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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549



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FORM 10-K



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(Mark One)



|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------

For the Fiscal Year Ended December 31, 2005

Commission File Number 33-115353

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period fromto



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THE BEACON
FINANCIAL FUTURES FUND, L.P.

(Exact name of Registrant as specified in its charter)



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|                                                              |  |                                     
|------------------------------------------------------------- |  | ------------------------------------
|DELAWARE                                                      |  | 20-0963234                          
|(State or other jurisdiction ofincorporation or organization) |  | (IRS Employer Identification Number)
|                                                              | 
|116 Village Boulevard, Suite 210Princeton, New Jersey         |  | 08540                               

Registrants telephone number, including area code: 609-514-1801

Securities registered pursuant to Section 12 (b) of the Act: None

Securities registered pursuant to Section 12 (g) of the Act: Units of Limited Partnership Interest

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act:     Yes ̈No  x

Indicate by check mark if the Registrant is not
required to file reports pursuant to Section 13 or Section 15(d) of the Act:     Yes ̈No  x

Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.    Yes  x    No ̈

Indicate by check mark if the disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the Registrants knowledge, in definitive proxy or information statements incorporated by reference in Part II of this Form 10-K or any amendment to this Form 10-K. ̈

Indicate by check mark whether the Registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act (check one):

|                         |  |                    |  |                           
|------------------------ |  | ------------------ |  | --------------------------
|Large Accelerated Filer ̈ |  | Accelerated Filer ̈ |  | Non-accelerated filer    x

Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule
12b-2)    Yes ̈No  x

The Registrant has no voting common equity. The aggregate market value of Limited Partnership Units held by non-affiliates of the Registrant as of June 30, 2005 was
$10,000. For purposes of this disclosure, units held by officers or principals of the General Partner have been excluded because such persons may be deemed affiliates. This determination is not necessarily conclusive.

Total number of pages: 28 plus exhibits



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TABLE OF CONTENTS



|                                                                                                                      |  |   
|--------------------------------------------------------------------------------------------------------------------- |  | --
|PART I                                                                                                               
|Item 1. Business                                                                                                      |  | 1 
|Item 1A. Risk Factors.                                                                                                |  | 2 
|Item 2. Properties.                                                                                                   |  | 2 
|Item 3. Legal Proceedings.                                                                                            |  | 2 
|Item 4. Submission of Matters to a Vote of Security Holders.                                                          |  | 2 
|                                                                                                                     
|PART II                                                                                                              
|                                                                                                                      | 
|Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. |  | 2 
|Item 6. Selected Financial Data.                                                                                      |  | 3 
|Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.                        |  | 4 
|Item 7A. Quantitative and Qualitative Disclosures About Market Risk                                                   |  | 7 
|Item 8. Financial Statements and Supplementary Data                                                                   |  | 10
|Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                          |  | 10
|Item 9A. Controls and Procedures                                                                                      |  | 10
|Item 9B. Other Information                                                                                            |  | 10
|                                                                                                                     
|PART III                                                                                                             
|                                                                                                                      | 
|Item 10. Directors and Executive Officers of the Registrant                                                           |  | 11
|Item 11. Executive Compensation                                                                                       |  | 12
|Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters               |  | 12
|Item 13. Certain Relationships and Related Transactions                                                               |  | 13
|Item 14. Principal Accounting Fees and Services                                                                       |  | 13
|                                                                                                                     
|PART IV                                                                                                              
|                                                                                                                      | 
|Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K                                             |  | 13

DOCUMENTS INCORPORATED BY REFERENCE - Prospectus dated May 13, 2005 included within the Registration
Statement on Form S-1 (File No. 333-115353), incorporated by reference into Parts I, II, III and IV.



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PART I

Item 1. Business

The Beacon Financial Futures Fund, L.P. (the Partnership or Registrant) is a
Delaware limited partnership, which operates as a commodity investment pool. The Partnership was organized on April 6, 2004 to engage in the speculative trading of a diversified portfolio of commodity interests including futures contracts, options
on futures contracts and forward contracts. The Partnerships limited partnership agreement provides, among other things, that the Partnership shall dissolve no later than December 31, 2052.

Beacon Management Corporation (USA), the general partner and trading advisor of the Partnership (the General Partner), is registered as a commodity pool
operator and commodity trading advisor with the National Futures Association (the NFA), an industry self regulatory organization. In addition to making all trading decisions in its capacity as trading advisor, Beacon Management
Corporation (USA) conducts and manages all aspects of business and administration of the Partnership in its role as General Partner. UBS Financial Services currently serves as the Partnerships sole clearing broker. The Partnership may also use
Man Financial as an additional clearing broker.

The Partnership originally filed a registration statement with the U.S. Securities and Exchange Commission
for the sale of a minimum of $1,000,000 and a maximum of $200,000,000 in Units of Limited Partnership Interest at $1,000 each, which registration statement was effective on May 13, 2005. Since May 16, 2005, Units of Limited Partnership Interest of
the Partnership have been offered on an ongoing basis during the Partnerships continuing offering period. During the continuing offering period, subscriptions are accepted monthly and proceeds are transferred to bank and brokerage accounts for
trading purposes. The Unit selling price during the continuing offering period is the net asset value per unit as of the last business day of the month in which the subscription is accepted.

The Partnership was initially capitalized by the General Partner on April 12, 2004 through the contribution of $1,000 in exchange for one unit of partnership interest.
On March 30, 2005, the General Partner made an additional contribution of $999,000 in exchange for 999 units of partnership interest. The Partnership commenced operations on May 16, 2005. The General Partner and limited partners share in the profits
and losses of the Partnership in proportion to their respective ownership interests.

During the period from April 6, 2004 to June 30, 2005, the General
Partner deposited funds with the Partnership for the Partnerships SEC and NASD registration fees. At December 31, 2004, $1,311 was due from the Partnership to the General Partner, representing the difference between funds deposited and fees
paid by the Partnership. The Partnership reimbursed the General Partner in September 2005.

Regulation

As a commodity investment pool, the Partnership is subject to the regulations of the Commodity Futures Trading Commission, an agency of the United States (U.S.)
government, which regulates most aspects of the commodity futures industry; rules of the NFA; and the requirements of commodity exchanges and Futures Commission Merchants (brokers) through which the Partnership trades. As a registrant with the
Securities and Exchange Commission, the Partnership is subject to the regulatory requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934.

Operations

A description of the business of the Partnership, including trading approach, rights and
obligations of the Partners, and compensation arrangements is contained in the Prospectus under Summary, Risk Factors, The General Partner, Conflicts of Interest and Charges to the
Partnership, and such description is incorporated herein by reference from the Prospectus.

The Partnership conducts its business in one industry
segment, the speculative trading of futures, forwards and swap contracts. The Partnership is a market participant in the managed futures industry. The managed



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futures industry has grown substantially in the previous ten years. Market participants include all types of investors, such as corporations, employee
benefit plans, individuals and foreign investors. Service providers of the managed futures industry include (a) pool operators, which conduct and manage all aspects of trading funds (except trading decisions), such as the Partnership, (b) trading
advisors, which make the specific trading decisions, and (c) commodity brokers, which execute and clear the trades pursuant to the instructions of the trading advisor. The Partnership has no employees, and does not engage in the sale of goods or
services.

The Partnership engages in financial instrument trading in approximately 10 financial instrument contracts on domestic markets. All of the
Partnerships assets are currently allocated to the Enhanced Financial program which is concentrated in the financial markets such as interest rates and currency. As of December 2005, the Partnerships risk allocations (as measured by
Value at Risk (VaR)) were -0.25% and -1.33% in interest rate and currency markets, respectively. The contracts traded by the Partnership will fluctuate from time to time.

The Partnership may, in the future, experience increased competition for the futures and other contracts in which it trades. Beacon Management Corporation (USA) will recommend similar or identical trades for other
accounts under its management. Such competition may also increase due to the widespread utilization of computerized methods similar to those used by Beacon Management Corporation (USA).

Item 1A. Risk Factors.

The Partnership has a limited operating history. As a consequence, potential investors are
therefore unable to consider a long period of past performance results in making a decision whether to subscribe for Partnership units.

The Partnership
relies on the General Partner and therefore does not obtain any potential benefit from outside managers. The General Partner will make all material management and trading decisions for the partnership. The General Partner cannot assure you that the
management decisions it makes for the trading program it employs will be profitable for the Partnership or will not result in losses.

Item 2. Properties.

The Partnership does not use any physical properties in the conduct of its business. Its assets
currently consist of futures and other contracts and cash.

Item 3. Legal Proceedings.

Beacon Management Corporation (USA) is not aware of any material legal proceedings to which
the Partnership is a party or to which any of its assets are subject.

Item 4. Submission of Matters to a Vote of Security Holders.

No matters were submitted to a vote of limited partners
during the fiscal year 2005.

PART II

Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

There is no established market for the Units of Limited Partnership. The Units are offered on a best efforts basis by both representatives of the General Partner and certain broker-dealers. An offering on a best-efforts basis is one in
which the securities dealers participating in the offering are under no obligation to purchase any of the securities being offered and, therefore, no specified number of securities are guaranteed to be sold and no specified amount of money is
guaranteed to be raised. As of December 31, 2005, there were 9 Partners in the Partnership and 1,069.31 Units of Limited Partnership Interest outstanding.



