4.82% 3.36% 3.23% 3.27% 3.13%
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April 5.12% 5.02% 5.08% 4.85% 5.02% 4.85% 3.40% 3.23% 3.29% 3.13%
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</TABLE>
MONEY MARKET FUNDS 7-DAY YIELDS(1)
PERIOD ENDED MAY 14, 1999
<TABLE>
<CAPTION>
U.S. GOVERNMENT U.S. GOVERNMENT SELECT MUNICIPAL CALIFORNIA MUNICIPAL
MONEY MARKET FUND MONEY MARKET FUND MONEY MARKET FUND MONEY MARKET FUND MONEY MARKET FUND
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Current 4.47% 4.35% 4.28% 2.98% 2.86%
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Effective 4.57% 4.45% 4.37% 3.02% 2.90%
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</TABLE>
(1) Yield calculations reflect fee waivers in effect, represent past
performance and will fluctuate. In the absence of fee waivers, current
7-day yields for the Money Market, U.S. Government Money Market, U.S.
Government Select Money Market, Municipal Money Market and California
Municipal Money Market Funds would have been 4.42%, 4.28%, 4.19%, 2.92% and
2.83%, respectively. An investment in any one of the money market funds is
not insured or guaranteed by the Federal Deposit Insurance Corporation or
any other governmental agency. Although the money market funds seek to
preserve the value of your investment at $1.00 per share, it is possible to
lose money by investing in the Funds.
We compare our Funds to the IBC's Money Fund Averages(TM) which are
composites of professionally managed money market investments with similar
investment objectives.
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4
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<PAGE> 6
NORTHERN FUNDS Annual Report
STATEMENTS OF ASSETS AND LIABILITIES MARCH 31, 1999
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
U.S.
U.S. GOV'T. CALIFORNIA
GOV'T. SELECT MUNICIPAL MUNICIPAL
MONEY MONEY MONEY MONEY MONEY
MARKET MARKET MARKET MARKET MARKET
AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA FUND FUND FUND FUND FUND
- ------------------------------------------- ---------- -------- -------- ---------- --------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments, at amortized cost $4,527,125 $460,094 $420,117 $2,321,774 $357,366
Repurchase agreements, at cost which
approximates market value 335,214 48,564 - - -
Cash 556 1 18 20,500 11
Income receivable 15,743 761 802 14,887 3,130
Receivable for fund shares sold 32,480 4,565 951 34,071 17,357
Receivable for securities sold 45,736 - - 2,675 100
Receivable from Adviser 31 6 6 17 3
Prepaid and other assets 113 27 21 68 12
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Total Assets 4,956,998 514,018 421,915 2,393,992 377,979
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LIABILITIES:
Dividends payable 18,322 1,818 1,653 4,769 691
Payable for fund shares redeemed 18,894 4,120 3,632 - 14,150
Payable for securities purchased 32,480 38,089 - 4,600 -
Accrued administration fees 390 47 34 200 26
Accrued investment advisory fees 317 32 28 151 23
Accrued transfer agent fees 79 8 7 38 6
Accrued custody and accounting fees 30 7 9 25 6
Accrued registration fees and other liabilities 388 31 25 179 27
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Total Liabilities 70,900 44,152 5,388 9,962 14,929
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Net Assets $4,886,098 $469,866 $416,527 $2,384,030 $363,050
===========================================================================================================================
ANALYSIS OF NET ASSETS:
Capital stock $4,885,938 $469,826 $416,503 $2,383,595 $362,999
Accumulated undistributed net investment income 124 33 21 207 20
Accumulated undistributed net realized gains 36 7 3 228 31
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets $4,886,098 $469,866 $416,527 $2,384,030 $363,050
===========================================================================================================================
SHARES OUTSTANDING ($.0001 PAR VALUE, UNLIMITED
AUTHORIZATION) 4,886,058 469,858 416,523 2,383,732 363,018
NET ASSET VALUE, REDEMPTION AND OFFERING PRICE PER SHARE $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
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</TABLE>
See Notes to the Financial Statements.
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5
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<PAGE> 7
STATEMENTS OF OPERATIONS YEAR ENDED MARCH 31, 1999
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
U.S.
U.S. GOV'T. CALIFORNIA
GOV'T. SELECT MUNICIPAL MUNICIPAL
MONEY MONEY MONEY MONEY MONEY
MARKET MARKET MARKET MARKET MARKET
AMOUNTS IN THOUSANDS FUND FUND FUND FUND FUND
- -------------------------------------------------------- -------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest income $209,486 $23,237 $19,138 $70,479 $8,826
- -------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment advisory fees 23,024 2,596 2,176 12,244 1,637
Administration fees 5,756 649 544 3,061 409
Transfer agent fees 3,837 433 363 2,041 273
Custody and accounting fees 844 137 111 479 100
Registration fees 458 37 53 146 10
Professional fees 82 25 24 53 22
Trustees' fees and expenses 64 10 9 37 7
Amortization of organization costs 27 10 6 31 6
Other 192 55 19 115 18
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Total Expenses 34,284 3,952 3,305 18,207 2,482
Less voluntary waivers of:
Investment advisory fees (7,674) (865) (725) (4,081) (546)
Administration fees (3,308) (355) (318) (1,721) (232)
Less reimbursement of expenses by Adviser (2,196) (353) (268) (1,181) (203)
- -------------------------------------------------------------------------------------------------------------------------
Net Expenses 21,106 2,379 1,994 11,224 1,501
- -------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 188,380 20,858 17,144 59,255 7,325
- -------------------------------------------------------------------------------------------------------------------------
NET REALIZED GAINS:
Investments 33 3 3 228 32
- -------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $188,413 $20,861 $17,147 $59,483 $7,357
=========================================================================================================================
</TABLE>
See Notes to the Financial Statements.
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6
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<PAGE> 8
NORTHERN FUNDS Annual Report
STATEMENTS OF CHANGES IN NET ASSETS
Money Market Funds
<TABLE>
<CAPTION>
U.S. GOVERNMENT
MONEY MARKET MONEY MARKET
FUND FUND
----------------------------------- --------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MAR. 31, MAR. 31, MAR. 31, MAR. 31,
AMOUNTS IN THOUSANDS 1999 1998 1999 1998
- ----------------------------------------------- -------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 188,380 $ 123,232 $ 20,858 $ 17,384
Net realized gains on investments 33 3 3 4
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting
from Operations 188,413 123,235 20,861 17,388
- ---------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
Shares sold 14,249,027 11,527,035 2,260,589 1,747,441
Shares from reinvestment of dividends 31,770 15,289 4,881 3,063
Shares redeemed (12,690,762) (9,853,484) (2,212,649) (1,647,725)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting
from Capital Share Transactions 1,590,035 1,688,840 52,821 102,779
- ---------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS PAID:
From net investment income (188,380) (123,232) (20,858) (17,384)
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE IN NET ASSETS 1,590,068 1,688,843 52,824 102,783
NET ASSETS:
Beginning of year 3,296,030 1,607,187 417,042 314,259
- ---------------------------------------------------------------------------------------------------------------------------
End of year $ 4,886,098 $ 3,296,030 $ 469,866 $ 417,042
===========================================================================================================================
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME $ 124 $ 101 $ 33 $ 27
===========================================================================================================================
</TABLE>
See Notes to the Financial Statements.
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7
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<PAGE> 9
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
U.S. GOVERNMENT CALIFORNIA
SELECT MUNICIPAL MUNICIPAL
MONEY MARKET MONEY MARKET MONEY MARKET
FUND FUND FUND
------------------------- -------------------------- ---------------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31,
AMOUNTS IN THOUSANDS 1999 1998 1999 1998 1999 1998
- ------------------------------------- ------------------------- -------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 17,144 $ 11,165 $ 59,255 $ 48,537 $ 7,325 $ 6,740
Net realized gains (losses) on
investments 3 1 228 255 32 (1)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 17,147 11,166 59,483 48,792 7,357 6,739
- ---------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
Shares sold 1,670,254 1,006,456 9,069,717 7,708,423 1,609,467 1,249,341
Shares from reinvestment
of dividends 5,089 3,723 9,443 5,789 1,945 1,007
Shares redeemed (1,565,244) (871,883) (8,509,555) (7,320,165) (1,473,237) (1,226,493)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Capital
Share Transactions 110,099 138,296 569,605 394,047 138,175 23,855
- ---------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS PAID:
From net investment income (17,144) (11,165) (59,255) (48,537) (7,325) (6,740)
From net realized gains - - (146) - - -
- ---------------------------------------------------------------------------------------------------------------------------
Total Distributions Paid (17,144) (11,165) (59,401) (48,537) (7,325) (6,740)
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE IN NET ASSETS 110,102 138,297 569,687 394,302 138,207 23,854
NET ASSETS:
Beginning of year 306,425 168,128 1,814,343 1,420,041 224,843 200,989
- ---------------------------------------------------------------------------------------------------------------------------
End of year $ 416,527 $ 306,425 $ 2,384,030 $ 1,814,343 $ 363,050 $ 224,843
===========================================================================================================================
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME $ 21 $ 14 $ 207 $ 180 $ 20 $ 13
===========================================================================================================================
</TABLE>
See Notes to the Financial Statements.
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8
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<PAGE> 10
NORTHERN FUNDS Annual Report
FINANCIAL HIGHLIGHTS
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
MONEY MARKET
FUND
----------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31,
1999 1998 1997 1996 1995(1)
- ------------------------------------- ----------------------------------------------------------------
SELECTED PER SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from Investment Operations:
Net investment income 0.05 0.05 0.05 0.05 0.04
- ---------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.05) (0.05) (0.05) (0.05) (0.04)
- ---------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF YEAR $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========================================================================================================
TOTAL RETURN(2) 5.04% 5.31% 5.05% 5.57% 4.55%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end
of year $4,886,098 $3,296,030 $1,607,187 $1,061,813 $ 894,279
Ratio to average net assets of(3):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.49% 0.45%
Expenses, before waivers and
reimbursements 0.89% 0.90% 0.90% 0.91% 0.96%
Net investment income, net of
waivers and reimbursements 4.91% 5.19% 4.94% 5.42% 4.94%
Net investment income, before
waivers and reimbursements 4.57% 4.84% 4.59% 5.00% 4.43%
- ---------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the period April 11, 1994 (commencement of operations) through March
31, 1995.
(2) Assumes investment at net asset value at the beginning of the year,
reinvestment of all dividends and distributions, and a complete redemption
of the investment at net asset value at the end of the year. Total return
is not annualized for periods less than one year.
(3) Annualized for periods less than a full year.
See Notes to the Financial Statements.
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9
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<PAGE> 11
FINANCIAL HIGHLIGHTS (CONTINUED)
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
U.S. GOVERNMENT
MONEY MARKET
FUND
--------------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31,
1999 1998 1997 1996 1995(1)
- ------------------------------------------ --------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
Net Asset Value, Beginning of Year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.05 0.05 0.05 0.05 0.04
- ---------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.05) (0.05) (0.05) (0.05) (0.04)
- ---------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=====================================================================================================================
TOTAL RETURN(3) 4.94% 5.22% 4.93% 5.46% 4.47%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of year $469,866 $417,042 $314,259 $207,105 $227,543
Ratio to average net assets of(4):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.49% 0.45%
Expenses, before waivers and
reimbursements 0.91% 0.93% 0.96% 0.94% 1.01%
Net investment income, net of
waivers and reimbursements 4.82% 5.10% 4.82% 5.33% 4.93%
Net investment income, before
waivers and reimbursements 4.46% 4.72% 4.41% 4.88% 4.37%
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the period April 11, 1994 (commencement of operations) through March
31, 1995.
(2) For the period December 12, 1994 (commencement of operations) through March
31, 1995.
(3) Assumes investment at net asset value at the beginning of the year,
reinvestment of all dividends and distributions, and a complete redemption
of the investment at net asset value at the end of the year. Total return
is not annualized for periods less than one year.
(4) Annualized for periods less than a full year.
See Notes to the Financial Statements.
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10
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<PAGE> 12
NORTHERN FUNDS Annual Report
<TABLE>
<CAPTION>
U.S. GOVERNMENT
SELECT MUNICIPAL
MONEY MARKET MONEY MARKET
FUND FUND
- --------------------------------------------------------- ------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED ENDED
MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31,
1999 1998 1997 1996 1995(2) 1999 1998 1997 1996 1995(1)
- --------------------------------------------------------- ------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
0.05 0.05 0.05 0.05 0.02 0.03 0.03 0.03 0.03 0.03
- ---------------------------------------------------------------------------------------------------------------------------
(0.05) (0.05) (0.05) (0.05) (0.02) (0.03) (0.03) (0.03) (0.03) (0.03)
- ---------------------------------------------------------------------------------------------------------------------------
$ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------------------------
4.87% 5.24% 5.07% 5.55% 1.75% 2.98% 3.27% 3.14% 3.54% 2.90%
$416,527 $306,425 $168,128 $85,400 $82,162 $2,384,030 $1,814,343 $1,420,041 $1,102,789 $927,747
0.55% 0.46% 0.40% 0.33% 0.30% 0.55% 0.55% 0.55% 0.49% 0.45%
0.91% 0.93% 0.97% 1.00% 1.32% 0.89% 0.89% 0.90% 0.91% 0.95%
4.73% 5.13% 4.95% 5.43% 5.84% 2.90% 3.20% 3.08% 3.46% 3.10%
4.37% 4.66% 4.38% 4.76% 4.82% 2.56% 2.86% 2.73% 3.04% 2.60%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
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11
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<PAGE> 13
FINANCIAL HIGHLIGHTS (CONTINUED)
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
CALIFORNIA
MUNICIPAL
MONEY MARKET
FUND
------------------------------------------------------------
YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
MAR. 31, MAR. 31, MAR. 31, MAR. 31, MAR. 31,
1999 1998 1997 1996 1995(1)
- -------------------------------------- ------------------------------------------------------------
SELECTED PER SHARE DATA
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.03 0.03 0.03 0.04 0.01
- ------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.03) (0.03) (0.03) (0.04) (0.01)
- ------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF YEAR $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======================================================================================================
TOTAL RETURN(2) 2.75% 3.20% 3.19% 3.63% 1.27%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of year $363,050 $224,843 $200,989 $165,087 $161,316
Ratio to average net assets of(3):
Expenses, net of waivers and
reimbursements 0.55% 0.49% 0.45% 0.39% 0.35%
Expenses, before waivers and
reimbursements 0.91% 0.94% 0.94% 0.94% 1.07%
Net investment income, net of
waivers and reimbursements 2.68% 3.14% 3.13% 3.55% 3.78%
Net investment income, before
waivers and reimbursements 2.32% 2.69% 2.64% 3.00% 3.06%
- ------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the period November 29, 1994 (commencement of operations) through March
31, 1995.
