<PAGE>
[NORTHERN FUNDS LOGO]
-------------------------------------------------------------------------------
MONEY MARKET SEMIANNUAL
-------------------------------------------------------------------------------
[GRAPHIC PHOTO OF ABACUS]
[GRAPHIC PHOTO OF GEARS]
[GRAPHIC PHOTO OF STONES]
September 30, 2000
<PAGE>
TABLE OF CONTENTS PAGE
Abbreviations and Other Information ......................................... 1
Statements of Assets and Liabilities .................................... 2
Statements of Operations ................................................ 3
Statements of Changes in Net Assets ..................................... 4
Financial Highlights .................................................... 6
Schedules of Investments
Money Market Fund ................................................... 11
U.S. Government Money Market Fund ................................... 17
U.S. Government Select Money Market Fund ............................ 18
Municipal Money Market Fund ......................................... 19
California Municipal Money Market Fund .............................. 38
Notes to the Financial Statements ........................................... 43
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK.
<PAGE>
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.
Maturity dates represent the stated date on the security, the next interest
reset date or next putable dates for floating rate securities or the prerefunded
date for these types of securities.
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.
EXPLANATION OF ABBREVIATIONS USED THROUGHOUT THE SCHEDULES OF INVESTMENTS
AMBAC American Municipal Bond Assurance Corp.
AMT Alternative Minimum Tax
BAN Bond Anticipation Notes
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
FNMA Fannie Mae
FRN Floating Rate Note
FSA Financial Security Assurance
GIC Guaranteed Investment Contract
GNMA Government National Mortgage Association
G.O. General Obligation
GTD. Guaranteed
HDA Housing Development Agency
HFA Housing Finance Authority
IDA Industrial Development Authority
IDR Industrial Development Revenue
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
ML/SG Merrill Lynch Societe Generale
MTN Medium Term Notes
P-FLOATS Puttable Floating Rate Securities
PCR Pollution Control Revenue
PSF Permanent School Fund
RAN Revenue Anticipation Notes
ROC Reset Option Certificates
SFM Single Family Mortgage
SLMA SLM Holding Corp.
SOC GEN Societe Generale
TAN Tax Anticipation Notes
TOB Tender Option Bond
TRAN Tax and Revenue Anticipation Notes
TRB Tax Revenue Bonds
VRDB Variable Rate Demand Bond
VRDN Variable Rate Demand Notes
VRN Variable Rate Notes
----------------------
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.
1
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES SEPTEMBER 30, 2000 (UNAUDITED)
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 $5,740,472 $270,060 $721,341 $2,679,221 $461,141
Repurchase agreements, at cost which approximates market value 650,000 239,000 -- -- --
Cash 167 9 112 -- --
Income receivable 32,936 1,220 1,376 24,737 4,586
Receivable for securities sold -- -- -- -- 1,100
Receivable from Adviser 152 13 17 60 11
Prepaid and other assets 150 25 5 54 3
------------------------------------------------------------------------------------------------------------------------------------
Total Assets 6,423,877 510,327 722,851 2,704,072 466,841
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Cash overdraft -- -- -- 272 7
Dividends payable 33,033 2,495 3,530 8,567 1,197
Payable for securities purchased -- 28,799 -- -- --
Accrued investment advisory fees 423 32 46 177 30
Accrued administration fees 158 12 17 67 11
Accrued transfer agent fees 106 8 11 44 7
Accrued custody and accounting fees -- -- 5 -- 2
Accrued registration fees and other liabilities 539 31 48 155 31
------------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 34,259 31,377 3,657 9,282 1,285
------------------------------------------------------------------------------------------------------------------------------------
Net Assets $6,389,618 $478,950 $719,194 $2,694,790 $465,556
------------------------------------------------------------------------------------------------------------------------------------
ANALYSIS OF NET ASSETS:
Capital stock $6,389,469 $478,910 $719,167 $2,694,513 $465,521
Undistributed net investment income 160 33 21 207 20
Undistributed net realized gains (losses) (11) 7 6 70 15
------------------------------------------------------------------------------------------------------------------------------------
Net Assets $6,389,618 $478,950 $719,194 $2,694,790 $465,556
------------------------------------------------------------------------------------------------------------------------------------
SHARES OUTSTANDING ($.0001 PAR VALUE, UNLIMITED AUTHORIZATION) 6,389,589 478,943 719,188 2,694,649 465,542
NET ASSET VALUE, REDEMPTION AND OFFERING PRICE PER SHARE $1.00 $1.00 $1.00 $1.00 $1.00
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
2
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
NORTHERN FUNDS Semiannual Report
STATEMENTS OF OPERATIONS SIX MONTHS ENDED SEPTEMBER 30, 2000 (UNAUDITED)
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 $212,160 $15,838 $23,028 $57,642 $8,209
-----------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment advisory fees 19,335 1,466 2,156 7,954 1,285
Administration fees 4,834 366 539 1,988 321
Transfer agent fees 3,223 244 359 1,326 214
Custody and accounting fees 626 64 89 210 65
Registration fees 496 38 45 160 37
Professional fees 130 9 14 49 10
Trustees' fees and expenses 102 5 6 30 5
Servicing fee -- 38 -- -- --
Other 243 21 21 94 22
-----------------------------------------------------------------------------------------------------------------------------------
Total Expenses 28,989 2,251 3,229 11,811 1,959
Less voluntary waivers of investment advisory fees (6,445) (488) (719) (2,651) (428)
Less reimbursement of expenses by Adviser (4,818) (419) (534) (1,869) (353)
-----------------------------------------------------------------------------------------------------------------------------------
Net Expenses 17,726 1,344 1,976 7,291 1,178
-----------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 194,434 14,494 21,052 50,351 7,031
-----------------------------------------------------------------------------------------------------------------------------------
Net Realized Gains (Losses) on Investments 8 -- -- (39) (12)
-----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $194,442 $14,494 $21,052 $50,312 $7,019
</TABLE>
3
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
U.S. GOVERNMENT
MONEY MARKET MONEY MARKET
FUND FUND
----------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED
2000 MARCH 31, 2000 MARCH 31,
AMOUNTS IN THOUSANDS (UNAUDITED) 2000 (UNAUDITED) 2000
----------------------------------------------------- ----------------------------- -----------------------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment income $194,434 $264,791 $14,494 $22,074
Net realized gains (losses) on investments 8 (19) -- --
--------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting
from Operations 194,442 264,772 14,494 22,074
--------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
Shares sold 11,725,251 23,568,489 1,016,466 2,348,124
Shares from reinvestment of dividends 50,228 54,450 5,911 7,464
Shares redeemed (11,623,100) (22,271,787) (1,081,377) (2,287,504)
--------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Capital Share Transactions 152,379 1,351,152 (59,000) 68,084
--------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS PAID:
From net investment income (194,434) (264,791) (14,494) (22,074)
--------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS 152,387 1,351,133 (59,000) 68,084
NET ASSETS:
Beginning of year 6,237,231 4,886,098 537,950 469,866
--------------------------------------------------------------------------------------------------------------------------
End of period $6,389,618 $6,237,231 $478,950 $537,950
--------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME $160 $160 $33 $33
--------------------------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
4
<PAGE>
<TABLE>
Northern Funds Semiannual Report
<CAPTION>
U.S. GOVERNMENT CALIFORNIA
SELECT MUNICIPAL MUNICIPAL
MONEY MARKET MONEY MARKET MONEY MARKET
FUND FUND FUND
-------------------------- ---------------------------- -----------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED SEPT. 30, ENDED
2000 MARCH 31, 2000 MARCH 31, 2000 MARCH 31,
AMOUNTS IN THOUSANDS (UNAUDITED) 2000 (UNAUDITED) 2000 (UNAUDITED) 2000
------------------------------ -------------------------- ---------------------------- -----------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income $21,052 $27,170 $50,351 $69,410 $7,031 $10,954
Net realized gains (losses)
on investments -- 3 (39) (119) (12) (4)
------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net
Assets Resulting
from Operations 21,052 27,173 50,312 69,291 7,019 10,950
------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
Shares sold 1,749,654 3,693,357 5,068,209 9,836,179 1,136,203 2,140,034
Shares from reinvestment
of dividends 7,793 8,643 9,340 11,271 1,468 3,353
Shares redeemed (1,727,995) (3,428,788) (5,050,816) (9,563,265) (1,076,720) (2,101,816)
------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease)
in Net Assets Resulting
from Capital Share
Transactions 29,452 273,212 26,733 284,185 60,951 41,571
------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS PAID:
From net investment income (21,052) (27,170) (50,351) (69,410) (7,031) (10,954)
------------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS 29,452 273,215 26,694 284,066 60,939 41,567
NET ASSETS:
Beginning of year 689,742 416,527 2,668,096 2,384,030 404,617 363,050
------------------------------------------------------------------------------------------------------------------------------
End of period $719,194 $689,742 $2,694,790 $2,668,096 $465,556 $404,617
------------------------------------------------------------------------------------------------------------------------------
ACCUMULATED UNDISTRIBUTED NET
INVESTMENT INCOME $21 $21 $207 $207 $20 $20
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
FINANCIAL HIGHLIGHTS
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
MONEY MARKET
FUND
--------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
SEPT. 30, ENDED ENDED ENDED ENDED ENDED
2000 MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
(UNAUDITED) 2000 1999 1998 1997 1996
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <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 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.03 0.05 0.05 0.05 0.05 0.05
---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.03) (0.05) (0.05) (0.05) (0.05) (0.05)
---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(1) 3.05% 5.06% 5.04% 5.31% 5.05% 5.57%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of period $6,389,618 $6,237,231 $4,886,098 $3,296,030 $1,607,187 $1,061,813
Ratio to average net assets of (2):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.55% 0.55% 0.49%
Expenses, before waivers and
reimbursements 0.90% 0.89% 0.89% 0.90% 0.90% 0.91%
Net investment income, net of
waivers and reimbursements 6.03% 4.96% 4.91% 5.19% 4.94% 5.42%
Net investment income, before
waivers and reimbursements 5.68% 4.62% 4.57% 4.84% 4.59% 5.00%
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) 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.
(2) Annualized for periods less than a full year.
SEE NOTES TO THE FINANCIAL STATEMENTS.
6
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
U.S. GOVERNMENT
MONEY MARKET
FUND
-----------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
SEPT. 30, ENDED ENDED ENDED ENDED ENDED
2000 MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
(UNAUDITED) 2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <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 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.03 0.05 0.05 0.05 0.05 0.05
----------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.03) (0.05) (0.05) (0.05) (0.05) (0.05)
----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(1) 3.01% 4.92% 4.94% 5.22% 4.93% 5.46%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of period $478,950 $537,950 $469,866 $417,042 $314,259 $207,105
Ratio to average net assets of (2):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.55% 0.55% 0.49%
Expenses, before waivers and
reimbursements 0.92% 0.92% 0.91% 0.93% 0.96% 0.94%
Net investment income, net of
waivers and reimbursements 5.93% 4.82% 4.82% 5.10% 4.82% 5.33%
Net investment income, before
waivers and reimbursements 5.56% 4.45% 4.46% 4.72% 4.41% 4.88%
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) 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.
(2) Annualized for periods less than a full year.
SEE NOTES TO THE FINANCIAL STATEMENTS.
7
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED)
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
U.S. GOVERNMENT
SELECT
MONEY MARKET
FUND
---------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
SEPT. 30, ENDED ENDED ENDED ENDED ENDED
2000 MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
(UNAUDITED) 2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <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 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.03 0.05 0.05 0.05 0.05 0.05
----------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.03) (0.05) (0.05) (0.05) (0.05) (0.05)
----------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
----------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(1) 2.96% 4.86% 4.87% 5.24% 5.07% 5.55%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of period $719,194 $689,742 $416,527 $306,425 $168,128 $85,400
Ratio to average net assets of (2):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.46% 0.40% 0.33%
Expenses, before waivers and
reimbursements 0.90% 0.90% 0.91% 0.93% 0.97% 1.00%
Net investment income, net of
waivers and reimbursements 5.86% 4.86% 4.73% 5.13% 4.95% 5.43%
Net investment income, before
waivers and reimbursements 5.51% 4.51% 4.37% 4.66% 4.38% 4.76%
----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) 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.
(2) Annualized for periods less than a full year.
SEE NOTES TO THE FINANCIAL STATEMENTS.
8
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
MUNICIPAL
MONEY MARKET
FUND
-----------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
SEPT. 30, ENDED ENDED ENDED ENDED ENDED
2000 MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
(UNAUDITED) 2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <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 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.02 0.03 0.03 0.03 0.03 0.03
----------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.02) (0.03) (0.03) (0.03) (0.03) (0.03)
----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(1) 1.91% 3.01% 2.98% 3.27% 3.14% 3.54%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of period $2,694,790 $2,668,096 $2,384,030 $1,814,343 $1,420,041 $1,102,789
Ratio to average net assets of (2):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.55% 0.55% 0.49%
Expenses, before waivers and
reimbursements 0.89% 0.90% 0.89% 0.89% 0.90% 0.91%
Net investment income, net of
waivers and reimbursements 3.80% 2.96% 2.90% 3.20% 3.08% 3.46%
Net investment income, before
waivers and reimbursements 3.46% 2.61% 2.56% 2.86% 2.73% 3.04%
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) 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.
(2) Annualized for periods less than a full year.
SEE NOTES TO THE FINANCIAL STATEMENTS.
9
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED)
MONEY MARKET FUNDS
<TABLE>
<CAPTION>
CALIFORNIA MUNICIPAL
MONEY MARKET
FUND
-----------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
SEPT. 30, ENDED ENDED ENDED ENDED ENDED
2000 MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
(UNAUDITED) 2000 1999 1998 1997 1996
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <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 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.02 0.03 0.03 0.03 0.03 0.04
----------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS PAID:
From net investment income (0.02) (0.03) (0.03) (0.03) (0.03) (0.04)
----------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
----------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(1) 1.65% 2.64% 2.75% 3.20% 3.19% 3.63%
SUPPLEMENTAL DATA AND RATIOS:
Net assets, in thousands, end of period $465,556 $404,617 $363,050 $224,843 $200,989 $165,087
Ratio to average net assets of (2):
Expenses, net of waivers and
reimbursements 0.55% 0.55% 0.55% 0.49% 0.45% 0.39%
Expenses, before waivers and
reimbursements 0.91% 0.91% 0.91% 0.94% 0.94% 0.94%
Net investment income, net of
waivers and reimbursements 3.28% 2.61% 2.68% 3.14% 3.13% 3.55%
Net investment income, before
waivers and reimbursements 2.92% 2.25% 2.32% 2.69% 2.64% 3.00%
----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) 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.
(2) Annualized for periods less than a full year.
SEE NOTES TO THE FINANCIAL STATEMENTS.
10
<PAGE>
NORTHERN FUNDS Semiannual Report
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MONEY MARKET FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
-----------------------------------------------------------------------------
<S> <C> <C>
CERTIFICATES OF DEPOSIT - 10.8%
DOMESTIC CERTIFICATES OF DEPOSIT - 5.1%
$ 90,000 First Union National Bank,
North Carolina
7.00%, 7/30/01 $ 90,000
National Westminster Bank
50,000 6.10%, 11/24/00 49,995
95,000 7.24%, 5/21/01 95,000
50,000 Regions Bank
6.23%, 11/6/00 49,996
Southtrust Bank, N.A.
