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<SEC-DOCUMENT>0000088053-05-001122.txt : 20050907
<SEC-HEADER>0000088053-05-001122.hdr.sgml : 20050907
<ACCEPTANCE-DATETIME>20050907114339
ACCESSION NUMBER:		0000088053-05-001122
CONFORMED SUBMISSION TYPE:	N-CSR
PUBLIC DOCUMENT COUNT:		32
CONFORMED PERIOD OF REPORT:	20050630
FILED AS OF DATE:		20050907
DATE AS OF CHANGE:		20050907
EFFECTIVENESS DATE:		20050907

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			KOREA FUND INC
		CENTRAL INDEX KEY:			0000748691
		IRS NUMBER:				133226146
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		N-CSR
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-04058
		FILM NUMBER:		051072088

	BUSINESS ADDRESS:	
		STREET 1:		345 PARK AVE
		STREET 2:		C/O DEUTSCHE ASSET MANAGEMENT
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10154
		BUSINESS PHONE:		617-295-3986

	MAIL ADDRESS:	
		STREET 1:		DEUTSCHE ASSET MANAGEMENT
		STREET 2:		TWO INTERNATIONAL FUND
		CITY:			BOSTON
		STATE:			MA
		ZIP:			02110
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-CSR
<SEQUENCE>1
<FILENAME>kor.htm
<DESCRIPTION>ANNUAL REPORT
<TEXT>
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<PRE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                                   FORM N-CSR

Investment Company Act file number 811-4058

                              THE KOREA FUND, INC.
                        --------------------------------
               (Exact Name of Registrant as Specified in Charter)

                                 345 Park Avenue
                            New York, New York 10154
                 ----------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

        Registrant's Telephone Number, including Area Code: (212) 454-7190
                                                            --------------

                                  Paul Schubert
                                 345 Park Avenue
                               New York, NY 10154
                     ---------------------------------------
                     (Name and Address of Agent for Service)

