Federated Government Ultrashort Duration Fund

July 31, 2017 Share Class A Institutional Service R6 Ticker FGUAX FGUSX FEUSX FGULX Federated Government Ultrashort Duration Fund Fund Established 1997 A Portfolio of Federated Institutional Trust Dear Valued Shareholder, I am pleased to present the Annual Shareholder Report for your fund covering the period from August 1, 2016 through July 31, 2017. This report includes Management s Discussion of Fund Performance, a complete listing of your fund s holdings, performance information and financial statements along with other important fund information. In addition, our website, FederatedInvestors.com, offers easy access to Federated resources that include timely fund updates, economic and market insights from our investment strategists, and financial planning tools. We invite you to register to take full advantage of its capabilities. Thank you for investing with Federated. I hope you find this information useful and look forward to keeping you informed. Sincerely, J. Christopher Donahue, President Not FDIC Insured May Lose Value No Bank Guarantee

CONTENTS Management s Discussion of Fund Performance... 1 Portfolio of Investments Summary Table... 5 Portfolio of Investments... 6 Financial Highlights... 14 Statement of Assets and Liabilities... 18 Statement of Operations... 20 Statement of Changes in Net Assets... 21 Notes to Financial Statements... 22 Report of Independent Registered Public Accounting Firm... 30 Shareholder Expense Example... 31 Board of Trustees and Trust Officers... 33 Evaluation and Approval of Advisory Contract... 40 Voting Proxies on Fund Portfolio Securities... 47 Quarterly Portfolio Schedule... 47

Management s Discussion of Fund Performance (unaudited) The total return of Federated Government Ultrashort Duration Fund (the Fund ), 1 based on net asset value for the 12-month reporting period ended July 31, 2017, was 0.35% for the Class A Shares, 0.90% for the Institutional Shares, 0.70% for the Service Shares and 0.92% for the Class R6 Shares. The 0.92% total return for the Class R6 Shares for the reporting period consisted of 0.72% in dividends and 0.20% in appreciation of the net asset value of the shares. The total return of the BofA Merrill Lynch U.S. 6-Month Treasury Bill Index (BAML6MT), 2 the Fund s broad-based securities market index, was 0.69% for the same period. The Fund s total return for the most recently completed fiscal year reflected actual cash flows, transaction costs and other expenses which were not reflected in the total return of the index. The Fund s investment strategy focused on the allocation of the portfolio among securities of similar types of issuers (referred to as sectors ) and the selection of individual securities within each sector (referred to as security selection ). These were the most significant factors affecting the Fund s performance relative to the BAML6MT. The following discussion will focus on the performance of the Fund s Class R6 Shares. MARKET OVERVIEW The Federal Reserve ( the Fed ) tightened monetary policy three times over the course of the reporting period, bringing the federal funds target range from 0.25% to 0.50% to a range of 1.00% to 1.25%. The moves by the Fed were well-communicated to the market and came in spite of signs of weaker-thanexpected economic growth and low inflation. The surprise outcome from the Presidential election late in 2016 raised speculation that potential fiscal stimulus could prompt the Fed to tighten more aggressively than had been reflected by market expectations. As the new administration struggled to push changes through Congress, those expectations receded, reverting to the shallower tightening path for Fed action that had been in place previously. The market environment for government agency mortgage-backed securities (MBS) continued to improve throughout the reporting period, with spreads tightening from the wide levels reached in 2016. Interest rates at the front end of the yield curve followed the policy actions by the Fed, with the yield on the 2-year Treasury note rising from 0.66% at the start of the period to 1.36% on July 31, 2017. Toward the end of the reporting period, the Fed telegraphed to the market that it would soon begin the process of tapering its reinvestments of Treasuries and agency MBS relatively soon, with market expectations centering on an announcement at the upcoming September 2017 Federal Open Market Committee meeting. 1

SECTOR As of July 31, 2017, approximately 47% of the portfolio holdings were in agency MBS, down from 53% a year earlier. 3 This sector offered incremental yield relative to traditional government money market securities, and spread tightening in this sector resulted in price appreciation. This price appreciation contributed to the Fund s outperformance over the reporting period relative to the BAML6MT. SECURITY SELECTION 4 The Fund invests primarily in two types of mortgage securities: hybrid-arm pass-throughs and floating-rate collateralized mortgage obligations (CMOs). These types of MBS held within the portfolio typically have less spread and price volatility than fixed-rate MBS. During the reporting period, Fund management continued to favor floating rate CMOs because of their relatively low price volatility and shorter reset frequencies that make them more responsive to a rising interest rate environment. Approximately 43% of the Fund s assets were allocated to this sector as of July 31, 2017. The Fund also held a modest position in hybrid-arm pass-throughs over the reporting period, with such holdings comprising 4% of Fund assets as of July 31, 2017, which percentage was relatively unchanged from a year earlier. Both types of MBS securities offered increased yield relative to money market instruments. In addition, spread tightening on these holdings led to price appreciation that contributed to overall fund performance. As a result, this allocation contributed to the Fund s outperformance relative to the BAML6MT. 1 The Fund is not a money market fund. Some money market funds attempt to maintain a stable net asset value through compliance with relevant SEC rules. The Fund is not governed by those rules, and its shares will fluctuate in value. 2 Please see the footnotes to the line graphs below for definitions of, and further information about, the BAML6MT. 3 The value of some mortgage-backed securities may be particularly sensitive to changes in prevailing interest rates, and although the securities are generally supported by some form of government or private insurance, there is no assurance that private guarantors or insurers will meet their obligations. 4 Bond prices are sensitive to changes in interest rates and a rise in interest rates can cause a decline in their prices. 2

FUND PERFORMANCE AND GROWTH OF A $10,000 INVESTMENT The graph below illustrates the hypothetical investment of $10,000 1 in the Federated Government Ultrashort Duration Fund from July 31, 2007 to July 31, 2017, compared to the BofA Merrill Lynch U.S. 6-Month Treasury Bill Index (BAML6MT). 2 The Average Annual Total Return table below shows returns for each class averaged over the stated periods. GROWTH OF A $10,000 INVESTMENT Growth of $10,000 as of July 31, 2017 Federated Government Ultrashort Duration Fund - Institutional Shares Federated Government Ultrashort Duration Fund - Class A Shares BAML6MT $12,000 $11,000 $10,000 $11,021 $10,947 $10,320 $9,000 7/31/07 7/08 7/09 7/10 7/11 7/12 7/13 7/14 7/15 7/16 7/31/17 Total returns shown for Class A Shares include the maximum sales charge of 2.00% ($10,000 investment minus $200 sales charge = $9,800). The Fund offers multiple share classes whose performance may be greater than or less than its other share class(es) due to differences in sales charges and expenses. See the Average Annual Total Return table below for the returns of additional classes not shown in the line graph above. Average Annual Total Returns for the Period Ended 7/31/2017 (returns reflect all applicable sales charges and contingent deferred sales charge as specified below in footnote #1) 1 Year 5 Years 10 Years Class A Shares -1.65% -0.52% 0.32% Institutional Shares 0.90% 0.34% 0.98% Service Shares 0.70% 0.22% 0.87% Class R6 Shares 3 0.92% 0.13% 0.73% BAML6MT 0.69% 0.35% 0.91% 3

