- Quarterly Schedule of Portfolio Holdings of Registered Management Investment Company (N-Q)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file number 811-21158

 

Nuveen North Carolina Dividend Advantage Municipal Fund 3

(Exact name of registrant as specified in charter)

 

Nuveen Investments

        333 West Wacker Drive, Chicago, Illinois 60606         

(Address of principal executive offices) (Zip code)

 

Kevin J. McCarthy

Vice President and Secretary

        333 West Wacker Drive, Chicago, Illinois 60606         

(Name and address of agent for service)

 

Registrant's telephone number, including area code:         312-917-7700        

 

Date of fiscal year end:             5/31          

 

Date of reporting period:          8/31/11         

 

Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

 

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

 

 

 

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Item 1. Schedule of Investments

 

 

		Portfolio of Investments (Unaudited)
		Nuveen North Carolina Dividend Advantage Municipal Fund 3 (NII)
		August 31, 2011
Principal			Optional Call
Amount (000)		Description (1)	Provisions (2)	Ratings (3)	Value
		Consumer Staples – 2.9% (1.8% of Total Investments)
$    2,000		Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds,	5/12 at 100.00	BBB	$    1,673,060
		Series 2002, 5.500%, 5/15/39
		Education and Civic Organizations – 4.6% (2.9% of Total Investments)
750		Fayetteville State University, North Carolina, Limited Obligation Revenue Bonds, Student	4/21 at 100.00	AA+	742,328
		Housing Project, Series 2011, 5.000%, 4/01/43 – AGM Insured
		North Carolina Capital Facilities Financing Agency, Revenue Bonds, Duke University, Series 2001A:
330		5.125%, 10/01/26	10/11 at 100.00	AA+	330,518
95		5.125%, 10/01/41	10/11 at 100.00	AA+	95,280
200		North Carolina Capital Facilities Financing Agency, Revenue Bonds, Johnson and Wales	4/13 at 100.00	N/R	196,622
		University, Series 2003A, 5.000%, 4/01/33 – SYNCORA GTY Insured
705		University of North Carolina System, Pooled Revenue Refunding Bonds, Series 2002A, 5.000%,	10/12 at 100.00	A+	712,269
		4/01/27 – AMBAC Insured
500		University of North Carolina Wilmington, Certificates of Participation, Student Housing	6/16 at 100.00	A–	537,835
		Project Revenue Bonds, Series 2006, 5.000%, 6/01/21 – FGIC Insured
2,580		Total Education and Civic Organizations			2,614,852
		Energy – 1.7% (1.1% of Total Investments)
1,000		Virgin Islands Public Finance Authority, Refinery Facilities Revenue Bonds, Hovensa Coker	1/13 at 100.00	Ba2	994,800
		Project, Senior Lien Series 2002, 6.500%, 7/01/21 (Alternative Minimum Tax)
		Health Care – 25.0% (15.6% of Total Investments)
		Albemarle Hospital Authority, North Carolina, Health Care Facilities Revenue Bonds, Series 2007:
695		5.250%, 10/01/27	10/17 at 100.00	N/R	605,943
70		5.250%, 10/01/38	10/17 at 100.00	N/R	56,356
1,200		Charlotte-Mecklenberg Hospital Authority, North Carolina, Carolinas HealthCare System Revenue	1/18 at 100.00	AA–	1,175,544
		Bonds, Series 2008A, 5.000%, 1/15/47
500		Charlotte-Mecklenberg Hospital Authority, North Carolina, Health Care Refunding Revenue Bonds,	1/19 at 100.00	AA–	506,370
		Carolinas HealthCare System, Series 2009A, 5.250%, 1/15/39
1,000		Charlotte-Mecklenberg Hospital Authority, North Carolina, Health Care Revenue Bonds, Carolinas	1/21 at 100.00	AA–	1,012,490
		HealthCare System, Series 2011A, 5.250%, 1/15/42