20,000 6.80%, 2/8/01 20,000
20,000 6.70%, 3/5/01 20,000
----------
324,991
----------
FOREIGN CERTIFICATES OF DEPOSIT - 5.7%
100,000 Canadian Imperial Bank
of Commerce
7.42%, 5/22/01 100,000
100,000 Royal Bank of Canada, New York Branch
7.42%, 5/22/01 100,000
Societe Generale, New York Branch
145,000 6.89%, 3/29/01 144,980
20,000 7.42%, 5/21/01 20,000
----------
364,980
----------
Total Certificates of Deposit
(cost $689,971) 689,971
----------
COMMERCIAL PAPER - 49.2%
ASSET-BACKED SECURITIES - 4.0%
Moriarty Ltd.
129,000 6.67%, 10/5/00 128,904
42,500 6.52%, 2/26/01 41,361
65,000 6.49%, 3/1/01 63,231
25,000 Victory Receivables Corp.
6.53%, 10/20/00 24,914
----------
258,410
----------
COLLATERIZED LOAN OBLIGATIONS - 2.0%
Moat Funding LLC
$ 30,000 6.51%, 11/21/00 $ 29,723
25,850 6.50%, 11/28/00 25,579
27,878 R.O.S.E., Inc.
6.56%, 10/30/00 27,731
Stellar Funding, Inc.
18,045 6.54%, 10/6/00 18,029
20,114 6.54%, 10/10/00 20,081
2,847 6.60%, 11/9/00 2,827
1,907 6.60%, 11/13/00 1,892
1,018 6.60%, 11/21/00 1,008
----------
126,870
----------
DOMESTIC DEPOSITORY INSTITUTIONS - 1.4%
90,000 Marshall & Ilsley Corp.
6.625%, 11/27/00 89,056
----------
ELECTRIC SERVICES - 0.2%
16,100 Southern Co.
6.60%, 11/20/00 15,952
----------
FOREIGN DEPOSITORY INSTITUTIONS - 1.2%
Swedbank, Inc.
30,000 6.57%, 10/5/00 29,973
45,000 6.57%, 10/6/00 44,967
----------
74,940
----------
INSURANCE - 2.8%
Aetna Service Co.
10,000 6.60%, 11/16/00 9,916
15,000 6.58%, 11/21/00 14,860
10,000 6.58%, 11/28/00 9,894
25,000 6.58%, 11/29/00 24,730
AON Corp.
12,500 6.53%, 10/12/00 12,475
15,000 6.53%, 10/18/00 14,954
9,500 6.53%, 10/20/00 9,467
17,000 6.50%, 12/27/00 16,733
Torchmark, Inc.
10,500 6.63%, 10/3/00 10,496
13,000 6.60%, 10/25/00 12,943
13,000 6.52%, 12/4/00 12,849
27,500 United Healthcare Corp.
6.55%, 10/27/00 27,370
----------
176,687
----------
</TABLE>
11
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
-----------------------------------------------------------------------------
<S> <C> <C>
COMMERCIAL PAPER - 49.2% (CONT'D)
MANUFACTURING INDUSTRY - 0.6%
Cooper Industries, Inc.
$ 12,500 6.58%, 10/16/00 $ 12,466
10,000 6.61%, 10/23/00 9,959
15,000 6.55%, 11/9/00 14,894
----------
37,319
----------
MULTI-SELLER CONDUITS - 21.3%
12,500 Amsterdam Funding
6.55%, 10/20/00 12,457
Apreco, Inc.
18,562 6.55%, 10/4/00 18,552
12,300 6.52%, 10/20/00 12,258
15,000 6.52%, 10/24/00 14,938
25,000 6.51%, 12/14/00 24,665
Bavaria Universal Funding Corp.
38,000 6.54%, 10/2/00 37,993
20,000 6.52%, 10/13/00 19,957
50,000 6.52%, 10/16/00 49,864
10,000 6.53%, 10/25/00 9,956
Blue Ridge Asset Funding Corp.
16,300 6.52%, 10/4/00 16,291
16,681 6.65%, 10/5/00 16,669
6,723 6.52%, 10/10/00 6,712
22,500 6.57%, 10/12/00 22,455
8,000 6.52%, 10/18/00 7,975
10,000 6.52%, 10/23/00 9,960
Concord Minutemen Capital Co.
38,753 6.53%, 10/12/00 38,676
15,000 6.54%, 10/19/00 14,924
50,000 6.58%, 10/23/00 49,799
5,000 Eiffel Funding LLC
6.53%, 10/19/00 4,984
High Peak Funding LLC
38,700 6.57%, 10/13/00 38,615
13,500 6.54%, 10/16/00 13,463
10,000 6.52%, 12/6/00 9,880
11,000 6.52%, 12/7/00 10,867
12,250 6.53%, 12/18/00 12,077
Jupiter Securitization Corp.
$ 19,150 6.53%, 10/3/00 $ 19,143
50,000 6.52%, 10/13/00 49,891
13,680 6.56%, 10/27/00 13,615
6,782 6.52%, 11/20/00 6,721
12,700 6.52%, 11/27/00 12,569
15,000 6.53%, 11/28/00 14,842
50,000 KBC Commercial Paper Trust
6.53%, 10/26/00 49,773
Kitty Hawk Funding Corp.
71,700 6.48%, 12/1/00 70,913
34,000 6.48%, 12/15/00 33,541
Lexington Parker Capital
47,000 6.52%, 11/16/00 46,608
14,140 6.50%, 12/1/00 13,984
50,000 6.55%, 2/23/01 48,683
25,000 6.50%, 3/1/01 24,318
33,000 Market Street Funding
6.56%, 10/13/00 32,928
Ness LLC
10,000 6.55%, 10/2/00 9,998
25,000 6.60%, 10/5/00 24,982
20,000 6.53%, 11/8/00 19,862
10,000 6.50%, 2/21/01 9,742
29,111 Quincy Capital Corp.
6.52%, 10/10/00 29,064
93,100 Sheffield Receivables Corp.
6.54%, 10/13/00 92,897
Silver Tower U.S. Funding
18,475 6.52%, 2/15/01 18,018
15,000 6.52%, 2/23/01 14,606
10,000 6.49%, 3/5/01 9,721
Tannehill Capital Co. LLC
25,000 6.63%, 10/10/00 24,959
14,000 6.60%, 10/23/00 13,944
Twin Towers, Inc.
120,000 6.57%, 10/24/00 119,535
Westways Funding IV, Ltd.
18,000 6.53%, 11/3/00 17,892
12,500 6.53%, 11/20/00 12,386
9,000 6.53%, 11/30/00 8,902
20,000 Windmill Funding,
6.52%, 10/12/00 19,960
----------
1,357,984
----------
</TABLE>
12
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
-----------------------------------------------------------------------------
<S> <C> <C>
NON-DEPOSITORY BUSINESS CREDIT
INSTITUTIONS - 0.6%
$ 25,000 Centric Capital Corp.
6.65%, 10/5/00 $ 24,982
15,000 Duke Capital Corp.
6.54%, 11/7/00 14,899
----------
39,881
----------
NON-DEPOSITORY PERSONAL CREDIT
INSTITUTIONS - 1.4%
14,000 AEP Credit, Inc.
6.49%, 12/22/00 13,793
Heller Financial, Inc., MTN
8,000 6.65%, 11/3/00 7,951
8,000 6.625%, 11/22/00 7,923
25,000 6.60%, 12/8/00 24,689
22,000 6.60%, 12/13/00 21,706
15,000 Household Finance Co.
6.56%, 10/13/00 14,967
----------
91,029
----------
OTHER RECEIVABLES - 1.0%
62,500 Dakota Certificates Program
6.55%, 10/19/00 62,295
----------
SECURITIES ARBITRAGE - 9.4%
Conduit Asset Backed Securities LLC
20,000 6.55%, 10/16/00 19,945
10,000 6.50%, 12/1/00 9,890
10,000 6.51%, 12/12/00 9,870
Crown Point Capital Co.
24,000 6.52%, 11/16/00 23,800
45,000 6.55%, 2/20/01 43,837
Grand Funding Corp.
25,000 6.53%, 10/5/00 24,982
14,400 6.54%, 10/20/00 14,350
25,000 6.53%, 10/24/00 24,896
37,450 6.53%, 10/25/00 37,287
11,300 6.52%, 10/26/00 11,249
17,000 Grayhawk Funding
6.55%, 10/20/00 16,941
37,000 Lockhart Funding LLC
6.62%, 12/21/00 36,449
K2 USA LLC
$ 18,000 6.33%, 10/23/00 $ 17,930
13,500 6.33%, 10/25/00 13,443
7,500 6.52%, 11/20/00 7,432
8,500 6.82%, 11/24/00 8,413
32,000 6.82%, 11/28/00 31,648
12,000 6.50%, 12/1/00 11,868
15,000 6.52%, 2/26/01 14,598
5,000 6.50%, 2/28/01 4,865
MPF Ltd.
17,500 6.57%, 10/27/00 17,417
22,500 6.55%, 11/3/00 22,365
18,000 6.55%, 11/14/00 17,856
36,725 6.55%, 11/21/00 36,384
15,000 6.53%, 11/28/00 14,842
10,000 6.55%, 12/7/00 9,878
15,000 North Coast Funding LLC
6.57%, 10/27/00 14,932
Sigma Finance
36,000 6.53%, 2/22/01 35,060
50,000 6.53%, 3/2/01 48,622
----------
601,049
----------
SINGLE SELLER CONDULTS - 1.6%
40,000 Bills Securitization Ltd.
6.50%, 11/15/00 39,675
Emerald Certificates -
MBNA Credit Card Trust II CPN
29,000 6.58%, 10/4/00 28,984
20,000 6.55%, 10/19/00 19,934
15,000 6.57%, 10/30/00 14,921
----------
103,514
----------
TRANSPORTATION EQUIPMENT - 1.7%
General Motors Acceptance Corp., Canada
25,000 6.53%, 3/12/01 24,266
10,000 6.52%, 3/27/01 9,679
10,000 6.52%, 3/27/01 9,679
Textron Financial Corp.
32,500 6.52%, 11/20/00 32,206
30,000 6.52%, 11/21/00 29,723
----------
105,553
----------
Total Commercial Paper
(cost $3,140,539) 3,140,539
----------
</TABLE>
13
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
-----------------------------------------------------------------------------
<S> <C> <C>
CORPORATE NOTES/BONDS - 14.7%
COLLATERALIZED LOAN OBLIGATIONS - 2.0%
Syndicated Loan Funding Trust
Senior Secured Notes, Series 1999-5
$ 40,000 6.77%, 10/16/00 $ 40,000
35,000 6.77%, 2/15/01 34,983
50,000 6.77%, 3/15/01 50,000
----------
124,983
----------
COMMUNICATIONS - 0.8%
50,000 AT&T Corporation FRN
6.65%, 7/19/01 50,000
----------
DOMESTIC DEPOSITORY INSTITUTION - 1.2%
7,460 ADE Investments LLC Loan
Program VRN, Series 1998 - A
6.67%, 10/7/00 7,460
3,050 Vreba-Hoff Funding Inc., Loan
Notes, Series 1998 - A
6.67%, 10/7/00 3,050
65,586 Strategic Money Market Trust FRN
6.78%, 3/29/01 65,586
----------
76,096
----------
FOREIGN DEPOSITORY INSTITUTIONS - 0.8%
50,000 Abbey National Treasury FRN
6.57%, 10/25/01 49,984
----------
HEALTH SERVICES - 0.1%
4,600 Smith Clinic Project Taxable VRDN
6.70%, 10/7/00 4,600
----------
INSURANCE - 1.2%
75,000 United Healthcare Corp. FRN
6.94%, 11/10/00 75,000
----------
MANUFACTURING - 1.4%
90,000 Unilever Capital Corp.
6.68%, 9/7/01 90,000
----------
NON-DEPOSITORY PERSONAL CREDIT
INSTITUTIONS - 0.6%
40,000 Associates Corp. of North America FRN
6.65%, 10/1/01 40,000
----------
REAL ESTATE - 0.1%
$ 5,165 Bonbright Distributors, Inc.
Taxable VRDN
6.70%, 10/07/00 $ 5,165
3,350 Wilmington Pike, LLC Project
VRDN, Series 2000
6.70%, 10/07/00 3,350
----------
8,515
----------
SECURITIES ARBITRAGE - 4.4%
Dorada Finance Corp.
40,000 7.20%, 5/8/01 40,000
20,000 6.73%, 9/25/01 20,000
17,500 6.75%, 9/27/01 17,500
K2 (USA) LLC, MTN
30,000 6.90%, 3/30/01 30,000
28,000 7.44%, 4/30/01 28,000
25,000 6.75%, 9/26/01 25,000
50,000 Liberty Lighthouse, U.S. Capital MTN
6.15%, 10/13/00 50,000
25,000 Links Finance Corp. LLC
7.46%, 5/22/01 25,000
50,000 Sigma Finance
6.73%, 9/21/01 50,000
----------
285,500
----------
SECURITY & COMODITY BROKER/
DEALERS - 1.5%
100,000 Lehman Brothers FRN
6.75%, 10/2/00 100,000
----------
TRANSPORTATION EQUIPMENT - 0.6%
37,500 General Motors Acceptance Corp. FRN
6.61%, 4/27/01 37,500
----------
Total Corporate Notes/Bonds
(cost $942,178) 942,178
----------
EURODOLLAR TIME DEPOSITS - 9.0%
200,000 Barclays Bank, Global Treasury
Eurodollar Time Deposit
6.72%, 10/2/00 200,000
</TABLE>
14
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
-----------------------------------------------------------------------------
<S> <C> <C>
$120,606 Commerzbank, Frankfurt
Eurodollar Time Deposit
6.72%, 10/2/00 $ 120,606
22,754 FIRSTAR, Grand Cayman
Eurodollar Time Deposit
6.69%, 10/2/00 22,754
144,609 Key Bank, N.A. Grand Cayman
Eurodollar Time Deposit
6.69%, 10/2/00 144,609
90,000 Skandinaviska Enskildabanken, Grand
Cayman, Eurodollar Time Deposit
6.75%, 10/2/00 90,000
----------
Total Eurodollar Time Deposits
(cost $577,969) 577,969
----------
MUNICIPAL INVESTMENTS - 6.1%
ADMINISTRATION OF ENVIRONMENT
& HOUSING PROGRAMS - 3.5%
37,250 Alaska Housing Finance Corp.
6.55%, 12/4/00 36,816
57,250 California HFA Home Mortgage
Revenue Bond, Series R
6.60%, 10/7/00 57,250
125,810 Virginia State Housing Development
Authority Bond, Commonwealth
Mortgage
6.65%, 10/7/00 125,810
----------
219,876
----------
BUSINESS SERVICES - 0.8%
4,250 Courtyards of Mackinaw LLC
Mortgage Revenue Bond, Series 1999 - H
6.67%, 10/7/00 4,250
13,500 Elsmere, Kentucky Mubea, Inc.
6.70%, 10/7/00 13,500
3,800 FBC Chemical Corp. Taxable VRN
(National City Bank LOC)
6.70%, 10/7/00 3,800
5,825 KBL Capital Fund, Inc. Loan
Program Note, Series 1999 - A
6.67%, 10/7/00 5,825
4,050 Malone College Project VRN
6.25%, 10/7/00 4,050
$ 16,350 Oakland-Alameda Cty Coliseum
Authority Oakland Coliseum Arena,
1996 Series A-
6.55%, 11/1/00 $ 16,350
5,100 Schreiber Industrial Park-North Co.
