### Exhibit 99.3

 

### **Responsibility for the	Annual Report**

Alcan's	management is responsible for the preparation, integrity and fair	presentation of the financial statements and other information in the Annual	Report. The financial statements have been prepared in accordance with	accounting principles generally accepted in the United States of America and	include, where appropriate, estimates based on the best judgment of	management. A reconciliation with Canadian generally accepted accounting	principles is also presented. Financial and operating data elsewhere in the	Annual Report are consistent with that contained in the accompanying	financial statements.

	 

Alcan's	policy is to maintain systems of internal accounting, administrative and	disclosure controls of high quality consistent with reasonable cost. Such	systems are designed to provide reasonable assurance that the financial	information is accurate and reliable and that Company assets are adequately	accounted for and safeguarded. The Board of Directors oversees the Company's	systems of internal accounting, administrative and disclosure controls	through its Audit Committee, which is comprised of directors who are not	employees. The Audit Committee meets regularly with representatives of the	shareholders' independent auditors and management, including internal audit	staff, to satisfy themselves that Alcan's policy is being followed. In	addition, a Disclosure Committee of management has been established to	manage disclosure of corporate information and oversee the functioning of	the Company's disclosure controls and procedures.

	 

The Audit	Committee has recommended the appointment of PricewaterhouseCoopers LLP as	the independent auditors, subject to approval by the shareholders.

	 

The	financial statements have been reviewed by the Audit Committee and, together	with the other required information in this Annual Report, approved by the	Board of Directors. In addition, the financial statements have been audited	by PricewaterhouseCoopers LLP, whose report is provided on page 2.

	 

((Signature))

Travis Engen, President and Chief Executive Officer	

	 

((Signature))

Michael Hanley, Executive Vice-President and Chief Financial Officer	

March 8, 2006 

	 

**Management's	Report on Internal Control over Financial Reporting**

	 

Management	of Alcan is responsible for establishing and maintaining adequate internal	control over financial reporting (as defined in Rule 15a-15(d) under the	Securities Exchange Act of 1934). Alcan's internal control over financial	reporting is a process designed under the supervision of Alcan's Chief	Executive Officer and Chief Financial Officer to provide reasonable assurance	regarding the reliability of financial reporting and the preparation of the	Company's financial statements for external reporting purposes in accordance	with accounting principles generally accepted in the United States of	America.

	 

As of	December 31, 2005, management conducted an assessment of the effectiveness	of the Company's internal control over financial reporting based on the	criteria established in *Internal Control	-	Integrated Framework*issued by	the Committee of Sponsoring Organizations of the Treadway Commission. 	Based	on this assessment, management concluded that the Company's internal control over financial reporting as of December 31, 2005	was effective.	

	 

Management's	assessment of the effectiveness of the Company's internal control over	financial reporting as of December 31, 2005 has been audited by	PricewaterhouseCoopers LLP, an independent registered public accounting	firm, as stated in their report appearing on page 2.

	 

## OECD Guidelines

	 

The Organization for Economic Cooperation and Development (OECD), which	consists of 30 industrialized countries including Canada, has established	guidelines setting out an acceptable framework of reciprocal rights and	responsibilities between multinational enterprises and host governments.	Alcan supports and complies with the OECD guidelines and has a	*Worldwide Code of Employee and Business Conduct*,	which is consistent with them.

1

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** Independent	Auditors' Report**

	 

To the	Shareholders of Alcan Inc.

	 

We have audited the	accompanying consolidated balance sheets of Alcan Inc. (the Company) as at	December 31, 2005, 2004 and 2003 and the related consolidated statements of	income, shareholders' equity and cash flows for each of the years in the	three-year period ended December 31, 2005. We have also audited the	effectiveness of the Company's internal control over financial reporting as	at December 31, 2005, based on the criteria established in *Internal	Control - Integrated Framework* issued by the Committee of Sponsoring	Organizations of the Treadway Commission (COSO) and management's	assessment thereof, included in the accompanying Management's Report on	Internal Control over Financial Reporting.  The Company's management is	responsible for these financial statements, for maintaining effective	internal control over financial reporting and for its assessment of the	effectiveness of internal control over financial reporting. Our	responsibility is to express an opinion on Alcan's 2005, 2004, and 2003	consolidated financial statements, an opinion on management's assessment as	at December 31, 2005 and an opinion on the effectiveness of the Company's	internal control over financial reporting as at December 31, 2005 based on	our audits.