Performance data quoted represents past performance which is no guarantee of future results. Investment return and principal value will fluctuate so that an investor s shares, when redeemed, may be worth more or less than their original cost. Mutual fund performance changes over time and current performance may be lower or higher than what is stated. For current to the most recent month-end performance and after-tax returns, visit FederatedInvestors.com or call 1-800-341-7400. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Mutual funds are not obligations of or guaranteed by any bank and are not federally insured. 1 Represents a hypothetical investment of $10,000 in the Fund s Class A Shares after deducting the maximum sales charge of 2.00% ($10,000 investment minus $200 sales charge = $9,800). The Fund s performance assumes the reinvestment of all dividends and distributions. The BAML6MT has been adjusted to reflect reinvestment of dividends on securities in the index. 2 The BAML6MT is an unmanaged index tracking six-month U.S. Treasury securities. The BAML6MT is not adjusted to reflect sales charges, expenses or other fees that the Securities and Exchange Commission requires to be reflected in the Fund s performance. The index is unmanaged and, unlike the Fund, is not affected by cash flows. It is not possible to invest directly in an index. 3 The Fund s Class R6 Shares commenced operations on March 29, 2016. For the periods prior to the commencement of operations of Class R6 Shares, the performance information shown is for the Fund s Institutional Share Class. The performance of the Institutional Share Class has not been adjusted to reflect the expenses of the Class R6 Shares since the Class R6 Shares have a lower expense ratio than the expense ratio of the Institutional Share Class. 4

Portfolio of Investments Summary Table (unaudited) At July 31, 2017, the Fund s portfolio composition 1 was as follows: Percentage of Type of Investments Total Net Assets U.S. Government Agency Mortgage-Backed Securities 47.5% U.S. Government Agency Securities 13.6% U.S. Treasury Securities 1.6% Repurchase Agreements Cash 37.4% Other Assets and Liabilities Net 2 (0.1)% TOTAL 100.0% 1 See the Fund s Prospectus and Statement of Additional Information for a description of the types of securities in which the Fund invests. 2 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. 5

Portfolio of Investments July 31, 2017 Principal Amount Value ADJUSTABLE RATE MORTGAGES 4.0% Federal National Mortgage Association ARM 4.0% $ 332,751 2.045%, 9/1/2027 $ 336,784 404,055 2.132%, 5/1/2040 408,611 70,576 2.132%, 5/1/2040 71,377 236,194 2.132%, 8/1/2040 238,505 1,266,443 2.456%, 4/1/2033 1,296,497 1,225,368 2.591%, 6/1/2038 1,272,515 236,467 2.700%, 7/1/2033 243,470 25,764 2.702%, 8/1/2032 26,995 2,911,157 2.729%, 1/1/2035 3,053,460 659,171 2.740%, 4/1/2024 675,711 22,523 2.915%, 12/1/2032 23,717 14,587 2.965%, 2/1/2033 15,323 11,356,146 3.015%, 12/1/2035 12,000,675 5,910,109 3.016%, 2/1/2039 6,088,400 738,745 3.067%, 6/1/2036 765,110 1,308,954 3.114%, 8/1/2034 1,374,617 1,411,669 3.136%, 9/1/2037 1,470,428 1,608,103 3.188%, 1/1/2035 1,686,088 188,892 3.219%, 2/1/2037 198,219 321,533 3.445%, 3/1/2033 338,154 1,194,550 3.459%, 9/1/2035 1,266,868 862,239 3.470%, 6/1/2036 907,615 207,048 3.657%, 5/1/2036 220,015 TOTAL ADJUSTABLE RATE MORTGAGES (IDENTIFIED COST $33,875,948) 33,979,154 COLLATERALIZED MORTGAGE OBLIGATIONS 43.5% Federal Home Loan Mortgage Corporation REMIC 4.7% 29,993 Series 1146 E, 2.276%, 9/15/2021 30,288 521,844 Series 1534 J, 2.126%, 6/15/2023 526,378 489,995 Series 1632 FB, 2.426%, 11/15/2023 495,635 253,639 Series 2111 MA, 1.726%, 1/15/2029 255,266 259,153 Series 2111 MB, 1.726%, 1/15/2029 260,816 264,667 Series 2111 MC, 1.726%, 1/15/2029 266,365 181,312 Series 2286 FA, 1.626%, 2/15/2031 182,091 162,090 Series 2292 KF, 1.482%, 7/25/2022 162,148 6

Principal Amount Value COLLATERALIZED MORTGAGE OBLIGATIONS continued Federal Home Loan Mortgage Corporation REMIC continued $ 371,432 Series 2296 FC, 1.726%, 6/15/2029 $ 373,709 626,666 Series 2326 FJ, 2.176%, 6/15/2031 636,571 780,112 Series 2344 FP, 2.176%, 8/15/2031 792,784 390,571 Series 2367 FG, 1.846%, 6/15/2031 394,846 156,980 Series 2380 FI, 1.826%, 6/15/2031 158,579 1,007,967 Series 2380 FL, 1.826%, 11/15/2031 1,017,436 507,537 Series 2386 FE, 1.926%, 6/15/2031 514,410 206,337 Series 2389 FI, 1.976%, 6/15/2031 209,520 48,731 Series 2395 FT, 1.676%, 12/15/2031 49,033 127,989 Series 2396 FL, 1.826%, 12/15/2031 129,081 616,560 Series 2412 OF, 2.176%, 12/15/2031 626,295 614,732 Series 2418 FO, 2.126%, 2/15/2032 622,967 293,373 Series 242 F29, 1.476%, 11/15/2036 292,458 227,151 Series 244 F22, 1.576%, 12/15/2036 227,258 535,187 Series 244 F30, 1.526%, 12/15/2036 534,474 202,217 Series 2451 FC, 2.226%, 5/15/2031 205,860 17,004 Series 2452 FG, 1.776%, 3/15/2032 17,185 287,836 Series 2460 FE, 2.226%, 6/15/2032 293,149 148,344 Series 2470 FI, 1.626%, 10/15/2026 148,854 205,014 Series 2470 FW, 2.226%, 5/15/2031 208,552 196,290 Series 2470 FX, 2.226%, 5/15/2031 199,678 289,129 Series 2470 GF, 2.226%, 6/15/2032 294,465 140,135 Series 2471 FS, 1.726%, 2/15/2032 141,114 652,556 Series 2475 FL, 2.226%, 2/15/2032 664,779 435,037 Series 2476 FC, 2.226%, 2/15/2032 443,186 285,451 Series 2477 FD, 1.626%, 7/15/2032 286,824 448,785 Series 2479 FA, 1.626%, 8/15/2032 450,431 150,584 Series 2481 FC, 2.226%, 5/15/2031 153,504 327,949 Series 2493 F, 1.626%, 9/15/2029 329,387 486,372 Series 2495 F, 1.626%, 9/15/2032 487,868 299,203 Series 2498 HF, 2.226%, 6/15/2032 304,725 153,911 Series 2504 FP, 1.726%, 3/15/2032 154,992 590,762 Series 2526 FC, 1.626%, 11/15/2032 593,400 514,276 Series 2530 FK, 1.626%, 6/15/2029 515,653 806,670 Series 2551 FD, 1.626%, 1/15/2033 809,143 34,582 Series 2571 FB, 1.576%, 2/15/2018 34,595 549,349 Series 2571 FK, 1.726%, 9/15/2023 552,381 150,347 Series 2610 FD, 1.726%, 12/15/2032 151,400 7