Taxable VRDN
6.70%, 10/7/00 5,100
----------
52,875
----------
COMMUNICATIONS - 0.2%
12,201 New Jersey Economic Development
VRN, Series 1999 - B
6.11%, 10/1/00 12,201
----------
EXECUTIVE, REGISTRATIVE & GENERAL - 0.4%
13,000 BRCH Corp. Taxable VRDN, Series 99
6.70%, 10/7/00 13,000
7,695 Seattle, Washington Ltd. G.O. Bond
Series 1996 - C
6.50%, 10/07/00 7,695
7,530 Texas Municipal Power Agency,
Series 1997
6.69%, 12/12/00 7,530
----------
28,225
----------
HEALTH SERVICES - 0.8%
13,300 Flint, Michigan Hospital Building
Authority Loan Program Notes, Series
1997 - A, Hurley Medical Center
(National City Bank LOC) 6.65%,
10/7/00 13,300
20,150 Healthcare Network Properties LLC
Loan Program VRN, Series 1999 - A
(National City Bank LOC)
6.67%, 10/7/00 20,150
14,155 Integris Health, Inc. Taxable
Baptist Medical Plaza Associate Ltd.
6.68%, 10/7/00 14,155
2,750 Waukesha, Wisconsin, Health
System, Inc.
6.70%, 10/7/00 2,750
----------
50,355
----------
</TABLE>
15
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
-----------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 6.1% (CONT'D)
TRANSPORTATION - 0.1%
$ 5,682 Transmission Agency of Northern CA-One
Transits Project, CP Notes,
(Westdeutsche Landesbank LOC)
6.55%, 11/1/00 $ 5,683
----------
UTILITIES - 0.3%
3,200 Iowa Finance Authortity Waste Disposal
Revenue Bond, Cedar River Paper Co.
Project, Series 1997 - A (AMT) 5.70%,
10/2/00 3,200
17,400 Municpal Electric Authority of Georgia
General Resident Project BAN's, Series 1997
6.67%, 10/5/00 17,400
----------
20,600
----------
Total Municipal Investments
(cost $389,815) 389,815
----------
REPURCHASE AGREEMENTS - 10.2%
(Colld. By U.S. Government Securities)
75,000 Bear Stearns, Inc., dated 9/29/00,
repurchase price $75,028
6.75%, 10/2/00 75,000
100,000 Bear Stearns, Inc., dated 9/29/00,
repurchase price $100,037
6.80%, 10/2/00 100,000
150,000 Donaldson, Lufkin & Jenrette,
dated 9/29/00, repurchase price
$150,055, 6.75%, 10/2/00 150,000
75,000 Greenwich Capital Markets,
dated 9/29/00, repurchase price
$75,028, 6.78%, 10/2/00 75,000
150,000 Greenwich Capital Markets,
dated 9/29/00, repurchase price
$150,056, 6.78%, 10/2/00 150,000
$100,000 Paine Webber, Inc., dated 9/29/00,
repurchase price $100,037
6.78%, 10/2/00 $ 100,000
Total Repurchase Agreements
(cost $650,000) 650,000
----------
Total Investments - 100.0%
(cost $6,390,472) 6,390,472
Liabilities less Other Assets - 0.0% (854)
----------
NET ASSETS - 100.0% $6,389,618
----------
----------
</TABLE>
16
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
NORTHERN FUNDS Semiannual Report
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
U.S. GOVERNMENT MONEY MARKET FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT AGENCIES - 56.4%
FANNIE MAE - 35.0%
FNMA Bonds
$ 10,000 6.625%, 3/1/01 $ 10,000
5,000 7.26%, 5/24/01 5,000
5,000 7.25%, 5/25/01 5,000
FMNA Bond FRN
20,000 6.46%, 11/13/00 19,998
FNMA Discount Notes
9,000 6.68%, 10/02/00 8,998
10,000 6.55%, 11/1/00 9,944
6,403 6.52%,11/1/00 6,367
36,615 6.49%, 11/1/00 36,409
15,000 6.43%, 12/1/00 14,837
3,000 6.44%, 1/2/01 2,950
6,285 6.375%, 1/2/01 6,082
13,000 6.37%, 2/1/01 12,717
10,000 6.42%, 2/15/01 9,756
10,000 6.41%, 3/1/01 9,732
10,000 6.40%, 6/1/01 9,568
----------
167,358
----------
FEDERAL HOME LOAN BANK - 8.9%
FHLB Bonds
10,000 6.48%, 3/20/01 9,995
FHLB Bonds FRN
10,000 6.43%, 10/15/00 9,994
10,000 6.43%, 10/17/00 9,995
12,754 FHLB Discount Notes
6.28%, 10/2/00 12,752
----------
42,736
----------
FREDDIE MAC - 12.5%
FHLMC Bonds
5,000 6.75%, 3/30/01 5,000
10,000 6.93%, 8/28/01 10,000
10,000 6.80%, 10/11/01 10,000
FHLMC Bond FRN
25,000 6.43%, 10/26/00 24,986
FHLMC Discount Notes
10,000 6.44%, 10/12/00 9,980
----------
59,966
----------
Total U.S. Government Agencies
(cost $270,060) 270,060
----------
REPURCHASE AGREEMENTS - 49.9%
(Colld. By U.S. Government Securities)
$20,000 Bear Stearns, Inc., dated 9/8/00
repurchase price $20,218
6.55%, 11/7/00 $ 20,000
70,000 Bear Stearns, Inc., dated 9/29/00
repurchase price $70,039
6.75%, 10/2/00 70,000
60,000 DLJ Securities Corp., dated 9/29/00
repurchase price $60,034
6.75%, 10/2/00 60,000
14,000 DLJ Securities Corp., dated 9/29/00
repurchase price $14,008
6.75%, 10/2/00 14,000
50,000 Warburg Dillion Reed LLC, dated 9/29/00
repurchase price $50,028
6.70%, 10/2/00 50,000
25,000 Paine Webber, Inc., dated 8/7/00
repurchase price $25,388
6.58%, 11/7/00 25,000
----------
Total Repurchase Agreements
(cost $239,000) 239,000
----------
Total Investments - 106.3%
(cost $509,060) 509,060
Liabilities less Other Assets - (6.3)% (30,110)
----------
NET ASSETS - 100.00% $ 478,950
----------
----------
</TABLE>
17
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
U.S. GOVERNMENT SELECT MONEY MARKET FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT
AGENCIES - 100.3%
FEDERAL FARM CREDIT BANK - 4.9%
FFCB Discount Notes,
$ 5,500 6.45%, 10/4/00 $ 5,497
30,000 6.39%, 10/5/00 29,979
----------
35,476
----------
FEDERAL HOME LOAN BANK - 89.6 %
FHLB Bonds
10,000 6.50%, 3/06/01 9,999
30,000 6.48%, 3/20/01 29,989
15,000 7.21%, 5/25/01 15,000
10,000 7.10%, 6/07/01 10,000
FHLB Discount Notes
85,167 6.28%, 10/2/00 85,152
25,000 6.47%, 10/6/00 24,978
5,000 6.43%, 10/10/00 4,992
15,000 6.42%, 10/10/00 14,976
1,900 6.45%, 10/11/00 1,897
20,899 6.46%, 10/13/00 20,854
31,000 6.55%, 10/18/00 30,906
18,000 6.54%, 10/20/00 17,939
20,000 6.53%, 10/20/00 19,932
10,000 6.51%, 11/1/00 9,945
25,000 6.49%, 11/8/00 24,832
10,000 6.49%, 11/22/00 9,907
50,000 6.49%, 11/24/00 49,522
15,000 6.49%, 12/13/00 14,805
15,000 6.47%, 12/13/00 14,806
10,000 6.48%, 12/15/00 9,867
25,000 6.60%, 2/2/01 24,449
10,000 6.62%, 2/14/01 9,758
15,000 6.625%, 2/16/01 14,631
25,000 6.62%, 2/28/01 24,333
5,000 6.52%, 3/14/01 4,856
10,000 6.51%, 3/14/01 9,712
6,465 6.53%, 3/21/01 6,271
FHLB FRN
25,000 6.68%, 10/6/00 25,000
60,000 6.42%, 8/15/01 59,958
$ 20,000 6.46%, 8/17/01 $ 19,986
25,000 6.44%, 9/21/01 24,988
----------
644,240
----------
TENNESSEE VALLEY AUTHORITY - 5.8%
41,640 6.40%, 10/3/00 41,625
----------
Total Investments - 100.3%
(cost $721,341) 721,341
Liabilities less Other Assets - (0.3)% (2,147)
----------
NET ASSETS - 100.0% $ 719,194
----------
----------
</TABLE>
18
SEE NOTES TO THE FINANCIAL STATEMENTS.
<PAGE>
NORTHERN FUNDS Semiannual Report
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
ALABAMA - 0.9%
$ 1,800 Ashland Industrial Development Board
IDR VRDB (AMT), Russell Corp.
Project (SunTrust Bank LOC),
5.70%, 10/6/00 $ 1,800
6,175 Fairfield Industrial Development Board
Environmental Improvement Revenue VRDB,
USX Corp. Project (Wachovia Bank LOC),
4.25%, 10/6/00 6,175
4,250 Oxford G.O. VRDB, Trust Receipts,
SGB 34 (AMBAC Insured),
5.62%, 10/6/00 4,250
2,100 Selma Industrial Development Board
Revenue VRDB, Series A (AMT),Meadowcraft,
Inc. Project (Bank of America LOC),
5.75%, 10/6/00 2,100
9,800 Stevenson Industrial Development
Board Revenue VRDB, Series B (AMT),
Mead Corp. Project (Bank One LOC),
5.65%, 10/2/00 9,800
----------
24,125
----------
ALASKA - 0.3%
2,200 Alaska Housing Finance Corp. VRDB,
Merrill P-Floats PT-37,
5.65%, 10/2/00 2,200
3,750 Alaska International Airports
Revenue VRDB, Series I (AMT),
Merlots (AMBAC Insured),
5.55%, 10/6/00 3,750
1,600 Valdez Marine Terminal Revenue VRDB,
Series 1994B, ARCO Transportation
Project (Atlantic Richfield Co. Gtd.),
5.70%, 10/6/00 1,600
----------
7,550
----------
ARIZONA - 0.3%
1,175 Apache County IDA VRDN, Series 1996 (AMT),
Imperial Components, Inc. Project (Harris
Trust & Savings Bank LOC), 5.55%, 10/6/00 1,175
1,245 Maricopa County Hospital IDA VRDB,
Mayo Foundation Series 1998-103,
Morgan Stanley Floater Certificates,
5.67%, 10/6/00 1,245
$ 5,800 Rancho Ladera COP VRDN, Series 1999 A
(Credit Suisse First Boston LOC),
5.58%, 10/6/00 $ 5,800
----------
8,220
----------
ARKANSAS - 0.5%
5,295 Arkansas State Development Finance
Authority Home Mortgage Revenue
Bonds, Series PT-257 (AMT),
(Colld. by U.S. Government Securities),
5.70%, 10/2/00 5,291
3,750 Arkansas State Development Finance
Authority Multi-Family Housing
Revenue VRDB, Series C (AMT),
Chapel Ridge (First Tennessee Bank LOC)
5.72%, 10/6/00 3,750
3,250 Lowell City IDR VRDB, Series 1996
(AMT), Little Rock Newspapers, Inc.
Project (Bank of New York LOC),
5.60%, 10/6/00 3,250
1,950 West Memphis City IDR VRDN (AMT),
Proform Co. LLC Project (U.S. Bank LOC),
5.80%, 10/6/00 1,950
----------
14,241
----------
CALIFORNIA - 0.0%
730 Chula Vista IDR VRDB, Series 1996-B
(AMT), San Diego Gas & Electric Co.
(San Diego Gas & Electric Co. Gtd.),
5.10%, 10/2/00 730
----------
COLORADO - 3.4%
3,200 Castle Pines North Metropolitan
District Limited Tax G.O. VRDB,
Series 1999, (BNP Paribas LOC),
5.60%, 10/6/00 3,200
3,500 City and County of Denver
Airport System Subordinate Revenue
Bonds, Series 1997 A (AMT),
(Bayerische Landesbank LOC),
4.30%, 12/8/00 3,500
5,000 City and County of Denver Special
Facility Airport VRDN, Series 2000A
(AMT), WorldPort at Denver International
Project (Morgan Guaranty Trust Co. LOC),
5.65%, 10/6/00 5,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
19
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
COLORADO - 3.4% (CONT'D.)
