UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                              ____________________

                                    FORM 10-K
(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, 2003

                                       OR

/ /          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                For the transition period from _______ to _______

                         Commission file number 0-21874

                           Berkeley Technology Limited
             (Exact name of registrant as specified in its charter)
                             ______________________


        Jersey, Channel Islands                         Not applicable
   (State or other jurisdiction             (I.R.S. Employer Identification No.)
  of incorporation or organization)

                          Minden House, 6 Minden Place
                           St. Helier, Jersey JE2 4WQ
                                 Channel Islands
          (Address of principal executive offices, including zip code)

                              011 44 (1534) 607700
              (Registrant's telephone number, including area code)


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

           Securities registered pursuant to Section 12(g) of the Act:

                                                      Name of each exchange on
            Title of each class                           which registered
      American Depositary Shares, each                          None
     representing ten Ordinary Shares of
          $0.05 par value per share
 Ordinary Shares of $0.05 par value per share*

*Not for  trading,  but only in  connection  with the  registration  of American
Depositary  Shares,  pursuant to the requirements of the Securities and Exchange
Commission.

     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 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  III of this  Form  10-K or any
amendment to this Form 10-K. [ |X|]

     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2). Yes [ ] No [ |X|]

     The aggregate  market value of the voting stock held by  non-affiliates  of
the  registrant,  based on the closing sale price of the Ordinary Shares on June
30, 2003 as reported on the London  Stock  Exchange  (using an exchange  rate of
(pound)1.00  = $1.65)  was  $6,443,975.  Ordinary  Shares  held by each  current
executive officer and director and by each person who is known by the registrant
to own 5% or more of the  outstanding  Ordinary  Shares have been  excluded from
this  computation  in that such  persons may be deemed to be  affiliates  of the
registrant.  This determination is not necessarily conclusive that these persons
are affiliates of the registrant.

     As of February 27, 2004, the registrant had outstanding 64,439,073 Ordinary
Shares, $0.05 par value per share.

                       DOCUMENTS INCORPORATED BY REFERENCE

     The registrant's  definitive proxy statement for its Annual General Meeting
of  Shareholders  to be held on August 4, 2004, is incorporated  by reference in
Part III of this Form 10-K.

<PAGE>
<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

                                      PART I                                                           Page

<S>                                                                                                     <C>
Item 1.    Business ..................................................................................    1
Item 2.    Properties ................................................................................    6
Item 3.    Legal Proceedings .........................................................................    6
Item 4.    Submission of Matters to a Vote of Security Holders .......................................    6


                                     PART II

Item 5.    Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases
               of Equity Securities...................................................................    7
Item 6.    Selected Financial Data ...................................................................   11
Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations .....   12
Item 7A.   Quantitative and Qualitative Disclosures About Market Risk ................................   25
Item 8.    Financial Statements and Supplementary Data ...............................................   27
Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure ......   74
Item 9A.   Controls and Procedures....................................................................   74


                                    PART III

Item 10.   Directors and Executive Officers of the Registrant ........................................   75
Item 11.   Executive Compensation ....................................................................   75
Item 12.   Security Ownership of Certain Beneficial Owners and Management and Related
               Stockholder Matters....................................................................   75
Item 13.   Certain Relationships and Related Transactions ............................................   76
Item 14.   Principal Accountant Fees and Services.....................................................   76


                                     PART IV

Item 15.   Exhibits, Financial Statement Schedules and Reports on Form 8-K ...........................   76

Signatures ...........................................................................................   87
Exhibit Index ........................................................................................   88
</TABLE>
<PAGE>



     As used herein,  the terms  "registrant,"  "Company,"  "we," "us" and "our"
refer to Berkeley  Technology  Limited  (formerly London Pacific Group Limited).
Except as the context otherwise  requires,  the term "Group" refers collectively
to the registrant and its subsidiaries.

Forward-Looking Statements and Factors That May Affect Future Results

     Statements  contained  in this  Annual  Report  on Form  10-K  that are not
historical  facts,  including,  but not limited to,  statements  found in Item 1
"Business," Item 7 "Management's  Discussion and Analysis of Financial Condition
and Results of Operations" and Item 7A "Quantitative and Qualitative Disclosures
About Market Risk," are forward-looking statements within the meaning of Section
21E of the  Securities  Exchange Act of 1934, as amended (the  "Exchange  Act").
Such forward-looking  statements are based on current  expectations,  estimates,
forecasts and projections about the industries in which we operate, management's
current  beliefs and  assumptions  made by management.  Words such as "expects,"
"anticipates,"  "intends," "plans," "believes," "seeks,"  "estimates,"  "goals,"
variations of such words and similar  expressions  are intended to identify such
forward-looking  statements.  These  statements  are not  guarantees  of  future
performance and involve certain risks,  uncertainties  and assumptions  that are
difficult to predict.  Future  outcomes and results may differ  materially  from
what is expressed or forecasted in such forward-looking statements. We undertake
no obligation to update any forward-looking  statements,  whether as a result of
new information, future developments or otherwise.


                                     PART I

Item 1.    BUSINESS

OVERVIEW

     We are a  financial  services  company  based in Jersey,  Channel  Islands,
specializing in venture capital and consulting.

     We evolved from a financial  consulting  business,  The Berkeley Consulting
Group,  formed in 1977. That business focused on financial  consulting  services
and venture  capital  finance for U.S. high  technology  companies from non-U.S.
institutional financing sources. The Company was incorporated in 1985 in Jersey,
Channel  Islands.  We obtained a listing on the London Stock Exchange ("LSE") in
that same year and our Ordinary Shares currently trade under the symbol "BEK.L."
Since  1985,  we grew  with the  establishment  of life  insurance  and  annuity
businesses  in both  the  U.S.  and  Jersey,  and  through  acquisitions  in the
financial  advisory  services  and  asset  management  areas.  In 2002,  we lost
management  control of the U.S. life  insurance  business due to the dilution in
the level of the life insurance  company's  capital arising from bond and equity
losses in poor market  conditions.  We continue to service the  policyholders of
London Pacific Assurance  Limited ("LPAL") in Jersey,  but new policies were not
sold in 2003 to avoid  the  capital  requirements  related  to the  sales of new
policies.  In 2003, we sold two of our operating  businesses:  Berkeley  Capital
Management  ("BCM"), a U.S. based asset management  company;  and London Pacific
Advisory  Services,  Inc.  and  its  affiliates  ("LPA"),  a U.S.  based  online
investment  consulting service. We now focus on our venture capital business. We
are working with North American private technology companies that are looking to
grow their  businesses and to expand their investor base overseas,  primarily in
Europe and Japan.

     American  Depositary  Receipts  ("ADRs")  representing  our Ordinary Shares
began  trading in the U.S.  market in 1992.  We obtained a listing on The Nasdaq
Stock  Market SM in 1993 and in  November  1999  migrated  to the New York Stock
Exchange ("NYSE") where our ADRs traded under the symbol "LDP." During 2002, our
ADR price fell below the minimum  required by the NYSE;  consequently,  our ADRs
were withdrawn from listing and  registration on the NYSE. Our shares  currently
trade  on  the   Over-the-Counter   ("OTC")  Bulletin  Board  under  the  symbol
"BKLYY.PK."

     During the first quarter of 2000, we completed a four-for-one  split of our
American  Depositary  Shares  ("ADSs").  Effective from the close of business on
March 23,  2000,  each ADS,  evidenced by an ADR,  equaled

                                       1
<PAGE>


one  Ordinary  Share.  During  the  second  quarter  of  2002,  we  completed  a
one-for-ten reverse split of our ADSs. Effective from the opening of business on
June 24, 2002, each ADS represents ten Ordinary Shares.

     We currently  have offices in Jersey  (Channel  Islands) and San Francisco,
California.

BUSINESS SEGMENTS

     We  currently  have two  business  segments  that we  operate  through  our
subsidiaries:  life insurance and annuities, and venture capital and consulting.
Our principal operating subsidiaries,  by business segment and location, are set
forth below:
<TABLE>
<CAPTION>

      Principal Subsidiaries                     Business Segment                  Location
------------------------------------------       -------------------------         -------------------------

<S>                                              <C>                               <C>
London Pacific Assurance Limited                 Life insurance and annuities      Jersey, Channel Islands
Berkeley International Capital Corporation       Venture capital and consulting    San Francisco, California
Berkeley International Capital Limited           Venture capital                   Guernsey, Channel Islands
</TABLE>

     See the  "Overview"  section above for a description of the main changes to
our business segments. We used the proceeds received at the closing of the sales
of BCM and LPA to repay our bank facility  which was due and payable  during the
course of 2003.

     See Item 7 "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Results of  Operations by Business  Segment" and Note 21
to the  Consolidated  Financial  Statements  in Item 8 of this  Form  10-K for a
summary of our  financial  information  by  business  segment  and  geographical
location.

Life Insurance and Annuities

     Our U.S. life  insurance  company,  London  Pacific Life & Annuity  Company
("LPLA"),  was established in 1989 and provided tax advantaged annuity products.
By the end of 2001, LPLA grew to approximately $2.3 billion in assets;  however,
during 2002, the life insurance and annuities  segment suffered from the adverse
conditions in the bond and equity  markets.  On July 2, 2002, we announced  that
further declines in the value of LPLA's investment portfolio,  due to persistent
negative events in the equity and bond markets, continued to erode significantly
the  statutory  capital of LPLA and that we were  unsuccessful  in  concluding a
transaction to enhance the capital of LPLA. Subsequently,  LPLA was placed under
regulatory  control and  rehabilitation  based on LPLA's  statutory  capital and
surplus as of June 30, 2002. On August 6, 2002, on petition of the  Commissioner
of  Insurance  of the  State of North  Carolina  (the  "Commissioner")  with the
consent of LPLA and unanimous  approval of its board of directors,  the Superior
Court of Wake County in the State of North Carolina  ordered the Commissioner to
take  possession  and  control  of all  of the  property,  books  and  accounts,
documents  and other  records of LPLA.  Based on this court order,  we no longer
exercise  control over LPLA. As a result of this event, we  deconsolidated  LPLA
and recorded a charge to earnings in 2002 of $38.5 million for losses  resulting
from this disposition.

London Pacific Assurance Limited

     Formed in 1999, our Jersey, Channel Islands insurance subsidiary, LPAL, has
principally  been  engaged  in  marketing  and  servicing   investment  oriented
insurance products.  LPAL sold Sterling,  U.S. dollar and Euro guaranteed return
bonds in its home market of Jersey,  Channel Islands, and in the U.K., Guernsey,
Isle of Man and other  permitted  jurisdictions.  The  products  guarantee  both
capital and yield for the duration of the investment period, which are typically
three or five years.  From LPAL's start of  operations  in the first  quarter of
2000  through the end of June 2002,  LPAL  generated  premiums  totaling  $135.0
million.  LPAL  generated  sales  directly to the public and  through  financial
intermediaries in the Channel Islands, U.K., Isle of Man and other international
locations.

     On July 2, 2002,  we  announced  that LPAL would  discontinue  writing  new
policies  effective  immediately.  The decision to  discontinue  the issuance of
policies  was  made to avoid  the  increased  capital  requirements  created  by
additional policyholder  liabilities.  Subsequent to this announcement and other
announcements


                                       2
<PAGE>

relating   to  the  Company  and  LPLA,   LPAL   policy   surrenders   increased
substantially.  The number of policyholders  fell from 2,603 at June 30, 2002 to
684 at December  31,  2003.  The primary  financial  impact of the high level of
surrenders  has been the  reduction in the level of capital  required to support
the policyholder liabilities.

     LPAL has over 200 sales agreements in place with financial  intermediaries,
giving the company  access to a large number of independent  financial  advisers
("IFAs")  throughout  the U.K.  and the  Channel  Islands.  However,  if  LPAL's
management decides to sell policies in the future, it is not clear how many IFAs
in the network will sell LPAL policies  again due to the negative  announcements
regarding  LPLA in the U.S.  Inevitably,  the high level of  surrenders  and the
discontinuation  of policy  issuances  will also have a negative  impact on this
segment. Policy administration, previously handled for a fee by LPLA in Raleigh,
North Carolina, was transferred to our Jersey office in July 2003.

Investment Portfolio

     In turbulent market  conditions,  LPAL's  portfolio  strategy has sought to
match the level of  policyholder  liabilities  with corporate bonds and cash. On
December 31, 2003,  policyholder  liabilities  amounted to $28.1 million and the
market value of LPAL's corporate bonds,  cash,  accrued interest and amounts due
from brokers amounted to $30.2 million.  In addition,  LPAL's portfolio included
listed  equities  valued at $13.5  million and private  equities  valued at $4.2
million at December 31, 2003.

     See Item 7 "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Life Insurance and Annuities" for additional information
on  LPAL's  investment  portfolio  and its  effect on the  profitability  of the
insurance segment.

Competition

     LPAL operates in a highly competitive environment. The industry consists of
a large number of  companies,  many of which have greater  financial  resources,
more  diversified  product  lines  and  larger  staffs  than  those of LPAL.  An
expanding  number of other financial  services  companies also market  insurance
products  or offer  competing  products.  Competition  is  based on a number  of
factors,  including  product  pricing,  service  provided  to  distributors  and
policyholders, and ratings.

     We believe  LPAL  could  compete  again in the future but its  distribution
capability may be significantly  weakened due to the ongoing  discontinuation of
sales activity,  as well as the negative  publicity  associated with the loss of
management  control of LPLA. LPAL has had little  pro-active  contact with sales
agents since the decision to discontinue issuing policies.

Venture Capital and Consulting

     Berkeley   International   Capital   Corporation   ("BICC")   and  Berkeley
International   Capital  Limited  ("BICL")  comprise  our  venture  capital  and
consulting  business.  In recent years,  our venture capital  subsidiaries  have
focused primarily on U.S. high technology companies,  with investments generally
ranging from $5 million to $25 million.

     Subsequent to the rehabilitation proceedings involving LPLA in August 2002,
we have not made any venture  capital  investments.  However,  we are  presently
developing a new venture  capital  investment  strategy.  Some progress has been
made at BICC in advising a small number of North American  technology  companies
which is the first  step  towards  taking  principal  positions  selectively  in
technology companies.

Berkeley International Capital Corporation

     BICC is primarily  responsible  for our  activities in the venture  capital
area.  Currently,  this involves working with North American private  technology
companies that are looking to grow their businesses and to expand their investor
base overseas,  primarily in Europe and Japan. We advise on overseas operations,


                                       3
<PAGE>

assist in locating  investment  capital  and  occasionally  will take  principal
positions where the case is compelling and the timeframe for  realization  could
be relatively short.

     Typically,  BICC seeks a retainer  (monthly  or  upfront  depending  on the
nature of the assignment) from its U.S. private  technology  company clients for
its consulting  work, and a "success fee" upon the successful  conclusion of its
assignment.  The consulting work may involve  assistance in the preparation of a
business plan; market research; strategy development; identification of investor
prospects;  introductory meetings with prospective  customers or investors;  and
assistance in the implementation of the chosen strategy or transaction.

     BICC provides its services  currently to a small number of clients,  and is
in discussions  with additional  prospects.  As an example of its work, BICC has
been  engaged  by a North  American  telecommunications  company  to  develop  a
business  strategy for penetration of the Western and  Central/Eastern  European
markets.  This engagement has involved  detailed  market and prospect  research,
preparation of a business plan and meetings with potential clients that may lead
to substantial  business for the client company.  Another example of BICC's work
is an  engagement  involving  the  preparation  of a  business  plan,  reviewing
financing  structures  and  introducing  investors  who  could  finance  a major
European research and development,  sales and customer support initiative for an
electronic design automation company.

     BICC has a long history and experience in both the U.S. technology industry
and the overseas  investment  and business  markets.  It is well  positioned  to
benefit from the globalization  forces that are at work in the industry and that
are challenging so many young technology companies. It can also provide overseas
investors  and  businesses  with the  access  they  desire  to U.S.  businesses,
technologies and potential sources of funding.

     Over the past 24 years,  BICC  arranged  over $1.9 billion of placements in
the private capital markets.  Placements were typically  arranged in later stage
technology companies,  which were near alpha test of their product and needed to
scale up their  engineering,  marketing  and sales  infrastructure.  Within this
strategy,  BICC  has been  able to  identify  many  promising  young  technology
companies  that  have  grown  in  prominence  in  their  fields  and  gone on to
successful public offerings or acquisition  transactions.  Many of the companies
are  headquartered  in close proximity to BICC's offices which allows for easier
access to the  companies'  management.  Most of these  companies  specialize  in
"business-to-business"  Internet technologies,  telecommunications (both central
office and customer premises), data communications, software, semiconductors and
knowledge  learning.  These placements  included  investments in America Online,
Oracle Corporation,  Cadence Design Systems, Inc., Cypress Semiconductor,  Inc.,
Packeteer, Inc. and New Focus, Inc.

     The private technology  investments  arranged by BICC and currently held by
LPAL are Agility Communications, Inc. and Alacritech, Inc.

     Due to the loss of control of LPLA in 2002,  BICC no longer  receives  fees
from LPLA.  Fees earned by BICC from LPLA during 2002 and 2001 were $2.9 million
and $9.9 million, respectively.

Berkeley International Capital Limited

     BICL,  formed  in 1988  and  based  in  Guernsey,  Channel  Islands,  takes
principal positions in connection with private equity  transactions  arranged by
its sister  company,  BICC.  These  private  equity  positions may become listed
equity securities  pursuant to IPOs or in connection with the acquisition of the
private issuing company by a listed company.  As of December 31, 2003, BICL held
$3.4 million of such positions in listed equity securities.

Competition

     Our venture capital  business faces  competition  primarily from commercial
banks, investment banks, venture capital firms and insurance companies,  many of
which have  substantially  greater  financial  resources.  The  marketplace  for
venture  capital  is  highly  competitive,  and  demand  for  financing  is also
influenced by

                                       4
<PAGE>

economic and stock market conditions.  The pool of capital seeking opportunities
to invest in later stage technology  companies contracted further in 2003 but we
believe demand continues for high value technology companies.

Discontinued Operations

Berkeley Capital Management

     On May 7, 2003,  we completed the sale of  substantially  all of the assets
and operations of BCM to a company  majority-owned by funds under the management
of Putnam Lovell NBF Private  Equity.  BCM was our asset  management  subsidiary
based in San Francisco,  California, managing equity, balanced and bond accounts
for  institutional  clients  and for the wrap fee  programs  of major  brokerage
houses.   At  the  time  of  the  sale,   BCM's  assets  under  management  were
approximately $1.2 billion.

London Pacific Advisors

     On June 5, 2003, we completed the sale of all of the  outstanding  stock of
London Pacific Advisory Services, Inc., London Pacific Securities,  Inc. and LPA
Insurance  Agency,  Inc.  together  with the  associated  assets of the advisory
business held within London  Pacific  Technologies,  Inc. and LP Advisors,  Inc.
(collectively,  "LPA"). LPA provided web-based investment consulting, investment
management and back-office services to independent  financial advisors and large
institutional  clients.  At the time of the sale, LPA's assets under management,
consulting or administration were approximately $2.6 billion.

REGULATION

Life Insurance and Annuities - London Pacific Assurance Limited

     LPAL is regulated by the Jersey  Financial  Services  Commission  ("JFSC").
Under Article 6 of the Insurance  Business  (Jersey) Law 1996, LPAL is permitted
to conduct  long-term  insurance  business.  LPAL is required  to submit  annual
audited financial  statements  (prepared under United States generally  accepted
accounting principles as permitted by regulation),  and an audited annual filing
to the  JFSC in the  format  consistent  with  that  required  by the  Financial
Services  Authority in the United Kingdom.  The annual filing  submitted by LPAL
must be  accompanied by a Certificate  from the Appointed  Actuary that based on
sufficiently   prudent   assumptions,   assets  are   sufficient  to  cover  all
liabilities.  The annual filing contains a report from the Appointed  Actuary on
the matching of investments to liabilities.

     The JFSC sets out the conditions with which LPAL must comply and determines
the reporting  requirements  and the frequency of  reporting.  These  conditions
require that: (i) LPAL must hold, at all times,  approved  assets at least equal
to the long-term  insurance fund plus the required minimum solvency margin, (ii)
the margin of solvency must be the greater of (pound)50,000 or 2.5% of the value
of the long-term  business  fund, and (iii) assets equal to not less than 90% of
liabilities must be placed with approved independent custodians.  As of December
31, 2003, LPAL met all of these conditions.

     LPAL is also required under the insurance  laws to appoint an actuary.  The
actuary must be qualified as defined under the laws and is required to supervise
the long-term insurance fund. No transfers,  except in satisfaction of long-term
insurance  business  liabilities,  including  dividends,  are permitted from the
long-term insurance fund without written consent from the actuary.

Group

     We employ  compliance  officers  responsible for managing our subsidiaries'
compliance  with  applicable  regulatory  requirements.  Although  the  scope of
regulation  and form of supervision to which our  subsidiaries  are subject,  as
described above, may vary from jurisdiction to jurisdiction, the applicable laws
and  regulations  often are complex and  generally  grant  broad  discretion  to
supervisory  authorities  in  adopting  regulations  and  supervising  regulated
activities.  Our continuing ability to engage in businesses in the jurisdictions
in which our  subsidiaries  currently  operate is dependent upon compliance with
the  rules and  regulations  promulgated  from

                                       5
<PAGE>

time to time by the appropriate authorities in each of these jurisdictions.  The
burden  of such  regulation  weighs  equally  upon  all  companies  carrying  on
activities  similar to those of our  subsidiaries,  and we do not consider  such
regulations to adversely affect the competitive position of our subsidiaries.

EMPLOYEES

     As of December 31, 2003,  we had 15  employees.  The  breakdown by business
segment was as follows:  venture capital and  consulting,  6; life insurance and
annuities,  4; and corporate,  5. None of the Group's employees are covered by a
collective  bargaining  agreement  and the  Group has not  experienced  any work
stoppages.


Item 2.    PROPERTIES

     We currently  operate from two offices located in Jersey (Channel  Islands)
and San  Francisco,  California,  consisting of  approximately  3,000 and 14,000
square feet,  respectively.  We lease both offices,  and sublease  approximately
one-third of the San  Francisco  office space to an  unaffiliated  party.  These
leases expire in September 2010 and April 2004, respectively. Our life insurance
and  annuities  segment  operations,  as  well  as  our  head  office  corporate
activities,   are  carried  out  in  the  Jersey  office.  Our  venture  capital
operations, as well as our U.S. corporate activities, are carried out in the San
Francisco office. The San Francisco office is too large for our current level of
business and staffing,  and as our lease expires in April 2004, we are currently
evaluating alternative office space in San Francisco.

     See  Note 15 to the  Consolidated  Financial  Statements  in Item 8 of this
Form 10-K for further information regarding our leases.


Item 3.    LEGAL PROCEEDINGS

     On August 6, 2002,  on petition of the  Commissioner  of  Insurance  of the
State of North  Carolina  (the  "Commissioner"),  with the  consent  of LPLA and
unanimous approval of its board of directors,  the Superior Court of Wake County
in the State of North Carolina  ordered the  Commissioner to take possession and
control of all the property, books and accounts,  documents and other records of
LPLA. LPLA and its officers,  directors, agents, employees and all other persons
were  enjoined from  disposing of LPLA's  property and from  transacting  LPLA's
business  except with the consent of the  Commissioner.  The Court appointed the
Commissioner as  rehabilitator  of LPLA.  Based on the court order, we no longer
exercise control over LPLA.

     For further information see Item 1 above.

     We were involved in various legal proceedings, including claims for damages
from LPA clients of a nature we consider  to be normal for LPA's  business.  All
proceedings  against  LPA  were  resolved  prior  to the  end of  January  2004,
resulting in no claims paid or to be paid by us.


Item 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were  submitted  to our  shareholders  during the quarter  ended
December 31, 2003.

                                       6
<PAGE>



                                     PART II

Item 5. MARKET FOR REGISTRANT'S  COMMON EQUITY,  RELATED STOCKHOLDER MATTERS AND
        ISSUER PURCHASES OF EQUITY SECURITIES

MARKET INFORMATION

     The principal  trading market for our Ordinary Shares is the LSE, under the
symbol "BEK.L," on which such shares have been listed since February 1985. ADSs,
each representing ten Ordinary Shares,  are evidenced by ADRs for which The Bank
of New York is the  Depositary.  Our ADSs have traded in the United  States from
September  1992 through  August 1993 on the OTC Bulletin  Board,  from September
1993  through  November  1999 on The  Nasdaq  Stock  Market SM under the  symbol
"LPGL,"  from  November  1999  through July 3, 2002 on the NYSE under the symbol
"LDP," from July 12, 2002 through June 15, 2003 on the OTC Bulletin  Board under
the symbol  "LDPGY.PK"  and since June 16, 2003 on the OTC Bulletin  Board under
the symbol  "BKLYY.PK." As of December 31, 2003, there were 64,439,073  Ordinary
Shares  outstanding  and 1,504,501  ADSs  outstanding,  representing  15,045,010
Ordinary Shares or 23.3% of the  outstanding  Ordinary  Shares.  ADS holders may
exercise their voting rights through the ADR Depositary.

     In June 2002, we completed a one-for-ten reverse split of our ADSs. On June
24,  2002,  every ten of our ADSs  issued and  outstanding  were  converted  and
reclassified into one post-split ADS.  Consequently,  effective from the opening
of  business  on June  24,  2002,  each ADS is  equal  to ten  Ordinary  Shares.
Fractional new ADSs were sold by the Depositary Bank and paid in cash to the ADR
holders. This ADS split did not affect our Ordinary Shares listed on the LSE.

     On July 3, 2002,  the NYSE  halted  trading of our ADRs in  response to the
administrative  actions  taken by the North  Carolina  Department  of  Insurance
relating to LPLA.  On July 9, 2002,  trading of the ADRs was  suspended  and the
securities were withdrawn from listing and registration on the NYSE. As a result
of the delisting, the liquidity of our common stock and its price were adversely
affected. These actions may limit our ability to raise additional capital in the
future, and there is no assurance that a significant trading market for the ADRs
will develop.  If an active trading market does not develop,  ADR holders may be
unable to sell their ADRs.

     Subsequent to the delisting,  the ability of ADR holders to buy and sell is
limited to trading on the OTC Bulletin  Board.  Shares  traded on the OTC market
generally  experience  lower  trading  volume than those traded on the organized
exchanges.  The trading volume of the ADRs has decreased substantially since the
NYSE delisting and the transfer of the ADRs to the OTC Bulletin Board.

     The following table shows, for the quarters indicated, the reported highest
and lowest middle market quotations (which represent an average of bid and asked
prices) for our Ordinary  Shares on the LSE,  based on its Daily  Official List,
and the high and low trade price  information  of the ADSs as obtained  from the
NYSE through the second  quarter of 2002 and on the OTC Bulletin  Board from the
third quarter of 2002 (as restated to reflect the  one-for-ten  reverse split on
June 24, 2002):
<TABLE>
<CAPTION>

                                                                         LSE                 NYSE/OTC Bulletin Board
                                                                     Pounds Per                    U.S. Dollars
                                                                   Ordinary Share                     Per ADS
                                                               -----------------------        ----------------------
                                                                 High          Low              High          Low
                                                               ---------     ---------        ---------    ---------
2002:
<S>                                                                <C>          <C>             <C>           <C>
First quarter ................................................     3.08         1.93            45.50         27.50
Second quarter................................................     1.90         0.24            30.50          3.30
Third quarter.................................................     0.25         0.02             3.16          0.20
Fourth quarter................................................     0.13         0.05             1.75          0.50
</TABLE>


                                       7
<PAGE>

<TABLE>
<CAPTION>
                                                                         LSE                 NYSE/OTC Bulletin Board
                                                                     Pounds Per                    U.S. Dollars
                                                                   Ordinary Share                     Per ADS
                                                               -----------------------        ----------------------
                                                                 High          Low              High          Low
                                                               ---------     ---------        ---------    ---------
2003:
<S>                                                                <C>          <C>              <C>           <C>
First quarter ................................................     0.08         0.04             1.15          0.50
Second quarter................................................     0.16         0.08             2.50          1.00
Third quarter.................................................     0.17         0.11             2.60          1.45
Fourth quarter................................................     0.16         0.13             2.40          1.80
</TABLE>

Holders

     As of February 27, 2004, we had approximately  1,680 Ordinary  shareholders
of record and 59 ADS holders of record.  Because many  Ordinary  Shares and ADSs
are held by brokers and various  institutions on behalf of other holders, we are
unable to estimate the total number of beneficial  holders  represented by these
holders of record.

Dividends

     Until 2002, we paid dividends on our Ordinary Shares in every year since we
became  listed on the LSE in 1985.  Dividends on our  Ordinary  Shares were paid
twice a year.  In view of our  requirement  to conserve  cash during  periods of
market  instability  and in  order  to  meet  the  operating  needs  and  growth
opportunities  of the business,  we did not pay an interim or final dividend for
2002 or an  interim  dividend  for  2003.  Our  Board of  Directors  will not be
recommending a final dividend for the year 2003.

     Holders of ADSs are  entitled  to receive  dividends  paid,  if any, on our
Ordinary Shares through the ADR Depositary.

     Under  current  practice,  holders of ADSs who are  residents of the United
States for tax purposes  receive the net dividend  (the gross  dividend less the
associated Jersey income tax). See "Taxation - Taxation of Dividends" below.

     Currently,  Jersey  does  not have  exchange  control  restrictions  on the
payment of  dividends  on the  Ordinary  Shares or on the conduct of the Group's
operations.  See Note 11 to the Consolidated  Financial  Statements in Item 8 of
this Form 10-K for details regarding regulatory restrictions on dividends.

TAXATION

     The following summary of certain Jersey and U.S. tax consequences regarding
share ownership is based on law and published  practice as of February 27, 2004,
and is subject to any changes in Jersey and U.S. law or published practice or in
the establishment of any double taxation  convention between Jersey and the U.S.
occurring after that date. The summary is not a complete  analysis or listing of
all the possible tax  consequences and does not address the tax implications for
special classes of holders,  such as banks,  insurance  companies and dealers in
securities.   The  summary  also  does  not  address   U.S.   state  income  tax
consequences.  Owners of Ordinary  Shares and ADSs should  consult their own tax
advisors as to the tax consequences of such ownership.

     There is no double tax treaty or similar  convention  between the U.S.  and
Jersey.  For the purposes of the U.S. Internal Revenue Code of 1986, as amended,
it is assumed that  beneficial  owners of ADSs, in accordance  with the terms of
the Deposit Agreement,  will be treated as the owners of the underlying Ordinary
Shares represented by the ADSs.

                                       8
<PAGE>


Taxation of Dividends

     Dividends  are declared  gross in U.S.  dollars.  Dividends  paid by us are
treated as having  suffered  Jersey income tax at the standard  rate  (currently
20%) on the gross amount thereof.

     Charities,  superannuation  funds and certain  assurance  companies  in the
U.K.,  together  with  individual  investors  who are  Commonwealth  citizens or
citizens of a member state of the European Community,  may be entitled to a full
or partial  repayment of the Jersey income tax credit suffered on distributions,
on submission of a claim to the Jersey  Comptroller of Income Tax.  Shareholders
who are unsure of their tax position should consult their tax advisor.

     Generally,  the  net  dividend  paid to a  holder  or  owner  who is a U.S.
citizen, a U.S. resident, a U.S. domestic corporation or a trust or estate whose
income is subject to U.S. federal income taxation  regardless of source (a "U.S.
holder") will be included in gross income and treated as foreign source dividend
income for U.S. federal income tax purposes to the extent payment is made out of
the Company's  current or accumulated  earnings and profits as determined  under
U.S.  federal  income  tax  principles.  Such  dividends  generally  will not be
eligible for the "dividends  received"  deduction  permitted to be taken by U.S.
corporations.

     However,  special  rules apply for  purposes of  determining  the  dividend
income and potential  foreign tax credits  available to a U.S.  corporation that
controls 10% or more of the Company's voting stock. Any such shareholder  should
consult its tax advisor with respect to the U.S. interest in the Company.

Taxation of Capital Gains

     Currently, there are no Jersey taxes levied on capital gains. A U.S. holder
that sells or exchanges an ADR or Ordinary Share will generally recognize a gain
or loss  for  U.S.  federal  income  tax  purposes,  in an  amount  equal to the
difference  between the amount realized and the holder's tax basis in either the
ADS  represented  by the ADR or the  Ordinary  Share.  Such a gain or loss  will
generally  be a  capital  gain or loss if the ADR or the  Ordinary  Share  was a
capital asset in the hands of the U.S.  holder and will generally be a long-term
capital  gain or loss if the ADR or  Ordinary  Share  was held for more than one
year  (including,  in the case of an ADR,  the period  during which the Ordinary
Shares surrendered in exchange  therefore were held). In general,  the long-term
capital gain of a non-corporate  U.S. holder is subject to a maximum tax rate of
20% if the ADRs or Ordinary  Shares were sold before May 6, 2003.  Under certain
conditions,  an 18%  capital  gains tax rate is  available  if the holder made a
certain  election for shares held on December 31, 2000.  If the ADRs or Ordinary
Shares were sold after May 5, 2003, the maximum tax rate is 15%.

