INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholder of
BLK Subsidiary, Inc.
In planning and performing our audit of the financial
statements of BLK Subsidiary, Inc. (the "Trust") for the
year ended June 30, 2000 (on which we have issued our report dated
August 7, 2000), we considered its internal control, including
control activities for safeguarding securities, in order to
determine our auditing procedures for the purpose of
expressing our opinion on the financial statements and to comply
with the requirements of Form N-SAR, and not to provide assurance
on the Trust's internal control.
The management of the Trust is responsible for establishing and
maintaining internal control. In fulfilling this responsibility,
estimates and judgments by management are required to assess the
expected benefits and related costs of controls. Generally,
controls that are relevant to an audit pertain to the entity's
objective of preparing financial statements for external purposes
that are fairly presented in conformity with generally accepted
accounting principles. Those controls include the safeguarding
of assets against unauthorized acquisition, use or disposition.
Because of inherent limitations in any internal control,
misstatements due to error or fraud may occur and not be detected.
Also, projections of any evaluation of internal control to future
periods are subject to the risk that the internal control may
become inadequate because of changes in conditions, or that the
degree of compliance with policies or procedures may deteriorate.
Our consideration of the Trust's internal control would not
necessarily disclose all matters in internal control that might
be material weaknesses under standards established by the American
Institute of Certified Public Accountants. A material weakness is
a condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low
level the risk that misstatements caused by error or fraud in
amounts that would be material in relation to the financial
statements being audited may occur and not be detected within
a timely period by employees in the normal course of performing
their assigned functions. However, we noted no matters involving
the Trust's internal control and its operation, including controls
for safeguarding securities, that we consider to be material
weaknesses as defined above as of June 30, 2000.
This report is intended solely for the information and use of
management, the Board of Directors of BLK Subsidiary, Inc., and
the Securities and Exchange Commission, and is not intended to be
and should not be used by anyone other than these specified parties.
August 7, 2000