<DOCUMENT>
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<DESCRIPTION>T. ROWE PRICE NEW ASIA FUND
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Item 1. Report to Shareholders
T. Rowe Price New Asia Fund
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Certified Annual Report
This report is certified under the Sarbanes-Oxley Act of 2002, which
requires that public companies, including mutual funds, affirm that the
information provided in their annual and semiannual shareholder reports
fully and fairly represents their financial position.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
Performance Comparison
This chart shows the value of a hypothetical $10,000 investment in the fund
over the past 10 fiscal year periods or since inception (for funds lacking
10-year records). The result is compared with benchmarks, which may include
a broad-based market index and a peer group average or index. Market
indexes do not include expenses, which are deducted from fund returns as
well as mutual fund averages and indexes.
[Graphic Omitted]
NEW ASIA FUND
New Asia Fund $10,029
MSCI All Country Far East Free Ex-Japan Index $8,320
Lipper Pacific Ex-Japan Funds Average $9,371
MSCI AC Far East Lipper Pacific Ex-Japan
Ex-Japan Free Index Funds Average New Asia Fund
10/31/1993 10000 10000 10000
10/31/1994 11546.2 10719.8 10411.2
10/31/1995 10676 9930.04 9401.32
10/31/1996 11731.8 10721.2 10113.6
10/31/1997 7673.42 7890.5 7018.01
10/31/1998 5904.49 6138.9 5897.4
10/31/1999 8978.14 8764.01 8771.36
10/31/2000 7058.7 7931.87 8711.98
10/31/2001 5281.2 6079.68 6252.56
10/31/2002 6081.01 6620.86 6950.01
10/31/2003 8320.08 9371.13 10029.1
Average Annual Compound Total Return
Periods Ended 10/31/03 1 Year 5 Years 10 Years
New Asia Fund 44.30% 11.20% 0.03%
MSCI All Country Far East Free Ex-Japan Index 36.82 7.10 -1.82
Lipper Pacific Ex-Japan Funds Average 37.16 9.71 -1.00
Returns do not reflect taxes that the shareholder may pay on fund
distributions or the redemption of fund shares. Past performance cannot
guarantee future results.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
Dear Shareholder,
We are pleased to report that your fund returned 44.30% during the 12
months ended October 31, 2003, as you can see in the table on the preceding
page. The fund outperformed its peer group, the Lipper Pacific Ex-Japan
Funds Average, and the MSCI All Country Far East Free Ex-Japan Index by
healthy margins. The fund's performance versus its benchmarks was aided by
our large allocation to the strong Indian market, which gained more than
74% for the past 12 months.
As you know, the fund's objective is long-term growth of capital through
investments in large and small companies located, or with primary
operations, in Asia and the Pacific Basin (excluding Japan). Because the
economies of Hong Kong, Singapore, Malaysia, Thailand, and other countries
in the region are in an earlier stage of development than more established
economies, they should offer investors good growth potential over the long
term. However, the fund's relatively limited geographic orientation and
exposure to some emerging markets increase its risk level.
The Major International Index Returns table shows how the world's major
regions performed over the past year. As you can see, international stock
markets posted strong gains that were led by emerging markets. The MSCI
Emerging Markets Free Index, Emerging Europe and Middle East Index, and the
Emerging Markets Free Latin America Index all performed better than the
developed market MSCI EAFE (Europe, Australasia, and Far East) Index and
the S&P 500 Index of large-cap U.S. stocks.
MAJOR INTERNATIONAL INDEX RETURNS
Period Ended 10/31/03 12 Month Return
MSCI Emerging Markets Free Index 48.74%
MSCI Emerging Europe and Middle East Index 52.12
MSCI Emerging Markets Free Latin America Index 59.75
MSCI EAFE Index 27.57
S&P 500 Index 20.80
<PAGE>
The Market Performance table shows how the fund's largest markets performed
over the past year. All of our largest country allocations performed well,
led by India, our fourth-largest allocation. Even Malaysia's market, the
weakest among our top five, gained 29% during the past 12 months.
MARKET PERFORMANCE
(In U.S. Dollar Terms)
Period Ended 10/31/03 12 Months
South Korea 30.50%
Hong Kong 33.78
Taiwan 41.85
India 74.48
Malaysia 29.04
Source: RIMES Online, using MSCI indices.
[Graphic Omitted]
Geographic Diversification
South Korea 26%
Hong Kong 17%
Taiwan 16%
India 16%
Malaysia 8%
Thailand 6%
Singapore 4%
Other and Reserves 7%
Based on net assets of 10/31/03.
The Geographic Diversification pie chart shows the fund's country
allocations at the end of our fiscal year. As you can see, our largest
investments were in South Korea, Hong Kong, Taiwan, and India.
Finally, I'm sure you are aware that mutual fund companies have recently
come under scrutiny for their trading policies. The investigations have led
to allegations that executives of several mutual fund companies permitted
or engaged in improper mutual fund trading. In addition, certain
intermediaries that process fund transactions are alleged to have assisted
some investors in executing improper mutual fund trades. I want T. Rowe
Price shareholders to know that we emphatically condemn the abuses that
have been revealed or alleged against other firms in our industry. Our firm
has not entered and will not enter into any agreements with any investors
or intermediaries that authorize after-hours trading or excessive
short-term trading in any of our funds. T. Rowe Price investors can be
assured that our firm unequivocally opposes illegal or inappropriate
trading of any nature and has policies and procedures in place designed to
<PAGE>
protect the best interests of our long-term shareholders. No T. Rowe Price
executives or portfolio managers or investment personnel of the T. Rowe
Price mutual funds have engaged in any inappropriate trading of T. Rowe
Price mutual funds. You may find out more about our trading policies and
the steps we take to protect your interests by visiting our Web site
(troweprice.com). These policies are also spelled out in your fund's
prospectus.
