UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act File Number 811-58433

Marshall Funds, Inc.

(Exact name of registrant as specified in charter)

111 East Kilbourn Avenue

Milwaukee, WI 53202

(Address of principal executive offices) (Zip code)

John M. Blaser

M&I Investment Management Corp.

111 East Kilbourn Avenue

Milwaukee, WI 53202

(Name and address of agent for service)

Registrant’s telephone number, including area code: (800) 236-3863

Date of fiscal year end: August 31

Date of reporting period: February 29, 2008

Item 1. Reports to Stockholders

Table of Contents

Financial Information
Expense Example	1
Schedule of Investments	3
Marshall Large-Cap Value Fund	3
Marshall Large-Cap Growth Fund	5
Marshall Mid-Cap Value Fund	7
Marshall Mid-Cap Growth Fund	9
Marshall Small-Cap Growth Fund	11
Marshall International Stock Fund	13
Marshall Aggregate Bond Fund	17
Marshall Government Income Fund	19
Marshall Intermediate Tax-Free Fund	22
Marshall Short-Intermediate Bond Fund	28
Marshall Short-Term Income Fund	31
Marshall Prime Money Market Fund	33
Marshall Government Money Market Fund	37
Marshall Tax-Free Money Market Fund	37
Notes to Schedule of Investments	43
Statements of Assets and Liabilities	45
Statements of Operations	47
Statements of Changes in Net Assets	49
Financial Highlights	53
Notes to Financial Statements	60

Not FDIC Insured No Bank Guarantee May Lose Value

Expense Example (Unaudited)

For the Six Months Ended February 29, 2008

As a shareholder of a Fund, you may incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six month period ended February 29, 2008 (9/1/07-2/29/08).

Actual Expenses

The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Advisor								Investor								Institutional
Fund	Beginning account value 9/1/07		Ending account value 2/29/08		Annualized Expense Ratio		Expenses paid during period 9/1/07- 2/29/08 (1)		Beginning account value 9/1/07		Ending account value 2/29/08		Annualized Expense Ratio		Expenses paid during period 9/1/07- 2/29/08 (1)		Beginning account value 9/1/07		Ending account value 2/29/08		Annualized Expense Ratio		Expenses paid during period 9/1/07- 2/29/08 (1)
Large-Cap Value
Actual	$	1,000.00	$	930.70	1.24	%	$	5.93	$	1,000.00	$	930.70	1.24	%	$	5.93	$	1,000.00	$	970.70	1.04	%	$	0.81	(2)
Hypothetical (5% return before expenses)		1,000.00		1,018.85	1.24			6.20		1,000.00		1,018.86	1.24			6.20		1,000.00		1,024.18	1.04			0.83	(2)
Large-Cap Growth
Actual		1,000.00		932.30	1.26			6.08		1,000.00		932.30	1.26			6.07		1,000.00		985.80	1.05			0.83	(2)
Hypothetical (5% return before expenses)		1,000.00		1,018.71	1.26			6.35		1,000.00		1,018.71	1.26			6.35		1,000.00		1,024.17	1.05			0.84	(2)
Mid-Cap Value
Actual		1,000.00		900.90	1.23			5.81		1,000.00		900.90	1.23			5.81		1,000.00		972.10	1.00			0.78	(2)
Hypothetical (5% return before expenses)		1,000.00		1,018.89	1.23			6.17		1,000.00		1,018.89	1.23			6.17		1,000.00		1,024.21	1.00			0.80	(2)
Mid-Cap Growth
Actual		1,000.00		989.10	1.26			6.23		1,000.00		989.10	1.26			6.23		1,000.00		1,011.10	1.06			0.84	(2)
Hypothetical (5% return before expenses)		1,000.00		1,018.74	1.26			6.32		1,000.00		1,018.74	1.26			6.32		1,000.00		1,024.16	1.06			0.85	(2)

(See Notes which are an integral part of the Financial Statements)

1

Expense Example (Unaudited) (continued)

	Advisor								Investor								Institutional
Fund	Beginning account value 9/1/07		Ending account value 2/29/08		Annualized Expense Ratio		Expenses paid during period 9/1/07- 2/29/08 (1)		Beginning account value 9/1/07		Ending account value 2/29/08		Annualized Expense Ratio		Expenses paid during period 9/1/07- 2/29/08 (1)		Beginning account value 9/1/07		Ending account value 2/29/08		Annualized Expense Ratio		Expenses paid during period 9/1/07- 2/29/08 (1)
Small-Cap Growth
Actual	$	1,000.00	$	915.30	1.51	%	$	7.21	$	1,000.00	$	915.30	1.51	%	$	7.19	$	1,000.00	$	983.70	1.32	%	$	1.04	(2)
Hypothetical (5% return before expenses)		1,000.00		1,017.47	1.51			7.60		1,000.00		1,017.49	1.51			7.57		1,000.00		1,023.95	1.32			1.06	(2)
International Stock
Actual		1,000.00		910.60	1.47			6.98		1,000.00		910.60	1.47			6.98		1,000.00		914.40	1.22			5.80
Hypothetical (5% return before expenses)		1,000.00		1,017.70	1.47			7.37		1,000.00		1,017.70	1.47			7.37		1,000.00		1,018.94	1.22			6.12
Aggregate Bond
Actual		1,000.00		1,041.90	0.80			4.04		1,000.00		1,040.80	0.80			4.05		1,000.00		1,042.10	0.55			2.79
Hypothetical (5% return before expenses)		1,000.00		1,021.05	0.80			3.99		1,000.00		1,021.03	0.80			4.01		1,000.00		1,022.27	0.55			2.76
Government Income
Actual		1,000.00		1,037.60	0.80			4.05		1,000.00		1,038.70	0.80			4.06		1,000.00		1,038.90	0.55			2.79
Hypothetical (5% return before expenses)		1,000.00		1,021.02	0.80			4.02		1,000.00		1,021.02	0.80			4.02		1,000.00		1,022.27	0.55			2.76
Intermediate Tax-Free
Actual		—		—	—			—		1,000.00		1,014.10	0.55			2.75		—		—	—			—
Hypothetical (5% return before expenses)		—		—	—			—		1,000.00		1,022.27	0.55			2.76		—		—	—			—
Short-Intermediate Bond
Actual		1,000.00		1,029.10	0.80			4.04		1,000.00		1,030.20	0.80			4.05		1,000.00		1,030.40	0.55			2.78
Hypothetical (5% return before expenses)		1,000.00		1,021.02	0.80			4.02		1,000.00		1,021.01	0.80			4.03		1,000.00		1,022.26	0.55			2.77
Short-Term Income
Actual		1,000.00		1,040.80	0.60			3.05		1,000.00		1,039.60	0.60			3.05		1,000.00		1,042.00	0.35			1.78
Hypothetical (5% return before expenses)		1,000.00		1,022.02	0.60			3.02		1,000.00		1,022.01	0.60			3.02		1,000.00		1,023.26	0.35			1.76
Prime Money Market
Actual		1,000.00		1,021.30	0.75			3.76		1,000.00		1,022.90	0.45			2.26		1,000.00		1,024.10	0.20			1.00
Hypothetical (5% return before expenses)		1,000.00		1,021.28	0.75			3.76		1,000.00		1,022.77	0.45			2.26		1,000.00		1,024.01	0.20			1.00
Government Money Market
Actual		—		—	—			—		1,000.00		1,021.10	0.45			2.26		1,000.00		1,022.40	0.20			1.00
Hypothetical (5% return before expenses)		—		—	—			—		1,000.00		1,022.76	0.45			2.27		1,000.00		1,024.01	0.20			1.01
Tax-Free Money Market
Actual		—		—	—			—		1,000.00		1,015.40	0.45			2.26		1,000.00		1,016.70	0.20			1.00
Hypothetical (5% return before expenses)		—		—	—			—		1,000.00		1,022.76	0.45			2.26		1,000.00		1,024.01	0.20			1.00

(1) Expenses are equal to the Funds’ expense ratios multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).

(2) The Fund classes commenced operations on 2/1/08. The Funds’ expense ratios are multiplied by 29/366 (to reflect the partial period).

(See Notes which are an integral part of the Financial Statements)

2

February 29, 2008 (Unaudited)

Schedule of Investments

Large-Cap Value Fund

Description	Shares	Value
Common Stocks — 97.2%
Consumer Discretionary — 4.9%
Apparel Retail — 1.0%
TJX Companies, Inc.	91,400	$    2,924,800
Computer & Electronics Retail — 0.9%
Best Buy Co., Inc.	63,950	2,750,490
Footwear — 1.0%
NIKE, Inc., Class B	49,200	2,961,839
Housewares & Specialties — 0.6%
Newell Rubbermaid, Inc.	84,100	1,909,070
Movies & Entertainment — 1.4%
News Corp.	111,100	2,045,351
Time Warner, Inc.	123,150	1,922,372
		3,967,723
Total Consumer Discretionary		14,513,922
Consumer Staples — 11.3%
Drug Retail — 1.1%
CVS Caremark Corp.	85,000	3,432,300
Food Retail — 0.7%
Kroger Co.	89,800	2,177,650
Household Products — 3.4%
Colgate-Palmolive Co.	47,300	3,599,057
Procter & Gamble Co.	98,300	6,505,494
		10,104,551
Soft Drinks — 3.1%
Coca-Cola Co.	121,000	7,073,660
PepsiCo, Inc.	29,900	2,079,844
		9,153,504
Tobacco — 3.0%
Altria Group, Inc.	74,100	5,419,674
Reynolds American, Inc.	16,200	1,032,264
UST, Inc.	45,600	2,475,624
		8,927,562
Total Consumer Staples		33,795,567
Energy — 16.1%
Integrated Oil & Gas — 11.5%
Chevron Corp.	127,400	11,040,483
ConocoPhillips	121,170	10,021,971
Exxon Mobil Corp.	83,050	7,226,181
Hess Corp.	26,200	2,441,316
Marathon Oil Corp.	70,050	3,723,858
		34,453,809
Oil & Gas-Equipment and Services — 0.6%
Halliburton Co.	43,000	1,646,900
Oil & Gas-Exploration and Production — 3.1%
Apache Corp.	41,600	4,771,936
Devon Energy Corp.	43,500	4,468,320
		9,240,256
Oil & Gas-Refining and Marketing — 0.9%
Valero Energy Corp.	48,100	2,778,737
Total Energy		48,119,702
Financials — 19.8%
Asset Management & Custody Banks — 0.9%
Ameriprise Financial, Inc.	55,500	2,810,520

Description	Shares	Value
Common Stocks (continued)
Financials (continued)
Diversified Banks — 3.2%
U.S. Bancorp (1)	101,000	$    3,234,020
Wells Fargo & Co. (1)	220,200	6,436,446
		9,670,466
Investment Banking & Brokerage — 4.7%
Goldman Sachs Group, Inc.	26,355	4,470,599
Lehman Brothers Holdings, Inc. (1)	76,495	3,900,480
Merrill Lynch & Co., Inc. (1)	37,200	1,843,632
Morgan Stanley	88,000	3,706,560
		13,921,271
Multi-Line Insurance — 2.1%
American International Group, Inc.	131,800	6,176,148
Other Diversified Financial Services — 3.1%
Bank of America Corp.	94,890	3,770,929
JP Morgan Chase & Co.	135,120	5,492,628
		9,263,557
Property & Casualty Insurance — 4.6%
Chubb Corp.	84,000	4,275,600
Travelers Co., Inc.	167,500	7,773,674
W.R. Berkley Corp.	68,350	1,967,797
		14,017,071
Real Estate Investment Trusts — 0.7%
ProLogis	37,300	2,009,724
Regional Banks — 0.5%
PNC Financial Services Group	23,500	1,443,605
Total Financials		59,312,362
Healthcare — 8.2%
Biotechnology — 0.8%
Gilead Sciences, Inc. (1)(2)	49,600	2,347,072
Healthcare Distributors — 0.7%
AmerisourceBergen Corp.	50,000	2,086,000
Managed Healthcare — 1.0%
UnitedHealth Group, Inc.	31,700	1,473,416
WellPoint, Inc. (2)	22,700	1,590,816
		3,064,232
Pharmaceuticals — 5.7%
Bristol-Myers Squibb Co. (1)	120,150	2,716,592
Eli Lilly & Co.	61,300	3,066,226
Johnson & Johnson	135,050	8,367,698
Pfizer, Inc.	133,800	2,981,064
		17,131,580
Total Healthcare		24,628,884
Industrials — 14.8%
Aerospace & Defense — 7.2%
Boeing Co.	37,265	3,085,169
General Dynamics Corp.	30,500	2,496,425
Honeywell International, Inc.	51,500	2,963,310
L-3 Communications Holdings, Inc.	25,400	2,699,766
Lockheed Martin Corp.	34,400	3,550,080
Northrop Grumman Corp.	53,200	4,182,052
United Technologies Corp.	37,100	2,615,921
		21,592,723
Commercial Printing — 0.6%
R.R. Donnelley & Sons Co.	52,800	1,680,624

(See Notes which are an integral part of the Financial Statements)

3

Marshall Funds

Large-Cap Value Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Industrials (continued)
Construction & Engineering — 1.2%
Fluor Corp.	11,100	$    1,545,675
Jacobs Engineering Group, Inc. (2)	25,800	2,071,482
		3,617,157
Construction & Farm Machinery and Heavy Trucks — 1.0%
Cummins, Inc.	32,400	1,632,312
Deere & Co.	15,345	1,307,547
		2,939,859
Electrical Components & Equipment — 1.6%
Emerson Electric Co.	94,900	4,836,104
Environmental & Facilities Services — 0.9%
Republic Services, Inc.	89,150	2,721,750
Industrial Machinery — 2.3%
Eaton Corp.	34,600	2,789,798
Parker Hannifin Corp.	61,800	3,994,134
		6,783,932
Total Industrials		44,172,149
Information Technology — 7.7%
Application Software — 0.5%
AutoDesk, Inc. (2)	46,100	1,433,249
Computer Hardware — 4.4%
Hewlett Packard Co.	176,950	8,452,901
International Business Machines Corp.	41,660	4,743,407
		13,196,308
Computer Storage & Peripherals — 0.7%
Western Digital Corp. (2)	71,750	2,214,923
Data Processing & Outsourced Services — 0.6%
Fiserv, Inc. (2)	31,900	1,678,578
Semiconductors — 0.7%
NVIDIA Corp. (2)	92,850	1,986,062
Systems Software — 0.8%
Microsoft Corp. (1)	92,500	2,517,850
Total Information Technology		23,026,970
Materials — 3.7%
Diversified Chemicals — 0.7%
Dow Chemical Co.	56,200	2,118,178
Diversified Metals & Mining — 1.4%
Freeport-McMoRan Copper & Gold, Inc. (1)	40,301	4,064,759
Industrial Gases — 0.8%
Air Products and Chemicals, Inc.	27,100	2,475,043
Metal & Glass Containers — 0.8%
Ball Corp.	54,900	2,421,090
Total Materials		11,079,070
Telecommunication Services — 5.9%
Integrated Telecommunication Services — 5.9%
AT&T, Inc.	222,800	7,760,124
Verizon Communications, Inc.	270,300	9,817,296
Total Telecommunication Services		17,577,420

Description	Shares or Principal Amount	Value
Common Stocks (continued)
Utilities — 4.8%
Electric Utilities — 3.4%
Entergy Corp.	40,800	$    4,191,792
FirstEnergy Corp. (1)	60,700	4,102,713
Progress Energy, Inc.	41,800	1,751,838
		10,046,343
Gas Utilities — 0.8%
ONEOK, Inc.	53,000	2,468,210
Multi-Utilities — 0.6%
CenterPoint Energy, Inc.	125,500	1,842,340
Total Utilities		14,356,893
Total Common Stocks (identified cost $252,274,883)		290,582,939
Purchased Call Option — 0.1%
Citigroup, Inc., 1/17/2009 (2)	1,176,471	264,706
Total Purchased Call Option (identified cost $1,003,294)		264,706
Short-Term Investments — 11.8%
Collateral Pool Investment for Securities on Loan — 9.8% (See Note 2 of the Financial Statements)		29,413,277
Repurchase Agreement — 2.0%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008 to be repurchased at $5,827,788 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $5,954,134 (at amortized cost)	$5,826,307	5,826,307
Total Short-Term Investments (identified cost $35,239,584)		35,239,584
Total Investments — 109.1% (identified cost $288,517,761)		326,087,229
Other Assets and Liabilities — (9.1)%		(27,135,072	)
Total Net Assets — 100.0%		$298,952,157

Portfolio Sector Allocations*
Sector	Fund
Consumer Discretionary	4.9%
Consumer Staples	11.3
Energy	16.1
Financials	19.8
Healthcare	8.2
Industrials	14.8
Information Technology	7.7
Materials	3.7
Telecommunication Services	5.9
Utilities	4.8
Purchased Call Option	0.1
Other Assets & Liabilities, Net	2.7
Total	100.0%

(See Notes which are an integral part of the Financial Statements)

4

February 29, 2008 (Unaudited)

Schedule of Investments

Large-Cap Growth Fund

Description	Shares	Value
Common Stocks — 95.1%
Consumer Discretionary — 6.4%
Advertising — 1.0%
Omnicom Group, Inc.	51,880	$    2,317,480
Broadcasting & Cable TV — 0.6%
Comcast Corp. (1)	70,900	1,385,386
General Merchandise Stores — 0.7%
Family Dollar Stores, Inc.	87,300	1,671,795
Home Improvement Retail — 0.7%
Lowe’s Companies, Inc. (1)	71,400	1,711,458
Motorcycle Manufacturers — 0.7%
Harley-Davidson, Inc.	48,200	1,791,112
Restaurants — 2.0%
McDonald’s Corp.	93,900	5,080,929
Specialty Stores — 0.7%
Tractor Supply Co. (2)	45,000	1,684,800
Total Consumer Discretionary		15,642,960
Consumer Staples — 11.2%
Drug Retail — 2.2%
CVS Caremark Corp.	130,300	5,261,514
Household Products — 1.6%
Procter & Gamble Co.	60,500	4,003,890
Packaged Foods & Meats — 1.0%
Wm. Wrigley Jr. Co. (1)	42,000	2,514,120
Soft Drinks — 3.8%
Hansen Natural Corp. (1)(2)	89,000	3,693,500
PepsiCo, Inc.	79,000	5,495,240
		9,188,740
Tobacco — 2.6%
Altria Group, Inc.	45,100	3,298,614
UST, Inc.	56,400	3,061,956
		6,360,570
Total Consumer Staples		27,328,834
Energy — 8.4%
Oil & Gas-Drilling — 2.4%
Noble Corp.	31,000	1,523,650
Transocean, Inc.	30,000	4,215,300
		5,738,950
Oil & Gas-Equipment and Services — 5.6%
Cameron International Corp. (1)(2)	40,000	1,699,200
Halliburton Co.	100,000	3,830,000
National-Oilwell Varco, Inc. (1)(2)	46,500	2,896,950
Schlumberger, Ltd.	60,000	5,187,000
		13,613,150
Oil & Gas-Exploration and Production — 0.4%
XTO Energy, Inc. (1)	16,500	1,018,215
Total Energy		20,370,315
Financials — 7.3%
Asset Management & Custody Banks — 1.1%
State Street Corp.	35,000	2,749,250
Investment Banking & Brokerage — 2.3%
Goldman Sachs Group, Inc.	15,100	2,561,413
The Charles Schwab Corp.	150,000	2,941,500
		5,502,913

Description	Shares	Value
Common Stocks (continued)
Financials (continued)
Life & Health Insurance — 0.5%
Prudential Financial, Inc.	16,000	$    1,167,520
Multi-Line Insurance — 0.9%
Assurant, Inc.	35,000	2,189,250
Specialized Finance — 2.5%
CME Group, Inc. (1)	6,900	3,541,770
NYSE Euronext (1)	40,000	2,626,800
		6,168,570
Total Financials		17,777,503
Healthcare — 17.4%
Biotechnology — 3.0%
Genzyme Corp. (2)	27,500	1,950,300
Gilead Sciences, Inc. (1)(2)	114,200	5,403,944
		7,354,244
Healthcare Equipment — 0.8%
Baxter International, Inc.	33,600	1,983,072
Healthcare Services — 1.5%
Medco Health Solutions, Inc. (2)	84,400	3,739,764
Healthcare Technology — 0.7%
Cerner Corp. (2)	41,300	1,794,485
Life Sciences Tools & Services — 2.1%
Thermo Fisher Scientific, Inc. (2)	93,000	5,201,490
Pharmaceuticals — 9.3%
Allergan, Inc. (1)	61,000	3,613,030
Bristol-Myers Squibb Co. (1)	92,000	2,080,120
Johnson & Johnson	80,000	4,956,800
Merck & Co., Inc.	137,000	6,069,100
Schering-Plough Corp.	261,400	5,672,380
		22,391,430
Total Healthcare		42,464,485
Industrials — 12.4%
Aerospace & Defense — 4.9%
General Dynamics Corp.	30,000	2,455,500
Lockheed Martin Corp.	37,000	3,818,400
Spirit Aerosystems Holdings, Inc. (2)	90,000	2,431,800
United Technologies Corp.	45,000	3,172,950
		11,878,650
Construction & Farm Machinery and Heavy Trucks — 1.6%
Deere & Co.	36,600	3,118,686
Oshkosh Corp.	22,400	897,568
		4,016,254
Electrical Components & Equipment — 2.3%
Emerson Electric Co.	68,050	3,467,828
Roper Industries, Inc. (1)	40,000	2,256,000
		5,723,828
Industrial Conglomerates — 2.6%
3M Co. (1)	50,000	3,920,000
General Electric Co.	71,000	2,352,940
		6,272,940
Industrial Machinery — 1.0%
ITT Corp.	41,800	2,350,832
Total Industrials		30,242,504

(See Notes which are an integral part of the Financial Statements)

5

Marshall Funds

Large-Cap Growth Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Information Technology — 25.2%
Application Software — 3.1%
Adobe Systems, Inc. (2)	105,700	$    3,556,805
FactSet Research Systems, Inc.	25,200	1,326,528
Intuit, Inc. (2)	100,000	2,656,000
		7,539,333
Communications Equipment — 4.8%
Cisco Systems, Inc. (2)	345,000	8,407,649
Corning, Inc.	140,000	3,252,200
		11,659,849
Computer Hardware — 3.8%
Apple, Inc. (2)	49,530	6,192,241
International Business Machines Corp.	27,200	3,096,992
		9,289,233
Computer Storage & Peripherals — 1.0%
EMC Corp. (2)	157,800	2,452,212
Consulting & Other Services — 0.9%
Cognizant Technology Solutions Corp. (2)	69,600	2,102,616
Internet Software & Services — 4.0%
Akamai Technologies, Inc. (1)(2)	35,000	1,230,600
eBay, Inc. (2)	55,000	1,449,800
Google, Inc., Class A (2)	14,920	7,030,006
		9,710,406
Semiconductors — 2.3%
Intel Corp.	286,480	5,715,276
Systems Software — 5.3%
Microsoft Corp. (1)	348,600	9,488,891
Oracle Corp. (2)	171,250	3,219,500
		12,708,391
Total Information Technology		61,177,316
Materials — 3.9%
Diversified Metals & Mining — 0.7%
Freeport-McMoRan Copper & Gold, Inc. (1)	16,000	1,613,760
Fertilizers & Agricultural Chemicals — 1.7%
Monsanto Co.	36,300	4,199,184
Industrial Gases — 0.9%
Praxair, Inc.	27,500	2,207,700
Steel — 0.6%
Nucor Corp.	24,000	1,549,680
Total Materials		9,570,324
Telecommunication Services — 0.4%
Integrated Telecommunication Services — 0.4%
Verizon Communications	30,100	1,093,232
Total Telecommunication Services		1,093,232
Utilities — 2.5%
Electric Utilities — 1.4%
Allegheny Energy, Inc.	22,300	1,129,941
Exelon Corp.	17,970	1,345,055
FPL Group, Inc.	19,000	1,145,510
		3,620,506

Description	Shares or Principal Amount	Value
Common Stocks (continued)
Utilities (continued)
Independent Power Producers & Energy Traders — 1.1%
Constellation Energy Group, Inc.	15,000	$    1,325,250
NRG Energy, Inc. (2)	30,600	1,262,862
		2,588,112
Total Utilities		6,208,618
Total Common Stocks (identified cost $223,201,643)		231,876,091
Short-Term Investments — 20.5%
Collateral Pool Investment for Securities on Loan — 17.0% (See Note 2 of the Financial Statements)		41,334,610
Repurchase Agreement — 3.5%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $8,529,694 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 10/10/2017, with a market value of $8,725,118 (at amortized cost)	$8,527,526	8,527,526
Total Short-Term Investments (identified cost $49,862,136)		49,862,136
Total Investments — 115.6% (identified cost $273,063,779)		281,738,227
Other Assets and Liabilities — (15.6)%		(37,985,660	)
Total Net Assets — 100.0%		$243,752,567

Portfolio Sector Allocations*
Sector	Fund
Consumer Discretionary	6.4%
Consumer Staples	11.2
Energy	8.4
Financials	7.3
Healthcare	17.4
Industrials	12.4
Information Technology	25.2
Materials	3.9
Telecommunication Services	0.4
Utilities	2.5
Other Assets & Liabilities, Net	4.9
Total	100.0%

(See Notes which are an integral part of the Financial Statements)

6

February 29, 2008 (Unaudited)

Schedule of Investments

Mid-Cap Value Fund

Description	Shares	Value
Common Stocks — 96.7%
Consumer Discretionary — 13.4%
Advertising — 1.2%
Interpublic Group of Cos., Inc. (1)(2)	545,560	$    4,702,727
Apparel Retail — 2.4%
The Gap, Inc. (1)	171,200	3,453,104
TJX Companies, Inc.	192,200	6,150,400
		9,603,504
Auto Parts & Equipment — 1.6%
Autoliv, Inc.	87,700	4,376,230
Johnson Controls, Inc.	66,000	2,168,760
		6,544,990
Broadcasting & Cable TV — 3.1%
Liberty Global, Inc. (1)(2)	141,200	5,309,120
Liberty Media Corp. (2)	62,300	7,233,653
		12,542,773
Department Stores — 0.6%
Kohl’s Corp. (1)(2)	50,560	2,246,886
Education Services — 0.4%
Apollo Group, Inc., Class A (1)(2)	26,500	1,626,570
Household Appliances — 2.7%
Snap-On, Inc.	117,400	5,860,608
Whirlpool Corp. (1)	58,200	4,910,334
		10,770,942
Internet Retail — 0.5%
Expedia, Inc. (2)	83,200	1,907,776
Restaurants — 0.9%
Yum! Brands, Inc. (1)	104,870	3,612,772
Total Consumer Discretionary		53,558,940
Consumer Staples — 6.9%
Food Retail — 3.1%
Kroger Co.	224,700	5,448,975
Safeway, Inc.	237,760	6,833,222
		12,282,197
Packaged Foods & Meats — 1.9%
ConAgra Foods, Inc.	144,000	3,182,400
Pilgrim’s Pride Corp.	183,460	4,303,972
		7,486,372
Soft Drinks — 0.5%
Coca-Cola Enterprises, Inc.	81,500	1,991,045
Tobacco — 1.4%
Loews Corp. – Carolina Group	74,300	5,594,047
Total Consumer Staples		27,353,661
Energy — 9.4%
Integrated Oil & Gas — 3.3%
Hess Corp. (1)	70,100	6,531,918
Murphy Oil Corp.	83,500	6,711,730
		13,243,648
Oil & Gas-Exploration and Production — 4.2%
Chesapeake Energy Corp.	68,500	3,097,570
Newfield Exploration Co. (1)(2)	97,000	5,371,860
Noble Energy, Inc.	104,200	8,065,080
		16,534,510

Description	Shares	Value
Common Stocks (continued)
Energy (continued)
Oil & Gas-Storage and Transportation — 1.9%
El Paso Corp.	473,900	$    7,724,570
Total Energy		37,502,728
Financials — 19.7%
Asset Management & Custody Banks — 3.3%
Ameriprise Financial, Inc.	59,200	2,997,888
BlackRock, Inc.	18,400	3,555,800
Northern Trust Corp.	55,600	3,760,228
State Street Corp.	33,700	2,647,135
		12,961,051
Insurance Brokers — 1.5%
Aon Corp.	142,800	5,941,908
Life & Health Insurance — 5.2%
Principal Financial Group, Inc. (1)	82,900	4,578,567
Protective Life Corp.	222,000	8,566,980
StanCorp Financial Group, Inc.	156,100	7,662,949
		20,808,496
Multi-Line Insurance — 1.0%
Assurant, Inc.	66,200	4,140,810
Property & Casualty Insurance — 3.3%
ACE Ltd.	108,600	6,107,664
Hanover Insurance Group, Inc.	165,800	7,243,802
		13,351,466
Real Estate Investment Trusts — 0.5%
Kimco Realty Corp. (1)	58,200	1,965,414
Regional Banks — 2.0%
City National Corp.	80,700	4,135,875
M&T Bank Corp.	45,900	3,767,472
		7,903,347
Reinsurance — 1.8%
PartnerRe Ltd.	93,300	7,173,837
Specialized Finance — 1.1%
CIT Group, Inc.	204,200	4,537,324
Total Financials		78,783,653
Healthcare — 5.7%
Healthcare Distributors — 1.6%
AmerisourceBergen Corp.	154,800	6,458,256
Healthcare Services — 1.4%
DaVita, Inc. (1)(2)	113,100	5,613,153
Healthcare Supplies — 1.0%
DENTSPLY International, Inc.	97,400	3,802,496
Life Sciences Tools & Services — 1.7%
Thermo Fisher Scientific, Inc. (2)	119,300	6,672,449
Total Healthcare		22,546,354
Industrials — 10.3%
Aerospace & Defense — 1.7%
Alliant Techsystems, Inc. (1)(2)	65,000	6,821,100
Airlines — 0.8%
Continental Airlines, Inc. (1)(2)	129,400	3,128,892
Environmental & Facilities Services — 1.2%
Republic Services, Inc.	159,230	4,861,292

(See Notes which are an integral part of the Financial Statements)

7

Marshall Funds

Mid-Cap Value Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Industrials (continued)
Human Resource & Employment Services — 1.6%
Manpower, Inc.	109,000	$    6,180,300
Industrial Machinery — 3.6%
Eaton Corp.	73,900	5,958,557
ITT Corp.	152,900	8,599,096
		14,557,653
Trucking — 1.4%
J.B. Hunt Transport Services, Inc. (1)	204,390	5,594,154
Total Industrials		41,143,391
Information Technology — 8.7%
Application Software — 1.1%
Synopsys, Inc. (2)	191,100	4,435,431
Computer Storage & Peripherals — 0.7%
Seagate Technology (1)	132,700	2,862,339
Data Processing & Outsourced Services — 1.2%
Fiserv, Inc. (2)	91,600	4,819,992
Electronic Manufacturing Services — 0.5%
Flextronics International Ltd. (2)	200,000	2,028,000
Office Electronics — 1.8%
Xerox Corp.	500,800	7,361,760
Semiconductors — 0.7%
Intersil Corp.	120,300	2,799,381
Technology Distributors — 2.7%
Arrow Electronics, Inc. (2)	135,900	4,431,699
Ingram Micro, Inc. (2)	225,500	3,443,385
Tech Data Corp. (2)	72,200	2,407,870
		10,282,954
Total Information Technology		34,589,857
Materials — 6.4%
Diversified Chemicals — 1.3%
PPG Industries, Inc.	81,130	5,028,437
Paper Packaging — 1.8%
Sealed Air Corp.	290,400	7,030,584
Paper Products — 1.2%
MeadWestvaco Corp. (1)	193,340	4,961,104
Specialty Chemicals — 1.1%
Cytec Industries, Inc.	79,900	4,576,672
Steel — 1.0%
Nucor Corp.	62,000	4,003,340
Total Materials		25,600,137
Telecommunication Services — 2.1%
Integrated Telecommunication Services — 2.1%
Embarq Corp.	102,300	4,290,462
Qwest Communications International, Inc. (1)	765,000	4,131,000
Total Telecommunication Services		8,421,462

Description	Shares or Principal Amount	Value
Common Stocks (continued)
Utilities — 14.1%
Electric Utilities — 6.9%
Edison International	175,200	$    8,654,880
Entergy Corp.	51,500	5,291,110
Pepco Holdings, Inc.	240,820	6,085,521
PPL Corp.	160,600	7,288,028
		27,319,539
Gas Utilities — 3.3%
Equitable Resources, Inc.	113,000	6,963,060
ONEOK, Inc.	129,800	6,044,786
		13,007,846
Multi-Utilities — 3.9%
CMS Energy Corp.	471,900	6,790,641
PG&E Corp. (1)	77,610	2,922,793
Sempra Energy	112,400	5,971,812
		15,685,246
Total Utilities		56,012,631
Total Common Stocks (identified cost $357,637,073)		385,512,815
Short-Term Investments — 14.8%
Collateral Pool Investment for Securities on Loan — 13.7% (See Note 2 of the Financial Statements)		54,445,999
Repurchase Agreement — 1.1%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $4,524,799 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $4,625,784 (at amortized cost)	$4,523,649	4,523,649
Total Short-Term Investments (identified cost $58,969,648)		58,969,648
Total Investments — 111.5% (identified cost $416,606,721)		444,482,463
Other Assets and Liabilities — (11.5)%		(45,823,018	)
Total Net Assets — 100.0%		$398,659,445

Portfolio Sector Allocations*
Sector	Fund
Consumer Discretionary	13.4%
Consumer Staples	6.9
Energy	9.4
Financials	19.7
Healthcare	5.7
Industrials	10.3
Information Technology	8.7
Materials	6.4
Telecommunication Services	2.1
Utilities	14.1
Other Assets & Liabilities, Net	3.3
Total	100.0%

(See Notes which are an integral part of the Financial Statements)

8

February 29, 2008 (Unaudited)

Schedule of Investments

Mid-Cap Growth Fund

Description	Shares	Value
Common Stocks — 97.0%
Consumer Discretionary — 14.1%
Apparel Retail — 0.6%
Guess?, Inc.	36,900	$    1,517,697
Apparel, Accessories & Luxury Goods — 0.8%
Hanesbrands, Inc. (2)	71,000	2,066,100
Auto Parts & Equipment — 0.6%
Johnson Controls, Inc.	48,400	1,590,424
Broadcasting & Cable TV — 2.6%
Central European Media Enterprises, Ltd. (2)	36,000	3,309,120
Discovery Holding Co., Class A (1)(2)	123,800	2,794,166
		6,103,286
Computer & Electronics Retail — 0.8%
GameStop Corp. (2)	46,600	1,973,976
Education Services — 1.8%
Apollo Group, Inc., Class A (2)	38,200	2,344,716
DeVry, Inc.	50,300	2,210,182
		4,554,898
Homebuilding — 1.5%
Gafisa S.A. ADR (1)(2)	92,200	3,611,474
Housewares & Specialties — 1.6%
Tupperware Brands Corp.	108,300	3,950,784
Movies & Entertainment — 1.4%
CTC Media, Inc. (1)(2)	120,800	3,546,688
Restaurants — 0.8%
Burger King Holdings, Inc.	81,500	2,091,290
Specialty Stores — 0.5%
Dick’s Sporting Goods, Inc. (1)(2)	45,400	1,252,132
Tires & Rubber — 1.1%
Goodyear Tire & Rubber Co. (1)(2)	102,200	2,769,620
Total Consumer Discretionary		35,028,369
Consumer Staples — 8.3%
Distillers & Vintners — 2.2%
Central European Distribution Corp. (1)(2)	96,700	5,626,006
Drug Retail — 1.3%
CVS Caremark Corp.	82,700	3,339,426
Household Products — 1.2%
Church & Dwight Co., Inc.	53,600	2,865,456
Packaged Foods & Meats — 1.5%
Sadia S.A. ADR (1)	213,633	3,608,261
Personal Products — 2.1%
Avon Products, Inc.	53,800	2,047,628
Chattem, Inc. (1)(2)	40,300	3,139,370
		5,186,998
Total Consumer Staples		20,626,147
Energy — 13.2%
Oil & Gas-Drilling — 3.0%
Diamond Offshore Drilling, Inc. (1)	16,400	1,981,612
Noble Corp.	42,200	2,074,130
Transocean, Inc. (1)	24,662	3,465,258
		7,521,000

Description	Shares	Value
Common Stocks (continued)
Energy (continued)
Oil & Gas-Exploration and Production — 10.2%
Arena Resources, Inc. (2)	71,400	$    2,890,272
Atlas America, Inc.	83,400	5,043,198
Chesapeake Energy Corp. (1)	103,600	4,684,792
Denbury Resources, Inc. (2)	104,300	3,326,127
Petrohawk Energy Corp. (1)(2)	190,000	3,435,200
Quicksilver Resources, Inc. (1)(2)	37,100	1,276,240
Ultra Petroleum Corp. (1)(2)	59,200	4,645,424
		25,301,253
Total Energy		32,822,253
Financials — 3.7%
Diversified Banks — 2.4%
Credicorp, Ltd. ADR	42,100	3,129,293
National Bank of Greece S.A. ADR	249,000	2,721,570
		5,850,863
Real Estate Investment Trusts — 1.3%
Annaly Capital Management, Inc.	154,950	3,205,916
Total Financials		9,056,779
Healthcare — 15.6%
Biotechnology — 2.9%
Alexion Pharmaceuticals, Inc. (1)(2)	31,600	1,915,276
BioMarin Pharmaceutical, Inc. (1)(2)	91,100	3,465,444
Millennium Pharmaceuticals, Inc. (1)(2)	125,200	1,751,548
		7,132,268
Healthcare Equipment — 3.1%
Gen-Probe, Inc. (2)	35,000	1,673,350
Mindray Medical International, Ltd. ADR (1)	51,300	1,882,710
Smith & Nephew PLC ADR	38,200	2,497,516
Stryker Corp.	26,300	1,712,393
		7,765,969
Healthcare Services — 1.2%
Pediatrix Medical Group, Inc. (2)	45,900	3,029,859
Healthcare Supplies — 1.6%
DENTSPLY International, Inc.	50,800	1,983,232
Inverness Medical Innovations, Inc. (1)(2)	67,200	1,958,880
		3,942,112
Life Sciences Tools & Services — 3.6%
Charles River Laboratories International, Inc. (2)	41,500	2,431,070
Covance, Inc. (2)	29,800	2,515,418
Thermo Fisher Scientific, Inc. (2)	65,400	3,657,822
		8,604,310
Pharmaceuticals — 3.2%
Perrigo Co.	103,300	3,452,286
Shire PLC ADR	36,100	2,109,684
Teva Pharmaceutical Industries, Ltd. ADR (1)	49,300	2,419,151
		7,981,121
Total Healthcare		38,455,639

(See Notes which are an integral part of the Financial Statements)

