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I'm not sure, what does the man page say? You could run a little test. When you know there are some NIS clients logged in, run the "who" program. It does exactly what I suggested, it reads the utmp file and prints the users.
Also, your daemon will not need to be a superuser to read this file, which will make it more secure. The last thing you want to do is open a hole in an important machine.
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