Principal Amount Value COLLATERALIZED MORTGAGE OBLIGATIONS continued Federal Home Loan Mortgage Corporation REMIC continued $ 2,391,774 Series 2631 FC, 1.626%, 6/15/2033 $ 2,399,498 557,730 Series 2671 F, 1.676%, 9/15/2033 560,637 780,376 Series 2684 FV, 2.126%, 10/15/2033 792,945 624,314 Series 2711 FD, 1.726%, 4/15/2018 624,720 2,565,693 Series 2750 FG, 1.626%, 2/15/2034 2,578,720 5,449,913 Series 2750 FH, 1.726%, 2/15/2034 5,506,291 206,767 Series 2758 FH, 1.576%, 3/15/2019 206,961 398,050 Series 2763 FB, 1.576%, 4/15/2032 398,488 594,621 Series 2796 FD, 1.576%, 7/15/2026 595,749 1,575,437 Series 2812 LF, 1.626%, 6/15/2034 1,581,460 366,440 Series 2861 AF, 1.526%, 9/15/2034 366,414 987,272 Series 3036 NF, 1.526%, 8/15/2035 985,908 206,171 Series 3085 FW, 1.926%, 8/15/2035 209,259 1,196,231 Series 3085 VF, 1.546%, 12/15/2035 1,195,901 1,133,421 Series 3184 JF, 1.626%, 7/15/2036 1,136,649 1,105,258 Series 3191 FE, 1.626%, 7/15/2036 1,107,596 122,726 Series 3300 FA, 1.526%, 8/15/2035 122,548 123,162 Series 3325 NF, 1.526%, 8/15/2035 122,983 1,704,560 Series 3380 FP, 1.576%, 11/15/2036 1,704,125 1,207,925 Series 3542 NF, 1.976%, 7/15/2036 1,225,251 TOTAL 39,621,636 Federal National Mortgage Association REMIC 13.1% 299,061 Series 1993-165 FE, 2.382%, 9/25/2023 303,478 146,448 Series 1993-62 FA, 1.848%, 4/25/2023 148,031 203,280 Series 1998-22 FA, 1.626%, 4/18/2028 204,121 60,587 Series 2000-34 F, 1.682%, 10/25/2030 60,987 43,154 Series 2000-37 FA, 1.732%, 11/25/2030 43,229 123,138 Series 2001-34 FB, 1.526%, 12/18/2028 123,316 77,054 Series 2001-34 FL, 1.732%, 8/25/2031 77,544 657,576 Series 2001-46 F, 1.626%, 9/18/2031 659,679 305,352 Series 2001-53 FX, 1.582%, 10/25/2031 304,303 722,717 Series 2001-56 FG, 1.732%, 10/25/2031 727,963 293,105 Series 2001-68 FD, 1.732%, 12/25/2031 294,845 476,857 Series 2002-17 JF, 2.232%, 4/25/2032 485,902 473,086 Series 2002-34 FC, 2.226%, 12/18/2031 481,742 290,402 Series 2002-37 F, 2.032%, 11/25/2031 294,886 15,503 Series 2002-39 FB, 1.776%, 3/18/2032 15,669 236,062 Series 2002-4 FJ, 1.682%, 2/25/2032 237,522 8

Principal Amount Value COLLATERALIZED MORTGAGE OBLIGATIONS continued Federal National Mortgage Association REMIC continued $ 175,418 Series 2002-41 F, 1.782%, 7/25/2032 $ 176,794 1,392,530 Series 2002-47 NF, 2.232%, 4/25/2032 1,420,086 207,039 Series 2002-52 FD, 1.732%, 9/25/2032 208,870 300,652 Series 2002-53 FG, 2.332%, 7/25/2032 307,401 1,018,891 Series 2002-58 FD, 1.832%, 8/25/2032 1,029,908 342,375 Series 2002-64 FJ, 2.232%, 4/25/2032 348,869 273,584 Series 2002-74 FV, 1.682%, 11/25/2032 274,855 210,910 Series 2002-75 FD, 2.226%, 11/18/2032 214,884 776,434 Series 2002-77 FH, 1.626%, 12/18/2032 778,462 349,863 Series 2002-8 FA, 1.976%, 3/18/2032 355,343 131,902 Series 2002-82 FB, 1.732%, 12/25/2032 132,850 538,523 Series 2002-82 FC, 2.232%, 9/25/2032 549,842 287,895 Series 2002-82 FG, 1.682%, 12/25/2032 289,631 1,023,940 Series 2002-89 F, 1.532%, 1/25/2033 1,025,153 324,901 Series 2002-9 FH, 1.732%, 3/25/2032 327,622 215,407 Series 2002-90 FH, 1.732%, 9/25/2032 216,934 2,049,755 Series 2002-93 FJ, 1.782%, 1/25/2033 2,069,081 426,180 Series 2003-102 FT, 1.632%, 10/25/2033 428,234 1,127,159 Series 2003-107 FD, 1.732%, 11/25/2033 1,135,735 2,724,368 Series 2003-116 HF, 1.782%, 11/25/2033 2,751,033 294,361 Series 2003-117 KF, 1.632%, 8/25/2033 294,493 858,978 Series 2003-121 FD, 1.632%, 12/25/2033 861,733 256,743 Series 2003-14 FT, 1.732%, 3/25/2033 258,667 646,651 Series 2003-19 FY, 1.632%, 3/25/2033 648,704 226,122 Series 2003-2 FA, 1.732%, 2/25/2033 227,747 411,353 Series 2003-21 TF, 1.682%, 3/25/2033 413,412 59,867 Series 2003-35 FY, 1.632%, 5/25/2018 59,881 748,658 Series 2003-66 FA, 1.582%, 7/25/2033 749,318 792,516 Series 2003-79 FC, 1.682%, 8/25/2033 796,743 1,511,968 Series 2004-17 FT, 1.632%, 4/25/2034 1,517,133 1,698,225 Series 2004-2 FW, 1.632%, 2/25/2034 1,705,039 1,256,385 Series 2004-49 FN, 1.632%, 7/25/2034 1,261,636 2,932,422 Series 2004-49 FQ, 1.682%, 7/25/2034 2,949,658 2,323,023 Series 2004-51 FY, 1.612%, 7/25/2034 2,328,108 939,015 Series 2004-53 FC, 1.682%, 7/25/2034 944,297 724,936 Series 2004-64 FW, 1.682%, 8/25/2034 732,563 1,108,138 Series 2005-104 FA, 1.632%, 12/25/2035 1,111,381 889,686 Series 2006-60 FD, 1.662%, 4/25/2035 891,289 9

