EX-99 3 exh.txt EX-99.77Q1(A) Accountants Report on Internal Control [Ernst & Young logo] Ernst & Young LLP 200 Clarendon Street Boston, MA 02116-5072 REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS Board of Trustees of Liberty Funds Trust II In planning and performing our audit of the financial statements of the A (the "Funds"), each a series of Liberty Funds Trust II (the "Trust"), for the year ended August 31, 2001, we considered each Fund's internal control, including control activities for safeguarding securities, to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and to comply with the requirements of Form N-SAR, not to provide assurance on internal control. The management of the Trust is responsible for establishing and maintaining internal control. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control. Generally, internal controls that are relevant to an audit pertain to the Trust's objective of preparing financial statements for external purposes that are fairly presented in conformity with generally accepted accounting principles. Those internal controls include the safeguarding of assets against unauthorized acquisition, use, or disposition. Because of inherent limitations in any internal control, misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of internal control to future periods are subject to the risk that internal control may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our consideration of internal control would not necessarily disclose all matters in internal control that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. However, we noted no matters involving internal control, including control activities for safeguarding securities, and its operation that we consider to be material weaknesses as defined above as of August 31, 2001. This report is intended solely for the information and use by management, the Board of Trustees of the Trust and the Securities and Exchange Commission and is not intended to be and should not be used by anyone other than these specified parties. [GRAPHIC OMITTED] Boston, Massachusetts October 12, 2001 A Liberty Newport Japan Opportunities Fund and Liberty Newport Greater China Fund EX-99.77Q1(B) Accountants Report on Internal Control [PricewaterhouseCoopers logo] PricewaterhouseCoopers LLP 160 Federal Street Boston, MA 02110-9862 To the Shareholders and Trustees of Liberty Funds Trust II In planning and performing our audit of the financial statements of Liberty Intermediate Government Fund (the "Fund") (a series of Liberty Funds Trust II) for the year ended August 31, 2001, we considered its internal control, including control activities for safeguarding securities, in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and to comply with the requirements of Form N-SAR, and not to provide assurance on internal control. The management of the Fund is responsible for establishing and maintaining internal control. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of controls. Generally, controls that are relevant to an audit pertain to the entity's objective of preparing financial statements for external purposes that are fairly presented in conformity with generally accepted accounting principles. Those controls include the safeguarding of assets against unauthorized acquisition, use or disposition. Because of inherent limitations in internal control, errors or fraud may occur and not be detected. Also, projection of any evaluation of internal control to future periods is subject to the risk that it may become inadequate because of changes in conditions or that the effectiveness of the design and operation may deteriorate. Our consideration of internal control would not necessarily disclose all matters in internal control that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. However, we noted no matters involving internal control and its operation, including controls for safeguarding securities, that we consider to be material weaknesses as defined above as of August 31, 2001. This report is intended solely for the information and use of management and the Trustees of Liberty Funds Trust II and the Securities and Exchange Commission and is not intended to be and should not be used by anyone other than these specified parties. PricewaterhouseCoopers LLP Boston, MA October 15, 2001 (Amended By-Laws incorporated herein by reference to Accession number 0000021847-01-500131)