580		Charlotte-Mecklenburg Hospital Authority, North Carolina, Healthcare System Revenue Bonds,	1/12 at 100.00	AA–	580,789
		Carolinas Healthcare System, Series 2001A, 5.000%, 1/15/31
520		Johnston Memorial Hospital Authority, North Carolina, Mortgage Revenue Bonds, Johnston	4/18 at 100.00	AA+	535,865
		Memorial Hospital Project, Series 2008A, 5.250%, 10/01/36 – AGM Insured
180		New Hanover County, North Carolina, Hospital Revenue Bonds, New Hanover Regional Medical	10/19 at 100.00	AA+	187,733
		Center, Series 2006B, 5.125%, 10/01/31 – AGM Insured
		North Carolina Medical Care Commission Health Care Facilities Revenue Bonds Novant Health
		Inc., Series 2010A:
2,000		5.250%, 11/01/40	11/20 at 100.00	A+	1,990,960
500		5.000%, 11/01/43	11/20 at 100.00	A+	481,400
1,000		North Carolina Medical Care Commission, Health Care Facilities Refunding Revenue Bonds, Blue	1/20 at 100.00	A	932,030
		Ridge HealthCare, Series 2010A, 5.000%, 1/01/36
1,000		North Carolina Medical Care Commission, Health Care Facilities Revenue Bonds, Appalachian	7/21 at 100.00	BBB+	1,058,720
		Regional HealthCare System, Series 2011A, 6.500%, 7/01/31
1,000		North Carolina Medical Care Commission, Health Care Facilities Revenue Bonds, Cleveland County	1/21 at 100.00	A	1,017,970
		Healthcare System, Refunding Series 2011A, 5.750%, 1/01/35
545		North Carolina Medical Care Commission, Health Care Facilities Revenue Bonds, WakeMed, Series	10/14 at 100.00	AA+	559,366
		2009A, 5.625%, 10/01/38 – AGC Insured
2,000		North Carolina Medical Care Commission, Healthcare Facilities Revenue Bonds, Novant Health	11/13 at 100.00	A+	2,070,240
		Obligated Group, Series 2003A, 5.000%, 11/01/18
1,000		North Carolina Medical Care Commission, Hospital Revenue Bonds, Wilson Medical Center, Series	11/17 at 100.00	A–	1,000,460
		2007, 5.000%, 11/01/27
400		North Carolina Medical Care Commission, Revenue Bonds, Blue Ridge Healthcare System, Series	1/15 at 100.00	A	381,308
		2005, 5.000%, 1/01/33 – FGIC Insured
150		Northern Hospital District of Surry County, North Carolina, Health Care Facilities Revenue	4/18 at 100.00	BBB	150,551
		Bonds, Series 2008, 6.250%, 10/01/38
14,340		Total Health Care			14,304,095
		Housing/Multifamily – 1.8% (1.1% of Total Investments)
1,000		Mecklenburg County, North Carolina, FNMA Multifamily Housing Revenue Bonds, Little Rock	7/13 at 105.00	AA+	1,054,040
		Apartments, Series 2003, 5.150%, 1/01/22 (Alternative Minimum Tax)
		Housing/Single Family – 4.4% (2.7% of Total Investments)
550		North Carolina Housing Finance Agency, Home Ownership Revenue Bonds, 1998 Trust Agreement,	1/12 at 100.00	AA	550,259
		Series 5A, 5.625%, 7/01/30 (Alternative Minimum Tax)
480		North Carolina Housing Finance Agency, Home Ownership Revenue Bonds, Series 2007-29A, 4.800%,	1/17 at 100.00	AA	472,627
		7/01/33 (Alternative Minimum Tax)
1,000		North Carolina Housing Finance Agency, Home Ownership Revenue Bonds, Series 2011-1,	1/21 at 100.00	AA	1,009,060
		4.500%, 1/01/28
495		North Carolina Housing Finance Agency, Home Ownership Revenue Bonds, Series 25-A, 4.900%,	7/16 at 100.00	AA	488,892
		7/01/37 (Alternative Minimum Tax)
2,525		Total Housing/Single Family			2,520,838
		Long-Term Care – 1.6% (1.0% of Total Investments)
		North Carolina Medical Care Commission, Healthcare Facilities Revenue Bonds, Presbyterian
		Homes, Series 2006:
250		5.400%, 10/01/27	10/16 at 100.00	N/R	225,105
600		5.500%, 10/01/31	10/16 at 100.00	N/R	530,142
190		North Carolina Medical Care Commission, Revenue Bonds, Pines at Davidson, Series 2006A,	1/16 at 100.00	N/R	174,939
