Exhibit 15.3

TELECOMMUNICATIONS SERVICES OF TRINIDAD AND

TOBAGO LIMITED





SPECIAL PURPOSE FINANCIAL STATEMENTS

31stMarch 2005





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

SPECIAL PURPOSE FINANCIAL STATEMENTS

TABLE
  OF CONTENTS



|                                             | Page
|-------------------------------------------- | ----
|                                             |     
|Corporate information                        |     
|                                             |     
|Directors report                            |     
|                                             |     
|Report of the Auditors                       |     
|                                             |     
|Balance sheet                                |     
|                                             |     
|Statement of income                          |     
|                                             |     
|Statement of cash flow                       |     
|                                             |     
|Statement of changes in shareholders equity |     
|                                             |     
|Notes to the financial statements            |     



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CORPORATE INFORMATION

|DIRECTORS               |  | Christian Mouttet  Chairman, BA
            Leonardo DeBarros, BSc
            Dr. Sharon-ann Gopaul-Mc Nicol
            John Jardim, FCIB, FCIS
            Mark Macfee, BA, FCA
            Jacqueline Quamina, MA, MBA (UWI), LLB
            Balroop Roopnarine, Attorney-at-Law
            Robert Rowley, FCMA
|----------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|CHIEF EXECUTIVE OFFICER |  | Carlos Espinal, BSC, MSc/PMD                                                                                                                                                                                                                                                                                          
|CORPORATE SECRETARY     |  | Norris E Campbell, BSc, FCCA, CA                                                                                                                                                                                                                                                                                      
|REGISTERED OFFICE       |  | 1 Edward Street
            Port of Spain
            Trinidad, W.I.                                                                                                                                                                                                                                                  
|PRINICIPAL BANKERS      |  | Scotiabank Trinidad and Tobago Limited
            Corner Park and Richmond Streets
            Port of Spain
            Trinidad, W.I.                                                                                                                                                                              
|BANK OF NOVA SCOTIA     |  | New York Agency
            One Liberty Plaza
            New, NY 10006
            USA                                                                                                                                                                                                                               
|AUDITORS                |  | KPMG
            4thFl Scotia Centre
            56-58 Richmond Street
            Port of Spain
            P.O. Box 1328
            Trinidad, W.I.                                                                                                                                                                 
|PRINCIPAL ATTORNEYS     |  | J.D. Sellier and Company
            129-131 Abercromby Street
            Port of Spain
            Trinidad, W.I.                                                                                                                                                                                                   





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DIRECTORS REPORT

The Directors have pleasure in submitting their Report and the Special Purpose Financial Statements for the year ended 31stMarch, 2005.



|Financial Results                  |  | TT$000   |  
|---------------------------------- |  | --------- | -
|                                   |  |           |  
|Profit for the year after taxation |  | 293,829   |  
|Retained earnings brought forward  |  | 2,210,469 |  
|                                   |  | 2,504,298 |  
|Dividend paid                      |  | (187,537  | )
|Retained earnings carried forward  |  | 2,316,761 |  

Dividends

In addition to the declared interim dividend of TT$65.2 million, the Board of Directors recommends the payment of a final dividend of TT$81.7 million which would be in keeping with the dividend policy stated in the Shareholders Agreement.

Directors

The following Directors served during the period under review:

Mr. Christian Mouttet, Chairman, Ms. Lisa Agard (resigned 10thJanuary, 2005), Dr, Sharon-ann Gopaul-Mc Nicol, Mr. Mark Macfee, Mr. John Jardim, Ms. Jacqueline Quamina, Mr. Balroop Roopnarine, Mr. Robert Rowley, Mr. Leonardo DeBarros (elected 11thJanuary, 2005), Mr. Paul Rodgers (resigned 27thJuly, 2004)

Auditors

The audit firm of KPMG was appointed to perform the audit of these special purpose financial statements.

Annual Meeting

The Thirty-Fifth Annual Meeting of the Company was held on 11thAugust, 2004





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REPORT OF THE INDEPENDENT AUDITORS

To the Directors of Telecommunications Services of Trinidad and Tobago Limited

We have audited the accompanying balance sheet of Telecommunications Services of Trinidad and Tobago Limited (the Company) as at March 31, 2005 and the related income statement, statement of cash flows and statement of changes in shareholders equity for the year ended March 31, 2005 as set out on pages 5 to 30. These special purpose financial statements are the responsibility of the management of the Company. Our responsibility is to express an opinion on these special purpose financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the special purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall special purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the special purpose financial statements present fairly, in all material respects, the financial position of the Company as at March 31, 2005, the results of its operations, changes in its shareholders equity and its cash flows for the year then ended, in accordance with International Financial Reporting Standards.

International Financial Reporting Standards vary in certain significant respects from accounting principles generally accepted in the United States of America. Information relating to the nature of such differences is presented in Note 23 to the special purpose financial statements.











KPMG Trinidad and Tobago

Port of Spain

Date: September 12th, 2005





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

BALANCE SHEET

AS AT 31ST MARCH, 2005



|                                           |  | Notes |   | 2005TT$000 |           |  | Unaudited2004TT$000 |           | 
|------------------------------------------ |  | ----- | - | ----------- | --------- |  | -------------------- | --------- | 
|ASSETS                                     |  |       |   |             |           |  |                      |           | 
|Non-current assets                         |  |       |   |             |           |  |                      |           | 
|Property, plant and equipment              |  | 3     |   |             | 2,979,336 |  |                      | 3,072,068 | 
|Defined benefit plans asset                |  | 4     | a |             | 415,800   |  |                      | 304,400   | 
|Deferred tax asset                         |  | 5     | c |             | 11,181    |  |                      | 7,612     | 
|Available for sale investment              |  | 2     | f |             |          |  |                      | 8,882     | 
|                                           |  |       |   |             | 3,406,317 |  |                      | 3,392,962 | 
|Current assets                             |  |       |   |             |           |  |                      |           | 
|Inventories                                |  | 7     |   |             | 158,692   |  |                      | 132,012   | 
|Accounts receivable and prepayments        |  | 8     |   |             | 457,908   |  |                      | 423,429   | 
|Short term investments                     |  |       |   |             | 4,623     |  |                      |          | 
|Construction work-in-progress              |  | 6     |   |             | 46,104    |  |                      | 34,080    | 
|Cash and cash equivalents                  |  | 9     |   |             | 268,138   |  |                      | 171,700   | 
|                                           |  |       |   |             | 935,465   |  |                      | 761,221   | 
|Total assets                               |  |       |   |             | 4,341,782 |  |                      | 4,154,183 | 
|                                           |  |       |   |             |           |  |                      |           | 
|SHAREHOLDERS EQUITY AND LIABILITIES       |  |       |   |             |           |  |                      |           | 
|Shareholders equity                       |  |       |   |             |           |  |                      |           | 
|Stated capital                             |  | 10    |   |             | 572,717   |  |                      | 572,717   | 
|Capital reserves                           |  |       |   |             |          |  |                      | 2,786     | 
|Retained earnings                          |  |       |   |             | 2,316,761 |  |                      | 2,210,469 | 
|                                           |  |       |   |             | 2,889,478 |  |                      | 2,785,972 | 
|Non-current liabilities                    |  |       |   |             |           |  |                      |           | 
|Retirement benefit obligations             |  | 4     | a |             | 29,694    |  |                      | 25,372    | 
|Borrowings-non current portion             |  | 11    | a |             | 298,330   |  |                      | 364,779   | 
|Deferred tax liability                     |  | 5     | d |             | 219,294   |  |                      | 167,275   | 
|                                           |  |       |   |             | 547,318   |  |                      | 557,426   | 
|Current liabilities                        |  |       |   |             |           |  |                      |           | 
|Employee benefits                          |  | 12    |   |             | 325,408   |  |                      | 150,073   | 
|Accounts payable and accruals              |  | 13    |   |             | 351,124   |  |                      | 399,908   | 
|Deferred revenue                           |  | 14    |   |             | 85,525    |  |                      | 37,411    | 
|Tax payable                                |  |       |   |             | 36,511    |  |                      | 124,083   | 
|Borrowings  current portion               |  | 11    | a |             | 106,418   |  |                      | 99,310    | 
|                                           |  |       |   |             | 904,986   |  |                      | 810,785   | 
|Total shareholders equity and liabilities |  |       |   |             | 4,341,782 |  |                      | 4,154,183 | 

The notes on pages 9 to 30 form part of these special purpose financial statements

The Board of Directors authorized these special purpose financial statements for issue on September 12th, 2005.