9

Marshall Funds

Mid-Cap Growth Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Industrials — 13.9%
Aerospace & Defense — 3.0%
Goodrich Corp.	44,100	$    2,612,043
L-3 Communications Holdings, Inc.	22,100	2,349,009
Precision Castparts Corp.	21,400	2,362,346
		7,323,398
Construction & Engineering — 1.5%
Chicago Bridge & Iron Co., N.V. ADR	42,300	1,967,796
Jacobs Engineering Group, Inc. (2)	22,400	1,798,496
		3,766,292
Construction & Farm Machinery and Heavy Trucks — 1.1%
Manitowoc Company, Inc.	64,400	2,623,656
Diversified Commercial & Professional Services — 2.9%
Brink’s Co.	36,900	2,469,717
Dun & Bradstreet Corp.	27,000	2,358,180
IHS, Inc., Class A (2)	39,300	2,422,845
		7,250,742
Electrical Components & Equipment — 0.8%
Roper Industries, Inc.	34,600	1,951,440
Human Resource & Employment Services — 0.8%
Watson Wyatt Worldwide, Inc.	38,900	2,063,645
Industrial Conglomerates — 0.6%
Textron, Inc.	28,800	1,560,096
Industrial Machinery — 3.2%
Harsco Corp.	44,400	2,508,156
ITT Corp.	41,300	2,322,712
SPX Corp.	30,000	3,069,000
		7,899,868
Total Industrials		34,439,137
Information Technology — 14.6%
Application Software — 4.6%
ANSYS, Inc. (1)(2)	52,300	1,954,451
Citrix Systems, Inc. (2)	94,300	3,105,299
Nuance Communications, Inc. (1)(2)	132,100	2,173,045
Solera Holdings, Inc. (2)	75,400	1,789,242
Synopsys, Inc. (2)	88,800	2,061,048
		11,083,085
Data Processing & Outsourced Services — 1.5%
DST Systems, Inc. (2)	28,400	1,995,384
Mastercard, Inc., Class A	9,600	1,824,000
		3,819,384
Electronic Equipment Manufacturers — 1.8%
Amphenol Corp., Class A	61,800	2,284,746
LG. Philips LCD Co., Ltd. ADR (1)(2)	95,700	2,264,262
		4,549,008
Home Entertainment Software — 1.1%
Activision, Inc. (2)	103,600	2,823,100

Description	Shares	Value
Common Stocks (continued)
Information Technology (continued)
Internet Software & Services — 1.3%
Equinix, Inc. (1)(2)	47,200	$     3,273,320
Semiconductor Equipment — 1.3%
MEMC Electronic Materials, Inc. (2)	43,300	3,302,924
Semiconductors — 0.5%
Microsemi Corp. (1)(2)	58,800	1,278,900
Systems Software — 1.9%
McAfee, Inc. (2)	75,800	2,521,866
Sybase, Inc. (2)	79,200	2,108,304
		4,630,170
Technology Distributors — 0.6%
Brightpoint, Inc. (2)	140,700	1,454,838
Total Information Technology		36,214,729
Materials — 11.5%
Diversified Chemicals — 0.8%
FMC Corp.	36,600	2,071,926
Fertilizers & Agricultural Chemicals — 3.3%
Agrium, Inc.	49,400	3,644,238
CF Industries Holdings, Inc. (1)	22,700	2,771,216
Monsanto Co.	15,400	1,781,472
		8,196,926
Industrial Gases — 1.9%
Air Products and Chemicals, Inc.	25,900	2,365,447
Praxair, Inc.	27,700	2,223,756
		4,589,203
Metal & Glass Containers — 1.7%
Owens-Illinois, Inc. (2)	73,700	4,160,365
Specialty Chemicals — 0.6%
Nalco Holdings Co.	73,200	1,581,120
Steel — 3.2%
Cleveland-Cliffs, Inc.	13,900	1,660,494
Gerdau Ameristeel Corp.	127,700	1,914,223
Mechel ADR (1)	20,500	2,707,025
Steel Dynamics, Inc.	29,100	1,695,366
		7,977,108
Total Materials		28,576,648
Telecommunication Services — 2.1%
Wireless Telecommunication Services — 2.1%
American Tower Corp., Class A (2)	80,400	3,090,576
Crown Castle International Corp. (2)	60,500	2,183,445
Total Telecommunication Services		5,274,021
Total Common Stocks (identified cost $215,843,064)		240,493,722
Short-Term Investments — 25.8%
Collateral Pool Investment for Securities on Loan — 24.3% (See Note 2 of the Financial Statements)		60,142,774

(See Notes which are an integral part of the Financial Statements)

10

February 29, 2008 (Unaudited)

Schedule of Investments

Mid-Cap Growth Fund (continued)

Description	Principal Amount	Value
Short-Term Investments (continued)
Repurchase Agreement — 1.5%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $3,828,822 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $3,912,122 (at amortized cost)	$3,827,849	$    3,827,849
Total Short-Term Investments (identified cost $63,970,623)		63,970,623
Total Investments — 122.8% (identified cost $279,813,687)		304,464,345
Other Assets and Liabilities — (22.8)%		(56,529,667	)
Total Net Assets — 100.0%		$247,934,678

Portfolio Sector Allocations*
Sector	Fund
Consumer Discretionary	14.1%
Consumer Staples	8.3
Energy	13.2
Financials	3.7
Healthcare	15.6
Industrials	13.9
Information Technology	14.6
Materials	11.5
Telecommunication Services	2.1
Other Assets & Liabilities, Net	3.0
Total	100.0%

Small-Cap Growth Fund

Description	Shares	Value
Common Stocks — 98.4%
Consumer Discretionary — 14.3%
Apparel Retail — 3.1%
Gymboree Corp. (2)	37,800	$    1,496,502
Iconix Brand Group, Inc. (1)(2)	148,900	3,094,142
NexCen Brands, Inc. (1)(2)	946,800	3,730,392
		8,321,036
Apparel, Accessories & Luxury Goods — 1.6%
Fuqi International, Inc. (2)	272,000	2,097,120
Hanesbrands, Inc. (2)	77,800	2,263,980
		4,361,100
Broadcasting & Cable TV — 1.2%
DG FastChannel, Inc. (2)	157,800	3,185,982
Education Services — 2.3%
DeVry, Inc.	56,200	2,469,428
INVESTools, Inc. (1)(2)	314,600	3,639,922
		6,109,350

Description	Shares	Value
Common Stocks (continued)
Consumer Discretionary (continued)
Homebuilding — 1.6%
Gafisa S.A. ADR (1)(2)	107,800	$    4,222,526
Housewares & Specialties — 1.7%
Tupperware Brands Corp.	122,500	4,468,800
Movies & Entertainment — 2.2%
CTC Media, Inc. (1)(2)	133,600	3,922,496
Imax Corp. (1)(2)	315,200	2,004,672
		5,927,168
Restaurants — 0.6%
Einstein Noah Restaurant Group, Inc. (2)	105,000	1,618,050
Total Consumer Discretionary		38,214,012
Consumer Staples — 4.4%
Agricultural Products — 0.7%
Darling International, Inc. (2)	131,700	1,830,630
Food Distributors — 2.3%
Central European Distribution Corp. (1)(2)	105,200	6,120,536
Personal Products — 1.4%
Chattem, Inc. (1)(2)	49,100	3,824,890
Total Consumer Staples		11,776,056
Energy — 14.5%
Oil & Gas-Exploration and Production — 13.3%
Arena Resources, Inc. (2)	106,200	4,298,976
Atlas America, Inc. (1)	82,900	5,012,963
Contango Oil & Gas Co. (1)(2)	129,300	8,313,990
Gasco Energy, Inc. (1)(2)	2,443,700	6,353,620
GMX Resources, Inc. (1)(2)	151,600	4,394,884
TXCO Resources, Inc. (1)(2)	358,100	4,984,752
Westside Energy Corp. (1)(2)	637,700	1,868,461
		35,227,646
Oil & Gas-Storage and Transportation — 1.2%
Golar LNG Ltd. (1)	174,300	3,327,387
Total Energy		38,555,033
Financials — 2.7%
Insurance Brokers — 0.3%
Life Partners Holdings, Inc. (1)	60,600	912,030
Multi-Sector Holdings — 0.7%
PICO Holdings, Inc. (1)(2)	56,600	1,934,588
Real Estate Investment Trusts — 0.9%
MFA Mortgage Investments, Inc.	240,200	2,296,312
Regional Banks — 0.8%
Oriental Financial Group, Inc.	100,900	2,100,738
Total Financials		7,243,668
Healthcare — 21.8%
Biotechnology — 3.7%
Alexion Pharmaceuticals, Inc. (1)(2)	36,600	2,218,326
BioMarin Pharmaceutical, Inc. (1)(2)	90,700	3,450,228
Cepheid, Inc. (1)(2)	91,400	2,529,952
Omrix Biopharmaceuticals, Inc. (2)	71,700	1,731,555
		9,930,061

(See Notes which are an integral part of the Financial Statements)

11

Marshall Funds

Small-Cap Growth Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Healthcare (continued)
Healthcare Equipment — 5.9%
ABIOMED, Inc. (1)(2)	114,500	$    1,637,350
Mindray Medical International, Ltd. ADR (1)	60,400	2,216,680
Natus Medical, Inc. (1)(2)	151,000	2,867,490
NuVasive, Inc. (1)(2)	75,300	2,902,062
Vnus Medical Technologies, Inc. (2)	119,100	2,225,979
Wright Medical Group, Inc. (1)(2)	135,300	3,561,096
		15,410,657
Healthcare Facilities — 0.7%
Sun Healthcare Group, Inc. (1)(2)	124,200	1,830,708
Healthcare Services — 2.4%
HMS Holdings Corp. (1)(2)	95,200	2,604,672
Pediatrix Medical Group, Inc. (2)	56,500	3,729,565
		6,334,237
Healthcare Supplies — 0.8%
Inverness Medical Innovations, Inc. (1)(2)	74,300	2,165,845
Healthcare Technology — 1.4%
MedAssets, Inc. (1)(2)	100,300	1,821,448
Trizetto Group, Inc. (2)	103,400	2,018,368
		3,839,816
Life Sciences Tools & Services — 2.1%
ICON PLC ADR (2)	44,700	2,954,670
PAREXEL International Corp. (2)	48,200	2,648,590
		5,603,260
Pharmaceuticals — 4.8%
Obagi Medical Products, Inc. (2)	165,130	2,569,423
Perrigo Co.	115,600	3,863,352
Questcor Pharmaceuticals, Inc. (1)(2)	612,700	2,757,150
Sucampo Pharmaceuticals, Inc., Class A (1)(2)	134,000	1,444,520
VIVUS, Inc. (1)(2)	353,400	2,070,924
		12,705,369
Total Healthcare		57,819,953
Industrials — 19.3%
Aerospace & Defense — 2.3%
BE Aerospace, Inc. (2)	85,300	2,925,790
Moog, Inc., Class A (1)(2)	75,800	3,110,832
		6,036,622
Building Products — 2.9%
Ameron International Corp.	52,400	5,783,388
Apogee Enterprises, Inc.	147,000	2,262,330
		8,045,718
Commercial Printing — 1.0%
Innerworkings, Inc. (1)(2)	201,800	2,778,786
Construction & Engineering — 0.9%
Aecom Technology Corp. (1)(2)	88,600	2,296,512
Construction & Farm Machinery and Heavy Trucks — 1.5%
Titan International, Inc. (1)	114,700	3,898,653

Description	Shares	Value
Common Stocks (continued)
Industrials (continued)
Diversified Commercial & Professional Services — 2.0%
Advisory Board Co. (1)(2)	60,600	$    3,367,542
China Direct, Inc. (1)(2)	304,700	1,983,597
		5,351,139
Electrical Components & Equipment — 3.6%
American Superconductor Corp. (1)(2)	176,500	3,987,135
EnerSys (1)(2)	115,800	2,662,242
Ultralife Batteries, Inc. (2)	222,500	3,139,475
		9,788,852
Environmental & Facilities Services — 2.3%
Clean Harbors, Inc. (1)(2)	46,200	2,842,224
Metalico, Inc. (1)(2)	275,100	3,199,413
		6,041,637
Human Resource & Employment Services — 0.9%
Watson Wyatt Worldwide, Inc.	43,000	2,281,150
Industrial Machinery — 1.9%
Kaydon Corp.	30,000	1,281,300
Middleby Corp. (1)(2)	54,600	3,712,800
		4,994,100
Total Industrials		51,513,169
Information Technology — 17.7%
Application Software — 4.1%
ANSYS, Inc. (1)(2)	57,800	2,159,986
Magma Design Automation, Inc. (2)	185,600	1,822,592
NetScout Systems, Inc. (2)	270,200	2,510,158
Nuance Communications, Inc. (1)(2)	147,200	2,421,440
Solera Holdings, Inc. (2)	83,500	1,981,455
		10,895,631
Communications Equipment — 1.6%
Harmonic, Inc. (2)	335,800	2,991,978
MRV Communications, Inc. (1)(2)	742,500	1,188,000
		4,179,978
Data Processing & Outsourced Services — 1.3%
TNS, Inc. (2)	191,700	3,421,845
Electronic Manufacturing Services — 0.7%
IPG Photonics Corp. (1)(2)	104,300	1,780,401
Internet Software & Services — 6.8%
Bankrate, Inc. (1)(2)	53,300	2,252,458
Equinix, Inc. (1)(2)	53,000	3,675,550
Internet Capital Group, Inc. (1)(2)	376,800	3,278,160
Points International, Ltd. (1)(2)	549,400	1,725,116
TheStreet.com, Inc. (1)	291,500	2,640,990
VistaPrint Ltd. (1)(2)	66,800	2,098,856
Websense, Inc. (2)	139,700	2,719,959
		18,391,089
Semiconductors — 0.9%
AuthenTec, Inc. (1)(2)	237,300	2,408,595
Systems Software — 1.7%
FalconStor Software, Inc. (1)(2)	301,200	2,505,984
Progress Software Corp. (2)	66,500	1,897,910
		4,403,894

(See Notes which are an integral part of the Financial Statements)

12

February 29, 2008 (Unaudited)

Schedule of Investments

Small-Cap Growth Fund (continued)

Description	Shares or Principal Amount	Value
Common Stocks (continued)
Information Technology (continued)
Technology Distributors — 0.6%
Brightpoint, Inc. (1)(2)	158,100	$    1,634,754
Total Information Technology		47,116,187
Materials — 0.5%
Diversified Metals & Mining — 0.5%
Compass Minerals International, Inc.	25,600	1,457,152
Total Materials		1,457,152
Telecommunication Services — 3.2%
Alternative Carriers — 1.3%
Premiere Global Services, Inc. (1)(2)	246,400	3,481,632
Wireless Telecommunication Services — 1.9%
SBA Communications Corp. (2)	94,400	2,931,120
Syniverse Holdings, Inc. (2)	128,300	2,174,685
		5,105,805
Total Telecommunication Services		8,587,437
Total Common Stocks (identified cost $251,470,702)		262,282,667
Short-Term Investments — 50.6%
Collateral Pool Investment for Securities on Loan — 48.3% (See Note 2 of the Financial Statements)		128,926,480
Repurchase Agreement — 2.3%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $6,081,881 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $6,203,660 (at amortized cost)	$6,080,336	6,080,336
Total Short-Term Investments (identified cost $135,006,816)		135,006,816
Total Investments — 149.0% (identified cost $386,477,518)		397,289,483
Other Assets and Liabilities — (49.0)%		(130,655,665	)
Total Net Assets — 100.0%		$266,633,818

Portfolio Sector Allocations*
Sector	Fund
Consumer Discretionary	14.3%
Consumer Staples	4.4
Energy	14.5
Financials	2.7
Healthcare	21.8
Industrials	19.3
Information Technology	17.7
Materials	0.5
Telecommunication Services	3.2
Other Assets & Liabilities, Net	1.6
Total	100.0%

International Stock Fund

Description	Shares	Value
Common Stocks — 97.0%
Australia — 4.2%
ASX, Ltd.	30,986	$    1,194,130
Bendigo Bank, Ltd.	6,515	60,205
BHP Billiton, Ltd. (1)	99,517	3,639,042
BlueScope Steel, Ltd.	132,687	1,328,342
Caltex Australian, Ltd. (1)	97,412	1,325,136
CSL, Ltd.	68,000	2,282,308
Incitec Pivot, Ltd.	11,229	1,521,306
Leighton Holdings, Ltd. (1)	75,132	3,135,957
Qantas Airways, Ltd. (1)	624,262	2,421,574
Santos, Ltd. (1)	121,747	1,441,151
Sims Group, Ltd. (1)	18,425	548,029
		18,897,180
Austria — 0.3%
OMV AG	3,946	284,930
Voestalpine AG	14,837	929,321
		1,214,251
Belgium — 2.0%
Delhaize Group (1)	24,642	1,869,583
Dexia SA (1)	114,105	2,685,267
KBC GROEP NV (1)	36,703	4,597,975
		9,152,825
Brazil — 0.6%
Companhia Vale do Rio Doce, ADR	36,100	1,257,724
Itausa-Investimentos Itau SA	11,300	71,832
Net Servicos de Comunicacao SA (2)	79,572	875,664
Tele Norte Leste Participacoes SA	10,200	254,593
		2,459,813
Canada — 2.2%
Brookfield Asset Management, Inc., Class A	57,900	1,713,028
Canadian Imperial Bank of Commerce	4,200	285,007
Gildan Activewear, Inc. (2)	50,500	1,899,939
Magna International, Inc.	1,500	110,003
National Bank of Canada	5,400	266,530
Petro-Canada	11,500	550,434
Research In Motion, Ltd. (2)	48,900	5,075,820
		9,900,761

(See Notes which are an integral part of the Financial Statements)

13

Marshall Funds

International Stock Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Denmark — 0.2%
D/S Norden A/S	6,129	$       667,720
Finland — 1.1%
Nokia Oyj (1)	138,350	4,976,342
France — 8.5%
Air France-KLM (1)	44,863	1,206,901
Alstom (1)	29,087	6,097,722
BNP Paribas SA	73,468	6,599,660
Bouygues SA (1)	54,900	3,751,732
Cap Gemini SA	17,444	957,807
Credit Agricole SA (1)	50,138	1,363,299
France Telecom SA (1)	121,899	4,096,031
Groupe DANONE (1)	42,572	3,345,869
LVMH Moet Hennessy Louis Vuitton SA	26,602	2,737,398
PPR	19,275	2,633,882
PSA Peugeot Citroen	28,581	2,173,827
Thomson	17,266	133,021
UbiSoft Entertainment SA (2)	6,897	577,877
Vallourec SA	12,245	2,538,656
		38,213,682
Germany — 14.8%
Bayer AG (1)	54,393	4,141,717
Beiersdorf AG	2,871	228,568
Commerzbank AG (1)	155,500	4,647,524
Daimler AG (1)	38,921	3,272,515
Deutsche Boerse AG	27,786	4,339,681
Deutsche Lufthansa AG (1)	213,780	4,965,901
E.ON AG	2,439	458,308
Fresenius Medical Care AG	58,200	4,893,136
GEA Group AG	147,100	4,805,206
MAN AG (1)	66,121	8,560,894
Metro AG (1)	48,455	4,050,146
Norddeutsche Affinerie AG	1,666	66,527
RWE AG	33,209	4,005,672
Salzgitter AG	25,545	4,471,881
SAP AG	58,833	2,801,408
Siemens AG	38,426	4,904,837
ThyssenKrupp AG	77,749	4,460,989
TUI AG (1)	53,621	1,284,789
		66,359,699
Greece — 0.4%
Alapis Holding Industrial & Commercial SA	64,223	207,959
OPAP SA	53,600	1,752,996
		1,960,955
Hong Kong — 1.8%
Esprit Holdings, Ltd.	33,300	413,858
Hutchison Whampoa, Ltd.	651,000	6,103,116
Kingboard Chemical Holdings, Ltd.	14,500	64,398
Sun Hung Kai Properties	85,500	1,486,373
		8,067,745
India — 0.4%
Satyam Computer Services, Ltd.	62,900	1,571,242
Indonesia — 0.1%
PT Gundang Garam Tbk	656,434	567,661
Israel — 0.1%
Bank Leumi Le-Israel	101,507	468,262

Description	Shares	Value
Common Stocks (continued)
Italy — 3.5%
Enel SpA	108,225	$    1,165,170
Fiat SpA	300,696	6,310,580
Lottomatica SpA (1)	136,800	4,935,722
Mediolanum SpA (1)	514,300	3,228,856
		15,640,328
Japan — 20.6%
AISIN SEIKI Co., Ltd.	40,700	1,624,295
Alpine Electronics, Inc.	3,800	44,426
Bank of Kyoto, Ltd.	12,000	139,070
BROTHER INDUSTRIES, Ltd.	28,103	298,068
Canon, Inc.	40,450	1,810,492
Chiba Bank, Ltd.	39,000	248,079
Chugoku Bank, Ltd.	5,000	67,522
Credit Saison Co., Ltd.	218,620	5,993,244
DAIHATSU MOTOR Co., Ltd.	30,000	318,451
DAIICHI SANKYO Co., Ltd.	49,500	1,539,672
DeNA Co., Ltd.	79	511,731
Don Quijote Co., Ltd.	19,400	312,015
FamilyMart Co., Ltd.	3,400	100,818
FUJIFILM Holdings Corp.	17,000	637,956
Hachijuni Bank, Ltd.	13,000	85,439
Haseko Corp.	640,000	961,916
Hitachi Construction Machinery Co., Ltd.	481,000	3,467,347
HOYA Corp.	86,300	2,194,199
IBIDEN Co., Ltd.	29,816	1,425,154
INPEX Holdings, Inc.	212	2,369,157
ITOCHU Corp.	49,000	515,338
Iyo Bank, Ltd.	7,000	68,420
JAPAN TOBACCO, Inc.	400	2,015,899
Kawasaki Kisen Kaisha, Ltd.	99,000	1,005,580
Kobe Steel, Ltd.	99,000	307,699
KOITO MANUFACTURING Co., Ltd.	10,000	130,795
KOMATSU, Ltd.	81,600	2,073,511
Komeri Co., Ltd.	61,100	1,424,798
KONICA MINOLTA HOLDINGS, Inc.	37,000	525,121
LAWSON, Inc.	40,400	1,546,079
LEOPALACE21 Corp.	34,700	704,245
Makita Corp.	43,800	1,544,870
Marubeni Corp.	486,000	3,667,667
Matsushita Electric Industrial Co., Ltd.	28,000	588,427
Mitsubishi Electric Corp.	51,000	465,917
Mitsubishi Heavy Industries, Ltd.	562,000	2,624,542
Mitsubishi Materials Corp.	84,000	393,555
Mitsubishi UFJ Lease & Finance Co., Ltd.	1,520	54,431
Mitsui O.S.K. Lines, Ltd.	162,000	2,105,155
Mitsui Trust Holdings, Inc.	467,000	3,200,619
MITSUMI ELECTRIC Co., Ltd.	16,400	508,033
Mizuho Financial Group, Inc.	748	3,107,153
Mizuho Trust & Banking Co., Ltd. (1)	436,000	691,120
NEC Electronics Corp. (2)	6,800	138,072
NIKON Corp.	36,000	1,009,975
Nintendo Co., Ltd.	22,500	11,171,613
NIPPON MINING HOLDINGS, Inc.	39,500	231,663
NIPPON OIL Corp.	283,000	1,929,143
NIPPON TELEGRAPH & TELEPHONE Corp.	294	1,276,232

(See Notes which are an integral part of the Financial Statements)

14

February 29, 2008 (Unaudited)

Schedule of Investments

International Stock Fund (continued)

Description	Shares	Value
Common Stocks (continued)
Japan (continued)
Nippon Yakin Kogyo Co., Ltd.	103,500	$       981,976
NISHIMATSUYA CHAIN Co., Ltd. (1)	81,165	773,977
Nisshin Steel Co., Ltd.	158,000	566,319
Nitori Co., Ltd.	55,150	2,733,332
OLYMPUS Corp.	13,000	381,150
Resona Holdings, Inc. (1)	367	592,678
SANYO ELECTRIC Co., Ltd. (2)	82,000	171,569
Sapporo Hokuyo Holdings, Inc.	11	85,395
Seiko Epson Corp.	24,400	624,526
SHINWA KAIUN KAISHA, Ltd.	9,000	58,928
Sojitz Corp.	274,200	1,030,286
Sumikin Bussan Corp.	26,000	86,392
Sumitomo Metal Industries, Ltd.	552,000	2,341,464
Sumitomo Mitsui Financial Group, Inc.	615	4,424,548
SUZUKI MOTOR Corp.	7,300	197,413
TAKEFUJI Corp.	7,520	189,203
Tohoku Electric Power Co., Inc.	2,900	66,640
TOKAI RIKA Co., Ltd.	4,000	114,983
TOKYO TEKKO Co., Ltd.	4,000	15,383
TOYODA GOSEI Co., Ltd.	6,500	235,541
TOYOTA BOSHOKU Corp.	77	2,651
Toyota Motor Corp.	97,000	5,279,008
Yamaha Motor Co., Ltd.	99,800	1,982,478
YAMATO KOGYO Co., Ltd.	4,100	171,985
		92,282,548
Luxembourg — 1.0%
Acergy SA	214,981	4,611,209
Malaysia — 0.2%
Resorts World Berhad	931,525	1,078,943
Mexico — 0.9%
Axtel SAB de CV (2)	93,100	206,280
Grupo Financiero Banorte SAB de CV	11,500	47,782
Grupo Mexico SAB de CV	114,773	798,374
Grupo Televisa SA	50,500	1,111,000
Telefonos de Mexico SA de CV	985,600	1,640,827
		3,804,263
Netherlands — 3.8%
Aegon NV	1	15
Draka Holding NV	1,232	35,414
Heineken NV (1)	64,538	3,639,001
Hunter Douglas NV	2,114	122,738
ING Groep NV	231,191	7,700,521
Koninklijke Ahold NV (2)	40,535	532,489
Koninklijke (Royal) Philips Electronics NV (1)	123,821	4,839,052
Oce NV	10,658	197,683
TomTom NV (2)	2,069	96,766
		17,163,679
New Zealand — 0.0%
Fletcher Building Ltd.	4,263	32,480
Norway — 2.1%
Cermaq ASA	5,051	68,527
Norsk Hydro ASA (1)	43,200	611,406
Petroleum Geo-Services ASA (1)	199,550	4,785,773
Telenor ASA (1)	193,400	3,964,566
		9,430,272

Description	Shares	Value
Common Stocks (continued)
Russian Federation — 1.4%
Gazprom	31,200	$    1,576,790
GMK Norilsk Nickel, ADR	35,140	1,031,359
LUKOIL, ADR	50,001	3,716,240
		6,324,389
Singapore — 0.3%
Jardine Cycle & Carriage, Ltd.	33,000	496,542
Neptune Orient Lines, Ltd.	222,000	485,318
SembCorp Industries, Ltd.	38,000	127,552
Singapore Airlines, Ltd.	14,933	161,927
		1,271,339
South Africa — 0.2%
Massmart Holdings, Ltd.	115,100	1,050,574
South Korea — 2.2%
CJ Home Shopping	14,976	906,971
Honam Petrochemical Corp.	1,946	189,287
Kookmin Bank, ADR	39,900	2,443,077
KT Corp.	28,740	1,413,792
Samsung Electronics Co., Ltd.	8,630	5,066,358
		10,019,485
Spain — 0.4%
Banco Santander SA (1)	103,759	1,854,623
Sweden — 2.8%
Alfa Laval AB	2,550	137,008
Electrolux AB (1)	149,000	2,382,055
Elekta AB, Class B (1)	210,500	3,835,516
JM AB (1)	27,600	587,457
Kinnevik Investment AB, Class B	9,800	187,894
Scania AB (1)	16,300	391,467
Skandinaviska Enskilda Banken AB, Class A (1)	66,600	1,657,109
Volvo AB, Class B (1)	221,100	3,272,188
		12,450,694
Switzerland — 6.1%
Galenica AG	1,202	463,639
Julius Baer Holding, Ltd.	57,991	4,292,958
Meyer Burger Technology AG (2)	262	75,566
Nestle SA	10,510	5,023,164
Novartis AG-REG (1)	42,808	2,103,983
Roche Holding AG	20,596	4,044,882
Swatch Group AG	7,016	2,054,326
Zurich Financial Services AG	29,850	9,355,302
		27,413,820
Turkey — 0.6%
Akbank TAS	163,700	873,707
Dogan Sirketler Grubu Holding AS (2)	604,440	755,486
Eregli Demir ve Celik Fabrikalari AS	109,429	769,590
Koc Holding AS (2)	1	2
Tupras-Turkiye Petrol Rafinerileri AS	10,375	262,518
Turkcell Iletisim Hizmetleri	1	8
		2,661,311
United Kingdom — 14.2%
3i Group PLC	18,158	294,656
Antofagasta PLC	377,265	6,001,247
AstraZeneca PLC	156,479	5,872,393
BG Group PLC	115,067	2,710,830
BHP Billiton PLC	26,323	848,589

(See Notes which are an integral part of the Financial Statements)

15

Marshall Funds

International Stock Fund (continued)

Description	Shares	Value
Common Stocks (continued)
United Kingdom (continued)
British Land Co. PLC	50,924	$       958,511
BT Group PLC	1,410,222	6,299,758
Cairn Energy PLC (2)	74,235	3,993,427
Capita Group PLC	37,170	481,168
Drax Group PLC	14,385	164,507
IMI PLC	22,232	170,486
Imperial Tobacco Group PLC	15,160	703,821
Kazakhmys PLC	26,964	819,527
Keller Group PLC	2,605	30,866
Land Securities Group PLC	38,983	1,214,011
Lonmin PLC	71,687	4,666,690
National Grid PLC	185,815	2,693,534
Next PLC	15,368	389,510
Petrofac, Ltd.	13,317	145,934
Prudential PLC	334,945	4,005,233
Royal Dutch Shell PLC, Class A	291,061	10,476,845
Shire PLC	79,038	1,544,098
Smith & Nephew PLC	250,800	3,246,609
Thomas Cook Group PLC (2)	33,894	204,716
WPP Group PLC	92,007	1,080,911
Xstrata PLC	60,577	4,751,648
		63,769,525
United States — 0.0%
Brookfield Infrastructure Partners LP	2,408	45,270
Eurocastle Investment, Ltd.	2,403	61,461
		106,731
Total Common Stocks (identified cost $413,241,367)		435,444,351
Rights — 0.0%
Brazil — 0.0%
Net Servicos de Comunicacao SA (2)	941	67
Total Rights (identified cost $0)		67
Short-Term Investments — 22.2%
Collateral Pool Investment for Securities on Loan — 22.2% (See Note 2 of the Financial Statements)		99,667,797
Total Short-Term Investments (identified cost $99,667,797)		99,667,797
Total Investments — 119.2% (identified cost $512,909,164)		535,112,215
Other Assets and Liabilities — (19.2)%		(86,123,655	)
Total Net Assets — 100.0%		$448,988,560

Portfolio Sector Allocations*
Sector	Fund
Consumer Discretionary	13.2%
Consumer Staples	5.6
Energy	9.0
Financials	19.5
Healthcare	6.7
Industrials	15.6
Information Technology	9.8
Materials	10.6
Telecommunication Services	5.1
Utilities	1.9
Other Assets & Liabilities, Net	3.0
Total	100.0%

(See Notes which are an integral part of the Financial Statements)

16

February 29, 2008 (Unaudited)

Schedule of Investments

International Stock Fund (continued)

Industry Division

Industry	Value			% of Total Net Assets
Agriculture	$	3,287,381		0.7	%
Airlines		8,756,303		2.0
Apparel		2,313,797		0.5
Automobiles		20,161,528		4.5
Banks		44,805,249		10.0
Beverages		3,639,000		0.8
Biotechnology		2,282,308		0.5
Building Materials		32,480		0.0
Chemicals		5,916,708		1.3
Closed-end Funds		61,461		0.0
Commercial Services		481,168		0.1
Computers		6,033,627		1.3
Cosmetics		228,568		0.1
Distribution/Wholesale		5,796,225		1.3
Diversified Financial Services		12,006,365		2.7
Electronics		22,003,853		4.9
Engineering & Construction		7,633,564		1.7
Entertainment		6,688,717		1.5
Food & Staple Retailing		14,889,778		3.3
Healthcare		11,975,261		2.7
Holding Companies		14,473,040		3.2
Home Builders		961,916		0.2
Home Furnishings		3,270,668		0.7
Insurance		24,289,927		5.4
Internet		511,730		0.1
Iron & Steel		16,344,948		3.6
Leisure Time		4,550,927		1.0
Machinery		21,624,752		4.8
Media		3,067,642		0.7
Metals & Mining		27,972,375		6.2
Miscellaneous Manufacturing		10,391,075		2.3
Office & Business Equipment		2,632,701		0.6
Oil & Gas		40,411,181		9.0
Pharmaceuticals		15,776,625		3.5
Real Estate		3,903,646		0.9
REITs		2,172,522		0.5
Retail		13,926,281		3.1
Semiconductor Equipment & Products		5,204,429		1.2
Software		5,047,293		1.1
Telecommunications		24,128,428		5.4
Toys		11,171,614		2.5
Transportation		4,322,701		1.0
Venture Capital		294,656		0.1
Total Common Stocks		435,444,418		97.0
Collateral Pool Investment for Securities on Loan		99,667,797		22.2
Total Investments		535,112,215		119.2
Other Assets & Liabilities		(86,123,655	)	(19.2	)
Total Net Assets	$	448,988,560		100.0	%

Aggregate Bond Fund

Description	Principal Amount	Value
Asset-Backed Securities — 1.2%
Other Financial — 1.2%
Chase Issuance Trust, Class A, (Series 2007-A15), 4.960%, 9/17/2012	$  3,000,000	$    3,104,019
Total Asset-Backed Securities (identified cost $2,999,707)		3,104,019
Collateralized Mortgage Obligations — 29.0%
Federal National Mortgage Association — 1.2%
5.500%, 8/25/2034, (Series 2005-123-PE) (1)	3,000,000	3,038,574
Other Financial — 27.8%
Bear Stearns Commercial Mortgage Securities, Class AM, (Series 2007-PW17), 5.915%, 6/11/2050 (4)	3,000,000	2,638,770
Chase Mortgage Finance Corp., Class 7A1, (Series 2007-A2), 5.890%, 7/25/2037 (4)	5,445,154	5,464,800
Citigroup Commercial Mortgage Trust, Class A4, (Series 2006-C5), 5.431%, 10/15/2049	4,000,000	3,811,324
Citigroup Commercial Mortgage Trust, Class A4, (Series 2007-C6), 5.700%, 12/10/2049 (4)	3,000,000	2,887,836
Countrywide Alternative Loan Trust, Class A19, (Series 2007-15CB), 5.750%, 7/25/2037	2,905,506	2,821,842
Credit Suisse Mortgage Capital Certificates, Class AM, (Series 2007-C5), 5.869%, 9/15/2040 (4)	3,000,000	2,629,053
Greenwich Capital Commercial Funding Corp., Class AM, (Series 2007-GG9), 5.475%, 3/10/2039	2,000,000	1,719,112
Greenwich Capital Commercial Funding Corp., Class AM, (Series 2007-GG11), 5.867%, 12/10/2049 (4)	3,000,000	2,620,866
JP Morgan Alternative Loan Trust, Class 12A1, (Series 2007-A2), 3.335%, 6/25/2037 (4)	5,473,594	4,401,897
JP Morgan Chase Commercial Mortgage Securities Corp., Class A1, (Series 2007-FL1A), 3.496%, 7/15/2019 (4)(6)(7)	2,649,825	2,544,397
JP Morgan Mortgage Trust, Class 2A1, (Series 2006-A3), 5.620%, 5/25/2036 (4)	2,135,701	2,151,827
JP Morgan Mortgage Trust, Class 2A1, (Series 2007-A2), 5.711%, 4/25/2037 (4)	1,666,060	1,671,635
JP Morgan Mortgage Trust, Class 3A3, (Series 2007-A4), 5.883%, 6/25/2037 (4)	4,755,171	4,772,570

(See Notes which are an integral part of the Financial Statements)

17

Marshall Funds

Aggregate Bond Fund (continued)

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Other Financial (continued)
Lehman Brothers Commercial Mortgage Trust, Class A1, (Series 2007-LLFA), 3.421%, 6/15/2022 (4)(6)(7)	$  4,536,399	$    4,364,882
Merrill Lynch/Countrywide Commercial Mortgage Trust, Class A4, (Series 2007-9), 5.700%, 9/12/2049	2,000,000	1,909,030
Merrill Lynch Mortgage Trust, Class A3A, (Series 2005-CIP1), 4.949%, 7/12/2038 (4)	2,000,000	1,944,082
Merrill Lynch Mortgage Trust, Class A3, (Series 2006-C1), 5.658%, 5/12/2039 (4)	2,000,000	1,968,496
Morgan Stanley Capital, Class A2A, (Series 2005-HQ6), 4.882%, 8/13/2042	3,000,000	2,961,255
Morgan Stanley Capital, Class A4, (Series 2007-IQ15), 5.882%, 6/11/2049 (4)	3,000,000	2,924,886
PHH Alternative Mortgage Trust, Class 1A1, (Series 2007-2), 3.245%, 5/25/2037 (4)	2,295,698	2,142,655
TIAA Retail Commercial Trust, Class A3, (Series 2007-C4), 6.096%, 8/15/2039 (4)	5,000,000	4,962,080
Wachovia Bank Commercial Mortgage Trust, Class AM, (Series 2007-C34), 5.818%, 5/15/2046 (4)	2,944,000	2,557,650
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR7), 5.605%, 5/25/2036 (4)	3,435,688	3,449,129
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR8), 5.241%, 4/25/2036 (4)	2,036,486	2,044,131
		71,364,205
Total Collateralized Mortgage Obligations (identified cost $77,344,347)		74,402,779
Corporate Bonds & Notes — 25.8%
Banks — 2.4%
Bank of America Corp., 5.750%, 12/1/2017	3,000,000	3,071,445
Bank of America Corp., 8.000%, 12/29/2049 (4)	2,000,000	2,075,146
Wachovia Corp., 5.750%, 2/1/2018 (1)	1,000,000	1,007,126
		6,153,717
Broker/Dealers — 11.0%
Bear Stearns Co., Inc., 7.250%, 2/1/2018	2,000,000	1,943,720
Citigroup, Inc., 5.300%, 10/17/2012	2,000,000	2,060,624

Description	Principal Amount	Value
Corporate Bonds & Notes (continued)
Broker/Dealers (continued)
Goldman Sachs Group, Inc., 5.450%, 11/1/2012	$  3,000,000	$    3,143,664
Goldman Sachs Group, Inc., 6.750%, 10/1/2037	4,000,000	3,745,936
JP Morgan Chase & Co., 5.375%, 10/1/2012	3,000,000	3,153,960
JP Morgan Chase & Co., 6.000%, 1/15/2018	2,000,000	2,079,060
Lehman Brothers Holdings, 6.875%, 7/17/2037 (1)	3,000,000	2,860,563
Lehman Brothers Holdings, (Series MTN), 5.625%, 1/24/2013	3,000,000	3,005,859
Lehman Brothers Holdings, (Series MTN), 6.000%, 7/19/2012	3,000,000	3,087,030
Morgan Stanley, 3.875%, 1/15/2009 (1)	3,000,000	2,999,292
		28,079,708
Construction Equipment — 1.1%
CRH America, Inc., 6.000%, 9/30/2016 (1)	3,000,000	2,895,774
Energy — 0.8%
XTO Energy, Inc., 6.250%, 8/1/2017	2,000,000	2,138,420
Financial Services — 6.1%
Countrywide Financial Corp., (Series MTN), 5.800%, 6/7/2012	2,000,000	1,799,264
General Electric Capital Corp., 5.875%, 1/14/2038	3,000,000	2,877,693
General Electric Capital Corp., (Series MTNA), 6.000%, 6/15/2012 (1)	2,000,000	2,147,136
Genworth Global Funding Trusts, 5.200%, 10/8/2010	2,000,000	2,067,892
Progressive Corp., 6.700%, 6/15/2037 (4)	3,000,000	2,656,779
Prudential Financial, Inc., 6.000%, 12/1/2017	2,000,000	2,053,146
Santander Perpetual SA, (Series 144A), 6.671%, 10/24/2017 (4)(6)(7)	2,000,000	2,016,266
		15,618,176
Media — 0.8%
Comcast Corp., 6.950%, 8/15/2037 (1)	2,000,000	2,031,182
Restaurants — 1.2%
McDonald’s Corp., (Series MTN), 4.300%, 3/1/2013	3,000,000	3,055,806
Retail — 0.8%
Target Corp., 7.000%, 1/15/2038	2,000,000	2,102,216
Telecommunication Services — 1.6%
AT&T, Inc., 6.300%, 1/15/2038	4,000,000	3,953,980
Total Corporate Bonds & Notes (identified cost $65,613,277)		66,028,979

