# EDGAR Filing Document

**Accession Number:** 0000916620
**File Stem:** 0001193125-23-055829
**Filing Date:** 2023-3
**Character Count:** 24021
**Document Hash:** 35fbc0a04d4dcf185e2cafcb3e389723
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-23-055829.hdr.sgml**: 20230301

**ACCESSION NUMBER**: 0001193125-23-055829

**CONFORMED SUBMISSION TYPE**: 497K

**PUBLIC DOCUMENT COUNT**: 3

**FILED AS OF DATE**: 20230301

**DATE AS OF CHANGE**: 20230301

**EFFECTIVENESS DATE**: 20230301

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** NORTHERN FUNDS
- **CENTRAL INDEX KEY:** 0000916620
- **IRS NUMBER:** 391777365
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0331

**FILING VALUES:**
- **FORM TYPE:** 497K
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 033-73404
- **FILM NUMBER:** 23692280

**BUSINESS ADDRESS:**
- **STREET 1:** NORTHERN FUNDS
- **STREET 2:** 50 SOUTH LASALLE STREET
- **CITY:** CHICAGO
- **STATE:** IL
- **ZIP:** 60603
- **BUSINESS PHONE:** 800-595-9111

**MAIL ADDRESS:**
- **STREET 1:** NORTHERN FUNDS
- **STREET 2:** 50 SOUTH LASALLE STREET
- **CITY:** CHICAGO
- **STATE:** IL
- **ZIP:** 60603

## Series and Classes Contracts Data

### NORTHERN U.S.TREASURY INDEX FUND (Series ID: S000038897)

| Class ID   | Class Name                        | Ticker Symbol   |
|:---|:---|:---|
| C000119675 | NORTHERN U.S. TREASURY INDEX FUND | BTIAX           |

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| **NORTHERN FUNDS**<br> **U.S. Treasury Index Fund** | ![LOGO](g473355g36t24.jpg) |

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| **Summary Prospectus** \| **July 29, 2022, as Amended March 1, 2023** | **Shares Class:** BTIAX |

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&nbsp;&nbsp;&nbsp;Before you invest, you may want to review the Fund's complete Prospectus, which contains more information about the Fund and its risks. You can find the Fund's complete Prospectus, reports to shareholders, and other information about the Fund online at northerntrust.com/prospectus. You can also get this information at no cost by calling 800-595-9111 or by sending an e-mail request to northern-funds@ntrs.com. If you purchase shares of the Fund through a financial intermediary (such as a bank or a broker-dealer), the complete Prospectus and other information are also available from your financial intermediary. The Fund's complete Prospectus and Statement of Additional Information, both dated July 29, 2022, as supplemented, are incorporated by reference into this summary prospectus and may be obtained, free of charge, at the website, phone number or e-mail address noted above.

**INVESTMENT OBJECTIVE** 

The Fund seeks to provide investment results approximating the performance of the Bloomberg U.S. Treasury Index (the "Index").

**FEES AND EXPENSES OF THE FUND** 

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund. You may be required to pay commissions and/or other forms of compensation to a financial intermediary for transactions in Shares Class shares, which are not reflected in the tables or the examples below.

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| | |
|:---|:---|
| **Shareholder Fees** (fees paid directly from your investment) | **Shareholder Fees** (fees paid directly from your investment) |
| **Annual Fund Operating Expenses** (expenses that you pay each year as a<br>percentage of the value of your investment) | **Annual Fund Operating Expenses** (expenses that you pay each year as a<br>percentage of the value of your investment) |
|  | **Shares<br>Class** |
|  Management Fees | 0.13% |
|  Other Expenses | 0.14% |
| &nbsp;&nbsp;&nbsp;&nbsp; Transfer Agent Fees | 0.04% |
| &nbsp;&nbsp;&nbsp;&nbsp; Other Operating Expenses | 0.10% |
|  **Total Annual Fund Operating Expenses** | 0.27% |
|  Expense Reimbursement<sup>(1)</sup> | (0.11)% |
|  **Total Annual Fund Operating Expenses After Expense Reimbursement<sup>(1)</sup>** | 0.16% |

