UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED MANAGEMENT INVESTMENT COMPANY
Investment Company Act file number 811-09381
PayPal Funds
(Exact name of registrant as specified in charter)
2211 North First Street San Jose, CA 95131
(Address of principal executive offices)
Omar J. Paz
2211 North First Street San Jose, CA 95131
(Name and address of agent for service)
Registrant’s telephone number, including area code: 408-967-7000
Date of fiscal year end: December 31, 2011
Date of reporting period: March 31, 2011
| Item 1. | Schedule of Investments. |
| PayPal Money Market Fund of PayPal Funds | ||||
| Schedule of Investments March 31, 2011 (Unaudited) |
(Percentages shown are based on Net Assets) |
|||
| Mutual Fund |
Value |
|||
| Money Market Master Portfolio of Master Investment Portfolio |
$489,414,525 | |||
| Total Investments (Cost—$489,414,525)—100.0% |
489,414,525 | |||
| Other Assets, Less Liabilities—0.0% |
29,172 | |||
| Net Assets—100.0% |
$489,443,697 | |||
PayPal Money Market Fund (the “Money Market Fund”) seeks to achieve its investment objective by investing all of its assets in Money Market Master Portfolio (the “Master Portfolio”), which has the same investment objective and strategies as the Money Market Fund. As of March 31, 2011 the value of the investment and the percentage owned by the Money Market Fund of the Master Portfolio was $489,414,525 and 2.2%, respectively.
The Money Market Fund records its investment in the Master Portfolio at fair value. The Money Market Fund’s investment in the Master Portfolio is valued pursuant to the pricing policy and procedures approved by the Board of Trustees of the Master Portfolio.
| • | Fair Value Measurements—Various inputs are used in determining the fair value of investments. |
These inputs are summarized in three broad levels for financial reporting purposes as follows:
| • | Level 1—price quotations in active markets/exchanges for identical assets and liabilities |
| • | Level 2—other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market- corroborated inputs) |
| • | Level 3—unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Money Market Fund’s own assumptions used in determining the fair value of investments) |
The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Money Market Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to the Money Market Fund’s most recent financial statements as contained in its annual report.
As of March 31, 2011, the Money Market Fund’s investment in the Master Portfolio was classified as Level 2.
| Schedule of Investments March 31, 2011 (Unaudited) | Money Market Master Portfolio | |
| (Percentages shown are based on Net Assets) |
| Certificates of Deposit |
Par (000) |
Value |
||||||
| Yankee(a) |
| |||||||
| Australia & New Zealand Banking Group Ltd., 0.30%, 7/07/11 (b) |
$ | 47,000 | $ | 46,999,966 | ||||
| Bank of Montreal, Chicago: |
||||||||
| 0.35%, 11/22/11 (b) |
300,000 | 300,000,000 | ||||||
| 0.33%, 2/29/12 (b) |
100,000 | 100,000,000 | ||||||
| Bank of Tokyo-Mitsubishi UFJ Ltd., New York, 0.26%, 5/10/11 |
276,000 | 276,000,000 | ||||||
| BNP Paribas S.A., New York, 0.51%, 12/12/11 (b) |
200,000 | 200,000,000 | ||||||
| Canadian Imperial Bank of Commerce, New York, 0.30%, 7/18/11 (b) |
455,000 | 455,000,000 | ||||||
| Credit Agricole Corporate & Investment Bank, New York, 0.41%, 4/08/11 |
195,000 | 195,000,000 | ||||||