		5.000%, 1/01/36
1,040		Total Long-Term Care			930,186
		Materials – 0.4% (0.2% of Total Investments)
200		Columbus County Industrial Facilities and Pollution Control Financing Authority, North Carolina,	3/17 at 100.00	BBB	177,310
		Environmental Improvement Revenue Bonds, International Paper Company Project, Series 2007A,
		4.625%, 3/01/27
		Tax Obligation/General – 1.6% (1.0% of Total Investments)
300		North Carolina, General Obligation Bonds, Series 2004A, 5.000%, 3/01/22	3/14 at 100.00	AAA	325,401
550		Wake County, North Carolina, Limited Obligation Bonds, Series 2010, 5.000%, 1/01/37	1/20 at 100.00	AA+	582,423
850		Total Tax Obligation/General			907,824
		Tax Obligation/Limited – 31.7% (19.8% of Total Investments)
1,800		Catawba County, North Carolina, Certificates of Participation, Series 2004, 5.250%, 6/01/22 –	6/14 at 100.00	Aa2	1,895,238
		NPFG Insured
2,750		Charlotte, North Carolina, Certificates of Participation, Governmental Facilities Projects,	6/13 at 100.00	AA+	2,793,313
		Series 2003G, 5.000%, 6/01/33
575		Charlotte, North Carolina, Certificates of Participation, Transit Projects Phase 2, Series	6/18 at 100.00	AA+	593,803
		2008A, 5.000%, 6/01/33
800		Craven County, North Carolina, Certificates of Participation, Series 2007, 5.000%, 6/01/27 –	6/17 at 100.00	AA–	847,216
		NPFG Insured
3,000		Dare County, North Carolina, Certificates of Participation, Series 2002, 5.000%, 6/01/23 –	12/12 at 100.00	AA–	3,117,900
		AMBAC Insured
200		Harnett County, North Carolina, Certificates of Participation, Series 2009, 5.000%, 6/01/28 –	6/19 at 100.00	AA+	211,904
		AGC Insured
500		Lee County, North Carolina, Certificates of Participation, Public Schools and Community	4/14 at 100.00	AA+	532,950
		College, Series 2004, 5.250%, 4/01/20 – AGM Insured
200		Mecklenburg County, North Carolina, Certificates of Participation, Series 2009A, 5.000%, 2/01/27	No Opt. Call	AA+	215,714
1,000		North Carolina, Certificates of Participation, Repair and Renovation Project, Series 2004B,	6/14 at 100.00	AA+	1,066,420
		5.000%, 6/01/20
2,625		Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Series 2010A,	No Opt. Call	A+	569,809
		0.000%, 8/01/35
565		Raleigh, North Carolina, Certificates of Participation, Series 2007, 5.000%, 2/01/27	2/17 at 100.00	AA+	602,019
565		Rutherford County, North Carolina, Certificates of Participation, Series 2002, 5.000%,	9/12 at 101.00	A1	580,543
		9/01/21 – AMBAC Insured
1,000		Rutherford County, North Carolina, Certificates of Participation, Series 2007, 5.000%,	12/17 at 100.00	AA+	1,065,860
		12/01/27 – AGM Insured
1,200		Sampson County, North Carolina, Certificates of Participation, Series 2006, 5.000%, 6/01/34 –	6/17 at 100.00	AA+	1,231,548
		AGM Insured (UB)
1,785		Union County, North Carolina, Certificates of Participation, Series 2003, 5.000%, 6/01/20 –	6/13 at 101.00	Aa2	1,911,771
		AMBAC Insured
500		Wilmington, North Carolina, Certificates of Participation, Series 2008A, 5.000%, 6/01/29	6/18 at 100.00	AA	533,100
400		Wilson County, North Carolina, Certificates of Participation, School Facilities Project,	4/17 at 100.00	Aa3	420,948
		Series 2007, 5.000%, 4/01/25 – AMBAC Insured
19,465		Total Tax Obligation/Limited			18,190,056
		Transportation – 7.9% (5.0% of Total Investments)
500		Charlotte, North Carolina, Airport Revenue Bonds, Charlotte Douglas International Refunding	7/20 at 100.00	A+	509,440
		Series 2010A, 5.000%, 7/01/39