Date of fiscal year end:        06/30

Date of reporting period:       06/30/05

<PAGE>

ITEM 1.  REPORT TO STOCKHOLDERS

</PRE>

<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_49">
<TR>
<TD ID="ID_1548" ALIGN="LEFT" VALIGN="TOP" COLSPAN="3">
<P ALIGN="LEFT"><FONT SIZE="+3" COLOR="#3300d9">The Korea Fund, Inc.</FONT>
</P>
<H1 ALIGN="LEFT"><FONT COLOR="#3300d9">Annual Report to Stockholders</FONT></H1>
<H1 ALIGN="LEFT"><FONT COLOR="#3300d9">June 30, 2005</FONT></H1>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">A closed-end investment company seeking long-term&nbsp;capital appreciation
through investment in&nbsp;Korean securities.</FONT>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_48">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne300.gif" ALT="kor_NEW_SECTION300"></TD>
<TD ID="ID_1545" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">The Korea Fund, Inc.</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1510" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1509" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Investment Objective and Policies</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  long-term capital appreciation through investment in Korean securities</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Investment Characteristics</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  a closed-end investment company investing in a broad spectrum of Korean
securities</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  first United States investment company authorized to invest in Korean securities</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  a vehicle for international diversification through participation in the stock market</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  a vehicle providing investments in some less liquid Korean opportunities</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_47">
<TR>
<TD ID="ID_1508" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_26">
<TR>
<TD ID="ID_1468" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Executive Offices</H3>
</TD>
<TD ID="ID_1523" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">The Korea Fund, Inc.<BR>
345 Park Avenue<BR>
New York, NY 10154</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1467" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Automated <BR>
Information Line</H3>
</TD>
<TD ID="ID_1522" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">Scudder Closed-End Fund Info Line<BR>
1-800-349-4281</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1466" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Web Site</H3>
</TD>
<TD ID="ID_1521" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">www.TheKoreaFund.com</H3>
<P ALIGN="LEFT"><FONT COLOR="#000000">or visit our Direct Link:</FONT>
</P>
<H3 ALIGN="LEFT">www.CEF.Scudder.com</H3>
<P ALIGN="LEFT"><FONT COLOR="#000000">Obtain monthly fact sheets, financial reports,
press releases and webcasts when available.</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1463" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Transfer Agent and Registrar</H3>
</TD>
<TD ID="ID_1519" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">Scudder Investments Service Company<BR>
P.O. Box 219066<BR>
Kansas City, MO 64121-9066</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">For account information: 1-800-294-4366</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1462" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Dividend Reinvestment <BR>
Plan Agent</H3>
</TD>
<TD ID="ID_1517" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">UMB Bank, N.A.</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1461" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Legal Counsel</H3>
</TD>
<TD ID="ID_1516" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">Debevoise &amp; Plimpton LLP</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1460" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Custodian</H3>
</TD>
<TD ID="ID_1515" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">Brown Brothers Harriman &amp; Co.</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1459" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Subcustodian </H3>
</TD>
<TD ID="ID_1514" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">Citibank Korea Inc.</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1458" ALIGN="LEFT" VALIGN="TOP">
<H3 ALIGN="LEFT">Independent Registered
Public&nbsp;Accounting Firm</H3>
</TD>
<TD ID="ID_1513" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">PricewaterhouseCoopers LLP</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1457" ALIGN="LEFT" VALIGN="TOP" COLSPAN="2">
<H3 ALIGN="LEFT">New York Stock Exchange Symbol &#151; KF</H3>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_46">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne2e0.gif" ALT="kor_NEW_SECTION2E0"></TD>
<TD ID="ID_1544" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">Contents</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1507" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1506" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_25">
<TR>
<TD ID="ID_1412" ALIGN="LEFT" VALIGN="TOP" COLSPAN="3">
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#pl">Click Here</A></FONT><FONT COLOR="#000000">        A Discussion with the Chairman of the Board</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#letter">Click Here</A></FONT><FONT COLOR="#000000">   Portfolio Management Review</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#other">Click Here</A></FONT><FONT COLOR="#000000">    Other Information</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#invsum">Click Here</A></FONT><FONT COLOR="#000000">   Investment Summary</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#portsum">Click Here</A></FONT><FONT COLOR="#000000">  Portfolio Summary</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#portfolio">Click Here</A></FONT><FONT COLOR="#000000">        Investment Portfolio</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#fins">Click Here</A></FONT><FONT COLOR="#000000">     Financial Statements</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#high">Click Here</A></FONT><FONT COLOR="#000000">     Financial Highlights</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#notes">Click Here</A></FONT><FONT COLOR="#000000">    Notes to Financial Statements</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#ria">Click Here</A></FONT><FONT COLOR="#000000">      Report of Independent Registered Public Accounting Firm</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#tax">Click Here</A></FONT><FONT COLOR="#000000">      Tax Information</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#drip">Click Here</A></FONT><FONT COLOR="#000000">     Dividend Reinvestment and Cash Purchase Plan</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#3300d9">  <A HREF="#do">Click Here</A></FONT><FONT COLOR="#000000">       Directors and Officers</FONT>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_27">
<TR>
<TD ID="ID_1452" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Investments in funds involve risks. The fund focuses its investments in Korean issuers,
thereby increasing its vulnerability to developments in Korea and its geographic regions.
Investing in foreign securities presents certain unique risks not associated with domestic
investments, such as currency fluctuation and political and economic changes and
market risks. This may result in greater share price volatility. Shares of closed-end funds
frequently trade at a discount to net asset value. The price of the fund's shares is
determined by a number of factors, several of which are beyond the control of the fund.
Therefore, the fund cannot predict whether its shares will trade at, below or above net
asset value.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">This report is sent to the stockholders of The Korea Fund, Inc. for their information. It is not a
prospectus, circular, or representation intended for use in the purchase or sale of shares of the fund
or of any securities mentioned in the report.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Fund shares are not FDIC-insured and are not deposits or other obligations of, or guaranteed by, any
bank. Fund shares involve investment risk, including possible loss of principal.</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_45">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="korne2d0.gif" ALT="kor_NEW_SECTION2D0"></TD>
<TD ID="ID_1543" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="pl" ID="pl"></A>A Discussion with the Chairman of the Board</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1505" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1504" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><FONT SIZE="-1" COLOR="#000000">In the following interview, Chairman of the Board, Mr. Robert J. Callander, reviews
the actions taken by the Board of Directors of The Korea Fund, Inc. during the
twelve-month period ended June 30, 2005. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;How do you assess the year's results?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">For the year ended June 30, 2005, the net asset value
(NAV) total return of The Korea Fund was 38.66%. On a
market-value basis, the total return, i.e., percentage gain in
the share price plus dividend yield, was 49.06%, with the
share price on the New York Stock Exchange (NYSE)
closing at $27.35 per share. This represented a discount of
- -6.01% to NAV on June 30, 2005. The KOSPI, against
which the fund is measured, produced a total return
43.31% over the year ended June&nbsp;30, 2005.<FONT SIZE="-1"><SUP>1</SUP></FONT> (Please see
page <A HREF="#invsum">27</A> for more complete performance information. Past
performance is not indicative of future results.)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><SUP>1</SUP><I> KOSPI is an unmanaged capitalization-weighted index of all common shares on the Stock Market
Division of the Korea Exchange (formerly the &quot;Korea Stock Exchange&quot;). The index is calculated
using closing local market prices and converts to US dollars using the London close foreign
exchange rates. Index returns, unlike Fund returns, do not reflect any fees or expenses. It is not
possible to invest directly into an index.</I></FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;What actions has the Board taken to enhance value
for shareholders?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">Last December, the Board of Directors of The Korea
Fund, all of whom are independent directors, announced
several major actions designed to promote the interests
of&nbsp;<U>all</U> shareholders. The Board reviewed key aspects of
the&nbsp;fund's structure and operations, including the
discount&nbsp;from net asset value&nbsp;to market price,&nbsp;the fund's
investment policies and performance and its management
arrangement. As a result, the Board approved a series of
measures designed to enhance shareholder value. The
measures included an offer to repurchase 50% of the
fund's outstanding shares in exchange for portfolio
securities, a plan for future repurchase offers if the fund
trades at a discount over 5% in the future, and a reduction
in the fund's management fee. The actions resulted in the
discount narrowing from -12.53% on June 30, 2004 to
- -6.01% on June 30, 2005 and a management fee
reduction of approximately 42%. The Board of Directors
is committed to monitoring the discount and the fund's
overall investment results. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;Has there been any change to the fund's portfolio
management team?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">Terrence S. Gray became the fund's lead portfolio
manager after John J. Lee tendered his resignation from
the fund's Investment Manager on April 19, 2005. The
day-to-day management of the fund's portfolio will
continue to be handled by a team of investment
professionals at the Investment Manager's offices in New
York and Asia, including Mr. Gray. Mr. Gray is a director
of Deutsche Asset Management and head of the global
portfolio selection team for Pacific Basin Equities in
New&nbsp;York. Mr. Gray joined Deutsche Asset Management
in 1993, covering global emerging markets and Pacific
Basin markets in various capacities. He served as an Asian
country and sector analyst before joining the emerging
markets team, and has served as portfolio manager for
Alpha Emerging Markets Equity since 2003 and lead
portfolio manager for the Scudder New Asia Fund since
2001. After the departure in 2004 of a number of
individuals who each devoted a portion of their time to
The Korea Fund, the head of equities in Korea remains in
place and a new analyst devoted entirely to the fund has
been added to the team on the ground in Korea. Mr. Gray
and the portfolio management team will be making
certain changes in the fund's investment process to address
the challenges of investing in the evolving Korean market
and the increasingly global marketplace. Mr. Gray
discusses these changes in more detail in the Portfolio
Management Discussion. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;The Board of Directors also reviewed the
management contract with Deutsche Investment
Management (DeAM). What factors led to the Board's
decision to continue its current relationship with DeAM?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">At the last Annual Shareholders Meeting, a shareholder
proposal to terminate your fund's existing management
contract garnered significant support, although it failed
to&nbsp;achieve the necessary votes to pass. Shortly following
the meeting and after considering the views expressed by
a&nbsp;number of major shareholders of the fund, the Board
decided to conduct a comprehensive review of the fund's
management arrangements. The Board engaged an
independent consultant to assist in the process of
identifying and evaluating prospective managers. Drawing
on various industry resources and suggestions made
by&nbsp;all&nbsp;directors, this consultant compiled a list of
approximately 30 potential candidates. The Board then
invited 15&nbsp;candidates (including DeAM) to submit formal
proposals for the management of the fund. These
candidates were selected primarily on the basis of their
demonstrated experience in managing larger size portfolios
of Korean equities and in operating publicly held funds in
compliance with US investment company regulations.
Following analysis and discussion of written submissions,
the Board met in person with six final candidates,
including DeAM. The review focused on the historical
performance records of these candidates, as well as on the
ability of their investment processes to address the future
challenges of investing in a Korean market that is
assuming greater importance in the global economy.
The&nbsp;review also focused on the ability of each candidate
to&nbsp;handle all aspects of the administrative operations of
the fund, including particularly compliance with
regulatory requirements.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Following a series of in-person and telephonic meetings of
the Board, the Directors unanimously decided that
continuation of the fund's existing relationship with
DeAM was in the best interests of shareholders at this
time. In reaching this decision, the Board considered the
recent changes in the fund's management team and the
changes in investment process that will accompany this
change in personnel. We were encouraged that the new
team appeared well-positioned to address the challenges of
investing in the evolving Korean market, giving due
attention to both larger and smaller cap companies. We
also considered the important administrative services
provided to the fund by DeAM and its long history of
successful management of closed-end fund operations. In
this regard, we noted particularly the important role of
DeAM in effectively implementing the 50% tender offer
that was also announced last December and that is
expected to be completed in August, unless extended.
We&nbsp;also noted the substantial reduction in management
fees volunteered by DeAM and implemented as of
December&nbsp;1, 2004. In all these respects, we have found
the current manager to be responsive to the priorities
established by the Board to promote the interests of
all&nbsp;shareholders. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;Did the Board consider changes to the fund's
investment objective and policies as part of its review?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">The Board discussed the fund's investment objectives
and policies, including the fund's use of the KOSPI as its
benchmark, with all prospective candidates for manager.
All the finalists stated that they consider the KOSPI to be
the most appropriate benchmark for the fund. The Board
also considered assigning a portion of the portfolio to an
index manager or a manager focused exclusively on
small-cap stocks. It concluded, however, that a single
active manager pursuing the current objectives and
policies of the fund provided the maximum flexibility to
pursue all available investment opportunities in the
Korean market. At the same time, the Board remains
committed to continuing to monitor the performance of
the fund and will take appropriate action, if necessary, in
the interest of shareholders.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;What is the purpose of the tender offer and how will
it impact the fund?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">For many years the Board has sought to address the
discount to net asset value at which the fund's shares have
traded, in ways consistent with the best interests of all
shareholders and applicable regulatory requirements. The
Board has discussed and considered various alternative
strategies to address the discount, including instituting a
managed dividend policy, conducting share repurchases,
committing to conduct periodic self-tender offers,
merging with other funds, converting to an open-end
format and liquidating. Past actions taken by the Board
have included a special in-kind dividend of portfolio
securities, a share buy-back program, purchases of fund
shares pursuant to the fund's Dividend Reinvestment Plan
and increased publicity about the fund. After extensive
review, the Board felt the in-kind tender offer was the best
measure to address the discount at this time.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund initiated the tender offer supported by certain
large shareholders to provide an alternative source of
liquidity for their investment in shares and as part of the
fund's continuous efforts to provide additional value to
shareholders. The offer provides a means for shareholders
who want to sell a portion of their shares to do so at close
to NAV per share. The Board realized that the structure of
the tender offer might make it impractical for smaller
shareholders to participate and explored alternatives that
might have facilitated participation by small shareholders,
but regulatory and other considerations limited the fund's
flexibility in this regard. However, that does not mean that
smaller shareholders are at a disadvantage. Since the
announcement of the Board's plan to conduct the tender
offer, the discount to NAV has narrowed to as little as
- -2.94% on March 9, 2005. Thus, all shareholders have
had an opportunity to sell their shares on the open market
at a much reduced discount, should they have chosen to
do so. </FONT>
</P>
<P ALIGN="LEFT">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_44">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne2c0.gif" ALT="kor_NEW_SECTION2C0"></TD>
<TD ID="ID_1542" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="letter" ID="letter"></A>Portfolio Management Review</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1503" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><FONT SIZE="-1" COLOR="#000000">In the following interview, Lead Portfolio Manager Terrence Gray discusses the market
environment, fund performance and the strategy for managing The Korea Fund, Inc.
during the 12-month period ended June 30, 2005. Mr. Gray became lead manager of
the fund in June 2005. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;How did South Korea's stock market perform during
the annual period?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">Korea's stock market performed exceptionally well
during the past year, delivering total returns of 43.31% in
US dollar terms as measured by the KOSPI Index. This
return is all the more impressive in light of the sharp rise
in oil prices and the rhetoric emanating from North
Korea, issues that in the past have often led to market
weakness. US dollar investors also benefited from a rise in
South Korea's currency, the won. At the beginning of the
period, it took 1149.43 won to purchase one US dollar;
by the end of the period, this number had fallen to
1030.92.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Korean market has benefited as foreigners and local
investors alike have been attracted by valuations that, a
year ago, were near all-time lows. The return of individual
investors, many of whom have been wary of stocks since
the financial crisis of the mid-1990s, is a notable
development. Koreans have been encouraged by the
declining power of the old <I>chaebol</I> (Korea's industrial
conglomerates), the decrease in the number of bankrupt
companies trading on the stock market, and corporations'
growing focus on shareholder rights. In addition,
expectations for earnings growth &#151; which were
pessimistic a year ago &#151; have improved significantly
despite the tepid global economy. Growth in Korea,
meanwhile, has remained resilient as the problem of high
levels of consumer debt is being worked out of the system,
bringing an increase in confidence and a concurrent rise in
consumer spending. Finally, the stock market has
benefited as declining interest rates have driven money out
of the bond market and into equities. </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The result of these developments can be seen in local
mutual fund inflows, which netted approximately
$1&nbsp;billion a month throughout the first half of 2005,
versus net outflows for the whole of 2004. As compared to
the beginning of 2004, fund flows began to pick up at the
end of the year &#151; a meaningful development given that
the percentage of household assets that is invested in
equities is extremely low in Korea. This translates into an
extraordinary amount of potential demand for stocks. In
addition, next year will bring the introduction of defined
contribution retirement plans &#151; an event that will likely
lead to greater demand for stocks. Current equity holdings
by households in Korea are at all-time lows and extremely
low versus other countries.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">While the return of domestic institutions and individuals
to the stock market has been discussed for the last two
years, recent government initiatives are enabling this to
finally happen. The government is opening up the asset
management industry so that more global players can
enter the market and increase competition. Several global </FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_23">
<TR>
<TD ID="ID_615" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="4">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Household Asset Allocation Comparison as of June 30, 2005</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1362" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1355" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Deposit/Cash
Management</FONT></B>
</P>
</TD>
<TD ID="ID_1354" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Fixed Income</FONT></B>
</P>
</TD>
<TD ID="ID_1353" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Equities</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_857" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">North America</FONT>
</P>
</TD>
<TD ID="ID_654" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">35%</FONT>
</P>
</TD>
<TD ID="ID_653" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">24%</FONT>
</P>
</TD>
<TD ID="ID_652" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">41%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_856" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Europe</FONT>
</P>
</TD>
<TD ID="ID_651" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">35%</FONT>
</P>
</TD>
<TD ID="ID_650" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">31%</FONT>
</P>
</TD>
<TD ID="ID_649" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">33%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_855" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Asiapac &amp; Mideast</FONT>
</P>
</TD>
<TD ID="ID_648" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">55%</FONT>
</P>
</TD>
<TD ID="ID_647" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">19%</FONT>
</P>
</TD>
<TD ID="ID_646" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">26%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_854" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Latin America</FONT>
</P>
</TD>
<TD ID="ID_645" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">59%</FONT>
</P>
</TD>
<TD ID="ID_644" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">28%</FONT>
</P>
</TD>
<TD ID="ID_643" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">12%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_853" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">South Korea</FONT>
</P>
</TD>
<TD ID="ID_642" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">83%</FONT>
</P>
</TD>
<TD ID="ID_641" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">11%</FONT>
</P>
</TD>
<TD ID="ID_640" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">  6%</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Source:  Bank of Korea</FONT></I>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">asset management firms have been issued licenses to
operate in Korea and the government has been speeding
up this process over the past year. Beginning in January, all
foreign and domestic asset managers will be able to market
mutual funds directly to individuals (previously all
distribution had to be done through the banks and
securities firms). The government is working on legislation
to allow for the creation of 401(k)-type plans. The
National Pension Corporation (Korea's leading pension
manager, controlling nearly 90% of public pension fund
assets) is looking to increase its equity allocation to 10%
versus the current 6% (still well below average equity
allocations of over 20% at public pension funds in the
United States and Europe). Finally, the introduction of
equity savings plans now allows individuals to add to stock
portfolios on a monthly basis. The long-term result of
these changes is the creation of an &quot;investor class&quot; in
Korea. This process has just begun &#151; albeit at a slow pace
&#151; and we expect this to pick up meaningfully over the
next few years.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;How did the fund perform?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">For the year ended June 30, 2005, the net asset value
(NAV) total return of The Korea Fund, Inc. was 38.66%.
On a market-value basis, the total return, i.e., percentage
gain in the share price plus dividend yield, was 49.06%,
with the share price on the New York Stock Exchange
(NYSE) closing at $27.35 per share. This represented a
discount of -6.01% to NAV on June 30, 2005. The
KOSPI, against which the fund is measured, produced a
total return of 43.31% over the same period. (Please see
page <A HREF="#invsum">27</A> for more complete performance information. Past
performance is not indicative of future results.)</FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;What factors helped and hurt performance?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">The fund performed well on an absolute basis, but the
NAV underperformed the KOSPI Index. The primary
reason for underperformance was that the market's strong
total return, as represented by the KOSPI Index, was
largely driven by cash flows into large caps, some of which
we did not own. The inclusion of those large-cap stocks in
the index boosted its performance. For example, the fund
did not hold a position in Korea Electric Power, but the
index did. We believe this utility has poor fundamentals
but which performed well due to a short-term factor: the
strength of the won. Given the company's large exposure
to US-denominated debt, the company benefits from a
stronger local currency as the cost of debt is reduced. In
addition, Korean Electric Power is aided on the cost side,
as it purchases fuel such as oil in US dollars. Longer term,
however, the company has not delivered strong returns on
investment and we see better opportunities elsewhere in
the market. Over time, we believe the fund's overweight in
small- and mid-cap securities (those with market
capitalizations below $5 billion) and corresponding
underweight in large caps (those with market
capitalizations above $5 billion) will add value, and we
intend to maintain this positioning. Over the past few
years small-cap stocks have outperformed their large-cap
peers by about 500 basis points. Below is an attribution
analysis by market capitalization to demonstrate the fund's
positioning in these various segments and how they have
contributed to performance:</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_22">
<TR>
<TD ID="ID_614" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="8">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Performance Attribution</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Korea Fund vs. Korea: KOSPI Composite Index </FONT></B><FONT SIZE="-2" COLOR="#ffffff">(6/30/2004 to 6/30/2005) (US Dollar)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1361" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1352" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Korea Fund</FONT></B>
</P>
</TD>
<TD ID="ID_1351" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1350" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">KOSPI Composite Index</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1360" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_639" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Average
Weight</FONT>
</P>
</TD>
<TD ID="ID_638" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Total
Return</FONT>
</P>
</TD>
<TD ID="ID_637" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Contribution
To Return</FONT>
</P>
</TD>
<TD ID="ID_636" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_635" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Average
Weight</FONT>
</P>
</TD>
<TD ID="ID_634" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Total
Return</FONT>
</P>
</TD>
<TD ID="ID_633" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Contribution
To Return</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_852" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Greater than 25b</FONT>
</P>
</TD>
<TD ID="ID_1218" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">13.57</FONT>
</P>
</TD>
<TD ID="ID_1217" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">17.21</FONT>
</P>
</TD>
<TD ID="ID_1216" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2.26</FONT>
</P>
</TD>
<TD ID="ID_1215" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1214" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">17.36</FONT>
</P>
</TD>
<TD ID="ID_1213" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">17.21</FONT>
</P>
</TD>
<TD ID="ID_1212" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2.69</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_851" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">10b to 25b</FONT>
</P>
</TD>
<TD ID="ID_1211" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.35</FONT>
</P>
</TD>
<TD ID="ID_1210" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">45.25</FONT>
</P>
</TD>
<TD ID="ID_1209" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.17</FONT>
</P>
</TD>
<TD ID="ID_1208" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1207" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1206" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1205" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_850" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">5b to 10b</FONT>
</P>
</TD>
<TD ID="ID_1204" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">20.28</FONT>
</P>
</TD>
<TD ID="ID_1203" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">32.03</FONT>
</P>
</TD>
<TD ID="ID_1202" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7.35</FONT>
</P>
</TD>
<TD ID="ID_1201" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1200" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">16.85</FONT>
</P>
</TD>
<TD ID="ID_1199" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">28.95</FONT>
</P>
</TD>
<TD ID="ID_1198" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6.38</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_849" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">1b to 5b</FONT>
</P>
</TD>
<TD ID="ID_1197" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">25.89</FONT>
</P>
</TD>
<TD ID="ID_1196" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">41.78</FONT>
</P>
</TD>
<TD ID="ID_1195" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">10.99</FONT>
</P>
</TD>
<TD ID="ID_1194" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1193" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">31.75</FONT>
</P>
</TD>
<TD ID="ID_1192" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">51.33</FONT>
</P>
</TD>
<TD ID="ID_1191" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">15.91</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_848" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">500m to 1b</FONT>
</P>
</TD>
<TD ID="ID_1190" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">11.36</FONT>
</P>
</TD>
<TD ID="ID_1189" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">33.83</FONT>
</P>
</TD>
<TD ID="ID_1188" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3.96</FONT>
</P>
</TD>
<TD ID="ID_1187" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1186" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">11.43</FONT>
</P>
</TD>
<TD ID="ID_1185" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">64.06</FONT>
</P>
</TD>
<TD ID="ID_1184" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6.86</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_847" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">250m to 500m</FONT>
</P>
</TD>
<TD ID="ID_1183" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">9.04</FONT>
</P>
</TD>
<TD ID="ID_1182" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">65.75</FONT>
</P>
</TD>
<TD ID="ID_1181" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">5.66</FONT>
</P>
</TD>
<TD ID="ID_1180" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1179" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7.72</FONT>
</P>
</TD>
<TD ID="ID_1178" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">77.76</FONT>
</P>
</TD>
<TD ID="ID_1177" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">5.36</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_846" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Less than 250m</FONT>
</P>
</TD>
<TD ID="ID_1176" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">19.49</FONT>
</P>
</TD>
<TD ID="ID_1175" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">85.39</FONT>
</P>
</TD>
<TD ID="ID_1174" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">12.21</FONT>
</P>
</TD>
<TD ID="ID_1173" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1172" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">14.89</FONT>
</P>
</TD>
<TD ID="ID_1171" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">133.84</FONT>
</P>
</TD>
<TD ID="ID_1170" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">10.76</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1386" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Total</FONT></B>
</P>
</TD>
<TD ID="ID_596" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">100.00</FONT></B>
</P>
</TD>
<TD ID="ID_595" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">42.60</FONT></B>
</P>
</TD>
<TD ID="ID_594" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">42.60</FONT></B>
</P>
</TD>
<TD ID="ID_593" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_592" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">100.00</FONT></B>
</P>
</TD>
<TD ID="ID_591" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">47.96</FONT></B>
</P>
</TD>
<TD ID="ID_590" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">47.96</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1359" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1349" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Variation</FONT></B>
</P>
</TD>
<TD ID="ID_1348" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1347" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Attribution Analysis</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1358" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_632" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Average
Weight</FONT>
</P>
</TD>
<TD ID="ID_631" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Total
Return</FONT>
</P>
</TD>
<TD ID="ID_630" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Contribution
To Return</FONT>
</P>
</TD>
<TD ID="ID_629" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_628" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Allocation
Effect
(Local)</FONT>
</P>
</TD>
<TD ID="ID_627" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Selection
Effect
(Local)</FONT>
</P>
</TD>
<TD ID="ID_626" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Total Effect</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_845" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Greater than 25b</FONT>
</P>
</TD>
<TD ID="ID_1169" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-3.78</FONT>
</P>
</TD>
<TD ID="ID_1168" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1167" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.43</FONT>
</P>
</TD>
<TD ID="ID_1166" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1165" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1.32</FONT>
</P>
</TD>
<TD ID="ID_1164" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1163" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1.29</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_844" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">10b to 25b</FONT>
</P>
</TD>
<TD ID="ID_1162" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.35</FONT>
</P>
</TD>
<TD ID="ID_1161" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">45.25</FONT>
</P>
</TD>
<TD ID="ID_1160" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.17</FONT>
</P>
</TD>
<TD ID="ID_1159" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1158" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.08</FONT>
</P>
</TD>
<TD ID="ID_1157" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1156" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.00</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_843" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">5b to 10b</FONT>
</P>
</TD>
<TD ID="ID_1155" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3.43</FONT>
</P>
</TD>
<TD ID="ID_1154" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3.08</FONT>
</P>
</TD>
<TD ID="ID_1153" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.96</FONT>
</P>
</TD>
<TD ID="ID_1152" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1151" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.28</FONT>
</P>
</TD>
<TD ID="ID_1150" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.01</FONT>
</P>
</TD>
<TD ID="ID_1149" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.46</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_842" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">1b to 5b</FONT>
</P>
</TD>
<TD ID="ID_1148" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-5.85</FONT>
</P>
</TD>
<TD ID="ID_1147" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-9.55</FONT>
</P>
</TD>
<TD ID="ID_1146" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-4.91</FONT>
</P>
</TD>
<TD ID="ID_1145" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1144" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.17</FONT>
</P>
</TD>
<TD ID="ID_1143" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-2.46</FONT>
</P>
</TD>
<TD ID="ID_1142" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-2.60</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_841" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">500m to 1b</FONT>
</P>
</TD>
<TD ID="ID_1141" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.07</FONT>
</P>
</TD>
<TD ID="ID_1140" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-30.24</FONT>
</P>
</TD>
<TD ID="ID_1139" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-2.90</FONT>
</P>
</TD>
<TD ID="ID_1138" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1137" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.12</FONT>
</P>
</TD>
<TD ID="ID_1136" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-2.75</FONT>
</P>
</TD>
<TD ID="ID_1135" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-2.99</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_840" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">250m to 500m</FONT>
</P>
</TD>
<TD ID="ID_1134" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1.32</FONT>
</P>
</TD>
<TD ID="ID_1133" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-12.01</FONT>
</P>
</TD>
<TD ID="ID_1132" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.30</FONT>
</P>
</TD>
<TD ID="ID_1131" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1130" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">0.35</FONT>
</P>
</TD>
<TD ID="ID_1129" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.04</FONT>
</P>
</TD>
<TD ID="ID_1128" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.48</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_839" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Less than 250m</FONT>
</P>
</TD>
<TD ID="ID_1127" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4.60</FONT>
</P>
</TD>
<TD ID="ID_1126" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-48.44</FONT>
</P>
</TD>
<TD ID="ID_1125" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1.45</FONT>
</P>
</TD>
<TD ID="ID_1124" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1123" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2.90</FONT>
</P>
</TD>
<TD ID="ID_1122" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-3.24</FONT>
</P>
</TD>
<TD ID="ID_1121" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-0.13</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1385" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Total</FONT></B>
</P>
</TD>
<TD ID="ID_589" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">&#151;</FONT></B>
</P>
</TD>
<TD ID="ID_588" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">-5.36</FONT></B>
</P>
</TD>
<TD ID="ID_587" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">-5.36</FONT></B>
</P>
</TD>
<TD ID="ID_586" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_585" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">4.33</FONT></B>
</P>
</TD>
<TD ID="ID_584" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">-8.49</FONT></B>
</P>
</TD>
<TD ID="ID_583" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">-5.36</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">The variation in the above returns and the fund's actual returns are due to the exclusion of cash, the
exclusion of transaction costs and the use of market close prices instead of actual transaction prices.
The top half of the market cap attribution shows the returns of the fund's stocks in each market
capitalization segment vs. returns of stocks in same segment in the KOSPI Index. The bottom-left
portion of the chart shows the variation between the fund's average weight in each market
capitalization vs. the KOSPI Index. The bottom-right portion of the attribution analysis shows the fund's
allocation impact, as in how the decision to be in that segment helped performance and how
management's stock selection contributed to the performance in each segment.</FONT></I>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">About 66% of the fund is in stocks under $5 billion in
market cap. As the table above demonstrates, these stocks
have had much higher returns than the large-cap stocks in
the fund's portfolio. We take a more conservative value
approach in all of our stock picking; therefore, the fund </FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_24">
<TR>
<TD ID="ID_612" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Sector Distribution as a % of Total Assets (as of June 30, 2005)</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1384" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#3300d9">[]</FONT><B><FONT SIZE="-2" COLOR="#3300d9">    Korea Fund</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">[]</FONT><B><FONT SIZE="-2" COLOR="#000000">    KOSPI</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ALIGN="RIGHT" VALIGN="BOTTOM"><IMG SRC="korg1180.gif" ALT="kor_g10k180"></TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Sector distribution is subject to change.</FONT></I>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">was not invested in some of the more volatile technology
and construction company stocks where the portfolio
management team could not get comfortable with
valuations. As a result of this, the fund's performance in
this segment lagged the broader group of small- and
mid-cap stocks in the index. As always, however, we take a
long-term approach to stock selection.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Fund returns were helped by the performance of its
holdings in three areas: information technology, consumer
discretionary and energy. We will discuss each in turn.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Information Technology:</FONT></B><FONT COLOR="#000000"> We benefited from the gain in
Samsung Electronics Co., Ltd., the fund's top holding.
Although the company's sales have been slowing, we
believe operating profits and earnings bottomed in the
first half of the year. We expect earnings to increase as
product prices such as DRAM (Dynamic Random Access
Memory chips, which are used to store data temporarily
on personal computers and notebooks), NAND flash (a
compact memory device used for multimedia data storage
in products such as digital cameras and cellular phones)
and LCD (Laser Crystal Display panels used in flat screen
televisions)<B> </B>are forecast to rise in the second half of 2005.
Performance was also boosted by our positions in two
mid-cap tech stocks, SFA Engineering Corp. and Seoul
Semiconductor Co. Ltd., both of which we identified as
companies with quality niche products, rising market
share and, at the time of the fund's initial purchase,
single-digit price-to-earnings ratios. Both companies have
been successful in growing market share with leading
technology customers in each of their given areas of
expertise. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Consumer Discretionary:</FONT></B><FONT COLOR="#000000"> Within the consumer
discretionary area our overweight position in autos and
auto parts significantly contributed to performance. The
fund has a weighting of 10% in autos and auto parts
versus a weighting of 5% in the KOSPI. The environment
for global auto stocks has been challenging due to intense
competition and strong currencies in Asia. In the face of
this we added to fund performance via a position in
Hyundai Motor Co., which continued to gain market
share in the US, Europe and Asia. Hyundai's focus on
cutting costs and developing economies of scale has
allowed it to boost its profit margin despite strong moves
in Korea's currency, the won. In addition, Hyundai has
established a strong presence in the fast-growing markets
of India and China. Another position which helped
performance was Hankook Tire Co Inc., a manufacturer
of radial tires for passenger cars, light trucks and other
vehicles. Despite a late entrance into the Chinese market,
Hankook has become the largest seller of tires in the
country with a market share of 26%. The company
recently signed a deal with Michelin to have its tires
distributed in the United States, which we believe will
further enhance its market share and global brand image.
We believe Hankook is an excellent example of a Korean
company that has expanded its footprint to the global
level.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Energy:</FONT></B><FONT COLOR="#000000"> The fund's overweight position in the energy
sector is dominated by its large position in S-Oil, Korea's
leading oil refining company. Refining companies have
been in a &quot;sweet spot&quot; during the past year, as higher oil
prices have boosted refiners' profit margins. S-Oil
consistently demonstrates the ability to achieve refining
margins in excess of the benchmark Singapore margin and
will continue to benefit from the extremely tight market
for refined product, due to the dearth of refining capacity
in the region. S-Oil continues to employ a disciplined
approach to capital management and provides
shareholders with a 7.1% yield.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;What are some individual stocks that
underperformed?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">The fund's position in Samsung Fire &amp; Marine
Insurance Co Ltd., which has been held in the fund since
1984, was hurt by a combination of broad sector weakness
and rising competition. The fund's position in Daum
Communications Co., an Internet stock, also detracted.
Daum relies on Internet advertising, and has been losing
ground to Yahoo in this area. We sold this position during
the period, based on our belief that management has not
been executing their stated strategy well. The company's
acquisition of Lycos Korea had proven more costly than
expected and their strategy for it is unclear. A third
notable detractor was the fund's position in Samsung SDI
Co. Ltd, a manufacturer of displays for cell phones,
televisions and computer monitors that has been hurt as
rising industry competition has led to pricing pressures.
We maintain our position in this stock based on our belief
that profits are bottoming out and its efforts at business
rationalization will produce a stronger product portfolio. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;Do you plan to make any changes to the way the fund
has been managed?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">While we intend to continue the fund's focus on
long-term investment in value</FONT><FONT COLOR="#ff0000">-</FONT><FONT COLOR="#000000">creating companies, we will
increasingly also focus on assessing the prospects of
Korean equities versus their global peers. Our core
expertise lies in the systematic exploitation of inefficiencies
arising from excessive valuation and profitability gaps
between Korean companies and their global peers, and
the&nbsp;early detection of cash flow drivers. Our investment
process is built upon fundamental bottom-up analysis.
The Korean equity market has been driven by the
development of global industry leaders competing
head-to-head with the United States, Japan and Europe.
We analyze companies in the context of how they stack up
against global peers in a variety of industries &#151; examples
being autos, semiconductor equipment, electronics and
shipbuilding. </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">In line with this philosophy, we have lightened the fund's
weighting in steel stocks over the last few months as our
trade indicators signaled an increasingly challenging global
pricing environment. While the fund is positioned in
several specialty steel companies, these companies are still
subject to product price gyrations of the business cycle.
The fund remains overweight information technology due
to compelling valuations and a recovering global demand
cycle. A recent addition to our technology weighting was
NHN Corp., Korea's leading search engine portal. NHN
provides search engine functionality and is a leading site
for on-line gaming. The company holds a dominant
position in the Internet search ad market, which is
growing over 35% annually. Search ad revenue is being
driven by key word listings (the ability for a company to
pay a fee to have its company and/or product appear first
or amongst the top listed search results). NHN is
expanding globally with the recent launch of its service in
Japan and China, both of which have seen good growth
in&nbsp;revenues. We see NHN as an example of a Korean
business model that can be successfully replicated in
other&nbsp;markets.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">We will continue to emphasize the portfolio's exposure to
small- and mid-cap stocks (stocks with market
capitalization under US$ 5 billion) which represent
approximately 66% of the fund. As seen above in the
market cap attribution analysis, we have more exposure to
this segment of the market than our benchmark.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Korea has one of the deepest capital markets in Asia with a
market cap of US$ 530 billion and over 1,600 listed
companies. The majority of these companies fall into the
small- to mid-cap sector and this portion of the fund's
portfolio will remain a key driver for performance as these
companies&nbsp;offer:</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  Entrepreneurial managements</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  Globally competitive products</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  Simple ownership structure</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  Strong corporate governance</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Given that these companies are underowned and
underresearched, we have the unique opportunity to enter
these stocks before the broader market discovers them.
Our presence on the ground allows us to focus a great deal
of our time on the research of small- to mid-cap stocks.
The fund has been successful here with holdings such as
Korea Express Co. Ltd., a package delivery company that
emerged from the financial crisis of the late 1990s in good
shape and has since improved its position by reducing
debt and increasing its market share. The stock has more
than doubled since it was initially purchased for the fund.
In May of this year we initiated a position in SODIFF
Advanced Materials Co. Ltd., the number three global
manufacturer of NF3, a cleaning gas used in the LCD
and&nbsp;semiconductor manufacturing process. SODIFF is&nbsp;an
example of a small company that is dominating the&nbsp;global
industry and is benefiting from the rising production of
LCD panels for computer monitors and&nbsp;televisions.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">Q:&nbsp;&nbsp;What is your broad view on the Korean stock market?</FONT></B>
</P>
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#3300d9">A:</FONT></B><FONT COLOR="#000000">&nbsp;&nbsp;</FONT><FONT COLOR="#000000">Korean stocks have enjoyed a strong rally during the
past year, but in our view the market continues to
represent an attractive value versus other Asian markets,
its own history and the global markets as a whole. The
Korean market trades at P/E multiple of 8.2x 2005
expected earnings, which is well below multiples in the
Asian region. For example, the MSCI Asia ex-Japan Index
trades at 12.8x P/E, Taiwan trades at 11.7x, Hong Kong
at 16.6x and Malaysia at 16x. This valuation discrepancy
is unwarranted and we expect this gap to close over
time.&nbsp;Corporations continue to reduce debt, raise
dividends, improve free cash flow and focus on corporate
governance. In addition, foreigners, local institutions and
local retail investors are all showing an increased interest
in the market, which could lay the groundwork for
further contraction of Korea's &quot;valuation gap.&quot; We are
further encouraged by the growing number of emerging
companies with high-potential niche products, which we
believe is a reflection of Korea's entrepreneurial spirit.
Overall, we believe we are witnessing the continued
development of Korea as a deep market with a wealth of
attractive individual companies from which to choose.
We believe the foundation is in place for Korea to
continue to provide strong long-term performance
relative to both the broader world markets and its
Asian&nbsp;peers. </FONT>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">The views expressed in this report reflect those of the portfolio managers only through the
end of the period of the report as stated on the cover. The managers' views are subject to
change at any time based on market and other conditions and should not be construed as
a recommendation.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_43">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne2b0.gif" ALT="kor_NEW_SECTION2B0"></TD>
<TD ID="ID_1541" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="other" ID="other"></A>Other Information</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1502" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1501" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Investment Manager</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">Deutsche Investment Management Americas Inc. (&quot;DeIM&quot;), with
headquarters at 345 Park Avenue, New York, NY, is the investment manager
for the fund. DeIM and its predecessors have more than 80 years of experience
managing mutual funds. DeIM provides a full range of investment advisory
services to institutional and retail clients. DeIM is also responsible for selecting
brokers and dealers and for negotiating brokerage commissions and dealer
charges.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Deutsche Asset Management is the marketing name in the US for the asset
management activities of Deutsche Bank AG, Deutsche Bank Trust Company
Americas, Deutsche Asset Management, Inc., Deutsche Asset Management
Investment Services Ltd., Deutsche Investment Management Americas Inc.
and Scudder Trust Company.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Deutsche Asset Management is a global asset management organization that
offers a wide range of investing expertise and resources, including hundreds of
portfolio managers and analysts and an office network that reaches the world's
major investment centers. This well-resourced global investment platform
brings together a wide variety of experience and investment insight across
industries, regions, asset classes and investing styles.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">DeIM is an indirect, wholly owned subsidiary of Deutsche Bank AG.
Deutsche Bank AG is a major global banking institution that is engaged in a
wide range of financial services, including investment management, mutual
fund, retail, private and commercial banking, investment banking and
insurance.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Deutsche Asset Management also manages the assets of other closed-end
investment companies which invest primarily in foreign securities: Scudder
New Asia Fund, Inc., The Brazil Fund, Inc., Scudder Global High Income
Fund, Inc., Scudder Global Commodities Stock Fund, Inc., The Germany
Fund, Inc., The New Germany Fund, Inc. and The&nbsp;Central Europe and
Russia Fund, Inc. In addition, Deutsche Asset Management manages
open-end mutual funds which invest in domestic and international markets.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Korean Advisor</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">Deutsche Investment Trust Management Company Limited (&quot;DeITMC&quot;),
located at 19F, Youngpoong Building, 33, Seorin-Dong, Chongro-ku, Seoul,
Korea, serves as subadvisor to the fund. DeITMC renders investment advisory
and management services with regard to the fund's portfolio. From time to
time, DeITMC makes specific investment recommendations, which then are
evaluated by DeIM's portfolio managers in light of their own expertise and
information from other sources in making investment decisions for the fund.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Repurchase Offers and Fee Reductions</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">On December 15, 2004, the fund's Board of Directors approved a series of
measures designed to enhance shareholder value and to maintain the fund's
viability: </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  an offer to repurchase 50% of the fund's outstanding shares
in&nbsp;exchange&nbsp;for&nbsp;portfolio securities of the fund;</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  a program for future repurchase offers; and </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><FONT SIZE="-2"></FONT>  a reduction in the fee paid to the fund's manager,
Deutsche&nbsp;Investment&nbsp;Management Americas Inc.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">On July 8, 2005, the fund commenced the initial tender offer for up to
22,350,747 of its shares, representing approximately 50% of its issued and
outstanding shares of common stock, in exchange for portfolio securities of
the fund at a price per share equal to 98% of the net asset value per share as
of&nbsp;the day after the day the offer expires. The tender offer will remain open
through August 19, 2005, unless extended. The tender offer is being
conducted in order to provide shareholders with an alternative source of
liquidity for their investment in fund shares and as part of the fund's
continuous efforts to provide additional value to shareholders.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The program for future repurchase offers consists of semiannual offers, each to
repurchase 10% of the fund's shares then outstanding, at a price of 98% of net
asset value on the day after expiration of the offer, in the three calendar years
following completion of the initial offer. As with the initial offer, participating
holders would be paid in kind, by receiving a pro rata share of the fund's
portfolio. Each of these subsequent offers would be made, subject to
regulatory approvals, fiduciary and other applicable requirements, if the fund's
shares traded on the New York Stock Exchange at an average weekly discount
from net asset value greater than 5% during a 13-week measuring period
ending the last day of the preceding half-year.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">In light of the size of the initial offer and the program for subsequent offers,
the board announced that the fund would not proceed with its previously
announced program of a contingent 10% repurchase offer in the first quarter
of 2005 and in the first quarter of 2006.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Board also announced a reduction, effective December 1, 2004, in the
fees payable to the fund's manager. Previously, the annual management fee had
ranged from 1.15% on the first $50 million of net assets to 0.85% of net
assets over $1.050 billion. Under the amended advisory agreement, the
management fee ranges from 0.60% on the first $250 million of net assets to
0.50% of net assets in excess of $1 billion. On the fund's current assets as of
June 30, 2005, this represents an overall reduction of approximately 42% in
the management fee.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">There can be no assurance that the approvals needed for the semiannual
repurchase offers will be obtained, or that any action proposed or adopted by
the board will reduce or eliminate the discount from net asset value at which
the fund's shares trade. The fund's announcement is not an offer to purchase
or the solicitation of an offer to sell shares of the fund. The repurchase offers
referred to in the fund's announcement will be made only by the offer to
purchase and related letter of transmittal. Stockholders should review these
documents carefully when they are available, because they will contain
important information. These documents will be available to investors for free
at the Web site of the Securities and Exchange Commission (www.sec.gov), as
well as on the fund's Web site at www.CEF.scudder.com. An offer to purchase
will not be made to, nor will tenders pursuant to the offer to purchase be
accepted from or on behalf of, holders of shares in any jurisdiction in which
making or accepting the offer to purchase would violate the jurisdiction's laws.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="subevent" ID="subevent"></A>Annual Meeting of Stockholders</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">On July 26, 2005, the Board of Directors of the fund announced that the
annual meeting of shareholders of the Fund, normally held in October, will be
held on Wednesday, December 14, 2005. The later meeting date reflects a
decision by the board to defer action on the board's nominees for election at
the meeting until the results of the pending tender offer, with the attendant
possible changes in the fund's ownership, are known.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Changes in Officers</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">On July 6, 2005, the Board of Directors elected Paul Schubert as Treasurer,
replacing Charles A. Rizzo. Mr. Schubert also serves as the fund's Chief
Financial Officer. The Board also elected Carole Coleman as Vice President
and Secretary, replacing Bruce A. Rosenblum, and Scott McHugh as Assistant
Treasurer, replacing Kevin Gay.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Changes in Directors' Retirement Dates</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund expects that William H. Luers would continue as a Director until
his term expires at the fund's 2005 annual meeting, and that Robert J.
Callander, because of his responsibilities as Chairman of the Board, would
continue as a Director until his term expires at the fund's 2006 annual
meeting. The fund had indicated previously that both Directors were
expected&nbsp;to retire in April 2005.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Dividend Reinvestment and Cash Purchase Plan</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund's Dividend Reinvestment and Cash Purchase Plan offers you a
convenient way to have your dividends and capital gain distributions
reinvested in shares of the fund. We believe this Plan is attractive for
stockholders. Its features are more fully described on page <A HREF="#drip">51</A>. You may obtain
more detailed information by requesting a copy of the Plan from the Transfer
Agent. All correspondence (including notifications) should be directed to:
The&nbsp;Korea Fund Dividend Reinvestment and Cash Purchase Plan,
c/o&nbsp;Scudder Investments Service Company, P.O. Box 219066, Kansas City,
MO 4121-9066, 1-800-294-4366.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Proxy Voting </FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">A description of the fund's policies and procedures for voting proxies for
portfolio securities and information about how the fund voted proxies related
to its portfolio securities during the 12-month period ended June 30 is
available on our Web site &#151; scudder.com (type &quot;proxy voting&quot; in the search
field)&nbsp;&#151;&nbsp;or on the SEC's Web site &#151; www.sec.gov. To obtain a written&nbsp;copy
of the fund's policies and procedures without charge, upon request, call us toll
free at (800) 621-1048.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Share Repurchases</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Board of Directors of The Korea Fund, Inc. has authorized the fund to
effect periodic repurchases of its shares in the open market from time to time
when the fund's shares trade at a discount to their NAV. Subject to periodic
review by the Board, repurchases may be made at such time and in such
amounts as the fund's Manager believes will further the achievement of the
fund's objectives. Depending on market conditions, available funds, regulatory
requirements and alternative investment opportunities, such repurchases are
limited to (1) 5% of the shares outstanding at the beginning of the calendar
year, plus (2) an estimate of shares to be issued in connection with the current
calendar year's dividends, plus (3) the number of shares authorized for
purchase in the previous calendar year that have not been purchased. In
measuring the number of shares authorized for repurchase, the shares relating
to the current calendar year's dividends are estimated at 50% of&nbsp;the number of
shares issued in connection with the prior calendar year's dividends or until
such time during the calendar year that the fund's Manager has a more
accurate projection of the calendar year's dividends. Repurchases made based
on this estimate shall continue to have been authorized, even if the actual
dividend or related share issuance is lower. During the twelve months ended
June 30, 2005, the fund repurchased no shares pursuant to this&nbsp;share
repurchase plan as described above.</FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Net Asset Value</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund's NAV is available daily on our Web site at
<B><FONT SIZE="-1">www.TheKoreaFund.com</FONT></B> or visit our Direct Link <B><FONT SIZE="-1">www.CEF.Scudder.com</FONT></B>.
The fund's NAV is published weekly on Monday and the fund's Market Value
is published every weekday in <I>The Wall Street Journal</I> under the heading
&quot;Closed End Funds.&quot; The fund's market value is also published daily in <I>The
New York Times</I> and weekly in <I>Barron's.</I> The fund's NAV is also published
weekly in <I>Barron's.</I> </FONT>
</P>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">Certifications</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund's chief executive officer has certified to the New York Stock
Exchange that, as of November 4, 2004, he was not aware of any violation by
the fund of applicable NYSE corporate governance listing standards. The
fund's reports to the Securities and Exchange Commission on Forms N-CSR,
N-CSRS and N-Q contain certifications by the fund's chief executive officer
and chief financial officer that relate to the fund's disclosure in such reports
and that are required by rule 30a-2(a) under the Investment Company Act.</FONT>
</P>
<P ALIGN="LEFT">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_42">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne2a0.gif" ALT="kor_NEW_SECTION2A0"></TD>
<TD ID="ID_1540" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="invsum" ID="invsum"></A>Investment Summary      </FONT><FONT COLOR="#000000">as of June 30, 2005</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1500" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1499" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">All performance shown is historical, assumes reinvestment of all dividend and
capital gain distributions, and does not guarantee future results. Investment
return and principal value fluctuate with changing market conditions so that,
when sold, shares may be worth more or less than their original cost. Current
performance may be lower or&nbsp;higher than the performance data quoted. Please
visit www.CEF.Scudder.com for the Fund's most recent performance.</FONT></B>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_8">
<TR>
<TD ID="ID_611" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="12">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Historical Information </FONT></B><FONT SIZE="-2" COLOR="#ffffff">as of 6/30/05</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_838" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1346" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="11">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Total Return (%)<SUP>d</SUP></FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_837" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1345" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Market Value<SUP>a</SUP></FONT></B>
</P>
</TD>
<TD ID="ID_1344" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1343" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Net Asset
Value<SUP>a</SUP></FONT></B>
</P>
</TD>
<TD ID="ID_1342" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1341" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Index<SUP>b</SUP></FONT></B>
</P>
</TD>
<TD ID="ID_1340" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1339" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Index<SUP>c</SUP></FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_836" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1338" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Cumulative</FONT></B>
</P>
</TD>
<TD ID="ID_1337" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Average
Annual</FONT></B>
</P>
</TD>
<TD ID="ID_1336" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1335" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Cumulative</FONT></B>
</P>
</TD>
<TD ID="ID_1334" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Average
Annual</FONT></B>
</P>
</TD>
<TD ID="ID_1333" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1332" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Cumulative</FONT></B>
</P>
</TD>
<TD ID="ID_1331" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Average
Annual</FONT></B>
</P>
</TD>
<TD ID="ID_1330" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1329" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Cumulative</FONT></B>
</P>
</TD>
<TD ID="ID_1328" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Average
Annual</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_835" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Current
Quarter</FONT>
</P>
</TD>
<TD ID="ID_1120" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3.80</FONT>
</P>
</TD>
<TD ID="ID_1119" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1118" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1117" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2.50</FONT>
</P>
</TD>
<TD ID="ID_1116" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1115" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1114" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2.48</FONT>
</P>
</TD>
<TD ID="ID_1113" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1112" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1111" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4.40</FONT>
</P>
</TD>
<TD ID="ID_1110" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_834" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">One Year</FONT>
</P>
</TD>
<TD ID="ID_1109" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">49.06</FONT>
</P>
</TD>
<TD ID="ID_1108" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">49.06</FONT>
</P>
</TD>
<TD ID="ID_1107" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1106" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">38.66</FONT>
</P>
</TD>
<TD ID="ID_1105" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">38.66</FONT>
</P>
</TD>
<TD ID="ID_1104" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1103" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">43.31</FONT>
</P>
</TD>
<TD ID="ID_1102" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">43.31</FONT>
</P>
</TD>
<TD ID="ID_1101" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1100" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">28.30</FONT>
</P>
</TD>
<TD ID="ID_1099" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">28.30</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_833" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Three Year</FONT>
</P>
</TD>
<TD ID="ID_1098" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">82.11</FONT>
</P>
</TD>
<TD ID="ID_1097" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">22.12</FONT>
</P>
</TD>
<TD ID="ID_1096" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1095" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">57.78</FONT>
</P>
</TD>
<TD ID="ID_1094" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">16.42</FONT>
</P>
</TD>
<TD ID="ID_1093" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1092" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">57.65</FONT>
</P>
</TD>
<TD ID="ID_1091" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">16.35</FONT>
</P>
</TD>
<TD ID="ID_1090" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1089" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">35.74</FONT>
</P>
</TD>
<TD ID="ID_1088" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">10.70</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_832" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Five Year</FONT>
</P>
</TD>
<TD ID="ID_1087" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">147.83</FONT>
</P>
</TD>
<TD ID="ID_1086" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">19.90</FONT>
</P>
</TD>
<TD ID="ID_1085" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1084" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">85.04</FONT>
</P>
</TD>
<TD ID="ID_1083" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">13.10</FONT>
</P>
</TD>
<TD ID="ID_1082" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1081" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">32.32</FONT>
</P>
</TD>
<TD ID="ID_1080" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">5.76</FONT>
</P>
</TD>
<TD ID="ID_1079" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1078" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">22.76</FONT>
</P>
</TD>
<TD ID="ID_1077" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4.18</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_831" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Ten Year</FONT>
</P>
</TD>
<TD ID="ID_1076" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">91.57</FONT>
</P>
</TD>
<TD ID="ID_1075" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6.72</FONT>
</P>
</TD>
<TD ID="ID_1074" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1073" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">101.11</FONT>
</P>
</TD>
<TD ID="ID_1072" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7.24</FONT>
</P>
</TD>
<TD ID="ID_1071" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1070" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-17.73</FONT>
</P>
</TD>
<TD ID="ID_1069" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-1.93</FONT>
</P>
</TD>
<TD ID="ID_1068" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1067" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">12.72</FONT>
</P>
</TD>
<TD ID="ID_1066" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1.20</FONT>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_19">
<TR>
<TD ID="ID_610" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="12">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Per Share Information and Returns<SUP>a</SUP></FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1327" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1275" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="10">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">Yearly periods ended June 30</FONT>
</P>
</TD>
<TD ID="ID_1274" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD COLSPAN="12" ALIGN="RIGHT" VALIGN="BOTTOM"><IMG SRC="korps130.gif" ALT="kor_psi130"></TD>
</TR>