(2) Assumes investment at net asset value at the beginning of the year,
reinvestment of all dividends and distributions, and a complete redemption
of the investment at net asset value at the end of the year. Total return
is not annualized for periods less than one year.
(3) Annualized for periods less than a full year.
See Notes to the Financial Statements.
- -----
12
- -----
<PAGE> 14
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MONEY MARKET FUND
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000S) (000S) (000S) (000S)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CERTIFICATES OF DEPOSIT - 7.4% AUTO MANUFACTURERS - 5.7% (CONT'D.)
Ford Motor Credit Ltd., Canada
Domestic Certificates of Deposit - 1.2% $24,000 5.01%, 6/7/99 $ 23,782
$40,000 Bankers Trust Co., 50,000 5.00%, 6/15/99 49,493
5.75%, 7/1/99 $ 39,996 General Motors Acceptance Corp.
20,000 Huntington National Bank, Columbus, 10,000 5.04%, 5/17/99 9,934
5.01%, 2/8/00 19,998 10,000 5.04%, 5/19/99 9,937
-------- 15,000 5.11%, 6/8/99 14,859
59,994 14,000 5.08%, 6/10/99 13,865
-------- 10,000 5.01%, 6/16/99 9,897
12,000 4.95%, 7/21/99 11,821
FOREIGN CERTIFICATES OF DEPOSIT - 6.2% 20,000 4.99%, 8/17/99 19,625
50,000 Bank of Nova Scotia, New York Branch, Syndicated Loan Funding Trust(1)
5.20%, 2/25/00 49,983 50,000 5.09%, 4/15/99 50,000
25,000 Banque Nationale de Paris, Chicago 35,000 5.19%, 4/15/99 35,000
Branch, 5.23%, 2/25/00 24,993 --------
20,000 Banque Nationale de Paris, New York 277,770
Branch, 5.80%, 4/23/99 19,999 --------
12,500 Banque Nationale de Paris, San Francisco
Branch, 4.95%, 12/14/99 12,499 BANKS - 1.4%
21,000 Canadian Imperial Bank of Commerce, 14,000 KeyCorp, Inc.,
New York Branch, 5.85%, 4/28/99 20,999 5.04%, 6/18/99 13,851
50,000 Commerzbank, New York Branch, Morgan (J.P.) & Co., Inc.
5.08%, 2/8/00 49,990 10,000 4.86%, 5/20/99 9,935
50,000 Royal Bank of Canada, New York 6,110 5.01%, 6/11/99 6,051
Branch, 5.25%, 2/28/00 49,983 40,000 4.87%, 7/26/99 39,388
Societe Generale, New York Branch --------
20,000 5.81%, 4/19/99 19,999 69,225
35,000 5.26%, 2/28/00 34,988 --------
19,500 Swiss Bank,
5.01%, 5/7/99 19,512 BEVERAGES - 2.0%
-------- Coca Cola Enterprises
302,945
-------- 60,950 5.14%, 4/13/99 60,847
2,800 4.93%, 4/27/99 2,790
Total Certificates of Deposit 13,000 4.91%, 5/6/99 12,939
(cost $362,939) 362,939 16,000 4.92%, 5/13/99 15,909
-------- 1,998 4.93%, 5/14/99 1,986
3,500 4.94%, 7/13/99 3,451
COMMERCIAL PAPER - 59.2% --------
97,922
AGRICULTURE - 0.2% --------
10,000 Cargill, Inc.,
4.92%, 4/23/99 9,970 COLLATERALIZED LOAN OBLIGATIONS - 0.7%
-------- 15,000 Centric Capital Corp.,
4.88%, 4/8/99 14,986
AUTO MANUFACTURERS - 5.7% 20,000 Triangle Funding, MBS,
4,600 AESOP Funding Corp., 5.07%, 10/15/99(1) 20,000
4.92%, 4/9/99 4,595 --------
25,000 Chrysler Financial Corp., 34,986
5.03%, 4/12/99 24,962 --------
ELECTRICAL SERVICES - 0.1%
6,224 CSW Credit, Inc.,
4.90%, 4/28/99 6,201
--------
</TABLE>
See Notes to the Financial Statements.
-----
13
-----
<PAGE> 15
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000S) (000S) (000S) (000S)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ELECTRONICS & OTHER ELECTRICAL MACHINES & COMPUTER EQUIPMENT - 0.4%
COMPONENTS - 5.4% $22,000 BTR Finance, Inc.,
$48,000 Johnson Controls, Inc., 5.00%, 8/20/99 $ 21,580
5.20%, 4/1/99 $ 48,000 --------
526 GE Engine Receivables 1995-1 Trust,
4.93%, 4/7/99 526 MANUFACTURING INDUSTRIES - 0.9%
General Electric Capital Corp. HANSON FINANCE (U.K.) PLC
100,000 5.08%, 4/1/99 100,000 7,900 4.94%, 4/14/99 7,886
40,000 5.05%, 5/11/99 39,780 38,000 4.98%, 4/16/99 37,922
74,000 5.02%, 6/16/99 73,236 --------
-------- 45,808
261,542 --------
--------
FOOD - 0.2%
10,000 Diageo PLC, MULTI-SELLER CONDUITS - 7.3%
4.94%, 6/15/99 10,035 25,000 Apreco, Inc.,
-------- 4.92%, 4/27/99 24,912
23,500 Asset Securitization Cooperative,
FOREIGN DEPOSITORY INSTITUTIONS - 6.0% 5.17%, 4/15/99 23,454
35,000 Bank of Scotland, Barton Capital Corp.
4.99%, 6/3/99 34,702 1,365 4.93%, 5/6/99 1,359
50,000 Central Hispano N.A. Capital, 15,000 4.95%, 8/4/99 14,748
5.00%, 6/11/99 49,519 Concord Minutemen Capital Co.
35,000 Credit Communal de Belgique, 47,847 4.90%, 4/9/99 47,795
4.87%, 7/21/99 34,487 25,000 5.00%, 8/20/99 24,522
20,000 Nordbanken N.A., Inc., 75,000 Edison Asset Securitization,
4.97%, 9/30/99 19,510 5.24%, 4/12/99 74,882
45,000 San Paolo U.S. Financial Co., 25,000 International Securitization Corp.,
4.98%, 6/4/99 44,611 5.14%, 4/26/99 24,913
Spintab AB/Swedmortgage Kitty Hawk Funding Corp.
28,200 5.05%, 6/8/99 27,938 9,429 4.93%, 6/3/99 9,348
60,000 5.00%, 9/16/99 58,636 37,500 4.93%, 6/8/99 37,154
22,000 Swedbank, Inc., 10,000 Ness LLC,
4.96%, 7/8/99 21,708 4.96%, 6/24/99 9,886
-------- 8,500 Pooled Account Receivables Corp.,
291,111 4.90%, 4/13/99 8,486
-------- 14,500 Silver Tower U.S. Funding,
5.15%, 5/18/99 14,405
36,668 Variable Funding Capital Corp.,
INSURANCE - 3.9% 5.15%, 4/1/99 36,668
Aetna Service Co. 1,421 Windmill Funding Corp.,
32,500 4.97%, 4/23/99 32,402 4.93%, 5/5/99 1,414
17,500 4.98%, 4/28/99 17,435 --------
22,400 Commoloco, Inc., 353,946
5.00%, 9/3/99 21,935 --------
52,000 SAFECO Corp.,
5.13%, 4/13/99 51,913 NON-DEPOSITORY CREDIT INSTITUTIONS - 3.1%
SAFECO Credit Corp. 35,000 Countrywide Home Loans,
25,000 5.19%, 4/13/99 24,958 4.93%, 4/13/99 34,943
20,000 4.89%, 4/27/99 19,930 5,600 FBA Properties, Inc.,
22,500 5.13%, 5/19/99 22,349 4.99%, 4/15/99 5,589
--------
190,922
--------
</TABLE>
See Notes to the Financial Statements.
- -----
14
- -----
<PAGE> 16
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000S) (000S) (000S) (000S)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NON-DEPOSITORY CREDIT INSTITUTIONS - 3.1%(CONT'D.) SECURITIES ARBITRAGE - 8.6% (CONT'D.)
Finova Capital Corp. $62,500 Grayhawk Funding,
$ 3,000 4.95%, 4/20/99 $ 2,992 4.90%, 5/26/99 $62,036
15,000 4.92%, 4/30/99 14,941 37,000 Intrepid Funding,
50,000 4.94%, 5/21/99 49,663 5.13%, 6/3/99 36,675
10,000 4.91%, 5/28/99 9,924 11,500 Intrepid Funding, Grand Cayman,
12,500 4.92%, 6/4/99 12,392 5.00%, 4/22/99 11,467
10,000 4.98%, 7/9/99 9,856 K2 USA LLC
10,000 4.98%, 7/16/99 9,865 3,800 4.89%, 4/15/99 3,793
--------- 5,000 4.99%, 7/15/99 4,929
150,165 9,500 5.02%, 9/17/99 9,282
--------- 10,000 4.99%, 10/15/99 9,734
50,000 MPF Ltd.,
4.96%, 6/28/99 49,401
NON-DEPOSITORY PERSONAL CREDIT SALTS (III) Cayman Islands Corp.
INSTITUTIONS - 6.6% 26,000 5.50%, 6/12/99 26,000
14,000 Associates Corp. of North America, 10,000 5.44%, 6/18/99 10,000
Canada, 5.28%, 4/6/99 13,990 25,000 5.32%, 7/23/99 25,000
Heller Financial Corp. ---------
20,000 4.99%, 6/24/99 19,770 418,458
24,000 5.01%, 6/28/99 23,710 ---------
Household Finance Corp., Canada
25,000 4.94%, 4/22/99 24,929 SINGLE-SELLER CONDUITS - 2.9%
10,000 4.95%, 5/26/99 9,926 Atlantis One Funding Corp.
Sigma Finance 22,692 4.94%, 6/16/99 22,458
5,000 4.90%, 5/17/99 4,969 33,500 4.97%, 8/24/99 32,843
51,100 4.91%, 5/18/99 50,776 57,000 4.97%, 8/25/99 55,874
37,750 4.90%, 8/4/99 37,123 30,138 CPI Funding,
10,500 4.92%, 8/6/99 10,322 5.06%, 4/26/99 30,035
23,000 4.95%, 8/6/99 22,608 ---------
44,750 4.99%, 8/19/99 43,902 141,210
50,000 4.99%, 8/20/99 49,046 ---------
12,000 4.99%, 9/27/99 11,710 TELEPHONE - 3.8%
--------- 10,000 Cincinnati Bell, Inc.,
322,781 4.96%, 4/5/99 9,995
--------- GTE Corp.
14,000 4.93%, 4/1/99 14,000
SECURITIES ARBITRAGE - 8.6% 45,500 4.93%, 4/8/99 44,922
ABC FUNDING 5,000 4.93%, 4/9/99 4,995
22,200 4.90%, 5/4/99 22,103 25,000 4.93%, 4/19/99 24,930
5,100 4.97%, 8/11/99 5,009 21,500 4.92%, 4/20/99 21,979
21,000 4.98%, 8/16/99 20,610 16,000 4.92%, 4/23/99 15,961
22,000 4.98%, 9/22/99 21,483 20,100 4.93%, 4/27/99 20,029
5,150 5.00%, 9/22/99 5,029 10,500 4.92%, 4/28/99 10,461
37,500 Centauri Corp., 17,000 4.92%, 4/30/99 16,933
5.01%, 9/13/99 36,661 ---------
11,790 Conduit Asset Backed Security, 184,205
4.96%, 6/22/99 11,658 ---------
Giro Funding Corp. Total Commercial Paper
35,000 4.89%, 4/5/99 34,981 (cost $2,887,837) 2,887,837
12,654 4.92%, 4/28/99 12,607 ---------
</TABLE>
-----
15
-----
<PAGE> 17
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000S) (000S) (000S) (000S)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CORPORATE BONDS - 6.8% EURODOLLAR TIME DEPOSITS - 9.2% (CONT'D.)
$ 2,000 Abbey National PLC MTN, $112,000 Credit Suisse First Boston, Grand Cayman,
5.02%, 7/27/99 $ 2,004 5.125%, 4/1/99 $112,000
1,000 American Express Centurion Bank FRN, 130,000 Firstar Bank, Grand Cayman,
5.04%, 4/12/99 1,000 5.19%, 4/1/99 130,000
50,000 Associates First Capital Corp. FRN, ---------
5.00%, 4/5/99 50,000
25,000 Bear Stearns Cos., Inc., FRN, Total Eurodollar Time Deposits
5.26%, 4/6/99 25,001 (cost $452,000) 452,000
10,000 Beneficial Corp. FRN, ---------
5.07%, 6/23/99 10,001
5,000 Chrysler Financial Corp., INSURANCE FUNDING
6.28%, 6/22/99 5,012 AGREEMENTS - 3.4%
57,500 CIT Group, Inc. FRN,
4.83%, 4/1/99 57,461 50,000 General American Life Insurance Co.,
25,000 Countrywide Home Loan FRN, 5.14%, 4/23/99 50,000
4.98%, 5/4/99 24,996 20,000 Integrity Life Insurance Co.,
General Motors Acceptance Corp. FRN 5.28%, 4/7/99 20,000
12,500 4.90%, 6/11/99 12,498 50,000 Life Insurance Co. of Virginia,
2,150 5.03%, 12/9/99 2,149 5.01%, 4/1/99 50,000
40,000 Heller Financial Corp. FRN, Transamerica Life Insurance & Annuity Co.
5.57%, 11/15/99 40,048 20,000 4.96%, 4/7/99 20,000
12,000 Household Finance Corp. FRN, 25,000 5.05%, 4/7/99 25,000
5.16%, 4/14/99 12,000 ---------
9,000 Hydro-Quebec Corp., Quebec, Canada,
5.76%, 4/1/99 9,000 Total Insurance Funding Agreements
25,000 Liberty Light U.S. Capital Medium (cost $165,000) 165,000
Term FRN, 5.04%, 4/8/99(1) 24,987 ---------
30,000 Penney (J.C.) & Co., Inc.,
5.06%, 4/23/99 29,909 MUNICIPAL INVESTMENTS - 6.7%
25,000 Transamerica Financial Corp. FRN,
Series E, 5.22%, 4/22/99 25,000 3,000 1800 Harrison Foundation VRDN,
750 USL Capital Corp. Medium Term FRN, Series 99-A, 5.00%, 4/7/99(1) 3,000
Series D, 5.14%, 4/19/99 750 4,000 ADE Investments LLC VRDN, Series A
--------- (First of America LOC),
4.92%, 4/1/99 4,000
Total Corporate Bonds 17,000 Alaska Housing Finance Corp.,
(cost $331,816) 331,816 4.96%, 6/11/99 16,836
--------- 4,900 Courtyards of Mackinaw LLC FRN, Series A
(First of America LOC),
EURODOLLAR TIME DEPOSITS - 9.2% 4.88%, 4/1/99 4,900
5,000 Elsmere, Kentucky Mubea, Inc.,
135,000 Bank Austria Aktiengesellschaft, Vienna, 4.95%, 4/7/99 5,000
5.50%, 4/1/99 135,000 13,800 Flint, Michigan, Hospital Building
75,000 Branch Bank & Trust Co., Grand Cayman, Authority Revenue Refunding VRDN,
5.19%, 4/1/99 75,000 Series A, Hurley Medical (NBD Bank LOC),
5.62%, 4/7/99 13,800
11,400 Healthcare Network Properties,
4.89%, 4/7/99 11,400
15,020 Integris Health, Inc.,
5.69%, 4/7/99 15,020
</TABLE>
See Notes to the Financial Statements.