We thank you for your continued support.
Respectfully,
James S. Riepe
Chairman
November 21, 2003
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
FINANCIAL HIGHLIGHTS For a share outstanding throughout each period
Year
Ended
10/31/03 10/31/02 10/31/01 10/31/00 10/31/99
NET ASSET VALUE
Beginning of period $ 5.68 $ 5.11 $ 7.12 $ 7.20 $ 4.93
Investment activities
Net investment
income (loss) 0.06 0.03 0.03 0.04 0.05
Net realized and
unrealized
gain (loss) 2.44 0.54 (2.04) (0.08)** 2.31
Total from
investment
activities 2.50 0.57 (2.01) (0.04) 2.36
Distributions
Net investment
income (0.04) - - (0.04) (0.09)
NET ASSET VALUE
End of period $ 8.14 $ 5.68 $ 5.11 $ 7.12 $ 7.20
Ratios/Supplemental
Data
Total return^ 44.30% 11.15% (28.23)% (0.68)% 48.73%
Ratio of total
expenses to
average net assets 1.17% 1.17% 1.22% 1.08% 1.21%
Ratio of net
investment income
(loss) to average
net assets 1.06% 0.53% 0.49% 0.41% 0.87%
Portfolio
turnover rate 71.7% 72.0% 49.0% 52.2% 69.9%
Net assets,
end of period
(in millions) $ 826 $ 562 $ 527 $ 875 $ 996
^ Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions.
** The amount presented is calculated pursuant to a methodology prescribed by
the Securities and Exchange Commission for a share outstanding throughout
the period. This amount is inconsistent with the fund's aggregate gains and
losses because of the timing of sales and redemptions of fund shares in
relation to fluctuating market values for the investment portfolio.
The accompanying notes are an integral part of these financial statements.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report October 31, 2003
STATEMENT OF NET ASSETS (ss.) Shares Value
In thousands
BERMUDA 0.4%
Common Stocks 0.4%
Grande Holdings (HKD) 1,766,000 $ 1,864
Grande Holdings, 144A (HKD) 1,084,000 1,145
Total Bermuda (Cost $3,476) 3,009
CAYMAN ISLAND 1.0%
Common Stocks 1.0%
Harbin Brewery Group (HKD) 4,646,000 2,183
tom.com (HKD) * 18,340,000 5,902
Total Cayman Island (Cost $6,864) 8,085
CHINA 1.0%
Common Stocks 1.0%
BYD (HKD) 1,142,500 2,978
China Telecom Limited (HKD) 5,012,000 1,662
Hainan Meilan Airport (HKD) 1,131,000 779
New World Development, 144A (HKD) 4,000,000 2,562
Total China (Cost $6,558) 7,981
HONG KONG 17.1%
Common Stocks 17.1%
Asia Aluminum Holdings 17,648,000 3,499
BOC Hong Kong 4,766,000 8,252
Cathay Pacific Airways 2,719,000 5,198
Cheung Kong Holdings 1,928,000 16,071
China Insurance 4,692,000 3,141
China Mobile (Hong Kong) 5,770,500 16,380
CNOOC 2,419,500 4,563
Dah Sing Financial 225,200 1,573
Esprit Holdings 2,592,001 8,125
Giordano International 9,110,000 4,105
Henderson Land Development 1,157,000 4,855
Hong Kong Exchanges & Clearing 2,610,000 5,678
Hutchison Whampoa 2,431,900 18,784
<PAGE>
Li & Fung 2,660,000 $ 4,469
New World Development 5,492,000 3,517
Next Media * 9,738,000 4,137
PCCW Limited * 5,481,000 3,951
Shun Tak Holdings 5,166,000 1,746
Sun Hung Kai Properties 841,000 7,064
Swire Pacific, Series A 835,000 5,095
Techtronic Industries 598,000 1,647
Television Broadcast 1,220,000 5,780
Varitronix 3,676,000 3,904
Total Hong Kong (Cost $105,289) 141,534
INDIA 16.1%
Common Stocks 16.1%
Arvind Mills * 3,942,000 3,979
Ballarpur Industries * 2,609,338 4,321
Bharti Tele-Ventures * 5,055,284 10,056
Bombay Dyeing 1,604,100 4,456
Gail India 1,307,800 4,725
HDFC Bank 1,899,818 13,320
Hindalco Industries 113,791 2,752
I-Flex Solutions, 144A * 423,100 6,414
Indian Hotels 815,690 6,348
Kotak Mahindra Finance 1,050,000 7,912
Larsen & Toubro 932,100 8,361
Mahindra & Mahindra 2,274,100 17,116
Maruti Udyog * 1,515,500 10,828
Maruti Udyog (Restricted shares) * 400,300 2,860
Moschip Semiconductor * 1,121,126 1,044
State Trading Corp of India 331,899 989
Tata Motors 726,200 6,008
Tata Tea 815,100 4,748
Televison Eighteen India *+ 661,500 2,122
Zee Telefilms 4,903,400 14,812
Total India (Cost $78,279) 133,171
<PAGE>
INDONESIA 0.5%
Common Stocks 0.5%
PT Indocement Tunggal Prakarsa * 12,334,500 $ 2,794
PT Semen Cibinong * 33,413,500 1,416
Total Indonesia (Cost $3,813) 4,210
MALAYSIA 7.5%
Common Stocks 7.5%
Arab Malaysian * 8,850,500 2,865
Berjaya Sports Toto 4,948,200 5,677
Berjaya Sports Toto, Series B * 2,045,250 2,207
CIMB Berhad 4,769,200 5,748
Gamuda Berhad 2,074,000 4,148
Hong Leong Bank 3,987,900 5,719
IJM 2,462,000 3,337
Magnum 9,150,700 6,815
Malayan Banking Berhad 1,611,800 4,326