	 

A company's internal	control over financial reporting is a process designed to provide reasonable	assurance regarding the reliability of financial reporting and the	preparation of financial statements for external purposes in accordance with	generally accepted accounting principles. A company's internal control over	financial reporting includes those policies and procedures that (1) pertain	to the maintenance of records that, in reasonable detail, accurately and	fairly reflect the transactions and dispositions of the assets of the	company; (2) provide reasonable assurance that transactions are recorded as	necessary to permit preparation of financial statements in accordance with	generally accepted accounting principles, and that receipts and expenditures	of the company are being made only in accordance with authorizations of	management and directors of the company; and (3) provide reasonable	assurance regarding prevention or timely detection of unauthorized	acquisition, use, or disposition of the company's assets that could have a	material effect on the financial statements.

	 

We conducted our audits	of the Company's financial statements in accordance with Canadian generally	accepted auditing standards and the standards of the Public Company	Accounting Oversight Board (United States). Those standards require that we	plan and perform an audit to obtain reasonable assurance about whether the	financial statements are free of material misstatement. An audit of	financial statements includes examining, on a test basis, evidence	supporting the amounts and disclosures in the financial statements. A	financial statement audit also includes assessing the accounting principles	used and significant estimates made by management, and evaluating the	overall financial statement presentation. We conducted our audit of the	effectiveness of the Company's internal control over financial reporting and	management's assessment thereof in accordance with the standards of the	Public Company Accounting Oversight Board (United States). Those standards	require that we plan and perform the audit to obtain reasonable assurance	about whether effective internal control over financial reporting was	maintained in all material respects. Our audit included obtaining an	understanding of internal control over financial reporting, evaluating	management's assessment, testing and evaluating the design and operating	effectiveness of internal control and performing such other procedures as we	considered necessary in the circumstances. We believe that our audits	provide a reasonable basis for our opinions.

	 

In our opinion, the	consolidated financial statements referred to above present fairly, in all	material respects, the financial position of the Company as at December 31,	2005, 2004 and 2003 and the results of its operations and its cash flows for	each of the years in the three year period ended December 31, 2005 in	accordance with accounting principles generally accepted in the United	States of America. Also, in our opinion, management's assessment that the	Company maintained effective internal control over financial reporting as of	December 31, 2005, is fairly stated, in all material respects, based on	criteria established in Internal Control *-* Integrated Framework	issued by the COSO.  Furthermore,	in our opinion, the Company maintained, in all material respects, effective	internal control over financial reporting as at December 31, 2005 based on	criteria established in Internal Control *-*	Integrated Framework issued by the COSO.

	 

Because of its inherent	limitations, internal control over financial reporting may not prevent or	detect misstatements. Also, projections of any evaluation of effectiveness	to future periods are subject to the risk that controls may become	inadequate because of changes in conditions, or that the degree of	compliance with the policies or procedures may deteriorate.

	 

((Signature))

....................................................

PricewaterhouseCoopers LLP

Chartered	Accountants

Montreal,	Quebec

March 8,	2006

2

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**Independent	Auditors' Report**	(cont'd)

**Comments by	Auditor for U.S. Readers on Canada-U.S. Reporting Differences**

In the United States, reporting standards for auditors require the addition	of an explanatory paragraph (following the opinion paragraph) when there is	a change in accounting principles that has a material effect on the	comparability of the company's financial statements, such as the changes	described in Note 4 to the financial statements. Our report to the	shareholders dated March 8, 2006, is expressed in accordance with Canadian	reporting standards which do not require a reference to such a change in	accounting principles in the auditors' report when the change is properly	accounted for and adequately disclosed in the financial statements.	