- -----
16
- -----
<PAGE> 18
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MONEY MARKET FUND(CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MUNICIPAL INVESTMENTS - 6.7% (CONT'D.) REPURCHASE AGREEMENT - 6.8%
$17,100 Johnson City Medical Center FRN
(MBIA Insured), 4.93%, 4/7/99 $17,100 $335,214 Lehman Brothers, Inc., dated 3/31/99,
3,085 KBL Capital Fund, Inc. Loan Program FRN, repurchase price $335,250 (Colld. by
Series 98-B (First of America LOC), U.S. Government Securities),
4.92%, 4/7/99(1) 3,085 5.15%, 4/1/99
30,000 Los Angeles County, California, (cost $335,214) $335,214
Pension Obligation Floating Rate TOCR, -----------
Series A (AMBAC Insured), 4.99%, 4/7/99 30,000
4,500 Malone College Project, Total Investments - 99.5%
4.94%, 4/7/99 4,500 (cost $4,862,339) 4,862,339
Municipal Electric Authority of Georgia
BAN
8,431 5.17%, 4/9/99 8,431 Other Assets less Liabilities - 0.5% 23,759
1,000 4.90%, 6/24/99 1,000 -----------
12,500 New Jersey Economic Development NET ASSETS - 100.0% $4,886,098
Authority Revenue Refunding Bonds, ===========
Series B, MSNBC/CNBC
(Chase Manhattan Bank LOC),
5.64%, 4/1/99 12,500
18,600 Physicians Plus Medical Group VRDN,
Series 1996 (M&I Bank LOC),
5.00%, 4/1/99 18,600 (1) Securities exempt from registration under Rule 144A of
5,300 Schreiber Industrial Park-North Co., the Securities Act of 1933. These securities may be
Virginia, 4.95%, 4/7/99 5,300 resold in transactions exempt from registration,
9,360 Seattle, Washington, G.O. VRDN, normally to qualified institutional buyers. At March
Series C (Credit Communal de Belgique 31, 1999, the value of those securities amounted to
LOC), 4.90%, 4/7/99 9,360 approximately $176,073,000 or 3.6% of net assets.
9,690 Stanislaus County, California,
Pension Obligation Revenue Refunding
Bonds (MBIA Insured), 5.07%, 4/1/99 9,690
10,045 Texas State Veterans Housing Fund II G.O.
Bonds, 5.07%, 4/1/99 10,045
75,000 United Health Care Corp.,
5.65%, 12/1/99(1) 75,001
Virginia State HDA Mortgage
Revenue Bonds
9,265 4.95%, 4/1/99 9,265
12,745 5.07%, 4/1/99 12,745
23,855 4.99%, 4/7/99 23,855
3,100 Waukesha, Wisconsin, Health System, Inc.
VRDN, 5.00%, 4/7/99 3,100
-----------
Total Municipal Investments
(cost $327,533) $327,533
-----------
</TABLE>
See Notes to the Financial Statements.
-----
17
-----
<PAGE> 19
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
U.S. GOVERNMENT MONEY MARKET FUND
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
U.S. GOVERNMENT AGENCIES - 97.9% FREDDIE MAC - 51.6% (CONT'D.)
$15,000 4.75%, 5/20/99 $14,903
FANNIE MAE - 24.9% 25,000 4.78%, 5/25/99 24,821
FNMA Bond, 25,000 4.76%, 6/11/99 24,765
$ 4,000 5.49%, 8/3/99 $ 3,999 10,000 4.81%, 3/2/00 9,551
FNMA Discount MBS ----------
28,558 4.80%, 7/1/99 28,211 242,281
10,000 4.83%, 7/1/99 9,878 ----------
FNMA Discount Notes OVERSEAS PRIVATE INVESTMENT CORP. - 3.8%
14,000 4.91%, 4/20/99 13,964 18,000 Floating Rate Notes, 5.00%, 4/7/99 18,000
22,000 4.88%, 4/29/99 21,917 ----------
25,000 4.80%, 5/13/99 24,860
14,500 4.72%, 8/10/99 14,251 Total U.S. Government Agencies
---------- (cost $460,094) 460,094
117,080 ----------
----------
FEDERAL AGRICULTURE MORTGAGE CORP. - 6.4% REPURCHASE AGREEMENTS - 10.4%
30,285 Farmer Mac Discount Note,
4.80%, 4/20/99 30,208 20,000 ABN-AMRO, dated 3/31/99, repurchase
---------- price $28,568 (Colld. by U.S. Government
Securities), 5.15%, 4/1/99 20,000
FEDERAL HOME LOAN BANK - 11.2% 28,564 Lehman Brothers, Inc., dated 3/31/99,
FHLB Bonds repurchase price $20,003 (Colld. by U.S.
4,000 5.61%, 4/8/99 4,000 Government Securities), 5.07%, 4/1/99 28,564
8,000 5.63%, 5/5/99 7,999 ----------
4,000 5.53%, 6/10/99 3,999
8,000 5.54%, 7/13/99 7,999 Total Repurchase Agreements
4,000 5.54%, 7/15/99 3,999 (cost $48,564) 48,564
5,000 5.16%, 3/22/00 5,000 ----------
FHLB Discount Notes
10,000 4.75%, 5/19/99 9,937 Total Investments - 108.3%
10,000 4.80%, 2/1/00 9,592 (cost $508,658) 508,658
----------
52,525
---------- Liabilities less Other Assets - (8.3)% (38,792)
----------
FREDDIE MAC - 51.6% NET ASSETS - 100.0% $469,866
FHLMC BOND, ==========
4,000 5.54%, 8/13/99 3,999
FHLMC Discount Notes
10,320 4.90%, 4/5/99 10,315
27,000 4.92%, 4/5/99 26,985
20,000 4.88%, 4/9/99 19,978
13,000 4.89%, 4/9/99 12,986
23,447 4.91%, 4/9/99 23,421
5,225 4.78%, 4/12/99 5,217
23,144 4.76%, 4/14/99 23,104
20,000 4.76%, 4/22/99 19,945
22,400 4.85%, 5/7/99 22,291
</TABLE>
See Notes to the Financial Statements.
- -----
18
- -----
<PAGE> 20
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
U.S. GOVERNMENT SELECT MONEY MARKET FUND
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
- --------------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT AGENCIES - 100.9%
Federal Farm Credit Bank - 5.0%
FFCB Discount Notes
$20,000 4.60%, 5/3/99 $19,997
925 5.60%, 5/3/99 925
---------
20,922
---------
FEDERAL HOME LOAN BANK - 95.9%
FHLB Bonds
6,000 5.61%, 4/8/99 6,000
9,000 5.63%, 5/5/99 8,999
6,000 5.53%, 6/10/99 5,998
6,000 5.54%, 7/15/99 5,999
25,000 5.16%, 3/8/00 24,991
FHLB Discount Notes
67,910 4.80%, 4/1/99 67,910
10,000 4.74%, 4/7/99 9,992
11,398 4.76%, 4/7/99 11,389
25,000 4.75%, 4/9/99 24,974
6,979 4.76%, 4/9/99 6,972
15,000 4.75%, 5/12/99 14,919
23,300 4.82%, 5/12/99 23,172
10,000 4.75%, 5/14/99 9,943
50,000 4.74%, 5/19/99 49,684
25,000 4.74%, 5/21/99 24,835
8,000 4.75%, 5/21/99 7,947
11,756 4.75%, 6/2/99 11,660
10,000 4.81%, 6/2/99 9,917
23,000 4.78%, 6/30/99 22,725
27,000 4.67%, 7/2/99 26,678
25,000 4.79%, 9/1/99 24,491
---------
399,195
---------
Total U.S. Government Agencies
(cost $420,117) 420,117
---------
TOTAL INVESTMENTS - 100.9%
(cost $420,117) 420,117
Liabilities less Other Assets - (0.9)% (3,590)
---------
NET ASSETS - 100.0% $416,527
=========
</TABLE>
See Notes to the Financial Statements.
-----
19
-----
<PAGE> 21
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET FUND
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MUNICIPAL INVESTMENTS - 96.6% ARIZONA - 1.2% (CONT'D.)
$1,250 Apache County IDR VRDN (AMT),
ALABAMA - 0.6% Imperial Components, Inc. Project (Harris
$1,800 Ashland City Industrial Development Trust & Savings Bank LOC),
Board IDR VRDN (AMT), Russell Corp. 3.15%, 4/7/99 $1,250
Project (SunTrust Banks LOC), 7,800 Cochise County PCR VRDN Solid Waste
3.20%, 4/7/99 $1,800 Disposal, Series A (AMT), Arizona Electric
2,575 Columbia City Industrial Development Power Project, 2.90%, 9/1/99 7,800
Board IDR VRDN (AMT), Russell Corp. 7,980 Maricopa County PCR Refunding VRDN,
Project (SunTrust Banks LOC), Series F, Arizona Public Services Co.
3.20%, 4/7/99 2,575 (BankAmerica Corp., LOC),
2,575 Geneva County Industrial Development 3.05%, 4/1/99 7,980
Board IDR VRDN (AMT), Russell Corp. 7,000 Salt River Agricultural Project Bonds,
Project (SunTrust Banks LOC), 2.95%, 5/13/99 7,000
3.20%, 4/7/99 2,575 1,860 Tempe G.O. Bond, Series A,
700 Greenville City IDR VRDN, 5.50%, 7/1/99 1,872
Allied-Signal Project (FMC Corp. Gtd.), ---------
3.10%, 4/7/99 700 28,412
3,100 McIntosh City Industrial Development ---------
Board Environmental Improvement Revenue ARKANSAS - 0.5%
Refunding Bond, Series E (AMT), Ciba 6,045 Arkansas State Development Financing
Specialty Chemical Corp., Authority Home Mortgage Revenue Bond,
3.35%, 4/1/99 3,100 Series PT-257 (AMT), 3.10%, 1/13/00 6,045
2,400 Selma City IDR VRDN, Series A, 3,250 Lowell City IDR VRDN (AMT), Little Rock
Meadowcraft, Inc. Project (NationsBank Newspapers, Inc. Project (Bank of New
LOC), 3.15%, 4/7/99 2,400 York LOC), 3.10%, 4/7/99 3,250
1,000 Stevenson Industrial Development Board 2,050 West Memphis City IDR VRDN (AMT),
Environmental Improvement Revenue Bond Proform Co. LLC Project (First Bank LOC),
(AMT), Mead Corp. Project (Soc Gen LOC), 3.25%, 4/7/99 2,050
3.15%, 4/1/99 1,000 ---------
--------- 11,345
14,150 ---------
---------
CALIFORNIA - 0.5%
ALASKA - 0.6% California State G.O. Bond (FGIC Insured)
7,730 ALASKA HOUSING FINANCE CORP., 800 Series 5027C, 2.91%, 4/7/99 800
Series PT-37, Merrill P-Floats (Banque 200 Series CR-52, 2.91%, 4/7/99 200
Nationale de Paris LOC), 2.95%, 4/1/99 7,730 11,200 Irvine Ranch County Consolidated Water
7,000 Valdez Marine Terminal Revenue Refunding Districts 2, 102, 103, 106, 203 & 206
VRDN, Series A, Arco Transportation Project, VRDN, Series B (Morgan Guaranty Trust
2.80%, 5/14/99 7,000 LOC), 3.00%, 4/1/99 11,200
--------- ---------
14,730 12,200
--------- ---------
ARIZONA - 1.2% COLORADO - 1.3%
2,500 Arizona School District TAN Financing 7,038 Arapahoe County Capital Improvements
Program COP, Series B, TOB, Series E BTP-255, Project E-470,
4.20%, 7/30/99 2,510 3.20%, 4/7/99 7,038
4,000 Colorado HFA VRDN (AMT), Metal Sales
Manufacturing Corp. Project (Firstar Bank
LOC), 3.20%, 4/7/99 4,000
</TABLE>
See Notes to the Financial Statements.
- -----
20
- -----
<PAGE> 22
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
COLORADO - 1.3% (CONT'D.) FLORIDA - 3.3% (CONT'D.)
