-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, J0ufnQeTX36+WRdBKzhWhWZSMcU6wpGmpJUHuOYpIOU76Gcpf4T5irn4POEx9Wlu RCrl097Al4QwzynIXg3Vmw== 0001047469-05-005650.txt : 20050308 0001047469-05-005650.hdr.sgml : 20050308 20050308142214 ACCESSION NUMBER: 0001047469-05-005650 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20041231 FILED AS OF DATE: 20050308 DATE AS OF CHANGE: 20050308 EFFECTIVENESS DATE: 20050308 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INDONESIA FUND INC CENTRAL INDEX KEY: 0000859120 IRS NUMBER: 133558141 STATE OF INCORPORATION: MD FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-06024 FILM NUMBER: 05666383 BUSINESS ADDRESS: STREET 1: C/O CREDIT SUISSE ASSET MGMT, LLC STREET 2: 466 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2128753500 MAIL ADDRESS: STREET 1: CREDIT SUISSE ASSET MGMT, LLC STREET 2: 466 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 N-CSR 1 a2152734zn-csr.txt N-CSR UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act File No. 811-06024 ----------------------------------------------------- THE INDONESIA FUND, INC. ----------------------------------------------------- (Exact Name of Registrant as Specified in Charter) 466 Lexington Avenue, New York, New York 10017-3140 ----------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) J. Kevin Gao, Esq. The Indonesia Fund, Inc. 466 Lexington Avenue New York, New York 10017-3140 Registrant's telephone number, including area code: (212) 875-3500 Date of fiscal year end: December 31 Date of reporting period: January 1, 2004 to December 31, 2004 ITEM 1. REPORTS TO STOCKHOLDERS. THE INDONESIA FUND, INC. ANNUAL REPORT DECEMBER 31, 2004 [AMERICAN STOCK EXCHANGE(R) LISTED IF (TM) LOGO] 3913-AR-04 CONTENTS Letter to Shareholders 1 Portfolio Summary 3 Schedule of Investments 4 Statement of Assets and Liabilities 6 Statement of Operations 7 Statement of Changes in Net Assets 8 Financial Highlights 10 Notes to Financial Statements 12 Report of Independent Registered Public Accounting Firm 16 Results of Annual Meeting of Shareholders 17 Tax Information 17 Description of InvestLink(SM) Program 18 Information Concerning Directors and Officers 21 Proxy Policy and Portfolio Holdings Information 23
LETTER TO SHAREHOLDERS February 2, 2005 DEAR SHAREHOLDER: For the year ended December 31, 2004 The Indonesia Fund, Inc. (the "Fund") had a gain in its net asset value ("NAV") of 32.1%, vs. an increase of 50.6% for the Morgan Stanley Capital International Indonesia Index.* Based on market price, the Fund's shares rose 6.7% during the year. As a result, the Fund's discount to its NAV stood at 0.20% on December 31, 2004, compared with a premium of 23.53% at the beginning of the year. Over the year the Fund's average premium to NAV was 0.19%. The Fund's underperformance against a narrowly defined benchmark (where the top 10 stocks make up more than 80% of the index) was due in part to diversification efforts; we were underweighted in certain of these stocks that outperformed. The Fund had positive, yet lagging, returns from its banks, materials, food and diversified financial stocks. Stocks that contributed to the Fund's absolute and relative performance included its capital goods, utilities and real estate holdings. THE MARKET: INDONESIA CATCHES UP, PULLS AHEAD The global environment was broadly favorable for emerging markets. Ample liquidity conditions as a result of low global interest rates, robust global growth and investor appetite for higher-return and higher-risk assets drove outperformance versus developed markets for the year as a whole, notwithstanding a mid-period downturn. Indonesia had strong performance for the year in both absolute and relative terms. The market moved mostly sideways through August, but then surged on optimism over its economy and political environment. The bulk of the gains came in the year's fourth quarter, when investors responded enthusiastically to strong economic data--including an improved trade surplus--and good third quarter earnings results, especially among banks and telecommunications companies. On the political front, Susilo Bambang Yudhoyono had a solid win in Indonesia's first direct Presidential election, which concluded in September. Economically, the consumer supported demand for cars and homes amid a rush by newly capitalized banks to extend consumer loans. Paradoxically, Indonesia's trade surplus could have been larger if not for the spike in oil prices: The government's fuel subsidies (along with a lack of investment in the down-stream oil industries) countered the benefits of being Asia's largest oil producer. The politically sensitive issue of fuel subsidies, avoided by previous governments, was given more publicity under the new administration. The government announced (before the tsunami) plans to reduce fuel subsidies, except for kerosene, which is widely used by the poorer population. Price increases can be expected for gasoline and liquefied petroleum gas if the plans proceed. Since these subsidies cost the government more than it spends on development, it may have to choose between adhering to long-term policy goals or increasing its short-term popularity. OUTLOOK AND STRATEGY: ROOM FOR CONTINUED GROWTH? Within the portfolio, our emphasis during the year was on banks, which we added to as a proxy on the Indonesian economy, along with telecommunications and consumer staples companies, most specifically tobacco companies. Late in the year we pared our exposure to non-Indonesian stocks in favor of Indonesian companies, reflecting our more favorable view of economic and political trends in the country. In the wake of the market's outperformance, valuations on Indonesian stocks have become relatively lofty, standing near the high end of the market's historical range. However, we believe that several factors could support the market in 2005, 1 including an accommodative monetary policy, a buoyant commodity backdrop (Indonesia is rich in natural resources), relative political stability and the prospects for investment-led growth stemming from an ambitious program of infrastructure projects. The tragedy and loss from the December 26 disaster is incalculable. For the people of Indonesia, and especially the hard hit province of Aceh, where the army has battled separatist movements for years, this event has united warring factions in an outpouring of aid. Due to the prolonged military offensive in Aceh, that province's contribution to the country's economy has been limited. But this a litmus test for the government, as it addresses the accusations of corruption that have circulated regarding money destined for impoverished regions. Furthermore, its resolve to push through cuts in fuel subsidies will be severely tested in a time of compassion. In summary, time will tell whether a popularly elected President can pave the way for meaningful legal and corporate reforms, facilitate investments and job creation and make better use of the country's natural resources, among other issues. These efforts may be aided by the recent election of the incumbent Vice President as leader of the former opposition Golkar party. The President now has an opportunity to make real changes with a parliament that is likely to be more cooperative than before, potentially resulting in the eradication of corruption and the adoption of pro-growth policies. Sincerely, /s/ Boon Hong Yeo Boon Hong Yeo Chief Investment Officer** INTERNATIONAL INVESTING ENTAILS SPECIAL RISK CONSIDERATIONS, INCLUDING CURRENCY FLUCTUATIONS, LOWER LIQUIDITY, ECONOMIC AND POLITICAL RISKS, AND DIFFERENCES IN ACCOUNTING METHODS. THERE ARE ALSO RISKS ASSOCIATED WITH INVESTING IN INDONESIA, INCLUDING THE RISK OF INVESTING IN A SINGLE-COUNTRY FUND. IN ADDITION TO HISTORICAL INFORMATION, THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS, WHICH MAY CONCERN, AMONG OTHER THINGS, DOMESTIC AND FOREIGN MARKET, INDUSTRY AND ECONOMIC TRENDS AND DEVELOPMENTS AND GOVERNMENT REGULATION AND THEIR POTENTIAL IMPACT ON THE FUND'S INVESTMENT PORTFOLIO. THESE STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES AND ACTUAL TRENDS, DEVELOPMENTS AND REGULATIONS IN THE FUTURE AND THEIR IMPACT ON THE FUND COULD BE MATERIALLY DIFFERENT FROM THOSE PROJECTED, ANTICIPATED OR IMPLIED. THE FUND HAS NO OBLIGATION TO UPDATE OR REVISE FORWARD-LOOKING STATEMENTS. * The Morgan Stanley Capital International Indonesia Index is an unmanaged index (with no defined investment objective) of Indonesian equities that includes reinvestment of net dividends, and is the exclusive property of Morgan Stanley Capital International Inc. Investors cannot invest directly in an index. ** Boon Hong Yeo, who is a Director of Credit Suisse Asset Management (Australia), Limited, is primarily responsible for management of the Fund's assets. He has served the Fund in such capacity since January 17, 2003. Mr. Yeo joined Credit Suisse Asset Management (Australia) Limited in 2002 from AIB Govett (Asia) Limited in Singapore, where he was Director of Private Equity and managed Asian equity portfolios. Previously, he was founder and Managing Director of Zenith Asset Management Singapore; and held various positions in Asian equity portfolio management, investment banking and corporate banking in Singapore. 2 THE INDONESIA FUND, INC. PORTFOLIO SUMMARY - AS OF DECEMBER 31, 2004 (UNAUDITED) [CHART] SECTOR ALLOCATION
DECEMBER 31, 2004 DECEMBER 31, 2003 Automotive 9.51% 7.55% Banks 21.44% 14.11% Building & Construction-Miscellaneous 1.48% 0.00% Building Products-Cement/Aggregate 2.64% 3.86% Food & Kindred Products 2.12% 5.45% Gas-Distribution 1.46% 0.00% Machinery-Construction & Mining 4.75% 2.08% Medical-Drugs 4.59% 5.74% Metal Products-Fasteners 1.34% 2.28% Retail-Major Department Stores 1.41% 1.88% Soap & Cleaning Preparation 1.42% 2.61% Telecommunications 23.69% 19.73% Tobacco 18.14% 21.92% Other 5.02% 12.07% Cash & Other Assets 0.99% 0.72%
TOP 10 HOLDINGS, BY ISSUER
PERCENT OF HOLDING SECTOR NET ASSETS - ------------------------------------------------------------------------------------------ 1. PT Telekomunikasi Indonesia Telecommunications 19.7 2. PT Hanjaya Mandala Sampoerna Tbk Tobacco 13.9 3. PT Astra International Tbk Automotive 7.9 4. PT Bank Rakyat Indonesia Banks 6.3 5. PT Bank Central Asia Tbk Banks 5.9 6. PT United Tractors Tbk Machinery-Construction & Mining 4.8 7. PT Gudang Garam Tbk Tobacco 4.2 8. PT Bank Mandiri Banks 4.0 9. PT Indosat Tbk Telecommunications 4.0 10. PT Bank Danamon Indonesia Tbk Banks 3.7
3 THE INDONESIA FUND, INC. SCHEDULE OF INVESTMENTS - DECEMBER 31, 2004
NO. OF DESCRIPTION SHARES VALUE - ------------------------------------------------------------------------------------ EQUITY SECURITIES-99.01% INDONESIA-89.89% AUTOMOTIVE-7.88% PT Astra International Tbk 3,203,461 $ 3,313,230 --------------- BANKS-19.84% PT Bank Central Asia Tbk 7,728,000 2,473,985 PT Bank Danamon Indonesia Tbk 3,253,000 1,535,343 PT Bank Mandiri 8,164,000 1,697,986 PT Bank Rakyat Indonesia 8,483,000 2,631,629 --------------- 8,338,943 --------------- BUILDING & CONSTRUCTION-MISCELLANEOUS-1.48% PT Adhi Karya Tbk+ 8,617,000 623,743 --------------- BUILDING PRODUCTS-CEMENT/AGGREGATE-1.63% PT Indocement Tunggal Prakarsa Tbk+ 1,855,000 614,964 PT Semen Cibinong Tbk+ 1,105,000 68,633 --------------- 683,597 --------------- FINANCE-CONSUMER LOANS-0.97% PT Adira Dinamika Multi Finance Tbk+ 1,338,500 407,354 --------------- FOOD & KINDRED PRODUCTS-2.12% PT Indofood Sukses Makmur Tbk 10,336,000 892,123 --------------- GAS-DISTRIBUTION-1.46% PT Perusahaan Gas Negara 2,991,500 611,882 --------------- MACHINERY-CONSTRUCTION & MINING-4.75% PT United Tractors Tbk 8,134,200 1,994,770 --------------- MEDICAL-DRUGS-4.59% PT Kalbe Farma Tbk 23,249,800 1,373,499 PT Tempo Scan Pacific Tbk 680,000 554,594 --------------- 1,928,093 --------------- REAL ESTATE OPERATIONS/DEVELOPMENT-0.51% PT Ciputra Surya Tbk 1,350,000 214,021 --------------- RETAIL-MAJOR DEPARTMENT STORES-1.41% PT Matahari Putra Prima Tbk 3,168,000 $ 196,248 PT Ramyana Lestari Sentosa Tbk 4,764,500 397,760 --------------- 594,008 --------------- SOAP & CLEANING PREPARATION-1.42% PT Unilever Indonesia Tbk 1,678,000 596,533 --------------- TELECOMMUNICATIONS-23.69% PT Indosat Tbk 2,723,000 1,692,208 PT Telekomunikasi Indonesia 15,902,560 8,262,381 --------------- 9,954,589 --------------- TOBACCO-18.14% PT Gudang Garam Tbk 1,217,500 1,780,620 PT Hanjaya Mandala Sampoerna Tbk 8,154,000 5,840,420 --------------- 7,621,040 --------------- TOTAL INDONESIA (Cost $20,104,870) 37,773,926 --------------- HONG KONG-0.74% APPAREL MANUFACTURERS-0.74% Ports Design Ltd.+ (Cost $197,664) 578,000 312,324 --------------- INDIA-1.63% AUTOMOTIVE-1.63% ABN NV-Maruti Udyog Ltd. (Cost $597,612) 64,400 683,333 --------------- MALAYSIA-0.19% OIL & GAS DRILLING-0.19% SapuraCrest Petroleum Berhad+ (Cost $86,262) 270,000 80,254 --------------- SINGAPORE-3.12% COMPUTERS-MEMORY DEVICES-0.56% Norelco Centreline Holdings Ltd. 591,000 234,134 ---------------
See accompanying notes to financial statements. 4