((Signature))

PricewaterhouseCoopers LLP

Chartered	Accountants

Montreal,	Quebec

	 

March 8,	2006

****3

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**Alcan Inc. **

**CONSOLIDATED STATEMENT OF INCOME**

Year ended December 31

(in millions of US$, except per share amounts)

	 
| ** **
**2005**
2004
2003
**Sales and operating revenues**
**20,320**
24,948
13,850
** **
** **
			 
			 
**Costs and expenses**
** **
			 
			 
Cost of sales and operating expenses, excluding depreciation and
** **
			 
			 
amortization noted below
**16,135**
20,270
11,171
Depreciation and			amortization (NOTE			9)
**1,080**
1,337
862
Selling,			administrative and general expenses
**1,402**
1,615
758
Research and			development expenses
**227**
239
190
Interest
**350**
346
212
Restructuring charges -			net (NOTE 10)
**685**
87
26
Goodwill impairment (NOTE 9)
**122**
154
28
Other expenses (income) -			net (NOTE 16)
**(4)**
321
105
			 
**19,997**
24,369
13,352
Income from			continuing operations before income taxes and 
** **
			 
			 
other items
**323**
579
498
Income taxes (NOTE 11)
**257**
375
258
Income from			continuing operations before other items
**66**
204
240
Equity income (NOTE 12)
**88**
54
38
Minority			interests
**1**
(15)
(16)
Income from			continuing operations
**155**
243
262
Income (Loss) from			discontinued operations (NOTE 5)
**(26)**
15
(159)
Income before			cumulative effect of accounting change
**129**
258
103
Cumulative effect			of accounting change, net of income
** **
			 
			 
taxes of nil (nil in 2004			and $17 in 2003) 			(NOTE 4)
**-**
-
(39)
**Net income**
**129**
258
64
Dividends on			preference shares
**7**
6
7
**Net income			attributable to common shareholders**
**122**
252
57
**Earnings			(Loss) per share**(NOTE 6)
** **
			 
			 
Basic and Diluted
** **
			 
			 
Income from			continuing operations 
**0.40**
0.64
0.79
Income (Loss)			from discontinued operations
**(0.07)**
0.05
(0.49)
Cumulative effect			of accounting change
**-**
-
(0.12)
**Net income per			common share - basic and diluted**
**0.33**
0.69
0.18
**Dividends per			common share**
**0.60**
0.60
0.60
* The accompanying notes are an integral part of the financial statements.*

4

**Alcan Inc.**

**CONSOLIDATED BALANCE SHEET**

As	at December 31

(in millions of US$, except where indicated)

	 

	 

** **
**2005**
2004
2003
**ASSETS**
			 
			 
			 
**Current assets**
			 
			 
			 
Cash and time deposits
**181**
184
686
Trade receivables			(net of allowances of $56 in 2005, $99 in 2004, and 
** **
			 
			 
$92 in 2003) (NOTES 14 AND 15)
**2,308**
3,247
2,948
Other receivables
**946**
936
686
Deferred income taxes			(NOTE 11)
**150**
214
49
Inventories (NOTE 17)
**2,734**
4,040
3,682
Current assets held for			sale (NOTE 5)
**119**
791
1,063
**Total current assets**
**6,438**
9,412
9,114
Deferred charges and other			assets (NOTE 18)
**1,052**
1,130
755
Investments (NOTE 19)
**1,511**
1,747
808
Deferred income taxes			(NOTE 11)
**863**
870
892
Property, plant and			equipment (NOTE 20)
** **
			 
			 
  Cost (excluding construction work in progress)
**16,990**
21,595
21,727
  Construction work in progress
**1,604**
1,177
972
  Accumulated depreciation			
**(7,561)**
(9,478)
(8,539)
			 
**11,033**
13,294
14,160
Intangible			assets, net of accumulated amortization of $233 in 2005, $172			
** **
			 
			 
 in 2004, and $86 in 2003			(NOTE 9)
**1,013**
1,230
1,160
Goodwill (NOTE 9)
**4,713**
5,496
4,686
Long-term assets held for			sale (NOTE 5)
**15**
162
373
**Total assets**
**26,638**
33,341
31,948
*The accompanying notes are an integral part of the financial statements.*

