**Exhibit 99.3**

 

[ERNST & YOUNG LOGO]

 
|   | • | 120 Collins Street | • | Tel 61 3 9288 8000 |
|--------|--------|--------------------|--------|--------------------|
|   |   | Melbourne VIC 3000 |   | Fax 61 3 9654 6166 |
|   |   | Australia          |   | DX 293 Melbourne   |
|   |   | GPO Box 67         |   |               |
|   |   | Melbourne VIC 3001 |   |               |

 

**Report of Factual Findings**

 

Tothe Management of National Australia Bank Limited (the “National”)

 

**Scope**

We have performed theprocedures agreed with you as detailed in the engagement letter dated 1 December 2005and described below. Our engagement was undertaken in accordance withAustralian Auditing Standard applicable to agreed-upon procedures engagements.The responsibility for determining the adequacy or otherwise of the proceduresagreed to be is that of the National. The procedures were performed solely toassist you in evaluating the custodial procedures and accuracy of theinformation provided by the National, trading as HomeSide (the “Servicer”), tothe Global Trust Manager for the National RMBS Trust 2004-1 (the “Trust”), asrequired by the Servicing Agreement dated 24 January 2001 (the “ServicingAgreement”) and are summarized as follows:

 

1)       Obtained a copy of the custodial proceduresadopted by the Servicer and through a selection of a sample of 20 loanaccounts, compared the accuracy of the information in respect of the mortgageloans contained in the statements issued by the Servicer throughout the periodfrom 1 October 2004 to 30 September 2005.

 

2)       Through observation and inquiry ofmanagement, noted whether the 20 loan accounts selected above have beencomplied with the followings:

a)       the mortgage loans forming part of the assetsof the Trust are capable of identification and distinguishable from the otherassets of the**Servicer;

b)       controls exist so that the relevant mortgagetitle documents cannot be removed of tampered with, except with appropriate authorisation;and

c)       a tracking system is in place so that thelocation of the security packages containing the relevant mortgage titledocuments can be detected at any time.

 

3)       Through observation and inquiry ofmanagement, noted whether the relevant security packages of the 20 loanaccounts selected above contain the following:

a)       an original counterpart of the correspondingmortgage and each collateral security; and

b)       the certificate of title (if any) in respectof the land which is the subject of the mortgage.

 

Because the aboveprocedures do not constitute either an audit in accordance with AustralianAuditing Standards or a review in accordance with Australian Auditing Standardsapplicable to review engagements, we do not express any assurance on thecustodial procedures and accuracy of the information provided by the National,trading as the Servicer, to the Global Trust Manager for the Trust, as requiredby the Servicing Agreement dated 24 January 2001. Had we performedadditional procedures or had we performed an audit in accordance withAustralian Auditing Standards or a review in

 
|   | Liability  Limited by the Scheme, approved Under  Professional Standards |
|--------|--------------------------------------------------------------------------|

 

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accordance withAustralian Auditing Standards applicable to review engagements, other mattersmight have come to our attention that would have been reported to you.

 

**Findings**

 

We report our findings asfollows:

 

We requested a selectionof 20 loan accounts from the National RMBS Trust 2004-1 loan pool. However wewere only provided with 19 security packets. Management stated that one loanaccount was being discharged at the time of our procedures. As a consequencethe file was temporarily removed from the Custody site to the Dischargesdivision at National Mortgage Center within the National. The National hasagreed that the sample of 19 loan accounts was sufficient for this engagement(as shown in Appendix 1). Accordingly all procedures noted above have beenperformed based on the sample of 19 loan accounts.

 

1)       Withrespect to Procedure 1 above no issues were noted in comparing the accuracy of theinformation in respect of the mortgage loans contained in the statements issuedby the Servicer throughout the period from 1 October 2004 to 30 September 2005to our sample of 19 loan files.

 

2)       With respect to Procedure 2 we found that:

 

a)       the 19 loan accounts formed part of theassets of the Trust and are capable of identification and are distinguishablefrom the other assets of the Servicer;

b)       there arecontrols in place so that the relevant mortgage title documents cannot beremoved or tampered with, except with appropriate authorisation;

c)       a trackingsystem is in place so that the location of the relevant security packagescontaining the mortgage title documents can be identified at any time.

 

3)       With respect to Procedure 3 we found that the19 security packages contained:

a)       an original counterpart of the correspondingmortgage and each collateral security; and

b)       the certificate of title (if any) in respectof the land which is the subject of the mortgage.

 

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Our report is intendedsolely for purpose set forth in the first paragraph of this report and for yourinformation and is not to be for any other purpose of distributed to any otherparty.

 

 
| /s/ Ernst &  Young |   |
|-----------------------------|--------|
| Ernst & Young      |   |
|                        |   |
|                        |   |
| /s/ T J Coyne               |   |
| T J Coyne                   |   |
| Partner                     |
| Melbourne                   |
|                        |
| 8  December 2005       |

 

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**Appendix 1 - Sample of 19 loanaccounts**

 
| **Test #** | ** ** | **Account  Number** | ** ** | **Packet Code**             | ** ** | **Customer Name**                                   |
|------------|------------|---------------------|------------|-----------------------------|------------|-----------------------------------------------------|
| 1          |       | 100046831           |       | HSP2-BUCK(46)               |       | Buckle, Noel Rigney & Marika Ellen         |
| 2          |       | 100341849           |       | HSP2-COLL(133)              |       | Collins, Bradford John & Christine Jean    |
| 3          |       | 100404029           |       | HSP2-IASI(1)                |       | Iasiello, Silvana                                   |
| 4          |       | 101268620           |       | HSP2-DI(48)                 |       | Di Battista Sandro Mario, & Elaine Mary    |
| 5          |       | 101890890           |       | HSP2-REAL(1)                |       | Real, David Ross                                    |
| 6          |       | 102223846           |       | HSP2-TURN(96)               |       | Turner Edward & Susan Lynette              |
| 7          |       | 102275363           |       | HSP2-BOGD(5)                |       | Bogdanov Steven John                                |
| 8          |       | 102297167           |       | HSP2-SHAR(36)               |       | Sharman William Robert, Heather                     |
| 9          |       | 102356331           |       | HSP2-DEJO(1)                |       | Dejong Peter Reindert Lucas & Paulin Janet |
| 10         |       | 102746700           |       | HSP2-CHAN(67)               |       | Chan, Kevin Gary                                    |
| 11         |       | 103880194           |       | HSP2-ROBE(137)              |       | Robertson Michael William, Rosalind Robertson       |
| 12         |       | 103888268           |       | HSP2-DINI(1) & (3) |       | Diniotis, Leo & Dimopolous Anna            |
| 13         |       | 103983572           |       | HSP2-COOK(40)               |       | Cook Gavin Mark & Belinda Joan             |
| 14         |       | 104128746           |       | HSP2-TAUF(1)                |       | Taufer E/V                                          |
| 15         |       | 104527050           |       | HSP2-COHE(4)                |       | Cohen Geoffrey &* *Lenay              |
| 16         |       | 105007364           |       | HSP2-MINH(1)                |       | Minhaj Abdul Hamid & Riga                  |
| 17         |       | 105142961           |       | HSP2-ANDE(92)               |       | Anderson Ian Thomas                                 |
| 18         |       | 105552776           |       | HSP2-MARS(63)               |       | Marsland Ian David &* *Jacqueline     |
| 19         |       | 106536268           |       | HSP2-DREW(17)               |       | Drew Sophie Juliet                                  |

 

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