MK Land Holdings 7,719,100 4,571
Multi-Purpose Holdings * 10,817,900 3,530
Pos Malaysia & Services Holdings 3,362,100 1,469
Road Builder 3,214,000 3,349
SP Setia 6,146,999 5,823
Symphony House Berhad * 4,663,600 2,369
Total Malaysia (Cost $55,330) 61,953
SINGAPORE 4.2%
Common Stocks 4.2%
Ascendas, REIT 3,981,000 2,357
Ascendas, 144A, REIT 5,134,800 3,040
Capitamall Trust 4,662,000 3,430
Creative Technology 404,200 4,205
DBS 489,000 4,019
Elec & Eltek (USD) 1,480,900 4,220
GES International 5,700,000 2,129
<PAGE>
GP Batteries 913,000 $ 2,015
Keppel 2,070,000 7,079
SIA Engineering 2,012,000 2,371
Total Singapore (Cost $27,697) 34,865
SOUTH KOREA 25.5%
Common Stocks 23.0%
Amorepacific 54,220 7,445
CJ Home Shopping 58,070 2,208
Daewoo Shipbuilding & Marine Engineering * 110,900 1,490
Daewoo Shipbuilding & Marine
Engineering GDR (USD) * 51,400 1,347
Daewoo Shipbuilding GDR, 144A (USD) * 148,200 3,883
Hanwha Chemical * 1,039,970 7,223
Kook Soon Dang 185,926 3,456
Kookmin Bank 445,386 16,257
Kookmin Bank ADR (USD) 68,800 2,528
Korean Air Lines 314,600 4,200
Kumgang Korea Chemical 82,990 7,005
LG Ad 157,290 2,638
LG Card 334,670 3,407
LG Chemical 102,120 4,099
LG Home Shopping 74,500 3,632
LG International 633,230 3,847
Lotte Chilsung Beverage 13,480 6,834
Lotte Confectionery 8,660 3,805
NCsoft 67,680 3,603
POSCO 47,430 5,530
Pusan Bank 767,870 4,152
Samsung Electronics 144,532 57,398
Samsung Fire & Marine Insurance 114,600 6,546
Shinhan Financial 485,000 6,967
Shinsegae 27,100 5,438
South Korea Telecom 86,280 15,237
190,175
<PAGE>
Preferred Stocks 2.5%
Hyundai Motor 479,980 $ 7,909
Samsung Electronics 62,390 12,388
20,297
Total South Korea (Cost $123,325) 210,472
TAIWAN 16.1%
Common Stocks 16.1%
Accton Technology 2,333,124 1,451
Acer 5,397,851 7,954
Advantech 2,370,023 3,562
Basso Industry 1,845,000 3,698
Benq GDR, 144A (USD) 707,300 4,562
China Trust Finance Holdings 6,222,516 6,474
Delta Electronics 419,485 536
EVA Airways 6,439,000 2,733
EVA Airways (Bonus shares) 120,851 51
Evergreen Marine 7,005,460 6,153
First Financial Holdings * 7,313,000 4,914
Formosa Plastic 5,138,349 7,875
Fubon Financial Holdings 4,908,000 5,178
Hon Hai Precision Industry 1,794,754 8,040
Merry Electronics 2,440,000 3,955
Nan Ya Plastic 5,176,631 6,911
Phoenixtec Power 3,331,575 3,977
Polaris Securities 5,259,600 2,620
Quanta Computer 1,336,500 3,644
Ritek * 7,357,000 5,182
Taishin Financial Holdings 6,393,000 4,541
Taiwan Cellular 4,359,000 3,918
Taiwan Semiconductor Manufacturing 7,515,073 14,840
United Microelectronics 10,446,280 9,575
Vanguard International Semiconductor * 23,237,000 7,910
Wan Hai Lines 3,228,116 3,159
Total Taiwan (Cost $102,617) 133,413
<PAGE>
THAILAND 6.4%
Common Stocks 6.4%
Bangkok Bank, NVDR * 4,982,000 $ 10,737
Italian-Thai Development * 3,733,600 8,046
Jasmine International * 10,287,500 2,733
Jasmine International, Rights, 12/15/03 * 10,287,500 1,431
Kasikornbank Public, NVDR * 9,721,000 10,292
Land & Houses, NVDR 25,201,300 7,642
Siam Commercial Bank * 8,072,000 8,344
Sino-Thai Engineering & Construction * 8,265,200 3,521
TelecomAsia, Rights, 4/3/08 * 1,597,894 0
Total Thailand (Cost $27,107) 52,746
UNITED KINGDOM 1.2%
Common Stocks 1.2%
Astro All Asia Networks (MYR) * 1,845,000 2,292
HSBC (HKD) 532,434 8,019
Total United Kingdom (Cost $8,082) 10,311
SHORT-TERM INVESTMENTS 2.4%
Money Market Funds 2.4%
T. Rowe Price Reserve Investment Fund,1.10% # 19,618,789 19,619
Total Short-Term Investments (Cost $19,619) 19,619
SECURITIES LENDING COLLATERAL 4.9%
Money Market Pooled Account 4.9%
Investment in money market pooled
account managed by
JP Morgan Chase Bank, London 40,481,850 40,482
Total Securities Lending Collateral
(Cost $40,482) 40,482
<PAGE>
Total Investments in Securities
104.3% of Net Assets (Cost $608,538) $ 861,851
Other Assets Less Liabilities (35,723)
NET ASSETS $ 826,128
Net Assets Consist of:
Undistributed net investment income (loss) $ 6,180
Undistributed net realized gain (loss) (227,537)
Net unrealized gain (loss) 252,442
Paid-in-capital applicable to 101,526,359 shares
of $0.01 par value capital stock outstanding;
2,000,000,000 shares of the Corporation authorized 795,043
NET ASSETS $ 826,128
NET ASSET VALUE PER SHARE $ 8.14
(ss.) Denominated in currency of the country of incorporation unless
otherwise noted
# Seven-day yield
* Non-income producing