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

STATEMENT
  OF INCOME

FOR THE YEAR ENDED 31ST MARCH, 2005



|                                                  |  | Notes |  | 2005TT$000 |   | Unaudited2004TT$000 | 
|------------------------------------------------- |  | ----- |  | ----------- | - | -------------------- | 
|Gross operating revenue                           |  |       |  |             |   |                      | 
|Gross revenue                                     |  |       |  | 2,503,491   |   |                      | 
|Operating expenses                                |  |       |  |             |   |                      | 
|Cost of sales                                     |  | 15    |  | 325,010     |   |                      | 
|Personnel                                         |  |       |  | 560,350     |   |                      | 
|Voluntary separation cost                         |  |       |  | 251,000     |   |                      | 
|Depreciation                                      |  |       |  | 498,694     |   |                      | 
|Maintenance and repairs                           |  |       |  | 128,098     |   |                      | 
|Other                                             |  | 16    |  | 318,212     |   |                      | 
|                                                  |  |       |  | 2,081,364   |   |                      | 
|Operating profit                                  |  |       |  | 422,127     |   |                      | 
|Net finance cost                                  |  |       |  |             |   |                      | 
|Interest income                                   |  |       |  | 5,302       |   |                      | 
|Interest expense                                  |  |       |  | (23,431     | ) |                      | 
|                                                  |  |       |  | (18,129     | ) |                      | 
|Other Income                                      |  |       |  |             |   |                      | 
|Gain on disposal of available for sale investment |  | 2f    |  | 7,175       |   |                      | 
|Profit before taxation                            |  | 17    |  | 411,173     |   |                      | 
|Less: Taxation                                    |  | 5a    |  | 117,344     |   |                      | 
|Profit after taxation                             |  |       |  | 293,829     |   |                      | 

The notes on pages 9 to 30 form part of these special purpose financial statements





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

STATEMENT
  OF CASH FLOW

FOR THE YEAR ENDED 31ST MARCH, 2005



|                                                            |  | 2005TT$000 |   | Unaudited2004TT$000 | 
|----------------------------------------------------------- |  | ----------- | - | -------------------- | 
|Cash flows from operating activities                        |  |             |   |                      | 
|Profit for the year before taxation                         |  | 411,173     |   |                      | 
|Adjustments for:                                            |  |             |   |                      | 
|Foreign exchange (gain)/loss                                |  | (572        | ) |                      | 
|Gain on disposal of property, plant and equipment           |  | (329        | ) |                      | 
|Depreciation                                                |  | 498,694     |   |                      | 
|Finance costs                                               |  | 23,431      |   |                      | 
|Interest income                                             |  | (5,302      | ) |                      | 
|Interest received                                           |  | 6,037       |   |                      | 
|Gain on disposal of available for sale investment           |  | (7,175      | ) |                      | 
|Pension income and contributions paid                       |  | (111,400    | ) |                      | 
|Post employment medical costs and premiums paid             |  | 4,322       |   |                      | 
|Operating profit before working capital changes             |  | 818,879     |   |                      | 
|Increase in accounts receivable & prepayments               |  | (35,504     | ) |                      | 
|(Increase)/decrease in inventories                          |  | (26,680     | ) |                      | 
|Increase in construction work-in-progress                   |  | (12,024     | ) |                      | 
|Increase/(decrease) in employee benefits                    |  | 175,335     |   |                      | 
|Increase in accounts payable, accruals and deferred revenue |  | 2,920       |   |                      | 
|Cash generated from operations                              |  | 922,926     |   |                      | 
|Finance costs paid                                          |  | (26,048     | ) |                      | 
|Taxes paid                                                  |  | (156,466    | ) |                      | 
|Net cash generated from operating activities                |  | 740,412     |   |                      | 
|Cash flows from investing activities                        |  |             |   |                      | 
|Purchase of short-term investments                          |  | (4,623      | ) |                      | 
|Purchase of property, plant and equipment                   |  | (405,962    | ) |                      | 
|Proceeds from disposal of property, plant and equipment     |  | 220         |   |                      | 
|Proceeds from disposal of available for sale investment     |  | 13,273      |   |                      | 
|Net cash used in investing activities                       |  | (397,092    | ) |                      | 
|Cash flows from financing activities                        |  |             |   |                      | 
|Loan drawdowns                                              |  | 40,000      |   |                      | 
|Loan repayments                                             |  | (99,345     | ) |                      | 
|Dividends paid                                              |  | (187,537    | ) |                      | 
|Net cash used in financing activities                       |  | (246,882    | ) |                      | 
|Net increase/(decrease) in cash and cash equivalents        |  | 96,438      |   |                      | 
|Cash and cash equivalents at beginning of year              |  | 171,700     |   |                      | 
|Cash and cash equivalents at end of year (note 9)           |  | 268,138     |   |                      | 

The notes on pages 9 to 30 form part of these special purpose financial statements





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY

FOR THE YEAR ENDED 31ST MARCH, 2005



|                                              |  | StatedcapitalTT$000 |  | CapitalreservesTT$000 |   | RetainedearningsTT$000 |   | ShareholdersequityTT$000 |  
|--------------------------------------------- |  | -------------------- |  | ---------------------- | - | ----------------------- | - | -------------------------- | -
|Balance as at April 1st 2003  unaudited      |  | 572,717              |  | 2,786                  |   | 1,993,110               |   | 2,568,613                  |  
|Net profit after taxation - unaudited         |  |                     |  |                       |   | 449,562                 |   | 449,562                    |  
|Dividends paid - unaudited (note 21)          |  |                     |  |                       |   | (232,203                | ) | (232,203                   | )
|Balance as at March 31st 2004 - unaudited     |  | 572,717              |  | 2,786                  |   | 2,210,469               |   | 2,785,972                  |  
|                                              |  |                      |  |                        |   |                         |   |                            |  
|Balance as at April 1st 2004 - unaudited      |  | 572,717              |  | 2,786                  |   | 2,210,469               |   | 2,785,972                  |  
|Net profit after taxation                     |  |                     |  |                       |   | 293,829                 |   | 293,829                    |  
|Dividends paid (note 21)                      |  |                     |  |                       |   | (187,537                | ) | (187,537                   | )
|Realised gain on sale of investment (note 2f) |  |                     |  | (2,786                 | ) |                        |   | (2,786                     | )
|Balance as at March 31st 2005                 |  | 572,717              |  |                       |   | 2,316,761               |   | 2,889,478                  |  

The notes on pages 9 to 30 form part of these special purpose financial statements