$ 9,900 Colorado HFA SFM VRDN, Series C-1 $ 6,595 Florida State Board of Education Capital
(AMT), 3.16%, 4/7/99 9,900 Outlay TOB VRDN, Series B, BTP-233,
8,555 Colorado Student Obligation Bond 3.25%, 4/7/99 6,595
Authority, Series A, 3.15%, 4/7/99 8,555 16,900 Florida State Board of Education VRDN,
2,000 Pitkin County IDR, Series B (AMT), Series 1993E, Eagle Trust,
Aspen Skiing Project (Bank One 3.11%, 4/7/99 6,900
LOC), 3.25%, 4/1/99 2,000 4,400 Florida State Housing Financing Agency,
--------- Series 2 (AMT) (MBIA Insured), 3.15%,
31,493 4/7/99 4,400
--------- 7,145 Hillsborough County School Board COP,
Weekly Option Period, Series 4,
DELAWARE - 0.2% 3.21%, 4/7/99 7,145
3,200 Delaware State Economic Development 4,800 Jacksonville PCR Refunding Bonds,
Authority IDR VRDN, Series 1998 (AMT), Series 19, Florida Power & Light Project,
C&C Family L.P. (PNC Bank LOC), 2.95%, 6/10/99 4,800
3.25%, 4/7/99 3,200 2,000 Ocean Highway & Port Authority Revenue
1,325 Delaware State Economic Development Bonds (AMT) (ABN-AMRO LOC),
Authority PCR VRDN, Allied-Signal Corp. 2.95%, 4/7/99 2,000
Project (FMC Gtd.), 3.10%, 4/7/99 1,325 4,480 Orange County HFA, Series 1987-A,
--------- Citicorp Eagle Trust, 3.11%, 4/7/99 4,480
4,525 5,010 Sunshine State Government Financing
--------- Authority Revenue Notes, Series A,
DISTRICT OF COLUMBIA - 2.1% Government Finance Program,
District of Columbia Metropolitan Airport 3.20%, 6/11/99 5,010
Authority Revenue TOB 16,990 Sunshine State Government Financing
6,675 Series BTP-311 (AMT), Commission Revenue VRDN
3.20%, 4/7/99 6,675 (AMBAC Insured), 2.80%, 6/11/99 16,990
6,745 Series BTP-312 (AMT), ---------
3.20%, 4/7/99 6,745 78,445
29,500 District of Columbia Metropolitan Airport ---------
Authority, Passenger Facility Flexible
Term Note (AMT) (NationsBank LOC), GEORGIA - 3.1%
2.80%, 5/14/99 29,500 8,400 Atlanta City Metropolitan Rapid Transit
6,000 District of Columbia Revenue Bonds, Authority Sales Tax Revenue VRDN, Series A,
Lowell School, Inc. Project (First Union Municipal Trust Certificates, Class A
National Bank LOC), 3.10%, 4/7/99 6,000 (MBIA Insured), 3.21%, 4/7/99 8,400
--------- 3,600 Bartow County Development Authority
48,920 PCR Bonds, Series 2 (AMT), Georgia Power
--------- Co. Bowen Project, 3.35%, 4/1/99 3,600
8,600 Burke County Development Authority
FLORIDA - 3.3% PCR (AMT), Georgia Power Co. Vogtle
4,000 ABN-AMRO MuniTops (ABN-AMRO LOC), Project, 3.15%, 4/1/99 8,600
Florida Board of Education Capital Outlay 3,000 Clayton County Housing Authority
Revenue Bonds, 3.14%, 4/7/99 4,000 Revenue VRDN (AMT), Williamsburg South
2,000 Dade County IDA Revenue VRDN (AMT), Apartments Project (PNC Bank LOC),
Fine Art Lamps Project, (SunTrust 3.20%, 4/7/99 3,000
Banks LOC), 2.85%, 4/7/99 2,000 5,300 Clayton County IDR VRDN (AMT),
4,125 Duval County HFA Mortgage Revenue Blue Circle Aggregates, Inc. Project
VRDN, Series 3A (AMT), Clipper Trust (Denmark Danske Bank LOC),
Certificate, 3.21%, 4/7/99 4,125 3.10%, 4/7/99 5,300
</TABLE>
See Notes to the Financial Statements.
-----
21
-----
<PAGE> 23
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GEORGIA - 3.1% (CONT'D.) ILLINOIS - 10.9%
$ 5,200 DeKalb County Housing Authority $3,500 Arlington Heights IDR VRDN, Series 1997
Revenue VRDN, Series 1995 (AMT), Cedar (AMT), 3E Graphics and Printing Project
Creek Apartment Project (General Electric (Harris Trust & Savings Bank LOC),
Capital Corp. LOC), 3.20%, 4/7/99 $5,200 3.15%, 4/7/99 $3,500
4,600 Fulton County Development Authority 9,580 Aurora City Rental Housing Revenue Bonds,
IDR (AMT), Geiger International, Inc. Series PA-328, Fox Valley Project (Merrill
Project (NationsBank LOC), Lynch Gtd.), 3.12%, 4/7/99 9,580
3.10%, 4/7/99 4,600 7,000 Bolingbrook Multi-Family Housing
10,000 Fulton County G.O. Bonds, Series 9, Redevelopment Revenue Refunding VRDN,
Citicorp Eagle Trust, 3.10%, 8/2/99 10,000 Amberton, Series A (LaSalle National Bank
Georgia HFA Conventional Mortgage TOB, LOC), 3.10%, 4/7/99 7,000
Mortgage License (AMT) (FHA Insured) 14,000 Chicago City G.O. Bonds,
2,260 Series C, 3.20%, 6/1/99 2,260 Citicorp Eagle Trust (FSA Insured),
1,115 Series D, 3.20%, 6/1/99 1,115 2.85%, 10/28/99 14,000
6,745 Georgia State G.O. Tender Option COP, 2,655 Chicago City IDR, Series B (AMT),
Series BPT-210, 3.20%, 4/7/99 6,745 Guernsey Bel, Inc. Project (LaSalle National
1,800 Gwinett County IDR, Series 1998 (AMT), Bank LOC), 3.15%, 4/7/99 2,655
Network Publications, Inc. (NationsBank 9,495 Chicago City Public Building Commission,
LOC), 3.10%, 4/7/99 1,800 Series A PA-155, P-Floats (MBIA Insured),
4,150 Henry County Development Authority 3.10%, 10/21/99 9,495
Revenue Bonds, Series 1997 (AMT), Atlas 3,885 Chicago City Sales TRB, Weekly Option
Roofing Corp. Project (SunTrust Banks Period, Series PCR-8, 3.16%, 4/7/99 3,885
LOC), 3.20%, 4/7/99 4,150 10,000 Chicago City VRDN Certificates, Series M,
1,750 Richmond County Board of Education 3.70%, 8/4/99 10,000
G.O. Bond (State Aid Withholding), Chicago Midway Airport Revenue VRDN,
4.00%, 9/1/99 1,754 Second Lien (AMT) (MBIA Insured)
5,000 Savannah City Economic Development 9,300 Series A, 3.20%, 4/1/99 9,300
Authority Revenue VRDN, Series 1997 13,300 Series B, 3.20%, 4/1/99 13,300
(AMT), Kaolin Terminals Project 5,500 Chicago Midway Airport Revenue VRDN,
(NationsBank LOC), 3.10%, 4/7/99 5,000 Series 1995 (AMT), American Trans Air, Inc.
2,000 Whitfield County IDA Revenue VRDN, Project (NBD Bank LOC), 3.15%, 4/7/99 5,500
Series 1998 (AMT), H&S Whitting, Inc. 2,400 Chicago O'Hare International Airport
Project (NationsBank LOC), Revenue VRDN, Series A (AMT)
3.10%, 4/7/99 2,000 (Bayerische Landesbank LOC),
---------- 3.10%, 4/7/99 2,400
73,524 4,150 Crestwood IDR Bond, GMG Warehouse LLC
---------- Project (LaSalle National Bank LOC),
3.09%, 4/7/99 4,150
HAWAII - 0.6% 1,730 Des Plaines City IDR VRDN, Series 1996
5,000 Hawaii State Department of Budget & (AMT), Finzer Roller, Inc. Project (Harris
Finance, Series A (AMT), Hawaiian Electric Trust & Savings Bank LOC),
Co. Project (MBIA Insured), 3.15%, 4/7/99 1,730
3.12%, 4/7/99 5,000 12,400 Dupage County Water Commission Water
9,965 Hawaii State HFA SFM P-Floats, Revenue Bonds, Citicorp Eagle Trust,
Series PT-1049, 3.12%, 4/7/99 9,965 3.11%, 4/7/99 12,400
----------
14,965
----------
</TABLE>
See Notes to the Financial Statements.
- -----
22
- -----
<PAGE> 24
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ILLINOIS - 10.9% (CONT'D.) ILLINOIS - 10.9% (CONT'D.)
$3,550 Frankfort City IDR, Series 1996 (AMT), $5,000 Illinois Educational Facilities Authority
Bimba Manufacturing Co. Project (Harris VRDN, University of Chicago,
Trust & Savings Bank LOC), 3.11%, 4/7/99 $5,000
3.15%, 4/7/99 $3,550 5,480 Illinois Housing Development Authority VRDN,
4,625 Fulton County IDR VRDN, Series 1998 (AMT), Subseries A-2 (AMT), Homeowner Mortgage,
Drives, Inc. Project (Harris Trust & 3.10%, 1/20/00 5,480
Savings Bank LOC), 3.15%, 4/7/99 4,625 3,000 Illinois State Unlimited G.O. Bond,
650 Illinois Development Financing Authority 5.60%, 6/1/99 3,010
Economic Development Revenue VRDN, 15,875 Illinois State ROC, Series 39,
D.E. Akin Seed Project (Bank One LOC), 3.16%, 4/7/99 15,875
3.20%, 4/7/99 650 7,500 Ladd Village IDR VRDN, Series 1996 (AMT),
2,460 Illinois Development Financing Authority O'Neal Metals, Inc. Project (NationsBank
IDR VRDN (AMT), Bimba Manufacturing LOC), 3.15%, 4/7/99 7,500
Co. Project (Harris Trust & Savings Bank 19,806 Metropolitan Pier & Exposition Authority
LOC), 3.15%, 4/7/99 2,460 Dedicated State Tax Revenue TOC,
4,100 Illinois Development Financing Authority Series BTP-230-A, 3.20%, 4/7/99 19,806
VRDN, Series 1997 (AMT), Ciccone Food 3,560 Metropolitan Pier & Exposition Authority
Products Project (Harris Trust & Savings VRDN, Series 1996 A, McCormick Place Project
Bank LOC), 3.15%, 4/7/99 4,100 (AMBAC Insured), 3.10%, 4/7/99 3,560
2,265 Illinois Development Financing Authority 1,575 Naperville G.O. Bonds, Series A,
IDR VRDN, Series A (AMT), Randall 4.00%, 12/1/99 1,584
Metals Corp. Project (LaSalle National 2,950 Niles Village IDR VRDN, Series 1996 (AMT),
Bank LOC), 3.30%, 4/7/99 2,265 Lewis Spring & Manufacturing Co. Project
4,600 Illinois Development Financing Authority (Harris Trust & Savings Bank LOC),
IDR VRDN (AMT), Touhy LP Project (LaSalle 3.15%, 4/7/99 2,950
National Bank LOC), 3.09%, 4/7/99 4,600 7,900 Palos Hills Multifamily Housing VRDN,
5,950 Illinois Development Financing Authority Series 1998 (AMT), Green Oaks Project
Revenue VRDN, Enterprise Office Project (LaSalle National Bank LOC),
(Mid America Federal Savings LOC), 3.09%, 4/7/99 7,900
3.15%, 6/1/99 5,950 2,700 Rockford City IDR, Series 1998 (AMT),
5,500 Illinois Development Financing Authority Ring Can Corp. Project (SunTrust Banks
Revenue VRDN (AMT), Flying Food Fare, LOC), 3.20%, 4/7/99 2,700
Inc. Project (BankAmerica Corp. LOC), 2,250 Romeoville City IDR, Series 1997 (AMT),
3.15%, 4/7/99 5,500 Metropolitan Industries, Inc. Project
4,160 Illinois Development Financing Authority (Harris Trust & Savings Bank LOC),
Revenue VRDN (AMT), Olive Can Co. 3.15%, 4/7/99 2,250
Project (LaSalle National Bank LOC), 6,000 Savanna City IDR VRDN, Series 1994
3.09%, 4/7/99 4,160 (AMT), Metform Corp. Project
4,800 Illinois Educational Facilities Authority (Bank One LOC),
VRDN, National College of Education 3.05%, 4/7/99 6,000
(Harris Trust & Savings Bank LOC), 5,800 St. Clair County IDR VRDN (AMT), Stellar
3.05%, 4/7/99 4,800 Manufacturing Project (NationsBank LOC),
3.15%, 4/7/99 5,800
</TABLE>
See Notes to the Financial Statements.
-----
23
-----
<PAGE> 25
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ILLINOIS - 10.9% (CONT'D.) IOWA - 1.5% (CONT'D.)
$9,100 Will County Multi-Family Housing $10,100 Iowa Financing Authority Waste Disposal
Redevelopment Revenue Bonds, Woodlands Revenue VRDN, Series 1998 A (AMT),
Crest Hill (LaSalle National Bank LOC), Cedar River Paper Co. Project (Union
3.09%, 4/7/99 $9,100 Bank of Switzerland LOC),
9,000 Will County Solid Waste Disposal Revenue 3.35%, 4/1/99 $10,100
Bond (AMT), BASF Corp. Project, ----------
3.35%, 4/1/99 9,000 34,770
---------- ----------
259,070 KANSAS - 1.4%
---------- 8,500 Douglas County G.O. Temporary Notes,
INDIANA - 1.4% Series 3, 3.75%, 8/1/99 8,501
2,790 Anderson City Economic Development 6,975 Kansas City Leavenworth & Lenexa
VRDN, Series 1996 (AMT), Gateway Village Mortgage Revenue FRN, Series A-31,
Project (FHLB LOC), 3.15%, 4/7/99 2,790 3.15%, 4/7/99 6,975
1,500 Greencastle City IDR VRDN, Series 1996 1,000 Olathe IDR VRDN Bond, Series A (AMT),
(AMT), Crown Equipment Corp. Project Diamant Boart, Inc. Project (Deutsche
(Mellon Bank LOC), 3.25%, 4/7/99 1,500 Bank A.G. LOC), 3.15%, 4/7/99 1,000
2,840 Hammond City Economic Development 14,735 Wichita G.O. Temporary Notes, Series 198,
VRDN, Series 1996 A (AMT), Annex at 3.50%, 8/26/99 14,761
Douglas Point Project (FHLB LOC), 1,980 Wichita Water & Sewer Utilities Revenue
3.15%, 4/7/99 2,840 Bonds, 6.50%, 10/1/99 2,016
Indiana Development Financing Authority ----------
IDR VRDN (AMT), Red Gold, Inc. Project 33,253
(Harris Trust & Savings Bank LOC) ----------
4,600 Series 1994 A, 3.15%, 4/7/99 4,600
2,900 Series 1994 B, 3.15%, 4/7/99 2,900 KENTUCKY - 2.3%
17,000 Indiana Transportation Authority Highway 5,701 Carroll County Solid Waste Disposal
Revenue Bonds, Citicorp Eagle Trust, Revenue VRDN (AMT), North American
3.10%, 8/2/99 17,000 Stainless Project (Banco Bilbao Vizcaya
2,000 Jasper County PCR, Series 1988-D, LOC), 3.55%, 4/7/99 5,701
Northern Indiana Public Service Project, 3,030 Clark County Industrial Building IDR
2.95%, 6/9/99 2,000 VRDN, Series 1996 (AMT), Bluegrass Art
---------- Cast Project (Bank One LOC),
33,630 3.20%, 4/7/99 3,030
---------- Daviess County Waste Disposal Facilities
IOWA - 1.5% IDR VRDN (AMT), Scott Paper Co.
7,580 Cedar Rapids City G.O. Unlimited Bond, Project (Kimberly-Clark Corp. Gtd.)