| Den Danske Bank, 0.32%, 5/04/11 |
32,000 | 32,000,000 | ||||||
| Deutsche Bank AG, New York: |
||||||||
| 0.30%, 4/06/11 |
225,000 | 225,000,000 | ||||||
| 0.32%, 5/25/11 |
195,000 | 195,000,000 | ||||||
| Dexia Credit Local, New York: |
||||||||
| 0.29%, 4/01/11 |
985,000 | 985,000,000 | ||||||
| 0.65%, 6/29/11 (b) |
157,000 | 157,000,000 | ||||||
| HSBC Bank, 0.55%, 2/22/12 |
175,000 | 175,015,797 | ||||||
| Lloyds TSB Bank Plc, New York: |
||||||||
| 1.26%, 5/06/11 (b) |
75,000 | 75,000,000 | ||||||
| 0.32%, 2/14/12 (b) |
256,640 | 256,640,000 | ||||||
| Mizuho Corporate Bank, New York: |
||||||||
| 0.30%, 4/14/11 |
325,000 | 325,000,000 | ||||||
| 0.28%, 4/26/11 |
130,000 | 130,000,000 | ||||||
| 0.25%, 5/10/11 |
300,000 | 299,996,751 | ||||||
| Royal Bank of Canada, New York, 0.31%, 10/14/11 (b) |
170,000 | 170,000,000 | ||||||
| Royal Bank of Scotland Plc, Connecticut: |
||||||||
| 0.49%, 4/19/11 |
200,000 | 200,000,000 | ||||||
| 0.52%, 9/19/11 |
460,000 | 460,000,000 | ||||||
| Societe Generale, New York, 1.71%, 5/05/11 (b) |
110,000 | 110,000,000 | ||||||
| Sumitomo Mitsui Banking Corp., New York: |
||||||||
| 0.27%, 5/09/11 |
500,000 | 499,997,362 | ||||||
| 0.38%, 6/03/11 |
147,000 | 147,002,519 | ||||||
| Toronto Dominion Bank, New York, 0.25%, 6/08/11 |
25,000 | 25,000,000 | ||||||
| UBS AG, Connecticut, 0.36%, 8/11/11 (b) |
315,000 | 315,000,000 | ||||||
| Westpac Banking Corp., New York, 0.36%, 4/04/12 (b) |
74,000 | 74,000,439 | ||||||
| Total Certificates of Deposit — 28.4% |
6,429,652,834 | |||||||
| Commercial Paper |
||||||||
| Argento Variable Funding Co. Ltd.: |
||||||||
| 0.30%, 6/20/11 (c) |
100,000 | 99,933,333 | ||||||
| 0.46%, 9/12/11 (c) |
177,000 | 176,629,087 | ||||||
| ASB Finance Ltd., London, 0.31%, 8/02/11 (b)(c) |
94,000 | 94,000,000 | ||||||
| Atlantic Asset Securitization LLC, 0.27%, 6/07/11 (c) |
72,000 | 71,963,820 | ||||||
| Atlantis One Funding, 0.25%, 6/21/11 (c) |
85,000 | 84,952,188 | ||||||
| Bank of America Corp., 0.24%, 5/04/11 |
174,500 | 174,461,610 | ||||||
| Barton Capital Corp., 0.23%, 5/19/11 (c) |
62,533 | 62,513,823 | ||||||
| BNZ International Funding Ltd.: |
||||||||
| 0.36%, 8/02/11 (c)(d) |
145,000 | 144,821,650 | ||||||
| 0.40%, 11/10/11 (b)(c) |
50,000 | 50,003,101 | ||||||
| 0.43%, 1/06/12 (b)(c) |
100,000 | 100,007,487 | ||||||
| 0.42%, 1/13/12 (b)(c) |
135,000 | 135,010,390 | ||||||
| 0.42%, 1/20/12 (b)(c) |
45,500 | 45,503,578 | ||||||
| 0.43%, 2/02/12 (b)(c) |
150,000 | 150,012,827 | ||||||
| 0.42%, 2/14/12 (b)(c) |
150,000 | 150,013,520 | ||||||
| BPCE S.A.: |
||||||||
| 0.40%, 6/16/11 (c) |
146,000 | 145,878,031 | ||||||
| 0.30%, 6/21/11 (c) |
47,000 | 46,968,275 | ||||||
| 0.43%, 7/05/11 (c) |
245,000 | 244,721,993 | ||||||
| Cancara Asset Securitization Ltd., 0.25%, 4/26/11 (c) |
19,000 | 18,996,701 | ||||||
| Citigroup Funding, Inc., 0.20%, 4/21/11 |
177,000 | 176,980,333 | ||||||
| Credit Agricole North America Inc., 0.24%, 6/01/11 |
270,000 | 269,892,487 | ||||||
| Credit Suisse, New York, 0.26%, 6/30/11 (d) |
175,000 | 174,886,250 | ||||||
| Danske Corp.: |
||||||||
| 0.31%, 4/01/11 (c) |
94,200 | 94,200,000 | ||||||
| 0.30%, 4/04/11 (c) |
120,500 | 120,496,988 | ||||||
| 0.31%, 4/11/11 (c) |
310,000 | 309,973,306 | ||||||
| Deutsche Bank Financial LLC, 0.27%, 6/01/11 |
500,000 | 499,771,250 | ||||||
| Govco LLC, 0.27%, 5/31/11 (c) |
95,000 | 94,957,250 | ||||||
| Grampian Funding LLC: |
