X0101 EFFECT 33 LIVE 2010-03-18 14:30:00

N-14

0000898745 PRINCIPAL FUNDS INC 333-164920 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000082026 Institutional Class 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019073 Institutional Class 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000082027 Class R-1 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019072 R-1 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000082028 Class R-2 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019074 R-2 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000082029 Class R-3 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019075 R-3 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000082030 Class R-4 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019077 R-4 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000082031 Class R-5 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019076 R-5 0000898745 PRINCIPAL FUNDS INC S000027178 Bond Market Index Fund C000085837 Class J Shares 0000898745 PRINCIPAL FUNDS INC S000006995 High Quality Intermediate-Term Bond Fund C000019078 Class J