Principal Amount Value COLLATERALIZED MORTGAGE OBLIGATIONS continued Federal National Mortgage Association REMIC continued $ 4,695,374 Series 2006-75 FP, 1.532%, 8/25/2036 $ 4,689,374 930,068 Series 2006-79 DF, 1.582%, 8/25/2036 930,958 1,439,755 Series 2006-81 FA, 1.582%, 9/25/2036 1,442,107 2,980,678 Series 2006-90 FE, 1.682%, 9/25/2036 2,996,257 1,575,639 Series 2006-98 FB, 1.542%, 10/25/2036 1,574,175 4,877,845 Series 2006-W1 2AF1, 1.452%, 2/25/2046 4,832,346 1,606,830 Series 2008-52 FD, 1.582%, 6/25/2036 1,606,663 25,578,871 Series 2012-116 FA, 1.532%, 10/25/2042 25,521,467 31,072,988 Series 2017-5 PH, 3.000%, 1/25/2037 31,574,611 TOTAL 111,424,564 Government National Mortgage Association REMIC 25.1% 111,122 Series 2001-21 FB, 1.626%, 1/16/2027 111,434 166,194 Series 2001-22 FG, 1.576%, 5/16/2031 166,534 1,947,817 Series 2002-17 FK, 1.778%, 3/20/2032 1,965,196 421,249 Series 2004-59 FV, 1.478%, 10/20/2033 420,890 1,415,138 Series 2009-96 GF, 1.676%, 4/16/2039 1,417,750 16,244,970 Series 2011-H07 FA, 1.576%, 2/20/2061 16,246,232 24,471,466 Series 2012-H15 FB, 1.576%, 6/20/2062 24,475,626 7,095,863 Series 2012-H18 FA, 1.626%, 8/20/2062 7,096,361 6,004,972 Series 2012-H18 SA, 1.656%, 8/20/2062 6,014,153 11,911,470 Series 2012-H24 FC, 1.476%, 10/20/2062 11,849,261 25,965,368 Series 2012-H25 BF, 1.456%, 9/20/2062 25,854,096 21,825,950 Series 2012-H29 BF, 1.416%, 11/20/2062 21,724,972 19,281,425 Series 2012-H29 CF, 1.416%, 2/20/2062 19,174,132 3,021,259 Series 2012-H30 SA, 1.446%, 12/20/2062 2,999,344 15,136,026 Series 2012-H31 FA, 1.426%, 11/20/2062 15,071,342 28,839,359 Series 2015-H02 FA, 1.726%, 1/20/2065 28,838,445 29,637,621 Series 2015-H06 FB, 1.726%, 2/20/2065 29,636,993 TOTAL 213,062,761 Fannie Mae 0.6% 203,556 Fannie Mae BA 4035 BA 4035 FB, 1.732%, 8/25/2039 204,485 1,171,005 Fannie Mae FA, 1.732%, 9/25/2038 1,174,779 3,969,281 Fannie Mae GS 3381 GS 3381 FC, 1.832%, 2/25/2037 3,994,201 TOTAL 5,373,465 TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (IDENTIFIED COST $371,230,918) 369,482,426 10

Principal Amount Value GOVERNMENT AGENCIES 13.6% Federal Farm Credit Bank System Floating Rate Notes 4.4% 1 $ 5,000,000 1.140%, 05/15/2019 $ 4,996,859 10,000,000 1.183%, 2/21/2019 10,003,876 5,000,000 1.183%, 03/13/2019 5,002,406 5,000,000 1.222%, 9/25/2017 4,999,346 7,500,000 1.353%, 12/04/2017 7,507,397 5,000,000 1.393%, 11/28/2017 5,001,453 TOTAL 37,511,337 Federal Farm Credit System 0.7% 5,000,000 1.417%, 9/20/2019 5,022,402 500,000 3.150%, 1/12/2018 504,167 TOTAL 5,526,569 Federal Home Loan Bank Notes 1.4% 2,000,000 0.950%, 8/08/2018 1,994,545 5,000,000 1.000% 12/19/2017 4,994,767 4,950,000 1.000%, 02/28/2018 4,942,056 TOTAL 11,931,368 Federal Home Loan Bank System Floating Rate Notes 4.1% 1 10,000,000 0.950%, 8/28/2017 9,999,012 5,000,000 1.000%, 5/10/2019 4,997,734 10,000,000 1.013%,, 01/24/2018 9,996,451 10,000,000 1.160%,, 08/10/2017 10,000,129 TOTAL 34,993,326 Federal Home Loan Mortgage Corporation 1.9% 6,250,000 0.875%, 3/7/2018 6,234,494 5,000,000 0.900%, 12/28/2017 4,993,839 5,000,000 1.000%, 12/15/2017 4,994,919 TOTAL 16,223,252 Federal Home Loan Mortgage Corporation Floating Rate Notes 0.6% 1 5,000,000 1.239%, 3/8/2018 5,006,235 Federal National Mortgage Association 0.5% 4,156,000 0.875%, 2/8/2018 4,147,182 TOTAL GOVERNMENT AGENCIES (IDENTIFIED COST $115,364,986) 115,339,269 MORTGAGE-BACKED SECURITIES 0.0% Federal National Mortgage Association 0.0% 52,749 7.500%, 30 Year, 1/1/2032 62,131 11

