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Investment Type: pifretail

California Municipal Fund (A) (SRCMX)

Quick Facts Ticker: SRCMX Inception Date: 07/25/1989 Morningstar Category: Muni California Long Total Net Assets (mil): $288.72	Investment Strategy    What's this? The investment seeks to provide as high a level of current income that is exempt from federal and California state personal income tax as is consistent with prudent investment management and preservation of capital. The fund normally invests at least 80% of assets in intermediate- and long-term California municipal obligations (municipal obligations that generate interest which is exempt from California State personal income tax). It may invest up to 20% of assets in municipal obligations that are not exempt from California personal income tax and short-term municipal obligations. The fund is nondiversified.
Morningstar Style Box™   as of 07/31/2010 What's this?	Overall Morningstar Star Rating™   as of 08/31/2010 What's this? Out of 142 Muni California Long Funds Morningstar's Star Ratings reflect risk adjusted performance and are derived from a weighted average of the performance figures associated with its three, five, and ten-year (if applicable) time periods.

Total Returns

Investment results shown represent historical performance and do not guarantee future results. Investment returns and principal values fluctuate with changes in interest rates and other market conditions so the value, when redeemed, may be worth more or less than original costs. Current performance may be lower or higher than the performance data shown. Where gross and net expense ratios differ, Principal Management Corporation has contractually agreed to limit the investment option's expenses. Differences also may be due to Principal Management Corporation's decision to pay (through the same dates) certain expenses that would normally be payable by the fund. Returns displayed are based on net total investment expense.

Month-End | Quarter-End

Average Annual Total Returns as of 08/31/2010

1 Month 3 Month YTD 1 Year 3 Year 5 Year 10 Year Since      Inception* Excluding Sales Charge % 2.84 3.67 7.84 13.28 2.95 2.32 4.02 5.42 Including Sales Charge % -1.01 -0.21 3.84 9.05 1.66 1.53 3.63 5.23 Barclays Capital Municipal Bond Index % 2.29 3.63 7.00 9.78 6.62 5.02 5.69 --- Muni California Long Category % 2.81 3.79 7.99 12.07 4.50 3.51 4.56 --- Morningstar Percentile Ranking** --- --- --- 16 88 91 82 --- # of Funds in Category 153 153 151 151 142 131 115 ---

* Inception Date: 07/25/1989

**Morningstar percentile rankings are based on total returns.

Expenses

  as of 08/31/2010

Total Investment Expense - Gross:	0.91%
Total Investment Expense - Net:	0.91%
Maximum Up-front Sales Charge:	3.75%
12b-1 Fee:	0.25%

Growth of $10,000

   What's this?

Represents performance for Class A shares adjusted for the maximum sales charge and assumes the reinvestment of distributions. Performance assumes reinvestment of all dividends and capital gains. Extended performance is calculated based on the historical performance of the investment option's oldest share class, adjusted for the fees and expenses of the share class shown. Periods of less than one year are not annualized.

Investment Subadvisors

   What's this?

Invesco

Portfolio Managers

   What's this?

Robert J. Stryker , CFA Since 05/21/2008 B.S. , University of Illinois, Chicago

Robert W. Wimmel Since 12/08/2009 M.A. , University of Illinois, Chicago

Thomas M. Byron Since 12/31/2009 M.B.A. , DePaul University

© 2010 Morningstar, Inc. All Rights Reserved. Part of the mutual fund data contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. The full name of this investment option is Principal California Municipal Fund (A). Before investing in mutual funds, investors should carefully consider the investment objectives, risks, charges and expenses of the funds. This and other information is contained in the free prospectus, which can be downloaded from our site, or by contacting us at 1.800.222.5852. Please read the prospectus carefully before investing. Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc., member of the Principal Financial Group®. Principal Funds Distributor, Principal Shareholder Services, Principal Management Corporation and its affiliates, and Principal Funds, Inc. are collectively referred to as Principal Funds. Not FDIC Insured May Lose Value - Not a Deposit - No Bank Guarantee Not Insured by any Federal Government Agency

Barclays Capital Municipal Bond Index represents the long-term, investment-grade tax-exempt bond market. Fixed-income investment options are subject to interest rate risk, and their value will decline as interest rates rise. A portion of the Fund's income may be subject to state and/or local taxes, and it may be subject to federal alternative minimum tax (AMT) for certain investors. Effective June 15, 2010, references to Van Kampen Asset Management as investment advisor was replaced with Invesco Advisors, Inc. This is a name change only and does not affect the management, objective, or strategy of this investment option.