+ Affiliated company - See Note 2.
144A Security was purchased pursuant to Rule 144A under the Securities Act
of 1933 and may be resold in transactions exempt from registration only
to qualified institutional buyers -- total of such securities at
period-end amounts to $21,606,000 and represents 2.6% of net assets
ADR American Depository Receipts
GDR Global Depository Receipts
HKD Hong Kong dollar
MYR Malaysian ringgit
NVDR Non Voting Depository Receipt
REIT Real Estate Investment Trust
USD United States dollar
The accompanying notes are an integral part of these financial statements.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
Statement of Operations
In thousands
Year
Ended
10/31/03
Investment Income (Loss)
Income
Dividend (net of foreign taxes of $1,999) $ 12,806
Securities lending 594
Other income 102
Interest (net of foreign taxes of $4) 17
Total income 13,519
Expenses
Investment management 4,974
Shareholder servicing 1,660
Custody and accounting 297
Prospectus and shareholder reports 83
Legal and audit 46
Registration 30
Directors 9
Miscellaneous 7
Total expenses 7,106
Net investment income (loss) 6,413
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities (including foreign tax refunds of $81) 37,335
Foreign currency transactions (627)
Net realized gain (loss) 36,708
Change in net unrealized gain (loss)
Securities (net of increase in deferred foreign taxes of $865) 203,720
Other assets and liabilities
denominated in foreign currencies (45)
Change in net unrealized gain (loss) 203,675
Net realized and unrealized gain (loss) 240,383
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 246,796
The accompanying notes are an integral part of these financial statements.
<PAGE>
T. Rowe Price New Asia Fund
--------------------------------------------------------------------------------
Certified Annual Report
STATEMENT OF CHANGES IN NET ASSETS
In thousands
Year
Ended
10/31/03 10/31/02
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $ 6,413 $ 3,464
Net realized gain (loss) 36,708 (41,559)
Change in net unrealized gain (loss) 203,675 106,145
Increase (decrease) in net assets from operations 246,796 68,050
Distributions to shareholders
Net investment income (3,896) -
Capital share transactions *
Shares sold 690,304 1,124,302
Distributions reinvested 3,715 -
Shares redeemed (672,776) (1,157,585)
Increase (decrease) in net assets from capital
share transactions 21,243 (33,283)
Net Assets
Increase (decrease) during period 264,143 34,767
Beginning of period 561,985 527,218
End of period $ 826,128 $ 561,985
*Share information
Shares sold 116,376 178,727
Distributions reinvested 643 -
Shares redeemed (114,487) (182,987)
Increase (decrease) in shares outstanding 2,532 (4,260)
The accompanying notes are an integral part of these financial statements.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report October 31, 2003
NOTES TO FINANCIAL STATEMENTS
Note 1 - Significant Accounting Policies
T. Rowe Price International Funds, Inc. (the corporation) is registered
under the Investment Company Act of 1940 (the 1940 Act). The T. Rowe Price
New Asia Fund (the fund), a nondiversified, open-end management investment
company, is one portfolio established by the corporation and commenced
operations on September 28, 1990. The fund seeks long-term growth of
capital through investments in companies located (or with primary
operations) in Asia (excluding Japan).
The accompanying financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America,
which require the use of estimates made by fund management.
Valuation
The fund values its investments and computes its net asset value per share
at the close of the New York Stock Exchange (NYSE), normally 4 p.m. ET,
each day that the NYSE is open for business. Equity securities listed or
regularly traded on a securities exchange or in the over-the-counter market
are valued at the last quoted sale price, or official closing price for
certain markets, at the time the valuations are made. A security that is
listed or traded on more than one exchange is valued at the quotation on
the exchange determined to be the primary market for such security. Listed
securities not traded on a particular day are valued at the mean of the
latest bid and ask prices for domestic securities and the last quoted sale
price for international securities.