Backup Withholding Tax

     A U.S. holder may be subject to U.S. backup withholding tax (currently at a
rate of 30%) with respect to dividends  received or gross proceeds from the sale
of ADRs or Ordinary Shares unless the holder provides a taxpayer  identification
number and certain  certifications  or otherwise  establishes  an exemption from
backup withholding. Certain classes of persons, such as corporations, are exempt
from backup withholding. Backup withholding is not an additional tax; the amount
withheld may be credited against the holder's U.S. federal income tax liability,
and a refund  of any  excess  may be  obtained  from the U.S.  Internal  Revenue
Service.

Estate and Gift Tax

     No death, estate, gift, inheritance or capital transfer taxes are levied in
Jersey.

Stamp Duty and Stamp Duty Reserve Tax

     No U.K. stamp duty should be payable on any transfer of an Ordinary  Share,
or of an ADS, provided it is executed and retained outside the U.K. Therefore, a
transfer of an ADS in the United States would not ordinarily give rise to a U.K.
stamp duty charge.


                                       9
<PAGE>


     An instrument  transferring Ordinary Shares, or an ADS, could be subject to
U.K.  stamp duty if its execution  relates to anything done or to be done in the
U.K. For example,  a U.K. stamp duty may apply if such instrument is executed in
the U.K. or is brought into the U.K.  after  execution.  If the transfer is on a
sale then the rate of stamp duty will be 0.5% of the  consideration  given. This
charge is rounded up to the nearest  (pound)5.  Gifts and other  transfers which
are neither sales,  nor made in contemplation of a sale, are not subject to this
charge.  Instead,  they will  either be exempt  or  subject  to a fixed  duty of
(pound)5 per transfer.

     A transfer from the Depositary to an ADS holder of the underlying  Ordinary
Shares may be subject to a fixed  stamp duty of (pound)5  if the  instrument  of
transfer relates to anything done or to be done in the U.K. For example, a fixed
stamp duty of (pound)5 may apply if such  transfer is executed in the U.K. or is
to be brought into the U.K. after execution.  A transfer of Ordinary Shares from
the Depositary directly to a purchaser on behalf of an ADS holder may be subject
to a  stamp  duty at a rate of  0.5%  of the  consideration  (rounded  up to the
nearest (pound)5) if execution of the instrument of transfer relates to anything
done or to be done in the U.K.; for example, if such transfer is executed in the
U.K. or is to be brought into the U.K. after execution.

     U.K. stamp duty reserve tax will not be payable on an agreement to transfer
the Ordinary Shares or ADSs.

EQUITY COMPENSATION PLANS

     The  following  table is a summary of selected  information  for our equity
compensation plans as of December 31, 2003.
<TABLE>
<CAPTION>
                                                                                                   Number of Shares
                                            Number of Shares to        Weighted-Average     Remaining Available for
                                        be Issued Upon Exercise       Exercise Price of       Future Issuance Under
                                        of Outstanding Options,    Outstanding Options,         Equity Compensation
                                            Warrants and Rights     Warrants and Rights                       Plans
                                       ------------------------    --------------------     -----------------------

<S>                                                  <C>                        <C>                             <C>
Equity compensation plans
  approved by shareholders..............              8,945,000(1)                $3.10                         (1)

Equity compensation plans not
  approved by shareholders..............                388,100(1)                 3.73                         (1)
                                                ---------------                --------
Total...................................              9,333,100                   $3.13
                                                ---------------                --------
                                                ---------------                --------
<FN>
(1)  Our  equity  compensation  plans do not  contain  a limit on the  number of
     options that may be granted to employees.  However,  the plans do not allow
     for the issuance of previously  authorized and unissued  shares to meet the
     obligations of the plans upon an employee option  exercise.  When an option
     is granted,  the trust that  administers  the plan borrows funds from us or
     one of our  subsidiaries  and uses those  funds to  purchase  the number of
     shares  underlying the option grant.  The maximum loan allowed in any given
     year  is  equal  to 5% of  consolidated  net  assets  as of the  end of the
     previous fiscal year.
</FN>
</TABLE>

     Information  regarding  the  features of the equity  compensation  plan not
approved  by  shareholders  is  incorporated  by  reference  to  Note  17 to the
Consolidated Financial Statements presented in Item 8 of this Form 10-K.

WARRANTS

     On November 11, 2002,  we agreed to grant  1,933,172  warrants to subscribe
for our Ordinary  Shares to Bank of Scotland in connection with the extension of
our credit  facility  (which was fully repaid and terminated in June 2003).  The
warrants  were  granted  on  February  14,  2003 and have an  exercise  price of
(pound)0.1143 (based on the average of the closing prices of the Ordinary Shares
over the trading days from November 1, 2002 through  November 11,  2002),  which
was higher than the market price of  (pound)0.09  on November  11,  2002.  These
warrants are  exercisable at any time prior to February 14, 2010. At the time of
grant, the Company determined the fair value of the warrants to be approximately
$251,000  which was charged to earnings  over the loan period.

                                       10
<PAGE>

Item 6. SELECTED FINANCIAL DATA

     The following is a summary of selected  financial data for the Group.  This
data  should be read in  conjunction  with the  audited  consolidated  financial
statements, and the notes thereto, presented in Item 8 "Financial Statements and
Supplementary Data" of this Form 10-K. ADS amounts have been restated to reflect
the four-for-one  split in March 2000 and the one-for-ten  reverse split in June
2002.
<TABLE>
<CAPTION>
                                                                         Years Ended/As of December 31,
                                                            ----------------------------------------------------------
                                                               2003        2002        2001        2000        1999
                                                            ----------  ----------  ----------  ----------  ----------
                                                                  (In thousands, except per share and ADS data)
<S>                                                         <C>         <C>         <C>         <C>         <C>
Operating Results
Revenues from continuing operations, including net realized
   and change in net unrealized investment gains and losses $    9,198  $  (33,337) $ (194,376) $   87,700  $  194,563
Income (loss) from continuing operations before income
   taxes................................................         1,047     (54,478)   (221,033)     66,784     156,778
Income tax expense (benefit) on continuing operations...           (42)      1,291       2,107       1,156       2,159
Income (loss) from discontinued operations..............         9,965    (154,678)   (180,194)    (51,774)    148,884
Income tax expense (benefit) on discontinued operations.            38      (4,943)    (58,550)    (18,603)     51,627
Net income (loss).......................................        11,016    (205,504)   (344,784)     32,457     251,876
Basic earnings (loss) per share:
   Continuing operations................................          0.02       (1.10)      (4.38)       1.29        3.10
   Discontinued operations..............................          0.20       (2.95)      (2.38)      (0.65)       1.95
                                                            ----------  ----------  ----------  ----------  ----------
Total basic earnings (loss) per share...................          0.22       (4.05)      (6.76)       0.64        5.05
Diluted earnings (loss) per share:
   Continuing operations................................          0.02       (1.10)      (4.38)       1.08        2.79
   Discontinued operations..............................          0.20       (2.95)      (2.38)      (0.55)       1.75
                                                            ----------  ----------  ----------  ----------  ----------
Total diluted earnings (loss) per share.................          0.22       (4.05)      (6.76)       0.53        4.54
Basic earnings (loss) per ADS:
   Continuing operations................................          0.21      (10.99)     (43.77)      12.92       30.99
   Discontinued operations..............................          1.96      (29.50)     (23.85)      (6.53)      19.50
                                                            ----------  ----------  ----------  ----------  ----------
Total basic earnings (loss) per ADS.....................          2.17      (40.49)     (67.62)       6.39       50.49
Diluted earnings (loss) per ADS:
   Continuing operations................................          0.21      (10.99)     (43.77)      10.81       27.89
   Discontinued operations..............................          1.94      (29.50)     (23.85)      (5.46)      17.54
                                                            ----------  ----------  ----------  ----------  ----------
Total diluted earnings (loss) per ADS...................          2.15      (40.49)     (67.62)       5.35       45.43

Financial Position
Cash and total investments (continuing operations)......        61,944      69,378     262,058     455,721     355,941
Total assets............................................        63,513      80,217   2,539,126   2,562,988   2,195,266
Bank debt...............................................             -       9,314      36,874      35,556           -
Guarantees under bank facility..........................             -      10,590           -           -           -
Shareholders' equity....................................        34,897      21,486     221,653     567,742     552,475
Book value per share (1)................................          0.69        0.42        4.37       11.00       11.25
Book value per ADS (1)..................................          6.88        4.23       43.68      109.98      112.52

Ordinary Share and ADS Data
Ordinary Shares outstanding as of December 31...........        64,439      64,439      64,439      64,433      64,433
Weighted-average shares used in:
   Basic earnings per share calculation.................        50,754      50,753      50,984      50,795      49,892
   Diluted earnings per share calculation...............        51,188      50,753      50,984      60,728      55,445
Total dividends per share relating to the year (gross)..    $        -  $        -  $     0.16  $     0.29  $     0.29
Total dividends per ADS relating to the year............    $        -  $        -  $     1.28  $     2.32  $     2.32
Market price per share on December 31...................  (pound) 0.14(pound)0.055 (pound)2.60 (pound)5.53 (pound)5.59
Market price per ADS on December 31.....................    $     2.51  $     0.50  $    39.60  $    75.60  $    90.00
Market capitalization as of December 31.................    $   16,148  $    5,706  $  244,611  $  530,431  $  583,495

<FN>
(1) Based on the net asset value of the Group after deducting the cost of the shares held by the employee  benefit  trusts,
    and on the number of shares outstanding excluding the shares held by the employee benefit trusts.
</FN>
</TABLE>

                                       11
<PAGE>


Item 7. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

     This  Management's  Discussion  and  Analysis of  Financial  Condition  and
Results  of  Operations   should  be  read  in  conjunction   with  the  audited
consolidated  financial statements,  and the notes thereto,  presented in Item 8
"Financial   Statements  and   Supplementary   Data"  of  this  Form  10-K.  The
consolidated  financial  statements are prepared in accordance  with  accounting
principles  generally  accepted in the United  States.  This item should also be
read in conjunction  with the  "Forward-Looking  Statements and Factors That May
Affect Future  Results" which are set forth below and our other filings with the
SEC.

Forward-Looking Statements and Factors That May Affect Future Results

     This  Management's  Discussion  and  Analysis of  Financial  Condition  and
Results  of   Operations   and  other   sections  of  this  Form  10-K   contain
forward-looking  statements  within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended.  Such forward-looking  statements are based on
current expectations,  estimates, forecasts and projections about the industries
in which we  operate,  management's  current  beliefs  and  assumptions  made by
management.   Words  such  as  "expects,"   "anticipates,"  "intends,"  "plans,"
"believes," "seeks,"  "estimates," "goals," variations of such words and similar
expressions  are intended to identify  such  forward-looking  statements.  These
statements are not guarantees of future  performance  and involve certain risks,
uncertainties and assumptions that are difficult to predict. Future outcomes and
results may differ  materially  from what is  expressed  or  forecasted  in such
forward-looking   statements.   We  undertake  no   obligation   to  update  any
forward-looking  statements,  whether  as a result  of new  information,  future
developments or otherwise.

     Factors   that  could  cause  or   contribute   to   deviations   from  the
forward-looking statements include those discussed in this section, elsewhere in
this Form 10-K and in our other filings with the SEC. The factors  include,  but
are not  limited  to,  (i) the  risks  described  in Item 7A  "Quantitative  and
Qualitative  Disclosures  About Market Risk," (ii)  variations in demand for our
products and services,  (iii) the success of our new products and services, (iv)
significant  changes  in  net  cash  flows  in or out  of  our  businesses,  (v)
fluctuations in the performance of debt and equity markets  worldwide,  (vi) the
enactment  of  adverse  state,  federal  or  foreign  regulation  or  changes in
government policy or regulation  (including  accounting standards) affecting our
operations,  (vii) the effect of economic  conditions  and interest rates in the
U.S., the U.K. or  internationally,  (viii) the ability of our  subsidiaries  to
compete in their respective  businesses,  (ix) our ability to attract and retain
key personnel,  and (x) actions by  governmental  authorities  that regulate our
businesses, including insurance commissions.

                                       12
<PAGE>


Results of Operations by Business Segment

     Income before income taxes for our reportable operating segments,  based on
management's internal reporting structure, is as follows:
<TABLE>
<CAPTION>

                                                                             Years Ended December 31,
                                                                        ----------------------------------
                                                                           2003        2002        2001
                                                                        ----------  ----------  ----------
                                                                                    (In thousands)
Income (loss) from continuing operations before income taxes
  by operating segment:
<S>                                                                     <C>         <C>         <C>
Life insurance and annuities (1) ....................................   $    1,577  $  (19,637) $ (163,873)
Venture capital and consulting (2) ..................................        3,571     (28,149)    (51,262)
                                                                        ----------  ----------  ----------
                                                                             5,148     (47,786)   (215,135)
Reconciliation of segment amounts to consolidated amounts:
Interest income .....................................................           53         531       1,967
Corporate expenses ..................................................       (3,478)     (5,869)     (5,635)
Goodwill amortization and write-offs.................................            -        (389)        (48)
Interest expense  ...................................................         (676)       (965)     (2,182)
                                                                        ----------  ----------  ----------
Consolidated income (loss) from continuing operations before
  income taxes ......................................................   $    1,047  $  (54,478) $ (221,033)
                                                                        ----------  ----------  ----------
                                                                        ----------  ----------  ----------
<FN>
(1) Netted  against the revenues  (investment  income) of the life  insurance and  annuities  segment are
    management  fees paid to BCM (discontinued operations) of $5,000, $39,000 and $47,000 in 2003, 2002
    and 2001, respectively.

(2) Included in the revenues of the venture capital and consulting segment are management fees from LPLA
    (discontinued  operations) of $0, $2,908,000 and $9,924,000 in 2003, 2002 and 2001, respectively.
</FN>

</TABLE>

     Business  segment data contained in Note 21 to the  Consolidated  Financial
Statements in Item 8 of this Form 10-K should be read in  conjunction  with this
discussion.  A detailed  discussion of the results for each  reportable  segment
follows.

                                       13
<PAGE>




Life Insurance and Annuities

     Certain  information  regarding our life insurance and annuities  segment's
results of operations (continuing operations only) is as follows:
<TABLE>
<CAPTION>

                                                                             Years Ended December 31,
                                                                        ----------------------------------
                                                                           2003        2002        2001
                                                                        ----------  ----------  ----------
                                                                                  (In thousands)
Revenues:
<S>                                                                     <C>         <C>         <C>
Investment income....................................................   $    1,834  $    6,059  $    6,214
Insurance policy charges ............................................            6       1,155          (7)
Net realized investment gains (losses) ..............................      (38,329)   (114,325)     12,900
Change in net unrealized investment gains and losses on
  trading securities.................................................       40,947      97,762    (174,780)
                                                                        ----------  ----------  ----------
Total revenues and net investment gains (losses) ....................        4,458      (9,349)   (155,673)

Expenses:
Amounts credited on insurance policyholder accounts .................        1,922       6,031       6,314
Amortization of deferred policy acquisition costs ...................            -       2,952         932
General and administrative expenses .................................          959       1,305         954
                                                                        ----------  ----------  ----------
Total expenses related to operations ................................        2,881      10,288       8,200
                                                                        ----------  ----------  ----------
Income (loss) from continuing operations before income taxes ........   $    1,577  $  (19,637) $ (163,873)
                                                                        ----------  ----------  ----------
                                                                        ----------  ----------  ----------
</TABLE>

     As  previously  disclosed  in our 2002 Annual  Report on Form 10-K,  during
2002, our primary insurance  company,  LPLA, was placed under regulatory control
and rehabilitation  based on LPLA's statutory capital and surplus as of June 30,
2002.  On August 6, 2002,  on petition of the  Commissioner  with the consent of
LPLA and  unanimous  approval of its board of directors,  the Superior  Court of
Wake  County in the State of North  Carolina  ordered the  Commissioner  to take
possession and control of all of the property, books and accounts, documents and
other records of LPLA.  As a result of this event,  we  deconsolidated  LPLA and
recorded a charge to earnings in 2002 of $38.5 million for losses resulting from
this disposition.

     For further  discussion,  see the "Liquidity and Capital Resources" section
below and Note 3 to the Consolidated Financial Statements in Item 8 of this Form
10-K.

     On July 2, 2002, we announced that further  declines in the value of LPLA's
investment  portfolio,  due to persistent negative events in the equity and bond
markets, continued to erode significantly the statutory capital of LPLA and that
we were unsuccessful in concluding a transaction to enhance the capital of LPLA.
As a consequence,  LPLA  discontinued the issuance of new policies as of July 2,
2002. Although the statutory capital of our Jersey insurance  subsidiary,  LPAL,
was not  affected by the adverse  equity and bond  markets to the same extent as
the statutory capital of LPLA, we also announced on July 2, 2002 that LPAL would
discontinue  writing  new  policies  effective  immediately.   The  decision  to
discontinue  the  issuance of new  policies  through  LPAL was made to avoid the
increased capital requirements created by additional  policyholder  liabilities.
Subsequent to this announcement and other announcements  relating to the Company
and LPLA, LPAL policy surrenders increased  substantially.  Approximately 80% of
LPAL's $140.2 million in  policyholder  liabilities as of June 30, 2002 had been
surrendered  or had matured as of December  31, 2003.  During  2003,  there were
$10.4  million  in policy  maturities  and $1.1  million  in policy  surrenders.
Policyholder liabilities as of December 31, 2003 were $28.1 million.

     Due to the events referred to above, LPAL focuses on managing the remaining
block of  policyholder  liabilities.  There are no plans  currently to write new
policies.

                                       14
<PAGE>



2003 compared to 2002

     In 2003, LPAL contributed income before income taxes of $1.6 million to our
overall income from  continuing  operations  before income taxes,  compared to a
loss before taxes of $19.6 million in 2002.  Net realized  investment  losses in
2003 were $38.3  million  compared to net realized  investment  losses of $114.3
million in 2002. The gain from the change in net unrealized investment gains and
losses was $40.9  million in 2003,  compared to $97.8  million in 2002. In 2003,
the spread  between  investment  income and amounts  credited  to  policyholders
decreased by $0.1 million;  amortization  of deferred policy  acquisition  costs
("DPAC") decreased by $3.0 million with the write-off of the DPAC asset in 2002;
and general and  administration  expenses  decreased  by $0.3  million,  each as
compared to 2002.  Policy  surrender  charge  income in 2003  decreased  by $1.1
million compared to 2002.

     LPAL did not generate any premiums during 2003, compared to $6.5 million of
premiums during 2002. LPAL discontinued  selling new policies on July 2, 2002 as
a result of the events described above.

     Interest  and  dividend  income on  investments  was $1.8  million in 2003,
compared with $6.1 million in 2002. This $4.3 million decrease was primarily due
to a decline in the level of invested bonds.

     During 2003,  LPAL used $12.5 million of bond proceeds and cash to meet its
policy  maturities  and  redemptions.  Following  this  reduction,  and  further
expected  bond  realizations  and  maturities   required  to  meet  2004  policy
maturities, interest income is expected to decline to approximately $1.2 million
for 2004.

     Policyholder  liabilities  as of December  31,  2003 were $28.1  million of
which $8.9  million is scheduled  to mature  during  2004.  LPAL expects to meet
these maturities by a combination of cash of approximately  $3.8 million held at
the  beginning of January  2004,  the  proceeds  from  maturing  bonds which are
estimated to be $4.8 million  during 2004,  and  estimated  bond  interest to be
received during 2004 of $1.9 million. In the absence of significant redemptions,
policyholder  liabilities are projected to be approximately $20.3 million at the
end of 2004.  Investment income should equal  approximately 89% of the projected
$1.4 million to be credited to policies,  and operating expenses are expected to
be  approximately  $1.1 million during 2004. Net unrealized  investment gains on
LPAL's listed equity securities  decreased by $1.8 million during the two months
ended February 29, 2004.

     Net  investment  gains  totaled  $2.6  million  in  2003,  compared  to net
investment  losses of $16.6 million in 2002. Net  investment  gains in 2003 were
comprised of net realized  investment  losses of $38.3 million and $40.9 million
in gains from the change in net realized  gains and losses on the listed  equity
securities held in the trading portfolio.  The trading portfolio  increased from
$8.9 million as of December  31, 2002 to $13.5  million as of December 31, 2003.
LPAL sold certain trading  positions during 2003, which resulted in net realized
losses of $20.8 million based on an aggregate original cost of $23.7 million and
one of LPAL's  trading  positions  was acquired by a larger listed  company,  in
exchange for $0.6 million of stock in the acquiring company, which resulted in a
realized loss of $12.8 million based on an original cost of $13.4 million. These
disposals represented shares held in companies that had completed initial public
offerings  of  their  securities.   These  realized  losses  were  increased  by
other-than-temporary  impairment  charges  totaling  $4.7 million on two private
equity security holdings in our available-for-sale investment portfolio.

     Total  invested  assets  (defined as total assets  excluding DPAC and other
assets)  decreased to $47.9  million as of December 31, 2003,  compared to $51.6
million as of December 31, 2002,  primarily  due to the decrease in  investments
used to pay out maturing policies and the $4.7 million reduction in the value of
two private  equity  investments  that became  other-than-temporarily  impaired,
partially  offset by increases in the value of the trading  portfolio.  On total
average  invested assets in 2003, the average  annualized net return,  including
both realized and unrealized  investment  gains and losses,  was 8.9%,  compared
with -9.1% in 2002.

     Policy  surrender  charge  income  decreased  to $6,000 in 2003,  from $1.2
million in 2002. Policy surrenders  decreased  significantly  during 2003 due to
the high volume of surrenders during the second half of 2002.

                                       15
<PAGE>

     Amounts credited on policyholder accounts decreased by $4.1 million in 2003
to $1.9  million,  compared to $6.0 million in 2002.  The decrease was primarily
due to substantial  increases in  policyholder  surrenders in the second half of
2002  together  with  policy  maturities  in the last nine  months of 2003.  The
average rate credited to policyholders  was 5.9% in 2003,  compared with 6.1% in
2002.

     There  was no DPAC  amortization  in 2003 due to the  acceleration  of DPAC
amortization  to fully  write-off DPAC as of September 30, 2002. The reasons for
the write-off in 2002 were the  discontinuance  of new business at the beginning
of the third  quarter of 2002 and the lack of interest  spread on the  remaining
block of business.

     General  and  administrative  expenses  decreased  by $0.3  million to $1.0
million in 2003 due to decreases in staff compensation and back office expenses.

2002 compared to 2001

     In 2002,  LPAL  contributed  a loss before income taxes of $19.6 million to
our overall loss from continuing  operations before income taxes,  compared to a
loss before taxes of $163.9 million in 2001. Net realized  investment  losses in
2002 were $114.3  million  compared to net  realized  investment  gains of $12.9
million in 2001. The gain from the change in net unrealized investment gains and
losses was $97.8 million in 2002,  compared to a loss of $174.8 million in 2001.
In  2002,  the  spread  between   investment  income  and  amounts  credited  to
policyholders increased by $0.1 million;  amortization of DPAC increased by $2.0
million  with  the  write-off  of the  DPAC  asset  in  2002;  and  general  and
administration  expenses  increased by $0.4  million,  each as compared to 2001.
Policy charges in 2002 increased by $1.2 million compared to 2001.

     LPAL  generated  $6.5 million of premiums  during 2002, a decrease of $69.2
million  from the  premiums  received  by LPAL in 2001.  LPAL's  premium  volume
continued to decline as a result of lowering interest crediting rates during the
last quarter of 2001 and the events as described above.

     Interest  and  dividend  income on  investments  was $6.1  million in 2002,
compared with $6.2 million in 2001. This $0.1 million decrease was primarily due
to  a  decline  in  the  level  of  invested  bonds  and  cash,  offset  by  the
strengthening of sterling on the level of U.S. dollar income.

     Net  investment  losses  were  $16.5  million  in  2002,  compared  to  net
investment  losses of $161.9 million in 2001. Net investment losses in 2002 were
comprised of net realized  investment losses of $114.3 million and $97.8 million
in gains from the change in net realized  gains and losses on the listed  equity
securities held in the trading portfolio.  The trading portfolio  decreased from
$22.3  million as of December  31, 2001 to $8.9 million as of December 31, 2002.
Additions to the trading portfolio during 2002 of $5.0 million resulted from the
transfer of certain listed equity  securities from the venture capital  segment.
LPAL sold certain trading  positions during 2002, which resulted in net realized
losses of $102.9 million based on an aggregate  original cost of $116.2 million.
These disposals  represented shares held in companies that had completed initial
public  offerings of their  securities.  These realized losses were increased by
net realized losses of $2.9 million on sales of $96.9 million of publicly traded
corporate debt securities and by other-than-temporary  impairment charges on two
private equity securities totaling $8.2 million and on one public corporate bond
of $0.3 million.

     Total  invested  assets  (defined as total assets  excluding DPAC and other
assets)  decreased to $51.6 million as of December 31, 2002,  compared to $161.5
million as of December 31, 2001. On total average  invested  assets in 2002, the
average annualized net return, including both realized and unrealized investment
gains and losses, was -9.1%, compared with -78.8% in 2001.

     Policy  surrender  charge income  increased by $1.2 million in 2002 to $1.2
million,  compared with a net expense of $7,000 in 2001.  The increase in policy
surrenders followed the events as described above.

     Amounts credited on policyholder accounts decreased by $0.3 million in 2002
to $6.0 million,  compared with $6.3 million in 2001. The decrease was primarily
due to the substantial  increases in policyholder  surrenders in the second half
of 2002. The average rate credited to policyholders  was 6.1% in 2002,  compared
with 6.6% in 2001.

                                       16
<PAGE>

     Amortization  of DPAC was $3.0 million in 2002, an increase of $2.0 million
over 2001.  This increase was due to the  acceleration  of DPAC  amortization to
fully write-off DPAC as of September 30, 2002, as explained above.

     General and  administrative  expenses  were $1.3 million in 2002,  compared
with $1.0 million in 2001.  This $0.3 million  increase was primarily due to the
reduction  in  expenses  deferred  as  policy  acquisition  costs  and  employee
severance costs.

Venture Capital and Consulting

     Certain information  regarding our venture capital and consulting segment's
results of operations is as follows:
<TABLE>
<CAPTION>

                                                                             Years Ended December 31,
                                                                        ----------------------------------
                                                                           2003        2002        2001
                                                                        ----------  ----------  ----------
                                                                                   (In thousands)
Revenues:
<S>                                                                     <C>         <C>         <C>
Management fees......................................................   $        -  $    2,908  $    9,924
Net realized investment gains (losses) (1) ..........................       (2,107)    (44,130)     42,876
Change in net unrealized investment gains and losses on
  trading securities (1).............................................        6,794      16,703     (93,470)
                                                                        ----------  ----------  ----------
Total revenues and net investment gains (losses).....................        4,687     (24,519)    (40,670)
Operating expenses...................................................        1,116       3,630      10,592
                                                                        ----------  ----------  ----------
Income (loss) before income taxes....................................   $    3,571  $  (28,149) $  (51,262)
                                                                        ----------  ----------  ----------
                                                                        ----------  ----------  ----------
<FN>
(1)  Net realized  investment  losses in the amounts of $0 and  $1,603,000  were recorded  during 2003 and 2002,
     respectively,  by the venture  capital and consulting segment, related to intersegmental  investment sales
     to the life insurance and annuities segment.  These net realized investment losses were offset  by
     corresponding   reclassification   adjustments  in  unrealized investment  gains and losses on trading
     securities  for the same  amounts. These gains and losses have been eliminated in our  consolidated  financial
     statements.
</FN>
</TABLE>

2003 compared to 2002

     In 2003, the venture  capital and  consulting  segment  contributed  income
before  income  taxes of $3.6  million to our  overall  income  from  continuing
operations before income taxes, compared to a loss before taxes of $28.1 million
in 2002.  The income and loss in those  years,  respectively,  was  attributable
primarily to net realized and unrealized  investment  gains and losses on listed
equity  securities.  These positions in listed equity  securities  resulted from
privately held technology companies, in which the venture capital and consulting
segment had an equity  interest,  completing  initial public  offerings or being
acquired by publicly traded companies in stock-for-stock acquisitions.

     The change in net unrealized  gains and losses in the listed equity trading
portfolio during 2003 was a gain of $6.8 million,  which was partially offset by
net realized losses of $2.1 million.  The trading portfolio  decreased from $7.6
million as of December 31, 2002 to $3.4 million as of December 31, 2003. We sold
certain trading  positions  during 2003 which resulted in net realized losses of
$1.9  million  based  on an  aggregate  original  cost of $11.0  million.  These
realized losses were increased by other-than-temporary impairment write-downs of
$0.2 million on two private investments  relating to the guarantees as discussed
in Note 12 to the Consolidated Financial Statements in Item 8 of this Form 10-K.
All  intersegmental  investment gains and losses,  other than those arising from
sales  to  LPLA   (discontinued   operations),   have  been  eliminated  in  our
consolidated statements of income.

     We expect  significant  fluctuations in net unrealized  gains and losses in
the listed equity  trading  portfolio in future  periods,  reflecting  continued
equity market volatility, especially in the technology sector.

                                       17
<PAGE>

     The venture capital and consulting segment earned portfolio management fees
from LPLA of $2.9  million  in 2002.  Due to the events  described  above in the
section entitled "Life Insurance and Annuities," BICC has not received fees from
the management of LPLA's investment portfolio since early 2002.

     Operating  expenses in 2003 were $1.1 million,  compared to $3.6 million in
2002. The $2.5 million decrease was attributable primarily to lower staff costs,
reflecting  the  reduction in business  and  staffing  during the second half of
2002.

     BICC is  redeveloping  its venture  capital  business.  BICC has  extensive
business  relationships  among  Silicon  Valley  companies  seeking  later stage
capital and in the investor  community  globally.  The venture capital  industry
continues to face a difficult  environment in early 2004. The operating  results
for this  business  segment,  and for the  Group as a  whole,  for 2004  will be
largely driven by portfolio performance in uncertain market conditions.

2002 compared to 2001

     The pre-tax loss from the venture capital and consulting  segment decreased
from  $51.3  million in 2001 to $28.1  million  in 2002.  The loss in both years
primarily was attributable to net realized and unrealized  investment  losses on
listed equity securities.  These positions in listed equity securities  resulted
from  privately  held  technology  companies,  in which the venture  capital and
consulting  segment had an equity interest,  completing initial public offerings
or being acquired by publicly traded companies in stock-for-stock acquisitions.

     The change in net unrealized  gains and losses in the listed equity trading
portfolio during 2002 was a gain of $16.7 million, which was more than offset by
net realized  losses of $44.1  million,  of which $33.0  million  resulted  from
disposals of certain listed equity securities to LPLA (discontinued operations),
based on their  aggregate cost of $50.0  million.  We also took $14.0 million in
other-than-temporary   impairment   write-downs  on  four  private  investments,
including  $10.8  million  relating to guarantees as discussed in Note 12 to the
Consolidated  Financial  Statements  in Item 8 of this Form  10-K.  The  trading
portfolio  decreased  from $45.3 million as of December 31, 2001 to $7.7 million
as of December 31, 2002.  Additions to the trading  portfolio of $1.3 million in
2002 resulted from the purchase of listed equity securities. The realized losses
were  partially  offset by net  realized  gains of $1.3 million on sales of $2.3
million  of  listed  equity  securities  and a  realized  gain of  $1.6  million
resulting  from the disposal of certain  listed  equity  securities  to the life
insurance and annuities  segment  (LPAL),  based on their aggregate cost of $3.4
million.  All  intersegmental  investment  gains and  losses,  other  than those
arising from sales to LPLA  (discontinued  operations),  have been eliminated in
our consolidated statements of income.

     The venture capital and consulting segment earned portfolio management fees
from LPLA of $2.9 million in 2002,  compared to $9.9  million in 2001.  The $7.0
million  decrease in fees resulted  from the lower value of the assets  managed,
the lower  percentage  fees  recorded  for the second  quarter of 2002,  and the
discontinuation  of fees from LPLA for the third and fourth  quarter of 2002. As
explained above, BICC no longer manages LPLA's investment portfolio.

     BICC completed total  financings of $27.2 million during 2002,  compared to
$67.0  million in 2001. No  financings  were made in new companies in 2002,  but
follow-on  investments were completed in selected portfolio companies,  where in
some cases,  larger  ownership  stakes could be taken in promising  companies at
attractive  prices.   This  decreased  level  of  activity  in  venture  capital
placements  reflected a general trend in the industry as a whole during 2002, as
many venture capitalists curtailed their investments in view of the difficulties
experienced by the overall market and the technology sector in particular.