||||||||
| 0.32%, 6/07/11 (c) |
180,000 | 179,892,800 | ||||||
| 0.46%, 9/09/11 (c) |
100,000 | 99,794,278 | ||||||
| 0.00%, 9/19/11 (c) |
95,000 | 94,796,938 | ||||||
| ING US Funding LLC, 0.43%, 4/06/11 (d) |
250,000 | 249,985,069 | ||||||
| Kells Funding LLC: |
||||||||
| 0.34%, 4/18/11 (c) |
53,575 | 53,566,398 | ||||||
| 0.34%, 5/20/11 (c) |
100,000 | 99,953,722 | ||||||
| 0.37%, 6/03/11 (c) |
250,000 | 249,838,125 | ||||||
| 0.30%, 6/27/11 (c) |
100,000 | 99,927,500 | ||||||
| 0.30%, 6/28/11 (c) |
155,000 | 154,886,333 | ||||||
| 0.37%, 12/12/11 (b)(c) |
216,000 | 216,001,247 | ||||||
| 0.36%, 12/21/11 (b)(c) |
140,000 | 140,000,000 | ||||||
| Lloyds TSB Bank Plc, 0.27%, 6/17/11 |
29,000 | 28,983,253 | ||||||
| National Bank of Canada, New York, 0.24%, 5/16/11 |
500,000 | 499,850,000 | ||||||
| Nationwide Building Society: |
||||||||
| 0.36%, 7/21/11 (c) |
191,000 | 190,787,990 | ||||||
| 0.36%, 7/27/11 (c) |
80,000 | 79,906,400 | ||||||
| Nordea North America Inc., 0.22%, 4/18/11 |
150,000 | 149,984,063 | ||||||
| Northern Pines Funding LLC, 0.31%, 6/22/11 (c) |
195,000 | 194,862,308 | ||||||
| NRW.BANK: |
||||||||
| 0.28%, 5/02/11 |
15,000 | 14,996,383 | ||||||
| 0.30%, 5/24/11 |
200,000 | 199,911,667 | ||||||
| Old Line Funding LLC, 0.23%, 5/23/11 (c) |
50,000 | 49,983,389 | ||||||
| Royal Park Investment Funding Corp., 0.52%, 4/01/11 (c) |
25,000 | 25,000,000 | ||||||
| Scaldis Capital LLC, 0.34%, 6/21/11 (c) |
88,000 | 87,932,680 | ||||||
| Societe Generale North America Inc., 0.29%, 5/02/11 |
21,000 | 20,994,756 | ||||||
| UBS Finance Delaware LLC, 0.27%, 5/24/11 |
32,925 | 32,911,912 | ||||||
| Westpac Securities NZ Ltd., 0.38%, 10/03/11 (b)(c) |
486,000 | 486,000,000 | ||||||
| Total Commercial Paper — 32.8% |
7,438,296,489 | |||||||
| Time Deposits |
||||||||
| DNB Nor Bank ASA, 0.01%, 4/01/11 |
584,000 | 584,000,000 | ||||||
| HSBC Bank, 0.53%, 2/28/12 |
200,000 | 200,018,403 | ||||||
| Natixis, 0.11%, 4/01/11 |
675,000 | 675,000,000 | ||||||
| Total Time Deposits — 6.4% |
1,459,018,403 | |||||||
| U.S. Government Sponsored Agency Obligations |
||||||||
| Fannie Mae Variable Rate Notes: |
||||||||
| 0.27%, 8/23/12 (b) |
200,000 | 200,056,905 | ||||||
| 0.30%, 1/10/13 (b) |
250,000 | 249,910,325 | ||||||
| Federal Farm Credit Bank Variable Rate Notes: |
||||||||
| 0.24%, 5/26/11 (b) |
62,225 | 62,224,047 | ||||||
| 0.23%, 4/27/12 (b) |
144,460 | 144,436,287 | ||||||
| 0.25%, 7/09/12 (b) |
159,000 | 159,000,000 | ||||||
| 0.32%, 7/13/12 (b) |
58,020 | 58,012,462 | ||||||
| 0.28%, 7/23/12 (b) |
44,000 | 44,017,464 | ||||||
| 0.28%, 10/12/12 (b) |
75,000 | 75,000,000 | ||||||
| Federal Home Loan Bank Variable Rate Notes, 0.24%, 10/06/11 (b) |
187,000 | 186,960,854 | ||||||
| Freddie Mac Discount Notes: |
||||||||
| 0.20%, 4/18/11 (d) |
233,000 | 232,977,995 | ||||||
| 0.20%, 4/21/11 (d) |
100,000 | 99,988,889 | ||||||
| 0.21%, 5/10/11 (d) |
200,000 | 199,954,500 | ||||||
| 0.26%, 6/21/11 (d) |
200,000 | 199,883,000 | ||||||
| 0.20%, 8/17/11 (d) |
300,000 | 299,770,000 | ||||||
| Freddie Mac Variable Rate Notes: |
||||||||
| 0.12%, 11/09/11 (b) |
606,000 | 605,738,354 | ||||||
| 0.13%, 1/13/12 (b) |
302,995 | 302,850,504 | ||||||
| Schedule of Investments (continued) | Money Market Master Portfolio | |
| (Percentages shown are based on Net Assets) |
| 0.21%, 2/16/12 (b) |
110,000 | 109,961,014 | ||||||
