• Auditors' Report
• Balance Sheet

Notes to Balance Sheet

Note 1 Principal activities
Note 2 Basis of presentation 
Note 3 Principal accounting policies
Note 4 Reserves for losses
Note 5 Taxation
Note 6 Asset and liability maturities
Note 7 Currency denominations of assets and liabilities
Note 8 Cash and due from National Bank
Note 9 Loans and advances to credit institutions
Note 10 Loans to customers
Note 11 Tangible fixed assets
Note 12 Share capital
Note 13 Reserves
Note 14 Related parties
Note 15 Financial commitments and contingencies
Note 16 Capital adequacy

We have audited the accompanying balance sheet of Bank of Baku (the "Bank") as of 31 December 1997. This balance sheet is the responsibility of the Banks management. Our responsibility is to express an opinion on the balance sheet based on our audit.

We conducted our audit in accordance with International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the balance sheet is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the balance sheet. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall balance sheet presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the balance sheet referred to above gives a true and fair view of the financial position of the Bank as of 31 December 1997 in accordance with International Accounting Standards.

Baku, Azerbaijan 12 January 1998