660		North Carolina State Ports Authority, Port Facilities Revenue Bonds, Senior Lien Series 2010A,	2/20 at 100.00	A3	677,992
		5.250%, 2/01/40
		North Carolina Turnpike Authority, Triangle Expressway System Revenue Bonds, Series 2009A:
260		5.500%, 1/01/29 – AGC Insured	1/19 at 100.00	AA+	280,446
1,155		5.750%, 1/01/39 – AGC Insured	1/19 at 100.00	AA+	1,229,417
		North Carolina Turnpike Authority, Triangle Expressway System Senior Lien Revenue Bonds,
		Series 2009B:
2,295		0.000%, 1/01/35 – AGC Insured	No Opt. Call	AA+	608,634
100		0.000%, 1/01/37 – AGC Insured	No Opt. Call	AA+	23,668
300		0.000%, 1/01/38 – AGC Insured	No Opt. Call	AA+	66,906
1,100		Raleigh Durham Airport Authority, North Carolina, Airport Revenue Bonds, Refunding Series	No Opt. Call	Aa3	1,149,082
		2010A, 5.000%, 5/01/36
6,370		Total Transportation			4,545,585
		U.S. Guaranteed – 21.4% (13.4% of Total Investments) (4)
200		Charlotte-Mecklenburg Hospital Authority, North Carolina, Healthcare System Revenue Bonds, DBA	1/15 at 100.00	AA+ (4)	230,712
		Carolinas Healthcare System, Series 2005A, 5.000%, 1/15/45 (Pre-refunded 1/15/15)
		Forsyth County, North Carolina, Certificates of Participation, Public Facilities and Equipment
		Project, Series 2002:
1,325		5.125%, 1/01/16 (Pre-refunded 1/01/13)	1/13 at 101.00	AA+ (4)	1,421,434
770		5.250%, 1/01/19 (Pre-refunded 1/01/13)	1/13 at 101.00	AA+ (4)	827,319
		Lincoln County, North Carolina, General Obligation Bonds, Series 2002A:
850		5.000%, 6/01/19 (Pre-refunded 6/01/12) – FGIC Insured	6/12 at 101.00	AA– (4)	889,253
900		5.000%, 6/01/20 (Pre-refunded 6/01/12) – FGIC Insured	6/12 at 101.00	AA– (4)	941,562
1,050		5.000%, 6/01/21 (Pre-refunded 6/01/12) – FGIC Insured	6/12 at 101.00	AA– (4)	1,098,489
920		North Carolina Capital Facilities Financing Agency, Revenue Bonds, Duke University, Series	10/11 at 100.00	Aaa	923,827
		2001A, 5.125%, 10/01/26 (Pre-refunded 10/01/11)
1,600		North Carolina Capital Facilities Financing Agency, Revenue Bonds, Duke University, Series	10/12 at 100.00	Aaa	1,684,784
		2002A, 5.125%, 7/01/42 (Pre-refunded 10/01/12)
500		North Carolina Medical Care Commission, Health System Revenue Bonds, Mission St. Joseph’s	10/11 at 101.00	AA (4)	507,135
		Health System, Series 2001, 5.250%, 10/01/31 (Pre-refunded 10/01/11)
500		North Carolina Medical Care Commission, Revenue Bonds, Northeast Medical Center, Series 2004,	11/14 at 100.00	Aa3 (4)	572,265
		5.000%, 11/01/24 (Pre-refunded 11/01/14)
400		Raleigh, North Carolina, General Obligation Bonds, Series 2002, 5.000%, 6/01/21	6/12 at 100.00	AAA	414,476
		(Pre-refunded 6/01/12)
1,435		Rutherford County, North Carolina, Certificates of Participation, Series 2002, 5.000%, 9/01/21	9/12 at 101.00	A1 (4)	1,516,422
		(Pre-refunded 9/01/12) – AMBAC Insured
		University of North Carolina System, Pooled Revenue Refunding Bonds, Series 2002A:
610		5.000%, 4/01/27 (Pre-refunded 10/01/12) – AMBAC Insured	10/12 at 100.00	N/R (4)	641,500
585		5.000%, 4/01/27 (Pre-refunded 10/01/12) – AMBAC Insured	10/12 at 100.00	N/R (4)	614,876
11,645		Total U.S. Guaranteed			12,284,054
		Utilities – 14.5% (9.1% of Total Investments)
150		North Carolina Eastern Municipal Power Agency, Power System Revenue Bonds, Series 2003F,	1/13 at 100.00	A–	157,275
		5.500%, 1/01/16
500		North Carolina Eastern Municipal Power Agency, Power System Revenue Bonds, Series 2005,	1/16 at 100.00	A–	564,895
		5.250%, 1/01/20 – AMBAC Insured
1,400		North Carolina Eastern Municipal Power Agency, Power System Revenue Bonds, Series 2009B,	1/19 at 100.00	A–	1,501,024