$10,860 City and County of Denver School
District No. 1 G.O. Unlimited Bonds,
Series PT-1135, P-Floats, 3.90%, 12/1/00 $10,860
3,500 Colorado HFA Economic Development
Revenue VRDB (AMT), Metal Sales
Manufacturing Corp. Project
(Firstar Bank LOC), 5.75%, 10/6/00 3,500
5,250 Colorado HFA Multi-Family Class VRDB,
Series A-1 (MBIA Insured),
5.50%, 10/2/00 5,250
33,320 Colorado HFA Multi-Family Insured
Mortgage Revenue VRDB, Series A,
5.62%, 10/6/00 33,320
155 Colorado Student Obligation Bond
Authority Revenue VRDB, Series A (AMT)
(SLMA Gtd.), 5.55%, 10/6/00 155
4,995 Denver Airport System VRDB, Merrill
Lynch P-Floats PA-763, Series 2000A
(AMT), (AMBAC Insured), 5.67%, 10/6/00 4,995
5,000 Douglas County School District
No. 1 TAN, Douglas & Elbert Counties,
5.00%, 6/29/01 5,024
3,035 El Paso County Single Family Mortgage
Revenue Bonds, Series C (AMT), (AIG
Funding Corp GIC), 5.00%, 6/15/01 3,035
10,000 Jefferson County School District
No. R-001 TAN, 5.00%, 6/27/01 10,049
4,400 Pitkin County IDA VRDN, Series 1994-B
(AMT), Aspen Skiing Co. Project (Bank
One LOC),
5.75%, 10/2/00 4,400
----------
92,288
----------
DELAWARE - 1.2%
Delaware Economic Development
Authority IDR VRDN (AMT), Delaware
Clean Power Project,
$10,000 Series 1997-B, 5.75%, 10/6/00 $10,000
20,000 Series 1997-D, 5.85%, 10/6/00 20,000
3,000 Delaware State Economic Development
Authority IDR VRDB, Series 1998 (AMT),
C&C Family Limited Partnership (PNC
Bank LOC), 5.60%, 10/6/00 3,000
----------
33,000
----------
DISTRICT OF COLUMBIA - 2.3%
4,165 District of Columbia G.O. Refunding VRDB,
P-Float, Series PA-568 (FSA Insured),
5.62%, 10/6/00 4,165
10,000 District of Columbia G.O. Refunding
VRDB, Series 1999B-12, ROC II (FSA Insured),
5.62%, 10/6/00 10,000
5,320 District of Columbia Water & Sewer
Authority Revenue VRDB, Public Utility
Authority (FSA Insured), 5.62%, 10/6/00 5,320
3,300 District of Columbia Water & Sewer
Authority Revenue VRDB, Series
985201, Citibank Eagle Trust (FSA
Insured), 5.33%, 10/6/00 3,300
7,590 District of Columbia Water & Sewer
Authority Revenue VRDB, Citicorp Eagle
Trust 8121A (FSA Insured), 5.33%, 10/6/00 7,590
31,000 Washington D.C. Metro Airport Authority
Passenger Facility Flexible Term Notes,
(AMT), (Bank of America LOC),
4.60%, 11/16/00 31,000
----------
61,375
----------
FLORIDA - 3.4%
12,102 Broward County Sales TRB CP, Series A,
5.50%, 10/10/00 12,102
2,200 Broward County Sales Subordinate Port
Facility Bonds, Series 1998 (AMT),
Port Everglades Project (AMBAC Insured),
5.50%, 10/6/00 2,200
4,000 Florida Board of Education Capital Outlay
Revenue VRDB, Series 1998-9, ABN-AMRO
MuniTops, (FSA Insured), 5.67%, 10/6/00 4,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
20
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 6,500 Florida Department of Juvenile Justice
COP First Union Merlot VRDB,
Series 2000-000, (MBIA Insured),
5.50%, 10/6/00 $ 6,500
3,750 Florida Housing Finance Corp. Revenue
Bonds, Homeowner Mortgage Services
Merrill Lynch P-Floats PT-451 (AMT),
(FSA Insured),
4.45%, 2/8/01 3,750
7,145 Hillsborough County School District
VRDN, TOB PCR-4 (MBIA Insured),
5.50%, 10/6/00 7,145
12,000 Indian River County Hospital District
Revenue Bonds, Series 1990,
(KBC Bank LOC), 4.20%, 10/10/00 12,000
6,000 Indian River County Hospital District
Hospital Revenue Bonds, Series 1988,
(KBC Bank LOC),
4.25%, 12/8/00 6,000
1,900 Miami-Dade County IDA IDR VDRN,
Series 1998 (AMT), Fine Art Lamps
Project (SunTrust Bank LOC),
5.70%, 10/6/00 1,900
3,000 Miami-Dade County IDA VRDB (AMT),
Airis Miami LLC Project (AMBAC
Insured), 5.50%, 10/6/00 3,000
2,000 Ocean Highway & Port Authority
Revenue VRDB (AMT) (ABN-AMRO LOC),
5.65%, 10/6/00 2,000
20,000 Orange County Health Facility Revenue
VRDB, Series 17, Adventist Health -
Morgan Stanley Municipal Trust Receipts
(AMBAC Insured),
5.74%, 10/6/00 20,000
4,340 Orange County HFA VRDN, Series 1987-A,
Citicorp Eagle Trust (Colld. by
U.S. Government Securities),
4.62%, 10/6/00 4,340
7,975 Sunrise Utility System Revenue and
Refunding VRDB, Series 1998A
TOB PCR19, (AMBAC Insured),
5.50%, 10/6/00 7,975
----------
92,912
----------
GEORGIA - 5.1%
$ 3,900 Albany-Dougherty County Hospital
Authority, Series 1996, Phoebe Putney
Memorial Hospital (AMBAC Insured),
5.60%, 10/6/00 $ 3,900
5,800 Atlanta Airport Authority Revenue
Bonds, Series B (AMT), (FGIC Insured),
5.55%, 10/6/00 5,800
11,800 Atlanta Housing Authority Multi-Family
VDRN, Series 1999 (AMT), Village of
E. Lake Phase II (Bank of America LOC),
5.70%, 10/6/00 11,800
15,600 Atlanta MUNITOPS Certificates Trust
Revenue Bonds, Series 2000-4, (FGIC
Insured), 5.69%, 10/6/00 15,600
3,000 Atlanta Urban Resident Finance Authority
Series 2000 (AMT), Carver Redevelopment
Project (Sun Trust Bank LOC), 5.70%, 10/6/00 3,000
5,300 Clayton County Development Authority
IDR VRDB, Series 1996 (AMT), Blue Circle
Aggregates, Inc. Project (Denmark Danske
Bank LOC), 5.70%, 10/6/00 5,300
7,055 Clayton County Hospital Authority RAN,
Series 1998 B (AMT), Southern Regional
Medical Center (SunTrust Bank LOC),
5.60%, 10/6/00 7,055
4,100 Clayton County Housing Authority
Multifamily Revenue VRDN, Williamsburg
South Apartments (PNC Bank LOC),
5.60%, 10/6/00 4,100
5,200 DeKalb County Housing Authority Revenue
Refunding VRDB, Series 1995 (AMT), Cedar
Creek Apartment Project (General Electric
Capital Corp. LOC),
5.60%, 10/6/00 5,200
2,700 Fulton County Development Authority
Revenue Bonds, Trinity School Project
(SunTrust Bank LOC),
5.60%, 10/6/00 2,700
6,000 Fulton County School District Citicorp
Eagle Trust Series 981001,
5.62%, 10/6/00 6,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
21
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
GEORGIA - 5.1% (CONT'D.)
$11,340 Georgia HFA SFM Bonds, Series 1999
B-4 PT 299 (AMT), 4.00%, 10/12/00 $11,340
Georgia HFA Mortgage Bonds TOB,
4,870 Series 1990-C (AMT), 4.50%, 12/1/00 4,870
640 Series 1990-D (AMT), 4.50%, 12/1/00 640
12,000 Georgia State G.O. VRDB, Eagle Trust
Series 97C1001,
5.62%, 10/6/00 12,000
17,280 Georgia State G.O. VRDB, Eagle Trust
Series 1999 D,
5.62%, 10/6/00 17,280
9,395 Georgia State G.O. Unlimited VRDB,
Series B,
5.62%, 10/6/00 9,395
1,600 Gwinnett County IDR VRDN, Series 1998
(AMT), Network Publications, Inc. (Bank of
America LOC),
5.70%, 10/6/00 1,600
4,150 Henry County Development Authority
Revenue Bonds, Series 1997 (AMT), Atlas
Roofing Corp. Project (Sun Trust
Bank LOC), 5.70%, 10/6/00 4,150
5,000 Savannah Economic Development
Authority Revenue VRDN, Series 1997
(AMT), Georgia Kaolin Terminals (Bank of
America LOC), 5.70%, 10/6/00 5,000
----------
136,730
----------
HAWAII - 0.4%
2,495 Hawaii State Airport System Revenue
Bonds, Merrill Lynch P-Floats PA-765,
Series 2000 B (AMT), (FGIC Insured),
5.67%, 10/6/00 2,495
1,525 Hawaii State G.O. Bonds, Series 1991,
(Colld. by U.S. Government Securities),
6.00%, 2/1/01 1,549
6,000 Hawaii State G.O. Bonds, Citicorp Eagle
Trust Series 20001101, (FGIC Insured),
5.62%, 10/6/00 6,000
----------
10,044
----------
IDAHO - 0.7%
$18,350 Education Funding Association Idaho
Student Loan Revenue Bonds, Series
1997 A (AMT), (First Security Bank LOC),
5.70%, 10/6/00 $18,350
----------
ILLINOIS - 11.7%
3,195 Arlington Heights IDR VRDB, Series 1997 (AMT),
3E Graphics & Printing Project (Harris Trust
and Savings Bank LOC), 5.55%, 10/6/00 3,195
9,580 Aurora Rental Housing Revenue VRDB,
Series PA-328, Fox Valley Project (Merrill
Lynch & Co., Inc. Gtd.), 5.67%, 10/6/00 9,580
7,000 Bolingbrook Multi-Family Housing
Redevelopment Revenue Refunding VRDN,
Series 1997A (AMT), Amberton Apartments
(LaSalle National Bank LOC), 5.65%, 10/6/00 7,000
7,405 Chicago Board of Education G.O. Unlimited
VRDB, Series A (PA 616), School Reform Board
(FGIC Insured), 5.77%, 10/6/00 7,405
5,000 Chicago Board of Education School Reform
VRDB, Series 2000 A, 5.62%, 10/6/00 5,000
8,000 Chicago City G.O. Equipment Notes
(Harris Trust and Savings Bank LOC),
3.90%, 10/6/00 8,000
3,885 Chicago City Sales TRB VRDN, Series 1998
(PCR-8 PTOB) (FGIC Insured), 5.50%, 10/6/00 3,885
10,000 Chicago G.O. Project & Refunding Bonds,
Series 1998M, Bank of America Partnership
(FGIC Insured), 4.45%, 3/22/01 10,000
4,500 Chicago G.O. Refunding VRDB, Series 1998,
Citicorp Eagle Trust 981302 (FSA Insured),
5.62%, 10/6/00 4,500
2,655 Chicago IDR VRDN, Series 1996B (AMT),
Guernsey Bel, Inc. Project (LaSalle National
Bank LOC), 6.00%, 10/6/00 2,655
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
22
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 5,500 Chicago Midway Airport Revenue VRDB,
Series 1995 (AMT), American Trans Air, Inc.
Project (Bank One LOC), 5.55%, 10/6/00 $ 5,500
5,250 Chicago Multi-Family Housing Revenue
VRDB, Series 1999A (AMT), Renaissance
Center LP Project (Harris Trust and Savings
Bank LOC), 5.55%, 10/6/00 5,250
27,000 Chicago O'Hare International Airport,
Series A (AMT), American Airlines Inc.
Project (Bank of America LOC), 5.70%, 10/6/00 27,000
2,300 Chicago O'Hare International Airport,
Series 1988-A (AMT), Second Lien Revenue
Bonds (Bayerische Landesbank LOC),
5.65%, 10/6/00 2,300
7,300 Chicago School Reform Board G.O. VRDB,
Series 1996, Bank of America Variable Rate
Certificates (MBIA Insured), 5.67%, 10/6/00 7,300
3,350 Crestwood IDR VRDB (AMT), GMG Warehouse LLC
Project (LaSalle National Bank LOC),
5.67%, 10/6/00 3,350
11,300 DuPage Water Commission Revenue VRDB,
5.62%, 10/6/00 11,300
1,465 Des Plaines City VRDB, Series 1996 (AMT),
Finzer Roller, Inc. Project (Harris Trust and
Savings Bank LOC), 5.50%, 10/6/00 1,465
3,600 Elgin City IDR VRDB, Series 1999 (AMT),
Questek Manufacturing Corp. (American National
Bank & Trust LOC), 5.75%, 10/6/00 3,600
3,350 Frankfort IDR VRDB, Series 1996 (AMT), Bimba
Manufacturing Co. Project (Harris Trust and
Savings Bank LOC), 5.55%, 10/6/00 3,350
3,875 Fulton Industrial Development VRDB,
Series 1998 (AMT), Drives Inc. Project
(Harris Trust and Savings Bank LOC),
5.55%, 10/6/00 3,875
Illinois Development Finance Authority
Revenue Bonds, AMR Pooled Financing
Program (Bank of America LOC),
$ 2,900 Series A, 5.60%, 10/6/00 $ 2,900
2,500 Series C-1, 5.60%, 10/6/00 2,500
2,600 Illinois Development Finance Authority,
Series 2000-2001A, Jewish Charities
(Harris Trust and Savings Bank LOC),
5.55%, 10/6/00 2,600
1,800 Illinois Development Finance Authority
IDR VRDB, Series 1990 (AMT), Solar Press,
Inc. Project (LaSalle National Bank LOC),
5.65%, 10/6/00 1,800
2,265 Illinois Development Finance Authority
IDR VRDB, Series 1997A (AMT), Randall
Metals Corp. Project (LaSalle National
Bank LOC), 5.85%, 10/6/00 2,265
5,080 Illinois Development Finance Authority
Industrial Revenue VRDB, Series A (AMT),
General Converting Project (LaSalle
National Bank LOC), 5.67%, 10/6/00 5,080
4,200 Illinois Development Finance Authority
Industrial Revenue VRDB, Series 1996
(AMT), Touhy Limited Partnership
Project (LaSalle National Bank LOC),
5.67%, 10/6/00 4,200
3,900 Illinois Development Finance Authority
Industrial Revenue VRDB (AMT), Astron
Midwestern, Inc. Project (American National
Bank & Trust LOC), 5.60%, 10/6/00 3,900
900 Illinois Development Finance Authority
Revenue VRDB, Series 1989 (AMT), DE Akin
Seed Co. (Bank One LOC), 5.70%, 10/6/00 900
3,950 Illinois Development Finance Authority
Revenue VRDB (AMT), Olive Can Co.
Project (LaSalle National Bank LOC),
5.67%, 10/6/00 3,950
5,950 Illinois Development Finance Authority
Revenue VRDN, Enterprise Office Campus
(Colld. by U.S. Government Securities),
4.45%, 12/1/00 5,950
5,500 Illinois Development Finance Authority
Revenue VRDN, Series 1998 (AMT), Flying
Food Fare, Inc. (Bank of America LOC),
5.75%, 10/6/00 5,500
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
23
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
ILLINOIS - 11.7% (CONT'D.)
$ 4,545 Illinois Development Finance Authority
Revenue VRDN, Series 1999 (AMT), Elite
Manufacturing Technology, Inc. Project
(Harris Trust and Savings Bank LOC),
5.55%, 10/6/00 $ 4,545
5,475 Illinois Development Finance Authority
Revenue VRDN, Series 1999A (AMT),
Nuevo Hombres LLC Project (American
National Bank and Trust LOC),
5.75%, 10/6/00 5,475
2,270 Illinois Development Finance Authority
IDR VRDN (AMT), Bimba Manufacturing Co.
Project (Harris Trust and Savings Bank LOC),
5.55%, 10/6/00 2,270
4,100 Illinois Development Finance Authority
VRDB, Series A, Local Government Finance
Program (AMBAC Insured), 5.60%, 10/6/00 4,100
4,100 Illinois Development Finance Authority
VRDN, Series 1997 (AMT), Ciccone Food
Products, Inc. (Harris Trust and Savings
Bank LOC), 5.55%, 10/6/00 4,100
10,000 Illinois Health Facilities Authority
Revenue Bonds, Evanston Hospital Corp.
(Evanston Northwestern Corp. Gtd.),
4.75%, 5/15/01 10,000
10,000 Illinois Health Facilities Authority Revenue
Bonds, Evanston Hospital Corp.,
Series 1985B, 4.45%, 8/15/01 10,000
3,820 Illinois Health Facilities Authority,
Mortgage Sinai Health System Series 166,
(AMBAC Insured), 5.62%, 10/6/00 3,820
13,040 Illinois Housing Development Authority
Bonds, Homeowner Mortgage, Series B-2
(AMT), 4.20%, 1/24/01 13,040
5,045 Illinois State Sales Tax Revenue VRDB,
5.62%, 10/6/00 5,045
$ 6,000 Metro Pier and Exposition Authority TRB
First Union Merlot Series 2000-VVV,
(FGIC Insured), 4.40%, 9/1/01 $ 6,000
7,310 Regional Transportation Authority Revenue
Bonds, Series 20001303, (MBIA Insured),
5.62%, 10/6/00 7,310
2,400 Rockford IDR VRDB, Series 1998 (AMT),
Ring Can Corp. Project (SunTrust Bank,
LOC), 5.70%, 10/6/00 2,400
2,125 Romeoville IDR VRDB, Series 1997 (AMT),
Metropolitan Industries, Inc. Project (Harris
Trust and Savings Bank LOC), 5.55%, 10/6/00 2,125
6,500 Savanna IDR VRDB, Series 1994 (AMT),
Metform Corp. Project (Bank One LOC),
5.65%, 10/6/00 6,500
5,450 St. Clair County IDR VRDN (AMT), Stellar
Manufacturing Project (Bank of America
LOC), 5.75%, 10/6/00 5,450
10,465 State of Illinois G.O. Unlimited (MBIA
Insured) 4.50%, 6/14/01 10,465
2,550 State of Illinois G.O. Bonds, Series 1998,
5.00%, 4/01/01 2,558
3,000 University of Illinois Auxiliary Facility
System Revenue Bonds, Eagle Trust
Series 20001301, (MBIA Insured),
5.62%, 10/6/00 3,000
3,500 University of Illinois Revenue VRDB,
Auxiliary Facility System, Merlot
Series 2000 S (MBIA Insured),
5.50%, 10/6/00 3,500
7,500 Village of Ladd, IDR VRDB, Series 1996
(AMT), O'Neal Metals, Inc. (Bank of
America LOC), 5.75%, 10/6/00 7,500
2,470 Village of Niles IDR VRDB, Series 1996
(AMT), Lewis Spring & Manufacturing Co.