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|1. | Incorporation
        and principal activity |  |    | The
        Company was incorporated in Trinidad and Tobago on May 1968 and on 15th
        April, 1999 the Company obtained its Certificate of Continuance under
        the Companies Act 1995. Its domestic operations are regulated by the Trinidad
        and Tobago Telephone Act Chapter 47:330 (Act 7 of 1968), subsequently
        amended in 1976 and 1990.
      The
        Companys registered office is located at 1 Edward Street, Port of
        Spain and its principal activity is the provision of both internal and
        external telecommunications services to the Republic of Trinidad and Tobago.
      Cable
        & Wireless (West Indies) Limited holds a 49% interest in the Company.
        The 51% shareholding held by the Government of Trinidad and Tobago was
        transferred to National Enterprises Limited on 19th September 2000. | 
|-- | -------------------------------------------- |  | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|2. | Statement
        of accounting policies     |  | a) | Basis
        of accounting                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|   |                                              |  |    | These
        special purpose financial statements are prepared under the historical
        cost convention, in accordance with International Financial Reporting
        Standards (IFRS). Note 23 sets out the qualitative differences
        between IFRS and Statement of Generally Accepted Accounting Principles
        in the United States of America (US GAAP).
      No
        account is taken of the effects of inflation.
      The
        financial information for 2004 is unaudited and have been prepared for
        comparative information purposes only.                                                                                                                                                                                                                                                                                                | 
|   |                                              |  | b) | Use
        of estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 
|   |                                              |  |    | The
        preparation of financial statements, in conformity with International
        Financial Reporting Standards, requires management to make estimates and
        assumptions that affect the reported amount of assets and liabilities
        and disclosure of contingent assets and liabilities at the date of the
        financial statements and the reported amounts of revenues and expenses
        during the reporting period. Actual results could differ from those estimated.                                                                                                                                                                                                                                                                                                                                                                                 | 
|   |                                              |  | c) | Foreign
        currency translation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|   |                                              |  |    | These
        financial statements are stated in Trinidad and Tobago dollars. The exchange
        rate ruling at the balance sheet date was US$1 = TT$6.2999 (March 2004:
        US$1 = TT$6.2998).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|2. | Statement
        of 
        accounting policies(continued) |  | c)   | Foreign
        currency translation(continued)
            Foreign currency transactions during the period are converted at the rates ruling at the date of the transaction or at a rate, which approximates the actual rate. Monetary assets and liabilities in foreign currencies at the balance sheet date are translated at rates ruling at that date. Profits or losses thus arising are dealt with in the statement of income.                                                                                                                                      | 
|-- | ------------------------------------------------------------ |  | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|   |                                                              |  | d)   | Property, plant and equipment
            Items of property, plant and equipment are stated at historical cost less accumulated depreciation and impairment allowances. The cost of self-constructed property, plant and equipment includes the cost of materials and direct labour.                                                                                                                                                                                                                                                                                       | 
|   |                                                              |  | (i)  | Plant in service
            Depreciation on property, plant and equipment is provided on a straight-line basis. The estimated useful lives of depreciable plant are as follows:                                                                                                                                                                                                                                                                                                                                                                                           | 
|   |                                                              |  |      | Properties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 
|   |                                                              |  |      | Freehold building                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 
|   |                                                              |  |      | Leasehold properties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|   |                                                              |  |      | Technical assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 
|   |                                                              |  |      | Central office equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
|   |                                                              |  |      | External cable plant                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|   |                                                              |  |      | Plant & machinery; Share of Americas 1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|   |                                                              |  |      | Towers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 
|   |                                                              |  |      | Underground conduit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|   |                                                              |  |      | Customers installations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
|   |                                                              |  |      | Other                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 
|   |                                                              |  |      | Furniture and office equipment including computers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|   |                                                              |  |      | Indefeasible Rights of Use                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 
|   |                                                              |  |      | Tools and implements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|   |                                                              |  |      | Vehicles                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
|   |                                                              |  |      | Land is not depreciated as it is deemed to have an indefinite life.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|   |                                                              |  | (ii) | Plant under construction
            Property, plant and equipment under construction are recorded as plant under construction (PUC) until they are ready for their intended use, thereafter they are transferred to the related category of property, plant and equipment and depreciated over their estimated useful lives. The cost of PUC includes allocation of labour and overhead in accordance with IAS 16, Property, Plant and Equipment. The total expenses capitalised for the year amounted to approximately TT$37 million (2004: TT$44 million, unaudited). | 





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|2.Statement
        of accounting policies(continued) |  | d)Property,
        plant and equipment(continued)
            (iii)Impairment
            The carrying amount of property, plant and equipment is reviewed whenever events or changes in circumstances indicate that impairment may have occurred, and where carrying values exceed this estimated recoverable amount, assets are written down to their recoverable amount.

      (iv)Repairs
        and renovations
            Repairs and renovations are normally expensed as they are incurred. Expenses are reported as assets only if the amounts involved are substantial and one or more of the following conditions are satisfied: the original useful life is prolonged, the production/service capacity is increased, the quality of the products/services is enhanced materially or production/service costs are reduced considerably.

      (v)Borrowing cost
            Interest cost on borrowings to finance capital expenditure on development projects are expensed during the period of time that is required to complete the asset for its intended use.

      e)Employee benefits
      (i)Retirement benefits plans
            The Company operates three defined benefit plans, namely the Textel Pension Plan, the Telco Staff Pension Fund Plan and the TSTT Pension Plan. The current employees are all covered by either the Telco Staff Pension Fund Plan or the TSTT Pension Fund Plan. The Textel Pension Fund Plan operates only to pay benefits to those pensioners who have opted to remain in that plan. However, the constructive benefit obligation is based on the benefit structure of the TSTT Pension Plan.
            For defined benefit plans, the pension accounting costs are assessed using the projected unit credit method. Under this method, the cost of providing pensions is charged to the statement of income so as to spread the regular cost over the service lives of employees in accordance with the advice of independent actuaries who carry out a full valuation of the plans every three years. The pension obligation is measured as the present value of the estimated future cash outflows. All actuarial gains and losses to be recognised are spread forward over the average remaining service lives of employees.
|----------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|2.Statement
        of accounting policies(continued) |  | ii)Post employment medical benefits
            The Company operates a post employment medical benefit plan that is insured with Colonial Life Insurance Company (CLICO). Medical benefits are available on retirement to all current retirees and employees. The plan has been in existence since 1st September, 1997 and is run alongside an arrangement to provide in-service medical benefits to employees. CLICO charges the Company one premium based on the number of current employees only. The premiums are met jointly by the Company and current employees only. No specific premiums are paid in respect of the cover provided to current retirees.
            The International Accounting Standard (IAS) 19 Employee Benefits requires the Company to account for the cost of the post-employment medical plan benefits during the period of employment with the Company so that the cost of these post-employment medical benefits is fully provided by the time the employee retires.
            The IAS 19 liability is calculated by an independent actuary by quantifying the margins implicitly contained in the premium paid to CLICO by the Company. This margin is translated into a per-capita cost of medical benefits for 2004/2005 in respect of retirees currently covered by the plan. The data from CLICO for retirees currently covered by the post employment medical plan together with the data used to calculate the IAS 19 pension plan assets figures are then used to estimate the future post employment medical benefit obligation.

