Bissett U.S. Focus Fund STATEMENTS OF CHANGES IN NET ASSETS For the periods ended December 31, 2012 and 2011 (in 000s) Series O 2012 2011 Increase (decrease) in net assets from operations $ 9,117 $ 12,725 Distributions to unitholders From net investment income (2,984) (2,554) From capital gains — — From return of capital — — Capital unit transactions (2,984) (2,554) Subscriptions 47,803 171,609 Reinvestments 5,538 1,107 Redemptions (69,959) (74,550) (16,618) 98,166 Increase (decrease) in net assets for the period (10,485) 108,337 Net assets — beginning of period 159,240 50,903 Net assets — end of period $ 148,755 $ 159,240 The accompanying notes are an integral part of these financial statements. Franklin <strong>Templeton</strong> Investments Funds 169
STATEMENT OF INVESTMENTS As at December 31, 2012 Mutual Beacon Fund Average Cost Fair Value Shares (000s) (000s) LONG-TERM INVESTMENTS: 93.10% COMMON STOCKS: 84.18% United States: 55.94% ACE Ltd. . . . ........................ Adelphia Recovery Trust, ACC-1, Contingent 26,294 $ 1,444 $ 2,084 Distribution . ...................... Adelphia Recovery Trust, Arahova, Contingent 4,363,220 297 4 Distribution . ...................... 273,503 111 8 Altria Group Inc. ..................... 40,322 774 1,259 American International Group Inc. ......... 65,676 2,016 2,303 Apache Corp. . ...................... 36,352 3,623 2,834 Avon Products Inc. ................... 120,398 1,887 1,718 CB FIM Coinvestors LLC ................ 1,743,420 — — CBS Corp., B ........................ Century Communications Corp., Contingent 45,154 1,484 1,707 Distribution . ...................... Century Communications Corp., Contingent 34,000 — — Distribution . ...................... Century Communications Corp., Contingent 19,000 — — Distribution . ...................... Century Communications Corp., Contingent 154,000 — — Distribution . ...................... Century Communications Corp., Contingent 10,000 — — Distribution . ...................... Century Communications Corp., Contingent 240,000 — — Distribution . ...................... 310,000 — — Cigna Corp. . ........................ 56,625 2,610 3,006 Cisco Systems Inc. .................... 100,958 1,846 1,970 Comcast Corp., Special A . . . ............ 36,402 871 1,300 Comdisco Holding Co. Inc. . . ............ 52 — — CONSOL Energy Inc. .................. 84,980 2,819 2,709 CVS Caremark Corp. .................. 39,534 1,452 1,899 Eli Lilly & Co. ........................ 12,550 451 615 FIM Coinvestor Holdings I, LLC . .......... Global Crossing Holdings Ltd., Contingent 2,180,996 — — Distribution . ...................... Global Crossing Holdings Ltd., Contingent 779,871 — — Distribution . ...................... Global Crossing Holdings Ltd., Contingent 112,000 — — Distribution . ...................... Global Crossing Holdings Ltd., Contingent 70,000 — — Distribution . ...................... Global Crossing Holdings Ltd., Contingent 135,000 — — Distribution . ...................... Global Crossing Holdings Ltd., Contingent 25,000 — — Distribution . ...................... 20,000 — — Google Inc., A . ...................... 2,588 1,431 1,823 Hospira Inc. ........................ 68,744 2,116 2,132 International Automotive Components Group North America, LLC ................. 1,712,964 2,209 870 JPMorgan Chase & Co. ................. 49,910 1,728 2,181 Average Cost Fair Value Shares (000s) (000s) United States: 55.94% (Continued) Lorillard Inc. ........................ 24,603 $ 2,188 $ 2,851 Marathon Oil Corp. .................... 63,453 1,656 1,932 Medtronic Inc. ....................... 102,228 3,560 4,165 Merck & Co. Inc. ..................... 100,650 3,382 4,094 Microsoft Corp. ...................... 176,619 4,912 4,687 Mondelez International Inc., A . . ......... 54,371 1,087 1,376 Morgan Stanley ...................... 145,543 3,460 2,764 News Corp., B ....................... 184,714 3,638 4,814 NYSE Euronext ...................... 56,470 1,709 1,768 Olympus Re Holdings Ltd. .............. 1,880 278 — ON Semiconductor Corp. ............... 237,786 1,503 1,665 Pfizer Inc. .......................... 42,915 750 1,069 Plains Exploration & Production Co. ........ 45,720 2,060 2,132 Raytheon Co. ........................ 17,531 732 1,002 Realogy Holdings Corp. ................ 23,718 449 939 RenaissanceRe Holdings Ltd. ............ 27,306 1,832 2,204 Rowan Companies PLC ................ 50,520 1,670 1,569 SanDisk Corp. ....................... 34,496 1,240 1,492 Stryker Corp. ........................ 14,490 769 789 Symantec Corp. ...................... 76,080 1,227 1,422 The Bankshares Inc. .................. 449,097 5,199 1,844 The Blackstone Group LP ............... 193,508 2,432 2,996 Time Warner Cable Inc. ................ 65,042 4,718 6,281 Transocean Ltd. ...................... 81,312 5,608 3,606 TRW Automotive Holdings Corp. . ......... 41,490 1,730 2,209 Walgreen Co. ........................ 47,733 1,437 1,756 Wells Fargo & Co. .................... 109,792 3,123 3,731 White Mountains Insurance Group Ltd. ..... 7,458 3,938 3,815 WPX Energy Inc. ..................... 236,748 3,865 3,499 Xerox Corp. ......................... 485,398 4,379 3,288 103,700 106,181 United Kingdom: 12.96% BPPLC............................ 164,232 1,126 1,135 British American Tobacco PLC . . ......... 93,823 2,265 4,738 British Sky Broadcasting Group PLC ....... 134,097 1,514 1,679 Canary Wharf Group PLC ............... 953,128 4,790 3,590 Coca–Cola Enterprises Inc. .............. 71,130 1,762 2,242 Imperial Tobacco Group PLC ............ 70,670 2,069 2,721 Marconi Corp., Contingent Distribution ...... 247,000 — 4 Marconi Corp., Contingent Distribution ...... 15,000 — — Marconi Corp., Contingent Distribution ...... 140,000 — 2 Marconi Corp., Contingent Distribution ...... 547,500 — 10 Marconi Corp., Contingent Distribution ...... 147,700 — 4 Marconi Corp., Contingent Distribution ...... 212,000 — 4 Reed Elsevier PLC .................... 181,860 1,518 1,906 RSA Insurance Group PLC .............. 1,355,640 2,383 2,781 Vodafone Group PLC .................. 1,512,275 3,637 3,782 21,064 24,598 The accompanying notes are an integral part of these financial statements. 170 Franklin <strong>Templeton</strong> Investments Funds
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