NO. OF DESCRIPTION SHARES VALUE - ------------------------------------------------------------------------------------ INTERNET APPLICATION SOFTWARE-1.22% Global Voice Group Ltd.+ 7,944,000 $ 513,411 --------------- METAL PRODUCTS-FASTENERS-1.34% Unisteel Technology Ltd. 617,000 561,854 --------------- TOTAL SINGAPORE (Cost $1,412,226) 1,309,399 --------------- SOUTH KOREA-0.83% AIRLINES-0.83% Korean Air Lines Co., Ltd.+ (Cost $284,225) 19,100 347,926 --------------- THAILAND-2.61% BANKS-1.60% Siam City Bank Public Company Ltd. 1,034,000 672,034 --------------- BUILDING PRODUCTS-CEMENT/AGGREGATE-1.01% Siam Cement Public Company Ltd. (The) 60,000 426,255 --------------- TOTAL THAILAND (Cost $869,681) 1,098,289 --------------- TOTAL EQUITY SECURITIES (Cost $23,552,540) 41,605,451 --------------- SHORT-TERM INVESTMENTS-3.07% GRAND CAYMAN-3.07% Wells Fargo Bank N.A., overnight deposit, 1.35%, 01/03/05* (Cost $1,290,000) $ 1,290 $ 1,290,000 --------------- INDONESIA-0.00% Citibank N.A., Jakarta, overnight deposit, 0.64%, 01/03/05* (Cost $35) 0 35 --------------- TOTAL SHORT-TERM INVESTMENTS (Cost $1,290,035) 1,290,035 --------------- TOTAL INVESTMENTS-102.08% (Cost $24,842,575) (Notes A,D,F) 42,895,486 --------------- LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS-(2.08)% (875,732) --------------- NET ASSETS-100.00% $ 42,019,754 ===============
+ Non-income producing security. * Variable rate account. Rate resets on a daily basis; amounts are available on the same business day. See accompanying notes to financial statements. 5 THE INDONESIA FUND, INC. STATEMENT OF ASSETS AND LIABILITIES - DECEMBER 31, 2004 ASSETS Investments, at value (Cost $24,842,575 ) (Notes A,D,F) $ 42,895,486 Cash 921 Dividends receivable 48,811 Prepaid expenses 3,439 --------------- Total Assets 42,948,657 --------------- LIABILITIES Payables: Dividends (Note A) 743,958 Investment advisory fees (Note B) 99,002 Administration fees (Note B) 4,934 Directors' fees 1,943 Other accrued expenses 79,066 --------------- Total Liabilities 928,903 --------------- NET ASSETS (applicable to 8,266,202 shares of common stock outstanding) (Note C) $ 42,019,754 =============== NET ASSETS CONSIST OF Capital stock, $0.001 par value; 8,266,202 shares issued and outstanding (100,000,000 shares authorized) $ 8,266 Paid-in capital 52,050,643 Undistributed net investment income 12,800 Accumulated net realized loss on investments and foreign currency related transactions (28,104,955) Net unrealized appreciation in value of investments and translation of other assets and liabilities denominated in foreign currencies 18,053,000 --------------- Net assets applicable to shares outstanding $ 42,019,754 =============== NET ASSET VALUE PER SHARE ($42,019,754 DIVIDED BY 8,266,202) $ 5.08 =============== MARKET PRICE PER SHARE $ 5.07 ===============
See accompanying notes to financial statements. 6 STATEMENT OF OPERATIONS - FOR THE YEAR ENDED DECEMBER 31, 2004 INVESTMENT INCOME Income (Note A): Dividends $ 1,740,821 Interest 6,332 Less: Foreign taxes withheld (255,197) --------------- Total Investment Income 1,491,956 --------------- Expenses: Investment advisory fees (Note B) 349,356 Custodian fees 74,172 Legal fees 46,722 Printing (Note B) 43,646 Administration fees (Note B) 40,509 Audit fees 38,794 Directors' fees 30,998 Accounting fees 30,001 Transfer agent fees 18,762 Stock exchange listing fees 17,499 Insurance 12,201 Miscellaneous 7,304 --------------- Total Expenses 709,964 --------------- Net Investment Income 781,992 --------------- NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCY RELATED TRANSACTIONS Net realized gain/(loss) from: Investments 3,211,181 Foreign currency related transactions (23,005) Net change in unrealized appreciation in value of investments and translation of other assets and liabilities denominated in foreign currencies 6,531,330 --------------- Net realized and unrealized gain on investments and foreign currency related transactions 9,719,506 --------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 10,501,498 ===============
See accompanying notes to financial statements. 7 THE INDONESIA FUND, INC. STATEMENT OF CHANGES IN NET ASSETS
For the Years Ended December 31, --------------------------------- 2004 2003 --------------- --------------- INCREASE IN NET ASSETS Operations: Net investment income $ 781,992 $ 284,627 Net realized gain on investments and foreign currency related transactions 3,188,176 2,899,547 Net change in unrealized appreciation/depreciation in value of investments and translation of other assets and liabilities denominated in foreign currencies 6,531,330 12,005,604 --------------- --------------- Net increase in net assets resulting from operations 10,501,498 15,189,778 --------------- --------------- Dividends to shareholders: Net investment income (785,289) (203,349) --------------- --------------- Total increase in net assets 9,716,209 14,986,429 --------------- --------------- NET ASSETS Beginning of year 32,303,545 17,317,116 --------------- --------------- End of year* $ 42,019,754 $ 32,303,545 =============== ===============
- ---------- * Includes undistributed net investment income of $12,800 and $39,102, respectively. See accompanying notes to financial statements. 8 This page intentionally left blank. 9 THE INDONESIA FUND, INC. FINANCIAL HIGHLIGHTS Contained below is per share operating performance data for a share of common stock outstanding, total investment return, ratio to average net assets and other supplemental data for each year indicated. This information has been derived from information provided in the financial statements and market price data for the Fund's shares.
FOR THE YEARS ENDED DECEMBER 31, --------------------------------------------------- 2004 2003 2002 2001 ---------- ---------- ---------- ---------- PER SHARE OPERATING PERFORMANCE Net asset value, beginning of year $ 3.91 $ 2.09 $ 1.52 $ 1.72 ---------- ---------- ---------- ---------- Net investment income/(loss) 0.09 0.03 0.01 (0.13)* Net realized and unrealized gain/(loss) on investments and foreign currency related transactions 1.17 1.81 0.56 (0.07) ---------- ---------- ---------- ---------- Net increase/(decrease) in net assets resulting from operations 1.26 1.84 0.57 (0.20) ---------- ---------- ---------- ---------- Dividends and distributions to shareholders: Net investment income (0.09) (0.02) -- -- Net realized gain on investments and foreign currency related transactions -- -- -- -- ---------- ---------- ---------- ---------- Total dividends and distributions to shareholders (0.09) (0.02) -- -- ---------- ---------- ---------- ---------- Net asset value, end of year $ 5.08 $ 3.91 $ 2.09 $ 1.52 ========== ========== ========== ========== Market value, end of year $ 5.07 $ 4.83 $ 1.65 $ 1.32 ========== ========== ========== ========== Total investment return (a) 6.72% 194.19% 25.00% (15.52)% ========== ========== ========== ========== RATIOS/SUPPLEMENTAL DATA Net assets, end of year (000 omitted) $ 42,020 $ 32,304 $ 17,317 $ 12,545 Ratio of expenses to average net assets 2.03% 2.65% 2.69% 8.89%(b) Ratio of net investment income/(loss) to average net assets 2.24% 1.23% 0.36% (5.63)% Portfolio turnover rate 43.59% 95.66% 29.15% 10.23%
* Based on actual shares outstanding on June 8, 2001 (prior to the Agreement and Plan of Reorganization effective June 11, 2001 between the Fund and Jakarta Growth Fund) and December 31, 2001. (a) Total investment return at market value is based on the changes in market price of a share during the year and assumes reinvestment of dividends and distributions, if any, at actual prices pursuant to the Fund's dividend reinvestment program. (b) Excluding merger-related fees, the ratio of expenses to average net assets would have been 4.31%. (c) Excluding merger-related fees, the ratio of expenses to average net assets would have been 4.13%. See accompanying notes to financial statements. 10
FOR THE YEARS ENDED DECEMBER 31, ----------------------------------------- 2000 1999 1998 ---------- ---------- ---------- PER SHARE OPERATING PERFORMANCE Net asset value, beginning of year $ 4.48 $ 2.71 $ 3.58 ---------- ---------- ---------- Net investment income/(loss) (0.13) (0.05) (0.04) Net realized and unrealized gain/(loss) on investments and foreign currency related transactions (2.63) 1.87 (0.83) ---------- ---------- ---------- Net increase/(decrease) in net assets resulting from operations (2.76) 1.82 (0.87) ---------- ---------- ---------- Dividends and distributions to shareholders: Net investment income -- -- -- Net realized gain on investments and foreign currency related transactions -- (0.05) -- ---------- ---------- ---------- Total dividends and distributions to shareholders -- (0.05) -- ---------- ---------- ---------- Net asset value, end of year $ 1.72 $ 4.48 $ 2.71 ========== ========== ========== Market value, end of year $ 1.563 $ 5.438 $ 3.438 ========== ========== ========== Total investment return (a) (71.26)% 59.58% (25.68)% ========== ========== ========== RATIOS/SUPPLEMENTAL DATA Net assets, end of year (000 omitted) $ 7,935 $ 20,669 $ 12,491 Ratio of expenses to average net assets 7.23%(c) 3.18% 4.21% Ratio of net investment income/(loss) to average net assets (4.85)% (1.43)% (1.37)% Portfolio turnover rate 16.48% 47.38% 36.58% For the Years Ended December 31, -------------------------------------- 1997 1996 1995 ---------- ---------- ---------- PER SHARE OPERATING PERFORMANCE Net asset value, beginning of year $ 10.68 $ 9.34 $ 9.18 ---------- ---------- ---------- Net investment income/(loss) 0.03 0.01 Net realized and unrealized gain/(loss) on investments and foreign currency related transactions (7.13) 1.33 0.16 ---------- ---------- ---------- Net increase/(decrease) in net assets resulting from operations (7.10) 1.34 0.16 ---------- ---------- ---------- Dividends and distributions to shareholders: Net investment income -- -- -- Net realized gain on investments and foreign currency related transactions -- -- -- ---------- ---------- ---------- Total dividends and distributions to shareholders -- -- -- ---------- ---------- ---------- Net asset value, end of year $ 3.58 $ 10.68 $ 9.34 ========== ========== ========== Market value, end of year $ 4.625 $ 9.750 $ 10.125 ========== ========== ========== Total investment return (a) (52.56)% (3.70)% (15.63)% ========== ========== ========== RATIOS/SUPPLEMENTAL DATA Net assets, end of year (000 omitted) $ 16,486 $ 49,223 $ 43,060 Ratio of expenses to average net assets 1.89% 1.91% 1.96% Ratio of net investment income/(loss) to average net assets 0.33% 0.10% 0.05% Portfolio turnover rate 48.19% 34.67% 24.10%
11 THE INDONESIA FUND, INC. NOTES TO FINANCIAL STATEMENTS NOTE A. SIGNIFICANT ACCOUNTING POLICIES The Indonesia Fund, Inc. (the "Fund") was incorporated in Maryland on January 8, 1990 and commenced investment operations on March 9, 1990. The Fund is registered under the Investment Company Act of 1940, as amended, as a closed-end, non-diversified management investment company. USE OF ESTIMATES: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. SECURITY VALUATION: The net asset value of the Fund is determined daily as of the close of regular trading on the New York Stock Exchange, Inc. (the "Exchange") on each day the Exchange is open for business. The Fund's equity investments are valued at market value, which is generally determined using the closing price on the exchange or market on which the security is primarily traded at the time of valuation (the "Valuation Time"). If no sales are reported, equity investments are generally valued at the most recent bid quotation as of the Valuation Time or at the lowest ask quotation in the case of a short sale of securities. Debt securities with a remaining maturity greater than 60 days are valued in accordance with the price supplied by a pricing service, which may use a matrix, formula or other objective method that takes into consideration market indices, yield curves and other specific adjustments. Debt obligations that will mature in 60 days or less are valued on the basis of amortized cost, which approximates market value, unless it is determined that this method would not represent fair value. Securities and other assets for which market quotations are not readily available, or whose values have been materially affected by events occurring before the Fund's Valuation Time, but after the close of the securities' primary market, are valued at fair value as determined in good faith by, or under the direction of, the Board of Directors under procedures established by the Board of Directors. The Fund may utilize a service provided by an independent third party which has been approved by the Board of Directors to fair value certain securities. The Fund's estimate of fair value assumes a willing buyer and a willing seller neither acting under a compulsion to buy or sell. SHORT-TERM INVESTMENTS: The Fund sweeps available U.S. dollar cash into a short-term deposit issued by Wells Fargo Bank N.A. The Fund also sweeps available cash denominated in Indonesian rupiah into a short-term deposit issued by Citibank N.A., Jakarta. These short-term time deposits are variable rate accounts classified as short-term investments. INVESTMENT TRANSACTIONS AND INVESTMENT INCOME: Investment transactions are accounted for on a trade date basis. The cost of investments sold is determined by use of the specific identification method for both financial reporting and U.S. income tax purposes. Interest income is accrued as earned; dividend income is recorded on the ex-dividend date. TAXES: No provision is made for U.S. income or excise taxes as it is the Fund's intention to continue to qualify as a regulated investment company and to make the requisite distributions to its shareholders sufficient to relieve it from all or substantially all U.S. income and excise taxes. Income received by the Fund from sources within Indonesia and other foreign countries may be subject to withholding and other taxes imposed by such countries. 