     Operating expenses in 2002 were $3.6 million,  compared to $10.6 million in
2001. The $7.0 million decrease was attributable primarily to lower staff costs,
reflecting the reduction in business and staffing during the year.

                                       18
<PAGE>



Corporate and Other

2003 compared to 2002

     Corporate  expenses  decreased by $2.4 million to $3.5 million in 2003,  as
compared to $5.9 million for 2002. This decrease  primarily was due to decreases
in staff compensation and bank facility costs.

     The amount of interest  income we earned  (excluding the life insurance and
annuities segment) decreased by $0.5 million to $53,000 in 2003 as compared with
2002,  primarily  due  to  the  decrease  in  our  holdings  of  cash  and  cash
equivalents,  as well as lower interest rates. The amount of interest expense we
incurred  (excluding the life insurance and annuities segment) decreased by $0.3
million to $0.7  million  in 2003 as  compared  with 2002,  due to the impact of
lower bank borrowings  which was largely offset by the accelerated  amortization
of bank facility costs  (restructuring  fees and the value of warrants issued to
the Bank of Scotland) in the second  quarter of 2003,  resulting  from the early
repayment of the bank facility.  A discussion of our sources and uses of cash is
discussed in "Liquidity and Capital Resources" below.

2002 compared to 2001

     Corporate  expenses  increased by $0.3 million to $5.9 million in 2002,  as
compared to $5.6 million for 2001.  This  increase was  primarily  due to higher
bank facility costs,  corporate  insurance  premiums,  pension costs,  legal and
professional  services  fees and audit fees,  partially  offset by  decreases in
staff compensation, directors fees, stock exchange fees and registrar fees.

     The amount of interest  income we earned  (excluding the life insurance and
annuities segment) decreased by $1.5 million to $0.5 million in 2002 as compared
with 2001,  primarily due to the decrease in cash and cash  equivalents  held by
us. The amount of interest expense we incurred (excluding the life insurance and
annuities segment) decreased by $1.2 million to $1.0 million in 2002 as compared
with 2001,  primarily due to the partial  repayment of bank  borrowings  and the
lower interest rate environment.

Consolidated Income (Loss) from Continuing Operations Before Income Taxes

2003 compared to 2002

     Consolidated income from continuing operations before income taxes was $1.0
million in 2003,  compared to a loss of $54.5 million in 2002. This  substantial
improvement primarily was due to net realized and unrealized investment gains of
$7.3 million in 2003, compared to net realized and unrealized  investment losses
of $44.0 million in 2002.

     Consolidated  income  before  income taxes for future years may be volatile
due to our holdings of listed  equity  securities  primarily  in the  technology
sector, which are marked to market with changes in their market value recognized
in the income statement for each period. Other-than-temporary impairments of our
private equity  securities  primarily in the technology sector could also affect
our  consolidated  income  before  income  taxes  in  future  periods.  For more
information  on the  possible  effects  of  volatility  in the  prices of equity
securities,  see Item 7A "Quantitative and Qualitative  Disclosures About Market
Risk" below.

     See the  discussion of events  relating to LPLA,  LPAL,  BCM and LPA in the
"Liquidity and Capital Resources" section below.

     Subsequent to the  completion of the sales of BCM and LPA, our focus is now
on our technology  venture capital business.  The market environment for venture
capital  continues to be very weak.  We are pursuing  opportunities  to grow the
business  in the  future.  However,  there  is no  guarantee  that  we  will  be
successful in redeveloping our venture capital operations.

                                       19
<PAGE>




2002 compared to 2001

     Our  consolidated  loss from  continuing  operations  before  income  taxes
decreased  from $221.0  million in 2001 to $54.5 million in 2002.  This loss was
attributable  primarily  to the change in net  unrealized  investment  gains and
losses on the listed equity securities held in the trading portfolio, as well as
net realized investment losses.

Income Taxes

     We are  subject  to  taxation  on our income in all  countries  in which we
operate based upon the taxable income arising in each country. However, realized
gains on certain  investments are exempt from Jersey and Guernsey  taxation.  We
are subject to income tax in Jersey at a rate of 20%. In the United  States,  we
are subject to both federal and California taxes at 34% and 8.84%, respectively.

2003 compared to 2002 (continuing operations)

     On income from  continuing  operations  before income taxes of $1.0 million
for 2003, we had an income tax benefit of $42,000. This was largely attributable
to income of $2.6  million  contributed  by the Jersey and  Guernsey  operations
during the year,  which  primarily  consisted of realized  losses and unrealized
investment gains for which no tax benefits or expense will be realized. Although
$1.5 million of losses were  contributed by our U.S.  subsidiaries  for 2003, we
did not recognize any U.S. tax benefits,  due to the 100%  valuation  allowances
that we have provided for all deferred tax assets.

2002 compared to 2001 (continuing operations)

     Although the loss from continuing  operations before income taxes was $54.5
million for 2002,  an income tax expense of $1.3 million  resulted for the year.
This was largely  attributable  to losses of $52.8  million  contributed  by the
Jersey and Guernsey  operations  during the year,  which primarily  consisted of
realized and  unrealized  investment  losses for which no tax  benefits  will be
realized.  In addition,  deferred  tax asset  valuation  allowances  in the U.S.
subsidiaries of continuing  operations were increased by $3.2 million during the
year.  These  allowances  were  considered  necessary  due to the high  level of
operating loss carryovers in the two U.S. tax groups,  raising doubt about their
ability to utilize these carryovers.

2003 (disposal of discontinued operations)

     We  recorded  $36,000 of income tax  expense on book gains  totaling  $11.7
million from the sales of BCM and LPA. Income taxes based on statutory tax rates
applied to the taxable  gains on these sales were  approximately  $4.9  million.
However,  due to net operating  losses in the U.S. tax groups in the current and
prior years,  and capital loss  carryovers from prior years, we expect to offset
all of the taxes  related to the gains on the sale of BCM and LPA,  except for a
small amount of federal  alternative  minimum tax. A portion of the capital loss
carryovers  from prior  years  which we expect to utilize to offset the  current
year taxable gains resulted from the loss of control of LPLA in 2002.

Discontinued Operations

     In the first six months of 2002,  prior to the loss of  management  control
over LPLA,  we  recorded an  after-tax  loss from  operations  of LPLA of $104.8
million, compared to an after-tax loss from operations of LPLA of $120.7 million
for all of 2001.  The loss in the first  half of 2002  primarily  was due to net
realized investment losses and the change in net unrealized investment gains and
losses totaling $97.6 million. As discussed above, we recorded impairment losses
totaling  $27.9  million  related  to LPLA in the  third  quarter  of 2002,  and
recognized  $10.6  million in our  income  statement  for LPLA's net  unrealized
losses on available-for-sale securities, net of deferred policy acquisition cost
amortization  adjustments and deferred income taxes. For further information see
Note 3 to the Consolidated Financial Statements in Item 8 of this Form 10-K.

                                       20
<PAGE>

CRITICAL ACCOUNTING POLICIES

     Management has identified those accounting policies that are most important
to the accurate  portrayal of our financial  condition and results of operations
and that require management's most complex or subjective  judgments,  often as a
result of the need to make  estimates  about  the  effect  of  matters  that are
inherently  uncertain.  These most critical  accounting  policies pertain to our
investments  and to the  accounting for life insurance  policy  liabilities.  In
addition,  for 2002 and 2003, our accounting policies relating to consolidation,
deconsolidation  and  the  reporting  of  discontinued  operations  became  very
important to the portrayal of our financial condition and results of operations.
These critical accounting policies are described below.

Determination of Fair Values of Investments

     When a quoted market price is available  for a security,  we use this price
in the  determination  of fair value.  If a quoted market price is not available
for a  security,  management  estimates  the  security's  fair  value  based  on
valuation methodologies as described below.

     We  hold  investments  in  privately  held  equity  securities,   primarily
convertible  preferred  stock in venture  capital  companies  doing  business in
various segments of technology  industries.  Venture capital  investing  entails
making  investments in companies  that are  developing  products or services for
large  emerging  markets  with the  belief  that  these  investments  will yield
superior  returns if these  companies  are  successful.  These  investments  are
normally held for a number of years. When we make these investments, most of the
companies  are still  developing  the products they intend to bring to market or
are in the early stages of product  sales.  Venture  capital  companies  are net
consumers of cash and often dependent upon additional financing to execute their
business plans.  These  investments  involve  substantial risk and the companies
generally  lack  meaningful  historical  financial  results used in  traditional
valuation  models.  The process of pricing  these  securities  range from fierce
competitive  bidding  between  financial   institutions  to  existing  investors
negotiating  prices  with  the  company  without  outside  investor  validation.
Investments  in  convertible   preferred   stock  come  with  rights  that  vary
dramatically both from company to company and between rounds of financing within
the same company. These rights, such as anti-dilution,  redemption,  liquidation
preferences and participation, bear directly on the price an investor is willing
to pay for a security.  The returns on these investments are generally  realized
through an initial  public  offering of the company's  shares or, more commonly,
through the company's acquisition by a public company.

     One of the  factors  affecting  fair value is the  amount of time  before a
company  requires  additional  financing to support its  operations.  Management
believes that companies that are financed to the estimated  point of operational
profitability  or for a period  greater  than one year will most  likely  return
value to the investor through an acquisition between a willing buyer and seller,
as the company does not need to seek financing from an opportunistic investor or
insider in an adverse  investment  environment.  If a particular  company  needs
capital in the near term,  management  considers  a range of factors in its fair
value  analysis,  including  our  ability  to  recover  our  investment  through
surviving liquidation  preferences.  Management's  valuation  methodologies also
include  fundamental  analysis that evaluates the investee company's progress in
developing  products,  building  intellectual  property  portfolios and securing
customer  relationships,  as well as overall industry conditions,  conditions in
and prospects for the investee's  geographic  region,  and overall equity market
conditions.   This  is  combined  with   analysis  of   comparable   acquisition
transactions and values to determine if the security's  liquidation  preferences
will ensure full recovery of our investment in a likely acquisition  outcome. In
its valuation analysis, management also considers the most recent transaction in
a company's shares.

     The determination of fair values of investments requires the application of
significant  judgment.  It is possible that the factors  evaluated by management
and fair values will change in subsequent  periods,  especially  with respect to
our  privately  held equity  securities in  technology  companies,  resulting in
material impairment charges in future periods.

                                       21
<PAGE>


Other-than-temporary Impairments

     Management  performs an ongoing review of all  investments in the portfolio
to   determine   if   there   are  any   declines   in  fair   value   that  are
other-than-temporary.

     Since our listed equity  securities are  classified as trading  securities,
impairment  adjustments  are not  required as any change in the market  value of
these securities between reporting periods is included in earnings.

     In  relation  to  our  equity   securities  that  do  not  have  a  readily
determinable  fair  value  and are  classified  as  available-for-sale,  factors
considered in impairment  reviews include:  (i) the length of time and extent to
which  estimated  fair  values  have been  below  cost and the  reasons  for the
decline,  (ii)  the  investee's  recent  financial  performance  and  condition,
earnings trends and future  prospects,  (iii) the market condition of either the
investee's  geographic area or industry as a whole, and (iv) concerns  regarding
the investee's  ability to continue as a going concern (such as the inability to
obtain  additional  financing).  If the evidence supports that a decline in fair
value is  other-than-temporary,  then the investment is reduced to its estimated
fair value,  which becomes its new cost basis,  and a realized loss is reflected
in earnings.

     We determine that a fixed maturity security is impaired when it is probable
that we will  not be  able to  collect  amounts  due  (principal  and  interest)
according to the security's  contractual  terms. We make this  determination  by
considering  all  available  facts and  circumstances,  including our intent and
ability to continue to hold the investment to maturity.  The factors we consider
include:  (i) the length of time and extent to which the market values have been
below  amortized cost and the reasons for the decline,  (ii) the issuer's recent
financial performance and condition, earnings trends and future prospects in the
near to mid-term,  (iii) changes in the issuer's  debt rating and/or  regulatory
actions or other events that may effect the issuer's operations, (iv) the market
condition of either the issuer's geographic area or industry as a whole, and (v)
factors  that raise  doubt  about the  issuer's  ability to  continue as a going
concern.   If  the   evidence   supports   that  a  decline  in  fair  value  is
other-than-temporary,  then the fixed  maturity  security is written down to its
quoted market value,  if such a value is  available.  If a readily  determinable
fair value does not exist,  then the fixed maturity  security is written down to
management's  estimate  of its fair  value,  which  is  based  on the  valuation
methodologies  described above.  Write-downs are recorded as realized losses and
included in earnings.

     The   evaluations   for   other-than-temporary   impairments   require  the
application of significant  judgment. It is possible that the impairment factors
evaluated  by  management  and fair values will  change in  subsequent  periods,
especially  with  respect to  privately  held equity  securities  in  technology
companies, resulting in material impairment charges in future periods.

Life Insurance Policy Liabilities

     We  account  for life  insurance  policy  liabilities  in  accordance  with
Statement of Financial Accounting Standards No. 97, "Accounting and Reporting by
Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains
and Losses from the Sale of  Investments."  We account for life insurance policy
liabilities for deferred annuities as investment-type  insurance products and we
record these liabilities at accumulated value (premiums  received,  plus accrued
interest to the balance sheet date, less withdrawals and assessed fees).

Consolidation, Deconsolidation and Reporting of Discontinued Operations

     Our consolidated  financial statements include the accounts of the Company,
its  subsidiaries  (with the exception of LPLA which was  deconsolidated  during
2002, and BCM and LPA which were  deconsolidated  during the first half of 2003,
as  discussed  below),  the Employee  Share  Option Trust and the Agent  Loyalty
Opportunity Trust (collectively, the "Group"). Significant subsidiaries included
in the  continuing  operations  of the  Group  and  discussed  in this Form 10-K
include  London Pacific  Assurance  Limited and Berkeley  International  Capital
Corporation.  All  intercompany  transactions  and  balances are  eliminated  in
consolidation  except  for  intercompany  transactions  between  continuing  and
discontinued  operations  principally related to investment management fees from
LPLA  (the   discontinued   operations)  to  the  continuing   operations.   Our

                                       22
<PAGE>


consolidated  balance  sheet  is  presented  in an  unclassified  format  as the
majority of the Group's  assets  relate to its  continuing  life  insurance  and
annuities business.

     In  accordance  with  Statement  of Financial  Accounting  Standard No. 144
("SFAS 144"),  "Accounting for the Impairment or Disposal of Long-Lived Assets,"
if a long-lived  asset or  "component of an entity" (a  reportable  segment,  an
operating segment, a reporting unit, a subsidiary or an asset group) is disposed
of by sale or by  abandonment,  then the results of operations of that component
of an  entity  shall  be  reported  in  discontinued  operations  if both of the
following conditions are met: (i) the operations and cash flows of the component
have been  eliminated  from the ongoing  operations of the entity,  and (ii) the
entity will not have any significant continuing involvement in the operations of
the component.

     During the third quarter of 2002,  our U.S. life insurance  company,  LPLA,
was placed under  regulatory  control and  rehabilitation  by the North Carolina
insurance   regulators.   As  we  no  longer  exercise  control  over  LPLA,  we
deconsolidated  LPLA and  recorded a charge to earnings in the third  quarter of
2002 of approximately $38.5 million for losses resulting from the disposition of
LPLA. We will not regain control or receive any benefit from LPLA in the future.
As such,  in  accordance  with SFAS  144,  the  results  of  operations  of LPLA
(pre-rehabilitation)  have been reported in discontinued operations.  Under SFAS
144, the results of operations of a  discontinued  business,  and any impairment
losses related to a discontinued business, are reported separately in the income
statement under discontinued  operations for the current and prior periods,  and
in the prior period balance sheet as total assets of discontinued operations and
total liabilities of discontinued operations.

     The results of  operations  of both BCM and LPA are  reported in the income
statement under discontinued operations for the current and prior periods due to
the sale of each during the second quarter of 2003.  The assets and  liabilities
of both BCM and LPA have been  classified as assets of  discontinued  operations
and  liabilities  of  discontinued  operations in the prior period  consolidated
balance  sheet.  We do not expect to  receive  any  material  amounts of income,
including  earnouts  related  to the  sales  of BCM  and  LPA,  from  our  asset
management or financial advisory services segments in the foreseeable future.


RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

     See Note 2 to the Consolidated  Financial Statements in Item 8 of this Form
10-K for a summary of recently issued accounting pronouncements.


Liquidity and Capital Resources

     Our cash and cash  equivalents  decreased  during  2003 by $0.9  million to
$14.4  million,  WHICH INCLUDES $3.8 MILLION HELD BY LPAL WHICH IS NOT AVAILABLE
TO FUND THE OPERATIONS OR COMMITMENTS OF THE COMPANY OR ITS OTHER  SUBSIDIARIES.
As discussed above, LPAL is a regulated  insurance company,  and as such it must
meet  stringent   capital  adequacy   requirements  and  it  may  not  make  any
distributions  without the consent of LPAL's independent actuary.  This decrease
in cash and  cash  equivalents  resulted  from  $21.6  million  of cash  used in
financing activities, partially offset by $12.8 million and $7.5 million of cash
provided by investing activities and operating  activities,  respectively.  Cash
used in financing  activities  related to the repayment of bank  borrowings,  as
well as insurance policyholder benefits paid by LPAL. Cash provided by investing
activities primarily related to the disposals of BCM and LPA, and to the sale or
maturity  of  corporate  bonds by  LPAL,  partially  offset  by the  payment  of
guarantee  obligations  under the bank  facility  and the  purchase of corporate
bonds by LPAL. Cash provided by operating activities primarily resulted from the
sale of  trading  securities.  As of  December  31,  2003,  our  cash  and  cash
equivalents,  excluding the amount held by LPAL,  amounted to $10.6  million,  a
decrease of $0.9 million from  December  31, 2002 and a $47.0  million  decrease
from December 31, 2001. Excluding LPAL's investments,  we also held $3.4 million
of listed equity  securities  which could be sold within a short period of time,
as of December  31,  2003,  compared to $7.7 million as of December 31, 2002 and
$24.4 million as of December 31, 2001.

                                       23
<PAGE>

     Shareholders'  equity  increased  during 2003 by $13.4  million  from $21.5
million at December 31, 2002 to $34.9 million as of December 31, 2003, primarily
due to net income for the period of $11.0  million,  in addition to the positive
change in unrealized gains and losses on  available-for-sale  securities of $1.9
million included in accumulated other comprehensive income (loss). Shareholders'
equity  decreased  during 2002 by $200.2 million from $221.7 million at December
31, 2001 to $21.5 million at December 31, 2002,  primarily due to a net loss for
the period of $205.5  million and payment of the final dividend for 2001 of $2.0
million. As of December 31, 2003 and 2002, $63.6 million of our Ordinary Shares,
at  cost,  held  by  the  employee  benefit  trusts  have  been  netted  against
shareholders' equity.

     On December 20, 2002,  we and the Bank of Scotland  agreed to the terms and
conditions  of an amended  credit  facility,  providing  up to $23.0  million of
borrowings.  The  facility  limit was to be reduced at the end of each  calendar
quarter,  such that the facility was to be repaid in full no later than December
31, 2003.

     As of December 31, 2002, $9.3 million was  outstanding  under the facility.
In addition, $10.6 million of the remaining $10.7 million under the facility was
utilized in the form of guarantees provided on behalf of certain former investee
companies.  As we believed  that it would be unlikely  that the former  investee
companies would have the ability to repay any of their  borrowings  during 2003,
we recorded the maximum  guarantee  obligation  of $10.6 million at December 31,
2002 on our consolidated balance sheet and took other-than-temporary  impairment
losses on the related investments in our consolidated income statement for 2002.
During  February 2003, we sold certain of our listed equity  securities for $4.7
million and used the proceeds to reduce our  borrowings  to $4.4 million and the
facility to $15.0 million.

     On May 7, 2003,  we  completed  the sale of BCM and  received  initial sale
proceeds of $8.06 million.  On May 8, 2003, we paid $7.75 million to the Bank of
Scotland  which  reduced  our  borrowings  to zero and the amounts due under our
guarantee obligations to $7.25 million.

     On June 5, 2003,  we completed  the sale of LPA and  received  initial sale
proceeds of $6.95 million.  On that same date, we paid $6.95 million to the Bank
of Scotland  which  reduced the amounts due under our guarantee  obligations  to
$0.3 million. On June 20, 2003, using our existing cash resources,  we paid $0.3
million  to the  Bank of  Scotland  and the  facility  was  reduced  to zero and
terminated.

     During 2002, LPLA paid investment  management fees to our asset  management
and venture capital segments  totaling $3.6 million.  Due to the loss of control
of  LPLA as  more  fully  described  in  Note 1 and  Note 3 to the  Consolidated
Financial  Statements  in Item 8 of this Form 10-K,  we no longer  manage LPLA's
portfolio of public  corporate bonds and private equity and debt investments and
no longer receive investment management fees for these services.

     We are not aware of any  obligations  we may have to cover any  current  or
future losses of LPLA.  However,  in the course of the administration of LPLA in
rehabilitation, during November 2002, the North Carolina Department of Insurance
("NCDOI")  requested  information  concerning the history of a limited number of
investments in securities of portfolio  companies.  These portfolio  investments
have  been  associated  with  LPLA  for  more  than  seven  years,  and  involve
intercompany  transfers.   The  history  of  their  investment  performance  and
ownership is complex.  We have complied with these requests.  We are not able at
this time to predict what conclusions the NCDOI will reach after evaluating this
information.

     On July,  2002, we announced that LPAL  discontinued  issuing new policies.
Subsequent to this  announcement and other  announcements  relating to the Group
and LPLA, LPAL policy surrenders substantially  increased.  Approximately 80% of
LPAL's $140.2 million in  policyholder  liabilities as of June 30, 2002 had been
surrendered  or had  matured  as of  December  31,  2003.  During  2003,  policy
surrenders  totaled $1.1 million and policy  maturities  totaled $10.4  million.
Policyholder  liabilities as of December 31, 2003 were $28.1 million.  We do not
expect significant  surrender activity during 2004; however,  approximately $8.9
million of policyholder  liabilities are scheduled to mature during 2004.  These
maturities  are expected to be met by a combination  of cash held as of December
31, 2003 of $3.8 million,  the proceeds from maturing  bonds which are estimated
to be $4.8  million  during 2004,  and  estimated  bond  interest to be received
during 2004 of $1.9  million.  Assuming no  significant  surrenders,  investment
income  should  approximately  equal 89% of the  projected  $1.4  million  to be
credited to policies  during 2004.

                                       24
<PAGE>

     During  2003,  LPAL  continued to service its  policyholders.  Policyholder
liabilities for LPAL fell during 2003 from $35.4 million as of December 31, 2002
to $28.1 million as December 31, 2003. As of December 31, 2003, LPAL's corporate
bonds, cash and accrued interest totaled $30.2 million, listed equity securities
were $13.5  million  and the book value of private  equity  securities  was $4.2
million.  Due to the weakened economic  environment,  in February 2003, the JFSC
amended  LPAL's  insurance  permit such that private equity  investments  are no
longer approved assets. Therefore, declines in the market value of LPAL's listed
equity  securities,  which totaled $13.5 million as of December 31, 2003,  could
have a significant impact on LPAL's statutory capital level. If LPAL's statutory
capital falls below the minimum  solvency level required by the Jersey insurance
regulators, we may be required to inject additional capital into LPAL. A capital
injection would be limited to the extent any shortfall  arises from a decline in
the value of LPAL's  listed  equity  securities  that are  required  to  support
minimum solvency. As of December 31, 2003,  approximately $2.9 million of LPAL's
listed  equity   holdings   were  required  to  support  the  minimum   solvency
requirement.

     As of December 31, 2003,  we had no material  commitments  outstanding  for
capital   expenditures  or  additional  funding  for  private  equity  portfolio
companies.

     As  discussed  above,  we have  fully  repaid our bank  borrowings  and our
guarantee  obligations have been satisfied,  and as of December 31, 2003, we had
$10.6  million  of cash and cash  equivalents,  excluding  cash held by our life
insurance and annuities segment. We believe that this cash balance is sufficient
to fund our operations (venture capital and corporate  activities) over the next
12 months.  We also expect to receive $1.0 million in cash out of escrow related
to the sale of LPA by the end of 2004 as discussed in Note 1 to the Consolidated
Financial Statements in Item 8 of this Form 10-K.


CONTRACTUAL OBLIGATIONS AND CONTINGENT LIABILITIES AND COMMITMENTS

     The following  table  aggregates our expected  contractual  obligations and
commitments subsequent to December 31, 2003.
<TABLE>
<CAPTION>
                                                                          2005 -       2007 -     Beyond
Contractual obligations (1)                                    2004       2006         2008        2008       Total
-------------------------------------                       ----------  ----------  ----------  ----------  ----------
                                                                                  (In thousands)

<S>                                                         <C>         <C>         <C>         <C>         <C>
Deferred annuity policy maturities...........               $    8,353  $   17,880  $    3,238  $      134  $   29,605
Capital lease commitments (2)................                        8           7           -           -          15
Operating lease commitments (3)..............                      263         229         228         172         892
                                                            ----------  ----------  ----------  ----------  ----------
Total contractual cash obligations...........               $    8,624  $   18,116  $    3,466  $      306  $   30,512
                                                            ----------  ----------  ----------  ----------  ----------
                                                            ----------  ----------  ----------  ----------  ----------
<FN>
(1) Does not include other commitments for the purchase of goods and services which in the aggregate are immaterial.

(2) Includes amounts classified as interest.

(3) Includes lease  commitments on our San Francisco office lease which expire in April 2004. We are currently  evaluating
    alternative office space in San Francisco for which [no commitment has been entered into as of the date of filing of
    this Form 10-K.]
</FN>
</TABLE>


Item 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The nature of our businesses  exposes us to market risk. Market risk is the
risk of loss that may occur when  changes in  interest  rates and public  equity
prices adversely affect the value of invested assets.

Interest Rate Risk

     LPAL is subject to risk from interest rate  fluctuations  when payments due
to  policyholders  are not matched in respect of amount and duration with income
from investments.  LPAL attempts to minimize this risk

                                       25
<PAGE>



by ensuring  that  payments and income are matched as closely as possible  while
also  maximizing  investment  returns.  LPAL has not used  derivative  financial
instruments as part of its investment  strategy.  Exposure to interest rate risk
is estimated by performing sensitivity tests to changes in interest rates.

     For LPAL's business,  the amount of policyholder  liabilities is unaffected
by  changes in  interest  rates.  Given the  existing  policy and bond  maturity
profiles,  and that bonds will  generally  be held to maturity  and early policy
redemptions  are protected by a market value  adjustment and surrender  penalty,
the bonds and policies  carry no interest rate risk.  Interest  income earned on
excess cash is expected to yield less than $0.1 million  during 2004.  Movements
in market interest rates will not have any material impact on this amount.

Equity Price Risk

     We are  exposed  to equity  price  risk on our  holdings  of listed  equity
securities. Changes in the level or volatility of equity prices affect the value
of the listed  equity  securities.  These  changes in turn  directly  affect our
consolidated  net income  because our holdings of listed equity  securities  are
marked to market,  with changes in their market value  recognized  in the income
statement  for the  period in which  the  changes  occur.  These  listed  equity
securities are in small  capitalization  stocks in the volatile high  technology
industry sector.

     If the fair value of our listed equities, as of December 31, 2003 and 2002,
which  totaled  $16.9  million and $16.5  million,  respectively,  had  abruptly
increased or decreased  by 50%,  the fair value of the listed  equity  portfolio
would  have   increased  or   decreased  by  $8.5  million  and  $8.3   million,
respectively. The largest of these listed equities represented $16.3 million and
$11.4  million of the total as of December 31, 2003 and 2002,  respectively.  If
the fair value of the largest listed equity had abruptly  increased or decreased
by 50%,  its fair value would have  increased  or  decreased by $8.2 million and
$5.7 million, respectively.

     Our listed equity  securities  represent  investments  that were originally
made as private equity  investments in companies that subsequently  completed an
initial public offering.  The performance of these listed equity  securities can
be highly volatile;  however, we monitor them daily and seek to sell them over a
period of time.

     As of December 31, 2003, we held $4.3 million in private  corporate  equity
securities  of  technology  companies  for which  liquid  markets  do not exist.
Private equity prices do not fluctuate directly with public equity markets,  but
significant  market  movements  may  trigger a review  for  other-than-temporary
adjustment of the carrying  values of our private equity  securities.  The risks
inherent in these private equity  investments  relate primarily to the viability
of the  investee  companies.  We try to  mitigate  these  risks in various  ways
including performing extensive due diligence prior to making an investment,  and
regularly reviewing the progress of the investee companies.

     For additional information relating to our financial risk profile, see Note
16 to the Consolidated Financial Statements in Item 8 of this Form 10-K.

                                       26
<PAGE>


Item 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                                                             Page

<S>                                                                                                           <C>
Reports of Independent Certified Public Accountants.........................................................  28

Consolidated Balance Sheets as of December 31, 2003 and 2002................................................  30

Consolidated Statements of Income for the Years Ended
   December 31, 2003, 2002 and 2001.........................................................................  31

Consolidated Statements of Cash Flows for the Years Ended
   December 31, 2003, 2002 and 2001.........................................................................  33

Consolidated Statements of Changes in Shareholders' Equity for the Years Ended
   December 31, 2003, 2002 and 2001.........................................................................  35

Consolidated Statements of Comprehensive Income for the Years Ended
   December 31, 2003, 2002 and 2001.........................................................................  37

Notes to Consolidated Financial Statements..................................................................  38
</TABLE>

                                       27
<PAGE>



               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



Board of Directors and Shareholders of
Berkeley Technology Limited
Jersey, Channel Islands


     We have audited the  accompanying  consolidated  balance sheets of Berkeley
Technology  Limited  (the  "Company")  as of December  31, 2003 and 2002 and the
related consolidated statements of income, changes in shareholders' equity, cash
flows, and  comprehensive  income for the years then ended. We have also audited
the schedules on pages 81 to 86 in Item 15 (the  "Schedules").  These  financial
statements and the Schedules are the responsibility of the Company's management.
Our  responsibility  is to express an opinion on these financial  statements and
the Schedules based on our audits.

     We conducted our audits in accordance  with  auditing  standards  generally
accepted in the United States of America.  Those standards  require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements  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
audits provide a reasonable basis for our opinion.

     In our opinion,  the consolidated  financial  statements  referred to above
present fairly,  in all material  respects,  the financial  position of Berkeley
Technology  Limited  at  December  31,  2003 and 2002,  and the  results  of its
operations  and its cash  flows  for the years  then  ended in  conformity  with
accounting principles generally accepted in the United States of America.  Also,
in our opinion,  the Schedules as of December 31, 2003 and 2002, when considered
in relation to the basic  consolidated  financial  statements  taken as a whole,
present fairly in all material respects, the information set forth therein.

     As discussed in Notes 2 and 7 to the Consolidated Financial Statements, the
Company  changed its method of  accounting  for goodwill in 2002,  in accordance
with  Statement of Financial  Accounting  Standard No. 142,  "Goodwill and Other
Intangible Assets."



/s/  BDO Seidman, LLP
San Francisco, California
January 30, 2004

                                       28
<PAGE>

                        REPORT OF THE INDEPENDENT AUDITORS




To the Board of Directors and Shareholders of
Berkeley Technology Limited


     In  our  opinion,  the  consolidated  financial  statements  listed  in the
accompanying  index present  fairly,  in all material  respects,  the results of
operations of Berkeley  Technology  Limited and its  subsidiaries and their cash
flows for the period  ended  December  31, 2001 in  conformity  with  accounting
principles  generally accepted in the United States of America. In addition,  in
our opinion,  the financial statement schedules listed in the accompanying index
for the period ended December 31, 2001  appearing  under Item 15 on pages 76 and
77, present fairly, in all material respects,  the information set forth therein
when read in conjunction  with the related  consolidated  financial  statements.
These   financial   statements  and  financial   statement   schedules  are  the
responsibility of the Company's management;  our responsibility is to express an
opinion on these financial statements and financial statement schedules based on
our  audit.  We  conducted  our audit of these  statements  in  accordance  with
auditing  standards  generally  accepted in the United States of America,  which
require that we plan and perform the audit to obtain reasonable  assurance about
whether the financial  statements  are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements,  assessing the  accounting  principles
used and  significant  estimates made by management,  and evaluating the overall
financial  statement  presentation.   We  believe  that  our  audit  provides  a
reasonable basis for our opinion.



