Edgar Filing: TEMPLETON EMERGING MARKETS FUND

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 811-04985
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TEMPLETON EMERGING MARKETS FUND
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(Exact name of registrant as specified in charter)

500 EAST BROWARD BLVD., FORT LAUDERDALE, FL 33394-3091
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(Address of principal executive offices) (Zip code)

CRAIG S. TYLE, ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
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(Name and address of agent for service)

Registrant's telephone number, including area code: (954) 527-7500
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Date of fiscal year end: 8/31
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Date of reporting period: 8/31/05
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ITEM 1. REPORTS TO STOCKHOLDERS

[GRAPHIC OMITTED]

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| AUGUST 31, 2005
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ANNUAL REPORT | INTERNATIONAL
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TEMPLETON
EMERGING MARKETS FUND

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[LOGO](R)
FRANKLIN(R)TEMPLETON(R)
INVESTMENTS

Franklin o TEMPLETON o Mutual Series

FRANKLIN TEMPLETON INVESTMENTS

GAIN FROM OUR PERSPECTIVE(R)

Franklin Templeton's distinct multi-manager
structure combines the specialized expertise
of three world-class investment management
groups-- Franklin, Templeton and Mutual
Series.

SPECIALIZED EXPERTISE Each of our portfolio management groups
operates autonomously, relying on its own
research and staying true to the unique
investment disciplines that underlie its
success.

FRANKLIN. Founded in 1947, Franklin is a
recognized leader in fixed income investing
and also brings expertise in growth- and
value-style U.S. equity investing.

TEMPLETON. Founded in 1940, Templeton
pioneered international investing and, in
1954, launched what has become the industry's
oldest global fund. Today, with offices in
over 25 countries, Templeton offers investors
a truly global perspective.

MUTUAL SERIES. Founded in 1949, Mutual Series
is dedicated to a unique style of value
investing, searching aggressively for
opportunity among what it believes are
undervalued stocks, as well as arbitrage
situations and distressed securities.

TRUE DIVERSIFICATION Because our management groups work
independently and adhere to different
investment approaches, Franklin, Templeton and
Mutual Series funds typically have distinct
portfolios. That's why our funds can be used
to build truly diversified allocation plans
covering every major asset class.

RELIABILITY YOU CAN TRUST At Franklin Templeton Investments, we seek to
consistently provide investors with
exceptional risk-adjusted returns over the
long term, as well as the reliable, accurate
and personal service that has helped us become
one of the most trusted names in financial
services.

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MUTUAL FUNDS | RETIREMENT PLANS | 529 COLLEGE SAVINGS PLANS | SEPARATE ACCOUNTS
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[GRAPHIC OMITTED]

Not part of the annual report

Contents

ANNUAL REPORT

Templeton Emerging Markets Fund ........................................... 1

Performance Summary ....................................................... 7

Important Notice to Shareholders .......................................... 8

Financial Highlights and Statement of Investments ......................... 9

Financial Statements ...................................................... 16

Notes to Financial Statements ............................................. 19

Report of Independent Registered Public

Accounting Firm ........................................................... 26

Tax Designation ........................................................... 27

Annual Meeting of Shareholders ............................................ 29

Dividend Reinvestment and Cash Purchase Plan .............................. 30

Board Members and Officers ................................................ 32

Shareholder Information ................................................... 38

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ANNUAL REPORT

TEMPLETON EMERGING MARKETS FUND

YOUR FUND'S GOAL AND MAIN INVESTMENTS: Templeton Emerging Markets Fund seeks
long-term capital appreciation by investing, under normal market conditions, at
least 80% of its net assets in emerging country equity securities.

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GEOGRAPHIC BREAKDOWN
Based on Total Net Assets as of 8/31/05

[PIE CHART OMITTED]

Asia ...................................... 57.6%
Europe .................................... 18.0%
Latin America & Caribbean ................. 13.1%
Middle East & Africa ....................... 7.9%
Short-Term Investments & Other Net Assets .. 3.4%

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Dear Shareholder:

This annual report for Templeton Emerging Markets Fund covers the fiscal year
ended August 31, 2005. Also in the report is new information about the

THE DOLLAR VALUE, NUMBER OF SHARES OR PRINCIPAL AMOUNT, AND NAMES OF ALL
PORTFOLIO HOLDINGS ARE LISTED IN THE FUND'S STATEMENT OF INVESTMENTS (SOI). THE
SOI BEGINS ON PAGE 10.

Annual Report | 1

Board of Trustees' approval of the Fund's investment advisory contract in the
past six months. It is designed to give you an understanding of several factors
considered before the Board approved the Fund's contract with the Investment
Manager. The disclosure is in the "Shareholder Information" section beginning on
page 38.

PERFORMANCE OVERVIEW

For the 12-month period ended August 31, 2005, Templeton Emerging Markets Fund
delivered cumulative total returns of +30.66% based on market price and +36.43%
based on net asset value. The Morgan Stanley Capital International (MSCI)
Emerging Markets (EM) Index posted a 42.40% cumulative total return for the same
period.(1) In line with our investment strategy, we are pleased with our
long-term results, which you will find in the Performance Summary on page 7. For
example, for the 10-year period ended August 31, 2005, the Fund delivered
cumulative total returns of +121.30% based on market price and +134.07% based on
net asset value, compared with the MSCI EM Index's 64.54% cumulative total
return for the same period.(1) Please note that index performance information is
provided for reference and that we do not attempt to track the index, but rather
undertake investments on the basis of fundamental research.

ECONOMIC AND MARKET OVERVIEW

Emerging markets recorded strong performances during the year under review,
generally outperforming the major developed markets. Solid economic
fundamentals, attractive stock valuations and greater investor confidence helped
to propel emerging market stock prices. A weaker U.S. dollar versus most major
emerging markets currencies further enhanced emerging market stock returns in
U.S. dollar terms. Eastern European and Latin American markets outperformed
their other emerging market peers as both regions continued to attract
significant foreign investment inflows.

Eastern European stock markets benefited from greater European Union (EU) trade
bloc integration, while high oil prices provided a boost for the Russian
economy, which is heavily dependent on oil exports. In Turkey, the stock

(1) Source: Standard & Poor's Micropal. The MSCI EM Index is a free
float-adjusted, market capitalization-weighted index designed to measure
equity market performance in the global emerging markets. As of 8/31/05,
the Fund's 10-year average annual total returns were +8.27% based on
market price and +8.88% based on net asset value, compared with the MSCI
EM Index's 5.11% average annual total return for the same period. The
index is unmanaged and includes reinvested dividends. One cannot invest
directly in an index, nor is an index representative of the Fund's
portfolio.

2 | Annual Report

market rose as the government continued efforts to ensure that the country's EU
accession talks begin in October 2005. Additional financial support from the
International Monetary Fund (IMF) and World Bank further supported the Turkish
economy.

Latin American countries continued to record strong economic growth in 2004 and
thus far in 2005, continuing an overall recovery from 2003's slow-growth
environment. Argentina benefited from successful debt refi-nancing, while Brazil
reduced its risk profile through newly implemented reforms and effective fiscal
policy. Elsewhere, high oil prices were a boon for Mexico, a major oil producer.
These countries' stock markets enjoyed robust performance.

Asian markets generally lagged other emerging markets' performance as concerns
about the economic impact of record high oil prices weighed on investors,
largely because almost all of Asia's major economies are net oil importers.
Rising interest rates in the region as well as in the U.S. also appeared to
dampen investor activity.

In South Africa, greater private consumption, proactive black empowerment
efforts and the government's successful macroeconomic policies contributed to
the country's stock market gains. High commodity prices also helped boost South
African corporate earnings.

INVESTMENT STRATEGY

Our investment strategy employs a bottom-up, value-oriented, long-term approach.
We focus on the market price of a company's securities relative to our
evaluation of the company's long-term earnings, asset value and cash flow
potential. As we look for investments, we focus on specific companies and
undertake in-depth research to construct an action list from which we make our
buy decisions. Before we make a purchase, we look at the company's potential for
earnings and growth over a five-year horizon. During our analysis, we also
consider the company's position in its sector, the economic framework and
political environment.

MANAGER'S DISCUSSION

The Fund's performance, relative to the MSCI EM Index, benefited from our stock
selection in South Korea and Poland, and an overweighted position in Austria. In
South Korea, the Fund's overweighted investments in Samsung Heavy Industries,
Hyundai Development and Daewoo Shipbuilding & Marine Engineering had the largest
positive impact on relative performance this year. Conversely, underweighted
positions in South Africa and Mexico had a

TOP 10 COUNTRIES
Based on Equity Investments as of 8/31/05

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% OF TOTAL
NET ASSETS
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South Korea 16.9%
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Taiwan 13.4%
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China 9.6%
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Brazil 8.5%
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South Africa 7.9%
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Singapore 5.3%
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Mexico 4.3%
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Russia 3.4%
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India 3.4%
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Turkey 3.1%
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Annual Report | 3

TOP 10 EQUITY HOLDINGS
8/31/05

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COMPANY % OF TOTAL
SECTOR/INDUSTRY, COUNTRY NET ASSETS
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Samsung Electronics Co. Ltd. 3.2%
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT, SOUTH KOREA
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China Mobile (Hong Kong) Ltd., fgn. 3.1%
WIRELESS TELECOMMUNICATION
SERVICES, CHINA
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Anglo American PLC 2.1%
METALS & MINING, SOUTH AFRICA
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Remgro Ltd. 2.0%
DIVERSIFIED FINANCIAL SERVICES,
SOUTH AFRICA
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Keppel Corp. Ltd. 1.9%
INDUSTRIAL CONGLOMERATES, SINGAPORE
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Kimberly Clarke de Mexico SA de CV, A 1.8%
HOUSEHOLD PRODUCTS, MEXICO
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Petroleo Brasileiro SA, ADR, pfd. 1.8%
OIL, GAS & CONSUMABLE FUELS, BRAZIL
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Banco Bradesco SA, ADR, pfd. 1.8%
COMMERCIAL BANKS, BRAZIL
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Daewoo Shipbuilding & Marine
Engineering Co. Ltd. 1.7%
MACHINERY, SOUTH KOREA
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HSBC Holdings PLC 1.7%
COMMERCIAL BANKS, U.K.
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negative impact on our relative performance. Both countries' markets recorded
substantial gains during the year, which eventually made market valuations
relatively expensive in our opinion and, according to our investment strategy,
we sold some shares when certain holdings reached our sale targets.

With regard to sectors, the Fund benefited from its overweighted exposure to
capital goods relative to the index.(2) Favorable stock selection in the
transportation sector also boosted the Fund's returns.(3) In addition to the
South Korean transportation holdings mentioned earlier, other positive
contributors included Keppel Corporation of Singapore and Shipping Corporation
of India (sold by period-end). An underweighted exposure to semiconductor and
semiconductor equipment companies, in large part due to our decision to not
invest in United Micro Electronics, also supported relative performance. The
Fund did not hold this company's stock; instead, we invested in its peers, such
as Taiwan Semiconductor Manufacturing (TSMC) and Samsung Electronics. On the
other hand, an overweighted exposure to Taiwan Mobile and no exposure to America
Movil and Orascom Telecom were reasons that telecommunication services recorded
the Fund's largest negative sector performance relative to the index.(4) The
Fund did not own these two stocks due to what we perceived as expensive
valuations and the availability of better-valued telecommunications stocks in
other markets. To a lesser extent, our underweighted position in utilities and
stock selection in the food, beverage and tobacco sector also hindered the
Fund's overall results.(5)

It is important to recognize the effect of currency movements on the Fund's
performance. In general, if the value of the U.S. dollar increases compared with
a foreign currency, an investment traded in that foreign currency will decrease
in value because it will be worth fewer U.S. dollars. This can have a negative
effect on Fund performance. Conversely, when the U.S. dollar weakens in relation
to a foreign currency, an investment traded in that foreign currency will
increase in value, which can contribute to Fund performance. For the 12 months
ended August 31, 2005, the U.S. dollar fell in value relative to most non-U.S.
currencies. As a result, the Fund's performance was positively affected by the
portfolio's predominant investment in securities with non-U.S. currency
exposure. However, one cannot expect the same result in future periods.

(2) In the SOI, the capital goods sector comprises aerospace and defense,
construction and engineering, industrial conglomerates, and machinery.

(3) In the SOI, the transportation sector comprises airlines, road and rail,
and transportation infrastructure.

(4) In the SOI, the telecommunication services sector comprises diversified
telecommunication services and wireless telecommunication services.

(5) In the SOI, the utilities sector comprises gas utilities, electric
utilities, multi-utilities and water utilities, while the food, beverage
and tobacco sector comprises beverages and food products.

4 | Annual Report

During the year under review, we implemented various changes to the Fund's
portfolio structure. The Fund's largest additions were in Asia, including a
greater exposure to Taiwanese, Thai and Malaysian equities. Key investments
included stocks of the aforementioned TSMC, a leading global integrated circuit
producer; Kasikornbank, one of Thailand's largest banks; and Maxis
Communications, Malaysia's leading telecommunications service provider. Within
the region, more South Korean stocks, China Red Chip (Hong Kong-listed companies
with significant exposure to China) shares and Hong Kong stocks were sold than
bought, primarily because a number of our existing holdings reached their
respective sales targets.

In Latin America, the Fund increased its Brazilian investments through purchases
of shares of Petroleo Brasileiro (Petrobras), the national oil and gas company
with activities in exploration, production, refining, transportation and
distribution of oil and petroleum byproducts; and Centrais Eletricas Brasileiras
(Eletrobras), the Brazilian government's electric sector holding company with
electricity generation and transmission responsibilities. During the year under
review, Petrobras continued to benefit from high global oil prices. The largest
sales in the Latin American region included shares of Telefonos de Mexico
(Telmex), Mexico's largest telecommunications company; and Luxembourg-domiciled
Tenaris, the leading manufacturer of seamless steel pipes for the world's oil
and gas industry with manufacturing facilities in Argentina, Brazil, Mexico and
Venezuela.

As a result of the strong appreciation in Eastern European markets, the Fund's
investments in the region grew increasingly expensive, triggering sell targets.
The largest sales took place in Austria, Hungary and Greece. Substantial sales
were also undertaken in South Africa as the Fund reduced its holdings in
SABMiller, the dominant South African brewer, and Sasol, a multidiscipline fuel
extraction and manufacturing company.

Our global search for undervalued stocks resulted in purchases of select
U.K.- and Sweden-based equities. These companies offer significant business
operations in emerging markets. For example, we increased the Fund's shares of
HSBC Holdings, one of the world's largest banking and financial services
organizations; Provident Financial, a consumer finance company with exposure to
Central Europe, Eastern Europe and Latin America; and Oriflame Cosmetics, a
cosmetics company that operates in Central and Eastern Europe.

Annual Report | 5

We thank you for your interest in Templeton Emerging Markets Fund and look
forward to serving your future investment needs.

