U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-17F-2
CERTIFICATE OF ACCOUNTING OF SECURITIES AND SIMILAR INVESTMENTS IN THE
CUSTODY OF MANAGEMENT INVESTMENT COMPANIES
PURSUANT TO RULE N-17F-2
1. Investment Company Act File Number: Date Examination completed:
811-05569 July 5, 2006
2. State Identification Number:
AL AK AZ AR CA CO
CT DE DC FL GA HI
ID IL IN IA KS KY
LA ME MD MA MI MN
MS MO MT NE NV NH
NJ NM NY NC ND OH
OK OR PA RI SC SD
TN TX UT VT VA WA
WV WI WY PUERTO RICO
3. Exact name of investment company as specified in registration statement:
FRANKLIN UNIVERSAL TRUST
4. Address of principal executive office: (number, street, city, state, zip
code)
One Franklin Parkway San Mateo, CA 94403
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees of
Franklin Templeton Fund Allocator Series
Franklin Templeton Variable Insurance Products Trust
Franklin Global Trust
Franklin Strategic Series
Franklin Universal Trust
Franklin Strategic Mortgage Portfolio
Franklin Gold and Precious Metals Fund
Franklin Capital Growth Fund
Institutional Fiduciary Trust
Franklin High Income Trust
Franklin Real Estate Securities Trust
Franklin Templeton Limited Duration Income Trust
Templeton Russia and East European Fund, Inc.
Templeton Emerging Markets Fund
Templeton Global Income Fund
Templeton Emerging Markets Income Fund
Franklin Templeton Money Fund Trust
Franklin Investors Securities Trust
Franklin Value Investors Trust
Templeton Global Investment Trust
and the Board of Directors of
Franklin Federal Money Fund
Franklin Money Fund
Franklin Custodian Funds, Inc.
Templeton Dragon Fund, Inc.
Templeton Institutional Funds, Inc.
We have examined management's assertion, included in the accompanying Management
Statement Regarding Compliance with Certain Provisions of the Investment Company
Act of 1940, about the funds' (hereafter referred to as the "Funds") compliance
(see Attachment I) with the requirements of subsections (b) and (c) of Rule
17f-2 under the Investment Company Act of 1940 ("the Act") as of September 30,
2005. Management is responsible for the Funds' compliance with those
requirements. Our responsibility is to express an opinion on management's
assertion about the Funds' compliance based on our examination.
Our examination was conducted in accordance with the standards of the Public
Company Accounting Oversight Board (United States) and, accordingly, included
examining, on a test basis, evidence about the Funds' compliance with those
requirements and performing such other procedures as we considered necessary in
the circumstances. Included among our procedures were the following tests
performed as of September 30, 2005, and with respect to agreement of security
purchases and sales, for the period from July 31, 2005 (the date of our last
examination), through September 30, 2005:
o Inspection of the records of Franklin Templeton Investors Services,
Inc. as they pertain to the security positions owned by the Funds and held
in book entry form.
o Reconciliation of such security positions to the books and records
of the Funds.
o Agreement of a sample of security purchases and sales since our last
report to the books and records of the Funds.
We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Funds' compliance with
specified requirements.
In our opinion, management's assertion that the Funds were in compliance with
the requirements of subsections (b) and (c) of Rule 17f-2 of the Investment
Company Act of 1940 as of September 30, 2005 with respect to securities
reflected in the investment accounts of the Funds is fairly stated, in all
material respects.
This report is intended solely for the information and use of the Board of
Trustees and Board of Directors, management, and the Securities and Exchange
Commission and is not intended to be and should not be used by anyone other than
these specified parties.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
San Francisco, California
July 5, 2006
MANAGEMENT STATEMENT REGARDING COMPLIANCE WITH CERTAIN
PROVISIONS OF THE INVESTMENT COMPANY ACT OF 1940
We, as members of management of the Franklin Templeton Funds indicated in
Attachment I (the "Funds"), are responsible for complying with the requirements
of subsections (b) and (c) of Rule 17f-2, "Custody of Investments by Registered
Management Investment Companies," of the Investment Company Act of 1940. We are
also responsible for establishing and maintaining effective internal controls
over compliance with those requirements. We have performed an evaluation of the
Funds' compliance with the requirements of subsection (b) of Rule 17f-2, as
interpreted in Franklin Investors Securities Trust SEC No-Action Letter
(publicly available September 24, 1992), and subsection (c) of Rule 17f-2 of the
Investment Company Act of 1940, as of September 30, 2005, and for the period
from July 31, 2005 through September 30, 2005.
Based on this evaluation, we assert that the Funds were in compliance with the
requirements of subsection (b) of Rule 17f-2, as interpreted in Franklin
Investors Securities Trust SEC No-Action Letter (publicly available September
24, 1992), and subsection (c) of Rule 17f-2 of the Investment Company Act of
1940, as of September 30, 2005, and for the period from July 31, 2005 through
September 30, 2005, with respect to securities reflected in the investment
accounts of the Funds.