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Beacon Management Corporation (USA) has sole discretion in determining what distributions, if any, the Partnership will
make to its Unit holders. Beacon Management Corporation (USA) has not made any distributions as of the date hereof.

The Partnership has no securities
authorized for issuance under any equity compensation plans.

The following table shows for the periods indicated the high and low sales prices for units:



|                                     |  |      |          |     |   |       
|------------------------------------ |  | ---- | -------- | --- | - | ------
|                                     |  | HIGH |          | LOW
|May 16, 2005  June 30, 2005:        |  | $    | 1,000.00 |     | $ | 982.27
|July 1, 2005  September 30, 2005:   |  | $    | 981.10   |     | $ | 967.03
|October 1, 2005  December 31, 2005: |  | $    | 1,012.51 |     | $ | 989.38

Item 6. Selected Financial Data.



|                            |  |                                   |           |  
|--------------------------- |  | --------------------------------- | --------- | -
|                            |  | For the YearEndedDecember 31,2005 |          
|Gains (losses) from trading |  |                                   | 31,762    |  
|Interest income             |  |                                   | 26,190    |  
|Total expenses              |  |                                   | 64,602    |  
|Net income (loss)           |  |                                   | (6,650    | )
|                            | 
|                            |  | As ofDecember 31,2005             |          
|Total assets                |  | $                                 | 1,084,631 |  
|Total partners capital     |  |                                   | 1,062,044 |  

SUPPLEMENTARY FINANCIAL INFORMATION

The following summarized quarterly financial information presents the Partnerships results of operations for the period May 16 through June 30, 2005 and the three
month periods ending September 30 and December 31, 2005.



|                            |  |                            |         |   |                 |   |        |                 |  |   |       
|--------------------------- |  | -------------------------- | ------- | - | --------------- | - | ------ | --------------- |  | - | ------
|                            |  | May 16through June 30,2005 |         |   | 3rd Quarter2005 |   |        | 4th Quarter2005
|Gains (losses) from trading |  | $                          | (11,901 | ) |                 | $ | 11,411 |                 |  | $ | 32,251
|Total income (loss)         |  |                            | (4,571  | ) |                 |   | 19,834 |                 |  |   | 42,688
|Net income (loss)           |  |                            | (17,725 | ) |                 |   | (4,823 | )               |  |   | 15,898



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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.

Introduction

The offering of its Units of Limited Partnership Interest commenced on May 13, 2005 and the Partnership commenced operations on May 16, 2005. The
continuing offering period commenced at the termination of the initial offering period and is ongoing.

Critical Accounting Policies

The General Partner believes that the accounting policies most critical to the Partnerships financial condition and results of operations
relate to the valuation of the Partnerships positions. The majority of the Partnerships positions are exchange-traded futures contracts, which are valued daily at settlement prices published by the exchanges. Any spot and forward foreign
currency contracts held by the Partnership are valued at published daily settlement prices or at dealers quotes. Thus, the General Partner expects that under normal circumstances substantially all of the Partnerships assets are valued on
a daily basis using objective measures.

Capital Resources

The Partnership will raise additional capital only through the sale of Units offered pursuant to the continuing offering, and does not intend to raise any capital through borrowing. Due to the nature of the
Partnerships business, it will make no capital expenditures and will have no capital assets that are not operating capital or assets.

Liquidity

Most United States commodity exchanges limit fluctuations in futures contracts prices during a single day by regulations
referred to as daily price fluctuation limits or daily limits. During a single trading day, no trades may be executed at prices beyond the daily limit. This may affect the Partnerships ability to initiate new positions
or close existing ones or may prevent it from having orders executed. Futures prices have occasionally moved the daily limit for several consecutive days with little or no trading. Similar occurrences could prevent the Partnership from promptly
liquidating unfavorable positions and subject the Partnership to substantial losses, which could exceed the margin initially committed to such trades. In general, the Partnership will be required to have 9%17% of its assets committed to margin
on deposit with the broker. In addition, even if futures prices have not moved the daily limit, the Partnership may not be able to execute futures trades at favorable prices if little trading in such contracts is taking place.

Trading in forward contracts introduces a possible further impact on liquidity. Because such contracts are executed off exchange between private parties, the
time required to offset or unwind these positions may be greater than that for regulated instruments. This potential delay could be exacerbated to the extent a counterparty is not a United States person.

Other than these limitations on liquidity, which are inherent in the Partnerships futures trading operations, the Partnerships assets are expected to be
highly liquid.

Results of Operations

The
return for the year ended December 31, 2005 was -0.68%.



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2005

RESULTS OF OPERATIONS



|                                             |  |             
|-------------------------------------------- |  | ------------
|For the Three Months Ended December
31, 2005
|                                             | 
|Sector                                       |  | %Gain (loss)
|                                             | 
|Currencies                                   |  | 2.33%       
|                                             | 
|Interest Rates                               |  | 0.83%       
|                                             | 
|Total                                        |  | 3.16%       

The Partnership commenced trading operations on May 16, 2005. Longer term interest rate products performed well
during May, with treasury bonds being a notable winner. The gains were offset by losses in the Eurodollar. The currency sector incurred a net loss with profits in the Japanese yen offset by losses in the Canadian dollar.

Market activity was mixed in June, as some markets exhibited relatively smooth trends, while others were marked by reversals and volatility. The Swiss franc, euro,
British pound, and Japanese yen had positive returns for June. These gains were overshadowed by losses in the Canadian dollar and Australian dollar. The interest rate sector was negative on the month, led by the Eurodollar contract. The 10-year
T-note was slightly positive on the month, while the Treasury bond and 5-year T-note posted modest losses.

The Partnership posted a loss for July. The
currency sector posted a gain as the Japanese yen, Swiss franc, and British pound all moved lower in value relative to the dollar, extending their long-term trends. The Australian dollar reversed direction early in the month, resulting in a modest
loss. The Canadian dollar was more volatile, also resulting in a small loss. The interest rate sector was marked by uneven performance. Eurodollars continued their downward trend as prices moved steadily lower in July, reflecting rising interest
rates in the United States, yielding solid profits. These gains were countered by losses in the longer term interest rate contracts which were marked by trend reversals, as prices fell in July, putting an end to 3 months of upward price movement.

The Partnership posted a loss for August. The currency sector posted a small net gain led by the Canadian dollar, which continued a trend toward higher
prices. Those gains were partially offset by losses in the remaining currencies, all of which rose briefly at the beginning of the month and then declined in response to a stronger dollar. The interest rate sector incurred a net loss for the month.
The Eurodollar market was the largest contributor to this loss, as the market exhibited substantial volatility. Coming off a trend toward lower prices, Eurodollar prices reversed at the start of the month, and spiked higher. This price increase
reflected the markets expectation that the Federal Reserve would lower short-term interest rates in the near-term. The remaining interest rate contracts incurred similar but smaller losses as longer-term rates moved in tandem with short-term
rates.

The Partnership posted a gain for September. The currency sector posted a gain led by the Canadian dollar which traded to a high price relative to
the U.S. dollar reflecting the value of its natural resources coupled with the strength of its economy. The other major foreign currencies traded lower relative to the U.S. dollar. The interest rate sector also posted a gain for the month led by the
Eurodollar market, as the trend toward higher U.S. interest rates resumed. The price decline reflected the markets expectation that the Federal Reserve would continue to raise short-term interest rates during the final months of the year. The
remaining interest rate contracts generally traded to lower prices and higher yields in sympathy with the short-term rates.

The Partnership posted a gain
for October. The currency sector posted a gain led by the Japanese yen which traded to a lower price relative to the U.S. dollar continuing a trend that began in January 2005. The yen has declined nearly 14% since the beginning of the year. The
other major foreign currencies had relatively modest fluctuations to the U.S. dollar. The interest rate sector also posted a gain for the month. The Eurodollar market was the largest contributor to this gain, as the trend toward higher U.S. interest
rates continued. The price decline reflected the markets expectation that the Federal Reserve would continue to raise short-term interest rates during the final months of the year. The remaining interest rate contracts generally traded to
lower prices, higher yields in sympathy with the short-term rates.



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The Partnership posted a gain for November. The currency sector posted a gain led by the Japanese yen which continuing a
decline of almost 17% relative to the U.S. dollar that began in January 2005. The other major foreign currencies contributed smaller gains also reflecting lower values relative to the U.S. dollar. The interest rate sector posted mixed results for
the month. The Eurodollar market was profitable for the month, as the trend toward higher short-term U.S. interest rates continued. This market is reflecting the expectation that the Federal Reserve would continue to raise short-term interest rates
during the months ahead. The remaining long-term interest rate contracts generally traded to higher prices, lower yields anticipating a gradual slowing of the economy and lower inflation.