Sincerely,

/s/ Mark Mobius
[PHOTO OMITTED]
Mark Mobius

President and Chief Executive Officer -
Investment Management
Templeton Emerging Markets Fund

THE FOREGOING INFORMATION REFLECTS OUR ANALYSIS, OPINIONS AND PORTFOLIO HOLDINGS
AS OF AUGUST 31, 2005, THE END OF THE REPORTING PERIOD. THE WAY WE IMPLEMENT OUR
MAIN INVESTMENT STRATEGIES AND THE RESULTING PORTFOLIO HOLDINGS MAY CHANGE
DEPENDING ON FACTORS SUCH AS MARKET AND ECONOMIC CONDITIONS. THESE OPINIONS MAY
NOT BE RELIED UPON AS INVESTMENT ADVICE OR AN OFFER FOR A PARTICULAR SECURITY.
THE INFORMATION IS NOT A COMPLETE ANALYSIS OF EVERY ASPECT OF ANY MARKET,
COUNTRY, INDUSTRY, SECURITY OR THE FUND. STATEMENTS OF FACT ARE FROM SOURCES
CONSIDERED RELIABLE, BUT THE INVESTMENT MANAGER MAKES NO REPRESENTATION OR
WARRANTY AS TO THEIR COMPLETENESS OR ACCURACY. ALTHOUGH HISTORICAL PERFORMANCE
IS NO GUARANTEE OF FUTURE RESULTS, THESE INSIGHTS MAY HELP YOU UNDERSTAND OUR
INVESTMENT MANAGEMENT PHILOSOPHY.

6 | Annual Report

PERFORMANCE SUMMARY AS OF 8/31/05

Your dividend income will vary depending on dividends or interest paid by
securities in the Fund's portfolio, adjusted for operating expenses. Capital
gain distributions are net profits realized from the sale of portfolio
securities. Total return reflects reinvestment of the Fund's dividends and
capital gain distributions, if any, and any unrealized gains or losses. All
total returns include reinvested distributions according to the terms specified
in the Fund's dividend reinvestment and cash purchase plan and do not reflect
any sales charges paid at inception or brokerage commissions paid on secondary
market purchases. The performance table does not reflect any taxes due on Fund
dividends, capital gains distributions, if any, or realized gains on the sale of
Fund shares.

PRICE AND DISTRIBUTION INFORMATION

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SYMBOL: EMF CHANGE 8/31/05 8/31/04
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Net Asset Value (NAV) +$4.58 $17.98 $13.40
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Market Price (NYSE) +$4.07 $18.31 $14.24
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DISTRIBUTIONS (9/1/04-8/31/05)
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Dividend Income $0.2452
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PERFORMANCE
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1-YEAR 5-YEAR 10-YEAR
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Cumulative Total Return(1)
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Based on change in NAV +36.43% + 70.60% +134.07%
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Based on change in market price +30.66% +113.30% +121.30%
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Average Annual Total Return(1)
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Based on change in NAV +36.43% +11.28% +8.88%
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Based on change in market price +30.66% +16.36% +8.27%
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PERFORMANCE DATA REPRESENT PAST PERFORMANCE, WHICH DOES NOT GUARANTEE FUTURE
RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, AND YOU MAY HAVE
A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. CURRENT PERFORMANCE MAY DIFFER FROM
FIGURES SHOWN.

FOR MORE CURRENT PERFORMANCE, CALL FRANKLIN TEMPLETON INVESTMENTS AT
1-800/342-5236.

ENDNOTES

SPECIAL RISKS ARE ASSOCIATED WITH FOREIGN INVESTING, INCLUDING CURRENCY
VOLATILITY, ECONOMIC INSTABILITY AND POLITICAL DEVELOPMENTS OF COUNTRIES WHERE
THE FUND INVESTS. EMERGING MARKETS INVOLVE HEIGHTENED RISKS RELATED TO THE SAME
FACTORS, IN ADDITION TO THOSE ASSOCIATED WITH THEIR RELATIVELY SMALL SIZE AND
LESSER LIQUIDITY.

(1) Total return calculations represent the cumulative and average annual
changes in value of an investment over the periods indicated.

Annual Report | 7

IMPORTANT NOTICE TO SHAREHOLDERS

SHARE REPURCHASE PROGRAM

The Fund's Board previously authorized management to implement an open-market
share repurchase program pursuant to which the Fund may purchase Fund shares,
from time to time, in open-market transactions, at the discretion of management.
This authorization remains in effect.

8 | Annual Report

TEMPLETON EMERGING MARKETS FUND

FINANCIAL HIGHLIGHTS

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YEAR ENDED AUGUST 31,
2005 2004 2003 2002 2001
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PER SHARE OPERATING PERFORMANCE
(for a share outstanding throughout the year)

Net asset value, beginning of year ............................ $ 13.40 $ 10.82 $ 8.76 $ 8.86 $ 11.44
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Income from investment operations:

Net investment income(a) ..................................... 0.32 0.22 0.18 0.15 0.12

Net realized and unrealized gains (losses) ................... 4.51 2.59 2.03 (0.14) (2.60)
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Total from investment operations .............................. 4.83 2.81 2.21 0.01 (2.48)
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Less distributions from net investment income ................. (0.25) (0.23) (0.15)) (0.11) (0.10)
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Net asset value, end of year .................................. $ 17.98 $ 13.40 $ 10.82 $ 8.76 $ 8.86
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Market value, end of year(b) .................................. $ 18.31 $ 14.24 $ 11.84 $ 8.00 $ 8.35
==================================================================

Total return (based on market value per share) ................ 30.66% 22.62% 50.83% (2.82)% (9.17)%

RATIOS/SUPPLEMENTAL DATA

Net assets, end of year (000's) ............................... $ 318,240 $ 236,848 $ 191,076 $ 154,640 $ 156,378

Ratios to average net assets:

Expenses ..................................................... 1.57% 1.63% 1.84% 1.64% 1.67%

Net investment income ........................................ 2.00% 1.70% 1.94% 1.67% 1.28%

Portfolio turnover rate ....................................... 36.04% 67.63% 48.69% 65.13% 63.64%

(a) Based on average daily shares outstanding.

(b) Based on the last sale on the New York Stock Exchange.

Annual Report | See notes to financial statements. | 9

TEMPLETON EMERGING MARKETS FUND

STATEMENT OF INVESTMENTS, AUGUST 31, 2005

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INDUSTRY SHARES/RIGHTS VALUE
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COMMON STOCKS 91.2%
AUSTRIA 0.9%
Bank Austria Creditanstalt ....................... Commercial Banks 23,946 $ 2,708,249
-----------
BELGIUM 0.6%
Inbev ............................................ Beverages 44,650 1,742,385
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BERMUDA 0.0%(a)
Gome Electrical Appliances Holdings Ltd. ......... Specialty Retail 130,000 80,292
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BRAZIL 3.1%
Centrais Eletricas Brasileiras SA ................ Electric Utilities 67,922,000 939,797
Centrais Eletricas Brasileiras SA (Non-Taxable) .. Electric Utilities 110,472,000 1,528,537
Cia de Bebidas das Americas (AmBev), ADR ......... Beverages 14,820 380,133
Embraer-Empresa Bras de Aeronautica SA ........... Aerospace & Defense 287,066 1,949,432
(b)Localiza Rent a Car SA, 144A ..................... Diversified Consumer Services 119,000 818,217
Souza Cruz SA .................................... Tobacco 246,473 2,761,719
Unibanco Uniao de Bancos Brasileiros SA, GDR ..... Commercial Banks 30,000 1,341,600
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9,719,435
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CHINA 9.6%
(b),(c)Air China Ltd., H, 144A .......................... Airlines 397,000 120,045
Aluminum Corp. of China Ltd., H .................. Metals & Mining 3,824,000 2,103,492
Anhui Conch Cement Co. Ltd., H ................... Construction Materials 1,234,000 1,111,476
Beijing Enterprises Holdings Ltd. ................ Industrial Conglomerates 42,162 59,134
Brilliance China Automotive Holdings Ltd. ........ Automobiles 978,000 166,111
China International Marine Containers Co. Ltd., B Machinery 357,500 351,904
China Mobile (Hong Kong) Ltd., fgn ............... Wireless Telecommunication Services 2,295,500 9,924,379
China Resources Enterprise Ltd. .................. Distributors 1,974,000 3,136,901
China Travel International Investment
Hong Kong Ltd. .................................. Hotels, Restaurants & Leisure 1,396,000 431,105
Chongqing Changan Automobile Co. Ltd., B ......... Automobiles 649,800 325,249
CITIC Pacific Ltd. ............................... Industrial Conglomerates 757,192 2,109,360
Denway Motors Ltd. ............................... Automobiles 4,906,730 1,799,384
Huadian Power International Corp. Ltd., H ........ Independent Power Producers & Energy Traders 2,922,000 808,361
Huaneng Power International Inc., H .............. Independent Power Producers & Energy Traders 444,000 314,219
Lenovo Group Ltd. ................................ Computers & Peripherals 1,006,000 414,223
PetroChina Co. Ltd., H ........................... Oil, Gas & Consumable Fuels 5,118,000 4,148,849
Shanghai Industrial Holdings Ltd. ................ Industrial Conglomerates 946,000 1,795,436
TCL Multimedia Technology Holdings Ltd. .......... Household Durables 1,076,000 196,602
Travelsky Technology Ltd., H ..................... IT Services 1,320,000 1,146,475
-----------
30,462,705
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CROATIA 0.8%
(c)Pliva d.d., GDR, Reg S ........................... Pharmaceuticals 194,200 2,462,456
-----------
GREECE 0.3%
Coca-Cola Hellenic Bottling Co. SA ............... Beverages 18,770 575,046
Titan Cement Co. ................................. Construction Materials 14,185 495,110
-----------
1,070,156
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10 | Annual Report

TEMPLETON EMERGING MARKETS FUND

STATEMENT OF INVESTMENTS, AUGUST 31, 2005 (CONTINUED)

COMMON STOCKS (CONT.)
HONG KONG 2.8%
Cathay Pacific Airways Ltd. ....................... Airlines 149,000 $ 276,080
Cheung Kong Holdings Ltd. ......................... Real Estate 458,000 4,967,980
Cheung Kong Infrastructure Holdings Ltd. .......... Electric Utilities 284,000 893,478
Dairy Farm International Holdings Ltd.
(USD Traded) ..................................... Food & Staples Retailing 239,200 736,736
Guoco Group Ltd. .................................. Diversified Financial Services 32,506 324,573
Hopewell Holdings Ltd. ............................ Transportation Infrastructure 43,000 110,382
MTR Corp. Ltd. .................................... Road & Rail 728,996 1,477,381
-----------
8,786,610
-----------
HUNGARY 2.6%
BorsodChem Rt ..................................... Chemicals 30,707 390,935
Gedeon Richter Ltd. ............................... Pharmaceuticals 13,349 2,125,023
Magyar Telekom Ltd. ............................... Diversified Telecommunication Services 723,139 3,653,324
MOL Magyar Olaj-Es Gazipari Rt. ................... Oil, Gas & Consumable Fuels 18,730 2,056,193
-----------
8,225,475
-----------
INDIA 3.4%
Gail India Ltd. ................................... Gas Utilities 331,410 1,754,346
Hindustan Lever Ltd. .............................. Household Products 827,600 3,113,957
Hindustan Petroleum Corp. Ltd. .................... Oil, Gas & Consumable Fuels 424,023 2,817,189
Indian Oil Corp. Ltd. ............................. Oil, Gas & Consumable Fuels 5,800 55,168
National Aluminum Co. Ltd. ........................ Metals & Mining 87,000 334,562
Tata Motors Ltd. .................................. Machinery 42,800 449,971
Tata Tea Ltd. ..................................... Food Products 120,315 2,240,824
-----------
10,766,017
-----------
INDONESIA 0.1%
PT Bank Danamon ................................... Commercial Banks 707,500 309,102
-----------
MALAYSIA 2.3%
Kuala Lumpur Kepong Bhd. .......................... Food Products 221,600 419,874
Maxis Communications Bhd. ......................... Wireless Telecommunication Services 780,000 1,950,000
Resorts World Bhd. ................................ Hotels, Restaurants & Leisure 790,600 2,142,942
SIME Darby Bhd. ................................... Industrial Conglomerates 802,100 1,277,028
Tanjong PLC ...................................... Hotels, Restaurants & Leisure 168,100 597,197
YTL Corp. Bhd. .................................... Multi-Utilities 304,346 440,501
YTL Power International Bhd. ...................... Water Utilities 1,003,184 549,111
-----------
7,376,653
-----------
MEXICO 4.3%
Fomento Economico Mexicano SA de CV (Femsa),
ADR .............................................. Beverages 66,789 4,576,382
Grupo Bimbo SA de CV, A ........................... Food Products 185,771 571,829
Kimberly Clark de Mexico SA de CV, A .............. Household Products 1,765,200 5,806,163
Telefonos de Mexico SA de CV (Telmex), L, ADR ..... Diversified Telecommunication Services 149,974 2,879,501
-----------
13,833,875
-----------

Annual Report | 11

TEMPLETON EMERGING MARKETS FUND

STATEMENT OF INVESTMENTS, AUGUST 31, 2005 (CONTINUED)

COMMON STOCKS (CONT.)
PANAMA 0.3%
Banco Latinoamericano de Exportaciones SA, E ....... Commercial Banks 62,600 $ 1,072,964
-----------
PHILIPPINES 1.0%
San Miguel Corp., B ................................ Beverages 1,928,599 3,238,607
-----------
POLAND 2.6%
Polski Koncern Naftowy Orlen SA .................... Oil, Gas & Consumable Fuels 168,042 2,901,326
Prokom Software SA ................................. IT Services 2,400 84,791
Telekomunikacja Polska SA .......................... Diversified Telecommunication Services 741,500 5,125,497
-----------
8,111,614
-----------
PORTUGAL 0.2%
Jeronimo Martins SGPS SA ........................... Food & Staples Retailing 46,650 678,347
-----------
RUSSIA 3.4%
Lukoil Holdings, ADR ............................... Oil, Gas & Consumable Fuels 94,356 4,585,701
Mining and Metallurgical Co. Norilsk Nickel ........ Metals & Mining 50,100 3,572,130
Mobile Telesystems, ADR ............................ Wireless Telecommunication Services 75,100 2,778,700
-----------
10,936,531
-----------
SINGAPORE 5.3%
ComfortDelGro Corp. Ltd. ........................... Road & Rail 1,404,000 1,202,355
Fraser & Neave Ltd. ................................ Industrial Conglomerates 434,367 4,313,963
Keppel Corp. Ltd. .................................. Industrial Conglomerates 882,000 6,084,567
Singapore Press Holdings Ltd. ...................... Media 456,250 1,226,435
Singapore Technologies Engineering Ltd. ............ Aerospace & Defense 676,000 1,045,257
Singapore Telecommunications Ltd. .................. Diversified Telecommunication Services 2,000,142 3,068,907
-----------
16,941,484
-----------
SOUTH AFRICA 7.9%
Anglo American PLC ................................. Metals & Mining 261,043 6,633,563
Nampak Ltd. ........................................ Containers & Packaging 136,900 330,707
Nedbank Group Ltd. ................................. Commercial Banks 226,110 3,117,303
(b)Nedbank Group Ltd., 144A ........................... Commercial Banks 26,167 360,756
Old Mutual PLC (GBP Traded) ........................ Insurance 1,652,510 4,206,546
Remgro Ltd. ........................................ Diversified Financial Services 391,649 6,512,125
SABMiller PLC ...................................... Beverages 93,448 1,649,669
Sappi Ltd. ......................................... Paper & Forest Products 184,700 1,974,479
Sasol Ltd. ......................................... Oil, Gas & Consumable Fuels 10,200 344,000
The Spar Group Ltd. ................................ Food & Staples Retailing 27,000 120,918
-----------
25,250,066
-----------
SOUTH KOREA 16.9%
CJ Corp. ........................................... Food Products 42,110 2,680,280
Daelim Industrial Co. .............................. Construction & Engineering 4,000 236,880
Daewoo Shipbuilding & Marine
Engineering Co. Ltd. .............................. Machinery 285,860 5,505,248
Hana Bank .......................................... Commercial Banks 124,840 3,756,620
Hite Brewery Co. Ltd. .............................. Beverages 18,045 1,824,483