		5.000%, 1/01/26
		North Carolina Eastern Municipal Power Agency, Power System Revenue Refunding Bonds,
		Series 1993B:
1,210		5.500%, 1/01/17 – FGIC Insured	1/17 at 100.00	Baa1	1,213,352
25		6.000%, 1/01/22	No Opt. Call	A–	30,428
15		6.000%, 1/01/22 – FGIC Insured	No Opt. Call	Baa1	18,257
275		North Carolina Municipal Power Agency 1, Catawba Electric Revenue Bonds, Refunding Series	1/19 at 100.00	A	286,894
		2009A, 5.000%, 1/01/30
2,665		North Carolina Municipal Power Agency 1, Catawba Electric Revenue Bonds, Series 2003A,	1/13 at 100.00	A	2,808,031
		5.250%, 1/01/15 – AMBAC Insured
250		North Carolina Municipal Power Agency 1, Catawba Electric Revenue Bonds, Series 2008A,	1/18 at 100.00	A	288,053
		5.250%, 1/01/20
1,400		Wake County Industrial Facilities and Pollution Control Financing Authority, North Carolina,	2/12 at 101.00	A1	1,440,208
		Revenue Refunding Bonds, Carolina Power and Light Company, Series 2002, 5.375%, 2/01/17
7,890		Total Utilities			8,308,417
		Water and Sewer – 40.4% (25.3% of Total Investments)
2,000		Brunswick County, North Carolina, Enterprise System Revenue Bonds, Series 2008A, 5.000%,	4/18 at 100.00	AA+	2,097,580
		4/01/31 – AGM Insured
425		Cape Fear Public Utility Authority, North Carolina, Water & Sewer System Revenue Bonds, Series	8/18 at 100.00	AA	460,186
		2008, 5.000%, 8/01/28
		Dare County, North Carolina, Utilities System Revenue Bonds, Series 2011:
1,320		5.000%, 2/01/36	2/21 at 100.00	AA	1,408,268
500		5.000%, 2/01/41	2/21 at 100.00	AA	530,630
300		Durham County, North Carolina, Enterprise System Revenue Bonds, Series 2002, 5.000%, 6/01/18 –	6/13 at 100.00	AA	318,378
		NPFG Insured
3,050		Durham, North Carolina, Utility System Revenue Bonds, Refunding Series 2011, 5.000%, 6/01/41	6/21 at 100.00	AAA	3,287,687
2,500		Kannapolis, North Carolina, Water and Sewerage System Revenue Bonds, Series 2001B, 5.250%,	2/12 at 101.00	AA+	2,505,275
		2/01/26 – AGM Insured (Alternative Minimum Tax)
600		Oak Island, North Carolina, Enterprise System Revenue Bonds, Series 2008A, 5.000%, 6/01/23 –	6/18 at 100.00	A2	641,814
		NPFG Insured
		Oak Island, North Carolina, Enterprise System Revenue Bonds, Series 2009A:
50		6.000%, 6/01/34 – AGC Insured	6/19 at 100.00	AA+	54,499
20		6.000%, 6/01/36 – AGC Insured	6/19 at 100.00	AA+	21,732
300		Oak Island, North Carolina, Enterprise System Revenue Bonds, Series 2011, 5.750%, 6/01/36 –	6/21 at 100.00	AA+	323,778
		AGC Insured
500		Onslow County, North Carolina, Combined Enterprise System Revenue Bonds, Series 2004B, 5.000%,	6/14 at 100.00	A+	539,160
		6/01/23 – SYNCORA GTY Insured
		Raleigh, North Carolina, Combined Enterprise System Revenue Bonds, Series 2006A:
4,950		5.000%, 3/01/31 (UB)	3/16 at 100.00	AAA	5,281,106
3,000		5.000%, 3/01/36 (UB)	3/16 at 100.00	AAA	3,155,730
5		Raleigh, North Carolina, Combined Enterprise System Revenue Bonds, Series 2006A,	No Opt. Call	AAA	5,779
		Residuals Series 11-R-645-2, 13.706%, 3/01/14 (IF)
2,375		Winston-Salem, North Carolina, Water and Sewer System Revenue Bonds, Series 2007A, 5.000%,	6/17 at 100.00	AAA	2,526,501
		6/01/37 (UB)
21,895		Total Water and Sewer			23,158,103
$     92,800		Total Investments (cost $89,199,962) – 159.9%			91,663,212
		Floating Rate Obligations – (13.0)%			(7,480,000)
		MuniFund Term Preferred Shares, at Liquidation Value – (50.1)% (5)			(28,725,000)
		Other Assets Less Liabilities – 3.2%			1,872,756
		Net Assets Applicable to Common Shares – 100%			$    57,330,968