The Partnership posted a loss for December. The currency sector posted a loss led by the Japanese yen. The Japanese yen traded to a higher price relative to the U.S.
dollar for the first time in 2005. After declining nearly 17% since the beginning of the year, the yen increased in value by nearly 5% during December. Among the other major foreign currencies, the British pound gained slightly relative to the U.S.
dollar and the others were virtually unchanged. The interest rate sector also posted a loss for the month. The Eurodollar market was slightly profitable for the month, as the trend toward higher short-term U.S. interest rates abated. This market is
reflecting the expectation that the Federal Reserve will not continue to raise short-term interest rates during the months ahead. The remaining interest rate contracts generally traded to higher prices, lower yields anticipating a slowing economy
and lower inflation.

Off-Balance Sheet Risk

The term off-balance sheet risk refers to an unrecorded potential liability that, even though it does not appear on the balance sheet, may result in future obligation or loss. The Partnership trades in futures and forward
contracts and may therefore become a party to financial instruments with elements of off-balance sheet market and credit risk. In entering into these contracts, there exists a market risk that such contracts may be significantly influenced by
conditions, such as interest rate volatility, resulting in such contracts being less valuable. If the markets should move against all of the futures interests positions of the Partnership at the same time, and if the General Partner was unable to
offset such positions, the Partnership could experience substantial losses. The General Partner accesses daily positions and profit and loss summaries for the Partnership and employs various measures to monitor draw-downs, market diversification and
leverage.

In addition to market risk, in entering into futures and forward contracts there is a credit risk that a counterparty will not be able to meet
its obligations to the Partnership. The counterparty for futures contracts traded in the United States and on most foreign exchanges is the clearinghouse associated with such exchange. In general, clearinghouses are backed by the corporate members
of the clearinghouse who are required to share any financial burden resulting from the non-performance by one of their members and, as such, should significantly reduce this credit risk. In cases where the clearinghouse is not backed by the clearing
members, like some foreign exchanges, it is normally backed by a consortium of banks or other financial institutions.

In the case of forward and swap
contracts, which are traded on the interbank market rather than on exchanges, the counterparty is generally a single bank or other financial institution, rather than a group of financial institutions; thus there may be a greater counterparty credit
risk. Beacon Management Corporation (USA) trades for the Partnership only with those counterparties which it believes to be creditworthy. All positions of the Partnership are valued each day on a mark-to-market basis. There can be no assurance that
any clearing member, clearinghouse or other counterparty will be able to meet its obligations to the Partnership.

Disclosures About Certain Trading
Activities that Include Non-Exchange Traded Contracts Accounted for at Fair Value

The Partnership invests in futures and forward contracts. The
market value of futures (exchange-traded) contracts is determined by the various futures exchanges, and reflects the settlement price for each contract as of the close of the last business day of the reporting period. The market value of forward
(non-exchange traded) contracts is extrapolated on a forward basis from the spot prices quoted as of 5:00 P.M. (E.T.) of the last business day of the reporting period or based on the market value of its exchange-traded equivalent.



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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

INTRODUCTION

Past Results Not Necessarily Indicative of Future Performance.

The
Partnership is a speculative commodity pool. The market sensitive instruments held by it are acquired for speculative trading purposes, and all or a substantial amount of the Partnerships assets are subject to the risk of trading loss. Unlike
an operating company, the risk of market sensitive instruments is integral, not incidental, to the Partnerships main line of business.

Market
movements can produce frequent changes in the fair market value of the Partnerships open positions and, consequently, in its earnings and cash flow. The Partnerships market risk is influenced by a wide variety of factors, including the
level and volatility of exchange rates, interest rates, equity price levels, the market value of financial instruments and contracts, the diversification effects among the Partnerships open positions and the liquidity of the markets in which
it trades.

The Partnership may rapidly acquire and liquidate both long and short positions in a wide range of different markets. Consequently, it is not
possible to predict how a particular future market scenario will affect performance, and the Partnerships past performance is not necessarily indicative of its future results.

Value at Risk is a measure of the maximum amount which the Partnership could reasonably be expected to lose in a given market sector. However, the inherent uncertainty of the Partnerships speculative trading and
the recurrence in the markets traded by the Partnership of market movements far exceeding expectations could result in actual trading or non-trading losses far beyond the indicated Value at Risk or the Partnerships experience to date (i.e.,
risk of ruin). In light of this, as well as the risks and uncertainties intrinsic to all future projections, the inclusion of the quantification included in this section should not be considered to constitute any assurance or
representation that the Partnerships losses in any market sector will be limited to Value at Risk or by the Partnerships attempts to manage its market risk.

Standard of Materiality

Materiality as used in this section, Quantitative and Qualitative Disclosures about Market
Risk, is based on an assessment of reasonably possible market movements and the potential losses caused by such movements, taking into account the leverage, and multiplier features of the Partnerships market sensitive instruments.

Quantifying the Partnerships Trading Value at Risk

Quantitative Forward-Looking Statements

The following quantitative disclosures regarding the
Partnerships market risk exposures contain forward-looking statements within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in
Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). All quantitative disclosures in this section are deemed to be forward-looking statements for purposes of the safe harbor, except for statements of
historical fact (such as the dollar amount of maintenance margin required for market risk sensitive instruments held at the end of the reporting period).

The Partnerships risk exposure in the various market sectors traded by the Partnership is quantified below in terms of Value at Risk (VaR). The Partnership estimates VaR using a model based on historical simulation (with a
confidence level of 97.5%) which involves constructing a distribution of hypothetical daily changes in the value of the trading portfolio. The VaR model takes into account linear exposures to risks, including equity and commodity prices, interest
rates, and correlation among these variables. The hypothetical changes in portfolio value are based on daily percentage changes observed in key market indices or other market factors to which the portfolio is sensitive. The one day 97.5 confidence
level of the Partnerships VaR corresponds to the negative change in portfolio value that, based on observed market risk factors, would have been exceeded once in 40 trading days or one day in 40. VaR typically does not represent the worst case
outcome.



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The Partnership uses approximately one year of daily market data and revalues its portfolio for each of the historical
market moves that occurred over the period. This generates a probability distribution of daily simulated profit and loss outcomes. The VaR is the 2.5 percentile of this distribution.

The VaR for a sector represents the one day downside risk for the aggregate exposures associated with this sector. The aggregate VaR represents the VaR of the
Partnerships open positions across all market sectors, and is less than the sum of the VaRs for all such market sectors due to the diversification benefit across asset classes.

The Partnerships VaR computations are based on the risk representation of the underlying benchmark for each instrument or contract and does not distinguish between exchange and non-exchange dealer-based
instruments. It is also not based on exchange and/or dealer based maintenance margin requirements.

VaR models, including the Partnerships, are
continually evolving as trading portfolios become more diverse and modeling techniques and systems capabilities improve. Please note that the VaR model is used to numerically quantify market risk for historic reporting purposes only and is not
utilized by the Partnership in its daily risk management activities. Please further note that VaR as described above may not be comparable to similarly titled measures used by other entities.

Due to the Partnerships mark-to-market accounting, any loss in the fair value of the Partnerships open positions is directly reflected in the
Partnerships earnings (realized or unrealized).

THE PARTNERSHIPS TRADING CAPITAL AT RISK IN DIFFERENT MARKET SECTORS

Value at Risk and Trading Gains/Losses by Sector

For the Three Months Ended December 31, 2005



|                 |  |                   |   |  |                |   
|---------------- |  | ----------------- | - |  | -------------- | --
|                 |  | December 31, 2005 |  
|Sector           |  | Value At Risk     |   |  | Rate of Return |   
|                 |  |                  
|Currencies       |  | -1.33             | % |  | 2.33           | % 
|                 |  |                  
|Interest Rates   |  | -0.25             | % |  | 0.83           | % 
|                 |  |                  
|Entire Portfolio |  | -1.33             | % |  | 3.16           | %1

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|1 | Of the return for the three months ended December 31, 2005, approximately 3.16% was due to trading gains net of commissions, 1.02% due to interest income, and
(-2.59%) due to fees and operating costs borne by the Partnership giving a net return of (1.60%).
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Material Limitations on Value at
Risk as an Assessment of Market Risk

The face value of the market sector instruments held by the Partnership may typically be many times the risk
determined by the VaR calculation. The magnitude of the Partnerships open positions could create a risk of ruin not typically found in most other investment vehicles. Because of the size of its positions, certain market conditions
 unusual, but historically recurring from time to time  could cause the Partnership to incur severe losses over a short period of time. The Value at Risk tables  as well as the past performance of the Partnership  give no
indication of this risk of ruin.

The highly dynamic nature of the Partnerships portfolio limits the usability of an analysis method
(such as VaR), which relies upon the Partnerships positions as of a single point in time.

Historical price behavior (which is relied upon by the VaR
calculation) may not be an accurate predictor of the future price behavior of the markets in the Partnerships portfolio.



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Non-Trading Risk

The Partnership may experience non-trading market risk on any foreign cash balances not needed for margin. However, these balances (as well as the market risk they represent) are expected to be immaterial. The Partnership also may have
non-trading market risk as a result of investing in U.S. Treasury Bills. The market risk represented by these investments is expected to be immaterial.

