REPORT DIGEST

UNIVERSITY OF ILLINOIS FOUNDATION

FINANCIAL AUDIT

For the Year Ended:

June 30, 2004

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

      There were no material findings of noncompliance disclosed during our examination.  We commend the Foundation for maintaining an effective system of internal controls.

AUDITORS’ OPINION

      Our auditors stated the Foundation’s June 30, 2004 financial statements are fairly presented in all material respects.

____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:KMA:pp

SPECIAL ASSISTANT AUDITORS

      Our special assistant auditors were Clifton Gunderson LLP.

{Expenditures and Activity Measures are summarized on the reverse page.}

FINANCIAL OPERATIONS (All Funds) (in thousands)

FY 2004

FY 2003

OPERATING REVENUES.................................................

OPERATING EXPENSES...................................................

      Operating income (loss).....................................................

NONOPERATING REVENUES (EXPENSES)

      Net investment income.......................................................

      Net increase in fair value of investments..............................

      Loss on disposal of capital assets.......................................

      Interest on indebtedness.....................................................

            Net nonoperating revenues (expenses).........................

            Income (Loss) before other revenues, expenses, gains .         and losses........................................................................

            Additions to permanent endowments............................

                  Increase in net assets.............................................

NET ASSETS

      Net Assets - beginning of year...........................................

      Net Assets - end of year....................................................

$101,144

$139,718

$(38,574)

$4,876

98,121

0

(129)

$102,868

$64,294

40,519

$104,813

$757,443

$862,256

$109,504

$135,463

$(25,959)

$7,039

6,416

(1)

(194)

$13,260

$(12,699)

21,525

$8,826

$748,617

$757,443

OTHER SIGNIFICANT ACCOUNT BALANCES

      (in thousands)

At June 30,

2004

At June 30,

2003

Cash and Investments..............................................................

Farms and Real Estate.............................................................

Total Assets..........................................................................

Accounts Payable....................................................................

Annuities Payable....................................................................

Total Liabilities.....................................................................

Net Assets - Restricted - Nonexpendable................................

Net Assets - Restricted - Expendable......................................

Total Net Assets...................................................................

$873,157

$25,103

$956,804

$29,890

$49,827

$94,548

$569,006

$279,567

$862,256

$764,483

$23,210

$850,621

$35,826

$44,822

$93,178

$467,277

$276,277

$757,443

FOUNDATION PRESIDENT

During Audit Period:  Dr. Sidney Micek

Currently:  Dr. Sidney Micek