<TR>
<TD ID="ID_830" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1326" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">1996</FONT></B>
</P>
</TD>
<TD ID="ID_1325" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">1997</FONT></B>
</P>
</TD>
<TD ID="ID_1324" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">1998</FONT></B>
</P>
</TD>
<TD ID="ID_1323" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">1999</FONT></B>
</P>
</TD>
<TD ID="ID_1322" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2000</FONT></B>
</P>
</TD>
<TD ID="ID_1321" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2001</FONT></B>
</P>
</TD>
<TD ID="ID_1320" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2002</FONT></B>
</P>
</TD>
<TD ID="ID_1319" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2003</FONT></B>
</P>
</TD>
<TD ID="ID_1318" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2004</FONT></B>
</P>
</TD>
<TD ID="ID_1317" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2005</FONT></B>
</P>
</TD>
<TD ID="ID_1316" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_829" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net Asset
Value&nbsp;($)</FONT>
</P>
</TD>
<TD ID="ID_1065" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">18.52</FONT>
</P>
</TD>
<TD ID="ID_1064" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">13.22</FONT>
</P>
</TD>
<TD ID="ID_1063" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">5.63</FONT>
</P>
</TD>
<TD ID="ID_1062" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">17.72</FONT>
</P>
</TD>
<TD ID="ID_1061" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">20.04</FONT>
</P>
</TD>
<TD ID="ID_1060" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">13.01</FONT>
</P>
</TD>
<TD ID="ID_1059" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">20.20</FONT>
</P>
</TD>
<TD ID="ID_1058" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">17.62</FONT>
</P>
</TD>
<TD ID="ID_1057" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">21.55</FONT>
</P>
</TD>
<TD ID="ID_1056" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">29.10</FONT>
</P>
</TD>
<TD ID="ID_1055" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_828" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Income
Dividends ($)</FONT>
</P>
</TD>
<TD ID="ID_1054" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.06</FONT>
</P>
</TD>
<TD ID="ID_1053" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1052" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1051" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1050" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1049" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.18</FONT>
</P>
</TD>
<TD ID="ID_1048" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1047" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.18</FONT>
</P>
</TD>
<TD ID="ID_1046" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.30</FONT>
</P>
</TD>
<TD ID="ID_1045" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.45</FONT>
</P>
</TD>
<TD ID="ID_1044" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_827" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Capital Gains
Distributions ($)</FONT>
</P>
</TD>
<TD ID="ID_1043" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.36</FONT>
</P>
</TD>
<TD ID="ID_1042" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.60</FONT>
</P>
</TD>
<TD ID="ID_1041" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1040" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1039" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1038" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1.41</FONT>
</P>
</TD>
<TD ID="ID_1037" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.12</FONT>
</P>
</TD>
<TD ID="ID_1036" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.67</FONT>
</P>
</TD>
<TD ID="ID_1035" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
<TD ID="ID_1034" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">.20</FONT>
</P>
</TD>
<TD ID="ID_1033" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_826" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total Return&nbsp;(%)</FONT>
</P>
</TD>
<TD ID="ID_1032" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-5.09</FONT>
</P>
</TD>
<TD ID="ID_1031" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-24.40</FONT>
</P>
</TD>
<TD ID="ID_1030" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-57.41</FONT>
</P>
</TD>
<TD ID="ID_1029" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">214.74</FONT>
</P>
</TD>
<TD ID="ID_1028" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">13.09</FONT>
</P>
</TD>
<TD ID="ID_1027" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-25.01</FONT>
</P>
</TD>
<TD ID="ID_1026" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">56.39</FONT>
</P>
</TD>
<TD ID="ID_1025" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">-8.34</FONT>
</P>
</TD>
<TD ID="ID_1024" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">24.15</FONT>
</P>
</TD>
<TD ID="ID_1023" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">38.66</FONT>
</P>
</TD>
<TD ID="ID_1022" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_9">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="kornee90.gif" ALT="kor_NEW_PAGE90"></TD>
<TD ID="ID_1549" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><I><FONT COLOR="#000000">&nbsp;</FONT></I></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1498" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1497" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>a</SUP> Total return based on net asset value reflects changes in the Fund's net asset value during each
period. Total return based on market value reflects changes in market value. Each figure assumes
that dividend and capital gains, if any, were reinvested. These figures will differ depending upon
the level of any discount from or premium to NAV at which the Fund's shares traded during the
period.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>b</SUP> Korea Stock Price Index (&quot;KOSPI&quot;) in US dollars.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>c</SUP> KOSPI in local terms.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>d</SUP> Returns less than one year are not annualized.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">KOSPI is an unmanaged capitalization-weighted index of all common shares on the Stock Market
Division of the Korea Exchange (formerly the &quot;Korea Stock Exchange&quot;). The index is calculated using
closing local market prices and converts to US dollars using the London close foreign exchange rates.
Index returns, unlike Fund returns, do not reflect any fees or expenses. It is not possible to invest
directly into an index.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_41">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne290.gif" ALT="kor_NEW_SECTION290"></TD>
<TD ID="ID_1538" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="portsum" ID="portsum"></A>Portfolio Summary     </FONT><FONT COLOR="#000000">as of June 30, 2005</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1496" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1495" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_17">
<TR>
<TD ID="ID_609" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Asset Allocation</FONT></B>
</P>
</TD>
<TD ID="ID_68" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">6/30/05</FONT></B>
</P>
</TD>
<TD ID="ID_67" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">6/30/04</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_224" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_223" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Common Stocks</FONT>
</P>
</TD>
<TD ID="ID_1021" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">84%</FONT>
</P>
</TD>
<TD ID="ID_1020" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">84%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_222" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Preferred Stocks</FONT>
</P>
</TD>
<TD ID="ID_1019" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">16%</FONT>
</P>
</TD>
<TD ID="ID_1018" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">16%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1017" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1016" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">100%</FONT>
</P>
</TD>
<TD ID="ID_1015" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">100%</FONT>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_16">
<TR>
<TD ID="ID_608" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Sector Diversification<BR>
</FONT></B><FONT SIZE="-2" COLOR="#ffffff">(Sector breakdown of the Fund's equity securities)</FONT>
</P>
</TD>
<TD ID="ID_66" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">6/30/05</FONT></B>
</P>
</TD>
<TD ID="ID_65" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">6/30/04</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_221" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_825" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Information Technology</FONT>
</P>
</TD>
<TD ID="ID_1014" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">28%</FONT>
</P>
</TD>
<TD ID="ID_1013" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">30%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_824" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Consumer Discretionary</FONT>
</P>
</TD>
<TD ID="ID_1012" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">19%</FONT>
</P>
</TD>
<TD ID="ID_1011" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">18%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_823" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Financials</FONT>
</P>
</TD>
<TD ID="ID_1010" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">17%</FONT>
</P>
</TD>
<TD ID="ID_1009" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">15%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_822" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Consumer Staples</FONT>
</P>
</TD>
<TD ID="ID_1008" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">11%</FONT>
</P>
</TD>
<TD ID="ID_1007" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_821" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Materials</FONT>
</P>
</TD>
<TD ID="ID_1006" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">9%</FONT>
</P>
</TD>
<TD ID="ID_1005" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">10%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_820" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Energy</FONT>
</P>
</TD>
<TD ID="ID_1004" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">8%</FONT>
</P>
</TD>
<TD ID="ID_1003" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">8%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_819" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Industrials</FONT>
</P>
</TD>
<TD ID="ID_1002" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4%</FONT>
</P>
</TD>
<TD ID="ID_1001" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_818" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Telecommunications Services</FONT>
</P>
</TD>
<TD ID="ID_1000" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3%</FONT>
</P>
</TD>
<TD ID="ID_999" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6%</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_220" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Health Care</FONT>
</P>
</TD>
<TD ID="ID_998" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1%</FONT>
</P>
</TD>
<TD ID="ID_997" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">&#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_996" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_995" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">100%</FONT>
</P>
</TD>
<TD ID="ID_994" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">100%</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Asset allocation and sector diversification are subject to change.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_18">
<TR>
<TD ID="ID_607" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Ten Largest Equity Holdings at June 30, 2005 </FONT></B><FONT SIZE="-2" COLOR="#ffffff">(58.7% of Net Assets)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_270" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     1.      Samsung Electronics Co., Ltd.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Manufacturer of electronic parts</FONT>
</P>
</TD>
<TD ID="ID_1422" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">17.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_269" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     2.      Samsung Fire &amp; Marine Insurance Co., Ltd.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Provider of insurance products</FONT>
</P>
</TD>
<TD ID="ID_1421" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">7.8%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_268" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     3.      Hyundai Motor Co.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Manufacturer of motor vehicles</FONT>
</P>
</TD>
<TD ID="ID_1420" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">5.9%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_267" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     4.      S-Oil Corp.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Refines crude oil and sells petroleum and related products</FONT>
</P>
</TD>
<TD ID="ID_1419" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">5.8%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_266" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     5.      POSCO</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Manufacturer of steel </FONT>
</P>
</TD>
<TD ID="ID_1418" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">5.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_265" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     6.      Hankook Tire Co., Ltd.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Manufacturer of tires, tire tubes and aluminum alloy wheels</FONT>
</P>
</TD>
<TD ID="ID_1417" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">4.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_264" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     7.      Kookmin Bank</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Provider of commercial banking services</FONT>
</P>
</TD>
<TD ID="ID_1416" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">3.5%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_263" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     8.      SK Telecom Co., Ltd.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Provider of mobile telecommunication services</FONT>
</P>
</TD>
<TD ID="ID_1415" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">3.5%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_262" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     9.      Shinsegae Co., Ltd.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Operator of discount stores</FONT>
</P>
</TD>
<TD ID="ID_1414" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">3.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_261" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     10.     KT&amp;G Corp.</FONT></B>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Producer of tobacco in Korea</FONT>
</P>
</TD>
<TD ID="ID_1413" ALIGN="RIGHT" VALIGN="TOP">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#3300d9">2.3%</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Portfolio holdings are subject to change.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">For more complete details about the Fund's investment portfolio, see page <A HREF="#portfolio">31</A>. A quarterly Fact Sheet
is&nbsp;available upon request. Please call 1-800-349-4281.</FONT></I>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Following the Fund's fiscal first and third quarter-end, a complete portfolio
holdings listing is filed with the SEC on Form N-Q. The form will be
available on the SEC's Web site at www.sec.gov, and it also may be reviewed
and copied at the SEC's Public Reference Room in Washington, D.C.
Information on the operation of the SEC's Public Reference Room may be
obtained by calling (800)&nbsp;SEC-0330.</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_40">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne280.gif" ALT="kor_NEW_SECTION280"></TD>
<TD ID="ID_1537" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="portfolio" ID="portfolio"></A>Investment Portfolio      </FONT><FONT COLOR="#000000">as of June 30, 2005</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1494" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1493" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_15">
<TR>
<TD ID="ID_219" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_59" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000"><BR>
Shares</FONT></B>
</P>
</TD>
<TD ID="ID_58" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">Value ($)</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_218" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_993" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_606" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Common Stocks 82.6%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1449" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Consumer Discretionary 12.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_109" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Auto Components 7.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_217" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Halla Climate Control Corp. </FONT>
</P>
</TD>
<TD ID="ID_992" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">315,520</FONT>
</P>
</TD>
<TD ID="ID_991" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2,728,755</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_216" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hankook Tire Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_990" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4,464,307</FONT>
</P>
</TD>
<TD ID="ID_989" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">53,547,410</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_215" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hyundai Mobis </FONT>
</P>
</TD>
<TD ID="ID_988" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">350,480</FONT>
</P>
</TD>
<TD ID="ID_987" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">23,452,968</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_214" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Nexen Tire Corp. </FONT>
</P>
</TD>
<TD ID="ID_986" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">400,000</FONT>
</P>
</TD>
<TD ID="ID_985" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">8,302,372</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_213" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Climate Control Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_984" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">827,630</FONT>
</P>
</TD>
<TD ID="ID_983" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4,467,343</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_212" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_582" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">92,498,848</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_108" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Hotels Restaurants &amp; Leisure 2.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_211" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hotel Shilla Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_982" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">858,391</FONT>
</P>
</TD>
<TD ID="ID_981" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6,166,194</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_210" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Kangwon Land, Inc. </FONT>
</P>
</TD>
<TD ID="ID_980" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,471,530</FONT>
</P>
</TD>
<TD ID="ID_979" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">20,975,897</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_209" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_581" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">27,142,091</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_107" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Internet &amp; Catalog Retail 0.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_208" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">GS Home Shopping, Inc. </FONT>
</P>
</TD>
<TD ID="ID_978" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">56,200</FONT>
</P>
</TD>
<TD ID="ID_580" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">4,038,104</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_106" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Media 1.8%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_207" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Cheil Communications, Inc. </FONT>
</P>
</TD>
<TD ID="ID_977" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">80,000</FONT>
</P>
</TD>
<TD ID="ID_976" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">15,023,124</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_206" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Yedang Entertainment Co., Ltd.* </FONT>
</P>
</TD>
<TD ID="ID_975" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">532,700</FONT>
</P>
</TD>
<TD ID="ID_974" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">8,400,448</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_205" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_579" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">23,423,572</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_105" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Multiline Retail 0.9%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_204" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Taegu Department Store Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_973" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,336,800</FONT>
</P>
</TD>
<TD ID="ID_578" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">12,345,615</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_104" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Textiles, Apparel &amp; Luxury Goods 0.2%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_203" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">BYC Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_972" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">39,530</FONT>
</P>
</TD>
<TD ID="ID_577" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">2,257,028</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1448" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Consumer Staples 9.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_103" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Beverages 0.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_202" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hite Brewery Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_971" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">50,000</FONT>
</P>
</TD>
<TD ID="ID_576" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">4,299,720</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_102" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Food &amp; Staples Retailing 3.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_201" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Shinsegae Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_970" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">135,787</FONT>
</P>
</TD>
<TD ID="ID_575" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">42,756,822</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_101" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Food Products 3.8%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_200" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">CJ Corp. </FONT>
</P>
</TD>
<TD ID="ID_969" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">99,606</FONT>
</P>
</TD>
<TD ID="ID_968" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7,380,024</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_199" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Crown Confectionary Co., Ltd. (c)</FONT>
</P>
</TD>
<TD ID="ID_967" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">95,600</FONT>
</P>
</TD>
<TD ID="ID_966" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">14,702,465</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_198" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Nam Yang Dairy Products Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_965" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">33,641</FONT>
</P>
</TD>
<TD ID="ID_964" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">15,489,286</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_197" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Nhong Shim Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_963" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">38,229</FONT>
</P>
</TD>
<TD ID="ID_962" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">11,050,616</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_196" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_574" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">48,622,391</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_100" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Tobacco 2.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_195" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">KT&amp;G Corp. 144A, (GDR) </FONT>
</P>
</TD>
<TD ID="ID_961" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">413,800</FONT>
</P>
</TD>
<TD ID="ID_960" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">8,184,964</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_194" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">KT&amp;G Corp. </FONT>
</P>
</TD>
<TD ID="ID_959" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">552,570</FONT>
</P>
</TD>
<TD ID="ID_958" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">21,615,535</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_193" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_573" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">29,800,499</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1447" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Energy 6.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_99" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Oil, Gas &amp; Consumable Fuels </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_192" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">S-Oil Corp. </FONT>
</P>
</TD>
<TD ID="ID_957" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">827,300</FONT>
</P>
</TD>
<TD ID="ID_956" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">65,844,123</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_191" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SK Corp. </FONT>
</P>
</TD>
<TD ID="ID_955" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">408,800</FONT>
</P>
</TD>
<TD ID="ID_954" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">21,625,817</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_190" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_572" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">87,469,940</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1446" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Financials 14.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_98" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Banks 4.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_189" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Jeonbuk Bank (c) </FONT>
</P>
</TD>
<TD ID="ID_953" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2,787,695</FONT>
</P>
</TD>
<TD ID="ID_952" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">15,311,560</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_188" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Kookmin Bank (ADR) </FONT>
</P>
</TD>
<TD ID="ID_951" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">100,917</FONT>
</P>
</TD>
<TD ID="ID_950" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4,599,797</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_187" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Kookmin Bank </FONT>
</P>
</TD>
<TD ID="ID_949" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">909,198</FONT>
</P>
</TD>
<TD ID="ID_948" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">41,381,296</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_186" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_571" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">61,292,653</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_97" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Capital Markets 0.9%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_185" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Korea Investment Holdings Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_947" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">436,900</FONT>
</P>
</TD>
<TD ID="ID_946" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7,803,368</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_184" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Securities Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_945" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">164,720</FONT>
</P>
</TD>
<TD ID="ID_944" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4,376,288</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_183" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_570" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">12,179,656</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_96" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Consumer Finance 0.8%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_182" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">LG Card Co., Ltd.* </FONT>
</P>
</TD>
<TD ID="ID_943" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">301,699</FONT>
</P>
</TD>
<TD ID="ID_569" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">9,951,349</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_95" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Insurance 7.9%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_181" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Korean Reinsurance Co. </FONT>
</P>
</TD>
<TD ID="ID_942" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,643,310</FONT>
</P>
</TD>
<TD ID="ID_941" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">10,281,090</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_180" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Oriental Fire &amp; Marine Insurance Co. (c) </FONT>
</P>
</TD>
<TD ID="ID_940" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">584,860</FONT>
</P>
</TD>
<TD ID="ID_939" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">12,983,002</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_179" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Fire &amp; Marine Insurance Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_938" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">979,625</FONT>
</P>
</TD>
<TD ID="ID_937" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">79,187,981</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_178" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_568" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">102,452,073</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1445" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Health Care 0.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_94" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Pharmaceuticals </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_177" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Choongwae Pharma Corp. </FONT>
</P>
</TD>
<TD ID="ID_936" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">88,600</FONT>
</P>
</TD>
<TD ID="ID_935" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3,727,809</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_176" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Yuhan Corp. </FONT>
</P>
</TD>
<TD ID="ID_934" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">48,798</FONT>
</P>
</TD>
<TD ID="ID_933" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">5,619,425</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_175" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_567" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">9,347,234</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1444" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Industrials 4.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_93" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Air Freight &amp; Logistics 1.2%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_174" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Korea Express Co., Ltd.* </FONT>
</P>
</TD>
<TD ID="ID_932" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">301,880</FONT>
</P>
</TD>
<TD ID="ID_566" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">15,953,106</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_92" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Building Products 0.2%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_173" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samwoo EMC Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_931" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">754,800</FONT>
</P>
</TD>
<TD ID="ID_565" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">2,995,292</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_91" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Commercial Services &amp; Supplies 2.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_172" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Insun ENT Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_930" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">377,203</FONT>
</P>
</TD>
<TD ID="ID_929" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6,517,849</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_171" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">S1 Corp. </FONT>
</P>
</TD>
<TD ID="ID_928" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">564,270</FONT>
</P>
</TD>
<TD ID="ID_927" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">24,006,844</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_170" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_564" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">30,524,693</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_90" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Construction &amp; Engineering 0.2%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_169" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samho International Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_926" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">208,430</FONT>
</P>
</TD>
<TD ID="ID_563" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">2,580,449</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_89" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Industrial Conglomerates 0.0%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_168" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Anycell, Inc. (c) (d) (e) (h) </FONT>
</P>
</TD>
<TD ID="ID_925" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,250,000</FONT>
</P>
</TD>
<TD ID="ID_562" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">0</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_88" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Machinery 0.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_167" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Korea Iron &amp; Steel Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_924" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">227,200</FONT>
</P>
</TD>
<TD ID="ID_561" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">4,363,870</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1443" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Information Technology 22.5%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_87" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Communications Equipment 0.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_166" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">INTOPS Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_923" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">162,500</FONT>
</P>
</TD>
<TD ID="ID_560" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">3,746,048</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_86" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Computers &amp; Peripherals 0.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_165" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Daeyang E&amp;C Ltd.* (c)</FONT>
</P>
</TD>
<TD ID="ID_922" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,153,948</FONT>
</P>
</TD>
<TD ID="ID_559" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">9,144,525</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_85" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Electronic Equipment &amp; Instruments 4.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_164" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Ace Digitech Co. Ltd.* </FONT>
</P>
</TD>
<TD ID="ID_921" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">423,300</FONT>
</P>
</TD>
<TD ID="ID_920" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">5,056,154</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_163" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Dae Duck Electronics Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_919" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">360,901</FONT>
</P>
</TD>
<TD ID="ID_918" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2,799,673</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_162" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hankuk Electric Glass Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_917" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">142,400</FONT>
</P>
</TD>
<TD ID="ID_916" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6,145,016</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_161" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Interflex Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_915" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">667,800</FONT>
</P>
</TD>
<TD ID="ID_914" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">13,148,793</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_160" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Jahwa Electronics Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_913" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">779,900</FONT>
</P>
</TD>
<TD ID="ID_912" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6,089,804</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_159" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">NEPES Corp.* </FONT>
</P>
</TD>
<TD ID="ID_911" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">4,990</FONT>
</P>
</TD>
<TD ID="ID_910" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">59,015</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_158" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung SDI Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_909" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">209,956</FONT>
</P>
</TD>
<TD ID="ID_908" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">19,600,050</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_157" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SE Co., Ltd. (c) (d) (e) </FONT>
</P>
</TD>
<TD ID="ID_907" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">636,950</FONT>
</P>
</TD>
<TD ID="ID_906" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,933,323</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_156" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Simm Tech Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_905" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,092,600</FONT>
</P>
</TD>
<TD ID="ID_904" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6,082,384</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_155" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_558" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">60,914,212</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_84" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Internet Software &amp; Services 0.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_154" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">NHN Corp.* </FONT>
</P>
</TD>
<TD ID="ID_903" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">50,400</FONT>
</P>
</TD>
<TD ID="ID_557" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">5,169,529</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_83" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Semiconductors &amp; Semiconductor Equipment 16.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_153" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Mtekvision Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_902" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">83,200</FONT>
</P>
</TD>
<TD ID="ID_901" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2,334,257</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_152" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Phicom Corp. (c) </FONT>
</P>
</TD>
<TD ID="ID_900" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,060,000</FONT>
</P>
</TD>
<TD ID="ID_899" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">6,831,582</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_151" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Electronics Co., Ltd. (i) </FONT>
</P>
</TD>
<TD ID="ID_898" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">340,299</FONT>
</P>
</TD>
<TD ID="ID_897" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">161,231,134</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_150" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Seoul Semiconductor Co., Ltd. (c) </FONT>
</P>
</TD>
<TD ID="ID_896" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">983,125</FONT>
</P>
</TD>
<TD ID="ID_895" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">29,385,634</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_149" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SFA Engineering Corp. (c) </FONT>
</P>
</TD>
<TD ID="ID_894" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">466,200</FONT>
</P>
</TD>
<TD ID="ID_893" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">12,005,567</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_148" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_556" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">211,788,174</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_82" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Software 0.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_147" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Ahnlab, Inc. </FONT>
</P>
</TD>
<TD ID="ID_892" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">119,466</FONT>
</P>
</TD>
<TD ID="ID_555" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">1,971,877</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1442" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Materials 8.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_81" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Chemicals 1.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_146" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">LG Chemical Ltd. </FONT>
</P>
</TD>
<TD ID="ID_891" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">212,486</FONT>
</P>
</TD>
<TD ID="ID_890" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">7,724,776</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_145" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Fine Chemicals Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_889" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">425,000</FONT>
</P>
</TD>
<TD ID="ID_888" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">8,756,256</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_144" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_554" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">16,481,032</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_80" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Construction Materials 0.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_143" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Sungshin Cement Co., Ltd. (c)</FONT>
</P>
</TD>
<TD ID="ID_887" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">276,200</FONT>
</P>
</TD>
<TD ID="ID_553" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">5,232,964</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_79" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Containers &amp; Packaging 0.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_142" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Youlchon Chemical Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_886" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">351,300</FONT>
</P>
</TD>
<TD ID="ID_552" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">4,418,786</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_78" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Metals &amp; Mining 6.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_141" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Dongkuk Steel Mill Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_885" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,170,900</FONT>
</P>
</TD>
<TD ID="ID_884" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">16,147,943</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_140" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">POSCO </FONT>
</P>
</TD>
<TD ID="ID_883" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">376,680</FONT>
</P>
</TD>
<TD ID="ID_882" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">66,330,182</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_139" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SODIFF Advanced Materials Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_881" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">52,041</FONT>
</P>
</TD>
<TD ID="ID_880" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,007,236</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_138" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_551" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">83,485,361</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1441" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Telecommunication Services 3.5%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_77" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Wireless Telecommunication Services </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_137" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SK Telecom Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_879" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">258,420</FONT>
</P>
</TD>
<TD ID="ID_550" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">45,426,654</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1383" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><B>Total Common Stocks</B> (Cost $367,087,583)</FONT>
</P>
</TD>
<TD ID="ID_549" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">1,074,074,167</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1440" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_605" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Preferred Stocks 15.6%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1439" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Consumer Discretionary 5.9%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_76" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Automobiles </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_135" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hyundai Motor Co. 144A (GDR) </FONT>
</P>
</TD>
<TD ID="ID_878" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">3,020,000</FONT>
</P>
</TD>
<TD ID="ID_877" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">50,373,600</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_134" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Hyundai Motor Co. (2nd) </FONT>
</P>
</TD>
<TD ID="ID_876" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">738,593</FONT>
</P>
</TD>
<TD ID="ID_875" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">26,287,551</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_133" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_548" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">76,661,151</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1438" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Consumer Staples 1.3%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_75" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Food Products </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_132" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">CJ Corp. </FONT>
</P>
</TD>
<TD ID="ID_874" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">297,200</FONT>
</P>
</TD>
<TD ID="ID_873" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">12,598,198</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_131" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">CJ Corp. (2nd) </FONT>
</P>
</TD>
<TD ID="ID_872" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">50,335</FONT>
</P>
</TD>
<TD ID="ID_871" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">2,907,970</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_130" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">CJ Corp. (3rd) (Convertible) </FONT>
</P>
</TD>
<TD ID="ID_870" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">30,201</FONT>
</P>
</TD>
<TD ID="ID_869" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,695,509</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_129" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"> </FONT>
</P>
</TD>
<TD ID="ID_547" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">17,201,677</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1437" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Energy 0.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_74" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Oil, Gas &amp; Consumable Fuels </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_128" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">S-Oil Corp. </FONT>
</P>
</TD>
<TD ID="ID_868" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">156,040</FONT>
</P>
</TD>
<TD ID="ID_546" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">9,251,078</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1436" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Financials 2.2%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_73" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Diversified Financial Services 0.5%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_127" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Daishin Securities Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_867" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">665,500</FONT>
</P>
</TD>