Qualitative Disclosures Regarding Primary Trading Risk Exposures

The following qualitative disclosures regarding the
Partnerships market risk exposures  except for (i) those disclosures that are statements of historical fact and (ii) the descriptions of how the Partnership manages its primary market risk exposures  constitute forward-looking
statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. The Partnerships primary market risk exposures as well as the strategies used and to be used by the General Partner for managing
such exposures are subject to numerous uncertainties, contingencies and risks, any one of which could cause the actual results of the Partnerships risk controls to differ materially from the objectives of such strategies. Government
interventions, defaults and expropriations, illiquid markets, the emergence of dominant fundamental factors, political upheavals, changes in historical price relationships, an influx of new market participants, increased regulation and many other
factors could result in material losses as well as in material changes to the risk exposures and the risk management strategies of the Partnership. There can be no assurance that the Partnerships market exposure and/or risk management
strategies will not change materially or that any such strategies will be effective in either the short- or long-term. Investors must be prepared to lose all or substantially all of their investment in the Partnership.

The primary risk exposures of the Partnership as of December 31, 2005 are exchange rate and interest rate risk. The factors that can influence these rates can be
domestic or foreign (primarily the G-7 countries) and include (but are not limited to) changes in government fiscal policy, changes in the balance of trade, changes in inflation rates and improvement or degradation of the overall economy.

Qualitative Disclosures Regarding Non-Trading Risk Exposure

The following were the only non-trading risk exposures of the Partnership as of December 31, 2005.

The Partnership may experience non-trading
market risk on any foreign cash balances not needed for margin. However, these balances (as well as the market risk they represent) are expected to be immaterial. The Partnership also may have non-trading market risk as a result of investing in U.S.
Treasury Bills. The market risk represented by these investments is expected to be immaterial.

Qualitative Disclosures Regarding Means of Managing
Risk Exposure

The means by which the Partnership attempts to manage the risk of the Partnerships open positions is essentially the same in
all market categories traded. The General Partner applies risk management policies to trading which generally are designed to limit the total exposure that may be taken per risk unit of assets under management. In addition, the General
Partner follows diversification guidelines (often formulated in terms of the balanced volatility between markets and correlated groups), as well as adopting non-binding stop-loss points for each of the markets in which the Partnership
trades.

General

The Partnership is unaware of
any (i) anticipated known demands, commitments or capital expenditures; (ii) material trends, favorable or unfavorable, in its capital resources; or (iii) trends or uncertainties that will have a material effect on operations. From time to time,
certain regulatory agencies have proposed increased margin requirements on futures contracts. Because the Partnership generally will use a small percentage of assets as margin, the Partnership does not believe that any increase in margin
requirements, as proposed, will have a material effect on the Partnerships operations.



9



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##### Table of Contents

Item 8. Financial Statements and Supplementary Data

Financial statements meeting the requirements of Regulation S-X
appear beginning on Page 18 of this report. The supplementary financial information specified by Item 302 of Regulation S-K is included in Item 6. Selected Financial Data.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Effective August 1, 2005,
the Partnership engaged Altschuler, Melvoin and Glasser LLP (AM&G) as the Companys principal accountants to audit the Partnerships financial statements for the year ending December 31, 2005. AM&G replaced Deloitte
& Touche LLP (Deloitte), which had previously been engaged for the same purpose, and whose dismissal was effective July 15, 2005. The decision to change the Partnerships principal accountants was approved by the
Partnerships General Partner on July 8, 2005.

The report of Deloitte on the Partnerships financial statements of financial condition as of
April 12, 2004 and December 31, 2004 did not contain an adverse opinion or disclaimer of opinion, nor was it qualified or modified as to uncertainty, audit scope or accounting principles.

During the period from April 12, 2004 through December 31, 2004 and in the subsequent interim period through July 8, 2005, there were no disagreements with Deloitte on
any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Deloitte, would have caused it to make reference to the subject matter of
the disagreements in connection with their respective report on the financial statements for such period.

During the period from April 12, 2004 through
December 31, 2004, and in the subsequent interim period through August 1, 2005, neither the Partnership nor anyone on its behalf consulted AM&G regarding either the application of accounting principles to a specified transaction, either
completed or proposed, or the type of audit opinion that might be rendered on the Partnerships financial statements, nor had AM&G provided to the Partnership a written report or oral advice regarding such principles or audit opinion.

During the interim period from August 1, 2005 through December 31, 2005 and through the date hereof, there were no disagreements with AM&G on any
matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of AM&G, would have caused it to make reference to the subject matter of the
disagreements in connection with their respective report on the financial statements for such period.

The report of AM&G on the Partnerships
financial statements for the year ended December 31, 2005 did not contain an adverse opinion or disclaimer of opinion, nor was it qualified or modified as to uncertainty, audit scope or accounting principles.

Item 9A. Controls and Procedures

Beacon Management Corporation (USA)., the General Partner of the Partnership, with
the participation of the General Partners chief executive officer, has evaluated the effectiveness of the design and operation of its disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) or
15d-15(e)) with respect to the Partnership as of the end of the period covered by this annual report. Based on their evaluation, the chief executive officer has concluded that these disclosure controls and procedures are effective. There were no
changes in the General Partners internal control over financial reporting applicable to the Partnership identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the last
fiscal quarter that have materially affected, or is reasonably likely to materially affect, internal control over financial reporting applicable to the Partnership.

Item 9B. Other Information

There was no information required to be disclosed in a report on form 8-K during the fourth
quarter of 2005.



10



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##### Table of Contents

PART III

Item 10. Directors and Executive Officers of the Registrant

The Partnership has no directors or executive officers.
The Partnership has no employees. It is managed by Beacon Management Corporation (USA) in its capacity as General Partner. Beacon Management Corporation (USA) has been registered as a commodity pool operator (CPO) since September 1982. Its main
business address is 116 Village Boulevard, Suite 210 Princeton, New Jersey 08540, (609) 514-1801. Beacon Management Corporation (USA)s directors and executive officers are as follows:

Grant W. Schaumburg, Jr., age 60, is the chairman of the General Partner. He has worked for the General Partner and affiliated firms since 1978 and began his
future career as a commodity trading advisor in 1973. He participated in management consulting work for large corporations and contract research for government agencies from 1970 to 1982. He was a partner of Comtrade Associates, a commodity trading
advisor that managed futures accounts from 1980 to 1982. Mr. Schaumburg served as trading systems manager for Commodities Corporation from 1982 to 1987, and also was an associated person with that firm from 1984 to 1993. He was a founder of Mount
Lucas Management Corporation and Mount Lucas Index Management Corporation, and was president of these firms from their inception through July 1999. Mr. Schaumburg is registered as a commodity trading advisor and a commodity pool operator and is a
member of the NFA. Mr. Schaumburg received an AB magna cum laude from Harvard College with highest honors in applied mathematics and a PhD in economics from Harvard University.

Mark S. Stratton, age 48, is the chief executive officer and president of the General Partner. He has worked for the General Partner and its affiliates since 1984, and became a principal in 1991. Mr. Stratton
began his futures career in 1972 at Commodities Corporation where he was senior research associate. He was a founder of Mount Lucas Management Corporation and Mount Lucas Index Management Corporation and senior vice president of these firms from
their inception through July 1999. He is responsible for operations, data processing, trading, and research, and developed the General Partners trade simulation, trade accounting and data processing software. Mr. Stratton attended the
University of Chicago.

Thomas J. Nash, age 60, is vice president of administration for the General Partner. He joined the General Partner in 1999,
and became a principal in July 2000. Prior to May 1990, he held a variety of positions with The Prudential Insurance Company of America and the Prudential Asset Management Company, including assignments involving marketing, marketing support,
product development, and administration. From May 1990 until March 1999, he was a principal of Zaramba-Nash Financial Services, Inc., a consulting organization that he co-founded. Mr. Nash received a BS in Marketing from Fairleigh Dickinson
University, an MBA with a concentration in finance from Seton Hall University, and has worked in the finance industry since 1963.

John W. Fryback,
age 58, is director of marketing for the General Partner. He is responsible for developing and maintaining relationships with institutional clients and commodity pool operators. He joined the General Partner in January 2000, and became a principal
in February 2001. Mr. Fryback has worked in the field of finance since 1971, holding various futures-related positions with Reynolds Securities, Inc. from 1976 to 1979; Elms Capital Management Corp. from 1979 to 1981; Kidder Peabody & Co. Inc.
from 1981 to 1988; and Chemical Bank from 1989 to 1991. From 1991 to present, Mr. Fryback has been a registered associated person and president of Fryback Associates, Inc., a consulting firm, which markets a variety of futures products for the
General Partner and its affiliates as an independent contractor. Mr. Fryback is also a registered associated person of Mount Lucas Management Corporation. Mr. Fryback received a BA in business management from Indiana University and has worked in the
finance industry since 1991.

There has never been a material administrative, civil or criminal action brought against Beacon Management Corporation (USA)
or any of its directors, executive officers, promoters or control persons.