Principal Amount Value MORTGAGE-BACKED SECURITIES continued Federal National Mortgage Association continued $ 206,206 7.500%, 30 Year, 8/1/2032 $ 244,484 TOTAL MORTGAGE-BACKED SECURITIES (IDENTIFIED COST $275,544) 306,615 U.S. TREASURIES 1.6% U.S. Treasury Notes 1.6% 10,000,000 United States Treasury Note, 0.625%, 8/31/2017 9,995,320 4,000,000 United States Treasury Note, 4.750%, 8/15/2017 4,004,671 TOTAL U.S. TREASURY (IDENTIFIED COST $14,005,916) 13,999,991 REPURCHASE AGREEMENTS 37.4% 167,641,000 Interest in $1,000,000,000 joint repurchase agreement 1.05%, dated 7/31/2017 under which Bank of America, N.A. will repurchase securities provided as collateral for $1,000,029,167 on 8/1/2017. The securities provided as collateral at the end of the period held with BNY Mellon as tri-party agent, were U.S. Government Agency securities maturing on 2/25/2044 and the market value of those underlying securities was $1,030,030,042. 167,641,000 150,000,000 Interest in $550,000,000 joint repurchase agreement 1.06%, dated 7/31/2017 under which Mizuho Securities USA, Inc. will repurchase securities provided as collateral for $550,016,194 on 8/1/2017. The securities provided as collateral at the end of the period held with BNY Mellon as tri-party agent, were U.S. Government Agency securities with various maturities to 1/1/2047 and the market value of those underlying securities was $561,699,739. 150,000,000 TOTAL REPURCHASE AGREEMENTS (AT COST) 317,641,000 TOTAL INVESTMENTS 100.1% (IDENTIFIED COST $852,394,312) 2 850,748,455 OTHER ASSETS AND LIABILITIES - NET (0.1)% 3 (535,972) TOTAL NET ASSETS 100% $850,212,483 1 Represents the current interest rate for the floating rate security. 2 Also represents cost for federal tax purposes. 3 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. Note: The categories of investments are shown as a percentage of total net assets at July 31, 2017. 12

Various inputs are used in determining the value of the Fund s investments. These inputs are summarized in the three broad levels listed below: Level 1 quoted prices in active markets for identical securities. Level 2 other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Also includes securities valued at amortized cost. Level 3 significant unobservable inputs (including the Fund s own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities. As of July 31, 2017, all investments of the Fund utilized Level 2 inputs in valuing the Fund s assets carried at fair value. The following acronyms are used throughout this portfolio: ARM Adjustable Rate Mortgage REMIC Real Estate Mortgage Investment Conduit See Notes which are an integral part of the Financial Statements 13

Financial Highlights Class A Shares (For a Share Outstanding Throughout Each Period) Year Ended July 31 2017 2016 2015 2014 2013 Net Asset Value, Beginning of Period $9.82 $9.87 $9.88 $9.89 $9.92 Income From Investment Operations: Net investment income (loss) 0.03 1 (0.01) 1 (0.02) 1 (0.02) (0.01) Net realized and unrealized gain (loss) on investments 0.00 2 (0.04) 0.01 0.01 (0.02) TOTAL FROM INVESTMENT OPERATIONS 0.03 (0.05) (0.01) (0.01) (0.03) Less Distributions: Distributions from net investment income (0.02) (0.00) 2 (0.00) 2 Distributions from net realized gain on investments (0.00) 2 TOTAL DISTRIBUTIONS (0.02) (0.00) 2 (0.00) 2 Net Asset Value, End of Period $9.83 $9.82 $9.87 $9.88 $9.89 Total Return 3 0.35% (0.49)% (0.10)% (0.10)% (0.29)% Ratios to Average Net Assets: Net expenses 0.71% 0.70% 0.70% 0.70% 0.70% Net investment income (loss) 0.25% (0.08)% (0.19)% (0.18)% (0.05)% Expense waiver/reimbursement 4 0.33% 0.37% 0.36% 0.36% 0.34% Supplemental Data: Net assets, end of period (000 omitted) $9,318 $8,265 $14,369 $22,915 $29,749 Portfolio turnover 19% 8% 22% 9% 43% 1 Per share numbers have been calculated using the average shares method. 2 Represents less than $0.01. 3 Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. 4 This expense decrease is reflected in both the net expense and the net investment income (loss) ratios shown above. See Notes which are an integral part of the Financial Statements 14

Financial Highlights Institutional Shares (For a Share Outstanding Throughout Each Period) Year Ended July 31 2017 2016 2015 2014 2013 Net Asset Value, Beginning of Period $9.87 $9.92 $9.91 $9.90 $9.92 Income From Investment Operations: Net investment income 0.07 0.04 1 0.03 1 0.03 0.04 Net realized and unrealized gain (loss) on investments 0.02 (0.05) 0.01 0.01 (0.02) TOTAL FROM INVESTMENT OPERATIONS 0.09 (0.01) 0.04 0.04 0.02 Less Distributions: Distributions from net investment income (0.07) (0.04) (0.03) (0.03) (0.04) Distributions from net realized gain on investments (0.00) 2 TOTAL DISTRIBUTIONS (0.07) (0.04) (0.03) (0.03) (0.04) Net Asset Value, End of Period $9.89 $9.87 $9.92 $9.91 $9.90 Total Return 3 0.90% (0.11)% 0.36% 0.37% 0.17% Ratios to Average Net Assets: Net expenses 0.26% 0.25% 0.25% 0.25% 0.25% Net investment income 0.70% 0.39% 0.26% 0.27% 0.37% Expense waiver/reimbursement 4 0.27% 0.31% 0.31% 0.31% 0.30% Supplemental Data: Net assets, end of period (000 omitted) $580,916 $525,218 $534,159 $603,301 $791,030 Portfolio turnover 19% 8% 22% 9% 43% 1 Per share numbers have been calculated using the average shares method. 2 Represents less than $0.01. 3 Based on net asset value. 4 This expense decrease is reflected in both the net expense and the net investment income ratios shown above. See Notes which are an integral part of the Financial Statements 15

Financial Highlights Service Shares (For a Share Outstanding Throughout Each Period) Year Ended July 31 2017 2016 2015 2014 2013 Net Asset Value, Beginning of Period $9.87 $9.92 $9.91 $9.90 $9.92 Income From Investment Operations: Net investment income 0.06 0.03 1 0.02 1 0.02 0.03 Net realized and unrealized gain (loss) on investments 0.01 (0.05) 0.01 0.01 (0.02) TOTAL FROM INVESTMENT OPERATIONS 0.07 (0.02) 0.03 0.03 0.01 Less Distributions: Distributions from net investment income (0.06) (0.03) (0.02) (0.02) (0.03) Distributions from net realized gain on investments (0.00) 2 TOTAL DISTRIBUTIONS (0.06) (0.03) (0.02) (0.02) (0.03) Net Asset Value, End of Period $9.88 $9.87 $9.92 $9.91 $9.90 Total Return 3 0.70% (0.21)% 0.26% 0.27% 0.07% Ratios to Average Net Assets: Net expenses 0.36% 0.35% 0.35% 0.35% 0.35% Net investment income 0.58% 0.29% 0.16% 0.17% 0.28% Expense waiver/reimbursement 4 0.28% 0.32% 0.31% 0.31% 0.30% Supplemental Data: Net assets, end of period (000 omitted) $254,978 $308,777 $346,922 $451,554 $530,997 Portfolio turnover 19% 8% 22% 9% 43% 1 Per share numbers have been calculated using the average shares method. 2 Represents less than $0.01. 3 Based on net asset value. 4 This expense decrease is reflected in both the net expense and the net investment income ratios shown above. See Notes which are an integral part of the Financial Statements 16