<TD ID="ID_545" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">6,377,162</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_72" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Insurance 1.7%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_126" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Fire &amp; Marine Insurance Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_866" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">533,850</FONT>
</P>
</TD>
<TD ID="ID_544" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">22,188,042</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1435" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Information Technology 5.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_71" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Electronic Equipment &amp; Instruments 0.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_125" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung SDI Co., Ltd. </FONT>
</P>
</TD>
<TD ID="ID_865" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">34,318</FONT>
</P>
</TD>
<TD ID="ID_543" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">2,112,932</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_70" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Semiconductors &amp; Semiconductor Equipment 5.0%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_124" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Electronics Co., Ltd. (i) </FONT>
</P>
</TD>
<TD ID="ID_864" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">198,201</FONT>
</P>
</TD>
<TD ID="ID_542" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">64,693,547</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1434" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Materials 0.4%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_69" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#3300d9">Chemicals </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_123" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">LG Chemical Ltd. </FONT>
</P>
</TD>
<TD ID="ID_863" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">193,003</FONT>
</P>
</TD>
<TD ID="ID_541" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">5,091,624</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1382" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><B>Total Preferred Stocks</B> (Cost $38,433,287)</FONT>
</P>
</TD>
<TD ID="ID_540" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">203,577,213</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_14">
<TR>
<TD ID="ID_121" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_57" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">Principal<BR>
Amount ($)</FONT></B>
</P>
</TD>
<TD ID="ID_56" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">Value ($)</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_120" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_862" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_604" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Convertible Bond 0.0%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1433" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Consumer Staples </FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_119" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Haitai Confectionery Loan Certificates, Zero Coupon,
11/28/2009 (d) (f) (g) (Cost $0) </FONT>
</P>
</TD>
<TD ID="ID_861" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">11,658,888</FONT>
</P>
</TD>
<TD ID="ID_539" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">10,185</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_13">
<TR>
<TD ID="ID_118" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_55" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">Shares</FONT></B>
</P>
</TD>
<TD ID="ID_54" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">Value ($)</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_117" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_860" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_603" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Cash Equivalents 0.1%</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_116" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Scudder Cash Management QP Trust, 3.14% (b)
(Cost&nbsp;$1,522,633) </FONT>
</P>
</TD>
<TD ID="ID_859" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><FONT SIZE="-2" COLOR="#000000">1,522,633</FONT>
</P>
</TD>
<TD ID="ID_538" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">1,522,633</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_12">
<TR>
<TD ID="ID_115" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_53" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">% of
Net&nbsp;Assets</FONT></B>
</P>
</TD>
<TD ID="ID_52" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">Value ($)</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_114" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_858" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1381" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><B>Total Investment Portfolio</B> (Cost $407,043,503) (a)</FONT>
</P>
</TD>
<TD ID="ID_536" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        98.3</FONT>
</P>
</TD>
<TD ID="ID_537" ALIGN="RIGHT" VALIGN="BOTTOM">
<P ALIGN="RIGHT"><B><FONT SIZE="-2" COLOR="#000000">1,279,184,198</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1380" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Other Assets and Liabilities, Net </FONT></B>
</P>
</TD>
<TD ID="ID_535" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.7</FONT>
</P>
</TD>
<TD ID="ID_1252" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     21,657,451</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_112" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><B>Net Assets</B></FONT>
</P>
</TD>
<TD ID="ID_534" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        100.0</FONT>
</P>
</TD>
<TD ID="ID_1251" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     1,300,841,649</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">*    Non-income producing security</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(a)  The cost for federal income tax purposes was $408,906,227. At June 30, 2005, net unrealized
appreciation for all securities based on tax cost was $870,277,971. This consisted of aggregate
gross unrealized appreciation for all securities in which there was an excess of value over tax cost
of $875,613,033 and aggregate gross unrealized depreciation for all securities in which there was
an excess of tax cost over value of $5,335,062</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(b)  Scudder Cash Management QP Trust is managed by Deutsche Investment Management Americas
Inc. The rate shown is the annualized seven-day yield at period end</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(c)  Affiliated issuers (see Note I in the Notes to the Financial Statements)</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(d)  Securities valued at fair value by management and approved in good faith following procedures
approved by the Directors, amounted to $1,943,508 (0.1% of net assets at June 30, 2005). Their
values have been estimated by management in the absence of readily ascertainable market values.
However, because of the inherent uncertainty of valuation, those estimated values may differ
significantly from the values that would have been used had a ready market for the securities
existed, and the difference could be material. The cost of these securities at June 30, 2005
aggregated $3,637,411. The securities may also have certain restrictions as to resale</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(e)  The Fund may purchase securities that are subject to legal or contractual restrictions on resale
(&quot;restricted securities&quot;). Restricted securities are securities which have not been registered with the
Securities and Exchange Commission under the Securities Act of 1933. The Fund may be unable to
sell a restricted security and it may be more difficult to determine a market value for a restricted
security. Moreover, if adverse market conditions were to develop during the period between the
Fund's decision to sell a restricted security and the point at which the Fund is permitted or able to
sell such a security, the Fund might obtain a price less favorable than the price that prevailed when
it decided to sell. This investment practice, therefore, could have the effect of increasing the level
of illiquidity of the Fund.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">     A shareholder of SE Co., Ltd. has given the Fund a put option at cost, payable on demand until it
has an initial public offering. Information concerning such private placement securities at June 30,
2005 is as follows:</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_11">
<TR>
<TD ID="ID_1357" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Restricted
Securities</FONT></B>
</P>
</TD>
<TD ID="ID_1315" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Acquisition
Date</FONT></B>
</P>
</TD>
<TD ID="ID_1314" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Cost ($)</FONT></B>
</P>
</TD>
<TD ID="ID_1313" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Value ($)</FONT></B>
</P>
</TD>
<TD ID="ID_1312" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">As a % <BR>
of Net Assets</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_817" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Anycell, Inc.</FONT>
</P>
</TD>
<TD ID="ID_533" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12/22/2000</FONT>
</P>
</TD>
<TD ID="ID_532" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,020,774</FONT>
</P>
</TD>
<TD ID="ID_531" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_530" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_816" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SE Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_529" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12/22/2000</FONT>
</P>
</TD>
<TD ID="ID_528" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,616,637</FONT>
</P>
</TD>
<TD ID="ID_527" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,933,323</FONT>
</P>
</TD>
<TD ID="ID_526" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        0.2</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1379" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Total Restricted Securities</FONT></B>
</P>
</TD>
<TD ID="ID_1250" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     3,637,411</FONT></B>
</P>
</TD>
<TD ID="ID_1249" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     1,933,323</FONT></B>
</P>
</TD>
<TD ID="ID_1248" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     0.2</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(f)  Company in restructuring process, principal only subject to repayment.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(g)  Principal amount stated in Korean won.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(h)  Company liquidated in July 2005</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">(i)  At June 30, 2005, 17.4% of the Fund's net assets is invested in Samsung Electronics&nbsp;Co.,&nbsp;Ltd.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These
securities may be resold in transactions exempt from registration, normally to qualified institutional
buyers.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">ADR: American Depositary Receipt</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">GDR: Global Depositary Receipt </FONT></I>
</P>
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">The accompanying notes are an integral part of the financial statements.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_39">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne270.gif" ALT="kor_NEW_SECTION270"></TD>
<TD ID="ID_1536" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="fins" ID="fins"></A>Financial Statements</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1492" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1491" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_6">
<TR>
<TD ID="ID_602" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Statement of Assets and Liabilities </FONT></B><FONT SIZE="-2" COLOR="#ffffff">as of June 30, 2005</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1432" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Assets</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_815" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Investments in securities, at value:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Unaffiliated issuers (cost $308,004,824)</FONT>
</P>
</TD>
<TD ID="ID_525" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       1,119,427,587</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_237" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Affiliated issuers &#151; Note I (cost $97,516,046)</FONT>
</P>
</TD>
<TD ID="ID_524" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        158,233,978</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_236" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Investment in Scudder Cash Management QP Trust, at value
(cost&nbsp;$1,522,633)</FONT>
</P>
</TD>
<TD ID="ID_523" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,522,633</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_814" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total investments in securities, at value (cost $407,043,503)</FONT>
</P>
</TD>
<TD ID="ID_522" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,279,184,198</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_813" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Korean won, at value (cost $20,952,158)</FONT>
</P>
</TD>
<TD ID="ID_521" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        20,332,139</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_812" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Receivable for investments sold</FONT>
</P>
</TD>
<TD ID="ID_520" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,583,211</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_811" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Dividends receivable</FONT>
</P>
</TD>
<TD ID="ID_519" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,516,596</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_810" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Interest receivable</FONT>
</P>
</TD>
<TD ID="ID_518" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        5,438</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_809" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Other assets</FONT>
</P>
</TD>
<TD ID="ID_517" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        19,017</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_808" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total assets</FONT>
</P>
</TD>
<TD ID="ID_516" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,302,640,599</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1431" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Liabilities</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_807" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Accrued management fee</FONT>
</P>
</TD>
<TD ID="ID_515" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        585,924</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_806" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Other accrued expenses and payables</FONT>
</P>
</TD>
<TD ID="ID_514" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,213,026</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_805" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total liabilities</FONT>
</P>
</TD>
<TD ID="ID_513" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,798,950</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1378" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net assets, at value</FONT></B>
</P>
</TD>
<TD ID="ID_1247" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    1,300,841,649</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1430" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Net Assets</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_804" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net assets consist of:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Undistributed net investment income</FONT>
</P>
</TD>
<TD ID="ID_512" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        8,772,000</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_802" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net unrealized appreciation (depreciation) on:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Investments</FONT>
</P>
</TD>
<TD ID="ID_511" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        872,140,695</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_234" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Won related transactions</FONT>
</P>
</TD>
<TD ID="ID_510" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (639,474)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_801" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Accumulated net realized gain (loss)</FONT>
</P>
</TD>
<TD ID="ID_509" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        8,068,301</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_800" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Cost of 5,307,409 shares held in treasury</FONT>
</P>
</TD>
<TD ID="ID_508" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (113,730,575)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_799" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Paid-in capital</FONT>
</P>
</TD>
<TD ID="ID_507" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        526,230,702</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1377" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net assets, at value</FONT></B>
</P>
</TD>
<TD ID="ID_1246" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    1,300,841,649</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_798" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net Asset Value</FONT></B><FONT SIZE="-2" COLOR="#000000"> per share ($1,300,841,649 &divide; 44,701,493 shares of common
stock issued and outstanding, $.01 par value, 200,000,000 shares
authorized)</FONT>
</P>
</TD>
<TD ID="ID_1245" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    29.10</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">The accompanying notes are an integral part of the financial statements.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_5">
<TR>
<TD ID="ID_601" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Statement of Operations </FONT></B><FONT SIZE="-2" COLOR="#ffffff">for the year ended June 30, 2005</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1429" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Investment Income</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_797" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Income:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Dividends &#151; unaffiliated issuers (net of foreign taxes withheld
of&nbsp;$5,351,078)</FONT>
</P>
</TD>
<TD ID="ID_506" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       28,003,122</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_795" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Dividends &#151; affiliated issuers (net of foreign taxes withheld of $375,245)</FONT>
</P>
</TD>
<TD ID="ID_505" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,274,215</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_794" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Interest (net of foreign taxes withheld of $49,247)</FONT>
</P>
</TD>
<TD ID="ID_504" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        385,462</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_793" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Interest &#151; Scudder Cash Management QP Trust</FONT>
</P>
</TD>
<TD ID="ID_503" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        64,439</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_792" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total Income </FONT>
</P>
</TD>
<TD ID="ID_502" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        30,727,238</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_791" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Expenses:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Management fee</FONT>
</P>
</TD>
<TD ID="ID_501" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        8,061,666</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_789" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Services to shareholders</FONT>
</P>
</TD>
<TD ID="ID_500" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        42,230</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_788" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Custodian and accounting fees</FONT>
</P>
</TD>
<TD ID="ID_499" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,898,644</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_787" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Auditing</FONT>
</P>
</TD>
<TD ID="ID_498" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        148,692</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_786" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Legal</FONT>
</P>
</TD>
<TD ID="ID_497" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,554,360</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_785" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Directors' fees and expenses</FONT>
</P>
</TD>
<TD ID="ID_496" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        237,345</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_784" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Reports to shareholders and annual meeting</FONT>
</P>
</TD>
<TD ID="ID_495" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        450,893</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_783" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Stock exchange listing fees</FONT>
</P>
</TD>
<TD ID="ID_494" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        71,920</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_782" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Other</FONT>
</P>
</TD>
<TD ID="ID_493" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        314,636</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_781" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total expenses, before expense reductions</FONT>
</P>
</TD>
<TD ID="ID_492" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12,780,386</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_780" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Expense reductions</FONT>
</P>
</TD>
<TD ID="ID_491" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (37,284)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_779" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Total expenses, after expense reductions</FONT>
</P>
</TD>
<TD ID="ID_490" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12,743,102</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1376" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net investment income (loss)</FONT></B>
</P>
</TD>
<TD ID="ID_1244" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     17,984,136</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1428" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Realized and Unrealized Gain (Loss) on Investment Transactions</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_778" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net realized gain (loss) from:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Investments &#151; Unaffiliated issuers</FONT>
</P>
</TD>
<TD ID="ID_489" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        17,368,161</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_232" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Investments &#151; Affiliated issuers</FONT>
</P>
</TD>
<TD ID="ID_488" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        148,397</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_231" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Won related transactions</FONT>
</P>
</TD>
<TD ID="ID_487" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        4,017,087</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_777" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_486" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        21,533,645</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_776" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net unrealized appreciation (depreciation) during the period on:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Investments</FONT>
</P>
</TD>
<TD ID="ID_485" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        328,641,895</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_229" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Won related transactions</FONT>
</P>
</TD>
<TD ID="ID_484" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (1,394,566)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_775" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_483" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        327,247,329</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1375" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net gain (loss) on investment transactions</FONT></B>
</P>
</TD>
<TD ID="ID_1243" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     348,780,974</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1374" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net increase (decrease) in net assets resulting from operations</FONT></B>
</P>
</TD>
<TD ID="ID_1242" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    366,765,110</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">The accompanying notes are an integral part of the financial statements.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_4">
<TR>
<TD ID="ID_600" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Statement of Changes in Net Assets</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1427" ALIGN="LEFT" VALIGN="BOTTOM" ROWSPAN="2">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Increase (Decrease) in Net Assets</FONT></B>
</P>
</TD>
<TD ID="ID_1311" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Years Ended June 30,</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1310" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2005</FONT></B>
</P>
</TD>
<TD ID="ID_1309" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2004</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_774" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Operations:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net investment income (loss)</FONT>
</P>
</TD>
<TD ID="ID_482" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       17,984,136</FONT>
</P>
</TD>
<TD ID="ID_481" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       9,496,042</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_772" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net realized gain (loss) on investment transactions</FONT>
</P>
</TD>
<TD ID="ID_480" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        21,533,645</FONT>
</P>
</TD>
<TD ID="ID_479" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        22,465,941</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_771" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net unrealized appreciation (depreciation) during the
period on investment transactions </FONT>
</P>
</TD>
<TD ID="ID_478" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        327,247,329</FONT>
</P>
</TD>
<TD ID="ID_477" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        179,501,753</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_770" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net increase (decrease) in net assets resulting from
operations</FONT>
</P>
</TD>
<TD ID="ID_476" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        366,765,110</FONT>
</P>
</TD>
<TD ID="ID_475" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        211,463,736</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_769" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Distributions to shareholders from:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net investment income</FONT>
</P>
</TD>
<TD ID="ID_474" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (20,115,675)</FONT>
</P>
</TD>
<TD ID="ID_473" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (14,901,571)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_767" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net realized gains</FONT>
</P>
</TD>
<TD ID="ID_472" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (8,940,299)</FONT>
</P>
</TD>
<TD ID="ID_471" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_766" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Fund share transactions:</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Cost of shares repurchased</FONT>
</P>
</TD>
<TD ID="ID_470" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_469" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (3,258,069)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_764" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Cost of shares tendered</FONT>
</P>
</TD>
<TD ID="ID_468" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_467" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (108,814,019)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_763" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net increase (decrease) in net assets from Fund share
transactions</FONT>
</P>
</TD>
<TD ID="ID_466" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_465" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (112,072,088)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1373" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Increase (decrease) in net assets</FONT></B>
</P>
</TD>
<TD ID="ID_464" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        337,709,136</FONT>
</P>
</TD>
<TD ID="ID_463" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        84,490,077</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_762" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net assets at beginning of period</FONT>
</P>
</TD>
<TD ID="ID_462" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        963,132,513</FONT>
</P>
</TD>
<TD ID="ID_461" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        878,642,436</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_761" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net assets at end of period (including undistributed
net investment income of $8,772,000 and $6,135,998,
respectively)</FONT>
</P>
</TD>
<TD ID="ID_1241" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    1,300,841,649</FONT></B>
</P>
</TD>
<TD ID="ID_1240" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    963,132,513</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1426" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Other Information</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_760" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Shares outstanding at beginning of period</FONT>
</P>
</TD>
<TD ID="ID_460" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        44,701,493</FONT>
</P>
</TD>
<TD ID="ID_459" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        49,863,602</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_759" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Shares repurchased</FONT>
</P>
</TD>
<TD ID="ID_458" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_457" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (195,700)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_758" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Shares tendered</FONT>
</P>
</TD>
<TD ID="ID_456" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_455" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (4,966,409)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_757" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net increase (decrease) in Fund shares</FONT>
</P>
</TD>
<TD ID="ID_454" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_453" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (5,162,109)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_756" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Shares outstanding at end of period</FONT>
</P>
</TD>
<TD ID="ID_452" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        44,701,493</FONT>
</P>
</TD>
<TD ID="ID_451" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        44,701,493</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT">
</P>
<P ALIGN="CENTER"><I><FONT SIZE="-2" COLOR="#000000">The accompanying notes are an integral part of the financial statements.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_38">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne260.gif" ALT="kor_NEW_SECTION260"></TD>
<TD ID="ID_1535" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="high" ID="high"></A>Financial Highlights</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1490" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1489" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_7">
<TR>
<TD ID="ID_599" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="MIDDLE">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Years Ended June 30,</FONT></B>
</P>
</TD>
<TD ID="ID_64" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="MIDDLE">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">2005</FONT></B>
</P>
</TD>
<TD ID="ID_63" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="MIDDLE">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">2004</FONT></B>
</P>
</TD>
<TD ID="ID_62" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="MIDDLE">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">2003</FONT></B>
</P>
</TD>
<TD ID="ID_61" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="MIDDLE">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">2002</FONT></B>
</P>
</TD>
<TD ID="ID_60" BGCOLOR="#000000" ALIGN="CENTER" VALIGN="MIDDLE">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#ffffff">2001</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1425" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="6">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Per Share Operating Performance</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1372" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net asset value, beginning of period</FONT></B>
</P>
</TD>
<TD ID="ID_1239" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    21.55</FONT></B>
</P>
</TD>
<TD ID="ID_1238" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    17.62</FONT></B>
</P>
</TD>
<TD ID="ID_1237" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    20.20</FONT></B>
</P>
</TD>
<TD ID="ID_1236" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    13.01</FONT></B>
</P>
</TD>
<TD ID="ID_1235" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    20.04</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_240" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Income (loss) from investment operations</FONT></I>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net investment income (loss)<SUP>a</SUP></FONT>
</P>
</TD>
<TD ID="ID_450" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .40</FONT>
</P>
</TD>
<TD ID="ID_449" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .20</FONT>
</P>
</TD>
<TD ID="ID_448" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .17</FONT>
</P>
</TD>
<TD ID="ID_447" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .11</FONT>
</P>
</TD>
<TD ID="ID_446" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .17</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_227" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net realized and unrealized gain (loss) on
investment transactions</FONT>
</P>
</TD>
<TD ID="ID_445" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        7.80</FONT>
</P>
</TD>
<TD ID="ID_444" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        3.90</FONT>
</P>
</TD>
<TD ID="ID_443" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (1.90)</FONT>
</P>
</TD>
<TD ID="ID_442" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        7.20</FONT>
</P>
</TD>
<TD ID="ID_441" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (5.61)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_111" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Total from investment operations</FONT></B>
</P>
</TD>
<TD ID="ID_440" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        8.20</FONT>
</P>
</TD>
<TD ID="ID_439" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        4.10</FONT>
</P>
</TD>
<TD ID="ID_438" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (1.73)</FONT>
</P>
</TD>
<TD ID="ID_437" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        7.31</FONT>
</P>
</TD>
<TD ID="ID_436" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (5.44)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_239" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">Less distributions from:</FONT></I>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net investment income</FONT>
</P>
</TD>
<TD ID="ID_435" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.45)</FONT>
</P>
</TD>
<TD ID="ID_434" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.30)</FONT>
</P>
</TD>
<TD ID="ID_433" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.18)</FONT>
</P>
</TD>
<TD ID="ID_432" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_431" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.18)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_225" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net realized gains on investment
transactions</FONT>
</P>
</TD>
<TD ID="ID_430" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.20)</FONT>
</P>
</TD>
<TD ID="ID_429" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_428" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.67)</FONT>
</P>
</TD>
<TD ID="ID_427" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.12)</FONT>
</P>
</TD>
<TD ID="ID_426" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (1.41)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_110" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Total distributions</FONT></B>
</P>
</TD>
<TD ID="ID_425" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.65)</FONT>
</P>
</TD>
<TD ID="ID_424" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.30)</FONT>
</P>
</TD>
<TD ID="ID_423" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.85)</FONT>
</P>
</TD>
<TD ID="ID_422" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (.12)</FONT>
</P>
</TD>
<TD ID="ID_421" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (1.59)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_755" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">NAV accretion resulting from repurchases,
shares tendered and reinvestment of
distributions for shares at value</FONT>
</P>
</TD>
<TD ID="ID_420" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_419" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .13</FONT>
</P>
</TD>
<TD ID="ID_418" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .00<SUP>b</SUP></FONT>
</P>
</TD>
<TD ID="ID_417" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .00<SUP>b</SUP></FONT>
</P>
</TD>
<TD ID="ID_416" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1371" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Net asset value, end of period</FONT></B>
</P>
</TD>
<TD ID="ID_1234" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    29.10</FONT></B>
</P>
</TD>
<TD ID="ID_1233" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    21.55</FONT></B>
</P>
</TD>
<TD ID="ID_1232" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    17.62</FONT></B>
</P>
</TD>
<TD ID="ID_1231" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    20.20</FONT></B>
</P>
</TD>
<TD ID="ID_1230" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    13.01</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1370" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Market value, end of period</FONT></B>
</P>
</TD>
<TD ID="ID_1229" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    27.35</FONT></B>
</P>
</TD>
<TD ID="ID_1228" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    18.85</FONT></B>
</P>
</TD>
<TD ID="ID_1227" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    14.99</FONT></B>
</P>
</TD>
<TD ID="ID_1226" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    16.44</FONT></B>
</P>
</TD>
<TD ID="ID_1225" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">$    10.58</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1424" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="6">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Total Return</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_754" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Per share net asset value (%)<SUP>c</SUP></FONT>
</P>
</TD>
<TD ID="ID_415" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        38.66</FONT>
</P>
</TD>
<TD ID="ID_414" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        24.15</FONT>
</P>
</TD>
<TD ID="ID_413" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (8.34)</FONT>
</P>
</TD>
<TD ID="ID_412" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        56.39</FONT>
</P>
</TD>
<TD ID="ID_411" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (25.01)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_753" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Per share market value (%)<SUP>c</SUP></FONT>
</P>
</TD>
<TD ID="ID_410" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        49.06</FONT>
</P>
</TD>
<TD ID="ID_409" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        27.66</FONT>
</P>
</TD>
<TD ID="ID_408" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (4.29)</FONT>
</P>
</TD>
<TD ID="ID_407" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        56.71</FONT>
</P>
</TD>
<TD ID="ID_406" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (13.16)</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1423" ALIGN="LEFT" VALIGN="BOTTOM" COLSPAN="6">
<P ALIGN="LEFT"><B><FONT SIZE="-1" COLOR="#000000">Ratios to Average Net Assets and Supplemental Data</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_752" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Net assets, end of period ($&nbsp;millions)</FONT>
</P>
</TD>
<TD ID="ID_405" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,301</FONT>
</P>
</TD>
<TD ID="ID_404" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        963</FONT>
</P>
</TD>
<TD ID="ID_403" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        879</FONT>
</P>
</TD>
<TD ID="ID_402" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,009</FONT>
</P>
</TD>
<TD ID="ID_401" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        651</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_751" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Ratio of expenses&nbsp;(%)</FONT>
</P>
</TD>
<TD ID="ID_400" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.13</FONT>
</P>
</TD>
<TD ID="ID_399" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.27</FONT>
</P>
</TD>
<TD ID="ID_398" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.26</FONT>
</P>
</TD>
<TD ID="ID_397" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.21</FONT>
</P>
</TD>
<TD ID="ID_396" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.23<SUP>d</SUP></FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_750" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Ratio of net investment income (loss)&nbsp;(%)</FONT>
</P>
</TD>
<TD ID="ID_395" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.58</FONT>
</P>
</TD>
<TD ID="ID_394" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .94</FONT>
</P>
</TD>
<TD ID="ID_393" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .99</FONT>
</P>
</TD>
<TD ID="ID_392" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        .69</FONT>
</P>
</TD>
<TD ID="ID_391" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1.18</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_749" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Portfolio turnover rate&nbsp;(%)</FONT>
</P>
</TD>
<TD ID="ID_390" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        10</FONT>
</P>
</TD>
<TD ID="ID_389" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        20</FONT>
</P>
</TD>
<TD ID="ID_388" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        7</FONT>
</P>
</TD>
<TD ID="ID_387" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        18</FONT>
</P>
</TD>
<TD ID="ID_386" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        40</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>a</SUP> Based on average shares outstanding during the period.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>b</SUP> Amount is less than $.005 per share.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000"><SUP>c</SUP> Total return based on net asset value reflects changes in the Fund's net asset value during the
period. Total return based on market value reflects changes in market value. Each figure includes
reinvestments of distributions. These figures will differ depending upon the level of any discount
from, or premium to, net asset value at which the Fund's shares trade during the period.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">d    Ratio of expenses before expense reductions was 1.24%.</FONT></I>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_37">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne250.gif" ALT="kor_NEW_SECTION250"></TD>
<TD ID="ID_1534" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="notes" ID="notes"></A>Notes to Financial Statements     </FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1488" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1487" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">A. Significant Accounting Policies</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Korea Fund, Inc. (the &quot;Fund&quot;) is registered under the Investment Company Act
of 1940, as amended (the &quot;1940 Act&quot;), as a closed-end, non-diversified management
investment company organized as a Maryland corporation.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Fund's financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America which require the use of
management estimates. Actual results could differ from those estimates. The policies
described below are followed consistently by the Fund in the preparation of its
financial statements.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Security Valuation.</FONT></B> Investments are stated at value determined as of the close of
regular trading on the New York Stock Exchange on each day the exchange is open
for trading. Equity securities are valued at the most recent sale price or official closing
price reported on the exchange (US or foreign) or over-the-counter market on which
the security is traded most extensively. Securities for which no sales are reported are
valued at the calculated mean between the most recent bid and asked quotations on
the relevant market or, if a mean cannot be determined, at the most recent bid
quotation. Debt securities are valued by independent pricing services approved by the
Directors of the Fund. If the pricing services are unable to provide valuations,
securities are valued at the most recent bid quotation or evaluated price, as applicable,
obtained from a broker-dealer. Such services may use various pricing techniques
which take into account appropriate factors such as yield, quality, coupon rate,
maturity, type of issue, trading characteristics and other data, as well as broker quotes.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Money market instruments purchased with an original or remaining maturity of sixty
days or less, maturing at par, are valued at amortized cost. Investments in open-end
investment companies and Scudder Cash Management QP Trust are valued at their
net asset value each business day.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Securities and other assets for which market quotations are not readily available or for
which the above valuation procedures are deemed not to reflect fair value are valued
in a manner that is intended to reflect fair value as determined in accordance with
procedures approved by the Directors. The Fund may use a fair valuation model to
value Korean equity securities in order to adjust for events which may occur between
the close of the Korean stock exchanges and the close of the New York Stock
Exchange.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Foreign Currency Translations.</FONT></B> The books and records of the Fund are maintained
in US dollars. Investment securities and other assets and liabilities denominated in a
foreign currency are translated into US dollars at the prevailing exchange rates at
period end. Purchases and sales of investment securities, income and expenses are
translated into US dollars at the prevailing exchange rates on the respective dates of
the transactions.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Net realized and unrealized gains and losses on foreign currency transactions
represent net gains and losses between trade and settlement dates on securities
transactions, the disposition of forward foreign currency exchange contracts and
foreign currencies, and the difference between the amount of net investment income
accrued and the US dollar amount actually received. That portion of both realized
and unrealized gains and losses on investments that results from fluctuations in
foreign currency exchange rates is not separately disclosed but is included with net
realized and unrealized gains and losses on investment securities.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">At June 30, 2005, the exchange rate for Korean won was W 1030.92 to US $1.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Taxes.</FONT></B> The Fund's policy is to comply with the requirements of the Internal Revenue
Code, as amended, which are applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders. Accordingly, the Fund paid no
federal income taxes and no federal income tax provision was required. </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Under the United States-Korea Income Tax Treaty (the &quot;Treaty&quot;), as presently in
effect, the government of Korea imposes a nonrecoverable withholding tax and
resident tax aggregating 16.5% on dividends and 13.2% on interest earned by the
Fund from Korean issuers. Under the Treaty, there is no Korean withholding tax on
realized capital gains.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Distribution of Income and Gains.</FONT></B> Net investment income of the Fund is declared
and distributed to shareholders annually. Net realized gains from investment
transactions, in excess of available capital loss carryforwards, would be taxable to the
Fund if not distributed, and, therefore, will be distributed to shareholders at least
annually.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The timing and characterization of certain income and capital gains distributions are
determined annually in accordance with federal tax regulations which may differ
from accounting principles generally accepted in the United States of America. These
differences primarily relate to investments in passive foreign investment companies,
foreign denominated securities and certain securities sold at a loss. As a result, net
investment income (loss) and net realized gain (loss) on investment transactions for a
reporting period may differ significantly from distributions during such period.
Accordingly, the Fund may periodically make reclassifications among certain of its