Investments in mutual funds are valued at the mutual fund's closing net
asset value per share on the day of valuation.
Other investments and those for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair
value as determined in good faith by the T. Rowe Price Valuation Committee,
established by the fund's Board of Directors.
Most foreign markets close before the NYSE. Normally, developments that
could affect the values of securities that occur between the close of a
foreign market and the close of the NYSE will not be reflected in security
valuations used by the fund to compute its share price. However, if
developments are so significant that they will, in the judgment of the
fund, clearly and materially affect security values, such valuations may be
adjusted to reflect the estimated fair value of the securities as of the
close of the NYSE, as determined in good faith by the T. Rowe Price
Valuation Committee, established by the fund's Board of Directors.
<PAGE>
Currency Translation
Assets, including investments, and liabilities denominated in foreign
currencies are translated into U.S. dollar values each day at the
prevailing exchange rate, using the mean of the bid and ask prices of such
currencies against U.S. dollars as quoted by a major bank. Purchases and
sales of securities, income, and expenses are translated into U.S. dollars
at the prevailing exchange rate on the date of the transaction. The effect
of changes in foreign currency exchange rates on realized and unrealized
security gains and losses is reflected as a component of security gains and
losses.
Expenses Paid Indirectly
Credits earned on temporarily uninvested cash balances at the custodian are
used to reduce the fund's custody charges.
Other
Income and expenses are recorded on the accrual basis. Investment
transactions are accounted for on the trade date. Realized gains and losses
are reported on the identified cost basis. Dividend income and
distributions to shareholders are recorded by the fund on the ex-dividend
date. Dividends from mutual fund investments are reflected as dividend
income; capital gain distributions from mutual fund investments are
reflected as realized gain/loss. In the normal course of business, the fund
enters into contracts that provide general indemnifications. The fund's
maximum exposure under these arrangements is dependent on claims that may
be made against the fund in the future and, therefore, cannot be estimated;
however, based on experience, the risk of material loss from such claims is
considered remote.
Note 2 - Investment Transactions
Consistent with its investment objective, the fund engages in the following
practices to manage exposure to certain risks or enhance performance. The
investment objective, policies, program, and risk factors of the fund are
described more fully in the fund's prospectus and Statement of Additional
Information.
Emerging Markets
At October 31, 2003, approximately 97% of the fund's net assets were
invested in securities of companies located in emerging markets or
denominated in currencies of emerging market countries. Future economic or
political developments could adversely affect the liquidity or value, or
both, of such securities.
<PAGE>
Securities Lending
The fund lends its securities to approved brokers to earn additional
income. It receives as collateral cash and U.S. government securities
valued at 102% to 105% of the value of the securities on loan. Cash
collateral is invested in a money market pooled account managed by the
fund's lending agent in accordance with investment guidelines approved by
fund management. Collateral is maintained over the life of the loan in an
amount not less than the value of loaned securities, as determined at the
close of fund business each day; any additional collateral required due to
changes in security values is delivered to the fund the next business day.
Although risk is mitigated by the collateral, the fund could experience a
delay in recovering its securities and a possible loss of income or value
if the borrower fails to return the securities. Securities lending revenue
recognized by the fund consists of earnings on invested collateral and
borrowing fees, net of any rebates to the borrower and compensation to the
lending agent. At October 31, 2003, the value of loaned securities was
$40,135,000; aggregate collateral consisted of $40,482,000 in the money
market pooled account and U.S. government securities valued at $2,852,000.
Affiliated Companies
The fund may invest in certain securities that are considered affiliated
companies. As defined by the 1940 Act, an affiliated company is one in
which the fund owns 5% or more of the outstanding voting securities. At
October 31, 2003, the value of affiliated companies totaled $2,122,000,
representing 0.3% of the value of the fund's investments in securities.
Other
Purchases and sales of portfolio securities, other than short-term
securities, aggregated $436,687,000 and $418,490,000, respectively, for the
year ended October 31, 2003.
Note 3 - Federal Income Taxes
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company under Subchapter M of
the Internal Revenue Code and distribute to shareholders all of its taxable
income and gains. Federal income tax regulations differ from generally
accepted accounting principles; therefore, distributions determined in
accordance with tax regulations may differ significantly in amount or
character from net investment income and realized gains for financial
reporting purposes. Financial reporting records are adjusted for permanent
book/tax differences to reflect tax character. Financial records are not
adjusted for temporary differences.
<PAGE>
Distributions during the year ended October 31, 2003 totaled $3,896,000 and
were characterized as ordinary income for tax purposes. At October 31,
2003, the tax-basis components of net assets were as follows:
Unrealized appreciation $ 264,386,000
Unrealized depreciation (13,344,000)
Net unrealized appreciation (depreciation) 251,042,000
Undistributed ordinary income 7,057,000
Capital loss carryforwards (227,014,000)
Paid-in capital 795,043,000
Net assets $ 826,128,000
Federal income tax regulations require the fund to treat the gain/loss on
passive foreign investment companies as realized on the last day of the tax
year; accordingly, $1,400,000 of unrealized losses reflected in the
accompanying financial statements were realized for tax purposes as of
October 31, 2003. The fund intends to retain realized gains to the extent
of available capital loss carryforwards for federal income tax purposes. In
2003, the fund utilized $36,951,000 of capital loss carryforwards. As of
October 31, 2003, the fund had $148,017,000 of capital loss carryforwards
that expire in 2006, $38,195,000 that expire in 2009, and $40,802,000 that
expire in 2010.