Financial Highlights Class R6 Shares (For a Share Outstanding Throughout Each Period) Year Ended Period Ended 7/31/2017 7/31/2016 1 Net Asset Value, Beginning of Period $9.87 $9.86 Income From Investment Operations: Net investment income 0.09 2 0.02 2 Net realized and unrealized gain (loss) on investments (0.00) 3 0.01 TOTAL FROM INVESTMENT OPERATIONS 0.09 0.03 Less Distributions: Distributions from net investment income (0.07) (0.02) Distributions from net realized gain on investments (0.00) 3 TOTAL DISTRIBUTIONS (0.07) (0.02) Net Asset Value, End of Period $9.89 $9.87 Total Return 4 0.92% 0.28% Ratios to Average Net Assets: Net expenses 0.24% 0.23% 5 Net investment income 0.91% 0.66% 5 Expense waiver/reimbursement 6 0.25% 0.24% 5 Supplemental Data: Net assets, end of period (000 omitted) $5,002 $59 Portfolio turnover 19% 8% 7 1 Reflects operations for the period from March 29, 2016, (date of initial investment) to July 31, 2016. 2 Per share numbers have been calculated using the average shares method. 3 Represents less than $0.01. 4 Based on net asset value. Total returns for periods of less than one year are not annualized. 5 Computed on an annualized basis. 6 This expense decrease is reflected in both the net expense and the net investment income ratios shown above. 7 Portfolio turnover is calculated at the Fund level. Percentage indicated was calculated for the year ended July 31, 2016. See Notes which are an integral part of the Financial Statements 17

Statement of Assets and Liabilities July 31, 2017 Assets: Investment in repurchase agreements $317,641,000 Investment in securities 533,107,455 Total investment in securities, at value (identified cost $852,394,312) $850,748,455 Cash 392 Income receivable 513,857 Receivable for shares sold 264,672 TOTAL ASSETS 851,527,376 Liabilities: Payable for shares redeemed $ 1,069,577 Income distribution payable 46,589 Payable to adviser (Note 5) 2,365 Payable for administrative fees (Note 5) 1,836 Payable for transfer agent fee 71,831 Payable for portfolio accounting fees 55,359 Payable for distribution services fee (Note 5) 1,401 Payable for other service fees (Notes 2) 24,763 Accrued expenses (Note 5) 41,172 TOTAL LIABILITIES 1,314,893 Net assets for 86,009,513 shares outstanding $850,212,483 Net Assets Consist of: Paid-in capital $851,746,952 Net unrealized depreciation of investments (1,645,857) Accumulated net realized gain on investments 1,270 Undistributed net investment income 110,118 TOTAL NET ASSETS $850,212,483 18

Statement of Assets and Liabilities continued Net Asset Value, Offering Price and Redemption Proceeds Per Share Class A Shares: Net asset value per share ($9,317,534 947,699 shares outstanding), no par value, unlimited shares authorized $ 9.83 Offering price per share (100/98.00 of $9.83) $10.03 Redemption proceeds per share $ 9.83 Institutional Shares: Net asset value per share ($580,915,529 58,759,548 shares outstanding), no par value, unlimited shares authorized $ 9.89 Offering price per share $ 9.89 Redemption proceeds per share $ 9.89 Service Shares: Net asset value per share ($254,977,902 25,796,481 shares outstanding), no par value, unlimited shares authorized $ 9.88 Offering price per share $ 9.88 Redemption proceeds per share $ 9.88 Class R6 Shares: Net asset value per share ($5,001,518 505,785 shares outstanding), no par value, unlimited shares authorized $ 9.89 Offering price per share $ 9.89 Redemption proceeds per share $ 9.89 See Notes which are an integral part of the Financial Statements 19

Statement of Operations Year Ended July 31, 2017 Investment Income: Interest $7,788,429 Expenses: Investment adviser fee (Note 5) $ 2,873,227 Administrative fee (Note 5) 644,121 Custodian fees 39,934 Transfer agent fee (Note 2) 451,200 Directors /Trustees fees (Note 5) 9,153 Auditing fees 26,550 Legal fees 10,590 Portfolio accounting fees 166,884 Distribution services fee (Note 5) 23,840 Other service fees (Notes 2) 306,708 Share registration costs 72,718 Printing and postage 22,568 Miscellaneous (Note 5) 46,340 TOTAL EXPENSES 4,693,833 Waivers and Reimbursement: Waiver of investment adviser fee (Note 5) $(2,046,340) Waiver/reimbursement of other operating expenses (Notes 2 and 5) (211,427) TOTAL WAIVERS AND REIMBURSEMENT (2,257,767) Net expenses 2,436,066 Net investment income 5,352,363 Realized and Unrealized Gain (Loss) on Investments: Net realized gain on investments 1,271 Net change in unrealized depreciation of investments 1,372,173 Net realized and unrealized gain on investments 1,373,444 Change in net assets resulting from operations $6,725,807 See Notes which are an integral part of the Financial Statements 20

Statement of Changes in Net Assets Year Ended July 31 2017 2016 Increase (Decrease) in Net Assets Operations: Net investment income $ 5,352,363 $ 2,789,474 Net realized gain on investments 1,271 367,684 Net change in unrealized appreciation/depreciation of investments 1,372,173 (4,820,402) CHANGE IN NET ASSETS RESULTING FROM OPERATIONS 6,725,807 (1,663,244) Distributions to Shareholders: Distributions from net investment income Class A Shares (23,903) (1,852) Institutional Shares (3,606,998) (1,810,373) Service Shares (1,620,056) (960,271) Class R6 Shares (15,735) (29) Distributions from net realized gain on investments Class A Shares (1,260) Institutional Shares (61,542) Service Shares (39,758) Class R6 Shares (157) CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS (5,369,409) (2,772,525) Share Transactions: Proceeds from sale of shares 491,442,598 616,707,826 Net asset value of shares issued to shareholders in payment of distributions declared 5,015,775 2,460,959 Cost of shares redeemed (489,921,133) (667,864,100) CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS 6,537,240 (48,695,315) Change in net assets 7,893,638 (53,131,084) Net Assets: Beginning of period 842,318,845 895,449,929 End of period (including undistributed net investment income of $110,118 and $24,447, respectively) $ 850,212,483 $ 842,318,845 See Notes which are an integral part of the Financial Statements 21