capital accounts without impacting the net asset value of the Fund. </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">At June 30, 2005, the Fund's components of distributable earnings (accumulated
losses) on a tax basis were as follows:</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_21">
<TR>
<TD ID="ID_748" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Undistributed ordinary income*</FONT>
</P>
</TD>
<TD ID="ID_385" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       8,772,000</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_747" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Undistributed net long-term capital gains</FONT>
</P>
</TD>
<TD ID="ID_384" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       9,931,024</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_746" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Unrealized appreciation (depreciation) on investments</FONT>
</P>
</TD>
<TD ID="ID_383" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       870,277,971</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><FONT COLOR="#000000">In addition, the tax character of distributions paid to shareholders by the Fund is
summarized as follows:</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_20">
<TR>
<TD ID="ID_745" ALIGN="LEFT" VALIGN="BOTTOM" ROWSPAN="2">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1308" ALIGN="CENTER" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Years Ended June 30,</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1307" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2005</FONT></B>
</P>
</TD>
<TD ID="ID_1306" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">2004</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_744" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Distributions from ordinary income*</FONT>
</P>
</TD>
<TD ID="ID_382" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       20,115,675</FONT>
</P>
</TD>
<TD ID="ID_381" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       14,901,571</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_743" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Distributions from long-term capital gains</FONT>
</P>
</TD>
<TD ID="ID_380" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       8,940,299</FONT>
</P>
</TD>
<TD ID="ID_379" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">$       &#151;</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">*    For tax purposes short-term capital gains distributions are considered ordinary income distributions.</FONT></I>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Dividend Income.</FONT></B> Dividend income is recorded on the ex-dividend date net of
foreign withholding taxes. Korean-based corporations have generally adopted
calendar year-ends, and their interim and final corporate actions are normally
approved, finalized and announced by their boards of directors and shareholders
in&nbsp;the first and third quarters of each calendar year. Generally, estimates of their
dividends are accrued by management on the ex-dividend date in the prior December
and/or June period end. These dividend announcements are recorded by the Fund on
such ex-dividend dates. Any subsequent adjustments thereto by Korean corporations
are recorded when announced. Presently, dividend income from Korean equity
investments is earned primarily in the last calendar quarter of each year, and will be
received primarily in the first calendar quarter of each year. Certain other dividends
and related withholding taxes, if applicable, from Korean securities may be recorded
subsequent to the ex-dividend date as soon as the Fund is informed of such dividends
and taxes.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Contingencies.</FONT></B> In the normal course of business, the Fund may enter into contracts
with service providers that contain general indemnification clauses. The Fund's
maximum exposure under these arrangements is unknown as this would involve
future claims that may be made against the Fund that have not yet been made.
However, based on experience, the Fund expects the risk of loss to be remote.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Other.</FONT></B> Investment transactions are accounted for on a trade date plus one basis for
daily net asset value calculations. However, for financial reporting purposes,
investment security transactions are reported on trade date. Interest income is
recorded on the accrual basis. Realized gains and losses from investment transactions
are recorded on an identified cost basis.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">B. Purchases and Sales of Securities</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">During the year ended June 30, 2005, purchases and sales of investment securities
(excluding short-term investments) aggregated $140,893,361 and $105,052,223,
respectively.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">C. Related Parties</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Management Agreement.</FONT></B> Under the Management Agreement with Deutsche
Investment Management Americas Inc. (&quot;DeIM&quot; or the &quot;Manager&quot;), an indirect,
wholly owned subsidiary of Deutsche Bank AG, the Manager directs the investments
of the Fund in accordance with its investment objectives, policies and restrictions.
The Manager determines the securities, instruments and other contracts relating to
investments to be purchased, sold or entered into by the Fund. In addition to
portfolio management services, the Manager provides certain administrative services
in accordance with the Management Agreement. The management fee payable
monthly under the Agreement through November 30, 2004 was equal to an annual
rate of 1.15% of the first $50,000,000 of the Fund's month-end net assets, 1.10% of
the next $50,000,000 of such net assets, 1% of the next $250,000,000 of such net
assets, 0.95% of the next $400,000,000 of such net assets, 0.90% of the next
$300,000,000 of such net assets, and 0.85% of such net assets in excess of
$1,050,000,000 of the Fund's month-end net assets. Effective December 1, 2004, the
Management Agreement was amended. Under the amended Management
Agreement, the management fee payable is equal to an annual rate of 0.60% on the
first $250,000,000 of the Fund's month-end net assets, 0.575% on the next
$250,000,000 of such net assets, 0.55% on the next $250,000,000 of such net assets,
0.525% on the next $250,000,000 of such net assets, and 0.50% of such net assets in
excess of $1,000,000,000. The market value of Hankang Restructuring Fund, which
was managed by the Manager before its sale during the year at a realized loss of
$225,730, had been excluded from the net assets used to calculate the management
fee. For the year ended June 30, 2005, the Manager waived a portion of&nbsp;its fee
amounting to $30,362, and the portion charged amounted to $8,031,304 which was
equivalent to an annual effective rate of 0.71%&nbsp;of the Fund's average month-end net
assets.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Deutsche Investment Trust Management Company Limited (&quot;DeITMC&quot;), also a
wholly owned subsidiary of Deutsche Bank AG, serves as subadvisor to the Fund.
DeITMC renders investment advisory and management services with regard to the
Fund's portfolio. From time to time, DeITMC makes specific investment
recommendations, which then are evaluated by DeIM's portfolio managers in light of
their own expertise and information from other sources in making investment
decisions for the Fund.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Service Provider Fees.</FONT></B> Scudder Investments Service Company (&quot;SISC&quot;), an affiliate
of the Manager, is the&nbsp;transfer, dividend-paying and shareholder service agent for the
Fund. Pursuant to a sub-transfer agency agreement between SISC and DST Systems,
Inc. (&quot;DST&quot;), SISC has delegated certain transfer agent and dividend- paying agent
functions to DST. SISC compensates DST out of the shareholder servicing fee it
receives from the Fund. For the year ended June 30, 2005, the amount charged to
the Fund by SISC aggregated $16,200, of which $5,375 is unpaid.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Scudder Service Corporation (&quot;SSC&quot;), a subsidiary of the Manager, is the shareholder
communications agent of the Fund. For the year ended June 30, 2005 the amount
charged to the Fund by SSC aggregated $15,000, of which $4,961 is unpaid.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Scudder Fund Accounting Corporation (&quot;SFAC&quot;), also a subsidiary of the Manager,
is responsible for determining the daily net asset value per share and maintaining
the&nbsp;portfolio and general accounting records of the Fund. Pursuant to a
sub-accounting agreement between SFAC and State Street Bank and Trust Company
(&quot;SSB&quot;), SFAC has delegated all accounting functions to SSB. SFAC compensates
SSB out of the accounting fee it receives from the Fund. For the year ended June 30,
2005, the amount charged to the Fund by SFAC aggregated $509,491, of
which&nbsp;$86,912 is unpaid.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Directors' Fees and Expenses.</FONT></B> The Fund pays each Director not affiliated with the
Manager retainer fees plus specified amounts for attended board and committee
meetings.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000"><B><FONT SIZE="-1">Scudder Cash Management QP Trust.</FONT></B> Pursuant to an Exemptive Order issued by
the SEC, the Fund may invest in the Scudder Cash Management QP Trust (the
&quot;QP&nbsp;Trust&quot;) and other affiliated funds managed by the Manager. The QP Trust seeks
to provide as high a level of current income as is consistent with the preservation of
capital and the maintenance of liquidity. The QP Trust does not pay the Manager a
management fee for the affiliated funds' investments in the QP Trust.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">D. Foreign Investment and Exchange Controls in Korea</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Foreign Exchange Transaction Act, the Presidential Decree relating to such Act
and the regulations of the Minister of Finance and Economy issued thereunder
impose certain limitations and controls which generally affect foreign investors in
Korea. The Fund obtained from the Minister of Finance and Economy a license to
invest in Korean securities and to repatriate income received from dividends and
interest earned on, and net realized capital gain from, its investments in Korean
securities or to repatriate from investment principal up to 10% of the net asset value
(taken at current value) of the Fund (except upon termination of the Fund, or for
expenses in excess of Fund income, in which case the foregoing restriction shall not
apply). Under the Foreign Exchange Transaction Act, the Minister of Finance and
Economy has the power, with prior public notice of scope and duration, to suspend
all or a part of foreign exchange transactions when emergency measures are deemed
necessary in case of radical change in the international or domestic economic
situation. The Fund could be adversely affected by delays in, or the refusal to grant,
any required governmental approval for such transactions.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">In order to complete its tender offer, however, the Fund relinquished its license from
the Korean Ministry of Finance and Economy and was advised by the Ministry of
Finance and Economy that the surrender of the license has been completed on
August 19, 2005. The Fund had engaged in negotiations with the Korean Ministry
of Finance and Economy concerning the feasibility of the Fund's license being
amended to allow the Fund to repatriate more than 10% of Fund capital. However,
the Ministry of Finance and Economy advised the Fund that the license cannot be
amended as a result of a change in the Korean regulations. As a result of the
relinquishment of the license, the Fund will be subject to the Korean securities
transaction tax equal to 0.3% of the fair market value of any portfolio securities
transferred by the Fund on the Korea Exchange and 0.5% of the fair market value of
any portfolio securities transferred outside of the Korea Exchange. The
relinquishment will not otherwise affect the Fund's operations. </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Various restrictions currently apply with respect to investing in equity securities of
Korean banks and certain designated public corporations and telecommunications
corporations listed on the Korea Exchange. As of June 30, 2005, the Fund and its
affiliates would require the approval of the Financial Supervisory Commission
(the&nbsp;&quot;FSC&quot;) before obtaining aggregate beneficial ownership of more than 10% of
the outstanding voting shares of a national bank such as Kookmin Bank or 15% of
the&nbsp;outstanding voting shares of a regional bank such as Jeonbuk Bank, and
additional FSC approvals would be required before specified higher ownership
percentages could be exceeded. With respect to certain public and
telecommunications corporations, the Fund's holdings in each of GS Home
Shopping, Inc. and SK&nbsp;Telecom Co., Ltd. were subject to a foreign ownership limit
of 49% as of June&nbsp;30,&nbsp;2005.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">E. Investing in the Korean Market</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Investing in the Korean market may involve special risks and considerations not
typically associated with investing in the United States of America. These risks
include revaluation of currency, high rates of inflation, Korean taxes, repatriation
restrictions on income and capital, corporate bankruptcy and future adverse political,
social and economic developments. Moreover, securities issued in this market may be
less liquid, subject to government ownership controls, delayed settlements and their
prices more volatile than those of comparable securities in the United States of
America.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">F. Ownership of the Fund</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">At June 30, 2005, The President and Fellows of Harvard College and City of London
Investment Group PLC held approximately 22% and 10%, respectively, of the
outstanding shares of the Fund.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">G. Line of Credit</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Fund and several other affiliated funds (the &quot;Participants&quot;) share in a $1.1&nbsp;billion
revolving credit facility administered by J.P. Morgan Chase Bank for temporary or
emergency purposes that otherwise might require the untimely disposition of
securities. The Participants are charged an annual commitment fee which is allocated,
based upon net assets, among each of the Participants. Interest is calculated at the
Federal Funds Rate plus 0.5 percent. The Fund may borrow up to a maximum of
5&nbsp;percent of its net assets under the agreement.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">H. Expense Reductions</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">For the year ended June 30, 2005, the Manager agreed to reimburse the Fund
$6,922, which represents a portion of the fee savings expected to be realized by the
Manager related to the outsourcing by the Manager of certain administrative services
to an unaffiliated service provider.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">I. Transactions in Securities of Affiliated Issuers</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">An affiliated issuer is a company in which the Fund has ownership of at least 5% of
the voting securities. A summary of the Fund's transactions during the year ended
June 30, 2005 with companies which are or were affiliates is as follows:</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_10">
<TR>
<TD ID="ID_1356" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Affiliate</FONT></B>
</P>
</TD>
<TD ID="ID_1305" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Common/Preferred
Shares</FONT></B>
</P>
</TD>
<TD ID="ID_1304" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Purchases
Cost&nbsp;($)</FONT></B>
</P>
</TD>
<TD ID="ID_1303" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Sales
Cost&nbsp;($)</FONT></B>
</P>
</TD>
<TD ID="ID_1302" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Realized
Gain/
(Loss)&nbsp;($)</FONT></B>
</P>
</TD>
<TD ID="ID_1301" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Dividend
Income
($)*</FONT></B>
</P>
</TD>
<TD ID="ID_1300" ALIGN="CENTER" VALIGN="BOTTOM">
<P ALIGN="CENTER"><B><FONT SIZE="-2" COLOR="#000000">Value ($)</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_742" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Anycell, Inc.</FONT>
</P>
</TD>
<TD ID="ID_378" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,250,000</FONT>
</P>
</TD>
<TD ID="ID_377" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_376" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_375" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_374" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_373" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_741" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">BYC Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_372" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        39,530</FONT>
</P>
</TD>
<TD ID="ID_371" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_370" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_369" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_368" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        26,568</FONT>
</P>
</TD>
<TD ID="ID_367" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,257,028</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_740" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Crown
Confectionary
Co., Ltd</FONT>
</P>
</TD>
<TD ID="ID_366" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        95,600</FONT>
</P>
</TD>
<TD ID="ID_365" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12,844,963</FONT>
</P>
</TD>
<TD ID="ID_364" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_363" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_362" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_361" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        14,702,465</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_739" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Daeyang E&amp;C Ltd.</FONT>
</P>
</TD>
<TD ID="ID_360" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,153,948</FONT>
</P>
</TD>
<TD ID="ID_359" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_358" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_357" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_356" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_355" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        9,144,525</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_738" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Interflex Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_354" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        667,800</FONT>
</P>
</TD>
<TD ID="ID_353" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        8,039,630</FONT>
</P>
</TD>
<TD ID="ID_352" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_351" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_350" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        96,178</FONT>
</P>
</TD>
<TD ID="ID_349" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        13,148,793</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_737" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Jeonbuk Bank</FONT>
</P>
</TD>
<TD ID="ID_348" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,787,695</FONT>
</P>
</TD>
<TD ID="ID_347" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_346" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_345" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_344" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        389,799</FONT>
</P>
</TD>
<TD ID="ID_343" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        15,311,560</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_736" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Nam Yang Dairy
Products Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_342" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        33,641</FONT>
</P>
</TD>
<TD ID="ID_341" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_340" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        3,848,420</FONT>
</P>
</TD>
<TD ID="ID_339" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,696,316</FONT>
</P>
</TD>
<TD ID="ID_338" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        39,578</FONT>
</P>
</TD>
<TD ID="ID_337" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        15,489,286</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_735" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Oriental Fire &amp;
Marine Insurance
Co.</FONT>
</P>
</TD>
<TD ID="ID_336" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        584,860</FONT>
</P>
</TD>
<TD ID="ID_335" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_334" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_333" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_332" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        570,874</FONT>
</P>
</TD>
<TD ID="ID_331" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12,983,002</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_734" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Phicom Corp.</FONT>
</P>
</TD>
<TD ID="ID_330" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,060,000</FONT>
</P>
</TD>
<TD ID="ID_329" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        4,401,309</FONT>
</P>
</TD>
<TD ID="ID_328" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_327" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_326" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        101,776</FONT>
</P>
</TD>
<TD ID="ID_325" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        6,831,582</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_733" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samsung Climate
Control Co.,&nbsp;Ltd.</FONT>
</P>
</TD>
<TD ID="ID_324" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        827,630</FONT>
</P>
</TD>
<TD ID="ID_323" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_322" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_321" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_320" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        25,410</FONT>
</P>
</TD>
<TD ID="ID_319" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        4,467,342</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_732" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Samwoo EMC Co.,
Ltd.</FONT>
</P>
</TD>
<TD ID="ID_318" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        754,800</FONT>
</P>
</TD>
<TD ID="ID_317" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,092,375</FONT>
</P>
</TD>
<TD ID="ID_316" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_315" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_314" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        72,472</FONT>
</P>
</TD>
<TD ID="ID_313" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        2,995,292</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_731" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SE Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_312" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        636,950</FONT>
</P>
</TD>
<TD ID="ID_311" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_310" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_309" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_308" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_307" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,933,323</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_730" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Seoul
Semiconductor
Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_306" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        983,125</FONT>
</P>
</TD>
<TD ID="ID_305" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        4,775,077</FONT>
</P>
</TD>
<TD ID="ID_304" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        650,174</FONT>
</P>
</TD>
<TD ID="ID_303" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        285,294</FONT>
</P>
</TD>
<TD ID="ID_302" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        284,350</FONT>
</P>
</TD>
<TD ID="ID_301" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        29,385,634</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_729" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">SFA Engineering
Corp.</FONT>
</P>
</TD>
<TD ID="ID_300" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        466,200</FONT>
</P>
</TD>
<TD ID="ID_299" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        5,302,292</FONT>
</P>
</TD>
<TD ID="ID_298" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_297" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_296" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        335,717</FONT>
</P>
</TD>
<TD ID="ID_295" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12,005,567</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_728" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Sungshin Cement
Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_294" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        276,200</FONT>
</P>
</TD>
<TD ID="ID_293" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        5,496,477</FONT>
</P>
</TD>
<TD ID="ID_292" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_291" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_290" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        331,493</FONT>
</P>
</TD>
<TD ID="ID_289" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        5,232,964</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_727" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Taegu
Department Store
Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_288" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        1,336,800</FONT>
</P>
</TD>
<TD ID="ID_287" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        4,316,669</FONT>
</P>
</TD>
<TD ID="ID_286" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_285" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_284" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_283" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        12,345,615</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_726" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Telephus Co., Ltd.</FONT>
</P>
</TD>
<TD ID="ID_282" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_281" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_280" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        86,495</FONT>
</P>
</TD>
<TD ID="ID_279" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        (2,833,213)</FONT>
</P>
</TD>
<TD ID="ID_278" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        &#151;</FONT>
</P>
</TD>
<TD ID="ID_277" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">        N/A<SUP>**</SUP></FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1369" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
<TD ID="ID_1224" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     </FONT></B>
</P>
</TD>
<TD ID="ID_1223" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     47,268,792</FONT></B>
</P>
</TD>
<TD ID="ID_1222" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     4,585,089</FONT></B>
</P>
</TD>
<TD ID="ID_1221" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     148,397</FONT></B>
</P>
</TD>
<TD ID="ID_1220" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     2,274,215</FONT></B>
</P>
</TD>
<TD ID="ID_1219" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">     158,233,978</FONT></B>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">*    Net of foreign taxes withheld.</FONT></I>
</P>
<P ALIGN="LEFT"><I><FONT SIZE="-2" COLOR="#000000">**   Not an affiliate at June 30, 2005</FONT></I>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">J. Share Repurchases</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Fund has a share repurchase plan to effect periodic repurchases of its shares in
the open market from time to time when the Fund's shares trade at a discount to
their net asset value per share. The Fund did not repurchase shares during the year
ended June 30, 2005. During the year ended June 30, 2004, the Fund purchased
195,700 shares of common stock on the open market at a total cost of $3,258,069.
The average discount of these purchases, comparing the purchase price to the net
asset value at the time of purchase, was 16.0%. These shares are held in treasury.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">K. Tender Offer </FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">On January 21, 2004, the Fund's Board of Directors approved a tender offer for the
period January 23, 2004 through February 23, 2004 for up to 10% of its outstanding
shares of common stock for cash, at a price per share equal to 95% of the net asset
value on the business day after the day on which the offer expires. The tender offer
was fully subscribed for the maximum limit of 10% of Fund shares outstanding
aggregating 4,966,409 shares at a total cost of $108,814,019 ($21.91 per share). The
discount of these purchases of tendered shares comparing the purchase price to the
net asset value at the time of purchase was 5%. These shares are also held in treasury.
There will be no further tender offers under this program.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">In accordance with the Fund's Board of Directors approval on December 15, 2004,
of an offer to repurchase 50% of the Fund's outstanding shares, on July 8, 2005, the
Fund commenced a tender offer for up to 22,350,747 of its shares, representing
approximately 50% of its issued and outstanding shares of common stock, in
exchange for portfolio securities of the Fund at a price per share equal to 98% on the
net asset value per share as of the day after the offer expires. Shareholders exchanging
their shares in the offer will receive a pro rata share of the Fund's portfolio. The
tender offer will remain open through August 19, 2005 unless extended. The tender
offer is being conducted in order to provide shareholders with an alternative source of
liquidity for their investment in Fund shares and as part of the Fund's continuous
efforts to provide additional value to shareholders.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The program for future repurchase offers consists of semiannual offers, each to
repurchase 10% of the Fund's shares then outstanding, at a price of 98% of net asset
value on the day after expiration of the offer, in the three calendar years following
completion of the initial offer. As with the initial offer, participating holders would
be paid in kind, by receiving a pro rata share of the Fund's portfolio. Each of these
subsequent offers would be made, subject to regulatory approvals, fiduciary and other
applicable requirements, if the Fund's shares traded on the New York Stock Exchange
at an average weekly discount from net asset value greater than 5% during a 13-week
measuring period ending the last day of the preceding half-year.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">There can be no assurance that the approvals needed for the repurchase offers will be
obtained, or that any action proposed or adopted by the Directors will reduce or
eliminate the discount from net asset value at which the Fund's shares trade.</FONT>
</P>
<P ALIGN="LEFT">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_36">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne240.gif" ALT="kor_NEW_SECTION240"></TD>
<TD ID="ID_1533" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="ria" ID="ria"></A>Report of Independent Registered
Public Accounting Firm</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1486" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1485" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<H2 ALIGN="LEFT"><FONT COLOR="#000000">To the Board of Directors and the Shareholders of
The&nbsp;Korea&nbsp;Fund,&nbsp;Inc.:</FONT></H2>
<P ALIGN="LEFT"><FONT COLOR="#000000">In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all material
respects, the financial position of The Korea Fund, Inc. (the &quot;Fund&quot;) at
June&nbsp;30, 2005, and the results of its operations, the changes in its net assets
and the financial highlights for each of the periods indicated therein, in
conformity with accounting principles generally accepted in the United States
of America. These financial statements and financial highlights (hereafter
referred to as &quot;financial statements&quot;) are the responsibility of the Fund's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
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, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included
confirmation of securities at June 30, 2005 by correspondence with the
custodian, provide a reasonable basis for our opinion.</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_3">
<TR>
<TD ID="ID_1512" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">Boston, Massachusetts<BR>
August 19, 2005</FONT>
</P>
</TD>
<TD ID="ID_1511" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT COLOR="#000000">  PricewaterhouseCoopers LLP</FONT>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_35">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne230.gif" ALT="kor_NEW_SECTION230"></TD>
<TD ID="ID_1532" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="tax" ID="tax"></A>Tax Information       </FONT><FONT COLOR="#000000">(Unaudited)</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1484" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1483" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Fund paid distributions of $0.20 per share from net long-term capital
gains during its year ended June 30, 2005, of which 100% represents 15%
rate gains.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$13,700,000 as capital gain dividends for its year ended June 30, 2005, of
which 100% represents 15% rate gains.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Fund paid foreign taxes of $5,726,323 and earned $25,080,417 of
foreign source income during the year ended June 30, 2005. Pursuant to
Section 853 of the Internal Revenue Code, the Fund designates $0.13 per
share as foreign taxes paid and $0.56 per share as income earned from foreign
sources for the year ended June&nbsp;30, 2005.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">For federal income tax purposes, the Fund designates $37,000,000 or the
maximum amount allowable under tax law, as qualified dividend income.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Please consult a tax advisor if you have questions about federal or state income
tax laws, or on how to prepare your tax returns. If you have specific questions
about your account, please call 1-800-SCUDDER.</FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_34">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne220.gif" ALT="kor_NEW_SECTION220"></TD>
<TD ID="ID_1531" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="drip" ID="drip"></A>Dividend Reinvestment and Cash
Purchase Plan</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1482" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1481" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">The Plan</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund's Dividend Reinvestment and Cash Purchase Plan (the &quot;Plan&quot;) offers&nbsp;you
an automatic way to reinvest your dividends and capital gains distributions in shares
of the fund. The Plan also provides for cash investments in fund shares of $100 to
$3,000 semiannually through Scudder Investments Service Company or its delegate
(the &quot;Transfer Agent&quot;) and UMB Bank, N.A. (the &quot;Plan Agent&quot;). The Transfer Agent
provides record keeping services for participants in the Plan. If you would like a copy
of the Plan, please call the Transfer Agent at 1-800-294-4366.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Automatic Participation</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Each stockholder of record is automatically a participant in the Plan unless the
stockholder has instructed the Transfer Agent in writing otherwise. Such a notice
must be received by the Transfer Agent not less than 10 days prior to the record date
for a dividend or distribution in order to be effective with respect to that dividend or
distribution. A notice which is not received by that time will be effective only with
respect to subsequent dividends and distributions. </FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Stockholders who do not participate in the Plan will receive all distributions in cash
paid by check in dollars mailed directly to the stockholder by the Transfer Agent, as
dividend paying agent.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Shares Held by a Nominee</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">If your shares are held in the name of a brokerage firm, bank, or other nominee as
the stockholder of record, please consult your nominee (or any successor nominee) to
determine whether it is participating in the Plan on your behalf. Many nominees are
generally authorized to receive cash dividends unless they are specifically instructed
by a client to reinvest. If you would like your nominee to participate in the Plan on
your behalf, you should give your nominee instructions to that effect as soon as
possible.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Pricing of Dividends and Distributions</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">If the market price per share on the payment date for the dividend or distribution
(the &quot;Valuation Date&quot;) equals or exceeds net asset value per share on that date, the
fund will issue (i) shares of the fund's common stock that are issued but not
outstanding (&quot;Treasury Stock&quot;) to the extent shares of Treasury Stock are available,
and then (ii) to the extent shares of Treasury Stock are not available, newly issued
shares of the fund's common stock to participants at the greater of the following on
the Valuation Date: (a) net asset value or (b)&nbsp;95% of the market price. The Valuation
Date will be the dividend or distribution payment date or, if that date is not a
New&nbsp;York Stock Exchange trading date, the next preceding trading date. If the net
asset value exceeds the market price of fund shares at such time, the Plan Agent will
use the dividend or distribution (less each participant's pro rata share of brokerage
commissions) to buy fund shares in the open market for the participants' account.
Such purchases will be made on or shortly after the payment date for such dividend
or distribution, and in no event more than 45 days after such date except where
temporary curtailment or suspension of purchase is necessary to comply with federal
securities law. In either case, for Federal income tax purposes, the stockholder receives
a distribution equal to the market value on the Valuation Date of new shares issued.
State and local taxes may also apply. If the fund should declare an income dividend or
net capital gains distribution payable only in cash, the Plan Agent will, as agent for
the participants, buy fund shares in the open market, on the New York Stock
Exchange or elsewhere, for the participants' account on, or shortly after, the payment
date.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Voluntary Cash Purchases</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Participants in the Plan have the option of making additional cash payments to the
Transfer Agent, semiannually, in any amount from $100 to $3,000, for investment in
the fund's shares. The Plan Agent will use all such monies received from participants
to purchase fund shares in the open market on or about February 15 and August 15.
Any voluntary cash payments received more than 30 days prior to these dates will be
returned by the Transfer Agent, and interest will not be paid on any uninvested cash
payments. To avoid unnecessary cash accumulations, and also to allow ample time for
receipt and processing by the Transfer Agent, it is suggested that participants send in
voluntary cash payments to be received by the Transfer Agent approximately ten days
before February 15, or August 15, as the case may be. A participant may withdraw a
voluntary cash payment by written notice, if the notice is received by the Transfer
Agent not less than 48 hours before such payment is to be invested.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Participant Plan Accounts</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The Transfer Agent maintains all participant accounts in the Plan and furnishes
written confirmation of all transactions in the account, including information needed
by participants for personal and tax records. Shares in the account of each plan
participant will be held by the Transfer Agent in non-certificated form in the name of
the participant, and each participant will be able to vote those shares purchased
pursuant to the Plan at a stockholder meeting or by proxy. </FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">No Service Fee to Reinvest</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">There is no service fee charged to participants for reinvesting dividends or
distributions from net realized capital gains. The Plan Agent's and/or Transfer Agent's
fees for the handling of the reinvestment of dividends and capital gains distributions
will be paid by the fund. There will be no brokerage commissions with respect to
shares issued directly by the fund as a result of dividends or capital gains distributions
payable either in stock or in cash. However, participants will pay a pro rata share of
brokerage commissions incurred with respect to the Plan Agent's open market
purchases in connection with the reinvestment of any dividends or capital gains
distributions.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Costs for Cash Purchases</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">With respect to purchases of fund shares from voluntary cash payments, each
participant will be charged $0.75 for each such purchase. Each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan Agent's
open market purchases of fund shares in connection with voluntary cash payments
made by the participant.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">Brokerage charges for purchasing small amounts of stock for individual accounts
through the Plan are expected to be less than the usual brokerage charges for such
transactions, because the Plan Agent will be purchasing stock for all participants in
blocks and pro-rating the lower commission thus attainable.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Amendment or Termination</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">The fund reserves the right to terminate the Plan. Notice of the termination will be
sent to the participants of the Plan at least 30 days before the record date for a
dividend or distribution. The Plan also may be amended by the fund, but (except
when necessary or appropriate to comply with applicable law, rules or policies of a
regulatory authority) only by giving at least 30 days' written notice to participants in
the Plan.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">A participant may terminate his account under the Plan by written notice to the
Transfer Agent. If the written notice is received 10 days before the record day of any
distribution, it will be effective immediately. If received after that date, it will be
effective as soon as possible after the reinvestment of the dividend or distribution.</FONT>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">If a participant elects to sell his shares before the Plan is terminated, the Plan Agent
will deduct a $2.50 fee plus brokerage commissions from the sale transaction.</FONT>
</P>
<P ALIGN="LEFT"><B><FONT COLOR="#000000">Transfer Agent Address and Telephone Number</FONT></B>
</P>
<P ALIGN="LEFT"><FONT COLOR="#000000">You may obtain more detailed information by requesting a copy of the Plan from the
Transfer Agent. All correspondence (including notifications) should be directed to:
The Korea Fund Dividend Reinvestment and Cash Purchase Plan, c/o Scudder
Investments Service Company, P.O. Box 219066, Kansas City, MO 64121-9066,
1-800-294-4366. </FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_33">
<TR>
<TD ALIGN="LEFT" VALIGN="TOP"><IMG SRC="korne210.gif" ALT="kor_NEW_SECTION210"></TD>
<TD ID="ID_1530" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000"><A NAME="do" ID="do"></A>Directors and Officers</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1480" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1479" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><FONT COLOR="#000000">The following table presents certain information regarding the Directors and
Officers&nbsp;for The Korea Fund, Inc. as of June 30, 2005. Each individual's age is set
forth in parentheses after his or her name. Unless otherwise noted, (i)&nbsp;each individual
has engaged in the principal occupation(s) noted in the table for at least the most
recent five years, although not necessarily in the same capacity, and (ii) the address
of&nbsp;each individual is c/o Deutsche Asset Management, 345 Park Avenue, New York,
New York 10154. Each Director's term of office extends until the next stockholder's
meeting called for the purpose of electing Directors in that class and until the
election and qualification of a successor, or until such Director sooner dies,
resigns&nbsp;or&nbsp;is removed as provided in the governing documents of the fund. Messrs.
Callander, Froewiss, Luers, Nogueira and Yun also serve on the Boards of Scudder
New Asia Fund, Inc., The Brazil Fund, Inc., Scudder Global High Income Fund,
Inc. and Scudder Global Commodities Stock Fund, Inc., all of which are closed-end
funds that are managed by Deutsche Asset Management. </FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_2">
<TR>
<TD ID="ID_598" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="TOP" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Independent Directors</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1368" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Name, Age,
Position(s) Held
with the Fund
and Length of
Time Served</FONT></B>
</P>
</TD>
<TD ID="ID_1367" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Principal Occupation(s) During&nbsp;Past 5 Years and <BR>
Other Directorships Held</FONT></B>
</P>
</TD>
<TD ID="ID_1366" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Number
of Funds
in Fund
Complex
Overseen</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_725" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Robert J.
Callander (74)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Chairman</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2004-present</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">1996-present</FONT>
</P>
</TD>
<TD ID="ID_720" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Retired Vice Chairman, Chemical Banking Corporation;
Directorships: Aramark Corporation (food service); Member,
Council on Foreign Relations</FONT>
</P>
</TD>
<TD ID="ID_719" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">5</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_718" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Kenneth C.
Froewiss (59)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2000-present</FONT>
</P>
</TD>
<TD ID="ID_715" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Clinical Professor of Finance, NYU Stern School of Business;
Member, Finance Committee, Association for Asian Studies
(2002-present);  prior thereto, Managing Director, J.P. Morgan
(investment banking firm) (until 1996)</FONT>
</P>
</TD>
<TD ID="ID_714" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">5</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_713" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">William H. Luers
(76)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2001-present</FONT>
</P>
</TD>
<TD ID="ID_710" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">President and Chief Executive Officer, United Nations
Association of the United States of America; Directorships:
Wickes Lumber Company (building materials), America Online
Latin America (media communications), Rockefeller Brothers
Fund (foundation), Appeal of Conscience Foundation; Member,
Advisory Board, The Trust for Mutual Understanding</FONT>
</P>
</TD>
<TD ID="ID_709" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">5</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_708" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Ronaldo A. da
Frota Nogueira
(67) </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2000-present</FONT>
</P>
</TD>
<TD ID="ID_705" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director and Chief Executive Officer, IMF Editora Ltd. (financial
publisher); Chairman of the Certification Committee and
Director, APIMEC Nacional (Brazilian Association of Investment
Professionals and Analysts); Member, Board of the Association
of Certified International Investment Analysts (ACIIA)</FONT>
</P>
</TD>
<TD ID="ID_625" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">5</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_704" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Julian Reid (60)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2004-present</FONT>
</P>
</TD>
<TD ID="ID_701" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Chief Executive Officer of 3a Asset Management Limited (since
1998); President of the Saffron Fund, Inc. (1994-1998, since
2004); and Chairman of Morgan's Walk Properties Ltd. (since
2002). Directorships: Chairman of the Board of Directors of the
Saffron Fund, Inc. (since 1998); and Director of JF China Region
Fund, Inc. (since 1997).</FONT>
</P>
</TD>
<TD ID="ID_624" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">1</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_700" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Chris Russell (55)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2004-present</FONT>
</P>
</TD>
<TD ID="ID_697" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Consultant of Gavekal Research (since 2001); and Director of
each of: Candover plc (since 2004); LIM Japan Fund (since
2002); Enhanced Index Funds (since 2002); Investec High
Income Trust (since 2001); and Gartmore Investment
Management plc (1997-2001).</FONT>
</P>
</TD>
<TD ID="ID_623" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">1</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_696" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Kesop Yun (60) </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">1984-1988,
1994-present</FONT>
</P>
</TD>
<TD ID="ID_693" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Professor, College of Business Administration, Seoul National
University, Seoul, Korea; prior thereto, Director, The Korea
Liberalisation Fund, Inc. (U.K.) (1996-1999); Dean, College of
Business Administration, Seoul National University (1999-2001);
Visiting Professor, London Business School (1997-1998)</FONT>
</P>
</TD>
<TD ID="ID_692" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">5</FONT>
</P>
</TD>
</TR>