| Total U.S. Government Sponsored Agency Obligations — 14.3% |
3,230,742,600 | |||||||
| U.S. Treasury Obligations(d) |
||||||||
| U.S. Treasury Note: |
||||||||
| 4.88%, 4/30/11 |
100,000 | 100,376,692 | ||||||
| 0.88%, 5/31/11 |
175,000 | 175,200,835 | ||||||
| 1.00%, 10/31/11 |
390,000 | 391,715,757 | ||||||
| Total U.S. Treasury Obligations — 3.0% |
667,293,284 | |||||||
| Repurchase Agreements |
||||||||
| Banc of America Securities LLC, 0.22%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $500,003,056, collateralized by non-U.S. government debt securities, 0.00% to 11.25%, 5/15/11 to 12/10/49, par and fair value of $522,135,324 and $525,000,001, respectively) |
500,000 | 500,000,000 | ||||||
| Banc of America Securities LLC, 0.47%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $500,006,528, collateralized by non-U.S. government debt securities, 0.00% to 8.62%, 1/15/14 to 6/25/50, par and fair value of $1,408,845,159 and $535,000,000, respectively) |
500,000 | 500,000,000 | ||||||
| BNP Paribas Securities Corp., 0.24%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $425,002,833, collateralized by non-U.S. government debt securities, 3.75% to 11.00%, 5/20/11 to 10/14/19, par and fair value of $385,835,352 and $437,750,000, respectively) |
425,000 | 425,000,000 | ||||||
| Citigroup Global Markets Inc., 0.32%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $69,000,613, collateralized by non-U.S. government debt securities, 0.00%, 1/20/21, par and fair value of $79,692,570 and $75,900,001, respectively) |
69,000 | 69,000,000 | ||||||
| Citigroup Global Markets Inc., 0.55%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $250,003,793, collateralized by non-U.S. government debt securities and U.S. government obligations, 0.00% to 7.55%, 7/6/11 to 2/1/41, par and fair value of $402,987,338 and $278,736,821, respectively) |
250,000 | 250,000,000 | ||||||
| Citigroup Global Markets Inc., 0.62%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $190,003,272, collateralized by non-U.S. government debt securities, 0.00% to 8.00%, 7/1/11 to 4/1/57, par and fair value of $277,924,190 and $241,757,578, respectively) |
190,000 | 190,000,000 | ||||||
| Citigroup Global Markets Inc., 0.76%, 6/1/11 (Purchased on 3/31/11 to be repurchased at $80,104,711, collateralized by U.S. government obligations, 0.76% to 5.50%, 8/15/34 to 4/15/40, par and fair value of $136,267,857 and $82,400,001, respectively) |
80,000 | 80,000,000 | ||||||
| Deutsche Bank Securities Inc., 0.15%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $47,100,196, collateralized by U.S. government obligations, 0.63% to 1.00%, 2/28/13 to 1/20/26, par and fair value of $48,063,600 and $48,042,073, respectively) |
47,100 | 47,100,000 | ||||||
| Federal Reserve Bank of New York, 0.10%, 4/4/11 (Purchased on 3/31/11 to be repurchased at $10,000,111, collateralized by U.S. Treasury obligations, 1.00%, 7/31/11, par and fair value of $9,956,200 and $10,000,434, respectively) |
10,000 | 10,000,000 | ||||||
| Federal Reserve Bank of New York, 0.10%, 4/5/11 (Purchased on 3/31/11 to be repurchased at $10,000,139, collateralized by U.S. Treasury obligations, 4.88%, 4/30/11, par and fair value of $9,763,400 and $10,000,113, respectively) |
10,000 | 10,000,000 | ||||||
| Federal Reserve Bank of New York, 0.12%, 4/4/11 (Purchased on 3/31/11 to be repurchased at $10,000,133, collateralized by U.S. Treasury obligations, 4.88%, 4/30/11, par and fair value of $9,763,400 and $10,000,113, respectively) |