(See Notes which are an integral part of the Financial Statements)

18

February 29, 2008 (Unaudited)

Schedule of Investments

Aggregate Bond Fund (continued)

Description	Principal Amount	Value
Government Agencies — 6.4%
Federal Home Loan Mortgage Corporation — 5.2%
3.375%, 4/15/2009	$  5,000,000	$    5,059,670
4.625%, 12/19/2008	3,000,000	3,052,149
4.875%, 2/17/2009	5,000,000	5,119,995
		13,231,814
Federal National Mortgage Association — 1.2%
4.875%, 4/15/2009	3,000,000	3,085,116
Total Government Agencies (identified cost $15,858,248)		16,316,930
Mortgage-Backed Securities — 24.3%
Federal Home Loan Mortgage Corporation — 1.4%
5.000%, 11/1/2035 (1)	3,720,459	3,671,780
Federal National Mortgage Association — 22.9%
5.000%, 7/1/2022 (1)	5,789,245	5,857,367
5.000%, 1/1/2037 (1)	9,790,734	9,651,099
5.500%, 5/1/2037 (1)	16,443,769	16,548,401
6.000%, 3/12/2038 (5)	17,000,000	17,369,223
6.500%, 9/1/2037 (1)	4,882,969	5,063,898
6.500%, 9/1/2037 (1)	1,926,428	1,997,808
6.500%, 11/1/2037 (1)	1,916,808	1,977,397
		58,465,193
Total Mortgage-Backed Securities (identified cost $60,398,055)		62,136,973
U.S. Treasury Bonds & Notes — 13.4%
2.875%, 1/31/2013 (1)	5,000,000	5,089,455
3.500%, 2/15/2018 (1)	5,000,000	4,989,065
4.375%, 2/15/2038 (1)	10,000,000	9,927,350
4.750%, 5/15/2014 (1)	5,000,000	5,548,050
4.875%, 4/30/2011 (1)	8,000,000	8,718,752
Total U.S. Treasury Bonds & Notes (identified cost $32,355,809)		34,272,672
Short-Term Investments — 40.9%
Collateral Pool Investment for Securities on Loan — 35.1% (See Note 2 of the Financial Statements)		89,983,266
Repurchase Agreement — 5.8%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $14,872,479 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with various maturities to 10/12/2012, with a market value of $15,470,226 (at amortized cost)	14,868,700	14,868,700
Total Short-Term Investments (identified cost $104,851,966)		104,851,966
Total Investments — 141.0% (identified cost $359,421,409)		361,114,318
Other Assets and Liabilities — (41.0)%		(105,085,332	)
Total Net Assets — 100.0%		$256,028,986

Portfolio Sector Allocations*
Sector	Fund
Asset-Backed Securities	1.2%
Collateralized Mortgage Obligations	29.0
Corporate Bonds & Notes	25.8
Government Agencies	6.4
Mortgage-Backed Securities	24.3
U.S. Treasury Bonds & Notes	13.4
Other Assets & Liabilities, Net	(0.1)
Total	100.0%

Government Income Fund

Description	Principal Amount	Value
Asset-Backed Securities — 1.6%
Federal Home Loan Mortgage Corporation — 0.1%
5.580%, 8/25/2031, (Series T-32-A1) (4)	$       880,373	$       866,661
Other Financial — 1.5%
Chase Issuance Trust, Class A, (Series 2007-A15), 4.960%, 9/17/2012	5,000,000	5,173,364
Countrywide Asset-Backed Certificates, Class A1, (Series 2007-QH2), 3.375%, 4/25/2037 (4)(6)(7)	4,092,192	3,885,581
Green Tree Home Improvement Loan Trust, Class HEB1, (Series 1998-B), 7.810%, 11/15/2029	1,008,235	1,009,982
Structured Asset Securities Corp. Trust, Class A2, (Series 2004-16XS), 4.910%, 8/25/2034 (4)	202,939	202,542
		10,271,469
Total Asset-Backed Securities (identified cost $11,185,306)		11,138,130
Collateralized Mortgage Obligations — 35.6%
Federal Home Loan Mortgage Corporation — 4.0%
3.471%, 6/15/2025, (Series 2993-TF) (4)	8,563,309	8,523,326
5.000%, 10/15/2029, (Series 2745-AY)	5,000,000	5,109,005
5.000%, 10/15/2031, REMIC (Series 2543-LN)	3,448,089	3,525,250
5.000%, 5/15/2033, REMIC (Series 2791-BL)	2,134,499	2,176,935
5.000%, 10/15/2034, REMIC (Series 2876-DQ)	400,172	403,443
5.000%, 4/15/2035, REMIC (Series 2963-ED)	1,374,812	1,345,878
5.500%, 10/15/2035, (Series 3058-WC)	2,425,401	2,448,597
6.000%, 6/15/2037, (Series 3333-W)	4,655,453	4,688,683
		28,221,117

(See Notes which are an integral part of the Financial Statements)

19

Marshall Funds

Government Income Fund (continued)

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Federal National Mortgage Association — 2.1%
3.385%, 1/25/2031, REMIC (Series 2001-25-FA) (4)	$    2,138,385	$    2,134,743
4.000%, 10/25/2032, REMIC (Series 2003-28-GA)	415,818	411,767
5.000%, 10/25/2016, REMIC (Series 2003-16-PD)	5,000,000	5,181,225
5.500%, 8/25/2034, (Series 2005-123-PE) (1)	5,407,000	5,476,524
5.500%, 11/25/2035, (Series 2005-100-DA) (1)	1,461,557	1,450,347
		14,654,606
Other Financial — 29.5%
Banc of America Funding Corp., Class 1A3, (Series 2007-C), 5.760%, 5/20/2036 (4)	7,251,207	7,263,520
Bear Stearns Commercial Mortgage Securities, Class AM, (Series 2007-PW17), 5.915%, 6/11/2050 (4)	6,000,000	5,277,540
Chase Mortgage Finance Corp., Class 11A1, (Series 2007-A1), 5.686%, 3/25/2037 (4)	11,918,030	12,082,999
Chase Mortgage Finance Corp., Class 7A1, (Series 2007-A2), 5.890%, 7/25/2037 (4)	9,075,257	9,108,000
Citigroup Commercial Mortgage Trust, Class A4, (Series 2006-C5), 5.431%, 10/15/2049	6,578,000	6,267,722
Citigroup Commercial Mortgage Trust, Class A4, (Series 2007-C6), 5.700%, 12/10/2049 (4)	6,000,000	5,775,672
Countrywide Alternative Loan Trust, Class A19, (Series 2007-15CB), 5.750%, 7/25/2037	6,779,513	6,584,297
Countrywide Home Loans, Class 1A8, (Series 2003-J1), 5.750%, 3/25/2033	1,051,268	1,069,577
Credit Suisse Mortgage Capital Certificates, Class A1, (Series 2006-TF2A), 3.221%,10/15/2021 (4)(6)(7)	2,271,767	2,193,137
Credit Suisse Mortgage Capital Certificates, Class AM, (Series 2007-C5), 5.869%, 9/15/2040 (4)	6,000,000	5,258,106
Greenwich Capital Commercial Funding Corp., Class A1, (Series 2006-FL4A), 3.231%, 11/5/2021 (4)(6)(7)	1,676,186	1,608,398
Greenwich Capital Commercial Funding Corp., Class AM, (Series 2007-GG11), 5.867%, 12/10/2049 (4)	9,000,000	7,862,598

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Other Financial (continued)
Greenwich Capital Commercial Funding Corp., Class AM, (Series 2007-GG9), 5.475%, 3/10/2039	$    5,000,000	$    4,297,780
GSR Mortgage Loan Trust, Class 2A8, (Series 2005-5F), 5.500%, 6/25/2035	6,000,000	5,877,816
JP Morgan Chase Commercial Mortgage, Class A1, (Series 2007-FL1A), 5.403%, 7/15/2019 (4)(6)(7)	2,649,825	2,544,397
JP Morgan Alternative Loan Trust, Class 12A1, (Series 2007-A2), 3.335%, 6/25/2037 (4)	14,596,251	11,738,393
JP Morgan Mortgage Trust, Class 2A1, (Series 2007-A2), 5.711%, 4/25/2037 (4)	9,996,361	10,029,809
JP Morgan Mortgage Trust, Class 3A3, (Series 2007-A4), 5.883%, 6/25/2037 (4)	11,756,806	11,799,825
JP Morgan Mortgage Trust, Class 4A1, (Series 2007-A2), 6.051%, 4/25/2037 (4)	5,455,675	5,489,642
JP Morgan Mortgage Trust, Class 4A1M, (Series 2007-A2), 5.801%, 4/25/2037 (4)	8,183,512	8,274,226
Lehman Brothers Commercial Mortgage Trust, Class A1, (Series 2007-LLFA), 3.421%, 6/15/2022 (4)(6)(7)	7,258,238	6,983,812
Master Asset Securitization Trust, Class 4A5, (Series 2004-3), 5.000%, 3/25/2034	15,215,000	15,237,791
Merrill Lynch Mortgage Trust, Class A3A, (Series 2005-CIP1), 4.949%, 7/12/2038 (4)	4,000,000	3,888,164
Merrill Lynch/Countrywide Commercial Mortgage Trust, Class A4, (Series 2007-9), 5.700%, 9/12/2049	5,000,000	4,772,575
Morgan Stanley Capital, Class A2A, (Series 2005-HQ6), 4.882%, 8/13/2042	4,000,000	3,948,340
Morgan Stanley Capital, Class A4, (Series 2007-IQ15), 5.882%, 6/11/2049 (4)	6,000,000	5,849,772
Morgan Stanley Capital, Class A4, (Series 2007-IQ16), 5.809%, 12/12/2049	5,000,000	4,804,615
Residential Accredit Loans, Inc., Class A5, (Series 2003-QR24), 4.000%, 7/25/2033	1,957,316	1,899,900
Structured Asset Securities Corporation, Class 2A, (Series 2003-21), 5.250%, 8/25/2033	3,908,777	3,781,574
Thornburg Mortgage Securities Trust, Class A2B, (Series 2007-1), 3.476%, 3/25/2037 (4)	7,077,827	6,813,668

(See Notes which are an integral part of the Financial Statements)

20

February 29, 2008 (Unaudited)

Schedule of Investments

Government Income Fund (continued)

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Other Financial (continued)
TIAA Retail Commercial Trust, Class A3, (Series 2007-C4), 6.097%, 8/15/2039 (4)	$    9,000,000	$    8,931,744
Wachovia Bank Commercial Mortgage Trust, Class AM, (Series 2007-C34), 5.818%, 5/15/2046 (4)	6,000,000	5,212,602
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR7), 5.605%, 5/25/2036 (4)	5,057,333	5,077,117
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR8), 5.240%, 4/25/2036 (4)	3,394,143	3,406,885
		211,012,013
Total Collateralized Mortgage Obligations (identified cost $261,430,517)		253,887,736
Corporate Bonds & Notes — 1.9%
Broker/Dealers — 0.5%
Bear Stearns Co., Inc., 3.429%, 2/1/2012 (4)	4,000,000	3,544,568
Financial Services — 0.3%
SLM Corp., Note, (Series MTNA), 3.471%, 7/27/2009 (4)	2,500,000	2,245,660
Insurance — 0.4%
HSB Capital I, Company Guarantee, (Series B), 5.168%, 7/15/2027 (4)	3,000,000	2,957,247
Real Estate — 0.7%
iStar Financial, Inc., 5.514%, 3/3/2008 (4)	5,000,000	5,000,000
Total Corporate Bonds & Notes (identified cost $14,469,061)		13,747,475
Government Agencies — 2.9%
Federal Home Loan Mortgage Corporation — 1.4%
3.375%, 4/15/2009	10,000,000	10,119,340
Federal National Mortgage Association — 1.5%
4.875%, 4/15/2009	10,000,000	10,283,720
Total Government Agencies (identified cost $19,754,335)		20,403,060
Mortgage-Backed Securities — 62.6%
Federal Home Loan Mortgage Corporation — 4.0%
5.000%, 8/1/2014	2,657,846	2,694,440
5.000%, 5/1/2021 (1)	3,422,039	3,469,599
5.000%, 10/1/2033 (1)	3,137,934	3,104,054
5.000%, 11/1/2035 (1)	10,231,261	10,097,395
5.500%, 11/1/2018	3,494,627	3,587,314
5.500%, 10/1/2021 (1)	4,017,107	4,106,186
6.500%, 9/1/2016	206,818	216,381
7.000%, 11/1/2009	23,331	23,799
7.500%, 9/1/2013	76,410	83,079
7.500%, 4/1/2024	241,357	262,173
7.500%, 4/1/2027	129,570	140,765
8.000%, 8/1/2030	156,603	170,294

Description	Principal Amount	Value
Mortgage-Backed Securities (continued)
Federal Home Loan Mortgage Corporation (continued)
8.500%, 9/1/2024	$       126,980	$       140,896
9.000%, 6/1/2019	193,460	211,869
9.500%, 2/1/2025	124,917	138,471
		28,446,715
Federal National Mortgage Association — 56.6%
5.000%, 5/1/2018	2,269,240	2,304,922
5.000%, 5/1/2020 (1)	4,532,816	4,587,151
5.000%, 7/1/2035 (1)	4,397,216	4,333,417
5.000%, 2/1/2036 (1)	5,953,834	5,867,450
5.000%, 12/1/2036 (1)	31,961,813	31,498,079
5.500%, 8/1/2021 (1)	16,148,630	16,518,821
5.500%, 1/1/2023	2,553,163	2,605,904
5.500%, 10/1/2024 (1)	2,966,209	3,022,867
5.500%, 2/1/2033	1,648,793	1,666,021
5.500%, 6/1/2035 (1)	5,128,804	5,161,772
5.500%, 8/1/2036 (1)	3,543,655	3,566,434
5.500%, 11/1/2036 (1)	25,543,907	25,713,084
5.500%, 12/1/2036 (1)	18,148,827	18,269,027
5.500%, 1/1/2037	1,808,338	1,820,315
5.500%, 5/1/2037 (1)	29,018,415	29,203,059
5.500%, 7/1/2037 (1)	73,567,143	74,040,032
5.500%, 8/1/2037 (1)	19,572,678	19,698,491
5.500%, 8/1/2037 (1)	9,928,060	9,991,877
6.000%, 9/1/2013	819,519	848,853
6.000%, 10/1/2016	555,629	575,606
6.000%, 9/1/2021 (1)	5,195,348	5,370,343
6.000%, 1/1/2036 (1)	1,934,803	1,980,294
6.000%, 3/12/2038 (5)	100,000,000	102,171,899
6.500%, 9/1/2016	351,270	368,957
6.500%, 9/1/2016	710,071	745,823
6.500%, 8/1/2030 (1)	3,854,465	4,031,678
6.500%, 12/1/2031	231,497	241,774
6.500%, 9/1/2037 (1)	19,531,878	20,255,592
6.500%, 11/1/2037 (1)	3,833,617	3,954,794
7.000%, 12/1/2010	48,781	48,864
7.000%, 3/1/2029	319,005	340,688
7.000%, 7/1/2029	840,418	897,542
7.000%, 2/1/2030	756,104	807,496
7.500%, 12/1/2009	156,359	158,231
7.500%, 10/1/2030	129,079	139,576
8.000%, 10/1/2028	1,308,237	1,428,339
8.000%, 4/1/2030	239,100	259,610
		404,494,682
Government National Mortgage Association — 2.0%
5.000%, 4/15/2034	1,987,417	1,994,498
5.500%, 9/15/2033	4,985,565	5,108,639
6.000%, 12/20/2033	5,298,519	5,495,247
6.500%, 9/15/2032	910,903	955,579
7.000%, 6/15/2029	398,915	428,548
7.000%, 8/15/2031	202,064	216,828
8.500%, 6/15/2010	114,689	117,505
9.000%, 11/15/2009	103,251	103,748
9.000%, 1/15/2010	54,109	54,445
9.500%, 10/15/2024	84,498	94,394
		14,569,431
Total Mortgage-Backed Securities (identified cost $438,216,435)		447,510,828
U.S. Treasury Bonds & Notes — 3.6%
2.875%, 1/31/2013 (1)	20,000,000	20,357,820
3.500%, 2/15/2018 (1)	5,000,000	4,989,065
Total U.S. Treasury Bonds & Notes (identified cost $24,799,474)		25,346,885

(See Notes which are an integral part of the Financial Statements)

21

Marshall Funds

Government Income Fund (continued)

Description	Principal Amount	Value
Short-Term Investments — 54.4%
Collateral Pool Investment for Securities on Loan — 48.2% (See Note 2 of the Financial Statements)		$  344,530,509
Repurchase Agreement — 6.2%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $44,117,651 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $45,070,143 (at amortized cost)	$  44,106,441	44,106,441
Total Short-Term Investments (identified cost $388,636,950)		388,636,950
Total Investments — 162.6% (identified cost $1,158,492,078)		1,160,671,064
Other Assets and Liabilities — (62.6)%		(446,895,906	)
Total Net Assets — 100.0%		$713,775,158

Portfolio Sector Allocations*
Sector	Fund
Asset-Backed Securities	1.6%
Collateralized Mortgage Obligations	35.6
Corporate Bonds & Notes	1.9
Government Agencies	2.9
Mortgage-Backed Securities	62.6
U.S. Treasury Bonds & Notes	3.6
Other Assets & Liabilities, Net	(8.2)
Total	100.0%

Intermediate Tax-Free Fund

Description/Credit Ratings (8)	Principal Amount	Value
Municipals — 92.8%
Alaska — 2.3%
Alaska Housing Finance Corporation, (Series 1997 A-1), Mortgage Revenue Bonds, 5.350%, (MBIA Insurance Corp.)/(Not Reoffered), 12/1/2013 AAA/Aaa; Call Date 12/1/2009	$   955,000	$        959,584
Alaska Housing Finance Corporation, (Series 1997 A-1), Mortgage Revenue Bonds, 5.500%, (MBIA Insurance Corp.)/(Original Issue Yield: 5.531%), 12/1/2017 AAA/Aaa; Call Date 12/1/2009	1,000,000	1,004,180
		1,963,764

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Arizona — 2.7%
Maricopa County, AZ, Industrial Development Authority, Catholic Healthcare West Project, (Series 1998 A), Health Facility Revenue Bonds, 5.000%, (Original Issue Yield: 5.25%), 7/1/2016 A/A2; Call Date 7/1/2008	$   100,000	$       100,931
Maricopa County, AZ, School District No. 28 Kyrene Elementary, (Series 2001 A), GO UT, 5.000%, (MBIA Insurance Corp.)/(Original Issue Yield: 4.59%), 7/1/2013 NR/Aaa	700,000	745,304
Maricopa County, AZ, Sun Health Corporation Hospital Revenue Bonds, (Series 2005), 5.000%, (Original Issue Yield: 4.46%), 4/1/2016 BBB/Baa1; Call Date 4/1/2015	550,000	542,091
Phoenix, AZ, Civic Improvement Corp., Jr. Lien Water System Revenue Refunding Construction Bonds, 5.250%, (FGIC)/(Original Issue Yield: 4.69%), 7/1/2016 AA/Aa3	500,000	537,615
Pima County, AZ, (Series 2008), Street and Highway Revenue Bonds, 4.125%, (Original Issue Yield: 4.30%), 7/1/2022 AA/A1; Call Date 7/1/2018	250,000	218,588
Tempe, AZ, (Series 2007), Excise Tax Revenue Refunding Obligations, 4.500%, (Original Issue Yield: 4.31%), 7/1/2021 AAA/Aa2; Call Date 7/1/2017	100,000	95,466
		2,239,995
California — 9.9%
ABC Unified School District, CA, Los Angeles County, (Series 2003 A), GO UT Refunding Bonds, 5.000%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2021 AAA/Aaa	1,000,000	929,840
California Statewide Communities Development Authority, Revenue Bonds, John Muir Health, (Series 2006 A), 5.000%, (Original Issue Yield: 4.61%), 8/15/2021 A+/A1; Call Date 8/15/2016	130,000	128,618
Centinela Valley Union High School District, CA, Los Angeles County, (Series 2002 A), GO UT Refunding Bonds, 5.000%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2019 AAA/Aaa	100,000	96,650
Delano Joint Union High School District, CA, Kern and Tulare Counties, (Series 2003 A), GO UT Refunding Bonds, 5.100%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2022 AAA/Aaa	200,000	187,840

(See Notes which are an integral part of the Financial Statements)

22

February 29, 2008 (Unaudited)

Schedule of Investments

Intermediate Tax-Free Fund (continued)

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
California (continued)
Fresno Unified School District, CA, Fresno County, (Series 2002 A), GO UT Refunding Bonds, 6.000%, (MBIA Insurance Corp.)/(Not Reoffered), 8/1/2015 AAA/Aaa	$   100,000	$       109,288
Fresno Unified School District, CA, Fresno County, (Series 2004 B), GO UT Refunding Bonds, 4.600%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2016 AAA/Aaa	400,000	395,288
Oxnard School District, CA, Ventura County, (Series 2001 A), GO UT Refunding Bonds, 5.750%, (MBIA Insurance Corp.)/(Not Reoffered), 8/1/2022 AAA/Aaa; Call Date 2/1/2022	715,000	735,721
Sierra View Local Health Care District Revenue Bonds, 4.700%, (Original Issue Yield: 4.74%), 7/1/2016 NR/NR	250,000	249,643
Sierra View Local Health Care District Revenue Bonds, 5.250%, (Original Issue Yield: 5.28%), 7/1/2022 NR/NR; Call Date 7/1/2017	1,000,000	963,849
Sierra View Local Health Care District Revenue Bonds, 5.250%, (Original Issue Yield: 5.32%), 7/1/2023 NR/NR; Call Date 7/1/2017	250,000	238,830
Sierra View Local Health Care District Revenue Bonds, 5.300%, (Original Issue Yield: 5.38%), 7/1/2026 NR/NR; Call Date 7/1/2017	1,000,000	928,940
State of California, GO UT Refunding Bonds, 5.000%, (Original Issue Yield: 3.72%), 9/1/2012 A+/A1	2,000,000	2,114,239
Sweetwater Union High School District, CA, San Diego County, (Series 2005), Refinancing Certificates of Participation, 4.000%, (MBIA Insurance Corp.)/(Original Issue Yield: 4.21%), 9/1/2016 AAA/Aaa; Call Date 9/1/2015	500,000	474,470
Vallejo City Unified School District, CA, Solano County, (Series 2002 A), GO UT Refunding Bonds, 4.800%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2012 AAA/Aaa	150,000	154,458
Vallejo City Unified School District, CA, Solano County, (Series 2002 A), GO UT Refunding Bonds, 5.400%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2015 AAA/Aaa	50,000	52,404
Vallejo City Unified School District, CA, Solano County, (Series 2002 A), GO UT Refunding Bonds, 5.900%, (MBIA Insurance Corp.)/(Not Reoffered), 2/1/2018 AAA/Aaa	250,000	263,065

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
California (continued)
Vallejo City Unified School District, CA, Solano County, (Series 2002 A), GO UT Refunding Bonds, 5.900%, (MBIA Insurance Corp.)/(Not Reoffered), 8/1/2018 AAA/Aaa	$   350,000	$       367,469
		8,390,612
Colorado — 5.7%
Arkansas River Power Authority, CO, Power Revenue Improvement Bonds, (Series 2007), Revenue Bonds, 5.000%, (XL Capital Assurance, Inc.)/(Original Issue Yield: 4.80%), 10/1/2043 A-/A3; Call Date 10/1/2017	420,000	358,579
Broomfield, CO, Interlocken Consolidated Metropolitan District, (Series 1999 B), General Obligation Refunding and Improvement Bonds, 5.750%, (Asset Guaranty Insurance Company)/(Original Issue Yield: 6.05%), 12/15/2019 AA/NR; Call Date 12/15/2009	500,000	511,525
Colorado Health Facilities Authority, Longmont United Hospital Project, (Series 2003), Revenue Refunding Bonds, 3.375%, (ACA Insurance Corp.)/(Original Issue Yield: 3.50%), 12/1/2009 NR/Baa2	60,000	59,057
Colorado Health Facilities Authority, Longmont United Hospital Project, (Series 2003), Revenue Refunding Bonds, 4.100%, (ACA Insurance Corp.)/(Original Issue Yield: 4.20%), 12/1/2012 NR/Baa2	50,000	48,633
Colorado Health Facilities Authority, Longmont United Hospital Project, (Series 2003), Revenue Refunding Bonds, 4.500%, (ACA Insurance Corp.)/(Original Issue Yield: 4.66%), 12/1/2016 NR/Baa2	100,000	95,262
El Paso County, CO, School District No. 49 Falcon, GO UT, (Series 2002), 5.750%, (FGIC State Aid Withholding)/(Original Issue Yield: 4.75%), 12/1/2013 AA-/Aa3; (Prerefunded 12/1/2011)	1,875,000	2,047,650
Pueblo County, CO, Pueblo City-County Library District, (Series 2007), Certificates of Participation, 5.250%, (AMBAC INS)/(Original Issue Yield: 4.25%), 12/1/2024, AAA/Aaa; Call Date 12/1/2012	100,000	97,599
University of Northern Colorado, Auxiliary Facilities System Revenue Refunding & Improvement Bonds, (Series 2005), 5.000%, (FSA Insurance Corp.)/(Original Issue Yield: 3.88%), 6/1/2017 AAA/Aaa; Call Date 6/1/2015	1,445,000	1,533,087
		4,751,392

(See Notes which are an integral part of the Financial Statements)

23

Marshall Funds

Intermediate Tax-Free Fund (continued)

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Connecticut — 0.1%
State of Connecticut Health and Educational Facilities Authority, Waterbury Hospital Issue Revenue Bonds, (Series C), 6.125%, (Radian Ins.)/(Original Issue Yield: 5.65%), 7/1/2014 AA/NR; Call Date 7/1/2009	$   100,000	$       103,299
District of Columbia — 0.4%
District of Columbia Housing Finance Agency, DC, Housing Authority Modernization Program, (Series 2005), Revenue Bonds, 5.000%, (FSA Insurance Corp.)/(Original Issue Yield: 4.11%), 7/1/2017 AAA/Aaa; Call Date 7/1/2015	200,000	203,916
District of Columbia Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed Revenue Bonds, (Series 2001), 6.250%, (Original Issue Yield: 6.375%), 5/15/2024 BBB/Baa3; Call Date 5/15/2011	140,000	141,112
		345,028
Florida — 2.4%
State of Florida Board of Education, Lottery Revenue Bonds, (Series 2002 A), 5.000%, (FGIC)/(Original Issue Yield: 5.06%), 7/1/2019 AAA/A2; Call Date 7/1/2012	2,000,000	2,029,720
Georgia — 1.3%
Georgia Municipal Electric Authority, Project One Subordinated Revenue Bonds, (Series 1998 A), 5.250%, (MBIA Insurance Corp.)/(Original Issue Yield: 4.70%), 1/1/2014 AAA/Aaa	1,000,000	1,068,580
Illinois — 7.4%
Illinois Finance Authority, Community Rehabilitation Providers Facilities Acquisition Program, Refunding and New Money Revenue Bonds, (Series 2007 A), 5.000%, (Original Issue Yield: 5.00%), 7/1/2016 BBB/NR; Call Date 7/1/2014	730,000	724,072
Illinois Finance Authority, Roosevelt University Project, (Series 2007), Revenue Bonds, 5.125%, (Original Issue Yield: 5.04%), 4/1/2020 NR/Baa1; Call Date 4/1/2017	350,000	329,536
Illinois Health Facilities Authority, Thorek Hospital and Medical Center, (Series 1998), Revenue Refunding Bonds, 5.250%, (Original Issue Yield: 5.40%), 8/15/2018 A-/NR; Call Date 8/15/2008	350,000	344,743

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Illinois (continued)
Illinois Health Facilities Authority, Thorek Hospital and Medical Center, (Series 1998), Revenue Refunding Bonds, 5.375%, (Original Issue Yield: 5.50%), 8/15/2028 A-/NR; Call Date 8/15/2008	$1,000,000	$       910,440
Illinois Housing Development Authority, Evergreen Place-Streator Housing Revenue Bonds, (Series 2007 G), 4.700%, (FGIC)/(Original Issue Yield: 4.699%), 7/1/2017 A+/A1 (9)	250,000	235,620
Kendall, Kane & Will Counties, IL, Community Unit School District No. 308, GO UT, (Series 2004), 5.250%, (FSA Insurance Corp.)/(Original Issue Yield: 4.38%), 10/1/2016 NR/Aaa; Call Date 10/1/2014	1,125,000	1,206,877
School District Number 51, Tazewell County, Illinois, (Washington Central) GO UT School Bonds, (Series 2007), 9.000%, (FGIC)/(Original Issue Yield: 4.85%), 12/1/2025 NR/A3	40,000	55,613
State of Illinois Revenue Bonds, (Series A), 5.250%, (Original Issue Yield: 4.52%), 2/1/2019 A+/Aaa; Call Date 2/1/2017	1,000,000	1,034,450
State of Illinois, Illinois First Fund for Infrastructure, Roads, Schools & Transit, GO UT (Series of February 2002), 5.500%, (FGIC)/(Original Issue Yield: 4.99%), 2/1/2018 AA/Aa3; Call Date 2/1/2012	200,000	210,518
University of Illinois, Auxiliary Facilities System Revenue Refunding Bonds, (Series 2001 A), 5.250%, (AMBAC INS)/(Original Issue Yield: 4.53%), 4/1/2013 AAA/Aaa	1,060,000	1,134,305
		6,186,174
Indiana — 0.6%
Vinton-Tecumseh School Building Corporation, IN, Tippecanoe County, (Series 2007), First Mortgage Refunding Bonds, 4.000%, (FSA Insurance Corp.)/(Original Issue Yield: 4.00%), 7/15/2018 AAA/NR	500,000	483,410
Iowa — 0.3%
Polk County, Iowa General Obligation Capital Loan Notes, (Series 2004 B), 5.250%, (Original Issue Yield: 5.25%), 6/1/2020 AAA/Aa2; Call Date 6/1/2014 (9)	235,000	238,979

(See Notes which are an integral part of the Financial Statements)

24

February 29, 2008 (Unaudited)

Schedule of Investments

Intermediate Tax-Free Fund (continued)

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Kansas — 4.8%
Olathe, KS, Olathe Medical Center, (Series 2008 A), Health Facilities Revenue Bonds, 4.125%, (Original Issue Yield: 3.85%)/(Mandatory Tender 3/1/2013), 9/1/2037 A+/NR; Call Date 3/1/2012	$   975,000	$       969,569
Sedgwick County, Kansas and Shawnee County, Kansas Mortgage-Backed Securities Program, Single Family Mortgage Revenue Bonds, (Series 2002 B-5), (AMT) 5.450%, (GNMA/FNMA Coll)/(Original Issue Yield: 5.45%), 6/1/2027 NR/Aaa; Call Date 6/1/2013 (9)	1,230,000	1,262,066
Sedgwick County, Kansas and Shawnee County, Kansas Mortgage-Backed Securities Program, Single Family Mortgage Revenue Bonds, (Series 2005 A-1), (AMT) 5.650%, (GNMA/FNMA Coll)/(Original Issue Yield: 5.025%), 12/1/2036 NR/Aaa; Call Date 12/1/2014 (9)	1,315,000	1,355,962
Sedgwick County, Kansas and Shawnee County, Kansas Mortgage-Backed Securities Program, Single Family Mortgage Revenue Bonds, (Series 2006 B-3), (AMT) 5.250%, (GNMA/FNMA Coll)/(Original Issue Yield: 4.44%), 12/1/2038 NR/Aaa; Call Date 12/1/2016 (9)	430,000	440,643
		4,028,240
Kentucky — 0.3%
Kentucky State Property & Building Commission Revenue Refunding Bonds, 5.000%, (MBIA)/(Original Issue Yield: 3.95%), 8/1/2018 AAA/Aaa	275,000	286,083
Louisiana — 3.9%
Jefferson Parish, LA, Finance Authority, Single Family Mortgage Revenue Bonds, (Series 2006 D), 4.000%, (GNMA/FNMA/FHLMC)/(Original Issue Yield: 4.00%), 12/1/2023 NR/Aaa; Call Date 12/1/2016	250,000	247,948
Jefferson Parish, LA, Finance Authority, Single Family Mortgage Revenue Bonds, (Series 2007 C), 5.700%, (Original Issue Yield: 4.714%), 6/1/2039 NR/Aaa; Call Date 6/1/2017	500,000	525,600
New Orleans Aviation Board, LA, Passenger Facility Charge Projects, (Series 2007 B-2), Revenue Refunding Bonds, 5.250%, (FSA Insurance Corp.)/(Original Issue Yield: 4.81%), 1/1/2019 AAA/NR; Call Date 1/1/2018 (9)	645,000	665,943

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Louisiana (continued)
St. Bernard Parish, LA, Home Mortgage Authority, Mortgage-Backed Securities Program, (Series 2007 A-1), Single Family Mortgage Revenue Bonds, 5.800%, (Original Issue Yield: 5.207%), 3/1/2039 NR/Aaa; Call Date 9/1/2017	$1,000,000	$    1,049,830
State of Louisiana, GO UT Match Bonds, (Series 2006 B), 5.000%, (CIFG INS)/(Original Issue Yield: 4.38%), 7/15/2017 A+/A1; Call Date 7/15/2016	750,000	780,090
		3,269,411
Michigan — 2.6%
Lakeview Public Schools, MI, Macomb County, (Series 2008), GO UT School Building and Site Bonds, 4.000%, (FSA Insurance Corp.)/(Original Issue Yield: 3.95%), 5/1/2018 AAA/Aaa	120,000	117,251
Michigan State Hospital Finance Authority, Marquette General Hospital Obligated Group, Hospital Revenue Bonds, (Series 2005 A), 5.000%, (Original Issue Yield: 3.92%), 5/15/2011 NR/Baa1	310,000	313,348
Michigan State Strategic Fund, Ltd., Oblig. Revenue Refunding Bonds, (OBG-DOW Chemical Project), (Series 2003), 4.600%, (Original Issue Yield: 4.599%), 6/1/2014 A-/A-2/A3/P-2	1,750,000	1,752,712
		2,183,311
Mississippi — 1.3%
Rankin County, MS, School District, GO UT Refunding Bonds, 5.000%, (FSA INS)/(Original Issue Yield: 3.98%), 10/1/2014 AAA/Aaa	1,000,000	1,075,810
Missouri — 4.0%
Arnold, MO, Missouri Development Finance Board, Road Infrastructure Project, (Series 2007 B), Infrastructure Facilities Revenue Bonds, 5.000%, (Original Issue Yield: 5.04%), 11/1/2027 A/NR; Call Date 11/1/2009	1,000,000	901,560
Cass County, MO, Hospital Revenue Bonds, (Series 2007), 5.000%, (Original Issue Yield: 4.80%), 5/1/2015 NR/NR	500,000	491,710
Independence, MO, Missouri Development Finance Board, Crackerneck Creek Project, (Series 2008 B), Infrastructure Facilities Revenue Bonds, 4.250%, (Original Issue Yield: 4.49%), 3/1/2019 A+/NR; Call Date 3/1/2018	1,100,000	985,875

(See Notes which are an integral part of the Financial Statements)

25

Marshall Funds

Intermediate Tax-Free Fund (continued)

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Missouri (continued)
Missouri Housing Development Commission, Homeownership Loan Program, (Series 1997 B-2), Single Family Mortgage Revenue Bonds, 6.850%, (GNMA/FNMA Coll)/(Original Issue Yield: 5.849%), 3/1/2028 AAA/NR; (Continuously Callable) (9)	$   500,000	$       517,360
Riverside, MO, Industrial Development Authority, Riverside Horizons Infrastructure Project, (Series 2007 A), Industrial Development Revenue Bonds, 4.500%, (ACA Capital Holdings, Inc.)/(Original Issue Yield: 4.10%), 5/1/2011 A/NR	500,000	495,770
		3,392,275
Nebraska — 0.4%
O’Neill, NE, Averna St. Anthony Hospital Project, (Series 2000), Health Care Facilities Development Revenue Bonds, 6.250%, (Original Issue Yield: 6.249%), 9/1/2012 NR/NR	300,000	305,400
Nevada — 1.6%
Nevada Housing Division, (Series 2000 B-2), Single Family Mortgage Revenue Bonds, 5.550%, (Original Issue Yield: 5.549%), 4/1/2031, AAA/Aaa; Call Date 10/1/2009 (9)	465,000	465,386
Nevada Housing Division, (Series 2000 C-2), Single Family Mortgage Revenue Bonds, 5.400%, (Original Issue Yield: 5.40%), 4/1/2031, AAA/Aaa; Call Date 4/1/2010 (9)	365,000	366,902
Reno-Sparks Indian Colony, (Series 2006), Governmental Revenue Bonds, 4.250%, (Original Issue Yield: 4.44%), 6/1/2014 NR/NR	515,000	497,109
		1,329,397
New Hampshire — 0.1%
New Hampshire Health and Education Facilities Authority, New Hampshire College Issue Revenue Bonds, (Series 2000), 7.000%, (Original Issue Yield: 6.999%), 1/1/2015 BBB-/NR; Call Date 1/1/2011	100,000	105,362
New Jersey — 1.7%
City of Hackensack, Bergen County, NJ, GO UT General Improvement Serial Bonds, 4.000%, (FSA Insurance Corp.)/(Original Issue Yield: 3.90%), 1/15/2020 AAA/Aaa; Call Date 1/15/2017	1,510,000	1,411,654

