To The Board of
Elephant Reintroduction Foundation

I have audited the balance sheets of The Elephant Reintroduction Foundation, a non-profit organisation, as at 31 December 2004 and 2003, the related statements of revenues and expenses and changes in fund balance for the years then ended. These financial statements are the responsibility of the Foundation's management as to their correctness and completeness of the presentation. My responsibility is to express an opinion on these financial statements based on my audits.

I conducted my audits in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the Foundation's management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The Elephant Reintroduction Foundation as at 31 December 2004 and 2003, and the results of its operations for the years then ended in accordance with generally accepted accounting principles.

Since The Elephant Reintroduction Foundation is a foundation which operates for the public benefit and not for profit, therefore changes have been made to the recognition of transactions and the reporting in the financial statements to make them appropriate to a non-profit organisation.

Siraporn Ouaanunkun
Certified Public Accountant (Thailand) No. 3844

Ernst & Young Office Limited
Bangkok : 15 February 2005

	Note	2004	2003
ASSETS
CURRENT ASSETS
Cash and deposits at financial institutions		30,523,175	47,993,307
Advance to employees		66,067	232,642
Elephants	3	3,425,600	-
Other current assets		30,068	30,068
TOTAL CURRENT ASSETS		34,167,880	48,256,017
NON-CURRENT ASSETS
Long-term investment	4	6,000,000	-
Equipment - net	5	4,124,023	1,451,074
Deposit and advance paid for purchase of fixed assests		875,101	-
TOTAL NON-CURRENT ASSETS		10,999,124	1,451,074
TOTAL ASSETS		45,167,004	49,707,091
LIABILITIES AND ACCUMULATED FUNDS
CURRENT LIABILITIES
Accrued expenses		101,313	98,630
Contribution awaiting transfer to provident fund		270,579	139,133
Other current liabilities		23,944	20,270
TOTAL CURRENT LIABILITIES		395,836	258,033
ACCUMULATED FUNDS
Initial capital funds	6	776,911	776,911
Balance of funds		43,994,257	48,672,147
TOTAL ACCUMULATED FUNDS		44,771,168	49,449,058
TOTAL LIABILITIES AND ACCUMULATED FUNDS		45,167,004	49,707,091

The accompanying notes are an integral part of the financial statements.

	Note	2004	2003
REVENUES
Donations	7	2,044,157	50,075,145
Interest income		426,527	489,751
Other income		1,440	6,720
TOTAL REVENUES		2,472,124	50,571,616
EXPENSES
Administrative expenses		7,150,014	4,465,291
TOTAL EXPENSES		7,150,014	4,465,291
SURPLUS (DEFICIT) OF REVENUES TO EXPENSES FOR THE YEAR		(4,677,890)	46,106,325

The accompanying notes are an integral part of the financial statements.

	Accumulated funds
	Initial capital funds	Balance of funds	Total
Initial capital funds from donations (Note 4)	776,911	2,565,822	3,342,733
Surplus of revenues to expenses for the period	-	46,106,325	46,106,325
Balance as at 31 December 2003	776,911	48,672,147	49,449,058
Surplus of revenues to expenses for the year	-	(4,677,890)	(4,677,890)
Balance as at 31 December 2004	776,911	43,994,257	44,771,168

The accompanying notes are an integral part of the financial statements.

1. GENERAL INFORMATION
The Elephant Reintroduction Foundation was incorporated as a foundation under Thai laws on 9 August 2002. The main objectives of the Foundation are to return elephants to the wild in cooperation with other organisations to conserve Thai elephants, to act for the public benefit, to operate not for profit and to the exclusion of political action. Its registered address is 7th floor, Parking Building, Toursim Authority of Thailand, 10600 New Petchaburi Road, Makkasan, Rajchathewi, Bangkok 10400.

At present, the Foundation has 2 offices as follow:-
- The Bangkok office located on 7th floor, Parking Building, Tourism Authority of Thailand, 1600 New Petchaburi Road, Makkasan, Rajchathewi, Bangkok 10400.
- The Chiangmai office located at room D 206, 2nd floor Faculty of Veterinary Medicine, Chiangmai University, Mae Hiae, Muang, Chiangmai 50100.

On 14 March 2003, the Ministry of Finance announced The Elephant Reintroduction Foundation had been listed as public charity organisation or institution No. 508 under Notification of the Ministry of Finance (No. 210).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Significant accounting policies adopted by The Elephant Reintroduction Foundation (hereinafter referred to as "the Foundation") are summarised below:-

2.1 Accrual basis
The financial statements have been generally prepared on an accrual basis.

2.2 Elephants
Elephants purchased using cash from donation are stated at cost.
Elephants acquired through donations are recorded at their fair value, which is evaluated by specialist of the Foundation.
Elephants are written off from the Foundation's balance sheets when they are offically released to their natural habitat.

2.3 Equipment / depreciation
Equipment is stated at cost less accumulated depreciation. Depreciation is calculated by reference to cost on a straight-line basis over the following estimated useful lives :-

Mobile Office	-	5	Years
Furniture and fixtures	-	5	Years
Computer and equipment	-	5	Years
Vehicle and equipment	-	5	Years
Other	-	5	Years

No depreciation is provided for equipment under installation.

2.4 Corporate income tax
Under the Revenue Code, the Foundation is a public charity organization or institution under Notification of the Ministry of Finance which is exempted from income tax.

2.5 Use of accounting estimates
Preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates for certain accounting transactions, affecting amounts reported in the financial statements and notes related thereto. Subsequent actual results may differ from these estimates.

3. ELEPHANTS
At as 31 December 2004, elephants under care of the Foundation are listed as follow :-

5. EQUIPMENT - NET

(Unit : Baht)
	Mobile office	Furniture and Fixtures	Computer and equipment	Vihicle and equipment	Equipment under installation	Others	Total
Cost:
31 December 2003	-	426,279	264,799	864,206	-	148,204	1,703,488
Additional fixed assets from donations	-	19,900	295,110	-	-	-	315,010
Acquisition using cash from donations	373,150	283,592	26,700	706,838	1,185,543	563,769	3,139,592
Disposal by donation	-	-	(204,370)	(85,646)	-	-	(290,016)
31 December 2004	373,150	729,771	382,239	1,485,398	1,185,543	711,973	4,868,074
Accumulated depreciation :
31 December 2003	-	47,557	55,517	147,445	-	1,895	252,414
Depreciation charged for the year	27,383	123,019	78,355	232,813	-	59,794	521,364
Disposal by donation	-	-	(6,885)	(22,842)	-	-	(29,727)
31 December 2004	27,383	170,576	126,987	357,416	-	61,689	744,051
Net book value :
31 December 2003	-	378,722	209,282	716,761	-	146,309	1,451,074
31 December 2004	345,767	559,195	255,252	1,127,982	1,185,543	650,284	4,124,023
Depreciation charged to statement of revenues and expenses for the year ended 31 December
2004	521,364
2003	252,414

6. INITIAL CAPITAL FUNDS
Initial capital funds consists of cash donations of approximately Baht 0.50 million and fixed assets of approximately Baht 0.27 million donated by WWF Thailand Programme office.

7. DONATIONS
The Foundation received the donations for the year ended 31 December 2004 and 2003 as listed below :-

8. EMPLOYEES AND RELATED COSTS

9. APPROVAL OF FINANCIAL STATEMENTS
These financial statements have been approved by the Foundation Board Members.