PA-251, 3.07%, 4/7/99 7,580 9,400 Series 1993 A, 3.15%, 4/1/99 9,400
12,590 Iowa Financing Authority SFM Program 5,500 Series 1994 A, 3.15%, 4/1/99 5,500
Bonds, Series B (AMT) (GNMA/FNMA 8,535 Kentucky Economic Development Financing
Insured), 2.96%, 2/23/00 12,590 Authority Hospital Facilities Revenue VRDN,
4,500 Iowa Financing Authority Waste Disposal Series B, Baptist Healthcare,
Revenue VRDN, Series 1997 A (AMT), Cedar 3.05%, 4/7/99 8,535
River Paper Co. Project (Bank of Nova Scotia 6,000 Kentucky Housing Corp., Housing Revenue
LOC), 3.35%, 4/1/99 4,500 Bonds, Series C (AMT), 3.20%, 12/31/99 6,000
17,000 Louisville & Jefferson Counties VRDN,
Series A-1 (AMT), Regional Airport
Authority System (National City Bank of
Louisville LOC), 3.20%, 4/7/99 17,000
----------
55,166
----------
</TABLE>
See Notes to the Financial Statements.
- -----
24
- -----
<PAGE> 26
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
<TABLE>
<CAPTION>
MUNICIPAL MONEY MARKET FUND (CONTINUED)
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
LOUISIANA - 1.0% MASSACHUSETTS - 2.1%
$9,000 Ascension Parish County Revenue VRDN $ 9,000 Gloucester G.O. BAN,
(AMT), BASF Corp. Project (BASF Corp. 3.61%, 8/5/99 $ 9,010
Gtd.), 3.35%, 4/1/99 $9,000 5,000 Massachusetts Bay Transportation
4,600 Jefferson Parish Industrial Development Authority Revenue Bond, Series A,
Board IDR (AMT), Sara Lee Corp. Project, 7.00%, 3/1/00 5,183
3.20%, 4/1/99 4,600 22,920 Massachusetts Bay Transportation
6,900 Louisiana State G.O. Bonds, Series 1994 Authority Revenue Floating Rate
A, Citicorp Eagle Trust, Certificates, Series 30 (BankAmerica Corp.
3.11%, 4/7/99 6,900 LOC), 3.08%, 4/7/99 22,920
4,000 South Louisiana Port Commission Revenue 1,655 Massachusetts State HFA VRDN, Series
VRDN, Series 1997 (AMT), Holnam, Inc. 1996-5A (AMT), Clipper Trust Certificate
Project (ANB-AMRO LOC), (AMBAC Insured), 3.21%, 4/7/99 1,655
3.10%, 4/7/99 4,000 2,200 Massachusetts State HFA VRDN, Series
---------- PA-132 (AMT), Harbor Point Project
24,500 (AMBAC Insured), 3.05%, 4/7/99 2,200
---------- 10,000 Massachusetts State Water Resource
Authority TOC, Series BTP-297,
MAINE - 0.8% 3.20%, 4/7/99 10,000
2,000 Fort Fairfield County Revenue Bond (AMT), ----------
Atlantic Custom Processors (PNC Bank 50,968
LOC), 3.25%, 4/7/99 2,000 ----------
5,000 Maine Public Utilities Financing Bank
Revenue VRDN, Series 1996 (AMT), Maine MICHIGAN - 4.5%
Public Service Co. Project (Bank of New 20,000 Detroit City School District State School
York LOC), 3.10%, 4/7/99 5,000 Aid Notes, 4.50%, 7/1/99 20,041
1,960 Maine State G.O. Bond, 5.00%, 6/15/99 1,969 12,495 Michigan State Building Development
9,995 Maine State Housing Authority Variable Authority Revenue COP, Series 81,
Rate COP, Series B, 3.21%, 4/7/99 9,995 Floating Rate Trust Certificates,
---------- 3.08%, 4/7/99 12,495
18,964 16,000 Michigan State HDA, Series B (AMT),
---------- 3.00%, 12/1/99 16,000
11,535 Michigan State HDA TOC, Series BTP-197,
MARYLAND - 0.5% 3.30%, 4/7/99 11,535
2,100 Baltimore City Economic Development 20,700 Michigan State Trunk Line Revenue FRN,
VRDN, Series 1985, Mt. Washington Series 21, 3.08%, 4/7/99 20,700
Pediatric Hospital, Inc. (Mellon Bank LOC), 9,000 Michigan Strategic Fund Limited
3.35%, 4/7/99 2,100 Obligation Revenue VRDN (AMT),
3,280 Cecil County Economic Development Dow Chemical Co. Project, 3.20%, 4/1/99 9,000
VRDN (AMT), Steel Techs, Inc. Facilities 5,170 Michigan Strategic Fund Limited
(PNC Bank LOC), 3.25%, 4/7/99 3,280 Obligation Revenue VRDN (AMT), GT
9 Maryland State Community Development USA LLC Project (Comerica Bank LOC),
Administration Bonds, Series PT-12, Merrill 3.20%, 4/7/99 5,170
P-Floats (Commerzbank A.G. LOC), 2,160 Michigan Strategic Fund Limited Obligation
3.01%, 4/1/99 9 VRDN (AMT), Kruger Commodities, Inc. Project
2,800 Maryland State Economic Development (Harris Trust & Savings Bank LOC),
Corp. VRDN (AMT), Unsite Design, Inc. 3.15%, 4/7/99 2,160
(Mellon Bank LOC), 3.45%, 4/7/99 2,800
3,000 Maryland State IDA VRDN, Townsend
Culinary, Inc. Project (SunTrust Banks
LOC), 3.20%, 4/7/99 3,000
----------
11,189
----------
</TABLE>
See Notes to the Financial Statements.
-----
25
-----
<PAGE> 27
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MICHIGAN - 4.5% (CONT'D.) MISSOURI - 1.9% (CONT'D.)
$3,000 Michigan Strategic Fund Limited $ 1,600 Missouri Higher Education Loan Authority
Obligation Revenue VRDN, Dirksen Screw VRDN, Series B (AMT) (MBIA Insured),
Products Co. Project, 3.20%, 4/7/99 $ 3,000 3.15%, 4/7/99 $ 1,600
100 Michigan Strategic Fund Limited 8,500 Missouri Higher Education Loan Authority
Obligation Revenue VRDN, Reserve 1 VRDN, Series B (National Westminister
(Barclays Bank PLC LOC), 3.30%, 4/1/99 100 LOC), 3.10%, 4/7/99 8,500
6,500 Oakland County Economic Development 5,220 Missouri Housing Development VRDN,
Corp. Limited Obligation Revenue VRDN, Series A (AMT), Merrill
Richard & Tool Die Corp. Project, P-Floats PA-116, 3.23%, 4/7/99 5,220
3.20%, 4/7/99 6,500 8,000 St. Louis County IDA Multifamily Housing
-------- Revenue VRDN (AMT), Whispering Lakes
106,701 Apartment Project (Mercantile Bank of St.
-------- Louis LOC), 3.15%, 4/7/99 8,000
MINNESOTA - 1.7% 6,500 St. Louis General Fund TRAN,
8,100 Minnesota State HFA SFM Revenue Bonds, 4.50%, 6/30/99 6,513
Series 1998 F (AMT), 3.70%, 8/9/99 8,100 -------
3,060 Stearns County Housing & Redevelopment 44,212
Authority VRDN (AMT), Cold Spring -------
Granite Co. Project (First Bank LOC), MONTANA - 0.3%
3.35%, 4/7/99 3,060 Montana State Board of Housing
29,500 University of Minnesota Revenue Bond, P-Floats
Series A, 3.00%, 4/7/99 29,500 3,460 Series PA-158, 3.12%, 4/7/99 3,460
------- 2,880 Series PT-87, 3.12%, 4/7/99 2,880
40,660 -------
------- 6,340
MISSISSIPPI - 0.8% -------
4,300 Jackson County PCR VRDN, Chevron NEBRASKA - 0.1%
U.S.A., Inc. Project, 3.10%, 4/1/99 4,300 1,800 Nebraska Investment Financing Authority
9,325 Mississippi State G.O. Refunding SFM Revenue FRN, Series
Bonds, Series BTP-207, 3.20%, 4/7/99 9,325 A3, 3.15%, 4/7/99 1,800
3,250 Mississippi State SFM Revenue Bonds, -------
Series G-CL5 (AMT), P-Floats PT-146, NEVADA - 0.8%
3.12%, 4/7/99 3,250 10,000 Clark County G.O. Bond, Series SGB 18,
2,900 Perry County PCR, Leaf River Forest Municipal Securities Trust Receipts
Project (Wachovia Bank LOC), (FSA Insured), 3.16%, 4/7/99 10,000
3.15%, 4/1/99 2,900 1,710 Clark County Public Safety G.O. Bonds,
------- 4.00%, 2/1/00 1,723
19,775 6,830 Clark County School District G.O. VRDN,
------- Series A, Municipal Trust Certificates
No. 23, 3.21%, 4/7/99 6,830
MISSOURI - 1.9% -------
2,000 Missouri State Development Financing 18,553
Board Infrastructure Facilities IDR Bond, -------
Series A, Science City Union Station NEW JERSEY - 0.4%
(Canadian Imperial Bank of Commerce 10,000 Jersey City G.O. Refunding Notes,
LOC), 4.10%, 12/1/99 2,013 3.625%, 1/14/00 10,032
12,366 Missouri State Environmental -------
Improvement & Energy Revenue
Refunding VRDN, K C Power &
Light Co. Project (Union Bank of
Switzerland LOC), 3.05%, 6/8/99 12,366
</TABLE>
See Notes to the Financial Statements.
- -----
26
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<PAGE> 28
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NEW MEXICO - 0.2% NORTH CAROLINA - 2.8%
$ 5,140 New Mexico Mortgage Financing Authority $ 2,400 Brunswick County IDA PCR VRDN, Series
P-Floats, Series PT-196, 1996 (AMT), Armada Project (NationsBank
3.75%, 5/13/99 $ 5,140 LOC), 3.10%, 4/7/99 $ 2,400
-------- 5,800 Capital Regional Airport Commission
NEW YORK - 3.8% Passenger Facilities Charge Revenue VRDN
5,400 Long Island Power Authority Electric (AMT) (First Union National Bank of
System Revenue VRDN, Series 5, Charlotte LOC), 3.10%, 4/7/99 5,800
3.15%, 4/1/99 5,400 7,300 Catawba County IDA PCR VRDN,
3,000 Nassau County G.O. RAN, Series 1996 (AMT), Hooker Furniture
Series C, 4.00%, 4/13/99 3,001 Corp. Project (NationsBank LOC),
8,900 Nassau County TAN, Series C, 3.10%, 4/7/99 7,300
3.50%, 12/22/99 8,928 3,000 Columbus County Industrial Facilities &
4,400 New York City G.O. VRDN, Series B Financing Authority PCR VRDN (AMT),
(FGIC Insured), 3.40%, 4/1/99 4,400 Conflandey, Inc. Project (Banque
6,000 New York City Municipal Water Finance Nationale de Paris LOC), 3.15%, 4/7/99 3,000
Authority Water & Sewer System Revenue 2,400 Mecklenburg County Industrial
Bonds, Series G (FGIC Insured), Facilities & Financing Authority
3.10%, 4/1/99 6,000 PCR VRDN (AMT), SteriGenics
12,000 New York City RAN, Series A-78, International Project (Comerica Bank
2.90%, 4/13/99 12,000 LOC), 3.20%, 4/7/99 2,400
10,085 New York City Transitional Financing 1,030 North Carolina HFA SFM Tender Option
Authority Revenue Floating Rate Revenue Bond (FHA Insured),
Certificates, Series 27 (BankAmerica Corp. 2.95%, 9/1/99 1,030
LOC), 3.08%, 4/7/99 10,085 8,000 North Carolina Medical Care Community
New York State Dormitory Authority, Hospital Revenue Bond, Pooled
Series A, Rockefeller University, Citicorp Equipment Financing Project
Eagle Trust (MBIA Insured), 2.95%, 4/7/99 8,000
6,100 No. 973201, 3.11%, 4/7/99 6,100 20,000 North Carolina State P-Floats,
5,000 No. 973202, 3.11%, 4/7/99 5,000 Series PA-260, 3.07%, 4/7/99 20,000
2,725 New York State Environmental Facilities 3,600 North Carolina State Ports Authority
Corp. PCR VRDN, Eagle Trust No. 94302, VRDN, Series 1996 (AMT), Morehead City
Weekly Option (FSA Insured), Terminals, Inc. (NationsBank LOC),
3.40%, 4/1/99 2,725 3.10%, 4/7/99 3,600
10,850 New York State Medical Care Facilities 7,385 North Carolina State ROC, Series 48,
Financing Agency Revenue Refunding 3.16%, 4/7/99 7,385
Bond, Series B, St. Lukes (FHA Insured), 3,100 Persons County Industrial Facilities &
7.45%, 2/15/00 11,442 Pollution Control Financing Authority
9,595 New York State Urban Development Corp. Revenue Refunding VRDN, Series A,
Revenue, Series PA-429, P-Floats, Carolina Power & Light Co.,
3.05%, 4/7/99 9,595 3.10%, 4/7/99 3,100
6,000 Suffolk County TAN, Series I 2,420 Raleigh COP, Equipment Acquisition
(WestDeutsche Landesbank LOC), Project, 3.00%, 12/1/99 2,421
3.50%, 8/12/99 6,011 --------
-------- 66,436
90,687 --------
-------- OHIO - 3.9%
14,640 Cleveland Waterworks Revenue Bond,
Series A, Municipal Trust Certificates
No. 18, 3.21%, 4/7/99 14,640
</TABLE>
See Notes to the Financial Statements.
-----
27
-----
<PAGE> 29
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (continued)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
OHIO - 3.9% (CONT'D.) Oregon - 0.7% (CONT'D.)
$ 6,465 Dublin Inn Tax-Exempt Mortgage Bond $ 4,820 Multnomah County School District G.O.
Trust, Series 1987 (Huntington National Bond, Series 1996, BTP-208,
Bank LOC), 4.57%, 9/1/99 $ 6,465 3.17%, 6/8/99 $ 4,820
12,000 Ohio State Air Quality Development 3,900 Oregon State Economic Development
Authority VRDN, Series A, Ohio Edison Revenue, Series 176 (AMT), Cascade Steel
Project (Toronto-Dominion Bank LOC), Rolling Mills Project (Commerzbank A.G.
2.95%, 2/1/00 12,000 LOC), 3.05%, 4/7/99 3,900
25,000 Ohio State HFA Residential Mortgage 6,600 Oregon State Economic Development
Revenue VRDN, Series A-2 (AMT), Revenue Series 181 (AMT), Oregon Metal
3.05%, 3/1/00 25,000 Slitters, Inc. (Key Bank N.A. LOC),
3,805 Ohio State HFA VRDN, Series 1989 A 3.15%, 4/7/99 6,600
(AMT), 3.00%, 4/7/99 3,805 -------
5,875 Ohio State Infrastructure Improvement VRDN, 16,420
Series 1994, BTP-170, 3.17%, 6/8/99 5,875 -------
8,910 Ohio State Public Facilities Commission
VRDN, Series BTP-237, Higher Education PENNSYLVANIA - 4.8%
Facilities Project (AMBAC Insured), 4,185 Allegheny County Adjustable Rate G.O.