 5
 
**Alcan Inc.**

**CONSOLIDATED BALANCE SHEET**	(cont'd)

As	at December 31

(in millions of US$, except where indicated)

	 

	 

** **
**2005**
2004
2003
**LIABILITIES AND			SHAREHOLDERS' EQUITY**
			 
			 
			 
**Current liabilities**
			 
			 
			 
Payables and			accrued liabilities
**4,608**
5,843
4,858
Short-term			borrowings 
**348**
2,486
1,764
Debt maturing within one			year (NOTE 24)
**802**
569
341
Deferred income taxes			(NOTE 11)
**25**
23
81
Current liabilities of			operations held for sale (NOTE 5)
**62**
335
547
**Total current			liabilities**
**5,845**
9,256
7,591
Debt not maturing within			one year (NOTES 24			AND 31)
**5,265**
6,345
7,437
Deferred credits and other			liabilities (NOTE			23)
**1,608**
1,521
1,391
Post-retirement benefits			(NOTE 33)
**3,037**
3,465
2,920
Deferred income taxes			(NOTE 11)
**1,172**
1,543
1,696
Long-term liabilities of			operations held for sale (NOTE 5)
**-**
249
233
Minority			interests
**67**
236
403
** **
** **
			 
			 
**Shareholders'			equity**
** **
			 
			 
Redeemable			non-retractable preference shares, issuable in series; unlimited			number of shares authorized (NOTE 25):
** **
			 
			 
Series C: stated			value $106, number of shares authorized 5,700,000;
** **
			 
			 
outstanding			5,699,900 in 2005; 5,700,000 in 2004 and 2003
**106**
106
106
Series E: stated			value $54, number of shares authorized 3,000,000;
** **
			 
			 
outstanding			2,999,000 in 2005; 3,000,000 in 2004 and 2003
**54**
54
54
Common			shareholders' equity
** **
			 
			 
Common shares,			unlimited number of shares authorized, 
** **
			 
			 
outstanding (in			thousands) 371,921 in 2005; 369,930 in 2004; 
** **
			 
			 
365,181 in 2003 (NOTE 26)
**6,181**
6,670
6,461
Additional paid-in capital			(NOTES 8 AND 27)
**683**
112
128
Retained earnings (NOTE 28)
**3,048**
3,362
3,331
Common shares held by a			subsidiary (NOTE			26)
**(31)**
(35)
(56)
Accumulated other			comprehensive income (loss)
**(397)**
457
253
			 
**9,484**
10,566
10,117
			 
**9,644**
10,726
10,277
Commitments and			contingencies (NOTE			29)
** **
			 
			 
**Total liabilities			and shareholders' equity**
**26,638**
33,341
31,948
*The accompanying notes are an integral part of the financial statements.*

Approved by the Board:

((Signature))

Travis Engen, Director

((Signature))

L. Denis Desautels, Director

	6

**Alcan Inc.**

**CONSOLIDATED STATEMENT OF CASH FLOWS**

Year ended December 31

(in millions of US$)

	 

	 

** **
**2005**
2004
2003
**OPERATING			ACTIVITIES**
			 
			 
			 
Net income 
**129**
258
64
Loss (Income) from discontinued operations
**26**
(15)
159
Income from continuing operations
**155**
243
223
Adjustments to determine cash from operating activities:
** **
			 
			 
Cumulative effect of accounting change
**-**
-
39
Depreciation and amortization
**1,080**
1,337
862
Deferred income taxes
**123**
45
(2)
Equity income, net of dividends
**(33)**
(16)
(11)
Asset impairment charges
**428**
100
36
Goodwill impairment
**122**
154
28
Stock option compensation
**19**
11
13
Write-off of acquired in-process research and development
**-**
-
50
Gain on disposals of businesses and investments - net
**(32)**
(47)
(44)
Change in operating working capital
** **
			 
			 
Change in  receivables
**(331)**
(437)
339
Change in inventories
**(6)**
24
69
Change in payables and accrued liabilities
**42**
234
61
Change in deferred charges, other assets, deferred credits
** **
			 
			 
and other liabilities, and post-retirement benefits -  net |
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