11



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##### Table of Contents

Section 16(a) Beneficial Ownership Reporting Compliance

Based solely upon a review of the rules governing the requirements of filing Forms 3, 4 and 5 pursuant to Section 16(a) of the Exchange Act, the Partnership has
determined that Beacon Management Corporation (USA), Grant W. Schaumburg, Jr., Chairman of the General Partner, and Mark S. Stratton, Chief Executive Officer and President of the General Partner were each late in filing a Form 3.

Audit Committee Financial Expert

The Board of Directors of
Beacon Management Corporation (USA) has determined that Mark S. Stratton, Chief Executive Officer and President of the General Partner, qualifies as an audit committee financial expert in accordance with the applicable rules and regulations of the
U.S. Securities and Exchange Commission. Mr. Stratton is not independent as that term is defined in Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act.

Code of Ethics

Beacon Management Corporation (USA) has adopted a code of ethics for its chief executive
officer and persons performing similar functions. A copy of the code of ethics may be obtained at no charge by written request to Beacon Management Corporation (USA), 116 Village Boulevard, Suite 210, Princeton, New Jersey 08540 or by calling
1-609-514-1801.

Item 11. Executive Compensation

The Partnership is managed by its general partner, Beacon Management Corporation
(USA). Beacon Management Corporation (USA) receives from the Partnership a Fixed Asset Fee equal to 6.3% of the Partnerships month-end Net Assets per year. From such 6.3% Fixed Asset Fee, Beacon Management Corporation (USA) remits 3% to the
broker-dealers which engaged in the distribution of the Units in return for ongoing services to the Limited Partners. Beacon Management Corporation (USA) retains the remaining 3.3% as management fees (2% for providing advisory fees and 1.3% for
acting as general partner). Beacon Management Corporation (USA) also receives a performance fee of 20% of the aggregate cumulative appreciation (if any) in Net Asset Value per unit at the end of each calendar quarter, exclusive of the appreciation
attributable to interest income.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters



| | (a) | Security Ownership of Certain Beneficial Owners. As of December 31, 2005, 996.45 Units of Limited Partnership are owned or held by Grant W. Schaumburg, Jr. and Mark S. Stratton, the
officers and directors of Beacon Management Corporation (USA). These units represent 93.2% of the class.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                          |  |                          |  |                                                                                                                         |  |                 
|------------------------- |  | ------------------------ |  | ----------------------------------------------------------------------------------------------------------------------- |  | ----------------
|Title of Class            |  | Name of Beneficial Owner |  | Amount and Nature of BeneficialOwnership                                                                                |  | Percent of Class
|Limited Partnership Units |  | Grant W. Schaumburg, Jr. |  | 511.45 Units in direct ownership investment; 242.5 Units beneficially owned through Beacon Management Corporation (USA) |  | 70.5%           
|Limited Partnership Units |  | Mark S. Stratton         |  | 242.5 Units beneficially owned through Beacon Management Corporation (USA)                                              |  | 22.7%           



12



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##### Table of Contents

| | (b) | Security Ownership of Management. As of December 31, 2005, Grant W. Schaumburg, Jr. and Mark S. Stratton indirectly owned 485.0 Units of Limited Partnership Interest having a value
of $481,706 through Beacon Management Corporation (USA).
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Item 13. Certain Relationships and Related Transactions

See Item 11, Executive Compensation and Item 12, Security
Ownership of Certain Beneficial Owners and Management.

Item 14. Principal Accounting Fees and Services



| | (a) | Audit Fees:
| | --- | -----------

The aggregate fees incurred for professional
services rendered by Altschuler, Melvoin and Glasser LLP (AM&G) for the audit of the Partnerships annual financial statements, for review of financial statements included in the Partnerships Forms 10-Q and other services
normally provided in connection with regulatory filing or engagements for the year ended December 31, 2005 was $30,900.



| | (b) | Audit Related Fees:
| | --- | -------------------

There were no audit related fees
billed by AM&G during the year ended December 31, 2005.



| | (c) | Tax Fees:
| | --- | ---------

AM&G has a continuing relationship with RSM
McGladrey, Inc. (RSM), through which its partners provide non-audit services. As a result of this arrangement, AM&G has no full-time employees, and therefore, none of the audit services performed were provided by permanent full-time
employees of AM&G. AM&G manages and supervises the audit and audit staff, and is exclusively responsible for the opinion rendered in connection with its examination.

Tax compliance services for the year ending December 31, 2005 are to be provided by RSM and relate to the preparation of U.S. and applicable state
information tax returns. Tax fees for 2005 are to be billed by RSM.

The aggregate fees incurred for professional services rendered by RSM
for the preparation and filing of the Partnerships Schedule K-1s and all necessary federal and state tax returns for the year ended December 31, 2005 was $7,000.



| | (d) | All Other Fees:
| | --- | ---------------

There were no other fees billed by
AM&G during the year ended December 31, 2005.



| | (e) | The Board of Directors of Beacon Management Corporation (USA) approved all of the services described above. The Board of Directors has determined that the payments made to its
independent accountants for these services are compatible with maintaining such auditors independence. The Board of Directors explicitly pre-approves all audit and non-audit services and all engagement fees and terms.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

PART IV

Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K



13



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##### Table of Contents

| | (a) | The following documents are filed as part of this report:
| | --- | ---------------------------------------------------------



|       |  |                                                                                                                                                                                                                                                                               
|------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.     |  | See   Financial Statements beginning on page 19 hereof.                                                                                                                                                                                                                       
|       | 
|2.     |  | Schedules:                                                                                                                                                                                                                                                                    
|       |  | Financial statement schedules have been omitted because they are not included in the financial statements or notes hereto applicable or because equivalent information has been included in the
financial statements or notes thereto.                                        
|       | 
|3.     |  | Exhibits:                                                                                                                                                                                                                                                                     
|       | 
|NUMBER |  | DESCRIPTION OF DOCUMENT                                                                                                                                                                                                                                                       
|1.01   |  | Form of Selling Group Manager Agreement among the Registrant, Beacon Management Corporation (USA) and Uhlmann Price Securities, LLC.*                                                                                                                                         
|1.02   |  | Form of Selected Selling Agent Agreement between Uhlmann Price Securities, LLC and selling agents.*                                                                                                                                                                           
|3.01   |  | Form of Limited Partnership Agreement of the Registrant (included as Exhibit A to the prospectus).*                                                                                                                                                                           
|10.01  |  | Advisory Agreement between the Registrant and Beacon Management Corporation (USA)*                                                                                                                                                                                            
|10.02  |  | Customer Agreement between the Registrant and Man Financial Inc.*                                                                                                                                                                                                             
|10.03  |  | Customer Agreement between the Registrant and UBS Securities.*                                                                                                                                                                                                                
|16.01  |  | Letter from the Registrants former independent accountant, Deloitte & Touche LLP, regarding its concurrence the statements made by the registrant in its current report on Form 8-K
dated July 18, 2005 concerning their dismissal as the registrants principal accountant.*
|20.01  |  | Form of Subscription Requirements to be executed by each purchaser of units (included as Exhibit B to the prospectus).*                                                                                                                                                       
|20.02  |  | Form of Subscription Agreement and Power of Attorney to be executed by each purchaser of units (included as Exhibit C to the prospectus).*                                                                                                                                    
|31.01  |  | Certification by Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                            
|32.01  |  | Certification by Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                            

---

|* | Filed Previously
|- | ----------------

SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized on March 31, 2006.



The Beacon Financial Futures Fund, L.P.By:

Beacon Management Corporation (USA). General PartnerBy:

/s/ Mark S. StrattonMark S. StrattonChief Executive Officer




14



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##### Table of Contents

THE BEACON FINANCIAL FUTURES FUND, L.P.

ANNUAL REPORT

December 31, 2005



15



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##### Table of Contents

THE BEACON FINANCIAL FUTURES FUND, L.P.

INDEX



|                                                                                                                                                                           |  |       
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------
|                                                                                                                                                                           |  | PAGES 
|Independent Auditors Reports                                                                                                                                              |  | 17 -18
|                                                                                                                                                                           | 
|Financial Statements                                                                                                                                                       |  |       
|Statements of Financial Condition December 31, 2005 and 2004                                                                                                               |  | 19    
|                                                                                                                                                                           | 
|Condensed Schedules of Investments December 31, 2005 and December 31, 2004 (Unaudited)                                                                                     |  | 20    
|                                                                                                                                                                           | 
|Statements of Operations For the Year Ended December 31, 2005 and the Period from April 12, 2004 through December 31, 2004 (Unaudited)                                     |  | 21    
|                                                                                                                                                                           | 
|Statements of Changes in Partners Capital (Net Asset Value) For the Year Ended December 31, 2005 and the Period from April 12, 2004 through December 31, 2004 (Unaudited) |  | 22    
|                                                                                                                                                                           | 
|Financial Highlights                                                                                                                                                       |  |       
|For the Year Ended December 31, 2005 and the Period from April 12, 2004 through December 31, 2004 (Unaudited)                                                              |  | 23    
|                                                                                                                                                                           | 
|Notes to Financial Statements                                                                                                                                              |  | 24 -27



16



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##### Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the General Partner and Unit
Holder of

The Beacon Financial Futures Fund, L.P.

