10. Internal Control

The Board of Directors has delegated to the audit committee to ensure
that all financial reports are prepared under standard of accounting
consistent with the business and are in compliance with all
announcements of the SET and pertinent legal framework. The audit
committee also ensures that unquestioned ethics and good corporate
governance are observed. The committee is additionally charged with
risks management and sound internal control and the selection of the
external auditor. The Board of Directors may delegate other
responsibility to the audit committee from time to time.

In 2005 the audit committee was of the opinion that the company followed
the accounting standard of the Institute of Certified Accountants and
Auditors of Thailand and announcements of the SET in its reports of the
quarterly and annual financial statements for the company alone and in
the consolidated statements with subsidiaries. Good corporate governance
was practiced and a sound internal control process commensurate with the
business was evident. No weaknesses were discovered which is in line
with the external auditor’s opinion.

Report of the Audit Committee

The audit committee duly performed the assignment delegated to it by the
Board of Directors of Pico Thailand Public Co. Ltd. This covers all the
duties as outlined in the rules governing the scope of work of the
committee including, specifically, the adherence to good governance and
observation of the highest ethics in the conduct of business. Our
summary of work done is as follows:

1)  Supervision to ensure that good corporate governance practice is
    adopted.

This was done according to the principles of good governance.

2)  Supervision and review of the quarterly and annual financial
    statements in 2005 for the company and the consolidated statements.

  The preparation of the above reports and statements were done in
  accordance with the Generally Accepted Accounting Principles and the
  announcements of the Securities Exchange Commission and the Stock
  Exchange of Thailand with adequate, accurate and timely disclosure of
  financial information.

3)  Intercompany transactions

  The transactions in this category, which may be interpreted as
  conflicts of interest, were carefully reviewed and found to be
  consistent with normal trade transactions which is the policy observed
  by the company.

4)  Internal audit process

  An internal auditor was appointed in 2005. This was to assist the
  audit committee, management and the Board of directors to accurately
  and timely review the company’s performance leading to sound financial
  reports, effective performance review and business direction
  adjustment if necessary. The internal auditor reports directly to the
  audit committee.

5)  Supervision of risks management.

  Management was cognizant of risks associated with its operation and
  its management of these risks are deemed sound and satisfactory. A
  quarterly review on risks and the potential adverse effects on the
  company’s performance were routinely carried out with recommendations
  addressing the specific risk issues. No substantive risk areas that
  may adversely affect operation were found.

6)  Internal control evaluation.

  The internal control procedures were modified to permit rapid
  adjustments to the requirements of the changing market without
  compromising control. The internal audit report is consistent with the
  external auditor’s opinion stated in the quarterly and annual report
  that no material problems or deficiencies were found. Management has
  implemented an ongoing problem recognition and a responsive and
  objective resolution process to ensure of a smooth and effective
  overall performance.

  On behalf of the Audit Committee

  (Signed) -Signature-

  (Dr. Chaiyod Bunyagidj)

  Chairman of the Audit Committee

  Pico (Thailand) Public Co., Ltd.