By:
/s/ Galen G. Vetter
---------------------------------
GALEN G. VETTER
CHIEF FINANCIAL OFFICER
6/21/06
---------------------------------
Date
/s/ Jimmy D. Gambill
-----------------------------------
JIMMY D. GAMBILL
SENIOR VICE PRESIDENT AND CHIEF EXECUTIVE
OFFICER-FINANCE AND ADMINISTRATION
6/26/06
----------------------------------
Date
ATTACHMENT I
FUND
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FRANKLIN TEMPLETON FUND ALLOCATOR SERIES: 7/31/05-9/30/05
Franklin Templeton Conservative Target Fund
Franklin Templeton Moderate Target Fund
Franklin Templeton Growth Target Fund
Franklin Templeton Corefolio Allocation Fund
Franklin Templeton Perspectives Allocation Fund
Franklin Templeton Founding Funds Allocation Fund
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST: 7/31/05-9/30/05
Franklin Strategic Income Securities Fund
Franklin Small Cap Value Securities Fund
Franklin Rising Dividends Fund
Franklin Small-Mid Cap Growth Securities Fund
Templeton Global Asset Allocation Fund
Templeton Foreign Securities Fund
Franklin Flex Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
FRANKLIN GLOBAL TRUST: 7/31/05-9/30/05
Fiduciary High Income Fund
Fiduciary Core Fixed Income Fund
Fiduciary Small Capitalization Equity Fund
Fiduciary Large Capitalization Growth and Income Fund
Fiduciary European Smaller Companies Fund
Fiduciary Core Plus Fixed Income Fund
FRANKLIN STRATEGIC SERIES: 7/31/05-9/30/05
Franklin Aggressive Growth Fund
Franklin U.S. Long-Short Fund
Franklin Natural Resources Fund
Franklin Biotechnology Discovery Fund
Franklin Blue Chip Fund
Franklin Global Health Care Fund
Franklin Global Communications Fund
Franklin Strategic Income Fund
Franklin Flex Cap Growth Fund
Franklin Technology Fund
Franklin Small Cap Growth Fund II
Franklin Small-Mid Cap Growth Fund
FRANKLIN UNIVERSAL TRUST 7/31/05-9/30/05
FRANKLIN STRATEGIC MORTGAGE PORTFOLIO 7/31/05-9/30/05
FRANKLIN GOLD AND PRECIOUS METALS FUND 7/31/05-9/30/05
FRANKLIN CAPITAL GROWTH FUND 7/31/05-9/30/05
INSTITUTIONAL FIDUCIARY TRUST: 7/31/05-9/30/05
Money Market Portfolio
Franklin Cash Reserves Fund
Franklin Structured Large Cap Growth Equity Fund
Franklin Structured Large Cap Core Equity Fund
FRANKLIN HIGH INCOME TRUST: 7/31/05-9/30/05
Franklin AGE High Income Fund
FRANKLIN REAL ESTATE SECURITIES TRUST: 7/31/05-9/30/05
Franklin Real Estate Securities Fund
FRANKLIN TEMPLETON LIMITED DURATION INCOME TRUST 7/31/05-9/30/05
TEMPLETON RUSSIA AND EAST EUROPEAN FUND, INC. 7/31/05-9/30/05
TEMPLETON EMERGING MARKETS FUND 7/31/05-9/30/05
TEMPLETON GLOBAL INCOME FUND 7/31/05-9/30/05
TEMPLETON EMERGING MARKETS INCOME FUND 7/31/05-9/30/05
FRANKLIN TEMPLETON MONEY FUND TRUST: 7/31/05-9/30/05
Franklin Templeton Money Fund
FRANKLIN INVESTORS SECURITIES TRUST: 7/31/05-9/30/05
Franklin Floating Rate Daily Access Fund
Franklin Total Return Fund
Franklin Limited Maturity U.S. Government Securities Fund
Franklin Convertible Securities Fund
Franklin Equity Income Fund
Franklin Low Duration Total Return Fund
Franklin Adjustable U.S. Government Securities Fund
FRANKLIN VALUE INVESTORS TRUST: 7/31/05-9/30/05
Franklin Balance Sheet Investment Fund
Franklin MicroCap Value Fund
Franklin Small Cap Value Fund
Franklin Large Cap Value Fund
Franklin Mid Cap Value Fund
TEMPLETON GLOBAL INVESTMENT TRUST 7/31/05-9/30/05
Templeton Income Fund
FRANKLIN FEDERAL MONEY FUND 7/31/05-9/30/05
FRANKLIN MONEY FUND 7/31/05-9/30/05
FRANKLIN CUSTODIAN FUNDS, INC.: 7/31/05-9/30/05
Franklin Growth Fund
Franklin Utilities Fund
Franklin DynaTech Fund
Franklin Income Fund
Franklin U.S. Government Securities Fund
TEMPLETON DRAGON FUND, INC. 7/31/05-9/30/05
TEMPLETON INSTITUTIONAL FUNDS, INC.: 7/31/05-9/30/05
Foreign Equity Series