Princeton, New Jersey

We
have audited the accompanying statement of financial condition of The Beacon Financial Futures Fund, L.P. (the Fund) as of December 31, 2004. This financial statement is the responsibility of the Funds management. Our
responsibility is to express an opinion on this financial statement based on our audit.

We conducted our audit in accordance with
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 the statement of financial condition is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement of financial condition. An audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall statement of financial condition presentation. We believe that our audit of the statement of financial condition provides a reasonable basis of our opinion.

In our opinion, such statement of financial condition presents fairly, in all material respects, the financial position of the Fund as of
December 31, 2004, in conformity with accounting principles generally accepted in the United States of America.

/s/
DELOITTE & TOUCHE LLP

Princeton, New Jersey

February 3, 2005



17



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##### Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Partners of

The Beacon Financial Futures Fund, L.P.

We have audited the accompanying statement of financial condition of The Beacon Financial Futures Fund, L.P. (the Fund), including the condensed schedule of
investments, as of December 31, 2005 and the related statements of operations and changes in partners capital, and the financial highlights for the year then ended. These financial statements and financial highlights are the
responsibility of the Funds management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit.

We conducted our audit in accordance with auditing 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 the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of The Beacon
Financial Futures Fund, L.P. as of December 31, 2005 and the results of its operations and changes in its partners capital, and the financial highlights for the year then ended in conformity with accounting principles generally accepted
in the United States of America.

/s/ ALTSCHULER, MELVOIN AND GLASSER LLP

Chicago, Illinois

March 20, 2006



18



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Statements of Financial Condition

December 31, 2005 and 2004



|                                              |  |                  |           |                  |   |      
|--------------------------------------------- |  | ---------------- | --------- | ---------------- | - | -----
|                                              |  | December 31,2005 |           | December 31,2004
|ASSETS                                        |  |                  |           |                  |   |      
|Equity in Brokerage Accounts                  |  |                  |           |                  |   |      
|Cash                                          |  | $                | 1,022,740 |                  | $ |     
|Net Unrealized Gain on Open Futures Contracts |  |                  | 2,187     |                  |   |     
|                                              |  |                  |           |                  |   |      
|Total Equity in Brokerage Accounts            |  |                  | 1,024,927 |                  |   |     
|                                              |  |                 
|Other Cash                                    |  |                  | 32,665    |                  |   | 2,311
|Escrow Accounts Receivable                    |  |                  | 10,000    |                  |   |      
|Accounts Receivable                           |  |                  | 14,203    |                  |   |     
|Other Assets                                  |  |                  | 2,836     |                  |   |     
|                                              |  |                  |           |                  |   |      
|TOTAL ASSETS                                  |  | $                | 1,084,631 |                  | $ | 2,311
|                                              |  |                  |           |                  |   |      
|LIABILITIES & PARTNERS CAPITAL               |  |                  |           |                  |   |      
|Liabilities                                   |  |                  |           |                  |   |      
|Accrued Expenses                              |  | $                | 17,052    |                  | $ |     
|Accrued Commissions                           |  |                  | 115       |                  |   |     
|Fixed Asset Fee Payable                       |  |                  | 5,420     |                  |   |     
|Payable to General Partner                    |  |                  |          |                  |   | 1,311
|                                              |  |                  |           |                  |   |      
|Total Liabilities                             |  |                  | 22,587    |                  |   | 1,311
|                                              |  |                  |           |                  |   |      
|Partners Capital                             |  |                  |           |                  |   |      
|General Partners Capital                     |  |                  | 481,706   |                  |   | 1,000
|Limited Partners Capital                     |  |                  | 580,338   |                  |   |     
|                                              |  |                  |           |                  |   |      
|Total Partners Capital                       |  |                  | 1,062,044 |                  |   | 1,000
|                                              |  |                  |           |                  |   |      
|TOTAL LIABILITIES & PARTNERS CAPITAL         |  | $                | 1,084,631 |                  | $ | 2,311
|                                              |  |                  |           |                  |   |      

See Notes to the Financial Statements.



19



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Condensed Schedules of Investments

December 31, 2005 and December 31, 2004 (Unaudited)



|                              |  |                   |        |   |                     |       |   |             |   |                     |  |  
|----------------------------- |  | ----------------- | ------ | - | ------------------- | ----- | - | ----------- | - | ------------------- |  | -
|                              |  | December 31, 2005 |        |   | December 31, 2004  
|Description                   |  | Value             |        |   | % of NetAsset Value |       |   | Value       |   | % of NetAsset Value
|                              |  |                   |        |   |                     |       |   | (Unaudited)
|LONG FUTURES CONTRACTS        |  |                   |        |   |                     |       |   |             |   |                     |  |  
|Currencies                    |  | $                 | (2,900 | ) |                     | -0.27 | % |             | $ |                    |  | 
|                              |  |                   |        |   |                     |       |   |             |   |                     |  |  
|Total long futures contracts  |  |                   | (2,900 | ) |                     | -0.27 | % |             |   |                    |  | 
|                              |  |                   |        |   |                     |       |   |             |   |                     |  |  
|SHORT FUTURES CONTRACTS       |  |                   |        |   |                     |       |   |             |   |                     |  |  
|Currencies                    |  |                   | 6,866  |   |                     | 0.65  | % |             |   |                    |  | 
|Interest rates                |  |                   | (1,780 | ) |                     | -0.17 | % |             |   |                    |  | 
|                              |  |                   |        |   |                     |       |   |             |   |                     |  |  
|Total short futures contracts |  |                   | 5,087  |   |                     | 0.48  | % |             |   |                    |  | 
|                              |  |                   |        |   |                     |       |   |             |   |                     |  |  
|Total futures contracts       |  | $                 | 2,187  |   |                     | 0.21  | % |             | $ |                    |  | 
|                              |  |                   |        |   |                     |       |   |             |   |                     |  |  

See Notes to the Financial Statements.



20



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Statements of Operations

For the Year Ended December 31, 2005 and the Period from April 12, 2004
through December 31, 2004 (Unaudited)



|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|-------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------ | ------- | - | --------------------------------------------------- | - | -
|                                                                                                                                 |  | Year EndedDecember 31,2005 (1) |         |   | Period fromApril 12, 2004throughDecember 31,2004(2)
|                                                                                                                                 |  |                                |         |   | (Unaudited)                                        
|Trading Gains and Losses                                                                                                         |  |                                |         |   |                                                     |   |  
|Change in Unrealized                                                                                                             |  | $                              | 2,187   |   |                                                     | $ | 
|Realized                                                                                                                         |  |                                | 32,106  |   |                                                     |   | 
|Brokerage Commissions                                                                                                            |  |                                | (2,531  | ) |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Total Trading Gains and Losses                                                                                                   |  |                                | 31,762  |   |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Investment Income                                                                                                                |  |                                |         |   |                                                     |   |  
|Interest Income                                                                                                                  |  |                                | 26,190  |   |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Total Investment Income                                                                                                          |  |                                | 26,190  |   |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Total Income                                                                                                                     |  |                                | 57,952  |   |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Expenses                                                                                                                         |  |                                |         |   |                                                     |   |  
|Fixed Asset Fee                                                                                                                  |  |                                | 42,238  |   |                                                     |   | 
|Professional Fees                                                                                                                |  |                                | 28,014  |   |                                                     |   | 
|Operating Expenses                                                                                                               |  |                                | 9,519   |   |                                                     |   | 
|Offering Expenses                                                                                                                |  |                                | 2,500   |   |                                                     |   |  
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Total expenses before reimbursement of expenses                                                                                  |  |                                | 82,271  |   |                                                     |   | 
|                                                                                                                                 |  |                               
|Less: reimbursement of expenses                                                                                                  |  |                                | 17,669  |   |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Net Expenses                                                                                                                     |  |                                | 64,602  |   |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Net Investment Loss                                                                                                              |  |                                | (38,412 | ) |                                                     |   | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Net Income (Loss)                                                                                                                |  | $                              | (6,650  | ) |                                                     | $ | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Net Income (Loss) per General and Limited Partner Unit (Based on weighted average number of units outstanding during the
period) |  | $                              | (6.79   | ) |                                                     | $ | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  
|Income (Decrease) in Net Asset Value per General Partner and Limited Partner Unit                                                |  | $                              | (6.79   | ) |                                                     | $ | 
|                                                                                                                                 |  |                                |         |   |                                                     |   |  

---

|(1) | For the period from May 16, 2005 (commencement of operations) to December 31, 2005,
including certain one time expenses incurred during the initial operating period for the Partnership.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The Partnerships operations did not commence until May 16, 2005 and as such there
were no operations or changes in partners capital for the period April 12, 2004 through December 31, 2004.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

See Notes to the Financial Statements.