12 | Annual Report

TEMPLETON EMERGING MARKETS FUND

STATEMENT OF INVESTMENTS, AUGUST 31, 2005 (CONTINUED)

COMMON STOCKS (CONT.)
SOUTH KOREA (CONT.)
Hyundai Development Co. .......................... Construction & Engineering 144,210 $ 3,846,526
Kangwon Land Inc. ................................ Hotels, Restaurants & Leisure 241,368 3,776,822
Korea Gas Corp. .................................. Gas Utilities 39,480 1,136,690
(c)LG Card Co. Ltd. ................................. Consumer Finance 39,730 1,224,227
LG Chem Ltd. ..................................... Chemicals 67,500 2,749,398
(c)LG Corp. ......................................... Industrial Conglomerates 124,000 2,865,672
LG Electronics Inc. .............................. Household Durables 19,180 1,150,615
LG Household & Health Care Ltd. .................. Household Products 35,930 1,857,911
LG Petrochemical Co. Ltd. ........................ Chemicals 42,920 1,064,218
Samsung Electronics Co. Ltd. ..................... Semiconductors & Semiconductor Equipment 19,326 10,123,586
Samsung Fine Chemicals Co. Ltd. .................. Chemicals 103,070 2,362,124
Samsung Heavy Industries Co. Ltd. ................ Machinery 129,680 1,642,072
Shinhan Financial Group Co. Ltd. ................. Commercial Banks 52,000 1,522,196
SK Corp. ......................................... Oil, Gas & Consumable Fuels 32,730 1,616,802
SK Telecom Co. Ltd. .............................. Wireless Telecommunication Services 15,530 2,826,355
-----------
53,768,725
-----------
SWEDEN 0.8%
Oriflame Cosmetics, IDR .......................... Personal Products 102,648 2,477,912
-----------
TAIWAN 13.4%
Acer Inc. ........................................ Computers & Peripherals 575,362 1,089,235
BenQ Corp. ....................................... Computers & Peripherals 808,000 752,489
Chunghwa Telecom Co. Ltd. ........................ Diversified Telecommunication Services 1,234,000 2,298,443
D-Link Corp. ..................................... Communications Equipment 2,296,946 2,226,810
Delta Electronics Inc. ........................... Electronic Equipment & Instruments 1,107,179 1,795,151
Elan Microelectronics Corp. ...................... Semiconductors & Semiconductor Equipment 635,927 281,555
Giant Manufacturing Co. .......................... Leisure Equipment & Products 20,000 32,672
Kinpo Electronics Inc. ........................... Office Electronics 4,734 2,031
Lite-On Technology Corp. ......................... Computers & Peripherals 2,560,098 2,646,086
MediaTek Inc. .................................... Semiconductors & Semiconductor Equipment 438,900 3,712,223
(c)Mega Financial Holdings Co. Ltd. ................. Commercial Banks 7,206,661 4,775,101
Premier Image Technology Corp. ................... Leisure Equipment & Products 1,619,160 1,878,720
President Chain Store Corp. ...................... Food & Staples Retailing 1,042,188 1,880,712
Realtek Semiconductor Corp. ...................... Semiconductors & Semiconductor Equipment 1,891,200 1,894,087
Siliconware Precision Industries Co. Ltd. ........ Semiconductors & Semiconductor Equipment 1,127,561 1,007,058
(c)Sunplus Technology Co. Ltd. ...................... Semiconductors & Semiconductor Equipment 1,673,530 1,673,530
Synnex Technology International Corp. ............ Electronic Equipment & Instruments 1,112,320 1,321,198
Taiwan Mobile Co. Ltd. ........................... Wireless Telecommunication Services 5,151,372 4,781,732
Taiwan Semiconductor Manufacturing Co., Ltd. ..... Semiconductors & Semiconductor Equipment 2,787,044 4,595,431
UNI-President Enterprises Corp. .................. Food Products 6,615,350 2,474,444
Yuanta Core Pacific Securities Co. ............... Capital Markets 2,793,113 1,607,640
-----------
42,726,348
-----------

Annual Report | 13

TEMPLETON EMERGING MARKETS FUND

STATEMENT OF INVESTMENTS, AUGUST 31, 2005 (CONTINUED)

COMMON STOCKS (CONT.)
THAILAND 2.8%
Bangkok Bank Public Co. Ltd., fgn. ............. Commercial Banks 223,000 $ 600,437
BEC World Public Co. Ltd., fgn. ................ Media 1,562,900 534,552
Kasikornbank Public Co. Ltd., fgn. ............. Commercial Banks 1,564,300 2,390,561
Land and House Public Co. Ltd., fgn. ........... Household Durables 2,728,200 539,353
Shin Corp. Public Co. Ltd., fgn. ............... Wireless Telecommunication Services 1,319,000 1,215,816
Siam Cement Public Co. Ltd., fgn. .............. Construction Materials 242,706 1,412,964
Siam Commercial Bank Public Co. Ltd., fgn. ..... Commercial Banks 620,000 748,211
Siam Makro Public Co. Ltd., fgn. ............... Food & Staples Retailing 152,000 233,024
Thai Airways International Public Co. Ltd., fgn. Airlines 120,900 114,961
(c)TMB Bank Public Co. Ltd., fgn. ................. Commercial Banks 13,339,800 1,261,982
(c)True Corp. Public Co. Ltd., rts., 3/28/08 ...... Diversified Telecommunication Services 246,818 --
------------
9,051,861
------------
TURKEY 3.1%
Arcelik AS, Br ................................. Household Durables 469,047 2,771,404
Migros Turk TAS ................................ Food & Staples Retailing 276,485 2,363,120
(c)Petkim Petrokimya Holding AS ................... Chemicals 10,000 43,850
Tupras-Turkiye Petrol Rafineleri AS ............ Oil, Gas & Consumable Fuels 207,280 3,173,517
Turkiye Is Bankasi, C .......................... Commercial Banks 248,851 1,479,604
------------
9,831,495
------------
UNITED KINGDOM 2.7%
HSBC Holdings PLC .............................. Commercial Banks 338,346 5,420,223
Provident Financial PLC ........................ Consumer Finance 267,970 3,095,545
------------
8,515,768
------------
TOTAL COMMON STOCKS (COST $212,020,479) ........ 290,145,132
------------
PREFERRED STOCKS 5.4%
BRAZIL 5.4%
Banco Bradesco SA, ADR, pfd. ................... Commercial Banks 131,537 5,600,846
Cia de Bebidas das Americas (AmBev), ADR, pfd. . Beverages 71,700 2,301,570
Cia Vale do Rio Doce, ADR, pfd., A ............. Metals & Mining 86,100 2,583,000
Klabin SA, pfd. ................................ Containers & Packaging 6,000 11,612
Petroleo Brasileiro SA, ADR, pfd. .............. Oil, Gas & Consumable Fuels 102,880 5,657,371
Suzano Bahia Sul Papel e Celulose SA, pfd., A .. Paper & Forest Products 130,578 571,393
Usinas Siderurgicas de Minas Gerais SA, pfd., A Metals & Mining 31,800 659,458
------------
TOTAL PREFERRED STOCKS (COST $8,728,422) ....... 17,385,250
------------
SHORT TERM INVESTMENTS (COST $9,871,361) 3.1%
(d)Franklin Institutional Fiduciary Trust Money
Market Portfolio .............................. 9,871,361 9,871,361
------------
TOTAL INVESTMENTS (COST $230,620,262) 99.7% .... 317,401,743
OTHER ASSETS, LESS LIABILITIES 0.3% ............ 838,668
------------
NET ASSETS 100.0% .............................. $318,240,411
============

14 | Annual Report

TEMPLETON EMERGING MARKETS FUND

STATEMENT OF INVESTMENTS, AUGUST 31, 2005 (CONTINUED)

CURRENCY ABBREVIATIONS:

GBP - British Pound

SELECTED PORTFOLIO ABBREVIATIONS:

ADR - American Depository Receipt
GDR - Global Depository Receipt
IDR - International Depository Receipt

(a) Rounds to less than 0.05% of net assets.

(b) Security was purchased pursuant to Rule 144A under the Securities Act of
1933 and may be sold in transactions exempt from registration only to
qualified institutional buyers or in a public offering registered under
the Securities Act of 1933. These securities have been deemed liquid under
guidelines approved by the Fund's Board of Trustees.

(d) See Note 8 regarding investments in Franklin Institutional Fiduciary Trust
Money Market Portfolio.

Annual Report | See notes to financial statements. | 15

TEMPLETON EMERGING MARKETS FUND

FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES

August 31, 2005

Assets:
Investments in securities:
Cost - Unaffiliated issuers .............................. $220,748,901
Cost - Sweep Money Fund (Note 8) ......................... 9,871,361
------------
Total cost of investments ................................ $230,620,262
============
Value - Unaffiliated issuers ............................. $307,530,382
Value - Sweep Money Fund (Note 8) ........................ 9,871,361
------------
Total value of investments ............................... 317,401,743
Cash ...................................................... 123,356
Foreign currency, at value (cost $289,440) ................ 280,464
Receivables:
Investment securities sold ............................... 236,024
Dividends ................................................ 1,283,747
Foreign income tax receivable ............................ 209,035
------------
Total assets ....................................... 319,534,369
------------
Liabilities:
Payables:
Investment securities purchased .......................... 765,094
Affiliates ............................................... 393,848
Deferred taxes ............................................ 14,028
Other liabilities ......................................... 120,988
------------
Total liabilities .................................. 1,293,958
------------
Net assets, at value ............................ $318,240,411
============
Net assets consist of:
Paid-in capital ........................................... $205,320,924
Undistributed net investment income ....................... 2,172,086
Net unrealized appreciation (depreciation) ................ 86,756,843
Accumulated net realized gain (loss) ...................... 23,990,558
------------
Net assets, at value ............................ $318,240,411
============
Shares outstanding ......................................... 17,696,319
============
Net asset value per share .................................. $ 17.98
============

16 | See notes to financial statements. | Annual Report

TEMPLETON EMERGING MARKETS FUND

FINANCIAL STATEMENTS (CONTINUED)

STATEMENT OF OPERATIONS

for the year ended August 31, 2005

Investment income:
Dividends (net of foreign taxes of $882,393)
Unaffiliated issuers ....................................................................... $ 8,953,445
Sweep Money Fund (Note 8) .................................................................. 1,221,473
Interest (net of foreign taxes of $47) ..................................................... 193
------------
Total investment income .............................................................. 10,175,111
------------
Expenses:
Management fees (Note 3a) ................................................................... 3,527,802
Administrative fees (Note 3b) ............................................................... 427,223
Transfer agent fees ......................................................................... 79,800
Custodian fees (Note 4) ..................................................................... 280,081
Reports to shareholders ..................................................................... 69,800
Registration and filing fees ................................................................ 22,500
Professional fees ........................................................................... 22,845
Trustees' fees and expenses ................................................................. 33,300
Other ....................................................................................... 13,200
------------
Total expenses ....................................................................... 4,476,551
Expense reductions (Note 4) .......................................................... (966)
------------
Net expenses ...................................................................... 4,475,585
------------
Net investment income ......................................................... 5,699,526
------------
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments (including foreign tax refund of $209,035) ..................................... 30,458,465
Foreign currency transactions .............................................................. (176,789)
------------
Net realized gain (loss) .......................................................... 30,281,676
------------
Net change in unrealized appreciation (depreciation) on:
Investments ................................................................................ 49,523,911
Translation of assets and liabilities denominated in foreign currencies .................... (5,812)
Deferred taxes ............................................................................. (14,028)
------------
Net change in unrealized appreciation (depreciation) ............................... 49,504,071
------------
Net realized and unrealized gain (loss) ...................................................... 79,785,747
------------
Net increase (decrease) in net assets resulting from operations .............................. $ 85,485,273
============

Annual Report | See notes to financial statements. | 17

TEMPLETON EMERGING MARKETS FUND

FINANCIAL STATEMENTS (CONTINUED)

STATEMENTS OF CHANGES IN NET ASSETS

--------------------------------
YEAR ENDED AUGUST 31,
2005 2004
--------------------------------

Increase (decrease) in net assets:
Operations:
Net investment income ...................................................................... $ 5,699,526 $ 3,843,382
Net realized gain (loss) from investments and foreign currency transactions ................ 30,281,676 35,542,390
Net change in unrealized appreciation (depreciation) on investments, translation of
assets and liabilities denominated in foreign currencies, and deferred taxes ............. 49,504,071 10,197,407
--------------------------------
Net increase (decrease) in net assets resulting from operations ...................... 85,485,273 49,583,179
--------------------------------
Distributions to shareholders from net investment income .................................... (4,335,961) (4,094,975)
--------------------------------
Capital share transactions: (Note 2) ........................................................ 242,988 284,125
--------------------------------
Net increase (decrease) in net assets ................................................ 81,392,300 45,772,329
Net assets:
Beginning of year ........................................................................... 236,848,111 191,075,782
--------------------------------
End of year ................................................................................. $ 318,240,411 $ 236,848,111
================================
Undistributed net investment income included in net assets:
End of year ................................................................................. $ 2,172,086 $ 709,318
================================

18 | See notes to financial statements. | Annual Report

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Templeton Emerging Markets Fund (the Fund) is registered under the Investment
Company Act of 1940 as a diversified, closed-end investment company.

The following summarizes the Fund's significant accounting policies.

A. SECURITY VALUATION

Securities listed on a securities exchange or on the NASDAQ National Market
System are valued at the last quoted sale price or the official closing price of
the day, respectively. Over-the-counter securities and listed securities for
which there is no reported sale are valued within the range of the most recent
quoted bid and ask prices. Securities that trade in multiple markets or on
multiple exchanges are valued according to the broadest and most representative
market. Investments in open-end mutual funds are valued at the closing net asset
value.