Notes to Financial Statements July 31, 2017 1. ORGANIZATION Federated Institutional Trust (the Trust ) is registered under the Investment Company Act of 1940, as amended (the Act ), as an open-end management investment company. The Trust consists of three portfolios. The financial statements included herein are only those of Federated Government Ultrashort Duration Fund (the Fund ), a diversified portfolio. The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder s interest is limited to the portfolio in which shares are held. Each portfolio pays its own expenses. The Fund offers four classes of shares: Class A Shares, Institutional Shares, Service Shares and Class R6 Shares. All shares of the Fund have equal rights with respect to voting, except on class-specific matters. The Fund s investment objective is to provide current income. 2. SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with U.S. generally accepted accounting principles (GAAP). Investment Valuation In calculating its net asset value (NAV), the Fund generally values investments as follows: Fixed-income securities are fair valued using price evaluations provided by a pricing service approved by the Board of Trustees (the Trustees ). For securities that are fair valued in accordance with procedures established by and under the general supervision of the Trustees, certain factors may be considered such as: the last traded or purchase price of the security, information obtained by contacting the issuer or dealers, analysis of the issuer s financial statements or other available documents, fundamental analytical data, the nature and duration of restrictions on disposition, the movement of the market in which the security is normally traded, public trading in similar securities or derivative contracts of the issuer or comparable issuers, movement of a relevant index, or other factors including but not limited to industry changes and relevant government actions. If any price, quotation, price evaluation or other pricing source is not readily available when the NAV is calculated, if the Fund cannot obtain price evaluations from a pricing service or from more than one dealer for an investment within a reasonable period of time as set forth in the Fund s valuation policies and procedures, or if information furnished by a pricing service, in the opinion of the valuation committee ( Valuation Committee ), is deemed not representative of the fair value of such security, the Fund uses the fair value of the investment determined in accordance with the procedures described below. There can be no assurance that the Fund could obtain the fair value assigned to an investment if it sold the investment at approximately the time at which the Fund determines its NAV per share. Fair Valuation Procedures The Trustees have ultimate responsibility for determining the fair value of investments for which market quotations are not readily available. The Trustees have appointed a Valuation Committee comprised of officers of the Fund, Federated Investment Management Company ( Adviser ) and certain of the Adviser s affiliated companies to assist in determining fair value and in overseeing the calculation of the NAV. The Trustees have also authorized the use of 22

pricing services recommended by the Valuation Committee to provide fair value evaluations of the current value of certain investments for purposes of calculating the NAV. The Valuation Committee employs various methods for reviewing third-party pricing-service evaluations including periodic reviews of third-party pricing services policies, procedures and valuation methods (including key inputs, methods, models and assumptions), transactional back-testing, comparisons of evaluations of different pricing services, and review of price challenges by the Adviser based on recent market activity. In the event that market quotations and price evaluations are not available for an investment, the Valuation Committee determines the fair value of the investment in accordance with procedures adopted by the Trustees. The Trustees periodically review and approve the fair valuations made by the Valuation Committee and any changes made to the procedures. Factors considered by pricing services in evaluating an investment include the yields or prices of investments of comparable quality, coupon, maturity, call rights and other potential prepayments, terms and type, reported transactions, indications as to values from dealers and general market conditions. Some pricing services provide a single price evaluation reflecting the bid-side of the market for an investment (a bid evaluation). Other pricing services offer both bid evaluations and price evaluations indicative of a price between the prices bid and asked for the investment (a mid evaluation). The Fund normally uses bid evaluations for any U.S. Treasury and Agency securities, mortgage-backed securities and municipal securities. The Fund normally uses mid evaluations for any other types of fixed-income securities and any OTC derivative contracts. In the event that market quotations and price evaluations are not available for an investment, the fair value of the investment is determined in accordance with procedures adopted by the Trustees. Repurchase Agreements The Fund may invest in repurchase agreements for short-term liquidity purposes. It is the policy of the Fund to require the other party to a repurchase agreement to transfer to the Fund s custodian or sub-custodian eligible securities or cash with a market value (after transaction costs) at least equal to the repurchase price to be paid under the repurchase agreement. The eligible securities are transferred to accounts with the custodian or subcustodian in which the Fund holds a securities entitlement and exercises control as those terms are defined in the Uniform Commercial Code. The Fund has established procedures for monitoring the market value of the transferred securities and requiring the transfer of additional eligible securities if necessary to equal at least the repurchase price. These procedures also allow the other party to require securities to be transferred from the account to the extent that their market value exceeds the repurchase price or in exchange for other eligible securities of equivalent market value. The insolvency of the other party or other failure to repurchase the securities may delay the disposition of the underlying securities or cause the Fund to receive less than the full repurchase price. Under the terms of the repurchase agreement, any amounts received by the Fund in excess of the repurchase price and related transaction costs must be remitted to the other party. The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Fund s Adviser and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities. 23

Repurchase agreements are subject to Master Netting Agreements which are agreements between the Fund and its counterparties that provide for the net settlement of all transactions and collateral with the Fund, through a single payment, in the event of default or termination. Amounts presented on the Portfolio of Investments and Statement of Assets and Liabilities are not net settlement amounts but gross. As indicated above, the cash or securities to be repurchased, as shown on the Portfolio of Investments, exceeds the repurchase price to be paid under the agreement reducing the net settlement amount to zero. Investment Income, Gains and Losses, Expenses and Distributions Investment transactions are accounted for on a trade-date basis. Realized gains and losses from investment transactions are recorded on an identified-cost basis. Interest income and expenses are accrued daily. Dividend income and distributions to shareholders are recorded on the ex-dividend date. Distributions of net investment income, if any, are declared daily and paid monthly. Non-cash dividends included in dividend income, if any, are recorded at fair value. Investment income, realized and unrealized gains and losses, and certain fund-level expenses are allocated to each class based on relative average daily net assets, except that Class A Shares, Institutional Shares, Service Shares and Class R6 Shares may bear distribution services fees and other service fees unique to those classes. Amortization/accretion of premium and discount is included in investment income. Gains and losses realized on principal payment of mortgage-backed securities (paydown gains and losses) are classified as part of investment income. The detail of the total fund expense waivers and reimbursement of $2,257,767 is disclosed in various locations in this Note 2 and Note 5. For the year ended July 31, 2017, transfer agent fees for the Fund were as follows: Transfer Agent Fees Incurred Transfer Agent Fees Reimbursed Class A Shares $ 5,428 $ Institutional Shares 275,555 (120,745) Service Shares 170,052 (83,308) Class R6 Shares 165 TOTAL $451,200 $(204,053) Dividends are declared separately for each class. No class has preferential dividend rights; differences in per share dividend rates are generally due to differences in separate class expenses. Other Service Fees The Fund may pay other service fees up to 0.25% of the average daily net assets of the Fund s Class A Shares and Service Shares to unaffiliated financial intermediaries or to Federated Shareholder Services Company (FSSC) for providing services to shareholders and maintaining shareholder accounts. Subject to the terms described in the Expense Limitation note, FSSC 24