      (iii)Short
        term employee benefits
            The Company recognises the expected cost of vacation earned not yet taken by its employees as an expense.

      f)Available for sale investment
            This represents the Companys share of the accumulated capital cost and working capital prepayment with the International Telecommunications Satellite (INTELSAT) Organisation.
            This asset was disposed during the financial year 2004/2005 and all gains and losses arising from the sale, including revaluations previously recorded in the capital reserve have been recognized in the Statement of Income.
|----------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|2.Statement
        of accounting policies(continued) |  | g)Taxation
            The liability approach for accounting for corporation taxes is used whereby under this method, deferred taxes are provided for the expected future tax consequences of temporary differences between the carrying amounts and tax bases of assets and liabilities using current corporation tax rates.
            Deferred tax liabilities are recognised for temporary differences that will result in taxable amounts in future years. Deferred tax assets are recognised for temporary differences that will result in deductible amounts in future years.

      h)Provisions
            Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past transaction or event and it is possible that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

      i)Leases
            Leases where the lessor effectively retains substantially all the risk and benefits of the ownership of the leased term are classified as operating leases. Operating lease payments are recognised as an expense in the statement of income on a straight line basis over the lease term.
            The Company has no finance leases.

      j)Trade
        and other receivables
            Trade receivables, excluding government balances which generally have 30-90 days terms are recognised and carried at the original billed amounts less allowances for any uncollectible amounts. An estimate for doubtful debts is made when collection of the full amount is no longer probable.
            Receivables from related parties are recognised and carried at cost.

      k)Trade
        and other payables
            Liabilities for trade and other accounts payable which are normally settled on 30-90 day terms are carried at cost which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the Company.

      l)Inventories
            Inventories held for use in the maintenance and expansion of the Companys telecommunications systems are stated at landed cost, less provision for deterioration and obsolescence. Inventory held for resale are stated at the lower of cost and net realisable value, determined on the weighted average basis.
|----------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|2.Statement
        of accounting policies(continued) |  | m)Cash
        and cash equivalents
            Cash and cash equivalents are short-term highly liquid investments with an original maturity of three months or less, that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

      n)Revenue
        recognition
            Operating revenue represents amounts, excluding general consumption tax billed, for the provision of domestic and international telecommunications services. In accordance with normal practice in the telecommunications industry, estimates are included to provide for that portion of revenue which carriers have not yet reported.
            Telephone service revenues are recorded based on call units and minutes of traffic respectively, plus basic fees on a monthly billing cycle basis.
            Prepaid mobile airtime is recognised based upon usage of prepaid cards by customers. Revenue relating to unused card balances, as well as cards sold but not activated on the prepaid platform, is deferred to the following accounting period.
            Post Paid mobile service revenue is recorded based on monthly package rental fees plus additional revenue for any usage in excess of allocated package minutes, on a monthly billing cycle. Revenue associated with unused package minutes is deferred to the following billing cycle.
            Internet Revenue is recognised based on monthly package rental fees plus additional revenue for usage in excess of the package minutes.
            Directory advertising  This represents amounts billed to customers in the current year for directory publication in the following year. Revenue is recognised when the directory is published, in equal monthly installments.
            Business services  This represents amounts billed on contracts in progress. On completion of the contracts, the deferred income is offset against the deferred charges related to the contract and the resulting profit/loss is recognised in the statement of income.
            Mobile equipment revenue is recognised upon delivery of equipment to customers.
            Other telecommunication services revenues, including leased circuits are recorded when the services are rendered to customers.

      o)Comparative
        figures
            Certain changes in presentation have been made during the year to the classification of expenses. Comparative figures have been reclassified to conform with current years classification.
|----------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|                                        |  | Unaudited
        Balance at31/03/2004TT$000 |  | Additions/(transfers)TT$000 |   | DisposalsTT$000 |  | Balance
        at31/03/2005TT$000 | 
|--------------------------------------- |  | --------------------------------------------- |  | ---------------------------- | - | ---------------- |  | ----------------------------------- | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|3.Property,
        plant and equipment |  |                                               |  |                              |   |                  |  |                                     | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|At
        cost:                        |  |                                               |  |                              |   |                  |  |                                     | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|Properties                              |  |                                               |  |                              |   |                  |  |                                     | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|Freehold
        properties             |  | 355,394                                       |  | 19,425                       |   |                 |  | 374,819                             | 
|Leasehold
        properties            |  | 126,467                                       |  | 19,527                       |   |                 |  | 145,994                             | 
|                                        |  | 481,861                                       |  | 38,952                       |   |                 |  | 520,813                             | 
|Technical
        assets                |  |                                               |  |                              |   |                  |  |                                     | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|Central
        office equipment        |  | 2,034,507                                     |  | 264,647                      |   | 96               |  | 2,299,058                           | 
|Customer
        installation           |  | 1,160,033                                     |  | 40,462                       |   |                 |  | 1,200,495                           | 
|External
        cable plant            |  | 1,059,115                                     |  | 49,609                       |   | 19,895           |  | 1,088,829                           | 
|Plant
        & machinery               |  | 9,386                                         |  | 1,813                        |   |                 |  | 11,199                              | 
|Towers                                  |  | 64,426                                        |  |                             |   |                 |  | 64,426                              | 
|Underground
        conduit             |  | 516,640                                       |  | 15,219                       |   |                 |  | 531,859                             | 
|Share
        of Americas 1             |  | 86,455                                        |  | 1,471                        |   |                 |  | 87,926                              | 
|                                        |  | 4,930,562                                     |  | 373,221                      |   | 19,991           |  | 5,283,792                           | 
|Other                                   |  |                                               |  |                              |   |                  |  |                                     | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|Furniture
        & fittings            |  | 49,004                                        |  | 2,322                        |   |                 |  | 51,326                              | 
|Indefeasible
        Rights of Use      |  | 26,431                                        |  |                             |   |                 |  | 26,431                              | 
|Air
        conditioning                |  | 15,934                                        |  | 138                          |   |                 |  | 16,072                              | 
|Tools
        & implements              |  | 30,998                                        |  | 1,860                        |   |                 |  | 32,858                              | 
|Vehicles                                |  | 102,505                                       |  | 1,368                        |   | 7,923            |  | 95,950                              | 
|Computer
        equipment              |  | 399,902                                       |  | 27,581                       |   | 3,851            |  | 423,632                             | 
|Plant
        under construction        |  | 518,237                                       |  | (39,480                      | ) |                 |  | 478,757                             | 
|                                        |  | 1,143,011                                     |  | (6,211                       | ) | 11,774           |  | 1,125,026                           | 
|                                        |  |                                               |  |                              |   |                  |  |                                     | 
|Total
        cost                      |  | 6,555,434                                     |  | 405,962                      |   | 31,765           |  | 6,929,631                           | 





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|                                                   |  | UnauditedBalance at31/03/2004TT$000 |  | DepreciationchargesTT$000 |  | DisposalsTT$000 |  | Balance at31/03/2005TT$000 | 
|-------------------------------------------------- |  | ------------------------------------ |  | -------------------------- |  | ---------------- |  | --------------------------- | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|3.Property,
        plant and equipment(continued) |  |                                      |  |                            |  |                  |  |                             | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|Accumulated depreciation:                          |  |                                      |  |                            |  |                  |  |                             | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|Properties                                         |  |                                      |  |                            |  |                  |  |                             | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|Freehold properties                                |  | 65,807                               |  | 6,632                      |  |                 |  | 72,439                      | 
|Leasehold properties                               |  | 23,980                               |  | 1,917                      |  |                 |  | 25,897                      | 
|                                                   |  | 89,787                               |  | 8,549                      |  |                 |  | 98,336                      | 
|Technical assets                                   |  |                                      |  |                            |  |                  |  |                             | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|Central office equipment                           |  | 1,073,128                            |  | 268,852                    |  | 96               |  | 1,341,884                   | 
|Customer installation                              |  | 966,748                              |  | 48,584                     |  |                 |  | 1,015,332                   | 
|External cable plant                               |  | 646,663                              |  | 81,457                     |  | 19,895           |  | 708,225                     | 
|Plant & machinery                                  |  | 8,337                                |  | 424                        |  |                 |  | 8,761                       | 
|Towers                                             |  | 35,181                               |  | 1,633                      |  |                 |  | 36,814                      | 
|Underground conduit                                |  | 198,899                              |  | 13,308                     |  |                 |  | 212,207                     | 
|Share of Americas 1                                |  | 45,453                               |  | 5,814                      |  |                 |  | 51,267                      | 
|                                                   |  | 2,974,409                            |  | 420,072                    |  | 19,991           |  | 3,374,490                   | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|Other                                              |  |                                      |  |                            |  |                  |  |                             | 
|                                                   |  |                                      |  |                            |  |                  |  |                             | 
|Furniture & fittings                               |  | 38,638                               |  | 2,291                      |  |                 |  | 40,929                      | 
|Indefeasible Rights of Use                         |  | 25,369                               |  | 414                        |  |                 |  | 25,783                      | 
|Air conditioning                                   |  | 5,321                                |  | 957                        |  |                 |  | 6,278                       | 
|Tools & implements                                 |  | 17,185                               |  | 1,535                      |  |                 |  | 18,720                      | 
|Vehicles                                           |  | 86,880                               |  | 7,932                      |  | 7,923            |  | 86,889                      | 
|Computer equipment                                 |  | 245,777                              |  | 56,944                     |  | 3851             |  | 298,870                     | 
|                                                   |  | 419,170                              |  | 70,073                     |  | 11,774           |  | 477,469                     | 
|Total accumulated depreciation                     |  | 3,483,366                            |  | 498,694                    |  | 31,765           |  | 3,950,295                   | 
|Net carrying amount                                |  | 3,072,068                            |  |                            |  |                  |  | 2,979,336                   | 