Project (Harris Trust and Savings Bank LOC),
5.55%, 10/6/00 2,470
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
24
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 2,200 West Chicago City IDR VRDB, Series 1999
(AMT), Royal Gold Ribbon Foods (Bank
One LOC),
5.75%, 10/6/00 $ 2,200
9,000 Will County Solid Waste Bonds, Series 1997
(AMT), BASF Corp., (BASF Corp. Gtd.),
5.70%, 10/2/00 9,000
4,600 Will-Kankakee Regulatory Development
Authority VRDN (AMT), T.H. Davidson &
Co., Inc. Project (LaSalle National Bank
LOC),
5.67%, 10/6/00 4,600
----------
314,528
----------
INDIANA - 2.8%
2,790 Anderson City Economic Development
Revenue VRDB, Series 1996 (AMT),
GatewayVillage Project (FHLB LOC),
5.62%, 10/6/00 2,790
5,000 Avilla Economic Development Revenue
VRDB, Series 1996 (AMT), Pent
Assemblies, Inc. Project (Bank One LOC),
5.75%, 10/7/00 5,000
3,700 Greencastle Industry Development
Revenue VRDB (AMT), Crown Equipment
Corp. Project (KeyBank LOC),
5.60%, 10/6/00 3,700
2,840 Hammond City Economic Development
Revenue VRDB, Series 1996-A (AMT),
Annex at Douglas Point Project (FHLB
LOC),
5.62%, 10/6/00 2,840
14,985 Indiana Bond Bank Advance Funding
Program Notes, Series A-2,
4.75%, 1/18/01 15,010
Indiana Development Finance Authority
IDR VRDB (AMT), Red Gold, Inc. Project
(Harris Trust and Savings Bank LOC)
4,600 Series 1994-A, 5.55%, 10/6/00 4,600
2,900 Series 1994-B, 5.55%, 10/6/00 2,900
23,500 Indiana Health Facility Financing
Authority Revenue Bonds, Series B,
Ascension Health,
5.75%, 10/6/00 23,500
$ 8,400 Indiana Transportation Authority Highway
Revenue Bonds, Citicorp Eagle Trust
Series 981402, 5.62%, 10/6/00 $ 8,400
Jasper County PCR Bonds,
Northern Indiana Public Service Project
(Northern Indiana Public Service Gtd.),
4,600 Series 1988-A, 4.40%, 11/10/00 4,600
2,000 Series 1988-D, 4.50%, 11/08/00 2,000
1,100 Madison Economic Development
Authority Revenue VRDB, Arvin Sango,
Inc. Project (Bank One LOC),
5.65%, 10/6/00 1,100
----------
76,440
----------
IOWA - 1.5%
1,180 Iowa Finance Authority SFM
Revenue Bonds Merrill
P-Float PT-99 Series1999-A,
5.65%, 10/2/00 1,180
Iowa Finance Authority Waste Disposal
Revenue VRDB, Cedar River Paper Co.
Project (Union Bank of Switzerland LOC),
1,100 Series 1993-A (AMT), 5.70%, 10/2/00 1,100
7,900 Series 1994-A (AMT), 5.70%, 10/2/00 7,900
12,250 Series 1995-A (AMT), 5.70%, 10/2/00 12,250
5,000 Series 1996-A (AMT), 5.70%, 10/2/00 5,000
6,800 Series 1997-A (AMT), 5.70%, 10/2/00 6,800
6,200 Series 1998-A (AMT), 5.70%, 10/2/00 6,200
----------
40,430
----------
KANSAS - 1.3%
5,625 Kansas City GNMA Revenue VRDB,
Series 1988B (AMT) (Colld. by
U.S. Government Securities),
5.65%, 10/6/00 5,625
4,000 Lawrence Temporary Notes, Series I,
4.75%, 6/1/01 4,007
1,000 Olathe City IDR VRDB, Series 1997A
(AMT), Diamant Boart, Inc. Project
(Deutsche Bank LOC), 5.55%, 10/6/00 1,000
3,500 Olathe Temporary Notes, Series 2000 A,
5.00%, 10/2/00 3,500
6,000 Olathe Temporary Notes, Series 2000 B,
5.00%, 6/1/01 6,020
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
25
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
KANSAS - 1.3% (CONT'D.)
$ 4,780 Overland Park G.O. Municipal Temporary
Notes Series 2000, 5.00%, 4/27/01 $ 4,798
3,475 Shawnee Mutifamily Housing Shawnee
Station Apartment Project (AIG Funding
Corp. GIC), 5.00%, 5/1/01 3,475
5,975 State Department of Transportation
Highway Revenue VRDB, Eagle
Series 20001601, 5.62%, 10/6/00 5,975
----------
34,400
----------
KENTUCKY - 1.6%
5,701 Carroll County Solid Waste Disposal
Revenue VRDB (AMT), North American
Stainless Project (Banco Bilbao Vizcaya
LOC), 5.90%, 10/6/00 5,701
3,045 City of Danville Municipal Pooled Lease
Program (PNC Bank LOC), 4.15%, 11/9/00 3,045
2,560 Clark County Industrial Building Revenue
VRDB, Series 1996 (AMT), Bluegrass Art
Cast Project (Bank One LOC),
5.75%, 10/6/00 2,560
6,425 Clark County PCR, Series J-2, East
Kentucky Power (National Rural Utility
Cooperative Finance Co. Gtd.),
4.15%, 10/15/00 6,425
4,070 Kentucky State Turnpike Authority
Economic Development Authority VRDN,
Morgan Stanley Floating Rate Trust
Certificate 2000, Series 293 (AMBAC
Insured),
5.62%, 10/6/00 4,070
21,500 Louisville & Jefferson County Regional
Airport Authority Revenue BAN,
Series 1997A (AMT), Airport Systems
(National City Bank of Kentucky LOC),
5.55%, 10/6/00 21,500
----------
43,301
----------
LOUISIANA - 1.0%
Ascension Parish Revenue VRDB,
BASF Corp. Project (BASF Corp. Gtd.)
$ 2,900 Series 1997 (AMT), 5.70%, 10/2/00 $ 2,900
9,300 Series 1998 (AMT), 5.70%, 10/2/00 9,300
2,600 Jefferson Parish Industrial Development
Board Revenue VRDB, Series 1994
(AMT), Sara Lee Corp. Project (Sara Lee
Corp. Gtd.), 5.75%, 10/2/00 2,600
1,900 Jefferson Sales District TRB, Special Sales
Tax Revenue (FSA Insured), 5.00%, 12/1/00 1,903
6,900 Louisiana State G.O. VRDB, Citicorp Eagle
Trust Series 1994A (AMBAC Insured),
5.62%, 10/6/00 6,900
4,000 South Louisiana Port Commission Port
Facilities Revenue VRDB, Series 1997
(AMT), Holnam, Inc. Project (Wachovia
Bank LOC), 5.65%, 10/6/00 4,000
----------
27,603
----------
MAINE - 0.7%
2,000 Fort Fairfield Revenue VRDB (AMT), Atlantic
Custom Processors (PNC Bank LOC), 5.60%,
10/6/00 2,000
5,000 Maine Public Utility Finance Bank
Revenue VRDN (AMT), Series 1996, Maine
Public Service Co. Project (Bank of New
York LOC), 5.60%, 10/6/00 5,000
9,995 Maine State Housing Authority Mortgage
Purchase VRDB, Series 1998F-2 (AMT),
5.01%, 10/6/00 9,995
3,000 Maine State Turnpike Authority Revenue,
Eagle Trust Series 20001901, (FGIC
Insured), 5.46%, 10/6/00 3,000
----------
19,995
----------
MARYLAND - 2.9%
1,000 Baltimore City Board of Commissioners
VRDN, Notre Dame Prep School Project
(SunTrust Bank LOC), 5.60%, 10/6/00 1,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
26
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 4,100 Cecil County Economic Development
Revenue Bonds (AMT), Steel Techs, Inc.
(PNC Bank LOC),
5.60%, 10/6/00 $ 4,100
4,895 Howard County Multi-Family Housing
Revenue VRDB, Series PT-313 P-Floats
(Colld. by U.S. Government Securities),
5.62%, 10/6/00 4,895
4,000 Howard County Multi-Family Housing,
Sherwood Crossing Limited (Colld. by U.S.
Government Securities),
4.85%, 6/1/01 4,000
3,995 Maryland State Community Development
Administration, Housing & Community
Development Notes, Series PT-284,
4.47%, 4/5/01 3,995
10,000 Maryland State Community Development
Administration, Housing & Community
Development Notes, Series 1999 (AMT),
4.05%, 12/14/00 10,000
22,440 Maryland State Community Development
Administration, Housing & Community
Development Revenue Bonds, Series B
(AMT), Residential Housing,
5.55%, 10/6/00 22,440
2,565 Maryland State Economic Development
Corp. (AMT), Unisite Design, Inc.
(Mellon Bank LOC), 5.75%, 10/6/00 2,565
11,185 Northeast Maryland Waste Disposal
Authority Reserve Eagle Trust VRDN,
Series 96C2001, (MBIA Insured),
5.62%, 10/6/00 11,185
13,850 State of Maryland G.O. Unlimited,
4.50%, 6/14/01 13,850
----------
78,030
----------
MASSACHUSETTS - 0.2%
5,500 Massachusetts State Development Finance
Agency VRDN (AMT), Waste Management, Inc.
Project (SunTrust Bank LOC), 5.70%, 10/6/00 5,500
----------
MICHIGAN - 4.8%
$ 7,500 City of Flint Economic Development Corp.
Revenue Bonds, Series 2000, UPF Inc.
Project (Comerica Bank LOC), 5.75%, 10/6/00 $ 7,500
7,500 Detroit Sewage Disposal System VRDN,
First Union, Merlot Series 2000 A (FGIC
Insured),
5.50%, 10/6/00 7,500
6,000 Jackson County Economic Development
Corp. VRDN, (AMT), Kellog Crankshaft Co.
Project 2000, (Comerica Bank LOC),
5.75%, 10/6/00 6,000
6,000 Jackson County Economic Development
Corp. VRDN, Production Saw & Machine Co.,
Series 1999 (AMT) (Comerica Bank LOC),
5.75%, 10/6/00 6,000
20,000 Michigan State COP, New Center
Development, Inc. (Canadian Imperial
Bank of Commerce LOC),
4.75%, 3/1/01 20,016
5,000 Michigan State Housing Development
Authority Revenue VRDB, Series 1999
(AMT), Baldwin Villas (Comerica Bank LOC),
5.75%, 10/6/00 5,000
5,000 Michigan State Strategic Fund VRDN
(AMT), Serta Restokraft Mattress Co.
Project (Comerica Bank LOC),
5.75%, 10/6/00 5,000
2,200 Michigan State Strategic Fund VRDN,
Series 1999 (AMT), Great Lakes Metal
Stamping (Bank One, Michigan LOC),
5.75%, 10/6/00 2,200
2,000 Michigan State Strategic Fund VRDN,
Series 1999 (AMT), Midway Die &
Engineering (Bank One LOC), 5.75%, 10/6/00 2,000
3,000 Michigan State Strategic Fund VDRN
(AMT), Dirksen Screw Co. Project (Bank
One, Michigan LOC), 5.75%, 10/6/00 3,000
1,990 Michigan State Strategic Fund Limited
Obligation VRDB (AMT), Kruger
Commodities, Inc. Project (Harris Trust
and Savings Bank LOC), 5.55%, 10/6/00 1,990
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
27
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
MICHIGAN - 4.8% (CONT'D.)
$ 4,000 Michigan State Strategic Fund Limited
Obligation Revenue Bonds (AMT), Alphi
Manufacturing Inc. Project (Bank One,
Michigan LOC), 5.75%, 10/6/00 $ 4,000
5,000 Michigan State Strategic Fund Limited
Obligation Revenue Bonds (AMT), Grand
Haven Plastics Project (Bank One,
Michigan LOC), 5.75%, 10/6/00 5,000
3,000 Michigan State Strategic Fund Limited
Obligation, (AMT), Corlett-Turner Co.
Project (Comerica Bank LOC),
5.75%, 10/6/00 3,000
3,000 Michigan State Strategic Fund Limited
Obligation Revenue, (AMT), Gilreath
Manufacturing Detroit Project (Bank One,
Michigan LOC), 5.75%, 10/6/00 3,000
7,500 Michigan State Strategic Fund Variable
Limited Obligation Revenue (AMT),
NYX Technologies LLC Project,
(Comerica Bank LOC), 5.75%, 10/6/00 7,500
4,700 Michigan State Strategic Fund Limited
Obligation, Series 1998 (AMT), GT USA
LLC Project (Comerica Bank LOC),
5.75%, 10/6/00 4,700
28,700 Midland County Economic Development
Corp. VRDN, Series 1993A (AMT), Dow
Chemical Corp. Project (Dow Chemical
Gtd.), 5.65%, 10/2/00 28,700
5,970 Oakland City Economic Development
Corp. VRDN, Series 1998 (AMT), Richard
Tool & Die Corp. (Comerica Bank LOC),
5.75%, 10/6/00 5,970
----------
128,076
----------
MINNESOTA - 0.3%
$ 2,000 Minneapolis Community Development
Agency Tax Increment Revenue Bonds,
(MBIA Insured), 7.00%, 3/1/01 $ 2,019
3,200 Minnesota State Housing Finance Agency, SFM
Revenue Bond Series E (AMT), 4.35%, 5/1/01 3,200
3,060 Stearns County Housing & Redevelopment
Authority VRDN (AMT), Cold Spring
Granite Co. Project (U.S. Bank LOC),
5.80%, 10/6/00 3,060
----------
8,279
----------
MISSISSIPPI - 1.1%
16,070 Mississippi Gulf Coast Revenue Refunding
VRDB, Waste Water Treatment, Merlot
Series 99C698 (MBIA Insured), 4.65%, 7/1/01 16,070
8,965 Mississippi Home Corp. VRDN,
Series A-CL-6 PT-173 (AMT),
5.67%, 10/6/00 8,965
3,250 Mississippi Home Corp. Single Family
Revenue VRDB, Series G-CL-5 PT-146 (AMT),
5.67%, 10/6/00 3,250
----------
28,285
----------
MISSOURI - 1.2%
1,400 Missouri Health and Education Facilities
Authority, Series 99 A, Missouri Pooled
Hospital Loan Program (Caisse des
Depots et Consignations LOC),
5.60%, 10/6/00 1,400
1,800 Missouri Higher Education Loan Authority
Student Loan Revenue Refunding VRDB,
Series 1991-B (AMT) (MBIA Insured),
5.75%, 10/6/00 1,800
3,700 Missouri Housing Development Community
Mortgage Revenue Bonds, Merrill P-Float
PA-116, Series 1994A (AMT), 5.67%, 10/6/00 3,700
12,366 Missouri State Environmental
Improvement Authority Revenue Bonds,
Series 1992, Kansas Power & Light Co.
Project (Kansas Power & Light Co. Gtd.),
4.35%, 12/15/00 12,366
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
28
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 1,600 Missouri State Environmental
Improvement Authority Revenue Bonds,
Series 1992, Kansas Power & Light Co.
