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 2007 and 2006, 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 management of the Foundation 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 audit 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 management of the Foundation, 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 2007 and 2006, 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 : 28 March 2008

	Note	2007	2006
ASSETS
CURRENT ASSETS
Cash and deposits at financial institutions		8,626,687	6,576,054
Current investments	4	11,499,308	17,022,674
Elephants	5	14,390,485	11,390,485
Other current assets
Receivables from lawsuits in respect of breach of contract		275,000	275,000
Interest receivable		256,344	308,039
Others		263,050	321,065
TOTAL CURRENT ASSETS		35,310,874	35,893,317
NON-CURRENT ASSETS
Long-term investment	4	13,530,027	7,485,939
Equipment - net	6	6,632,913	6,799,551
Deposit		30,000	30,000
TOTAL NON-CURRENT ASSETS		20,192,940	14,315,490
TOTAL ASSETS		55,503,814	50,208,807
LIABILITIES AND ACCUMULATED FUNDS
CURRENT LIABILITIES
Accrued expenses		134,366	71,799
Contribution awaiting transfer to provident fund		7,253	23,760
Others		38,269	25,973
TOTAL CURRENT LIABILITIES		179,888	121,532
ACCUMULATED FUNDS
Initial capital funds	7	776,911	776,911
Balance of funds		54,547,015	49,310,364
TOTAL ACCUMULATED FUNDS		55,323,926	50,087,275
TOTAL LIABILITIES AND ACCUMULATED FUNDS		55,503,814	50,208,807

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

	Note	2007	2006
REVENUES
Donations	8	14,123,767	13,059,576
Interest income		1,282,434	1,144,578
Other income		100	2,419
TOTAL REVENUES		15,406,301	14,206,573
EXPENSES
Administrative expenses		10,169,650	10,953,380
TOTAL EXPENSES		10,169,650	10,953,380
SURPLUS OF REVENUES TO EXPENSES FOR THE YEAR		5,236,651	3,253,193

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

	Accumulated funds
	Initial capital funds	Balance of funds	Total
Balance as at 31 December 2005	776,911	46,057,171	46,834,082
Surplus of revenues to expenses for the year	-	3,253,193	3,253,193
Balance as at 31 December 2006	776,911	49,310,364	50,087,275
Surplus of revenues to expenses for the year	-	5,236,651	5,236,651
Balance as at 31 December 2007	776,911	54,547,015	55,323,926

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

1. GENERAL INFORMATION
The Elephant Reintroduction Foundation (hereinafter refered to as "the 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 624 Yoawaraj Place Building, Room 209, Yaowaraj Road, Sampantawong, Bangkok 10100.

At present, the Foundation has 3 offices as follow:-
- The Bangkok office located on 624 Yoawaraj Place Building, Room 209, Yaowaraj Road, Sampantawong, Bangkok 10100.
- The Chiangmai office located at room D 206, 2nd floor Faculty of Veterinary Medicine, Chiangmai University, Mae Hiae, Muang, Chiangmai 50100.
- The Lopburi office located at Sab Langka Wildlife Sanctuary Area, Gudtaphet Sub-District, Lam Sonthi District, Lopburi, 15190..

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

2. ADOPTION OF NEW ACCOUNTING STANDARDS
The Federation of Accounting Professions (FAP) has issued Notifications No. 9/2550, 38/2550 and 62/2550 regarding Accounting Standards. The notifications mandate the use of the following new Accounting Standards.

2.1 Thai Accounting Standards which are effective for the year 2007

These accounting standards become effective for the financial statements for fiscal years beginning on or after 1 January 2007. However, these revised accounting standards are not relevant to the business of the Foundation.

2.2 Thai Accounting Standards which are not effective for the year 2007

hese accounting standards will become effective for the financial statements for fiscal years beginning on or after 1 January 2008. The management has assessed the effect of these revised accounting standards and believes that they will not have any significant impact on the financial statements for the year in which they are initially applied.