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|4. | Pension & other post employment benefits |  | (a) | Amounts recognised in
        the balance sheet       |  | Pension plans |   | Post employmentmedical benefit |  
|-- | ---------------------------------------- |  | --- | ----------------------------------------------------- |  | ------------- | - | ------------------------------ | -
|   |                                          |  |     |                                                       |  | 2005TT$000   |   | Unaudited2004TT$000           |  
|   |                                          |  |     |                                                       |  |               |   |                                |  
|   |                                          |  |     | Benefits obligations                                  |  | (2,081,600    | ) | (1,843,700                     | )
|   |                                          |  |     | Plans assets                                          |  | 3,025,400     |   | 2,626,500                      |  
|   |                                          |  |     |                                                       |  | 943,800       |   | 782,800                        |  
|   |                                          |  |     | Unrecognised actuarial (gain)/losses                  |  | (341,400      | ) | (320,800                       | )
|   |                                          |  |     | Un-utilisable asset                                   |  | (186,600      | ) | (157,600                       | )
|   |                                          |  |     | Benefits asset/(liability)                            |  | 415,800       |   | 304,400                        |  
|   |                                          |  |     |                                                       |  |               |   |                                |  
|   |                                          |  | (b) | Amounts recognised in
        the statement of income |  |               |   |                                |  
|   |                                          |  |     | Current service cost                                  |  | 68,000        |   | 44,900                         |  
|   |                                          |  |     | Interest costs                                        |  | 119,500       |   | 106,200                        |  
|   |                                          |  |     | Expected return on plans assets                       |  | (210,200      | ) | (196,100                       | )
|   |                                          |  |     | Curtailment and settlements                           |  | (80,900       | ) | (3,600                         | )
|   |                                          |  |     | Termination Cost                                      |  | 17,300        |   |                               |  
|   |                                          |  |     | Net amortised gain                                    |  | (3,900        | ) | (3,500                         | )
|   |                                          |  |     | Un-utilisable asset adjustment                        |  | 29,000        |   | 18,700                         |  
|   |                                          |  |     | Net benefit (income)/cost                             |  | (61,200       | ) | (33,400                        | )
|   |                                          |  |     | Actual return on plans assets                         |  | 379,600       |   | 663,900                        |  
|   |                                          |  |     |                                                       |  |               |   |                                |  





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|   |                                                     |  |     |                                                                   |  | Pension plans |  | Post employment medicalbenefit | 
|-- | --------------------------------------------------- |  | --- | ----------------------------------------------------------------- |  | ------------- |  | ------------------------------ | 
|4. | Pension & other post employment benefits(continued) |  | (c) | Movement on the asset/(liability) recognised in the balance sheet |  | 2005TT$000   |  | Unaudited2004TT$000           | 
|   |                                                     |  |     |                                                                   |  |               |  |                                | 
|   |                                                     |  |     | At the beginning of the year                                      |  | 304,400       |  | 247,400                        | 
|   |                                                     |  |     | Net benefit income/(cost)                                         |  | 61,200        |  | 33,400                         | 
|   |                                                     |  |     | Contributions                                                     |  | 50,200        |  | 23,600                         | 
|   |                                                     |  |     | At the end of the year                                            |  | 415,800       |  | 304,400                        | 



| |  |  | (d) | Principal
        actuarial assumptions used for accounting purposes were:                                                                                                                                                                                                                                                                                                                                                            
| |  |  | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |  |     |                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |  |  |     |                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |  |  |     |                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |  |  |     | Discount rate                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  |  |     | Expected rate of return on plan assets                                                                                                                                                                                                                                                                                                                                                                                                
| |  |  |     | Future salary increases                                                                                                                                                                                                                                                                                                                                                                                                               
| |  |  |     | Future pension increases                                                                                                                                                                                                                                                                                                                                                                                                              
| |  |  |     | Medical expense increases                                                                                                                                                                                                                                                                                                                                                                                                             
| |  |  |     |                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |  |  | (e) | As a consequence of the High Court Action  LOPEZ vs. TSTT and RBTT Trust Co. Ltd., in 2001/2002 it was determined that the unallocated surplus of the Textel Pension Plan could not be transferred to TSTTs pension plan. The amount of the surplus recognised in respect of the Textel Plan was accordingly limited under IAS 19 giving rise to the un-utilisable asset adjustment of TT$ 29M in 2005 (2004:TT$ 18.7M  unaudited).





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005

|   |          |  |     |                                                                                                    |  | 2005TT$000 |   | Unaudited2004TT$000 |                     
|-- | -------- |  | --- | -------------------------------------------------------------------------------------------------- |  | ----------- | - | -------------------- | --------------------
|5. | Taxation |  | (a) | Components
        of the tax expense                                                              |  |             |   |                      |                     
|   |          |  |     | Deferred
        tax                                                                               |  | 48,450      |   |                      | 38,749              
|   |          |  |     | Current
        tax  current year tax expense                                                     |  | 70,941      |   |                      | 154,758             
|   |          |  |     | 
        prior year tax (income)/expense                                                          |  | (2,047      | ) |                      | 1,372               
|   |          |  |     |                                                                                                    |  | 117,344     |   |                      | 194,879             
|   |          |  |     |                                                                                                    |  |             |   |                      |                     
|   |          |  | (b) | Reconciliation
        of accounting to tax profit:                                                |  | 2005TT$000 |   | Unaudited2004TT$000 |                     
|   |          |  |     | Profit
        before taxation                                                                     |  | 411,173     |   |                      | 644,441             
|   |          |  |     | Tax
        at 30%                                                                                 |  | 123,352     |   |                      | 193,332             
|   |          |  |     | Tax
        effect of income/allowances treated differently in determining taxable
        profits |  | (3,410      | ) |                      | (2,043              
|   |          |  |     | Green
        fund levy                                                                            |  | 2,507       |   |                      | 2,218               
|   |          |  |     | Other                                                                                              |  | (3,058      | ) |                      |                    
|   |          |  |     | Prior
        years(over)/under provision- current tax                                            |  | (2,047      | ) |                      | 1,372               
|   |          |  |     |                                                                                                    |  | 117,344     |   |                      | 194,879             
|   |          |  |     |                                                                                                    |  |             |   |                      |                     
|   |          |  | (c) | Components
        of deferred tax asset                                                           |  | 2005TT$000 |   | Unaudited2004TT$000 |                     
|   |          |  |     | Interest
        payable                                                                           |  | 2,273       |   |                      |                    
|   |          |  |     | Post
        employment medical benefit                                                            |  | 8,908       |   |                      | 7,612               
|   |          |  |     |                                                                                                    |  | 11,181      |   |                      | 7,612               
|   |          |  |     |                                                                                                    |  |             |   |                      |                     
|   |          |  | (d) | Components
        of deferred tax liability                                                       |  | 2005TT$000 |   |                      | Unaudited2004TT$000
|   |          |  |     | Property,
        plant and equipment                                                              |  | (94,554     | ) |                      | (75,955             
|   |          |  |     | Defined
        benefit plans asset                                                                |  | (124,740    | ) |                      | (91,320             
|   |          |  |     |                                                                                                    |  | (219,294    | ) |                      | (167,275            