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*<sup>(1)</sup>* *Northern Trust Investments, Inc. ("NTI") has contractually agreed to reimburse a portion of the operating expenses of the Fund so that after such reimbursement the Total Annual Fund Operating Expenses of the Fund (excluding (i) acquired fund fees and expenses; (ii) the compensation paid to each Independent Trustee of the Trust; (iii) expenses of third party consultants engaged by the Board of Trustees; (iv) membership dues paid to the Investment Company Institute and Mutual Fund Directors Forum; (v) expenses in connection with the negotiation and renewal of the revolving credit facility; and (vi) extraordinary expenses and interest) do not to the extent the "Total Annual Fund Operating Expenses" exceed 0.15%. This contractual limitation may not be terminated before July 31, 2023 without the approval of the Board of Trustees.* 

**EXAMPLE** 

The following Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same (taking into account the expense reimbursement arrangement for one year). Although your actual costs may be higher or lower, based on these assumptions your costs would be:

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|:---|:---|:---|:---|:---|
|  | **1 Year** | **3 Years** | **5 Years** | **10 Years** |
|  **Shares Class** | $16 | $76 | $141 | $332 |

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**PORTFOLIO TURNOVER.** The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual portfolio operating expenses or in the Example, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 32.19% of the average value of its portfolio.

**PRINCIPAL INVESTMENT STRATEGIES** 

Under normal circumstances, the Fund will invest substantially all (and at least 80%) of its net assets in a representative sample of the U.S. Treasury obligations included in the Index. The Fund will buy and sell securities with the goal of achieving an overall duration and total return similar to that of the Index.

The Index is an unmanaged index that includes a broad range of U.S. Treasury obligations and is regarded as representative of U.S. Treasury bond performance overall. As of May 31, 2022, the duration of the Index was approximately 6.35 years. It is rebalanced monthly. The Fund generally rebalances its portfolio in accordance with the Index.

NTI uses a "passive" or indexing approach to try to achieve the Fund's investment objective. Unlike many investment companies, the Fund does not try to "beat" the index it tracks and does not seek temporary defensive positions when markets decline or appear overvalued. NTI will buy and sell securities in response to changes in the Index as well as in response to subscriptions and redemptions.

NTI uses a representative sampling strategy to manage the Fund. "Representative sampling" is investing in a representative sample of securities that collectively has an investment profile similar to that of an index. The Fund may or may not hold all of the securities that are included in the Index. The Fund reserves the right to invest in all of the securities in the Index in approximately the same proportion (i.e., replication) if NTI determines that it is in the best interest of the Fund.

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|:---|:---|:---|
| NF SUM USTR REVISED (3/23) | SUMMARY PROSPECTUS<sub>1</sub> | U.S. TREASURY INDEX FUND |

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The Fund intends to be diversified in approximately the same proportion as the Index is diversified. The Fund may become "non-diversified," as defined in the Investment Company Act of 1940 (the "1940 Act"), solely as a result of a change in relative market capitalization or index weighting of one or more constituents of the Index. A "non-diversified" fund can invest a greater percentage of its assets in a small group of issuers or in any one issuer than a diversified fund can. Shareholder approval will not be sought if the Fund becomes non-diversified due solely to a change in the relative market capitalization or index weighting of one or more constituents of the Index.

NTI expects that, under normal circumstances, the quarterly performance of the Fund, before fees and expenses, will track the performance of the Index within a 0.95 correlation coefficient.