3.20%, 4/7/99 8,910 Bond, Series C-41 (National City Bank
5,600 Ohio State Turnpike Commission Revenue LOC), 3.15%, 4/7/99 4,185
Bonds, Weekly Option Period, PCR-18, 1,520 Allegheny County Hospital Development
3.21%, 4/7/99 5,600 Bonds, Series B-3, Presbyterian University
1,900 Ohio State Water Development Authority Hospital (NBD Bank LOC), 3.15%, 4/1/99 1,520
PCR Refunding VRDN, Philip Morris Cos., 6,730 Allegheny County Hospital Development
Inc. Project, 3.20%, 4/7/99 1,900 Authority Revenue VRDN, Series A,
6,600 Student Loan Funding Corp. Presbyterian Health Center (MBIA Insured),
Revenue Refunding VRDN, Series A-1 3.15%, 4/1/99 6,730
(AMT), 3.05%, 4/7/99 6,600 3,700 Chester County IDA Bonds,
2,200 Union County IDR VRDN (AMT), Union Series 1997 A (AMT), KAC III Realty
Aggregates Co. Project (PNC Bank LOC), Corp. Project (PNC Bank LOC), 3.25%, 4/7/99 3,700
3.25%, 4/7/99 2,200 22,500 Delaware Valley Regional Finance Authority
------- VRDN, Series 1997 A, Merrill Lynch P-Floats
92,995 (Midland Bank PLC LOC), 3.15%, 6/17/99 22,500
------- 2,800 Geisinger Authority Health System Revenue
OKLAHOMA - 1.0% VRDN, Series B, Geisinger Health Project
6,360 Oklahoma Water Resources Board State (Morgan Guaranty Trust LOC),
Loan Program Bonds, Series 1994 A 3.05%, 4/1/99 2,800
(Swiss Bank Corp. LOC), 3.30%, 3/9/00 6,360 3,935 New Castle Area Hospital Authority Revenue
Tulsa City Airport Improvement VRDN Bond, Jameson Memorial Hospital
(AMT) (MBIA Insured) (FSA Insured), 3.05%, 4/1/99 3,935
7,245 Series B-1, 3.16%, 4/7/99 7,245 3,500 Pennsylvania Economic Development
9,390 Series B-2, 3.16%, 4/7/99 9,390 Financing Authority IDR VRDN, Series
------- 1996 A1-8 (AMT) (PNC Bank LOC),
22,995 3.25%, 4/7/99 3,500
------- 9,250 Pennsylvania Economic Development
OREGON - 0.7% Financing Authority Revenue
$ 1,100 Metropolitan Service District Riedel Bond (AMT), Approved Solid Waste Project,
Compost Waste Disposal VRDN (AMT) 3.25%, 12/15/99 9,250
(US Bank LOC), 3.20%, 4/7/99 1,100
</TABLE>
See Notes to the Financial Statements.
- -----
28
- -----
<PAGE> 30
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PENNSYLVANIA - 4.8% (CONT'D.) SOUTH CAROLINA - 1.0% (CONT'D.)
$ 3,050 Pennsylvania Higher Educational Assistance $ 6,630 South Carolina Public Service Authority
Agency Student Loan Revenue Bond, Revenue Promissory Notes, 2.75%, 5/13/99 $ 6,630
Series A, 3.10%, 4/7/99 $ 3,050 --------
2,400 Pennsylvania Higher Educational Facilities 23,379
Authority Revenue Bond, Series A-2, --------
Council of Independent Colleges (Allied
Irish Bank PLC LOC), 3.15%, 4/1/99 2,400 SOUTH DAKOTA - 0.5%
8,410 South Dakota Economic Development
30,200 Pennsylvania Higher Educational Facilities Finance Authority VRDN, Series 1996 (AMT),
Authority Revenue Bond, Series C, Hastings Filters, Inc. Project (Harris Trust &
University of Pennsylvania Health Services, Savings Bank LOC), 3.10%, 4/7/99 8,410
3.20%, 4/7/99 30,200 South Dakota Housing Development
9,900 Pennsylvania Intergovernmental Authority Homeowner Mortgage VRDN
Cooperative Authority Special Tax TOB, (AMT), Merrill P-Floats
Series BTP-289, 3.20%, 4/7/99 9,900 240 Series PA-119, 3.12%, 4/7/99 240
6,145 Philadelphia Airport Revenue TOB, 4,375 Series PT-73-A, 3.07%, 4/7/99 4,375
Series BTP-317, 3.20%, 4/7/99 6,145 --------
4,000 Pittsburgh Urban Redevelopment Authority 13,025
Bonds, Series C (AMT), 3.20%, 12/1/99 4,000 --------
2,025 Washington County IDA Revenue VRDN TENNESSEE - 3.7%
(AMT), Accutrex Products, Inc. Project 1,400 Dickson County IDR VRDN, Series 1996
(Mellon Bank LOC), 3.45%, 4/7/99 2,025 (AMT), Tennessee Bun Co. LLC Project
------- (PNC Bank LOC), 3.25%, 4/7/99 1,400
15,840 6,000 Jackson City Waste Facilities IDR VRDN,
------- Series 1995 (AMT), Florida Steel Corp.
SOUTH CAROLINA - 1.0% Project (NationsBank LOC), 3.10%, 4/7/99 6,000
5,400 Cherokee County IDR VRDN, Series 1989 5,000 Metropolitan Government Nashville &
(AMT), Oshkosh Truck Corp. Project Davidson Counties Health &
(NationsBank LOC), 3.15%, 4/7/99 5,400 Education Facilities Board Revenue VRDN,
1,000 Florence County Public Facilities Corp. Series A (AMT), Old Hickory Towers
Bonds, Law Enforcement Project-Civic (FHLB LOC), 3.25%, 4/7/99 5,000
Center (AMBAC Insured), 7.60%, 3/1/00 1,049 2,000 Morristown City IDR VRDN, Series 1997,
200 Lexington County IDA PCR VRDN, BOS Automotive Products, Inc. (Bayerische
Series A, Allied-Signal Project (Allied-Signal Vereinsbank LOC), 3.20%, 4/7/99 2,000
Corp. Gtd.), 3.10%, 4/7/99 200 23,175 Nashville & Davidson Counties Electric
900 Lexington County Pollution Control Revenue VRDN, Citicorp Eagle Trust,
Facilities Revenue Bond, Series A, Allied- 3.11%, 4/7/99 23,175
Signal Project, 3.10%, 4/7/99 900 4,000 Nashville & Davidson Counties
5,200 South Carolina Jobs Economic Health & Education Facilities Board
Development Authority (AMT), Revenue VRDN, Series 1996-A, Adventist
Greenville YMCA Project Health Systems-Sunbelt (SunTrust Banks
(NationsBank LOC), 3.05%, 4/7/99 5,200 LOC), 3.05%, 4/7/99 4,000
4,000 South Carolina Jobs Economic 4,590 Sevier County Public Building Authority
Development Authority Revenue VRDN Local Government Public Improvement Bonds,
(AMT), Virtual Image Technology Series E-2 (AMT), 3.10%, 4/7/99 4,590
(NationsBank LOC), 3.15%, 4/7/99 4,000
</TABLE>
See Notes to the Financial Statements.
-----
29
-----
<PAGE> 31
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TENNESSEE - 3.7% (CONT'D.) TEXAS - 15.3% (CONT'D.)
$ 8,400 Shelby County G.O. Bond, Series 1996 B, $ 6,500 Denton County Independent School
Soc Gen Trust SGB-21 (FSA Insured), District G.O., Series B (PSF of Texas Gtd.),
3.16%, 4/7/99 $ 8,400 3.65%, 8/15/99 $ 6,500
Shelby County G.O. TOB 3,500 El Paso City Housing Financing Corp.
4,900 Series B BTP-263, 3.20%, 4/7/99 4,900 VRDN, Series 1993 (AMT), Viva Apartments
4,890 Series B BTP-216, 3.17%, 6/8/99 4,890 Project (General Electric Corp. LOC),
1,000 Shelby County Health & Educational 3.25%, 4/7/99 3,500
Housing Facilities Board Multi-family 7,850 Galveston County Housing Financing Corp.
Housing Revenue VRDN, Arbor Lake SFM Revenue Bond, Series PT 205, P-Floats
Project (PNC Bank LOC), 3.15%, 4/7/99 1,000 (Bayerische Vereinsbank LOC),
8,500 Signal Mountain Health Education 3.12%, 4/7/99 7,850
Revenue Refunding Bonds, Alexian Village 5,000 Greater Texas Student Loan Corp.,
Project, 3.30%, 2/29/00 8,500 Series A (AMT) (SLMA LOC),
15,000 Tennessee State HDA Optional 3.00%, 2/1/00 Gulf Coast 5,000
Homeownership Program, Series 3-C, Waste Disposal Authority VRDN,
3.10%, 11/18/99 15,000 Series 1994 (AMT), Amoco Oil Co.
------- Project (BP Amoco PLC Gtd.)
88,855 1,800 3.30%, 4/1/99 1,800
------- 3,100 3.35%, 4/1/99 3,100
4,600 3.15%, 10/1/99 4,600
12,000 Harris County Floating Rate Receipts,
TEXAS - 15.3% Series SG-96, 3.07%, 4/7/99 12,000
23,535 Arlington Independent School District 3,400 Harris County Health Facilities
VRDN, Series 17, Reset Option Certificates Development Corp. Methodist Hospital
(Toronto-Dominion Bank LOC), Revenue VRDN, Series 1994 (Morgan
3.16%, 4/7/99 23,535 Guaranty Trust LOC), 3.10%, 4/1/99 3,400
11,400 Austin Airport System Revenue Bonds, 9,700 Harris County Health Facilities
Series A (Morgan Guaranty Trust LOC), Development Corp. Revenue Bonds,
3.00%, 4/7/99 11,400 Series 6, 3.15%, 4/7/99 9,700
7,425 Austin City Independent School District 11,880 Harris County Toll Road Unlimited Tax
Building VRDN, Series 1996 SG-68 (PSF of Subordinate Lien Revenue Bonds, CR138,
Texas Gtd.), 3.07%, 4/7/99 7,425 3.11%, 4/7/99 11,880
11,900 Bastrop Independent School District G.O. 20,420 Harris County Toll Road Unlimited Tax
VRDN, Municipal Securities Trust Receipts, VRDN, Series 1994 A, Citicorp Eagle Trust
Series SGB-37 (PSF of Texas Gtd.), No. 954302, 3.11%, 4/7/99 20,420
3.16%, 4/7/99 11,900 15,000 Harris County VRDN, Municipal Securities
1,200 Brazos River Authority PCR Refunding Trust Receipts, Series 21, 3.25%, 4/7/99 15,000
Bond, Series 1997-B, Texas Utilities Electric 3,425 Houston Independent School District G.O.
Co., 3.15%, 4/1/99 1,200 Bond, Public Property Financing
5,000 Calhoun County Navigation IDR VRDN Contractual Obligation, 4.50%, 7/15/99 3,433
(AMT), Formosa Plastics Corp. U.S.A. 12,000 Hurst, Euless & Bedford Independent
(BankAmerica Corp. LOC), 3.05%, 4/7/99 5,000 School Districts Floating Rate Receipts,
5,935 Dallas Area Rapid Transit Sales Tax CP Series PT-1050, 3.07%, 4/7/99 12,000
Notes, Series A, 2.80%, 6/11/99 5,935 6,000 Hurst, Euless & Bedford Independent
28,995 Dallas G.O. Refunding Bonds, Morgan School Districts Floating Rate Receipts,
Stanley Floating Rate Certificates, Series 93, Series SG-98 (PSF of Texas Gtd.),
3.08%, 4/7/99 28,995 3.07%, 4/7/99 6,000
</TABLE>
See Notes to the Financial Statements.
-----
30
-----
<PAGE> 32
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TEXAS - 15.3% (CONT'D.) UTAH - 0.7%
$ 7,245 Pearland City Independent School District $ 5,400 Intermountain Power Supply Revenue
G.O., Series 1997 SG-106 (PSF of Texas Bonds, Municipal Securities Trust Receipts,
Gtd.), 3.07%, 4/7/99 $ 7,245 Series SG-6, 3.07%, 4/7/99 $ 5,400
18,425 Port Arthur Navigation District Revenue 2,715 Salt Lake City PCR Bonds, Amoco
VRDN (AMT), Fina Oil & Chemical Co. Standard Oil Industry Project,
Project, 3.35%, 4/1/99 18,425 3.45%, 4/1/99 2,715
5,000 Port Arthur Navigation District Revenue 9,850 State of Utah TOC, Series BTP-303,
VRDN (AMT), BASF Corp. Project, 3.20%, 4/7/99 9,850
3.35%, 4/1/99 5,000 -------
Port of Corpus Christi Solid Waste Disposal 17,965
VRDN, Koch Refining Co. Project (AMT) -------
25,000 3.15%, 4/7/99 25,000 VIRGINIA - 2.3%
13,750 Series 1996, 3.15%, 4/7/99 13,750 4,000 Botetourt County IDR VRDN (AMT),
1,230 Richardson City Independent School Valley Forge Co. Project (Harris Trust &
District G.O. Refunding Bonds, Savings Bank LOC), 3.15%, 4/7/99 4,000
4.75%, 2/15/00 1,248 9,500 Grant County Waste Disposal Revenue
9,000 Richardson City Independent School Bonds, Series 1996 (AMT), Virginia
District TRAN, 4.00%, 8/27/99 9,015 Electric Power Co. Project,
4,400 Sabine River Authority PCR Bond, 3.15%, 7/15/99 9,500
Series B, Texas Utilities Electric Co. 3,900 Halifax County IDA VRDN, Series 1998
(AMBAC Insured), 3.35%, 4/1/99 4,400 (AMT), D-Scan, Inc. Project (NationsBank
10,000 San Antonio City Electric & Gas System LOC), 3.10%, 4/7/99 3,900
Revenue Bonds, Merrill Lynch Trust 12,300 Norfolk City G.O. VRDN, Citicorp Eagle
Receipts SG-105, 3.07%, 4/7/99 10,000 Trust No. 944601, 3.16%, 4/7/99 12,300
5,000 San Antonio City Electric & Gas System 15,615 Virginia State G.O. VRDN, Series 1994,
Revenue Bonds, Series A, Municipal Trust Citicorp Eagle Trust No. 954601,
Certificates, No. 32, 3.21%, 4/7/99 5,000 3.11%, 4/7/99 15,615
9,880 San Antonio City Electric & Gas System 9,385 Virginia State HDA Commonwealth
Revenue Bonds, Series SG-107, Municipal Mortgage TOB, Series BTP-196,
Securities Trust Receipts, 3.07%, 4/7/99 9,880 3.25%, 4/7/99 9,385
6,600 San Antonio Independent School District -------
ROC, Series 30, 3.16%, 4/7/99 6,600 54,700
11,210 Sherman Independent School District G.O., -------
Series 1985 A, SG-80 (PSF Gtd.), 3.07%, WASHINGTON - 3.3%
4/7/99 11,210 2,850 Algona Economic Development Corp.