3. SIGNIFICANT ACCOUNTING POLICIES

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

3.2 Investments
Held to maturity debt investments are represented at amortized cost.

3.3 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 have been missing for over 1 year or die.

3.4 Equipment / depreciation
Equipment is stated at cost less accumulated depreciation. Depreciation is calculated by reference to cost on the 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

Depreciation is included in determining operating results.
No depreciation is provided for equipment under installation.

3.5 Employee benefits
Salary, wages and contributions to the social security fund and provident fund are recognised as expenses when incurred.

3.6 Corporate income tax
Under the Revenue Code, the Foundation is a public charity organization or institution under Notification of the Ministry of Finance (No.210) which is exempted from income tax.

3.7 Use of accounting estimates
Preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions in certain circumstances, affecting amounts reported in these financial statements and related notes. Actual results could differ from these estimates.

4. INVESTMENTS
At as 31 December 2007 and 2006, the balance of current investments and long-time investments consist of :-

These investments represent investment in private fund made under the private fund management agreement date 20 January 2005, which the Foundation entered into with an asset management company, assigning the asset management company to manage the Foundation's private fund ("the Fund") for investment in debt instruments. The asset management company is to receive a management fee and a fund custody fee at a certain percentage rate per annum of the net asset value of the Fund as stipulated in the agreement.

5. ELEPHANTS
At as 31 December 2007, elephants under care of the Foundation are listed as follow :-

During 2007, movements of elephants under care of the Foundation were as follow:

6. EQUIPMENT

(Unit : Baht)
	Mobile office	Furniture and fixtures	Computer and equipment	Vihicle and equipment	Equipment under installation	Others	Total
Cost:
31 December 2006	554,650	4,854,211	678,611	3,374,352	64,662	1,236,467	10,762,953
Acquisition using cash from donation/Transfer in	-	337,209	133,356	2,096,874	37,692	340,509	2,945,640
Donated/Write off	-	(38,327)	(38,592)	(1,081,953)	-	(256,221)	(1,415,093)
31 December 2007	554,650	5,153,093	773,375	4,389,273	102,354	1,320,755	12,293,500
Accumulated depreciation :
31 December 2006	192,266	1,546,166	325,347	1,400,240	-	499,383	3,963,402
Depreciation charged for the year	110,868	1,011,706	152,419	772,529	-	232,733	2,280,255
Accumulted depreciation of donated equipment/Write off	-	(26,141)	(38,799)	(395,359)	-	(122,771)	(583,070)
31 December 2007	303,134	2,531,731	438,967	1,777,410	-	609,345	5,660,587
Net book value :
31 December 2006	362,384	3,308,045	353,264	1,974,112	64,662	737,084	6,799,551
31 December 2007	251,516	2,621,362	334,408	2,611,863	102,354	711,410	6,632,913
Depreciation for the year
2006	2,064,435
2007	2,280,255

As at 31 December 2007, certain equipment items have been fully depreciated but are still in use. The original cost of those assets amounted to approximately Baht 0.21 million.

7. 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.

8. DONATIONS
The Foundation received the donations for the year ended 31 December 2007 and 2006 as listed below :-

9. EMPLOYEES AND RELATED COSTS

10. PROVIDENT FUND
The Foundation and its employees have jointly established a provident fund in accordance with the Provident Fund Act B.E. 2530. The Foundation contributed to the fund monthly at the rate of 5 - 10 percent of basic salary and employees contributed to the fund monthly at the rate of 5 percent of basic salary. The fund, which is managed by TISCO Asset Management Company Limited, will be paid to employees upon termination of their membership of the fund, in accordance with the fund rules. During the year 2006, the Foundation contributed Baht 86,887 (2006 : Baht 65,320) to the fund.

11. COMMITMENTS
As at December 2007, the Foundation has commitments regarding office building rental and service amounting Baht 0.15 million (2006 : Baht 0.15 million).

12. APPROVAL OF FINANCIAL STATEMENTS
These financial statements were authorised for issue by the Foundation's Authorised Directors on 28 March 2008.