12 FOREIGN CURRENCY TRANSLATIONS: The books and records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on the following basis: (I) market value of investment securities, assets and liabilities at the valuation date rate of exchange; and (II) purchases and sales of investment securities, income and expenses at the relevant rates of exchange prevailing on the respective dates of such transactions. The Fund does not isolate that portion of gains and losses in investments in equity securities which is due to changes in the foreign exchange rates from that which is due to changes in market prices of equity securities. Accordingly, realized and unrealized foreign currency gains and losses with respect to such securities are included in the reported net realized and unrealized gains and losses on investment transactions balances. The Fund reports certain foreign currency related transactions and foreign taxes withheld on security transactions as components of realized gains for financial reporting purposes, whereas such foreign currency related transactions are treated as ordinary income for U.S. income tax purposes. Net unrealized currency gains or losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation/depreciation in value of investments, and translation of other assets and liabilities denominated in foreign currencies. Net realized foreign exchange gains or losses represent foreign exchange gains and losses from transactions in foreign currencies and forward foreign currency contracts, exchange gains or losses realized between the trade date and settlement date on security transactions, and the difference between the amounts of interest and dividends recorded on the Fund's books and the U.S. dollar equivalent of the amounts actually received. DISTRIBUTIONS OF INCOME AND GAINS: The Fund distributes at least annually to shareholders substantially all of its net investment income and net realized short-term capital gains, if any. The Fund determines annually whether to distribute any net realized long-term capital gains in excess of net realized short-term capital losses, including capital loss carryovers, if any. An additional distribution may be made to the extent necessary to avoid the payment of a 4% U.S. federal excise tax. Dividends and distributions to shareholders are recorded by the Fund on the ex-dividend date. The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for U.S. income tax purposes due to U.S. generally accepted accounting principles/tax differences in the character of income and expense recognition. OTHER: The Fund may invest in securities of foreign countries and governments which involve certain risks in addition to those inherent in domestic investments. Such risks generally include, among others currency risks (fluctuations in currency exchange rates), information risk (key information may be inaccurate or unavailable) and political risk (expropriation, nationalization or the imposition of capital or currency controls or punitive taxes). Other risks of investing in foreign securities include liquidity and valuation risks. Securities denominated in currencies other than U.S. dollars are subject to changes in value due to fluctuations in exchange rates. 13 Investment in Indonesian and other foreign securities requires consideration of certain factors that are not normally involved in investments in U.S. securities. The Indonesian securities market is an emerging market characterized by a small number of company listings, high price volatility and a relatively illiquid secondary trading environment. These factors, coupled with restrictions on investment by foreigners and other factors, limit the supply of securities available for investment by the Fund. This will affect the rate at which the Fund is able to invest in Indonesian and other foreign securities, the purchase and sale prices for such securities and the timing of purchases and sales. The limited liquidity of the Indonesian and other foreign securities markets may also affect the Fund's ability to acquire or dispose of securities at a price and time that it wishes to do so. Accordingly, in periods of rising market prices, the Fund may be unable to participate in such price increases fully to the extent that is unable to acquire desired portfolio positions quickly; conversely the Fund's inability to dispose fully and promptly of positions in declining markets will cause its net asset value to decline as the value of unsold positions is marked to lower prices. NOTE B. AGREEMENTS Credit Suisse Asset Management, LLC ("CSAM"), serves as the Fund's investment adviser with respect to all investments. CSAM receives as compensation for its advisory services from the Fund, an annual fee, calculated weekly and paid quarterly, equal to 1.00% of the Fund's average weekly net assets. For the year ended December 31, 2004, CSAM earned $349,356 for advisory services. CSAM also provides certain administrative services to the Fund and is reimbursed by the Fund for costs incurred on behalf of the Fund (up to $20,000 per annum). For the year ended December 31, 2004, CSAM was reimbursed $5,574 for administrative services rendered to the Fund. Credit Suisse Asset Management (Australia) Limited ("Sub-Adviser") serves as the Fund's sub-investment adviser. CSAM currently pays the Sub-Adviser on a quarterly basis a fee of 90% of the net quarterly amount received by CSAM as the Fund's investment adviser. The Fund does not pay the Sub-Adviser. Bear Stearns Funds Management Inc. ("BSFM") serves as the Fund's administrator. The Fund pays BSFM a monthly fee that is computed weekly at an annual rate of 0.10% of the first $100 million of the Fund's average weekly net assets and 0.08% of amounts in excess of $100 million. For the year ended December 31, 2004, BSFM earned $34,935 for administrative services. Merrill Corporation ("Merrill"), an affiliate of CSAM, has been engaged by the Fund to provide certain financial printing services. For year ended December 31, 2004, Merrill was paid $34,503 for its services to the Fund. NOTE C. CAPITAL STOCK The authorized capital stock of the Fund is 100,000,000 shares of common stock, $0.001, par value. Of the 8,266,202 shares outstanding at December 31, 2004, CSAM owned 7,169 shares. NOTE D. INVESTMENT IN SECURITIES For the year ended December 31, 2004, purchases and sales of securities, other than short-term investments, were $14,926,344 and $15,134,796, respectively. NOTE E. CREDIT FACILITY The Fund, together with other funds/portfolios advised by CSAM (collectively, the "Participating Funds"), participates in a $75 million committed, unsecured, line of credit facility ("Credit Facility") with Deutsche Bank, A.G. as administrative agent and syndication agent and State Street Bank and Trust Company as operations agent for temporary or emergency purposes. Under the terms of the Credit Facility, the 14 Participating Funds pay an aggregate commitment fee at a rate of 0.10% per annum on the average unused amount of the Credit Facility, which is allocated among the Participating Funds in such manner as is determined by the governing Boards of the Participating Funds. In addition, the Participating Funds pay interest on borrowings at the Federal Funds rate plus 0.50%. The Fund had no borrowings under the Credit Facility at December 31, 2004. NOTE F. FEDERAL INCOME TAXES Income and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP. These differences are primarily due to foreign currency transactions, post-October losses on foreign currency transactions and losses deferred due to wash sales. The tax character of dividends paid during the years ended December 31, for the Fund were as follows:
ORDINARY INCOME ------------------------ 2004 2003 ---------- ---------- $ 785,289 $ 203,349
At December 31, 2004, the components of distributable earnings on a tax basis, for the Fund were as follows: Undistributed ordinary income $ 12,800 Accumulated net realized loss (26,646,783) Unrealized appreciation 16,594,828 ------------- Total distributable earnings $ (10,039,155) =============
At December 31, 2004, the Fund had a capital loss carryover for U.S. federal income tax purposes of $26,646,783 of which $3,265,956 expires in 2005; $13,254,308 expires in 2006; $1,782,694 expires in 2007; $5,937,713 expires in 2008 ($2,211,704 of capital loss carryfoward expiring in 2008 is subject to annual limitations of $292,278), $1,720,106 expires in 2009 and $686,006 expires in 2010. For the year ended December 31, 2004, the Fund utilized capital loss carryovers of $3,110,515. It is uncertain whether the Fund will be able to realize the benefits before they expire. At December 31, 2004, the identified cost for federal income tax purposes, as well as the gross unrealized appreciation from investments for those securities having an excess of value over cost, gross unrealized depreciation from investments for those securities having an excess of cost over value and the net unrealized appreciation from investments were $26,300,747, $18,080,172, $(1,485,433), and $16,594,739, respectively. At December 31, 2004, the Fund reclassified $23,005 from accumulated net realized loss on foreign currency related transactions to undistributed net investment income. In addition, the Fund reclassified $1,577,896 of capital loss carryover for U.S. federal income tax purposes which expired in 2004 and $5,475,154 of capital loss carryover lost from the Fund's merger with Jakarta Fund in 2001 to paid-in capital, to adjust for current period permanent book/tax differences. Net assets were not affected by these reclassifications. 15 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of The Indonesia Fund, Inc.: In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations, of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of The Indonesia Fund, Inc. (the "Fund") at December 31, 2004, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the ten years in the period ended, 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements 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 December 31, 2004 by correspondence with the custodian, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Philadelphia, Pennsylvania February 18, 2005 16 RESULTS OF ANNUAL MEETING OF SHAREHOLDERS (UNAUDITED) On April 22, 2004, the Annual Meeting of Shareholders of The Indonesia Fund, Inc. (the "Fund") (the "Meeting") was held and the following matter was voted upon: (1) To re-elect a director to the Board of Directors of the Fund:
NAME OF DIRECTOR FOR WITHHELD - ---------------- --------- -------- Richard H. Francis 4,922,632 147,490