Foreign securities are valued as of the close of trading on the foreign stock
exchange on which the security is primarily traded, or the NYSE, whichever is
earlier. If no sale is reported at that time, the foreign security will be
valued within the range of the most recent quoted bid and ask prices. The value
is then converted into its U.S. dollar equivalent at the foreign exchange rate
in effect at the close of the NYSE on the day that the value of the foreign
security is determined.

The Fund has procedures to determine the fair value of individual securities and
other assets for which market prices are not readily available or which may not
be reliably priced. Methods for valuing these securities may include:
fundamental analysis, matrix pricing, discounts from market prices of similar
securities, or discounts applied due to the nature and duration of restrictions
on the disposition of the securities. Due to the inherent uncertainty of
valuations of such securities, the fair values may differ significantly from the
values that would have been used had a ready market for such investments
existed. Occasionally, events occur between the time at which trading in a
security is completed and the close of the NYSE that might call into question
the availability (including the reliability) of the value of a portfolio
security held by the Fund. If such an event occurs, the securities may be valued
using fair value procedures, which may include the use of independent pricing
services. All security valuation procedures are approved by the Fund's Board of
Trustees.

B. FOREIGN CURRENCY TRANSLATION

Portfolio securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollars based on the exchange rate of such
currencies against U.S. dollars on the date of valuation. Purchases and sales of
securities, income and expense items denominated in foreign currencies are
translated into U.S. dollars at the exchange rate in effect on the transaction
date. Occasionally, events may impact the availability or reliability of foreign
exchange rates used to convert the U.S. dollar equivalent value. If such an
event occurs, the foreign exchange rate will be valued at fair value using
procedures established and approved by the Fund's Board of Trustees.

Annual Report | 19

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

B. FOREIGN CURRENCY TRANSLATION (CONTINUED)

The Fund does not separately report the effect of changes in foreign exchange
rates from changes in market prices on securities held. Such changes are
included in net realized and unrealized gain or loss from investments on the
Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on securities transactions and the difference between the recorded amounts
of dividends, interest, and foreign withholding taxes and the U.S. dollar
equivalent of the amounts actually received or paid. Net unrealized foreign
exchange gains and losses arise from changes in foreign exchange rates on
foreign denominated assets and liabilities other than investments in securities
held at the end of the reporting period.

C. FOREIGN CURRENCY CONTRACTS

When the Fund purchases or sells foreign securities it may enter into foreign
exchange contracts to minimize foreign exchange risk from the trade date to the
settlement date of the transactions. A foreign exchange contract is an agreement
between two parties to exchange different currencies at an agreed upon exchange
rate on a specified date. Realized and unrealized gains and losses on these
contracts are included in the Statement of Operations.

The risks of these contracts include movement in the values of the foreign
currencies relative to the U.S. dollar and the possible inability of the
counterparties to fulfill their obligations under the contracts, which may be in
excess of the amount reflected in the Statement of Assets and Liabilities.

D. INCOME AND DEFERRED TAXES

No provision has been made for U.S. income taxes because the Fund's policy is to
continue to qualify as a regulated investment company under the Internal Revenue
Code and to distribute to shareholders substantially all of its taxable income
and net realized gains.

The Fund is subject to a tax imposed on net realized gains of securities of
certain foreign countries. The Fund records an estimated deferred tax liability
for net unrealized gains on these securities in an amount that would be payable
if the securities were disposed of on the valuation date.

Foreign securities held by the Fund may be subject to foreign taxation. Foreign
taxes, if any, are recorded based on the tax regulations and rates that exist in
the foreign markets in which the Fund invests.

20 | Annual Report

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

E. SECURITY TRANSACTIONS, INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS

Security transactions are accounted for on trade date. Realized gains and losses
on security transactions are determined on a specific identification basis.
Interest income and estimated expenses are accrued daily. Dividend income is
recorded on the ex-dividend. Distributions to shareholders are recorded on the
ex-dividend date and are determined according to income tax regulations (tax
basis). Distributable earnings determined on a tax basis may differ from
earnings recorded in accordance with generally accepted accounting principles.
These differences may be permanent or temporary. Permanent differences are
reclassified among capital accounts to reflect their tax character. These
reclassifications have no impact on net assets or the results of operations.
Temporary differences are not reclassified, as they will reverse in subsequent
periods.

F. ACCOUNTING ESTIMATES

The preparation of financial statements in accordance with accounting principles
generally accepted 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 amounts of income
and expense during the reporting year. Actual results could differ from those
estimates.

G. GUARANTEES AND INDEMNIFICATIONS

Under the Fund's organizational documents, its officers and trustees are
indemnified by the Fund against certain liabilities arising out of the
performance of their duties to the Fund. Additionally, in the normal course of
business, the Fund enters into contracts with service providers that contain
general indemnification clauses. The Fund's maximum exposure under these
arrangements is unknown as this would involve future claims that may be made
against the Fund that have not yet occurred. However, based on experience, the
Fund expects the risk of loss to be remote.

2. SHARES OF BENEFICIAL INTEREST

The Board of the Fund previously authorized an open-market share repurchase
program pursuant to which the Fund may purchase, from time to time, Fund shares
in open-market transactions, at the discretion of management. This authorization
remains in effect.

At August 31, 2005, there were an unlimited number of shares authorized (without
par value). During the year ended August 31, 2005, 15,994 shares were issued for
$242,988 from reinvested distributions. During the year ended August 31, 2004,
23,888 shares were issued for $284,125 from reinvested distributions.

Annual Report | 21

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

3. TRANSACTIONS WITH AFFILIATES

Franklin Resources, Inc. is the holding company for various subsidiaries that
together are referred to as Franklin Templeton Investments. Certain officers and
trustees of the Fund are also officers and/or directors of the following
subsidiaries:

--------------------------------------------------------------------------------
SUBSIDIARY AFFILIATION
--------------------------------------------------------------------------------
Templeton Asset Management Ltd. (TAML) Investment manager
Franklin Templeton Services, LLC (FT Services) Administrative manager

A. MANAGEMENT FEES

The Fund pays an investment management fee to TAML based on the average daily
net assets of the Fund as follows:

--------------------------------------------------------------------------------
ANNUALIZED FEE RATE NET ASSETS
--------------------------------------------------------------------------------
1.250% Up to and including $1 billion
1.200% Over $1 billion, up to and including $5 billion
1.150% Over $5 billion, up to and including $10 billion
1.100% Over $10 billion, up to and including $15 billion
1.050% Over $15 billion, up to and including $20 billion
1.000% In excess of $20 billion

B. ADMINISTRATIVE FEES

The Fund pays an administrative fee to FT Services of 0.15% per year based on
the Fund's average daily net assets.

4. EXPENSE OFFSET ARRANGEMENT

The Fund has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash balances are used to reduce a portion of
the Fund's custodian expenses. During the year ended August 31, 2005, the
custodian fees were reduced as noted in the Statement of Operations.

5. INCOME TAXES

During the year ended August 31, 2005, the Fund utilized $5,657,930 of capital
loss carryforwards.

For tax purposes, realized currency losses occurring subsequent to October 31,
may be deferred and treated as occurring on the first day of the following
fiscal year. At August 31, 2005, the Fund deferred realized currency losses of
$147,996.

22 | Annual Report

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

5. INCOME TAXES (CONTINUED)

The tax character of distributions paid during the years ended August 31, 2005
and 2004, was as follows:

-----------------------
2005 2004
-----------------------
Distributions paid from - ordinary income ............. $4,335,961 $4,094,975

Net investment income differs for financial statement and tax purposes primarily
due to differing treatments of foreign currency transactions, passive foreign
investment company shares, and foreign tax refunds.

Net realized gains (losses) differ for financial statement and tax purposes
primarily due to differing treatments of wash sales, foreign currency
transactions, passive foreign investment company shares, and foreign tax
refunds.

At August 31, 2005, the cost of investments, net unrealized appreciation
(depreciation), undistributed ordinary income and undistributed long term
capital gains for income tax purposes were as follows:

Cost of investments ...................................... $ 235,149,241
=============
Unrealized appreciation .................................. $ 86,152,541
Unrealized depreciation .................................. (3,900,039)
-------------
Net unrealized appreciation (depreciation) ............... $ 82,252,502
=============
Undistributed ordinary income ............................ $ 6,510,466
Undistributed long term capital gains .................... 24,329,151
-------------
Distributable earnings ................................... $ 30,839,617
=============

6. INVESTMENT TRANSACTIONS

Purchases and sales of investments (excluding short-term securities) for the
year ended August 31, 2005 aggregated $98,956,087 and $104,606,963,
respectively.

7. RISK OF INVESTING IN FOREIGN SECURITIES

Investing in foreign securities may include certain risks and considerations not
typically associated with investing in U.S. securities, such as fluctuating
currency values and changing local and regional economic, political and social
conditions, which may result in greater market volatility. In addition, certain
foreign securities may not be as liquid as U.S. securities.

Annual Report | 23

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

8. INVESTMENTS IN FRANKLIN INSTITUTIONAL FIDUCIARY TRUST MONEY MARKET PORTFOLIO

The Fund may invest in the Franklin Institutional Fiduciary Trust Money Market
Portfolio (the Sweep Money Fund), an open-end investment company managed by
Franklin Advisers Inc. (an affiliate of the investment manager). Management fees
paid by the Fund are reduced on assets invested in the Sweep Money Fund, in an
amount not to exceed the management fees paid by the Sweep Money Fund.

9. REGULATORY MATTERS

INVESTIGATIONS AND SETTLEMENTS

As part of various investigations by a number of federal, state, and foreign
regulators and governmental entities, including the Securities and Exchange
Commission ("SEC"), the California Attorney General's Office ("CAGO"), and the
National Association of Securities Dealers, Inc. ("NASD"), relating to certain
practices in the mutual fund industry, including late trading, market timing and
marketing support payments to securities dealers who sell fund shares, Franklin
Resources, Inc. and certain of its subsidiaries (as used in this section,
together, the "Company"), as well as certain current or former executives and
employees of the Company, provided documents and information in response to
subpoenas and/or requests for documents, information and/or testimony. Beginning
in August 2004, the Company entered into settlements with certain of the
regulators and a governmental entity investigating the mutual fund industry
practices noted above. The Company believes that settlement of each of the
matters is in the best interest of the Company and shareholders of the Franklin,
Templeton, and Mutual Series mutual funds (the "funds").

Two of the settlement agreements, those with the SEC and the CAGO concerning
marketing support payments, provide that the distribution of settlement monies
are to be made to the relevant funds, not to individual shareholders. The CAGO
has approved the distribution plan pertaining to the distribution of the monies
owed under the CAGO settlement agreement and, in accordance with the terms and
conditions of that settlement, the monies were disbursed to the participating
funds. The Fund did not participate in the CAGO settlement. The SEC has not yet
approved the distribution plan pertaining to the SEC settlement. When approved,
disbursements of settlement monies under the SEC's settlement will be made
promptly in accordance with the terms and conditions of that order.

OTHER LEGAL PROCEEDINGS

On April 12, 2005, the Attorney General of West Virginia filed a complaint in
the Circuit Court of Marshall County, West Virginia against a number of
companies engaged in the mutual fund industry, including Franklin Resources,
Inc. and its subsidiary, Franklin Advisers, Inc., and certain other parties
alleging violations of the West Virginia Consumer Credit and Protection Act and
seeking, among other things, civil penalties and attorneys' fees and costs.
Defendants have since removed the matter to the United States District Court for
the Northern District of West

24 | Annual Report

TEMPLETON EMERGING MARKETS FUND

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

9. REGULATORY MATTERS (CONTINUED)

OTHER LEGAL PROCEEDINGS (CONTINUED)

Virginia. To the extent applicable to the Company, the complaint arises from
activity that occurred in 2001 and duplicates, in whole or in part, the
allegations asserted in the February 4, 2004 Massachusetts Administrative
Complaint concerning one instance of market timing (the "Administrative
Complaint") and the SEC's findings regarding market timing in its August 2, 2004
Order (the "SEC Order"), both of which matters were previously reported.

The Company, in addition to certain funds, and certain current and former
officers, employees, and directors have been named in multiple lawsuits in
different courts alleging violations of various federal securities and state
laws and seeking, among other relief, monetary damages, restitution, removal of
fund trustees, directors, advisers, administrators, and distributors, rescission
of management contracts and 12b-1 plans, and/or attorneys' fees and costs.
Specifically, the lawsuits claim breach of duty with respect to alleged
arrangements to permit market timing and/or late trading activity, or breach of
duty with respect to the valuation of the portfolio securities of certain
Templeton funds managed by Franklin Resources, Inc. subsidiaries, allegedly
resulting in market timing activity. The majority of these lawsuits duplicate,
in whole or in part, the allegations asserted in the Administrative Complaint
and the SEC's findings regarding market timing in the SEC Order. The lawsuits
are styled as class actions, or derivative actions on behalf of either the named
funds or Franklin Resources, Inc.

The Company, in addition to certain funds, and certain current and former
officers, employees, and directors have been named in multiple lawsuits alleging
violations of various securities laws and pendent state law claims relating to
the disclosure of marketing support payments and/or payment of allegedly
excessive commissions and/or advisory or distribution fees, and seeking, among
other relief, monetary damages, restitution, rescission of advisory contracts,
including recovery of all fees paid pursuant to those contracts, an accounting
of all monies paid to the named advisers, declaratory relief, injunctive relief,
and/or attorneys' fees and costs. These lawsuits are styled as class actions or
derivative actions brought on behalf of the named funds.

The Company and fund management strongly believe that the claims made in each of
the lawsuits described above are without merit and intend to defend against them
vigorously. The Company cannot predict with certainty the eventual outcome of
these lawsuits, nor whether they will have a material negative impact on the
Company. Public trust and confidence are critical to the Company's business and
any material loss of investor and/or client confidence could result in a
significant decline in assets under management by the Company, which would have
an adverse effect on future financial results. If it is determined that the
Company bears responsibility for any unlawful or inappropriate conduct that
caused losses to the Fund, it is committed to making the Fund or its
shareholders whole, as appropriate. The Company is committed to taking all
appropriate actions to protect the interests of its funds' shareholders.

Annual Report | 25

TEMPLETON EMERGING MARKETS FUND

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF TEMPLETON EMERGING MARKETS FUND

In our opinion, the accompanying statement of assets and liabilities, including
the statement of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Templeton Emerging Markets Fund
(the "Fund") at August 31, 2005, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended and the financial highlights for each of the five years in the period
then ended, in conformity with accounting principles generally accepted in the
United States of America. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at August
31, 2005 by correspondence with the custodian and brokers, provide a reasonable
basis for our opinion.

PricewaterhouseCoopers LLP

San Francisco, California
October 10, 2005

26 | Annual Report

TEMPLETON EMERGING MARKETS FUND

TAX DESIGNATION (UNAUDITED)

Under Section 852(b)(3)(C) of the Internal Revenue Code (Code), the Fund
designates the maximum amount allowable but no less than $24,329,151 as a
capital gain dividend for the fiscal year ended August 31, 2005.