/s/  PricewaterhouseCoopers
Chartered Accountants
Jersey, Channel Islands
April 1,  2002,  except  for Note 3(a) as for which the date is March 19, 2003
     and Note 3(b) and (c) as for which the date is March 10, 2004

                                       29
<PAGE>




                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                      (In thousands, except share amounts)
<TABLE>
<CAPTION>

                                                                                        December 31,
                                                                                  ------------------------
                                                                                      2003       2002(1)
                                                                                  -----------  -----------
                                            ASSETS

<S>                                                                               <C>          <C>
Investments (principally of life insurance subsidiary):
   Fixed maturities:
     Available-for-sale, at fair value (amortized cost: $25,403 and $30,481
       as of December 31, 2003 and 2002, respectively)............................ $   25,393   $   30,335
   Equity securities:
     Trading, at fair value (cost: $4,544 and $26,785 as of December 31,
       2003 and 2002, respectively) ..............................................     16,882       16,505
     Available-for-sale, at estimated fair value (cost: $4,262 and $8,980 as of
       December 31, 2003 and 2002, respectively) .................................      4,262        7,230
                                                                                  -----------  -----------
Total investments ................................................................     46,537(2)    54,070

Cash and cash equivalents ........................................................     14,408(2)    15,308
Cash held in escrow ..............................................................        999            -
Accrued investment income ........................................................        926          900
Property and equipment, net.......................................................        117          189
Other assets .....................................................................        526        1,360
Total assets of discontinued operations ..........................................          -        8,390
                                                                                  -----------  -----------
Total assets ..................................................................... $   63,513   $   80,217
                                                                                  -----------  -----------
                                                                                  -----------  -----------
                        LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Life insurance policy liabilities ................................................ $   28,054   $   35,441
Notes payable ....................................................................          -        9,314
Accounts payable and accruals.....................................................        562          832
Guarantees under bank facility ...................................................          -       10,590
Total liabilities of discontinued operations .....................................          -        2,554
                                                                                  -----------  -----------
Total liabilities ................................................................     28,616       58,731
                                                                                  -----------  -----------
Commitments and contingencies (See Notes 12 and 15)

Shareholders' equity:
Ordinary shares, $0.05 par value per share: 86,400,000 shares authorized;
   64,439,073 shares issued and outstanding as of December 31, 2003
   and 2002.......................................................................      3,222        3,222
Additional paid-in capital .......................................................     68,615       68,394
Retained earnings ................................................................     27,070       16,054
Employee benefit trusts, at cost (13,684,881 shares as of December 31,
   2003 and 2002, respectively) ..................................................    (63,571)     (63,571)
Accumulated other comprehensive loss .............................................       (439)      (2,613)
                                                                                  -----------  -----------
Total shareholders' equity .......................................................     34,897       21,486
                                                                                  -----------  -----------
Total liabilities and shareholders' equity ....................................... $   63,513   $   80,217
                                                                                  -----------  -----------
                                                                                  -----------  -----------
<FN>
(1) Reclassifications have been made related to discontinued operations - see Note 3.

(2) Includes  $43,095 of  investments  and $3,834 of cash and cash  equivalents  in the  Company's  insurance
    subsidiary  (London Pacific Assurance  Limited ("LPAL")) which are not currently  available to fund the
    operations or commitments of the Company or its other subsidiaries.
</FN>
</TABLE>

     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       30
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME
                (In thousands, except per share and ADS amounts)
<TABLE>
<CAPTION>

                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003        2002(1)      2001(1)
                                                                                  -----------  -----------  -----------
Continuing operations:

<S>                                                                               <C>          <C>          <C>
Revenues:
Investment income............................................................     $     1,887  $     6,590  $     8,181
Insurance policy charges (credits)...........................................               6        1,155           (7)
Fee income (2)  .............................................................               -        2,908        9,924
Net realized investment gains (losses).......................................         (15,312)     (21,507)      18,507
Change in net unrealized investment gains and losses on trading
   securities ...............................................................          22,617      (22,483)    (230,981)
                                                                                  -----------  -----------  -----------
                                                                                        9,198      (33,337)    (194,376)
Expenses:
Amounts credited on insurance policyholder accounts..........................           1,922        6,031        6,314
Amortization of deferred policy acquisition costs............................               -        2,952          932
Operating expenses...........................................................           5,553       10,804       17,181
Goodwill amortization and write-offs.........................................               -          389           48
Interest expense.............................................................             676          965        2,182
                                                                                  -----------  -----------  -----------
                                                                                        8,151       21,141       26,657
                                                                                  -----------  -----------  -----------
Income (loss) from continuing operations before income taxes.................           1,047      (54,478)    (221,033)

Income tax expense (benefit).................................................             (42)       1,291        2,107
                                                                                  -----------  -----------  -----------
Income (loss) from continuing operations.....................................           1,089      (55,769)    (223,140)

Discontinued operations:
Loss from discontinued operations, net of income
   tax expense (benefit) of $2, $(4,943) and $(58,550), respectively.........          (1,758)    (111,203)    (121,644)
Income (loss) on disposal of discontinued operations, net of income
   tax expense of $36, $0 and $0, respectively...............................          11,685      (38,532)           -
                                                                                  -----------  -----------  -----------
Income (loss) on discontinued operations.....................................           9,927     (149,735)    (121,644)
                                                                                  -----------  -----------  -----------
Net income (loss)............................................................     $    11,016  $  (205,504) $  (344,784)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
<FN>
(1) Reclassifications have been made related to discontinued operations - see Note 3.

(2) Amounts represent revenues earned from an entity included in discontinued operations.
</FN>
</TABLE>



     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       31
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                  CONSOLIDATED STATEMENTS OF INCOME (Continued)
                (In thousands, except per share and ADS amounts)
<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003        2002(1)      2001(1)
                                                                                  -----------  -----------  -----------

Basic earnings (loss) per share and ADS: (2)

Basic earnings (loss) per share:
<S>                                                                               <C>          <C>          <C>
Continuing operations........................................................     $      0.02  $     (1.10) $     (4.38)
Discontinued operations......................................................            0.20        (2.95)       (2.38)
                                                                                  -----------  -----------  -----------
                                                                                  $      0.22  $     (4.05) $     (6.76)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
Basic earnings (loss) per ADS: (2)
Continuing operations........................................................     $      0.21  $    (10.99) $    (43.77)
Discontinued operations......................................................            1.96       (29.50)      (23.85)
                                                                                  -----------  -----------  -----------
                                                                                  $      2.17  $    (40.49) $    (67.62)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------

Diluted earnings (loss) per share and ADS: (2)

Diluted earnings (loss) per share:
Continuing operations........................................................     $      0.02  $     (1.10) $     (4.38)
Discontinued operations......................................................            0.20        (2.95)       (2.38)
                                                                                  ------------ ------------------------
                                                                                  $      0.22  $     (4.05) $     (6.76)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
Diluted earnings (loss) per ADS: (2)
Continuing operations........................................................     $      0.21  $    (10.99) $    (43.77)
Discontinued operations......................................................            1.94       (29.50)      (23.85)
                                                                                  -----------  -----------  -----------
                                                                                  $      2.15  $    (40.49) $    (67.62)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
<FN>
(1)  Reclassifications have been made related to discontinued operations - see Note 3.

(2)  ADS amounts have been restated to reflect the one-for-ten reverse split in June 2002.
</FN>
</TABLE>



     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       32
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003        2002 (1)     2001 (1)
                                                                                  -----------  -----------  -----------
Cash flows from continuing operating activities:
<S>                                                                               <C>          <C>          <C>
Net income (loss)............................................................     $     1,089  $   (55,769) $  (223,140)

Adjustments to reconcile net income (loss) to net
   cash provided by (used in) operating activities:
Depreciation and amortization ...............................................              79          460          131
Amortization of deferred policy acquisition costs ...........................               -        2,952          932
Deferred income tax expense .................................................               -        2,898           14
Interest credited on insurance policyholder accounts.........................           1,922        6,031        6,314
Net realized investment losses (gains).......................................          15,312       21,507      (18,507)
Change in net unrealized investment gains and losses
   on trading securities.....................................................         (22,617)      22,483      230,981
Net amortization of investment premiums and discounts........................             313          289          311
Stock based employee compensation expense....................................               -            -          530

Net changes in operating assets and liabilities:
   Trading equity securities.................................................          11,879       32,623      (92,558)
   Accrued investment income ................................................             (26)       2,314       (1,284)
   Deferred policy acquisition costs ........................................               -         (250)      (2,142)
   Other assets .............................................................             733          391        2,096
   Life insurance policy liabilities.........................................              (6)           4          175
   Accounts payable, accruals and other liabilities .........................            (804)      (3,196)      (5,863)
   Income taxes payable .....................................................             (26)      (3,034)         334

Other operating cash flows ..................................................             223         (471)       1,348
                                                                                  -----------  -----------  -----------
Net cash provided by (used in) continuing operations ........................           8,071       29,232     (100,328)
                                                                                  -----------  -----------  -----------
Write-off of doubtful receivables from discontinued operations...............               -      (15,614)           -
Capital paid in to discontinued operations...................................            (523)      (3,050)     (50,815)
Amounts due from (to) discontinued operations................................               -       (2,793)      22,015
                                                                                  -----------  -----------  -----------
Net cash used in discontinued operations ....................................            (523)     (21,457)     (28,800)
                                                                                  -----------  -----------  -----------
Net cash provided by (used in) operating activities .........................           7,548        7,775     (129,128)
                                                                                  -----------  -----------  -----------
Cash flows from investing activities:
Payment of guarantee obligations.............................................         (10,836)           -            -
Purchases of held-to-maturity fixed maturity securities .....................               -       (2,828)      (1,959)
Purchases of available-for-sale fixed maturity securities ...................         (17,096)      (7,447)     (80,190)
Purchases of available-for-sale equity securities............................               -            -      (16,000)
Proceeds from redemption of held-to-maturity fixed maturity securities.......               -            -        1,733
Proceeds from sale and maturity of available-for-sale fixed
   maturity securities ......................................................          24,595       96,884        3,664
Proceeds from sale of available-for-sale equity securities ..................               9            -      149,358
Proceeds from disposal of discontinued operations............................          16,148            -            -
Capital expenditures.........................................................              (4)         (16)         (96)
                                                                                  -----------  -----------  -----------
Net cash provided by investing activities ...................................          12,816       86,593       56,510
                                                                                  -----------  -----------  -----------
<FN>
(1)   Reclassifications have been made related to discontinued operations - see Note 3.
</FN>
</TABLE>

     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       33
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
                                 (In thousands)
<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003        2002 (1)     2001 (1)
                                                                                  -----------  -----------  -----------

Cash flows from financing activities:
<S>                                                                               <C>          <C>          <C>
Insurance policyholder contract deposits ....................................               -        6,827       74,368
Insurance policyholder benefits paid ........................................         (12,330)    (117,063)      (2,999)
Issuance of Ordinary Shares .................................................               -            -            3
Purchases of Ordinary Shares by the employee benefit trusts..................               -            -       (6,005)
Proceeds from disposal of shares by the employee benefit trusts..............               -           43          440
Dividends paid ..............................................................               -       (2,032)     (11,802)
Proceeds from issuance of notes payable......................................               -        2,440            -
Repayments of notes payable..................................................          (9,314)     (30,000)           -
                                                                                  -----------  -----------  -----------
Net cash provided by (used in) financing activities .........................         (21,644)    (139,785)      54,005
                                                                                  -----------  -----------  -----------

Net decrease in cash and cash equivalents ...................................          (1,280)     (45,417)     (18,613)
Cash and cash equivalents at beginning of year (2) ..........................          15,308       60,571       79,221
Foreign currency translation adjustment .....................................             380          154          (37)
                                                                                  -----------  -----------  -----------
Cash and cash equivalents at end of year (2), (3)............................     $    14,408  $    15,308  $    60,571
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------


Supplemental disclosure of cash flow information: (2)

Cash paid (received) during the year for:
Interest ....................................................................     $       501  $       956  $       865
Income taxes (net of amounts recovered) .....................................     $       (51) $     1,408  $     1,575

Supplemental disclosure of non-cash investing activities:
Exchange of available-for-sale equity securities for trading equity
   securities................................................................     $         3  $        22  $       117

<FN>
(1)   Reclassifications have been made related to discontinued operations - see Note 3.

(2)   Amounts reflect continuing operations only.  Does not include $999 of cash held in escrow as of December 31, 2003.

(3)   The amount for December 31, 2003 includes $3,834 in the Company's  insurance  subsidiary (LPAL) which is not currently
      available to fund the operations or commitments of the Company or its other subsidiaries.
</FN>
</TABLE>

     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       34
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
                (In thousands, except per share and ADS amounts)

<TABLE>
<CAPTION>
                                                                                        Accumulated
                                                                                           Other
                                   Ordinary Shares    Additional              Employee    Compre-      Total
                                --------------------    Paid-in    Retained    Benefit     hensive  Shareholders'
                                  Number     Amount     Capital    Earnings    Trusts       Loss       Equity
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
<S>                                <C>     <C>        <C>         <C>         <C>        <C>         <C>
Balance as of January 1, 2001      64,433  $   3,222  $   67,591  $  580,176  $ (58,003) $  (25,244) $  567,742

Net loss........................        -          -           -    (344,784)         -           -    (344,784)
Change in net unrealized
   gains and losses on
   available-for-sale securities        -          -           -           -          -      15,453      15,453
Foreign currency translation
   adjustment...................        -          -           -           -          -        (115)       (115)
Exercise of employee share
   options, including income
   tax effect...................        6          -         191           -        409           -         600
Grant of employee share
   options below fair market
   value........................        -          -         530           -          -           -         530
Net realized gains on
   disposal of shares held by
   the employee benefit trusts..        -          -          31           -          -           -          31
Cash dividends (23.2 cents
   net per share and $2.32
   per ADS)(1)..................        -          -           -     (11,802)         -           -     (11,802)
Issuance of Ordinary Shares.....        -          -           3           -          -           -           3
Purchase of shares by the
   employee benefit trusts......        -          -           -           -     (6,005)          -      (6,005)
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
Balance as of
   December 31, 2001............   64,439  $   3,222  $   68,346  $  223,590  $ (63,599) $   (9,906) $  221,653
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------

Net loss........................        -  $       -  $        -  $ (205,504) $       -  $        -  $ (205,504)
Change in net unrealized
   gains and losses on
   available-for-sale securities        -          -           -           -          -       7,853       7,853
Foreign currency translation
   adjustment...................        -          -           -           -          -        (560)       (560)
Exercise of employee share
   options, including income
   tax effect...................        -          -           3           -         28           -          31
Warrants issued to bank.........        -          -          30           -          -           -          30
Net realized gains on disposal
   of shares held by the
   employee benefit trusts......        -          -          15           -          -           -          15
Cash dividends ($0.04 net
   per share and $0.40 per
   ADS) (1).....................        -          -           -      (2,032)         -           -      (2,032)
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
Balance as of
   December 31, 2002............   64,439  $   3,222  $   68,394  $   16,054  $ (63,571) $   (2,613) $   21,486
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
<FN>
(1)  ADS amounts have been restated to reflect the one-for-ten reverse split in June 2002.
</FN>
</TABLE>


     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       35
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

     CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Continued)
                (In thousands, except per share and ADS amounts)
<TABLE>
<CAPTION>

                                                                                        Accumulated
                                                                                           Other
                                    Ordinary Shares   Additional              Employee    Compre-       Total
                                --------------------   Paid-in     Retained    Benefit    hensive   Shareholders'
                                 Number     Amount     Capital     Earnings    Trusts      Loss        Equity
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------

<S>                                <C>     <C>        <C>         <C>         <C>        <C>         <C>
Balance as of January 1, 2003...   64,439  $   3,222  $   68,394  $   16,054  $ (63,571) $   (2,613) $   21,486

Net income......................        -          -           -      11,016          -           -      11,016
Change in net unrealized
   gains and losses on
   available-for-sale securities        -          -           -           -          -       1,886       1,886
Foreign currency translation
   adjustment...................        -          -           -           -          -         288         288
Warrants issued to bank ........        -          -         221           -          -           -         221
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
Balance as of
   December 31, 2003............   64,439  $   3,222  $   68,615  $   27,070  $ (63,571) $     (439) $   34,897
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------
                                ---------  ---------  ----------  ----------  ---------  ----------  ----------

</TABLE>


     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       36
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                 (In thousands)
<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------

<S>                                                                               <C>          <C>          <C>
Net income (loss)............................................................     $    11,016  $  (205,504) $  (344,784)

Other comprehensive income, net of deferred income taxes:

Foreign currency translation adjustments, net of income taxes of $0...........            288         (560)        (115)

Change in net unrealized gains and losses related to continuing operations:
   Unrealized holding gains and losses on available-for-sale securities......              54       (1,116)      (1,623)
   Less: reclassification adjustment for gains and losses included in
     net income (loss).......................................................           1,832          366          836
   Deferred policy acquisition cost amortization adjustments.................               -         (551)         405

Change in net unrealized gains and losses related to discontinued operations:
   Change in net unrealized gains and losses on available-for-sale
     securities..............................................................               -        5,744       35,583
   Deferred policy acquisition cost amortization adjustments.................               -       (8,044)     (13,398)
   Deferred income taxes.....................................................               -          805       (6,350)
   Reclassification adjustment for losses of discontinued
     operations included in net income (loss)................................               -       10,649            -
                                                                                  -----------  -----------  -----------
Other comprehensive income ..................................................           2,174        7,293       15,338
                                                                                  -----------  -----------  -----------
Comprehensive income (loss) .................................................     $    13,190  $  (198,211) $  (329,446)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>





     See  accompanying  Notes which are an integral  part of these  Consolidated
Financial Statements.

                                       37
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1.   Material Events

     The  Ordinary  Shares of Berkeley  Technology  Limited (the  "Company"  and
together  with its  subsidiaries,  the  "Group")  are traded on the London Stock
Exchange and on the  Over-the-Counter  ("OTC") Bulletin Board in the U.S. in the
form of American  Depositary  Shares  ("ADSs"),  which are evidenced by American
Depositary  Receipts  ("ADRs").  During the second  quarter of 2002, the Company
completed a  one-for-ten  reverse  split of its ADSs.  Each ADS  represents  ten
Ordinary Shares.

     On July 2, 2002,  the Company  announced  that declines in the value of the
investment  portfolio of London  Pacific Life & Annuity  Company  ("LPLA"),  the
Group's  primary  insurance  company,  due to persistent  negative events in the
equity and bond markets,  continued to erode significantly the statutory capital
of LPLA and that the Group had been  unsuccessful in concluding a transaction to
enhance the capital of LPLA. As a consequence, LPLA discontinued the issuance of
new policies as of July 2, 2002.  Although the statutory  capital of the Group's
Jersey insurance subsidiary,  London Pacific Assurance Limited ("LPAL"), had not
been  affected by the adverse  equity and bond markets to the same extent as the
statutory  capital of LPLA, the Company also announced on July 2, 2002 that LPAL
would discontinue  writing new policies effective  immediately.  The decision to
discontinue  the  issuance of new  policies  through  LPAL was made to avoid the
increased capital requirements created by additional  policyholder  liabilities.
Subsequent to this announcement and other announcements  relating to the Company
and LPLA, LPAL policy surrenders increased  substantially.  Approximately 80% of
LPAL's $140.2 million in  policyholder  liabilities as of June 30, 2002 had been
surrendered  or had matured as of December  31,  2003.  Of the $35.4  million in
policyholder liabilities remaining at December 31, 2002, 18% matured and 3% were
surrendered during 2003.

     During the third quarter of 2002, LPLA was placed under regulatory  control
and rehabilitation  based on LPLA's statutory capital and surplus as of June 30,
2002.  On August 6, 2002,  on petition of the  Commissioner  of Insurance of the
State of North  Carolina (the  "Commissioner")  with the  unanimous  approval of
LPLA's board of  directors,  the  Superior  Court of Wake County in the State of
North Carolina ordered the Commissioner to take possession and control of all of
the property, books and accounts,  documents and other records of LPLA. Based on
this court order, the Company no longer exercises control over LPLA. As a result
of this event, the Company deconsolidated LPLA and recorded a charge to earnings
in the third  quarter of 2002 of $38.5  million  for losses  resulting  from the
disposition  of  LPLA.  For  further  information,   see  Note  3  "Discontinued
Operations" below.

     On March 7, 2003,  the Group  entered into a  definitive  agreement to sell
substantially  all of the assets and operations of Berkeley  Capital  Management
("BCM"), its U.S. based asset management subsidiary.  Consequently,  the Company
deconsolidated  BCM as of March 31, 2003 and BCM's  results of  operations  were
reported separately in the income statement under discontinued  operations since
the first quarter of 2003.

     On May 7, 2003, the Group  completed the sale of  substantially  all of the
assets and  operations  of BCM to a company  majority-owned  by funds  under the
management  of Putnam  Lovell NBF Private  Equity.  The Group  received  initial
proceeds  of $8.06  million in cash at the  closing of the  transaction,  and an
additional  $0.08  million in cash,  representing  a purchase  price  adjustment
pursuant to the sale agreement,  in July 2003. The Group received a further $1.0
million in cash on December 30, 2003.  The Group has been  notified that it will
not receive any of the $1.25  million in cash  earnout  payments  under the sale
agreement.  The sale agreement  contains certain customary  indemnities given by
the Group to the  purchaser,  such as for any claims related to the period prior
to  closing  of the  transaction.  The Group has not been  notified  of any such
claims.   At  the  time  of  the  sale,   BCM's  assets  under  management  were
approximately  $1.2  billion.  The Group  recognized a book gain on sale of $7.9
million  in the second  quarter of 2003.  For  further  information,  see Note 3
"Discontinued Operations" below.

                                       38
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     On May 9, 2003,  the Group entered into a definitive  agreement to sell all
of the  outstanding  stock of London Pacific  Advisory  Services,  Inc.,  London
Pacific  Securities,  Inc. and LPA  Insurance  Agency,  Inc.  together  with the
associated   assets  of  the  advisory   business  held  within  London  Pacific
Technologies,  Inc.  and LP  Advisors,  Inc.  (collectively,  "LPA"  or the "LPA
business") for total  consideration  of up to $16.2  million,  to a wholly-owned
subsidiary of SunGard Data Systems Inc. ("SunGard").  On June 5, 2003, this sale
was completed and the Group received $6.95 million in cash consideration  (which
excluded  $1.25 million held back to cover any  shortfall to the agreed  minimum
tangible net asset value of the LPA assets minus the liabilities acquired in the
transaction,  and to cover any indemnity  obligations).  In September  2003, the
Group  received  $0.06 million out of the $0.25 million  holdback after agreeing
the LPA tangible net asset value with SunGard.  The remaining  $1.0 million held
will be used to cover any  indemnity  obligations  arising  within  the 18 month
period following the close of the transaction.  SunGard did not assume LPA's net
liability  of  $10.6  million  to  Berkeley  International  Capital  Corporation
("BICC"),  another Group subsidiary.  The Group may receive up to a further $8.0
million  cash  earnout  payment  that will be equal in amount to one-half of the
cumulative  operating  profits  from the LPA  business  in the three year period
immediately  following closing of the sale to SunGard. This earnout payment will
be paid within  approximately  60 days  following the third  anniversary  of the
closing of the  transaction.  There is no guarantee  that the Group will receive
any  portion  of the  earnout  payment.  The  sale  agreement  contains  certain
customary  indemnities  given  by the  Group to the  purchaser,  such as for any
claims related to the period prior to closing of the  transaction.  The Group is
not aware of any unresolved  claims. At the time of the sale, LPA's assets under
management,  consulting or administration  were approximately $2.6 billion.  The
Group  recognized a book gain on sale of $3.7  million in the second  quarter of
2003. For further information, see Note 3 "Discontinued Operations" below.

     Subsequent  to the sale of the  Company's  asset  management  and financial
advisory  services  businesses,  the  Company  now  focuses  on  rebuilding  its
technology  venture capital business.  At its annual general meeting on June 12,
2003, the Company obtained  shareholder  approval to change its name from London
Pacific Group Limited back to Berkeley Technology Limited, which was the name of
the Company in 1985 when it first  became a public  company on the London  Stock
Exchange. The name change became effective on June 16, 2003.


Note 2.    Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

     The accompanying  consolidated  financial  statements have been prepared by
the Company in  conformity  with United  States  generally  accepted  accounting
principles ("U.S.  GAAP").  These consolidated  financial statements include the
accounts of the Company,  its subsidiaries  (with the exception of LPLA, BCM and
LPA as discussed above in Note 1 "Material  Events"),  the Employee Share Option
Trust ("ESOT") and the Agent Loyalty  Opportunity  Trust  ("ALOT").  Significant
subsidiaries included in the continuing operations of the Group and discussed in
this  document   include   London   Pacific   Assurance   Limited  and  Berkeley
International  Capital Corporation.  All intercompany  transactions and balances
have been  eliminated  in  consolidation  except for  intercompany  transactions
between continuing and discontinued operations principally related to investment
management fees from LPLA (discontinued operations) to the continuing operations
which are disclosed in Note 3 and Note 21 below.

     During the second  quarter of 2002,  the Company  completed  a  one-for-ten
reverse  split of its ADSs. On June 24, 2002,  every ten of the  Company's  ADSs
issued and outstanding were converted and reclassified  into one post-split ADS.
Consequently,  effective from the opening of business on June 24, 2002, each ADS
is equal to ten Ordinary Shares.  All earnings (loss) per ADS amounts  disclosed
in these financial statements have been restated to reflect this split.

                                       39
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     The  consolidated  balance sheet is presented in an unclassified  format as
the majority of the Group's assets relate to its  continuing  life insurance and
annuities   business.   The  Group's  other  business  is  venture  capital  and
consulting.

     The Company is incorporated under the laws of Jersey,  Channel Islands. Its
Ordinary  Shares are traded on the London Stock  Exchange and in the U.S. on the
OTC Bulletin Board in the form of ADSs, which are evidenced by ADRs. Pursuant to
the  regulations of the U.S.  Securities and Exchange  Commission  ("SEC"),  the
Company  is  considered  a U.S.  domestic  registrant  and must  file  financial
statements prepared under U.S. GAAP.

Cash and Cash Equivalents

     The Group considers all highly liquid investments with an original maturity
of three months or less to be cash equivalents.

Investments

     The Group's  investments  consist of fixed maturity and equity  securities.
Fixed  maturity  securities  are  classified  as  either  available-for-sale  or
held-to-maturity,  and equity  securities  are  classified as either  trading or
available-for-sale. The investments are accounted for as follows:

     i)   available-for-sale securities are recorded at fair value, with changes
          in unrealized gains and losses excluded from net income,  but reported
          net of  applicable  income taxes and  adjustments  to deferred  policy
          acquisition cost  amortization as a separate  component of accumulated
          other comprehensive income;

     ii)  held-to-maturity  securities  are  recorded at  amortized  cost unless
          these securities become other-than-temporarily impaired; and

     iii) trading  securities  are  recorded  at  fair  value  with  changes  in
          unrealized gains and losses included in net income.

     When a quoted market price is available for a security, the Group uses this
price  in the  determination  of fair  value.  If a quoted  market  price is not
available for a security,  management  estimates the security's fair value based
on appropriate valuation  methodologies.  Management's  valuation  methodologies
include  fundamental  analysis that evaluates the investee company's progress in
developing  products,  building  intellectual  property  portfolios and securing
customer  relationships,  as well as overall industry conditions,  conditions in
and  prospects  for the  investee's  geographic  region,  overall  equity market
conditions,  and the level of financing  already secured and available.  This is
combined  with  analysis of comparable  acquisition  transactions  and values to
determine if the security's liquidation preferences will ensure full recovery of
the  Group's  investment  in a  likely  acquisition  outcome.  In its  valuation
analysis,  management also considers the most recent  transaction in a company's
shares.

     Amortization  of premiums and  accretion  of  discounts  on fixed  maturity
securities  are  reflected  in  earnings  over  the  contractual  terms  of  the
investments in a manner that produces a constant effective yield. Realized gains
and  losses  on  securities  are  included  in net  income  using  the  specific
identification  method. Any  other-than-temporary  declines in the fair value of
available-for-sale or held-to-maturity  securities,  below the cost or amortized
cost basis, are recognized as realized losses in the consolidated  statements of
income.  The cost basis of such securities is adjusted to reflect the write-down
recorded.

                                       40
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Deferred Policy Acquisition Costs

     Policy  acquisition  costs are the costs of producing  life  insurance  and
annuity business:  principally  commissions and certain marketing expenses which
vary with, and are primarily related to, the acquisition of new business. Policy
acquisition  costs are deferred and amortized  over the  estimated  lives of the
policies in relation to their  estimated  future gross profits.  Amortization is
adjusted in the current year when estimates of total profits to be realized from
a group of products are revised.

     Deferred  policy   acquisition   costs  are  adjusted  for  the  change  in
amortization  that  would  have  been  recorded  if  fixed  maturity  securities
classified as  available-for-sale  had been sold at their stated  aggregate fair
value  and the  proceeds  reinvested  at  current  yields.  The  impact  of this
adjustment  is  included  in  accumulated  other  comprehensive   income  within
shareholders' equity.

     From  July  2,  2002,  the  Company's  life  insurance  subsidiary,   LPAL,
discontinued writing new policies. As of September 30, 2002, all deferred policy
acquisition costs were written off.

Property, Equipment and Leasehold Improvements

     Property,  equipment  and  leasehold  improvements  are stated at cost less
accumulated depreciation. Depreciation is calculated on a straight-line basis at
rates  sufficient to write-off such assets over their estimated  useful lives on
the following basis:

       Furniture and equipment                          -  five years
       Computer equipment, including software           -  three to five years
       Leasehold improvements                           -  life of lease

     Assets held under  capital  leases are included in property,  equipment and
leasehold  improvements  and are depreciated  over their estimated useful lives.
The future  obligations  under these leases are included in accounts payable and
accruals.  Interest  paid on capital  leases is charged to the income  statement
over the periods of the leases.

Goodwill

     Goodwill  is  recorded  at   acquisition  of   subsidiaries.   Goodwill  at
acquisition  arises  where  the  consideration  given  exceeds  the  fair  value
attributed  to the  separable  net  assets.  All  goodwill on  acquisitions  was
capitalized  until January 1, 2002, and amortized on a straight-line  basis over
its estimated  useful economic life,  generally 25 years.  Beginning  January 1,
2002, goodwill is no longer amortized, but is regularly evaluated for impairment
and any impairment  losses are recognized in the consolidated  income statement.
All unamortized goodwill in the continuing  operations was written-off as of the
end of 2002.

Life Insurance Policy Liabilities, Revenues and Expenses

     Life insurance  policy  liabilities,  premium revenues and related expenses
are accounted for in accordance with Statement of Financial Accounting Standards
No.  97,  "Accounting  and  Reporting  by  Insurance   Enterprises  for  Certain
Long-Duration  Contracts  and for  Realized  Gains and  Losses  from the Sale of
Investments," as follows:

                                       41
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     i) Life insurance policy  liabilities for deferred  annuities are accounted
for as investment-type  insurance products and are recorded at accumulated value
(premiums  received,  plus  accrued  interest  to the balance  sheet date,  less
withdrawals and assessed fees).

     ii)  Revenues for  investment-type  insurance  products  consist of charges
assessed against policy account values for surrenders.

     iii) Benefits for investment-type insurance products are charged to expense
when  incurred  and  reflect the claim  amounts in excess of the policy  account
balance.  Expenses for investment-type products include the interest credited to
the policy account balance.

Revenue Recognition

     Interest  income  is  accounted  for on an  accrual  basis.  Dividends  are
accounted for when declared.

     Listed equity  securities  received as a result of an acquisition of one of
the Group's  investee  companies by a publicly  traded  company that are held in
escrow by an escrow agent,  are recognized in the financial  statements when the
transaction is completed.  Reductions are made to the number of shares of listed
equity securities held in escrow that are carried in the financial statements as
claims are made by the  acquiring  company  against the  escrow,  or if evidence
exists that a claim is probable.

     Fees relating to venture  capital  activities are recognized in income when
the  investment  transaction  is  completed.  Fees for  consulting  services are
recognized  in  income  on an  accrual  basis,  based  upon  when  services  are
performed.

Stock Based Compensation

     The Company  accounts for stock based  compensation  issued to employees in
accordance  with  Accounting   Principles  Board  Opinion  No.  25  ("APB  25"),
"Accounting  for Stock Issued to Employees," and related  interpretations  which
recognizes  compensation  expense  based upon the  intrinsic  value of the stock
options  as of the date of  grant.  The  Financial  Accounting  Standards  Board
("FASB")  issued  Statement of  Financial  Accounting  Standards  No. 123 ("SFAS
123"), "Accounting for Stock Based Compensation," which encourages, but does not
require, companies to recognize compensation expense for grants of stock options
based on their fair value. The Company has elected, as permitted by SFAS 123, to
adopt the  disclosure  requirement  of SFAS 123 and to  continue  to account for
stock based compensation under APB 25.