Project (Kansas Power & Light Co. Gtd.),
5.60%, 10/6/00 $ 1,600
8,000 St. Louis City IDA VRDB, Series 1995
(AMT), Whispering Lakes Apartment
Project (Mercantile Bank of St. Louis
LOC), 5.60%, 10/6/00 8,000
3,000 St. Louis General Fund TRAN,
Series 1999-2000, 5.25%, 6/28/01 3,014
----------
31,880
----------
MONTANA - 0.0%
780 Montana Board of Housing SFM
VRDN P-Floats Series PT-87,
5.67%, 10/6/00 780
----------
NEBRASKA - 0.2%
3,895 Nebraska Investment Finance Authority
Revenue VRDB, Series E (AMT) (Colld. by
U.S. Government Securities),
5.55%, 10/6/00 3,895
1,500 Nebraska Investment Mortgage Revenue
VRDB, Series 1992D (AMT), LB Trust
Receipts,
5.65%, 10/6/00 1,500
----------
5,395
----------
NEVADA - 0.2%
6,200 Nevada State VRDB, Series 1997-SGB 31
(FGIC Insured), 5.62%, 10/6/00 6,200
----------
NEW HAMPSHIRE - 0.1%
1,625 New Hampshire Municipal Bond Bank
Revenue Bonds, Series C (FSA Insured),
5.375%, 1/15/01 1,631
----------
NEW MEXICO - 0.3%
$ 3,900 Farmington PCR VRDB, Series C (AMT),
Arizona Public Service Co. (Barclays Bank
LOC),
5.60%, 10/2/00 $ 3,900
5,040 New Mexico Mortgage Finance Authority
SFM VRDN, Series B-2 PT-196 (AMT)
(Colld. by U.S. Government Securities),
5.67%, 10/6/00 5,040
----------
8,940
----------
NEW YORK - 1.4%
5,000 Metropolitan Transportation Authority
Revenue VRDB, Merlot Series 2000 F
(FGIC Insured), 5.45%, 10/6/00 5,000
Nassau County RAN, Series A, (First Union
National Bank LOC),
5,000 6.00%, 3/20/01 5,034
4,000 6.00%, 4/12/01 4,031
11,500 New York City G.O. VRDB, Series J-2,
Fiscal 1996 5.60%, 10/6/00 11,500
11,785 Suffolk County Industrial Development
Agency ROC, Series 1999-B-IIR (AMT),
(AMBAC Insured), 5.67%, 10/6/00 11,785
----------
37,350
----------
NORTH CAROLINA - 1.6%
2,000 Brunswick County IDR PCR VRDB,
Series 1996 (AMT), Armada Project
(Bank of America LOC), 5.70%, 10/6/00 2,000
5,100 Capital Region Airport Commission
Passenger Facilities Charge Revenue
VRDB (AMT) (First Union National Bank
LOC), 5.70%, 10/6/00 5,100
7,000 Catawba County IDR PCR Bonds,
Series 1996 (AMT), Hooker Furniture Corp.
Project (Bank of America LOC),
5.70%, 10/6/00 7,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
29
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
NORTH CAROLINA - 1.6% (CONT'D.)
$ 3,000 Columbus County Industrial Facilities
PCR VRDB, Series 1998 (AMT),
Conflandey, Inc. Project (Banque
Nationale De Paris LOC), 5.75%, 10/6/00 $ 3,000
2,200 Mecklenburg County IDR PCR VRDB,
Series 1996 (AMT), SteriGenics
International Project (Comerica Bank
LOC), 5.55%, 10/6/00 2,200
7,385 North Carolina State G.O. Unlimited
VRDN, Series A ROC48, 5.62%, 10/6/00 7,385
12,000 North Carolina State G.O. VRDN,
Series A, Smith Barney ROC1-12,
4.50%, 11/2/00 12,000
3,400 North Carolina State Ports Authority
VRDN, Series 1996 (AMT), Morehead
City Terminals, Inc. (Bank of America LOC),
5.70%, 10/6/00 3,400
----------
42,085
----------
NORTH DAKOTA - 1.4%
31,500 North Dakota State HFA Housing Finance
Program Bonds (AMT), Series D, (Hypo-
Vereinsbank LOC), 4.45%, 8/27/01 31,500
4,915 North Dakota State HFA Housing Finance
Program Bonds (AMT), Series PT-1189,
P-Floats, 4.00%, 10/19/00 4,915
----------
36,415
----------
OHIO - 1.4%
1,800 Cleveland Airport System Revenue Bond,
Series A (AMT), (FSA Insured), 4.35%,
1/1/01 1,799
6,000 Jackson Local School District BAN,
Stark & Summit Counties,
4.75%, 11/1/01 6,002
$22,000 Student Loan Funding Corp. Senior
Revenue Refunding Bonds, Series 1998A-1
(AMT),
5.50%, 10/6/00 $22,000
4,000 Summit County IDR Bond (AMT),
Arch Aluminum & Glass Co. Inc.,
(Comerica Bank LOC), 5.75%, 10/6/00 4,000
2,075 Union County Industrial Revenue Bonds
(AMT), Union Aggregates Co. Project
(PNC Bank LOC), 5.60%, 10/6/00 2,075
----------
35,876
----------
OKLAHOMA - 1.3%
6,990 Oklahoma HFA SFM Revenue VRDB,
Class B (AMT), (Colld. by U.S.
Government Securities), 5.65%, 10/6/00 6,990
4,395 Oklahoma HFA SFM Revenue VRDB, Series 1996
B (AMT), PT-78, 5.67%, 10/6/00 4,395
Tulsa Airports Improvement Variable Rate
Certificates, (MBIA Insured),
6,495 Series B-1, 5.67%, 10/6/00 6,495
14,190 Series B-2, 5.67%, 10/6/00 14,190
2,575 Tulsa Community College Area School
District G.O. Bonds, 4.00%, 4/1/01 2,568
----------
34,638
----------
OREGON - 1.7%
1,100 Metropolitan Service District Riedel
Compost Waste Disposal VRDN (AMT)
(U.S. Bank LOC), 5.70%, 10/6/00 1,100
7,700 Oregon Economic Development Revenue
VRDB, Series 176 (AMT), Cascade Steel
Rolling Mills Project (Wells Fargo Bank
LOC), 5.65%, 10/6/00 7,700
30,100 Port of Portland Public Grain Elevator
VRDB, Columbia Grain Inc. Project,
(Chase Manhattan Bank LOC), 5.65%, 10/6/00 30,100
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
30
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 6,600 State of Oregon Revenue VRDN, Series 181
(AMT), Oregon Metal Slitters, Inc.
(Key Bank LOC), 5.65%, 10/6/00 $ 6,600
----------
45,500
----------
PENNSYLVANIA - 3.8%
1,540 Allegheny County Adjustable Rate Bonds,
Series C-41, 5.50%, 10/6/00 1,540
3,865 Allegheny County Hospital Development
Authority Revenue VRDN, South Hills
Health System, (PNC Bank LOC),
4.30%, 4/1/01 3,863
7,495 Beaver County IDA PCR VRDN,
Series PA-602, Ohio Edison Project
(Merrill Lynch & Co., Inc. Gtd.),
5.77%, 10/6/00 7,495
3,600 Chester County IDA Bonds, Series 1997 (AMT),
KAC III Realty Corp. Project (PNC Bank LOC),
5.60%, 10/6/00 3,600
22,495 Delaware Valley Regional Financing
Authority Local Government Revenue
VRDB, Merrill Lynch P-Floats,
Series 1997 A PT-1004 (AMBAC Insured),
5.72%, 10/6/00 22,495
11,905 Delaware Valley Regional Financing
Authority Local Government Revenue
VRDN, Merrill Lynch P-Floats PT-152
(AMBAC Insured), 4.45%, 12/14/00 11,905
1,380 Lancaster County Solid Waste Revenue Bonds,
Series A (AMT) (AMBAC Insured), 5.00%,
12/15/00 1,382
3,400 Pennsylvania Economic Development Financing
Authority Economic Development Revenue VRDB,
Series 1996 A1-8 (AMT) (PNC Bank LOC),
5.60%, 10/6/00 3,400
10,145 Pennsylvania Economic Development
Financing Authority Bond, Series 1999
(AMT), Approved Solid Waste Projects
(Bayerische Landesbank GIC), 4.10%, 12/15/00 10,145
Pennsylvania Higher Education Facilities
Authority Revenue Bond, Association of Independent
Colleges & Universities, (PNC Bank LOC),
$ 3,250 Series D5, 4.35%, 5/1/01 $ 3,250
3,100 Series F2, 5.50%, 5/1/01 3,114
Pennsylvania Higher Education Facilities
Authority Revenue Bond,
Association of Independent Colleges &
Universities, (Allied Irish Bank LOC),
4,900 Series C1, 4.35%, 5/1/01 4,900
7,500 Series F3, 5.50%, 5/1/01 7,533
3,125 Pennsylvania Housing Financing Agency SFM
Revenue Bonds, Series 229 (AMT), 5.82%,
10/6/00 3,125
7,000 Philadelphia Hospitals & Higher
Education Facilities VRDN, Series B,
Jefferson Health System, 4.375%, 3/27/01 7,000
4,730 Pittsburgh Urban Redevelopment
Authority Mortgage Revenue Notes,
Series C (AMT), FNMA, 4.70%, 5/22/01 4,730
3,800 Washington County IDR VRDN
(AMT), Accutrex Products, Inc. (Mellon
Bank LOC), 5.70%, 10/6/00 3,800
----------
103,277
----------
SOUTH CAROLINA - 0.4%
5,000 South Carolina Jobs Economic
Development Revenue VRDB, Virtual
Image Technology LLC, Series 1998 (AMT)
(Bank of America LOC), 5.75%, 10/6/00 5,000
5,175 South Carolina School Facilities
G.O. ROC, Series 2000, 5.62%, 10/6/00 5,175
----------
10,175
----------
SOUTH DAKOTA - 0.6%
8,410 South Dakota Economic Development
Finance Authority VRDB, Series 1996
(AMT), Hastings Filters, Inc. Project
(Harris Trust & Savings Bank LOC),
5.50%, 10/6/00 8,410
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
31
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
SOUTH DAKOTA - 0.6% (CONT'D.)
$ 7,280 South Dakota HDA Homeownership
Revenue VRDB, Series 231 (AMT),
5.87%, 10/6/00 $ 7,280
----------
15,690
----------
TENNESSEE - 2.4%
3,500 Cumberland County Industrial
Development Board VRDB (AMT),
Delbar Products Inc., (PNC Bank LOC),
5.60%, 10/6/00 3,500
1,100 Dickson County IDR VRDB, Series 1996
(AMT), Tennessee Bun Co. LLC Project
(PNC Bank LOC), 5.60%, 10/6/00 1,100
6,000 Jackson City Industrial Development
Board Waste Facility VRDB, Series 1995
(AMT), Florida Steel Corp. Project
(Bank of America LOC), 5.70%, 10/6/00 6,000
4,500 Johnson City Health & Education
Facilities Refunding VRDB,
Series 2000-A (MBIA Insured),
5.60%, 10/6/00 4,500
9,000 Knox County Health Education Housing
VRDB, (Caisse des Depots et Consignations
LOC), 5.60%, 10/6/00 9,000
14,815 Memphis-Shelby County Airport
Authority Airport Revenue VRDB (AMT)
(AMBAC Insured), 5.55%, 10/6/00 14,815
13,675 Metropolitan Nashville & Davidson
Counties Electric Revenue VRDN, Citicorp
Eagle Trust Series 984201,
5.62%, 10/6/00 13,675
1,200 Metropolitan Nashville Health & Education
VRDN, Adventist Health Systems, Series
1996-A, (SunTrust Bank LOC), 5.47%, 10/6/00 1,200
$ 2,000 Morristown City Industrial Development
Board VRDN, BOS Automotive Products,
Series 1997 (AMT) (Hypo-Vereinsbank LOC),
5.70%, 10/6/00 $ 2,000
5,000 Nashville & Davidson County Housing
Revenue VRDB (AMT), Old Hickory Towers
Project (FHLB LOC),
5.60%, 10/6/00 5,000
3,695 Sevier County Public Building Authority
Local Government Public Improvement
VRDB, Series E-2 (AMT) (AMBAC Insured),
5.60%, 10/6/00 3,695
1,000 Shelby County Health & Education
VRDN (AMT), Multifamily Housing-Arbor
Lake Project (PNC Bank LOC),
5.60%, 10/6/00 1,000
----------
65,485
----------
TEXAS - 18.1%
8,950 Aldine Independent School District G.O.
Refunding VRDB, Municipal Securities
Trust Receipts, Series 1997 SGB 29, (PSF of
Texas Gtd.), 5.62%, 10/6/00 8,950
6,630 Austin Water and Wastewater System
VRDB, ABN AMRO Munitops Certificates,
(MBIA Insured), 5.69%, 10/6/00 6,630
7,500 Austin Water and Wastewater System
VRDB, First Union Merlot Series 2000,
(MBIA Insured), 5.50%, 10/6/00 7,500
12,600 Bastrop Independent School District
VRDN, Municipal Securities Trust
Receipts, Series 1997 SGB 37 (PSF of
Texas Gtd.), 5.62%, 10/6/00 12,600
9,770 Bexar County Housing Finance Corp.
VRDB, Multifamily Housing Series PT-1238,
Merrill Lynch Capital Services Inc.,
5.77%, 10/6/00 9,770
40,000 Brazos River Authority PCR Refunding
VRDB, Series C3 (Bank of America Corp.
LOC), 4.85%, 6/19/00 40,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
32
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$10,600 Brazos River Authority PCR VRDB,
Series 1997-A (AMT), Texas Utilities
Electric Co. Project (MBIA Insured),
5.70%, 10/2/00 $10,600
8,000 Brazos River Harbor District VRDB,
Series 1996 (AMT), BASF Corp. Project
(BASF Corp. Gtd.), 5.70%, 10/2/00 8,000
8,000 Brazos River Harbor Navigation District
Brazoria County VRDN (AMT),
(BASF Corp. Gtd.), 5.70%, 10/2/00 8,000
2,200 Brazos River Harbor Navigation VRDN
(AMT), Dow Chemical Co. Project,
(Dow Chemical Co. Gtd.),
5.75%, 10/2/00 2,200
5,000 Calhoun County Navigation IDA
VRDN (AMT), Formosa Plastics Corp.
USA (Bank of America Corp. LOC),
5.55%, 10/6/00 5,000
2,800 Comal Independent School District
VRDN, ABN-AMRO MuniTops, Series 99-9
(PSF of Texas Gtd.), 5.67%, 10/6/00 2,800
7,640 Cypress-Fairbanks Independent School
District VRDB, Citibank Eagle Trust
No. 4304, Series 2000, 5.30%, 10/6/00 7,640
7,295 Dallas G.O. Refunding VRDB, Morgan
Stanley Floating Rate Certificates,
Series 93, 5.62%, 10/6/00 7,295
3,000 Dallas Ft. Worth Regional Airport
Revenue Refunding Bonds, Citibank
TOB, Series A (FGIC Insured),
4.35%, 11/1/00 3,000
13,310 Dallas Ft. Worth Regional Airport
Revenue Refunding Bonds, Soc Gen
Municipal Trust No. 5, Series 1995,
(FGIC Insured), 5.62%, 10/6/00 13,310
8,000 Denton County Independent School
District G.O.Bonds, Series B, (PSF of
Texas Gtd.), 4.40%, 8/15/01 8,000
$ 3,500 El Paso City Housing Financing Corp.
VRDB, Series 1993 (AMT), Viva
Apartments Project (General Electric
Corp. LOC), 5.95%, 10/6/00 $ 3,500
7,790 Galveston County Housing Finance
Corp. SFM VRDN, P-Floats,
Series PT-205 (AMT) (Colld. by U.S.