may voluntarily reimburse the Fund for other service fees. In addition, unaffiliated third-party financial intermediaries may waive other service fees. This waiver can be modified or terminated at any time. For the year ended July 31, 2017, other service fees for the Fund were as follows: Other Service Fees Incurred Class A Shares $ 23,840 Service Shares 282,868 TOTAL $306,708 Federal Taxes It is the Fund s policy to comply with the Subchapter M provision of the Internal Revenue Code and to distribute to shareholders each year substantially all of its income. Accordingly, no provision for federal income tax is necessary. As of and during the year ended July 31, 2017, the Fund did not have a liability for any uncertain tax positions. The Fund recognizes interest and penalties, if any, related to tax liabilities as income tax expense in the Statement of Operations. As of July 31, 2017, tax years 2014 through 2017 remain subject to examination by the Fund s major tax jurisdictions, which include the United States of America and the Commonwealth of Massachusetts. When-Issued and Delayed-Delivery Transactions The Fund may engage in when-issued or delayed-delivery transactions. The Fund records when-issued securities on the trade date and maintains security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed-delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract. Other The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, expenses and revenues reported in the financial statements. Actual results could differ from those estimated. The Fund applies investment company accounting and reporting guidance. 3. SHARES OF BENEFICIAL INTEREST The following table summarizes share activity: Year Ended July 31 2017 2016 Class A Shares: Shares Amount Shares Amount Shares sold 599,469 $ 5,886,020 482,462 $ 4,745,028 Shares issued to shareholders in payment of distributions declared 2,528 24,840 185 1,818 Shares redeemed (496,303) (4,875,214) (1,095,994) (10,775,923) NET CHANGE RESULTING FROM CLASS A SHARE TRANSACTIONS 105,694 $ 1,035,646 (613,347) $ (6,029,077) 25

Year Ended July 31 2017 2016 Institutional Shares: Shares Amount Shares Amount Shares sold 43,683,442 $ 431,361,732 56,850,223 $ 561,852,055 Shares issued to shareholders in payment of distributions declared 336,851 3,327,771 152,742 1,508,022 Shares redeemed (38,478,648) (379,856,808) (57,646,916) (569,693,540) NET CHANGE RESULTING FROM INSTITUTIONAL SHARE TRANSACTIONS 5,541,645 $ 54,832,695 (643,951) $ (6,333,463) Year Ended July 31 2017 2016 Service Shares: Shares Amount Shares Amount Shares sold 4,293,252 $ 42,376,206 5,057,784 $ 49,983,298 Shares issued to shareholders in payment of distributions declared 166,849 1,647,292 96,362 951,090 Shares redeemed (9,956,925) (98,292,423) (8,843,276) (87,326,230) NET CHANGE RESULTING FROM SERVICE SHARE TRANSACTIONS (5,496,824) $(54,268,925) (3,689,130) $(36,391,842) Year Ended July 31 2017 2016 1 Class R6 Shares: Shares Amount Shares Amount Shares sold 1,196,564 $11,818,640 12,913 $ 127,445 Shares issued to shareholders in payment of distributions declared 1,605 15,872 3 29 Shares redeemed (698,369) (6,896,688) (6,931) (68,407) NET CHANGE RESULTING FROM CLASS R6 SHARE TRANSACTIONS 499,800 $ 4,937,824 5,985 $ 59,067 NET CHANGE RESULTING FROM TOTAL FUND SHARE TRANSACTIONS 650,315 $ 6,537,240 (4,940,443) $(48,695,315) 1 Reflects operations for the period from March 29, 2016 (date of initial investment) to July 31, 2016. 4. FEDERAL TAX INFORMATION The tax character of distributions as reported on the Statement of Changes in Net Assets for the years ended July 31, 2017 and 2016, was as follows: 2017 2016 Ordinary income $5,266,692 $2,772,525 Long-Term Capital Gains $ 102,717 As of July 31, 2017, the components of distributable earnings on a tax-basis were as follows: Undistributed ordinary income $ 110,118 Undistributed long term capital gains $ 1,270 Net unrealized depreciation $(1,645,857) 26

At July 31, 2017, the cost of investments for federal tax purposes was $852,394,312. The net unrealized depreciation of investments for federal tax purposes was $1,645,857. This consists of net unrealized appreciation from investments for those securities having an excess of value over cost of $879,315 and net unrealized depreciation from investments for those securities having an excess of cost over value of $2,525,172. 5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES Investment Adviser Fee The advisory agreement between the Fund and the Adviser provides for an annual fee equal to 0.40% of the Fund s average daily net assets. Subject to the terms described in the Expense Limitation note, the Adviser may voluntarily choose to waive any portion of its fee. For the year ended July 31, 2017, the Adviser voluntarily waived $2,046,340 of its fee. Administrative Fee Federated Administrative Services (FAS), under the Administrative Services Agreement, provides the Fund with administrative personnel and services. For purposes of determining the appropriate rate breakpoint, Investment Complex is defined as all of the Federated Funds subject to a fee under the Administrative Services Agreement. The fee paid to FAS is based on the average daily net assets of the Investment Complex as specified below, plus certain out-of-pocket expenses: Average Daily Net Assets Administrative Fee of the Investment Complex 0.150% on the first $5 billion 0.125% on the next $5 billion 0.100% on the next $10 billion 0.075% on assets in excess of $20 billion Subject to the terms described in the Expense Limitation note, FAS may voluntarily choose to waive any portion of its fee. For the year ended July 31, 2017, the annualized fee paid to FAS was 0.078% of average daily net assets of the Fund. Distribution Services Fee The Fund has adopted a Distribution Plan (the Plan ) pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will compensate Federated Securities Corp. (FSC), the principal distributor, from the daily net assets of the Fund s Class A Shares and Service Shares to finance activities intended to result in the sale of these shares. The Plan provides that the Fund may incur distribution expenses at the following percentages of average daily net assets annually, to compensate FSC: Percentage of Average Daily Share Class Name Net Assets of Class Class A Shares 0.25% Service Shares 0.05% 27