*The Index is created and sponsored by Bloomberg Index Services Limited ("Bloomberg"), as the index provider. Bloomberg determines the composition and relative weightings of the securities in the Index and publishes information regarding the market value of the Index. Bloomberg does not endorse any of the securities in the Index. It is not a sponsor of the U.S. Treasury Index Fund and is not affiliated with the Fund in any way.* 

**PRINCIPAL RISKS** 

As with any investment, you could lose all or part of your investment in the Fund, and the Fund's performance could trail that of other investments. The Fund is subject to certain risks, including the principal risks noted below, any of which may adversely affect the Fund's net asset value ("NAV"), yield, total return and ability to meet its investment objective. Each risk noted below is considered a principal risk of investing in the Fund, regardless of the order in which it appears. The significance of each risk factor below may change over time and you should review each risk factor carefully.

**MARKET RISK** is the risk that the value of the Fund's investments may increase or decrease in response to expected, real or perceived economic, political or financial events in the U.S. or global markets. The frequency and magnitude of such changes in value cannot be predicted. Certain securities and other investments held by the Fund may experience increased volatility, illiquidity, or other potentially adverse effects in response to changing market conditions, inflation, changes in interest rates, lack of liquidity in the bond or equity markets, volatility in the equity markets, market disruptions caused by local or regional events such as war, acts of terrorism, the spread of infectious illness (including epidemics and pandemics) or other public health issues, recessions or other events or adverse investor sentiment or other political, regulatory, economic and social developments, and developments that impact specific economic sectors, industries or segments of the market. These risks may be magnified if certain events or developments adversely interrupt the global supply chain; in these and other circumstances, such risks might affect companies worldwide due to increasingly interconnected global economies and financial markets.

**TRACKING RISK** is the risk that the Fund's performance may vary from the performance of the index it tracks as a result of share purchases and redemptions, transaction costs, expenses and other factors.

**INTEREST RATE RISK** is the risk that during periods of rising interest rates, the Fund's yield (and the market value of its securities) will tend to be lower than prevailing market rates; in periods of falling interest rates, the Fund's yield (and the market value of its securities) will tend to be higher. In general, securities with longer maturities or durations are more sensitive to interest rate changes. Risks associated with rising interest rates are heightened given that interest rates in the U.S. are currently at low levels. Changing interest rates, including rates that fall below zero, may have unpredictable effects on the markets and the Fund's investments, may result in heightened market volatility, may impact the liquidity of fixed-income securities and of the Fund, and may detract from Fund performance. A low or negative interest rate environment could cause the Fund's earnings to fall below the Fund's expense ratio, resulting in a low or negative yield and a decline in the Fund's NAV. A general rise in interest rates may cause investors to move out of fixed income securities on a large scale, which could adversely affect the price and liquidity of fixed income securities and could also result in increased redemptions for the Fund.

**INDEX RISK** is the risk that that the Fund would not necessarily buy or sell a security unless that security is added or removed, respectively, from the Index, even if that security generally is underperforming, because unlike many investment companies, the Fund does not utilize an investing strategy that seeks returns in excess of the Index. Additionally, the Fund rebalances its portfolio in accordance with the Index, and, therefore, any changes to the Index's rebalance schedule will result in corresponding changes to the Fund's rebalance schedule.

**SAMPLING RISK** is the risk that the Fund's use of a representative sampling approach may result in increased tracking error because the securities selected for the Fund in the aggregate may vary from the investment profile of the Index. Additionally, the use of a representative sampling approach may result in the Fund holding a smaller number of securities than the Index, and, as a result, an adverse development to an issuer of securities that the Fund holds could result in a greater decline in NAV than would be the case if the Fund held all of the securities in the Index.

**DEBT EXTENSION RISK** is the risk that when interest rates rise an issuer will exercise its right to pay principal on certain debt securities held by the Fund later than expected. This will cause the value of the security, and the Fund's NAV, to decrease, and the Fund may lose opportunities to invest in higher yielding securities.

**PREPAYMENT (OR CALL) RISK** is the risk that an issuer could exercise its right to pay principal on callable debt securities held by the Fund earlier than expected. Issuers may be more likely to prepay when interest rates fall, when credit spreads change, or when an issuer's credit quality improves. If this happens, the Fund will not benefit from the rise in the market price of the securities that normally accompanies a decline in interest rates, and will be forced to reinvest prepayment proceeds in lower yielding securities, which may reduce the Fund's returns. The Fund may also lose any premium it paid to purchase the securities.