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|6. | Construction
        work - 
        in - progress |  | This
        represents the excess of the costs incurred over progress billings to
        date on a communication solution to enhance the functioning and delivery
        of electronic services for a third party. Completion testing had not yet
        been completed as at 31stMarch 2005 hence no revenue has been recognised to date.
|-- | -------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|   |                                             |                                        |                                         |         | 2005TT$000 |   |         | Unaudited2004TT$000 |   | 
|-- | ------------------------------------------- | -------------------------------------- | --------------------------------------- | ------- | ----------- | - | ------- | -------------------- | - | 
|7. | Inventories                                 |                                        | Cable                                   |         | 16,415      |   |         | 20,560               |   | 
|   |                                             |                                        | Mobile                                  |         | 101,742     |   |         | 63,137               |   | 
|   |                                             |                                        | Business
        systems                |         | 17,037      |   |         | 16,550               |   | 
|   |                                             |                                        | Materials
        and supplies          |         | 51,530      |   |         | 48,865               |   | 
|   |                                             |                                        | Provision
        for obsolescence      |         | (28,032     | ) |         | (17,100              | ) | 
|   |                                             |                                        |                                         |         | 158,692     |   |         | 132,012              |   | 
|   |                                             |                                        |                                         |         |             |   |         |                      |   | 
|   |                                             |                                        |                                         |         | 2005TT$000 |   |         | Unaudited2004TT$000 |   | 
|8. | Accounts                                    |                                        | Foreign
        telecom administrations |         | 41,456      |   |         | 47,960               |   | 
|   | receivable
        and 
        prepayments |                                        | Amounts
        due from customers      |         | 499,068     |   |         | 454,870              |   | 
|   |                                             | Sundry
        debtors and prepayments |                                         | 183,268 |             |   | 131,450 |                      |  
|   |                                             |                                        | Provision
        for doubtful debts    |         | (265,884    | ) |         | (210,851             | ) | 
|   |                                             |                                        |                                         |         | 457,908     |   |         | 423,429              |   | 
|   |                                             |                                        |                                         |         |             |   |         |                      |   | 
|   |                                             |                                        |                                         |         | 2005TT$000 |   |         | Unaudited2004TT$000 |   | 
|9. | Cash
        and cash 
        equivalents  |                                        | Cash
        at bank and in hand        |         | 268,138     |   |         | 171,700              |   | 



| |  |  | The Company has unsecured bank overdraft facilities up to a maximum of TT$50 million
| |  |  | ------------------------------------------------------------------------------------





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|    |                |  |  |                                               |  | 2005TT$000 |  |  | Unaudited2004TT$000 |  | 
|--- | -------------- |  |  | --------------------------------------------- |  | ----------- |  |  | -------------------- |  | 
|10. | Stated capital |  |  | Authorised                                    |  |             |  |  |                      |  | 
|    |                |  |  | 1,300,000,000 ordinary shares of no par value |  |             |  |  |                      |  | 
|    |                |  |  |                                               |  |             |  |  |                      |  | 
|    |                |  |  | Issued                                        |  |             |  |  |                      |  | 
|    |                |  |  | 282,820,361 ordinary shares of no par value   |  | 572,717     |  |  | 572,717              |  | 



|    |            |  |     |                                                                          |  | 2005TT$000 |   |  | Unaudited2004TT$000 |   | 
|--- | ---------- |  | --- | ------------------------------------------------------------------------ |  | ----------- | - |  | -------------------- | - | 
|11. | Borrowings |  | (a) | Long term loans                                                          |  |             |   |  |                      |   | 
|    |            |  |     | Balance brought forward                                                  |  | 464,089     |   |  | 563,230              |   | 
|    |            |  |     | Drawdowns                                                                |  | 40,000      |   |  |                     |   | 
|    |            |  |     | Foreign exchange loss arising from currency translations during the year |  | 4           |   |  | 138                  |   | 
|    |            |  |     |                                                                          |  | 504,093     |   |  | 563,368              |   | 
|    |            |  |     | Repayments                                                               |  | (99,345     | ) |  | (99,279              | ) | 
|    |            |  |     | Balance carried forward                                                  |  | 404,748     |   |  | 464,089              |   | 
|    |            |  |     | Amounts due within one year                                              |  | 106,418     |   |  | 99,310               |   | 
|    |            |  |     | Amounts due within 2 to 5 years                                          |  | 298,330     |   |  | 344,227              |   | 
|    |            |  |     | Amounts due after 5 years                                                |  |            |   |  | 20,552               |   | 
|    |            |  |     |                                                                          |  | 404,748     |   |  | 464,089              |   | 

| |  |  | (b) | Interest rates                                                                                                                                                                                                                                                                                                                   |  |  |                       |   | 
| |  |  | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | --------------------- | - | 
| |  |  |     | The Republic Bank Limited loan is tied to the average of the Trinidad and Tobago dollar prime rates of Republic Bank Limited, RBTT, and Scotiabank Limited at 30th November each year minus 4.40%. The loans from Royal Bank, Export Import Bank of the United States and Export Development Corporation are all at fixed rates.
| |  |  |     | Floating interest rates                                                                                                                                                                                                                                                                                                          |  |  | 5.10                  | %
| |  |  |     | Fixed interest rates                                                                                                                                                                                                                                                                                                             |  |  | 4.72%
        - 11.45 | %

| |  |  | (c) | Long term loan facilities        |  |             |  |  |                      | 
| |  |  | --- | -------------------------------- |  | ----------- |  |  | -------------------- | 
| |  |  |     |                                  |  | 2005TT$000 |  |  | Unaudited2004TT$000 | 
| |  |  |     | -      at
        fixed rates    |  | 290,248     |  |  | 321,089              | 
| |  |  |     | -      at
        floating rates |  | 114,500     |  |  | 143,000              | 
| |  |  |     |                                  |  | 404,748     |  |  | 464,089              | 





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NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|11. | Borrowings(continued) |  | (d) | Security                                                                                                                                                                                     
|--- | --------------------- |  | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                       |  |     | These long-term loans are held with various local and foreign financial institutions and are unsecured.                                                                                      
|    |                       |  | (e) | Repayments                                                                                                                                                                                   
|    |                       |  |     | The Companys loans are being repaid within varying periods ranging between January 2006 and October 2009.                                                                                   
|    |                       |  | (f) | Fair value of fixed rate loans                                                                                                                                                               
|    |                       |  |     | The fair value of the fixed rate long-term loan is based on estimated future cash flows discounted using the current market rates for debt of the same remaining maturities and credit risks.



| |  |  |  |                               |  | Carrying
        amounts |  | Fair
        values  | 
| |  |  |  | ----------------------------- |  | ------------------------ |  | -------------------- | 
| |  |  |  |                               |  | 2005TT$000              |  | Unaudited2004TT$000 | 
| |  |  |  |                               |  |                          |  |                      | 
| |  |  |  | Balance
        at 31st March |  | 290,248                  |  | 321,089              | 



|    |                           |  |     |                                                                                                                                                             |  | 2005TT$000 |  | Unaudited2004TT$000 |        
|--- | ------------------------- |  | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------- |  | -------------------- | -------
|12. | Employee
        benefits |  |     |                                                                                                                                                             |  |             |  |                      |        
|    |                           |  | (a) | Liabilities
        arising from Human Resources including accrued vacation leave and provisions
        for retroactive salaries and termination benefits. |  |             |  |                      |        
|    |                           |  |     |                                                                                                                                                             |  | 325,408     |  |                      | 150,073