For the year ended October 31, 2003, the fund recorded the following
permanent reclassifications to reflect tax character. Results of operations
and net assets were not affected by these reclassifications.
Undistributed net investment income $ 81,000
Undistributed net realized gain (81,000)
At October 31, 2003, the cost of investments for federal income tax
purposes was $609,938,000.
<PAGE>
Note 4 - Foreign Taxes
The fund is subject to foreign income taxes imposed by certain countries in
which it invests. Foreign income taxes are accrued by the fund as a
reduction of income.
Gains realized upon disposition of Indian securities held by the fund are
subject to capital gains tax in India, payable prior to repatriation of
sale proceeds. The tax is computed on net realized gains, and realized
losses in excess of gains may be carried forward eight years to offset
future gains. In addition, the fund accrues a deferred tax liability for
net unrealized gains on Indian securities. At October 31, 2003, the fund
had a deferred tax liability of $865,000, and $2,243,000 of capital loss
carryforwards that expire in 2010, and $8,777,000 that expire in 2011.
Note 5- Related Party Transactions
The fund is managed by T. Rowe Price International, Inc. (the manager), a
wholly owned subsidiary of T. Rowe Price Associates, Inc. (Price
Associates), which is wholly owned by T. Rowe Price Group, Inc. The
investment management agreement between the fund and the manager provides
for an annual investment management fee, which is computed daily and paid
monthly. The fee consists of an individual fund fee, equal to 0.50% of the
fund's average daily net assets, and the fund's pro-rata share of a group
fee. The group fee is calculated based on the combined net assets of
certain mutual funds sponsored by Price Associates (the group) applied to a
graduated fee schedule, with rates ranging from 0.48% for the first $1
billion of assets to 0.295% for assets in excess of $120 billion. The
fund's portion of the group fee is determined by the ratio of its average
daily net assets to those of the group. At October 31, 2003, the effective
annual group fee rate was 0.32%, and investment management fee payable
totaled $551,000.
In addition, the fund has entered into service agreements with Price
Associates and two wholly owned subsidiaries of Price Associates
(collectively, Price). Price Associates computes the daily share price and
maintains the financial records of the fund. T. Rowe Price Services, Inc.,
provides shareholder and administrative services in its capacity as the
fund's transfer and dividend disbursing agent. T. Rowe Price Retirement
Plan Services, Inc., provides subaccounting and recordkeeping services for
certain retirement accounts invested in the fund. Expenses incurred
pursuant to these service agreements totaled $1,253,000 for the year ended
October 31, 2003, of which $110,000 was payable at period-end.
<PAGE>
The fund is also one of several mutual funds sponsored by Price Associates
(underlying Price funds) in which the T. Rowe Price Spectrum Funds
(Spectrum Funds) may invest. The Spectrum Funds do not invest in the
underlying Price funds for the purpose of exercising management or control.
Pursuant to a special servicing agreement, expenses associated with the
operation of the Spectrum Funds are borne by each underlying Price fund to
the extent of estimated savings to it and in proportion to the average
daily value of its shares owned by the Spectrum Funds. Expenses allocated
under this agreement are reflected as shareholder servicing expense in the
accompanying financial statements. For the year ended October 31, 2003, the
fund was allocated $12,000 of Spectrum Funds' expenses, of which $2,000
related to services provided by Price and $1,000 was payable at period-end.
At October 31, 2003, approximately 0.4% of the outstanding shares of the
fund were held by the Spectrum Funds.
The fund may invest in the T. Rowe Price Reserve Investment Fund and the T.
Rowe Price Government Reserve Investment Fund (collectively, the Reserve
Funds), open-end management investment companies managed by Price
Associates. The Reserve Funds are offered as cash management options only
to mutual funds, trusts, and other accounts managed by Price Associates
and/or its affiliates, and are not available to the public. The Reserve
Funds pay no investment management fees. During the year ended October 31,
2003, dividend income from the Reserve Funds totaled $194,000.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors of T. Rowe Price International Funds, Inc. and
Shareholders of T. Rowe Price New Asia Fund
In our opinion, the accompanying statement of net assets and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position
of T. Rowe Price New Asia Fund (one of the portfolios comprising T. Rowe
Price International Funds, Inc., hereafter referred to as the "Fund") at
October 31, 2003, and the results of its operations, the changes in its net
assets and the financial highlights for each of the fiscal periods
presented, in conformity with accounting principles generally accepted in
the United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted
our audits of these financial 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 audits, which included confirmation of securities at October 31, 2003
by correspondence with the custodian, provide a reasonable basis for our
opinion.
PricewaterhouseCoopers LLP
Baltimore, Maryland
November 24, 2003
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
TAX INFORMATION (UNAUDITED) FOR THE TAX YEAR ENDED 10/31/03
We are providing this information as required by the Internal Revenue Code.