**NON-DIVERSIFICATION RISK** Under the 1940 Act, a fund designated as "diversified" must limit its holdings such that the

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|:---|:---|
| U.S. TREASURY INDEX FUND<sub>2</sub> | SUMMARY PROSPECTUS |

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securities of issuers which individually represent more than 5% of its total assets must in the aggregate represent less than 25% of its total assets. The Fund is "diversified" for purposes of the 1940 Act. However, in seeking to track its Index, the Fund may become "non-diversified," as defined in the 1940 Act, solely as a result of a change in relative market capitalization or index weighting of one or more constituents of the Index. A non-diversified fund can invest a greater portion of its assets in the obligations or securities of a small portion of its assets in the obligations or securities of a small number of issuers or any single issuer than a diversified fund can. In such circumstances, a change in the value of one or a few issuers' securities will therefore affect the value of the Fund more than if it was a diversified fund.

**As with any mutual fund, it is possible to lose money on an investment in the Fund. An investment in the Fund is not a deposit of any bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation, any other government agency, or The Northern Trust Company, its affiliates, subsidiaries or any other bank.** 

**FUND PERFORMANCE** 

The bar chart and table that follow provide an indication of the risks of investing in the Fund by showing (A) changes in the performance of the Fund from year to year, and (B) how the average annual total returns of the Fund compares to those of a broad-based securities market index.

The Fund has adopted the performance and accounting history of a separate portfolio of Northern Institutional Funds (the "Predecessor Fund") as the result of a reorganization of the Predecessor Fund into the Fund, which was consummated on November 16, 2012 (the "Reorganization"). Prior to the Reorganization, the Predecessor Fund offered and sold Class A shares. In connection with the Reorganization, holders of the Predecessor Fund's Class A shares received Shares Class shares of the Fund. The Predecessor Fund was managed with the same investment objective, strategies and policies as are followed by the Fund.

The performance information set forth in the bar chart and table below for periods prior to the Reorganization is that of the Class A shares of the Predecessor Fund. Returns of the Shares Class shares of the Fund will be different from the returns of Class A Shares of the Predecessor Fund as they have different expenses.

The Fund's past performance, before and after taxes, is not necessarily an indication of how the Fund will perform in the future.

Updated performance information for the Fund is available and may be obtained on the Fund's website at northerntrust.com/funds or by calling 800-595-9111.

**CALENDAR YEAR TOTAL RETURN\***![LOGO](g473355g62z81.jpg)

*\* Year to date total return for the six months ended June 30, 2022 was (9.21)%. For the periods shown in the bar chart above, the highest quarterly return was 8.40% in the first quarter of 2020, and the lowest quarterly return was (4.37)% in the first quarter of 2021.* 

**AVERAGE ANNUAL TOTAL RETURN** 

*(For the periods ended December 31, 2021)* 

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| | | | |
|:---|:---|:---|:---|
|  | **1-Year** | **5-Year** | **10-Year** |
| &nbsp;&nbsp; Shares Class |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Returns before taxes | (2.42)% | 2.90% | 1.95% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Returns after taxes on distributions | (3.16)% | 2.13% | 1.15% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Returns after taxes on distributions and sale of Fund shares | (1.29)% | 1.91% | 1.21% |
| &nbsp;&nbsp; Bloomberg U.S. Treasury Index (reflects no deduction for fees, expenses, or taxes) | (2.32)% | 3.07% | 2.13% |

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*After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor's tax situation and may differ from those shown. After-tax returns shown are not relevant to investors who hold their shares through tax-advantaged arrangements, such as 401(k) plans or individual retirement accounts.* 