</TABLE>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_1">
<TR>
<TD ID="ID_597" BGCOLOR="#000000" ALIGN="LEFT" VALIGN="TOP" COLSPAN="3">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#ffffff">Interested Director and Officers</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1365" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Name, Age,
Position(s) Held
with the Fund
and Length of
Time Served</FONT></B>
</P>
</TD>
<TD ID="ID_1364" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Principal Occupation(s) During&nbsp;Past 5 Years and <BR>
Other Directorships Held</FONT></B>
</P>
</TD>
<TD ID="ID_1363" ALIGN="LEFT" VALIGN="BOTTOM">
<P ALIGN="LEFT"><B><FONT SIZE="-2" COLOR="#000000">Number
of Funds
in Fund
Complex
Overseen</FONT></B>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_691" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Vincent J.
Esposito<SUP>1,2</SUP> (49)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Vice Chairman
and Director </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2004-present</FONT>
</P>
</TD>
<TD ID="ID_688" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Managing Director, DeAM (since 2003); Vice President of
Central European Equity Fund, Inc. (since 2003); Vice President
of The Germany Fund, Inc. (since 2003); Vice President of The
New Germany Fund, Inc. (since 2003) (registered investment
companies); formerly, Managing Director, Putnam Investments
(1991-2002)</FONT>
</P>
</TD>
<TD ID="ID_687" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">5</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_686" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Julian F. Sluyters<SUP>2</SUP>
(45)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">President and
Chief Executive
Officer</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2004-present </FONT>
</P>
</TD>
<TD ID="ID_683" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Managing Director, DeAM (since May 2004); President and
Chief Executive Officer of The Brazil Fund, Inc., Scudder Global
High Income Fund, Inc. and Scudder New Asia Fund, Inc. (since
May 2004); Chief Executive Officer of the Scudder Funds (203
funds); President and Chief Executive Officer, UBS Fund Services
(2001-2003); Chief Administrative Officer (1998-2001) and
Senior Vice President and Director of Mutual Fund Operations
(1991-1998), UBS Global Asset Management</FONT>
</P>
</TD>
<TD ID="ID_622" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_682" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Terrence S. Gray<SUP>2</SUP>
(35)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Vice President</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2005-present</FONT>
</P>
</TD>
<TD ID="ID_679" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director of Deutsche Asset Management</FONT>
</P>
</TD>
<TD ID="ID_621" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_678" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Paul H.
Schubert<SUP>2</SUP> (42)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Chief Financial
Officer since
2004</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Treasurer since
July 2005</FONT>
</P>
</TD>
<TD ID="ID_675" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Managing Director, Deutsche Asset Management (since July
2004); formerly, Executive Director, Head of Mutual Fund
Services and Treasurer for UBS Family of Funds at UBS Global
Asset Management (1994-2004).</FONT>
</P>
</TD>
<TD ID="ID_674" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_673" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Carole
Coleman<SUP>2,5</SUP> (35)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Vice President
and Secretary</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2005-present</FONT>
</P>
</TD>
<TD ID="ID_670" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director of Deutsche Asset Management (2005-present);
Associate General Counsel of Fred Alger &amp; Company, Inc. (April
2002-June 2005). Associate Attorney, Charpie &amp; Associates
(October 1995-March 2002).</FONT>
</P>
</TD>
<TD ID="ID_620" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_669" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Scott M.
McHugh<SUP>3,5</SUP> (33)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Assistant
Treasurer since
2005</FONT>
</P>
</TD>
<TD ID="ID_667" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director of Deutsche Asset Management.</FONT>
</P>
</TD>
<TD ID="ID_619" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_666" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Kathleen
Sullivan
D'Eramo<SUP>3</SUP> (46)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Assistant
Treasurer</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">2003-present</FONT>
</P>
</TD>
<TD ID="ID_663" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director of Deutsche Asset Management</FONT>
</P>
</TD>
<TD ID="ID_618" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_662" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">John Millette<SUP>3</SUP>
(41)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Assistant
Secretary </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">1999-present</FONT>
</P>
</TD>
<TD ID="ID_659" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Director of Deutsche Asset Management</FONT>
</P>
</TD>
<TD ID="ID_617" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_658" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Caroline Pearson<SUP>3</SUP>
(42)</FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Assistant
Secretary </FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">1998-present</FONT>
</P>
</TD>
<TD ID="ID_655" ALIGN="LEFT" VALIGN="TOP">
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000">Managing Director of Deutsche Asset Management </FONT>
</P>
</TD>
<TD ID="ID_616" ALIGN="CENTER" VALIGN="TOP">
<P ALIGN="CENTER"><FONT SIZE="-2" COLOR="#000000">n/a</FONT>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><SUP>1</SUP><I> As a result of their respective positions held with the Manager, these individuals are considered
&quot;interested persons&quot; of the Manager within the meaning of the 1940 Act, as amended. Interested
persons receive no compensation from the fund.</I></FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><SUP>2</SUP><I> Address: 345 Park Avenue, New York, New York</I></FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><SUP>3</SUP><I> Address: Two International Place, Boston, Massachusetts</I></FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><SUP>4</SUP><I> Address: One South Street, Baltimore, Maryland</I></FONT>
</P>
<P ALIGN="LEFT"><FONT SIZE="-2" COLOR="#000000"><SUP>5</SUP><I> Elected July 6, 2005</I></FONT>
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_32">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="korne200.gif" ALT="kor_NEW_SECTION200"></TD>
<TD ID="ID_1529" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">Notes</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1478" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1477" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><IMG SRC="kornoge4.gif" ALT="kor_notes_page4">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_31">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="korne1f0.gif" ALT="kor_NEW_SECTION1F0"></TD>
<TD ID="ID_1528" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">Notes</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1476" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1475" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><IMG SRC="kornoge3.gif" ALT="kor_notes_page3">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_30">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="korne1e0.gif" ALT="kor_NEW_SECTION1E0"></TD>
<TD ID="ID_1527" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">Notes</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1474" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1473" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><IMG SRC="kornoge2.gif" ALT="kor_notes_page2">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_29">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="korne1d0.gif" ALT="kor_NEW_SECTION1D0"></TD>
<TD ID="ID_1526" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">Notes</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1472" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1471" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><IMG SRC="kornoge1.gif" ALT="kor_notes_page1">
</P>
<TABLE BORDER="1" CELLPADDING=0 CELLSPACING=0 ID="ID_28">
<TR>
<TD ALIGN="LEFT" VALIGN="BOTTOM"><IMG SRC="korne1c0.gif" ALT="kor_NEW_SECTION1C0"></TD>
<TD ID="ID_1525" ALIGN="LEFT" VALIGN="BOTTOM">
<H1 ALIGN="LEFT"><FONT COLOR="#000000">Notes</FONT></H1>
</TD>
</TR>

