09:17     GRAND FIELD GP<00115> - Results Announcement (2)                    

    3.      SUMMARY OF AUDITORS' OPINION                                      
                                                                              
    Qualified opinion arising from disagreement about accounting treatment    
                                                                              
    In the previous years, the Group had made a provision for the land        
    appreciation tax (the "LAT"), amounting to HK$17,254,000, arising from the
    property development activities in the PRC.  According to the letter from 
    the local tax authorities, as the LAT has not yet been levied in Shenzhen 
    and the Group did not have any LAT liability as at 31 December, 2004.  In 
    the opinion of the directors, after a legal advice was sought from the    
    local lawyer, this provision is not required to pay and therefore the     
    provision for this LAT was written back and accounted for as an income    
    during the year.  However, based on the evidence provided to us and       
    considering that there has been no change in the tax regulations in the   
    PRC in respective of the LAT since this provision was made, in our        
    opinion, the appropriateness of writing back the LAT provision and        
    recognizing the balance as an income in the Group's financial statements  
    for the year ended 31 December 2004 cannot be ascertained.                
                                                                              
    Except for the accounting treatment on the write back of the LAT          
    provision, in our opinion, the financial statements give a true and fair  
    view of the state of the affairs of the Company and of the Group as at 31 
    December, 2004 and of the Group's profit and cash flows for the year then 
    ended and have been properly prepared in accordance with the disclosure   
    requirements of the Hong Kong Companies Ordinance.