Under Section 854(b)(2) of the Code the Fund designates up to a maximum of
$4,024,520 as qualified dividends for purposes of the maximum rate under Section
1(h)(11) of the Code for the fiscal year ended August 31, 2005. In January 2006,
shareholders will receive Form 1099-DIV which will include their share of
qualified dividends distributed during the calendar year 2005. Shareholders are
advised to check with their tax advisors for information on the treatment of
these amounts on their individual income tax returns.

At August 31, 2005 more than 50% of the Templeton Emerging Markets Fund's total
assets were invested in securities of foreign issuers. In most instances,
foreign taxes were withheld from dividends paid to the Fund on these
investments. As shown in the table below, the Fund designates to shareholders
the foreign source income and foreign taxes paid, pursuant to Section 853 of the
Code. This designation will allow shareholders of record on November 4, 2005, to
treat their proportionate share of foreign taxes paid by the Fund as having been
paid directly by them. The shareholder shall consider these amounts as foreign
taxes paid in the tax year in which they receive the Fund distribution.

The following table provides a detailed analysis, by country, of foreign tax
paid, foreign source income, and foreign qualified dividends as designated by
the Fund, to shareholders of record.

RECORD DATE: 11/04/2005

-------------------------------------------------------------------------------------------------
FOREIGN TAX FOREIGN FOREIGN
PAID SOURCE INCOME QUALIFIED DIVIDENDS
COUNTRY PER SHARE PER SHARE PER SHARE
-------------------------------------------------------------------------------------------------

Austria ................................. $0.0004 $0.0036 $0.0036
Belgium ................................. 0.0001 0.0013 0.0013
Brazil .................................. 0.0051 0.0504 0.0000
Canada .................................. 0.0000 0.0002 0.0002
China ................................... 0.0000 0.0229 0.0080
Croatia ................................. 0.0000 0.0024 0.0000
Greece .................................. 0.0000 0.0009 0.0009
Hong Kong ............................... 0.0000 0.0280 0.0000
Hungary ................................. 0.0004 0.0066 0.0066
India ................................... 0.0000 0.0079 0.0079
Indonesia ............................... 0.0000 0.0002 0.0002
Malaysia ................................ 0.0000 0.0042 0.0000
Mexico .................................. 0.0000 0.0148 0.0148
Panama .................................. 0.0000 0.0016 0.0016
Philippines ............................. 0.0003 0.0016 0.0016
Poland .................................. 0.0006 0.0059 0.0059
Russia .................................. 0.0005 0.0053 0.0037
Singapore ............................... 0.0000 0.0312 0.0000
South Africa ............................ 0.0011 0.0396 0.0078
South Korea ............................. 0.0052 0.0453 0.0453
Sweden .................................. 0.0000 0.0028 0.0000

Annual Report | 27

TEMPLETON EMERGING MARKETS FUND

TAX DESIGNATION (UNAUDITED) (CONTINUED)

-----------------------------------------------------------------------------------------------
FOREIGN TAX FOREIGN FOREIGN
PAID SOURCE INCOME QUALIFIED DIVIDENDS
COUNTRY PER SHARE PER SHARE PER SHARE
-----------------------------------------------------------------------------------------------

Taiwan .................................. 0.0235 0.0597 0.0000
Thailand ................................ 0.0004 0.0061 0.0061
Turkey .................................. 0.0000 0.0198 0.0198
United Kingdom .......................... 0.0000 0.0014 0.0000
------------------------------------------------
TOTAL ................................... $0.0376 $0.3637 $0.1353
================================================

Foreign Tax Paid per Share (Column 1) is the amount per share available to you,
as a tax credit or deduction (assuming you held your shares in the Fund for a
minimum of 16 days during the 30-day period beginning 15 days before the
ex-dividend date of the Fund's distribution to which the foreign taxes relate).

Foreign Source Income per Share (Column 2) is the amount per share of income
dividends paid to you that is attributable to foreign securities held by the
Fund, plus any foreign taxes withheld on these dividends. The amounts reported
include foreign source qualified dividends without adjustment for the lower U.S.
tax rates.

Foreign Qualified Dividends per Share (Column 3) is the amount per share of
foreign source qualified dividends the Fund paid to you, plus any foreign taxes
withheld on these dividends. These amounts represent the portion of the Foreign
Source Income reported to you in column 2 that were derived from qualified
foreign securities held by the Fund. If you have foreign source qualified
dividends, you may be required to make certain adjustments to those amounts
before taking them into account on line 1 of Form 1116. However, you may qualify
for an adjustment exception. Please see the instructions to Form 1116 for more
information.

In January 2006, shareholders will receive Form 1099-DIV which will include
their share of taxes paid and foreign source income distributed during the
calendar year 2005. The Foreign Source Income reported on Form 1099-DIV has not
been reduced to take into account the tax rate differential on foreign source
qualified dividend income. Shareholders are advised to check with their tax
advisors for information on the treatment of these amounts on their 2005
individual income tax returns.

28 | Annual Report

TEMPLETON EMERGING MARKETS FUND

ANNUAL MEETING OF SHAREHOLDERS, FEBRUARY 25, 2005

The Annual Meeting of Shareholders of the Fund was held at the Fund's offices,
500 E. Broward Blvd., Fort Lauderdale, Florida, on February 25, 2005. The
purpose of the meeting was to elect four Trustees of the Fund. At the meeting,
the following persons were elected by the shareholders to serve as Trustees of
the Fund: Harris J. Ashton, Frank J. Crothers, S. Joseph Fortunato and Edith E.
Holiday.* No other business was transacted at the meeting.

The results of the voting at the Annual Meeting are as follows:

The election of four (4) Trustees:

-------------------------------------------------------------------------------------------------------------------------
% OF % OF
SHARES SHARES
% OF PRESENT % OF PRESENT
OUTSTANDING AND OUTSTANDING AND
TERM EXPIRING 2008 FOR SHARES VOTING WITHHELD SHARES VOTING
-------------------------------------------------------------------------------------------------------------------------

Harris J. Ashton ............. 14,285,941.8329 80.75% 97.95% 298,801.7521 1.69% 2.05%
Frank J. Crothers ............ 14,447,401.8329 81.66% 99.06% 137,341.7521 0.78% 0.94%
S. Joseph Fortunato .......... 14,284,438.8329 80.74% 97.94% 300,304.7521 1.70% 2.06%
Edith E. Holiday ............. 14,299,253.8329 80.82% 98.04% 285,489.7521 1.61% 1.96%

* Harmon E. Burns, Charles B. Johnson, Gordon S. Macklin, Fred R. Millsaps,
Frank A. Olson and Constantine D. Tseretopoulos are Trustees of the Fund
who are currently serving and whose terms of office continued after the
Annual Meeting of Shareholders.

Annual Report | 29

TEMPLETON EMERGING MARKETS FUND

DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN

The Fund offers a Dividend Reinvestment and Cash Purchase Plan (the "Plan") with
the following features:

Shareholders must affirmatively elect to participate in the Plan; share
dividends and capital gains distributions will be reinvested automatically;
Mellon Investor Services, P.O. Box 3338, South Hackensack, NJ 07606-1938, will
provide additional Plan information upon request.

Whenever the Fund declares dividends in either cash or shares of the Fund, if
the market price is equal to or exceeds net asset value at the valuation date,
the participant will receive the dividends entirely in shares at a price equal
to the net asset value, but not less than 95% of the then current market price
of the Fund's shares. If the market price is lower than net asset value or if
dividends and/or capital gains distributions are payable only in cash, the
participant will receive shares purchased on the New York Stock Exchange or
otherwise on the open market.

A participant has the option of submitting additional cash payments to Mellon
Bank, N.A. (the "Plan Administrator"), in any amounts of at least $100, up to a
maximum of $5,000 per month, for the purchase of Fund shares for his or her
account. These payments shall be made by check or money order payable to "Mellon
Bank, N.A." and sent to Mellon Investor Services, P.O. Box 382009, Pittsburgh,
PA 15250-8009, Attention: Templeton Emerging Markets Fund. The Plan
Administrator shall apply such payments (less a $5.00 service charge and less a
pro rata share of trading fees) to purchases of Fund shares on the open market.

The automatic reinvestment of dividends and/or capital gains does not relieve
the participant of any income tax that may be payable on dividends or
distributions.

Whenever shares are purchased on the New York Stock Exchange or otherwise on the
open market, each participant will pay a pro rata portion of trading fees.
Trading fees will be deducted from amounts to be invested. The Plan Agent's fee
for a sale of shares through the Plan are $15.00 per transaction plus a $0.12
per share trading fee.

The participant may withdraw from the Plan without penalty at any time by
written notice to the Plan Administrator sent to Mellon Investor Services, P.O.
Box 3338, South Hackensack, NJ 07606-1938. Upon withdrawal, the participant will
receive, without charge, share certificates issued in the participant's name for
all full shares held by the Plan Administrator; or, if the participant wishes,
the Plan Administrator will sell the shares and send the proceeds to the
participant, less a service charge of $15.00 and less trading fees of $0.12 per
share.

30 | Annual Report

TEMPLETON EMERGING MARKETS FUND

TRANSFER AGENT
Mellon Investor Services LLC
480 Washington Boulevard
Jersey City, NJ 07310
1-800-416-5585
www.melloninvestor.com

SHAREHOLDER INFORMATION

Shares of Templeton Emerging Markets Fund are traded on the New York Stock
Exchange under the symbol "EMF." The Fund's shares are also listed and traded on
the Pacific Exchange. Information about the net asset value and the market price
is published each Monday in the WALL STREET JOURNAL, weekly in BARRON'S and each
Saturday in THE NEW YORK TIMES and other newspapers. Daily market prices for the
Fund's shares are published in the "New York Stock Exchange Composite
Transactions" section of newspapers.

For current information about dividends and shareholder accounts, call
1-800-416-5585. Registered shareholders can access their Fund account on-line
with Investor ServiceDirect(R). For information go to Mellon Investor Services'
web site at https://vault.melloninvestor.com/isd and follow the instructions.

The daily closing net asset value as of the previous business day may be
obtained when available by calling Franklin Templeton Fund Information after 7
a.m. Pacific time any business day at 1-800/DIAL BEN(R) (1-800/342-5236). The
Fund's net asset value and dividends are also listed on the NASDAQ Stock Market,
Inc.'s Mutual Fund Quotation Service ("NASDAQ MFQS").

Shareholders not receiving copies of reports to shareholders because their
shares are registered in the name of a broker or a custodian can request that
they be added to the Fund's mailing list, by writing Templeton Emerging Markets
Fund, 100 Fountain Parkway, P.O. Box 33030, St. Petersburg, FL 33733-8030.

Annual Report | 31

TEMPLETON EMERGING MARKETS FUND

BOARD MEMBERS AND OFFICERS

The name, year of birth and address of the officers and board members, as well
as their affiliations, positions held with the Fund, principal occupations
during the past five years and number of U.S. registered portfolios overseen in
the Franklin Templeton Investments fund complex are shown below. Generally, each
board member serves a three-year term that continues until that person's
successor is elected and qualified.

INDEPENDENT BOARD MEMBERS

------------------------------------------------------------------------------------------------------------------------------------
NUMBER OF PORTFOLIOS IN
NAME, YEAR OF BIRTH LENGTH OF FUND COMPLEX OVERSEEN
AND ADDRESS POSITION TIME SERVED BY BOARD MEMBER* OTHER DIRECTORSHIPS HELD
------------------------------------------------------------------------------------------------------------------------------------

HARRIS J. ASHTON (1932) Trustee Since 1992 141 Director, Bar-S Foods (meat
500 East Broward Blvd. packing company).
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director of various companies; and FORMERLY, Director, RBC Holdings, Inc. (bank holding company) (until 2002); and President, Chief
Executive Officer and Chairman of the Board, General Host Corporation (nursery and craft centers) (until 1998).
------------------------------------------------------------------------------------------------------------------------------------
FRANK J. CROTHERS (1944) Trustee Since 1999 20 None
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman, Island Corporate Holding Ltd.; Director and Vice Chairman, Caribbean Utilities Co. Limited; Director, Provo Power Company
Ltd.; director of various other business and nonprofit organizations; and FORMERLY, Chairman, Atlantic Equipment & Power Ltd.
(1977-2003).
------------------------------------------------------------------------------------------------------------------------------------
S. JOSEPH FORTUNATO (1932) Trustee Since 1992 142 None
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Attorney; and FORMERLY, member of the law firm of Pitney, Hardin, Kipp & Szuch (until 2002) (Consultant (2003)).
------------------------------------------------------------------------------------------------------------------------------------
EDITH E. HOLIDAY (1952) Trustee Since 1996 137 Director, Amerada Hess
500 East Broward Blvd. Corporation (exploration and
Suite 2100 refining of oil and gas), H.J.
Fort Lauderdale, FL 33394-3091 Heinz Company (processed foods
and allied products), RTI
International Metals, Inc.
(manufacture and distribution
of titanium), Canadian
National Railway (railroad),
and White Mountains Insurance
Group, Ltd. (holding company).
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director or Trustee of various companies and trusts; and FORMERLY, Assistant to the President of the United States and Secretary of
the Cabinet (1990-1993); General Counsel to the United States Treasury Department (1989-1990); and Counselor to the Secretary and
Assistant Secretary for Public Affairs and Public Liaison-United States Treasury Department (1988-1989).
------------------------------------------------------------------------------------------------------------------------------------

32 | Annual Report

GORDON S. MACKLIN (1928) Trustee Since 1993 141 Director, Martek Biosciences
500 East Broward Blvd. Corporation, MedImmune, Inc.
Suite 2100 (biotechnology), and
Fort Lauderdale, FL 33394-3091 Overstock.com (Internet
services); and FORMERLY,
Director, MCI Communication
Corporation (subsequently
known as MCI WorldCom, Inc.
and WorldCom, Inc.)
(communications services)
(1988-2002), White Mountains
Insurance Group, Ltd. (holding
company) (1987-2004) and
Spacehab, Inc. (aerospace
services) (1994-2003).
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director of various companies; and FORMERLY, Deputy Chairman, White Mountains Insurance Group, Ltd. (holding company) (2001-2004);
Chairman, White River Corporation (financial services) (1993-1998) and Hambrecht & Quist Group (investment banking) (1987-1992); and
President, National Association of Securities Dealers, Inc. (1970-1987).
------------------------------------------------------------------------------------------------------------------------------------
FRED R. MILLSAPS (1929) Trustee Since 1990 27 None
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director of various business and nonprofit organizations; manager of personal investments (1978-present); and FORMERLY, Chairman and
Chief Executive Officer, Landmark Banking Corporation (1969-1978); Financial Vice President, Florida Power and Light (1965-1969);
and Vice President, Federal Reserve Bank of Atlanta (1958-1965).
------------------------------------------------------------------------------------------------------------------------------------
FRANK A. OLSON (1932) Trustee Since 2003 101 Director, White Mountains
500 East Broward Blvd. Insurance Group, Ltd. (holding
Suite 2100 company), Amerada Hess
Fort Lauderdale, FL 33394-3091 Corporation (exploration and
refining of oil and gas) and
Sentient Jet (private jet
service); and FORMERLY,
Director, Becton Dickinson and
Company (medical technology),
Cooper Industries, Inc.
(electrical products and tools
and hardware), Health Net,
Inc. (formerly, Foundation
Health) (integrated managed
care), The Hertz Corporation,
Pacific Southwest Airlines,
The RCA Corporation, Unicom
(formerly, Commonwealth
Edison) and UAL Corporation
(airlines).
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman Emeritus, The Hertz Corporation (car rental) (since 2000) (Chairman of the Board (1980-2000) and Chief Executive Officer
(1977-1999)); and FORMERLY, Chairman of the Board, President and Chief Executive Officer, UAL Corporation (airlines).
------------------------------------------------------------------------------------------------------------------------------------