5,000 State of Texas TRAN, (AMT), Peter Pan Seafoods Project
4.50%, 8/31/99 5,033 (Seattle First National Bank LOC),
6,220 Texas Department of Housing and 3.05%, 4/7/99 2,850
Community Affairs SFM VRDN, Series 5,700 Grandview City Public Corp. IDR VRDN,
PA-128 (AMT), 3.23%, 4/7/99 6,220 Series 1989 (AMT), Shonan USA Project
5,200 Texas Water Development Board Revenue (BankAmerica Corp. LOC),
Bonds, Municipal Trust Certificates No. 19, 3.05%, 4/7/99 5,700
Series A, 3.21%, 4/17/99 5,200 1,200 Kent City Economic Development Corp.
-------- IDR VRDN, Associated Grocers Project
364,799 (BankAmerica Corp. LOC),
-------- 3.72%, 4/7/99 1,200
</TABLE>
See Notes to the Financial Statements.
-----
31
-----
<PAGE> 33
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
WASHINGTON - 3.3% (CONT'D.) WISCONSIN - 2.9% (CONT'D.)
$ 5,340 Seattle City Municipal Light & Power $ 4,290 Pewaukee IDR VRDN, Series 1992
Revenue TOB, Series BTP-272, (AMT), HUSCO International, Inc. Project
3.17%, 6/8/99 $ 5,340 (Bank One LOC), 3.05%, 4/7/99 $ 4,290
17,519 Washington Public Power Supply System 10,500 Racine Unified School District
Revenue Bonds, Series 1990 B, Nuclear Revenue Bond, 4.00%, 7/7/99 10,511
Project No. 2, BTP-85, 2,800 Rhinelander School District TRAN,
Prerefunded, 3.15%, 8/26/99 17,519 3.75%, 9/30/99 2,807
21,200 Washington Public Power Supply System 6,000 River Falls School District BAN,
Revenue Bonds, Series 1994, 3.75%, 11/1/99 6,025
Citicorp Eagle Trust, 3.21%, 4/7/99 21,200 6,500 Waupaca School District BAN,
3,500 Washington Public Power Supply System 3.20%, 12/1/99 6,505
Revenue Refunding Bond, Series A, 1,830 Wisconsin Health and Education Revenue
Nuclear Project No. 2, 6.20%, 7/1/99 3,524 Bond, Series 1994 A, Sinai Samaritan
4,900 Washington State Housing Finance Medical Center Project (M&I Bank LOC),
Commission Single Family Program VRDN, 3.10%, 4/7/99 1,830
Series 1A-S (AMT), 3.00%, 2/1/00 4,900 4,235 Wisconsin Health and Education Revenue
6,065 Washington State Refunding TOC, Bond, Series 1997, Froedtert Memorial
BTP-101, 3.20%, 4/7/99 6,065 Lutheran Hospital Trust (M&I Bank LOC),
9,575 Washington State TOC, Series BTP-125, 3.10%, 4/7/99 4,235
3.20%, 4/7/99 9,575 5,000 Wisconsin Housing and Economic
------- Development Authority Revenue Floating
77,873 Rate Trust Receipts, Series 1997 FR/RI-18
------- (AMT), 3.20%, 4/7/99 5,000
11,125 Wisconsin Housing and Economic
WEST VIRGINIA - 0.4% Development Authority Revenue TOB,
1,300 Brooke County IDR, Series 1997 (AMT), Home Ownership Revenue Program,
Star-Kist Foods, Inc. Project 3.10%, 9/1/99 11,125
(H.J. Heinz Co. Gtd.), 3.25%, 4/7/99 1,300 8,210 Wisconsin State G.O. Bond,
Marion County Solid Waste Disposal Series D (AMT), 3.17%, 6/8/99 8,210
Facilities Revenue VRDN (AMT), Granttown -------
Project (National Westminster Bank LOC) 68,350
2,900 Series B, 3.10%, 4/7/99 2,900 -------
2,500 Series C, 3.10%, 4/7/99 2,500
2,000 Ritchie County IDR VRDN (AMT), WYOMING - 0.4%
Simonton Building Products, Inc. Project 10,710 Wyoming Community Development
(PNC Bank LOC), 3.25%, 4/7/99 2,000 Authority SFM Bonds, Series H (AMT),
------- BTP-198, 3.30%, 4/7/99 10,710
8,700 -------
-------
MULTIPLE STATES POOLED SECURITIES - 2.5%
WISCONSIN - 2.9% 16,000 Greystone County Variable Rate Senior
2,500 Luxemburg-Casco School District BAN, Certificate Trust, Series 1998-1
3.60%, 12/15/99 2,503 (Credit Suisse First Boston LOC),
2,950 Milwaukee City Redevelopment VRDN, 3.20%, 4/7/99 16,000
Series 1996 (AMT), Starline Manufacturing, 36,020 Pooled Puttable Float Options (AMT),
Inc. (Harris Trust & Savings Bank LOC), PPT-7D (Backed by Various Housing Agencies),
3.15%, 4/7/99 2,950 3.375%, 2/10/00 36,020
2,350 Mukwonago School District BAN,
3.75%, 11/1/99 2,359
</TABLE>
See Notes to the Financial Statements.
- -----
32
- -----
<PAGE> 34
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
- --------------------------------------------------------------------------------
<S> <C> <C>
MULTIPLE STATES POOLED SECURITIES - 2.5% (CONT'D.)
$8,000 Pooled Puttable Float Option (AMT),
Series PT6 (Backed by Various Housing
Agencies), 3.90%, 7/8/99 $ 8,000
1,720 Pooled Puttable VRDN, Series PPT2
(Backed by Alaska HFA & South
Dakota HDA), 3.01%, 4/1/99 1,720
----------
61,740
----------
Total Municipal Investments
(cost $2,302,901) 2,302,901
----------
NUMBER
OF SHARES
(000S)
- ---------
OTHER - 0.8%
6,326 AIM Tax Free Money Market Fund 6,326
800 Dreyfus Tax-Exempt Cash
Management Fund 800
1,571 Federated Tax Free Trust Money Market
Fund No. 15 1,571
500 Federated Tax Free Trust Money Market
Fund No. 73 500
8,760 Provident Municipal Cash Fund (AMT) 8,760
916 Provident Municipal Fund 916
----------
Total Other
(cost $18,873) 18,873
----------
Total Investments - 97.4%
(cost $2,321,774) 2,321,774
Other Assets less Liabilities - 2.6% 62,256
----------
NET ASSETS - 100.0% $2,384,030
==========
</TABLE>
See Notes to the Financial Statements.
-----
33
-----
<PAGE> 35
SCHEDULES OF INVESTMENTS MARCH 31, 1999
CALIFORNIA MUNICIPAL MONEY MARKET FUND
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- -------------------------------------------------------------------------------------------------------------------------- ---------
<S> <C> <C> <C> <C> <C>
MUNICIPAL INVESTMENTS - 98.3% CALIFORNIA - 93.3% (CONT'D.)
$ 1,000 California Pollution Control Finance
CALIFORNIA - 93.3% Authority Revenue Bond, Series 1997 A
$ 7,000 California HFA Home Mortgage Housing (AMT), ARCO Project (Atlantic Richfield
Revenue Variable Rate Certificates, Co. Gtd.), 2.80%, 4/7/99 $ 1,000
Series 1998 R (AMT) (MBIA Insured), 3,000 California Pollution Control Finance
3.50%, 8/20/99 $ 7,000 Authority Revenue Bond, Series 1997 A,
1,640 California HFA Home Mortgage Revenue Pacific Gas & Electric Co.
FRN, Merrill P-Floats PT-14, Series 1993-B, (Toronto-Dominion Bank LOC),
2.85%, 4/7/99 1,640 3.00%, 4/1/99 3,000
1,550 California HFA Housing Revenue Bond, 7,300 California Pollution Control Finance
Series 1990 A, Sutter Health Authority Revenue Bond, Series 1997 B
(Morgan Guaranty Trust LOC), 3.00%, (AMT), Air Products Manufacturing Co.
4/1/99 1,550 (Air Products & Chemicals Corp. Gtd.),
1,500 California HFA Housing Revenue FRN, 2.90%, 4/7/99 7,300
Merrill P-Floats PT-40D (AMT), 3,600 California Pollution Control Finance
2.90%, 4/7/99 1,500 Authority Revenue Bond, Series A (AMT),
280 California HFA Housing Revenue FRN, Pacific Gas & Electric Co. (Union Bank of
Merrill P-Floats PT-56 (AMT), Switzerland AG LOC), 2.70%, 4/7/99 3,600
2.90%, 4/7/99 280 7,455 California State Department of Water
7,485 California HFA Housing Revenue FRN, Resources and Sewer VRDN, ML/SG
Series A-2 PT-258 (AMT), Muni Trust, Series SG-5, CVP,
2.95%, 1/13/00 7,485 2.85%, 4/7/99 7,455
7,125 California HFA Housing Multifamily 2,000 California State Economic Development
Revenue FRN, Series III-D A (AMT) Finance Authority IDR Bond, Series 1998
(Morgan Guaranty Trust LOC), (AMT), Lion Raisins Project (BankAmerica
2.95%, 4/7/99 7,125 Corp. LOC), 2.80%, 4/7/99 2,000
12,000 California HFA Kaiser Permanente IDR 1,050 California State Economic Development
FRN, Morgan Stanley Muni Trust, Finance Authority IDR VRDN, Series 1996,
Series 1998-26 (FSA Insured), Volk Enterprises, Inc. (Harris Bank Corp.
2.91%, 4/7/99 12,000 Gtd.), 2.75%, 4/7/99 1,050
2,900 California HFA Multi-Unit Housing 1,100 California State Economic Development
Revenue FRN, Series 92A CR-231 Finance Authority, Series 1998 A, California
(MBIA Insured), 2.95%, 5/1/99 2,900 Independent Systems Operator Corp.
California HFA Revenue Bonds, Catholic (BankAmerica Corp. LOC), 3.00%, 4/1/99 1,100
Healthcare West 20,095 California State G.O., BankAmerica Corp.
2,500 Series 1995 D (MBIA Insured), Variable Rate Certificate, Series 1997 H
2.70%, 4/7/99 2,500 (Colld. by U.S. Government Securities),
3,300 Series 1996 D (MBIA Insured), 3.11%, 4/7/99 20,095
2.70%, 4/7/99 3,300 California State G.O., Citibank TOB
2,400 Series 1997 B (MBIA Insured), (FGIC Insured)
2.70%, 4/7/99 2,400 1,500 Series 5027 C, 2.91%, 4/1/99 1,500
8,700 California Pollution Control 6,200 Series CR-152, 2.91%, 4/1/99 6,200
Finance Authority PCR Bond, 1,945 California State G.O. Refunding Bond,
Series F, Pacific Gas & East Bay Regional Park District,
Electric Co. (Banque Nationale 2.79%, 9/1/99 1,956
de Paris LOC), 3.00%, 4/1/99 8,700
</TABLE>
See Notes to the Financial Statements.
- -----
34
- -----
<PAGE> 36
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
CALIFORNIA MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CALIFORNIA -93.3% (CONT'D.) CALIFORNIA - 93.3% (CONT'D.)
$ 2,400 California State G.O., Series A, $1,625 Eastern Metropolitan Water District of
2.50%, 5/20/99 $ 2,400 California COP (Colld. by U.S. Government
1,200 California State G.O., Weekly Option, Securities), 2.71%, 11/1/99 $1,663
Series CR-153, 3.75%, 4/1/99 1,200 3,000 Fontana Unified School District TRAN
3,415 California State G.O., Weekly Put TOCR 1998-99, 3.61%, 7/9/99 3,003
(MBIA Insured), 2.95%, 4/7/99 3,415 1,100 Foothill/Eastern Transportation Corridor
4,200 California State Housing Revenue Bond, Agency Toll Road Revenue Bonds,
Series 1996-6A, Clipper Trust Certificates Series 1995 B (Morgan Guaranty Trust
(AMT) (Colld. by FNMA Securities), LOC), 2.70%, 4/7/99 1,100
3.23%, 6/1/99 4,200 4,000 Grossmont Unified High School District
700 California State PCR Bond, Series C, COP (FSA Insured), 4.00%, 9/1/99 4,024
Southern California Project 3,000 Irvine Ranch Consolidated Water
(Southern California Edison Corp. Gtd.), Districts 2, 102, 103 & 206 Water
3.30%, 4/1/99 700 and Sewer FRN, Series 1993 B
2,400 California State PCR Bond, Southern (Morgan Guaranty Trust LOC),
California Edison Project (Southern 3.00%, 4/1/99 3,000
California Edison Corp. Gtd.), 5,700 Irvine Ranch Consolidated Water
Series A, 3.30%, 4/1/99 400 Districts 105, 140, 240 & 250,
Series D, 3.30%, 4/1/99 2,000 Series 95 (Commerzbank A.G. LOC),
5,000 California State RAN, 3.15%, 6/30/99 5,010 3.00%, 4/1/99 5,700
3,000 California State Various Purpose 2,500 Irvine Ranch Water District Revenue Bond,
G.O. Bonds, Merrill Floating Rate Receipts Series 1985 (Landesbank Hessen Thuringen
SG-91 (FGIC Insured), 2.90%, 4/7/99 3,000 Girozentra LOC), 3.00%, 4/1/99 2,500
3,500 California Statewide Community 1,650 Irvine Ranch Water District Revenue Bonds,
Development Authority IDR Bonds, Series 1985 (Landesbank Hessen Thuringen
Series 1998 A (AMT), A & B Die Casting Co. Girozentra LOC), 3.00%, 4/1/99 1,650
(BankAmerica Corp. LOC), 2.85%, 4/7/99 3,500 3,200 Kern County Public Facilities Project COP,
4,600 California Statewide Community Series A (Swiss Bank LOC),
Development Authority Multifamily 2.70%, 4/7/99 3,200
Housing Revenue Bond, Series S (AMT), 1,800 Limited Obligation Improvement Bond,
Concord Green Apartments (FHLB LOC), Irvine City Assessment District 87-8
3.05%, 4/7/99 4,600 (KBC Bank of Nevada LOC),
17,100 California Statewide Community 3.00%, 4/1/99 1,800
Development Authority TRAN, 1,800 Limited Obligation Improvement Bond,
Series 1998-99, 2.90%, 4/7/99 17,100 Irvine City Assessment District 97-17
2,300 Chula Vista IDR Bond, Series 1996 A, (Hypo Vereinsbank LOC), 3.00%, 4/1/99 1,800
San Diego Gas & Electric Co., 2,700 Livermore Multifamily Housing Revenue
3.00%, 4/1/99 2,300 Bond, Series A (AMT), Portola Meadows
10,200 Chula Vista IDR Bond, Series 1996 B (AMT), Apartments (BankAmerica Corp. LOC),
San Diego Gas & Electric Co., 3.35%, 4/1/99 10,200 2.80%, 4/7/99 2,700
17,785 Contra Costa County Home Mortgage 3,000 Long Beach TRAN, Series 1998-99,
Revenue Variable Rates Certificates, 3.12%, 10/5/99 3,013
Series 1997 C (Colld. by U.S. Government 1,700 Los Angeles City Multifamily Housing
Securities), 3.11%, 4/7/99 17,785 Revenue Refunding Bond, Series 1995 D
(AMT), Coral Wood Court Project
(Union Bank of California LOC),
3.40%, 4/7/99 1,700
</TABLE>
See Notes to the Financial Statements.
