The following is a good article from Rutgers University on how to use mulches in the landscape.
Although the mulching of trees and shrubs is an important plant health care practice, their effects can sometimes produce unexpected consequences. Different mulching materials should influence supplemental fertilizer practices. Nitrogen fertilizers can be applied to help reduce nitrogen immobilization where wood pallet or hardwood bark is found. Alternatively, where plants are growing in composted mulches, nitrogen application rates need to be adjusted to avoid over-stimulation. Over fertilization, especially with high nitrogen, may decrease mycorrhizae. It is most important to use these products when trees are first planted.
If raw or fresh mulches are used, they are best applied in the late fall or winter in order to reduce their initial negative effects on plant growth and health. As soon as the organic matter is partially decomposed and the competition for nutrients begins among soil microorganisms, then the beneficial effects can begin. Composted leaf and twig litter are best because they will support the growth of mycorrhizae. In natural forests where there is decaying leaf litter, the non-woody roots, and especially mycorrhizae, will be abundant in the highly organic top layer of soil. In cities, more composted wood and leaves should be added in correct quantities to soil about the base of trees.
Information from Steven K. Rettke, Ornamental IPM Program Associate in the September 17, 2009 edtion of the Plant & Pest Advisory, Landscape, Nursery & Turf Edition, from Rutgers University http://njaes.rutgers.edu/pubs/plantandpestadvisory/2009/ln091709.pdf