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
New York — 3.7%
Metropolitan Transit Authority, NY, Transportation Revenue Bonds, (Series 2006 B), 5.000%, (FSA Insurance Corp.)/(Original Issue Yield: 3.87%), 11/15/2016 A/A2	$1,500,000	$    1,574,295
New York St Dorm Authority Health Quest Systems Revenue Bonds, (Series 2007 B), 5.000%, (GTY)/(Original Issue Yield: 4.50%), 7/1/2016 AAA/Aaa	250,000	267,170
Oswego County, NY, GO UT, 6.700%, (Original Issue Yield: 6.80%), 6/15/2011 (Econ Defeased to Maturity), NR/A2	1,100,000	1,223,541
		3,065,006
North Dakota — 6.0%
Fargo, ND, Health System Revenue Bonds, (Meritcare), (Series 2000 A), 5.750%, (FSA Insurance Corp.)/(Original Issue Yield: 5.30%), 6/1/2012 AAA/Aaa; Call Date 6/1/2010	2,940,000	3,114,813
Fargo, ND, Public School District No. 1, School Building GO UT, 4.625%, (Original Issue Yield: 4.85%), 5/1/2026 NR/A1; Call Date 5/1/2016	300,000	262,875
North Dakota State Water Commission, Water Development and Management Program Revenue Bonds, (Series 2000 A), 6.000%, (MBIA Insurance Corp.)/(Original Issue Yield: 5.39%), 8/1/2011 (Prerefunded 8/1/2010) AAA/Aaa; Call Date 8/1/2010	1,545,000	1,656,209
		5,033,897
Ohio — 2.8%
Columbus, OH, GO UT, (Series 2002-1), 5.000%, (Original Issue Yield: 4.05%), 11/15/2015 AAA/Aaa; Call Date 11/15/2012	2,115,000	2,229,590
Olentangy, OH, Local School District, (Series 2004 B), GO UT, Refunding Bonds, 5.500%, (FGIC)/(Original Issue Yield: 4.48%), 12/1/2016 AA/Aa2; Call Date 6/1/2014	150,000	161,705
		2,391,295
Oregon — 1.1%
Jackson County, OR, Airport Revenue Bonds, (Series 2007 B), 5.125%, (XLCA)/(Original Issue Yield: 4.77%), 12/1/2023 A-/A3; Call Date 12/1/2012 (9)	1,000,000	934,080

(See Notes which are an integral part of the Financial Statements)

26

February 29, 2008 (Unaudited)

Schedule of Investments

Intermediate Tax-Free Fund (continued)

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Pennsylvania — 2.6%
Pennsylvania State Industrial Development Authority Economic Development Revenue Bonds, 5.500%, (AMBAC INS)/(Original Issue Yield: 4.52%), 7/1/2014 AAA/Aaa; Call Date 7/1/2012	$2,000,000	$    2,150,400
Puerto Rico — 0.3%
Puerto Rico Housing Finance Authority, (Series 2003 A), Home Mortgage Revenue Bonds, 3.125%, (GNMA/FNMA/FHLMC Coll)/(Original Issue Yield: 3.125%), 12/1/2033 AAA/Aaa; Call Date 6/1/2013 (9)	265,000	262,729
South Dakota — 1.2%
South Dakota Health and Educational Facilities Authority, (Series 2007), Vocational Education Program Revenue Refunding Bonds, 5.000%, (AMBAC INS)/(Original Issue Yield: 4.20%), 8/1/2022 AAA/Aaa; Call Date 8/1/2017	980,000	977,962
Tennessee — 2.2%
Putnam County, TN, GO UT School Refunding Bonds, (Series 2001), 5.250%, (FGIC)/(Original Issue Yield: 4.53%), 4/1/2013 NR/A1	450,000	483,053
The Health, Educational and Housing Facilities Board of the County of Sumner, Tennessee, Sumner Regional Health Systems, Inc., Hospital Revenue, Refunding and Improvement Bonds, (Series 2007 A), 5.250%, (Original Issue Yield: 4.70%), 11/1/2013 NR/NR	535,000	544,907
The Tennessee Energy Acquisition Corporation, (Series 2006 A), Gas Project Revenue Bonds, 5.000%, (Original Issue Yield: 4.25%), 9/1/2012 AA-/Aa3	200,000	203,698
The Tennessee Energy Acquisition Corporation, (Series 2006 C), Gas Project Revenue Bonds, 5.000%, (Original Issue Yield: 3.75%), 2/1/2012 AA-/Aa3	175,000	178,157
The Tennessee Energy Acquisition Corporation, (Series 2006 C), Gas Project Revenue Bonds, 5.000%, (Original Issue Yield: 4.20%), 2/1/2023 AA-/Aa3	450,000	417,011
		1,826,826
Texas — 4.8%
Conroe, TX, Montgomery County, (Series 2007), Certificates of Obligation, 5.500%, (MBIA Insurance Corp.)/(Original Issue Yield: 4.55%), 3/1/2022 AAA/Aaa; Call Date 3/1/2017	300,000	315,408

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Texas (continued)
League City, TX, Galveston County, (Series 2008), Waterworks and Sewer System Revenue Bonds, 4.250%, (FSA Insurance Corp.)/(Original Issue Yield: 4.36%), 2/15/2021 AAA/Aaa; Call Date 2/15/2017	$   290,000	$       274,520
Lufkin, TX, Health Facilities Development Corporation, Memorial Health System of East Texas, (Series 2007), Health System Revenue Bonds, 4.750%, (Original Issue Yield: 5.00%), 2/15/2017 BBB+/Baa2	325,000	314,636
Lufkin, TX, Health Facilities Development Corporation, Memorial Health System of East Texas, (Series 2007), Health System Revenue Bonds, 5.250%, (Original Issue Yield: 5.40%), 2/15/2027 BBB+/Baa2; Call Date 2/15/2017	175,000	158,968
Sam Rayburn, TX, Municipal Power Agency, (Series 2002), Power Supply System Revenue Refunding Bonds, 5.750%, (Asset Guaranty Ins.)/(Original Issue Yield: 5.45%), 10/1/2021 AA/Aa3; Call Date 10/1/2012	865,000	876,383
San Antonio, TX, Electricity and Gas System Revenue Refunding Bonds, (Series 2005), 5.000%, (Original Issue Yield: 4.15%), 2/1/2019 AA/Aa1; Call Date 2/1/2015	2,000,000	2,057,520
		3,997,435
Utah — 0.6%
Utah Housing Corporation, (Series 2007 G), Single Family Mortgage Bonds, 5.250%, (Original Issue Yield: 5.249%), 1/1/2039 AAA/Aaa; Call Date 1/1/2016 (9)	300,000	271,548
Utah State Charter School Finance Authority, Summit Academy, (Series 2007 A), Charter School Revenue Bonds, 5.125%, (Original Issue Yield: 5.125%), 6/15/2017 BBB-/NR	250,000	242,355
		513,903
Virginia — 5.6%
State of Virginia Public School Authority, School Educational Technology Notes, (Series VIII), 5.000%, (Original Issue Yield: 3.65%), 4/15/2012 AA+/Aa1	3,000,000	3,200,400

(See Notes which are an integral part of the Financial Statements)

27

Marshall Funds

Intermediate Tax-Free Fund (continued)

Description/Credit Ratings (8)	Principal Amount	Value
Municipals (continued)
Virginia (continued)
Suffolk, VA, Redevelopment & Housing Authority, Multi Family Housing Revenue Refunding Bonds (Windsor at Potomac Vista Limited Partnership Project), 4.850%, (Fannie Mae-Standby Liq Fac)/(Original Issue Yield: 4.85%)/(Mandatory Tender 7/1/2011), 7/1/2031 NR/Aaa	$1,500,000	$    1,521,390
		4,721,790
Washington — 2.4%
Port Longview, WA, Industrial Development Corp., Solid Waste Disposal Revenue Bonds, (Weyerhaeuser Co. Project Series 1992), 6.875%, (Original Issue Yield: 6.874%), 10/1/2008 BBB/NR (9)	1,000,000	1,015,490
Washington Health Care Facilities Authority, MultiCare Health System, (Series 2007 B), Revenue Bonds, 15.000%, (FSA Insurance Corp.), 8/15/2041 AAA/Aaa	1,000,000	1,000,000
		2,015,490
West Virginia — 1.2%
West Virginia State Hospital Finance Authority, Hospital Revenue Bonds, United Hospital Center, Inc. Project (Series A), (AMBAC INS), 5.000%, (Original Issue Yield: 4.38%), 6/1/2018 AAA/Aaa; Call Date 6/1/2016	1,000,000	1,029,180
Wisconsin — 4.5%
Badger Tobacco Asset Securitization Corporation, Tobacco Settlement Asset-Backed Revenue Bonds, 6.000%, (Original Issue Yield: 6.125%), 6/1/2017 BBB/Baa3; Call Date 6/1/2012	265,000	267,631
City of Kaukauna, Outagamie County, WI Bond Anticipation Notes, 4.000%, (Original Issue Yield: 3.45%), 8/1/2008 NR/MIG-1; (Continuously Callable)	300,000	301,458
Wisconsin Health and Educational Facilities Authority Wheaton Franciscan Healthcare System Revenue Bonds, (Series 2006 A), 5.000%, (Original Issue Yield: 4.17%), 8/15/2014 A-/Baa1	500,000	496,455

Description/Credit Ratings (8)	Shares or Principal Amount	Value
Municipals (continued)
Wisconsin (continued)
Wisconsin Housing and Economic Development Authority, Home Ownership Revenue Bonds, (Series 2001 B), (AMT) 4.850%, (Original Issue Yield: 4.85%), 9/1/2031 AA/Aa2; Call Date 6/1/2011 (9)	$   880,000	$     883,150
Wisconsin State, GO UT, (Series C), 6.000%, (Original Issue Yield: 5.75%), 5/1/2014, (Prerefunded 5/1/2010), AA-/Aa3; Call Date 5/1/2010	1,750,000	1,865,133
		3,813,827
Total Municipals (identified cost $78,625,413)		77,921,716
Mutual Funds — 3.9%
Marshall Tax-Free Money Market Fund Class I	3,265,932	3,265,932
Total Mutual Funds
(identified cost $3,265,932)		3,265,932
Total Investments — 96.7%
(identified cost $81,891,345)		81,187,648
Other Assets and Liabilities — 3.3%		2,733,572
Total Net Assets — 100.0%		$83,921,220

Portfolio Sector Allocations*
Sector	Fund
AAA	37.9%
AA	16.0
A	15.3
BBB	4.8
NR	18.8
Other Assets & Liabilities, Net	7.2
Total	100.0%

Short-Intermediate Bond Fund

Description	Principal Amount	Value
Asset-Backed Securities — 1.1%
Other Financial — 1.1%
Chase Issuance Trust, Class A, (Series 2007-A15), 4.960%, 9/17/2012	$  4,000,000	$     4,138,692
Green Tree Home Improvement Loan Trust, Class HEB1, (Series 1998-B), 7.810%, 11/15/2029	1,176,274	1,178,312
Structured Asset Securities Corp. Trust, Class A2, (Series 2004-16XS), 4.910%, 8/25/2034 (4)	202,939	202,542
Total Asset-Backed Securities (identified cost $5,381,465)		5,519,546

(See Notes which are an integral part of the Financial Statements)

28

February 29, 2008 (Unaudited)

Schedule of Investments

Short-Intermediate Bond Fund (continued)

Description	Principal Amount	Value
Collateralized Mortgage Obligations — 30.4%
Federal Home Loan Mortgage Corporation — 2.8%
5.000%, 10/15/2029, (Series 2745-AY) (1)	$     605,000	$       618,190
5.500%, 7/15/2032, (Series 2686-MH) (1)	10,000,000	10,218,570
5.500%, 10/15/2035, (Series 3058-WC) (1)	2,829,634	2,856,696
		13,693,456
Federal National Mortgage Association — 0.3%
5.500%, 11/25/2035, (Series 2005-100-DA) (1)	1,461,557	1,450,347
Other Financial — 27.3%
Banc of America Funding Corp., Class 1A3, (Series 2007-C), 5.760%, 5/20/2036 (4)	8,157,608	8,171,460
Bear Stearns Commercial Mortgage Securities, Class AM, (Series 2007-PW17), 5.915%, 6/11/2050 (4)	4,000,000	3,518,360
Chase Mortgage Finance Corp., Class 11A1, (Series 2007-A1), 5.679%, 3/25/2037 (4)	13,620,606	13,809,142
Chase Mortgage Finance Corp., Class 7A1, (Series 2007-A2), 5.890%, 7/25/2037 (4)	3,630,103	3,643,200
Credit Suisse Mortgage Capital Certificates, Class AM, (Series 2007-C5), 5.869%, 9/15/2040 (4)	6,000,000	5,258,106
CS First Boston Mortgage Securities Corp., Class 1A3, (Series 2003-11), 4.500%, 6/25/2033	1,298,858	1,297,029
Greenwich Capital Commercial Funding Corp., Class AM, (Series 2007-GG9), 5.475%, 3/10/2039	4,000,000	3,438,224
Greenwich Capital Commercial Funding Corp., Class AM, (Series 2007-GG11), 5.867%, 12/10/2049 (4)	7,000,000	6,115,354
GSR Mortgage Loan Trust, Class 2A8, (Series 2005-5F), 5.500%, 6/25/2035	4,000,000	3,918,544
JP Morgan Alternative Loan Trust, Class 12A1, (Series 2007-A2), 3.335%, 6/25/2037 (4)	7,298,126	5,869,196
JP Morgan Chase Commercial Mortgage Securities Corp., Class A1, (Series 2007-FL1A), 3.496%, 7/15/2019 (4)(6)	3,533,100	3,392,529
JP Morgan Mortgage Trust, Class 2A1, (Series 2006-A3), 5.620%, 5/25/2036 (4)	4,983,302	5,020,931
JP Morgan Mortgage Trust, Class 2A1, (Series 2007-A2), 5.711%, 4/25/2037 (4)	6,664,241	6,686,539
JP Morgan Mortgage Trust, Class 3A3, (Series 2007-A4), 5.883%, 6/25/2037 (4)	7,608,274	7,636,112

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Other Financial (continued)
JP Morgan Mortgage Trust, Class 4A1, (Series 2007-A2), 6.051%, 4/25/2037 (4)	$  6,364,954	$    6,404,582
JP Morgan Mortgage Trust, Class 4A1M, (Series 2007-A2), 5.801%, 4/25/2037 (4)	8,183,512	8,274,226
Lehman Brothers Commercial Mortgage Trust, Class A1, (Series 2007-LLFA), 3.421%, 6/15/2022 (4)(6)	6,350,958	6,110,835
Merrill Lynch/Countrywide Commercial Mortgage Trust, Class A4, (Series 2007-9), 5.700%, 9/12/2049	6,000,000	5,727,090
Morgan Stanley Capital, Class A2A, (Series 2005-HQ6), 4.882%, 8/13/2042	6,675,000	6,588,792
PHH Alternative Mortgage Trust, Class 1A1, (Series 2007-2), 3.245%, 5/25/2037 (4)	4,591,395	4,285,310
Prudential Home Mortgage Securities, Class 2B, (Series 1993-H), 6.980%, 9/28/2008 (4)(6)	2,519	2,512
Residential Accredit Loans, Inc., Class A5, (Series 2003-QR24), 4.000%, 7/25/2033	1,957,316	1,899,901
TIAA Retail Commercial Trust, Class A3, (Series 2007-C4), 6.096%, 8/15/2039 (4)	6,000,000	5,954,496
Wachovia Bank Commercial Mortgage Trust, Class AM, (Series 2007-C34), 5.818%, 5/15/2046 (4)	5,000,000	4,343,835
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR7), 5.605%, 5/25/2036 (4)	3,435,688	3,449,129
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR8), 5.241%, 4/25/2036 (4)	3,394,143	3,406,885
		134,222,319
Total Collateralized Mortgage Obligations (identified cost $154,205,055)		149,366,122
Corporate Bonds & Notes — 41.8%
Automotive & Related — 1.4%
DaimlerChrysler North America Holding Corp., Company Guarantee, 4.050%, 6/4/2008	7,000,000	7,008,498
Banks — 10.6%
Bank of America Corp., 5.750%, 12/1/2017 (1)	6,000,000	6,142,890
Citicorp, Sub. Note, (Series MTNF), 6.375%, 11/15/2008	7,000,000	7,142,807
HBOS Treasury Services PLC, 5.625%, 7/20/2009 (6)	15,000,000	15,521,400
NationsBank Corp., Sub. Note, 7.800%, 9/15/2016	2,000,000	2,301,002

(See Notes which are an integral part of the Financial Statements)

29

Marshall Funds

Short-Intermediate Bond Fund (continued)

Description	Principal Amount	Value
Corporate Bonds & Notes (continued)
Banks (continued)
Northern Rock PLC, Sub. Note, (Series 144A), 6.594%, 6/29/2049 (4)(6)	$  5,000,000	$    3,375,000
U.S. Bank NA, Sr. Note, (Series BKNT), 4.400%, 8/15/2008	10,000,000	10,036,190
UBS Preferred Funding Trust I, 8.622%, 10/29/2049 (4)	7,000,000	7,711,340
		52,230,629
Broker/Dealers — 10.9%
Bear Stearns Co., Inc., 3.250%, 3/25/2009 (1)	10,000,000	9,834,220
Bear Stearns Co., Inc., 5.350%, 2/1/2012	5,000,000	4,927,480
Bear Stearns Co., Inc., 7.250%, 2/1/2018	3,000,000	2,915,580
Citigroup, Inc., 5.300%, 10/17/2012	4,000,000	4,121,248
Goldman Sachs Group, Inc., 5.450%, 11/1/2012	3,000,000	3,143,664
Goldman Sachs Group, Inc., 5.950%, 1/18/2018	4,000,000	4,048,848
JP Morgan Chase & Co., 5.375%, 10/1/2012	4,000,000	4,205,280
Lehman Brothers Holdings, 6.500%, 7/19/2017	4,000,000	3,960,868
Lehman Brothers Holdings, (Series MTN), 6.000%, 7/19/2012	6,000,000	6,174,060
Morgan Stanley, 3.875%, 1/15/2009	10,000,000	9,997,640
		53,328,888
Construction Equipment — 1.6%
CRH America, Inc., 6.000%, 9/30/2016 (1)	4,000,000	3,861,032
CRH America, Inc., Note, 6.950%, 3/15/2012	4,000,000	4,252,100
		8,113,132
Energy — 0.7%
XTO Energy, Inc., 6.250%, 8/1/2017	3,000,000	3,207,630
Financial Services — 8.6%
American General Finance Corp., Note, (Series G), 5.375%, 10/1/2012	2,500,000	2,510,118
Countrywide Financial Corp., 5.800%, 6/7/2012	5,000,000	4,498,160
General Electric Capital Corp., 5.875%, 1/14/2038	2,000,000	1,918,462
General Electric Capital Corp., Note, 5.171%, 3/4/2008 (4)	4,000,000	4,000,000
General Electric Capital Corp., (Series MTNA), 6.000%, 6/15/2012 (1)	5,000,000	5,367,840
International Lease Finance Corp., Note, 4.500%, 5/1/2008	2,000,000	2,000,146
John Deere Capital Corp., Note, (Series MTND), 4.400%, 7/15/2009	6,000,000	6,113,352
Progressive Corp., 6.700%, 6/15/2037 (4)	7,000,000	6,199,151
Residential Capital Corp., 6.500%, 4/17/2013	4,000,000	2,180,000
Santander Perpetual SA, (Series 144A), 6.671%, 10/24/2017 (4)(6)	5,000,000	5,040,665

Description	Principal Amount	Value
Corporate Bonds & Notes (continued)
Financial Services (continued)
SLM Corp., (Series MTNA), 3.471%, 7/27/2009 (4)	$2,500,000	$    2,245,660
		42,073,554
Food Retail — 0.6%
Safeway, Inc., 5.208%, 3/27/2009 (4)	3,000,000	2,972,679
Insurance — 3.3%
AIG SunAmerica Global Financial, Bond, (Series 144A), 5.850%, 8/1/2008 (6)	7,000,000	7,043,904
GE Global Insurance Holding, Note, 7.500%, 6/15/2010	4,825,000	5,208,428
HSB Capital I, Company Guarantee, (Series B), 5.168%, 7/15/2027 (4)	4,000,000	3,942,996
		16,195,328
Media — 1.1%
Comcast Corp., Company Guarantee, 4.950%, 6/15/2016	6,000,000	5,654,760
Multimedia — 1.0%
Time Warner Cable, Inc., 5.400%, 7/2/2012	5,000,000	5,053,895
Real Estate — 1.0%
iStar Financials, Inc., 5.850%, 3/15/2017	6,000,000	4,675,002
Restaurants — 0.6%
McDonald’s Corp., (Series MTN), 5.350%, 3/1/2018	3,000,000	3,075,798
Telecommunication Services — 0.4%
AT&T, Inc., 5.500%, 2/1/2018 (1)	2,000,000	2,003,670
Total Corporate Bonds & Notes (identified cost $210,121,268)		205,593,463
Mortgage-Backed Securities — 13.9%
Federal Home Loan Mortgage Corporation — 1.9%
5.500%, 10/1/2021 (1)	2,378,735	2,430,611
5.500%, 10/1/2021 (1)	4,017,107	4,106,186
6.000%, 10/1/2021 (1)	2,360,868	2,439,011
7.500%, 2/1/2031	358,951	388,893
7.500%, 6/1/2031	105,886	114,615
		9,479,316
Federal National Mortgage Association — 11.9%
5.000%, 8/1/2020 (1)	18,058,808	18,298,881
5.000%, 7/1/2035 (1)	2,167,074	2,135,632
5.500%, 11/1/2018 (1)	8,068,427	8,289,179
5.500%, 7/1/2020 (1)	3,170,017	3,247,504
5.500%, 8/1/2021 (1)	17,440,521	17,840,327
6.000%, 9/1/2021 (1)	6,962,810	7,197,339
6.500%, 10/1/2031	703,831	735,075
7.000%, 12/1/2015	470,465	494,517
		58,238,454
Government National Mortgage Association — 0.1%
7.000%, 3/15/2032	$     385,278	$       413,392
Total Mortgage-Backed Securities (identified cost $66,882,560)		68,131,162
U.S. Treasury Bonds & Notes — 7.2%
2.875%, 1/31/2013 (1)	20,000,000	20,357,820
3.500%, 2/15/2018 (1)	15,000,000	14,967,195

(See Notes which are an integral part of the Financial Statements)

30

February 29, 2008 (Unaudited)

Schedule of Investments

Short-Intermediate Bond Fund (continued)

Description	Principal Amount	Value
U.S. Treasury Bonds & Notes (continued)
Total U.S. Treasury Bonds & Notes (identified cost $34,489,143)		$35,325,015
Short-Term Investments — 31.5%
Collateral Pool Investment for Securities on Loan — 27.9% (See Note 2 of the Financial Statements)		137,388,161
Repurchase Agreement — 3.6%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $17,603,043 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $17,982,216 (at amortized cost)	$17,598,570	17,598,570
Total Short-Term Investments (identified cost $154,986,731)		154,986,731
Total Investments — 125.9% (identified cost $626,066,222)		618,922,039
Other Assets and Liabilities — (25.9)%		(127,164,619	)
Total Net Assets — 100.0%		$491,757,420

Portfolio Sector Allocations*
Sector	Fund
Asset-Backed Securities	1.1%
Collateralized Mortgage Obligations	30.4
Corporate Bonds & Notes	41.8
Mortgage-Backed Securities	13.9
U.S. Treasury Bonds & Notes	7.2
Other Assets & Liabilities, Net	5.6
Total	100.0%

Short-Term Income Fund

Description	Principal Amount	Value
Asset-Backed Securities — 12.4%
Other Financial — 12.4%
Capital One Auto Finance Trust, Class A3A, (Series 2007-A), 5.250%, 8/15/2011	$  2,000,000	$    1,980,598
Chase Issuance Trust, Class A, (Series 2007-A15), 4.960%, 9/17/2012	1,500,000	1,552,010
Countrywide Asset-Backed Certificates, Class A1, (Series 2007-QH2), 3.375%, 4/25/2037 (4)(6)(7)	1,303,772	1,237,946
DaimlerChrysler Auto Trust, Class A4, (Series 2006-C), 4.980%, 11/8/2011	2,000,000	2,055,682

Description	Principal Amount	Value
Asset-Backed Securities (continued)
Other Financial (continued)
DaimlerChrysler Auto Trust, Class A3A, (Series 2007-A), 5.000%, 2/8/2012	$  1,600,000	$    1,649,187
GE Capital Credit Card Master Note Trust, Class A, (Series 2006-1), 5.080%, 9/15/2012	1,850,000	1,897,939
Green Tree Home Improvement Loan Trust, Class HEB1, (Series 1998-B), 7.810%, 11/15/2029	504,117	504,991
Pegasus Aviation Lease Securitization, Class A1, (Series 1999-1A), 6.300%, 3/25/2029 (6)	750,654	285,248
Residential Asset Mortgage Products, Inc., Class A1, (Series 2006-NC3), 3.205%, 3/25/2036 (4)	68,032	67,869
USAA Auto Owner Trust, Class A4, (Series 2006-4), 4.980%, 10/15/2012	1,650,000	1,701,444
World Omni Auto Receivables Trust, Class A3, (Series 2007-A), 5.230%, 2/15/2011	1,750,000	1,781,320
Total Asset-Backed Securities (identified cost $14,968,556)		14,714,234
Collateralized Mortgage Obligations — 39.5%
Federal Home Loan Mortgage Corporation — 4.6%
5.250%, 1/15/2034, (Series 3014)	545,594	563,616
5.500%, 7/15/2027, (Series 2572)	1,100,000	1,117,661
5.900%, 11/15/2035, (Series 3061)	1,577,000	1,615,804
6.000%, 3/15/2027, (Series 3207) (1)	2,118,849	2,182,740
		5,479,821
Federal National Mortgage Association — 0.4%
5.000%, 7/25/2033, (Series 2003-63)	484,333	489,549
Government National Mortgage Association — 3.5%
2.866%, 2/16/2020, (Series 2003-48)	497,302	497,970
3.206%, 4/16/2018, (Series 2003-72)	732,900	735,137
3.313%, 4/16/2017, (Series 2002-83)	375,690	377,789
3.590%, 11/16/2017, (Series 2004-78)	485,397	485,030
4.408%, 1/16/2025, (Series 2004-103)	1,000,000	1,016,018
4.419%, 5/16/2034, (Series 2007-46)	1,000,000	1,015,840
		4,127,784
Other Financial — 31.0%
Banc of America Commercial Mortgage, Inc., Class A1, (Series 2007-5), 5.175%, 2/10/2051	1,477,338	1,451,118
Banc of America Funding Corp., Class 1A12, (Series 2006-6), 5.750%, 8/25/2036	1,876,643	1,919,866

(See Notes which are an integral part of the Financial Statements)

31

Marshall Funds

Short-Term Income Fund (continued)

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Other Financial (continued)
Banc of America Funding Corp., Class 1A3, (Series 2007-C), 5.760%, 5/20/2036 (4)	$  1,676,842	$    1,679,689
Commercial Mortgage Pass-Through Certificate, Class A2A, (Series 2006-C8), 5.219%, 12/10/2046	900,000	880,310
Commercial Mortgage Pass-Through Certificate, Class A3, (Series 2004-LB3A), 5.090%, 7/10/2037	1,250,000	1,234,100
Countrywide Alternative Loan Trust, Class 1A2, (Series 2004-J9), 4.586%, 10/25/2034	1,013,425	1,013,208
Countrywide Home Loans, Class 2A2A, (Series 2006-HYB1), 5.536%, 3/20/2036 (4)	1,102,612	1,076,946
CS First Boston Mortgage Securities Corp., Class 1A3, (Series 2003-11), 4.500%, 6/25/2033	289,924	289,515
GMAC Mortgage Corporation Loan Trust, Class 2A2, (Series 2006-AR2), 5.727%, 5/19/2036 (4)	1,144,739	1,118,559
GSR Mortgage Loan Trust, Class 3A3, (Series 2004-12), 4.389%, 12/25/2034 (4)	194,129	193,564
GSR Mortgage Loan Trust, Class 2A2, (Series 2005-AR5), 5.164%, 10/25/2035 (4)	1,185,889	1,191,453
JP Morgan Alternative Loan Trust, Class 2A4, (Series 2006-A5), 5.850%, 10/25/2036 (4)	2,000,000	2,009,160
JP Morgan Chase Commercial Mortgage Securities, Class A1, (Series 2004-C1), 3.053%, 1/15/2038	729,763	714,011
JP Morgan Chase Commercial Mortgage Securities, Class A1, (Series 2006-CB16), 5.338%, 5/12/2045	1,150,143	1,144,681
JP Morgan Chase Commercial Mortgage Securities, Class A1, (Series 2007-LD12), 5.738%, 2/15/2051	1,601,977	1,601,810
JP Morgan Mortgage Trust, Class 2A2, (Series 2005-S3), 5.500%, 1/25/2021	1,024,764	1,042,057
JP Morgan Mortgage Trust, Class 3A1, (Series 2007-A2), 5.859%, 4/25/2037 (4)	1,352,514	1,358,277
LB-UBS Commercial Mortgage Trust, Class A1, (Series 2004-C1), 2.964%, 1/15/2029	823,163	812,884

Description	Principal Amount	Value
Collateralized Mortgage Obligations (continued)
Other Financial (continued)
LB-UBS Commercial Mortgage Trust, Class A1, (Series 2007-C6), 5.569%, 7/15/2040	$  1,217,487	$    1,205,771
Lehman Brothers Commercial Mortgage Trust, Class A1, (Series 2007-LLFA), 3.421%, 6/15/2022 (4)(6)(7)	1,814,560	1,745,953
Master Adjustable Rate Mortgages Trust, Class 3A4, (Series 2004-13), 3.787%, 11/21/2034 (4)	1,781,056	1,782,880
Morgan Stanley Capital, Inc., Class A1, (Series 2003-IQ6), 2.800%, 12/15/2041	7,188	7,171
Morgan Stanley Capital, Inc., Class A1, (Series 2007-IQ16), 5.320%, 12/12/2049	1,226,070	1,203,115
PHH Alternative Mortgage Trust, Class 1A1, (Series 2007-2), 3.245%, 5/25/2037 (4)	1,109,587	1,035,617
Residential Funding Mortgage Securities, Class 2A2, (Series 2006-SA3), 6.003%, 9/25/2036 (4)	1,414,270	1,419,486
Wachovia Bank Commercial Mortgage Trust, Class A1, 3.065%, 2/15/2041	462,476	456,630
Wachovia Bank Commercial Mortgage Trust, Class A1, 3.291%, 12/15/2035	631,025	624,216
Washington Mutual, Class A4, (Series 2004-AR7), 3.940%, 7/25/2034 (4)	3,000,000	2,987,838
Washington Mutual, Class A2, (Series 2005-AR5), 4.677%, 5/25/2035 (4)	1,470,688	1,468,932
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR7), 5.605%, 5/25/2036 (4)	1,374,275	1,379,651
Wells Fargo Mortgage Backed Securities Trust, Class 2A4, (Series 2006-AR8), 5.240%, 4/25/2036 (4)	1,018,243	1,022,065
		37,070,533
Total Collateralized Mortgage Obligations (identified cost $46,915,004)		47,167,687
Corporate Bonds & Notes — 8.3%
Banks — 1.3%
Bank of America Corp., 4.500%, 8/1/2010	1,500,000	1,545,923
Financials — 5.0%
JP Morgan Chase & Co., 4.600%, 1/17/2011	1,500,000	1,528,854
Merrill Lynch & Co., 6.050%, 8/15/2012	1,350,000	1,407,502
Morgan Stanley, 5.050%, 1/21/2011	1,500,000	1,536,362
Residential Capital LLC, Note, 5.678%, 5/22/2009 (4)	1,500,000	1,027,500

(See Notes which are an integral part of the Financial Statements)

32

February 29, 2008 (Unaudited)

Schedule of Investments

Short-Term Income Fund (continued)

Description	Shares or Principal Amount	Value
Corporate Bonds & Notes (continued)
Financials (continued)
SLM Corp., Note, 4.000%, 1/15/2009 (1)	$     450,000	$    433,925
		5,934,143
Insurance — 2.0%
HSB Capital I, Company Guarantee, (Series B), 5.168%, 7/15/2027 (4)	2,430,000	2,395,370
Total Corporate Bonds & Notes (identified cost $10,112,898)		9,875,436
Government Agencies — 19.1%
Federal Home Loan Mortgage Corporation — 11.4%
4.300%, 5/5/2008	3,000,000	3,007,797
5.250%, 2/24/2011 (1)	4,500,000	4,596,890
5.250%, 10/6/2011 (1)	3,750,000	3,798,315
5.500%, 8/20/2012 (1)	2,000,000	2,189,656
		13,592,658
Federal National Mortgage Association — 7.7%
3.625%, 2/12/2013 (1)	2,000,000	2,026,376
4.125%, 6/16/2008	4,000,000	4,015,396
4.200%, 6/8/2009 (1)	3,000,000	3,072,735
		9,114,507
Total Government Agencies (identified cost $22,283,743)		22,707,165
Mortgage-Backed Securities — 2.1%
Federal Home Loan Mortgage Corporation — 0.0%
9.000%, 7/1/2014	12,285	12,632
11.000%, 8/1/2019	22,092	23,571
		36,203
Federal National Mortgage Association — 0.5%
7.000%, 12/1/2015	127,059	133,554
7.500%, 9/1/2015	160,036	167,517
8.000%, 5/1/2008	6	6
9.000%, 7/1/2009	3,213	3,277
9.500%, 12/1/2024	57,563	64,280
9.500%, 1/1/2025	30,958	34,628
9.500%, 1/1/2025	39,226	43,803
10.000%, 7/1/2020	38,504	45,591
11.000%, 12/1/2015	72,020	77,628
		570,284
Government National Mortgage Association — 1.6%
7.500%, 8/15/2037	1,728,596	1,838,572
9.000%, 12/15/2019	55,845	61,316
		1,899,888
Total Mortgage-Backed Securities (identified cost $2,437,676)		2,506,375
Mutual Funds — 5.8%
Eaton Vance Institutional Senior Loan Fund	591,340	4,920,900
Fidelity Advisor Floating Rate High Income Fund	105,994	968,782
Fidelity Floating Rate High Income Fund	109,290	1,000,000
Total Mutual Funds (identified cost $7,553,039)		6,889,682

Description	Principal Amount	Value
Short-Term Investments — 27.2%
Collateral Pool Investment for Securities on Loan — 14.9% (See Note 2 of the Financial Statements)		$17,797,780
Federal Home Loan Mortgage Corporation — 0.2%
4.260%, 5/2/2008 (3)(11)	$     200,000	198,533
Repurchase Agreement — 12.1%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008, to be repurchased at $14,371,999 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity of 8/18/2016, with a market value of $14,684,782 (at amortized cost)	14,368,347	14,368,347
Total Short-Term Investments (identified cost $32,364,660)		32,364,660
Total Investments — 114.4% (identified cost $136,635,576)		136,225,239
Other Assets and Liabilities — (14.4)%		(17,198,131	)
Total Net Assets — 100.0%		$119,027,108

Portfolio Sector Allocations*
Sector	Fund
Asset-Backed Securities	12.4%
Collateralized Mortgage Obligations	39.5
Corporate Bonds & Notes	8.3
Government Agencies	19.1
Mortgage-Backed Securities	2.1
Mutual Funds	5.8
Other Assets & Liabilities, Net	12.8
Total	100.0%

Prime Money Market Fund

Description	Principal Amount	Value
Collateralized Loan Agreements — 7.3%
Brokerage — 7.3%
Deutsche Bank Alex Brown, Inc., 3.195%, 3/3/2008	$150,000,000	$   150,000,000
Morgan Stanley & Co., Inc., 3.185%, 3/3/2008	150,000,000	150,000,000
Wachovia Securities, Inc., 3.200%, 3/3/2008	150,000,000	150,000,000
Total Collateralized Loan Agreements		450,000,000
Commercial Paper — 34.5%
Asset-Backed Securities — 25.2%
Atlantis One Funding, 3.090%, 5/19/2008 (6)(7)(11)	50,000,000	49,660,958

(See Notes which are an integral part of the Financial Statements)

33

Marshall Funds

Prime Money Market Fund (continued)

Description	Principal Amount	Value
Commercial Paper (continued)
Asset-Backed Securities (continued)
Atlantis One Funding, 3.190%, 4/7/2008 (6)(7)(11)	$  100,000,000	$     99,672,139
Cafco LLC, 3.100%, 5/20/2008 (6)(7)(11)	150,000,000	148,966,668
Ciesco LLC, 3.080%, 5/20/2008 (11)	15,000,000	14,897,333
Ciesco LLC, 3.100%, 5/14/2008 (11)	135,000,000	134,139,750
Citibank Omni Master Trust, 5.400%, 3/3/2008 (6)(7)(11)	150,000,000	149,954,831
Concord Minutemen Capital Co., 3.400%, 5/2/2008 (6)(7)(11)	85,000,000	84,502,278
Concord Minutemen Capital Co., 3.400%, 5/9/2008 (6)(7)(11)	62,111,000	61,706,243
CRC Funding LLC, 3.120%, 5/8/2008 (6)(7)(11)	150,000,000	149,116,001
Crown Point Capital Co., 3.450%, 4/10/2008 (6)(7)(11)	50,000,000	49,808,333
Crown Point Capital Co., 3.450%, 4/24/2008 (6)(7)(11)	100,000,000	99,482,500
DaimlerChrysler Revolving Auto Conduit LLC, 3.200%, 4/4/2008 (11)	116,000,000	115,649,422
DaimlerChrysler Revolving Auto Conduit LLC, 3.350%, 4/9/2008 (11)	34,000,000	33,876,608
Jupiter Securitization Co., 3.050%, 5/20/2008 (6)(7)(11)	50,000,000	49,661,111
Lexington Parker Cap. Co. LLC, 3.450%, 4/23/2008 (6)(7)(11)	100,000,000	99,492,083
Lexington Parker Cap. Co. LLC, 3.500%, 4/11/2008 (6)(7)(11)	50,000,000	49,800,694
New Center Asset Trust, Inc., 3.200%, 4/10/2008 (11)	50,000,000	49,822,222
New Center Asset Trust, Inc., 3.250%, 5/21/2008 (11)	100,000,000	99,268,750
		1,539,477,924
Broker/Dealers — 1.6%
JP Morgan Chase & Co., 2.890%, 3/3/2008 (11)	50,000,000	49,991,972
Merrill Lynch & Co., Inc., 3.190%, 3/14/2008 (11)	50,000,000	49,942,403
		99,934,375
Foreign Banks — 3.4%
Rabobank U.S. Financial Corp., 3.000%, 3/3/2008 (11)	150,000,000	149,975,000