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|    |                                    |  |                                                                                                                                                     |  | 2005TT$000 |   | Unaudited2004TT$000 |        
|--- | ---------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------- | - | -------------------- | -------
|13. | Accounts
        payable           |  | Foreign
        telecom administrations                                                                                                             |  | 13,637      |   | 4,534                |        
|    | and
        accruals               |  | Cable
        and Wireless (West Indies) Limited                                                                                                    |  | 5,239       |   | 2,577                |        
|    |                                    |  | Trade
        payable                                                                                                                               |  | 223,429     |   | 307,005              |        
|    |                                    |  | Other
        payables                                                                                                                              |  | 108,819     |   |                      | 85,792 
|    |                                    |  |                                                                                                                                                     |  | 351,124     |   |                      | 399,908
|    |                                    |  |                                                                                                                                                     |  |             |   |                      |        
|14. | Deferred
        revenue           |  |                                                                                                                                                     |  | 2005TT$000 |   | Unaudited2004TT$000 |        
|    |                                    |  | Mobile                                                                                                                                              |  | 68,138      |   | 19,939               |        
|    |                                    |  | Directory                                                                                                                                           |  | 14,300      |   | 13,614               |        
|    |                                    |  | Business
        services                                                                                                                           |  | 3,087       |   |                      | 3,858  
|    |                                    |  |                                                                                                                                                     |  | 85,525      |   |                      | 37,411 
|    |                                    |  |                                                                                                                                                     |  |             |   |                      |        
|15. | Cost
        of sales              |  |                                                                                                                                                     |  | 2005TT$000 |   | Unaudited2004TT$000 |        
|    |                                    |  | Out-payments                                                                                                                                        |  | 60,927      |   | 61,759               |        
|    |                                    |  | Equipment
        usage                                                                                                                             |  | 214,235     |   | 198,307              |        
|    |                                    |  | Commissions                                                                                                                                         |  | 49,848      |   |                      | 19,887 
|    |                                    |  |                                                                                                                                                     |  | 325,010     |   |                      | 279,953
|    |                                    |  |                                                                                                                                                     |  |             |   |                      |        
|16. | Operating
        expenses - Other |  | Other
        operating expenses in the main include advertising, bad debt provisions,
        contract services and supplies and related expenses. | 
|    |                                    |  |                                                                                                                                                     |  |             |   |                      |        
|17. | Profit
        before taxation     |  |                                                                                                                                                     |  | 2005TT$000 |   | Unaudited2004TT$000 |        
|    |                                    |  | This
        is arrived at after charging the following items:                                                                                      |  |             |   |                      |        
|    |                                    |  |                                                                                                                                                     |  |             |   |                      |        
|    |                                    |  | Exchange
        (gain)/loss                                                                                                                        |  | (572        | ) | 1,458                |        
|    |                                    |  | Provision
        for doubtful debts                                                                                                                |  | 83,379      |   | 60,095               |        
|    |                                    |  | Stock
        write-off/provision for obsolescence                                                                                                  |  | 10,931      |   | 2,576                |        





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|18. | Related
        party transactions |  |     | The
        transactions with the Companys related party Cable & Wireless
        (West Indies) Limited are as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 
|--- | ---------------------------------- |  | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|    |                                    |  |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 
|    |                                    |  |     | Technical
        and professional fees and purchases                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|    |                                    |  |     | Traffic
        settlements (net)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 
|    |                                    |  |     | Directors
        fees and allowances                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 
|19. | Financial
        instruments      |  |     | Exposure
        to various types of financial risks arises in the ordinary course of the
        companys business. Derivatives financial instruments are not currently
        used to reduce exposure to fluctuations in interest and foreign exchange
        rates.
      Financial
        instruments carried on the balance sheet include cash and cash equivalents,
        accounts receivables and prepayments, investments, accounts payable and
        accruals and borrowings. Transactions in financial instruments have resulted
        in the Company assuming the financial risks described below:                                                                                                                                                                                                                                                          
|    |                                    |  | (a) | Interest
        rate risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|    |                                    |  |     | The
        changes in market interest rates on the Companys loans cause exposure
        to interest rate risk. Included in note 11 is information on the maturity
        dates as well as effective interest rates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                    |  | (b) | Credit
        risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 
|    |                                    |  |     | Credit
        risk is the risk that one party to a financial instrument will fail to
        discharge an obligation and cause the other party to incur a financial
        loss. For certain customers the company requires cash deposits in respect
        of financial assets, materially trade receivables. The cash deposits generally
        cover significant credit risk related to such customers.
      Additionally,
        appropriate credit procedures are in place to minimize exposure to credit
        risk generally. These include credit evaluations on all new customers
        and comprehensive procedures for the disconnection of services to, and
        recovery of amounts owed by, defaulting customers. Cash and cash equivalents
        are placed with substantial institutions who are believed to have minimal
        risk of default.





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|19. | Financial instruments |  | (c) | Fair value                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |  |  |  | 
|--- | --------------------- |  | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  | 
|    | (continued)           |  |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |  |  |  | 
|    |                       |  |     | Fair value amounts represent estimates of the arms-length consideration that would be currently agreed between knowledgeable, willing parties who are under no compulsion to act and is best evidenced by a quoted market price, if one exists. Where such instruments exist, they are valued using present value or other valuation techniques and the fair value shown may not necessarily be indicative of the amounts realisable in an immediate settlement of the instruments.
            The carrying amounts of the Companys cash and cash equivalents, short term borrowings, accounts receivable, medium term receivable and accounts payable approximate to their fair value because of the short term maturities of these instruments. Amounts due to/from related companies are considered to approximate their carrying value as they represent an ability to effect set-offs in future in the amounts disclosed. Long-term assets, except for trade investments, are carried at their contracted settlement value. The estimated fair value for trade investments has been determined using available market information and appropriate valuation methodologies applied consistently.
            Additionally, the cost of all monetary assets and liabilities has been appropriately adjusted to reflect estimated losses on realization or discounts on settlements.
            The fair value of the Companys floating rate long-term loans approximates its carrying amount given the floating rate nature of the loan at prevailing market rates. The fair value of the fixed rates long-term loans is based on estimated future cash flows discounted using the current market rates of debt of the same remaining maturities and credit risk (note 11f). | 





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|19. | Financial instruments(continued) |  | (d) | Foreign Currency Risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | -------------------------------- |  | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                  |  |     | Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in the market exchange rate for the currency.
            The company incurs foreign currency risk primarily on purchases and borrowings that are denominated in a currency other than the Trinidad and Tobago dollar. The companys exposure is denominated in Special Drawing Rights (SDR), Gold Francs (GFC), Barbados dollar (BDOS), US dollar (USD) and Pound Sterling (GBP).
            The table below shows the companys foreign currency exposure, at balance sheet date:
            Net foreign currency monetary assets / (liabilities)



| |  |  |  |                            |  | SDR000 |  | GFC000 |  | BDOS000 |  | USD000  |  | GBP000
| |  |  |  | -------------------------- |  | ------- |  | ------- |  | -------- |  | -------- |  | -------
| |  |  |  | March 31, 2005             |  | 105     |  | (465)   |  | (672)    |  | (69,430) |  | (578)  
| |  |  |  |                            |  |         |  |         |  |          |  |          |  |        
| |  |  |  | March 31, 2004 (Unaudited) |  | 222     |  | (5)     |  | (639)    |  | (94,653) |  | (178)  
| |  |  |  |                            |  |         |  |         |  |          |  |          |  |        



| |  |  |  | Exchange rates expressed in terms of TT$ (SDR to USD) were as follows:
| |  |  |  | ----------------------------------------------------------------------