In addition to the director re-elected at the Meeting, Enrique R. Arzac, Lawrence J. Fox and William W. Priest, Jr. continue as directors of the Fund. Effective August 10, 2004, Michael E. Kenneally was appointed as Director, Chairman of the Board, Chief Executive Officer and President. Joseph D. Gallagher, who previously held these positions, resigned from the Fund effective the same day. TAX INFORMATION (UNAUDITED) The Fund is required by Subchapter M of the Internal Revenue Code of 1986, as amended, to advise its shareholders within 60 days of the Fund's year end (December 31, 2004) as to the U.S. federal tax status of dividends and distributions received by the Fund's shareholders in respect of such year. The $0.0950 per share dividend paid in respect of such year, is represented entirely by net investment income. The Fund has met the requirements to pass through all ordinary income as qualified dividends as noted on Box 1B on Form 1099-DIV. Please note that to utilize the lower tax rate for qualifying dividend income shareholders must have held their shares in the Fund for at least 61 days during the 121 day period beginning 60 days before the ex-dividend date. The Fund has made an election under Section 853 to pass through foreign taxes paid by the Fund to its shareholders. The total amount of foreign taxes that were passed through to shareholders for the year ended December 31, 2004, were $244,947, equal to $0.0300 per share from Indonesia. The entire amount of foreign source income is from qualifying dividend income. This information is given to meet certain requirements of the Internal Revenue Code of 1986, as amended. Shareholders should refer to their Form 1099-DIV to determine the amount includable on their respective tax returns for 2004. Notification for calendar year 2004 was mailed in January 2005. The notification along with Form 1099-DIV reflects the amount to be used by calendar year taxpayers on their U.S. federal income tax returns. Foreign shareholders will generally be subject to U.S. withholding tax on the amount of the actual ordinary dividends paid by the Fund. They will generally not be entitled to foreign tax credit or deduction for the withholding taxes paid by the Fund. In general, dividends and distributions received by tax-exempt recipients (e.g., IRAs and Keoghs) need not be reported as taxable income for U.S. federal income tax purposes. However, some retirement trusts (e.g., corporate, Keogh and 403(b)(7) plans) may need this information for their annual information reporting. Shareholders are advised to consult their own tax advisers with respect to the tax consequences of their investment in the Fund. 17 DESCRIPTION OF INVESTLINK(SM) PROGRAM (UNAUDITED) The InvestLink(SM) Program is sponsored and administered by EquiServe Trust Company, N.A., with EquiServe, Inc. acting as service agent to the aforementioned and, not by The Indonesia Fund, Inc. (the "Fund"). EquiServe Trust Company, N.A., will act as program administrator (the "Program Administrator") of the InvestLink(SM) Program (the "Program"). The purpose of the Program is to provide existing shareholders with a simple and convenient way to invest additional funds and reinvest dividends in shares of the Fund's common stock ("Shares") at prevailing prices, with reduced brokerage commissions and fees. In order to participate in the Program, you must be a registered holder of at least one Share of stock of the Fund. Purchases of Shares with funds from a participant's cash payment or automatic account deduction will begin on the next day on which funds are invested. All cash payments must be drawn on a U.S. bank and payable in U.S. dollars. Checks must be made payable to EquiServe. If a participant selects the dividend reinvestment option, automatic investment of dividends generally will begin with the next dividend payable after the Program Administrator receives his enrollment form. Once in the Program, a person will remain a participant until he terminates his participation or sells all Shares held in his Program account, or his account is terminated by the Program Administrator. A participant may change his investment options at any time by requesting a new enrollment form and returning it to the Program Administrator. A participant will be assessed certain charges in connection with his participation in the Program. All optional cash deposit investments will be subject to a service charge. Sales processed through the Program will have a service fee deducted from the net proceeds, after brokerage commissions. In addition to the transaction charges outlined above, participants will be assessed per share processing fees (which include brokerage commissions.) Participants will not be charged any fee for reinvesting dividends. The number of Shares to be purchased for a participant depends on the amount of his dividends, cash payments or bank account or payroll deductions, less applicable fees and commissions, and the purchase price of the Shares. The investment date for cash payments is the 25th day of each month (or the next trading day if the 25th is not a trading day). The investment date for dividend reinvestment is the dividend payment date. The Program Administrator uses dividends and funds of participants to purchase Shares of the Fund in the open market. Such purchases will be made by participating brokers as agent for the participants using normal cash settlement practices. All Shares purchased through the Program will be allocated to participants as of the settlement date, which is usually three business days from the purchase date. In all cases, transaction processing will occur within 30 days of the receipt of funds, except where temporary curtailment or suspension of purchases is necessary to comply with applicable provisions of the Federal Securities laws or when unusual market conditions make prudent investment impracticable. In the event the Program Administrator is unable to purchase Shares within 30 days of the receipt of funds, such funds will be returned to the participants. The average price of all Shares purchased by the Program Administrator with all funds received during the time period from two business days preceding any investment date up to the second business day preceding the next investment date shall be the price per share allocable to a participant in connection with the Shares purchased for his account with his funds or dividends received by the Program Administrator during such time period. The average price of all Shares sold by the Program Administrator pursuant to sell orders received during such time period shall be the price per share allocable to a participant in connection with the Shares sold for his account pursuant to his sell orders received by the Program Administrator during such time period. All sale requests having an anticipated market value of $100,000.00 or more are expected to be submitted in written form. In addition, all sale requests received by the Program Administrator within thirty (30) days of an 18 address change are expected to be submitted in written form. EquiServe Trust Company, N.A., as Program Administrator, administers the Program for participants, keeps records, sends statements of account to participants and performs other duties relating to the Program. Each participant in the Program will receive a statement of his account following each purchase of Shares. The statements will also show the amount of dividends credited to such participant's account (if applicable), as well as the fees paid by the participant. In addition, each participant will receive copies of the Fund's annual and semi-annual reports to shareholders, proxy statements and, if applicable, dividend income information for tax reporting purposes. If the Fund is paying dividends on the Shares, a participant will receive dividends through the Program for all Shares held on the dividend record date on the basis of full and fractional Shares held in his account, and for all other Shares of the Fund registered in his name. The Program Administrator will send checks to the participants for the amounts of their dividends that are not to be automatically reinvested at no cost to the participants. Shares of the Fund purchased under the Program will be registered in the name of the accounts of the respective participants. Unless requested, the Fund will not issue to participants certificates for Shares of the Fund purchased under the Program. The Program Administrator will hold the Shares in book-entry form until a Program participant chooses to withdraw his Shares or terminate his participation in the Program. The number of Shares purchased for a participant's account under the Program will be shown on his statement of account. This feature protects against loss, theft or destruction of stock certificates. A participant may withdraw all or a portion of the Shares from his Program account by notifying the Program Administrator. After receipt of a participant's request, the Program Administrator will issue to such participant certificates for the whole Shares of the Fund so withdrawn or, if requested by the participant, sell the Shares for him and send him the proceeds, less applicable brokerage commissions, fees, and transfer taxes, if any. If a participant withdraws all full and fractional Shares in his Program account, his participation in the Program will be terminated by the Program Administrator. In no case will certificates for fractional Shares be issued. The Program Administrator will convert any fractional Shares held by a participant at the time of his withdrawal to cash. Participation in any rights offering, dividend distribution or stock split will be based upon both the Shares of the Fund registered in participants' names and the Shares (including fractional Shares) credited to participants' Program accounts. Any stock dividend or Shares resulting from stock splits with respect to Shares of the Fund, both full and fractional, which participants hold in their Program accounts and with respect to all Shares registered in their names will be automatically credited to their accounts. All Shares of the Fund (including any fractional share) credited to his account under the Program will be voted as the participant directs. The participants will be sent the proxy materials for the annual meetings of shareholders. When a participant returns an executed proxy, all of such Shares will be voted as indicated. A participant may also elect to vote his Shares in person at the Shareholders' meeting. A participant will receive tax information annually for his personal records and to help him prepare his U.S. federal income tax return. The automatic reinvestment of dividends does not relieve him of any income tax which may be payable on dividends. For further information as to tax consequences of participation in the Program, participants should consult with their own tax advisors. 19 The Program Administrator in administering the Program will not be liable for any act done in good faith or for any good faith omission to act. However, the Program Administrator will be liable for loss or damage due to error caused by its negligence, bad faith or willful misconduct. Shares held in custody by the Program Administrator are not subject to protection under the Securities Investors Protection Act of 1970. The participant should recognize that neither the Fund nor the Program Administrator can provide any assurance of a profit or protection against loss on any Shares purchased under the Program. A participant's investment in Shares held in his Program account is no different than his investment in directly held Shares in this regard. The participant bears the risk of loss and the benefits of gain from market price changes with respect to all of his Shares. Neither the Fund nor the Program Administrator can guarantee that Shares purchased under the Program will, at any particular time, be worth more or less than their purchase price. Each participant must make an independent investment decision based on his own judgment and research. While the Program Administrator hopes to continue the Program indefinitely, the Program Administrator reserves the right to suspend or terminate the Program at any time. It also reserves the right to make modifications to the Program. Participants will be notified of any such suspension, termination or modification in accordance with the terms and conditions of the Program. The Program Administrator also reserves the right to terminate any participant's participation in the Program at any time. Any question of interpretation arising under the Program will be determined in good faith by the Program Administrator and any such good faith determination will be final. Any interested shareholder may participate in the Program. All other cash payments or bank account deductions must be at least $100.00, up to a maximum of $100,000.00 annually. An interested shareholder may join the Program by reading the Program description, completing and signing the enrollment form and returning it to the Program Administrator. The enrollment form and information relating to the Program (including the terms and conditions) may be obtained by calling the Program Administrator at one of the following telephone numbers: (800) 730-6001 (U.S. and Canada) or (781) 575-3100 (outside U.S. and Canada). All correspondence regarding the Program should be directed to: EquiServe Trust Company, N.A., InvestLink(SM) Program, P.O. Box 43010, Providence, RI 02940-3010. InvestLink is a service mark of EquiServe Trust Company, N.A. 20 INFORMATION CONCERNING DIRECTORS AND OFFICERS (UNAUDITED)
TERM NUMBER OF OF OFFICE PORTFOLIOS IN AND FUND POSITION(S) LENGTH PRINCIPAL COMPLEX OTHER NAME, ADDRESS AND HELD WITH OF TIME OCCUPATION(S) DURING OVERSEEN BY DIRECTORSHIPS DATE OF BIRTH FUND SERVED THE PAST FIVE YEARS DIRECTOR HELD BY DIRECTOR - ------------------------ ---------------- ------------ ---------------------------- ------------- ------------------------- INDEPENDENT DIRECTORS Enrique R. Arzac Director; Since 2000; Professor of Finance and 8 Director of The Adams c/o Credit Suisse Asset Nominating current term Economics, Graduate Express Company (a Management, LLC Committee ends at the School of Business, closed-end investment Attn: General Counsel Chairman and 2006 annual Columbia University company); Director of end investment Audit Committee meeting since 1971 Petroleum and Resources 466 Lexington Avenue Member Corporation (a closed-end New York, New York investment company) 10017-3140 Date of Birth: 10/02/41 Lawrence J. Fox Director; Since 2000; Partner, Drinker Biddle 3 Director, Winthrop One Logan Square Nominating and current term & Reath (law firm) Trust Company 18th & Cherry Streets Audit Committee ends at the since 1972 Philadelphia, Member 2005 annual Pennsylvania 19103 meeting Date of Birth: 07/17/43 Richard H. Francis Director; Since 1990; Currently retired 41 None c/o Credit Suisse Asset Nominating current term Management, LLC Committee ends at the Attn: General Counsel Member and 2007 annual 466 Lexington Avenue Audit Committee meeting New York, New York Chairman 10017-3140 Date of Birth: 04/23/32 INTERESTED DIRECTORS Michael E. Kenneally*/** Director; Since 2004; Chairman and Global Chief 44 None c/o Credit Suisse Asset Chairman of the current term Executive Officer of CSAM Management, LLC Board, Chief ends at the since 2003; Chairman and 466 Lexington Avenue Executive 2005 annual Chief Investment Officer of New York, New York Officer and meeting Banc of America Capital 10017-3140 President Management from 1998 to March 2003; Officer of Date of Birth: 03/30/54 other Credit Suisse Funds