Description	Principal Amount	Value
Commercial Paper (continued)
Foreign Banks (continued)
UBS Finance (Delaware) LLC, 2.880%, 3/3/2008 (11)	$  60,000,000	$     59,990,400
		209,965,400
Insurance — 2.1%
Prudential Financial, Inc., 3.100%, 4/3/2008 (6)(7)(11)	25,000,000	24,928,958
Prudential Financial, Inc., 3.150%, 4/8/2008 (6)(7)(11)	25,000,000	24,916,875
Torchmark Corp., 3.240%, 3/18/2008 (6)(7)(11)	21,000,000	20,967,870
Torchmark Corp., 3.240%, 3/20/2008 (6)(7)(11)	13,000,000	12,977,770
Torchmark Corp., 3.250%, 3/25/2008 (6)(7)(11)	10,000,000	9,978,333
Torchmark Corp., 3.300%, 3/10/2008 (6)(7)(11)	17,500,000	17,485,563
Torchmark Corp., 3.320%, 3/7/2008 (6)(7)(11)	16,000,000	15,991,147
		127,246,516
Leasing — 0.8%
International Lease Finance Corp., 3.180%, 3/28/2008 (11)	50,000,000	49,880,750
Telecommunication Services — 1.4%
Verizon Communications, Inc., 3.070%, 4/4/2008 (6)(7)(11)	34,000,000	33,901,419
Verizon Communications, Inc., 3.110%, 3/3/2008 (6)(7)(11)	50,000,000	49,991,361
		83,892,780
Total Commercial Paper		2,110,397,745
Corporate Bonds & Notes — 8.6%
Banks — 3.5%
Bank One Corp., 2.625%, 6/30/2008	36,667,000	36,356,954
Bank One Corp., 6.000%, 8/1/2008	46,298,000	46,424,784
Royal Bank of Canada NY, 5.290%, 2/2/2009	11,920,000	12,059,216
Suntrust Bank, 4.000%, 10/15/2008	7,350,000	7,310,793
U.S. Bank National Association, Sr. Note, (Series BKNT), 4.400%, 8/15/2008	29,000,000	28,887,522
UBS AG Stamford, 4.535%, 12/10/2010	50,000,000	50,003,770
UBS AG Stamford, 5.210%, 9/10/2008	40,000,000	40,000,000
		221,043,039
Broker/Dealers — 0.8%
Merrill Lynch & Co., Inc., (Series MTN), 4.831%, 10/27/2008	3,190,000	3,179,337
Morgan Stanley & Co., Inc., 3.875%, 1/15/2009	48,942,000	48,820,200
		51,999,537

(See Notes which are an integral part of the Financial Statements)

34

February 29, 2008 (Unaudited)

Schedule of Investments

Prime Money Market Fund (continued)

Description	Principal Amount	Value
Corporate Bonds & Notes (continued)
Construction Equipment — 0.2%
Caterpillar Financial Services Corp., 2.700%, 7/15/2008	$  10,000,000	$     9,910,955
Foreign Banks — 0.8%
HBOS Treasury Services, PLC, (Series YCD), 5.450%, 6/19/2008	25,000,000	25,005,941
Household Finance Corp., 6.400%, 6/17/2008	22,245,000	22,305,513
		47,311,454
Insurance — 0.5%
John Hancock Global Funding II, 3.500%, 1/30/2009 (6)(7)	6,000,000	5,973,846
Monumental Global Funding II, 2.800%, 7/15/2008 (6)(7)	19,160,000	18,989,206
Pacific Life Global Funding, 3.750%, 1/15/2009 (6)(7)	5,520,000	5,485,986
		30,449,038
Leasing — 0.5%
International Lease Finance Corp., (Series MTNO), 4.810%, 8/15/2008	11,940,000	11,921,009
International Lease Finance Corp., (Series MTNQ), 4.625%, 6/2/2008	16,120,000	16,096,586
		28,017,595
Telecommunications — 2.3%
Bellsouth Corp., 4.240%, 4/26/2008 (6)(7)	125,700,000	125,484,791
Bellsouth Telecommunications Corp., 6.125%, 9/23/2008	16,000,000	16,107,869
		141,592,660
Total Corporate Bonds & Notes		530,324,278
Notes-Variable — 40.2%
Banks — 3.5%
First Tennessee Bank, 3.139%, 9/16/2008 (4)(6)(7)	45,000,000	45,000,000
Suntrust Bank, (Series BKNT), 4.809%, 4/2/2008 (4)	50,000,000	50,005,106
Washington Mutual, Inc., (Series CD), 3.981%, 4/18/2008 (4)	95,000,000	95,002,591
Westpac Bank NY, (Series MTN), 5.201%, 3/11/2009 (4)	25,000,000	25,000,000
		215,007,697
Broker/Dealers — 9.5%
Bank of America Securities, LLC, 3.225%, 8/29/2008 (4)(6)(7)	100,000,000	100,000,000

Description	Principal Amount	Value
Notes-Variable (continued)
Broker/Dealers (continued)
Bear Stearns Master Note, 3.439%, 5/27/2008 (4)(6)(7)	$  100,000,000	$     100,000,000
Deutsche Bank NY, 4.753%, 1/21/2009 (4)	50,000,000	50,000,000
Goldman Sachs Group, Inc., 3.331%, 8/22/2008 (4)(6)(7)	100,000,000	100,000,000
Lehman Brothers, Inc., 4.848%, 8/27/2008 (4)	100,000,000	100,000,000
Merrill Lynch & Co., Inc., (Series MTN), 3.058%, 8/22/2008 (4)	60,000,000	60,000,000
Merrill Lynch & Co., Inc., (Series MTN), 3.224%, 10/3/2008 (4)	7,000,000	7,000,000
Wachovia Securities Financial Holdings LLC, 3.080%, 3/3/2008 (4)(6)(7)	65,000,000	65,000,000
		582,000,000
Construction Equipment — 2.3%
Caterpillar Financial Services Corp., (Series MTN), 3.200%, 11/26/2008 (4)	70,000,000	70,000,000
Caterpillar Financial Services Corp., (Series MTN), 3.998%, 4/17/2008 (4)	20,000,000	20,000,731
Caterpillar Financial Services Corp., (Series MTN), 4.991%, 6/16/2008 (4)	50,000,000	50,004,155
		140,004,886
Financial Services — 0.9%
GE Capital Corp., (Series MTNA), 3.344%, 7/28/2008 (4)	55,000,000	55,030,550
Foreign Banks — 13.4%
Australia & New Zealand Banking Group, 5.111%, 7/3/2008 (4)(6)(7)	100,000,000	100,000,000
BNP Paribas, 3.060%, 8/19/2008 (4)(6)(7)	100,000,000	100,000,000
Credit Agricole, 3.838%, 8/26/2008 (4)(6)(7)	75,000,000	75,000,000
Credit Agricole, 4.813%, 7/22/2008 (4)(6)(7)	25,000,000	25,000,000
Dekabank, 3.934%, 11/19/2008 (4)	100,000,000	100,000,000
Depfa-Bank PLC, (Series EXL), 5.051%, 7/15/2008 (4)(6)(7)	50,000,000	50,000,000
Natexis Banques Populaires U.S. Finance Co., 3.096%, 9/8/2008 (4)(6)(7)	100,000,000	100,000,000
National Australia Bank, 4.454%, 2/6/2009 (4)(6)(7)	100,000,000	100,000,000

(See Notes which are an integral part of the Financial Statements)

35

Marshall Funds

Prime Money Market Fund (continued)

Description	Principal Amount	Value
Notes-Variable (continued)
Foreign Banks (continued)
Northern Rock PLC, (Series MTN), 5.236%, 7/8/2008 (4)(6)(7)	$  68,000,000	$   68,002,009
Westlb AG NY, 3.225%, 10/9/2008 (4)(6)(7)	100,000,000	100,000,000
		818,002,009
Insurance — 9.3%
Allstate Life Global Fund, (Series EXL), 3.219%, 9/15/2008 (4)(6)(7)	50,000,000	50,008,829
Genworth Life Insurance Co., 3.976%, 4/21/2008 (4)(6)(10)	75,000,000	75,000,000
Hartford Life Global Funding, 4.325%, 1/15/2009 (4)	40,000,000	40,000,000
Jackson National Life Insurance Co., 4.864%, 6/24/2008 (4)(6)(7)	100,000,000	99,968,235
Metropolitan Life Global Funding I, 4.248%, 2/9/2009 (4)(6)(7)	35,000,000	35,000,000
Metropolitan Life Insurance Co., 3.439%, 2/2/2009 (4)(6)(10)	50,000,000	50,000,000
Metropolitan Life Insurance Co., 5.164%, 6/2/2008 (4)(6)(10)	65,000,000	65,000,000
Monumental Global Funding III, 4.906%, 3/20/2008 (4)(6)(7)	83,000,000	83,000,000
Pacific Life Global Funding, 4.523%, 8/8/2008 (4)(6)(7)	75,000,000	75,000,000
		572,977,064
Personal Credit — 1.3%
American Express Credit, (Series MTNB), 3.241%, 3/5/2008 (4)	30,000,000	30,000,000
American Honda Finance Corp., (Series MTN), 4.616%, 7/7/2008 (4)(6)(7)	50,000,000	50,000,000
		80,000,000
Total Notes-Variable		2,463,022,206
Repurchase Agreements — 4.2%
Agreement with Morgan Stanley & Co., Inc., 3.050%, dated 2/29/2008 to be repurchased at $180,045,750 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity date of 8/18/2016, with a market value of $183,927,022	180,000,000	180,000,000

Description	Principal Amount	Value
Repurchase Agreements (continued)
Agreement with State Street Bank & Trust Co., Inc., 2.850%, dated 2/29/2008 to be repurchased at $80,741,068 on 3/3/2008, collateralized by a U.S. Government Agency Obligation with a maturity date of 10/31/2008, with a market value of $82,337,081	$  80,721,896	$   80,721,896
Total Repurchase Agreements		260,721,896
Trust Demand Notes — 5.1%
Broker/Dealers — 2.7%
Greenwich Capital Holdings, 3.325%, 3/3/2008 (4)(6)(7)	100,000,000	100,000,000
JP Morgan Securities, Inc., 3.274%, 3/3/2008 (4)(6)(7)	63,000,000	63,000,000
		163,000,000
Insurance — 2.4%
ING USA Annuity & Life Insurance Co., 3.868%, 4/24/2008 (4)(6)(10)	150,000,000	150,000,000
Total Trust Demand Notes		313,000,000
Total Investments — 99.9% (at amortized cost)		6,127,466,125
Other Assets and Liabilities — 0.1%		9,115,978
Total Net Assets — 100.0%		$6,136,582,103

Portfolio Sector Allocations*
Sector	Fund
Collateralized Loan Agreements	7.3%
Commercial Paper	34.5
Corporate Bonds & Notes	8.6
Notes-Variable	40.2
Repurchase Agreements	4.2
Trust Demand Notes	5.1
Other Assets & Liabilities, Net	0.1
Total	100.0%

(See Notes which are an integral part of the Financial Statements)

36

February 29, 2008 (Unaudited)

Schedule of Investments

Government Money Market Fund

Description	Principal Amount	Value
Government Agencies — 38.1%
Federal Home Loan Bank — 36.9%
2.625%, 7/15/2008	$  2,555,000	$    2,530,074
2.850%, 6/26/2008	250,000	248,208
2.925%, 5/5/2009 (4)	25,000,000	25,000,000
2.976%, 2/11/2009 (4)	50,000,000	50,000,000
3.000%, 7/23/2008	250,000	247,942
3.000%, 3/4/2009	10,000,000	10,000,000
3.225%, 1/16/2009	500,000	497,871
4.100%, 6/13/2008	3,870,000	3,857,079
4.466%, 4/7/2009 (4)	50,000,000	50,000,000
4.625%, 12/4/2008	5,000,000	5,000,000
4.688%, 3/26/2009 (4)	25,000,000	24,998,658
4.806%, 3/18/2008 (4)	25,000,000	24,999,665
4.875%, 6/4/2008	500,000	499,683
		197,879,180
Federal Home Loan Mortgage Corporation — 1.1%
3.000%, 7/9/2008	1,455,000	1,443,085
3.875%, 6/15/2008	4,700,000	4,680,721
		6,123,806
Federal National Mortgage Association — 0.1%
4.700%, 9/2/2008	280,000	280,000
Total Government Agencies		204,282,986
Repurchase Agreements — 63.7%
Agreement with Barclay’s Capital, Inc., Tri-Party Agency, 3.150%, dated 2/29/2008 to be repurchased at $100,026,250 on 3/3/2008, collateralized by a Federal Home Loan Bank Bond with a maturity of 9/11/2009, with a market value of $102,002,174	100,000,000	100,000,000
Agreement with Cantor Fitzgerald, Inc., 3.225%, dated 2/29/2008 to be repurchased at $40,010,750 on 3/3/2008, collateralized by a U.S. Government Agency SBA Pool with various maturities to 2/1/2049, with a market value of $40,800,001	40,000,000	40,000,000
Agreement with Deutsche Bank Alex Brown, Inc., 3.180%, dated 2/29/2008, to be repurchased at $100,026,500 on 3/3/2008, collateralized by a U.S. Government Agency Mortgage Pool with various maturities to 1/1/2038, with a market value of $102,000,000	100,000,000	100,000,000

Description	Principal Amount	Value
Repurchase Agreements (continued)
Agreement with Morgan Stanley & Co., Inc., 3.150%, dated 2/29/2008, to be repurchased at $90,023,625 on 3/3/2008, collateralized by a U.S. Government Agency Mortgage Pool with various maturities to 10/1/2037, with a market value of $92,182,750	$90,000,000	$  90,000,000
Agreement with State Street Bank & Trust Co., Inc., 2.850%, dated 2/29/2008, to be repurchased at $12,148,635 on 3/3/2008, collateralized by U.S. Government Agency Obligations with various maturities to 2/12/2013, with a market value of $12,390,713	12,145,751	12,145,751
Total Repurchase Agreements		342,145,751
Total Investments — 101.8% (at amortized cost)		546,428,737
Other Assets and Liabilities — (1.8)%		(9,584,078	)
Total Net Assets — 100.0%		$536,844,659

Portfolio Sector Allocations*
Sector	Fund
Government Agencies	38.1%
Repurchase Agreements	63.7
Other Assets & Liabilities, Net	(1.8)
Total	100.0%

Tax-Free Money Market Fund

Description	Principal Amount	Value
Municipals — 97.6%
Alabama — 0.6%
Columbia, Alabama Industrial Development Board Pollution Control, Revenue Bonds (Series C), 4.000%, 10/1/2022, Call Date 3/3/2008 (4)	$  1,000,000	$    1,000,000
Decatur, Alabama Educational Building Authority, Revenue Bonds, 3.450%, 12/1/2027, Call Date 3/3/2008 (4)	1,555,000	1,555,000
Florence-Scs, Alabama Educational Building Authority, Revenue Bonds, 3.450%, 4/1/2017, Call Date 3/3/2008 (4)	1,310,000	1,310,000
		3,865,000

(See Notes which are an integral part of the Financial Statements)

37

Marshall Funds

Tax-Free Money Market Fund (continued)

Description	Principal Amount	Value
Municipals (continued)
Alaska — 1.4%
Valdez, Alaska Marine Terminal Revenue, Revenue Bonds, 3.500%, 6/1/2037, Call Date 3/3/2008 (4)	$  6,700,000	$    6,700,000
Valdez, Alaska Marine Terminal Revenue, Revenue Bonds (Series B), 3.500%, 7/1/2037, Call Date 3/3/2008 (4)	2,600,000	2,600,000
		9,300,000
Arizona — 1.2%
Arizona Health Facilities Authority, Hospital System Revenue Bonds, 3.260%, 2/1/2042, Call Date 2/1/2013 (4)	8,000,000	8,000,000
California — 2.9%
California State Floater Certificates, GO UT (Series 5G), 3.190%, 11/1/2037, Call Date 11/17/2017 (4)	3,000,000	3,000,000
Golden State Tobacco Securitization Corp. Floaters, Revenue Bonds (Series 2448), 3.310%, 6/1/2045, Call Date 6/1/2015 (4)	10,000,000	10,000,000
Lehman Municipal Trust Receipts, Revenue Bonds (Series P41W), 4.270%, 8/15/2033, Call Date 8/15/2013 (4)	6,210,000	6,210,000
		19,210,000
Colorado — 2.8%
Colorado Educational & Cultural Facilities Authority, Revenue Bonds, 3.500%, 9/1/2033, Call Date 3/3/2008 (4)	4,100,000	4,100,000
Colorado Educational & Cultural Facilities Authority, Revenue Bonds, 3.500%, 9/1/2035, Call Date 3/3/2008 (4)	2,700,000	2,700,000
Colorado Educational & Cultural Facilities Authority, Revenue Bonds, 3.500%, 9/1/2036, Call Date 3/3/2008 (4)	1,900,000	1,900,000
Denver, Colorado City & County Economic Development, Revenue Bonds, 2.570%, 7/1/2029, Call Date 3/5/2008 (4)	1,930,000	1,930,000
Park Creek Metropolitan District, Revenue Bonds, 2.250%, 12/1/2037, Call Date 6/1/2008 (4)	8,000,000	8,000,000
		18,630,000

Description	Principal Amount	Value
Municipals (continued)
District of Columbia — 2.7%
District of Columbia Floaters, GO UT (Series 1920), 3.310%, 6/1/2030, Call Date 6/1/2017 (4)	$10,665,000	$10,665,000
District of Columbia, Revenue Bonds, 3.450%, 10/1/2023, Call Date 3/3/2008 (4)	4,015,000	4,015,000
District of Columbia, Revenue Bonds, 3.450%, 3/1/2026, Call Date 3/3/2008 (4)	3,375,000	3,375,000
		18,055,000
Florida — 7.3%
Eclipse Funding Trust, Revenue Bonds, 3.250%, 4/1/2037, Call Date 4/1/2017 (4)	9,990,000	9,990,000
Florida Development Finance Corp., Revenue Bonds, 3.450%, 7/1/2026, Call Date 3/3/2008 (4)	1,700,000	1,700,000
Gulfstream Park Community Development District Floaters, Revenue Bonds (Series 2G), 3.220%, 5/1/2039, Call Date 5/1/2015 (4)	12,055,000	12,055,000
Jackson County, Florida Pollution Control, Revenue Bonds, 3.750%, 7/1/2022, Call Date 3/3/2008 (4)	3,930,000	3,930,000
Jacksonville, Florida Health Facilities Authority, Revenue Bonds, 3.500%, 8/15/2019, Call Date 3/3/2008 (4)	10,795,000	10,795,000
Miami-Dade County, Florida Aviation, Revenue Bonds (Series D), 4.000%, 10/1/2008	3,845,000	3,860,478
Miami-Dade County, Florida School Board, Certificates of Participation (Series A), 5.000%, 8/1/2027 (4)	6,000,000	6,033,474
		48,363,952
Georgia — 3.4%
Clayton County, Georgia Housing Authority, Multifamily Housing, Revenue Bonds, 3.040%, 1/1/2021, Call Date 3/5/2008 (4)	100,000	100,000
Clayton County, Georgia Housing Authority, Multifamily Housing, Revenue Bonds, 3.040%, 1/1/2021, Call Date 3/5/2008 (4)	875,000	875,000
Puttable Floating Option Tax-Exempt Receipts, Revenue Bonds, 4.020%, 11/15/2028, Call Date 11/15/2017 (4)	15,135,000	15,135,000

(See Notes which are an integral part of the Financial Statements)

38

February 29, 2008 (Unaudited)

Schedule of Investments

Tax-Free Money Market Fund (continued)

Description	Principal Amount	Value
Municipals (continued)
Georgia (continued)
Rome-Floyd County, Georgia Development Authority, Revenue Bonds, 3.260%, 11/1/2011 (4)	$  3,500,000	$    3,500,000
Savannah, Georgia Economic Development Authority, Revenue Bonds, 3.750%, 1/1/2016, Call Date 3/3/2008 (4)	2,785,000	2,785,000
		22,395,000
Idaho — 1.9%
Eclipse Funding Trust, Revenue Bonds, 3.780%, 4/1/2036, Call Date 4/1/2017 (4)	7,810,000	7,810,000
Idaho Health Facilities Authority, Revenue Bonds, 3.950%, 7/1/2035, Call Date 3/3/2008 (4)	4,580,000	4,580,000
		12,390,000
Illinois — 11.8%
Chicago, Illinois Board of Education, GO UT (Series 2314), 3.310%, 12/1/2018 (4)	5,120,000	5,120,000
Chicago, Illinois Refunding Project, GO UT (Series D), 3.160%, 1/1/2040, Call Date 3/3/2008 (4)	17,800,000	17,800,000
Deutsche Bank Spears/Lifers Trust, GO UT (Series DB-475), 3.240%, 1/1/2026 (4)	5,035,000	5,035,000
Du Page County, Illinois High School District No. 88 Putters, GO UT (Series 2577), 3.410%, 1/1/2015 (4)	9,385,000	9,385,000
Illinois Finance Authority, Revenue Bonds, 3.875%, 10/1/2037 (4)	5,800,000	5,829,129
Joliet, Illinois Regional Port District, Revenue Bonds, 3.650%, 10/1/2024, Call Date 3/3/2008 (4)	2,840,000	2,840,000
Lakemoor, Illinois Multifamily, Revenue Bonds (Series B), 3.380%, 12/1/2020 (4)	5,510,000	5,510,000
Lehman Municipal Trust Receipts, GO UT (Series P34W), 4.360%, 12/1/2024 (4)	3,705,000	3,705,000
Lehman Municipal Trust Receipts, Revenue Bonds (Series FC54), 3.550%, 8/1/2037, Call Date 8/1/2017 (4)	8,585,000	8,585,000
Lehman Municipal Trust Receipts, Revenue Bonds (Series 6), 4.210%, 4/1/2028 (4)	4,730,000	4,730,000

Description	Principal Amount	Value
Municipals (continued)
Illinois (continued)
Municipal Securities Trust Certificates, Revenue Bonds (Series 7006), 5.000%, 1/1/2031, Call Date 1/1/2011 (4)(6)	$  6,245,000	$    6,245,000
Phoenix Realty SPL Account-U LP Illinois, Multifamily, Refunding Revenue Bonds, 3.360%, 4/1/2020, Call Date 3/3/2008 (4)	4,075,000	4,075,000
		78,859,129
Indiana — 0.9%
Dekko Foundation Educational Facilities Tax Exempt Income Trust, Certificates of Ownership (Series 1), 3.900%, 4/1/2021, Call Date 3/3/2008 (4)	2,200,000	2,200,000
Indiana Health Facility Financing Authority, Revenue Bonds, 3.450%, 12/1/2021, Call Date 3/3/2008 (4)	3,840,000	3,840,000
		6,040,000
Kentucky — 0.4%
Hancock County, Kentucky Industrial Building Revenue Bonds, 3.260%, 7/1/2012 (4)	1,685,000	1,685,000
Hancock County, Kentucky Pollution Control Revenue Bonds, 3.260%, 7/1/2012 (4)	1,000,000	1,000,000
		2,685,000
Louisiana — 1.6%
BB&T Municipal Trust, Revenue Bonds (Series 4000), 3.290%, 7/1/2018 (4)	2,020,000	2,020,000
Lafayette Parish, Louisiana Industrial Development Board, Inc., Revenue Bonds, 3.900%, 12/15/2014, Call Date 3/3/2008 (4)	1,035,000	1,035,000
Louisiana Housing Finance Agency, Revenue Bonds, 3.050%, 12/1/2025 (4)	55,000	55,000
St. John Baptist Parish, Louisiana Revenue Bonds (Series 2116), 3.310%, 6/1/2037, Call Date 6/1/2017 (4)	7,490,000	7,490,000
		10,600,000
Maryland — 1.5%
Maryland Health & Higher Educational Facilities Authority, Revenue Bonds (Series 2402), 3.310%, 7/1/2019 (4)	9,795,000	9,795,000
Massachusetts — 2.0%
Massachusetts Health & Educational Facilities Authority, Revenue Bonds (Series 2405), 3.310%, 7/1/2020 (4)	12,200,000	12,200,000

(See Notes which are an integral part of the Financial Statements)

39

Marshall Funds

Tax-Free Money Market Fund (continued)

Description	Principal Amount	Value
Municipals (continued)
Massachusetts (continued)
Massachusetts State Industrial Financial Agency, Revenue Bonds, 4.150%, 12/1/2019, Call Date 3/5/2008 (4)	$  1,000,000	$    1,000,000
		13,200,000
Michigan — 0.5%
Michigan State Hospital Finance Authority, Revenue Bonds (Series A), 3.900%, 3/1/2030, Call Date 3/3/2008 (4)	3,475,000	3,475,000
Mississippi — 0.3%
Newton, Mississippi Industrial Development, Revenue Bonds, 3.450%, 6/1/2009, Call Date 3/3/2008 (4)	2,300,000	2,300,000
Missouri — 4.3%
Missouri State Environmental Improvement & Energy Resources Authority, Water Pollution, Revenue Bonds (Series 1813), 3.510%, 1/1/2015 (4)	1,940,000	1,940,000
Puttable Floating Option Tax-Exempt Receipts, Revenue Bonds, 5.310%, 12/1/2028 (4)	15,995,000	15,995,000
St. Louis, Missouri Airport Revenue, GO UT (Series 2615), 3.560%, 7/1/2015 (4)	10,350,000	10,350,000
		28,285,000
Montana — 0.6%
Montana State Board of Investment Economic Development, Revenue Bonds, 3.210%, 9/1/2010 (4)	3,925,000	3,925,000
Nebraska — 0.1%
Nebraska, Investment Finance Authority, Multifamily Mortgage, Revenue Bonds, 3.050%, 9/1/2031, Call Date 3/3/2008 (4)	600,000	600,000
New York — 0.9%
Erie County, New York Industrial Development Agency, Revenue Bonds (Series D21), 3.500%, 5/1/2025, Call Date 5/1/2017 (4)	2,000,000	2,000,000
Suffolk County, New York Industrial Development Agency, Revenue Bonds, 4.150%, 4/1/2018, Call Date 3/5/2008 (4)	3,785,000	3,785,000
		5,785,000

Description	Principal Amount	Value
Municipals (continued)
North Carolina — 0.2%
Alamance County, North Carolina Industrial Facilities & Pollution Control Financing Authority, Revenue Bonds, 3.500%, 12/1/2014 (4)	$     520,000	$       520,000
North Carolina Medical Care Community Health Care Facilities, Revenue Bonds, 3.450%, 7/1/2017, Call Date 3/3/2008 (4)	935,000	935,000
Rutherford County, North Carolina Industrial Facilities & Pollution Control Authority, Revenue Bonds, 3.500%, 12/1/2008 (4)	100,000	100,000
		1,555,000
Ohio — 4.7%
Hamilton County, Ohio Hospital Facilities, Revenue Bonds, 5.260%, 7/15/2029, Call Date 4/1/2008 (4)	9,900,000	9,900,000
Lawrence County, Ohio Industrial Development, Revenue Bonds, 3.260%, 11/1/2011 (4)	3,250,000	3,250,000
Montgomery County, Ohio Industrial Development, Refunding Revenue Bonds, 3.260%, 10/1/2009 (4)	4,700,000	4,700,000
North Canton, Ohio Health Care Facilities, Revenue Bonds, 3.330%, 4/1/2017, Call Date 3/3/2008 (4)	3,330,000	3,330,000
North Canton, Ohio Health Care Facilities, Revenue Bonds, 3.330%, 4/1/2032, Call Date 3/3/2008 (4)	10,165,000	10,165,000
		31,345,000
Oklahoma — 3.8%
Oklahoma State Industrial Authority, Revenue Bonds, 3.900%, 8/1/2018, Call Date 3/3/2008 (4)	1,495,000	1,495,000
Tulsa, Oklahoma Industrial Authority, Revenue Bonds, 3.360%, 11/1/2026, Call Date 3/3/2008 (4)	3,100,000	3,100,000
Tulsa, Oklahoma Industrial Authority, Revenue Bonds, 3.550%, 11/1/2030 (4)	18,000,000	18,000,000
Tulsa, Oklahoma Industrial Authority, Revenue Bonds, 3.900%, 10/1/2032, Call Date 3/3/2008 (4)	2,535,000	2,535,000
		25,130,000

(See Notes which are an integral part of the Financial Statements)

40

February 29, 2008 (Unaudited)

Schedule of Investments

Tax-Free Money Market Fund (continued)

Description	Principal Amount	Value
Municipals (continued)
Pennsylvania — 3.5%
Allegheny County, Pennsylvania Industrial Development Authority Health & Housing Facilities, Revenue Bonds, 3.260%, 7/1/2010 (4)	$  3,100,000	$    3,100,000
Bucks County, Pennsylvania Industrial Development Authority, Revenue Bonds, 3.450%, 9/1/2019, Call Date 3/3/2008 (4)	1,915,000	1,915,000
Chester County, Pennsylvania Industrial Development Authority, Revenue Bonds, 3.400%, 4/1/2017, Call Date 3/3/2008 (4)	1,120,000	1,120,000
Pennsylvania State Higher Educational Facilities Authority, Revenue Bonds, 4.500%, 5/1/2037, Call Date 5/1/2008 (4)	4,900,000	4,905,508
Philadelphia, Pennsylvania Authority for Industrial Development, Revenue Bonds, 3.450%, 11/1/2021 (4)	3,275,000	3,275,000
Washington County, Pennsylvania Hospital Authority, Revenue Bonds, 3.800%, 7/1/2023 (4)	9,080,000	9,080,000
		23,395,508
Puerto Rico — 0.7%
Puerto Rico Industrial Medical & Environmental Pollution Control Facilities, Financing Authority, Revenue Bonds, 3.950%, 3/1/2023, Call Date 3/1/2009 (4)	4,500,000	4,500,000
South Carolina — 3.8%
Puttable Floating Option Tax-Exempt Receipts, Revenue Bonds, 4.060%, 8/1/2039, Call Date 4/1/2011 (4)	14,995,000	14,995,000
Scago, South Carolina Educational Facilities Corp. for Union School District Installment, Revenue Bonds (Series 1783), 3.410%, 12/1/2031, Call Date 12/1/2016 (4)	10,200,000	10,200,000
		25,195,000
Tennessee — 2.3%
Metropolitan Government, Nashville & Davidson County, Tennessee Industrial Development Board, Revenue Bonds, 3.100%, 12/1/2014 (4)	4,350,000	4,350,000

Description	Principal Amount	Value
Municipals (continued)
Tennessee (continued)
Morgan Keegan Municipal Products, Inc., Revenue Bonds (Series B-1), 3.260%, 6/1/2037 (4)	$10,000,000	$10,000,000
Rutherford County, Tennessee Industrial Development Board, Revenue Bonds, 3.260%, 7/1/2010 (4)	1,000,000	1,000,000
		15,350,000
Texas — 14.1%
Comal, Texas Independent School District, GO UT, 3.310%, 8/1/2016 (4)	2,260,000	2,260,000
Deutsche Bank Spears/Lifers Trust, GO UT (Series DB-512), 3.220%, 2/15/2038, Call Date 2/15/2017 (4)	3,250,000	3,250,000
Deutsche Bank Spears/Lifers Trust, GO UT (Series DB-513), 3.220%, 8/15/2033, Call Date 8/15/2017 (4)	10,570,000	10,570,000
Deutsche Bank Spears/Lifers Trust, GO UT (Series DB-514), 3.220%, 2/15/2038, Call Date 3/3/2008 (4)	3,275,000	3,275,000
Deutsche Bank Spears/Lifers Trust, GO UT (Series DB-597), 3.220%, 2/15/2028, Call Date 2/15/2017 (4)	3,830,000	3,830,000
JP Morgan Chase & Co., Putters, Revenue Bonds (Series 1684P), 3.910%, 8/15/2014 (4)	2,240,000	2,240,000
McAllen, Texas International Toll Bridge Floaters, Revenue Bonds (Series 2326), 4.660%, 3/1/2032, Call Date 3/1/2017 (4)	8,665,000	8,665,000
North Texas Tollway Authority, Dallas North Tollway System, Revenue Bonds (Series B), 5.000%, 1/1/2038 (4)	11,280,000	11,341,394
North Texas Tollway Authority, Revenue Bonds (Series C), 5.000%, 1/1/2018 (4)	4,585,000	4,632,316
North Texas Tollway Authority, Revenue Notes, 4.125%, 11/19/2008, Call Date 3/3/2008	20,000,000	20,000,000
Nueces River Authority, Revenue Bonds, 3.310%, 7/15/2022, Call Date 7/15/2015 (4)	6,155,000	6,155,000
Nueces River Authority, Revenue Bonds, 3.310%, 7/15/2024, Call Date 7/15/2015 (4)	7,240,000	7,240,000
Texas State Putters, GO UT (Series 2615), 3.410%, 10/1/2015 (4)	11,200,000	11,200,000
		94,658,710

(See Notes which are an integral part of the Financial Statements)

41

Marshall Funds

Tax-Free Money Market Fund (continued)

Description	Principal Amount	Value
Municipals (continued)
Vermont — 4.6%
Vermont Educational & Health Buildings Financing Agency, Revenue Bonds (Series A), 3.500%, 10/1/2036, Call Date 3/3/2008 (4)	$  8,810,000	$    8,810,000
Vermont Educational & Health Buildings Financing Agency, Revenue Bonds, 3.500%, 4/1/2015, Call Date 3/3/2008 (4)	1,570,000	1,570,000
Vermont Educational & Health Buildings Financing Agency, Revenue Bonds, 3.500%, 4/1/2032, Call Date 3/3/2008 (4)	14,600,000	14,600,000
Vermont Educational & Health Buildings Financing Agency, Revenue Bonds, 3.500%, 10/1/2034, Call Date 3/3/2008 (4)	5,300,000	5,300,000
		30,280,000
Virginia — 0.8%
Lewistown Commerce Center Community Development Authority, Virginia Special Tax Revenue Bonds (Series 2115), 3.240%, 3/1/2027, Call Date 3/1/2018 (4)	4,000,000	4,000,000
Suffolk, Virginia Redevelopment & Housing Authority Multi-Family Housing, Revenue Bonds, 3.350%, 9/1/2019, Call Date 3/3/2008 (4)	1,405,000	1,405,000
		5,405,000
Washington — 3.8%
King County, Washington Putters, GO UT (Series 1184), 4.000%, 1/1/2013 (4)	12,000,000	12,000,000
Washington State Health Care Facilities Authority, Revenue Bonds, 3.080%, 11/15/2026, Call Date 3/3/2008 (4)	12,000,000	12,000,000
Washington State Housing Finance Commission, Revenue Bonds, 3.150%, 7/1/2033, Call Date 3/3/2008 (4)	935,000	935,000
		24,935,000
Wisconsin — 6.2%
Arrowhead, Wisconsin Union High School District, Tax & Revenue Promissory Notes, 3.600%, 9/29/2008	3,400,000	3,400,645
Middleton, Wisconsin Revenue Notes, 4.000%, 7/1/2008, Call Date 3/3/2008	4,610,000	4,610,000
Rhinelander School District, GO UT, Tax & Revenue Promissory Notes, 3.460%, 9/10/2008	4,500,000	4,500,461

Description	Shares or Principal Amount	Value
Municipals (continued)
Wisconsin (continued)
Sheboygan, Wisconsin Area School District, Tax & Revenue Notes, 3.650%, 6/27/2008	$  3,000,000	$    3,000,371
Sparta, Wisconsin Area School District, Tax & Revenue Promissory Notes, 3.620%, 10/7/2008	4,300,000	4,300,496
St. Francis, Wisconsin School District, GO UT, Tax & Revenue Promissory Notes, 3.540%, 10/29/2008	3,100,000	3,100,574
Sun Prairie, Wisconsin Area School District, Tax & Revenue Promissory Notes, 3.650%, 10/20/2008	10,300,000	10,304,398
Waunakee, Wisconsin Community School District, Tax & Revenue Promissory Notes, 3.520%, 10/20/2008	5,000,000	5,000,615
West Salem, Wisconsin School District, Tax & Revenue Promissory Notes, 3.570%, 10/30/2008	3,050,000	3,050,387
Wisconsin State Health & Educational Facilities Authority, Revenue Bonds, 3.900%, 5/1/2026, Call Date 4/1/2008 (4)	200,000	200,000
		41,467,947
Total Municipals		648,975,246
Mutual Funds — 0.0%
Federated Tax-Free Obligations Fund	158,483	158,483
Total Mutual Funds (identified cost $158,483)		158,483
Total Investments — 97.6% (at amortized cost)		649,133,729
Other Assets and Liabilities — 2.4%		15,642,434
Total Net Assets — 100.0%		$664,776,163

Portfolio Sector Allocations*
Sector	Fund
Municipals	97.6%
Mutual Funds	0.0
Other Assets & Liabilities, Net	2.4
Total	100.0%

(See Notes which are an integral part of the Financial Statements)

42

Notes to Schedule of Investments (Unaudited)

Note:    The categories of investments are shown as a percentage of total net assets for each Fund as of February 29, 2008.

* Portfolio composition will change due to ongoing management of the Fund. The percentages are based on net assets at the close of business on February 29, 2008.

(1) Certain shares or principal amounts are temporarily on loan to unaffiliated brokers-dealers.

(2) Non-income producing.

(3) Represents the initial deposit within a margin account used to ensure the Fund is able to satisfy the obligations of its outstanding long futures contracts.

(4) Floating rate securities are securities whose yields vary with a designated market index or market rate. These securities are shown at their current rates as of February 29, 2008.

(5) Purchased on a when-issued or delayed delivery basis.

(6) Denotes a restricted security which is subject to restrictions on resale under federal securities law. At February 29, 2008, these securities amounted to:

Fund	Amount		% of Total Net Assets
Aggregate Bond Fund	$	8,925,545	3.49	%
Government Income Fund		17,215,325	2.41
Short-Intermediate Bond Fund		40,486,845	8.23
Short-Term Income Fund		3,269,147	2.75
Prime Money Market Fund		3,482,876,037	56.76
Tax-Free Money Market Fund		6,245,000	0.94

(7) Denotes a restricted security which has been deemed liquid by criteria approved by the Fund’s Board of Directors.

(8) Please refer to the Statement of Additional Information for an explanation of the credit ratings.

(9) Securities that are subject to alternative minimum tax represent 10.62% of Intermediate Tax-Free Fund’s portfolio as calculated based upon total portfolio market value.

(10) Securities have redemption features that may delay redemption beyond seven days.

(11) Each issue shows the rate of the discount at the time of purchase.