The amounts shown may differ from those elsewhere in this report because of
differences between tax and financial reporting requirements.
For taxable non-corporate shareholders, $5,019,000 of the fund's
distributed income and short-term capital gains represents qualified
dividend income subject to the 15% rate category.
The fund will pass through foreign source income of $8,967,000 and foreign
taxes paid of $1,908,000.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
ABOUT THE FUND'S DIRECTORS AND OFFICERS
Your fund is governed by a Board of Directors that meets regularly to
review investments, performance, expenses, and other business matters, and
is responsible for protecting the interests of shareholders. The majority
of the fund's directors are independent of T. Rowe Price Associates, Inc.
(T. Rowe Price); "inside" directors are officers of T. Rowe Price. The
Board of Directors elects the fund's officers, who are listed in the final
table. The business address of each director and officer is 100 East Pratt
Street, Baltimore, MD 21202. The Statement of Additional Information
includes additional information about the fund directors and is available
without charge by calling a T. Rowe Price representative at 1-800-225-5132.
Independent Directors
Name
(Date of Birth) Principal Occupation(s) During Past 5 Years
Year Elected* and Directorships of Other Public Companies
Anthony W. Deering Director, Chairman of the Board, President, and Chief
(1/28/45) Executive Officer, The Rouse Company, real estate
1991 developers; Director, Mercantile Bank (4/03 to present)
Donald W. Dick, Jr. Principal, EuroCapital Advisors, LLC, an
(1/27/43) acquisition and management advisory firm
1988
David K. Fagin Director, Golden Star Resources Ltd., Canyon
(4/9/38) Resources Corp. (5/00 to present), and Pacific Rim
2001 Mining Corp. (2/02 to present); Chairman and
President, Nye Corp.
F. Pierce Linaweaver President, F. Pierce Linaweaver & Associates,
(8/22/34) Inc., consulting environmental and civil engineers
2001
John G. Schreiber Owner/President, Centaur Capital Partners, Inc.,
(10/21/46) a real estate investment company; Senior Advisor and
2001 Partner, Blackstone Real Estate Advisors, L.P.;
Director, AMLI Residential Properties Trust,
Host Marriott Corp., and The Rouse Company
Hubert D. Vos Owner/President, Stonington Capital Corp., a
(8/2/33) private investment company
2001
Paul M. Wythes Founding Partner, Sutter Hill Ventures, a venture
(6/23/33) capital limited partnership, providing equity capital
1996 to young high-technology companies throughout the
United States; Director, Teltone Corp.
* Each independent director oversees 106 T. Rowe Price portfolios and serves
until retirement, resignation, or election of a successor.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
Inside Directors
Name
(Date of Birth)
Year Elected*
[Number of T.Rowe Price Principal Occupation(s) During Past 5 Years and
Portfolios Overseen] Directorships of Other Public Companies
James S. Riepe Director and Vice President, T. Rowe Price; Vice
(6/25/43) Chairman of the Board, Director, and Vice President,
2002 T. Rowe Price Group, Inc.; Chairman of the Board and
[106] Director, T. Rowe Price Global Asset Management
Limited, T. Rowe Price Global Investment Services
Limited, T. Rowe Price Investment Services, Inc., T.
Rowe Price Retirement Plan Services, Inc., and T. Rowe
Price Services, Inc.; Chairman of the Board, Director,
President, and Trust Officer, T. Rowe Price Trust
Company; Director, T. Rowe Price International, Inc.;
Chairman of the Board, International Funds
M. David Testa Chief Investment Officer, Director, and Vice President,
(4/22/44) T. Rowe Price; Vice Chairman of the Board, Chief
1979 Investment Officer, Director, and Vice President,
[106] T. Rowe Price Group, Inc.; Director, T. Rowe Price
Global Asset Management Limited and T. Rowe Price
Global Investment Services Limited; Chairman of the
Board and Director, T. Rowe Price International, Inc.;
Director and Vice President, T. Rowe Price Trust
Company; Vice President, International Funds
* Each inside director serves until retirement, resignation, or election of a
successor.
Officers
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
Christopher D. Alderson (3/29/62) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
International, Inc.
Mark C.J. Bickford-Smith (4/30/62) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Stephen V. Booth (6/21/61) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
Trust Company
Brian J. Brennan, CFA (7/14/64) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
Trust Company
Joseph A. Carrier (12/30/60) Vice President, T. Rowe Price, T. Rowe
Treasurer, International Funds Price Group, Inc., and T. Rowe Price
Investment Services, Inc.
Unless otherwise noted, officers have been employees of T. Rowe Price or T.
Rowe Price International for at least five years.
<PAGE>
T. Rowe Price New Asia Fund
--------------------------------------------------------------------------------
Certified Annual Report
Officers (continued)
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
Michael J. Conelius, CFA (6/16/64) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
International, Inc.
Ann B. Cranmer (3/23/47) Vice President, T. Rowe Price Group,
Assistant Vice President, Inc.,and T. Rowe Price International,
International Funds Inc.; Vice President and Secretary,
T. Rowe Price Global Asset Management
Limited and T. Rowe Price Global
Investment Services Limited
Julio A. Delgado, CFA (5/13/65) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Frances Dydasco (5/8/66) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Mark J.T. Edwards (10/27/57) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Roger L. Fiery III, CPA (2/10/59) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., T. Rowe Price
International, Inc., and T. Rowe
Price Trust Company
John R. Ford, CFA (11/25/57) Vice President, T. Rowe Price and
President, International Funds T. Rowe Price Group, Inc.; Chief
Investment Officer, Director, and
Vice President, T. Rowe Price
International, Inc.