| |  |  |  |                               |  | SDR   |  | GFC    |  | BDOS   |  | USD    |  | GBP    
| |  |  |  | ----------------------------- |  | ----- |  | ------ |  | ------ |  | ------ |  | -------
| |  |  |  | At March 31, 2005             |  | 1.528 |  | 3.1036 |  | 3.1954 |  | 6.2999 |  | 11.9377
| |  |  |  |                               |  |       |  |        |  |        |  |        |  |        
| |  |  |  | At March 31, 2004 (Unaudited) |  | 1.495 |  | 3.0225 |  | 3.1193 |  | 6.2998 |  | 11.6149



| |  |  | (e) | Market risk
            Market risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices whether those changes are caused by factors specific to the individual security or its issuer or factors affecting all securities traded in the market.
            The companys significant exposure to market risk relates to the holding of available-for-sale trade investments are reflected in the special purpose financial statements at fair value.
| |  |  | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|19. | Financial instruments(continued) |  | (f) | Liquidity risk                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | -------------------------------- |  | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                  |  |     | Liquidity risk, also referred to as funding risk, is the risk that the company will encounter difficulty in raising funds to meet commitments associated with financial instruments. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, and the availability of funding through an adequate amount of committed credit facilities.
            Due to the dynamic nature of the underlying business, the management of the company, aims at maintaining flexibility in the funding by keeping lines of credit  available as well as by acquiring and maintaining prudential cash resources in appropriate currencies required to settle commitments.
|20. | Commitments and contingencies    |  | (a) | Capital expenditure commitments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                  |  |     | At 31st March 2005 the Company has commitments of TT$555.1 million (2004: TT$103 million unaudited) for the acquisition of property, plant and equipment incidental to the ordinary course of business.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                  |  | (b) | Operating lease commitments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                  |  |     | Operating lease expense was TT$42.2 million and TT$58.9 million (unaudited) for the years ended 31st March 2005 and 2004 respectively.
            Future minimum rentals under non-cancelable leases of motor vehicles and leasehold buildings are as follows as of 31st March:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            



| |  |  |  |                                             |  |  |  | 2005TT$000 |  |  |  |  |  |  | Unaudited2004TT$000 | 
| |  |  |  | ------------------------------------------- |  |  |  | ----------- |  |  |  |  |  |  | -------------------- | 
| |  |  |  | Within one year                             |  |  |  | 8,631       |  |  |  |  |  |  | 10,604               | 
| |  |  |  | After one year but not more than five years |  |  |  | 23,573      |  |  |  |  |  |  | 31,694               | 
| |  |  |  | More than five years                        |  |  |  | 9,000       |  |  |  |  |  |  | 16,585               | 
| |  |  |  | Total                                       |  |  |  | 41,204      |  |  |  |  |  |  | 58,883               | 



| |  |  |     |                       
| |  |  | --- | ----------------------
| |  |  | (c) | Contingent liabilities



| |  |  |  | The Company has guarantee facilities for contract performance and customs clearance certificates with its bankers amounting to TT $15.5 million.
| |  |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|21. | Dividends paid |  |  | 
|--- | -------------- |  |  | 



| |  |  |  |                                                        |  | 2005TT$000 |  |  |  |  |  | Unaudited2004TT$000 | 
| |  |  |  | ------------------------------------------------------ |  | ----------- |  |  |  |  |  | -------------------- | 
| |  |  |  | Dividend on ordinary shares:                           |  |             |  |  |  |  |  |                      | 
| |  |  |  | Interim dividend for 2004/05 of $0.23 (2003/04: $0.35) |  | 65,217      |  |  |  |  |  | 98,462               | 
| |  |  |  | Final dividend for 2003/04 of $0.43 (2002/03: $031)    |  | 122,320     |  |  |  |  |  | 133,741              | 
| |  |  |  |                                                        |  | 187,537     |  |  |  |  |  | 232,203              | 



|22. | Subsequent events   |  |    | In April 2005 the company obtained a loan facility amounting to TT$1billion to facilitate the upgrade of the wireless network. The loan was be effected via the issue of a 10 year TT$ denominated bond with a fixed coupon rate of 6.225%. The loan was secured by a mortgage bill of sale over the specific assets being procured from the loan.                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ------------------- |  | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                     |  |    | In March 2005 the Board of directors agreed to increase the minimum pension payable to TT$1,150 per month effective April 1st2005. This decision was communicated to the employee base on April 22nd, 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|23. | US GAAP Information |  |     | Differences between International Financial Reporting Standards and United States Generally Accepted Accounting Principles
            The financial statements of the Telecommunications Services of Trinidad and Tobago Limited (TSTT) have been prepared in accordance with International Financial Reporting Standards (IFRS), which differ in certain material respects from accounting principles generally accepted in the United States (US GAAP). Application of US GAAP would have affected the balance sheet as at March 31, 2005 and net income of year then ended. A qualitative description of material differences between IFRS and US GAAP as they relate to the Company are discussed in further detail below.
|    |                     |  | (a) | Revenue recognition
            Revenue from telecommunications services mainly represents fixed line telephone, mobile, leased circuit and internet. Under IFRS the company recognizes revenue and related costs earned from access, installation and similar fees when the services are provided to the customer and the related costs are incurred.
            In accordance with US GAAP, revenue earned from installation is deferred over the expected period of the customer relationship.                                                                                                                                                                                                                                 





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005

|23.US
        GAAP Information(continued) |  | (b)Borrowing
        costs
            Under IFRS (IAS 24), a company can choose to capitalise borrowing costs where they are directly attributable to the acquisition, construction or production of a qualifying asset. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use or sale.
            The Company has elected not to capitalize borrowing costs in respect of expenditures incurred on qualifying assets.
            US GAAP (FAS 34) requires capitalisation of borrowing costs relating to the accumulated expenditures on qualifying assets including the amortisation of discount premium and issue costs on debt.                                                                          
|----------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                          |  | (c)Impairment
            IAS 36 requires thatan entity should assess annually whether there are any indications that an asset may be impaired. An impairment loss must be recognized in the statement of income when an assets carrying amount exceeds its recoverable amount.  In performing impairment tests under IAS 36 a comparison was made using cash flows expected from TDMA assets and the net book value of assets within TDMA Cash Generating Unit. No impairment was recorded for the year ended March 31, 2005.
            Under FAS 144 there is a requirement to compare the net book value of the assets to the undiscounted cash flows expected from the future use of the said assets. Accordingly, no impairment would be recognized under US GAAP.





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TELECOMMUNICATIONS SERVICES OF TRINIDAD AND TOBAGO LIMITED

NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST MARCH, 2005



|23.US
        GAAP Information(continued) |  | (d)Pensions
        and post retirement benefit obligation
            There are a few differences between IFRS and US GAAP in these areas:

      Under
        IAS 19 pension assets recognised cannot exceed the net total of unrecognised
        past service cost and net actuarial losses plus the present value of cumulative
        benefits available from refunds or reduction of future contributions to
        the plan.
            Under FAS 87, net pension cost is an aggregation of various pension cost components, some of which are expenses or losses (which increase net periodic pension cost) and some of which are revenues or gains (which decrease net periodic pension cost). It is possible for the revenue or gain components to exceed the expense or loss components, resulting in net periodic pension income. A pension asset should be recognized for any plan with plan assets in excess of the projected benefit obligation.
            Under FAS 87 the pension surplus is calculated as being the difference between the contributions made by the company over the net periodic costs.

      FAS
        87 allows prior service costs (i.e. the retroactive cost of benefit improvements)
        to be amortised over a period of years whereas IFRS requires full and
        immediate recognition in the current year to the extent that the benefits
        have already vested.

      FAS
        87 allows market-related asset values (e.g. the use of a smoothed
        market value for equities) but IFRS requires the use of market values
        at the accounting date.
|----------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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