     Had  compensation  expense for the Company's ESOT activity been  determined
based upon the fair value  method in  accordance  with SFAS 123,  the  Company's
consolidated  net income (loss) and earnings (loss) per share and ADS would have
been decreased or increased to the pro forma amounts as reflected below:

                                       42
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                    (In thousands, except per share
                                                                                            and ADS amounts)

<S>                                                                               <C>          <C>          <C>
Net income (loss) as reported................................................     $    11,016  $  (205,504) $  (344,784)
Add: Stock based employee compensation expense included in
   reported income (loss), net of related tax effects........................               -           -           530

Deduct: Total stock based employee compensation expense determined
   under fair value based methods for all awards, net of related tax effects.            (145)        (796)      (5,165)
                                                                                  -----------  -----------  -----------
Pro forma net income (loss) .................................................     $    10,871  $  (206,300) $  (349,419)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------

Basic earnings (loss) per share:
As reported..................................................................            0.22        (4.05)       (6.76)
Pro forma....................................................................            0.21        (4.06)       (6.85)
Basic earnings (loss) per ADS: (1)
As reported..................................................................            2.17       (40.49)      (67.62)
Pro forma....................................................................            2.14       (40.65)      (68.53)
Diluted earnings (loss) per share:
As reported..................................................................            0.22        (4.05)       (6.76)
Pro forma....................................................................            0.21        (4.06)       (6.85)
Diluted earnings (loss) per ADS: (1)
As reported..................................................................            2.15       (40.49)      (67.62)
Pro forma....................................................................            2.12       (40.65)      (68.53)
Weighted-average fair value of options granted
   at market price during year...............................................               -         0.23         2.38
Weighted-average fair value of options granted
   at less than market price during year.....................................               -            -         2.86
<FN>
(1)      ADS amounts have been restated to reflect the one-for-ten reverse split in June 2002.
</FN>
</TABLE>

     The pro forma  disclosures  shown  above were  calculated  for all  options
granted after December 31, 1994 using a Black-Scholes  option pricing model with
the following assumptions:
<TABLE>
<CAPTION>

                                                                                    2003 (1)       2002         2001
                                                                                  -----------  -----------  -----------
<S>                                                                               <C>          <C>          <C>
Expected dividend yield (2)..................................................               -            -            -
Expected stock price volatility..............................................               -         125%          76%
Risk-free interest rate......................................................               -        3.95%        5.09%
Weighted-average expected life (in years)....................................               -            5            5
<FN>
(1) No grants were made in 2003.

(2) As the Company paid a constant dividend amount for 2001, a deduction to the share price was made in the amount of the
    net present value of the dividend and the dividend yield in the option pricing model was set to zero.  For 2002, the
    deduction to the share price was zero, as future dividends have not been assumed.
</FN>
</TABLE>

                                       43
<PAGE>






                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Income Taxes

     The Group  accounts  for  income  taxes in  accordance  with  Statement  of
Financial  Accounting  Standards  No. 109 ("SFAS 109"),  "Accounting  for Income
Taxes." Under SFAS 109, the Group recognizes taxes payable or refundable for the
current  year,  and  deferred  tax  assets  and  liabilities  due  to  temporary
differences in the basis of assets and liabilities  between amounts recorded for
financial statement and tax purposes.

     The Group provides a valuation  allowance for deferred income tax assets if
it is more likely than not that some  portion of the  deferred  income tax asset
will not be realized. The Group includes in income any increase or decrease in a
valuation  allowance that results from a change in  circumstances  that causes a
change in judgment  about the  realization  of the related  deferred  income tax
asset.

     The Group includes in additional  paid-in  capital the tax benefit on share
options  exercised during the period to the extent that such exercises result in
a permanent  difference  between financial  statement and tax basis compensation
expense.

Earnings Per Share and ADS

     The Company  calculates  earnings per share in accordance with Statement of
Financial Accounting Standards No. 128 ("SFAS 128"),  "Earnings per Share." This
statement  requires the  presentation  of basic and diluted  earnings per share.
Basic  earnings  per share is  calculated  by dividing net income or loss by the
weighted-average  number of Ordinary  Shares  outstanding  during the applicable
period,  excluding  shares  held by the ESOT and the ALOT which are  regarded as
treasury  stock for the  purposes  of this  calculation.  The Company has issued
employee share options,  which are considered  potential common stock under SFAS
128. The Company has also issued Ordinary Share warrants to the Bank of Scotland
in connection with the Company's bank facility (now terminated),  which are also
considered  potential common stock under SFAS 128. Diluted earnings per share is
calculated  by dividing  net income by the weighted  average  number of Ordinary
Shares   outstanding   during  the  applicable  period  as  adjusted  for  these
potentially  dilutive  options and warrants  which are  determined  based on the
"Treasury Stock Method."

Foreign Currencies

     The Group uses the (pound) sterling as the functional currency for LPAL and
the U.S.  dollar  as the  functional  currency  for the  Company  and all  other
significant  subsidiaries.  Foreign exchange gains and losses resulting from the
remeasurement  of foreign  currency  assets  and  liabilities  into an  entity's
functional  currency are included in other operating expense in the consolidated
statements of income. For entities using a (pound) sterling functional currency,
assets and  liabilities  denominated in foreign  currencies are translated  into
U.S.  dollars at the  prevailing  exchange  rates at the balance  sheet date and
income and expense  items are  translated  to U.S.  dollars at average  exchange
rates in effect during the period. The resulting translation adjustment is shown
as a separate component of other comprehensive  income in shareholders'  equity.
Foreign  currency  transaction  gains and losses are  recorded in the results of
operations, and were not material in all periods presented.

Comprehensive Income

     Comprehensive  income consists of net income;  changes in unrealized  gains
and losses on  available-for-sale  securities,  net of income taxes and deferred
policy   acquisition  cost  amortization   adjustments;   and  foreign  currency
translation  gains or losses arising on the translation of the Group's  non-U.S.
dollar based subsidiaries.

                                       44
<PAGE>




                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Recently Issued Accounting Pronouncements

     In  January  2003,  the FASB  issued  Interpretation  No.  46  ("FIN  46"),
"Consolidation of Variable Interest  Entities," which requires the consolidation
of variable interest  entities ("VIE"),  as defined in FIN 46. In December 2003,
the FASB completed  deliberations of proposed  modifications to FIN 46 ("Revised
Interpretations")  resulting in multiple  effective dates based on the nature as
well as the creation date of the VIE.  VIEs created after January 31, 2003,  but
prior to January 1, 2004,  may be  accounted  for either  based on the  original
interpretation   or  the   Revised   Interpretations.   However,   the   Revised
Interpretations  must be applied no later than the first  quarter of fiscal year
2004. VIEs created after January 1, 2004 must be accounted for under the Revised
Interpretations.  As of  December  31,  2003,  the Group does not have  entities
meeting the  definition  of a VIE and does not expect the  adoption of FIN 46 to
have an impact on its financial statements.

     In  December  2003,  the FASB  issued  Statement  of  Financial  Accounting
Standard No. 132 (revised 2003) ("SFAS 132(R)"),  Employers'  Disclosures  about
Pensions  and Other  Postretirement  Benefits."  SFAS 132(R) does not change the
measurement  or  recognition  provisions of other FASB  statements  but requires
additional  disclosures  to those in the  original  SFAS 132 about  the  assets,
obligations,  cash  flows,  and net  periodic  benefit  cost of defined  benefit
pension plans and other defined  benefit  postretirement  plans.  As the pension
plan  for  Jersey,  Channel  Islands  employees  is  in  the  process  of  being
terminated,  the Group will not be adopting the disclosure  requirements of SFAS
132(R) in 2004.

Use of Estimates

     The  preparation  of financial  statements  in  conformity  with U.S.  GAAP
requires  management to make estimates and assumptions  that affect the reported
amounts  of assets and  liabilities  and  disclosure  of  contingent  assets and
liabilities as of the date of these consolidated financial statements as well as
the  reported  amount of revenues  and expenses  during this  reporting  period.
Actual results could differ from these estimates. Certain estimates such as fair
value  and  actuarial  assumptions  have a  significant  impact on the gains and
losses recorded on investments and balance of life insurance policy liabilities.

Reclassifications

     Certain  reclassifications  were made to prior year amounts to conform with
the current year's presentation.  These  reclassifications  had no effect on the
net income or shareholders' equity for the prior years.


Note 3.   Discontinued Operations

(a) London Pacific Life & Annuity Company

     As  described  above in Note 1 "Material  Events,"  the  Company,  with the
unanimous  approval of LPLA's board of  directors,  ceded control of LPLA to the
North Carolina insurance regulators on August 6, 2002. In connection  therewith,
the  Company  deconsolidated  LPLA and  recorded a charge to  earnings  of $38.5
million  during  the third  quarter  of 2002.  Although  LPLA was  placed  under
regulatory  control and  rehabilitation,  the Company will not regain control or
receive  any  benefit  from LPLA in the  future.  As such,  in  accordance  with
Statement of Financial Accounting Standard No. 144 ("SFAS 144"), "Accounting for
the  Impairment or Disposal of Long Lived  Assets," the results of operations of
LPLA (pre-rehabilitation)  have been reported in discontinued operations.  Under
SFAS  144,  the  results  of  operations  of a  discontinued  business,  and any
impairment losses related to a discontinued business, are reported separately in
the income  statement  under  discontinued  operations for the current and prior
periods.

                                       45
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     A summary of LPLA's pre-tax  operating results for the years ended December
31, 2002 and 2001, are shown below.
<TABLE>
<CAPTION>
                                                                                  Years ended December 31,
                                                                                  ------------------------
                                                                                    2002 (1)       2001
                                                                                  -----------  -----------
                                                                                      (In thousands)
Revenues:
<S>                                                                                <C>          <C>
Investment income before intercompany management fee expense...................... $   62,453   $  134,758
Intercompany management fee expense (2)...........................................     (3,632)     (11,831)
Other income......................................................................      4,176        7,048
Net realized and change in net unrealized investment gains and losses.............    (97,618)    (164,773)
                                                                                  -----------  -----------
Total revenues and net investment losses..........................................    (34,621)     (34,798)

Expenses:
Interest credited on insurance policyholder accounts..............................     56,133      112,651
Amortization of deferred policy acquisition costs.................................     17,145       22,808
Other expenses....................................................................      4,593        7,573
                                                                                  -----------  -----------
Total expenses....................................................................     77,871      143,032
                                                                                  -----------  -----------
Loss before income taxes.......................................................... $ (112,492)  $ (177,830)
                                                                                  -----------  -----------
                                                                                  -----------  -----------
<FN>
(1) Though the Group did not lose control of LPLA until August 6, 2002, the Group was not able to obtain LPLA's
    financial  results on a U.S. GAAP basis for the period July 1, 2002 up to August 6, 2002.  Therefore,  the
    Group's  consolidated  income statement includes LPLA's  results only through June 30, 2002.  These results
    are reflected as  discontinued  operations  in the  consolidated  income statement.

(2) Fees in the amount of $2,908,000 and $9,924,000 for the years ended December 31, 2002 and 2001,  respectively,
    were paid to and included in the revenues of the venture capital and consulting business segment of continuing
    operations.  The remaining fees were paid to the asset management business segment of discontinued operations.
</FN>
</TABLE>

     The loss on disposal of discontinued  operations,  net of tax, was recorded
in the third quarter of 2002 and reported in the Group's Form 10-Q as follows:
<TABLE>
<CAPTION>
                                                                                              (In thousands)

<S>                                                                                             <C>
Net unrealized losses on available-for-sale securities, net of
   deferred policy acquisition cost amortization adjustments and deferred income taxes........  $   10,649
Impairment on long-lived assets (LPLA's net assets)...........................................      12,269
Write-off of doubtful receivables from LPLA...................................................      15,614
                                                                                               -----------
                                                                                                    38,532

Income tax benefit............................................................................           -
                                                                                               -----------
Net loss on disposal of discontinued operations...............................................  $   38,532
                                                                                               -----------
                                                                                               -----------
</TABLE>

     Previously,  LPLA had been  included  in the  Group's  life  insurance  and
annuities business segment.

                                       46
<PAGE>




                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(b) Berkeley Capital Management

     As  described  in  Note 1  "Material  Events,"  the  Group  entered  into a
definitive  agreement to sell  substantially all of the assets and operations of
BCM on March 7,  2003,  and on May 7, 2003  completed  the sale.  In  connection
therewith,  the Company deconsolidated BCM as of March 31, 2003 and BCM's assets
and liabilities  are shown as total assets of discontinued  operations and total
liabilities of discontinued  operations in the prior period consolidated balance
sheet,  in accordance  with SFAS 144. The Company does not expect to receive any
material amounts of income from its asset management  segment in the foreseeable
future.  The results of operations of BCM and, in addition for 2002, the results
of Berkeley International Limited ("BIL") (the remainder of the asset management
segment in that period) have been reported in discontinued operations.

     A summary of BCM's pre-tax operating results  (including the results of the
remainder of the asset  management  segment for the prior  periods from BIL) for
the years ended  December  31, 2003,  2002 and 2001,  and BCM's total assets and
total liabilities as of December 31, 2002, are shown below.
<TABLE>
<CAPTION>

                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)
Revenues:
<S>                                                                               <C>          <C>          <C>
Asset management fees........................................................     $     1,364  $     4,493  $     4,810
Intercompany management fee income (1).......................................               5          763        1,954
                                                                                  -----------  -----------  -----------
Total revenues...............................................................           1,369        5,256        6,764

Operating expenses...........................................................           1,403        4,643        5,316
                                                                                  -----------  -----------  -----------
Income (loss) before income taxes............................................     $       (34) $       613  $     1,448
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------

<FN>
(1) Fees were paid from and  included  in the net  revenues of the life  insurance  and  annuities  business  segment
    of  continuing operations  (LPAL) of $5,000,  $39,000 and $47,000 for the years ended  December 31,  2003,  2002
    and 2001,  respectively.  For the years ended  December  31, 2002 and 2001,  these fees also  include  $724,000
    and  $1,907,000,  respectively,  received  from LPLA (discontinued operations).
</FN>
</TABLE>
<TABLE>
<CAPTION>
                                                                                               December 31,
                                                                                                  2002
                                                                                               -----------
                                                                                              (In thousands)
Assets of discontinued operations:
<S>                                                                                            <C>
Cash.......................................................................................... $       401
Property and equipment, net...................................................................         125
Goodwill, net.................................................................................       1,267
Other assets..................................................................................         209
                                                                                               -----------
Total assets of discontinued operations....................................................... $     2,002
                                                                                               -----------
                                                                                               -----------
Liabilities of discontinued operations:
Accounts payable, accruals and other liabilities.............................................. $       413
                                                                                               -----------
Total liabilities of discontinued operations.................................................. $       413
                                                                                               -----------
                                                                                               -----------
</TABLE>

     The $7,949,000 gain on sale of discontinued  operations,  net of tax of $0,
was recorded in the second quarter of 2003 and reported in the Group's Form 10-Q
for that quarter.

                                       47
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

      Previously, BCM  was  included in  the  Group's  asset management business
segment.

(c) London Pacific Advisors

     As  described  in  Note 1  "Material  Events,"  the  Group  entered  into a
definitive agreement to sell the LPA business on May 9, 2003 and on June 5, 2003
completed the sale. In connection therewith, the Company now reports the results
of  operations  of LPA  for  the  current  and  prior  periods  as  discontinued
operations,  and LPA's assets and liabilities  (excluding LPA's net liability to
BICC which was not part of the sale) are shown as total  assets of  discontinued
operations and total liabilities of discontinued  operations in the prior period
consolidated balance sheet, in accordance with SFAS 144.

     A summary of LPA's pre-tax  operating  results for the years ended December
31,  2003,  2002 and  2001,  respectively,  and  LPA's  total  assets  and total
liabilities  (excluding  LPA's net  liability  to BICC which was not part of the
sale) as of December 31, 2002, are shown below.
<TABLE>
<CAPTION>
                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)
Revenues:
<S>                                                                               <C>          <C>          <C>
Investment income............................................................     $         4  $        18  $        37
Gross financial advisory services fees.......................................           5,820       16,184       18,627
Payments due to independent advisors.........................................          (3,477)     (10,029)     (12,039)
                                                                                  -----------  -----------  -----------
Total net revenues...........................................................           2,347        6,173        6,625

Expenses.....................................................................           4,069       10,440       10,437
                                                                                  -----------  -----------  -----------
Loss before income taxes.....................................................     $    (1,722) $    (4,267) $    (3,812)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

<TABLE>
<CAPTION>


                                                                                               December 31,
                                                                                                   2002
                                                                                               -----------
                                                                                              (In thousands)
<S>                                                                                            <C>
Assets of discontinued operations:
Cash and investments.......................................................................    $       566
Property and equipment, net................................................................          2,986
Goodwill, net..............................................................................          1,301
Other assets...............................................................................          1,535
                                                                                               -----------
Total assets of discontinued operations....................................................    $     6,388
                                                                                               -----------
                                                                                               -----------
Liabilities of discontinued operations:
Accounts payable, accruals and other liabilities............................................   $     2,141
                                                                                               -----------
Total liabilities of discontinued operations................................................   $     2,141
                                                                                               -----------
                                                                                               -----------
</TABLE>

     The $3,772,000 gain on sale of discontinued operations,  and tax expense on
the gain of $36,000, were recorded in the second quarter of 2003 and reported in
the Group's Form 10-Q for that quarter.

     Previously,  LPA was included in the Group's  financial  advisory  services
business segment.

     SunGard did not assume LPA's net liability of $10.6 million to BICC.

                                       48
<PAGE>




                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 4.    Investments

Summary Cost and Fair Value Information

Fixed Maturity Securities

     An analysis of fixed maturity securities is as follows:

<TABLE>
<CAPTION>

                                                                     December 31,
                                --------------------------------------------------------------------------------------
                                                   2003                                        2002
                                ------------------------------------------  ------------------------------------------
                                             Gross      Gross    Estimated               Gross      Gross    Estimated
                                Amortized Unrealized Unrealized     Fair    Amortized Unrealized Unrealized     Fair
                                  Cost       Gains    Losses       Value      Cost       Gains     Losses      Value
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
                                                                   (In thousands)
<S>                             <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>
Available-for-Sale:
Non-U.S. corporate
  debt securities..........     $  18,354  $      48  $     (89) $  18,313  $  12,709  $     115  $      (9) $  12,815
Corporate debt securities           7,049         33         (2)     7,080     17,772         90       (342)    17,520
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Total fixed maturity securities $  25,403  $      81  $     (91) $  25,393  $  30,481  $     205  $    (351) $  30,335
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
</TABLE>

     During 2002,  $871,000 in private  corporate debt securities  classified as
held-to-maturity  were  considered by  management  to be  other-than-temporarily
impaired and consequently their amortized cost was reduced to zero during 2002.

     As of December 31, 2003, there were no non-income  producing fixed maturity
securities for the twelve months preceding December 31, 2003.

Contractual Maturities

     The amortized cost and estimated fair value of fixed maturity securities as
of  December  31,  2003 by  contractual  maturity,  are  shown  below.  Expected
maturities may differ from  contractual  maturities as certain  issuers have the
right to call and certain borrowers have the right to prepay obligations without
penalty.
<TABLE>
<CAPTION>
                                                                                     Available-for-Sale
                                                                                  ------------------------
                                                                                                Estimated
                                                                                   Amortized       Fair
                                                                                     Cost         Value
                                                                                  -----------  -----------
                                                                                       (In thousands)

<S>                                                                               <C>          <C>
Due in one year or less ........................................................  $     4,939  $     4,957
Due after one year through five years...........................................       20,464       20,436
                                                                                  -----------  -----------
                                                                                  $    25,403  $    25,393
                                                                                  -----------  -----------
                                                                                  -----------  -----------
</TABLE>

                                       49
<PAGE>





                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Equity Securities

     Equity   securities  are  comprised  of   available-for-sale   and  trading
securities. An analysis of equity securities is as follows:
<TABLE>
<CAPTION>

                                                                     December 31,
                                --------------------------------------------------------------------------------------
                                                   2003                                        2002
                                ------------------------------------------  ------------------------------------------
                                             Gross      Gross    Estimated               Gross      Gross    Estimated
                                          Unrealized Unrealized     Fair              Unrealized Unrealized     Fair
                                  Cost       Gains    Losses       Value      Cost       Gains     Losses      Value
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
                                                                   (In thousands)
<S>                             <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>
Private corporate equity
  securities...............     $   4,262  $       -  $       -  $   4,262  $   8,980  $       -  $  (1,750) $   7,230
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Total available-for-sale
  equity securities........         4,262          -          -      4,262      8,980          -     (1,750)     7,230

Trading securities.........         4,544     12,546       (208)    16,882     26,785      5,236    (15,516)    16,505
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Total equity securities....     $   8,806  $  12,546  $    (208) $  21,144  $  35,765  $   5,236  $ (17,266) $  23,735
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
                                ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
</TABLE>

     Trading securities are carried at fair value with changes in net unrealized
gains and losses of $22,617,000,  $(22,483,000) and  $(230,981,000)  included in
the income and losses for the years  ended  December  31,  2003,  2002 and 2001,
respectively.  During 2002, the loss from the change in net unrealized gains and
losses  on  trading  securities   included  a  reclassification   adjustment  of
$8,761,000  related  to  securities  purchased  from LPLA at above  the  Group's
original cost.

Investment Concentration and Risk

     As of December 31, 2003,  equity  securities  held by the Group included an
investment in Packeteer,  Inc. of $16,336,000 which represented more than 10% of
shareholders'  equity as of that  date.  Due to the  increase  in  shareholders'
equity and the sale of fixed maturity securities during 2003, all fixed maturity
securities  accounted for less than 10% of  shareholders'  equity as of December
31, 2003.

     As of  December  31,  2003,  100% of the  Group's  $25.4  million  in fixed
maturity  securities,  99% of the  Group's  $4.3  million in  available-for-sale
private  equity  securities,  and 80% of the  Group's  $16.9  million in trading
securities were owned by the Company's  Jersey based life insurance  subsidiary,
LPAL. LPAL is a regulated insurance company,  and as such it must meet stringent
capital adequacy  requirements and it may not make any distributions without the
consent of LPAL's  independent  actuary.  LPAL'S  INVESTMENTS  ARE THEREFORE NOT
CURRENTLY  AVAILABLE TO FUND THE OPERATIONS OR COMMITMENTS OF THE COMPANY OR ITS
OTHER SUBSIDIARIES.

     As of  December  31,  2002,  fixed  maturity  securities  held by the Group
included  investments  in  General  Motors of  $7,974,000,  British  Telecom  of
$3,270,000,  Daimler  Chrysler of  $3,269,000,  Ford Motor Credit of $3,220,000,
Fiat Finance of $2,871,000,  North American Capital of $2,819,000 and Clarica of
$2,771,000.  Equity securities held by the Group primarily included  investments
in Agility Communications,  Inc. of $3,375,000,  Alacritech, Inc. of $2,250,000,
New Focus, Inc. of $2,496,000 and Packeteer,  Inc. of $11,402,000.  These eleven
corporate issuers each represented more than ten percent of shareholders' equity
as of December 31, 2002.

     Fixed  maturity   securities   considered   less  than   investment   grade
approximated  1.2% and 10.7% of total fixed  maturity  securities as of December
31, 2003 and 2002, respectively.

                                       50
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Net Unrealized Gains (Losses) on Available-for-Sale Securities

     Net  unrealized   losses  on  fixed  maturity   securities   classified  as
available-for-sale  as of  December  31,  2003  totaled  $10,000.  There were no
related  deferred  policy  acquisition  cost  adjustments or income taxes. As of
December 31, 2002, for continuing operations, the net unrealized losses on fixed
maturity securities classified as available-for-sale were $146,000.

     There were no net  unrealized  losses on equity  securities  classified  as
available-for-sale  as of December  31,  2003.  As of  December  31,  2002,  for
continuing operations, the net unrealized losses on equity securities classified
as available-for-sale totaled $1,750,000. There were no related income taxes.

     Changes in net unrealized gains and losses on available-for-sale securities
included  in other  comprehensive  income for the years ended December 31, 2001,
2002 and 2003 were as follows:
<TABLE>
<CAPTION>

                                                                                      Net Unrealized Gains (Losses)
                                                                                  -------------------------------------
                                                                                     Fixed
                                                                                   Maturity      Equity
                                                                                  Securities   Securities     Total
                                                                                  -----------  -----------  -----------
                                                                                            (In thousands)
<S>                                                                               <C>          <C>          <C>
Net unrealized losses on available-for-sale securities as of
  December 31, 2000.............................................................. $   (18,993) $    (6,209) $   (25,202)

Changes during the year ended December 31, 2001 for continuing operations:
   Unrealized holding gains and losses on available-for-sale securities..........         458       (2,081)      (1,623)
   Reclassification adjustment for gains and losses included in net income (loss)         724          112          836
   Decrease in amortization of deferred policy acquisition costs.................         405            -          405
Changes during the year ended December 31, 2001 for discontinued operations:
   Change in net unrealized gains and losses on available-for-sale securities....      27,687        7,896       35,583
   Increase in amortization of deferred policy acquisition costs.................     (13,398)           -      (13,398)
   Increase in deferred income tax liabilities...................................      (5,001)      (1,349)      (6,350)
                                                                                  -----------  -----------  -----------
Net unrealized losses on available-for-sale securities as of
   December 31, 2001.............................................................      (8,118)      (1,631)      (9,749)

Changes during the year ended December 31, 2002 for continuing operations:
   Unrealized holding gains and losses on available-for-sale securities..........        (116)      (1,000)      (1,116)
   Reclassification adjustment for gains and losses included in net income (loss)        (878)       1,244          366
   Increase in amortization of deferred policy acquisition costs.................        (551)           -         (551)
Changes during the year ended December 31, 2002 for discontinued operations:
   Change in net unrealized gains and losses on available-for-sale securities....      16,584      (10,840)       5,744
   Increase in amortization of deferred policy acquisition costs.................      (8,044)           -       (8,044)
   Decrease (increase) in deferred income tax liabilities........................      (2,989)       3,794          805
   Reclassification adjustment for losses of discontinued operations included
    in net income (loss).........................................................       3,966        6,683       10,649
                                                                                  -----------  -----------  -----------
Net unrealized losses on available-for-sale securities as of
   December 31, 2002.............................................................        (146)      (1,750)      (1,896)

Changes during the year ended December 31, 2003 for continuing operations:
   Unrealized holding gains and losses on available-for-sale securities..........          54            -           54
   Reclassification adjustment for gains and losses included in net income.......          82        1,750        1,832
                                                                                  -----------  -----------  -----------
Net unrealized losses on available-for-sale securities as of
   December 31, 2003............................................................. $       (10) $         -  $       (10)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

                                       51
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Net Investment Income

     The  details of  investment  income,  net of  investment  expenses,  are as
follows:
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Interest on fixed maturity securities........................................     $     1,611  $     5,972  $     6,040
Interest on cash and cash equivalents........................................             280          629        2,147
                                                                                  -----------  -----------  -----------
Gross investment income......................................................           1,891        6,601        8,187
Investment expenses..........................................................              (4)         (11)          (6)
                                                                                  -----------  -----------  -----------
                                                                                        1,887        6,590        8,181
Interest credited on insurance policyholder accounts.........................          (1,922)      (6,031)      (6,314)
                                                                                  -----------  -----------  -----------
Net investment income (loss).................................................     $       (35) $       559  $     1,867
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     Investment expenses included costs of investment administration,  primarily
custodial fees.

Realized Gains and Losses

     Information  about gross and net  realized  gains and losses on  securities
transactions is as follows:
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Realized gains (losses) on securities transactions:
Fixed maturities, available-for-sale:
   Gross gains...............................................................     $        43  $     1,798  $        13
   Gross losses .............................................................            (286)     (15,611)      (7,042)
                                                                                  -----------  -----------  -----------
Net realized losses on fixed maturities, available-for-sale .................            (243)     (13,813)      (7,029)
                                                                                  -----------  -----------  -----------
Fixed maturities, held-to-maturity:
   Gross losses..............................................................               -       (2,125)        (434)
                                                                                  -----------  -----------  -----------
Equity securities, trading:
   Gross gains...............................................................           4,874        5,601       36,070
   Gross losses..............................................................         (15,237)      (1,629)           -
                                                                                  -----------  -----------  -----------
Net realized gains (losses) on equity securities, trading ...................         (10,363)       3,972       36,070
                                                                                  -----------  -----------  -----------
Equity securities, available-for-sale:
   Gross gains...............................................................               9            -          456
   Gross losses..............................................................          (4,715)      (9,541)     (10,556)
                                                                                  -----------  -----------  -----------
Net realized losses on equity securities, available-for-sale ................          (4,706)      (9,541)     (10,100)
                                                                                  -----------  -----------  -----------

Net realized investment gains (losses) on securities transactions............     $   (15,312) $   (21,507) $    18,507
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

                                       52
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     During 2003, the Group's  management  determined  that three private equity
investments  in technology  companies were  other-than-temporarily  impaired and
consequently  recorded realized losses totaling $4.7 million in the consolidated
statement of income.

     During 2002,  the Group's  management  determined  that two private  equity
investments  in technology  companies were  other-than-temporarily  impaired and
consequently  recorded realized losses totaling $8.2 million in the consolidated
statement of income.  Management considered certain other private corporate debt
and  equity  investments  to be  other-than-temporarily  impaired  and  recorded
realized losses totaling $12.7 million in the consolidated  statement of income.
In  addition  during  2002,  management  considered  one public  corporate  debt
security classified as available-for-sale to be other-than-temporarily  impaired
and recorded a realized  loss of $0.3 million in the  consolidated  statement of
income for the difference  between the amortized cost and the fair value of this
security.


Note 5.    Deferred Policy Acquisition Costs

     Deferred policy acquisition cost activity was as follows:

<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Balance as of January 1......................................................     $         -  $     3,113  $     1,509
Deferral of costs relating to:
Commissions .................................................................               -          169        1,737
Other .......................................................................               -           81          405
                                                                                  -----------  -----------  -----------
                                                                                            -          250        2,142
Amortization relating to:
Operations ..................................................................               -        2,952          262
Investment gains ............................................................               -            -          670
                                                                                  -----------  -----------  -----------
                                                                                            -        2,952          932
                                                                                  -----------  -----------  -----------
Net deferral ................................................................               -       (2,702)       1,210
Adjustment for unrealized losses (gains) on available-for-sale fixed
   maturity securities.......................................................               -         (551)         405
Increase (decrease) due to foreign exchange..................................               -          140          (11)
                                                                                  -----------  -----------  -----------
Balance as of December 31 ...................................................     $         -  $         -  $     3,113
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     Due to the events described in Note 1 "Material  Events," LPAL discontinued
the issuance of new policies on July 2, 2002 and since that date  experienced  a
substantial  increase in policy  redemptions.  Based on revised estimates of the
gross profits on the remaining block of business, management determined that the
balance of deferred policy acquisition costs should be written-off in full as of
September 30, 2002.

                                       53
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 6.    Property and Equipment

     Property and equipment are carried at cost and consisted of the following:
<TABLE>
<CAPTION>

                                                                                         December 31,
                                                                                  ------------------------
                                                                                     2003         2002
                                                                                  -----------  -----------
                                                                                       (In thousands)

<S>                                                                               <C>          <C>
Property, equipment and leasehold improvements................................... $     1,549  $     1,539
Accumulated depreciation.........................................................      (1,432)      (1,350)
                                                                                  -----------  -----------
Property and equipment, net...................................................... $       117  $       189
                                                                                  -----------  -----------
                                                                                  -----------  -----------
</TABLE>


Note 7.    Goodwill

       Goodwill activity was as follows:
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Cost:
Balance as of January 1 .....................................................     $       816  $     1,205  $     1,205
Goodwill written-off.........................................................               -         (389)           -
                                                                                  -----------  -----------  -----------
Balance as of December 31 ...................................................             816          816        1,205

Accumulated amortization:
Accumulated amortization as of January 1 ....................................             816          816          768
Amortization recorded........................................................               -            -           48
                                                                                  -----------  -----------  -----------
Accumulated amortization as of December 31 ..................................             816          816          816
                                                                                  -----------  -----------  -----------
Net book value as of December 31 ............................................     $         -  $         -  $       389
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     Had SFAS 142 been in effect prior to January 1, 2002, the Group's  reported
net loss and loss per share and ADS would have been as follows:
<TABLE>
<CAPTION>

                                                                                                Year Ended
                                                                                                 December
                                                                                                 31, 2001
                                                                                               -----------
                                                                                              (In thousands,
                                                                                                except per
                                                                                              share and ADS
                                                                                                 amounts)
Net loss from continuing operations:
<S>                                                                                            <C>
As reported.................................................................................   $  (223,140)
Goodwill adjustment.........................................................................            48
                                                                                               -----------
Adjusted....................................................................................   $  (223,092)
                                                                                               -----------
                                                                                               -----------
</TABLE>

                                       54
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

<TABLE>
<CAPTION>
                                                                                                Year Ended
                                                                                                 December
                                                                                                 31, 2001
                                                                                               -----------
                                                                                              (In thousands,
                                                                                                except per
                                                                                              share and ADS
                                                                                                 amounts)
Basic and diluted loss per share (continuing operations):
<S>                                                                                            <C>
As reported.................................................................................   $     (4.38)
Effect of goodwill amortization.............................................................             -
                                                                                               -----------
Adjusted....................................................................................   $     (4.38)
                                                                                               -----------
                                                                                               -----------
Basic and diluted loss per ADS (continuing operations):
As reported.................................................................................   $    (43.77)
Effect of goodwill amortization.............................................................          0.01
                                                                                               -----------
Adjusted....................................................................................   $    (43.76)
                                                                                               -----------
                                                                                               -----------
</TABLE>

     In  accordance  with SFAS 142, the Group  evaluated  its carrying  value of
goodwill  during 2002 and determined  that the goodwill  carried on the books of
BICC was impaired. Subsequent to the loss of control of LPLA and the termination
of the investment management contract for LPLA's investment portfolio, the value
of BICC's technology venture capital business became less certain. Consequently,
BICC's  unamortized  goodwill balance of approximately  $389,000 was written-off
during 2002.