21
TERM NUMBER OF OF OFFICE PORTFOLIOS IN AND FUND POSITION(S) LENGTH PRINCIPAL COMPLEX OTHER NAME, ADDRESS AND HELD WITH OF TIME OCCUPATION(S) DURING OVERSEEN BY DIRECTORSHIPS DATE OF BIRTH FUND SERVED THE PAST FIVE YEARS DIRECTOR HELD BY DIRECTOR - ------------------------ ---------------- ------------ ---------------------------- ------------- ------------------------- INTERESTED DIRECTORS--(CONCLUDED) William W. Priest, Jr.** Director Since 1990; Chief Executive Officer of 47 Director of Globe Wireless, c/o Epoch Investment current term J Net Enterprises, Inc. (a LLC (a maritime Partners ends at the technology holding communications company); 667 Madison Avenue 2006 annual company) since June 2004; Director of InfraRed X (a New York, New York meeting Chief Executive Officer of medical device company); 10021 Epoch Investment Partners, Director of J Net Inc. since April 2004; Enterprises, Inc. Co-Managing Partner, Steinberg Priest & Sloane Capital Management, LLC from 2001 to March 2004; Chairman and Managing Director of CSAM from 2000 to February 2001, Chief Executive Officer and Managing Director of Date of Birth: 09/24/41 CSAM from 1990 to 2000 POSITION(S) LENGTH NAME, ADDRESS AND HELD WITH OF TIME DATE OF BIRTH FUND SERVED PRINCIPAL OCCUPATION(S) DURING THE PAST FIVE YEARS - ------------------------ ---------------- ------------ --------------------------------------------------------------- OFFICERS Boon Hong Yeo Chief Investment Since 2003 Director of Credit Suisse Asset Management (Australia) Limited: c/o Credit Suisse Asset Officer Director of AIB Govett (Asia) Limited from October 2001 to Management, LLC April 2002; Managing Director of Zenith Asset Management 466 Lexington Avenue Singapore from January 2001 to September 2001; Associate New York, New York Director of CMG First State Singapore from 1994 to 2000 10017-3140 Date of Birth: 05/02/60 Michael A. Pignataro Chief Financial Since 1993 Director and Director of Fund Administration of CSAM; Associated c/o Credit Suisse Asset Officer and with CSAM since 1984; Officer of other Credit Suisse Funds Management, LLC Secretary 466 Lexington Avenue New York, New York 10017-3140 Date of Birth: 11/15/59 Emidio Morizio Chief Since 2004 Director and Global Head of Compliance of CSAM; Associated with c/o Credit Suisse Asset Compliance CSAM since July 2000; Vice President and Director of Compliance Management, LLC Officer of Forstmann-Leff Associates from 1998 to June 2000; Officer of 466 Lexington Avenue other Credit Suisse Funds New York, New York 10017-3140 Date of Birth: 09/21/66
22
POSITION(S) LENGTH NAME, ADDRESS AND HELD WITH OF TIME DATE OF BIRTH FUND SERVED PRINCIPAL OCCUPATION(S) DURING THE PAST FIVE YEARS - ------------------------ ---------------- ------------ --------------------------------------------------------------- OFFICERS--(CONCLUDED) Ajay Mehra Chief Since 2004 Director and Deputy General Counsel of CSAM since September c/o Credit Suisse Asset Legal Officer 2004; Senior Associate of Shearman & Sterling LLP from Management, LLC September 2000 to September 2004; Senior Counsel of the SEC 466 Lexington Avenue Division of Investment Management from June 1997 to September New York, New York 2000; Officer of other Credit Suisse Funds 10017-3140 Date of Birth: 08/14/70 J. Kevin Gao Senior Vice Since 2004 Vice President and legal counsel of CSAM; Associated with CSAM c/o Credit Suisse Asset President since July 2003; Associated with the law firm of Willkie Farr & Management, LLC Gallagher LLP from 1998 to 2003; Officer of other Credit Suisse 466 Lexington Avenue Funds New York, New York 10017-3140 Date of Birth: 10/13/67 Robert M. Rizza Treasurer Since 1999 Assistant Vice President of CSAM since January 2001; Associated c/o Credit Suisse Asset with CSAM since 1998; Officer of other Credit Suisse Funds Management, LLC 466 Lexington Avenue New York, New York 10017-3140 Date of Birth: 12/09/65
* Effective August 10, 2004, Michael E. Kenneally was appointed as Director, Chairman of the Board, Chief Executive Officer and President of the Fund. Joseph D. Gallagher who previously held these positions has resigned effective August 10, 2004. ** Designates a director who is an "interested person" of the Fund as defined under the Investment Company Act 0f 1940, as amended. Mr. Kenneally is an interested person of the Fund by virtue of his current position as an officer of CSAM. Mr. Priest is an interested person of the Fund because, up to December 31, 2002, he was retained by CSAM to provide consulting services. PROXY POLICY AND PORTFOLIO HOLDINGS INFORMATION (UNAUDITED) Information regarding how The Indonesia Fund, Inc. (the "Fund") voted proxies related to its portfolio securities during the 12-month period ended June 30, 2004 as well as the policies and procedures that the Fund uses to determine how to vote proxies relating to its portfolio securities are available: - By calling 1-800-293-1232; - On the Fund's website, www.csam.com/us - On the website of the Securities and Exchange Commission, http://www.sec.gov. The Fund files a complete schedule of its portfolio holdings for the first and third quarters of its fiscal year with the SEC on Form N-Q. The Fund's Forms N-Q are available on the SEC's website at http://www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. 23 OTHER FUNDS MANAGED BY CREDIT SUISSE ASSET MANAGEMENT, LLC Credit Suisse Capital Appreciation Fund Credit Suisse Cash Reserve Fund Credit Suisse Emerging Markets Fund Credit Suisse Fixed Income Fund Credit Suisse Global Fixed Income Fund Credit Suisse Global Small Cap Fund Credit Suisse High Income Fund Credit Suisse International Focus Fund Credit Suisse Japan Equity Fund Credit Suisse Large Cap Value Fund Credit Suisse Mid-Cap Growth Fund Credit Suisse New York Municipal Fund Credit Suisse Select Equity Fund Credit Suisse Short Duration Bond Fund Credit Suisse Small Cap Growth Fund Credit Suisse Small Cap Value Fund Fund shares are not deposits or other obligations of Credit Suisse Asset Management, LLC or any affiliate, are not FDIC-insured and are not guaranteed by Credit Suisse Asset Management, LLC or any affiliate. Fund investments are subject to investment risks, including loss of your investment. There are special risk considerations associated with international, global, emerging-market, small-company, private equity, high-yield debt, single-industry, single-country and other special, aggressive or concentrated investment strategies. Past performance cannot guarantee future results. More complete information about a fund, including charges and expenses, is provided in the Prospectus, which should be read carefully before investing. You may obtain copies by calling Credit Suisse Funds at 800-927-2874. For up-to-date performance, please look in the mutual fund section of your newspaper under Credit Suisse. Credit Suisse Asset Management Securities, Inc., Distributor. 24 SUMMARY OF GENERAL INFORMATION The Fund--The Indonesia Fund, Inc.--is a closed-end, non-diversified management investment company whose shares trade on the American Stock Exchange, LLC. Its principal investment objective is long-term capital appreciation with income as a secondary objective through investments primarily in Indonesian equity and debt securities. Credit Suisse Asset Management, LLC (New York), the Fund's investment adviser, is part of Credit Suisse Asset Management ("CSAM"), the institutional and mutual-fund asset-management arm of Credit Suisse First Boston ("CSFB"). As of September 30, 2004, CSAM managed over $27 billion in the U.S. and, together with its global affiliates, managed assets of over $308 billion in 15 countries. SHAREHOLDER INFORMATION The market price is published in: THE NEW YORK TIMES (daily) under the designation "Indones" and THE WALL STREET JOURNAL (daily), and BARRON'S (each Monday) under the designation "Indonesia". The Fund's American Stock Exchange, LLC trading symbol is IF. Weekly comparative net asset value (NAV) and market price information about The Indonesia Fund, Inc.'s shares are published each Sunday in The NEW YORK TIMES and each Monday in THE WALL STREET JOURNAL and BARRON'S, as well as other newspapers, in a table called "Closed-End Funds." THE CSAM GROUP OF FUNDS LITERATURE REQUEST--Call today for free descriptive information on the closed-end funds listed below at 1-800-293-1232 or visit our website on the Internet: http://www.csam.com/us. CLOSED-END FUNDS SINGLE COUNTRY The Brazilian Equity Fund, Inc. (BZL) The Chile Fund, Inc. (CH) The First Israel Fund, Inc. (ISL) MULTIPLE COUNTRY The Emerging Markets Telecommunications Fund, Inc. (ETF) The Latin America Equity Fund, Inc. (LAQ) FIXED INCOME Credit Suisse Asset Management Income Fund, Inc. (CIK) Credit Suisse High Yield Bond Fund (DHY) DIRECTORS AND CORPORATE OFFICERS Enrique R. Arzac Director Lawrence J. Fox Director Richard H. Francis Director William W. Priest, Jr. Director Michael E. Kenneally Director, Chairman of the Board, Chief Executive Officer and President Boon Hong Yeo Chief Investment Officer J. Kevin Gao Senior Vice President Ajay Mehra Chief Legal Officer Emidio Morizio Chief Compliance Officer Michael A. Pignataro Chief Financial Officer and Secretary Robert M. Rizza Treasurer INVESTMENT ADVISER Credit Suisse Asset Management, LLC 466 Lexington Avenue New York, NY 10017 INVESTMENT SUB-ADVISER Credit Suisse Asset Management (Australia) Limited Level 32, Gateway Building 1 Macquarie Place Sydney NSW 2000 ADMINISTRATOR Bear Stearns Funds Management Inc. 383 Madison Avenue New York, NY 10179 CUSTODIAN Brown Brothers Harriman & Co. 40 Water Street Boston, MA 02109 SHAREHOLDER SERVICING AGENT EquiServe Trust Company, N.A. P. O. Box 43010 Providence, RI 02940 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM PricewaterhouseCoopers LLP Two Commerce Square Philadelphia, PA 19103 LEGAL COUNSEL Willkie Farr & Gallagher LLP 787 Seventh Avenue New York, NY 10019 This report, including the financial statements herein, is sent to the shareholders of the Fund for their information. It is not a prospectus, circular or representation intended for use in the purchase or sale of shares of the Fund or of any securities mentioned in this report. [AMERICAN STOCK EXCHANGE(R) LISTED IF (TM) LOGO] 3913-AR-04 ITEM 2. CODE OF ETHICS. The registrant has adopted a code of ethics applicable to its Chief Executive Officer, President, Chief Financial Officer and Chief Accounting Officer, or persons performing similar functions. A copy of the code is filed as Exhibit 12(a)(1) to this Form. There were no amendments to the code during the fiscal year ended December 31, 2004. There were no waivers or implicit waivers from the code granted by the registrant during the fiscal year ended December 31, 2004. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. The registrant's governing board has determined that it has two audit committee financial experts serving on its audit committee: Enrique R. Arzac and Richard H. Francis. Each audit committee financial expert is "independent" for purposes of this item. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. (a) through (d). The information in the table below is provided for services rendered to the registrant by its independent registered public accounting firm, PricewaterhouseCoopers LLP ("PwC"), for its fiscal years ended December 31, 2003 and December 31, 2004.
2003 2004 - ------------------------------------------------------- Audit Fees $ 32,190 $ 32,000 Audit-Related Fees(1) $ 3,000 $ 4,500 Tax Fees(2) $ 7,482 $ 7,482 All Other Fees -- -- - ------------------------------------------------------- Total $ 42,672 $ 43,982 - -------------------------------------------------------
(1) Services include agreed-upon procedures in connection with the registrant's semi-annual financial statements ($3,000 per year) and the registrant's third quarter 2004 Form N-Q filing ($1,500). (2) Tax services in connection with the registrant's excise tax calculations and review of the registrant's applicable tax returns. The information in the table below is provided with respect to non-audit services that directly relate to the registrant's operations and financial reporting and that were rendered by PwC to the registrant's investment adviser, Credit Suisse Asset Management, LLC ("CSAM"), and any service provider to the registrant controlling, controlled by or under common control with CSAM that provided ongoing services to the registrant ("Covered Services Provider"), for the registrant's fiscal years ended December 31, 2003 and December 31, 2004.