 

 

 

 

 

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Fair Value Measurements

 

Fair value is defined as the price that the Fund would receive upon selling an investment or transferring a liability in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. A three-tier hierarchy is used to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The three-tier hierarchy of inputs is 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.).

 

Level 3 – Significant unobservable inputs (including management’s assumptions in determining the fair value of investments).

 

The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of the Fund’s fair value measurements as of August 31, 2011:

 

	Level 1	Level 2	Level 3	Total
Investments:
Municipal Bonds	$ —	$91,663,212	$ —	$91,663,212

 

 

During the period ended August 31, 2011, the Fund recognized no significant transfers to or from Level 1, Level 2 or Level 3.

 

Income Tax Information

 

The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset value of the Fund.

 

At August 31, 2011, the cost of investments was $81,710,438.

 

Gross unrealized appreciation and gross unrealized depreciation of investments at August 31, 2011, were as follows:

 

Gross unrealized:
Appreciation	$3,016,916
Depreciation	(543,504)
Net unrealized appreciation (depreciation) of investments	$2,473,412

 

 

(1)		All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares
		unless otherwise noted.
(2)		Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There
		may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be
		subject to periodic principal paydowns.
(3)		Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc.
		(“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB
		by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of
		these national rating agencies.
(4)		Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities,
		which ensure the timely payment of principal and interest. Bonds backed by U.S. Government or agency
		securities are given an implied rating equal to the rating of such securities.
(5)		MuniFund Term Preferred Shares, at Liquidation Value as a percentage of Total Investments is 31.3%.
N/R		Not rated.
(IF)		Inverse floating rate investment.
(UB)		Underlying bond of an inverse floating rate trust reflected as a financing transaction.

 

 

 

 

 

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Item 2. Controls and Procedures.

a.

The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (17 CFR 240.13a-15(b) or 240.15d-15(b)).

 

 

b.

There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant's last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

 

Item 3. Exhibits.

File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)), exactly as set forth below: See EX-99 CERT attached hereto.

 

 

 

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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.

 

(Registrant)   Nuveen North Carolina Dividend Advantage Municipal Fund 3 

 

By (Signature and Title)     /s/ Kevin J. McCarthy                    

                                                   Kevin J. McCarthy

                                                   Vice President and Secretary

 

Date          October 28, 2011        

 

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 (Signature and Title)     /s/ Gifford R. Zimmerman                    

                                                    Gifford R. Zimmerman

                                                  Chief Administrative Officer (principal executive officer) 

 

Date          October 28, 2011        

 

By (Signature and Title)     /s/ Stephen D. Foy                              

                                                   Stephen D. Foy

                                                  Vice President and Controller (principal financial officer) 

 

Date          October 28, 2011