NOTES TO FINANCIAL STATEMENTS
Vanguard Bond Index Funds comprise the Total Bond Market Index Fund, Short-Term Bond Index Fund,
Intermediate-Term Bond Index Fund, and Long-Term Bond Index Fund, each of which is registered under the
Investment Company Act of 1940 as a diversified open-end investment company, or mutual fund. Certain of the
funds' investments are in corporate debt instruments; the issuers' abilities to meet their obligations may be affected
by economic developments in their respective industries.
A. The following significant accounting policies conform to generally accepted accounting principles for U.S.
mutual funds. The funds consistently follow such policies in preparing their financial statements.
1. SECURITY VALUATION: Bonds, and temporary cash investments acquired over 60 days to maturity, are
valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as
security prices, yields, maturities, and ratings), both as furnished by independent pricing services. Other
temporary cash investments are valued at amortized cost, which approximates market value. Securities for which
market quotations are not readily available are valued by methods deemed by the board of trustees to represent
2. FEDERAL INCOME TAXES: Each fund intends to continue to qualify as a regulated investment company
and distribute all of its income. Accordingly, no provision for federal income taxes is required in the financial
3. REPURCHASE AGREEMENTS: Each fund, along with other members of The Vanguard Group, transfers
uninvested cash balances into a pooled cash account, which is invested in repurchase agreements secured by
U.S. government securities. Securities pledged as collateral for repurchase agreements are held by a custodian
bank until the agreements mature. Each agreement requires that the market value of the collateral be sufficient to
cover payments of interest and principal; however, in the event of default or bankruptcy