Note 8.    Cash Held in Escrow

     Cash held in escrow as of December 31, 2003  consisted of the proceeds from
the sale of LPA on June 5,  2003.  Funds  are due to be  released  with  accrued
interest in December 2004, less any amounts related to  indemnification  matters
as set out in the sale agreement.


Note 9.    Other Assets

     An analysis of other assets is as follows:

<TABLE>
<CAPTION>
                                                                                         December 31,
                                                                                  ------------------------
                                                                                     2003         2002
                                                                                  -----------  -----------
                                                                                       (In thousands)

<S>                                                                               <C>          <C>
Prepayments ...................................................................   $       499  $       757
Receivables:
   Income tax refund receivable................................................            17           61
   Fee income receivable.......................................................             7            -
   Other receivables ..........................................................             3           70
   Due from brokers............................................................             -          472
                                                                                  -----------  -----------
Total other assets  ...........................................................   $       526  $     1,360
                                                                                  -----------  -----------
                                                                                  -----------  -----------
</TABLE>

                                       55
<PAGE>




                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 10.    Life Insurance Policy Liabilities

     An analysis of life insurance policy liabilities is as follows:
<TABLE>
<CAPTION>

                                                                                        December 31,
                                                                                  ------------------------
                                                                                     2003         2002
                                                                                  -----------  -----------
                                                                                       (In thousands)

<S>                                                                               <C>          <C>
Deferred annuities - policyholder contract deposits ...........................   $    27,896  $    35,441
Other policy claims and benefits ..............................................           158            -
                                                                                  -----------  -----------
                                                                                  $    28,054  $    35,441
                                                                                  -----------  -----------
                                                                                  -----------  -----------
</TABLE>

     The liability for future policy benefits and policyholder contract deposits
was determined based on the following assumptions:

Interest Rate Assumptions

     Guaranteed  reset rates were 3.0% for seven year annuity products issued in
2002.  For  three  and five  year  annuity  products,  credited  interest  rates
generally  ranged from 3.30% to 7.40% in 2003,  3.30% to 7.40% in 2002, and from
3.45% to 7.40% in 2001.

Mortality Assumptions

     Assumed  mortality rates were based on standard tables commonly used in the
U.K. life insurance industry,  namely the AM80 table for male lives and the AF80
table for female lives.

Withdrawal Assumptions

     Withdrawal  charges on deferred  annuities  generally ranged from 1% to 7%,
grading to zero over a period of up to 7 years.


Note 11.   Statutory Financial Information and Restrictions

     LPAL is regulated by the Jersey Financial Services  Commission ("JFSC") and
under  Article 6 of the  Insurance  Business  (Jersey)  Law 1996 is permitted to
conduct long-term  insurance  business.  The JFSC requires LPAL to submit annual
audited financial statements (prepared under U.S. GAAP which is permitted),  and
an audited  annual  filing in the format  consistent  with that  required by the
Financial Services Authority in the United Kingdom.  The annual filing submitted
by LPAL to the JFSC must be  accompanied  by a  Certificate  from the  Appointed
Actuary that based on sufficiently prudent assumptions, assets are sufficient to
cover all  liabilities.  The annual filing  contains a report from the Appointed
Actuary on the matching of investments to liabilities.

     The JFSC sets out the conditions with which LPAL must comply and determines
the reporting  requirements  and the frequency of  reporting.  These  conditions
require that: (i) LPAL must hold, at all times,  approved  assets at least equal
to the long-term  insurance fund plus the required minimum solvency margin, (ii)
the margin of solvency must be the greater of (pound)50,000 or 2.5% of the value
of the long-term  business  fund, and (iii) assets equal to not less than 90% of
liabilities must be placed with approved independent custodians.  As of December
31, 2003, LPAL met all of these conditions.

                                       56
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     LPAL is also required under the insurance  laws to appoint an actuary.  The
actuary  must be  qualified  as  defined  under  Jersey law and is  required  to
supervise the long-term insurance fund. No transfers,  except in satisfaction of
long-term insurance business  liabilities,  including  dividends,  are permitted
from the long-term insurance fund without written consent from the actuary.


Note 12.    Notes Payable

     On December  20, 2002,  the Company and the Bank of Scotland  agreed to the
terms and  conditions  of an  amended  credit  facility,  providing  up to $23.0
million of  borrowings.  The facility limit was to be reduced at the end of each
calendar quarter,  such that the facility was to be repaid in full no later than
December 31, 2003.

     As of December 31, 2002, $9.3 million was  outstanding  under the facility.
In addition, $10.6 million of the remaining $10.7 million under the facility was
utilized in the form of guarantees provided on behalf of certain former investee
companies. As the Group's management believed that it would be unlikely that the
former  investee  companies  would  have  the  ability  to  repay  any of  their
borrowings during 2003, the Company recorded the maximum guarantee obligation of
$10.6  million at December 31, 2002 on its  consolidated  balance sheet and took
other-than-temporary  impairment  losses  on  the  related  investments  in  its
consolidated  income  statement for 2002.  During  February 2003, the Group sold
certain of its listed equity  securities  for $4.7 million and the proceeds were
used to reduce the Group's  borrowings to $4.4 million and the facility to $15.0
million.

     As  discussed  in Note 1  "Material  Events,"  on May 7,  2003,  the  Group
completed the sale of BCM and received  initial sale proceeds of $8.06  million.
On May 8, 2003,  the Company  paid $7.75  million to the Bank of Scotland  which
reduced the Group's  borrowings  to zero and the amounts due under its guarantee
obligations to $7.25 million.

     As  discussed  in Note 1  "Material  Events,"  on June 5,  2003,  the Group
completed the sale of LPA and received  initial sale proceeds of $6.95  million.
On that same date,  the Company paid $6.95 million to the Bank of Scotland which
reduced the amounts due under its guarantee obligations to $0.3 million. On June
20, 2003,  using its existing cash  resources,  the Company paid $0.3 million to
the Bank of Scotland and the facility was reduced to zero and terminated.


Note 13.    Income Taxes

     The Group is subject to taxation on its income in all countries in which it
operates  based  upon the  taxable  income  arising  in each  country.  However,
realized  gains on certain  investments  are  exempt  from  Jersey and  Guernsey
taxation.  This and other tax benefits  which may not recur have reduced the tax
charge in 2003, 2002 and 2001.

     The  Group is  subject  to income  tax in  Jersey at a rate of 20%.  In the
United States, the Group is subject to both federal and California taxes charged
at 34% and 8.84%, respectively.

     A breakdown of the Group's book income  (loss) from  continuing  operations
before income taxes by tax jurisdiction follows:

                                       57
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Income (loss) from continuing operations before income taxes:
Jersey, Guernsey and United Kingdom..........................................     $     2,570  $   (52,804) $  (225,098)
United States................................................................          (1,523)      (1,674)       4,065
                                                                                  -----------  -----------  -----------
Total income (loss) from continuing operations before income taxes ..........     $     1,047  $   (54,478) $  (221,033)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     The provision for income taxes differs from the amount computed by applying
the Jersey,  Channel Islands  statutory  income tax rate of 20% to income (loss)
from continuing  operations  before income taxes. The sources and tax effects of
the difference are as follows:

<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Income taxes computed at Jersey statutory income tax rate of 20%.............     $       209  $   (10,896) $   (44,207)
Realized and unrealized investment losses (gains) not subject to taxation
   in Jersey ................................................................            (474)       4,880       30,550
Other losses not deductible in Jersey........................................             896        2,664          830
Losses not deductible (income not taxable) in Guernsey.......................            (962)       2,970       15,141
Taxes on income (benefits on losses) at higher than 20% statutory
   Jersey rate:
   Net income (loss) on continuing operations in the U.S.....................            (348)        (382)         919
Non-deductible compensation in the U.S.......................................               -            -        1,012
Adjustment of prior years' provisions........................................             (33)      (1,542)          78
Increase (decrease) in valuation allowance ..................................          47,962       23,958       (2,660)
Less: valuation allowance related to discontinued operations.................         (52,238)     (20,768)         223
Utilization of U.S. capital loss carryforwards for which a full valuation
   allowance had been provided in prior years................................           4,100            -            -
Other........................................................................             846          407          221

                                                                                  -----------  -----------  -----------
Actual tax expense (benefit) for continuing operations ......................     $       (42) $     1,291  $     2,107
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     The  components of the actual tax expense for  continuing operations are as
follows:

 <TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Jersey, Guernsey and United Kingdom:
   Current tax expense (benefit).............................................     $       (33) $      (671) $     1,601
   Deferred tax expense......................................................               -            -            -

United States:
   Current tax expense (benefit).............................................              (9)        (903)         511
   Deferred tax expense (benefit)............................................               -        2,865           (5)

                                                                                  -----------  -----------  -----------
Total actual tax (benefit) expense...........................................     $       (42) $     1,291  $     2,107
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

                                       58
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     The  components  of the  actual  tax  expense  (benefit)  for  discontinued
operations are as follows:
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
United States:
   Current tax expense (benefit).............................................     $        38  $    (8,159) $     8,252
   Deferred tax expense (benefit)............................................               -        3,216      (66,802)
                                                                                  -----------  -----------  -----------
                                                                                  $        38  $    (4,943) $   (58,550)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     The  Group   recognizes   assets  and  liabilities  for  the  deferred  tax
consequences  of  temporary  differences  between  the tax basis of  assets  and
liabilities  and their  reported  amounts  in the  financial  statements.  These
temporary  differences  will result in taxable or  deductible  amounts in future
years when the  reported  amounts of assets and  liabilities  are  recovered  or
settled.   The  deferred  income  tax  assets  are  reviewed   periodically  for
recoverability  and valuation  allowances  are provided as  necessary.  Deferred
income  tax  assets  and  liabilities  are  disclosed  net in  the  consolidated
financial  statements when they arise within the same tax  jurisdiction  and tax
return.

     The tax  effects of  temporary  differences  that give rise to  significant
portions of the deferred  income tax assets and deferred  income tax liabilities
are presented  below.  As of both December 31, 2002 and December 31, 2003,  full
valuation  allowances  were provided on the net deferred tax assets of both U.S.
tax groups due to the uncertainty of generating future taxable income or capital
gains to benefit from the deferred tax assets.
<TABLE>
<CAPTION>

                                                                                        December 31,
                                                                                  ------------------------
                                                                                     2003         2002
                                                                                  -----------  -----------
                                                                                       (In  thousands)
U.S. subsidiaries (continuing operations):

<S>                                                                               <C>          <C>
Deferred income tax assets:
Net operating loss carryforwards...............................................   $     8,082  $     8,539
Capital loss carryforwards.....................................................        67,288       18,774
Unrealized losses on investments...............................................             -          376
Deferred compensation..........................................................             9          137
Other assets...................................................................            53           27
Valuation allowance............................................................       (75,382)     (27,420)
                                                                                  -----------  ----------
Deferred income tax assets, net of valuation allowance.........................            50          433

Deferred income tax liabilities:
Depreciation, amortization and other...........................................             -         (431)
Other liabilities .............................................................           (50)          (2)
                                                                                  -----------  -----------
                                                                                          (50)        (433)
                                                                                  -----------  -----------
Net deferred income tax assets - U.S. subsidiaries
   (continuing operations).....................................................   $         -  $         -
                                                                                  -----------  -----------
                                                                                  -----------  -----------
</TABLE>

     The net increase in the deferred tax  valuation  allowance  during 2003 was
$47,962,000. The primary component of this net increase ($52,238,000) relates to
the loss of control of LPLA during 2002. As of

                                       59
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31,  2002,  the deferred  tax asset and  corresponding  100%  valuation
allowance  relating to the loss on the Group's investment in LPLA as reported in
the Group's  consolidated balance sheet, was based on a loss for tax purposes of
$37.5  million.  Upon  subsequent  review by the Group and its tax  advisors,  a
capital  loss of $159.4  million was  reported  in the Group's  2002 tax returns
filed during 2003.  As the Group has fully  provided for all deferred tax assets
as of both  December 31, 2002 and December 31, 2003,  the  adjustment to the tax
loss on LPLA  resulted  in no income  tax  expense  or  benefit  in the  Group's
consolidated statement of income for 2003.

     As of December 31, 2003, the U.S. subsidiaries of continuing operations had
pre-tax federal net operating loss carryforwards of approximately  $21.2 million
expiring  as  follows:  approximately  $1.6  million  from  2004  to  2012,  and
approximately   $19.6  million  from  2020  to  2023.  These  subsidiaries  have
California  net operating  loss  carryforwards  of  approximately  $10.0 million
expiring  as  follows:   approximately   $2.1  million  in  2004  to  2006,  and
approximately  $7.9 million from 2012 to 2013. In addition,  these  subsidiaries
have federal  capital loss  carryforwards  of $157.8 million ($154.2 million for
California  purposes)  that  expire  in 2007.  The  Group  has  recorded  a full
valuation  allowance for the deferred tax assets arising from these carryforward
amounts as of December 31, 2003.

     In October 2003,  the California  Franchise Tax Board ("FTB")  notified the
Group of proposed  income tax  assessments  totaling  $2.3 million plus interest
related to the Group's 1998 and 1999 tax returns.  In December  2003,  the Group
filed a protest  letter with the FTB. The FTB has  acknowledged  receipt of this
protest  letter and will be  assigning  a hearing  officer to this  matter.  The
Group's management believes, after consultation with its tax and legal advisors,
that the actual  income  tax  liability  owed will not have a  material  adverse
impact on the Group's financial position, results of operations or cash flows.


Note 14.    Shareholders' Equity

     The Company has authorized  86,400,000  Ordinary Shares with a par value of
$0.05 per  share.  As of  December  31,  2003 and 2002,  there  were  64,439,073
Ordinary Shares issued and outstanding.

     No dividends  were declared and paid in 2003. A final dividend for 2001 was
declared  and paid during 2002 of $0.05 gross per  Ordinary  Share ($0.04 net of
20% Jersey tax) and $0.40 per ADS (net of 20% Jersey  tax),  or  $2,032,000,  in
total.  Total  dividends  declared  and paid  during  2001 were $0.29  gross per
Ordinary  Share  ($0.232  net of 20%  Jersey  tax) and $2.32 per ADS (net of 20%
Jersey tax), or $11,802,000, in total.

     Accumulated other  comprehensive  income (loss) consists of two components,
foreign currency translation  adjustments and net unrealized gains and losses on
available-for-sale   securities.   Accumulated   foreign  currency   translation
adjustments were $(429,000),  $(717,000) and $(157,000) as of December 31, 2003,
2002 and 2001,  respectively.  The net unrealized  losses on  available-for-sale
securities after deferred policy  acquisition cost amortization  adjustments and
income taxes were $(10,000),  $(1,896,000)  and  $(9,749,000) as of December 31,
2003, 2002 and 2001,  respectively.  Of these amounts,  $0, $0 and  $(9,154,000)
related to  discontinued  operations  as of December  31,  2003,  2002 and 2001,
respectively.

     The Group  has two share  incentive  plans as  described  in Note 17 "Share
Incentive  Plans." Under the terms of these plans,  shares of the Company may be
purchased  in the open market and held in trust.  These  shares are owned by the
employee  benefit  trusts,  which are  subsidiaries of the Company for financial
reporting purposes.

                                       60
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     Changes  in the  number of shares  held by The  London  Pacific  Group 1990
Employee  Share Option Trust  ("ESOT") and the Agent Loyalty  Opportunity  Trust
("ALOT") were as follows:
<TABLE>
<CAPTION>
                                                                 Years Ended December 31,
                                           ----------------------------------------------------------------
                                                   2003                  2002                  2001
                                           --------------------  --------------------  --------------------
                                             ESOT       ALOT       ESOT       ALOT       ESOT       ALOT
                                           ---------  ---------  ---------  ---------  ---------  ---------
                                                                       (In thousands)

<S>                                           <C>           <C>     <C>           <C>     <C>           <C>
Shares held as of January 1 ..........        13,247        438     13,260        438     12,374        438
Purchased ............................             -          -          -          -      1,027          -
Exercised ............................             -          -        (13)         -       (141)         -
                                           ---------  ---------  ---------  ---------  ---------  ---------
Shares held as of December 31.........        13,247(1)     438     13,247(1)     438     13,260(1)     438
                                           ---------  ---------  ---------  ---------  ---------  ---------
                                           ---------  ---------  ---------  ---------  ---------  ---------
<FN>
(1) 834,000 shares were held in ADR form.
</FN>
</TABLE>

Warrants

     On November 11, 2002,  the Company  agreed to grant  1,933,172  warrants to
subscribe  for the Company's  Ordinary  Shares to Bank of Scotland in connection
with the extension of the Group's  credit  facility  (which was fully repaid and
terminated  in June 2003).  The  warrants  were granted on February 14, 2003 and
have an  exercise  price of  (pound)0.1143  (based on the average of the closing
prices of the  Ordinary  Shares  over the  trading  days from  November  1, 2002
through  November  11,  2002),  which  was  higher  than  the  market  price  of
(pound)0.09  on November 11, 2002.  These  warrants are  exercisable at any time
prior to February 14, 2010 and their fair value was  determined  to be $251,125,
based on a risk-free  rate of 2.80%,  volatility of 179% and a dividend yield of
zero. The Company  recognized  $30,625 of expense  relating to these warrants in
2002.  The balance of $220,500 was  recognized  as an expense in 2003,  with the
corresponding entries to additional paid-in capital.


Note 15.    Commitments and Contingencies

Lease Commitments

     The Group  leases  furniture,  fixtures  and  equipment  under  capital and
operating  leases with terms in excess of one year. The Group also leases office
space under  operating  leases.  Total rent expense on  operating  leases in the
continuing  operations  was $407,000,  $400,000 and $387,000 for the years ended
December 31, 2003, 2002 and 2001, respectively.

                                       61
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     Future  minimum lease payments  required under capital and  non-cancellable
operating  leases with terms of one year or more, as of December 31, 2003,  were
as follows:
<TABLE>
<CAPTION>

                                                                                    Capital     Operating
                                                                                     Leases     Leases (1)
                                                                                  -----------  -----------
                                                                                       (In thousands)

<C>                                                                               <C>          <C>
2004 ..........................................................................   $         8  $       263
2005 ..........................................................................             7          114
2006...........................................................................             -          115
2007...........................................................................             -          114
2008...........................................................................             -          114
2009 and thereafter ...........................................................             -          172
                                                                                  -----------  -----------
Total .........................................................................            15  $       892
                                                                                               -----------
                                                                                               -----------
Less amounts representing interest ............................................             -
                                                                                  -----------
Present value of net minimum lease payments ...................................   $        15
                                                                                  -----------
                                                                                  -----------
<FN>
(1) Includes  lease  commitments  on our San  Francisco  office lease which expire in April 2004.  Management
    is currently  evaluating alternative  office space in San  Francisco  for which no  commitment  has been
    entered into as of the date of filing of this Form 10-K.
</FN>
</TABLE>

     Commitments  eliminated  as of August 6, 2002 as a result of the actions of
the North  Carolina  Department of Insurance  ("NCDOI") with respect to LPLA (as
described  in  Note  1  "Material  Events")  for  operating  and  capital  lease
commitments were approximately $10.8 million and $0, respectively.

     Commitments  eliminated  following the disposals of BCM and LPA during 2003
(as  described in Note 3  "Discontinued  Operations")  for operating and capital
lease   commitments   were   approximately   $1.9  million  and  $0.1   million,
respectively.

Guarantees

     In November  2002, the FASB issued FASB  Interpretation  No. 45 ("FIN 45"),
"Guarantor's  Accounting and Disclosure  Requirements for Guarantees,  Including
Indirect  Guarantees  of  Indebtedness  of  Others - an  interpretation  of FASB
Statements No. 5, 57 and 107 and rescission of FASB  Interpretation No. 34." The
following  is a  summary  of the  Company's  agreements  that  the  Company  has
determined are within the scope of FIN 45.

     Under its Memorandum and Articles of Association, the Company has agreed to
indemnify its officers and directors for certain events or  occurrences  arising
as a result of the officer or  director  serving in such  capacity.  The maximum
potential  amount of future payments the Company could be required to make under
these  indemnification  agreements is unlimited.  However, the Company maintains
directors and officers  liability  insurance that limits the Company's  exposure
and enables it to recover a portion of any future  amounts  paid. As a result of
its insurance  coverage,  the Company believes the estimated fair value of these
indemnification  agreements is minimal and has no liabilities recorded for these
agreements as of December 31, 2003.

     The Company  enters into  indemnification  provisions  under its agreements
with other companies in its ordinary course of business, typically with business
partners,  clients and landlords.  Under these provisions, the Company generally
indemnifies  and holds  harmless the  indemnified  party for losses  suffered or
incurred by the indemnified party as a result of the Company's activities. These
indemnification provisions sometimes

                                       62
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

include  indemnifications  relating to representations  made by the Company with
regard  to  intellectual  property  rights.  These  indemnification   provisions
generally survive termination of the underlying agreement. The maximum potential
amount of future  payments  the  Company  could be  required to make under these
indemnification provisions is unlimited. The Company believes the estimated fair
value  of  these  agreements  is  minimal.   Accordingly,  the  Company  has  no
liabilities recorded for these agreements as of December 31, 2003.

Contingencies

     In the course of the  administration of LPLA in  rehabilitation,  the NCDOI
requested information  concerning the history of a limited number of investments
in securities of portfolio  companies  during  November  2002.  These  portfolio
investments  have  been  associated  with LPLA for more than  seven  years,  and
involve intercompany transfers.  The history of their investment performance and
ownership is complex. The Company has complied with these requests.  The Company
is not able at this time to predict what  conclusions the NCDOI will reach after
evaluation of this information.

     The Group was involved in various legal  proceedings,  including claims for
damages from LPA clients of a nature considered to be normal for LPA's business.
All  proceedings  against LPA were  resolved  prior to the end of January  2004,
resulting in no claims paid or to be paid by the Group.

     In  October  2003,  the FTB  notified  the  Group of  proposed  income  tax
assessments  totaling $2.3 million plus interest related to the Group's 1998 and
1999 tax returns.  In December  2003,  the Group filed a protest letter with the
FTB.  The FTB has  acknowledged  receipt  of this  protest  letter  and  will be
assigning a hearing  officer to this matter.  The Group's  management  believes,
after  consultation with its tax and legal advisors,  that the actual income tax
liability owed will not have a material adverse impact on the Group's  financial
position, results of operations or cash flows.


Note 16.   Fair Value of Financial Instruments

     Substantially  all financial  instruments  used in the Group's  trading and
investing  activities are carried at fair value or amounts that approximate fair
value.  Fair value is based  generally on listed market prices or  broker-dealer
price quotations. To the extent that prices are not readily available, estimated
fair value is based on valuation  methodologies  performed by management,  which
evaluate company, industry,  geographical and overall equity market factors that
would influence the security's fair value.

     With  the  exception  of  the  fixed  maturity  securities   classified  as
held-to-maturity,  which are held at amortized  cost, the carrying values of the
Group's financial assets are equal to estimated fair value.

     Considerable  judgment  is  required  in  interpreting  market data used to
develop the estimates of fair value. Accordingly, the estimates presented herein
are not  necessarily  indicative  of the  amounts  that could be  realized  in a
current market exchange.  The use of different market  assumptions or estimation
methodologies may have a material effect on the estimated fair value amounts.

                                       63
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     The  carrying  values and  estimated  fair values of the Group's  financial
instruments were as follows:
<TABLE>
<CAPTION>


                                                                      December 31,
                                                      ------------------------------------------
                                                              2003                  2002
                                                      --------------------  --------------------
                                                      Carrying   Estimated  Carrying   Estimated
                                                        Value   Fair Value    Value   Fair Value
                                                      ---------  ---------  ---------  ---------
                                                                    (In thousands)
Financial assets:
<S>                                                   <C>        <C>        <C>        <C>
Cash and cash equivalents .......................     $  14,408  $  14,408  $  15,308  $  15,308
Cash held in escrow..............................           999        999          -          -
Investments:
   Fixed maturities:
       Available-for-sale........................        25,393     25,393     30,335     30,335
   Equity securities:
       Trading...................................        16,882     16,882     16,505     16,505
       Available-for-sale........................         4,262      4,262      7,230      7,230

Financial liabilities:
Life insurance policy liabilities ...............        28,054     27,758     35,441     35,430
Notes payable....................................             -          -      9,314      9,314

</TABLE>

     The following  methods and assumptions were used by the Group in estimating
the fair value of the financial instruments presented:

Cash, Cash Equivalents and Cash Held in Escrow: The carrying amounts reported in
the consolidated balance sheet for these instruments approximated fair value.

Fixed  Maturity  Securities:  Fair values for  actively  traded  fixed  maturity
securities  classified as  available-for-sale  were generally  based upon quoted
market prices.  Fair values for private  corporate debt securities were based on
the results of valuation methodologies performed by management.

Equity Securities:

a)   Trading Securities: Fair values for equity securities classified as trading
were based on quoted market prices.

b)   Available-for-Sale     Securities:   Fair  values  for   equity  securities
classified  as  available-for-sale  were based upon the results of  management's
valuation methodologies,  including analysis of company, industry,  geographical
and overall equity market factors which influence fair value.

Life Insurance  Policy  Liabilities:  The balance sheet caption "life  insurance
policy liabilities" includes investment-type insurance contracts (i.e., deferred
annuities). The estimated fair values of deferred annuity policies were based on
their account values after deduction of surrender charges.

Notes Payable:  The carrying amounts reported in the consolidated  balance sheet
for  these  instruments  approximated  fair  value as the bank  borrowings  bear
interest at a variable rate.


Note 17.    Share Incentive Plans

     The Group has two share incentive plans for employees, agents and directors
of  Berkeley  Technology  Limited  and its  subsidiaries  that  provide  for the
issuance of share options and stock appreciation rights.

                                       64
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Employee Share Option Trust

     The London Pacific Group 1990 Employee Share Option Trust  ("ESOT"),  which
was approved by shareholders in 1990, provides for the granting of share options
to employees and directors.  The  objectives of this plan include  retaining the
best personnel and providing for additional performance incentives.  Options are
generally  granted with an exercise  price equal to the fair market value at the
date of grant. Such grants to employees are generally  exercisable in four equal
annual  installments  beginning  one year  from the date of  grant,  subject  to
employment  continuation,  and expire seven or ten years from the date of grant.
Such grants to directors  are fully vested on the date of grant and expire seven
or ten years from the date of the grant.

     The ESOT may purchase shares of the Company in the open market, funded each
year by a loan from the Company or its  subsidiaries.  While the loan is limited
up to an annual maximum of 5% of the  consolidated  net assets of the Group, the
ESOT is not limited as to the number of options that may be granted. The loan is
secured by the shares held in the trust,  is interest free, and is eliminated in
the consolidated  financial  statements.  The ESOT has waived its entitlement to
dividends on any shares held. See Note 14  "Shareholders'  Equity" for a summary
of the share activity within the ESOT.

     Share option  activity for the years ended December 31, 2003, 2002 and 2001
was as follows:
<TABLE>
<CAPTION>
                                                              2003                  2002                  2001
                                                      --------------------  --------------------  --------------------
                                                                 Weighted-             Weighted-             Weighted-
                                                       Number     Average     Number    Average    Number     Average
                                                         of      Exercise       of     Exercise      of      Exercise
(Options in thousands)                                 Options     Price     Options     Price     Options     Price
                                                      ---------  ---------  ---------  ---------  ---------  ---------

<S>                                                      <C>     <C>           <C>     <C>           <C>     <C>
Outstanding as of January 1......................        13,575  $    3.10     13,263  $    4.59     12,213  $    4.32
Granted..........................................             -          -      5,165       0.32      2,388       5.19(1)
Exercised........................................             -          -        (13)      3.26       (141)      3.13
Forfeited........................................        (2,517)      3.12     (4,496)      4.35        (89)     12.44
Expired..........................................        (2,113)      3.09       (344)      2.42     (1,108)      2.48
                                                      ---------  ---------  ---------  ---------  ---------  ---------
Outstanding as of December 31....................         8,945  $    3.10     13,575  $    3.10     13,263  $    4.59
                                                      ---------  ---------  ---------  ---------  ---------  ---------
                                                      ---------  ---------  ---------  ---------  ---------  ---------

Options exercisable as of December 31............         7,046  $    3.82      9,297  $    4.13     11,757  $    4.44
                                                      ---------  ---------  ---------  ---------  ---------  ---------
                                                      ---------  ---------  ---------  ---------  ---------  ---------
<FN>
(1) Of the options granted during 2001,  those granted at market price had a weighted-average exercise price of $5.44
    and those granted at less than market price had a weighted-average  exercise price of $2.46.  All options granted
    during 2002 were granted at market price.
</FN>
</TABLE>

     The Group accounts for stock based  compensation  using the intrinsic value
method  prescribed  by  Accounting  Principles  Board Opinion No. 25 ("APB 25"),
"Accounting for Stock Issued to Employees." In accordance with APB 25, the Group
recorded  compensation  expense  relating to stock  options of $530,000 in 2001.
This expense  represented  the difference  between the exercise price of options
and the  market  value of the  underlying  shares  at the date of grant  and was
recognized in full as all options were fully vested.

     See  Note  2  "Summary   of   Significant   Accounting   Policies"   for  a
reconciliation of net income (loss) as reported and as adjusted under SFAS 123.

                                       65
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     Summary  information  about the Group's  share  options  outstanding  as of
December 31, 2003 is as follows:
<TABLE>
<CAPTION>
                                    Options Outstanding                                     Options Exercisable
                      -------------------------------------------------              ------------------------------
                                           Weighted-
                                            Average          Weighted-                                   Weighted-
 Range of                                  Remaining          Average                                     Average
 Exercise                  Number         Contractual        Exercise                   Number           Exercise
  Prices                 Outstanding         Life              Price                   Exercisable        Price
------------          ---------------     -----------       -----------              -------------      -----------
                        (In thousands)        (Years)                                 (In thousands)

<S>                            <C>              <C>           <C>                           <C>           <C>
$  0.10 - $0.50                 2,770            8.58         $    0.32                        918        $    0.35
   0.51 -  5.00                 3,930            1.79              3.41                      3,930             3.41
   5.01 - 10.00                 2,165            7.24              5.42                      2,118             5.41
  10.01 - 21.00                    80            6.68             21.00                         80            21.00
---------------       ---------------      ----------        ----------              -------------       ----------
$ 0.10 - $21.00                 8,945            5.26         $    3.10                      7,046        $    3.82
---------------       ---------------      ----------        ----------              -------------       ----------
---------------       ---------------      ----------        ----------              -------------       ----------
</TABLE>

Agent Loyalty Opportunity Trust

     The Agent Loyalty  Opportunity  Trust ("ALOT") provides for the granting of
stock appreciation rights ("SARs") on the Company's Ordinary Shares to agents of
LPLA. The ALOT was  established  in 1997 without  shareholders'  approval.  Each
award unit  entitles  the holder to cash  compensation  equal to the  difference
between the Company's  prevailing  share price and the exercise price. The award
units are exercisable in four equal annual installments  commencing on the first
anniversary  of the date of grant  and are  forfeited  upon  termination  of the
agency  contract.  Vesting of the award in any given year is also  contingent on
the holder of the award  surpassing a predetermined  benchmark tied to sales and
persistency. The SARs expire seven years from the date of grant. Given that LPLA
is under the  administrative  supervision  of the NCDOI and is no longer selling
policies, the status of these awards is unclear.

     The ALOT may purchase Ordinary Shares in the open market,  funded by a loan
from a Group subsidiary. The loan is secured by the shares held in the trust and
bears  interest  based upon the  trust's  net income  before  interest  for each
financial period.  The trust receives dividends on all Ordinary Shares held. The
loan,  interest  income and dividend  income are eliminated in the  consolidated
financial  statements.  See Note 14 "Shareholders'  Equity" for a summary of the
share activity within the ALOT.