Annual Report | 33

CONSTANTINE D. TSERETOPOULOS Trustee Since 1999 20 None
(1954)
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Physician, Lyford Cay Hospital (1987-present); and director of various nonprofit organizations; and FORMERLY, Cardiology Fellow,
University of Maryland (1985-1987) and Internal Medicine Resident, Greater Baltimore Medical Center (1982-1985).
------------------------------------------------------------------------------------------------------------------------------------

INTERESTED BOARD MEMBERS AND OFFICERS

**HARMON E. BURNS (1945) Trustee and Trustee since 21 None
One Franklin Parkway Vice President 1992 and
San Mateo, CA 94403-1906 Vice President
since 1996
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice Chairman, Member - Office of the Chairman and Director, Franklin Resources, Inc.; Vice President and Director, Franklin
Templeton Distributors, Inc.; Executive Vice President, Franklin Advisers, Inc.; and officer and/or director or trustee, as the case
may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 46 of the investment companies in Franklin Templeton
Investments.
------------------------------------------------------------------------------------------------------------------------------------
**CHARLES B. JOHNSON (1933) Trustee, Trustee and 141 None
One Franklin Parkway Chairman of Chairman of the
San Mateo, CA 94403-1906 the Board and Board since 1995
Vice President and Vice
President since
1992
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman of the Board, Member - Office of the Chairman and Director, Franklin Resources, Inc.; Vice President, Franklin Templeton
Distributors, Inc.; Director, Fiduciary Trust Company International; and officer and/or director or trustee, as the case may be, of
some of the other subsidiaries of Franklin Resources, Inc. and of 43 of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
JAMES M. DAVIS (1952) Chief Since 2004 Not Applicable Not Applicable
One Franklin Parkway Compliance
San Mateo, CA 94403-1906 Officer
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director, Global Compliance, Franklin Resources, Inc.; officer of 48 of the investment companies in Franklin Templeton Investments;
and FORMERLY, Director of Compliance, Franklin Resources, Inc. (1994-2001).
------------------------------------------------------------------------------------------------------------------------------------
JEFFERY A. EVERETT (1964) Vice President Since 2001 Not Applicable Not Applicable
PO Box N-7759
Lyford Cay, Nassau, Bahamas
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
President and Director, Templeton Global Advisors Limited; officer of 14 of the investment companies in Franklin Templeton
Investments.
------------------------------------------------------------------------------------------------------------------------------------

34 | Annual Report

JIMMY D. GAMBILL (1947) Senior Vice Since 2002 Not Applicable Not Applicable
500 East Broward Blvd. President and
Suite 2100 Chief Executive
Fort Lauderdale, FL 33394-3091 Officer -
Finance and
Administration
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
President, Franklin Templeton Services, LLC; Senior Vice President, Templeton Worldwide, Inc.; and officer of 48 of the investment
companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
DAVID P. GOSS (1947) Vice President Since 2000 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Senior Associate General Counsel, Franklin Resources, Inc.; officer and director of one of the subsidiaries of Franklin Resources,
Inc.; officer of 48 of the investment companies in Franklin Templeton Investments; and FORMERLY, President, Chief Executive Officer
and Director, Property Resources Equity Trust (until 1999) and Franklin Select Realty Trust (until 2000).
------------------------------------------------------------------------------------------------------------------------------------
BARBARA J. GREEN (1947) Vice President Since 2000 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice President, Deputy General Counsel and Secretary, Franklin Resources, Inc.; Secretary and Senior Vice President, Templeton
Worldwide, Inc.; Secretary, Franklin Advisers, Inc., Franklin Advisory Services, LLC, Franklin Investment Advisory Services, LLC,
Franklin Mutual Advisers, LLC, Franklin Templeton Alternative Strategies, Inc., Franklin Templeton Investor Services, LLC, Franklin
Templeton Services, LLC, Franklin Templeton Distributors, Inc., Templeton Investment Counsel, LLC, and Templeton/Franklin Investment
Services, Inc.; and officer of some of the other subsidiaries of Franklin Resources, Inc. and of 48 of the investment companies in
Franklin Templeton Investments; and FORMERLY, Deputy Director, Division of Investment Management, Executive Assistant and Senior
Advisor to the Chairman, Counselor to the Chairman, Special Counsel and Attorney Fellow, U.S. Securities and Exchange Commission
(1986-1995); Attorney, Rogers & Wells (until 1986); and Judicial Clerk, U.S. District Court (District of Massachusetts) (until
1979).
------------------------------------------------------------------------------------------------------------------------------------
RUPERT H. JOHNSON, JR. (1940) Vice President Since 1996 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice Chairman, Member - Office of the Chairman and Director, Franklin Resources, Inc.; Vice President and Director, Franklin
Templeton Distributors, Inc.; Director, Franklin Advisers, Inc.; Senior Vice President, Franklin Advisory Services, LLC; and officer
and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 46 of the
investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
JOHN R. KAY (1940) Vice President Since 1994 Not Applicable Not Applicable
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice President, Templeton Worldwide, Inc.; Assistant Vice President, Franklin Templeton Distributors, Inc.; Senior Vice President,
Franklin Templeton Services, LLC; and officer of some of the other subsidiaries of Franklin Resources, Inc. and of 32 of the
investment companies in Franklin Templeton Investments; and FORMERLY, Vice President and Controller, Keystone Group, Inc.
------------------------------------------------------------------------------------------------------------------------------------

Annual Report | 35

MICHAEL O. MAGDOL (1937) Vice President - Since 2002 Not Applicable Not Applicable
600 Fifth Avenue AML
Rockefeller Center Compliance
New York, NY 10020-2302
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice Chairman, Chief Banking Officer and Director, Fiduciary Trust Company International; Director, Franklin Templeton Institutional
Suisse SA, Arch Chemicals, Inc. and Lingnan Foundation; and officer and/or director, as the case may be, of some of the other
subsidiaries of Franklin Resources, Inc. and of 46 of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
MARK MOBIUS (1936) Officer - and Chief Not Applicable Not Applicable
17th Floor, The Chater House Investment Executive Officer -
8 Connaught Road Management Investment
Central Hong Kong President Management
President and Chief Executive since 1987 since 2002
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Portfolio Manager of various Templeton advisory affiliates; Managing Director, Templeton Asset Management Ltd.; Executive Vice
President and Director, Templeton Global Advisors Limited; and officer and/or director, as the case may be, of some of the
subsidiaries of Franklin Resources, Inc. and of six of the investment companies in Franklin Templeton Investments; and FORMERLY,
President, International Investment Trust Company Limited (investment manager of Taiwan R.O.C. Fund) (1986-1987); and Director,
Vickers da Costa, Hong Kong (1983-1986).
------------------------------------------------------------------------------------------------------------------------------------
ROBERT C. ROSSELOT (1960) Secretary Since Not Applicable Not Applicable
500 East Broward Blvd. December 2004
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Associate General Counsel and Assistant Secretary, Franklin Resources, Inc.; Vice President and Assistant Secretary, Templeton
Investment Counsel, LLC and Fiduciary Trust International of the South; and officer of 14 of the investment companies in Franklin
Templeton Investments; and FORMERLY, Assistant General Counsel, The Prudential Insurance Company of America.
------------------------------------------------------------------------------------------------------------------------------------
GREGORY R. SEWARD (1956) Treasurer Since 2004 Not Applicable Not Applicable
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice President, Franklin Templeton Services, LLC; officer of 14 of the investment companies in Franklin Templeton Investments; and
FORMERLY, Vice President, JPMorgan Chase (2000-2004) and American General Financial Group (1991-2000).
------------------------------------------------------------------------------------------------------------------------------------
MURRAY L. SIMPSON (1937) Vice President Since 2000 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Executive Vice President, Franklin Resources, Inc.; officer and/or director, as the case may be, of some of the subsidiaries of
Franklin Resources, Inc. and of 48 of the investment companies in Franklin Templeton Investments; and FORMERLY, Chief Executive
Officer and Managing Director, Templeton Franklin Investment Services (Asia) Limited (until 2000); and Director, Templeton Asset
Management Ltd. (until 1999).
------------------------------------------------------------------------------------------------------------------------------------

36 | Annual Report

GALEN G. VETTER (1951) Chief Financial Since 2004 Not Applicable Not Applicable
500 East Broward Blvd. Officer and
Suite 2100 Chief
Fort Lauderdale, FL 33394-3091 Accounting
Officer
------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Senior Vice President, Franklin Templeton Services, LLC; officer of 48 of the investment companies in Franklin Templeton
Investments; and FORMERLY, Managing Director, RSM McGladrey, Inc. (1999-2004); and Partner, McGladrey & Pullen, LLP (1979-1987) and
1991-2004).
------------------------------------------------------------------------------------------------------------------------------------

* We base the number of portfolios on each separate series of the registered
investment companies comprising the Franklin Templeton Investments fund
complex. These portfolios have a common investment adviser or affiliated
investment advisers.

** Charles B. Johnson is considered an interested person of the Trust under
the federal securities laws due to his position as an officer and director
and major shareholder of Franklin Resources, Inc. (Resources), which is
the parent company of the Trust's adviser. Harmon E. Burns is considered
an interested person of the Trust under the federal securities laws due to
his position as officer and director of Resources.

Note: Charles B. Johnson and Rupert H. Johnson, Jr. are brothers.

THE SARBANES-OXLEY ACT OF 2002 AND RULES ADOPTED BY THE U.S. SECURITIES AND
EXCHANGE COMMISSION REQUIRE THE FUND TO DISCLOSE WHETHER THE FUND'S AUDIT
COMMITTEE INCLUDES AT LEAST ONE MEMBER WHO IS AN AUDIT COMMITTEE FINANCIAL
EXPERT WITHIN THE MEANING OF SUCH ACT AND RULES. THE FUND'S BOARD OF TRUSTEES
HAS DETERMINED THAT THERE IS AT LEAST ONE SUCH FINANCIAL EXPERT ON THE AUDIT
COMMITTEE AND HAS DESIGNATED EACH OF FRED R. MILLSAPS AND FRANK A. OLSON AS AN
AUDIT COMMITTEE FINANCIAL EXPERT. THE BOARD BELIEVES THAT MESSRS. MILLSAPS AND
OLSON QUALIFY AS SUCH AN EXPERT IN VIEW OF THEIR EXTENSIVE BUSINESS BACKGROUND
AND EXPERIENCE. MR. MILLSAPS, WHO IS CURRENTLY A DIRECTOR OF VARIOUS BUSINESS
AND NONPROFIT ORGANIZATIONS, HAS SERVED AS A MEMBER AND CHAIRMAN OF THE FUND
AUDIT COMMITTEE SINCE 1991 AND WAS FORMERLY CHAIRMAN AND CHIEF EXECUTIVE OFFICER
OF LANDMARK BANKING CORPORATION AND FINANCIAL VICE PRESIDENT OF FLORIDA POWER
AND LIGHT. MR. OLSON, WHO HAS SERVED AS A MEMBER OF THE FUND AUDIT COMMITTEE
SINCE 2003, CURRENTLY SERVES AS CHAIRMAN EMERITUS OF THE HERTZ CORPORATION AND
WAS FORMERLY CHAIRMAN FROM 1980-2000 AND ITS CHIEF EXECUTIVE OFFICER FROM 1977
TO 1999, IS A DIRECTOR AND AUDIT COMMITTEE MEMBER OF AMERADA HESS CORPORATION
AND WHITE MOUNTAINS INSURANCE GROUP, LTD., AND A FORMER CHAIRMAN, PRESIDENT AND
CHIEF EXECUTIVE OFFICER OF UAL CORPORATION. AS A RESULT OF SUCH BACKGROUND AND
EXPERIENCE, THE BOARD OF TRUSTEES BELIEVES THAT MR. MILLSAPS AND MR. OLSON HAVE
EACH ACQUIRED AN UNDERSTANDING OF GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND
FINANCIAL STATEMENTS, THE GENERAL APPLICATION OF SUCH PRINCIPLES IN CONNECTION
WITH THE ACCOUNTING ESTIMATES, ACCRUALS AND RESERVES, AND ANALYZING AND
EVALUATING FINANCIAL STATEMENTS THAT PRESENT A BREADTH AND LEVEL OF COMPLEXITY
OF ACCOUNTING ISSUES GENERALLY COMPARABLE TO THOSE OF THE FUND, AS WELL AS AN
UNDERSTANDING OF INTERNAL CONTROLS AND PROCEDURES FOR FINANCIAL REPORTING AND AN
UNDERSTANDING OF AUDIT COMMITTEE FUNCTIONS. MESSRS. MILLSAPS AND OLSON ARE
INDEPENDENT TRUSTEES AS THAT TERM IS DEFINED UNDER THE APPLICABLE STOCK EXCHANGE
RULES AND U.S. SECURITIES AND EXCHANGE COMMISSION RULES AND RELEASES.

Annual Report | 37

TEMPLETON EMERGING MARKETS FUND

SHAREHOLDER INFORMATION

BOARD REVIEW OF INVESTMENT ADVISORY CONTRACT

At a meeting held May 11, 2005, the Board of Trustees ("Board"), including a
majority of non-interested or independent Trustees, approved renewal of the
investment advisory contract for the Fund. In reaching this decision, the Board
took into account information furnished throughout the year at regular Board
meetings, as well as information prepared specifically in connection with the
annual renewal review process. Information furnished and discussed throughout
the year included reports on the Fund, the share price premium or discount to
net asset value, the results of investment performance and related financial
information for the Fund, as well as periodic reports on legal, compliance,
pricing, brokerage commissions and execution and other services provided by the
Investment Manager ("Manager") and its affiliates. Information furnished
specifically in connection with the renewal process included a report prepared
by Lipper Financial Services ("Lipper"), an independent organization, as well as
a Fund profitability analysis report prepared by management. The Lipper report
compared the Fund's investment performance and expenses with those of other
funds deemed comparable to the Fund as selected by Lipper. The Fund
profitability analysis report discussed the profitability to Franklin Templeton
Investments from its overall U.S. fund operations, as well as on an individual
fund-by-fund basis. Included with such profitability analysis report was
information on a fund-by-fund basis listing portfolio managers and other
accounts they manage, as well as information on management fees charged by the
Manager including management's explanation of differences where relevant, and a
three-year expense analysis with an explanation for any increase in expense
ratios. Additional information accompanying such report was a memorandum
prepared by management describing enhancements to the services provided to the
Fund by the Franklin Templeton Investments organization, as well as a memorandum
relating to economies of scale.