Government Securities), 5.67%, 10/6/00 7,790
8,400 Greater Texas Student Loan Revenue
Bonds, Series A (AMT) (SLMA LOC),
4.22%, 2/1/01 8,400
4,525 Harris County Development Corp. IDR
VRDB, North American Galvanizing,
Series 2000 (AMT) (Bank One LOC),
5.75%, 10/6/00 4,525
4,000 Harris County IDA Solid Waste
Disposal VRDB (AMT), Deer Park
Refining, 5.75%, 10/2/00 4,000
11,510 Harris County G.O. Subordinate Lien
Toll Road VRDB, Series 1999,
5.50%, 10/6/00 11,510
11,420 Harris County Toll Road Unlimited
Tax Revenue VRDN, Citicorp Eagle
Trust No. 954302, Series 1994-A,
5.62%, 10/6/00 11,420
11,880 Harris County Toll Road Unlimited
Tax Subordinate Lien Revenue VRDN,
Series CR138, 5.62%, 10/6/00 11,880
8,000 Hockley County Industrial Development
Corp. PCR VRDB, Amoco Project, (Amoco
Oil Co. Gtd.), 4.30%, 11/1/00 8,000
9,485 Houston Higher Education Financing
Authority VRDB, Soc Gen Municipal
Trust No. 83, Rice University Project,
5.70%, 10/6/00 9,485
2,000 Houston Water and Sewer VRDB,
Citicorp TOB, Series CR-2L,
(MBIA Insured), 5.50%, 10/6/00 2,000
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
33
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
TEXAS - 18.1% (CONT'D.)
$ 7,240 Lower Colorado River Authority
Revenue Bonds, Series A (AMBAC Insured),
4.00%, 11/9/00 $ 7,240
2,100 North Texas Higher Educational
Authority Student Loan Revenue VRDB,
Series 1996-C (AMT) (AMBAC Insured),
5.50%, 10/6/00 2,100
16,600 Nueces River Authority Water Supply
VRDN, Series 97430, Corpus Christi
Lake Project (FSA Insured),
5.62%, 10/6/00 16,600
5,000 Port Arthur Navigation District
Revenue VRDN, Series 1998 (AMT),
BASF Corp. Project (BASF Corp. Gtd.),
5.70%, 10/2/00 5,000
18,425 Port Arthur Navigation District VRDN,
Series 1998 (AMT), Fina Oil &
Chemical Co. Project (Fina, Inc. Gtd.),
5.75%, 10/2/00 18,425
Port of Corpus Christi VRDN (AMT),Koch
Refining Co. Project (Koch Industries Gtd.)
48,400 5.65%, 10/6/00 48,400
25,000 Series 1996, 5.65%, 10/6/00 25,000
9,000 Sabine River PCR VRDN, Series 1996-B,
Texas Utilities Electric Co. Project,
(AMBAC Insured), 5.65%, 10/2/00 9,000
2,970 San Antonio Airport Revenue Refunding VRDN,
Series 1993, Citicorp Eagle Trust No. 96C4304
(AMBAC Insured), 5.67%, 10/6/00 2,970
State of Texas TRAN, Lehman Daily
Floating Trust Receipts, Series 2000,
20,000 5.65%, 10/2/00 20,000
16,000 5.60%, 10/6/00 16,000
42,000 State of Texas TRAN, Series A,
5.25%, 8/31/00 42,356
12,900 Tarrant County Water Control District
Refunding & Improvement VRDN,
Series 1999, (Colld. By U.S. Government
Securities), 5.75%, 3/1/01 12,971
$ 4,015 Texas A&M
University Financing System
Revenue Bonds, Morgan Stanley Floating
Rate Trust Certificates 2000, Series 300,
5.62%, 10/6/00 $ 4,015
5,666 Texas Department of Housing & Community
Affairs SFM VRDB, Merrill P-Floats PA-128
(AMT) (MBIA Insured), 5.67%, 10/6/00 5,666
4,050 Texas State Department Housing and
Community Affairs Residential Mortgage
Revenue P-Floats-Pt 1192, 4.45%, 10/12/00 4,050
2,470 Texas Veterans Housing Assistance G.O.
Bond, Series 1999-B (AMT), Merrill P-Floats
PT-453, 4.45%, 2/8/01 2,470
700 Trinity River IDA VRDB, ADP Inc. Project,
(ADP Inc. Gtd.), 5.65%, 10/2/00 700
----------
486,768
----------
UTAH - 1.3%
4,800 Intermountain Power Agency Supply
Revenue VRDN, Eagle Trust CR-331
(FSA Insured), 5.62%, 10/6/00 4,800
7,665 Intermountain Power Agency Revenue
VRDB, ML/SG Trusts, Series 1995
SG-6 (FSA Insured), 5.62%, 10/6/00 7,665
13,300 Utah Housing Financing Agency VRDN,
Series 1999-4 (AMT), 5.60%, 10/6/00 13,300
10,000 Utah Housing Financing Agency VRDN,
Series 2000 C-1 (AMT), (FHA Gtd.)
5.60%, 10/6/00 10,000
----------
35,765
----------
VERMONT - 0.7%
Vermont Housing Finance Agency
Single Family Housing Notes (AMT)
17,500 Series 12C, 4.25%, 3/9/01 17,500
----------
VIRGINIA - 1.7%
3,400 Botetourt County IDA IDR VRDN
(AMT), Valley Forge Co. Project
(Harris Trust & Savings Bank LOC),
5.55%, 10/6/00 3,400
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
34
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
$ 2,060 Emporia City IDA IDR Bonds,
Series 1999 (AMT) (Bank of America LOC),
5.70%, 10/6/00 $ 2,060
3,600 Halifax County IDA VRDN,
Series 1998 (AMT), D-Scan, Inc.
Project (Bank of America LOC),
5.70%, 10/6/00 3,600
16,800 Norfolk City G.O. Bonds, Eagle Trust
Series 944601,
5.62%, 10/6/00 16,800
3,400 Virginia College Building Authority
Bonds, Equipment Leasing Program,
4.25%, 2/1/01 3,400
5,560 Virgina Commonwealth Transportation
Board Revenue VRDB, US Route 58
Corridor, Eagle Trust Series 994601,
5.62%, 10/6/00 5,560
11,815 Virginia State G.O. Bonds, Citicorp
Eagle Trust Series 954601,
5.62%, 10/6/00 11,815
----------
46,635
----------
WASHINGTON - 4.9%
10,000 Chelan County Public Utilities District
No. 1 VRDN, Series A (AMT),
5.55%, 10/6/00 10,000
1,000 Kent City Economic Development Corp.
IDR VRDN, Associated Grocers Project
(Bank of America LOC), 5.10%, 10/6/00 1,000
7,175 King County Housing Authority VRDN
(AMT), Overlake Todd Project, (Bank of
America LOC), 5.70%, 10/6/00 7,175
1,550 King County G.O. Public Transportation
Sales Tax Bonds, 4.625%, 12/1/00 1,551
9,525 King County Sewer Revenue VRDB, Merlot Series
2000 E (FGIC Insured), 5.50%, 10/6/00 9,525
3,215 Port of Seattle G.O. VRDN, Series 23 (AMT),
5.72%, 10/6/00 3,215
$ 2,075 Snohomish County G.O. Refunding
Bonds, School District No. 15 (FGIC
Insured), 4.50%, 12/1/00 $ 2,076
4,125 Washington Economic Development
Finance Authority VRDB, American
Millwork Project, Series 2000-C (AMT),
(FHLB LOC), 5.50%, 10/6/00 4,125
5,000 Washington Public Power Supply System Revenue
Bonds, Nuclear Project No. 2, Merrill
P-Floats PT-432, (Colld. By U.S.
Government Securities), 4.50%, 6/14/01 5,000
21,200 Washington Public Power Supply System
Revenue VRDN, Citicorp Eagle Trust
Series 944701, 5.72%, 10/6/00 21,200
Washington State G.O. Refunding VRDB,
13,300 Eagle Trust Series 1993-B, 5.62%, 10/6/00 13,300
27,095 Eagle Trust Series 1993-C, 5.62%, 10/6/00 27,095
9,950 Washington State G.O. VRDN,
Smith Barney SGB-13, Series 1993 B,
5.62%, 10/6/00 9,950
4,000 Washington State Housing Finance
Commision Single Family Program Notes,
Series 1A-S (AMT), 4.20%, 2/1/01 4,000
5,300 Washington State Housing Finance
Commision Mortgage Revenue VRDB,
Wandering Creek, Series 1995 (AMT)
(FHLMC Gtd.), 5.95%, 10/6/00 5,300
8,665 Washington State Various Purpose G.O.
VRDB, Eagle Trust Series No. 20004701,
Series 2000-B, 5.62%, 10/6/00 8,665
----------
133,177
----------
WEST VIRGINIA - 1.3%
Marion County Solid Waste Disposal
Revenue VRDB, Granttown Project,
(National Westminster Bank LOC),
3,300 Series B (AMT), 5.50%, 10/6/00 3,300
21,100 Series C (AMT), 5.50%, 10/6/00 21,100
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
35
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS - 99.3%
(CONT'D.)
WEST VIRGINIA - 1.3% (CONT'D.)
$ 2,000 Ritchie County IDR VRDN, Simonton
Building Products (PNC Bank LOC),
5.60%, 10/6/00 $ 2,000
4,500 West Virginia Economic Development
Authority IDR VRDN, Series 1999 (AMT),
Rubberlite, Inc. Project (Bank of
America LOC), 5.75%, 10/6/00 4,500
5,000 West Virginia Water Development Authority
Bonds, Water Development Revenue Loan
Program II, Series A (Colld. By U.S.
Government Securities), 7.70%, 11/1/00 5,115
----------
36,015
----------
WISCONSIN - 3.7%
2,300 Fond Du Lac BAN, 4.40%, 5/1/01 2,300
3,150 Menomonie Area School District BAN,
4.25%, 11/1/00 3,150
5,000 Milwaukee City Promissory Notes,
Series 2000 A, 5.60%, 10/6/00 5,000
2,180 Milwaukee County Airport G.O. Refunding
VRDB, Series 1996 A, (AMBAC Insured),
5.00%, 10/1/00 2,180
5,515 Milwaukee Metropolitan Sewerage District
G.O. Refunding Bonds, P-Float PT-1173,
Series 1997 A, 4.45%, 9/20/01 5,515
5,000 Milwaukee Metropolitan Sewerage
District VRDB, Series A, 4.25%, 10/1/00 5,000
2,775 Milwaukee Redevelopment Authority
Refunding VRDB, Starline Manufacturing,
Inc., Series 1996 (AMT) (Harris Trust &
Savings Bank LOC), 5.55%, 10/6/00 2,775
5,325 Oak Creek IDR VRDB, Series 1999 A
(AMT), Fort Howard Steel, Inc. Project
(Bank One LOC), 5.75%, 10/6/00 5,325
$ 4,290 Pewaukee IDR VRDB, Series 1992 (AMT), HUSCO
International, Inc. Project (Bank One LOC),
5.65%, 10/6/00 $ 4,290
850 Sheboygan PCR Bonds, Series 1995,
Wisconsin Electric Power Co. Project
(Wisconsin Electric Co. Gtd.),
5.45%, 10/6/00 850
3,600 Two Rivers Public School District BAN,
5.10%, 3/1/01 3,602
11,550 Wisconsin Clean Water Revenue Bonds, Merrill
Lynch P-Floats PT-1181, Series 1999, 4.45%,
8/9/01 11,550
4,000 Wisconsin Health & Education Facilities
Authority Revenue Bonds, Medical
College of Wisconsin, Series 1 (Colld. By
U.S. Government Securities), 7.25%, 12/1/00 4,079
2,000 Wisconsin Health & Education Revenue
VRDB, Froedtert Memorial Lutheran
Hospital Trust, Series 1997, (Marshall &
Ilsley Bank LOC), 5.50%, 10/6/00 2,000
3,172 Wisconsin Health & Education Revenue VRDB,
Sinai Samaritan Medical Center, Series 94 A
(Marshall & Ilsley Bank LOC), 5.50%,
10/6/00 3,172
10,000 Wisconsin Housing & Economic
Development Authority Revenue Floating
Rate Trust Receipts, Series 1997 (AMT),
5.70%, 10/6/00 10,000
30,000 Wisconsin Housing & Economic
Development Authority Single Family
Drawdown Revenue VRDB, Series PT-323
(AMT), 5.72%, 10/6/00 30,000
----------
100,788
----------
WYOMING - 0.1%
1,500 Lincoln County PCR VRDB, Pacificorp
Project, 5.60%, 10/6/00 1,500
2,000 Sweetwater County PCR VRDB, Series 1984,
Pacificorp Project, 5.75%, 10/2/00 2,000
----------
3,500
----------
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
36
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
--------------------------------------------------------------------------------
<S> <C> <C>
MULTIPLE STATES POOLED SECURITIES - 1.1%
$13,900 Pooled Puttable Float Option, Series
PPT-7D (AMT)(Backed by Various
Housing Agencies),
4.50%, 1/25/01 $ 13,900
765 Pooled Puttable Floating Option,
Series PPT-2 (AMT)(Backed by AK HFC),
5.95%, 10/2/00 765
14,540 Greystone County Variable Rate Senior
Certificate Trust, Series 1998-1
(Credit Suisse First Boston LOC),
5.58%, 10/6/00 14,540
----------
29,205
----------
Total Municipal Investments
(Cost $2,675,102) 2,675,102
----------
NUMBER OF SHARES VALUE
(000s) (000S)
--------------------------------------------------------------------------------
<CAPTION>
<S> <C> <C>
OTHER - 0.1%
849 AIM Tax Free Money Market Fund $ 849
800 Dreyfus Tax-Exempt Cash
Management Fund 800
1,133 Federated Municipal Obligations Fund 1,133
320 Federated Tax Free Trust Money Market
Fund No. 15 320
500 Federated Tax Free Trust Money Market
Fund No. 73 500
219 Provident Municipal Cash Fund (AMT) 219
298 Provident Municipal Fund 298
----------
Total Other
(Cost $4,119) 4,119
----------
Total Investments - 99.4%
(Cost $2,679,221) 2,679,221
Other Assets less Liabilities - 0.6% 15,569
----------
NET ASSETS - 100.0% $2,694,790
==========
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
37
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
CALIFORNIA MUNICIPAL MONEY MARKET FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS 98.9%
CALIFORNIA 87.8%
$ 3,000 Adelanto Public Utilities Authority
Revenue Bonds, Series 2000 B, Utility
System Project (California State Teachers
Retirement System LOC),
4.65%, 10/6/00 $ 3,000
3,580 Anaheim California Housing Authority,
Multifamily Housing Cobblestone
Apartments, Series 2000 (AMT)
(FNMA LOC)
4.50%, 10/6/00 3,580
2,500 Anaheim Union High School District
COP, 1999 School Facility Bridge
(FSA Insured),
4.50%, 10/6/00 2,500
1,100 California Alternative Energy Source
Cogeneration Revenue (AMT), General
Electric Capital Project,
4.45%, 10/6/00 1,100
6,000 California Community College Financing
Authority, TRAN, Series 2000 B,
5.00%, 8/3/01 6,059
10,000 California Economic Development
Financial Authority Revenue Bond,
Series 2000, California Independent
System Operator Corp. Project
(MBIA Insured),
4.40%, 10/2/00 10,000
6,000 California Health Facilities Financing
Authority FRN, Morgan Stanley Muni
Trust, Series 1998-26, Kaiser Permanente
(FSA Insured),
4.82%, 10/6/00 6,000
800 California Health Facilities Financing
Authority Revenue Bonds, Series 1991,
Children's Hospital (MBIA Insured),
4.40%, 10/6/00 800
California HFA Home Mortgage Revenue
FRN,
1,060 Series 1991G, Merrill P-Floats PT-40D (AMT),
4.05%, 2/22/01 1,060
5,440 Series 1993 B, Merrill P-Floats PT-14,
4.10%, 10/6/00 5,440
$ 4,000 California HFA Home Mortgage
Revenue FRN, Series S (AMT),
4.25%, 8/1/01 $ 4,000
7,330 California HFA Housing Revenue FRN,
Series A-2 PT-258 (AMT), SFM Bonds,
4.60%, 10/6/00 7,330
7,125 California HFA Multifamily Housing
Revenue FRN, Series III-D A (AMT)
(Morgan Guaranty Trust Co. LOC),
2.65%, 10/6/00 7,125
2,900 California HFA Multi-Unit Housing
Revenue FRN, Series 92A CR-231
(MBIA Insured),
4.82%, 10/6/00 2,900
600 California Pollution Control Finance
Authority Bond Series F, Pacific
Gas & Electric Co. (BNP Paribas LOC)
4.70%, 10/2/00 600
400 California Pollution Control Finance
Authority PCR Bonds, Series 1994 (AMT),
Atlantic Richfield Co. Project (Atlantic
Richfield Co. Gtd.),
4.70%, 10/2/00 400
1,300 California Pollution Control Finance
Authority PCR Bond, Series 1997 A,
Pacific Gas & Electric Co. (Toronto
Dominion Bank LOC)
4.70%, 10/2/00 1,300
2,050 California Pollution Control Finance Authority
PCR Bond, Series 1997 B (AMT), Air Products
Manufacturing Co. (Air Products & Chemicals Corp.
