INVESTMENTS

CIRI has a diverse portfolio of managed funds and securities. These investments include short-term instruments held to keep CIRI funds liquid pending future investment decisions and longer-term private equity placements and other instruments that are designed to produce long-term capital appreciation.

A number of CIRI's private equity placements are mature and are returning capital. The company intends to participate in new private equity opportunities as this capital is returned, basing such investments on quality and existing relationships.

CIRI's total assets in managed funds at the end of 2006 were $355.2 million, an increase of $84.7 million over 2005. This was due primarily to the receipt of proceeds from the sale of tourism properties offset by additional real estate investments.

Financial market events are dominating the news and stock fluctuations, bank bailouts and government rescue plans are creating market uncertainties that are making many investors nervous.

CIRI's investments in public market securities and private equity securities have been adversely affected by recent financial market events. However, In early 2007, CIRI diversified its holdings away from a large-cap value concentrated portfolio to one more reflective of the broad market, including both growth and small- and mid-cap securities. This change benefited CIRI by reducing its holdings in bank, brokerage and insurance companies that are experiencing the greatest difficulty in today’s markets.