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SIGNATURE DAVID BLIVIN
TITLE DIRECTOR
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<PAGE>
[ERNST & YOUNG LLP Letterhead]
Board of Directors
Southeast Interactive Technology Fund I
In planning and performing our audit of the financial statements of Southeast
Interactive Technology Fund I for the year ended December 31, 1998, we
considered its internal control, including procedures 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, not to provide assurance on internal control.
The management of Southeast Interactive Technology Fund I 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 internal control policies and procedures.
Two of the objectives of internal control are to provide management with
reasonable, but not absolute, assurance that assets are safeguarded against loss
from unauthorized use or disposition and that transactions are executed in
accordance with management's authorization and recorded properly to permit
preparation of financial statements in conformity with generally accepted
accounting principles.
Because of inherent limitations in internal control, errors, or irregularities
may occur and not be detected. Also, projection of any evaluation of the
structure to future periods is subject to the risk that it may become inadequate
because of changes in conditions or that the effectiveness of the design and
operation may deteriorate.
Our consideration of 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 the
specific internal control elements does not reduce to a relatively low level the
risk that errors or irregularities 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 internal control, including
procedures for safeguarding securities, that we consider to be material
weaknesses as defined above as of December 31, 1998.
This report is intended solely for the information and use of management and the
Securities and Exchange Commission and is not intended to be and should not be
used by anyone other than these specified parties.
/s/ Ernst & Young LLP
Raleigh, North Carolina
February 15, 1999
<PAGE>
EXHIBIT #77 (k)- Changes in Registrants Certifying Accountants
At a meeting held on December 9, 1998, the Board of Directors of the Fund
approved the engagement of Ernst & Young as its independent auditors for the
fiscal year ending 12/31/98 to replace the firm of PricewaterhouseCoopers, LLP,
who declined to stand for reelection as auditors of the Fund effective November
20, 1998. The audit committee of the Board of Directors approved the change in
auditors on December 9, 1998 and was subsequently approved by the shareholders.
The reports of PricewaterhouseCoopers, LLP on the Fund's financial statements
for the past two fiscal years did not contain an adverse opinion or a disclaimer
of opinion and were not qualified as to uncertainty, audit scope, or accounting
principles. The report for the fiscal year end 12/31/97 was modified as to
uncertainty of the Fund's ability to continue as a going concern. In addition,
the report for the fiscal year end 12/31/97 was modified as to the uncertainty
of the Fund's Advisor's ability to continue performing advisory duties to the
Fund. Such uncertainties related to the Advisor were due to liquidity issues and
a possible violation of provisions of Section 206 of the Investment Advisers Act
of 1940, as amended, by advancing monies from another fund to the Advisor. These
monies were subsequently repaid and approved by the audit committee of the Board
of Directors of the other fund's Board. In connection with the audits of the
Fund's financial statements for each of the two fiscal years ended 12/31/97,
there were no disagreements with PricewaterhouseCoopers, LLP on any matters of
accounting principles or practices, financial statement disclosure, or auditing
scope and procedures which, if not resolved to the satisfaction of
PricewaterhouseCoopers, LLP would have caused PricewaterhouseCoopers, LLP to
make reference to the matter in their report. The Fund has requested
PricewaterhouseCoopers, LLP to furnish it a letter addressed to the Commission
stating whether it agrees with the above statements. A copy of that letter,
dated February 26, 1999 is filed as Exhibit 1 to this Form N-SAR.
<PAGE>
[PRICEWATERHOUSECOOPERS LETTERHEAD]
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
February 26, 1999
Ladies and Gentlemen:
We have read Item 77(k) of Southeast Interactive Technology Fund I, LLC's Form
N-SAR dated February 26, 1999 and are in agreement with the statements
contained therein.
Yours very truly,
/s/ PricewaterhouseCoopers LLP