*In calculating the federal income taxes due on redemptions, capital gains taxes resulting from redemptions are subtracted from the redemption proceeds and the tax benefits from capital losses resulting from the redemptions are added to the redemption proceeds. Under certain circumstances, the addition of the tax benefits from capital losses resulting from redemptions may cause the Returns after taxes on distributions and sale of Fund shares to be greater than the Returns after taxes on distributions or even the Returns before taxes.* 

**MANAGEMENT** 

**INVESTMENT ADVISER AND PORTFOLIO MANAGER.** NTI, an indirect subsidiary of Northern Trust Corporation, serves as the investment adviser of the U.S. Treasury Index Fund. Michael R. Chico, Vice President of NTI, has been manager of the Fund since July 2013. The Northern Trust Company, an affiliate of NTI, serves as transfer agent, custodian and sub-administrator to the Fund.

**PURCHASE AND SALE OF FUND SHARES** 

You may purchase Shares Class shares of the Fund by opening an account directly with Northern Funds (the "Trust") with a minimum initial investment of $2,500 in the Fund ($500 for an IRA; $250 under the Automatic Investment Plan; and $500 for

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| SUMMARY PROSPECTUS<sub>3</sub> | U.S. TREASURY INDEX FUND |

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employees of Northern Trust and its affiliates). The minimum subsequent investment is $50 (except for reinvestments of distributions for which there is no minimum). The Fund reserves the right to waive these minimums. You may also purchase Shares Class shares of the Fund through an account at Northern Trust (or an affiliate) or an authorized intermediary.

If you purchase, sell (redeem) or exchange Shares Class shares through an authorized intermediary, you may be required to pay a commission and/or other forms of compensation to the intermediary. In addition, an authorized intermediary may impose different investment minimums than those set forth above. The Fund is not responsible for any investment minimums imposed by authorized intermediaries or for notifying shareholders of any changes to them.

On any business day, you may sell (redeem) or exchange shares through your account by contacting your Northern Trust account representative or authorized intermediary. If you purchase shares directly from the Trust, you may sell (redeem) or exchange your shares in one of the following ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ By Mail – Send a written request to: Northern Funds, P.O. Box 75986, Chicago, Illinois 60675-5986.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ By Telephone – Authorize the telephone privilege on your New Account Application. Call 800-595-9111 to use the telephone privilege.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ By Wire – Authorize wire redemptions on your New Account Application and have proceeds sent by federal wire
transfer to a previously designated bank account (the minimum redemption amount by this method is $250). You will be charged $15 for each wire redemption unless the designated bank account is maintained at Northern Trust or an affiliated bank. Call 800-595-9111 for instructions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ By Systematic Withdrawal – If you own shares of the Fund with a minimum value of $10,000, you may elect to
have a fixed sum redeemed at regular intervals and distributed in cash or reinvested in one or more other funds of the Trust. Call 800-595-9111 for an application form
and additional information. The minimum amount is $250 per withdrawal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ By Exchange – Complete the Exchange Privilege section of your New Account Application to exchange shares of
one fund in the Trust for shares of another fund in the Trust. Shares being exchanged must have a value of at least $1,000 ($2,500 if a new account is being established by the exchange, $500 if the new account is an IRA). Call 800-595-9111 for more information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;∎ By Internet – You may initiate transactions between Northern Trust banking and Fund accounts by using
Northern Trust Private Passport. For details and to sign up for this service, go to northerntrust.com/funds or contact your Relationship Manager.

**TAX INFORMATION** 

The Fund's distributions are generally taxable to you as ordinary income, capital gains, or a combination of the two, unless you are investing through a tax-exempt or tax-advantaged arrangement, such as a 401(k) plan or an individual retirement account. Distributions may be taxable upon withdrawal from tax-advantaged accounts.

**PAYMENTS TO BROKERS-DEALERS AND OTHER FINANCIAL INTERMEDIARIES** 

If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

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| U.S. TREASURY INDEX FUND<sub>4</sub> | SUMMARY PROSPECTUS |

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