<TR>
<TD ID="ID_1470" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>

<TR>
<TD ID="ID_1469" ALIGN="RIGHT" VALIGN="BOTTOM" COLSPAN="2">
<P ALIGN="RIGHT"><I><FONT SIZE="-2" COLOR="#000000">&nbsp;</FONT></I>
</P>
</TD>
</TR>


</TABLE>
<P ALIGN="LEFT"><IMG SRC="kornoge0.gif" ALT="kor_notes_page0">
</P>
<P ALIGN="LEFT">
</P>


<PRE>

ITEM 2.         CODE OF ETHICS.

As of the end of the period, June 30, 2005, The Korea Fund, Inc. has adopted
a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its
Principal Executive Officer and Principal Financial Officer.

There have been no amendments to, or waivers from, a provision of the code of
ethics during the period covered by this report that would require disclosure
under Item 2.

A copy of the code of ethics is filed as an exhibit to this Form N-CSR.


ITEM 3.         AUDIT COMMITTEE FINANCIAL EXPERT.

The Fund's Board of Directors has determined that the Fund has at least one
"audit committee financial expert" serving on its audit committee: Mr. Robert
J.Callander, Mr. Kenneth C. Froewiss, and Mr. Kesop Yun. Each of these audit
committee members is "independent," meaning that he is not an "interested
person" of the Fund (as that term is defined in Section 2(a)(19) of the
Investment Company Act of 1940) and he does not accept any consulting, advisory,
or other compensatory fee from the Fund (except in the capacity as a Board or
committee member).

An "audit committee financial expert" is not an "expert" for any purpose,
including for purposes of Section 11 of the Securities Act of 1933, as a result
of being designated as an "audit committee financial expert." Further, the
designation of a person as an "audit committee financial expert" does not mean
that the person has any greater duties, obligations, or liability than those
imposed on the person without the "audit committee financial expert"
designation. Similarly, the designation of a person as an "audit committee
financial expert" does not affect the duties, obligations, or liability of any
other member of the audit committee or board of directors.

ITEM 4.         PRINCIPAL ACCOUNTANT FEES AND SERVICES.

                                 THE KOREA FUND
                      FORM N-CSR DISCLOSURE RE: AUDIT FEES

The following  table shows the amount of fees that  PricewaterhouseCoopers,  LLP
("PWC"), the Fund's independent registered public accounting firm, billed to the
Fund during the Fund's last two fiscal years.  For engagements  with PWC entered
into on or after May 6, 2003, the Audit Committee  approved in advance all audit
services and non-audit services that PWC provided to the Fund.

The Audit Committee has delegated certain  pre-approval  responsibilities to its
Chairman (or, in his absence, any other member of the Audit Committee).

        Services that the Fund's Independent Registered Public Accounting
                            Firm Billed to the Fund

- --------------------------------------------------------------------------------
Fiscal Year      Audit       Audit-Related       Tax Fees        All  Other
   Ended      Fees Billed     Fees Billed        Billed to      Fees Billed
 June 30,       to Fund         to Fund            Fund           to Fund
- --------------------------------------------------------------------------------
2005            $106,000         $225            $20,000             $0
- --------------------------------------------------------------------------------
2004            $102,500         $185            $11,300             $0
- --------------------------------------------------------------------------------

The above "Audit- Related Fees" were billed for agreed upon procedures performed
and the above "Tax Fees" were billed for professional  services rendered for tax
compliance and tax return preparation.


  Services that the Fund's Independent Registered Public Accounting Firm Billed
              to the Adviser and Affiliated Fund Service Providers

The  following  table  shows  the  amount  of  fees  billed  by PWC to  Deutsche
Investment Management Americas,  Inc. ("DeIM" or the "Adviser"),  and any entity
controlling,   controlled  by  or  under  common  control  with  DeIM  ("Control
Affiliate") that provides ongoing services to the Fund ("Affiliated Fund Service
Provider"),  for  engagements  directly  related  to the Fund's  operations  and
financial reporting, during the Fund's last two fiscal years.

- --------------------------------------------------------------------------------
              Audit-Related            Tax Fees             All Other
Fiscal         Fees Billed to          Billed to           Fees Billed
 Year          Adviser and            Adviser and         to Adviser and
 Ended        Affiliated Fund        Affiliated Fund      Affiliated Fund
June 30,     Service Providers      Service Providers    Service Providers
- --------------------------------------------------------------------------------
2005                $264,200                 $0                    $0
- --------------------------------------------------------------------------------
2004                $807,051                 $0                    $0
- --------------------------------------------------------------------------------

The  "Audit-Related  Fees"  were  billed for  services  in  connection  with the
assessment of internal controls,  agreed-upon  procedures and additional related
procedures.



<PAGE>



                               Non-Audit Services

The  following  table shows the amount of fees that PWC billed during the Fund's
last two fiscal years for non-audit services. For engagements entered into on or
after May 6, 2003, the Audit Committee  pre-approved all non-audit services that
PWC  provided to the Adviser  and any  Affiliated  Fund  Service  Provider  that
related  directly to the Fund's  operations and financial  reporting.  The Audit
Committee  requested  and  received  information  from PWC about  any  non-audit
services that PWC rendered during the Fund's last fiscal year to the Adviser and
any Affiliated Fund Service Provider.  The Committee considered this information
in evaluating PWC's independence.

- --------------------------------------------------------------------------------
                                Total
                             Non-Audit
                            Fees billed
                             to Adviser
                                and
                             Affiliated
                            Fund Service             Total
                             Providers             Non-Audit
                            (engagements          Fees billed
                              related             to Adviser
              Total        directly to the      and Affiliated
            Non-Audit      operations and        Fund Service
Fiscal        Fees            financial           Providers
 Year        Billed          reporting            (all other         Total of
 Ended       to Fund        of the Fund)         engagements)        (A), (B)
June 30,       (A)               (B)                  (C)             and (C)
- --------------------------------------------------------------------------------
2005        $20,000             $0                 $89,635           $109,635
- --------------------------------------------------------------------------------
2004        $11,300             $0               $1,722,293        $1,733,593
- --------------------------------------------------------------------------------

All other  engagement  fees were  billed for  services in  connection  with risk
management,  tax services and process  improvement/integration  initiatives  for
DeIM and other related  entities that provide  support for the operations of the
fund.

ITEM 5.         AUDIT COMMITTEE OF LISTED REGISTRANTS

The registrant has a separately-designated standing audit committee established
in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934,
as amended. The registrant's audit committee consists of Robert J. Callander,
Ronaldo A. da Frota Nogueira, Kenneth C. Froewiss(Chairman), William H. Luers,
Julian Reid, Christopher Russell, Kesop Yun.

ITEM 6.         SCHEDULE OF INVESTMENTS

                Not Applicable

ITEM 7.         DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
                CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Proxy Voting Guidelines

The Fund has delegated proxy voting responsibilities to its investment advisor,
subject to the Board's general oversight. The Fund has delegated proxy voting to
the advisor with the direction that proxies should be voted consistent with the
Fund's best economic interests. The advisor has adopted its own Proxy Voting
Policies and Procedures ("Policies"), and Proxy Voting Guidelines ("Guidelines")
for this purpose. The Policies address, among other things, conflicts of
interest that may arise between the interests of the Fund, and the interests of
the advisor and its affiliates, including the Fund's principal underwriter. The
Guidelines set forth the advisor's general position on various proposals, such
as:

o        Shareholder Rights -- The advisor generally votes against proposals
         that restrict shareholder rights.

o        Corporate Governance -- The advisor generally votes for confidential
         and cumulative voting and against supermajority voting requirements for
         charter and bylaw amendments.

o        Anti-Takeover Matters -- The advisor generally votes for proposals that
         require shareholder ratification of poison pills or that request boards
         to redeem poison pills, and votes "against" the adoption of poison
         pills if they are submitted for shareholder ratification. The advisor
         generally votes for fair price proposals.

o        Routine Matters -- The advisor generally votes for the ratification of
         auditors, procedural matters related to the annual meeting, and changes
         in company name, and against bundled proposals and adjournment.

The general provisions described above do not apply to investment companies. The
advisor generally votes proxies solicited by investment companies in accordance
with the recommendations of an independent third-party, except for proxies
solicited by or with respect to investment companies for which the advisor or an
affiliate serves as investment advisor or principal underwriter ("affiliated
investment companies"). The advisor votes affiliated investment company proxies
in the same proportion as the vote of the investment company's other
shareholders (sometimes called "mirror" or "echo" voting). Master fund proxies
solicited from feeder funds are voted in accordance with applicable requirements
of the Investment Company Act of 1940.

Although the Guidelines set forth the advisor's general voting positions on
various proposals, the advisor may, consistent with the Fund's best interests,
determine under some circumstances to vote contrary to those positions.

The Guidelines on a particular issue may or may not reflect the view of
individual members of the board, or of a majority of the board. In addition, the
Guidelines may reflect a voting position that differs from the actual practices
of the public companies within the Deutsche Bank organization or of the
investment companies for which the advisor or an affiliate serves as investment
advisor or sponsor.

The advisor may consider the views of a portfolio company's management in
deciding how to vote a proxy or in establishing general voting positions for the
Guidelines, but management's views are not determinative.

As mentioned above, the Policies describe the way in which the advisor resolves
conflicts of interest. To resolve conflicts, the advisor, under normal
circumstances, votes proxies in accordance with its Guidelines. If the advisor
departs from the Guidelines with respect to a particular proxy or if the
Guidelines do not specifically address a certain proxy proposal, a proxy voting
committee established by the advisor will vote the proxy. Before voting any such
proxy, however, the advisor's conflicts review committee will conduct an
investigation to determine whether any potential conflicts of interest exist in
connection with the particular proxy proposal. If the conflicts review committee
determines that the advisor has a material conflict of interest, or certain
individuals on the proxy voting committee should be recused from participating
in a particular proxy vote, it will inform the proxy voting committee. If
notified that the advisor has a material conflict, or fewer than three voting
members are eligible to participate in the proxy vote, typically the advisor
will engage an independent third party to vote the proxy or follow the proxy
voting recommendations of an independent third party. Under certain
circumstances, the advisor may not be able to vote proxies or the advisor may
find that the expected economic costs from voting outweigh the benefits
associated with voting. For example, the advisor may not vote proxies on certain
foreign securities due to local restrictions or customs. The advisor generally
does not vote proxies on securities subject to share blocking restrictions.

ITEM 8.         PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

                Not applicable.

ITEM 9.         PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT
                INVESTMENT COMPANY AND AFFILIATED PURCHASERS

Korea Fund

Item 9 of Form N-CSR - Repurchase Disclosure

- --------------------------------------------------------------------------------

                                                        (c)           (d)
                                                        Total         Maximum
                                                        Number of     Number of
                                                        Shares        Shares
                               (a)          (b)         Purchased     that May
                               Total        Average     as Part of    Yet Be
                               Number       Price       Publicly      Purchased
                               of           Paid        Announced     Under the
                               Shares       per         Plans or      Plans or
Period                         Purchased    Share       Programs      Programs
- --------------------------------------------------------------------------------

July 1 through July 31, 2004      0          $0.0          n/a           n/a
August 1 through August 31        0          $0.0          n/a           n/a
September 1 through September 30  0          $0.0          n/a           n/a
October 1 through October 31      0          $0.0          n/a           n/a
November 1 through November 30    0          $0.0          n/a           n/a
December 1 through December 31    0          $0.0          n/a           n/a
January 1 through January 31      0          $0.0          n/a           n/a
February 1 through February 28    0          $0.0          n/a           n/a
March 1 through March 31          0          $0.0          n/a           n/a
April 1 through April 30          0          $0.0          n/a           n/a
May 1 through May 31              0          $0.0          n/a           n/a
June 1 through June 30            0          $0.0          n/a           n/a

- --------------------------------------------------------------------------------
Total                             0          $0.0          n/a           n/a
- --------------------------------------------------------------------------------

ITEM 10.        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

The   Committee  on   Independent   Trustees/Directors   selects  and  nominates
Independent Trustees/Directors.  Fund shareholders may also submit nominees that
will be  considered by the committee  when a Board vacancy  occurs.  Submissions
should be mailed to the  attention  of the  Secretary of the 345 Park Avenue New
York, NY 10154

ITEM 11.        CONTROLS AND PROCEDURES.

(a) The Chief Executive and Financial Officers concluded that the Registrant's
Disclosure Controls and Procedures are effective based on the evaluation of the
Disclosure Controls and Procedures as of a date within 90 days of the filing
date of this report.

(b) There have been no changes in the registrant's internal control over
financial reporting that occurred during the registrant's last half-year (the
registrant's second fiscal half-year in the case of the annual report) that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal controls over financial reporting.

ITEM 12.        EXHIBITS.

(a)(1)   Code of Ethics  pursuant to Item 2 of Form N-CSR is filed and  attached
         hereto as EX-99.CODE ETH.

(a)(2)   Certification  pursuant to Rule 30a-2(a) under the  Investment  Company
         Act of 1940 (17 CFR  270.30a-2(a))  is filed  and  attached  hereto  as
         Exhibit 99.CERT.

(b)      Certification  pursuant to Rule 30a-2(b) under the  Investment  Company
         Act of 1940 (17 CFR  270.30a-2(b))  is furnished and attached hereto as
         Exhibit 99.906CERT.


<PAGE>

Form N-CSR Item F

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

Registrant:                         The Korea Fund, Inc.


By:                                 /s/ Julian Sluyters
                                    ---------------------------
                                    Julian Sluyters
                                    Chief Executive Officer

Date:                               August 31, 2005


Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

Registrant:                         The Korea Fund, Inc.


By:                                 /s/ Julian Sluyters
                                    ---------------------------
                                    Julian Sluyters
                                    Chief Executive Officer

Date:                               August 31, 2005



By:                                 /s/ Paul Schubert
                                    ---------------------------
                                    Paul Schubert
                                    Chief Financial Officer

Date:                               August 31, 2005


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`
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<SEQUENCE>11
<FILENAME>korne240.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne240.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
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<FILENAME>korne250.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne250.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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A,#VV="GQX\J4)A<V+-F1)T^$/W6JO"F2:,RC2`\&!``[
`
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<TYPE>GRAPHIC
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<FILENAME>korne260.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne260.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
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<FILENAME>korne270.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne270.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
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<FILENAME>korne280.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne280.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
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<FILENAME>korne290.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne290.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
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<FILENAME>korne2a0.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne2a0.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<DOCUMENT>
<TYPE>GRAPHIC
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<FILENAME>korne2b0.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne2b0.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>19
<FILENAME>korne2c0.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne2c0.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>20
<FILENAME>korne2d0.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne2d0.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>21
<FILENAME>korne2e0.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne2e0.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
<SEQUENCE>22
<FILENAME>korne300.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 korne300.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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`
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<TYPE>GRAPHIC
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<FILENAME>kornee90.gif
<DESCRIPTION>GRAPHIC
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begin 644 kornee90.gif
M1TE&.#EA%0`7`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0#,`V>;__P``
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<DOCUMENT>
<TYPE>GRAPHIC
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<FILENAME>kornoge0.gif
<DESCRIPTION>GRAPHIC
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begin 644 kornoge0.gif
M1TE&.#EA5@$X`.<!`````/____?W]^_O[]_?W[^_OW]_?T!`0```_P``````
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<DOCUMENT>
<TYPE>GRAPHIC
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<DOCUMENT>
<TYPE>EX-99.CODE ETH
<SEQUENCE>30
<FILENAME>code_prinofficers0805.txt
<DESCRIPTION>CODE OD ETHICS
<TEXT>










                               Scudder/DeAM Funds

       Principal Executive and Principal Financial Officer Code of Ethics

               For the Registered Management Investment Companies

                              Listed on Appendix A

































                                                                  Effective Date
                                                                  [August, 2005]

<PAGE>




<TABLE>
<CAPTION>
Table of Contents
                                                                                                               Page Number

<S>                                                                                                                     <C>
   I.       Overview.....................................................................................................3

   II.      Purposes of the Officer Code.................................................................................3

   III.     Responsibilities of Covered Officers.........................................................................4

      A.    Honest and Ethical Conduct...................................................................................4
      B.    Conflicts of Interest........................................................................................4
      C.    Use of Personal Fund Shareholder Information.................................................................6
      D.    Public Communications........................................................................................6
      E.    Compliance with Applicable Laws, Rules and Regulations.......................................................6

   IV.      Violation Reporting..........................................................................................7

      A.    Overview.....................................................................................................7
      B.    How to Report................................................................................................7
      C.    Process for Violation Reporting to the Fund Board............................................................7
      D.    Sanctions for Code Violations................................................................................7

   V.       Waivers from the Officer Code................................................................................7

   VI.      Amendments to the Code.......................................................................................8

   VII.     Acknowledgement and Certification of Adherence to the Officer Code...........................................8

   IX.      Recordkeeping................................................................................................8

   X.       Confidentiality..............................................................................................9

   Appendices...........................................................................................................10

      Appendix A:  List of Officers Covered under the Code, by Board....................................................10
      Appendix B:  Officer Code Acknowledgement and Certification Form..................................................11
      Appendix C:  Definitions..........................................................................................13
</TABLE>

                                       2
<PAGE>

I.           Overview

         This Principal  Executive Officer and Principal  Financial Officer Code
         of Ethics  ("Officer  Code") sets forth the  policies,  practices,  and
         values  expected  to be  exhibited  in the  conduct  of  the  Principal
         Executive  Officers and Principal  Financial Officers of the investment
         companies ("Funds") they serve ("Covered Officers").  A list of Covered
         Officers and Funds is included on Appendix A.

         The Boards of the Funds  listed on Appendix A have elected to implement
         the Officer Code,  pursuant to Section 406 of the Sarbanes-Oxley Act of
         2002 and the SEC's rules thereunder,  to promote and demonstrate honest
         and ethical conduct in their Covered Officers.

         Deutsche Asset  Management,  Inc. or its affiliates  ("DeAM") serves as
         the  investment  adviser to each Fund.  All Covered  Officers  are also
         employees of DeAM or an affiliate. Thus, in addition to adhering to the
         Officer  Code,  these  individuals  must comply with DeAM  policies and
         procedures,  such as the DeAM Code of Ethics governing personal trading
         activities,  as adopted  pursuant  to Rule 17j-1  under the  Investment
         Company Act of 1940.(1) In addition,  such individuals also must comply
         with other applicable Fund policies and procedures.

         The DeAM Compliance Officer, who shall not be a Covered Officer and who
         shall serve as such  subject to the  approval  of the Fund's  Board (or
         committee  thereof),  is primarily  responsible  for  implementing  and
         enforcing  this Code.  The  Compliance  Officer  has the  authority  to
         interpret  this  Officer  Code  and  its  applicability  to  particular
         circumstances.  Any questions about the Officer Code should be directed
         to the DeAM Compliance Officer.

         The DeAM Compliance  Officer and his or her contact  information can be
         found in Appendix A.

II.          Purposes of the Officer Code

         The purposes of the Officer Code are to deter wrongdoing and to:

         o        promote  honest and ethical  conduct among  Covered  Officers,
                  including the ethical handling of actual or apparent conflicts
                  of interest between personal and professional relationships;

         o        promote  full,  fair,  accurate,   timely  and  understandable
                  disclosures  in reports and documents that the Funds file with
                  or submit to the SEC (and in other public  communications from
                  the  Funds)  and  that  are  within  the   Covered   Officer's
                  responsibilities;

         o        promote   compliance   with   applicable   laws,   rules   and
                  regulations;

         o        encourage the prompt  internal  reporting of violations of the
                  Officer Code to the DeAM Compliance Officer; and

         o        establish accountability for adherence to the Officer Code.

         Any  questions  about the  Officer  Code  should be  referred to DeAM's
         Compliance Officer.


- ------------------------
(1) The obligations imposed by the Officer Code are separate from, and in
addition to, any obligations imposed under codes of ethics adopted pursuant to
Rule 17j-1 under the Investment Company Act of 1940, and any other code of
conduct applicable to Covered Officers in whatever capacity they serve. The
Officer Code does not incorporate any of those other codes and, accordingly,
violations of those codes will not necessarily be considered violations of the
Officer Code and waivers granted under those codes would not necessarily require
a waiver to be granted under this Code. Sanctions imposed under those codes may
be considered in determining appropriate sanctions for any violation of this
Code.

                                       3
<PAGE>

III.         Responsibilities of Covered Officers

         A. Honest and Ethical Conduct

         It is the duty of every Covered  Officer to encourage  and  demonstrate
         honest and ethical conduct,  as well as adhere to and require adherence
         to the Officer Code and any other  applicable  policies and  procedures
         designed to promote this behavior.  Covered  Officers must at all times
         conduct  themselves with integrity and  distinction,  putting first the
         interests of the Fund(s) they serve.  Covered  Officers  must be honest
         and candid  while  maintaining  confidentiality  of  information  where
         required by law, DeAM policy or Fund policy.

         Covered   Officers  also  must,  at  all  times,  act  in  good  faith,
         responsibly  and with  due  care,  competence  and  diligence,  without
         misrepresenting  or being  misleading  about material facts or allowing
         their  independent  judgment to be subordinated.  Covered Officers also
         should maintain skills appropriate and necessary for the performance of
         their duties for the Fund(s).  Covered  Officers also must  responsibly
         use and control all Fund assets and resources entrusted to them.

         Covered  Officers may not  retaliate  against  others for, or otherwise
         discourage  the  reporting  of,  actual or apparent  violations  of the
         Officer Code or applicable laws or regulations. Covered Officers should
         create an  environment  that  encourages  the exchange of  information,
         including concerns of the type that this Code is designed to address.

         B. Conflicts of Interest

         A  "conflict  of  interest"  occurs when a Covered  Officer's  personal
         interests  interfere with the interests of the Fund for which he or she
         serves as an officer.  Covered  Officers may not  improperly  use their
         position with a Fund for personal or private gain to themselves,  their
         family,  or any other person.  Similarly,  Covered Officers may not use
         their  personal  influence  or  personal   relationships  to  influence
         decisions  or other Fund  business or  operational  matters  where they
         would  benefit  personally  at the  Fund's  expense  or to  the  Fund's
         detriment.  Covered Officers may not cause the Fund to take action,  or
         refrain from taking action,  for their  personal  benefit at the Fund's
         expense or to the Fund's  detriment.  Some  examples  of  conflicts  of
         interest  follow  (this  is not an  all-inclusive  list):  being in the
         position of  supervising,  reviewing or having any influence on the job
         evaluation,  pay or benefit of any  immediate  family  member who is an
         employee of a Fund service provider or is otherwise associated with the
         Fund; or having an ownership  interest in, or having any  consulting or
         employment relationship with, any Fund service provider other than DeAM
         or its affiliates.

         Certain  conflicts  of  interest  covered by this Code arise out of the
         relationships  between  Covered  Officers and the Fund that already are
         subject to conflict of interest  provisions in the  Investment  Company
         Act and the Investment Advisers Act. For example,  Covered Officers may
         not individually  engage in certain  transactions (such as the purchase
         or sale of securities or other property) with the Fund because of their
         status as  "affiliated  persons"  of the Fund.  Covered  Officers  must
         comply with applicable laws and regulations.  Therefore, any violations
         of  existing  statutory  and  regulatory   prohibitions  on  individual
         behavior could be considered a violation of this Code.

