U.S. Government Fund

U.S. Government

Northern Funds Center by E-mail

Daniel J. Personette

With Northern Trust since 1996
Began Career in 1995

View all holdings as of
June 30, 2010

View all holdings as of
March 31, 2010

Fact Sheet

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You may find this Fund ideal, if you are a conservative investor who prefers the income and quality assurance offered by government securities. It is best suited for investors with relatively low-risk profiles and can provide a solid-core holding for income-oriented investors of all ages. Our approach is to select high-quality securities with maturities between one and 10 years, issued or guaranteed by the U.S. Government, as we manage risk exposure to achieve reasonable returns. We believe investing in a broad range of U.S. Government securities with intermediate-term maturities can provide greater stability of principal than is generally available from longer-term, higher-yielding bonds. The principal value and investment return of the Fund are neither guaranteed or insured by the U.S. Government.

Fund Objective: Current Income

Ticker Symbol	Distribution Rate Daily as of 09/03/10	30 Day SEC Yield Monthly as of July 31, 2010
NOUGX	1.12%	1.02%

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Updated Daily as of September 3, 2010
Symbol	NOUGX	Distribution Rate*	1.12%
CUSIP	665162889	Tax-Equivalent Distribution Rate*	N/A
Share Price	$ 10.43	Updated Monthly as of July 31, 2010
Share Price Change	$ -0.03	Total Net Assets	$92,475,056
YTD Total Return	5.62%	Updated Monthly as of July 31, 2010
Inception Date	4/1/1994	30-Day SEC Yield*	1.02%
		Tax-Equivalent 30-Day SEC Yield*	N/A

Total Returns for Month Ended July 31, 2010
	U.S. Government Fund	Barclays Capital U.S. Intermediate Government Bond Index	Morningstar Intermediate Government Category Average
Month	0.59%	0.74%	0.77%
3-Month	3.20%	3.29%	3.35%
Year to Date	4.90%	5.19%	5.87%
1 Year	5.81%	6.01%	7.98%
3-Year Avg. Annual	6.42%	6.91%	6.92%
5-Year Avg. Annual	4.93%	5.65%	5.28%
10-Year Avg. Annual	5.14%	5.76%	5.49%
Avg. Annual Since Inception	5.21%	Pending%	N/A

Total Returns for Quarter Ended June 30, 2010
	U.S. Government Fund	Barclays Capital U.S. Intermediate Government Bond Index	Morningstar Intermediate Government Category Average
Month	1.38%	1.32%	1.28%
3-Month	3.23%	3.26%	3.40%
Year to Date	4.29%	4.41%	5.05%
1 Year	5.76%	5.68%	8.16%
3-Year Avg. Annual	6.50%	7.08%	6.91%
5-Year Avg. Annual	4.61%	5.31%	4.92%
10-Year Avg. Annual	5.14%	5.75%	5.45%
Avg. Annual Since Inception	5.20%	5.88%	N/A

Performance quoted represents past performance and does not guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than that shown here.

The Advisor has agreed to reimburse certain expenses of the Fund. The contractual reimbursement arrangement is expected to continue until at least July 31, 2011. After this date, the contractual arrangements may be terminated if it is determined to be in the best interest of the Fund and its shareholders. In the absence of fee waivers, yield, total return, growth since inception and dividends would have been reduced. Total return is based on net change in NAV assuming reinvestment of distributions. The 30-day SEC yield more closely reflects the current earnings of the Fund than the total returns.

Disclosure

	Gross Expense Ratio	Net Expense Ratio*
U.S. Government (NOUGX)	1.09%	0.90%
*Includes contractual expense reimbursements that, if not extended, will end on July 31, 2011.

	2009	2008	2007	2006	2005
U.S. Government	0.06%	10.05%	5.92%	3.45%	0.85%
Barclays Capital U.S. Intermediate Government Bond Index	-0.32%	10.43%	8.47%	3.84%	1.68%
Morningstar Category Avg. Intermediate Government	4.74%	4.76%	6.09%	3.47%	1.91%
Performance quoted represents past performance and does not guarantee future results.

as of July 31, 2010

Read the most recent Fund Commentary (as of June 30, 2010)

Number of Holdings	40
Average Duration†	3.9 YRS
Average Maturity	5.0 YRS
Weighted Average Coupon	3.28%
Yield to Maturity	1.90%
Income**	$0.0112
Dividend Schedule	Monthly
Dividend Income Last Quarter	$0.0347
Capital Gain Income Last Quarter	N/A
Benchmark	Barclays Capital U.S. Intermediate Government Bond Index
Morningstar Category	Intermediate Government

Maturity Distribution		Fund
0 - 1 Year		12.9%
1 - 3 Years		32.5%
3 - 5 Years		5.4%
5 - 10 Years		47.7%
10+ Years		1.5%
TOTAL		100.0%

Quality Distribution	Fund	Benchmark
AAA	100.0%	99.8%
AA	0.0%	0.2%
TOTAL	100.0%	100.0%

Sector Weightings	Fund	Benchmark
Treasury	56.9%	71.9%
Mortgage-Backed	24.2%	0.0%
Agency	15.3%	28.1%
Commercial MBS	3.1%	0.0%
Short-Term	0.5%	0.0%
TOTAL	100.0%	100.0%

All data is as of date indicated and subject to change.

Bond Risk: Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer-term issues and in environments of rising interest rates.

Mortgage-Backed Securities Risk: Mortgage-backed investments involve risk of loss due to prepayments and, like any bond, due to default. Because of the sensitivity of mortgage-related securities to changes in interest rates, the Fund’s performance may be more volatile than if it did not hold these securities.

U.S. Government Guarantee: U.S. Government guarantees apply only to the underlying securities of a Fund’s portfolio and not the Fund’s shares.

Barclays Capital U.S. Intermediate Government Bond Index is an unmanaged index including all public obligations of the U.S. Treasury and all publicly issued debt of U.S. government agencies with maturities of up to 10 years. It is not possible to invest directly in an index.

Quality Distribution: Credit quality ratings primarily originate from data compiled by Barclays Capital within their POINT model. They are based on the conservative average of Moody's, Standard & Poor's, and Fitch ratings. If ratings from all three rating agencies disagree, the model assigns the middle rating to the security. If two of the three agree, the model assigns the rating from those two to the security. If none of these three rating agencies has assigned a rating the Fund will assign a rating of NR (non-rated security). The ratings represent the rating agencies' opinions of the quality of the securities they rate. The ratings, expressed in Moody's nomenclature, range from Aaa ("judged to be of the highest quality, with minimal credit risk") to C ("the lowest rated class of bonds, typically in default, with little prospect for recovery of principal or interest"). Ratings are relative and subjective and are not absolute standards of quality.