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Statements of Changes in Partners Capital

For the Year Ended December 31, 2005(1)and the Period from April 12, 2004 through December 31, 2004(2)(Unaudited)



|                                                       |  |                   |   |  |         |          |       |       |        |        |   |         |  |          |        |  |   |           |  
|------------------------------------------------------ |  | ----------------- | - |  | ------- | -------- | ----- | ----- | ------ | ------ | - | ------- |  | -------- | ------ |  | - | --------- | -
|                                                       |  | Partners Capital |  
|                                                       |  | General           |   |  | Limited |          | Total |      
|                                                       |  | Units             |   |  | Amount  |          |       | Units |        | Amount |   | Units   |  |          | Amount | 
|Initial General Partner Additions on April 12, 2004    |  | 1.00              |   |  | $       | 1,000    |       |       |       |        | $ |        |  | 1.00     |        |  | $ | 1,000     |  
|                                                       |  |                   |   |  |         |          |       |       |        |        |   |         |  |          |        |  |   |           |  
|Balances at December 31, 2004                          |  | 1.00              |   |  |         | 1,000    |       |       |       |        |   |        |  | 1.00     |        |  |   | 1,000     |  
|Net Income (Loss) for the Year Ended December 31, 2005 |  |                   |   |  |         | (14,988  | )     |       |        |        |   | 8,338   |  |          |        |  |   | (6,650    | )
|Additions                                              |  | 999.00            |   |  |         | 999,000  |       |       | 584.31 |        |   | 572,000 |  | 1,583.31 |        |  |   | 1,571,000 |  
|Redemptions                                            |  | (515.00           | ) |  |         | (503,306 | )     |       |       |        |   |        |  | (515.00  | )      |  |   | (503,306  | )
|                                                       |  |                   |   |  |         |          |       |       |        |        |   |         |  |          |        |  |   |           |  
|Balances at December 31, 2005                          |  | 485.00            |   |  | $       | 481,706  |       |       | 584.31 |        | $ | 580,338 |  | 1,069.31 |        |  | $ | 1,062,044 |  
|                                                       |  |                   |   |  |         |          |       |       |        |        |   |         |  |          |        |  |   |           |  

---

|(1) | For the period from May 16, 2005 (commencement of operations) to December 31, 2005,
including certain one time expenses incurred during the initial operating period for the Partnership.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The Partnerships operations did not commence until May 16, 2005 and as such there
were no operations or changes in partners capital for the period April 12, 2004 through December 31, 2004.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Beacon Financial Futures Fund, L.P.

Net Asset Value Per General and Limited Partner Unit



|                 |  |                 
|---------------- |  | ----------------
|December 31,2005 |  | December 31,2004
|$993.20          |  | $1,000.00       

See Notes to the Financial Statements.



22



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Financial Highlights

For the Year Ended December 31, 2005 and the Period from April 12, 2004 through December 31, 2004 (Unaudited)



|                                                            |  |                               |          |   |                                                     |   |         
|----------------------------------------------------------- |  | ----------------------------- | -------- | - | --------------------------------------------------- | - | --------
|                                                            |  | Year EndedDecember 31,2005(1) |          |   | Period FromApril 12, 2004throughDecember 31,2004(2)
|                                                            |  |                               |          |   | (Unaudited)                                        
|Per Unit Performance                                        |  |                               |          |   |                                                     |   |         
|                                                            |  |                              
|Net Asset Value per unit at the beginning of the period     |  | $                             | 1,000.00 |   |                                                     | $ | 1,000.00
|                                                            |  |                              
|Income                                                      |  |                               |          |   |                                                     |   |         
|Trading Gains and Losses                                    |  |                               | 31.10    |   |                                                     |   |        
|Investment Income                                           |  |                               |          |   |                                                     |   |         
|Interest Income                                             |  |                               | 25.86    |   |                                                     |   |        
|                                                            |  |                              
|Expenses                                                    |  |                               |          |   |                                                     |   |         
|Fixed Asset Fee                                             |  |                               | (41.69   | ) |                                                     |   |        
|Other Expenses                                              |  |                               | (22.06   | ) |                                                     |   |        
|                                                            |  |                               |          |   |                                                     |   |         
|Total Expenses                                              |  |                               | (63.75   | ) |                                                     |   |        
|                                                            |  |                               |          |   |                                                     |   |         
|Net Investment Loss                                         |  |                               | (37.89   | ) |                                                     |   |        
|                                                            |  |                               |          |   |                                                     |   |         
|Net Loss per Unit                                           |  |                               | (6.79    | ) |                                                     |   |        
|                                                            |  |                               |          |   |                                                     |   |         
|Net Asset Value per unit at the end of the period           |  | $                             | 993.20   |   |                                                     | $ | 1,000.00
|                                                            |  |                               |          |   |                                                     |   |         
|Net investment loss as a percentage of Partners Capital(3) |  |                               | -5.77    | % |                                                     |   |         
|                                                            |  |                              
|Expenses as a percentage of Partners Capital(3)            |  |                               | -9.69    | % |                                                     |   |         
|                                                            |  |                              
|Total return(2)(4)                                          |  |                               | -0.68    | % |                                                     |   |         

This information has been derived from information presented in the preceding financial
statements. The above ratios were calculated for the partners taken as a whole. The computation of such ratios was not based on the amount of expenses assessed and income allocated to an individual partners capital account, which may vary from
these ratios based on the timing of capital transactions and different fee arrangements (see Notes to the Financial Statements Note 2).



---

|(1) | For the period from May 16, 2005 (commencement of operations) to December 31, 2005,
including certain one time expenses incurred during the initial operating period for the Partnership.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The Partnerships operations did not commence until May 16, 2005 and as such there
were no operations or changes in partners capital for the period April 12, 2004 through December 31, 2004.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Annualized for the period from May 16, 2005 (commencement of operations) to
December 31, 2005.
|--- | ----------------------------------------------------------------------------------------------

|(4) | Not annualized.
|--- | ---------------

See Notes to the Financial Statements.



23



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Notes to the Financial Statements as of December 31, 2005 and

December 31, 2004 (Unaudited)

Note 1: Nature of Operations and Significant Accounting Policies

Nature of Operations:The Beacon Financial Futures Fund, L.P. (a Delaware limited partnership) (the Partnership) was organized on April 6, 2004 to engage in speculative trading of a diversified
portfolio of commodity interests including futures, options on futures and forward contracts. The Partnerships limited partnership agreement provides, among other things, that the Partnership shall dissolve no later than December 31,
2052. Beacon Management Corporation, the general partner of the Partnership (the General Partner), is registered as a commodity pool operator and commodity trading advisor with the National Futures Association (the NFA), an
industry self regulatory organization. UBS Securities and Man Financial, Inc. will initially serve as the Partnerships clearing brokers. The General Partner conducts and manages the business of the Partnership. The General Partner is also the
commodity trading advisor of the Partnership. The General Partner made an investment in the Partnership equal to, and will maintain its interest in, the capital of the Partnership at no less than the greater of: (a) 1% of the total investments
in the Partnership by all Partners and (b) $25,000. These contributions by the General Partner need not exceed the amount described above and are evidenced by units of General Partnership Interest (Unit(s) of General Partnership
Interest). The Partnership was initially capitalized by the General Partner on April 12, 2004 through the contribution of $1,000 in exchange for one unit of Partnership interest. The General Partner and each limited partner will share in
the profits and losses of the Partnership in proportion to their respective ownership interests. On March 30, 2005, the General Partner made an additional contribution of $999,000 in exchange for 999 units of partnership interest. The
Partnership commenced operations on May 16, 2005. On August 31, 2005, the General Partner redeemed $14,505 of its investment in the Partnership and on September 30, 2005, the General Partner redeemed $488,802 of its investment in the
Partnership. During the period from April 6, 2004 (date of organization) to December 31, 2004, the General Partner deposited $37,340 with the Partnership for the Partnerships SEC and NASD registration fees. The fees actually incurred
related to these registrations were $36,029 and at December 31, 2004, $1,311 was due from the Partnership to the General Partner. As a commodity investment pool, the Partnership is subject to the regulations of the Commodity Futures Trading
Commission, an agency of the United States (U.S.) government, which regulates most aspects of the commodity futures industry; rules of the NFA; and the requirements of commodity exchanges and Futures Commission Merchants (brokers) through which the
Partnership trades. As a registrant with the Securities and Exchange Commission, the Partnership is subject to the regulatory requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934.

Significant Accounting Policies:The following are the significant accounting policies of the Partnership.

Use of EstimatesThe preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

ValuationThe majority of the Partnerships positions are exchange-traded futures contracts, which are valued daily at settlement prices published by the exchanges. Any spot and forward foreign currency contracts held by
the Partnership are valued at published daily settlement prices or at dealers quotes.

Deposits with BrokersThe Partnership deposits
funds with brokers subject to Commodity Futures Trading Commission regulations and various exchange and broker requirements. Margin requirements are satisfied by the deposit of cash with such brokers. The Partnership earns interest income on its
cash deposited with the brokers.

Income RecognitionPurchases and sales of futures, options on futures, and forward contracts are recorded on
the trade date, and open contracts are reflected at market value with the change in unrealized gains (losses) from one period to the next recorded in the statement of operations. Gains or losses are realized when contracts are liquidated. The
specific contracts liquidated are determined by the clearing broker (in most cases on a FIFO basis). Net unrealized gains or losses on open contracts (the difference between contract trade price and quoted market price) are reflected in the
statement of financial condition. Brokerage commissions include other trading fees and are charged to expense when contracts are opened.



