<PAGE>
REPORT ON EXAMINATION OF SECURITIES PURSUANT TO RULE 17F-2
To the Board of Directors of The Emerging Germany Fund Inc.:
We have examined the securities represented by the investment accounts included
on the books and records of The Emerging Germany Fund Inc. ("The Fund") for the
period from the date of our last similar examination on December 31, 1997 to
February 20, 1998. Our examination was performed without prior notice to the
Fund and in accordance with Rule 17f-2 of the Investment Company Act of 1940, as
amended. It is understood that this report is solely for the use of management
of The Emerging Germany Fund and the Securities and Exchange Commission and
should not be used for any other purpose.
We performed the following procedures with respect to securities owned by The
Funds as of the close of business on February 20, 1998:
All securities owned by the Funds are custodied with State Street Bank
and Trust Company ("State Street"). All Deutschemark denominated
securities held by the Funds will be custodied with Dresdner Bank AG
as Sub Custodian for State Street. All securities custodied with
Dresdner Bank AG are custodied in book entry method. All securities
owned by The Emerging Germany Fund Inc. are held by Dresdner AG in
commingled omnibus accounts.
We reviewed State Street's daily exception reports which compare the
safekeeping reports of securities held by the Funds to those held by
Dresdner Bank AG, on omnibus account basis, from December 31, 1997
(the date of our last security count) to February 20, 1998 noting that
the exceptions on the reports, if any, for the Funds had been resolved
during the period. On a test basis, we agreed securities shown on the
State Street safekeeping reports to share positions from Dresdner Bank
AG.
Securities designated as securities of the Funds on State Street's
safekeeping reports were traced to the books and records of the Funds,
noting agreement except for securities purchased/sold but not
received/delivered on that date, as to which we requested confirmation
from the brokers and for securities on loan, for which we obtained
confirmation from State Street.
<PAGE>
We are relying on the Dresdner Bank AG Safe Audit performed on the
internal controls of Dresdner Bank AG over the reconciliation
process between Dresdner and the central depository, Deutscher
Kassenverein AG, ("the DKV"). We reviewed the daily reconciliation
between Dresdner Bank's records and the DKV's records and noted that
the exceptions or unmatched items on the report, if any, had been
resolved in a timely manner during the period.
Because the above procedures do not constitute an audit in accordance with
generally accepted auditing standards, we do not express an opinion on the
specified investment accounts referred to above. In connection with the
procedures referred to above, no matters came to our attention that caused us
to believe that the specified accounts should be adjusted. Had we performed
additional procedures or had we audited the financial statements in accordance
with generally accepted auditing standards, matters might have come to our
attention that would have been reported to you. This report related only to
the investments specified above and does not extend to any financial
statements of The Emerging Germany Fund, Inc. taken as a whole.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts PricewaterhouseCoopers LLP
September 21, 1998
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
UNITED STATES ------------------------------
SECURITIES AND EXCHANGE COMMISSION OMB APPROVAL
WASHINGTON, D.C. 20549 ------------------------------
OMB Number: 3235-0360
FORM N-17f-2 Expires:
Certificate of Accounting of Securities and Similar Estimated average burden
Investments in the Custody of hours per response..... 0.05
Management Investment Companies ------------------------------
Pursuant to Rule 17f-2 [17 CFR 270.17f-2]
- -----------------------------------------------------------------------------------------------------------
1. Investment Company Act File Number: Date examination completed:
811- 6038 February 20, 1998
- -----------------------------------------------------------------------------------------------------------
2. State identification Number:
------------------------------------------------------------------------------------------------------
AL AK AZ AR CA CO
------------------------------------------------------------------------------------------------------
CT DE DC FL GA HI
------------------------------------------------------------------------------------------------------
ID IL IN IA KS KY
------------------------------------------------------------------------------------------------------
LA ME MD MA MI MN
------------------------------------------------------------------------------------------------------
MS MO MT NE NV NH
------------------------------------------------------------------------------------------------------
NJ NM NY NC ND OH
------------------------------------------------------------------------------------------------------
OK OR PA RI SC SD
------------------------------------------------------------------------------------------------------
TN TX UT VT VA WA
------------------------------------------------------------------------------------------------------
WV WI WY PUERTO RICO
------------------------------------------------------------------------------------------------------
Other (specify):
- -----------------------------------------------------------------------------------------------------------
3. Exact name of investment company as specified in registration statement:
The Emerging Germany Fund, Inc.
- -----------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
4. Address of principal executive office (number, street, city, state, zip code):
4 Embarcadero Center, San Francisco, CA 94111
- -----------------------------------------------------------------------------------------------------------
</TABLE>
INSTRUCTIONS
This Form must be completed by investment companies that have custody of
securities or similar investments.
INVESTMENT COMPANY
1. All items must be completed by the investment company.
2. Give this Form to the independent public accountant who, in compliance
with Rule 17f-2 under the Act and applicable state law, examines securities
and similar investments in the custody of the investment company.
ACCOUNTANT
3. Submit this Form to the Securities and Exchange Commission and appropriate
state securities administrators when filing the certificate of accounting
required by Rule 17f-2 under the Act and applicable state law. File the
original and one copy with the Securities and Exchange Commission's principal
office in Washington, D.C., one copy with the regional office for the region
in which the investment company's principal business operations are
conducted, and one copy with the appropriate state administrator(s), if
applicable.
THIS FORM MUST BE GIVEN TO YOUR INDEPENDENT PUBLIC ACCOUNTANT