Gtd.), 4.70%, 10/6/00 2,050
7,995 California Rural Home Mortgage
Finance Authority, Series B, P-Floats
PT-346 (AMT), SFM Backed Securities
(Colld. By U.S. Government Securities),
4.60%, 10/6/00 7,995
7,000 California School Cash Reserve Program
Authority Pool Bonds, Series 2000 A,
5.25%, 7/3/01 7,050
2,200 California School Facilities Financing
Corp. COP, Series D (KBC Bank LOC),
4.30%, 10/6/00 2,200
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
38
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
$ 7,455 California State Department of Water
Resources VRDN, ML/SG Muni Trust
Receipts, Series SG-5, CVP,
4.52%, 10/6/00 $ 7,455
20,190 California State G.O. Bank of America
Corp. Variable Rate Certificate,
Series 1997 H (Colld. By
U.S. Government Securities),
5.62%, 10/6/00 20,190
7,300 California State G.O. Bonds
4.75%, 10/6/00 7,300
California State G.O., Citibank TOB
(FGIC Insured),
8,200 Series CR-52, 5.55%, 10/6/00 8,200
1,700 Series 5027 C, 5.55%, 10/6/00 1,700
4,000 California State G.O. CP, Series A
3.85%, 12/5/00 4,000
8,000 California State G.O., Eagle Trust,
Series 990501,
4.82%, 10/6/00 8,000
5,000 California State G.O., Merlot Series,
4.75%, 10/6/00 5,000
9,640 California State G.O., Revenue
Refunding Bonds, P-Floats PT 1194,
3.70%, 10/19/00 9,640
2,600 California State Public Works Board,
Series 2000-B, Bank of America Variable
Rate Certificates, Series 1993-A, University
of California, (MBIA Insured),
4.77%, 10/6/00 2,600
18,800 California State Universities & Colleges
Revenue Bonds, Various Series
(AMBAC Insured),
5.50%, 10/6/00 18,800
5,000 California State Veterans G.O. Bonds,
Merlot Series 2000-A (AMT)
(AMBAC Insured),
4.80%, 10/6/00 5,000
8,330 California State Veterans G.O. Bonds
P-Floats PT-365 (AMT),
4.60%, 10/6/00 8,330
3,500 California Statewide Community
Development Authority IDR Bonds,
Series 1998 A (AMT), A & B Die
Casting Co. (Bank of America LOC),
4.45%, 10/6/00 3,500
$ 1,550 California Statewide Community
Development Authority Multifamily
Housing Revenue Bond, Series S (AMT),
Concord Green Apartments (FHLB LOC),
4.45%, 10/6/00 $ 1,550
1,300 California Statewide Community
Development Authority, Series C (AMT),
Nichols Pistachio Project
(Bank of America LOC),
4.45%, 10/6/00 1,300
5,500 California Statewide Community
Development Authority TRAN, Series A,
5.25%, 6/29/01 5,538
2,500 Campbell Union School District G.O.
TRAN, Series 1999,
4.25%, 11/1/00 2,501
1,100 Chico Multifamily Housing Revenue
Bonds, Series 1993 A, Ceres Plaza Project
(Chase Manhattan Bank LOC),
4.40%, 10/6/00 1,100
Chula Vista IDR Bond, San Diego
Gas & Electric Co. (San Diego Gas &
Electric Co. Gtd.),
800 Series 1996 A, 5.00%, 10/2/00 800
13,320 Series 1996 B (AMT), 5.10%, 10/2/00 13,320
17,835 Contra Costa County Home Mortgage
Revenue Bank of America Variable Rate
Certificates, Series 1997 C (Colld. by U.S.
Government Securities),
4.77%, 10/6/00 17,835
4,900 Contra Costa County Multifamily Housing
Revenue Bonds, Delta Square Apartments
(Colld. by U.S. Government Securities),
4.30%, 10/6/00 4,900
6,000 Contra Costa County Multifamily
Housing Revenue Bonds (AMT), Lafayette
Town Center Apartments (Colld. by U.S.
Government Securities),
4.45%, 10/6/00 6,000
1,500 Dry Creek California Joint Elementary
School District TRAN,
4.50%, 10/1/01 1,507
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
39
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
CALIFORNIA MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS 98.9% (CONT'D.)
CALIFORNIA 87.8% (CONT'D)
$ 1,200 Hayward California Multifamily Housing
Revenue Bonds, Series 1984 A, Shorewood
Apartment Project (FGIC Insured),
4.40%, 10/6/00 $ 1,200
9,500 Irvine California Assessment District
No. 87-8, Limited Obligation
Improvement Bonds (KBC Bank LOC),
4.75%, 10/2/00 9,500
1,748 Irvine California Assessment District
No. 95-12, Limited Obligation
Improvement Bonds (KBC Bank LOC),
4.75%, 10/2/00 1,748
2,092 Irvine California Assessment District
No. 97-17, Limited Obligation
Improvement Bonds
(Hypo Vereinsbank LOC),
4.75%, 10/2/00 2,092
Kern County Public Facilities Project COP
(Bayerische Landesbank LOC),
2,200 Series A, 4.50%, 10/6/00 2,200
4,700 Series D, 4.50%, 10/6/00 4,700
900 Lancaster California Redevelopment
Agency Revenue Bonds, Westwood
Park Apartments, Series K
(Bank of America Corp. LOC),
4.30%, 10/6/00 900
1,525 Los Angeles Convention and Exhibition
Center Revenue VRDN, Series 1993 PA-88,
Merrill P-Floats (MBIA Insured),
4.52%, 10/6/00 1,525
5,000 Los Angles County Schools Pooled
Finance Program TRAN, Series A,
5.00%, 7/2/01 5,026
3,000 Los Angeles County 2000 TRAN, Series A,
5.00%, 6/29/01 3,018
4,975 Los Angeles Multifamily Housing Revenue
Refunding Bonds, Watts/Athens
Apartments, Series 2000 A (FHLB LOC),
4.40%, 10/6/00 4,975
Los Angeles Unified School District G.O.
Bonds (FGIC Insured),
6,495 SSB ROC No. 24, 4.82%, 10/6/00 6,495
5,650 SSB ROC No. 25, 4.82%, 10/6/00 5,650
$ 3,000 Oakland California Revenue Bonds,
Merlot Series 2000 M (AMBAC Insured),
4.75%, 10/6/00 $ 3,000
5,000 Orange County Apartment Development
Housing Revenue Bonds (AMT),
Wood Canyon Villas Issue B of 1991
(Bank of America Corp. LOC),
4.55%, 10/6/00 5,000
8,000 Orange County Limited Obligation
Improvement Bonds, Irvine Coast
Assessment District No. 88-1
(Societe Generale LOC),
4.75%, 10/2/00 8,000
2,300 Orange County Multifamily Housing
Revenue Bond, Series 1992 A, Heritage
Pointe Project (Allied Irish Bank LOC),
4.35%, 10/6/00 2,300
2,400 Orange County Sanitation Districts 1-3,
5-7, & 11, COP, Series 1992 (AMBAC
Insured), 4.40%, 10/6/00 2,400
1,100 Orange County Sanitation Districts 1-3,
6-7, & 11, Series C (FGIC Insured),
5.00%, 10/2/00 1,100
3,200 Palmdale Community Redevelopment
Mortgage Revenue Bonds, First Union,
Merlot Series 2000 TTT (AMT)
(Colld. by U.S. Government Securities),
4.05%, 9/1/01 3,200
Peninsula Corridor Joint Powers Board,
Grant Anticipation Notes, Series B
(Peninsula Corridor Joint Powers
Bond GIC),
7,500 4.85%, 6/7/01 7,525
3,000 4.40%, 7/25/01 3,005
5,000 Peninsula Corridor Joint Powers Farebox
Revenue Bonds, Series A,
4.45%, 10/13/00 5,001
Placer County Office of Education TRAN,
1,080 4.125%, 10/2/00 1,080
980 4.50%, 10/2/00 985
4,295 Port of Oakland Revenue Bonds,
Series 2000 K (AMT), Paine Webber
Robins 13 Class F (FGIC Insured),
5.12%, 10/6/00 4,295
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
40
<PAGE>
NORTHERN FUNDS Semiannual Report
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
$ 1,400 Riverside County Multifamily Housing
Revenue FRN, Series A, Ambergate
Apartments (Union Bank of
California LOC),
4.65%, 10/6/00 $ 1,400
2,400 Rocklin Unified School District TRAN,
4.125%, 10/2/00 2,400
2,600 Sacramento County Sanitation District
Revenue Bonds, Series 2000 SSS,
First Union Merlot (Colld. by U.S.
Government Securities),
4.10%, 8/1/01 2,600
8,000 San Bernardino County Unified School
District 1999 TRAN,
4.25%, 12/7/00 8,007
12,600 San Diego Housing Authority Multifamily
Housing Revenue Bonds (AMT), Stratton
Apartments, Series 2000 A (FNMA Gtd.),
4.45%, 10/6/00 12,600
3,955 San Diego Public Facilities Financing
Authority Sewer Revenue Bonds, ML/SG
Muni Trust SG-24 (AMBAC Insured),
4.52%, 10/6/00 3,955
5,175 San Francisco City and County Airport
Commission International Airport
Revenue FRN, Second Series (AMT),
PA-661R (FSA Insured),
4.60%, 10/6/00 5,175
4,975 San Francisco City and County G.O.
Variable Rate Certificates, Series 1996-AA6
(FGIC Insured),
4.77%, 10/6/00 4,975
445 Santa Clara County Housing Authority
VRDN, Series A (AMT), Multifamily
Avenida Espana Gardens (Union Bank
of California LOC),
4.80%, 10/6/00 445
4,000 Solano County TRAN, Series B
4.50%, 12/15/00 4,006
6,000 University of California Revenue Bonds,
Eagle Trust Series No. 20000504, Series K,
4.82%, 10/6/00 6,000
$ 6,400 Victor Valley Joint Unified High School
District 1999 TRAN,
4.25%, 11/15/00 $ 6,404
3,800 Western Placer Unified School District
2000 TRAN
4.50%, 10/1/01 3,818
2,415 Windsor Multifamily Housing Revenue
Bonds, Series 1995 A (AMT), Oakmont at
Windsor Project (Chase Manhattan
Bank, LOC),
4.55%, 10/6/00 2,415
----------
408,675
----------
PUERTO RICO - 11.1%
Government Development Bank for
Puerto Rico Tax-Exempt CP,
3,000 4.35%, 11/16/00 3,000
1,500 3.90%, 12/7/00 1,500
4,650 3.90%, 2/27/01 4,650
4,035 Puerto Rico Commonwealth Highway and
Transportation Authority TRB, Salomn
Smith Barney ROC (MBIA Insured),
4.82%, 10/6/00 4,035
4,000 Puerto Rico Commonwealth Highway and
Transportation Authority TRB, Series A
(AMBAC Insured),
4.50%, 10/6/00 4,000
9,000 Puerto Rico Commonwealth Highway
and Transportation Authority TRB,
Series B, Paine Weber Robin 14, Class F
(MBIA Insured),
5.07%, 10/6/00 9,000
12,900 Puerto Rico Electric Power Authority
Revenue Bonds, Salmon Smith Barney
ROC (FSA Insured),
4.82%, 10/6/00 12,900
4,675 Puerto Rico Housing Finance Authority
Mortgage Revenue Bonds, Series 2000 R,
Bank of America Variable Rate Certificates
(Colld. by U.S. Government Securities),
3.80%, 9/6/01 4,675
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
41
<PAGE>
SCHEDULES OF INVESTMENTS SEPTEMBER 30, 2000 (UNAUDITED)
CALIFORNIA MUNICIPAL MONEY MARKET FUND (CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000s) (000s)
-----------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL INVESTMENTS 98.9% (CONT'D.)
PUERTO RICO - 11.1% (CONT'D)
$ 3,000 Puerto Rico Industrial Medical &
Environmental PCR Bonds, Series 1983 A,
Merck & Co. (Merck & Co. Gtd.),
3.80, 12/1/00 3,000
5,000 Puerto Rico Municipal Finance Agency
G.O. Bonds ROC, Series 2000 R-17,
(FSA Insured)
4.82, 10/6/00 $ 5,000
----------
51,760
----------
Total Municipal Investments
(cost $460,435) 460,435
----------
<CAPTION>
NUMBER
OF SHARES
(000s)
-----------------------------------------------------------------------------
<S> <C> <C>
OTHER - 0.1%
470 Federated Tax-Exempt Money Market
Fund No. 80 $ 470
236 Shearson Cal Money Fund Money Fund
No. 52 236
----------
Total Other (cost $706) 706
----------
Total Investments - 99.0%
(cost $461,141) 461,141
Other Assets less Liabilities - 1.0% 4,415
----------
NET ASSETS - 100.0% $ 465,556
==========
</TABLE>
SEE NOTES TO THE FINANCIAL STATEMENTS.
42
<PAGE>
NORTHERN FUNDS Semiannual Report
NOTES TO THE FINANCIAL STATEMENTS
SEPTEMBER 30, 2000 (UNAUDITED)
1. ORGANIZATION
Northern Funds, (the "Trust") is a Delaware business trust, which was formed on
February 7, 2000, and is registered under the Investment Company Act of 1940, as
amended, 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 were
formerly series of Northern Funds, a Massachusetts business trust, and were
reorganized into the Trust on July 31, 2000.
The Funds have entered into an Investment Advisory Agreement with The
Northern Trust Company ("Northern Trust" or the "Adviser"). Northern Trust also
serves as co-administrator, 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 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.
D 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.
E 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.
During the six months ended September 30, 2000, all of the dividends
derived from net investment income paid by each of 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.
43
<PAGE>
F 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 six months
ended September 30, 2000, the Adviser voluntarily agreed to waive a portion of
its advisory fees as shown on the accompanying Statements of Operations.
Northern Trust has 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 waivers and reimbursements of Northern Trust described above are
voluntary and may be terminated by Northern Trust at any time at its discretion.
The Funds have a co-administration agreement with Northern Trust and
PFPC,Inc. ("the co-administrators"), for certain administrative services.
Pursuant to their co-administration agreement with the Funds, the
co-administrators are entitled to receive a fee, computed daily and payable
monthly, at the annual rate of 0.15% of each Fund's daily net assets.
4. BANK LOANS
The Funds maintain a $50,000,000 revolving bank credit line for liquidity and
other purposes. Borrowings under this arrangement bear interest at 0.45% above
the Fed Funds rate.
As of September 30, 2000, there were no outstanding borrowings.
44
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK.
45
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK.
46
<PAGE>
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.
Northern Funds Distributors, LLC, an independent third party.
[NORTHERN FUNDS LOGO]
P.O. Box 75986
Chicago, IL 60675-5986
(800) 595-9111
PRESORTED STANDARD U.S. POSTAGE PAID CHICAGO, IL PERMIT NO. 941