In considering such materials, the independent Trustees received assistance and
advice from and met separately with independent counsel. In approving
continuance of the investment advisory contract for the Fund, the Board,
including a majority of independent Trustees, determined that the existing
management fee structure was fair and reasonable and that continuance of the
investment advisory contract was in the best interests of the Fund and its
shareholders. While attention was given to all information furnished, the
following discusses the primary factors relevant to the Board's decision.

NATURE, EXTENT AND QUALITY OF SERVICE. The Board was satisfied with the nature
and quality of the overall services provided by the Manager and its affiliates
to the Fund and its shareholders. In addition to investment performance and
expenses discussed later, the Board's opinion was based, in part, upon periodic
reports furnished them showing that the investment policies and restrictions for
the Fund were consistently complied with as well as other reports periodically
furnished the Board covering matters such as the compliance of portfolio
managers and other management personnel with the code of ethics adopted
throughout the Franklin Templeton fund complex, the adherence to fair value
pricing procedures established by the Board, and the accuracy of net asset value
calculations. Favorable consideration was given to management's efforts and
expenditures in establishing back-up systems and recovery procedures

38 | Annual Report

TEMPLETON EMERGING MARKETS FUND

SHAREHOLDER INFORMATION (CONTINUED)

BOARD REVIEW OF INVESTMENT ADVISORY CONTRACT (CONTINUED)

to function in the event of a natural disaster, it being noted by the Board that
such systems and procedures had functioned smoothly during the hurricanes and
blackout experienced last year in Florida. Other factors taken into account by
the Board were the Manager's best execution trading policies, as well as the
compliance procedures and qualifications of the Chief Compliance Officer
established in accordance with recently adopted SEC requirements. Consideration
was also given to the experience of the Fund's portfolio management team, the
number of accounts managed and general method of compensation. In this latter
respect, the Board noted that a primary factor in management's determination of
the level of a portfolio manager's bonus compensation was the relative
investment performance of the funds he or she managed so as to be aligned with
the interests of Fund shareholders.

INVESTMENT PERFORMANCE. The Board placed significant emphasis on the investment
performance of the Fund in view of its importance to shareholders. While
consideration was given to performance reports and discussions with portfolio
managers at Board meetings during the year, particular attention in assessing
performance was given to the Lipper reports furnished for the contract renewals.
The Lipper report for the Fund showed its investment performance for the
one-year period ended February 28, 2005, as well as the previous ten years ended
that date in comparison to a Lipper performance universe consisting of the Fund
and all retail and institutional emerging market funds as selected by Lipper.
Such report considers total return on a fund net asset basis without regard to
market discounts or premiums in order to accurately reflect investment
performance. The Lipper report showed the Fund's total return for the one-year
period to be in the second highest quintile of such performance universe, and on
an annualized basis to be in the highest quintile of such universe for each of
the previous three- and ten-year periods and the second highest quintile of such
universe for the previous five-year period. The Board was satisfied with such
performance.

COMPARATIVE EXPENSES. Consideration was given to a comparative analysis of the
management fee and total expense ratios of the Fund compared with a Lipper
selected expense group consisting of the Fund and the two other closed-end
emerging markets funds. Prior to making such comparison, the Board relied upon a
survey showing that the scope of management advisory services covered under the
Fund's investment advisory contract was similar to those provided by fund
managers to other mutual fund groups that would be used as a basis of comparison
in the Lipper reports. In reviewing comparative costs, emphasis was given to the
Fund's management fee in comparison with the effective management fee that would
have been charged by the other two funds within the Lipper expense group
assuming they were the same size as the Fund, as well as the actual total
expenses of the Fund in comparison with those of the other two funds. The Lipper
effective management fee analysis considers administrative fees to be part of
management fees and the results of such expense comparison showed the Fund's
effective management fee rate to be the highest of such expense group, while its
total actual expenses were the lowest in such group. The Board found the Fund's
management fee and expenses in comparison to those of the expense group to be
acceptable.

Annual Report | 39

TEMPLETON EMERGING MARKETS FUND

SHAREHOLDER INFORMATION (CONTINUED)

BOARD REVIEW OF INVESTMENT ADVISORY CONTRACT (CONTINUED)

MANAGEMENT PROFITABILITY. The Board also considered the level of profits
realized by the Manager and its affiliates in connection with the operation of
the Fund. In this respect, the Board reviewed the Fund profitability analysis
that addresses the overall profitability of Franklin Templeton's U.S. fund
business, as well as its profits in providing management and other services to
the Fund. The Board also considered the extent to which the Manager and its
affiliates might derive ancillary benefits from fund operations, as well as
potential benefits resulting from allocation of fund brokerage and the use of
"soft" commission dollars to pay for research. Specific attention was given to
the methodology followed in allocating costs to the Fund, it being recognized
that allocation methodologies are inherently subjective and various allocation
methodologies may each be reasonable while producing different results. In this
respect, the Board noted that the cost allocation methodology was consistent
with that followed in profitability report presentations made in prior years and
that it had engaged on a biennial basis the Fund's independent accountants to
perform certain procedures specified by the Board solely for its purpose and
use. It was also noted that legal costs and payments incurred by Franklin
Templeton in resolving various legal proceedings arising from its U.S. fund
operations had not been allocated to the Fund for purposes of determining
profitability. Included in the analysis were the revenue and related costs
involved in managing the Fund, as well as its relative contribution to the
profitability of the Manager's parent. In reviewing and discussing such
analysis, management discussed with the Board its belief that costs incurred in
establishing the infrastructure necessary to the type of fund operations
conducted by the Manager and its corporate affiliates may not be fully reflected
in the expenses allocated to the Fund in determining its profitability, as well
as the fact that the level of profits, to a certain extent, reflected
operational cost savings and efficiencies initiated by management. In addition,
the Board considered a third-party study comparing the profitability of the
Manager's parent on an overall basis as compared to other publicly held managers
broken down to show profitability from management operations exclusive of
distribution expenses, as well as profitability including distribution expenses.
Based upon their consideration of all these factors, the Board determined that
the level of profits realized by the Manager under its investment advisory
contract with the Fund was not excessive in view of the nature, quality and
extent of services provided.

ECONOMIES OF SCALE. The Board also considered whether the Manager realizes
economies of scale as the Fund grows larger and the extent to which any such
benefit is shared with the Fund and its shareholders. The Board believed that a
manager's ability to realize economies of scale and the sharing of such benefit
is a more relevant consideration in the case of an open-end fund whose size
increases as a result of the continuous sale of its shares. A closed-end
investment company such as the Fund does not continuously offer shares and
growth following its initial public offering will primarily result from market
appreciation, which benefits its shareholders. While believing economies of
scale to be less of a factor in the context of a closed-end fund, the Board
believes at some point an increase in size may lead to economies of scale which
should be shared with the Fund and its shareholders and intends to monitor
future growth of the Fund accordingly. The Board also noted that in the previous
year it had added a breakpoint to the Fund's investment advisory fee at the $1
billion level.

40 | Annual Report

TEMPLETON EMERGING MARKETS FUND

SHAREHOLDER INFORMATION (CONTINUED)

PROXY VOTING POLICIES AND PROCEDURES

The Fund has established Proxy Voting Policies and Procedures ("Policies") that
the Fund uses to determine how to vote proxies relating to portfolio securities.
Shareholders may view the Fund's complete Policies online at
franklintempleton.com. Alternatively, shareholders may request copies of the
Policies free of charge by calling the Proxy Group collect at 1-954/847-2268 or
by sending a written request to: Franklin Templeton Companies, LLC, 500 East
Broward Boulevard, Suite 1500, Fort Lauderdale, FL 33394, Attention: Proxy
Group. Copies of the Fund's proxy voting records are also made available online
at franklintempleton.com and posted on the U.S. Securities and Exchange
Commission's website at sec.gov and reflect the most recent 12-month period
ended June 30.

QUARTERLY STATEMENT OF INVESTMENTS

The Fund files a complete statement of investments with the U.S. Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
website at sec.gov. The filed form may also be viewed and copied at the
Commission's Public Reference Room in Washington, DC. Information regarding the
operations of the Public Reference Room may be obtained by calling
1-800/SEC-0330.

CERTIFICATIONS

The Fund's Chief Executive Officer - Finance and Administration is required by
the New York Stock Exchange's Listing Standards to file annually with the
Exchange a certification that he is not aware of any violation by the Fund of
the Exchange's Corporate Governance Standards applicable to the Fund. The Fund
has filed such certification.

In addition, the Fund's Chief Executive Officer - Finance and Administration and
Chief Financial Officer and Chief Accounting Officer are required by the rules
of the U.S. Securities and Exchange Commission to provide certain certifications
with respect to the Fund's Form N-CSR and Form N-CSRS (which include the Fund's
annual and semiannual reports to shareholders) that are filed semiannually with
the Commission. The Fund has filed such certifications with its Form N-CSRS for
the six months ended February 28, 2005. Additionally, the Fund expects to file,
on or about October 31, 2005, such certifications with its Form N-CSR for the
year ended August 31, 2005.

Annual Report | 41

This page intentionally left blank.

LITERATURE REQUEST

LITERATURE REQUEST. TO RECEIVE A BROCHURE AND PROSPECTUS, PLEASE CALL US AT
1-800/DIAL BEN(R) (1-800/342-5236) OR VISIT FRANKLINTEMPLETON.COM. INVESTORS
SHOULD CAREFULLY CONSIDER A FUND'S INVESTMENT GOALS, RISKS, CHARGES AND EXPENSES
BEFORE INVESTING. THE PROSPECTUS CONTAINS THIS AND OTHER INFORMATION. PLEASE
CAREFULLY READ THE PROSPECTUS BEFORE INVESTING. To ensure the highest quality of
service, we may monitor, record and access telephone calls to or from our
service departments. These calls can be identified by the presence of a regular
beeping tone.

FRANKLIN TEMPLETON INVESTMENTS

INTERNATIONAL

Mutual European Fund
Templeton China World Fund
Templeton Developing Markets Trust
Templeton Foreign Fund
Templeton Foreign Smaller Companies Fund
Templeton International (Ex EM) Fund

GLOBAL

Mutual Discovery Fund
Templeton Global Long-Short Fund
Templeton Global Opportunities Trust
Templeton Global Smaller Companies Fund
Templeton Growth Fund
Templeton World Fund

GROWTH

Franklin Aggressive Growth Fund
Franklin Capital Growth Fund
Franklin Flex Cap Growth Fund
Franklin Small-Mid Cap Growth Fund
Franklin Small Cap Growth Fund II(1)

VALUE

Franklin Balance Sheet Investment Fund(2)
Franklin Equity Income Fund
Franklin Large Cap Value Fund
Franklin MicroCap Value Fund(2)
Franklin MidCap Value Fund
Franklin Small Cap Value Fund
Mutual Beacon Fund
Mutual Qualified Fund
Mutual Recovery Fund(3)
Mutual Shares Fund

BLEND

Franklin Blue Chip Fund
Franklin Convertible Securities Fund
Franklin Growth Fund
Franklin Rising Dividends Fund
Franklin U.S. Long-Short Fund

SECTOR

Franklin Biotechnology Discovery Fund
Franklin DynaTech Fund
Franklin Global Communications Fund
Franklin Global Health Care Fund
Franklin Gold and Precious Metals Fund
Franklin Natural Resources Fund
Franklin Real Estate Securities Fund
Franklin Technology Fund
Franklin Utilities Fund
Mutual Financial Services Fund

ASSET ALLOCATION

Franklin Templeton Corefolio Allocation Fund
Franklin Templeton Founding Funds Allocation Fund
Franklin Templeton Perspectives Allocation Fund

TARGET FUNDS

Franklin Templeton Conservative Target Fund
Franklin Templeton Growth Target Fund
Franklin Templeton Moderate Target Fund

INCOME

Franklin Adjustable U.S. Government Securities Fund(4)
Franklin's AGE High Income Fund
Franklin Floating Rate Daily Access Fund
Franklin Income Fund
Franklin Limited Maturity U.S. Government Securities Fund(4)
Franklin Low Duration Total Return Fund
Franklin Real Return Fund
Franklin Strategic Income Fund
Franklin Strategic Mortgage Portfolio
Franklin Templeton Hard Currency Fund
Franklin Total Return Fund
Franklin U.S. Government Securities Fund(4)
Templeton Global Bond Fund
Templeton Income Fund

TAX-FREE INCOME(5)

NATIONAL FUNDS

Double Tax-Free Income Fund
Federal Tax-Free Income Fund
High Yield Tax-Free Income Fund
Insured Tax-Free Income Fund(6)

LIMITED-TERM FUNDS

California Limited-Term Tax-Free Income Fund
Federal Limited-Term Tax-Free Income Fund
New York Limited-Term Tax-Free Income Fund

INTERMEDIATE-TERM FUNDS

California Intermediate-Term Tax-Free Income Fund
Federal Intermediate-Term Tax-Free Income Fund
New York Intermediate-Term Tax-Free Income Fund

STATE-SPECIFIC

Alabama
Arizona
California(7)
Colorado
Connecticut
Florida(7)
Georgia
Kentucky
Louisiana
Maryland
Massachusetts(6)
Michigan(6)
Minnesota(6)
Missouri
New Jersey
New York(7)
North Carolina
Ohio(7)
Oregon
Pennsylvania
Tennessee
Virginia

INSURANCE FUNDS

Franklin Templeton Variable Insurance Products Trust(8)

(1) The fund is closed to new investors. Existing shareholders can continue
adding to their accounts.

(2) The fund is only open to existing shareholders and select retirement
plans.

(3) The fund is a continuously offered, closed-end fund. Shares may be
purchased daily; there is no daily redemption. However, each quarter,
pending board approval, the fund will authorize the repurchase of 5%-25%
of the outstanding number of shares. Investors may tender all or a portion
of their shares during the tender period.

(4) An investment in the fund is neither insured nor guaranteed by the U.S.
government or by any other entity or institution.

(5) For investors subject to the alternative minimum tax, a small portion of
fund dividends may be taxable. Distributions of capital gains are
generally taxable.

(6) Portfolio of insured municipal securities.

(7) These funds are available in two or more variations, including long-term
portfolios, portfolios of insured securities, a high-yield portfolio (CA)
and limited-term, intermediate-term and money market portfolios (CA and
NY).

(8) The funds of the Franklin Templeton Variable Insurance Products Trust are
generally available only through insurance company variable contracts.

09/05 Not part of the annual report

[LOGO](R)
FRANKLIN(R) TEMPLETON(R) 100 Fountain Parkway
INVESTMENTS P.O. Box 33030
St. Petersburg, FL 33733-8030

ANNUAL REPORT

TEMPLETON EMERGING
MARKETS FUND

INVESTMENT MANAGER

Templeton Asset Management Ltd.