2003 2004 - ------------------------------------------------- Audit-Related Fees N/A N/A
2 Tax Fees N/A N/A All Other Fees N/A N/A - ------------------------------------------------- Total N/A N/A - -------------------------------------------------
(e)(1) Pre-Approval Policies and Procedures. The Audit Committee ("Committee") of the registrant is responsible for pre-approving (i) all audit and permissible non-audit services to be provided by the independent registered public accounting firm to the registrant and (ii) all permissible non-audit services to be provided by the independent registered public accounting firm to CSAM and any Covered Services Provider if the engagement relates directly to the operations and financial reporting of the registrant. The Committee may delegate its responsibility to pre-approve any such audit and permissible non-audit services to the Chairperson of the Committee, and the Chairperson shall report to the Committee, at its next regularly scheduled meeting after the Chairperson's pre-approval of such services, his or her decision(s). The Committee may also establish detailed pre-approval policies and procedures for pre-approval of such services in accordance with applicable laws, including the delegation of some or all of the Committee's pre-approval responsibilities to other persons (other than CSAM or the registrant's officers). Pre-approval by the Committee of any permissible non-audit services shall not be required so long as: (i) the aggregate amount of all such permissible non-audit services provided to the registrant, CSAM and any Covered Services Provider constitutes not more than 5% of the total amount of revenues paid by the registrant to its independent registered public accounting firm during the fiscal year in which the permissible non-audit services are provided; (ii) the permissible non-audit services were not recognized by the registrant at the time of the engagement to be non-audit services; and (iii) such services are promptly brought to the attention of the Committee and approved by the Committee (or its delegate(s)) prior to the completion of the audit. (e)(2) The information in the table below sets forth the percentages of fees for services (other than audit, review or attest services) rendered by PwC to the registrant for which the pre-approval requirement was waived pursuant to Rule 2-01(c)(7)(i)(C) of Regulation S-X:
2003 2004 - ------------------------------------------------- Audit-Related Fees N/A N/A Tax Fees N/A N/A All Other Fees N/A N/A - ------------------------------------------------- Total N/A N/A - -------------------------------------------------
3 The information in the table below sets forth the percentages of fees for services (other than audit, review or attest services) rendered by PwC to CSAM and any Covered Services Provider required to be approved pursuant to Rule 2-01(c)(7)(ii)of Regulation S-X, for the registrant's fiscal years ended December 31, 2003 and December 31, 2004:
2003 2004 - ------------------------------------------------- Audit-Related Fees N/A N/A Tax Fees N/A N/A All Other Fees N/A N/A - ------------------------------------------------- Total N/A N/A - -------------------------------------------------
(f) Not Applicable. (g) The aggregate fees billed by PwC for non-audit services rendered to the registrant, CSAM and Covered Service Providers for the fiscal years ended December 31, 2003 and December 31, 2004 were $10,482 and $11,982, respectively. (h) Not Applicable. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. The registrant has a separately designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended. The members of the committee are Enrique R. Arzac, Laurence Fox and Richard H. Francis. ITEM 6. SCHEDULE OF INVESTMENTS. Included as part of the report to shareholders filed under Item 1 of this Form. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. 4 CREDIT SUISSE ASSET MANAGEMENT, LLC CREDIT SUISSE FUNDS CREDIT SUISSE INSTITUTIONAL FUNDS CSAM CLOSED-END FUNDS PROXY VOTING POLICY AND PROCEDURES Introduction Credit Suisse Asset Management, LLC ("CSAM") is a fiduciary that owes each of its clients duties of care and loyalty with respect to proxy voting. The duty of care requires CSAM to monitor corporate events and to vote proxies. To satisfy its duty of loyalty, CSAM must cast proxy votes in the best interests of each of its clients. The Credit Suisse Funds, Credit Suisse Institutional Funds, and CSAM Closed-End Funds (the "Funds"), which have engaged Credit Suisse Asset Management, LLC as their investment adviser, are of the belief that the proxy voting process is a means of addressing corporate governance issues and encouraging corporate actions both of which can enhance shareholder value. Policy The Proxy Voting Policy (the "Policy") set forth below is designed to ensure that proxies are voted in the best interests of CSAM's clients. The Policy addresses particular issues and gives a general indication of how CSAM will vote proxies. The Policy is not exhaustive and does not include all potential issues. Proxy Voting Committee The Proxy Voting Committee will consist of a member of the Portfolio Management Department, a member of the Legal and Compliance Department, and a member of the Operations Department (or their designees). The purpose of the Proxy Voting Committee is to administer the voting of all clients' proxies in accordance with the Policy. The Proxy Voting Committee will review the Policy annually to ensure that it is designed to promote the best interests of CSAM's clients. For the reasons disclosed below under "Conflicts," the Proxy Voting Committee has engaged the services of an independent third party (initially, Institutional Shareholder Services ("ISS")) to assist in issue analysis and vote recommendation for proxy proposals. Proxy proposals addressed by the Policy will be voted in accordance with the Policy. Proxy proposals addressed by the Policy that require a case-by-case analysis will be voted in accordance with the vote 5 recommendation of ISS. Proxy proposals not addressed by the Policy will also be voted in accordance with the vote recommendation of ISS. To the extent that the Proxy Voting Committee proposes to deviate from the Policy or the ISS vote recommendation, the Committee shall obtain client consent as described below. CSAM investment professionals may submit a written recommendation to the Proxy Voting Committee to vote in a manner inconsistent with the Policy and/or the recommendation of ISS. Such recommendation will set forth its basis and rationale. In addition, the investment professional must confirm in writing that he/she is not aware of any conflicts of interest concerning the proxy matter or provide a full and complete description of the conflict. Conflicts CSAM is the institutional and mutual fund asset management arm of Credit Suisse First Boston, which is part of Credit Suisse Group, one of the world's largest financial organizations. As part of a global, full service investment-bank, broker-dealer, and asset-management organization, CSAM and its affiliates and personnel may have multiple advisory, transactional, financial, and other interests in securities, instruments, and companies that may be purchased or sold by CSAM for its clients' accounts. The interests of CSAM and/or its affiliates and personnel may conflict with the interests of CSAM's clients in connection with any proxy issue. In addition, CSAM may not be able to identify all of the conflicts of interest relating to any proxy matter. Consent In each and every instance in which the Proxy Voting Committee favors voting in a manner that is inconsistent with the Policy or the vote recommendation of ISS (including proxy proposals addressed and not addressed by the Policy), it shall disclose to the client conflicts of interest information and obtain client consent to vote. Where the client is a Fund, disclosure shall be made to any one director who is not an "interested person," as that term is defined under the Investment Company Act of 1940, as amended, of the Fund. Recordkeeping CSAM is required to maintain in an easily accessible place for five years all records relating to proxy voting. These records include the following: - a copy of the Policy; - a copy of each proxy statement received on behalf of CSAM clients; 6 - a record of each vote cast on behalf of CSAM clients; - a copy of all documents created by CSAM personnel that were material to making a decision on a vote or that memorializes the basis for the decision; and - a copy of each written request by a client for information on how CSAM voted proxies, as well as a copy of any written response. CSAM reserves the right to maintain certain required proxy records with ISS in accordance with all applicable regulations. Disclosure CSAM will describe the Policy to each client. Upon request, CSAM will provide any client with a copy of the Policy. CSAM will also disclose to its clients how they can obtain information on their proxy votes. ISS will capture data necessary for Funds to file Form N-PX on an annual basis concerning their proxy voting record in accordance with applicable law. Procedures The Proxy Voting Committee will administer the voting of all client proxies. CSAM has engaged ISS as an independent third party proxy voting service to assist in the voting of client proxies. ISS will coordinate with each client's custodian to ensure that proxy materials reviewed by the custodians are processed in a timely fashion. ISS will provide CSAM with an analysis of proxy issues and a vote recommendation for proxy proposals. ISS will refer proxies to the Proxy Voting Committee for instructions when the application of the Policy is not clear. The Proxy Voting Committee will notify ISS of any changes to the Policy or deviating thereof. PROXY VOTING POLICY Operational Items Adjourn Meeting Proposals to provide management with the authority to adjourn an annual or special meeting will be determined on a case-by-case basis. Amend Quorum Requirements Proposals to reduce quorum requirements for shareholder meetings below a majority of the shares outstanding will be determined on a case-by-case basis. 7 Amend Minor Bylaws Generally vote for bylaw or charter changes that are of a housekeeping nature. Change Date, Time, or Location of Annual Meeting Generally vote for management proposals to change the date/time/location of the annual meeting unless the proposed change is unreasonable. Generally vote against shareholder proposals to change the date/time/location of the annual meeting unless the current scheduling or location is unreasonable. Ratify Auditors Generally vote for proposals to ratify auditors unless: (1) an auditor has a financial interest in or association with the company, and is therefore not independent; (2) fees for non-audit services are excessive, or (3) there is reason to believe that the independent auditor has rendered an opinion, which is neither accurate nor indicative of the company's financial position. Generally vote on a case-by-case basis on shareholder proposals asking companies to prohibit their auditors from engaging in non-audit services (or capping the level of non-audit services). Generally vote on a case-by-case basis on auditor rotation proposals taking into consideration: (1) tenure of audit firm; (2) establishment and disclosure of a renewal process whereby the auditor is regularly evaluated for both audit quality and competitive price; (3) length of the rotation period advocated in the proposal, and (4) significant audit related issues. Board of Directors Voting on Director Nominees in Uncontested Elections Generally votes on director nominees on a case-by-case basis. Votes may be withheld: (1) from directors who attended less than 75% of the board and committee meetings without a valid reason for the absences; (2) implemented or renewed a dead-hand poison pill; (3) ignored a shareholder proposal that was approved by a majority of the votes cast for two consecutive years; (4) ignored a shareholder proposal approved by a majority of the shares outstanding; (5) have failed to act on takeover offers where the majority of the shareholders have tendered their shares; (6) are inside directors or affiliated outside directors and sit on the audit, compensation, or nominating committee; (7) are inside directors or affiliated outside directors and the full board serves as the audit, compensation, or nominating committee or the company does not have one of these committees; or (8) are audit committee members and the non-audit fees paid to the auditor are excessive Cumulative Voting 8 Proposals to eliminate cumulative voting will be determined on a case-by-case basis. Proposals to restore or provide for cumulative voting in the absence of sufficient good governance provisions and/or poor relative shareholder returns will be determined on a case-by-case basis. Director and Officer Indemnification and Liability Protection Proposals on director and officer indemnification and liability protection generally evaluated on a case-by-case basis. Generally vote against proposals that would: (1) eliminate entirely directors' and officers' liability for monetary damages for violating the duty of care; or (2) expand coverage beyond just legal expenses to acts, such as negligence, that are more serious violations of fiduciary obligation than mere carelessness. Generally vote for only those proposals providing such expanded coverage in cases when a director's or officer's legal defense was unsuccessful if: (1) the director was found to have acted in good faith and in a manner that he reasonably believed was in the best interests of the company, and (2) only if the director's legal expenses would be covered. Filling Vacancies/Removal of Directors Generally vote against proposals that provide that directors may be removed only for cause. Generally vote for proposals to restore shareholder ability to remove directors with or without cause. Proposals that provide that only continuing directors may elect replacements to fill board vacancies will be determined on a case-by-case basis. Generally vote for proposals that permit shareholders to elect directors to fill board vacancies. Independent Chairman (Separate Chairman/CEO) Generally vote for shareholder proposals requiring the position of chairman be filled by an independent director unless there are compelling reasons to recommend against the proposal, including: (1) designated lead director, elected by and from the independent board members with clearly delineated duties; (2) 2/3 independent board; (3) all independent key committees; or (4) established governance guidelines. Majority of Independent Directors Generally vote for shareholder proposals requiring that the board consist of a majority or substantial majority (two-thirds) of independent directors unless the board composition already meets the adequate threshold. Generally vote for shareholder proposals requiring the board audit, compensation, and/or nominating committees be composed exclusively of independent directors if they currently do not meet that standard. Generally withhold votes from insiders and affiliated outsiders sitting on the audit, compensation, or nominating committees. Generally withhold votes from insiders and affiliated outsiders on boards that are 9 lacking any of these three panels. Generally withhold votes from insiders and affiliated outsiders on boards that are not at least majority independent. Term Limits Generally vote against shareholder proposals to limit the tenure of outside directors. Proxy Contests Voting on Director Nominees in Contested Elections Votes in a contested election of directors should be decided on a case-by-case basis, with shareholders determining which directors are best suited to add value for shareholders. The major decision factors are: (1) company performance relative to its peers; (2) strategy of the incumbents versus the dissidents; (3) independence of directors/nominees; (4) experience and skills of board candidates; (5) governance profile of the company; (6) evidence of management entrenchment; (7) responsiveness to shareholders; or (8) whether takeover offer has been rebuffed. Amend Bylaws without Shareholder Consent Proposals giving the board exclusive authority to amend the bylaws will be determined on a case-by-case basis. Proposals giving the board the ability to amend the bylaws in addition to shareholders will be determined on a case-by-case basis. Confidential Voting Generally vote for shareholder proposals requesting that corporations adopt confidential voting, use independent vote tabulators and use independent inspectors of election, as long as the proposal includes a provision for proxy contests as follows: In the case of a contested election, management should be permitted to request that the dissident group honor its confidential voting policy. If the dissidents agree, the policy may remain in place. If the dissidents will not agree, the confidential voting policy may be waived. Generally vote for management proposals to adopt confidential voting. Cumulative Voting Proposals to eliminate cumulative voting will be determined on a case-by-case basis. Proposals to restore or provide for cumulative voting in the absence of sufficient good governance provisions and/or poor relative shareholder returns will be determined on a case-by-case basis. 