We have audited the balance sheets of Rama IX Art Museum Foundation as at December 31, 2003 and 2002 and the related statements of income and expenditure and changes in funds' equity 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. Our responsibility is to express an opinion on these financial statements based on our audits.

Except as discussed in the third paragraph, we conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance as to 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 management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 4.4 to the financial statements, value of donated artworks estimated by the individual artists as at December 31, 2003 and 2002 was Baht 15.85 million and Baht 15.60 respectively. We were unable to satisfy ourselves as to the value of the artworks by means of other auditing procedure because there was no market price for comparison.

In our opinion, except for the effect of adjustment on the financial statements for 2003 and 2002, which might have been determined to be necessary, had we been able to audit the value of donated artworks as discussed in the third paragraph, the financial statements referred to in the first paragraph present fairly, in all material respects, the financial position of Rama IX Art Museum Foundation as at December 31, 2003 and 2002 and the income and expenditure and changes in funds' equity for the years then ended in conformity with generally accepted accounting principles.

BANGKOK
May 10, 2004

Thaveekiarti Krishnamra
Certified Public Accountant (Thailand)
Registration No. 104
DELOITTE TOUCHE TOHMATSU JAIYOS AUDIT CO., LTD.

1.1 To manage the Project of Art Exhibition in the honor of His Majesty King Bhumibol Adulyadej, the Supreme Artist, in Art and Culture, commemoration of the 50th anniversary of His Majesty The King’s accession to the throne.

1.2 To be responsible to fund raising in order to build up and manage a modern art museum to be named in the honor of His Majesty The King.

1.3 To support and develop knowledge of art. To collect and promote Thai artworks in the country and throughout the other countries around the world.

1.4 To promote and support the attitude to preserve the Thai contemporary art.

1.5 To organize a quality art publishing house concentrating in conventional publications and electronic educational aids for further understanding of Thai contemporary arts and to support and develop artistical knowledge.

1.6 To organize with other non-profit organization, education institution, art activities and others which have its same objectives in order to stimulate more grants and funding for public and young artists.

1.7 To encourage local and international artistic and cultural collaborations in order to support objectives of the foundation.

2. FUNDING POLICIES

The Foundation was established with the initial funds of Baht 200,000. The Foundation may raise additional funds as follows:.

2.1 Funds provided by Governmental organizations or state enterprises, or others in the country.

2.2 Funds or properties donated by charitable persons or organizations in the country or abroad.

2.3 Fund or properties bequeathed under a will or other juristic acts, provided that there are no conditions obligating the Foundation to any liabilities or whatsoever.

2.4 Interest and dividends arising from funds and the property which constitute the assets of the Foundation.

2.5 Contributions from the usage of the property or facilities of the Foundation, or services provided by the Foundation with free of charge.

2.6 Other income from the Foundation's activities.

3. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The Foundation prepares its statutory financial statements in the Thai language in conformity with accounting standards and practices generally accepted in Thailand.

The financial statements are presented in accordance with the Notification of the Department of Commrcial Registration (currently the Department of Business Development) dated September 14, 2001 regarding "The Brief Particulars in the Financial Statements B.E.2544".

According to the Notification No. 47 (B.E. 2545) issued by the Board of Supervision of Auditing Practices re: Exemption of Accounting Standards, the Foundation has elected to adopt the exemption related to the application of Thai Accounting Standard (TAS) No.25 "Cash Flow Statements" and TAS No. 48 " Financial Instruments : Disclosure and Pesentation".

4. SIGNIFICANT ACCOUNTING POLICIES

4.1 Income and expenditure recognition
Income and expenditure are recognized on an accrual basis, except for income from donation, which is recognized on cash basis.

4.2 Supplies are stated at cost which is calculated on an average basis.

4.3 Equipment is stated at cost.
Depreciation is calculated by the straight-line method, based on the estimated useful lives of the assets as follows:
Exhibition equipment 5 years
Office equipment 5 years
For office equipment, which was transferred from the Golden Jubilee Art Celebration, depreciation is based on its remaining life.

4.4 The artworks transferred from the Golden Jubilee Art Celebration as well as donated by artists, are estimated by individual artists.

5. SUPPLIES

Supplies consist of the following :

The above mentioned loan is provided by the Office of the National Culture Commission to support the production of 200 sets of Art in the Reign of Rama IX Books in the Golden Jubilee Art Celebration. There is no interest charge for the period of one year from March 1, 1997 to February 28, 1999. Failure to meet debt repayment schedule will result in a penalty charge of 15% per annum of the overdue amount.

Such loan is under personal guaranty of'members of the Board of Directors. Lender has the rights to call back part or the whole amount of loan before its maturity. Debt repayment must be made within 30 days from the date receiving notice from the lender.

The Foundation did not repay debt due in full. However, the Foundation has recorded penalty on failing to repay debt on schedule for the years ended December 31, 2000.

In 2000, the Foundation was negotiating to decrease penalty on failure to repay such loan with the National Culture Commission. Subsequently, during 2001, the Foundation has negotiated to decrease such penalty. The Foundation will make repayment of such loan with penalty and fine amounting to Baht 623,801 on May 21, 2003.