     SAR  activity for the years ended  December 31, 2003,  2002 and 2001 was as
follows:
<TABLE>
<CAPTION>

                                                              2003                  2002                  2001
                                                      --------------------  --------------------  --------------------
                                                                 Weighted-             Weighted-             Weighted-
                                                        Number    Average     Number    Average     Number    Average
                                                       of Award  Exercise    of Award  Exercise    of Award  Exercise
(Award units in thousands)                              Units      Price      Units      Price      Units      Price
                                                      ---------  ---------  ---------  ---------  ---------  ---------

<S>                                                        <C>   <C>             <C>   <C>             <C>   <C>
Outstanding as of January 1......................           388  $    3.73        404  $    3.73        438  $    3.71
Granted..........................................             -          -          -          -          -          -
Exercised........................................             -          -          -          -        (10)      3.46
Forfeited........................................             -          -        (16)      3.88        (24)      3.41
                                                      ---------  ---------  ---------  ---------  ---------  ---------
Outstanding as of December 31....................           388  $    3.73        388  $    3.73        404  $    3.73
                                                      ---------  ---------  ---------  ---------  ---------  ---------
                                                      ---------  ---------  ---------  ---------  ---------  ---------

Award units exercisable as of December 31........           284  $    3.62        284  $    3.62        173  $    3.64
                                                      ---------  ---------  ---------  ---------  ---------  ---------
                                                      ---------  ---------  ---------  ---------  ---------  ---------
</TABLE>

                                       66
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     Summary  information  about the Group's SARs outstanding as of December 31,
2003 is as follows:
<TABLE>
<CAPTION>

                                      Award Units Outstanding                             Award Units Exercisable
                        -----------------------------------------------              ------------------------------
                                            Weighted-
                                             Average         Weighted-                                   Weighted-
  Range of                                 Remaining          Average                                     Average
  Exercise                 Number          Contractual       Exercise                    Number          Exercise
   Prices                Outstanding          Life             Price                   Exercisable         Price
---------------         -------------      ----------      ------------               ------------     ------------
                        (In thousands)      (Years)                                 (In thousands)

<C>                               <C>            <C>          <C>                              <C>        <C>
$          3.35                   309            0.99         $    3.35                        243        $    3.35
           5.19                    79            2.28              5.19                         41             5.19
---------------          ------------      ----------       -----------                -----------     ------------
$  3.35 - $5.19                   388            1.25         $    3.73                        284        $    3.62
---------------          ------------      ----------       -----------                -----------     ------------
---------------          ------------      ----------       -----------                -----------     ------------
</TABLE>

     In  March  2000,   the   Financial   Accounting   Standards   Board  issued
Interpretation No. 44 ("FIN 44"), "Accounting for Certain Transactions Involving
Stock  Compensation,  an  Interpretation  of APB  Opinion  No.  25,"  which  was
effective for all awards granted after July 1, 2000.

     Compensation expense relating to award grants in the ALOT was accounted for
under APB 25, prior to the issuance of FIN 44. Thus,  no expense was  recognized
at the grant dates because all awards were made with an exercise  price equal to
the prevailing market value. However, upon exercise of the awards,  compensation
expense of $0, $0 and $20,000 for the years ended  December 31,  2003,  2002 and
2001, respectively, was recognized in the consolidated income statements as part
of  the  loss  from  discontinued  operations.  This  compensation  expense  was
capitalized in the  consolidated  balance sheets as deferred policy  acquisition
costs,  in  accordance  with the Group's  accounting  policy as stated in Note 2
"Summary of Significant Accounting Policies."


Note 18.     Pension Plans

Jersey Plan

     The Group provided a defined benefit  pension plan for its Jersey,  Channel
Islands,  employees.  This plan is in the  process  of being  terminated.  It is
anticipated  that this will be completed  during the first quarter of 2004.  The
plan assets are being  distributed to the participants of the plan on a pro rata
basis to their accrued benefit  entitlements  under the plan. The Group will not
have any ongoing liabilities in respect of the plan following its dissolution.

     The plan provided benefits on retirement at age sixty based on one sixtieth
of an employee's  final average salary over the  employee's  last three years of
employment  for each full  year of  service,  and life  insurance  coverage  for
current  employees.  There are eight  individuals (six current employees and two
ex-employees) who were entitled to future benefits under the plan as at December
31, 2003. The plan was funded by contributions from the Group. The assets of the
plan are held in a trust for the benefit of the employees and were managed by an
external asset manager. The assets are currently in cash pending distribution to
employees.

     An actuarial  report and valuation by an  independent  actuary was required
every three years. The most recent report and actuarial  valuation  received was
as of December 31, 2000. At that time,  the trust had assets of  $1,153,000  and
the actuarial  valuation of past service  ongoing  liabilities  was  $1,746,000,
indicating a past

                                       67
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

service  deficit of $593,000 in the plan.  There were,  as at that date,  twelve
individuals (nine employees and three  ex-employees) who were entitled to future
benefits under the plan. The actuary  recommended  that the past service deficit
be  made  up and  that  contributions  be  increased  from  20.0%  to  21.5%  of
participants'  salaries to cover future liabilities.  Additional  contributions,
sufficient to cover the deficit indicated in that actuarial valuation, were made
to the trust during 2002 and  contributions  on salaries were increased to 21.5%
effective from the beginning of 2001.

     The Group made  contributions  of  $148,000,  $731,000  and $361,000 to the
trust in 2003,  2002 and  2001,  respectively.  Assets  held by the  trust  were
$2,272,000,  $1,721,000 and  $1,247,000 as of December 31, 2003,  2002 and 2001,
respectively.

U.K. Plan

     The Group  provides  a defined  contribution  plan for its U.K.  employees.
There is  currently  one  participant  in the plan.  The  Group  has no  ongoing
liabilities  associated with the plan.  Contributions  of $41,000,  $143,000 and
$52,000 were made by the Group to the plan in 2003, 2002 and 2001, respectively.
Of the 2002 contribution, $94,000 was offset by a salary waiver.


Note 19.    Earnings Per Share and ADS

     Earnings  (loss) per ADS are  equivalent to ten times  earnings  (loss) per
Ordinary Share,  following the  one-for-ten  reverse split in June 2002. All ADS
amounts shown below have been restated to reflect this split.

     A  reconciliation  of the  numerators  and  denominators  for the basic and
diluted  earnings (loss) per share  calculations in accordance with Statement of
Financial Accounting Standard No. 128 ("SFAS 128"),  "Earnings per Share," is as
follows:
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                 (In thousands, except share, per share
                                                                                            and ADS amounts)

<S>                                                                               <C>          <C>          <C>
Income (loss) from continuing operations...............................           $     1,089  $   (55,769) $  (223,140)
Income (loss) on discontinued operations...............................                 9,927     (149,735)    (121,644)
                                                                                  -----------  -----------  -----------
Net income (loss)......................................................           $    11,016  $  (205,504) $  (344,784)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
Basic earnings (loss) per share and ADS:
Weighted-average number of Ordinary Shares outstanding,
  excluding shares held by the employee benefit trusts.................            50,754,192   50,753,084   50,984,146
                                                                                  -----------  -----------  -----------

Basic earnings (loss) per share:
Continuing operations .................................................           $      0.02  $     (1.10) $     (4.38)
Discontinued operations................................................                  0.20        (2.95)       (2.38)
                                                                                  -----------  -----------  -----------
                                                                                  $      0.22  $     (4.05) $     (6.76)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
Basic earnings (loss) per ADS:
Continuing operations..................................................           $      0.21  $    (10.99) $    (43.77)
Discontinued operations................................................                  1.96       (29.50)      (23.85)
                                                                                  -----------  -----------  -----------
                                                                                  $      2.17  $    (40.49) $    (67.62)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

                                       68
<PAGE>

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
<TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                 (In thousands, except share, per share
                                                                                           and ADS amounts)
<S>                                                                               <C>          <C>          <C>
Diluted earnings (loss) per share and ADS:
Weighted-average number of Ordinary Shares outstanding,
  excluding shares held by the employee benefit trusts................             50,754,192   50,753,084   50,984,146
Effect of dilutive securities (warrants and employee share options) ..                433,706            -            -
                                                                                  -----------  -----------  -----------
Weighted-average number of Ordinary Shares used in diluted
  earnings per share calculations.....................................             51,187,898   50,753,084   50,984,146
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
Diluted earnings (loss) per share:
Continuing operations .................................................           $      0.02  $     (1.10) $     (4.38)
Discontinued operations................................................                  0.20        (2.95)       (2.38)
                                                                                  -----------  -----------  -----------
                                                                                  $      0.22  $     (4.05) $     (6.76)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
Diluted earnings (loss) per ADS:
Continuing operations..................................................           $      0.21  $    (10.99) $    (43.77)
Discontinued operations................................................                  1.94       (29.50)      (23.85)
                                                                                  -----------  -----------  -----------
                                                                                  $      2.15  $    (40.49) $    (67.62)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

     As the Company  recorded a net loss for the years ended  December  31, 2002
and 2001, the  calculations of diluted earnings per share for these years do not
include  potentially  dilutive employee share options and warrants issued to the
Bank of Scotland as they are anti-dilutive and, if included, would have resulted
in a reduction of the net loss per share. If the Company had reported net income
for the years  ended  December  31,  2002 and  2001,  there  would  have been an
additional  347,258  and  3,022,963  shares,   respectively,   included  in  the
calculations of diluted earnings per share for these years.


Note 20.    Transactions with Related Parties

     The Group paid legal fees of  approximately  $76,000,  $130,000 and $60,000
during  2003,  2002 and  2001,  respectively,  to a law firm of which one of its
directors, Victor A. Hebert, is a member.


Note 21.    Business Segment and Geographical Information

     The Company's reportable operating segments are classified according to its
remaining  businesses of life insurance and annuities,  and venture  capital and
consulting.

     Due to the sales of BCM and LPA in 2003 (see Note 1 "Material Events"), the
Company's asset management and financial  advisory segments have been classified
as  discontinued  operations  as of  December  31,  2002 and for the years ended
December 2003,  2002 and 2001. Due to the loss of control of LPLA (see also Note
1  "Material  Events"),  the results of  operations  of LPLA for the years ended
December 2002 and 2001 have been included in discontinued operations.

                                       69
<PAGE>




                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

     Intercompany  transfers between reportable operating segments are accounted
for at prices  which are designed to be  representative  of  unaffiliated  third
party transactions. During the years ended December 31, 2003, 2002 and 2001, the
venture capital and consulting segment generated portfolio  management fees from
LPLA (discontinued  operations) of $0, $2,908,000 and $9,924,000,  respectively.
These  portfolio  management  fees are  included in the  revenues of  continuing
operations  and  have  not  been  eliminated  in  the   consolidated   financial
statements. These management fees were approved by the insurance regulatory body
in LPLA's U.S. state of domicile.

     The venture capital and consulting segment recorded net realized investment
losses  in the  amount of  $1,603,000  during  2002  related  to  intersegmental
investment sales to the life insurance and annuities segment. These net realized
investment losses were offset by a corresponding  reclassification adjustment in
unrealized  investment  gains and  losses  on  trading  securities  for the same
amount.   These  gains  and  losses  have  been   eliminated  in  the  Company's
consolidated financial statements.

     Summary  revenue and  investment  gain  (loss)  information  by  geographic
segment,  based on the domicile of the Group company  generating those revenues,
is as follows:

 <TABLE>
<CAPTION>

                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)

<S>                                                                               <C>          <C>          <C>
Jersey.................................................................           $     4,220  $   (22,517) $  (146,416)
Guernsey...............................................................                 4,926      (13,636)     (59,220)
United States..........................................................                    52        2,816       11,260
                                                                                  -----------  -----------  -----------
Consolidated revenues and net investment gains (losses)
    for continuing operations..........................................           $     9,198  $   (33,337) $  (194,376)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
</TABLE>

       Total assets by geographic segment were as follows:
<TABLE>
<CAPTION>
                                                                                         December 31,
                                                                                  ------------------------
                                                                                     2003          2002
                                                                                  -----------  -----------
                                                                                       (In  thousands)

<S>                                                                               <C>          <C>
Jersey.........................................................................   $    50,677  $    52,221
Guernsey.......................................................................         3,408        8,148
United States..................................................................         9,428       11,458
                                                                                  -----------  -----------
Consolidated total assets - continuing operations .............................   $    63,513       71,827
                                                                                  -----------
                                                                                  -----------
Discontinued operations (United States)........................................                      8,390
Elimination due to intercompany balances.......................................                         (4)
                                                                                               -----------
Consolidated total assets as previously reported ..................................            $    80,213
                                                                                               -----------
                                                                                               -----------
</TABLE>
     Revenues and income (loss) before income taxes for the Company's reportable
operating  segments  included in continuing  operations,  based on  management's
internal reporting structure, were as follows:

                                       70
<PAGE>



                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
<TABLE>
<CAPTION>


                                                                                        Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002         2001
                                                                                  -----------  -----------  -----------
                                                                                             (In  thousands)
Revenues:
<S>                                                                               <C>          <C>          <C>
Life insurance and annuities (1).......................................           $     4,458  $    (9,349) $  (155,673)
Venture capital and consulting (2) ....................................                 4,687      (24,519)     (40,670)
                                                                                  -----------  -----------  -----------
                                                                                        9,145      (33,868)    (196,343)
Reconciliation of segment amounts to consolidated amounts:
Interest income .......................................................                    53          531        1,967
                                                                                  -----------  -----------  -----------
Consolidated revenues and net investment gains (losses)
    for continuing operations..........................................           $     9,198  $   (33,337) $  (194,376)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------


Income (loss) from continuing operations before income taxes:
Life insurance and annuities (1).......................................           $     1,577  $   (19,637) $  (163,873)
Venture capital and consulting (2) ....................................                 3,571      (28,149)     (51,262)
                                                                                  -----------  -----------  -----------
                                                                                        5,148      (47,786)    (215,135)
Reconciliation of segment amounts to consolidated amounts:
Interest income .......................................................                    53          531        1,967
Corporate expenses ....................................................                (3,478)      (5,869)      (5,635)
Goodwill amortization and write-offs...................................                     -         (389)         (48)
Interest expense ......................................................                  (676)        (965)      (2,182)
                                                                                  -----------  -----------  -----------
Consolidated income (loss) from continuing operations
    before income taxes ...............................................           $     1,047  $   (54,478) $  (221,033)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
<FN>
(1) Netted  against the revenues  (investment  income) of the life  insurance and  annuities  segment are  management
    fees paid to BCM (discontinued operations) of $5,000, $39,000 and $47,000 in 2003, 2002 and 2001, respectively.

(2) Included in the revenues of the venture capital and consulting segment are management fees from LPLA  (discontinued
    operations) of $0, $2,908,000 and $9,924,000 in 2003, 2002 and 2001, respectively.
</FN>
</TABLE>



     Assets attributable to each of the Company's reportable operating segments,
based on management's reporting structure, were as follows:
<TABLE>
<CAPTION>

                                                                                        December 31,
                                                                                  ------------------------
                                                                                     2003         2002
                                                                                  -----------  -----------
                                                                                       (In  thousands)
Assets:
<S>                                                                               <C>          <C>
Life insurance and annuities...................................................   $    47,929  $    51,557
Venture capital and consulting.................................................         3,442        7,710
Corporate and other............................................................        12,142       12,560
                                                                                  -----------  -----------
Consolidated total assets - continuing operations ..............................  $    63,513       71,827
                                                                                  -----------
                                                                                  -----------
Discontinued operations (BCM and LPA)..............................................                  8,390
Elimination due to intercompany balances...........................................                     (4)
                                                                                               -----------
Consolidated total assets as previously reported ..................................            $    80,213
                                                                                               -----------
                                                                                               -----------
</TABLE>

                                       71
<PAGE>


                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 22.    Selected Quarterly Financial Information (Unaudited)

     Unaudited quarterly financial  information (in thousands,  except per share
and ADS amounts) is as follows:
<TABLE>
<CAPTION>

                                                                                         2003
                                                                 -----------------------------------------------------
                                                                   First     Second      Third     Fourth      Full
                                                                 Quarter(1)  Quarter    Quarter    Quarter      Year
                                                                 ---------  ---------  ---------  ---------  ---------
Continuing operations:
<S>                                                              <C>        <C>        <C>        <C>        <C>
Revenues including net investment gains (losses)........         $   1,524  $   7,829  $  (4,617) $   4,462  $   9,198
Income (loss) before income taxes ......................              (865)     5,448     (6,349)     2,813      1,047
Net income (loss).......................................              (872)     5,443     (6,346)     2,864      1,089

Discontinued operations:
Net income (loss).......................................              (982)    10,909          -          -      9,927

Total continuing and discontinued operations:
Net income (loss) ......................................            (1,854)    16,352     (6,346)     2,864     11,016

Basic earnings (loss) per share:
Continuing operations ..................................         $   (0.02) $    0.11  $   (0.13) $    0.06  $    0.02
Discontinued operations.................................             (0.02)      0.21          -          -       0.20
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (0.04) $    0.32  $   (0.13) $    0.06  $    0.22
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
Basic earnings (loss) per ADS:
Continuing operations ..................................         $   (0.17) $    1.07  $   (1.25) $    0.56  $    0.21
Discontinued operations.................................             (0.20)      2.15          -          -       1.96
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (0.37) $    3.22  $   (1.25) $    0.56  $    2.17
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
Diluted earnings (loss) per share:
Continuing operations ..................................         $   (0.02) $    0.11  $   (0.13) $    0.06  $    0.02
Discontinued operations.................................             (0.02)      0.21          -          -       0.20
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (0.04) $    0.32  $   (0.13) $    0.06  $    0.22
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
Diluted earnings (loss) per ADS:
Continuing operations ..................................         $   (0.17) $    1.06  $   (1.25) $    0.56  $    0.21
Discontinued operations.................................             (0.20)      2.13          -          -       1.94
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (0.37) $    3.19  $   (1.25) $    0.56  $    2.15
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
<FN>
(1) Reclassifications have been made related to discontinued operations - see Note 3.
</FN>
</TABLE>

                                       72
<PAGE>









                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
<TABLE>
<CAPTION>

                                                                                         2002 (1)
                                                                 -----------------------------------------------------
                                                                   First     Second      Third      Fourth     Full
                                                                  Quarter    Quarter    Quarter    Quarter     Year
                                                                 ---------  ---------  ---------  ---------  ---------
Continuing operations:
<S>                                                              <C>        <C>        <C>        <C>        <C>
Revenues including net investment gains (losses)........         $  (4,303) $ (13,794) $  (4,897) $ (10,343) $ (33,337)
Loss before income taxes ...............................            (9,879)   (20,817)   (10,750)   (13,032)   (54,478)
Net loss................................................           (11,030)   (22,979)    (8,952)   (12,808)   (55,769)

Discontinued operations:
Net loss................................................           (19,275)   (86,116)   (41,199)    (3,145)  (149,735)

Total continuing and discontinued operations:
Net loss................................................           (30,305)  (109,095)   (50,151)   (15,953)  (205,504)

Basic loss per share:
Continuing operations ..................................         $   (0.22) $   (0.45) $   (0.18) $   (0.25) $   (1.10)
Discontinued operations.................................             (0.37)     (1.70)     (0.81)     (0.06)     (2.95)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (0.59) $   (2.15) $   (0.99) $   (0.31) $   (4.05)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
Basic loss per ADS: (2)
Continuing operations ..................................         $   (2.17) $   (4.53) $   (1.76) $   (2.52) $  (10.99)
Discontinued operations.................................             (3.80)    (16.97)     (8.12)     (0.62)    (29.50)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (5.97) $  (21.50) $   (9.88) $   (3.14) $  (40.49)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
Diluted loss per share:
Continuing operations ..................................         $   (0.22) $   (0.45) $   (0.18) $   (0.25) $   (1.10)
Discontinued operations.................................             (0.37)     (1.70)     (0.81)     (0.06)     (2.95)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (0.59) $   (2.15) $   (0.99) $   (0.31) $   (4.05)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
Diluted loss per ADS: (2)
Continuing operations ..................................         $   (2.17) $   (4.53) $   (1.76) $   (2.52) $  (10.99)
Discontinued operations.................................             (3.80)    (16.97)     (8.12)     (0.62)    (29.50)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 $   (5.97) $  (21.50) $   (9.88) $   (3.14) $  (40.49)
                                                                 ---------  ---------  ---------  ---------  ---------
                                                                 ---------  ---------  ---------  ---------  ---------
<FN>
(1)  Reclassifications have been made related to discontinued operations - see Note 3.

(2)  ADS amounts have been restated to reflect the one-for-ten reverse split in June 2002.
</FN>
</TABLE>

     Due to the  method  required  by SFAS 128 to  calculate  per  share and ADS
amounts,  the  quarterly per share and ADS amounts do not total to the full year
per share and ADS amounts.

                                       73
<PAGE>


Item 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE

     Following the resignation of  PricewaterhouseCoopers  on June 19, 2002, BDO
International  and BDO Seidman,  LLP were appointed by the Board of Directors as
the  Company's  independent  auditors  with  effect  from  July  31,  2002.  BDO
International  transferred  their  business  from  a  partnership  to a  limited
liability  partnership  ("LLP") with effect from  January 1, 2004.  All non-U.S.
audit services are now provided by BDO Stoy Hayward,  LLP, who were re-appointed
as the Company's auditors on January 28, 2004.

     In connection  with the audit for the year ended December 31, 2001, and the
review of the Company's  unaudited interim financial  statements for the quarter
ended  March 31,  2002,  there were no  disagreements  between  the  Company and
PricewaterhouseCoopers  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  PricewaterhouseCoopers
would  have  caused  them to make  reference  thereto  in  their  report  on the
financial  statements  for such  periods,  except that there were  disagreements
between    the    Company's    management    and    the    representatives    of
PricewaterhouseCoopers  with respect to the nature, extent and categorization of
the impairment  reviews and fair value  evaluations  of portfolio  securities in
accordance with Statement of Financial Accounting Standard No. 115 ("SFAS 115"),
"Accounting  for  Certain  Investments  in Debt and  Equity  Securities."  These
disagreements on the application of SFAS 115 were  subsequently  resolved to the
satisfaction of PricewaterhouseCoopers.

     PricewaterhouseCoopers  and the Audit  Committee  of the Board of Directors
discussed  the  foregoing.  The  Company  authorized  PricewaterhouseCoopers  to
respond fully to the inquiries of the successor auditors  concerning the subject
matter of the foregoing.

     In  connection  with the audit for the year ended  December 31,  2001,  and
through  June 19,  2002,  there were no  "reportable  events" as defined  within
Regulation S-K Item 304(a)1(v)(A),  except that, in connection with its audit of
the Company's financial  statements for the year ended December 31, 2001 and its
review of the Company's  unaudited interim financial  statements for the quarter
ended March 31, 2002, PricewaterhouseCoopers  recommended that steps be taken to
establish  an internal  audit  function,  improve the  production  of timely and
reliable  financial  reports in accordance with U.S. GAAP, and to strengthen the
corporate governance structure.

     In response to these  recommendations,  all members of the Audit  Committee
now participate in all Audit Committee meetings. The loss of control of the U.S.
life insurance  subsidiary in August 2002 reduced the size and complexity of the
Group considerably.  After discussion with the new auditors, the Audit Committee
determined  that the  appointment  of an internal  auditor was not necessary and
that the U.S.  GAAP  expertise  within  the  Company,  as  supported  by outside
consultants when deemed necessary, is sufficient.


Item 9A.  CONTROLS AND PROCEDURES

     We maintain  disclosure  controls  and  procedures  designed to ensure that
information  required  to be  disclosed  in our  filings  under  the  Securities
Exchange  Act of 1934,  as  amended,  is  recorded,  processed,  summarized  and
reported  within the periods  specified in the rules and forms of the Securities
and Exchange Commission. Such information is accumulated and communicated to our
management,  including our chief executive officer and chief financial  officer,
as appropriate,  to allow timely decisions  regarding required  disclosure.  Our
management,  including  the chief  executive  officer  and the  chief  financial
officer,  recognizes that any set of controls and procedures, no matter how well
designed and operated,  can provide only  reasonable  assurance of achieving the
desired control objectives.

     As of the end of the period  covered by this annual report on Form 10-K, we
carried out an evaluation,  under the supervision and with the  participation of
our  management,  including  our chief  executive  officer  and chief  financial
officer,  of the  effectiveness  of the design and  operation of our  disclosure
controls and procedures.  Based on such evaluation,  our chief executive officer
and  chief  financial  officer  concluded  that  our

                                       74
<PAGE>

disclosure  controls and  procedures  are  effective in timely  alerting them to
material information required to be included in our periodic SEC filings.

     There have been no significant changes in our internal controls or in other
factors that could  materially  affect the internal  controls  subsequent to the
date of their  evaluation  in  connection  with the  preparation  of this annual
report on Form 10-K.


                                    PART III

     Certain information required by Part III is omitted from this Form 10-K and
is  incorporated  by reference to our definitive  Proxy Statement for the Annual
Meeting of Shareholders  to be held on August 4, 2004 (the  "Proxy  Statement"),
which  will be filed  with the SEC not later  than 120 days after the end of the
fiscal year covered by this Form 10-K.


Item 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     Our executive officers are as follows:

     Arthur I. Trueger,  Executive Chairman: Mr. Trueger, age 55, is the founder
and a principal shareholder of Berkeley Technology Limited. He has worked for us
for more than 27 years and holds A.B., M.A. and J.D. degrees from the University
of California.

     Ian K. Whitehead,  Chief Financial Officer: Mr. Whitehead, age 49, has held
the position of Chief Financial Officer of Berkeley  Technology Limited since he
joined us in 1990.  Mr.  Whitehead  is a member of the  Institute  of  Chartered
Accountants in England and Wales.

     Information  regarding  our directors is  incorporated  by reference to the
sections  entitled  "Proposal 2 - Election of Director"  and "Board of Directors
and Committees" in the Proxy Statement.

     Information  regarding  compliance  with  Section  16(a) of the  Securities
Exchange Act of 1934, as amended,  is  incorporated  by reference to the section
entitled "Other Information About Directors and Executive Officers" in the Proxy
Statement.

     Information regarding our Code of Ethics,  adopted on November 12, 2003, is
incorporated by reference to the section  entitled "Code of Ethics" in the Proxy
Statement. Our Code of Ethics is filed as Exhibit 14.1 of this Form 10-K.


Item 11.  EXECUTIVE COMPENSATION

     The  information  required by this Item is incorporated by reference to the
sections entitled "Executive Compensation" and "Directors'  Compensation" in our
Proxy Statement.


Item 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
          RELATED STOCKHOLDER MATTERS

     The information  regarding  security ownership of certain beneficial owners
and management is incorporated by reference to the section entitled "Information
Regarding  Beneficial  Ownership  of  Principal   Shareholders,   Directors  and
Executive Officers" in our Proxy Statement.

                                       75
<PAGE>




     The  following  table is a summary of selected  information  for our equity
compensation plans as of December 31, 2003.
<TABLE>
<CAPTION>

                                                                                                   Number of Shares
                                            Number of Shares to        Weighted-Average     Remaining Available for
                                        be Issued Upon Exercise       Exercise Price of       Future Issuance Under
                                        of Outstanding Options,    Outstanding Options,         Equity Compensation
                                            Warrants and Rights     Warrants and Rights                       Plans
                                        -----------------------    --------------------      ----------------------

<S>                                             <C>                             <C>                             <C>
Equity compensation plans
  approved by shareholders..............              8,945,000(1)                $3.10                         (1)

Equity compensation plans not
  approved by shareholders..............                388,100(1)                 3.73                         (1)
                                                ---------------                --------
Total...................................              9,333,100                   $3.13
                                                ---------------                --------
                                                ---------------                --------
<FN>
(1) Our equity  compensation  plans do not  contain a limit on the number of options  that may be granted to  employees.
    However,  the plans do not allow for the issuance of  previously  authorized  and unissued  shares to meet the
    obligations  of the plans upon an employee  option  exercise.  When an option is granted,  the trust that  administers
    the plan borrows  funds from us or one of our subsidiaries  and uses those funds to purchase the number of shares
    underlying  the option grant.  The maximum loan allowed in any given year is equal to 5% of consolidated net assets
    as of the end of the previous fiscal year.
</FN>
</TABLE>

     Information  regarding  the  features of the equity  compensation  plan not
approved  by  shareholders  is  incorporated  by  reference  to  Note  17 to the
Consolidated Financial Statements in Item 8 of this Form 10-K.


Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The  information  required by this Item is incorporated by reference to the
section entitled "Other  Information About Directors and Executive  Officers" in
our Proxy Statement.


Item 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

     The  information  required by this Item is incorporated by reference to the
section  entitled  "Report of the Audit  Committee of the Board of Directors" in
our Proxy Statement.


                                     PART IV

Item 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) The following documents are filed as a part of this Form 10-K:


1.  Financial Statements:                                                   Page

     The following  consolidated financial statements of us and
     subsidiaries are included in Item 8:

       Reports of Independent Certified Public Accountants................... 28

       Consolidated Balance Sheets as of December 31, 2003 and 2002 ......... 30

       Consolidated Statements of Income for the Years Ended
           December 31, 2003, 2002 and 2001 ................................. 31


                                       76
<PAGE>

       Consolidated Statements of Cash Flows for the Years Ended
           December 31, 2003, 2002 and 2001 ................................. 33

       Consolidated Statements of Changes in Shareholders' Equity for the
           Years Ended December 31, 2003, 2002 and 2001 ..................... 35

       Consolidated Statements of Comprehensive Income for the Years Ended
           December 31, 2003, 2002 and 2001 ................................. 37

       Notes to the Consolidated Financial Statements ....................... 38

2.   Financial Statement Schedules:

     The following financial statement schedules of Berkeley  Technology Limited
     and subsidiaries are included in this Form 10-K immediately  following Item
     15 and  should  be  read  in  conjunction with the  consolidated  financial
     statements and notes thereto included in Item 8:

       Schedule I - Summary of Investments - Other Than Investments in
           Related Parties .................................................. 81

       Schedule II - Condensed Financial Information of Registrant

           Condensed Balance Sheets as of December 31, 2003 and 2002 ........ 82
           Condensed Statements of Income for the Years Ended
             December 31, 2003, 2002 and 2001 ............................... 83

           Condensed Statements of Cash Flows for the Years Ended
             December 31, 2003, 2002 and 2001 ............................... 84

           Note to Condensed Financial Statements ........................... 85

       Schedule III - Supplementary Insurance Information ................... 86


     All other financial  statement  schedules  required by  Regulation S-X have
     been omitted because they are  not  applicable or the required  information
     is included in the applicable  consolidated  financial  statements or notes
     thereto in  Item 8  "Financia  Statements  and Supplementary  Data" of this
     Form 10-K.

3.       Exhibits:

     The following  exhibits of Berkeley  Technology  Limited  and  subsidiaries
     are filed herewith or incorporated by reference as indicated below:

 Exhibit
  Number   Description
---------  -----------

3.(I).1    Memorandum  and  Articles  of  Association  of  Berkeley   Technology
           Limited,  as amended and restated on April 18, 2000 (filed previously
           as  Exhibit  3.(I) to our Form 10-Q for the  quarter  ended  June 30,
           2000).

3.(I).2    Certificate of Incorporation on Change of Name dated June 12, 2003.

4.1        Specimen Ordinary Share certificate  (filed previously as Exhibit 4.1
           to our Form 10-K for the year ended December 31, 2000).

                                       77
<PAGE>

4.2        Form of Deposit  Agreement  dated  September 25, 1992, as amended and
           restated as of November 24, 1993, as further  amended and restated as
           of March 14, 2000, among us, The Bank of New York as Depositary,  and
           all  Owners  and  Holders  from time to time of  American  Depositary
           Receipts  issued  thereunder  (filed  previously  as Exhibit A to our
           Registration Statement on Form F-6 (Registration No. 333-11658) dated
           March 14, 2000).

4.3        Letter  Agreement  dated August 25, 1992 between The Bank of New York
           and us  covering  the Basic  Administration  Charge  relating  to the
           Deposit  Agreement (shown above as Exhibit 4.2) (filed  previously as
           Exhibit 3.8 to our Post-Effective Amendment No. 2 to our Registration
           Statement on Form 20-F/A dated August 31, 1993).

4.4        Form of Deposit  Agreement  as amended  and  restated  as of June 24,
           2002,  among us, The Bank of New York as  Depositary,  and all Owners
           and Holders from time to time of American  Depositary Receipts issued
           thereunder  (filed previously as Exhibit 4.4 to our Form 10-Q for the
           quarter ended June 30, 2002).

4.5        Warrant Agreement dated February 14, 2003 between us and the Governor
           and  Company of the Bank of  Scotland  relating  to the Term Loan and
           Guarantee  Facility  dated  December  20, 2002 (filed  previously  as
           Exhibit 4.5 to our Form 10-Q for the quarter ended March 31, 2003).

4.6        Specimen Ordinary Share certificate, as amended on June 12, 2003.

10.1.1     Multicurrency  Term Facility  Agreement  dated May 2, 2000 between us
           and  the  Governor  and  Company  of  the  Bank  of  Scotland  (filed
           previously  as Exhibit  10.1.1 to our Form 10-Q for the quarter ended
           September 30, 2000).