10 Antitakeover Defenses and Voting Related Issues Advance Notice Requirements for Shareholder Proposals/Nominations Votes on advance notice proposals are determined on a case-by-case basis. Amend Bylaws without Shareholder Consent Proposals giving the board exclusive authority to amend the bylaws will be determined on a case-by-case basis. Generally vote for proposals giving the board the ability to amend the bylaws in addition to shareholders. Poison Pills (Shareholder Rights Plans) Generally vote for shareholder proposals requesting that the company submit its poison pill to a shareholder vote or redeem it. Votes regarding management proposals to ratify a poison pill should be determined on a case-by-case basis. Plans should embody the following attributes: (1) 20% or higher flip-in or flip-over; (2) two to three year sunset provision; (3) no dead-hand or no-hand features; or (4) shareholder redemption feature Shareholders' Ability to Act by Written Consent Generally vote against proposals to restrict or prohibit shareholders' ability to take action by written consent. Generally vote for proposals to allow or make easier shareholder action by written consent. Shareholders' Ability to Call Special Meetings Proposals to restrict or prohibit shareholders' ability to call special meetings or that remove restrictions on the right of shareholders to act independently of management will be determined on a case-by-case basis. Supermajority Vote Requirements Proposals to require a supermajority shareholder vote will be determined on a case-by-case basis Proposals to lower supermajority vote requirements will be determined on a case-by-case basis. Merger and Corporate Restructuring Appraisal Rights Generally vote for proposals to restore, or provide shareholders with, rights of appraisal. 11 Asset Purchases Generally vote case-by-case on asset purchase proposals, taking into account: (1) purchase price, including earnout and contingent payments; (2) fairness opinion; (3) financial and strategic benefits; (4) how the deal was negotiated; (5) conflicts of interest; (6) other alternatives for the business; or (7) noncompletion risk (company's going concern prospects, possible bankruptcy). Asset Sales Votes on asset sales should be determined on a case-by-case basis after considering: (1) impact on the balance sheet/working capital; (2) potential elimination of diseconomies; (3) anticipated financial and operating benefits; (4) anticipated use of funds; (5) value received for the asset; fairness opinion (if any); (6) how the deal was negotiated; or (6) Conflicts of interest Conversion of Securities Votes on proposals regarding conversion of securities are determined on a case-by-case basis. When evaluating these proposals, should review (1) dilution to existing shareholders' position; (2) conversion price relative to market value; (3) financial issues: company's financial situation and degree of need for capital; effect of the transaction on the company's cost of capital; (4) control issues: change in management; change in control; standstill provisions and voting agreements; guaranteed contractual board and committee seats for investor; veto power over certain corporate actions; (5) termination penalties; (6) conflict of interest: arm's length transactions, managerial incentives. Generally vote for the conversion if it is expected that the company will be subject to onerous penalties or will be forced to file for bankruptcy if the transaction is not approved. Corporate Reorganization Votes on proposals to increase common and/or preferred shares and to issue shares as part of a debt restructuring plan are determined on a case-by-case basis, after evaluating: (1) dilution to existing shareholders' position; (2) terms of the offer; (3) financial issues; (4) management's efforts to pursue other alternatives; (5) control issues; (6) conflict of interest. Generally vote for the debt restructuring if it is expected that the company will file for bankruptcy if the transaction is not approved. Reverse Leveraged Buyouts Votes on proposals to increase common and/or preferred shares and to issue shares as part of a debt restructuring plan are determined on a case-by-case basis, after evaluating: (1) dilution to existing shareholders' position; (2) terms of the offer; (3) financial issues; (4) management's efforts to pursue other alternatives; (5) control issues; (6) conflict of interest. Generally vote 12 for the debt restructuring if it is expected that the company will file for bankruptcy if the transaction is not approved. Formation of Holding Company Votes on proposals regarding the formation of a holding company should be determined on a case-by-case basis taking into consideration: (1) the reasons for the change; (2) any financial or tax benefits; (3) regulatory benefits; (4) increases in capital structure; (5) changes to the articles of incorporation or bylaws of the company. Absent compelling financial reasons to recommend the transaction, generally vote against the formation of a holding company if the transaction would include either of the following: (1) increases in common or preferred stock in excess of the allowable maximum as calculated a model capital structure; (2) adverse changes in shareholder rights; (3) going private transactions; (4) votes going private transactions on a case-by-case basis, taking into account: (a) offer price/premium; (b) fairness opinion; (c) how the deal was negotiated; (d) conflicts of interest; (e) other alternatives/offers considered; (f) noncompletion risk. Joint Ventures Vote on a case-by-case basis on proposals to form joint ventures, taking into account: (1) percentage of assets/business contributed; (2) percentage ownership; (3) financial and strategic benefits; (4) governance structure; (5) conflicts of interest; (6) other alternatives; (7) noncompletion risk; (8) liquidations. Votes on liquidations should be determined on a case-by-case basis after reviewing: (1) management's efforts to pursue other alternatives such as mergers; (2) appraisal value of the assets (including any fairness opinions); (3) compensation plan for executives managing the liquidation. Generally vote for the liquidation if the company will file for bankruptcy if the proposal is not approved. Mergers and Acquisitions Votes on mergers and acquisitions should be considered on a case-by-case basis, determining whether the transaction enhances shareholder value by giving consideration to: (1) prospects of the combined companies; (2) anticipated financial and operating benefits; (3) offer price; (4) fairness opinion; (5) how the deal was negotiated; (6) changes in corporate governance and their impact on shareholder rights; (7) change in the capital structure; (8) conflicts of interest. Private Placements Votes on proposals regarding private placements should be determined on a case-by-case basis. When evaluating these proposals, should review: (1) dilution to existing shareholders' position; (2) terms of the offer; (3) financial issues; (4) management's efforts to pursue alternatives such as mergers; (5) control issues; (6) conflict of interest. Generally vote for the 13 private placement if it is expected that the company will file for bankruptcy if the transaction is not approved. Prepackaged Bankruptcy Plans Votes on proposals to increase common and/or preferred shares and to issue shares as part of a debt restructuring plan are determined on a case-by-case basis, after evaluating: (1) dilution to existing shareholders' position; (2) terms of the offer; (3) financial issues; (4) management's efforts to pursue other alternatives; (5) control issues; (6) conflict of interest. Generally vote for the debt restructuring if it is expected that the company will file for bankruptcy if the transaction is not approved. Recapitalization Votes case-by-case on recapitalizations (reclassifications of securities), taking into account: (1) more simplified capital structure; (2) enhanced liquidity; (3) fairness of conversion terms, including fairness opinion; (4) impact on voting power and dividends; (5) reasons for the reclassification; (6) conflicts of interest; (7) other alternatives considered. Reverse Stock Splits Generally vote for management proposals to implement a reverse stock split when the number of authorized shares will be proportionately reduced. Generally vote for management proposals to implement a reverse stock split to avoid delisting. Votes on proposals to implement a reverse stock split that do not proportionately reduce the number of shares authorized for issue should be determined on a case-by-case basis. Spinoffs Votes on spinoffs should be considered on a case-by-case basis depending on: (1) tax and regulatory advantages; (2) planned use of the sale proceeds; (3) valuation of spinoff; fairness opinion; (3) benefits that the spinoff may have on the parent company including improved market focus; (4) conflicts of interest; managerial incentives; (5) any changes in corporate governance and their impact on shareholder rights; (6) change in the capital structure Value Maximization Proposals Vote case-by-case on shareholder proposals seeking to maximize shareholder value. Capital Structure Adjustments to Par Value of Common Stock 14 Generally vote for management proposals to reduce the par value of common stock unless the action is being taken to facilitate an antitakeover device or some other negative corporate governance action. Generally vote for management proposals to eliminate par value. Common Stock Authorization Votes on proposals to increase the number of shares of common stock authorized for issuance are determined on a case-by-case basis. Generally vote against proposals at companies with dual-class capital structures to increase the number of authorized shares of the class of stock that has superior voting rights. Generally vote for proposals to approve increases beyond the allowable increase when a company's shares are in danger of being delisted or if a company's ability to continue to operate as a going concern is uncertain. Dual-class Stock Generally vote against proposals to create a new class of common stock with superior voting rights. Generally vote for proposals to create a new class of nonvoting or subvoting common stock if: (1) it is intended for financing purposes with minimal or no dilution to current shareholders; (2) it is not designed to preserve the voting power of an insider or significant shareholder. Issue Stock for Use with Rights Plan Generally vote against proposals that increase authorized common stock for the explicit purpose of implementing a shareholder rights plan. Preemptive Rights Votes regarding shareholder proposals seeking preemptive rights should be determined on a case-by-case basis after evaluating: (1) the size of the company; (2) the shareholder base; (3) the liquidity of the stock Preferred Stock Generally vote against proposals authorizing the creation of new classes of preferred stock with unspecified voting, conversion, dividend distribution, and other rights ("blank check" preferred stock). Generally vote for proposals to create "declawed" blank check preferred stock (stock that cannot be used as a takeover defense). Generally vote for proposals to authorize preferred stock in cases where the company specifies the voting, dividend, conversion, and other rights of such stock and the terms of the preferred stock appear reasonable. Generally vote against proposals to increase the number of blank check preferred stock authorized for issuance when no shares have been issued or reserved for a specific purpose. Generally vote case-by-case on proposals to increase the number of blank check 15 preferred shares after analyzing the number of preferred shares available for issue given a company's industry and performance in terms of shareholder returns. Recapitalization Vote case-by-case on recapitalizations (reclassifications of securities), taking into account: (1) more simplified capital structure; (2) enhanced liquidity; (3) fairness of conversion terms, including fairness opinion; (4) impact on voting power and dividends; (5) reasons for the reclassification; (6) conflicts of interest; (7) other alternatives considered. Reverse Stock Splits Generally vote for management proposals to implement a reverse stock split when the number of authorized shares will be proportionately reduced. Generally vote for management proposals to implement a reverse stock split to avoid delisting. Votes on proposals to implement a reverse stock split that do not proportionately reduce the number of shares authorized for issue should be determined on a case-by-case basis. Share Repurchase Programs Generally vote for management proposals to institute open-market share repurchase plans in which all shareholders may participate on equal terms. Stock Distributions: Splits and Dividends Generally vote for management proposals to increase the common share authorization for a stock split or share dividend, provided that the increase in authorized shares would not result in an excessive number of shares available for issuance. Tracking Stock Votes on the creation of tracking stock are determined on a case-by-case basis, weighing the strategic value of the transaction against such factors as: (1) adverse governance changes; (2) excessive increases in authorized capital stock; (3) unfair method of distribution; (4) diminution of voting rights; (5) adverse conversion features; (6) negative impact on stock option plans; (7) other alternatives such as a spinoff. Executive and Director Compensation Executive and Director Compensation Votes on compensation plans for directors are determined on a case-by-case basis. 16 Stock Plans in Lieu of Cash Votes for plans which provide participants with the option of taking all or a portion of their cash compensation in the form of stock are determined on a case-by-case basis. Generally vote for plans which provide a dollar-for-dollar cash for stock exchange. Votes for plans which do not provide a dollar-for-dollar cash for stock exchange should be determined on a case-by-case basis. Director Retirement Plans Generally vote against retirement plans for nonemployee directors. Generally vote for shareholder proposals to eliminate retirement plans for nonemployee directors. Management Proposals Seeking Approval to Reprice Options Votes on management proposals seeking approval to reprice options are evaluated on a case-by-case basis giving consideration to the following: (1) historic trading patterns; (2) rationale for the repricing; (3) value-for-value exchange; (4) option vesting; (5) term of the option; (6) exercise price; (7) participants; (8) employee stock purchase plans. Votes on employee stock purchase plans should be determined on a case-by-case basis. Generally vote for employee stock purchase plans where: (1) purchase price is at least 85 percent of fair market value; (2) offering period is 27 months or less, and (3) potential voting power dilution (VPD) is ten percent or less. Generally vote against employee stock purchase plans where either: (1) purchase price is less than 85 percent of fair market value; (2) Offering period is greater than 27 months, or (3) VPD is greater than ten percent Incentive Bonus Plans and Tax Deductibility Proposals Generally vote for proposals that simply amend shareholder-approved compensation plans to include administrative features or place a cap on the annual grants any one participant may receive. Generally vote for proposals to add performance goals to existing compensation plans. Votes to amend existing plans to increase shares reserved and to qualify for favorable tax treatment considered on a case-by-case basis. Generally vote for cash or cash and stock bonus plans that are submitted to shareholders for the purpose of exempting compensation from taxes if no increase in shares is requested. Employee Stock Ownership Plans (ESOPs) Generally vote for proposals to implement an ESOP or increase authorized shares for existing ESOPs, unless the number of shares allocated to the ESOP is excessive (more than five percent of outstanding shares.) 