10,000 | 10,000,000 | ||||||
| Federal Reserve Bank of New York, 0.13%, 4/5/11 (Purchased on 3/31/11 to be repurchased at $10,000,181, collateralized by U.S. government obligations, 2.75%, 4/11/11, par and fair value of $9,865,000 and $10,000,408, respectively) |
10,000 | 10,000,000 | ||||||
| Greenwich Capital Markets, 0.27%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $400,003,000, collateralized by non-U.S. government debt securities, 0.66% to 10.18%, 4/26/11 to 4/15/29, par and fair value of $416,690,000 and $440,000,337, respectively) |
400,000 | 400,000,000 | ||||||
| HSBC Securities (USA) Inc., 0.20%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $100,000,556, collateralized by non-U.S. government debt securities, 0.00% to 8.30%, 8/15/12 to 12/21/57, par and fair value of $101,580,000 and $103,051,395, respectively) |
100,000 | 100,000,000 | ||||||
| JPMorgan Securities Inc., 0.16%, 4/5/11 (Purchased on 3/31/11 to be repurchased at $10,000,222, collateralized by U.S. Treasury obligations and non-U.S. government debt securities, 3.00% to 4.25%, 4/22/14 to 2/15/21, par and fair value of $10,006,250 and $10,200,741, respectively) |
10,000 | 10,000,000 | ||||||
| JPMorgan Securities Inc., 0.29%, 4/7/11 (Purchased on 3/31/11 to be repurchased at $50,002,819, collateralized by non-U.S. government debt securities, 0.42% to 5.72%, 4/1/18 to 12/22/23, par and fair value of $68,062,000 and $52,502,220, respectively) |
50,000 | 50,000,000 | ||||||
| JPMorgan Securities Inc., 0.47%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $320,004,178, collateralized by non-U.S. government debt securities, 0.00% to 9.25%, 1/15/17 to 1/15/49, par and fair value of $630,180,177 and $336,001,053, respectively) |
320,000 | 320,000,000 | ||||||
| Merrill Lynch & Co. Inc., 0.27%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $100,000,750, collateralized by non-U.S. government debt securities, 0.00%, 4/20/11 to 7/8/11, par and fair value of $102,051,390 and $102,000,001, respectively) |
100,000 | 100,000,000 | ||||||
| Morgan Stanley & Co. Inc., 0.11%, 4/1/11 (Purchased on 3/31/11 to be repurchased at $271,165,829, collateralized by U.S. Treasury obligations, 2.25% to 7.25%, 9/30/11 to 8/15/22, par and fair value of $251,359,200 and $276,588,330, respectively) |
271,165 | 271,165,000 | ||||||
| RBS Securities Inc., 0.47%, 4/1/11 (Purchased on 3/31/11 to be repurchased on $75,000,979, collateralized by non-U.S. government debt securities, 0.32% to 7.20%, 2/18/14 to 2/12/51, par and fair value of $159,556,000 and $82,505,411, respectively) |
75,000 | 75,000,000 | ||||||
| Total Repurchase Agreements — 15.1% |
3,427,265,000 | |||||||
| Total Investments (Cost — $ 22,652,268,610*) — 100.0 % |
22,652,268,610 | |||||||
| Other Assets in Excess of Liabilities — 0.0% |
7,371,670 | |||||||
| Net Assets — 100.0% |
$ | 22,659,640,280 | ||||||
| * | Cost for federal income tax purposes. |
| (a) | Issuer is a U.S. branch of a foreign domiciled bank. |
| (b) | Variable rate security. Rate shown is as of report date. |
| (c) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors. |
| (d) | Rate shown reflects the discount rate at the time of purchase. |
| • | Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs are summarized in three broad levels for financial reporting purposes as follows: |