TRANSFER AGENT

Mellon Investor Services LLC
P.O. Box 3315
South Hackensack, NJ 07606-1915
Toll free number: 1-800/416-5585
Hearing Impaired phone number: 1-800/231-5469
Foreign Shareholders phone number: 201/680 -6578
www.melloninvestor.com

FUND INFORMATION

1-800/342 -5236

Investors should be aware that the value of investments made for the Fund may go
down as well as up. Like any investment in securities, the value of the Fund's
portfolio will be subject to the risk of loss from market, currency, economic,
political and other factors. The Fund and its investors are not protected from
such losses by the Investment Manager. Therefore, investors who cannot accept
this risk should not invest in shares of the Fund.

To ensure the highest quality of service, telephone calls to or from our service
departments may be monitored, recorded and accessed . These calls can be
identified by the presence of a regular beeping tone.

TLEMF A2005 10/05

ITEM 2. CODE OF ETHICS.

(a) The Registrant has adopted a code of ethics that applies to its principal
executive officers and principal financial and accounting officer.

(d) N/A

(f) Pursuant to Item 12(a)(1), the registrant is attaching as an exhibit a copy
of its code of ethics that applies to its principal executive officers and
principal financial and accounting officer.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

(a)(1) The Registrant has an audit committee financial expert serving on its
audit committee.

(2) The audit committee financial experts are Fred R. Millsaps and Frank A.
Olson, they are "independent" as defined under the relevant Securities and
Exchange Commission Rules and Releases.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees
The aggregate fees paid to the principal accountant for professional services
rendered by the principal accountant for the audit of the registrant's annual
financial statements or for services that are normally provided by the principal
accountant in connection with statutory and regulatory filings or engagements
were $24,753 for the fiscal year ended August 31, 2005 and $6,052 for the fiscal
year ended August 31, 2004.

(b) Audit-Related Fees
There were no fees paid to the principal accountant for assurance and related
services rendered by the principal accountant to the registrant that are
reasonably related to the performance of the audit of the registrant's financial
statements and are not reported under paragraph (a) of Item 4.

The aggregate fees paid to the principal accountant for assurance and related
services rendered by the principal accountant to the registrant's investment
adviser and any entity controlling, controlled by or under common control with
the investment adviser that provides ongoing services to the registrant that are
reasonably related to the performance of the audit of their financial statements
were $0 for the fiscal year ended August 31, 2005 and $48,579 for the fiscal
year ended August 31, 2004. The services for which these fees were paid included
attestation services.

(c) Tax Fees
There were no fees paid to the principal accountant for professional services
rendered by the principal accountant to the registrant for tax compliance, tax
advice and tax planning.

The aggregate fees paid to the principal accountant for professional services
rendered by the principal accountant to the registrant's investment adviser and
any entity controlling, controlled by or under common control with the
investment adviser that provides ongoing services to the registrant for tax
compliance, tax advice and tax planning were $24,546 for the fiscal year ended
August 31, 2005 and $0 for the fiscal year ended August 31, 2004. The services
for which these fees were paid included tax compliance and advise.

(d) All Other Fees
The aggregate fees paid to the principal accountant for products and services
rendered by the principal accountant to the registrant not reported in
paragraphs (a)-(c) of Item 4 were $0 for the fiscal year ended August 31, 2005
and $100 for the fiscal year ended August 31, 2004. The services for which these
fees were paid included review of materials provided to the fund Board in
connection with the investment management contract renewal process.

The aggregate fees paid to the principal accountant for products and services
rendered by the principal accountant to the registrant's investment adviser and
any entity controlling, controlled by or under common control with the
investment adviser that provides ongoing services to the registrant not reported
in paragraphs (a)-(c) of Item 4 were $340 for the fiscal year ended August 31,
2005 and $99,985 for the fiscal year ended August 31, 2004. The services for
which these fees were paid included review of materials provided to the fund
Board in connection with the investment management contract renewal process.

(e) (1) The registrant's audit committee is directly responsible for approving
the services to be provided by the auditors, including:

(i) pre-approval of all audit and audit related services;

(ii) pre-approval of all non-audit related services to be provided to the
Fund by the auditors;

(iii) pre-approval of all non-audit related services to be provided to the
registrant by the auditors to the registrant's investment adviser or to any
entity that controls, is controlled by or is under common control with the
registrant's investment adviser and that provides ongoing services to the
registrant where the non-audit services relate directly to the operations or
financial reporting of the registrant; and

(iv) establishment by the audit committee, if deemed necessary or
appropriate, as an alternative to committee pre-approval of services to be
provided by the auditors, as required by paragraphs (ii) and (iii) above, of
policies and procedures to permit such services to be pre-approved by other
means, such as through establishment of guidelines or by action of a designated
member or members of the committee; provided the policies and procedures are
detailed as to the particular service and the committee is informed of each
service and such policies and procedures do not include delegation of audit
committee responsibilities, as contemplated under the Securities Exchange Act of
1934, to management; subject, in the case of (ii) through (iv), to any waivers,
exceptions or exemptions that may be available under applicable law or rules.

(e) (2) None of the services provided to the registrant described in paragraphs
(b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of regulation S-X.

(f) No disclosures are required by this Item 4(f).

(g) The aggregate non-audit fees paid to the principal accountant for services
rendered by the principal accountant to the registrant and the registrant's
investment adviser and any entity controlling, controlled by or under common
control with the investment adviser that provides ongoing services to the
registrant were $24,886 for the fiscal year ended August 31, 2005 and $148,664
for the fiscal year ended August 31, 2004.

(h) The registrant's audit committee of the board of trustees has considered
whether the provision of non-audit services that were rendered to the
registrant's investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining the principal accountant's
independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Members of the Audit Committee are: Fred R. Millsaps, Frank J. Crothers, Frank
A. Olson and Constantine D. Tseretopoulos.

ITEM 6. SCHEDULE OF INVESTMENTS. N/A

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

The board of trustees of the Fund has delegated the authority to vote proxies
related to the portfolio securities held by the Fund to the Fund's manager
Templeton Asset Management Limited in accordance with the Proxy Voting Policies
and Procedures (Policies) adopted by the manager.

The manager has delegated its administrative duties with respect to the voting
of proxies to the Proxy Group within Franklin Templeton Companies, LLC (Proxy
Group), an affiliate and wholly owned subsidiary of Franklin Resources, Inc. All
proxies received by the Proxy Group will be voted based upon the manager's
instructions and/or policies.

To assist it in analyzing proxies, the manager subscribes to Institutional
Shareholder Services (ISS), an unaffiliated third party corporate governance
research service that provides in-depth analyses of shareholder meeting agendas,
vote recommendations, recordkeeping and vote disclosure services. In addition,
the manager subscribes to Glass, Lewis & Co., LLC (Glass Lewis), an unaffiliated
third party analytical research firm, to receive analyses and vote
recommendations on the shareholder meetings of publicly held U.S. companies.
Although ISS' and/or Glass Lewis' analyses are thoroughly reviewed and
considered in making a final voting decision, the manager does not consider
recommendations from ISS, Glass Lewis or any other third party to be
determinative of the manager's ultimate decision. The manager votes proxies
solely in the interests of the Fund and its shareholders. As a matter of policy,
the officers, directors/trustees and employees of the Fund, the manager and the
Proxy Group will not be influenced by outside sources whose interests conflict
with the interests of the Fund and its shareholders. All conflicts are resolved
in the interests of the manager's clients. In situations where the manager
perceives a material conflict of interest, the manager may: disclose the
conflict to the Fund's board of trustees; defer to the voting recommendation of
the Fund's board of trustees, ISS, Glass Lewis or those of another independent
third party provider of proxy services; or take such other action in good faith
(in consultation with counsel) which would protect the interests of the Fund and
its shareholders.

The recommendation of management on any issue is a factor which the manager
considers in determining how proxies should be voted, but is not determinative
of the manager's ultimate decision. As a matter of practice, the votes with
respect to most issues are cast in accordance with the position of the company's
management. Each issue, however, is considered on its own merits, and the
manager will not support the position of the company's management in any
situation where it deems that the ratification of management's position would
adversely affect the investment merits of owning that company's shares.

MANAGER'S PROXY VOTING POLICIES AND PRINCIPLES The manager has adopted general
proxy voting guidelines, which are summarized below. These guidelines are not an
exhaustive list of all the issues that may arise and the manager cannot
anticipate all future situations. In all cases, each proxy will be considered
based on the relevant facts and circumstances.

BOARD OF DIRECTORS. The manager supports an independent board of directors, and
prefers that key committees such as audit, nominating, and compensation
committees be comprised of independent directors. The manager will generally
vote against management efforts to classify a board and will generally support
proposals to declassify the board of directors. The manager may withhold votes
from directors who have attended less than 75% of meetings without a valid
reason. While generally in favor of separating Chairman and CEO positions, the
manager will review this issue as well as proposals to restore or provide for
cumulative voting on a case-by-case basis, taking into consideration factors
such as the company's corporate governance guidelines or provisions and
performance.

RATIFICATION OF AUDITORS OF PORTFOLIO COMPANIES. In light of several high
profile accounting scandals, the manager will closely scrutinize the role and
performance of auditors. On a case-by-case basis, the manager will examine
proposals relating to non-audit relationships and non-audit fees. The manager
will also consider, on a case-by-case basis, proposals to rotate auditors, and
will vote against the ratification of auditors when there is clear and
compelling evidence of accounting irregularities or negligence.

MANAGEMENT AND DIRECTOR COMPENSATION. A company's equity-based compensation plan
should be in alignment with its shareholders' long-term interests. The manager
evaluates plans on a case-by-case basis by considering several factors to
determine whether the plan is fair and reasonable, including the ISS
quantitative model utilized to assess such plans and/or the Glass Lewis
evaluation of the plans. The manager will generally oppose plans that have the
potential to be excessively dilutive, and will almost always oppose plans that
are structured to allow the repricing of underwater options, or plans that have
an automatic share replenishment "evergreen" feature. The manager will generally
support employee stock option plans in which the purchase price is at least 85%
of fair market value, and when potential dilution is 10% or less.

Severance compensation arrangements will be reviewed on a case-by-case basis,
although the manager will generally oppose "golden parachutes" that are
considered to be excessive. The manager will normally support proposals that
require a percentage of directors' compensation to be in the form of common
stock, as it aligns their interests with those of shareholders. The manager will
review on a case-by-case basis any shareholder proposals to adopt policies on
expensing stock option plans.

ANTI-TAKEOVER MECHANISMS AND RELATED ISSUES. The manager generally opposes
anti-takeover measures since they tend to reduce shareholder rights. On
occasion, the manager may vote with management when the research analyst has
concluded that the proposal is not onerous and would not harm the Fund or its
shareholders' interests. The manager generally supports proposals that require
shareholder rights' plans ("poison pills") to be subject to a shareholder vote
and will closely evaluate such plans on a case-by-case basis to determine
whether or not they warrant support. The manager will generally vote against any
proposal to issue stock that has unequal or subordinate voting rights. The
manager generally opposes any supermajority voting requirements as well as the
payment of "greenmail." The manager generally supports "fair price" provisions
and confidential voting.

CHANGES TO CAPITAL STRUCTURE. The manager will review, on a case-by-case basis,
proposals by companies to increase authorized shares and the purpose for the
increase and proposals seeking preemptive rights. The manager will generally not
vote in favor of dual-class capital structures to increase the number of
authorized shares where that class of stock would have superior voting rights.
The manager will generally vote in favor of the issuance of preferred stock in
cases where the company specifies the voting, dividend, conversion and other
rights of such stock and the terms of the preferred stock issuance are deemed
reasonable.

MERGERS AND CORPORATE RESTRUCTURING. Mergers and acquisitions will be subject to
careful review by the research analyst to determine whether each will be
beneficial to shareholders. The manager will analyze various economic and
strategic factors in making the final decision on a merger or acquisition.
Corporate restructuring and reincorporation proposals are also subject to a
thorough examination on a case-by-case basis.

SOCIAL AND CORPORATE POLICY ISSUES. The manager will generally give management
discretion with regard to social, environmental and ethical issues, although the
manager may vote in favor of those that are believed to have significant
economic benefits or implications for the Fund and its shareholders.

GLOBAL CORPORATE GOVERNANCE. Many of the tenets discussed above are applied to
proxy voting decisions for international companies. However, the manager must be
more flexible in these instances and must be mindful of the varied market
practices of each region.

The manager will attempt to process every proxy it receives for all domestic and
foreign proxies. However, there may be situations in which the manager cannot
process proxies, for example, where a meeting notice was received too late, or
sell orders preclude the ability to vote. The manager may abstain from voting
under certain circumstances or vote against items such as "Other Business" when
the manager is not given adequate information from the company.

Shareholders may view the complete Policies online at franklintempleton.com.
Alternatively, shareholders may request copies of the Policies free of charge by
calling the Proxy Group collect at 1-954/847-2268 or by sending a written
request to: Franklin Templeton Companies, LLC, 500 East Broward Boulevard, Suite
1500, Fort Lauderdale, FL 33394, Attention: Proxy Group. Copies of the Fund's
proxy voting records are available online at franklintempleton.com and posted
on the SEC website at WWW.SEC.GOV and reflect the twelve-month period beginning
July 1, 2004, and ending June 30, 2005.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. N/A

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANIES AND AFFILIATED PURCHASES. N/A

ITEM 10. SUBMISSION OF MATTERS OF A VOTE OF SECURITY HOLDERS.

There have been no changes to the procedures by which shareholders may recommend
nominees to the Registrant's Board of Trustees that would require disclosure
herein.

ITEM 11. CONTROLS AND PROCEDURES.

(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains
disclosure controls and procedures that are designed to ensure that information
required to be disclosed in the Registrant's filings under the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 is recorded,
processed, summarized and reported within the periods specified in the rules and
forms of the Securities and Exchange Commission. Such information is accumulated
and communicated to the Registrant's management, including its principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure. The Registrant's management,
including the principal executive officer and the principal financial officer,
recognizes that any set of controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving the desired
control objectives.

Within 90 days prior to the filing date of this Shareholder Report on Form
N-CSR, the Registrant had carried out an evaluation, under the supervision and
with the participation of the Registrant's management, including the
Registrant's principal executive officer and the Registrant's principal
financial officer, of the effectiveness of the design and operation of the
Registrant's disclosure controls and procedures. Based on such evaluation, the
Registrant's principal executive officer and principal financial officer
concluded that the Registrant's disclosure controls and procedures are
effective.

(b) CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the
Registrant's internal controls or in other factors that could significantly
affect the internal controls subsequent to the date of their evaluation in
connection with the preparation of this Shareholder Report on Form N-CSR.

ITEM 12. EXHIBITS

(a)(1) Code of Ethics

(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration, and
Galen G. Vetter, Chief Financial Officer

(b)Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration, and
Galen G. Vetter, Chief Financial Officer

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.

TEMPLETON EMERGING MARKETS FUND

By /s/JIMMY D. GAMBILL
Chief Executive Officer -
Finance and Administration
Date October 21, 2005

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.

By /s/JIMMY D. GAMBILL
Chief Executive Officer -
Finance and Administration
Date October 21, 2005

By /s/GALEN G. VETTER
Chief Financial Officer
Date October 21, 2005