The following acronyms are used throughout this report:

ADR —American Depository Receipt

AMBAC—American Municipal Bond Assurance Corporation

CFC —Cooperative Finance Corporation

CIFG —CDC IXIS Financial Guaranty

COL —Collateralized

FGIC —Financial Guaranty Insurance Corporation

FRN —Floating Rate Note

GDR —Global Depository Receipt

GO —Government Obligation

HFDC —Health Facility Development Corporation

IDC —Industrial Development Corporation

INS —Insured

LIQ —Liquidity Agreement

LP —Limited Partnership

LOC —Letter of Credit

MTN —Medium Term Note

PCA —Pollution Control Authority

PLC —Public Limited Company

REITs —Real Estate Investment Trusts

REMIC —Real Estate Mortgage Investment Conduit

TCRs —Transferable Custody Receipts

TRANs  —Tax and Revenue Anticipation Notes

UT —Unlimited Tax

VRNs —Variable Rate Notes

43

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44

February 29, 2008 (Unaudited)

Statements of Assets and Liabilities

	Large-Cap Value Fund			Large-Cap Growth Fund			Mid-Cap Value Fund			Mid-Cap Growth Fund			Small-Cap Growth Fund			International Stock Fund
Assets:
Investments in securities, at value	$	320,260,922		$	273,210,701		$	439,958,814		$	300,636,496		$	391,209,147		$	535,112,215
Investments in repurchase agreements		5,826,307			8,527,526			4,523,649			3,827,849			6,080,336			—
Cash		—			—			—			—			—			—
Cash denominated in foreign currencies (identified cost, $764,857)		—			—			—			—			—			723,616
Dividends receivable		690,458			292,340			461,668			110,158			19,570			1,430,478
Interest receivable		494			723			383			324			515			—
Receivable for investments sold		—			3,869,448			6,434,566			6,351,991			1,644,345			12,009,338
Receivable for capital stock sold		2,171,184			4,243,760			3,147,519			4,287,360			220,389			5,122,307
Receivable for daily variation margin		—			—			—			—			—			—
Prepaid expenses		31,010			27,009			32,830			28,963			28,599			22,774
Total assets		328,980,375			290,171,507			454,559,429			315,243,141			399,202,901			554,420,728
Liabilities:
Payable for capital stock redeemed		75,381			58,325			283,484			219,609			229,942			414,680
Payable to custodian		—			—			—			—			—			2,730,844
Payable for investment purchased		—			4,773,832			740,912			6,694,667			3,080,746			2,004,505
Payable on collateral due to broker		29,413,277			41,334,610			54,445,999			60,142,774			128,926,480			99,667,797
Payable for foreign tax expense		—			—			—			—			—			90,296
Call options written, at value (premium received $390,280)		168,075			—			—			—			—			—
Put options written, at value (proceeds received $427,297)		72,220			—			—			—			—			—
Payable for income distribution		—			—			—			—			—			—
Payable to affiliates (Note 5)		252,894			206,507			351,100			210,979			285,679			464,770
Other liabilities		46,371			45,666			78,489			40,434			46,236			59,276
Total liabilities		30,028,218			46,418,940			55,899,984			67,308,463			132,569,083			105,432,168
Total Net Assets	$	298,952,157		$	243,752,567		$	398,659,445		$	247,934,678		$	266,633,818		$	448,988,560
Net Assets Consist of:
Paid-in-capital	$	263,151,609		$	232,049,573		$	367,779,068		$	225,397,050		$	267,271,721		$	428,447,262
Net unrealized appreciation (depreciation) on investments, options, futures contracts and foreign currency translation		38,146,750			8,674,448			27,875,742			24,650,658			10,811,965			22,257,660
Accumulated net realized gain (loss) on investments, options, futures contracts and foreign currency transactions		(3,010,210	)		3,195,237			2,782,593			(1,047,103	)		(8,741,327	)		(980,540	)
Undistributed net investment income (distributions in excess of net investment income)		664,008			(166,691	)		222,042			(1,065,927	)		(2,708,541	)		(735,822	)
Total Net Assets	$	298,952,157		$	243,752,567		$	398,659,445		$	247,934,678		$	266,633,818		$	448,988,560
Net Asset Value, Offering Price and Redemption Proceeds Per Share
Investor Class of Shares:
Net Asset Value, Offering Price and Redemption Proceeds Per Share	$	12.61		$	11.80		$	12.20		$	17.27		$	14.49		$	13.80
Advisor Class of Shares:
Net Asset Value and Price and Redemption Proceeds Per Share	$	12.61		$	11.80		$	12.20		$	17.27		$	14.49		$	13.80
Offering Price Per Share	$	13.38	(1)	$	12.52	(1)	$	12.94	(1)	$	18.32	(1)	$	15.37	(1)	$	14.64	(1)
Institutional Class of Shares:
Net Asset Value, Offering Price and Redemption Proceeds Per Share	$	12.61		$	11.80		$	12.20		$	17.28		$	14.49		$	14.04
Net Assets:
Investor Class of Shares	$	185,301,315		$	178,695,170		$	316,413,111		$	202,969,654		$	186,776,045		$	124,696,750
Advisor Class of Shares		10,349,960			8,193,157			9,853,181			4,896,212			15,674,567			6,753,446
Institutional Class of Shares		103,300,882			56,864,240			72,393,153			40,068,812			64,183,206			317,538,364
Total Net Assets	$	298,952,157		$	243,752,567		$	398,659,445		$	247,934,678		$	266,633,818		$	448,988,560
Shares Outstanding:
Investor Class of Shares		14,692,321			15,149,204			25,936,222			11,749,908			12,892,928			9,034,538
Advisor Class of Shares		820,671			694,565			807,681			283,435			1,081,967			489,353
Institutional Class of Shares		8,190,661			4,820,951			5,933,717			2,318,737			4,428,833			22,619,626
Total Shares Outstanding		23,703,653			20,664,720			32,677,620			14,352,080			18,403,728			32,143,517
Investments, at identified cost	$	288,517,761		$	273,063,779		$	416,606,721		$	279,813,687		$	386,477,518		$	512,909,164

(1) Computation of offering price per share 100/94.25 of net asset value.

(2) Computation of offering price per share 100/96.25 of net asset value.

(3) Computation of offering price per share 100/98.00 of net asset value.

(See Notes which are an integral part of the Financial Statements)

45

Marshall Funds

Aggregate Bond Fund			Government Income Fund			Intermediate Tax-Free Fund			Short- Intermediate Bond Fund			Short-Term Income Fund			Prime Money Market Fund			Government Money Market Fund		Tax-Free Money Market Fund
$	346,245,618		$	1,116,564,623		$	81,187,648		$	601,323,469		$	121,856,892		$	5,866,744,229		$	204,282,986	$	649,133,729
	14,868,700			44,106,441			—			17,598,570			14,368,347			260,721,896			342,145,751		—
	—			—			57,642			—			—			—			—		1,000
	—			—			—			—			—			—			—		—
	—			—			7,146			—			38,743			—			—		—
	1,781,072			3,215,492			964,562			3,670,487			470,009			23,034,398			1,117,577		2,865,701
	—			—			3,564,792			5,014,858			—			—			—		15,336,163
	890,213			1,014,135			70,051			3,515,545			171,598			709,382			382		165,000
	—			—			—			—			185,935			—			—		—
	22,848			32,666			12,350			26,064			24,150			56,605			21,797		15,645
	363,808,451			1,164,933,357			85,864,191			631,148,993			137,115,674			6,151,266,510			547,568,493		667,517,238
	103,086			1,117,477			209			945,383			54,363			—			—		—
	—			—			—			—			—			—			—		—
	17,440,542			104,374,873			1,673,020			—			—			—			10,000,000		1,500,329
	89,983,266			344,530,509			—			137,388,161			17,797,780			—			—		—
	—			—			—			—			—			—			—		—
	—			—			—			—			—			—			—		—
	—			—			—			—			—			—			—		—
	117,953			687,071			230,615			791,365			189,995			13,045,095			592,459		1,081,452
	119,870			353,534			25,456			213,341			20,071			1,505,225			103,686		127,359
	14,748			94,735			13,671			53,323			26,357			134,087			27,689		31,935
	107,779,465			451,158,199			1,942,971			139,391,573			18,088,566			14,684,407			10,723,834		2,741,075
$	256,028,986		$	713,775,158		$	83,921,220		$	491,757,420		$	119,027,108		$	6,136,582,103		$	536,844,659	$	664,776,163
$	251,774,192		$	707,415,779		$	84,304,407		$	517,136,163		$	126,324,743		$	6,136,915,972		$	536,843,458	$	664,775,725
	1,692,909			2,178,986			(703,697	)		(7,144,183	)		(140,264	)		—			—		—
	2,494,537			3,549,710			320,567			(18,529,371	)		(7,179,443	)		(343,045	)		1,201		385
	67,348			630,683			(57	)		294,811			22,072			9,176			—		53
$	256,028,986		$	713,775,158		$	83,921,220		$	491,757,420		$	119,027,108		$	6,136,582,103		$	536,844,659	$	664,776,163
$	10.21		$	9.58		$	9.88		$	9.22		$	9.17		$	1.00		$	1.00	$	1.00
$	10.21		$	9.57		$	—		$	9.21		$	9.18		$	1.00		$	—	$	—
$	10.61	(2)	$	9.94	(2)	$	—		$	9.57	(2)	$	9.37	(3)	$	—		$	—	$	—
$	10.21		$	9.57		$	—		$	9.21		$	9.18		$	1.00		$	1.00	$	1.00
$	67,861,772		$	391,902,458		$	83,921,220		$	116,420,146		$	31,016,879		$	3,037,216,895		$	229,746,778	$	269,350,270
	171,192			5,251,038			—			5,406,861			2,133,808			157,196,206			—		—
	187,996,022			316,621,662			—			369,930,413			85,876,421			2,942,169,002			307,097,881		395,425,893
$	256,028,986		$	713,775,158		$	83,921,220		$	491,757,420		$	119,027,108		$	6,136,582,103		$	536,844,659	$	664,776,163
	6,645,933			40,924,429			8,493,134			12,631,206			3,382,250			3,037,422,853			229,746,210		269,348,056
	16,766			548,461			—			586,926			232,520			157,226,970			—		—
	18,411,744			33,073,696			—			40,164,000			9,354,698			2,942,266,152			307,097,248		395,427,669
	25,074,443			74,546,586			8,493,134			53,382,132			12,969,468			6,136,915,975			536,843,458		664,775,725
$	359,421,409		$	1,158,492,078		$	81,891,345		$	626,066,222		$	136,635,576		$	6,127,466,125		$	546,428,737	$	649,133,729

46

Six Months Ended February 29, 2008 (Unaudited)

Statements of Operations

	Large-Cap Value Fund			Large-Cap Growth Fund			Mid-Cap Value Fund			Mid-Cap Growth Fund			Small-Cap Growth Fund			International Stock Fund
Investment Income:
Dividend income	$	3,710,655		$	1,283,201		$	3,703,134		$	462,725	(1)	$	173,112		$	3,199,724	(1)
Interest income		86,327			134,784			199,400			109,343			116,995			296,611
Securities lending income		48,262			45,556			114,446			148,921			398,640			97,968
Total income		3,845,244			1,463,541			4,016,980			720,989			688,747			3,594,303
Expenses:
Investment adviser fee (Note 5)		1,229,346			970,829			1,853,216			914,751			1,402,270			2,544,696
Shareholder services fees (Note 5)—
Investor Class of Shares		382,197			304,846			594,747			293,498			328,174			307,224
Advisor Class of Shares		14,641			11,669			14,158			6,431			14,341			9,429
Administrative fees (Note 5)		151,234			121,810			221,432			115,323			131,099			227,787
Portfolio accounting fees		60,046			51,004			79,646			49,169			53,900			55,674
Transfer and dividend disbursing agent fees		77,249			81,187			135,515			66,332			83,139			77,268
Custodian fees (Note 5)		28,823			25,270			37,159			24,286			26,452			126,419
Registration fees		12,763			13,663			15,661			12,362			12,879			19,792
Auditing fees		13,745			13,745			13,745			13,745			13,745			13,745
Legal fees		2,958			2,958			2,958			2,958			2,958			2,958
Printing and postage		21,279			16,405			31,445			18,094			24,503			23,334
Directors’ fees		9,589			9,589			9,589			9,589			9,589			9,589
Insurance premiums		1,652			1,196			3,071			1,044			1,263			2,415
Distribution services fees (Note 5)—
Advisor Class of Shares		—			—			—			—			—			—
Miscellaneous		5,243			4,693			7,909			4,673			4,808			—
Total expenses		2,010,765			1,628,864			3,020,251			1,532,255			2,109,120			3,420,330
Deduct (Note 5)—
Expense waivers		—			—			—			—			—			—
Net expenses		2,010,765			1,628,864			3,020,251			1,532,255			2,109,120			3,420,330
Net investment income (loss)		1,834,479			(165,323	)		996,729			(811,266	)		(1,420,373	)		173,973
Net Realized and Unrealized Gain (Loss) on Investments, Options, Futures Contracts and Foreign Currency:
Net realized gain (loss) on investment transactions		2,074,372			9,359,170			4,528,612			7,752,300			3,450,437			725,265	(2)
Net realized loss on options		(410,712	)		—			—			—			—			—
Net realized gain on futures contracts		—			—			—			—			—			—
Net realized loss on foreign currency contracts		—			—			—			—			—			(860,264	)
Net change in unrealized appreciation (depreciation) on investments, options, futures contracts and foreign currency translation		(25,263,958	)		(26,382,675	)		(52,430,307	)		(10,374,577	)		(27,474,872	)		(44,179,893	)
Net realized and unrealized gain (loss) on investments, options, futures contracts and foreign currency		(23,600,298	)		(17,023,505	)		(47,901,695	)		(2,622,277	)		(24,024,435	)		(44,314,892	)
Change in net assets resulting from operations	$	(21,765,819	)	$	(17,188,828	)	$	(46,904,966	)	$	(3,433,543	)	$	(25,444,808	)	$	(44,140,919	)

(1) Net of foreign taxes withheld of $12,568 and $249,149, respectively.

(2) Net of foreign taxes withheld of $69,296.

(See Notes which are an integral part of the Financial Statements)

47

Marshall Funds

Aggregate Bond Fund			Government Income Fund			Intermediate Tax-Free Fund			Short- Intermediate Bond Fund			Short-Term Income Fund			Prime Money Market Fund			Government Money Market Fund			Tax-Free Money Market Fund
$	—		$	—		$	63,178		$	—		$	338,442		$	—		$	—		$	—
	6,298,803			19,442,380			1,798,364			14,020,043			2,631,428			133,593,335			9,927,647			10,811,017
	140,848			394,385			—			171,754			35,728			—			—			—
	6,439,651			19,836,765			1,861,542			14,191,797			3,005,598			133,593,335			9,927,647			10,811,017
	462,084			1,411,226			255,395			1,033,166			117,877			4,018,224			429,488			613,058
	93,225			683,904			106,320			387,764			87,470			3,659,497			265,717			410,084
	85			6,836			—			6,981			3,009			160,359			—			—
	110,441			308,037			39,339			232,165			58,109			846,361			69,909			98,866
	49,985			112,924			17,312			91,189			41,111			281,651			48,451			64,976
	31,011			168,725			10,318			72,549			34,998			250,406			15,771			30,935
	23,095			48,161			8,506			38,287			11,788			280,313			33,906			43,084
	23,205			30,174			10,819			22,645			20,601			29,941			19,142			11,908
	13,745			13,745			13,745			13,745			13,745			13,745			13,745			13,745
	2,958			2,958			2,958			2,958			2,958			2,958			2,958			2,958
	4,895			33,293			2,375			18,917			4,250			41,681			1,900			10,039
	9,589			9,589			9,589			9,589			9,589			9,589			9,589			9,589
	734			3,644			407			2,996			587			24,600			1,359			2,609
	—			—			—			—			—			192,430			—			—
	5,271			7,654			3,900			7,993			4,418			40,523			11,781			10,252
	830,323			2,840,870			480,983			1,940,944			410,510			9,852,278			923,716			1,322,103
	(101,648	)		(185,033	)		(247,079	)		(124,174	)		(113,746	)		(482,360	)		(228,511	)		(298,961	)
	728,675			2,655,837			233,904			1,816,770			296,764			9,369,918			695,205			1,023,142
	5,710,976			17,180,928			1,627,638			12,375,027			2,708,834			124,223,417			9,232,442			9,787,875
	4,028,885			5,846,798			747,545			5,132,249			(325,012	)		51,483			3,806			6,827
	—			—			—			—			—			—			—			—
	—			—			32,597			—			1,099,644			—			—			—
	—			—			—			—			—			—			—			—
	(389,140	)		4,005,907			(1,206,656	)		(2,103,636	)		1,247,562			—			—			—
	3,639,745			9,852,705			(426,514	)		3,028,613			2,022,194			51,483			3,806			6,827
$	9,350,721		$	27,033,633		$	1,201,124		$	15,403,640		$	4,731,028		$	124,274,900		$	9,236,248		$	9,794,702

48

Statements of Changes in Net Assets

	Large-Cap Value Fund						Large-Cap Growth Fund						Mid-Cap Value Fund
	Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007
Increase (Decrease) in Net Assets
Operations—
Net investment income (loss)	$	1,834,479		$	4,476,911		$	(165,323	)	$	225,558		$	996,729		$	2,370,241
Net realized gain (loss) on investments and options transactions		1,663,660			12,010,597			9,359,170			15,689,841			4,528,612			81,960,521
Net realized gain (loss) on futures contracts		—			—			—			120,338			—			53,972
Net realized gain (loss) on foreign currency contracts		—			—			—			—			—			—
Net change in unrealized appreciation/depreciation on investments, options, futures contracts and foreign currency translation		(25,263,958	)		26,700,784			(26,382,675	)		21,233,535			(52,430,307	)		(2,440,345	)
Change in net assets resulting from operations		(21,765,819	)		43,188,292			(17,188,828	)		37,269,272			(46,904,966	)		81,944,389
Distributions to Shareholders—
Distributions to shareholders from net investment income
Investor Class of Shares		(1,799,200	)		(4,398,291	)		(129,544	)		(71,728	)		(2,041,191	)		(2,760,010	)
Advisor Class of Shares		(67,055	)		(165,345	)		(4,858	)		(3,161	)		(49,371	)		(63,118	)
Institutional Class of Shares		—			—			—			—			—			—
Distributions to shareholders from net realized gain on investments
Investor Class of Shares		(15,406,842	)		(27,773,899	)		(20,373,844	)		(7,489,417	)		(62,614,194	)		(52,414,423	)
Advisor Class of Shares		(572,569	)		(1,033,763	)		(766,482	)		(331,325	)		(1,491,159	)		(1,190,564	)
Institutional Class of Shares		—			—			—			—			—			—
Change in net assets resulting from distributions to shareholders		(17,845,666	)		(33,371,298	)		(21,274,728	)		(7,895,631	)		(66,195,915	)		(56,428,115	)
Capital Stock Transactions—
Proceeds from sale of shares		120,443,330			39,823,816			77,620,443			27,950,167			95,839,837			73,848,332
Net asset value of shares issued to shareholders in payment of distributions declared		16,275,322			29,749,219			20,378,392			7,504,188			63,350,189			53,623,537
Cost of shares redeemed		(139,562,903	)		(69,929,515	)		(72,048,663	)		(35,988,400	)		(232,677,130	)		(176,648,083	)
Redemption fees		2,443			360			915			368			21,144			4,563
Change in net assets resulting from capital stock transactions		(2,841,808	)		(356,120	)		25,951,087			(533,677	)		(73,465,960	)		(49,171,651	)
Change in net assets		(42,453,293	)		9,460,874			(12,512,469	)		28,839,964			(186,566,841	)		(23,655,377	)
Net Assets:
Beginning of period		341,405,450			331,944,576			256,265,036			227,425,072			585,226,286			608,881,663
End of period	$	298,952,157		$	341,405,450		$	243,752,567		$	256,265,036		$	398,659,445		$	585,226,286
Undistributed net investment income (distributions in excess of net investment income) included in net assets at end of period	$	664,008		$	695,784		$	(166,691	)	$	133,034		$	222,042		$	1,315,875

(1) Reflects operations for the period from June 1, 2007 (start of performance) to August 31, 2007.

(See Notes which are an integral part of the Financial Statements)

49

Marshall Funds

Mid-Cap Growth Fund						Small-Cap Growth Fund						International Stock Fund						Aggregate Bond Fund
Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007(1)
$	(811,266	)	$	(1,251,744	)	$	(1,420,373	)	$	(2,156,567	)	$	173,973		$	6,721,060		$	5,710,976		$	2,199,526
	7,752,300			27,760,884			3,450,437			41,322,366			725,265			63,289,997			4,028,885			(165,678	)
	—			536,752			—			809,473			—			—			—			—
	—			—			—			—			(860,264	)		(1,079,625	)		—			—
	(10,374,577	)		11,195,890			(27,474,872	)		10,377,796			(44,179,893	)		13,359,610			(389,140	)		2,082,049
	(3,433,543	)		38,241,782			(25,444,808	)		50,353,068			(44,140,919	)		82,291,042			9,350,721			4,115,897
	—			—			—			—			(2,971,761	)		(551,295	)		(1,761,734	)		(555,777	)
	—			—			—			—			(87,516	)		(25,923	)		(1,632	)		(93	)
	—			—			—			—			(3,505,265	)		(887,517	)		(3,895,021	)		(1,643,049	)
	—			—			(46,730,647	)		(15,633,272	)		(29,578,350	)		(27,023,552	)		(460,991	)		—
	—			—			(1,408,805	)		(558,154	)		(871,061	)		(863,610	)		(409	)		—
	—			—			—			—			(28,472,794	)		(21,952,876	)		(907,877	)		—
	—			—			(48,139,452	)		(16,191,426	)		(65,486,747	)		(51,304,773	)		(7,027,664	)		(2,198,919	)
	81,107,597			41,581,974			117,288,573			53,465,975			121,657,993			97,053,700			78,222,032			205,897,334
	—			—			46,741,612			15,589,777			62,812,652			49,857,212			6,511,650			2,159,497
	(56,762,565	)		(32,737,563	)		(87,705,283	)		(39,481,694	)		(151,329,290	)		(81,992,616	)		(33,717,506	)		(7,284,056	)
	12,026			111			7,165			4,372			17,534			754			—			—
	24,357,058			8,844,522			76,332,067			29,578,430			33,158,889			64,919,050			51,016,176			200,772,775
	20,923,515			47,086,304			2,747,807			63,740,072			(76,468,777	)		95,905,319			53,339,233			202,689,753
	227,011,163			179,924,859			263,886,011			200,145,939			525,457,337			429,552,018			202,689,753			—
$	247,934,678		$	227,011,163		$	266,633,818		$	263,886,011		$	448,988,560		$	525,457,337		$	256,028,986		$	202,689,753
$	(1,065,927	)	$	(254,661	)	$	(2,708,541	)	$	(1,288,168	)	$	(735,822	)	$	5,654,747		$	67,348		$	14,759

50

Statements of Changes in Net Assets

	Government Income Fund						Intermediate Tax-Free Fund						Short-Intermediate Bond Fund
	Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007
Increase (Decrease) in Net Assets
Operations—
Net investment income (loss)	$	17,180,928		$	28,798,882		$	1,627,638		$	2,888,946		$	12,375,027		$	31,261,026
Net realized gain (loss) on investments and options transactions		5,846,798			1,212,650			747,545			(336,577	)		5,132,249			(2,021,303	)
Net realized gain (loss) on futures contracts		—			—			32,597			—			—			—
Net realized gain (loss) on foreign currency contracts		—			—			—			—			—			—
Net change in unrealized appreciation/depreciation on investments, options, futures contracts and foreign currency translation		4,005,907			(281,673	)		(1,206,656	)		(547,311	)		(2,103,636	)		(3,458,155	)
Change in net assets resulting from operations		27,033,633			29,729,859			1,201,124			2,005,058			15,403,640			25,781,568
Distributions to Shareholders—
Distributions to shareholders from net investment income
Investor Class of Shares		(12,823,607	)		(26,838,687	)		(1,627,170	)		(2,888,545	)		(7,230,269	)		(29,371,524	)
Advisor Class of Shares		(128,420	)		(266,134	)		—			—			(130,952	)		(277,028	)
Institutional Class of Shares		(4,037,799	)		(1,417,046	)		—			—			(5,012,144	)		(1,521,546	)
Distributions to shareholders from net realized gain on investments
Investor Class of Shares		—			—			—			—			—			—
Advisor Class of Shares		—			—			—			—			—			—
Institutional Class of Shares		—			—			—			—			—			—
Change in net assets resulting from distributions to shareholders		(16,989,826	)		(28,521,867	)		(1,627,170	)		(2,888,545	)		(12,373,365	)		(31,170,098	)
Capital Stock Transactions—
Proceeds from sale of shares		246,188,599			339,057,814			12,914,579			19,282,931			224,970,120			291,488,968
Net asset value of shares issued to shareholders in payment of distributions declared		12,729,877			21,067,467			351,151			622,650			7,188,259			19,630,375
Cost of shares redeemed		(252,934,215	)		(252,508,462	)		(10,956,346	)		(17,202,260	)		(290,312,178	)		(455,857,890	)
Redemption fees		20,768			10,866			392			228			10,714			925
Change in net assets resulting from capital stock transactions		6,005,029			107,627,685			2,309,776			2,703,549			(58,143,085	)		(144,737,622	)
Change in net assets		16,048,836			108,835,677			1,883,730			1,820,062			(55,112,810	)		(150,126,152	)
Net Assets:
Beginning of period		697,726,322			588,890,645			82,037,490			80,217,428			546,870,230			696,996,382
End of period	$	713,775,158		$	697,726,322		$	83,921,220		$	82,037,490		$	491,757,420		$	546,870,230
Undistributed net investment income (distributions in excess of net investment income) included in net assets at end of period	$	630,683		$	439,581		$	(57	)	$	(525	)	$	294,811		$	293,149

(See Notes which are an integral part of the Financial Statements)

51

Marshall Funds

Short-Term Income Fund						Prime Money Market Fund						Government Money Market Fund						Tax-Free Money Market Fund
Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007			Six Months Ended February 29, 2008 (Unaudited)			Year Ended August 31, 2007
$	2,708,834		$	5,348,831		$	124,223,417		$	240,796,645		$	9,232,442		$	13,620,708		$	9,787,875		$	14,927,950
	(325,012	)		47,748			51,483			7,764			3,806			—			6,827			37,867
	1,099,644			432,345			—			—			—			—			—			—
	—			—			—			—			—			—			—			—
	1,247,562			77,928			—			—			—			—			—			—
	4,731,028			5,906,852			124,274,900			240,804,409			9,236,248			13,620,708			9,794,702			14,965,817
	(1,574,555	)		(4,966,136	)		(66,747,220	)		(127,670,889	)		(4,441,731	)		(8,234,819	)		(5,053,297	)		(8,665,262	)
	(54,282	)		(113,762	)		(2,712,672	)		(4,857,323	)		—			—			—			—
	(1,088,546	)		(479,191	)		(54,763,525	)		(108,268,433	)		(4,790,711	)		(5,385,889	)		(4,734,578	)		(6,262,688	)
	—			—			—			—			(1,218	)		—			(5,136	)		(22,616	)
	—			—			—			—			—			—			—			—
	—			—			—			—			(1,387	)		—			(4,306	)		(14,880	)
	(2,717,383	)		(5,559,089	)		(124,223,417	)		(240,796,645	)		(9,235,047	)		(13,620,708	)		(9,797,317	)		(14,965,446	)
	63,139,160			54,464,216			7,894,896,868			15,538,575,940			1,981,601,955			3,017,381,978			839,905,766			1,199,160,497
	1,536,081			2,858,046			31,288,427			58,130,914			4,807,233			7,845,674			1,415,545			2,754,411
	(67,053,112	)		(67,733,207	)		(6,738,634,361	)		(14,845,340,451	)		(1,786,273,310	)		(2,846,475,694	)		(728,799,132	)		(958,670,741	)
	2,491			198			—			—			—			—			—			—
	(2,375,380	)		(10,410,747	)		1,187,550,934			751,366,403			200,135,878			178,751,958			112,522,179			243,244,167
	(361,735	)		(10,062,984	)		1,187,602,417			751,374,167			200,137,079			178,751,958			112,519,564			243,244,538
	119,388,843			129,451,827			4,948,979,686			4,197,605,519			336,707,580			157,955,622			552,256,599			309,012,061
$	119,027,108		$	119,388,843		$	6,136,582,103		$	4,948,979,686		$	536,844,659		$	336,707,580		$	664,776,163		$	552,256,599
$	22,072		$	30,621		$	9,176		$	9,176		$	—		$	—		$	53		$	53

52

Financial Highlights—Investor Class shares (for a share outstanding throughout each period)

Period Ended August 31,	Net asset value, beginning of period		Net investment income (loss)(4)			Net realized and unrealized gain (loss) on investments, options, futures contracts and foreign currency(4)			Total from investment operations			Distributions to shareholders from net investment income			Distributions to shareholders from net realized gain on investments, options, futures contracts and foreign currency transactions			Total distributions			Net asset value, end of period		Total return(1)(8)	Ratios to Average Net Assets(9)
																								Net Expenses		Expense waiver(2)		Net investment income (loss)(2)	Net assets, end of period (000 omitted)		Portfolio turnover rate(8)
Large-Cap Value Fund
2003(3)	$	12.12	$	0.24		$	0.42		$	0.66		$	(0.20	)	$	—		$	(0.20	)	$	12.58	5.56%	1.23	%	—	%	2.04%	$	343,475	62	%
2004(3)		12.58		0.30			1.62			1.92			(0.30	)		—			(0.30	)		14.20	15.39	1.22		—		2.27		358,354	103
2005(3)		14.20		0.33			1.00			1.33			(0.35	)		(0.72	)		(1.07	)		14.46	9.77	1.22		—		2.30		328,848	103
2006(3)		14.46		0.20			1.36			1.56			(0.20	)		(1.88	)		(2.08	)		13.94	11.99	1.23		0.01		1.47		319,834	121
2007(3)		13.94		0.18			1.55			1.73			(0.18	)		(1.19	)		(1.37	)		14.30	12.89	1.22		0.01		1.26		329,192	43
2008(3)(11)		14.30		0.09			(1.01	)		(0.92	)		(0.08	)		(0.69	)		(0.77	)		12.61	(6.93)	1.24		—		1.09		185,301	23
Large-Cap Growth Fund
2003(3)		10.59		0.04			0.71			0.75			(0.02	)		—			(0.02	)		11.32	7.11	1.28		—		0.38		254,286	73
2004(3)		11.32		0.02			0.78			0.80			(0.02	)		—			(0.02	)		12.10	7.08	1.25		—		0.20		257,684	129
2005(3)		12.10		0.09			1.54			1.63			(0.09	)		—			(0.09	)		13.64	13.51	1.26		—		0.63		237,294	146
2006(3)		13.64		0.00			0.40			0.40			(0.01	)		(1.87	)		(1.88	)		12.16	2.86	1.27		0.01		0.00		218,109	134
2007(3)		12.16		0.01			1.99			2.00			(0.00	)		(0.43	)		(0.43	)		13.73	16.68	1.27		0.01		0.09		246,811	75
2008(3)(11)		13.73		(0.01	)		(0.77	)		(0.78	)		(0.01	)		(1.14	)		(1.15	)		11.80	(6.77)	1.26		—		(0.15)		178,695	72
Mid-Cap Value Fund
2003(3)		10.65		0.01			1.86			1.87			(0.01	)		—			(0.01	)		12.51	17.63	1.27		—		0.13		267,309	39
2004(3)		12.51		0.05			2.14			2.19			(0.01	)		(0.45	)		(0.46	)		14.24	17.76	1.22		—		0.44		463,104	33
2005(3)		14.24		0.03			2.61			2.64			(0.06	)		(0.96	)		(1.02	)		15.86	19.16	1.20		—		0.25		637,293	37
2006(3)		15.86		0.07			0.70			0.77			(0.05	)		(1.50	)		(1.55	)		15.08	5.12	1.19		0.01		0.47		595,968	63
2007(3)		15.08		0.06			1.94			2.00			(0.07	)		(1.38	)		(1.45	)		15.63	13.52	1.21		0.01		0.37		572,444	62
2008(3)(11)		15.63		0.03			(1.41	)		(1.38	)		(0.06	)		(1.99	)		(2.05	)		12.20	(9.91)	1.23		—		0.39		316,413	20
Mid-Cap Growth Fund
2003(3)		9.31		(0.08	)		2.34			2.26			—			—			—			11.57	24.27	1.28		—		(0.78)		236,981	121
2004(3)		11.57		(0.10	)		(0.32	)		(0.42	)		—			—			—			11.15	(3.63)	1.24		—		(0.85)		184,632	240
2005(3)		11.15		(0.10	)		2.60			2.50			—			—			—			13.65	22.42	1.29		0.01		(0.72)		172,137	188
2006(3)		13.65		(0.09	)		0.87			0.78			—			—			—			14.43	5.71	1.30		0.01		(0.64)		175,529	134
2007(3)		14.43		(0.10	)		3.13			3.03			—			—			—			17.46	21.00	1.27		0.01		(0.61)		222,095	169
2008(3)(11)		17.46		(0.07	)		(0.12	)		(0.19	)		—			—			—			17.27	(1.09)	1.26		—		(0.67)		202,970	85
Small-Cap Growth Fund
2003(3)		8.75		(0.07	)		3.15			3.08			—			—			—			11.83	35.20	1.72		—		(0.82)		90,126	248
2004(3)		11.83		(0.17	)		0.94			0.77			—			—			—			12.60	6.51	1.58		—		(1.28)		129,875	267
2005(3)		12.60		(0.18	)		3.60			3.42			—			—			—			16.02	27.14	1.55		0.01		(1.21)		155,327	195
2006(3)		16.02		(0.14	)		1.93			1.79			—			(1.37	)		(1.37	)		16.44	11.37	1.54		—		(0.93)		193,170	148
2007(3)		16.44		(0.15	)		4.05			3.90			—			(1.33	)		(1.33	)		19.01	24.73	1.53		0.01		(0.91)		255,894	176
2008(3)(11)		19.01		(0.11	)		(1.09	)		(1.20	)		—			(3.32	)		(3.32	)		14.49	(8.47)	1.51		—		(1.02)		186,776	90
International Stock Fund
2003(3)		9.31		0.06			0.65			0.71			—			—			—			10.02	7.63	1.54		0.02		0.65		204,477	171
2004(3)		10.02		0.00			1.02			1.02			(0.04	)		—			(0.04	)		11.00	10.20	1.50		0.02		0.00(5)		216,082	137
2005(3)		11.00		0.09			2.33			2.42			(0.07	)		—			(0.07	)		13.35	22.03	1.48		0.02		0.70		191,274	150
2006(3)		13.35		0.12			3.06			3.18			(0.12	)		—			(0.12	)		16.41	23.90	1.49		0.02		0.75		233,098	146
2007(3)		16.41		0.21			2.64			2.85			(0.04	)		(1.88	)		(1.92	)		17.34	18.37	1.45		0.02		1.23		267,675	98
2008(3)(11)		17.34		0.00			(1.34	)		(1.34	)		(0.20	)		(2.00	)		(2.20	)		13.80	(8.94)	1.47		—		(0.06)		124,697	38
Aggregate Bond Fund
2007(6)		10.00		0.11			0.10			0.21			(0.11	)		—			(0.11	)		10.10	2.11	0.80		0.14		4.38		59,013	129
2008(11)		10.10		0.24			0.17			0.41			(0.24	)		(0.06	)		(0.30	)		10.21	4.08	0.80		0.09		4.77		67,862	123
Government Income Fund
2003(3)		9.72		0.32			(0.08	)		0.24			(0.36	)		—			(0.36	)		9.60	2.45	0.87		0.33		3.30		382,287	539
2004(3)		9.60		0.43			0.09			0.52			(0.48	)		—			(0.48	)		9.64	5.50	0.87		0.33		4.49		344,253	113
2005(3)		9.64		0.37			(0.03	)		0.34			(0.38	)		—			(0.38	)		9.60	3.61	0.88		0.33		3.75		475,920	561
2006(3)		9.60		0.42			(0.18	)		0.24			(0.42	)		—			(0.42	)		9.42	2.57	0.86		0.34		4.50		582,466	760
2007(3)		9.42		0.42			0.02			0.44			(0.42	)		—			(0.42	)		9.44	4.71	0.89		0.29		4.44		550,614	686
2008(3)(11)		9.44		0.23			0.13			0.36			(0.22	)		—			(0.22	)		9.58	3.87	0.80		0.05		4.75		391,902	127

(See Notes which are an integral part of the Financial Statements)

53

Financial Highlights—Investor Class shares (for a share outstanding throughout each period)

Period Ended August 31,	Net asset value, beginning of period		Net investment income (loss)(4)		Net realized and unrealized gain (loss) on investments, options, futures contracts and foreign currency(4)			Total from investment operations		Distributions to shareholders from net investment income			Distributions to shareholders from net realized gain on investments, options, futures contracts and foreign currency transactions			Total distributions			Net asset value, end of period		Total return(1)(8)	Ratios to Average Net Assets(9)
																						Net Expenses		Expense waiver(2)		Net investment income (loss)(2)	Net assets, end of period (000 omitted)		Portfolio turnover rate(8)
Intermediate Tax-Free Fund
2003(3)	$	10.57	$	0.38	$	(0.07	)	$	0.31	$	(0.38	)	$	—		$	(0.38	)	$	10.50	2.95%	0.60	%	0.50	%	3.57%	$	102,717	17	%
2004(3)		10.50		0.37		0.13			0.50		(0.37	)		(0.02	)		(0.39	)		10.61	4.88	0.62		0.50		3.51		96,952	8
2005(3)		10.61		0.37		(0.18	)		0.19		(0.36	)		(0.01	)		(0.37	)		10.43	1.83	0.61		0.50		3.48		90,619	57
2006(3)		10.43		0.35		(0.14	)		0.21		(0.35	)		(0.26	)		(0.61	)		10.03	2.12	0.65		0.51		3.48		80,217	31
2007(3)		10.03		0.36		(0.10	)		0.26		(0.36	)		—			(0.36	)		9.93	2.59	0.60		0.53		3.56		82,037	48
2008(3)(11)		9.93		0.19		(0.05	)		0.14		(0.19	)		—			(0.19	)		9.88	1.41	0.55		0.58		3.83		83,921	91
Short-Intermediate Bond Fund
2003(3)		9.44		0.41		0.07			0.48		(0.45	)		—			(0.45	)		9.47	5.10	0.72		0.29		4.30		629,664	317
2004(3)		9.47		0.38		0.06			0.44		(0.41	)		—			(0.41	)		9.50	4.68	0.72		0.29		3.98		625,908	278
2005(3)		9.50		0.35		(0.08	)		0.27		(0.37	)		—			(0.37	)		9.40	2.90	0.73		0.30		3.70		646,961	357
2006(3)		9.40		0.40		(0.17	)		0.23		(0.40	)		—			(0.40	)		9.23	2.56	0.73		0.30		4.39		690,447	430
2007(3)		9.23		0.43		(0.08	)		0.35		(0.42	)		—			(0.42	)		9.16	3.86	0.75		0.26		4.56		359,507	421
2008(3)(11)		9.16		0.22		0.05			0.27		(0.21	)		—			(0.21	)		9.22	3.02	0.80		0.05		4.69		116,420	121
Short-Term Income Fund
2003(3)		9.42		0.33		(0.03	)		0.30		(0.40	)		—			(0.40	)		9.32	3.22	0.58		0.57		3.47		150,302	43
2004(3)		9.32		0.27		(0.02	)		0.25		(0.36	)		—			(0.36	)		9.21	2.75	0.54		0.57		2.94		148,735	40
2005(3)		9.21		0.26		(0.10	)		0.16		(0.34	)		—			(0.34	)		9.03	1.74	0.54		0.57		2.95		135,894	52
2006(3)		9.03		0.31		0.04			0.35		(0.38	)		—			(0.38	)		9.00	3.92	0.58		0.58		3.45		126,788	19
2007(3)		9.00		0.38		0.04			0.42		(0.40	)		—			(0.40	)		9.02	4.78	0.58		0.52		4.28		75,677	52
2008(3)(11)		9.02		0.20		0.15			0.35		(0.20	)		—			(0.20	)		9.17	3.96	0.60		0.19		4.50		31,017	22
Prime Money Market Fund
2003		1.00		0.01		—			0.01		(0.01	)		—			(0.01	)		1.00	1.05	0.45		0.03		1.04		1,889,427	—
2004		1.00		0.01		—			0.01		(0.01	)		—			(0.01	)		1.00	0.76	0.45		0.04		0.76		2,123,605	—
2005		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	2.22	0.45		0.04		2.20		2,078,992	—
2006		1.00		0.04		—			0.04		(0.04	)		—			(0.04	)		1.00	4.25	0.45		0.04		4.19		2,453,274	—
2007		1.00		0.05		—			0.05		(0.05	)		—			(0.05	)		1.00	5.06	0.45		0.02		4.95		2,753,457	—
2008(11)		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	2.29	0.45		0.02		4.53		3,037,217	—
Government Money Market Fund
2004(7)		1.00		0.00		—			0.00		0.00			—			0.00			1.00	0.23	0.45		0.17		0.96		118,401	—
2005		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	2.11	0.45		0.18		2.09		121,712	—
2006		1.00		0.04		—			0.04		(0.04	)		—			(0.04	)		1.00	4.16	0.45		0.17		4.09		92,339	—
2007		1.00		0.05		—			0.05		(0.05	)		—			(0.05	)		1.00	4.99	0.45		0.13		4.88		199,797	—
2008(11)		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	2.11	0.45		0.11		4.17		229,747	—
Tax-Free Money Market Fund
2005(10)		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	1.60	0.45		0.14		1.76		142,826	—
2006		1.00		0.03		—			0.03		(0.03	)		—			(0.03	)		1.00	2.84	0.45		0.13		2.85		192,603	—
2007		1.00		0.03		—			0.03		(0.03	)		—			(0.03	)		1.00	3.33	0.45		0.13		3.28		308,414	—
2008(11)		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	1.54	0.45		0.10		3.07		269,350	—

(1) Based on net asset value.