| • | Level 1 – price quotations in active markets/exchanges for identical assets and liabilities |
| • | Level 2 – other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs) |
| • | Level 3 – unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Master Portfolio’s own assumptions used in determining the fair value of investments) |
| Schedule of Investments (concluded) | Money Market Master Portfolio | |
| (Percentages shown are based on Net Assets) |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Master Portfolio’s policy regarding valuation of investments and other significant accounting policies, please refer to the Master Portfolio’s most recent financial statements as contained in its annual report. The following table summarizes the inputs used as of March 31, 2011 in determining the fair valuation of the Master Portfolio’s investments:
| Valuation Inputs |
Level 1 |
Level 2 |
Level 3 |
Total |
||||||||||||
| Assets: |
||||||||||||||||
| Investments in Securities: |
||||||||||||||||
| Short-Term Securities1 |
— | $ | 22,652,268,610 | — | $ | 22,652,268,610 | ||||||||||
| 1 | See above Schedule of Investments for values in each security type. |
| Item 2. | Controls and Procedures. |
(a) The Registrant’s Principal Executive Officer and Chief Financial Officer have concluded that, based on their evaluation as of a date within 90 days of the filing date of this report, the disclosure controls and procedures of the Registrant (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are reasonably designed to achieve the purposes described in the attached certification, Section 4(a).
(b) There were no changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.
| Item 3. | Exhibits. |
(a) Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are attached hereto as Exhibits 3(a)(1) and 3(a)(2).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) PayPal Funds
| By: | /s/ Dana S. Schmidt | |
| Dana E. Schmidt | ||
| President and Principal Executive Officer | ||
| Date: | May 19, 2011 | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities, and on the dates indicated.
| By: | /s/ Dana S. Schmidt | |
| Dana E. Schmidt | ||
| President and Principal Executive Officer | ||
| Date: | May 19, 2011 | |
| By: | /s/ Omar J. Paz | |
| Omar J. Paz | ||
| Treasurer and Chief Financial Officer | ||
| Date: | May 19, 2011 | |
Exhibit 3(a)(1)
CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002:
I, Dana E. Schmidt, President and Principal Executive Officer of PayPal Funds, certify that:
1. I have reviewed this report on Form N-Q of PayPal Funds (the “registrant”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the schedule of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| By: | /s/ Dana E. Schmidt | |
| Dana E. Schmidt | ||
| President and Principal Executive Officer | ||
| Date: | May 19, 2011 | |
Exhibit 3(a)(2)
CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002:
I, Omar J. Paz, Treasurer and Chief Financial Officer of PayPal Funds, certify that:
1. I have reviewed this report on Form N-Q of PayPal Funds (the “registrant”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the schedule of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have:
(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| By: | /s/ Omar J. Paz | |
| Omar J. Paz | ||
| Treasurer and Chief Financial Officer | ||
| Date: | May 19, 2011 | |