Gregory S. Golczewski (1/15/66) Vice President, T. Rowe Price and
Vice President, International Funds T. Rowe Price Trust Company
M. Campbell Gunn (3/9/56) Vice President, T. Rowe Price Global
Vice President, International Funds Investment Services Limited, T. Rowe
Price Group, Inc., and T. Rowe Price
International, Inc.
Henry H. Hopkins (12/23/42) Director and Vice President, T. Rowe
Vice President, International Funds Price Group, Inc., T. Rowe Price
Investment Services, Inc., T. Rowe
Price Services, Inc., and T. Rowe Price
Trust Company; Vice President, T. Rowe
Price, T. Rowe Price International,
Inc., and T. Rowe Price Retirement
Plan Services, Inc.
Ian D. Kelson (8/16/56) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
International, Inc.; formerly Head of
Fixed Income, Morgan Grenfell/Deutsche
Asset Management (to 2000)
Unless otherwise noted, officers have been employees of T. Rowe Price or T.
Rowe Price International for at least five years.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
Officers (continued)
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
Patricia B. Lippert (1/12/53) Assistant Vice President, T. Rowe Price
Secretary, International Funds and T. Rowe Price Investment Services,
Inc.
Raymond A. Mills, Ph.D., CFA (12/3/60) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
International, Inc.
George A. Murnaghan (5/1/56) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., T. Rowe Price
International, Inc., T. Rowe Price
Investment Services, Inc., and
T. Rowe Price Trust Company
Gonzalo Pangaro, CFA (11/27/68) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
D. James Prey III (11/26/59) Vice President, T. Rowe Price
Vice President, International Funds and T. Rowe Price Group, Inc.
Robert A. Revel-Chion (3/9/65) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Christopher J. Rothery (5/26/63) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
James B.M. Seddon (6/17/64) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Robert W. Smith (4/11/61) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
International, Inc.
Benedict R.F. Thomas, CFA (8/27/64) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.
Justin Thomson (1/14/68) Vice President, T. Rowe Price Group,
Vice President, International Funds Inc., and T. Rowe Price International,
Inc.; formerly Portfolio Manager, G.T.
Capital/Invesco (to 1998)
Julie L. Waples (6/12/70) Vice President, T. Rowe Price
Vice President, International Funds
David J.L. Warren (4/14/57) Vice President, T. Rowe Price and
Executive Vice President, T. Rowe Price Group, Inc.; Chief
International Funds Executive Officer, Director, and
President, T. Rowe Price International,
Inc.; Director, T. Rowe Price Global
Asset Management Limited and T. Rowe
Price Global Investment Services Limited
Unless otherwise noted, officers have been employees of T. Rowe Price or T.
Rowe Price International for at least five years.
<PAGE>
T. Rowe Price New Asia Fund
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Certified Annual Report
Officers (continued)
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
William F. Wendler II, CFA (3/14/62) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
International, Inc.
Richard T. Whitney, CFA (5/7/58) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., T. Rowe Price
International, Inc., and T. Rowe Price
Trust Company
Edward A. Wiese, CFA (4/12/59) Vice President, T. Rowe Price, T. Rowe
Vice President, International Funds Price Group, Inc., and T. Rowe Price
Trust Company; Chief Investment Officer,
Director, and Vice President, T. Rowe
Price Savings Bank
Unless otherwise noted, officers have been employees of T. Rowe Price or T.
Rowe Price International for at least five years.
Item 2. Code of Ethics.
As of the end of the period covered by this report, the registrant had adopted a
code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions. A copy of this code of
ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were
approved or waivers were granted to this code of ethics during the period
covered by this report.
Item 3. Audit Committee Financial Expert.
The registrant's Board of Directors/Trustees has determined that Mr. David K.
Fagin qualifies as an audit committee financial expert, as defined in Item 3 of
Form N-CSR. Mr. Fagin is considered independent for purposes of Item 3 of Form
N-CSR.
Item 4. Principal Accountant Fees and Services.
Not required at this time.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. [Reserved]
Item 9. Controls and Procedures
(a) The registrant's principal executive officer and principal financial officer
have evaluated the registrant's disclosure controls and procedures within 90
days of this filing and have concluded that the registrant's disclosure controls
and procedures were effective, as of that date, in ensuring that information
required to be disclosed by the registrant in this Form N-CSR was recorded,
processed, summarized, and reported timely.
(b) The registrant's principal executive officer and principal financial officer
are aware of no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 10. Exhibits.
(a)(1) The registrant's code of ethics pursuant to Item 2 of Form N-CSR is
attached.
(a)(2) Separate certifications by the registrant's principal executive officer
and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of
1940, are attached.
(b) A certification by the registrant's principal executive officer and
principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940,
is attached.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
T. Rowe Price International Funds, Inc.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date December 19, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date December 19, 2003
By /s/ Joseph A. Carrier
Joseph A. Carrier
Principal Financial Officer
Date December 19, 2003
</TEXT>
</DOCUMENT>