(2) This voluntary expense decrease is reflected in both the expense and net investment income (loss) ratios shown.

(3) Redemption fees consisted of the following per share amounts:

	Per Share Amount
Fund	2003		2004		2005		2006		2007		2008(11)
International Stock Fund	$	0.01	$	0.00	$	0.00	$	0.00	$	0.00	$	0.00
Intermediate Tax-Free Fund		0.01		0.00		0.00		0.00		0.00		0.00

Funds not shown had redemption fees of less than $0.01.

(See Notes which are an integral part of the Financial Statements)

54

Financial Highlights—Investor Class shares (for a share outstanding throughout each period)

(4) Per share information is based on average shares outstanding.

(5) Represents less than 0.005%.

(6) Reflects operations for the period from June 1, 2007 (start of performance) to August 31, 2007.

(7) Reflects operations for the period from May 17, 2004 (start of performance) to August 31, 2004.

(8) Not annualized for periods less than one year.

(9) Annualized for periods less than one year.

(10) Reflects operations for the period from September 22, 2004 (start of performance) to August 31, 2005.

(11) For the six months ended February 29, 2008 (unaudited).

(See Notes which are an integral part of the Financial Statements)

55

Financial Highlights—Advisor Class shares (for a share outstanding throughout each period)

Period Ended August 31,	Net asset value, beginning of period		Net investment income (loss)(4)			Net realized and unrealized gain (loss) on investments, options, futures contracts and foreign currency(4)			Total from investment operations			Distributions to shareholders from net investment income			Distributions to shareholders from net realized gain on investments, options, futures contracts and foreign currency transactions			Total distributions			Net asset value, end of period		Total return(1)(6)	Ratios to Average Net Assets(7)			Net assets, end of period (000 omitted)		Portfolio turnover rate(6)
																								Net Expenses	Expense waiver(2)	Net investment income (loss)(2)
Large-Cap Value Fund
2003(3)	$	12.12	$	0.24		$	0.42		$	0.66		$	(0.20	)	$	—		$	(0.20	)	$	12.58	5.56%	1.23%	0.25%	2.03%	$	5,757	62	%
2004(3)		12.58		0.30			1.62			1.92			(0.30	)		—			(0.30	)		14.20	15.39	1.22	0.25	2.30		10,255	103
2005(3)		14.20		0.32			1.01			1.33			(0.35	)		(0.72	)		(1.07	)		14.46	9.77	1.22	0.25	2.30		11,918	103
2006(3)		14.46		0.20			1.36			1.56			(0.20	)		(1.88	)		(2.08	)		13.94	11.99	1.23	0.05	1.47		12,110	121
2007(3)		13.94		0.18			1.55			1.73			(0.18	)		(1.19	)		(1.37	)		14.30	12.89	1.22	0.01	1.26		12,213	43
2008(3)(8)		14.30		0.08			(1.00	)		(0.92	)		(0.08	)		(0.69	)		(0.77	)		12.61	(6.93)	1.24	—	1.11		10,350	23
Large-Cap Growth Fund
2003(3)		10.59		0.04			0.71			0.75			(0.02	)		—			(0.02	)		11.32	7.11	1.28	0.25	0.37		6,349	73
2004(3)		11.32		0.02			0.78			0.80			(0.02	)		—			(0.02	)		12.10	7.08	1.25	0.25	0.20		8,126	129
2005(3)		12.10		0.08			1.55			1.63			(0.09	)		—			(0.09	)		13.64	13.51	1.26	0.25	0.63		8,796	146
2006(3)		13.64		0.00			0.40			0.40			(0.01	)		(1.87	)		(1.88	)		12.16	2.86	1.27	0.05	0.00		9,316	134
2007(3)		12.16		0.01			1.99			2.00			(0.00	)		(0.43	)		(0.43	)		13.73	16.68	1.27	0.01	0.09		9,454	75
2008(3)(8)		13.73		(0.01	)		(0.77	)		(0.78	)		(0.01	)		(1.14	)		(1.15	)		11.80	(6.77)	1.26	—	(0.14)		8,193	72
Mid-Cap Value Fund
2003(3)		10.65		0.01			1.86			1.87			(0.01	)		—			(0.01	)		12.51	17.63	1.27	0.25	0.13		5,428	39
2004(3)		12.51		0.05			2.14			2.19			(0.01	)		(0.45	)		(0.46	)		14.24	17.76	1.22	0.25	0.42		8,456	33
2005(3)		14.24		0.03			2.61			2.64			(0.06	)		(0.96	)		(1.02	)		15.86	19.16	1.20	0.25	0.25		12,497	37
2006(3)		15.86		0.07			0.70			0.77			(0.05	)		(1.50	)		(1.55	)		15.08	5.12	1.19	0.05	0.47		12,914	63
2007(3)		15.08		0.06			1.94			2.00			(0.07	)		(1.38	)		(1.45	)		15.63	13.52	1.21	0.01	0.37		12,782	62
2008(3)(8)		15.63		0.03			(1.41	)		(1.38	)		(0.06	)		(1.99	)		(2.05	)		12.20	(9.91)	1.23	—	0.41		9,853	20
Mid-Cap Growth Fund
2003(3)		9.31		(0.08	)		2.34			2.26			—			—			—			11.57	24.27	1.28	0.25	(0.79)		3,663	121
2004(3)		11.57		(0.10	)		(0.32	)		(0.42	)		—			—			—			11.15	(3.63)	1.24	0.25	(0.84)		4,209	240
2005(3)		11.15		(0.10	)		2.60			2.50			—			—			—			13.65	22.42	1.29	0.26	(0.72)		4,784	188
2006(3)		13.65		(0.10	)		0.88			0.78			—			—			—			14.43	5.71	1.30	0.05	(0.64)		4,396	134
2007(3)		14.43		(0.11	)		3.14			3.03			—			—			—			17.46	21.00	1.27	0.01	(0.61)		4,916	169
2008(8)		17.46		(0.06	)		(0.13	)		(0.19	)		—			—			—			17.27	(1.09)	1.26	—	(0.67)		4,896	85
Small-Cap Growth Fund
2003(3)		8.75		(0.07	)		3.15			3.08			—			—			—			11.83	35.20	1.72	0.25	(0.76)		3,763	248
2004(3)		11.83		(0.17	)		0.94			0.77			—			—			—			12.60	6.51	1.58	0.25	(1.29)		4,857	267
2005(3)		12.60		(0.18	)		3.60			3.42			—			—			—			16.02	27.14	1.55	0.26	(1.21)		6,173	195
2006(3)		16.02		(0.15	)		1.94			1.79			—			(1.37	)		(1.37	)		16.44	11.37	1.54	0.04	(0.93)		6,976	148
2007(3)		16.44		(0.17	)		4.07			3.90			—			(1.33	)		(1.33	)		19.01	24.73	1.53	0.01	(0.91)		7,992	176
2008(3)(8)		19.01		—			(1.20	)		(1.20	)		—			(3.32	)		(3.32	)		14.49	(8.47)	1.51	—	(1.01)		15,675	90
International Stock Fund
2003(3)		9.30		0.05			0.66			0.71			—			—			—			10.01	7.63	1.54	0.27	0.59		3,735	171
2004(3)		10.01		0.00			1.03			1.03			(0.04	)		—			(0.04	)		11.00	10.28	1.50	0.27	0.03		4,455	137
2005(3)		11.00		0.09			2.33			2.42			(0.07	)		—			(0.07	)		13.35	22.03	1.48	0.27	0.70		5,449	150
2006(3)		13.35		0.12			3.06			3.18			(0.12	)		—			(0.12	)		16.41	23.90	1.49	0.05	0.75		7,739	146
2007(3)		16.41		0.20			2.65			2.85			(0.04	)		(1.88	)		(1.92	)		17.34	18.37	1.45	0.02	1.23		7,771	98
2008(3)(8)		17.34		0.00			(1.34	)		(1.34	)		(0.20	)		(2.00	)		(2.20	)		13.80	(8.94)	1.47	—	(0.06)		6,754	38

(See Notes which are an integral part of the Financial Statements)

56

Financial Highlights—Advisor Class shares (for a share outstanding throughout each period)

Period Ended August 31,	Net asset value, beginning of period		Net investment income (loss)(4)		Net realized and unrealized gain (loss) on investments, options, futures contracts and foreign currency(4)			Total from investment operations		Distributions to shareholders from net investment income			Distributions to shareholders from net realized gain on investments, options, futures contracts and foreign currency transactions			Total distributions			Net asset value, end of period		Total return(1)(6)		Ratios to Average Net Assets(7)						Net assets, end of period (000 omitted)		Portfolio turnover rate(6)
																							Net Expenses		Expense waiver(2)		Net investment income (loss)(2)
Aggregate Bond Fund
2007(5)	$	10.00	$	0.11	$	0.09		$	0.20	$	(0.11	)	$	—		$	(0.11	)	$	10.09	2.00	%	0.80	%	0.14	%	4.38	%	$	20	129	%
2008(8)		10.09		0.24		0.18			0.42		(0.24	)		(0.06	)		(0.30	)		10.21	4.19		0.80		0.09		4.77			171	123
Government Income Fund
2003(3)		9.72		0.30		(0.09	)		0.21		(0.33	)		—			(0.33	)		9.60	2.22		1.10		0.35		3.06			4,615	539
2004(3)		9.60		0.41		0.08			0.49		(0.45	)		—			(0.45	)		9.64	5.26		1.10		0.35		4.30			5,579	113
2005(3)		9.64		0.34		(0.02	)		0.32		(0.36	)		—			(0.36	)		9.60	3.37		1.11		0.35		3.52			6,519	561
2006(3)		9.60		0.40		(0.18	)		0.22		(0.40	)		—			(0.40	)		9.42	2.34		1.09		0.15		4.27			6,425	760
2007(3)		9.42		0.41		0.01			0.42		(0.40	)		—			(0.40	)		9.44	4.53		1.07		0.11		4.27			5,808	686
2008(3)(8)		9.44		0.22		0.13			0.35		(0.22	)		—			(0.22	)		9.57	3.76		0.80		0.05		4.75			5,251	127
Short-Intermediate Bond Fund
2003(3)		9.44		0.39		0.06			0.45		(0.42	)		—			(0.42	)		9.47	4.86		0.95		0.31		4.05			5,403	317
2004(3)		9.47		0.39		0.02			0.41		(0.38	)		—			(0.38	)		9.50	4.44		0.95		0.31		4.06			6,865	279
2005(3)		9.50		0.33		(0.08	)		0.25		(0.35	)		—			(0.35	)		9.40	2.66		0.96		0.32		3.47			7,123	357
2006(3)		9.40		0.38		(0.17	)		0.21		(0.38	)		—			(0.38	)		9.23	2.33		0.96		0.11		4.16			6,549	430
2007(3)		9.23		0.40		(0.07	)		0.33		(0.40	)		—			(0.40	)		9.16	3.68		0.93		0.07		4.39			5,829	421
2008(8)		9.16		0.22		0.05			0.27		(0.22	)		—			(0.22	)		9.21	2.91		0.80		0.05		4.69			5,407	121
Short-Term Income Fund
2003(3)		9.42		0.30		(0.02	)		0.28		(0.38	)		—			(0.38	)		9.32	2.99		0.81		0.59		3.19			2,207	43
2004(3)		9.32		0.25		(0.02	)		0.23		(0.34	)		—			(0.34	)		9.21	2.51		0.77		0.59		2.70			2,914	40
2005(3)		9.21		0.25		(0.11	)		0.14		(0.32	)		—			(0.32	)		9.03	1.51		0.77		0.59		2.72			2,792	52
2006(3)		9.03		0.29		0.04			0.33		(0.36	)		—			(0.36	)		9.00	3.69		0.81		0.39		3.22			2,664	19
2007(3)		9.00		0.37		0.04			0.41		(0.39	)		—			(0.39	)		9.02	4.60		0.76		0.32		4.11			2,526	52
2008(3)(8)		9.02		0.20		0.16			0.36		(0.20	)		—			(0.20	)		9.18	4.08		0.60		0.19		4.50			2,134	22
Prime Money Market Fund
2003		1.00		0.01		—			0.01		(0.01	)		—			(0.01	)		1.00	0.75		0.75		0.03		0.74			93,059	—
2004		1.00		0.01		—			0.01		(0.01	)		—			(0.01	)		1.00	0.46		0.75		0.04		0.45			84,397	—
2005		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	1.91		0.75		0.04		1.90			75,993	—
2006		1.00		0.04		—			0.04		(0.04	)		—			(0.04	)		1.00	3.94		0.75		0.04		3.89			90,776	—
2007		1.00		0.05		—			0.05		(0.05	)		—			(0.05	)		1.00	4.75		0.75		0.02		4.65			115,093	—
2008(8)		1.00		0.02		—			0.02		(0.02	)		—			(0.02	)		1.00	2.13		0.75		0.02		4.23			157,196	—

(1) Based on net asset value, which does not reflect the sales charge, or contingent deferred sales charge, if applicable.

(2) This voluntary expense decrease is reflected in both the expense and net investment income (loss) ratios.

(3) Redemption fees consisted of the following per share amounts.

	Per Share Amount
Fund	2003		2004		2005		2006		2007		2008(8)
International Stock Fund	$	0.01	$	0.01	$	0.00	$	0.00	$	0.00	$	0.00

Funds not shown had redemption fees of less than $0.01.

(4) Per share information is based on average shares outstanding.

(5) Reflects operations for the period from June 1, 2007 (start of performance) to August 31, 2007.

(6) Not annualized for periods less than one year.

(7) Annualized for periods less than one year.

(8) For the six months ended February 29, 2008 (unaudited).

(See Notes which are an integral part of the Financial Statements)

57

Financial Highlights—Institutional Class shares (for a share outstanding throughout each period)

Period Ended August 31,	Net asset value, beginning of period		Net investment income (loss)(4)			Net realized and unrealized gain (loss) on investments, options, futures contracts and foreign currency(4)			Total from investment operations			Distributions to shareholders from net investment income			Distributions to shareholders from net realized gain on investments, options, futures contracts and foreign currency transactions			Total distributions			Net asset value, end of period		Total return(1)(5)	Ratios to Average Net Assets(7)				Net assets, end of period (000 omitted)		Portfolio turnover rate(5)
																								Net Expenses	Expense waiver(2)		Net investment income (loss)(2)
Large-Cap Value Fund
2008(10)	$	12.99	$	0.01		$	(0.39	)	$	(0.38	)	$	—		$	—		$	—		$	12.61	(2.93)%	1.04%	—	%	2.09%	$	103,301	23	%
Large-Cap Growth Fund
2008(10)		11.97		—			(0.17	)		(0.17	)		—			—			—			11.80	(1.42)	1.05	—		0.68		56,865	72
Mid-Cap Value Fund
2008(10)		12.55		0.01			(0.36	)		(0.35	)		—			—			—			12.20	(2.79)	1.00	—		1.09		72,393	20
Mid-Cap Growth Fund
2008(10)		17.09		—			0.19			0.19			—			—			—			17.28	1.11	1.06	—		(0.12)		40,069	85
Small-Cap Growth Fund
2008(10)		14.73		(0.01	)		(0.23	)		(0.24	)		—			—			—			14.49	(1.63)	1.32	—		(0.63)		64,183	90
International Stock Fund
2003(3)		9.37		0.08			0.66			0.74			—			—			—			10.11	7.90	1.29	0.02		0.90		116,761	171
2004(3)		10.11		0.04			1.02			1.06			(0.06	)		—			(0.06	)		11.11	10.52	1.25	0.02		0.36		242,089	137
2005(3)		11.11		0.16			2.32			2.48			(0.07	)		—			(0.07	)		13.52	22.38	1.23	0.02		0.95		168,128	150
2006(3)		13.52		0.17			3.07			3.24			(0.15	)		—			(0.15	)		16.61	24.14	1.24	0.02		1.00		188,715	146
2007(3)		16.61		0.24			2.68			2.92			(0.07	)		(1.88	)		(1.95	)		17.58	18.65	1.20	0.02		1.48		250,012	98
2008(3)(11)		17.58		0.03			(1.33	)		(1.30	)		(0.24	)		(2.00	)		(2.24	)		14.04	(8.56)	1.22	—		0.19		317,538	38
Aggregate Bond Fund
2007(9)		10.00		0.12			0.10			0.22			(0.12	)		—			(0.12	)		10.10	2.18	0.55	0.14		4.63		143,657	129
2008(11)		10.10		0.25			0.17			0.42			(0.25	)		(0.06	)		(0.31	)		10.21	4.21	0.55	0.09		5.02		187,996	123
Government Income Fund
2007(9)		9.41		0.11			0.03			0.14			(0.11	)		—			(0.11	)		9.44	1.54	0.55	0.13		4.87		141,305	686
2008(3)(11)		9.44		0.23			0.13			0.36			(0.23	)		—			(0.23	)		9.57	3.89	0.55	0.05		5.00		316,622	127
Short-Intermediate Bond Fund
2007(9)		9.17		0.11			(0.01	)		0.10			(0.11	)		—			(0.11	)		9.16	1.12	0.55	0.08		4.90		181,534	421
2008(3)(11)		9.16		0.22			0.05			0.27			(0.22	)		—			(0.22	)		9.21	3.04	0.55	0.05		4.94		369,930	121
Short-Term Income Fund
2007(9)		9.02		0.11			—			0.11			(0.11	)		—			(0.11	)		9.02	1.20	0.35	0.23		4.65		41,186	52
2008(11)		9.02		0.22			0.16			0.38			(0.22	)		—			(0.22	)		9.18	4.20	0.35	0.19		4.75		85,876	22
Prime Money Market Fund
2003		1.00		0.01			—			0.01			(0.01	)		—			(0.01	)		1.00	1.30	0.20	0.03		1.26		1,302,242	—
2004		1.00		0.01			—			0.01			(0.01	)		—			(0.01	)		1.00	1.01	0.20	0.04		1.01		1,532,640	—
2005		1.00		0.02			—			0.02			(0.02	)		—			(0.02	)		1.00	2.47	0.20	0.04		2.45		1,550,128	—
2006		1.00		0.04			—			0.04			(0.04	)		—			(0.04	)		1.00	4.51	0.20	0.04		4.44		1,653,556	—
2007		1.00		0.05			—			0.05			(0.05	)		—			(0.05	)		1.00	5.33	0.20	0.02		5.20		2,080,429	—
2008(11)		1.00		0.02			—			0.02			(0.02	)		—			(0.02	)		1.00	2.41	0.20	0.02		4.78		2,942,169	—
Government Money Market Fund
2004(6)		1.00		—			—			—			—			—			—			1.00	0.28	0.20	0.17		1.18		64,212	—
2005		1.00		0.02			—			0.02			(0.02	)		—			(0.02	)		1.00	2.37	0.20	0.18		2.34		37,372	—
2006		1.00		0.04			—			0.04			(0.04	)		—			(0.04	)		1.00	4.42	0.20	0.17		4.34		65,616	—
2007		1.00		0.05			—			0.05			(0.05	)		—			(0.05	)		1.00	5.25	0.20	0.13		5.13		136,910	—
2008(11)		1.00		0.02			—			0.02			(0.02	)		—			(0.02	)		1.00	2.24	0.20	0.11		4.42		307,098	—
Tax-Free Money Market Fund
2005(8)		1.00		—			—			—			—			—			—			1.00	0.39	0.20	0.06		0.78		24,211	—
2006		1.00		0.03			—			0.03			(0.03	)		—			(0.03	)		1.00	3.09	0.20	0.13		3.10		116,409	—
2007		1.00		0.04			—			0.04			(0.04	)		—			(0.04	)		1.00	3.59	0.20	0.13		3.53		243,842	—
2008(11)		1.00		0.02			—			0.02			(0.02	)		—			(0.02	)		1.00	1.67	0.20	0.10		3.32		395,426	—

(1) Based on net asset value.

(2) This voluntary expense decrease is reflected in both the expense and net investment income (loss) ratios.

(See Notes which are an integral part of the Financial Statements)

58

Financial Highlights—Institutional Class shares (for a share outstanding throughout each period)

(3) Redemption fees consisted of the following per share amounts.

	Per Share Amount
Fund	2003		2004		2005		2006		2007		2008(11)
International Stock Fund	$	0.01	$	0.00	$	0.00	$	0.00	$	0.00	$	0.00

Funds not shown had redemption fees of less than $0.01.

(4) Per share information is based on average shares outstanding.

(5) Not annualized for periods less than one year.

(6) Reflects operations for the period from May 28, 2004 (start of performance) to August 31, 2004.

(7) Annualized for periods less than one year.

(8) Reflects operations for the period from June 29, 2005 (start of performance) to August 31, 2005.

(9) Reflects operations for the period from June 1, 2007 (start of performance) to August 31, 2007.

(10) Reflects operations for the period from February 1, 2008 (start of performance) to February 29, 2008.

(11) For the six months ended February 29, 2008 (unaudited).

(See Notes which are an integral part of the Financial Statements)

59

February 29, 2008 (Unaudited)

Notes to Financial Statements

1. Organization

Marshall Funds, Inc. (the “Corporation”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. The Corporation consists of fourteen diversified portfolios (individually referred to as the “Fund,” or collectively as the “Funds”), with multiple classes of shares as indicated in the accompanying table:

Portfolio Name	Advisor Class	Investor Class	Institutional Class	Investment Objective
Marshall Large-Cap Value Fund (“Large-Cap Value Fund”)	X	X	X*	To provide capital appreciation and above-average dividend income.
Marshall Large-Cap Growth Fund (“Large-Cap Growth Fund”)	X	X	X*	To provide capital appreciation.
Marshall Mid-Cap Value Fund (“Mid-Cap Value Fund”)	X	X	X*	To provide capital appreciation.
Marshall Mid-Cap Growth Fund (“Mid-Cap Growth Fund”)	X	X	X*	To provide capital appreciation.
Marshall Small-Cap Growth Fund (“Small-Cap Growth Fund”)	X	X	X*	To provide capital appreciation.
Marshall International Stock Fund (“International Stock Fund”)	X	X	X	To provide capital appreciation.
Marshall Aggregate Bond Fund (“Aggregate Bond Fund”)	X	X	X	To maximize total return consistent with current income.
Marshall Government Income Fund (“Government Income Fund”)	X	X	X	To provide current income.
Marshall Intermediate Tax-Free Fund (“Intermediate Tax-Free Fund”)		X		To provide a high level of current income that is exempt from federal income tax and is consistent with preservation of capital.
Marshall Short-Intermediate Bond Fund (“Short-Intermediate Bond Fund”)	X	X	X	To maximize total return consistent with current income.
Marshall Short-Term Income Fund (“Short-Term Income Fund”)	X	X	X	To maximize total return consistent with current income.
Marshall Prime Money Market Fund (“Prime Money Market Fund”)	X	X	X	To provide current income consistent with stability of principal.
Marshall Government Money Market Fund (“Government Money Market Fund”)		X	X	To provide current income consistent with stability of principal.
Marshall Tax-Free Money Market Fund (“Tax-Free Money Market Fund”)		X	X	To provide current income that is exempt from federal income tax and is consistent with stability of principal.

* Commenced operations on February 1, 2008.

2. Significant Accounting Policies

The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements.

Use of Estimates—The preparation of financial statements in conformity with accounting principles generally accepted (“GAAP”) in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results may differ from those estimates.

Investment Valuations—Listed equity securities are valued each trading day at the last sale price or official closing price reported on a national securities exchange, including NASDAQ. Securities listed on a foreign exchange are valued each trading day at the last closing price on the principal exchange on which they are traded immediately prior to the time for determination of NAV or at fair value as discussed below. Equity securities without a reported trade, U.S. government securities, listed corporate bonds, other fixed income and asset-backed securities with maturities of 60 days or more, unlisted securities and private placement securities are generally valued at the mean of the latest bid and asked price as furnished by an independent pricing service. Municipal bonds are valued by an independent pricing service, taking into consideration yield, liquidity, risk, credit quality, coupon, maturity, type of issue and any other factors or market data the pricing service deems relevant. The money market funds use the amortized cost method to value portfolio securities in accordance with Rule 2a-7 under the Act. Fixed income securities with remaining maturities of 60 days or less at the time of purchase are valued at amortized cost, which approximates fair value. Investments in other open-end registered investment companies are valued at net asset value.

60

Notes to Financial Statements (continued)

Securities or other assets for which market valuations are not readily available, or are deemed to be inaccurate, are valued at fair value as determined in good faith using methods approved by the Board of Directors (the “Directors”). The Directors have established a Pricing Committee, which is responsible for determinations of fair value, subject to the supervision of the Directors. In determining fair value, the Pricing Committee takes into account all information available and any factors it deems appropriate. Consequently, the price of securities used by a Fund to calculate its NAV may differ from quoted or published prices for the same securities. Fair value pricing involves subjective judgments and it is possible that the fair value determined for a security is materially different than the value that could be realized upon the sale of that security and the differences may be material to the NAV of the respective Fund or the financial statements presented.

Securities held in the International Stock Fund may be listed on foreign exchanges that do not value their listed securities at the same time that the Fund calculates its NAV. Most foreign markets close well before the Fund values its securities, generally 3:00 p.m. (Central Time). The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, may have occurred in the interim, which may affect a security’s value.

The Pricing Committee may determine that a security needs to be fair valued if, among other things, it believes the value of the security might have been materially affected by events occurring after the close of the market in which the security was principally traded, but before the time for determination of the NAV (“a subsequent event”). A subsequent event might include a company-specific development (for example, announcement of a merger that is made after the close of the foreign market), a development that might affect an entire market or region (for example, weather related events) or a potentially global development (such as a terrorist attack that may be expected to have an effect on investor expectations worldwide). The Directors have retained an independent fair value pricing service to assist in valuing foreign securities. The service utilizes statistical data based on historical performance of securities, markets and other data in developing factors used to estimate a fair value. As of February 29, 2008, 89.8% of the total long-term investments of the International Stock Fund were fair valued; none of the securities held in the other Funds were fair valued.

Repurchase Agreements—The Funds’ policy requires the custodian bank to take possession, to have legally segregated in the Federal Reserve Book Entry System, or to have segregated within the custodian bank’s vault, all securities held as collateral under repurchase agreement transactions. Additionally, procedures have been established by the Funds to monitor, on a daily basis, the market value of each repurchase agreement’s collateral to ensure that the value of collateral at least equals the repurchase price to be paid under the repurchase agreement, including accrued interest.

The Funds will only enter into repurchase agreements with banks and other recognized financial institutions, such as broker-dealers, which are deemed by the Funds’ adviser (or sub-adviser with respect to International Stock Fund) to be creditworthy pursuant to the guidelines and/or standards reviewed or established by the Directors. Risks may arise from the potential inability of counterparties to honor the terms of the repurchase agreement. Accordingly, the Funds could receive less than the repurchase price on the sale of collateral securities.

Investment Income, Expenses and Distributions—Interest income and expenses are accrued daily. Dividend income and distributions to shareholders are recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at fair market value.

The Funds (except Intermediate Tax-Free Fund) offer multiple classes of shares which differ in their respective distribution and service fees. All shareholders bear the common expenses of the Funds. Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in class-specific expenses. Income, non-class specific expenses and realized and unrealized gains and losses are allocated daily to each class of shares based on the total shares outstanding of each class, without distinction between share classes. Expenses attributable to a particular class of shares, such as distribution fees and shareholder servicing fees are allocated directly to that class.

Premium and Discount Amortization/Paydown Gains and Losses—All premiums and discounts on fixed income securities are amortized/accreted for tax and financial statement purposes. Gains and losses realized on principal payments of mortgage-backed securities (paydown gains and losses) are classified as part of net investment income.

Federal Income Taxes—It is the Funds’ policy to comply with the Subchapter M provision of the Internal Revenue Code (the “Code”) and to distribute to shareholders each year substantially all of their income. Accordingly, no provisions for federal tax are necessary.

Withholding taxes on foreign dividends have been provided in accordance with the applicable country’s tax rules and rates.

When-Issued and Delayed Delivery Transactions—The Funds may engage in when-issued or delayed delivery transactions. The Funds record when-issued securities on the trade date and maintain security positions such that sufficient liquid assets will be available to make payment for the commitment to purchase securities. Securities purchased on a when-issued or delayed delivery basis are marked-to-market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.

Futures Contracts—Certain Funds may purchase futures contracts to manage cash flows, enhance yield, and to potentially reduce transaction costs. Upon entering into a futures contract with a broker, the Fund is required to deposit in a segregated account a specified amount of cash or U.S. government securities. Futures contracts are valued daily and unrealized gains or losses are recorded in a “variation margin” account. Daily, the Fund receives from or pays to the broker a specified amount of cash based upon changes in the variation margin account. When a contract is closed, the Fund recognizes a realized gain or loss. Futures contracts have market risks, including the risk that the change in the value of the contract may not correlate with changes in the value of the underlying securities.

61

Marshall Funds

At February 29, 2008, the following Fund had an outstanding futures contract as set forth below:

Fund	Expiration Date	Contracts	Description	Position	Unrealized Appreciation
Short-Term Income Fund	June 2008	175	U.S. 5 Year Note	Long	$	270,073

Options Contracts—Certain Funds may write covered call and put options on futures, swaps, securities or currencies a Fund owns, or in which it may invest. Writing put options tends to increase a Fund’s exposure to the underlying instrument. Writing call options tends to decrease a Fund’s exposure to the underlying instrument. When a Fund writes a call or put option, an amount equal to the premium received is recorded as a liability and subsequently marked to market to reflect the current value of the option written. These liabilities are reflected as written options outstanding in the Statements of Assets and Liabilities. Payments received or made, if any, from writing options with premiums to be determined on a future date are reflected as such on the Statements of Assets and Liabilities. Premiums received from writing options which expire are treated as realized gains. Premiums received from writing options which are exercised or closed are added to the proceeds or offset against amounts paid on the underlying future, swap, security or currency transaction to determine the realized gain or loss. A Fund, as a writer of an option, has no control over whether the underlying future, swap, security or currency may be sold (call) or purchased (put) and, as a result, bears the market risk of an unfavorable change in the price of the future, swap, security or currency underlying the written option. The risk exists that a Fund may not be able to enter into a closing transaction because of an illiquid market.

Certain Funds may also purchase put and call options. Purchasing call options tends to increase a Fund’s exposure to the underlying instrument. Purchasing put options tends to decrease a Fund’s exposure to the underlying instrument. A Fund pays a premium which is included in a Fund’s Statement of Assets and Liabilities as an investment and subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options which expire are treated as realized losses. The risk associated with purchasing put and call options is limited to the premium paid. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying future, swap, security or currency transaction to determine the realized gain or loss.

For the period ended February 29, 2008, the Large-Cap Value Fund had $410,712 in realized losses on all options.

The following is a summary of the Large-Cap Value Fund’s written option activity:

Contracts	Number of Contracts		Premium
Outstanding @ 8/31/07	5,467		$	1,026,894
Options written	7,792			1,563,680
Options expired	(3,697	)		(604,141	)
Options exercised	(714	)		(195,005	)
Options closed	(4,829	)		(973,851	)
Outstanding @ 2/29/08	4,019		$	817,577

At February 29, 2008, the Large-Cap Value Fund had the following outstanding written options:

Contracts	Type	Expiration Date	Exercise Price		Number of Contracts	Market Value		Unrealized Appreciation (Depreciation)
Apache Corp.	Call	April 2008	$	125	200	$	54,000	$	(29,600	)
Deere & Co.	Call	March 2008		100	150		—		18,300
Devon Energy Corp.	Call	April 2008		110	210		63,525		(35,805	)
Freeport-McMoRan Copper & Gold, Inc.	Call	March 2008		110	300		41,850		(14,902	)
Goldman Sachs Group, Inc.	Call	April 2008		270	233		—		149,756
Hess Corp.	Call	March 2008		105	60		3,450		3,870
Lehman Brothers Holdings, Inc.	Call	April 2008		80	709		—		129,036
Morgan Stanley	Call	July 2008		60	100		5,250		1,550
Chevron Corp.	Put	March 2008		75	1,580		19,750		335,854
Morgan Stanley	Put	March 2008		40	477		52,470		19,223
Total					4,019			$	577,282

62

Notes to Financial Statements (continued)

Foreign Exchange Contracts—Certain Funds may enter into foreign currency exchange contracts as a way of managing foreign exchange rate risk. Certain Funds may enter into these contracts for the purchase or sale of a specific foreign currency at a fixed price on a future date as a hedge or cross hedge against either specific transactions or portfolio positions. The objective of certain Funds’ foreign currency hedging transactions is to reduce the risk that the U.S. dollar value of these Funds’ foreign currency denominated securities will decline in value due to changes in foreign currency exchange rates. All foreign currency exchange contracts are “marked-to-market” daily at the applicable translation rates resulting in unrealized gains or losses. Realized gains or losses are recorded at the time the foreign currency exchange contract is offset by entering into a closing transaction or by the delivery or receipt of the currency. Risk may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.

Foreign Currency Translation—The accounting records of the Funds are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies (“FC”) are translated into U.S. dollars based on the rate of exchange of such currencies against U.S. dollars on the date of valuation. Purchases and sales of securities, income and expenses are translated at the rate of exchange quoted on the respective date that such transactions are recorded. The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales of portfolio securities, sales and maturities of short-term securities, sales of FCs, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Funds’ books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities other than investments in securities at fiscal year end, resulting from changes in the exchange rate.

Securities Lending—Certain Funds participate in a securities lending program providing for the lending of corporate bonds, equity and government securities to qualified brokers. The Funds receive cash as collateral in return for the securities and record a corresponding payable for collateral due to the respective broker. The amount of cash collateral received is maintained at a minimum level of 100% of the prior day’s market value on securities loaned. Collateral is reinvested in short-term securities including overnight repurchase agreements, commercial paper, master notes, floating rate corporate notes (with at least quarterly reset rates) and money market funds. On May 18, 2000, the Securities and Exchange Commission issued an order to the Marshall Funds that exempts certain securities lending activities from prohibitions under the Act. Under the terms of the exemptive order, (i) the Funds may pay a portion of net revenue to Marshall & Ilsley Trust Company N.A. (“M&I Trust”) for its services as securities lending agent, and (ii) cash collateral received for a loan of one Fund’s securities may be invested jointly with collateral received for loans of other Funds’ securities.

63

Marshall Funds

Cash collateral was jointly pooled and invested in the following securities as of February 29, 2008 (1):

Alliance & Leicester PLC, 3.213%, 3/10/2008			$	19,800,000
Allstate Life Global Fd II, 3.219%, 3/17/2008				19,986,000
American Express Credit, 3.241%, 3/5/2008				20,000,000
American General Finance, 3.181%, 3/17/2008				19,995,200
Aust. & N.Z. Banking Group, 3.155%, 3/24/2008				19,980,560
Banco Santander Totta LN, 3.129%, 3/17/2008				14,989,200
Barclays Capital Repo, 3.050%, 3/3/2008				4,000,000
Bayerische Landesbank NY, 3.195%, 3/24/2008				19,950,000
Bear Stearns Co., 3.185%, 3/28/2008				5,884,686
Bear Stearns Co., 3.241%, 3/5/2008				14,820,000
BMW US Capital LLC, 3.141%, 3/17/2008				21,988,560
Canadian Imperial Bank, 3.211%, 3/17/2008				15,003,600
Citigroup Funding, Inc., 3.210%, 3/3/2008				24,981,957
Credit Suisse First Boston, 3.335%, 3/3/2008				19,932,200
DNB NOR Bank ASA, 3.135%, 3/25/2008				19,956,740
Dreyfus Money Market Fund, 3.497%, 3/3/2008				5,000,000
Greenwich Capital Holdings, 3.275%, 3/3/2008				20,000,000
HBOS Treasury Services PLC, 3.334%, 3/3/2008				19,981,200
HSBC Finance Corp., 3.185%, 3/24/2008				14,998,050
HSH Nordbank NY, 3.195%, 3/23/2008				19,986,600
IBM Corp., 3.223%, 3/10/2008				19,977,800
ING USA Annuity and Life, 3.285%, 3/26/2008				20,000,000
Irish Life & Permanent, 3.148%, 3/24/2008				19,968,800
Metlife Insurance FA, 3.314%, 3/3/2008				20,000,000
National City Bank, 3.345%, 3/3/2008				29,820,000
National Rural Utilities Coop., 3.274%, 3/3/2008				20,000,000
Northern Rock PLC, 3.214%, 3/3/2008				19,719,600
Provident Money Market Fund, 3.758%, 3/3/2008				438,086,930
SLM Corp., 3.124%, 3/20/2008				19,856,400
Unilever Capital Corp., 3.144%, 3/12/2008				14,984,355
Wachovia Securities LLP, 3.210%, 3/3/2008				15,000,000
Westlb AG NY FRN, 3.225%, 3/10/2008				14,981,415
Westpac Bank NY, 5.201%, 3/18/2008				10,000,800
Total			$	1,003,630,653
Fund	Value of Securities Loaned		Payable on Collateral Due to Brokers
Large-Cap Value Fund	$	28,784,025	$	29,413,277
Large-Cap Growth Fund		40,450,326		41,334,610
Mid-Cap Value Fund		53,281,218		54,445,999
Mid-Cap Growth Fund		58,856,121		60,142,774
Small-Cap Growth Fund		126,168,315		128,926,480
International Stock Fund		97,535,575		99,667,797
Aggregate Bond Fund		88,058,227		89,983,266
Government Income Fund		337,159,863		344,530,509
Short-Intermediate Bond Fund		134,448,974		137,388,161
Short-Term Income Fund		17,417,027		17,797,780
Total	$	982,159,671	$	1,003,630,653

(1) The collateral pool is managed by the fund manager of the Short-Term Income, Prime Money Market and Government Money Market Funds, at no cost to the Funds.