24



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Notes to the Financial Statements as of December 31, 2005 and

December 31, 2004 (continued)



Net Asset Value for purposes of both financial reporting and calculation of redemption value, the net asset
value of a unit is an amount equal to the Partnerships net assets allocated to capital accounts represented by units, divided by the number of units outstanding. Net assets means the total assets of the Partnership, including
all cash and cash equivalents, accrued interest and amortization of original issue discount, and the market value of all open futures contracts, options on futures contracts, forward contracts, and other assets of the Partnership, less the total
liabilities of the Partnership, including, but not limited to, brokerage, incentive allocations, management fees, interest payable and extraordinary expenses.

Escrow Accounts ReceivableRepresents deposits from escrow agent.

Organization and Offering ExpensesOrganizational and Offering costs were paid by Uhlmann Price Securities, LLC (the Selling Group Manager) and
the General Partner. The Selling Group Manager and the General Partner will not be reimbursed by the Partnership for such costs.

Income
TaxesThe Partnership is a partnership for federal income tax purposes and Partnership income or loss will be includable in the income tax returns of the individual partner.

Note 2: Unit Transactions

Limited partners may purchase units of the Partnership upon approval by the General
Partner at the net asset value, as of the last day of each month or on any other date as determined by the General Partner. After holding the units for eleven months, limited partners may require the Partnership to redeem some or all of their units
at the net asset value, as of the last day of each month without a redemption charge. Any units redeemed before the holder has been a limited partner for six months will be assessed a redemption charge equal to 4 percent of the net asset value per
unit on the date of such redemption and units redeemed after six but within eleven months will be assessed a 3 percent redemption charge. Redemption charges will be paid by the redeeming limited partner to the General Partner. Unpaid withdrawals are
considered redemptions payable.

Note 3: Partnership Fees and Expenses

Fixed Asset Fee:The Partnership pays the General Partner a fixed, monthly Fixed Asset Fee of 0.525%, or 6.30% annually, of the Partnerships monthly net asset value. Out of this Fixed Asset Fee, the
General Partner pays all introducing, initial and ongoing servicing fees, management fees, trading advisory fees and any other transaction costs of the Partnership except brokerage fees, NFA, exchange and clearing fees, which are paid separately by
the partnership and are estimated at 0.50% annually of net asset value. The General Partner retains any excess amount. Included in the Fixed Asset Fee are the following amounts that are earned by the General Partner and Uhlmann Price Securities,
LLC, the Selling Group Manager.



| |  |  | Management Feepaid monthly to the General Partner at a rate of 1/12thof 1.3% of the Partnerships monthly net asset value.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------



| |  |  | Trading Advisory Feepaid monthly to the General Partner at a rate of 1/12thof 2.0% of the Partnerships monthly net asset value.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



| |  |  | Selling Agent Service Feefee to compensate distributors of the units for the Partnership for costs incurred in the distribution of Partnership units. Such distribution costs
may include commissions, payments to sales agents, promotional materials, overhead allocations and interest. The selling agent service fee is paid monthly by the Partnership at a rate of 1/12thof 3% of the Partnerships monthly net asset value. For the first 12 months after the sale of such units, the selling agent service fee is paid monthly by
the Partnership to the General Partner, as reimbursement to the General Partner for amounts advanced by the General Partner to the selling agent at the time of the sale of such units. Commencing with the 13thmonth after the sale of such units, the selling agent service fee is paid to the selling agent.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



25



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Notes to the Financial Statements as of December 31, 2005 and

December 31, 2004 (continued)



Incentive Fees: The Partnership makes an incentive allocation equal to 20% of trading profits to the capital
account of the General Partner each quarter. Trading profits means the net new profits (realized and unrealized), excluding interest income, decreased by monthly Fixed Asset Fee and other operating expenses that are chargeable to the
Partnerships net assets, with these trading profits and items of decrease determined from the end of the last period for which an incentive fee was earned. Extraordinary expenses of the Partnership, if any, are not deducted in determining
trading profits. If the Partnership makes an incentive allocation and the Partnership fails to earn new trading profits for any subsequent period, the General Partners capital account will retain the incentive allocation previously made.
However, the Partnership will not make any subsequent incentive allocation until these losses have been recovered and the Partnership has again earned new trading profits.

Other Operating Expenses: The Partnership pays all of its own direct legal, accounting, administrative, filing, reporting and data processing expenses. The Partnership will not pay more than 0.50% of net assets
in annual audit fees provided the Partnership has not issued more than $5 million in subscriptions. Any excess audit fees are reimbursed by the General Partner. As of December 31, 2005, accounts receivable includes $3,769 that is due from the
General Partner. In accordance with Section IV.C. of the NASAA Registration of Commodity Pool Programs, the Brokerage commissions of the Partnership may not exceed 14% of the Partnerships average monthly net assets, as of the last day of each
month during the calendar year. The General Partner will bear any fees in excess of these limitations.

Note 4: Financial Instruments with
Off-Balance-Sheet Risk

The Partnerships trading activities involve derivative financial instruments, primarily futures, options on futures, and
forward contracts, which have market and/or credit risk. Purchase and sale of futures contracts require margin deposits with the brokers. Additional deposits may be necessary for any loss on contract value. The Commodity Exchange Act requires a
broker to segregate all customer transactions and assets from such brokers proprietary activities. A customers cash and other property (for example, U.S. Treasury bills) deposited with a broker are considered commingled with all other
customer funds subject to the brokers segregation requirements. In the event of a brokers insolvency, recovery may be limited to a pro rata share of segregated funds available. It is possible that the recovered amount could be less than
total cash and other property deposited.

Market Risk:Market risk arises primarily from changes in the market value of financial instruments.
Generally, the Partnerships exposure is equal to the notional value of futures contracts purchased and unlimited on such contracts sold short. As both a buyer and seller of options on futures, the Partnership pays or receives a premium at the
outset and then bears the risk of unfavorable market variations underlying the option. The risk of loss for purchased options on futures is limited to the premiums paid; written or sold options on futures expose the Partnership to potentially
unlimited liability. Exposure to market risk is be influenced by a number of factors, including the relationships between financial instruments, and the volatility and liquidity in the markets in which the financial instruments are traded. In many
cases, the use of financial instruments may serve to modify or offset market risk associated with other transactions and, accordingly, may serve to decrease the Partnerships overall exposure to market risk. The Partnership attempts to control
its exposure to market risk through various analytical monitoring techniques.

Credit Risk: Credit risk arises primarily from the potential
inability of counterparties to perform in accordance with the terms of a contract. The Partnerships exposure to credit risk associated with counterparty nonperformance is limited to the current cost to replace all contracts in which the
Partnership has a gain. Exchange-traded financial instruments generally does not give rise to significant counterparty exposure due to the case settlement procedures for daily market movements and the margin requirements of individual exchanges. The
net unrealized gain on open futures contracts is comprised of the following:



|                        |  |                                                     |         |  
|----------------------- |  | --------------------------------------------------- | ------- | -
|                        |  | Futures Contracts(exchange traded)December 31, 2005 |        
|Gross unrealized gains  |  | $                                                   | 16,291  |  
|Gross unrealized losses |  |                                                     | (14,105 | )
|                        |  |                                                     |         |  
|Net unrealized gain     |  | $                                                   | 2,187   |  
|                        |  |                                                     |         |  



26



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##### Table of Contents

The Beacon Financial Futures Fund, L.P.

Notes to the Financial Statements as of December 31, 2005 and

December 31, 2004 (continued)



Open contracts generally mature within three months; as of December 31, 2005, the latest maturity date for open
futures contracts is March 2006.

Concentration of Credit Risk: The Partnership will use Man Financial Inc. and UBS Securities as clearing brokers
(Clearing Brokers). In the event these Clearing Brokers do not fulfill their obligations, the Partnership may be exposed to risk. This risk of default depends in part on the creditworthiness of these Clearing Brokers. The Partnership
will attempt to minimize this credit risk by monitoring the creditworthiness of the Clearing Brokers. The General Partner has established procedures to actively monitor market risk and minimize credit risk, although there can be no assurance that it
will, in fact, succeed in doing so. The Limited Partners bear the risk of loss only to the extent of the market value of their respective investments and, in certain specific circumstances, distributions and redemptions received. The amount of
required margin and good faith deposits with the Clearing Brokers usually range from 9% to 17% of net asset value. As of December 31, 2005, the Partnership maintained broker cash balances of $1,022,740 to satisfy such requirements, which equals
94% of net asset value.

Note 5: Guarantees

In the
normal course of business, the Partnership may enter into contracts and agreements that contain a variety of representations and warranties and which provide general indemnifications. The Partnerships maximum exposure under these arrangements
cannot be estimated. However, the Partnership believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any contingent liability in the financial statements for such indemnifications.



27



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##### Table of Contents

EXHIBIT INDEX



|               |  |                                          |  |            
|-------------- |  | ---------------------------------------- |  | -----------
|Exhibit Number |  | Description of Document                  |  | Page Number
|31.01          |  | Certification by Chief Executive Officer |  | E1         
|32.01          |  | Certification by Chief Executive Officer |  | E2         



28