401(k) Employee Benefit Plans 17 Generally vote for proposals to implement a 401(k) savings plan for employees. Shareholder Proposals Regarding Executive and Director Pay Generally vote for shareholder proposals seeking additional disclosure of executive and director pay information, provided the information requested is relevant to shareholders' needs, would not put the company at a competitive disadvantage relative to its industry, and is not unduly burdensome to the company. Generally vote against shareholder proposals seeking to set absolute levels on compensation or otherwise dictate the amount or form of compensation. Generally vote against shareholder proposals requiring director fees be paid in stock only. Generally vote for shareholder proposals to put option repricings to a shareholder vote. Vote for shareholders proposals to exclude pension fund income in the calculation of earnings used in determining executive bonuses/compensation. Vote on a case-by-case basis for all other shareholder proposals regarding executive and director pay, taking into account company performance, pay level versus peers, pay level versus industry, and long term corporate outlook. Performance-Based Option Proposals Generally vote for shareholder proposals advocating the use of performance-based equity awards (indexed, premium-priced, and performance-vested options), unless: (1) the proposal is overly restrictive; or (2) the company demonstrates that it is using a substantial portion of performance-based awards for its top executives. Stock Option Expensing Generally vote for shareholder proposals asking the company to expense stock options unless the company has already publicly committed to start expensing by a specific date. Golden and Tin Parachutes Generally vote for shareholder proposals to require golden and tin parachutes to be submitted for shareholder ratification, unless the proposal requires shareholder approval prior to entering into employment contracts. Vote on a case-by-case basis on proposals to ratify or cancel golden or tin parachutes. May 19, 2004 ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Form N-CSR disclosure requirement is not yet effective with respect to the registrant. 18 ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. None. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant's board of directors since the registrant last provided disclosure in response to the requirements of Item 7(d)(2)(ii)(g) of Schedule 14A in its definitive proxy statement dated March 1, 2005. ITEM 11. CONTROLS AND PROCEDURES. (a) As of a date within 90 days from the filing date of this report, the principal executive officer and principal financial officer concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the "Act")) were effective based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. (b) There were no changes in registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. (a)(1) Registrant's Code of Ethics is an exhibit to this report. (a)(2) The certifications of the registrant as required by Rule 30a-2(a) under the Act are exhibits to this report. (a)(3) Not applicable. (b) The certifications of the registrant as required by Rule 30a-2(b) under the Act are an exhibit to this report. 19 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. THE INDONESIA FUND, INC. /s/ Michael E. Kenneally ------------------------ Name: Michael E. Kenneally Title: Chief Executive Officer Date: March 8, 2005 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. /s/ Michael E. Kenneally ------------------------ Name: Michael E. Kenneally Title: Chief Executive Officer Date: March 8, 2005 /s/ Michael A. Pignataro ------------------------ Name: Michael A. Pignataro Title: Chief Financial Officer Date: March 8, 2005 EX-99.CODE 2 a2152734zex-99_code.txt EX-99.CODE EX-99.CODE ETHICS EXHIBIT 12(a)(1) CODE OF ETHICS CREDIT SUISSE FUNDS CREDIT SUISSE INSTITUTIONAL FUNDS CREDIT SUISSE CLOSED-END FUNDS CODE OF ETHICS FOR SENIOR OFFICERS PREAMBLE Section 406 of the Sarbanes-Oxley Act of 2002 directs that rules be adopted disclosing whether a company has a code of ethics for senior financial officers. The Securities and Exchange Commission (the "SEC") has adopted rules requiring annual disclosure of an investment company's code of ethics applicable to the company's principal executive as well as principal financial officers, if such a code has been adopted. In response, the above Funds (each a "Fund", and together the "Funds") have adopted this Code of Ethics. STATEMENT OF POLICY It is the obligation of the senior officers of the Funds to provide full, fair, timely and comprehensible disclosure--financial and otherwise--to Fund shareholders, regulatory authorities and the general public. In fulfilling that obligation, senior officers must act ethically, honestly and diligently. This Code is intended to enunciate guidelines to be followed by persons who serve the Funds in senior officerships. No Code can address every situation that a senior officer might face; however, as a guiding principle, senior officers should strive to implement the spirit as well as the 1 letter of applicable laws, rules and regulations, and to provide the type of clear and complete disclosure and information Fund shareholders have a right to expect. The purpose of this Code of Ethics is to promote high standards of ethical conduct by Covered Persons (as defined below) in their capacities as officers of the Funds, to instruct them as to what is considered to be inappropriate and unacceptable conduct or activities for officers and to prohibit such conduct or activities. This Code supplements other policies that the Funds and their adviser have adopted or may adopt in the future with which Fund officers are also required to comply (e.g., code of ethics relating to personal trading and conduct). COVERED PERSONS This Code of Ethics applies to those persons appointed by the Fund's Board of Directors as Chief Executive Officer, President, Chief Financial Officer and Chief Accounting Officer, or persons performing similar functions. It is recognized that each of such persons currently is a full-time employee of Credit Suisse Asset Management LLC ("CSAM"), each Fund's investment adviser. PROMOTION OF HONEST AND ETHICAL CONDUCT In serving as an officer of the Funds, each Covered Person must maintain high standards of honesty and ethical conduct and must encourage his colleagues who provide services to the Funds, whether directly or indirectly, to do the same. Each Covered Person understands that as an officer of a Fund, he has a duty to act in the best interests of the Fund and its shareholders. The interests of other CSAM clients or CSAM itself or the Covered Person's personal interests should not be allowed to compromise the Covered 2 Person's fulfilling his duties as an officer of the Fund. The governing Boards of the Funds recognize that the Covered Persons are also officers or employees of CSAM. Furthermore, the governing Boards of the Funds recognize that, subject to the Covered Person's fiduciary duties to the Funds, the Covered Persons will in the normal course of their duties (whether formally for the Funds or for CSAM, or for both) be involved in establishing policies and implementing decisions that will have different effects on CSAM and the Funds. The governing Boards of the Funds recognize that the participation of the Covered Persons in such activities is inherent in the contractual relationship between the Funds and CSAM and/or its affiliates, and is consistent with the expectation of the governing Boards of the performance by the Covered Persons of their duties as officers of the Funds. If a Covered Person believes that his responsibilities as an officer or employee of CSAM are likely to materially compromise his objectivity or his ability to perform the duties of his role as an officer of the Funds, he should consult with CSAM's general counsel, the Funds' chief legal officer or outside counsel, or counsel to the independent Directors/Trustees of the relevant Fund or Funds. Under appropriate circumstances, a Covered Person should also consider whether to present the matter to the Directors/Trustees of the relevant Fund or Funds or a committee thereof. No Covered Person shall suggest that any person providing, or soliciting to be retained to provide, services to a Fund give a gift or an economic benefit of any kind to him in connection with the person's retention or the provision of services. PROMOTION OF FULL, FAIR, ACCURATE, TIMELY AND UNDERSTANDABLE DISCLOSURE No Covered Person shall create or further the creation of false or misleading information in any SEC filing or report to Fund shareholders. No Covered Person shall conceal or fail 3 to disclose information within the Covered Person's possession legally required to be disclosed or necessary to make the disclosure made not misleading. If a Covered Person shall become aware that information filed with the SEC or made available to the public contains any false or misleading information or omits to disclose necessary information, he shall promptly report it to CSAM's general counsel or Fund counsel, who shall advise such Covered Person whether corrective action is necessary or appropriate. Each Covered Person, consistent with his responsibilities, shall exercise appropriate supervision over, and shall assist, relevant Fund service providers in developing financial information and other disclosure that complies with relevant law and presents information in a clear, comprehensible and complete manner. Each Covered Person shall use his best efforts within his area of expertise to assure that Fund reports reveal, rather than conceal, the relevant Fund's financial condition. Each Covered Person shall seek to obtain additional resources if he believes that available resources are inadequate to enable the Funds to provide full, fair and accurate financial information and other disclosure to regulators and Fund shareholders. Each Covered Person shall inquire of other Fund officers and service providers, as appropriate, to assure that information provided is accurate and complete and presented in an understandable format using comprehensible language. Each Covered Person shall diligently perform his services to the Funds, so that information can be gathered and assessed early enough to facilitate timely filings and issuance of reports and required certifications. 4 PROMOTION OF COMPLIANCE WITH APPLICABLE GOVERNMENT LAWS, RULES AND REGULATIONS Each Covered Person shall become and remain knowledgeable concerning the laws and regulations relating to the Funds and their operations and shall act with competence and due care in serving as an officer of the Funds. Each Covered Person with specific responsibility for financial statement disclosure will become and remain knowledgeable concerning relevant auditing standards, generally accepted accounting principles, FASB pronouncements and other accounting and tax literature and developments. Each Covered Person shall devote sufficient time to fulfilling his responsibilities to the Funds, recognizing that he will devote substantial time to providing services to other CSAM clients and will perform other activities as an employee of CSAM. Each Covered Person shall cooperate with a Fund's independent auditors, regulatory agencies and internal auditors in their review or inspection of the Fund and its operations. No Covered Person shall knowingly violate any law or regulation relating to the Funds or their operations or seek to illegally circumvent any such law or regulation. No Covered Person shall engage in any conduct involving dishonesty, fraud, deceit or misrepresentation involving the Funds or their operations. PROMOTING PROMPT INTERNAL REPORTING OF VIOLATIONS Each Covered Person shall promptly report his own violations of this Code and violations by other Covered Persons of which he is aware to the Chairman of the relevant Fund's Audit Committee. 5 Any requests for a waiver from or an amendment to this Code shall be made to the Chairman of the relevant Fund's Audit Committee. All waivers and amendments shall be disclosed as required by law. SANCTIONS Failure to comply with this Code will subject the violator to appropriate sanctions, which will vary based on the nature and severity of the violation. Such sanctions may include censure, suspension or termination of position as an officer of the Fund. Sanctions shall be imposed by the relevant Fund's Audit Committee, subject to review by the entire Board of Directors/Trustees of the Fund. Each Covered Person shall be required to certify annually whether he has complied with this Code. NO RIGHTS CREATED This Code of Ethics is a statement of certain fundamental principles, policies and procedures that govern the Funds' senior officers in the conduct of the Funds' business. It is not intended to and does not create any rights in any employee, investor, supplier, competitor, shareholder or any other person or entity. RECORDKEEPING The Funds will maintain and preserve for a period of not less than six (6) years from the date such action is taken, the first two (2) years in an easily accessible place, a copy of the information or materials supplied to the Board (1) that provided the basis for any amendment or 6 waiver to this Code and (2) relating to any violation of the Code and sanctions imposed for such violation, together with a written record of the approval or action taken by the relevant Board. AMENDMENTS The Directors/Trustees will make and approve such changes to this Code of Ethics as they deem necessary or appropriate to effectuate the purposes of this Code. Dated: May 19, 2004 7 CODE OF ETHICS FOR SENIOR OFFICERS: I HEREBY CERTIFY THAT: (1) I have read and I understand the Code of Ethics for Senior Officers adopted by the Credit Suisse Funds, the Credit Suisse Institutional Funds and the Credit Suisse Closed-End Funds (the "Code of Ethics"); (2) I recognize that I am subject to the Code of Ethics; (3) I have complied with the requirements of the Code of Ethics during the calendar year ending December 31, _______; and (4) I have reported all violations of the Code of Ethics required to be reported pursuant to the requirements of the Code during the calendar year ending December 31, _______. Set forth below exceptions to items (3) and (4), if any: ---------------------------------------- ---------------------------------------- ---------------------------------------- Name: --------------- Date: 8 EX-99.CERT 3 a2152734zex-99_cert.txt EX-99.CERT EX-99.CERT EXHIBIT 12(a)(2) CERTIFICATIONS I, Michael A. Pignataro, certify that: 1. I have reviewed this report on Form N-CSR of The Indonesia Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 8, 2005 /s/ Michael A. Pignataro - ------------------------ Michael A. Pignataro Chief Financial Officer I, Michael E. Kenneally, certify that: 1. I have reviewed this report on Form N-CSR of The Indonesia Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial data information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 8, 2005 /s/ Michael E. Kenneally - ------------------------ Michael E. Kenneally Chief Executive Officer EX-99.906CERT 4 a2152734zex-99_906cert.txt EX-99.906CERT EX-99.906CERT EXHIBIT 12(b) SECTION 906 CERTIFICATIONS SECTION 906 CERTIFICATION Michael E. Kenneally, Chief Executive Officer, and Michael A. Pignataro, Chief Financial Officer, of The Indonesia Fund, Inc. (the "Fund"), each certify to his knowledge that: (1) The Fund's periodic report on Form N-CSR for the period ended December 31, 2004 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Fund. /s/ Michael E. Kenneally /s/ Michael A. Pignataro ------------------------ ------------------------ Michael E. Kenneally Michael A. Pignataro Chief Executive Officer Chief Financial Officer March 8, 2005 March 8, 2005 A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Fund and will be retained by the Fund and furnished to the Securities and Exchange Commission or its staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----