64

Notes to Financial Statements (continued)

Restricted Securities—Restricted securities are securities that may be resold only upon registration under federal securities laws or in transactions exempt from such registration. In some cases, the issuer of restricted securities has agreed to register such securities for resale, at the issuer’s expense either upon demand by the Funds or in connection with another registered offering of the securities. Many restricted securities may be resold in the secondary market in transactions exempt from registration. Such restricted securities may be determined to be liquid under criteria established by the Directors. The restricted securities are valued at the price provided by dealers in the secondary market or, if no market prices are available, the fair value as determined in good faith using methods approved by the Directors. The money market funds’ restricted securities are valued at amortized cost in accordance with Rule 2a-7 under the Act.

Additional information on each illiquid restricted security held by the Funds at February 29, 2008 is as follows:

Fund	Security	Acquisition Date	Acquisition Cost		Value
Short-Term Income Fund	Pegasus Aviation Lease Securitization	5/5/1999	$	750,654	$	285,248
Prime Money Market Fund	Genworth Life Insurance Co.	4/20/2004		75,000,000		75,000,000
Prime Money Market Fund	Metropolitan Life Insurance Co.	5/3/2004		65,000,000		65,000,000
Prime Money Market Fund	Metropolitan Life Insurance Co.	1/30/2004		50,000,000		50,000,000
Prime Money Market Fund	ING USA Annuity & Life Insurance Co.	6/20/2007		150,000,000		150,000,000
Tax-Free Money Market Fund	Municipal Securities Trust	1/11/2008		6,245,000		6,245,000

Redemption Fees—The Funds (other than the Prime Money Market Fund, Government Money Market Fund, and Tax-Free Money Market Fund) impose a 2.00% redemption fee to shareholders who redeem shares held for 30 days or less. All redemption fees are recorded by the Funds as paid-in-capital.

Commitments and Contingencies—In the normal course of business, the Corporation enters into contracts that provide general indemnifications to other parties. The Corporation’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Corporation that have not yet occurred. However, the Corporation has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.

Other—Investment transactions are accounted for on a trade date basis. Net realized gains and losses on securities are computed on the basis of specific security lot identification.

3. Capital Stock

The Articles of Incorporation permit the Directors to issue an indefinite number of full and fractional shares of common stock, par value $0.0001 per share. Transactions in capital stock were as follows:

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
LARGE-CAP VALUE FUND—INVESTOR CLASS
Shares sold	1,188,293		$	16,126,729		2,698,850		$	38,343,945
Shares issued to shareholders in payment of distributions declared	1,124,720			15,669,648		2,068,517			28,602,716
Shares redeemed	(10,639,590	)		(136,812,565	)	(4,689,928	)		(67,038,896	)
Net change resulting from Investor Class Share transactions	(8,326,577	)	$	(105,016,188	)	77,439		$	(92,235	)
LARGE-CAP VALUE FUND—ADVISOR CLASS
Shares sold	21,834		$	313,334		103,705		$	1,479,871
Shares issued to shareholders in payment of distributions declared	43,424			605,674		82,825			1,146,503
Shares redeemed	(98,552	)		(1,353,878	)	(201,179	)		(2,890,619	)
Net change resulting from Advisor Class Share transactions	(33,294	)	$	(434,870	)	(14,649	)	$	(264,245	)

65

Marshall Funds

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
LARGE-CAP VALUE FUND—INSTITUTIONAL CLASS(1)
Shares sold	8,300,067		$	104,003,267		—		$	—
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(109,406	)		(1,396,460	)	—			—
Net change resulting from Institutional Class Share transactions	8,190,661		$	102,606,807		—		$	—
Net change resulting from Fund Share transactions	(169,210	)	$	(2,844,251	)	62,790		$	(356,480	)
LARGE-CAP GROWTH FUND—INVESTOR CLASS
Shares sold	1,630,496		$	20,786,742		2,031,750		$	26,701,351
Shares issued to shareholders in payment of distributions declared	1,449,855			19,631,901		554,491			7,179,880
Shares redeemed	(5,913,468	)		(70,795,741	)	(2,536,676	)		(33,365,728	)
Net change resulting from Investor Class Share transactions	(2,833,117	)	$	(30,377,098	)	49,565		$	515,503
LARGE-CAP GROWTH FUND—ADVISOR CLASS
Shares sold	23,209		$	323,486		95,919		$	1,248,816
Shares issued to shareholders in payment of distributions declared	55,129			746,491		25,046			324,308
Shares redeemed	(72,519	)		(955,017	)	(198,139	)		(2,622,672	)
Net change resulting from Advisor Class Share transactions	5,819		$	114,960		(77,174	)	$	(1,049,548	)
LARGE-CAP GROWTH FUND—INSTITUTIONAL CLASS(1)
Shares sold	4,845,873		$	56,510,215		—		$	—
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(24,922	)		(297,905	)	—			—
Net change resulting from Institutional Class Share transactions	4,820,951		$	56,212,310		—		$	—
Net change resulting from Fund Share transactions	1,993,653		$	25,950,172		(27,609	)	$	(534,045	)
MID-CAP VALUE FUND—INVESTOR CLASS
Shares sold	1,421,392		$	19,935,487		4,506,982		$	71,541,427
Shares issued to shareholders in payment of distributions declared	4,632,735			61,903,018		3,441,995			52,448,707
Shares redeemed	(16,750,047	)		(228,336,010	)	(10,846,661	)		(172,476,227	)
Net change resulting from Investor Class Share transactions	(10,695,920	)	$	(146,497,505	)	(2,897,684	)	$	(48,486,093	)

66

Notes to Financial Statements (continued)

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
MID-CAP VALUE FUND—ADVISOR CLASS
Shares sold	53,473		$	744,230		146,318		$	2,306,905
Shares issued to shareholders in payment of distributions declared	108,301			1,447,171		77,101			1,174,830
Shares redeemed	(171,742	)		(2,445,411	)	(262,011	)		(4,171,856	)
Net change resulting from Advisor Class Share transactions	(9,968	)	$	(254,010	)	(38,592	)	$	(690,121	)
MID-CAP VALUE FUND—INSTITUTIONAL CLASS(1)
Shares sold	6,085,767		$	75,160,120		—		$	—
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(152,050	)		(1,895,709	)	—			—
Net change resulting from Institutional Class Share transactions	5,933,717		$	73,264,411		—		$	—
Net change resulting from Fund Share transactions	(4,772,171	)	$	(73,487,104	)	(2,936,276	)	$	(49,176,214	)
MID-CAP GROWTH FUND—INVESTOR CLASS
Shares sold	2,274,309		$	41,192,536		2,540,798		$	41,115,818
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(3,242,988	)		(56,020,484	)	(1,982,445	)		(31,888,170	)
Net change resulting from Investor Class Share transactions	(968,679	)	$	(14,827,948	)	558,353		$	9,227,648
MID-CAP GROWTH FUND—ADVISOR CLASS
Shares sold	26,142		$	482,722		29,141		$	466,156
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(24,183	)		(442,288	)	(52,183	)		(849,393	)
Net change resulting from Advisor Class Share transactions	1,959		$	40,434		(23,042	)	$	(383,237	)
MID-CAP GROWTH FUND—INSTITUTIONAL CLASS(1)
Shares sold	2,335,953		$	39,432,339		—		$	—
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(17,216	)		(299,793	)	—			—
Net change resulting from Institutional Class Share transactions	2,318,737		$	39,132,546		—		$	—
Net change resulting from Fund Share transactions	1,352,017		$	24,345,032		535,311		$	8,844,411

67

Marshall Funds

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
SMALL-CAP GROWTH FUND—INVESTOR CLASS
Shares sold	2,449,309		$	42,256,656		2,892,676		$	51,671,522
Shares issued to shareholders in payment of distributions declared	2,739,815			45,371,334		887,422			15,050,676
Shares redeemed	(5,759,613	)		(86,196,673	)	(2,064,509	)		(37,030,747	)
Net change resulting from Investor Class Share transactions	(570,489	)	$	1,431,317		1,715,589		$	29,691,451
SMALL-CAP GROWTH FUND—ADVISOR CLASS
Shares sold	646,432		$	10,508,690		101,335		$	1,794,453
Shares issued to shareholders in payment of distributions declared	82,746			1,370,278		31,786			539,101
Shares redeemed	(67,673	)		(1,114,448	)	(137,092	)		(2,450,947	)
Net change resulting from Advisor Class Share transactions	661,505		$	10,764,520		(3,971	)	$	(117,393	)
SMALL-CAP GROWTH FUND—INSTITUTIONAL CLASS(1)
Shares sold	4,455,486		$	64,523,227		—		$	—
Shares issued to shareholders in payment of distributions declared	—			—		—			—
Shares redeemed	(26,653	)		(394,162	)	—			—
Net change resulting from Institutional Class Share transactions	4,428,833		$	64,129,065		—		$	—
Net change resulting from Fund Share transactions	4,519,849		$	76,324,902		1,711,618		$	29,574,058
INTERNATIONAL STOCK FUND—INVESTOR CLASS
Shares sold	753,010		$	12,181,999		2,619,474		$	44,213,946
Shares issued to shareholders in payment of distributions declared	1,964,939			29,945,667		1,648,897			26,283,427
Shares redeemed	(9,122,642	)		(125,760,696	)	(3,029,744	)		(52,106,825	)
Net change resulting from Investor Class Share transactions	(6,404,693	)	$	(83,633,030	)	1,238,627		$	18,390,548
INTERNATIONAL STOCK FUND—ADVISOR CLASS
Shares sold	29,306		$	464,821		51,800		$	880,705
Shares issued to shareholders in payment of distributions declared	60,409			920,629		49,373			787,005
Shares redeemed	(48,621	)		(779,450	)	(124,418	)		(2,106,532	)
Net change resulting from Advisor Class Share transactions	41,094		$	606,000		(23,245	)	$	(438,822	)
INTERNATIONAL STOCK FUND—INSTITUTIONAL CLASS
Shares sold	7,912,855		$	109,011,173		3,046,613		$	51,959,049
Shares issued to shareholders in payment of distributions declared	2,065,052			31,946,356		1,411,821			22,786,780
Shares redeemed	(1,574,342	)		(24,789,144	)	(1,600,543	)		(27,779,259	)
Net change resulting from Institutional Class Share transactions	8,403,565		$	116,168,385		2,857,891		$	46,966,570
Net change resulting from Fund Share transactions	2,039,966		$	33,141,355		4,073,273		$	64,918,296

68

Notes to Financial Statements (continued)

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
AGGREGATE BOND FUND—INVESTOR CLASS(2)
Shares sold	3,612,002		$	36,902,101		5,956,110		$	59,561,312
Shares issued to shareholders in payment of distributions declared	179,622			1,839,364		52,417			525,296
Shares redeemed	(2,991,378	)		(30,653,310	)	(162,840	)		(1,626,228	)
Net change resulting from Investor Class Share transactions	800,246		$	8,088,155		5,845,687		$	58,460,380
AGGREGATE BOND FUND—ADVISOR CLASS(2)
Shares sold	15,573		$	159,756		1,969		$	19,638
Shares issued to shareholders in payment of distributions declared	194			1,991		8			82
Shares redeemed	(978	)		(9,932	)	—			—
Net change resulting from Advisor Class Share transactions	14,789		$	151,815		1,977		$	19,720
AGGREGATE BOND FUND—INSTITUTIONAL CLASS(2)
Shares sold	4,024,352		$	41,160,175		14,632,665		$	146,316,384
Shares issued to shareholders in payment of distributions declared	456,126			4,670,295		163,102			1,634,119
Shares redeemed	(299,106	)		(3,054,264	)	(565,395	)		(5,657,828	)
Net change resulting from Institutional Class Share transactions	4,181,372		$	42,776,206		14,230,372		$	142,292,675
Net change resulting from Fund Share transactions	4,996,407		$	51,016,176		20,078,036		$	200,772,775
GOVERNMENT INCOME FUND—INVESTOR CLASS
Shares sold	6,531,263		$	62,500,545		20,415,133		$	192,946,936
Shares issued to shareholders in payment of distributions declared	935,029			8,952,677		2,053,764			19,427,414
Shares redeemed	(24,860,919	)		(238,935,513	)	(25,970,107	)		(243,689,339	)
Net change resulting from Investor Class Share transactions	(17,394,627	)	$	(167,482,291	)	(3,501,210	)	$	(31,314,989	)
GOVERNMENT INCOME FUND—ADVISOR CLASS
Shares sold	24,886		$	237,420		111,781		$	1,057,950
Shares issued to shareholders in payment of distributions declared	10,756			102,951		23,522			222,490
Shares redeemed	(102,385	)		(975,963	)	(201,970	)		(1,907,638	)
Net change resulting from Advisor Class Share transactions	(66,743	)	$	(635,592	)	(66,667	)	$	(627,198	)
GOVERNMENT INCOME FUND—INSTITUTIONAL CLASS(2)
Shares sold	19,078,800		$	183,450,634		15,554,163		$	145,052,928
Shares issued to shareholders in payment of distributions declared	383,829			3,674,249		150,818			1,417,563
Shares redeemed	(1,357,789	)		(13,022,739	)	(736,125	)		(6,911,485	)
Net change resulting from Institutional Class Share transactions	18,104,840		$	174,102,144		14,968,856		$	139,559,006
Net change resulting from Fund Share transactions	643,470		$	5,984,261		11,400,979		$	107,616,819

69

Marshall Funds

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
INTERMEDIATE TAX-FREE FUND—INVESTOR CLASS
Shares sold	1,282,314		$	12,914,579		1,930,352		$	19,282,931
Shares issued to shareholders in payment of distributions declared	34,943			351,151		62,280			622,650
Shares redeemed	(1,088,414	)		(10,956,346	)	(1,722,535	)		(17,202,260	)
Net change resulting from Investor Class Share transactions	228,843		$	2,309,384		270,097		$	2,703,321
SHORT-INTERMEDIATE BOND FUND—INVESTOR CLASS
Shares sold	1,643,487		$	15,182,142		11,620,253		$	107,213,243
Shares issued to shareholders in payment of distributions declared	280,114			2,582,477		1,940,714			17,899,033
Shares redeemed	(28,541,628	)		(263,722,724	)	(49,128,174	)		(449,907,732	)
Net change resulting from Investor Class Share transactions	(26,618,027	)	$	(245,958,105	)	(35,567,207	)	$	(324,795,456	)
SHORT-INTERMEDIATE BOND FUND—ADVISOR CLASS
Shares sold	21,635		$	199,366		87,438		$	805,866
Shares issued to shareholders in payment of distributions declared	13,137			121,102		28,077			258,648
Shares redeemed	(84,144	)		(774,700	)	(188,811	)		(1,739,230	)
Net change resulting from Advisor Class Share transactions	(49,372	)	$	(454,232	)	(73,296	)	$	(674,716	)
SHORT-INTERMEDIATE BOND FUND—INSTITUTIONAL CLASS(2)
Shares sold	22,662,265		$	209,588,612		20,117,372		$	183,469,859
Shares issued to shareholders in payment of distributions declared	486,517			4,484,680		160,978			1,472,694
Shares redeemed	(2,801,921	)		(25,814,754	)	(461,211	)		(4,210,928	)
Net change resulting from Institutional Class Share transactions	20,346,861		$	188,258,538		19,817,139		$	180,731,625
Net change resulting from Fund Share transactions	(6,320,538	)	$	(58,153,799	)	(15,823,364	)	$	(144,738,547	)
SHORT-TERM INCOME FUND—INVESTOR CLASS
Shares sold	1,309,253		$	11,951,805		1,422,934		$	12,833,031
Shares issued to shareholders in payment of distributions declared	62,264			567,729		256,493			2,315,244
Shares redeemed	(6,380,936	)		(58,477,090	)	(7,381,543	)		(66,583,589	)
Net change resulting from Investor Class Share transactions	(5,009,419	)	$	(45,957,556	)	(5,702,116	)	$	(51,435,314	)
SHORT-TERM INCOME FUND—ADVISOR CLASS
Shares sold	8,476		$	76,991		44,298		$	399,141
Shares issued to shareholders in payment of distributions declared	5,567			50,741		11,690			105,483
Shares redeemed	(61,607	)		(562,334	)	(72,074	)		(649,618	)
Net change resulting from Advisor Class Share transactions	(47,564	)	$	(434,602	)	(16,086	)	$	(144,994	)

70

Notes to Financial Statements (continued)

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
SHORT-TERM INCOME FUND—INSTITUTIONAL CLASS(2)
Shares sold	5,570,476		$	51,110,364		4,573,668		$	41,232,044
Shares issued to shareholders in payment of distributions declared	100,592			917,611		48,519			437,319
Shares redeemed	(883,001	)		(8,013,688	)	(55,556	)		(500,000	)
Net change resulting from Institutional Class Share transactions	4,788,067		$	44,014,287		4,566,631		$	41,169,363
Net change resulting from Fund Share transactions	(268,916	)	$	(2,377,871	)	(1,151,571	)	$	(10,410,945	)
PRIME MONEY MARKET FUND—INVESTOR CLASS
Shares sold	3,047,863,963		$	3,047,863,963		5,089,270,604		$	5,089,270,604
Shares issued to shareholders in payment of distributions declared	14,011,395			14,011,395		26,373,229			26,373,229
Shares redeemed	(2,778,143,925	)		(2,778,143,925	)	(4,815,464,848	)		(4,815,464,848	)
Net change resulting from Investor Class Share transactions	283,731,433		$	283,731,433		300,178,985		$	300,178,985
PRIME MONEY MARKET FUND—ADVISOR CLASS
Shares sold	100,346,340		$	100,360,491		174,486,007		$	174,486,007
Shares issued to shareholders in payment of distributions declared	2,706,541			2,706,541		4,848,956			4,848,956
Shares redeemed	(60,951,297	)		(60,965,448	)	(155,017,339	)		(155,017,339	)
Net change resulting from Advisor Class Share transactions	42,101,584		$	42,101,584		24,317,624		$	24,317,624
PRIME MONEY MARKET FUND—INSTITUTIONAL CLASS
Shares sold	4,746,672,414		$	4,746,672,414		10,274,819,329		$	10,274,819,329
Shares issued to shareholders in payment of distributions declared	14,570,491			14,570,491		26,908,729			26,908,729
Shares redeemed	(3,899,524,988	)		(3,899,524,988	)	(9,874,858,264	)		(9,874,858,264	)
Net change resulting from Institutional Class Share transactions	861,717,917		$	861,717,917		426,869,794		$	426,869,794
Net change resulting from Fund Share transactions	1,187,550,934		$	1,187,550,934		751,366,403		$	751,366,403
GOVERNMENT MONEY MARKET FUND—INVESTOR CLASS
Shares sold	1,275,026,778		$	1,275,026,778		2,004,342,787		$	2,004,342,787
Shares issued to shareholders in payment of distributions declared	3,181,097			3,181,097		6,381,859			6,381,859
Shares redeemed	(1,248,258,909	)		(1,248,258,909	)	(1,903,266,787	)		(1,903,266,787	)
Net change resulting from Investor Class Share transactions	29,948,966		$	29,948,966		107,457,859		$	107,457,859

71

Marshall Funds

	Period Ended February 29, 2008					Year Ended August 31, 2007
	Shares		Amount			Shares		Amount
GOVERNMENT MONEY MARKET FUND—INSTITUTIONAL CLASS
Shares sold	706,575,177		$	706,575,177		1,013,039,191		$	1,013,039,191
Shares issued to shareholders in payment of distributions declared	1,626,136			1,626,136		1,463,815			1,463,815
Shares redeemed	(538,014,401	)		(538,014,401	)	(943,208,907	)		(943,208,907	)
Net change resulting from Institutional Class Share transactions	170,186,912		$	170,186,912		71,294,099		$	71,294,099
Net change resulting from Fund Share transactions	200,135,878		$	200,135,878		178,751,958		$	178,751,958
TAX-FREE MONEY MARKET FUND—INVESTOR CLASS
Shares sold	374,222,038		$	374,222,038		687,542,333		$	687,542,333
Shares issued to shareholders in payment of distributions declared	1,409,316			1,409,316		2,677,134			2,677,134
Shares redeemed	(414,695,182	)		(414,695,182	)	(574,409,462	)		(574,409,462	)
Net change resulting from Investor Class Share transactions	(39,063,828	)	$	(39,063,828	)	115,810,005		$	115,810,005
TAX-FREE MONEY MARKET FUND—INSTITUTIONAL CLASS
Shares sold	465,683,728		$	465,683,728		511,618,164		$	511,618,164
Shares issued to shareholders in payment of distributions declared	6,229			6,229		77,277			77,277
Shares redeemed	(314,103,950	)		(314,103,950	)	(384,261,279	)		(384,261,279	)
Net change resulting from Institutional Class Share transactions	151,586,007		$	151,586,007		127,434,162		$	127,434,162
Net change resulting from Fund Share transactions	112,522,179		$	112,522,179		243,244,167		$	243,244,167

(1) Commenced operations on February 1, 2008.

(2) Commenced operations on June 1, 2007.

4. Federal Tax Information

The timing and character of income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP. These differences are due in part to differing treatments for net operating loss, foreign currency transactions, paydown gain or loss, market discount accretion, premium amortization and expiring capital loss carryforwards.

To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts, on the Statement of Assets and Liabilities, based on their Federal tax basis treatment; temporary differences do not require reclassification and had no effect on the net asset value of the Funds.

Effective February 29, 2008, the Funds adopted Financial Accounting Standards Board Interpretation No. 48 ‘‘Accounting for Uncertainty in Income Taxes’’ (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Funds’ tax returns to determine whether it is ‘‘more-likely-than-not,’’ (i.e., greater than 50 percent) of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold may result in a tax benefit or expense in the current year.

FIN 48 requires management of the Funds to analyze all open tax years, as defined by the statutes of limitations, for all major jurisdictions, which includes federal and certain states. Open tax years are those that are open for exam by taxing authorities (i.e., the last four tax year-ends and the interim tax period since then). The Funds have no examinations in progress.

For all open tax years and all major taxing jurisdictions through the end of the reporting period, management of the Funds reviewed all tax positions taken or expected to be taken in the preparation of the Funds’ tax returns and concluded the adoption of FIN 48 resulted in no effect on the Funds’ reported net assets or results of operations as of and during the period ended February 29, 2008.

Management of the Funds is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

72

Notes to Financial Statements (continued)

The difference between book basis and tax basis unrealized appreciation/depreciation is attributable in part to the tax deferral of losses on wash sales, the realization for tax purposes of unrealized gains on investments in passive foreign investment companies and the discount accretion/premium amortization of debt securities.

Fund	Cost of Investments for Federal Tax Purposes		Gross Unrealized Appreciation for Federal Tax Purposes		Gross Unrealized (Depreciation) for Federal Tax Purposes			Net Unrealized Appreciation (Depreciation) for Federal Tax Purposes
Large-Cap Value Fund	$	289,680,098	$	47,989,829	$	(11,582,698	)	$	36,407,131
Large-Cap Growth Fund		273,845,135		22,583,089		(14,689,997	)		7,893,092
Mid-Cap Value Fund		417,669,700		59,776,429		(32,963,666	)		26,812,763
Mid-Cap Growth Fund		280,240,544		32,875,076		(8,651,275	)		24,223,801
Small-Cap Growth Fund		386,689,277		34,225,261		(23,625,055	)		10,600,206
International Stock Fund		514,706,459		52,765,347		(32,359,591	)		20,405,756
Aggregate Bond Fund		359,426,487		6,078,545		(4,390,714	)		1,687,831
Government Income Fund		1,158,437,933		12,437,925		(10,204,794	)		2,233,131
Intermediate Tax-Free Fund		81,891,345		828,953		(1,532,650	)		(703,697	)
Short-Intermediate Bond Fund		626,349,262		5,674,914		(13,102,137	)		(7,427,223	)
Short-Term Income Fund		136,629,700		1,921,387		(2,325,848	)		(404,461	)
Prime Money Market Fund*		6,127,466,125		—		—			—
Government Money Market Fund*		546,428,737		—		—			—
Tax-Free Money Market Fund*		649,133,729		—		—			—

* at amortized cost

The tax character of distributions reported on the Statements of Changes in Net Assets for the years ended August 31, 2007 and 2006 was as follows:

	2007						2006
Fund	Ordinary Income(1)		Tax-Exempt Income		Long-Term Capital Gains		Ordinary Income(1)		Tax-Exempt Income		Long-Term Capital Gains
Large-Cap Value Fund	$	18,858,614	$	—	$	14,512,684	$	11,439,241	$	—	$	36,028,462
Large-Cap Growth Fund		345,013		—		7,550,618		11,361,141		—		21,622,536
Mid-Cap Value Fund		12,454,207		—		43,973,908		12,216,179		—		51,535,070
Mid-Cap Growth Fund		—		—		—		—		—		—
Small-Cap Growth Fund		4,818,455		—		11,372,971		5,769,643		—		7,710,290
International Stock Fund		3,530,293		—		47,774,480		3,259,900		—		—
Aggregate Bond Fund		2,198,919		—		—		—		—		—
Government Income Fund		28,521,867		—		—		23,703,562		—		—
Intermediate Tax-Free Fund		—		2,888,545		—		50,527		2,847,987		2,148,867
Short-Intermediate Bond Fund		31,170,098		—		—		29,092,735		—		—
Short-Term Income Fund		5,559,089		—		—		5,359,412		—		—
Prime Money Market Fund		240,796,645		—		—		171,950,178		—		—
Government Money Market Fund		13,620,708		—		—		8,059,533		—		—
Tax-Free Money Market Fund		13,636		14,927,950		23,860		3,920		7,458,975		8,211

(1) For tax purposes, short-term capital gain distributions are considered ordinary income.

As of August 31, 2007, the components of distributable earnings on a tax basis are as follows:

Fund	Undistributed Ordinary Income		Undistributed Tax-Exempt Income			Undistributed Long-Term Capital Gains		Accumulated Capital and Other Losses			Unrealized Appreciation (Depreciation)
Large-Cap Value Fund	$	3,851,310	$	—		$	8,842,130	$	—		$	62,718,593
Large-Cap Growth Fund		149,357		—			15,057,904		—			34,959,289
Mid-Cap Value Fund		18,653,382		—			46,715,239		—			78,612,637
Mid-Cap Growth Fund		—		—			—		(8,598,968	)		34,570,139
Small-Cap Growth Fund		10,837,769		—			25,320,534		—			36,788,054
International Stock Fund		32,220,764		—			32,783,821		(896,887	)		66,061,266
Aggregate Bond Fund		14,759		—			—		(165,071	)		2,082,049
Government Income Fund		439,581		—			—		(2,358,980	)		(1,765,029	)
Intermediate Tax-Free Fund		—		(525	)		—		(460,258	)		503,642
Short-Intermediate Bond Fund		293,149		—			—		(23,593,518	)		(5,108,649	)
Short-Term Income Fund		30,621		—			—		(7,771,827	)		(1,570,074	)
Prime Money Market Fund		9,176		—			—		(394,528	)		—
Government Money Market Fund		—		—			—		—			—
Tax-Free Money Market Fund		3,000		53			—		—			—

73

Marshall Funds

At August 31, 2007, the Funds had capital loss carryforwards, which reduce the Funds’ taxable income arising from future net realized gains on investments, if any, to the extent permitted by the Code, and thus will reduce the amount of distributions to shareholders which would otherwise be necessary to relieve the Funds of any liability for federal tax. Pursuant to the Code, such capital loss carryforward will expire as follows:

	Capital Loss Carryforward to Expire in
Fund	2008		2009		2010		2011		2012		2013		2014		2015		Total
Mid-Cap Growth Fund	$	—	$	—	$	—	$	8,598,968	$	—	$	—	$	—	$	—	$	8,598,968
Government Income Fund		—		—		—		—		—		—		218,824		—		218,824
Intermediate Tax-Free Fund		—		—		—		—		—		—		—		130,326		130,326
Short-Intermediate Bond Fund		1,553,692		—		6,283,428		3,131,248		—		—		5,042,619		4,819,127		20,830,114
Short-Term Income Fund		222,218		928,524		944,182		322,004		1,989,874		797,744		906,238		983,288		7,094,072
Prime Money Market Fund		—		—		—		394,528		—		—		—		—		394,528

During the fiscal year ended August 31, 2007, the Mid-Cap Growth, Government Income and Prime Money Market Funds, respectively, utilized $27,809,903, $1,670,878 and $7,764 of capital loss carryforwards.

The Short-Term Income Fund had losses expiring during the fiscal year ended August 31, 2007 in the amount of $952,637.

As of August 31, 2007, the Aggregate Bond, Government Income, Intermediate Tax-Free, Short-Intermediate Bond and Short-Term Income Funds had $165,071, $2,140,156, $329,819, $2,763,404 and $677,755, respectively, of post-October losses, which are deferred until September 1, 2007 for tax purposes. Net capital losses incurred after October 31, and within the taxable year are deemed to arise on the first day of the Fund’s next taxable year. As of August 31, 2007, the International Stock Fund had $896,887, of post-October currency losses, which were deferred until September 1, 2007 for tax purposes.

5. Investment Adviser Fee and Other Transactions with Affiliates

Investment Adviser Fee—M&I Investment Management Corp., the Funds’ investment adviser (the “Adviser”), receives for its services an investment adviser fee based on a percentage of each Fund’s average daily net assets as listed below. Effective November 1, 2007, the Adviser implemented a breakpoint schedule for its investment advisory fees charged to the Funds (excluding the Small-Cap Growth Fund and the Money Market Funds). The Adviser may voluntarily choose to waive any portion of its fee. The Adviser can modify or terminate this voluntary waiver at any time at its sole discretion.

Fund	(September 1, 2007- October 31, 2007) Annual Rate		(November 1, 2007-February 29, 2008) Fund’s ADNA
			on the first $500 million		on the next $200 million		on the next $100 million		in excess of $800 million
Large-Cap Value Fund	0.75	%	0.75	%	0.74	%	0.70	%	0.65	%
Large-Cap Growth Fund	0.75		0.75		0.74		0.70		0.65
Mid-Cap Value Fund	0.75		0.75		0.74		0.70		0.65
Mid-Cap Growth Fund	0.75		0.75		0.74		0.70		0.65
Small-Cap Growth Fund	1.00		1.00		1.00		1.00		1.00
International Stock Fund	1.00		1.00		0.99		0.95		0.90
Aggregate Bond Fund	0.40		0.40		0.39		0.30		0.25
Government Income Fund	0.40		0.40		0.39		0.30		0.25
Intermediate Tax-Free Fund	0.60		0.60		0.59		0.50		0.45
Short-Intermediate Bond Fund	0.40		0.40		0.39		0.30		0.25
Short-Term Income Fund	0.20		0.20		0.19		0.10		0.10
Prime Money Market Fund	0.15		0.15		0.15		0.15		0.15
Government Money Market Fund	0.20		0.20		0.20		0.20		0.20
Tax-Free Money Market Fund	0.20		0.20		0.20		0.20		0.20

The International Stock Fund’s sub-advisers are Trilogy Global Advisors, LLC and Acadian Asset Management, LLC. The Adviser compensates each sub-adviser based on the level of average daily net assets of the International Stock Fund managed by each sub-adviser.

Administrative Fee—M&I Trust, under the Administrative Services Agreement, provides the Funds with administrative personnel and services. Effective November 1, 2007, M&I Trust modified its breakpoint schedule for administrative fees charged to the Funds (excluding the Money Market Funds).

74

Notes to Financial Statements (continued)

Equity & Income Funds
(September 1, 2007-October 31, 2007)		(November 1, 2007-February 29, 2008)
Annual Rate	ADNA	Annual Rate	ADNA
0.0925%	on the first $250 million	0.0925%	on the first $250 million
0.0850	on the next $250 million	0.0850	on the next $250 million
0.0800	on the next $250 million	0.0800	on the next $200 million
0.0700	on the next $250 million	0.0400	on the next $100 million
0.0600	on the next $500 million	0.0200	on the next $200 million
0.0400	in excess of $1.5 billion	0.0100	in excess of $1.0 billion

Money Market Funds
(September 1, 2007-February 29, 2008)
Annual Rate	ADNA
0.1000%	on the first $250 million
0.0950	on the next $250 million
0.0800	on the next $250 million
0.0600	on the next $250 million
0.0400	on the next $500 million
0.0200	in excess of $1.5 billion

The fee paid to M&I Trust is based on each Fund’s average daily net assets with respect to the Equity Funds and Income Funds and the aggregate average daily net assets of all Money Market Funds. M&I Trust may voluntarily choose to waive any portion of its fee. M&I Trust can modify or terminate this voluntary waiver at any time at its sole discretion.

Distribution Services Fee—The Prime Money Market Fund is subject to a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 under the Act. The Plan authorizes payments by the Fund to finance activities intended to result in the sale of its Advisor Class shares. The Plan provides that the Fund may incur distribution expenses of 0.30% of the average daily net assets of the Fund’s Advisor Class shares.

Shareholder Services Fee—Under the terms of a Shareholder Services Agreement with Marshall Investor Services (“MIS”), a division of M&I Trust, each Fund pays MIS at the annual rate of 0.25% of average daily net assets of the Fund’s Investor and Advisor Class shares for the period. The fee paid to MIS is used to finance certain services for shareholders and to maintain shareholder accounts. MIS may voluntarily choose to waive any portion of its fee. MIS can modify or terminate this voluntary waiver at any time at its sole discretion.

Custodian Fees—M&I Trust is the Funds’ custodian, except for the International Stock Fund for which State Street Bank and Trust Company maintains custody. M&I Trust receives fees based on the level of each Fund’s average daily net assets for the period.

Securities Lending—The Funds pay a portion of net revenue from securities lending to M&I Trust for its services as the securities lending agent. The securities lending income as shown in the Statements of Operations is net of these expenses. The following amounts were paid for the period ended February 29, 2008:

Fund	Fees Paid
Large-Cap Value Fund	$	20,681
Large-Cap Growth Fund		19,522
Mid-Cap Value Fund		49,045
Mid-Cap Growth Fund		63,815
Small-Cap Growth Fund		170,830
International Stock Fund		41,985
Aggregate Bond Fund		60,363
Government Income Fund		169,021
Short-Intermediate Bond Fund		73,608
Short-Term Income Fund		15,311

General—Certain of the Officers and Directors of the Corporation are also Officers and Directors of one or more of the above companies, which are affiliates of the Corporation. None of the Fund officers or interested directors receive any compensation from the Funds.

75

Marshall Funds

6. Investment Transactions

Purchases and sales of investments, excluding short-term U.S. government securities, short-term obligations and in-kind contributions, for the period ended February 29, 2008 were as follows:

	Other than U.S. Government Securities				U.S. Government Securities
Fund	Purchases		Sales		Purchases		Sales
Large-Cap Value Fund	$	76,041,530	$	96,224,131	$	—	$	—
Large-Cap Growth Fund		182,116,079		182,955,053		—		—
Mid-Cap Value Fund		95,452,108		238,970,620		—		—
Mid-Cap Growth Fund		224,743,692		205,407,741		—		—
Small-Cap Growth Fund		276,018,726		249,167,348		—		—
International Stock Fund		190,060,999		224,732,345		—		—
Aggregate Bond Fund		138,051,314		77,738,463		184,091,225		212,325,917
Government Income Fund		84,826,281		84,647,756		915,797,541		992,292,859
Intermediate Tax-Free Fund		77,617,079		78,698,896		—		—
Short-Intermediate Bond Fund		191,336,934		194,344,880		433,029,218		540,229,901
Short-Term Income Fund		12,762,256		17,344,010		11,774,279		16,340,303

7. Line of Credit

The Corporation, on behalf of the respective Funds, entered into a $25,000,000 unsecured, committed revolving line of credit (“LOC”) agreement with State Street Bank and Trust Company. The LOC was made available for extraordinary or emergency purposes, primarily for financing redemption payments. Borrowings are charged interest at a rate of 0.50% per annum over the Federal Funds rate. The LOC includes a commitment fee of 0.09% per annum on the daily unused portion. The Mid-Cap Value Fund, Government Money Market Fund, and Tax-Free Money Market Fund utilized the LOC during the period ended February 29, 2008. No borrowings were outstanding under the LOC at February 29, 2008. For the period ended February 29, 2008, the average daily loan balances outstanding were $7,088, $4,396, and $165,126, and the weighted average interest rates were 5.0625%, 5.0000%, and 5.0176%, respectively.

8. Recently Issued Accounting Pronouncements

In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements.” The Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. The Statement establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs), and (2) the reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The Statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and is to be applied prospectively as of the beginning of the fiscal year in which this Statement is initially applied. Management continues to evaluate the application of the Statement to the Funds, and is not in a position at this time to evaluate the significance of its impact, if any, on the Funds’ financial statements.

In addition, in February 2007, the FASB issued Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“FAS 159”), which is also effective for fiscal years beginning after November 15, 2007. Early adoption is permitted as of the beginning of the fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provisions of FAS 157. FAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. FAS 159 also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. Management has recently begun to evaluate the application of the Statement to the Funds, and is not in a position at this time to evaluate the significance of its impact, if any, on the Funds’ financial statements.

76

This report is authorized for distribution to prospective investors only when preceded or accompanied by the Funds’ prospectuses, which contain facts concerning each Fund’s objective and policies, management fees, expenses, and other information.

Proxy Voting

A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling toll free, 1-800-236-FUND (3863) and by accessing the Funds’ Statement of Additional Information, which is available on the Funds’ website at http://www.marshallfunds.com and on the SEC’s website at http://www.sec.gov.

Each Fund’s proxy voting record for the most recent 12-month period ended June 30 is available without charge, upon request, by calling toll free, 1-800-236-FUND (3863) and by accessing the SEC’s website at http://www.sec.gov.

Disclosure of Portfolio Holdings

The Funds file their complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Each Fund’s Form N-Q is available on the SEC’s website at http://www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

Shares of the Marshall Funds are not bank deposits or other obligations of, or issued, endorsed or guaranteed by, M&I Marshall & Ilsley Bank or any of its affiliates. Shares of the Marshall Funds, like shares of all mutual funds, are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency. Investment in mutual funds involves investment risk, including the possible loss of principal.

77

Item 2. Code of Ethics

Not applicable to semi-annual reports.

Item 3. Audit Committee Financial Expert

Not applicable to semi-annual reports.

Item 4. Principal Accountant Fees and Services

Not applicable to semi-annual reports.

Item 5. Audit Committee of Listed Registrants

Not applicable.

Item 6. Schedule of Investments

Included as part of the report to shareholders filed under Item 1 of this Form N-CSR.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies

Not applicable to open-end investment companies.

Item 8. Portfolio Managers of Closed-End Management Investment Companies

Not applicable to open-end investment companies.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

Not applicable to open-end investment companies.

Item 10. Submission of Matters to a Vote of Security Holders

Not applicable.

Item 11. Controls and Procedures

a) The Registrant’s principal executive officer and principal financial officer have reviewed the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “Act”)) as of a date within 90 days of the filing of this report and have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized, reported and made known to them by others within the Registrant and by the Registrant’s service providers.

b) There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that materially affected, or were reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

Item 12. Exhibits

(a) (1)	Not applicable to semi-annual reports.
(a) (2)	Certifications required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
(a) (3)	Not applicable to open end investment companies.
(b)	Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith.

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.

Marshall Funds, Inc.
/s/ John M. Blaser
By:	John M. Blaser
	President
	April 18, 2008

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.

/s/ John M. Blaser
By:	John M. Blaser
	President
	(Principal Executive Officer)
	April 18, 2008
/s/ Timothy M. Bonin
By:	Timothy M. Bonin
	Treasurer
	(Principal Financial Officer)
	April 18, 2008