-----
35
-----
<PAGE> 37
SCHEDULES OF INVESTMENTS MARCH 31, 1999
CALIFORNIA MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT VALUE AMOUNT VALUE
(000s) (000s) (000s) (000s)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CALIFORNIA - 93.3%. (CONT'D.) CALIFORNIA - 93.3%. (CONT'D.)
$ 7,246 Los Angeles City Subordinate Tax $ 1,020 Riverside County Multifamily Housing
Allocation, IDR FRN, BTP-129 (Colld. by Revenue FRN, Series A, Ambergate
U.S. Government Securities), 3.15%, Apartments (Union Bank of California
4/7/99 $ 7,246 LOC), 2.95%, 4/7/99 $ 1,020
7,705 Los Angeles City Unlimited G.O. FRN, 1,800 Riverside County Public Facilities
Series A (FGIC Insured), 3.06%, 4/7/99 7,705 Project COP, Series B (National
7,575 Los Angeles Community Development Westminster PLC LOC), 2.75%, 4/7/99 1,800
VRDN, Promenade Towers (Barclays Bank 8,345 Riverside County School Finance Authority
LOC), 2.95%, 4/7/99 7,575 RAN, Series A, 2.90%, 7/30/99 8,345
1,525 Los Angeles Convention and Exhibition 2,500 Riverside County TRAN, Series 1998-99,
Center Revenue VRDN, Merrill P-Floats, 4.44%, 9/30/99 2,518
Series 1993 PA-88 (MBIA Insured), 1,500 Sacramento-Yolo Port District VRDN,
2.85%, 4/7/99 1,525 Series 1997 A (AMT), California Free Trade
Metropolitan Water District of Southern Zone Project (Wells Fargo & Co. LOC),
California CP, Series B 2.85%, 4/7/99 1,500
10,400 2.90%, 6/7/99 10,400 2,050 San Bernardino County Housing Authority
3,200 3.00%, 6/8/99 3,200 Revenue FRN, Series A, Brookside Meadows
1,000 Northwest Irvine Limited Obligation Multifamily Housing (Chase Manhattan
Improvement Bond, Irvine City Assessment Bank N.A. LOC), 2.80%, 4/7/99 2,050
District 97-16 (Soc Gen LOC), 3.00%, 4/1/99 1,000 3,000 San Francisco City and County Airport
1,500 Ontario IDA Revenue Bond, L.D. Brinkman Commission International Airport Revenue
& Co. Project (Union Bank of California FRN (AMT), Susquehanna Structured
LOC), 3.10%, 4/1/99 1,500 Projects SSP-4 (AMBAC Insured),
10,080 Orange County Apartment Development 3.05%, 4/7/99 3,000
Housing Revenue FRN, Series 1992 B, 3,175 San Francisco City and County Variable
Aliso Creek Project (Wells Fargo & Co. Rate Certificates, Series 1996-AA6 (FGIC
LOC), 3.10%, 4/7/99 10,080 Insured), 3.06%, 4/7/99 3,175
4,000 Orange County Apartment Development 7,610 San Marcos City Public Facility Authority
Housing Revenue FRN, Wood Canyon Villas Revenue Bond, Series BTP-188, Civic
Issue B of 1991 (BankAmerica Corp. LOC), Center Projects (Colld. by U.S.
2.85%, 4/7/99 4,000 Government Securities),
2,400 Orange County COP Consolidated 3.11%, 8/31/99 7,610
Sanitation Districts 1-3, 5-7, 11, 645 Santa Clara County Housing Authority
13 & 14 Water and Sewer FRN (National Multifamily VRDN, Series A (AMT),
Westminster PLC LOC), 3.00%, 4/1/99 2,400 Avenida Espana Gardens (Union Bank of
900 Orange County Limited Obligation California LOC), 3.10%, 4/7/99 645
Improvement Bond, Irvine Coast 1,000 Tustin Limited G.O. Improvement Bond,
Assessment District 88-1 (Soc Gen LOC), Series A, Reassessment District 95-2
3.00%, 4/1/99 900 (KBC Bank of Nevada LOC),
4,390 Regents of the University of California 3.00%, 4/1/99 1,000
Refunding Revenue Bonds, Series C, ML/SG 10,000 Ventura County TRAN, Series 1998-99,
Muni Trust SG-24 (AMBAC Insured), 2.85%, 2.90%, 4/7/99 10,000
4/7/99 4,390 3,000 Whittier Union High School District
TRAN, 3.55%, 6/30/99 3,005
</TABLE>
See Notes to the Financial Statements.
- -----
36
- -----
<PAGE> 38
NORTHERN FUNDS Annual Report
SCHEDULES OF INVESTMENTS MARCH 31, 1999
CALIFORNIA MUNICIPAL MONEY MARKET FUND (continued)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
- -----------------------------------------------------------------------
<S> <C> <C>
CALIFORNIA - 93.3% (CONT'D.)
$2,000 Yucaipa-Calimesa Joint Unified School
District TRAN, Series 1998-99,
3.55%, 6/30/99 2,002
--------
338,890
--------
PUERTO RICO - 5.0%
Government Development Bank for Puerto
Rico Tax-Exempt CP
3,400 2.65%, 5/20/99 3,400
7,000 2.85%, 5/20/99 7,000
3,000 Puerto Rico Commonwealth Highway
and Transportation Authority
Transportation Revenue Bond,
Series A (AMBAC Insured),
2.65%, 4/7/99 3,000
4,500 Puerto Rico Commonwealth TRAN,
Series 1998, 2.88%, 7/30/99 4,508
--------
17,908
--------
Total Municipal Investments
(cost $356,798) 356,798
--------
NUMBER
OF SHARES
(000s)
- ---------
OTHER - 0.1%
313 Federated Tax-Exempt
Money Market Fund No. 80 313
255 Provident Institutional California
Money Fund 255
-------
Total Other
(cost $568) 568
-------
Total Investments - 98.4%
(cost $357,366) 357,366
Other Assets less Liabilities - 1.6% 5,684
--------
NET ASSETS - 100.0% $363,050
========
</TABLE>
See Notes to the Financial Statements.
-----
37
-----
<PAGE> 39
NOTES TO THE
FINANCIAL STATEMENTS
MARCH 31, 1999
1. ORGANIZATION
Northern Funds was organized October 12, 1993 as a Massachusetts business trust
and is registered under the Investment Company Act of 1940 as an open-end
management investment company. The Money Market, U.S. Government Money Market,
U.S. Government Select Money Market, Municipal Money Market and California
Municipal Money Market Funds (collectively the "Funds") are separate,
diversified investment portfolios of Northern Funds, except the California
Municipal Money Market Fund which is a non-diversified portfolio of Northern
Funds. Non-diversified portfolios may invest a relatively high percentage of
their net assets in obligations of a limited number of issuers. Each of the
Funds maintains its own investment objective.
The Funds have entered into an Investment Advisory Agreement with The
Northern Trust Company ("Northern Trust" or the "Adviser"). Northern Trust also
serves as custodian, fund accountant and transfer agent for the Funds.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds. These policies are in conformity with generally accepted
accounting principles ("GAAP"). The preparation of financial statements in
conformity with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. VALUATION OF SECURITIES - Short-term investments held by the Funds are
valued using the amortized cost method, which approximates market value.
Under this method, investments purchased at a discount or premium are
valued by amortizing the difference between the original purchase price and
maturity value of the issue over the period to maturity. Insurance funding
agreements are valued at cost plus accrued interest, which approximates
market value. Any securities for which no current quotations are readily
available are valued at fair value as determined in good faith by the
Adviser under the supervision of the Board of Trustees.
B. REPURCHASE AGREEMENTS - During the term of a repurchase agreement, the
market value of the underlying collateral, including accrued interest, is
required to equal or exceed the market value of the repurchase agreement.
The underlying collateral for all repurchase agreements is held in a
customer-only account of Northern Trust, as custodian for the Funds, at the
Federal Reserve Bank of Chicago.
C. ORGANIZATION COSTS - Organization expenses of approximately $342,000 have
been deferred and are being amortized on a straight-line basis through
1999. These costs were deferred and amortized during the five year period
ending March 31, 1999.
D. INVESTMENT TRANSACTIONS AND INCOME - Investment transactions are recorded
as of the trade date. The Funds determine the gain or loss realized from
investment transactions by using an identified cost basis method. Interest
income is recognized on an accrual basis and includes amortization of
discounts and premiums.
E. EXPENSES - The Funds are charged for those expenses that are directly
attributable to each Fund. Expenses that are not directly attributable to a
Fund are typically allocated among the Funds in proportion to their
respective net assets.
F. DISTRIBUTIONS TO SHAREHOLDERS - Dividends from net investment income are
declared daily and paid monthly.
Distributions of net realized capital gains, if any, are declared at
least annually. Distributions to shareholders are recorded on the
ex-dividend date.
The timing and character of distributions determined in accordance with
federal income tax regulations may differ from financial statement amounts
determined in accordance with generally accepted accounting principles due
to differences in the treatment and recognition of investment income and
realized gains (losses). These differences are primarily related to capital
loss carryforwards. Certain differences in treatment of income and capital
gains for distributions, which are permanent, may result in periodic
reclassifications in the Funds' capital accounts.
- -----
38
- -----
<PAGE> 40
During the year ended March 31, 1999, all of the dividends derived from
net investment income paid by the Municipal Money Market and California
Municipal Money Market Funds were "exempt-interest dividends," excludable
from gross income for Federal income tax purposes. Further, all such
dividends paid by the California Municipal Money Market Fund were
"California exempt-interest dividends," exempt from California state
personal income tax.
G. FEDERAL INCOME TAXES - No provision for federal income taxes has been made
since the Funds intend to comply with the requirements of the Internal
Revenue Code available to regulated investment companies and to distribute
substantially all of their taxable income to their shareholders.
3. INVESTMENT ADVISORY AND OTHER AGREEMENTS
Pursuant to its advisory agreement with the Funds, the Adviser is entitled to
receive a fee, calculated daily and payable monthly, at the annual rates
presented below as applied to each Fund's daily net assets. For the year ended
March 31, 1999, the Adviser voluntarily agreed to waive a portion of its
advisory fees as applied to each Fund's daily net assets as shown on the
accompanying Statements of Operations. Northern Trust had also agreed to
reimburse the Funds as shown on the accompanying Statements of Operations to
adhere to the expense limitations presented in the following table:
<TABLE>
<CAPTION>
Annual Advisory
Advisory Fees After Expense
Fees Waivers Limitations
- -------------------------------------------------------------
<S> <C> <C> <C>
Money Market 0.60% 0.40% 0.55%
U.S. Government
Money Market 0.60% 0.40% 0.55%
U.S. Government Select
Money Market 0.60% 0.40% 0.55%
Municipal Money
Market 0.60% 0.40% 0.55%
California Municipal
Money Market 0.60% 0.40% 0.55%
- -------------------------------------------------------------
</TABLE>
The Funds have entered into an administrative agreement with Sunstone
Financial Group, Inc. ("Sunstone") for certain administrative services. Pursuant
to its administrative agreement with the Funds, Sunstone is entitled to receive
a fee, computed daily and payable monthly, at the annual rate of 0.15% of each
Fund's daily net assets. For the year ended March 31, 1999, Sunstone voluntarily
agreed to waive a portion of its administration fees as shown on the
accompanying Statements of Operations. The waivers and reimbursements of
Northern Trust and Sunstone described above are voluntary and may be terminated
by them at any time at their discretion.
4. BANK LOANS
The Funds maintain a $5,000,000 revolving bank credit line for liquidity and
other purposes. Borrowings under this arrangement bear interest at 1% above the
Fed Funds rate and are secured by pledged securities equal to or exceeding 120%
of the outstanding balance.
As of March 31, 1999, there were no outstanding borrowings.
-----
39
-----
<PAGE> 41
REPORT OF INDEPENDENT
PUBLIC ACCOUNTANTS
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES:
NORTHERN FUNDS MONEY MARKET FUND,
U.S. GOVERNMENT MONEY MARKET FUND,
U.S. GOVERNMENT SELECT MONEY MARKET FUND, MUNICIPAL MONEY MARKET FUND,
CALIFORNIA MUNICIPAL MONEY MARKET FUND
We have audited the accompanying statements of assets and liabilities of
Northern Funds (a Massachusetts business trust consisting of the Money Market
Fund, U.S. Government Money Market Fund, U.S. Government Select Money Market
Fund, Municipal Money Market Fund and California Municipal Money Market Fund,
including the schedules of investments, as of March 31, 1999, and the related
statements of operations, changes in net assets, and the financial highlights
for the periods indicated thereon. These financial statements and financial
highlights are the responsibility of the Funds' 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 March
31, 1999, by physical examination of the securities held by the custodian and by
correspondence with outside depositories and brokers. 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 each
of the respective portfolios constituting Northern Funds as of March 31, 1999,
the results of their operations, changes in their net assets, and financial
highlights for the periods indicated thereon, in conformity with generally
accepted accounting principles.
ARTHUR ANDERSEN LLP
Chicago, Illinois
May 14, 1999
- -----
40
- -----
<PAGE> 42
This report has been prepared for the general information of Northern Funds
shareholders. It is not authorized for distribution to prospective investors
unless accompanied or preceded by a current Northern Funds prospectus, which
contains more complete information about Northern Funds investment policies,
management fees and expenses. Investors are reminded to read the prospectus
carefully before investing or sending money.
NF4090599
(C) 1999 Northern Funds Distributors, LLC, Distributor
[NORTHERN FUNDS LOGO]
P.O. Box 2081
Milwaukee, WI 53201-9800
1-800-595-9111
