N-Q

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   811-10261

Pearl Mutual Funds

(Exact name of registrant as specified in charter)

2610 Park Avenue, PO Box 209, Muscatine, IA 52761

(Address of principal executive offices)

Robert H. Solt, President

2610 Park Avenue, Muscatine, IA 52761

(Name and address of agent for service)

Registrant's telephone number, including area code:   563-288-2773

Date of fiscal year end:  December 31

Date of reporting period:  September 30, 2010

Item 1. Schedule of Investments.

Pearl Total Return Fund Holdings as of 09/30/2010 (unaudited)*
Cusip	Equity Funds:	% Total Assets	Shares	Market Value
304871106	Fairholme Fund (FAIRX)	14.84%	356,953.190	$11,693,786.50
413838202	Oakmark International (OAKIX)	11.24%	487,226.788	$8,857,783.01
885215327	Thornburg Global Opportunities (THOIX)	11.01%	619,196.069	$8,674,936.93
577130867	Matthews Asia Pacific (MPACX)	9.34%	432,951.366	$7,360,173.22
26200C403	Dreyfus Opportunistic Small Cap (DSCVX)	8.79%	273,957.117	$6,928,375.49
94904P708	Weitz Partners III Opportunity (WPOPX)	8.13%	613,762.237	$6,407,677.75
572353522	Marshall Small Cap Growth (MSGIX)	7.94%	384,935.290	$6,255,198.46
577125107	Matthews Asia Dividend (MAPIX)	6.01%	340,732.033	$4,736,175.26
577130206	Matthews Asian Growth & Income (MACSX)	3.82%	169,576.972	$3,008,295.48
41013P608	John Hancock Large Cap Equity (JLVIX)	2.06%	66,124.598	$1,626,665.11
779557107	T. Rowe Price New America Growth (PRWAX)	1.83%	49,280.025	$1,444,397.53
	Equity Funds Subtotal	85.01%		$66,993,464.74
	Income Funds:
693390700	PIMCo Total Return (PTTRX)	1.19%	81,016.377	$939,789.97
	Cash and Money Markets:
922906201	Vanguard Prime Money Market Fund (VMMXX)	0.06%	47,531.700	$47,531.70
	Cash held with Custodian	13.74%	10,839,400.120	$10,839,400.12
	Portfolio Total	100.00%		$78,820,186.53

Pearl Aggressive Growth Fund Holdings as of  09/30/2010 (unaudited)*
Cusip	Equity Funds:	% Total Assets	Shares	Market Value
41013P764	John Hancock Global Opportunities I (JGPIX)	19.53%	469,953.780	$8,567,257.41
577130107	Matthews Pacific Tiger (MAPTX)	18.15%	345,165.047	$7,962,957.63
52106N889	Lazard Emerging Markets Fund (LZEMX)	14.33%	300,256.759	$6,284,373.97
316389873	Fidelity Leveraged Company Stock Fund (FLVCX)	14.16%	259,500.876	$6,212,450.97
90330L402	US Global Eastern European (EUROX)	13.78%	612,335.79	$6,043,754.25
093001485	William Blair Small Cap Growth (WBSIX)	8.67%	180,799.684	$3,804,025.35
47103E775	Janus Overseas (JNOSX)	5.77%	53,204.013	$2,532,511.02
44134R867	Hotchkis and Wiley Small Cap Value	4.91%	62,853.551	$2,155,248.26
	Equity Funds Subtotal	99.30%		$43,562,578.86
	Cash and Money Markets:
922906201	Vanguard Prime Money Market Fund (VMMXX)	0.02%	9,793.950	$9,793.95
	Cash held with Custodian	0.68%	293,711.890	$293,711.89
	Portfolio Total	100.00%		$43,866,084.70

* The Funds adopted Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures, (formerly Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, Fair Value Measurements), effective January 1, 2008. In accordance with ASC 820, fair value is defined as the price that the Funds would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market of the investment.  ASC 820 established a three-tier hierarchy to maximize the use of the observable market data and minimize the use of unobservable inputs and to establish classification of the fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including the technique or pricing model used to measure fair value and the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability, developed based on market data obtained from sources independent of the reporting entity.

Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability, developed based on the best information available in the circumstances. 

●	Level 1 — quoted prices in active markets for identical investments.
●	Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds,
credit risks, etc.).

● Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments.

The valuation techniques used by the Funds to measure fair value during the quarter ended September 30, 2010 maximized the use of observable inputs and minimized the use of unobservable inputs.

The following is a summary of the inputs used as of September 30, 2010 in valuing the Funds’ investments carried at fair value:

Valuation Inputs	Pearl Total Return Fund	Pearl Aggressive Growth Fund
Level 1— Quoted Prices:	$78,820,186.53	$43,866,084.70
Level 2 — Other Significant Observable Inputs:	—	—
Level 3 — Significant Unobservable Inputs:	—	—
Total	$78,820,186.53	$43,866,084.70

Item 2. Controls and Procedures.

(a) Based on an evaluation of the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”), the “Disclosure Controls”) as of a date within 90 days prior to the filing date (the “Filing Date”) of this Form N-Q (the “Report”), the Disclosure Controls are effectively designed to ensure that information required to be disclosed by the registrant in the Report is recorded, processed, summarized and reported by the appropriate Filing Date and that information required to be disclosed in the Report is accumulated and communicated to the registrant's management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) 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) Certification pursuant to Rule 30a-2(a) under the 1940 Act, attached hereto as Exhibit (a)(1).  

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the 1940 Act, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Pearl Mutual Funds
By:	/s/ David M. Stanley
	David M. Stanley
	Secretary
Date:	November 24, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934 and the 1940 Act, this Report has been signed below by the following person on behalf of the registrant and in the capacities, and on the date indicated.

By:	/s/ Robert H. Solt
	Robert H. Solt
	President, Chief Executive Officer, Chief Operating Officer, Chief Financial Officer and Treasurer
Date:	November 24, 2010

EX-99.CERT

I, Robert H. Solt, President, Chief Executive Officer, Chief Operating Officer, Chief Financial Officer and Treasurer of Pearl Mutual Funds (the “Registrant”), certify that:

1.           I have reviewed this report on Form N-Q of 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 schedules 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.           I am 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 my supervision, to ensure that material information relating to the Registrant, which has no consolidated subsidiaries, is made known to me by others within the Registrant, 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 my 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 my 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;

5.           I have disclosed to the Registrant’s auditors and the audit committee of the Registrant’s board of trustees:

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.

Dated:  November 24, 2010

/s/ Robert H. Solt

Robert H. Solt

President, Chief Executive Officer, Chief Operating Officer,

Chief Financial Officer and Treasurer