         As  to  conflicts  arising  from,  or  as  a  result  of  the  advisory
         relationship (or any other relationships) between the Fund and DeAM, of
         which the  Covered  Officers  are also  officers  or  employees,  it is
         recognized by the Board that, subject to DeAM's fiduciary duties to the
         Fund,  the Covered  Officers  will in the normal course of their duties
         (whether formally for the Fund or for DeAM, or for both) be involved in
         establishing  policies  and  implementing  decisions  which  will  have
         different  effects on


                                       4
<PAGE>

         DeAM and the Fund. The Board  recognizes that the  participation of the
         Covered  Officers  in  such  activities  is  inherent  in the  contract
         relationship  between  the Fund and DeAM,  and is  consistent  with the
         expectation of the Board of the performance by the Covered  Officers of
         their duties as officers of the Fund.

         Covered  Officers  should  avoid  actual  conflicts  of  interest,  and
         appearances  of conflicts of  interest,  between the Covered  Officer's
         duties  to the  Fund and his or her  personal  interests  beyond  those
         contemplated  or anticipated  by applicable  regulatory  schemes.  If a
         Covered  Officer  suspects or knows of a conflict or an  appearance  of
         one, the Covered Officer must immediately report the matter to the DeAM
         Compliance  Officer.  If a Covered Officer, in lieu of reporting such a
         matter to the DeAM Compliance  Officer,  may report the matter directly
         to the Fund's Board (or committee  thereof),  as appropriate  (e.g., if
         the  conflict  involves  the DeAM  Compliance  Officer  or the  Covered
         Officer reasonably  believes it would be futile to report the matter to
         the DeAM Compliance Officer).

         When  actual,  apparent or  suspected  conflicts  of interest  arise in
         connection with a Covered  Officer,  DeAM personnel aware of the matter
         should promptly contact the DeAM Compliance  Officer.  There will be no
         reprisal or retaliation against the person reporting the matter.

         Upon receipt of a report of a possible  conflict,  the DeAM  Compliance
         Officer will take steps to determine  whether a conflict exists.  In so
         doing,  the DeAM  Compliance  Officer  may take any  actions  he or she
         determines to be appropriate in his or her sole  discretion and may use
         all  reasonable  resources,   including  retaining  or  engaging  legal
         counsel,  accounting firms or other consultants,  subject to applicable
         law.(2)  The costs  associated  with such  actions  may be borne by the
         Fund,  if  appropriate,  after  consultation  with the Fund's Board (or
         committee  thereof).  Otherwise,  such  costs  will be borne by DeAM or
         other appropriate Fund service provider.

         After full review of a report of a possible  conflict of interest,  the
         DeAM  Compliance  Officer may determine  that no conflict or reasonable
         appearance  of a conflict  exists.  If,  however,  the DeAM  Compliance
         Officer  determines  that an actual  conflict  exists,  the  Compliance
         Officer will resolve the conflict  solely in the interests of the Fund,
         and will report the conflict and its resolution to the Fund's Board (or
         committee thereof).  If the DeAM Compliance Officer determines that the
         appearance of a conflict exists,  the DeAM Compliance Officer will take
         appropriate  steps to remedy such  appearance.  In lieu of  determining
         whether  a  conflict  exists  and/or  resolving  a  conflict,  the DeAM
         Compliance Officer instead may refer the matter to the Fund's Board (or
         committee  thereof),  as  appropriate.  However,  the  DeAM  Compliance
         Officer  must  refer the  matter  to the  Fund's  Board  (or  committee
         thereof) if the DeAM  Compliance  Officer is  directly  involved in the
         conflict or under similar appropriate circumstances.

         After  responding to a report of a possible  conflict of interest,  the
         DeAM  Compliance  Officer  will  discuss  the  matter  with the  person
         reporting it (and with the Covered  Officer at issue, if different) for
         purposes  of  educating   those  involved  on  conflicts  of  interests
         (including how to detect and avoid them, if appropriate).

         Appropriate   resolution   of  conflicts   may  restrict  the  personal
         activities of the Covered  Officer and/or his family,  friends or other
         persons.

         Solely because a conflict is disclosed to the DeAM  Compliance  Officer
         (and/or the Board or  Committee  thereof)  and/or  resolved by the DeAM
         Compliance  Officer does not mean that the  conflict or its  resolution
         constitutes a waiver from the Code's requirements.


- ------------------------
(2) For example, retaining a Fund's independent accounting firm may require
pre-approval by the Fund's audit committee.

                                       5
<PAGE>

         Any  questions  about  conflicts  of  interests,  including  whether  a
         particular  situation  might be a  conflict  or an  appearance  of one,
         should be directed to the DeAM Compliance Officer.

         C. Use of Personal Fund Shareholder Information

         A Covered Officer may not use or disclose  personal  information  about
         Fund  shareholders,  except in the performance of his or her duties for
         the Fund. Each Covered Officer also must abide by the Funds' and DeAM's
         privacy policies under SEC Regulation S-P.

         D. Public Communications

         In connection with his or her  responsibilities for or involvement with
         a  Fund's  public   communications  and  disclosure   documents  (e.g.,
         shareholder reports,  registration  statements,  press releases),  each
         Covered  Officer must  provide  information  to Fund service  providers
         (within the DeAM  organization  or  otherwise)  and to the Fund's Board
         (and  any  committees  thereof),   independent   auditors,   government
         regulators and  self-regulatory  organizations that is fair,  accurate,
         complete, objective, relevant, timely and understandable.

         Further,  within the scope of their  duties,  Covered  Officers  having
         direct or supervisory authority over Fund disclosure documents or other
         public Fund communications will, to the extent appropriate within their
         area of responsibility, endeavor to ensure full, fair, timely, accurate
         and  understandable  disclosure  in  Fund  disclosure  documents.  Such
         Covered Officers will oversee, or appoint others to oversee,  processes
         for the timely and accurate  creation and review of all public  reports
         and regulatory filings. Within the scope of his or her responsibilities
         as a Covered  Officer,  each  Covered  Officer  also  will  familiarize
         himself or herself with the disclosure  requirements  applicable to the
         Fund,  as well as the business and  financial  operations  of the Fund.
         Each Covered  Officer  also will adhere to, and will promote  adherence
         to, applicable disclosure controls, processes and procedures, including
         DeAM's Disclosure Controls and Procedures,  which govern the process by
         which Fund disclosure documents are created and reviewed.

         To the extent that Covered  Officers  participate  in the creation of a
         Fund's  books or records,  they must do so in a way that  promotes  the
         accuracy, fairness and timeliness of those records.

         E. Compliance with Applicable Laws, Rules and Regulations

         In connection with his or her duties and within the scope of his or her
         responsibilities as a Covered Officer, each Covered Officer must comply
         with governmental  laws, rules and regulations,  accounting  standards,
         and  Fund   policies/procedures   that   apply  to  his  or  her  role,
         responsibilities  and duties  with  respect  to the Funds  ("Applicable
         Laws").  These  requirements  do not  impose on  Covered  Officers  any
         additional  substantive duties.  Additionally,  Covered Officers should
         promote compliance with Applicable Laws.

         If a Covered  Officer  knows of any material  violations  of Applicable
         Laws or suspects that such a violation may have  occurred,  the Covered
         Officer  is  expected  to  promptly  report  the  matter  to  the  DeAM
         Compliance Officer.

                                       6
<PAGE>

IV.          Violation Reporting

         A.  Overview

         Each  Covered  Officer  must  promptly  report  to the DeAM  Compliance
         Officer,   and  promote  the  reporting  of,  any  known  or  suspected
         violations of the Officer Code.  Failure to report a violation may be a
         violation of the Officer Code.

         Examples of violations of the Officer Code include, but are not limited
         to, the following:

         o        Unethical or dishonest behavior

         o        Obvious lack of adherence to policies  surrounding  review and
                  approval of public communications and regulatory filings

         o        Failure to report  violations  of the Officer  Code

         o        Known or obvious deviations from Applicable Laws

         o        Failure to  acknowledge  and certify  adherence to the Officer
                  Code

         The  DeAM  Compliance  Officer  has the  authority  to take any and all
         action he or she considers appropriate in his or her sole discretion to
         investigate  known or suspected Code violations,  including  consulting
         with  the  Fund's  Board,  the  independent  Board  members,   a  Board
         committee,  the Fund's legal counsel and/or counsel to the  independent
         Board members. The Compliance Officer also has the authority to use all
         reasonable resources to investigate violations,  including retaining or
         engaging legal counsel, accounting firms or other consultants,  subject
         to  applicable  law.(3) The costs  associated  with such actions may be
         borne by the Fund, if appropriate,  after  consultation with the Fund's
         Board (or committee  thereof).  Otherwise,  such costs will be borne by
         DeAM.

         B. How to Report

         Any known or suspected  violations of the Officer Code must be promptly
         reported to the DeAM Compliance Officer.

         C. Process for Violation Reporting to the Fund Board

         The DeAM Compliance  Officer will promptly report any violations of the
         Code to the Fund's Board (or committee thereof).

         D. Sanctions for Code Violations

         Violations of the Code will be taken seriously. In response to reported
         or otherwise known  violations,  DeAM and the relevant Fund's Board may
         impose sanctions  within the scope of their  respective  authority over
         the Covered Officer at issue.  Sanctions  imposed by DeAM could include
         termination  of employment.  Sanctions  imposed by a Fund's Board could
         include termination of association with the Fund.

V.           Waivers from the Officer Code

         A  Covered  Officer  may  request  a waiver  from the  Officer  Code by
         transmitting  a written  request  for a waiver  to the DeAM  Compliance
         Officer.(4)  The request must include the rationale for the request and
         must explain how the waiver would be in furtherance of the standards of
         conduct  described in and underlying  purposes of the Officer Code. The
         DeAM  Compliance  Officer will present this  information


- ------------------------
(3) For example, retaining a Fund's independent accounting firm may require
pre-approval by the Fund's audit committee.

(4) Of course, it is not a waiver of the Officer Code if the Fund's Board (or
committee thereof) determines that a matter is not a deviation from the Officer
Code's requirements or is otherwise not covered by the Code.

                                       7
<PAGE>

         to the Fund's Board (or committee  thereof).  The Board (or  committee)
         will determine  whether to grant the requested waiver. If the Board (or
         committee)  grants the requested  waiver,  the DeAM Compliance  Officer
         thereafter  will  monitor  the  activities  subject to the  waiver,  as
         appropriate, and will promptly report to the Fund's Board (or committee
         thereof) regarding such activities, as appropriate.

         The DeAM Compliance Officer will coordinate and facilitate any required
         public disclosures of any waivers granted or any implicit waivers.

VI.          Amendments to the Code

         The DeAM  Compliance  Officer will review the Officer Code from time to
         time for its continued  appropriateness and will propose any amendments
         to the  Fund's  Board (or  committee  thereof)  on a timely  basis.  In
         addition, the Board (or committee thereof) will review the Officer Code
         at least annually for its continued  appropriateness  and may amend the
         Code as necessary or appropriate.

         The DeAM Compliance Officer will coordinate and facilitate any required
         public disclosures of Code amendments.

VII.         Acknowledgement and Certification of Adherence to the Officer Code

         Each  Covered  Officer  must sign a  statement  upon  appointment  as a
         Covered Officer and annually  thereafter  acknowledging  that he or she
         has  received  and read the Officer  Code,  as amended or updated,  and
         confirming  that  he or she has  complied  with  it  (see  Appendix  B:
         Acknowledgement  and  Certification  of  Obligations  Under the Officer
         Code).

         Understanding  and  complying  with the  Officer  Code  and  truthfully
         completing the  Acknowledgement  and Certification Form is each Covered
         Officer's obligation.

         The DeAM Compliance Officer will maintain such  Acknowledgements in the
         Fund's books and records.

VIII.        Scope of Responsibilities

         A Covered Officer's responsibilities under the Officer Code are limited
         to:

                  (1)      Fund  matters  over  which  the  Officer  has  direct
                           responsibility  or  control,  matters  in  which  the
                           Officer  routinely  participates,  and  matters  with
                           which  the  Officer  is  otherwise   involved  (i.e.,
                           matters  within  the scope of the  Covered  Officer's
                           responsibilities as a Fund officer); and

                  (2)      Fund   matters  of  which  the   Officer  has  actual
                           knowledge.


IX.          Recordkeeping

         The DeAM  Compliance  Officer  will  create  and  maintain  appropriate
         records regarding the implementation and operation of the Officer Code,
         including records relating to conflicts of interest  determinations and
         investigations of possible Code violations.

                                       8
<PAGE>

X.           Confidentiality

         All reports and records prepared or maintained pursuant to this Officer
         Code  shall be  considered  confidential  and shall be  maintained  and
         protected  accordingly.  Except as  otherwise  required  by law or this
         Officer Code,  such matters shall not be disclosed to anyone other than
         the DeAM Compliance  Officer,  the Fund's Board (or committee thereof),
         legal counsel, independent auditors, and any consultants engaged by the
         Compliance Officer.


                                       9
<PAGE>

         Appendices

         Appendix A:



         List of Officers Covered under the Code, by Board:

<TABLE>
<CAPTION>
=========================================== ============================== =========================== ============================
                Fund Board                     Principal Executive            Principal Financial               Treasurer
                                                     Officers                       Officers
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
<S>                                         <C>                            <C>                         <C>
Boston                                      Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
Chicago                                     Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
Closed End (except Germany)                 Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
Korea                                       Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
New York                                    Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
MSIS                                        Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
Hedge Strategies Fund                       Julian Sluyters                Alexandra A. Toohey         Alexandra A. Toohey
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
Germany*                                    Julian Sluyters                Paul Schubert               Paul Schubert
- ------------------------------------------- ------------------------------ --------------------------- ----------------------------
Topiary BPI                                 Julian Sluyters                Alexandra A. Toohey         Alexandra A. Toohey
=========================================== ============================== =========================== ============================
</TABLE>

* Central Europe and Russia, Germany, and New Germany Funds


         DeAM Compliance Officer:

         Name: Joseph Yuen

         DeAM Department: Compliance

         Phone Numbers: 212-454-7443

         Fax Numbers: 212-454-4703









As of:   August, 2005

                                       10
<PAGE>

Appendix B: Acknowledgement and Certification


                    Initial Acknowledgement and Certification
                      of Obligations Under the Officer Code



- --------------------------------------------------------------------------------
Print Name             Department                  Location         Telephone





     1.   I  acknowledge  and  certify  that I am a  Covered  Officer  under the
          Scudder Fund Principal  Executive and Financial Officer Code of Ethics
          ("Officer Code"), and therefore subject to all of its requirements and
          provisions.

     2.   I have  received  and  read the  Officer  Code  and I  understand  the
          requirements and provisions set forth in the Officer Code.

     3.   I have  disclosed any conflicts of interest of which I am aware to the
          DeAM Compliance Officer.

     4.   I will act in the best  interest  of the Funds for which I serve as an
          officer  and  have   maintained   the   confidentiality   of  personal
          information about Fund shareholders.

     5.   I will report any known or suspected violations of the Officer Code in
          a timely manner to the DeAM Compliance Officer.












- --------------------------------------------------------------------------------
Signature                                                   Date


                                       11
<PAGE>

                    Annual Acknowledgement and Certification
                      of Obligations Under the Officer Code



- --------------------------------------------------------------------------------
Print Name              Department                    Location         Telephone




     6.   I  acknowledge  and  certify  that I am a  Covered  Officer  under the
          Scudder Fund Principal  Executive and Financial Officer Code of Ethics
          ("Officer Code"), and therefore subject to all of its requirements and
          provisions.

     7.   I have  received  and read the  Officer  Code,  and I  understand  the
          requirements and provisions set forth in the Officer Code.

     8.   I have adhered to the Officer Code.

     9.   I have not  knowingly  been a party to any conflict of  interest,  nor
          have I had actual  knowledge  about  actual or apparent  conflicts  of
          interest  that I did not  report  to the DeAM  Compliance  Officer  in
          accordance with the Officer Code's requirements.

     10.  I have acted in the best interest of the Funds for which I serve as an
          officer  and  have   maintained   the   confidentiality   of  personal
          information about Fund shareholders.

     11.  With respect to the duties I perform for the Fund as a Fund officer, I
          believe  that  effective  processes  are in place to  create  and file
          public   reports  and   documents  in   accordance   with   applicable
          regulations.

     12.  With respect to the duties I perform for the Fund as a Fund officer, I
          have complied to the best of my knowledge with all Applicable Laws (as
          that term is  defined  in the  Officer  Code)  and have  appropriately
          monitored  those  persons under my  supervision  for  compliance  with
          Applicable Laws.

     13.  I have reported any known or suspected  violations of the Officer Code
          in a timely manner to the DeAM Compliance Officer.












- --------------------------------------------------------------------------------
Signature                                                   Date


                                       12
<PAGE>



Appendix C: Definitions

Principal  Executive Officer  Individual  holding the office of President of the
Fund or series of Funds, or a person performing a similar function.

Principal  Financial Officer  Individual  holding the office of Treasurer of the
Fund or series of Funds, or a person performing a similar function.

Registered   Investment  Management  Investment  Company  Registered  investment
companies  other than a  face-amount  certificate  company or a unit  investment
trust.

Waiver A waiver is an approval of an exemption from a Code requirement.

Implicit  Waiver An  implicit  waiver is the  failure  to take  action  within a
reasonable  period of time regarding a material  departure from a requirement or
provision  of the Officer  Code that has been made known to the DeAM  Compliance
Officer or the Fund's Board (or committee thereof).


                                       13
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>31
<FILENAME>cert.txt
<DESCRIPTION>CERTIFICATION
<TEXT>




                                                Deutsche Asset Management [LOGO]
                                             A Member of the Deutsche Bank Group


Chief Executive Officer
Form N-CSR Certification under Sarbanes Oxley Act






I, Julian Sluyters, certify that:

1.                I have reviewed this report, filed on behalf of The Korea
                  Fund, Inc., on Form N-CSR;

2.                Based on my knowledge, this report does not contain any untrue
                  statement of a material fact or omit to state a material fact
                  necessary to make the statements made, in light of the
                  circumstances under which such statements were made, not
                  misleading with respect to the period covered by this report;

3.                Based on my knowledge, the financial statements, and other
                  financial information included in this report, fairly present
                  in all material respects the financial condition, results of
                  operations, changes in net assets, and cash flows (if the
                  financial statements are required to include a statement of
                  cash flows) of the registrant as of, and for, the periods
                  presented in this report;

4.                The registrant's other certifying officer(s) and I are
                  responsible for establishing and maintaining disclosure
                  controls and procedures (as defined in Rule 30a-3(c) under the
                  Investment Company Act of 1940) and internal control over
                  financial reporting (as defined in Rule 30a-3(d) under the
                  Investment Company Act of 1940) for the registrant and have:

                  (a)   Designed such disclosure controls and procedures, or
                        caused such disclosure controls and procedures to be
                        designed under our supervision, to ensure that material
                        information relating to the registrant, including its
                        consolidated subsidiaries, is made known to us by others
                        within those entities, particularly during the period in
                        which this report is being prepared;
<PAGE>

                  (b)   Designed such internal control over financial reporting,
                        or caused such internal control over financial reporting
                        to be designed under our supervision, to provide
                        reasonable assurance regarding the reliability of
                        financial reporting and the preparation of financial
                        statements for external purposes in accordance with
                        generally accepted accounting principles;

                  (c)   Evaluated the effectiveness of the registrant's
                        disclosure controls and procedures and presented in this
                        report our conclusions about the effectiveness of the
                        disclosure controls and procedures, as of a date within
                        90 days prior to the filing date of this report based on
                        such evaluation; and

                  (d)   Disclosed in this report any change in the registrant's
                        internal control over financial reporting that occurred
                        during the registrant's most recent fiscal half-year
                        (the registrant's second fiscal half-year in the case of
                        an annual report) that has materially affected, or is
                        reasonably likely to materially affect, the registrant's
                        internal control over financial reporting; and

5.                The registrant's other certifying officer(s) and I have
                  disclosed to the registrant's auditors and the audit committee
                  of the registrant's board of directors (or persons performing
                  the equivalent functions):

                  (a)   All significant deficiencies and material weaknesses in
                        the design or operation of internal control over
                        financial reporting which are reasonably likely to
                        adversely affect the registrant's ability to record,
                        process, summarize, and report financial information;
                        and

                  (b)   Any fraud, whether or not material, that involves
                        management or other employees who have a significant
                        role in the registrant's internal control over financial
                        reporting.

August 31, 2005                                      /s/ Julian Sluyters
                                                     Julian Sluyters
                                                     Chief Executive Officer
                                                     The Korea Fund, Inc.




<PAGE>

                                                Deutsche Asset Management [LOGO]
                                             A Member of the Deutsche Bank Group



Chief Financial Officer
Form N-CSR Certification under Sarbanes Oxley Act






I, Paul Schubert, certify that:

1.                I have reviewed this report, filed on behalf of The Korea
                  Fund, Inc., on Form N-CSR;

2.                Based on my knowledge, this report does not contain any untrue
                  statement of a material fact or omit to state a material fact
                  necessary to make the statements made, in light of the
                  circumstances under which such statements were made, not
                  misleading with respect to the period covered by this report;

3.                Based on my knowledge, the financial statements, and other
                  financial information included in this report, fairly present
                  in all material respects the financial condition, results of
                  operations, changes in net assets, and cash flows (if the
                  financial statements are required to include a statement of
                  cash flows) of the registrant as of, and for, the periods
                  presented in this report;

4.                The registrant's other certifying officer(s) and I are
                  responsible for establishing and maintaining disclosure
                  controls and procedures (as defined in Rule 30a-3(c) under the
                  Investment Company Act of 1940) and internal control over
                  financial reporting (as defined in Rule 30a-3(d) under the
                  Investment Company Act of 1940) for the registrant and have:

                  (a)   Designed such disclosure controls and procedures, or
                        caused such disclosure controls and procedures to be
                        designed under our supervision, to ensure that material
                        information relating to the registrant, including its
                        consolidated subsidiaries, is made known to us by others
                        within those entities, particularly during the period in
                        which this report is being prepared;
<PAGE>

                  (b)   Designed such internal control over financial reporting,
                        or caused such internal control over financial reporting
                        to be designed under our supervision, to provide
                        reasonable assurance regarding the reliability of
                        financial reporting and the preparation of financial
                        statements for external purposes in accordance with
                        generally accepted accounting principles;

                  (c)   Evaluated the effectiveness of the registrant's
                        disclosure controls and procedures and presented in this
                        report our conclusions about the effectiveness of the
                        disclosure controls and procedures, as of a date within
                        90 days prior to the filing date of this report based on
                        such evaluation; and

                  (d)   Disclosed in this report any change in the registrant's
                        internal control over financial reporting that occurred
                        during the registrant's most recent fiscal half-year
                        (the registrant's second fiscal half-year in the case of
                        an annual report) that has materially affected, or is
                        reasonably likely to materially affect, the registrant's
                        internal control over financial reporting; and

5.                The registrant's other certifying officer(s) and I have
                  disclosed to the registrant's auditors and the audit committee
                  of the registrant's board of directors (or persons performing
                  the equivalent functions):

                  (a)   All significant deficiencies and material weaknesses in
                        the design or operation of internal control over
                        financial reporting which are reasonably likely to
                        adversely affect the registrant's ability to record,
                        process, summarize, and report financial information;
                        and

                  (b)   Any fraud, whether or not material, that involves
                        management or other employees who have a significant
                        role in the registrant's internal control over financial
                        reporting.

August 31, 2005                                      /s/ Paul Schubert
                                                     Paul Schubert
                                                     Chief Financial Officer
                                                     The Korea Fund, Inc.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.906CERT
<SEQUENCE>32
<FILENAME>cert906.txt
<DESCRIPTION>906 CERTIFICATION
<TEXT>



                                                Deutsche Asset Management [LOGO]
                                             A Member of the Deutsche Bank Group



Chief Executive Officer
Section 906 Certification under Sarbanes Oxley Act





I, Julian Sluyters, certify that:

1.       I have reviewed this report, filed on behalf The Korea Fund, Inc., on
         Form N-CSR;

2.       Based on my knowledge and pursuant to 18 U.S.C. ss. 1350, the periodic
         report on Form N-CSR (the "Report") fully complies with the
         requirements of ss. 13 (a) or ss.15 (d), as applicable, of the
         Securities Exchange Act of 1934 and that the information contained in
         the Report fairly presents, in all material respects, the financial
         condition and results of operations of the Company.




August 31, 2005                                      /s/ Julian Sluyters
                                                     Julian Sluyters
                                                     Chief Executive Officer
                                                     The Korea Fund, Inc.





<PAGE>


                                                Deutsche Asset Management [LOGO]
                                             A Member of the Deutsche Bank Group




Chief Financial Officer
Section 906 Certification under Sarbanes Oxley Act





I, Paul Schubert, certify that:

1.       I have reviewed this report, filed on behalf of The Korea Fund, Inc.,
         on Form N-CSR;

2.       Based on my knowledge and pursuant to 18 U.S.C. ss. 1350, the periodic
         report on Form N-CSR (the "Report") fully complies with the
         requirements of ss. 13 (a) or ss. 15 (d), as applicable, of the
         Securities Exchange Act of 1934 and that the information contained in
         the Report fairly presents, in all material respects, the financial
         condition and results of operations of the Company.



August 31, 2005                                      /s/ Paul Schubert
                                                     Paul Schubert
                                                     Chief Financial Officer
                                                     The Korea Fund, Inc.



</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