10.1.2     Term Loan and Guarantee Facility of up to $23,000,000, dated December
           20,  2002  between  us and the  Governor  and  Company of the Bank of
           Scotland (filed previously as Exhibit 10.1.2 to our Form 10-K for the
           year ended December 31, 2002).

10.1.3     Stock  Pledge  Agreement  dated  January  29, 2003  between  Berkeley
           International  Capital  Limited and the  Governor  and Company of the
           Bank of Scotland,  relating to the Term Loan and  Guarantee  Facility
           dated  December 20, 2002 (filed  previously as Exhibit  10.1.3 to our
           Form 10-Q for the quarter ended March 31, 2003).

10.1.4     Stock  Pledge  Agreement  dated  February  7, 2003  between  Berkeley
           International  Capital  Limited and the  Governor  and Company of the
           Bank of Scotland,  relating to the Term Loan and  Guarantee  Facility
           dated  December 20, 2002 (filed  previously as Exhibit  10.1.4 to our
           Form 10-Q for the quarter ended March 31, 2003).

10.1.5     Stock Pledge Agreement dated February 19, 2003 between Berkeley (USA)
           Holdings  Limited  and  the  Governor  and  Company  of the  Bank  of
           Scotland,  relating  to the Term Loan and  Guarantee  Facility  dated
           December  20, 2002 (filed  previously  as Exhibit  10.1.5 to our Form
           10-Q for the quarter ended March 31, 2003).

10.1.6     Security  Agreement  dated  February  28,  2003  between  us and  the
           Governor  and  Company of the Bank of  Scotland  relating to the Term
           Loan and Guarantee Facility dated December 20, 2002 (filed previously
           as Exhibit  10.1.6 to our Form 10-Q for the  quarter  ended March 31,
           2003).

10.2.1     Settlement  dated  February  16,  1990 among (1) us, (2) John  Gerald
           Patrick  Wheeler and (3) Ian Walter Strang,  constituting  The London
           Pacific Group 1990 Employee  Share Option Trust (filed  previously as
           Exhibit 3.2 to our  Post-Effective  Amendment  No. 2 to  Registration
           Statement on Form 20-F/A dated August 31, 1993).

                                       78
<PAGE>

10.2.2     Executed  Instrument  dated  March 18,  1994  among  (1) John  Gerald
           Patrick Wheeler,  (2) Ian Walter Strang and (3) Richard John Pirouet,
           relating to The London Pacific Group 1990 Employee Share Option Trust
           (filed  previously as Exhibit 3.2.1 to our Annual Report on Form 20-F
           dated June 10, 1994).

10.2.3     Executed  Instrument  dated  September  27, 1994 among (1) Ian Walter
           Strang,  (2)  Richard  John  Pirouet  and (3)  Clive  Aubrey  Charles
           Chaplin,  relating to The London  Pacific Group 1990  Employee  Share
           Option Trust (filed  previously as Exhibit 3.2.2 to our Annual Report
           on Form 20-F dated June 29, 1995).

10.2.4     Executed  Instrument dated March 3, 1995 among (1) Ian Walter Strang,
           (2)  Richard  John  Pirouet  and (3) Clive  Aubrey  Charles  Chaplin,
           relating to The London Pacific Group 1990 Employee Share Option Trust
           (filed  previously as Exhibit 3.2.3 to our Annual Report on Form 20-F
           dated June 29, 1995).

10.2.5     Executed  Instrument  dated  August 22, 1996 among (1)  Richard  John
           Pirouet,  (2) Clive  Aubrey  Charles  Chaplin and (3) Ronald  William
           Green,  relating  to The London  Pacific  Group 1990  Employee  Share
           Option Trust (filed  previously as Exhibit 3.2.4 to our Annual Report
           on Form 20-F dated June 30, 1997).

10.2.6     Executed  Instrument  dated  August 29, 1998 among (1)  Richard  John
           Pirouet,  (2) Clive Aubrey Charles Chaplin,  (3) Ronald William Green
           and (4) Victor Aloysius Hebert,  relating to The London Pacific Group
           1990 Employee  Share Option Trust (filed  previously as Exhibit 3.2.5
           to our Annual Report on Form 20-F dated June 30, 1999).

10.2.7     Executed  Instrument  dated  May 31,  2000  among  (1)  Richard  John
           Pirouet,  (2) Clive Aubrey Charles Chaplin,  (3) Ronald William Green
           and (4) Victor Aloysius Hebert,  relating to The London Pacific Group
           1990 Employee Share Option Trust (filed  previously as Exhibit 10.2.1
           to our Form 10-Q for the quarter ended September 30, 2000).

10.2.8     Executed  Instrument  dated  May 31,  2000  among  (1)  Richard  John
           Pirouet,  (2) Clive Aubrey Charles Chaplin, (3) Ronald William Green,
           (4) Victor Aloysius Hebert and (5) Christopher Byrne, relating to The
           London   Pacific  Group  1990  Employee  Share  Option  Trust  (filed
           previously  as Exhibit  10.2.2 to our Form 10-Q for the quarter ended
           September 30, 2000).

10.3.1(1)  Agreement  dated  July 1, 1990 between  us  and Ian Kenneth Whitehead
           (filed  previously  as  Exhibit  10.3.1 to our Form 10-K for the year
           ended December 31, 2000).

10.3.2(1)  Berkeley  (USA) Holdings  Limited  Amended and Restated 1993 Deferred
           Compensation  Plan dated  December  16,  1999  (filed  previously  as
           Exhibit  10.3.2  to our Form  10-K for the year  ended  December  31,
           2000).

10.3.3(1)  London Pacific Advisers Limited Retirement Scheme  confirmation dated
           December  5, 2000 for Ian  Kenneth  Whitehead  (filed  previously  as
           Exhibit  10.3.3  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.1     Settlement  dated May 23, 1997 among BG Services Limited and A.L.O.T.
           Trustee Limited  establishing Agent Loyalty  Opportunity Trust (filed
           previously  as  Exhibit  10.4.1 to our Form  10-K for the year  ended
           December 31, 2001).

10.4.2     Executed  Deed  dated  July  16,  1997 by  A.L.O.T.  Trustee  Limited
           relating to Agent  Loyalty  Opportunity  Trust (filed  previously  as
           Exhibit  10.4.2  to our Form  10-K for the year  ended  December  31,
           2001).

                                       79
<PAGE>

10.4.3     Executed  Deed dated  August 13,  1997 by  A.L.O.T.  Trustee  Limited
           relating to Agent  Loyalty  Opportunity  Trust (filed  previously  as
           Exhibit  10.4.3  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.4     Executed  Deed dated  August 20,  1998 by  A.L.O.T.  Trustee  Limited
           relating to Agent  Loyalty  Opportunity  Trust (filed  previously  as
           Exhibit  10.4.4  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.5     Executed Deed of Amendment and  Appointment  dated  December 11, 2001
           among Berkeley  International  Capital  Limited and A.L.O.T.  Trustee
           Limited relating to Agent Loyalty Opportunity Trust (filed previously
           as Exhibit  10.4.5 to our Form 10-K for the year ended  December  31,
           2001).

10.5       Asset Purchase Agreement dated March 7, 2003 between Berkeley Capital
           Management  ("BCM"),  Berkeley  (USA)  Holdings  Limited and Berkeley
           Capital  Management LLC relating to the sale of substantially  all of
           the assets and operations of BCM (filed previously as Exhibit 10.5 to
           our Form 10-Q for the quarter ended March 31, 2003).

10.6       Purchase Agreement,  dated May 9, 2003, for the acquisition of London
           Pacific Advisory Services,  Inc. and London Pacific Securities,  Inc.
           by SunGard Business Systems Inc. (filed previously as Exhibit 10.6 to
           our Form 10-Q for the quarter ended June 30, 2003).

14.1       Code of Ethics.

21         Subsidiaries of the Company as of February 27, 2004.

31.1       Certification  by the  Company's  Executive  Chairman  pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  302 of the
           Sarbanes-Oxley Act of 2002.

31.2       Certification by the Company's Chief Financial Officer pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  302 of the
           Sarbanes-Oxley Act of 2002.

32.1       Certification  by the  Company's  Executive  Chairman  pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  906 of the
           Sarbanes-Oxley Act of 2002.

32.2       Certification by the Company's Chief Financial Officer pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  906 of the
           Sarbanes-Oxley Act of 2002.


__________

(1)        Management contract or compensatory  arrangement filed in response to
           Item 15(a)(3) of the instructions to Form 10-K.


(b)    Reports on Form 8-K:

       We filed one current report on Form 8-K during the fourth quarter of 2003
       as follows:

       (1) The  Form  8-K  filed on  November  14, 2003 announcing our financial
           results for the quarter ended September 30, 2003.

(c)    Our exhibits are listed in Item 15(a)(3) above.

(d)    Our financial statement schedules follow on pages 81 through 86.

                                       80
<PAGE>

                      SCHEDULE I - SUMMARY OF INVESTMENTS -
                    OTHER THAN INVESTMENTS IN RELATED PARTIES

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                             As of December 31, 2003
<TABLE>
<CAPTION>
                            Column A                                   Column B     Column C     Column D

                                                                                                Amount at
                                                                                               Which Shown
                                                                                             in Consolidated
                                                                                      Fair       Balance
                       Type of Investments                             Cost (1)       Value     Sheet (2)
-----------------------------------------------------------------    -----------  -----------  -----------
                                                                                (In thousands)
Fixed maturity securities:
Bonds:
<S>                                                                  <C>          <C>          <C>
   United States government and government
     agencies and authorities...................................     $         -  $         -  $         -
   States, municipalities and political subdivisions............               -            -            -
   Foreign governments..........................................               -            -            -
   Public utilities.............................................               -            -            -
   Convertibles and bonds with warrants attached................               -            -            -
   All other corporate bonds....................................          25,403       25,393       25,393
Redeemable preferred stock......................................               -            -            -
                                                                     -----------  -----------  -----------
Total fixed maturity securities.................................          25,403  $    25,393       25,393
                                                                     -----------  -----------  -----------
                                                                                  -----------
Equity securities:
Common stocks:
   Industrial, miscellaneous and all other......................           4,587  $    16,925       16,925
Non-redeemable preferred stocks.................................           4,219        4,219        4,219
                                                                     -----------  -----------  -----------
Total equity securities.........................................           8,806  $    21,144       21,144
                                                                     -----------  -----------  -----------
                                                                                  -----------
Total investments...............................................     $    34,209               $    46,537
                                                                     -----------               -----------
                                                                     -----------               -----------
<FN>
(1) Cost of fixed  maturity  securities is original  cost,  reduced by  other-than-temporary  impairments,
    repayments and adjusted for amortization of premiums and accretion of discounts.  Cost of equity securities
    is original cost,  reduced by  other-than-temporary impairments.

(2) Differences  between  amounts  reflected  in Column B or Column C and  amounts at which  shown in the
    consolidated  balance  sheet reflected in Column D result from the application of Statement of Financial
    Accounting  Standards No. 115, "Accounting for Certain Investments  in  Debt  and  Equity  Securities."
    Fixed  maturity  securities  are  classified  as  either   available-for-sale  or held-to-maturity.
    Available-for-sale  securities are recorded at fair value,  with changes in unrealized gains and losses
    excluded from net income,  but reported net of applicable  taxes and  adjustments to deferred  policy
    acquisition  cost  amortization  as a separate component of comprehensive income.  Held-to-maturity
    securities are recorded at amortized cost.
</FN>
</TABLE>

                                       81
<PAGE>


           SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT

                           BERKELEY TECHNOLOGY LIMITED
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                         December 31,
                                                                                  ------------------------
                                                                                     2003        2002 (1)
                                                                                  -----------  -----------
                                                                             (In thousands, except share amounts)
                                     ASSETS

<S>                                                                               <C>          <C>
Cash and cash equivalents .....................................................   $     2,496  $        27
Investment in subsidiaries ....................................................       (57,714)     (74,519)
Intercompany balances .........................................................       121,636      121,720
Other assets ..................................................................           247          620
                                                                                  -----------  -----------
Total assets ..................................................................   $    66,665  $    47,848
                                                                                  -----------  -----------
                                                                                  -----------  -----------


                      LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
Accounts payable and accruals .................................................   $       299  $       403
Guarantees under bank facility.................................................             -       10,590
Intercompany balances .........................................................        31,469       15,369
                                                                                  -----------  -----------
Total liabilities .............................................................        31,768       26,362
                                                                                  -----------  -----------
Commitments and contingencies

Shareholders' equity:
Ordinary shares, $0.05 par value per share: 86,400,000 shares authorized;
   64,439,073 shares issued and outstanding as of December 31, 2003
   and 2002....................................................................         3,222        3,222
Additional paid-in capital ....................................................        68,615       68,394
Retained earnings .............................................................        27,070       16,054
Employee benefit trusts, at cost (13,684,881 shares as of December 31,
   2003 and 2002) .............................................................       (63,571)     (63,571)
Accumulated other comprehensive loss ..........................................          (439)      (2,613)
                                                                                  -----------  -----------
Total shareholders' equity ....................................................        34,897       21,486
                                                                                  -----------  -----------
Total liabilities and shareholders' equity ....................................   $    66,665  $    47,848
                                                                                  -----------  -----------
                                                                                  -----------  -----------
<FN>
(1) Reclassifications  have been made related to discontinued  operations - see Note 3 to the Consolidated
    Financial Statements in Item 8 of Form 10-K for the year ended December 31, 2003.
</FN>
</TABLE>



            See accompanying Note to Condensed Financial Statements.

                                       82
<PAGE>



     SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Continued)

                           BERKELEY TECHNOLOGY LIMITED
                         CONDENSED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
                                                                                          Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002        2001(1)
                                                                                  -----------  -----------  -----------
                                                                                           (In thousands)
Revenues:
<S>                                                                               <C>          <C>          <C>
Investment income............................................................     $         8  $       128  $       605
Interest and fees from subsidiaries, net (2).................................               -          307       15,047
Distribution from subsidiary (2).............................................               -            -       52,462
Net realized investment losses...............................................            (246)     (10,827)           -
                                                                                 ------------  -----------  -----------
                                                                                         (238)     (10,392)      68,114
Expenses:
Staff costs..................................................................             833        2,277        3,180
Escrow release...............................................................               -         (100)        (100)
Other operating expenses.....................................................           2,584        2,840        2,579
                                                                                  -----------  -----------  -----------
                                                                                        3,417        5,017        5,659
                                                                                  -----------  -----------  -----------
Income (loss) before income tax expense and equity in
   undistributed net income (loss) of subsidiaries...........................          (3,655)     (15,409)      62,455

Income tax expense (benefit).................................................               -         (683)       1,579
                                                                                  -----------  -----------  -----------
Income before equity in undistributed net income (loss) of
   subsidiaries..............................................................          (3,655)     (14,726)      60,876

Equity in undistributed net income (loss) of subsidiaries (2)................          14,671     (190,317)    (284,921)
                                                                                  -----------  -----------  -----------
Income (loss) from continuing operations ....................................          11,016     (205,043)    (224,045)
                                                                                  -----------  -----------  -----------

Discontinued operations:
Loss on disposal of discontinued operations, net of income tax
   benefit of $0.............................................................               -         (461)           -
Equity in undistributed net loss of discontinued operations (2)..............               -            -     (120,739)
                                                                                  -----------  -----------  -----------
Loss on discontinued operations..............................................               -         (461)    (120,739)
                                                                                  -----------  -----------  -----------

Net income (loss) ...........................................................     $    11,016  $  (205,504) $  (344,784)
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
<FN>
(1) Reclassifications  have been made related to discontinued  operations - see Note 3 to the Consolidated Financial
    Statements in Item 8 of Form 10-K for the year ended December 31, 2003.

(2) Eliminated on consolidation.
</FN>
</TABLE>

            See accompanying Note to Condensed Financial Statements.

                                       83
<PAGE>

     SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Continued)

                           BERKELEY TECHNOLOGY LIMITED
                       CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                                         Years Ended December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002        2001(1)
                                                                                  -----------  -----------  -----------
                                                                                             (In thousands)
Cash flows from continuing operating activities:
<S>                                                                               <C>          <C>          <C>
Net income (loss)............................................................     $    11,016  $  (205,043) $  (224,045)

Adjustments to reconcile net income (loss) to net
   cash provided by (used in) operating activities:
Equity in undistributed net income (loss) of subsidiaries....................         (14,671)     190,317      284,921
Distribution from subsidiary.................................................               -            -      (52,462)
Net realized investment (gains) losses.......................................             246       10,827            -
Taxes........................................................................               -       (2,162)           -
Other operating cash flows ..................................................             489         (532)         299
                                                                                  -----------  -----------  -----------
Net cash provided by (used in) operating activities .........................          (2,920)      (6,593)       8,713
                                                                                  -----------  -----------  -----------
Cash flows from investing activities:
Payment of guarantee obligations.............................................         (10,836)           -            -
Investment in subsidiaries ..................................................               -            -      (33,380)
Distributions from subsidiary ...............................................               -            -       52,462
Advances to subsidiaries ....................................................            (144)           -      (39,410)
Other cash flows from investing activities ..................................               -            -          (23)
                                                                                  -----------  -----------  -----------
Net cash used in investing activities .......................................         (10,980)           -      (20,351)
                                                                                  -----------  -----------  -----------
Cash flows from financing activities:
Dividends paid ..............................................................               -       (2,032)     (11,801)
Issuance of Ordinary Shares .................................................               -            -            3
Repayments from subsidiaries ................................................          16,369          155            -
                                                                                  -----------  -----------  -----------
Net cash provided by (used in) financing activities .........................          16,369       (1,877)     (11,798)
                                                                                  -----------  -----------  -----------

Net increase (decrease) in cash and cash equivalents ........................           2,469       (8,470)     (23,436)
Cash and cash equivalents at beginning of year ..............................              27        8,497       31,933
                                                                                  -----------  -----------  -----------
Cash and cash equivalents at end of year ....................................     $     2,496   $       27  $     8,497
                                                                                  -----------  -----------  -----------
                                                                                  -----------  -----------  -----------
<FN>
(1) Reclassifications  have been made related to discontinued  operations - see Note 3 to the Consolidated Financial
    Statements in Item 8 of Form 10-K for the year ended December 31, 2003.
</FN>
</TABLE>

            See accompanying Note to Condensed Financial Statements.

                                       84
<PAGE>

     SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Continued)

                           BERKELEY TECHNOLOGY LIMITED
                     NOTE TO CONDENSED FINANCIAL STATEMENTS


Note 1.    Basis of Presentation and Significant Accounting Policies

     The   accompanying financial statements comprise  a condensed  presentation
of  financial  position,  results  of  operations  and cash  flows  of  Berkeley
Technology  Limited (the "Company") on a separate company basis. These condensed
financial statements do not include the accounts of the Company's  subsidiaries,
but instead include the Company's  investment in those  subsidiaries,  stated at
amounts which are equal to the Company's equity in the subsidiaries' net assets.
The  consolidated  financial  statements of the Company and its subsidiaries are
included in Item 8 of this Form 10-K for the year ended December 31, 2003.

     Additional  information  about the  significant accounting policies applied
by the Company and its  subsidiaries  is included in Note 2 to the  Consolidated
Financial Statements in Item 8 of this Form 10-K for the year ended December 31,
2003.

                                       85
<PAGE>



               SCHEDULE III - SUPPLEMENTARY INSURANCE INFORMATION

                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

          Life Insurance and Annuities Segment (Continuing Operations)

<TABLE>
<CAPTION>

                                                                                      Years Ended/As of December 31,
                                                                                  -------------------------------------
                                                                                     2003         2002        2001(1)
                                                                                  -----------  -----------  -----------
                                                                                              (In thousands)


<S>                                                                               <C>          <C>          <C>
Deferred policy acquisition costs..........................................       $         -  $         -  $     3,113


Future policy benefits, losses, claims and loss expenses (2) ..............            28,054       35,441      131,765


Unearned premiums..........................................................               N/A          N/A          N/A


Other policy claims and benefits payable (2)...............................                 -            -           66


Premium revenue (3)........................................................                 6        1,155           (7)


Net investment income (4) .................................................             1,834        6,060        6,214


Benefits, claims, losses and settlement expenses...........................               N/A          N/A          N/A


Amortization of deferred policy acquisition costs..........................                 -        2,952          932


Other operating expenses...................................................               959        1,294          955


Premiums written...........................................................               N/A          N/A          N/A


---------------------------
<FN>
(1) Reclassifications  have been made related to discontinued  operations - see Note 3 to the Consolidated Financial Statements
    in Item 8 of this Form 10-K for the year ended December 31, 2003.

(2) For additional disclosure regarding life insurance policy liabilities, see Note 10 to the Consolidated Financial Statements
    in Item 8 of this Form 10-K for the year ended December 31, 2003.

(3) Insurance policy charges.

(4) Expenses related to the management and administration of investments have been netted with investment income in the
    determination of net investment income.
</FN>
</TABLE>

                                       86
<PAGE>




                                   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.


                                                 BERKELEY TECHNOLOGY LIMITED
                                                 (Registrant)

                                                 By     /s/  Arthur I. Trueger

Date:  March 10, 2004                                   Arthur I. Trueger
                                                        Executive Chairman


      Pursuant to the requirements of the Securities  Exchange Act of 1934, this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
registrant and in the capacities and on the dates indicated.


                                    /s/  Arthur I. Trueger
Date:  March 10, 2004               Arthur I. Trueger
                                    Executive Chairman
                                    (Principal Executive Officer)


                                    /s/  Ian K. Whitehead
Date:  March 10, 2004               Ian K. Whitehead
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)


                                    /s/  Victor A. Hebert
Date:  March 10, 2004               Victor A. Hebert
                                    Deputy Chairman and Non-Executive Director


                                    /s/  John Clennett
Date:  March 10, 2004               John Clennett
                                    Non-Executive Director


                                    /s/  Harold E. Hughes, Jr.
Date:  March 10, 2004               Harold E. Hughes, Jr.
                                    Non-Executive Director


                                    /s/  The Viscount Trenchard
Date:  March 10, 2004               The Viscount Trenchard
                                    Non-Executive Director



                                       87
<PAGE>






                  BERKELEY TECHNOLOGY LIMITED AND SUBSIDIARIES

                EXHIBIT INDEX FOR THE ANNUAL REPORT ON FORM 10-K
                      FOR THE YEAR ENDED DECEMBER 31, 2003

Exhibit
Number     Description
--------   -----------

3.(I).1    Memorandum  and  Articles  of  Association  of  Berkeley   Technology
           Limited,  as amended and restated on April 18, 2000 (filed previously
           as  Exhibit  3.(I) to our Form 10-Q for the  quarter  ended  June 30,
           2000).

3.(I).2    Certificate of Incorporation on Change of Name dated June 12, 2003.

4.1        Specimen Ordinary Share certificate  (filed previously as Exhibit 4.1
           to our Form 10-K for the year ended December 31, 2000).

4.2        Form of Deposit  Agreement  dated  September 25, 1992, as amended and
           restated as of November 24, 1993, as further  amended and restated as
           of March 14, 2000, among us, The Bank of New York as Depositary,  and
           all  Owners  and  Holders  from time to time of  American  Depositary
           Receipts  issued  thereunder  (filed  previously  as Exhibit A to our
           Registration Statement on Form F-6 (Registration No. 333-11658) dated
           March 14, 2000).

4.3        Letter  Agreement  dated August 25, 1992 between The Bank of New York
           and us  covering  the Basic  Administration  Charge  relating  to the
           Deposit  Agreement (shown above as Exhibit 4.2) (filed  previously as
           Exhibit 3.8 to our Post-Effective Amendment No. 2 to our Registration
           Statement on Form 20-F/A dated August 31, 1993).

4.4        Form of Deposit  Agreement  as amended  and  restated  as of June 24,
           2002,  among us, The Bank of New York as  Depositary,  and all Owners
           and Holders from time to time of American  Depositary Receipts issued
           thereunder  (filed previously as Exhibit 4.4 to our Form 10-Q for the
           quarter ended June 30, 2002).

4.5        Warrant Agreement dated February 14, 2003 between us and the Governor
           and  Company of the Bank of  Scotland  relating  to the Term Loan and
           Guarantee  Facility  dated  December  20, 2002 (filed  previously  as
           Exhibit 4.5 to our Form 10-Q for the quarter ended March 31, 2003).

4.6        Specimen Ordinary Share certificate, as amended on June 12, 2003.

10.1.1     Multicurrency  Term Facility  Agreement  dated May 2, 2000 between us
           and  the  Governor  and  Company  of  the  Bank  of  Scotland  (filed
           previously  as Exhibit  10.1.1 to our Form 10-Q for the quarter ended
           September 30, 2000).

10.1.2     Term Loan and Guarantee Facility of up to $23,000,000, dated December
           20,  2002  between  us and the  Governor  and  Company of the Bank of
           Scotland (filed previously as Exhibit 10.1.2 to our Form 10-K for the
           year ended December 31, 2002).

10.1.3     Stock  Pledge  Agreement  dated  January  29, 2003  between  Berkeley
           International  Capital  Limited and the  Governor  and Company of the
           Bank of Scotland,  relating to the Term Loan and  Guarantee  Facility
           dated  December 20, 2002 (filed  previously as Exhibit  10.1.3 to our
           Form 10-Q for the quarter ended March 31, 2003).

10.1.4     Stock  Pledge  Agreement  dated  February  7, 2003  between  Berkeley
           International  Capital  Limited and the  Governor  and Company of the
           Bank of Scotland,  relating to the Term Loan

                                       88
<PAGE>
           and  Guarantee  Facility dated  December 20, 2002 (filed   previously
           as  Exhibit  10.1.4 to our Form  10-Q for the quarter ended March 31,
           2003).

10.1.5     Stock Pledge Agreement dated February 19, 2003 between Berkeley (USA)
           Holdings  Limited  and  the  Governor  and  Company  of the  Bank  of
           Scotland,  relating  to the Term Loan and  Guarantee  Facility  dated
           December  20, 2002 (filed  previously  as Exhibit  10.1.5 to our Form
           10-Q for the quarter ended March 31, 2003).

10.1.6     Security  Agreement  dated  February  28,  2003  between  us and  the
           Governor  and  Company of the Bank of  Scotland  relating to the Term
           Loan and Guarantee Facility dated December 20, 2002 (filed previously
           as Exhibit  10.1.6 to our Form 10-Q for the  quarter  ended March 31,
           2003).

10.2.1     Settlement  dated  February  16,  1990 among (1) us, (2) John  Gerald
           Patrick  Wheeler and (3) Ian Walter Strang,  constituting  The London
           Pacific Group 1990 Employee  Share Option Trust (filed  previously as
           Exhibit 3.2 to our  Post-Effective  Amendment  No. 2 to  Registration
           Statement on Form 20-F/A dated August 31, 1993).

10.2.2     Executed  Instrument  dated  March 18,  1994  among  (1) John  Gerald
           Patrick Wheeler,  (2) Ian Walter Strang and (3) Richard John Pirouet,
           relating to The London Pacific Group 1990 Employee Share Option Trust
           (filed  previously as Exhibit 3.2.1 to our Annual Report on Form 20-F
           dated June 10, 1994).

10.2.3     Executed  Instrument  dated  September  27, 1994 among (1) Ian Walter
           Strang,  (2)  Richard  John  Pirouet  and (3)  Clive  Aubrey  Charles
           Chaplin,  relating to The London  Pacific Group 1990  Employee  Share
           Option Trust (filed  previously as Exhibit 3.2.2 to our Annual Report
           on Form 20-F dated June 29, 1995).

10.2.4     Executed  Instrument dated March 3, 1995 among (1) Ian Walter Strang,
           (2)  Richard  John  Pirouet  and (3) Clive  Aubrey  Charles  Chaplin,
           relating to The London Pacific Group 1990 Employee Share Option Trust
           (filed  previously as Exhibit 3.2.3 to our Annual Report on Form 20-F
           dated June 29, 1995).

10.2.5     Executed  Instrument  dated  August 22, 1996 among (1)  Richard  John
           Pirouet,  (2) Clive  Aubrey  Charles  Chaplin and (3) Ronald  William
           Green,  relating  to The London  Pacific  Group 1990  Employee  Share
           Option Trust (filed  previously as Exhibit 3.2.4 to our Annual Report
           on Form 20-F dated June 30, 1997).

10.2.6     Executed  Instrument  dated  August 29, 1998 among (1)  Richard  John
           Pirouet,  (2) Clive Aubrey Charles Chaplin,  (3) Ronald William Green
           and (4) Victor Aloysius Hebert,  relating to The London Pacific Group
           1990 Employee  Share Option Trust (filed  previously as Exhibit 3.2.5
           to our Annual Report on Form 20-F dated June 30, 1999).

10.2.7     Executed  Instrument  dated  May 31,  2000  among  (1)  Richard  John
           Pirouet,  (2) Clive Aubrey Charles Chaplin,  (3) Ronald William Green
           and (4) Victor Aloysius Hebert,  relating to The London Pacific Group
           1990 Employee Share Option Trust (filed  previously as Exhibit 10.2.1
           to our Form 10-Q for the quarter ended September 30, 2000).

10.2.8     Executed  Instrument  dated  May 31,  2000  among  (1)  Richard  John
           Pirouet,  (2) Clive Aubrey Charles Chaplin, (3) Ronald William Green,
           (4) Victor Aloysius Hebert and (5) Christopher Byrne, relating to The
           London   Pacific  Group  1990  Employee  Share  Option  Trust  (filed
           previously  as Exhibit  10.2.2 to our Form 10-Q for the quarter ended
           September 30, 2000).

10.3.1(1)  Agreement  dated July 1, 1990  between us and Ian  Kenneth  Whitehead
           (filed  previously  as  Exhibit  10.3.1 to our Form 10-K for the year
           ended December 31, 2000).

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<PAGE>

10.3.2(1)  Berkeley  (USA) Holdings  Limited  Amended and Restated 1993 Deferred
           Compensation  Plan dated  December  16,  1999  (filed  previously  as
           Exhibit  10.3.2  to our Form  10-K for the year  ended  December  31,
           2000).

10.3.3(1)  London Pacific Advisers Limited Retirement Scheme  confirmation dated
           December  5, 2000 for Ian  Kenneth  Whitehead  (filed  previously  as
           Exhibit  10.3.3  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.1     Settlement  dated May 23, 1997 among BG Services Limited and A.L.O.T.
           Trustee Limited  establishing Agent Loyalty  Opportunity Trust (filed
           previously  as  Exhibit  10.4.1 to our Form  10-K for the year  ended
           December 31, 2001).

10.4.2     Executed  Deed  dated  July  16,  1997 by  A.L.O.T.  Trustee  Limited
           relating to Agent  Loyalty  Opportunity  Trust (filed  previously  as
           Exhibit  10.4.2  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.3     Executed  Deed dated  August 13,  1997 by  A.L.O.T.  Trustee  Limited
           relating to Agent  Loyalty  Opportunity  Trust (filed  previously  as
           Exhibit  10.4.3  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.4     Executed  Deed dated  August 20,  1998 by  A.L.O.T.  Trustee  Limited
           relating to Agent  Loyalty  Opportunity  Trust (filed  previously  as
           Exhibit  10.4.4  to our Form  10-K for the year  ended  December  31,
           2001).

10.4.5     Executed Deed of Amendment and  Appointment  dated  December 11, 2001
           among Berkeley  International  Capital  Limited and A.L.O.T.  Trustee
           Limited relating to Agent Loyalty Opportunity Trust (filed previously
           as Exhibit  10.4.5 to our Form 10-K for the year ended  December  31,
           2001).

10.5       Asset Purchase Agreement dated March 7, 2003 between Berkeley Capital
           Management  ("BCM"),  Berkeley  (USA)  Holdings  Limited and Berkeley
           Capital  Management LLC relating to the sale of substantially  all of
           the assets and operations of BCM (filed previously as Exhibit 10.5 to
           our Form 10-Q for the quarter ended March 31, 2003).

10.6       Purchase Agreement,  dated May 9, 2003, for the acquisition of London
           Pacific Advisory Services,  Inc. and London Pacific Securities,  Inc.
           by SunGard Business Systems Inc. (filed previously as Exhibit 10.6 to
           our Form 10-Q for the quarter ended June 30, 2003).

14.1       Code of Ethics.

21         Subsidiaries of the Company as of February 27, 2004.

31.1       Certification  by the  Company's  Executive  Chairman  pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  302 of the
           Sarbanes-Oxley Act of 2002.

31.2       Certification by the Company's Chief Financial Officer pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  302 of the
           Sarbanes-Oxley Act of 2002.

32.1       Certification  by the  Company's  Executive  Chairman  pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  906 of the
           Sarbanes-Oxley Act of 2002.

32.2       Certification by the Company's Chief Financial Officer pursuant to 18
           U.S.C.  Section  1350,  as adopted  pursuant  to  Section  906 of the
           Sarbanes-Oxley Act of 2002.


 ____________

(1) Management  contract or compensatory  arrangement filed in response  to Item
    15(a)(3) of the instructions to Form 10-K.

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